1
Exhibit 10(g)
HARRIS CORPORATION
RETIREMENT PLAN
2
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
1.1 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.2 After-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.3 After-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.4 Basic Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.5 Balanced Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.6 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.7 Break-in-Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.8 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.9 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.10 Consolidated Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.11 Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.12 Corporation Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.13 Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.14 Early Retirement Age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
1.15 Employment Unit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.16 Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.17 ERISA - . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.18 Excess Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
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1.19 Fiscal Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.20 Harris Stock Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.21 Harris Stock After-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.22 Harris Stock Matching After-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.23 Harris Stock Matching Pre-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.24 Harris Stock Pre-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.25 Highly Compensated Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.26 Hour of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.27 Investment Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.28 Layoff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.29 Leave of Absence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.30 Matching After-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.31 Matching After-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.32 Matching Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.33 Matching Pre-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.34 Matching Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.35 Military Leave . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.36 Normal Retirement Age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.37 Original Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.38 Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.39 Participating Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.40 Period of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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1.41 Period of Severance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.42 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.43 Plan Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.44 Predecessor Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.45 Pre-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.46 Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.47 Profit-Sharing Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.48 Profit-Sharing Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.49 Related Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
1.50 Rollover Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.51 Savings Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.52 Severance from Service Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
1.53 Supplemental Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.54 Taxable Wage Base . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.55 Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.56 Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.57 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
1.58 Valuation Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
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ARTICLE II
PARTICIPATION
2.1 In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.2 Renewal of Participation on Reemployment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.3 Periods of Service on Reemployment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
2.4 Service with Predecessor Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
2.5 Participation for Purposes of Rollover Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
ARTICLE III
CONTRIBUTIONS AND ALLOCATIONS
3.1 Profit-Sharing Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.2 Allocation of Profit-Sharing Contributions to Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
3.3 Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
3.4 Matching Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
3.5 After-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.6 Matching After-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
3.7 Elections to Make Pre-Tax and After-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
3.8 Rollover Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
3.9 Participating Company's Obligation to Make
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
3.10 Treatment of Forfeited Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
3.11 Finality of Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
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ARTICLE IV
LIMITATIONS ON CONTRIBUTIONS
4.1 In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
4.2 Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
4.3 Percentage Limitation on Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
4.4 Percentage Limitation on After-Tax and Matching
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
4.5 Multiple Use of Alternative Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
4.6 Limitations on Annual Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE V
VESTING AND FORFEITURES
5.1 In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
5.2 Vesting on Retirement, Death or Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
5.3 Vesting on Other Termination of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
5.4 Effect of In-Service Withdrawals on a Participant's Vested Percentage . . . . . . . . . . . . . . . . . . . . . 43
5.5 Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ARTICLE VI
ACCOUNTS AND INVESTMENTS
6.1 Establishment of Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
6.2 Investment of Profit-Sharing Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
6.3 Investment of Accounts Other than Profit-Sharing Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
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6.4 Allocation of Earnings and Losses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
6.5 Special Rules Concerning Harris Stock Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE VII
DISTRIBUTIONS
7.1 In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7.2 Small Benefit Cash-out . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
7.3 Form of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
7.4 Time of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.5 Direct Rollover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
7.6 Payments on Death . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
7.7 Benefit Amount and Withholding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
7.8 Order of Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
7.9 Statutory Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
7.10 Designating Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
7.11 Payment of Group Insurance Premiums . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 65
7.12 Inability to Locate Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
ARTICLE VIII
LOANS
8.1 In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
8.2 Loan Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
8.3 Terms and Conditions of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
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8.4 Interest Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
8.5 Repayment and Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
8.6 Mechanics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
8.7 Special Powers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
ARTICLE IX
IN-SERVICE WITHDRAWALS
9.1 At-Will Withdrawals from Savings Account and After-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . 75
9.2 Hardship Withdrawals from Pre-Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
9.3 Emergency Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
9.4 Reduction of Investment Fund Balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
ARTICLE X
TOP-HEAVY PROVISIONS
10.1 In General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
10.2 Minimum Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
10.3 Minimum Vesting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
10.4 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
ARTICLE XI
ADMINISTRATION
11.1 Named Fiduciaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
11.2 Corporation Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
11.3 Powers and Duties of Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
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11.4 Actions of Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
11.5 Finality of Decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
11.6 Immunities of Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
11.7 Advisers and Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
11.8 Committee Member who is Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.9 Information Provided by Participating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.10 Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
11.11 Trust Fund Available to Pay All Plan Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
ARTICLE XII
AMENDMENT AND TERMINATION AND CHANGE OF CONTROL
12.1 Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
12.2 Termination of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
12.3 Discontinuance of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
12.4 Vesting on Termination or Discontinuance of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
12.5 Distribution on Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
12.6 Change of Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
ARTICLE XIII
MISCELLANEOUS PROVISIONS
13.1 Restrictions on Alienation; Qualified Domestic Relations Orders . . . . . . . . . . . . . . . . . . . . . . . . 97
13.2 Exclusive Benefit Requirement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
13.3 Return of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
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13.4 No Contract of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 99
13.5 Payment of Benefits on Incapacity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
13.6 Merger . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
13.7 Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100
13.8 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
13.9 Mistaken Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 101
ARTICLE XIV
SPECIAL PROVISIONS FOR
EMPLOYEES OF
HARRIS TECHNICAL SERVICES DIVISION OF
HARRIS TECHNICAL SERVICES CORPORATION
14.1 Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
14.2 Profit-Sharing Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 102
14.3 Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
14.4 No Matching Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
14.5 No Investment in the Harris Stock Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
14.6 Vesting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
- ix -
11
INTRODUCTION
The Harris Corporation Retirement Plan (the "Plan") is hereby
amended and restated effective July 1, 1994. Those Participants in the Plan
who are Employees on July 1, 1994 shall continue to participate in the Plan, as
restated. Those Participants in the Plan who are not Employees on July 1, 1994
shall not be participants in the Plan, as restated, and their benefits shall be
determined under the terms of the Plan that were in effect prior to July 1,
1994 unless they are reemployed as Employees by a Participating Company.
The Plan and the related trust are intended to be a tax-exempt plan and trust
under sections 401(a) and 501(a) of the Code, respectively. The Plan also is
intended to be a profit-sharing plan that contains a qualified cash or deferred
arrangement under section 401(k) of the Code.
- 1 -
12
ARTICLE I
DEFINITIONS
1.1 ACCOUNTS -- means all of the accounts described in section
6.1, and such other accounts that may be established on behalf of each
Participant, to be credited with contributions made on behalf of a Participant,
adjusted for earnings and losses as provided in the Plan and debited by Plan
expenses allocable to the Accounts, distributions, withdrawals and loans to the
Participant.
1.2 AFTER-TAX ACCOUNT - means the account established to
record After-Tax Contributions made on the Participant's behalf other than
those invested in the Harris Stock Fund.
1.3 AFTER-TAX CONTRIBUTIONS -- means the contributions described in
section 3.5.
1.4 BASIC ACCOUNT -- means the account established to record
the portion of the Profit-Sharing Contributions allocable to a Participant's
Compensation.
1.5 BALANCED FUND -- means the Balanced Fund described in
Appendix A.
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Harris Retirement Plan
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Definitions
1.6 BENEFICIARY -- means the person or persons entitled to
receive any benefits payable under the Plan on account of a Participant's
death.
1.7 BREAK-IN-SERVICE -- means a Period of Severance, as
defined below.
1.8 CODE -- means the Internal Revenue Code of 1986, as
amended from time to time.
1.9 COMPENSATION -- means the following items of remuneration
which an Employee earns for work or personal services performed for a
Participating Company:
(a) salary or wage;
(b) commission paid pursuant to a sales incentive
plan;
(c) overtime premium, shift differential or,
additional compensation in lieu of overtime
premium;
(d) compensation in lieu of vacation;
(e) any annual bonus or incentive compensation
payable in the form of cash pursuant to the
Annual Incentive Plan or any successor thereto or
other similar plan adopted by the Corporation
from time to time or any stock award made in lieu
of an annual cash bonus or incentive
compensation;
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Harris Retirement Plan
14
Definitions
(f) any cash bonus or incentive compensation payable
in the form of cash or any stock awards made
pursuant to an established plan of the
Corporation or Employee's Employment Unit,
including but not limited to, bonus awards, spot
awards, lump sum, profit sharing, team awards and
gain sharing awards;
(g) any compensation of a type described in items (a)
through (f) above which is paid as an employee
contribution to the Plan;
(h) any salary reduction contributions to a Section
125 plan maintained by a Participating Company;
but excluding:
(i) any extraordinary compensation of a recurring
or non-recurring nature not included under
items (a) to (f) above;
(ii) any extraordinary compensation in the nature of
bonus, commission or incentive compensation which
is not paid pursuant to an established plan of
the Employee's Employment Unit or pursuant to an
established sales incentive plan;
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Harris Retirement Plan
15
Definitions
(iii) any bonus or special allowance paid by reason of
employment in a foreign country;
(iv) any award made or amount paid pursuant to the
Stock Incentive Plan or any successor thereto,
including, but not limited to, performance
shares, stock options, restricted stock, SARs, or
other stock-based awards or dividend equivalents;
(v) severance pay or special retirement pay;
(vi) retention bonuses or completion bonuses unless
authorized by the appropriate officer of the
Corporation in a uniform and nondiscriminatory
manner;
(vii) reimbursement or allowances with respect to
expenses incurred in connection with employment,
such as tax equalization, reimbursement for
moving expenses, mileage or expense allowance or
education refund.
In no event does the term "Compensation" include indirect compensation such as
employer paid group insurance premiums, or contributions under this or other
qualified employee benefit plan, other than as a contribution described in item
(g) above.
Only Compensation not in excess of the amount allowed under Code
section 401(a)(17), which is $150,000 for 1994, shall be taken into account.
In
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Harris Retirement Plan
16
Definitions
addition, in the year in which an Employee becomes a Participant, only
Compensation received after he becomes a Participant shall be taken into
account. For purposes of any test imposed under any section of the Code, the
Plan authorizes the use of any definition of Compensation that satisfies the
requirements of such section.
1.10 CONSOLIDATED SUBSIDIARIES -- means those subsidiaries of
the Corporation which are included in the consolidated annual financial
statement for the Corporation.
1.11 CORPORATION -- means Harris Corporation.
1.12 CORPORATION COMMITTEE -- means the committee established
under section 11.2.
1.13 DISABILITY -- means a disability that qualifies a
Participant for disability benefits under title II or title XVI of the Federal
Social Security Act, and occurs on the effective date determined by the Social
Security Administration.
1.14 EARLY RETIREMENT AGE -- means age 55.
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Harris Retirement Plan
17
Definitions
1.15 EMPLOYMENT UNIT - means any division or other readily
identifiable segment of the operations of a Participating Company, for example,
as identified in the annual report or such other segments as may be established
for purposes of the Plan by the Corporation, in its discretion.
1.16 EMPLOYEE -- means an individual who is employed by a
Participating Company, or division or operation thereof, designated in Appendix
C either (a) within the United States or (b) outside the United States who is
covered by the Corporation's current expatriate assignment policy; provided
that the individual is not covered by a retirement plan which is maintained by
the Participating Company pursuant to a collective bargaining agreement and
which was in effect on or after July 1, 1990. With respect to a Participating
Company not all of whose employees are eligible to be participants (a "Limited
Participating Company"), the term "Employee" shall include those employees of
the Participating Company who were Participants prior to their employment by
the Limited Participating Company. Solely for Plan qualification testing, the
term "Employee" includes a "leased employee" only to the extent required in
section 414(n) of the Code.
1.17 ERISA -- means the Employee Retirement Income Security Act
of 1974, as amended from time to time.
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Harris Retirement Plan
18
Definitions
1.18 EXCESS COMPENSATION -- means the portion of a
Participant's Compensation that exceeds the Taxable Wage Base for the year in
which the Compensation is received.
1.19 FISCAL YEAR -- means the fiscal year of the Corporation
commencing on July 1 and ending on June 30.
1.20 HARRIS STOCK FUND -- means the Fund described in Appendix
A that is designed to be invested in qualifying employer securities within the
meaning of Section 407 of ERISA, as it applies to an eligible individual
account plan.
1.21 HARRIS STOCK AFTER-TAX ACCOUNT -- means the portion of the
After-Tax Contributions made on the Participant's behalf invested in the Harris
Stock Fund.
1.22 HARRIS STOCK MATCHING AFTER-TAX ACCOUNT -- means the
portion of the Matching After-Tax Contributions made on the Participant's
behalf invested in the Harris Stock Fund.
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Harris Retirement Plan
19
Definitions
1.23 HARRIS STOCK MATCHING PRE-TAX ACCOUNT -- means the portion
of the Matching Pre-Tax Contributions made on the Participant's behalf invested
in the Harris Stock Fund.
1.24 HARRIS STOCK PRE-TAX ACCOUNT -- means the portion of the
Pre-Tax Contributions made on the Participant's behalf invested in the Harris
Stock Fund.
1.25 HIGHLY COMPENSATED EMPLOYEE -- means a "highly compensated
employee" for a Plan Year as defined in section 414(q) of the Code, including
the family aggregation rules contained therein.
1.26 HOUR OF SERVICE -- means each hour for which an Employee
is paid or entitled to payment for the performance of duties for a
Participating Company or Related Company.
1.27 INVESTMENT FUNDS -- means the funds described in Appendix
A to the Plan.
1.28 LAYOFF -- means a temporary suspension of the active
employment of an Employee with the understanding that the Employee will be
recalled to active employment if and when his services are again required. A
period of
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Harris Retirement Plan
20
Definitions
Layoff terminates, and a Participant who is not recalled is deemed to terminate
employment, on the earliest of the following dates:
(a) the expiration date specified in a notice of recall
delivered to the Employee;
(b) the first anniversary of the date the Layoff began, or
(c) the election of an Employee to terminate the Layoff
by written notice delivered to the Corporation.
1.29 LEAVE OF ABSENCE -- means a period of interruption of the
active employment of an Employee granted by the Participating Company or
Predecessor Company with the understanding that the Employee will return to
active employment at the expiration of the period of time. A Leave of Absence
is of definite duration, but may be extended by the Participating Company or
Predecessor Company for additional periods. The term Leave of Absence does not
include a Military Leave.
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Harris Retirement Plan
21
Definitions
1.30 MATCHING AFTER-TAX ACCOUNT -- means the account
established to record Matching After-Tax Contributions made on the
Participant's behalf other than those invested in the Harris Stock Fund.
1.31 MATCHING AFTER-TAX CONTRIBUTIONS -- means the
contributions made on behalf of a Participant under section 3.6.
1.32 MATCHING CONTRIBUTIONS -- means the aggregate of the
Matching After-Tax Contributions and the Matching Pre-Tax Contributions.
1.33 MATCHING PRE-TAX ACCOUNT -- means the account established
to record the Matching Pre-Tax Contributions made on the Participant's behalf
other than those invested in the Harris Stock Fund.
1.34 MATCHING PRE-TAX CONTRIBUTIONS -- means the contributions
made on behalf of a Participant under section 3.4.
1.35 MILITARY LEAVE -- means an interruption of active
employment of an Employee with a Participating Company or Predecessor Company
to enter the Armed Forces of the United States under such circumstances that
the Employee
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Harris Retirement Plan
22
Definitions
thereby becomes entitled to reemployment rights under Federal law. Military
Leave terminates on the expiration of such reemployment rights.
1.36 NORMAL RETIREMENT AGE -- means age 65.
1.37 ORIGINAL PLAN -- means the terms of the 1990 Revised
Harris Corporation Retirement Plan, and any prior plan to the extent
incorporated therein.
1.38 PARTICIPANT -- means an Employee who satisfies the
requirements of Section 2.1. Employees who do not satisfy the requirements of
Article II may, nevertheless, be Participants solely for purposes of making
Rollover Contributions under Section 3.8.
1.39 PARTICIPATING COMPANY -- means the Corporation and any
Related Company or division or operation thereof so designated by the
Corporation. Appendix C, as it may be amended from time to time, lists each
Participating Company, or division thereof, whose Employees may become
Participants.
1.40 PERIOD OF SERVICE -- means the period of time that begins
on the Employee's employment or reemployment date, whichever is applicable, and
ends
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Harris Retirement Plan
23
Definitions
on his Severance from Service Date. The Employee's employment or reemployment
date is the date on which the Employee first performs an Hour of Service.
1.41 PERIOD OF SEVERANCE -- means the period of time commencing
on the Severance from Service Date and ending on the date on which the Employee
again performs an Hour of Service.
1.42 PLAN -- means the Harris Corporation Retirement Plan.
1.43 PLAN YEAR -- means the Fiscal Year.
1.44 PREDECESSOR COMPANY -- means any corporation (a) of which
a Related Company is a successor by reason of having acquired all or
substantially all of its business and assets by purchase, merger, consolidation
or liquidation, or (b) from which a Related Company acquired a business
formerly conducted by such corporation; provided, however, that in the case of
any such corporation that continued to conduct a trade or business subsequent
to the acquisition by a Related Company referred in (a) or (b) above, the
status of such corporation as a Predecessor Company relates only to the period
of time prior to the date of such acquisition.
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Harris Retirement Plan
24
Definitions
1.45 PRE-TAX ACCOUNT -- means the account established to record
the Pre-Tax Contributions made on the Participant's behalf other than those
invested in the Harris Stock Fund.
1.46 PRE-TAX CONTRIBUTIONS -- means the contributions made on
behalf of a Participant under section 3.3.
1.47 PROFIT-SHARING ACCOUNT -- means the account established to
record the Profit-Sharing Contributions made on a Participant's behalf, and
includes the Basic Account and the Supplemental Account.
1.48 PROFIT-SHARING CONTRIBUTIONS -- means the contributions
described in section 3.1.
1.49 RELATED COMPANY -- means the Corporation and any
corporation that is a member of a controlled group of corporations (as defined
in section 414(b) of the Code) with the Corporation; any trade or business
(whether or not incorporated) which is under common control (as defined in
section 414(c) of the Code) with the Corporation; any organization (whether or
not incorporated) which is a member of an affiliated service group (as defined
in section 414(m) of the
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Harris Retirement Plan
25
Definitions
Code) which includes the Corporation, and any other entity required to be
aggregated with the Corporation under section 414(o) of the Code.
1.50 ROLLOVER ACCOUNT -- means the account established to
record the Rollover Contributions made by a Participant from another
tax-qualified plan.
1.51 SAVINGS ACCOUNT -- means the account established under
section 6.1(f).
1.52 SEVERANCE FROM SERVICE DATE -- means, with respect to a
Related Company, the earlier of (a) the date on which the Employee quits,
retires, is discharged or dies, or (b) the first anniversary of the first date
of a period in which an Employee remains absent from service (with or without
pay) for any reason other than quitting, retirement, discharge or death;
provided that "second anniversary" shall be substituted for "first anniversary"
if the absence is due to maternity or paternity reasons as defined in section
410(a)(5)(E) of the Code. The period between the first and the second
anniversary shall not be a Period of Service or a Period of Severance.
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Harris Retirement Plan
26
Definitions
1.53 SUPPLEMENTAL ACCOUNT -- means the account established to
record the portion of the Profit-Sharing Contribution allocable to a
Participant's Excess Compensation.
1.54 TAXABLE WAGE BASE -- means the maximum amount of earnings
that may be considered wages under section 3121(a)(1) of the Code, except for
purposes of Medicare taxes, as in effect on the first day of the Plan Year. In
the case of an Employee who was a Participant for only a portion of a
particular Plan Year, the Taxable Wage Base shall be multiplied by the ratio of
the number of calendar months (including a fraction of a month as a full month)
in the Plan Year during which he was a Participant to 12 months.
1.55 TRUST AGREEMENT -- means the Trust Agreement relating to
the Harris Corporation Retirement Plan, entered into between the Corporation
and the Trustee, as it may be amended from time to time.
1.56 TRUST FUND -- means the assets held by the Trustee in
accordance with the Trust Agreement.
1.57 TRUSTEE -- means Boston Safe Deposit & Trust Company, or
such successor (or successors) thereto designated by the Corporation to act as
trustee
- 16 -
Harris Retirement Plan
27
Definitions
under the provisions of the Trust Agreement, who shall agree to act as such by
executing the Trust Agreement.
1.58 VALUATION DATE -- means the last day of each calendar
month.
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Harris Retirement Plan
28
ARTICLE II
PARTICIPATION
2.1 IN GENERAL. An Employee shall become a Participant in the
Plan on the date he completes a one-year Period of Service, provided that he is
employed by a Participating Company on that date.
2.2 RENEWAL OF PARTICIPATION ON REEMPLOYMENT. An Employee who
terminates employment after he has become a Participant and is reemployed by a
Participating Company shall become a Participant immediately on reemployment.
An Employee who terminates employment before he has become a Participant shall
become a Participant as provided in section 2.1, provided that his Period of
Service prior to reemployment shall be used to satisfy the one-year Period of
Service requirement of Section 2.1 to the extent provided under section 2.3.
2.3 PERIODS OF SERVICE ON REEMPLOYMENT. The following rules
apply to an Employee who terminates employment before he has become a
Participant and is reemployed by a Related Company and, for purposes of section
5.3, to a Participant who terminates employment and is reemployed by a
Participating Company or Related Company:
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Harris Retirement Plan
29
Participation
(a) EARLY REEMPLOYMENT. If the Employee (or
Participant) is reemployed before he incurs a one-year Period of Severance, his
Period of Service before he terminated employment shall be counted as service.
(b) LATER REEMPLOYMENT. If the Employee (or
Participant) is reemployed after he incurs a one-year Period of Severance, his
Period of Service before he terminated shall be counted as service, unless his
Period of Severance equals or exceeds the greater of his prior Period of
Service or five years.
(c) MEASURING THE TIME PERIOD FOR REEMPLOYMENT UNDER
SPECIAL CIRCUMSTANCES. If an Employee terminates employment for any reason
other than quitting, discharge, or retirement, and subsequently quits, is
discharged, or retires, his Period of Severance shall be counted as service
only if he is reemployed by a Related Company within 12 months of when he first
terminated employment.
2.4 SERVICE WITH PREDECESSOR COMPANY. In the case of a
corporation (other than a Related Company) which becomes a Predecessor Company
by reason of the acquisition of all or substantially all of the assets and
business of such corporation by a Related Company, an Employee's Period of
Service shall include employment with such Predecessor Company, as provided in
the corporate documents effecting the acquisition.
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Harris Retirement Plan
30
Participation
2.5 PARTICIPATION FOR PURPOSES OF ROLLOVER CONTRIBUTIONS.
Employees of a Participating Company who do not satisfy the requirements of
Section 2.1 may, nevertheless, be Participants solely for purposes of making
Rollover Contributions under Section 3.8.
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Harris Retirement Plan
31
ARTICLE III
CONTRIBUTIONS AND ALLOCATIONS
3.1 PROFIT-SHARING CONTRIBUTIONS.
(a) BASIC. The amount of Profit-Sharing
Contributions made on behalf of Participating Companies for a Fiscal Year with
respect to Participants in this Plan and the Harris Corporation Union
Retirement Plan shall equal 11-1/2 percent of the adjusted consolidated net
income of the Corporation and its Consolidated Subsidiaries before net income
taxes for such Fiscal Year as determined in subsection (d), reduced by the
portion of such amount that would have been allocable under Section 3.2 with
respect to Participants' Compensation, if Compensation were determined without
regard to statutory limits under section 401(a)(17) or 415 of the Code.
(b) SPECIAL. The Corporation, in its discretion, may
provide for an additional Profit-Sharing Contribution in a specified dollar
amount or pursuant to a formula with respect to any Fiscal Year.
(c) APPORTIONMENT BETWEEN THE PLAN AND THE HARRIS
UNION RETIREMENT PLAN. Profit-Sharing Contributions for a Plan Year shall be
apportioned for accounting and payment purposes between the Plan and the Harris
Corporation Union Retirement Plan (the "Union Plan") based on the ratio
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Harris Retirement Plan
32
Contributions and Allocations
of the total Compensation plus Excess Compensation for the Plan Year of
participants in each plan to the total Compensation plus Excess Compensation of
all participants in the Plan and the Union Plan for the Plan Year.
(d) ADJUSTED CONSOLIDATED NET INCOME. The adjusted
consolidated net income of the Corporation and its Consolidated Subsidiaries
before net income taxes shall be determined on the basis of the annual audit
report prepared by the Corporation's independent public accountants by
adjusting the consolidated net income shown in the report to eliminate the
effect, if any, of the following items:
(1) any provision for taxes on or measured by
income for such years required by the
laws of the United States or of any state
or political subdivision thereof
(including the Ohio Franchise Income Tax,
whether or not in fact measured by
income), or any provision for similar
taxes required by the laws of any other
country;
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Harris Retirement Plan
33
Contributions and Allocations
(2) all items consisting of credits or
deficiencies relating to taxes described
in clause (1) above on or measured by
income for prior Fiscal Years:
(3) any provision for contributions for such
Fiscal Year under this Plan or under any
profit-sharing retirement plan of a
Consolidated Subsidiary of the
Corporation;
(4) all dividends received during such Fiscal
Year with respect to stock of a Related
Company which is not included among the
Consolidated Subsidiaries;
(5) gains or losses from the sale, exchange
or other disposition of capital or
depreciable property, as defined in the
Code;
(6) any income from the use of the "lifo"
inventory method resulting from either a
reduction in inventory or a decrease in
the cost index;
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Harris Retirement Plan
34
Contributions and Allocations
(7) all items of income and expense which
relate directly to the conduct by a
Related Company of a business (i) which
was formerly conducted by a corporation
which was not then a Related Company, and
(ii) the net income (or loss) of which
was included for the first time in
determining the consolidated net income
of the Corporation and its Consolidated
Subsidiaries for the Fiscal Year in
question;
(8) all exchange adjustments resulting from
translating to United States currency
those year-end balance sheet items of
subsidiaries which are denominated in a
foreign currency;
(9) any item of income or expense relating to
the right of any employee to receive cash
upon cancellation of an unexercised stock
option, and
(10) the net of all items of income and
expense, other than tax items described
in subsection (1) and (2) above,
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Harris Retirement Plan
35
Contributions and Allocations
relating to Lanier Business Products, Inc.
and any subsidiary thereof which is a
Related Company.
3.2 ALLOCATION OF PROFIT-SHARING CONTRIBUTIONS TO PARTICIPANTS.
(a) IN GENERAL. The Profit-Sharing Contributions for
a Plan Year with respect to an Employment Unit shall be allocated among
eligible Participants described in subsection (c) who are employed by the
Employment Unit during some part or all of the Plan Year based on the ratio of
each eligible Participant's Compensation plus Excess Compensation for the Plan
Year to the Compensation plus Excess Compensation of all eligible Participants
for the Plan Year.
(b) LIMITATION ON AMOUNT. Notwithstanding subsection
(a), the amount allocated to an eligible Participant with respect to Excess
Compensation shall not exceed the "base contribution percentage" by more than
the lesser of (i) the base contribution percentage or (ii) 5.7% (or if greater,
the percentage equal to the Old Age portion of the tax under Section 3111(a) of
the Code, as in effect on the first day of the Plan Year). The term "base
contribution percentage" means the percentage of Compensation contributed by
the Participating Company with
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Harris Retirement Plan
36
Contributions and Allocations
respect to each Participant's Compensation not in excess of the Participant's
Taxable Wage Base.
(c) LIMITATION ON ELIGIBILITY. A Participant shall
be eligible to receive an allocation of Profit-Sharing Contributions for a Plan
Year if (1) the Participant is employed on the last day of the Plan Year or (2)
the Participant terminates employment during the Plan Year on or after Early
Retirement Age or Normal Retirement Age, or due to Disability, death, Lay-off,
Leave of Absence or Military Leave.
3.3 PRE-TAX CONTRIBUTIONS.
(a) MAXIMUM ELECTION. A Participant may elect to
reduce his Compensation by an amount equal to any whole percentage not to
exceed 12 percent and have the amount of such reduction contributed to the Plan
as a Pre-Tax Contribution. A Participant's Pre-Tax Contribution to the Plan
and other plan of the Participating Company or Related Company for any calendar
year shall not exceed $7,000 (as adjusted in accordance with Code section
402(g)(5) for increases in the cost of living) including the full fair market
value of any Common Stock contributed as a Pre-Tax Contribution. For Pre-Tax
Contributions invested in the Harris Stock Fund, the normal form of
contribution shall be cash; provided,
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Harris Retirement Plan
37
Contributions and Allocations
however, that the Corporation, in its discretion, may make the contribution in
common stock of the Corporation; which may be contributed at a discount from
fair market value.
(b) CONTRIBUTIONS IN EXCESS OF THE MAXIMUM. If the
Pre-Tax Contribution on behalf of a Participant reaches the limit described in
subsection (a), any additional contributions made during the calendar year
pursuant to the Participant's election shall be deemed to be After-Tax
Contributions and any Matching Pre-Tax Contributions with respect to that
amount shall be deemed to be Matching After-Tax Contributions.
3.4 MATCHING PRE-TAX CONTRIBUTIONS. The Participating Company
shall make a Matching Pre-Tax Contribution on behalf of each Participant
employed by it in the amount of 100 percent of the first six percent of the
Pre-Tax Contributions made on behalf of the Participant during the Plan Year.
The normal form of matching contribution for Pre-Tax Contributions invested in
the Harris Stock Fund shall be in cash; provided, however, that the
Corporation in its discretion, may make the contribution in common stock of the
Corporation, which may be contributed at a discount from fair market value.
The Trustee is authorized to purchase common stock of the Corporation in the
open market, and to give effect to the discount, if any, that has been
established from time to time
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Harris Retirement Plan
38
Contributions and Allocations
by allocating shares to Participants' Accounts in addition to the number of
shares purchased on the open market by means of a given contribution.
3.5 AFTER-TAX CONTRIBUTIONS. A Participant may elect to
reduce his Compensation by an amount equal to any whole percentage not to
exceed 12 percent and have the amount of such reduction contributed to the Plan
as an After-Tax Contribution. In no event shall the sum of the Participant's
Pre-Tax Contributions and After-Tax Contributions for a Plan Year exceed 12
percent of Compensation.
3.6 MATCHING AFTER-TAX CONTRIBUTIONS. The Participating
Company shall make a Matching After-Tax Contribution on behalf of each
Participant employed by one of its constituent Employment Units in the amount
of 100 percent of the first six percent of the After-Tax Contributions on
behalf of the Participant, reduced by the amount of the Matching Pre-Tax
Contribution made on behalf of the Participant during the Plan Year. The
normal form of matching contribution for After-Tax Contributions invested in
the Harris Stock Fund shall be in cash; provided, however, that the Corporation
in its discretion, may make the contribution in common stock of the
Corporation, which may be contributed at a discount from fair market value.
The Trustee is authorized to purchase common stock of the Corporation in the
open market, and to give effect to the discount, if
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Harris Retirement Plan
39
Contributions and Allocations
any, that has been established from time to time by allocating shares to
Participants' Accounts in addition to the number of shares purchased on the
open market by means of a given contribution.
3.7 ELECTIONS TO MAKE PRE-TAX AND AFTER-TAX CONTRIBUTIONS.
(a) WRITTEN ELECTIONS. A Participant's initial
election to reduce his Compensation and have Pre-Tax Contributions and/or
After-Tax Contributions made on his behalf shall be made in writing by filing
the appropriate form, which shall specify the effective date of the election.
The initial election shall take effect as of the first payroll period
commencing immediately after the effective date of the election.
(b) CHANGING ELECTIONS. A Participant may change the
percentage (in increments of one percent) of future Pre-Tax Contributions
and/or After-Tax Contributions made on his behalf by filing the appropriate
form or by following the appropriate telephone procedures for changing
elections as established by the Corporation Committee. A change may be made
not more than once each month. A change of election shall become effective as
of the first payroll period commencing immediately after the effective date of
the election.
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Harris Retirement Plan
40
Contributions and Allocations
(c) TERMINATING ELECTIONS. A Participant may
terminate his election to have Pre-Tax Contributions and/or After-Tax
Contributions made on his behalf by filing the appropriate form. The
termination election shall become effective as of the first payroll period
commencing immediately after the effective date of the election.
(d) CORPORATION'S DISCRETION TO LIMIT ELECTIONS. The
Corporation Committee may direct that Participant elections with respect to
Pre-Tax Contributions and/or After-Tax Contributions be changed in any manner
the Corporation Committee, in its discretion, shall determine appropriate to
preserve the qualification of the Plan under section 401(a) of the Code and as
a cash or deferred arrangement under section 401(k) of the Code.
3.8 ROLLOVER CONTRIBUTIONS. Employees, with the consent of
the Corporation Committee or its delegate, may at any time make a rollover
contribution to the Plan. Rollover contributions shall include only (1) cash
funds transferred directly from a tax-qualified plan within the meaning of
section 401 of the Code, and (2) cash funds distributed from a tax-qualified
plan or a conduit individual retirement account that are eligible for rollover
treatment and are transferred to the Plan within 60 days of the Employee's
receipt thereof. An Employee may be required to establish that the transfer of
amounts into a
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Contributions and Allocations
Rollover Account will not require any changes to the terms of the Plan or risk
adverse consequences for the Plan or Trust.
3.9 PARTICIPATING COMPANY'S OBLIGATION TO MAKE
CONTRIBUTIONS.
(a) CONTRIBUTIONS. Each Participating Company agrees
to pay to the Trustee the contributions that are required with respect to
Participants who are employed by one of its constituent Employment Units.
Profit-Sharing Contributions with respect to a Fiscal Year shall be paid to the
Trustee no later than the time for filing the Participating Company's federal
income tax return for such Fiscal Year, including extensions. Pre-Tax
Contributions and After-Tax Contributions shall be withheld and paid by the
Employment Unit, and Matching Contributions shall be paid by the Participating
Company to the Trustee no later than 20 days following the last day of the
calendar month in which the amounts were withheld from the Participants'
Compensation.
(b) LIMITATION. Contributions under this Article III
shall not be required to the extent they exceed the limitations of section 404
of the Code, in which case they shall be reduced to the extent allowable and
necessary in the
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42
Contributions and Allocations
following order: (1) Profit-Sharing Contributions; (2) Matching Contributions,
and (3) Pre-Tax Contributions.
3.10 TREATMENT OF FORFEITED AMOUNTS.
(a) REDUCTION OF CONTRIBUTIONS. Forfeitures shall be
allocated to Employment Units as provided in subsection (b) and used to reduce
Profit-Sharing Contributions and Matching Contributions of the Participating
Companies in which the Employment Units are included.
(b) ALLOCATION OF FORFEITURES TO EMPLOYMENT UNITS.
Forfeitures of Profit-Sharing Contributions and Matching Contributions shall be
credited to the Employment Unit with which the Participant was last employed
before the forfeiture occurred.
3.11 FINALITY OF ALLOCATIONS
The Corporation Committee shall give a written benefit
statement to each Participant at least annually setting forth the amount of the
contributions allocated to his Accounts; provided, however, that if any such
Participant is deceased, such statement shall be given to his Beneficiary. Any
Participant or Beneficiary claiming that an error has been made in a benefit
statement shall
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Contributions and Allocations
notify the Corporation Committee in writing within 90 days following the
delivery or mailing of such statement. The Corporation Committee shall review
the claim and advise the Participant or Beneficiary of its decision in writing.
If no such notice of error is filed, the benefit statement shall be presumed to
be correct.
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ARTICLE IV
LIMITATIONS ON CONTRIBUTIONS
4.1 IN GENERAL. Notwithstanding any provisions of Article III
to the contrary, the contributions provided for in Article III shall be limited
to the extent necessary to meet the requirements of this Article IV.
4.2 PRE-TAX CONTRIBUTIONS.
(a) TREATMENT OF CERTAIN CONTRIBUTIONS AS AFTER-TAX.
If the Corporation Committee determines that a Participant's Pre-Tax
Contributions for a calendar year have reached the dollar limit of section
402(g) of the Code, any additional contributions for that calendar year
pursuant to the Participant's Pre-Tax Contribution election shall be deemed to
be After-Tax Contributions and the Matching Contributions with respect to that
amount, if any, shall be deemed to be Matching After-Tax Contributions.
(b) RETURN OF EXCESS DEFERRALS. In the event that a
Participant's Pre-Tax Contributions already made to the Plan for a calendar
year exceed the limits of section 402(g) of the Code, the excess amount, as
adjusted for income and loss, may, in the discretion of the Corporation
Committee, be distributed to the Participant no later than April 15 of the
following year in
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45
Limitations on Contributions
accordance with the requirements of section 402(g) of the Code and Treasury
Regulation section 1.402(g)1.
4.3 PERCENTAGE LIMITATION ON PRE-TAX CONTRIBUTIONS.
(a) SATISFYING THE ACTUAL DEFERRAL PERCENTAGE TEST.
The Pre-Tax Contributions made on behalf of Participants with respect to a Plan
Year shall satisfy the "actual deferral percentage test" of section 401(k)(3)
of the Code and Treasury regulation section 1.401(k)-1(b)(2), the provisions of
which are incorporated herein by reference.
(b) TREATMENT OF EXCESS CONTRIBUTIONS AS AFTER-TAX.
In the event it is necessary to reduce or limit the amount of any Participant's
Pre-Tax Contributions, the amount of Pre-Tax Contributions made on behalf of
Highly Compensated Employees shall be deemed to be After-Tax Contributions and
any Matching Pre-Tax Contributions made with respect to those Contributions
shall be deemed to be Matching After-Tax Contributions. The Highly Compensated
Employees to whom this recharacterization is applicable shall be determined in
accordance with Treasury regulation section 1.401(k)-1(f)(2), the provisions of
which are incorporated herein by reference.
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Limitations on Contributions
4.4 PERCENTAGE LIMITATION ON AFTER-TAX AND MATCHING
CONTRIBUTIONS.
(a) SATISFYING THE ACTUAL CONTRIBUTION PERCENTAGE
TEST. The After-Tax Contributions and Matching Contributions made on behalf of
Participants with respect to a Plan Year shall satisfy the "actual contribution
percentage test" of section 401(m)(3) of the Code and Treasury regulation
section 1.401(m)-1(b), the provisions of which are incorporated herein by
reference.
(b) REDUCTION AND FORFEITURE OF AFTER-TAX
CONTRIBUTIONS AND MATCHING CONTRIBUTIONS. In the event it is necessary to
reduce or limit a Participant's After-Tax Contributions and Matching
Contributions to satisfy the actual contribution percentage test, the amount of
such contributions, as adjusted for income and losses, on behalf of Highly
Compensated Employees shall be reduced in accordance with Treasury regulation
section 1.401(m)-1(e)(2), the provisions of which are incorporated herein by
reference. The amount of the After-Tax Contributions and Matching Contribution
shall be returned to the Highly Compensated Employees (including return by
transfer to a non-qualified deferred compensation plan, in accordance with a
timely election filed by the Participant) or forfeited as follows:
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Limitations on Contributions
(1) After-Tax Contributions in excess of six
percent of Compensation shall be
returned, and
(2) Remaining After-Tax Contributions and
Matching After-Tax Contributions
attributable thereto. After-Tax
Contributions shall be returned.
Matching After-Tax Contributions to the
extent vested shall be returned and to
the extent not vested shall be forfeited
and used to reduce contributions in
accordance with section 3.10.
4.5 MULTIPLE USE OF ALTERNATIVE LIMITATIONS.
Multiple use of the alternative limitations of sections
401(k)(3)(A)(iii)(II) and 401(m)(A)(ii) of the Code shall be restricted in
accordance with Treasury Regulation 1.401(m)-2, the provisions of which are
incorporated herein by reference.
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Limitations on Contributions
4.6 LIMITATIONS ON ANNUAL ADDITIONS.
(a) The Defined Contribution Limit. The "annual
addition," as defined herein, for any Plan Year, to a Participant's Accounts in
all defined contribution plans maintained by the Participating Company or
Related Company shall not exceed the lesser of (i) 25 percent of the
Participant's Compensation for the Plan Year, or (ii) $30,000 (as adjusted in
accordance with section 415(d) of the Code). The term "annual additions" means
the sum of all contributions and forfeitures allocated to a Participant's
Accounts (other than his Rollover Account).
(b) The Combined Limit. If the Participant also has
participated in a defined benefit plan maintained by a Related Company, the
limitations of section 415(e) of the Code shall apply. If the limitations of
section 415(e) are exceeded, the benefits under any defined benefit plan
maintained by the Participating Company or Related Company shall be reduced
before the annual additions to the Plan are reduced.
(c) Reduction of Contributions. If the Corporation
Committee determines at any time that the annual addition to any Participant's
Accounts exceeds such limitation for any Plan Year, the contributions on behalf
of the Participant shall be reduced, to the extent necessary, in the following
order:
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Limitations on Contributions
(1) Pre-Tax Contributions in excess of six
percent;
(2) Remaining Pre-Tax Contributions and
Matching Pre-Tax Contributions
attributable thereto shall be reduced
proportionately;
(3) Profit-Sharing Contributions;
(4) After-Tax Contributions in excess of six
percent;
(5) Remaining After-Tax Contributions and
Matching After-Tax Contributions
attributable thereto shall be reduced
proportionately.
After-Tax Contributions and Pre-Tax Contributions, as adjusted for
gains, shall be returned to the Participant (including return by transfer to a
non-qualified deferred compensation plan, in accordance with a timely election
filed by the Participant). Profit-Sharing Contributions and Matching
Contributions, as adjusted for gains, to the extent allowable shall be held in
a suspense account and allocated to the Accounts of such Participant in the
next Plan Year; provided that if the Participant is not covered by the Plan in
the next Plan Year, the amount shall be allocated to the remaining Participants
in the Plan who are employed by the Employment Unit that employed the
Participant.
(d) LIMITS ON LIMITS. The limits stated on this
Article IV shall apply only to the extent required under the Code. Except as
otherwise specifically
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Limitations on Contributions
provided in this section 4.6, all of the requirements of section 415 of the
Code, and limitations thereon, including the transitional rules and grandfather
rules, are incorporated herein by reference.
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ARTICLE V
VESTING AND FORFEITURES
5.1 IN GENERAL. A Participant shall have a fully vested
interest at all times in his Pre-Tax Account, After-Tax Account, Harris Stock
Pre-Tax Account, Harris Stock After Tax Account and Savings Account (other than
the portion attributable to matching contributions made after October 1, 1984)
and Rollover Account.
5.2 VESTING ON RETIREMENT, DEATH OR DISABILITY. A Participant
shall have a fully vested interest in his Profit Sharing Account, Matching
Pre-Tax Account, Matching After-Tax Account, Harris Stock Matching Pre-Tax
Account, Harris Stock Matching After-Tax Account and portion of his Savings
Account attributable to matching contributions made after October 1, 1984, on
termination of employment by any Related Company in the event of:
(a) retirement on or after Normal Retirement Age;
(b) retirement on or after Early Retirement Age;
(c) retirement on or after the effective date of a
Participant's Disability determination by the Social Security Administration.
(d) death.
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Vesting and Forfeitures
5.3 VESTING ON OTHER TERMINATION OF EMPLOYMENT.
(a) VESTING SCHEDULE. A Participant who terminates
employment other than on the occurrence of one of the events described in
section 5.2 shall have a vested interest in his Profit-Sharing Account,
Matching Pre-Tax Account, Matching After-Tax Account, Harris Stock Matching
Pre-Tax Account, Harris Stock Matching After-Tax Account and the portion of his
Savings Account attributable to matching contributions made after October 1,
1984 in accordance with the following schedule:
Period of Service Vested Percentage
Less than 3 years 0%
3 years but less than 4 years 30%
4 years but less than 5 years 40%
5 years but less than 6 years 60%
6 years but less than 7 years 80%
7 years or more 100%
(b) COMPUTING A PARTICIPANT'S PERIOD OF SERVICE. For
the purpose of determining a Participant's Period of Service under subsection
(a), the rules of section 2.3 shall apply.
(c) VESTING ON SALE OF BUSINESS. In the event of the
sale or disposition of a business or a sale of substantially all of the assets
of a trade or
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Vesting and Forfeitures
business, the Corporation may, in its discretion, provide for accelerated
vesting with respect to those Participants affected by the sale.
5.4 EFFECT OF IN-SERVICE WITHDRAWALS ON A PARTICIPANT'S VESTED
PERCENTAGE. If a Participant receives a withdrawal under Article IX or
distribution under Article VII from his Profit-Sharing Account at a time when
the Participant has less than a fully vested interest in that account, the
dollar amount of his vested interest in his Profit-Sharing Account (X) shall be
determined at any time by the following formula:
X = P(AB + D) - D
For the purpose of applying the formula, P is the Participant's
vested interest in his Profit-Sharing Account at the time the determination is
made, AB is the balance credited to the Profit-Sharing Account at the time the
determination is made, and D is the amount of the withdrawal.
5.5 FORFEITURES.
(a) TIMING OF FORFEITURE. Effective July 1, 1985, a
Participant who terminates employment with less than a fully vested interest in
his Accounts shall forfeit the nonvested interest on the earlier of the date on
which the Participant:
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Vesting and Forfeitures
(1) receives a lump sum distribution of all
or a portion of the vested interest in
such Accounts, provided that such
distribution is made no later than the
close of the second Plan Year following
the year in which the Participant
terminates employment;
(2) incurs five consecutive one-year
Periods of Severance; or
(3) at any earlier date allowable under
the Code.
(b) EFFECT OF PARTIAL DISTRIBUTION ON A PARTICIPANT'S
VESTED PERCENTAGE. If the Participant elects to receive a lump sum
distribution of less than the full amount of his vested interest, the part of
his nonvested interest that shall be forfeited under subsection (a)(1) is the
total nonvested interest multiplied by a fraction, the numerator of which is
the amount of the distribution and the denominator of which is the total value
of his vested interest in his Accounts other than his After-Tax Account, Harris
Stock After-Tax Account and Rollover Account.
(c) EFFECT OF REPAYMENT OF DISTRIBUTION. If a
Participant incurs a forfeiture under subsection (a)(1), then returns to
employment with a
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Harris Retirement Plan
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Vesting and Forfeitures
Participating Company and becomes a Participant in the Plan before incurring
five consecutive one-year Periods of Severance, the forfeited amount shall be
restored by the Employment Unit of the Participating Company with which the
Participant is reemployed.
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ARTICLE VI
ACCOUNTS AND INVESTMENTS
6.1 ESTABLISHMENT OF ACCOUNTS. The Committee shall establish
and maintain for each Participant the following Accounts showing the
Participant's interest under the Plan:
(a) Profit-Sharing Account, which shall consist of
(1) a Basic Account to reflect the portion of
Profit-Sharing Contributions allocable to
the Participant's Compensation, and
(2) a Supplemental Account to reflect the
portion of Profit-Sharing Contributions
allocable to the Participant's Excess
Compensation;
(b) Pre-Tax Account to reflect Pre-Tax Contributions
made on the Participant's behalf other than those invested in the Harris Stock
Fund;
(c) After-Tax Account to reflect After-Tax
Contributions made on the Participant's behalf other than those invested in the
Harris Stock Fund;
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Accounts and Investments
(d) Matching Pre-Tax Account to reflect Matching
Pre-Tax Contributions made on the Participant's behalf other than those
invested in the Harris Stock Fund;
(e) Matching After-Tax Account to reflect Matching
After-Tax Contributions made on the Participant's behalf other than those
invested in the Harris Stock Fund;
(f) Savings Account to reflect the Savings
Contributions under the Plan as in effect prior to July 1, 1990, and the
aggregate of the Participant's voluntary and required contributions to the
Harris Video Systems Savings/Incentive Plan less withdrawals, as of June 30,
1990;
(g) Harris Stock Pre-Tax Account to reflect the
portion of the Pre-Tax Contributions made on the Participant's behalf invested
in the Harris Stock Fund;
(h) Harris Stock After-Tax Account to reflect the
portion of the After-Tax Contributions made on the Participant's behalf
invested in the Harris Stock Fund;
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58
Accounts and Investments
(i) Harris Stock Matching After-Tax Account to
reflect the portion of the Matching After-Tax Contributions made on the
Participant's behalf invested in the Harris Stock Fund;
(j) Harris Stock Matching Pre-Tax Account to reflect
the portion of the Matching Pre-Tax Contributions made on the Participant's
behalf invested in the Harris Stock Fund, and
(k) Rollover Account to reflect the Participant's
Rollover Contributions.
6.2 INVESTMENT OF PROFIT-SHARING ACCOUNT.
(a) IN GENERAL. Except as provided in subsection
(b), the amounts allocated to a Participant's Profit-Sharing Account shall be
invested in the Balanced Fund.
(b) PARTICIPANT-DIRECTED INVESTMENTS AT AGE 55. On
attaining age 55, a Participant shall be entitled to direct the investment of
his Profit-Sharing Account in accordance with the procedures set out in section
6.3.
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Accounts and Investments
The Profit-Sharing Account shall remain invested in the Balanced Fund until the
Participant changes his or her election with respect thereto.
6.3 INVESTMENT OF ACCOUNTS OTHER THAN PROFIT-SHARING ACCOUNT.
Except as provided in section 6.2, effective October 1, 1993, each Participant
shall have the right to direct the investment of his Accounts and future
contributions to his Accounts among the Investment Funds in accordance with the
following procedures and such other procedures provided in the documents
pertaining to each Investment Fund:
(a) WRITTEN OR TELEPHONIC DIRECTION. Each election
shall be completed by filing the appropriate election form or by following the
appropriate telephone procedures for direct transfer as established by the
Corporation Committee.
(b) ELECTIONS IN 10% INCREMENTS FOR CURRENT BALANCES.
An election with respect to current account balances, including the
Participant's initial election with respect to the balance arising from a
Rollover Contribution, shall be made in increments of ten percent of the
account balance;
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60
Accounts and Investments
(c) ELECTIONS IN 10% INCREMENTS FOR FUTURE
CONTRIBUTIONS. An election with respect to future contributions shall be made
in increments of ten percent of the contribution (after the contribution is
reduced by the dollar amount directed into the Harris Stock Fund), provided
that the combined Pre-Tax Contributions and After-Tax Contributions invested in
the Harris Stock Fund shall equal no more than one percent of Compensation. To
the extent Pre-Tax Contributions and After-Tax Contributions are invested in
the Harris Stock Fund, the Matching Contributions attributable thereto also
shall be invested in the Harris Stock Fund;
(d) CHANGING ELECTIONS. A change of election may be
made at any time; provided that an election change shall become effective only
on the first day of the month. To be effective on the first day of any month,
a written election must be made on or before the 20th day of the preceding
month, and a telephonic election must be made on or before the 25th day of the
preceding month. If more than one election change is made on or before the
applicable deadline, the most recent election change shall be given effect.
(e) ELECTIONS APPLY TO ALL ACCOUNTS. Each of the
Participant's Accounts (including his Profit-Sharing Account on the
Participant's attaining age 55) shall be invested among the Investment Funds in
the same manner, such that
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Accounts and Investments
each election by a Participant with respect to the Investment Funds shall apply
to all of his Accounts in the same proportion.
(f) INVESTMENT IN BALANCED FUND ABSENT ELECTION. A
Participant's Accounts and contributions made on behalf of the Participant
shall be invested in the Balanced Fund until the Participant makes a valid
investment election pursuant to this section 6.3 and any other procedures
established by the Corporation Committee.
6.4 ALLOCATION OF EARNINGS AND LOSSES. Earnings and losses
shall be allocated at least annually. In determining a Participant's share of
the earnings or losses of each of the Investment Funds as of any Valuation
Date, the total earnings or losses of the particular Investment Fund, net of
expenses allocable to that fund, shall be allocated among the Participants'
Accounts invested in that Investment Fund based on the ratio of each
Participant's Accounts to the aggregate of the Accounts of all Participants,
before taking into account any contributions that are required to be but are
not yet made as of the Valuation Date and before taking into account any
distributions, withdrawals or loans to Participants for the period coinciding
with the Valuation Date. Contributions to Accounts are not credited with
earnings in the month in which they are credited to any Account.
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Accounts and Investments
6.5 SPECIAL RULES CONCERNING HARRIS STOCK FUND.
Notwithstanding any other provision of section 6.2 and 6.3 to the contrary, the
following rules shall apply to investments in the Harris Stock Fund:
(a) AVAILABILITY. Only Pre-Tax Contributions,
After-Tax Contributions and Matching Contributions made with respect to
Compensation earned on or after October 1, 1993 may be invested in this fund.
For any Plan Year, the combined Pre-Tax Contributions and After-Tax
Contributions invested in this fund on behalf of a Participant in each Plan
Year shall equal no more than one percent of the Participant's Compensation for
such Plan Year. An election to invest in the Harris Stock Fund shall take
effect as soon as administratively feasible after the election is received.
(b) RESTRICTIONS ON TRANSFERS. A Participant may not
transfer amounts from other Investment Funds to the Harris Stock Fund. Any
contributions invested in this Fund must remain in this fund for a minimum of
36 months, provided that amounts invested in this fund may be distributed to
the Participant before the expiration of the 36-month period, if the
Participant is otherwise entitled to a distribution under the Plan.
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Accounts and Investments
(c) DIVIDENDS. A Participant's allocable share of
cash dividends (and other cash earnings) credited to the Harris Stock Fund,
will be reinvested in the Harris Stock Fund unless the Participant elects with
respect to the dividends credited to his Account for a quarter to invest such
cash dividends (and other cash earnings) among the Investment Funds other than
the Harris Stock Fund in increments of ten percent of the amount of the
dividends (and other earnings). Only cash dividends (and earnings) that have
been credited to the Participant's Accounts for at least one month are subject
to the Participant's investment election under this subsection (c). Each
election shall be completed by filing the appropriate form or by following the
appropriate telephone procedures as established by the Corporation Committee,
pursuant to section 6.3(d). Dividends paid in the form of stock shall be
retained in a Participant's Account until liquidated, in the sole discretion of
the Trustee. Such liquidated dividends shall be cash earnings subject to
investment elections in accordance with this subsection of the Plan.
(d) CONTRIBUTIONS. The normal form of contributions
for amounts invested in the Harris Stock Fund shall be in cash; provided,
however, that the Corporation, in its discretion, may make the contribution in
common stock of the Corporation, which may be contributed at a discount from
fair market value. The Trustee is authorized to purchase common stock of the
Corporation in
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Accounts and Investments
the open market, and to give effect to the discount, if any, that has been
established from time to time by allocating shares to Participants' Accounts in
addition to the number of shares purchased on the open market by means of a
given contribution.
(e) DISTRIBUTIONS. Distributions from the Harris
Stock Fund shall be in the form of cash or shares of Harris Stock at the
election of the Participant. Fractional shares and distributions of a de
minimis amount as determined by the Corporation Committee shall be paid in
cash.
(f) VOTING. Participants may submit non-binding
proxies to the Trustee, which will vote the shares in the Harris Stock Fund in
the exercise of its sole discretion.
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65
ARTICLE VII
DISTRIBUTIONS
7.1 IN GENERAL. A Participant shall be entitled to receive a
distribution of the vested interest in his Accounts on the earlier of
termination of employment or attainment of age 59 1/2, except that his Pre-Tax
Contributions and Matching Pre-Tax Contributions are distributable only as
allowed under section 401(k) of the Code. Distributions shall be made upon the
sale or disposition of the stock in a subsidiary, or the sale or disposition of
substantially all the assets of a trade or business, as provided, under the
corporate documents effecting the sale or disposition and in accordance with
Section 401(k)(10) of the Code. A termination of employment shall not be
deemed to occur for purposes of this section 7.1 and section 7.2 until the
Participant is no longer employed by a Related Company. A Participant may
elect to receive any amount invested in the Harris Stock Fund in the form of
stock; provided that fractional shares and distributions of a de minimis amount
as determined by the Corporation Committee shall be paid in cash.
7.2 SMALL BENEFIT CASH-OUT. Except as provided in section
7.5, in any case in which a Participant's vested interest in his Accounts does
not (and did not at the time of any prior distributions) exceed $3,500 (or such
larger amount as may be permitted by law), the vested interest shall be paid to
the Participant in a lump sum as soon as reasonably practicable upon
termination of employment.
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Distributions
7.3 FORM OF PAYMENT.
(a) OPTIONS. In any case in which a Participant's
vested interest in his Accounts exceeds the amount provided in Section 7.2, the
Participant may elect at any time to receive payment in:
(1) a lump sum of any portion or all of the
balance of the Participant's Accounts;
(2) substantially equal periodic installment
payments over a period of time
to be elected by the Participant;
(3) a combination of (a) and (b), or
(4) a direct rollover.
(b) CHANGES ALLOWED. A Participant may change his
election with respect to the form of payment at any time before or after
distribution of benefits commences, subject to the provisions of section 7.9.
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Distributions
(c) EFFECT OF FAILURE TO SPECIFY AN OPTION. If a
Participant fails to file an election under this section 7.3, his benefits
shall be paid in accordance with section 7.4.
7.4 TIME OF PAYMENT. On termination of employment, a
Participant, other than one described in section 7.2, may elect that payment of
benefits begin immediately or at any other time. If a Participant fails to
file an election under this section 7.4 and payment of benefits has not already
commenced, payment of his benefits shall commence on April 1 of the calendar
year following the year in which the Participant attains 70 1/2 and shall be
paid in accordance with the minimum distributions requirements of section
401(a)(9) of the Code.
7.5 DIRECT ROLLOVER.
(a) Effective January 1, 1993, a Participant or
"distributee" may elect at any time to have any portion of an "eligible
rollover distribution" paid in a direct rollover to the trustee or custodian of
an "eligible retirement plan" specified by the Participant or distributee,
whichever is applicable. Payment of a direct rollover in the form of a check
payable to the trustee or custodian of an eligible retirement plan, for the
benefit of the Participant or distributee, may be mailed to the Participant or
distributee.
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Distributions
(b) For purposes of this section 7.5, the following
terms shall have the following meanings:
(1) "Distributee" means a surviving spouse or
a spouse or former spouse who is an
alternate payee under a Qualified
Domestic Relations Order defined in
section 414(p) of the Code.
(2) "Eligible retirement plan" means an
individual retirement account described
in section 408(a) of the Code, an
individual retirement annuity described
in section 408(b) of the Code, an annuity
plan described in section 403(a) of the
Code, or a qualified trust described in
section 401(a) of the Code that accepts
an eligible rollover distribution;
provided that if the distributee is a
surviving spouse, an eligible retirement
plan means an individual retirement
account or individual retirement annuity.
(3) "Eligible rollover distribution" means
any distribution of all or a portion of
the Participant's Accounts, other
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Distributions
than the portion of his After-Tax Account
and Harris Stock After-Tax Account
attributable to After-Tax Contributions,
but does not include a distribution (i)
in installments over a period of ten
years or more or over a period described
in section 7.9(c), or (ii) to the extent
the distribution is required under
section 401(a)(9) of the Code.
7.6 PAYMENTS ON DEATH. If a Participant dies before he has
received the full amount of the vested interest in his Accounts, the unpaid
amount shall be paid to his Beneficiary in the manner provided in this Article
VII (including section 7.5 only if the Beneficiary is the spouse) as though the
Beneficiary were the Participant.
7.7 BENEFIT AMOUNT AND WITHHOLDING.
(a) Vested Amount and Adjustments. For purposes of
this Article VII, a Participant's vested interest in his Accounts shall be
determined as of the Valuation Date coinciding with or immediately following
the date of the event giving rise to the distribution, plus any Profit-Sharing
Contribution to which the Participant may be entitled under section 3.2 that
has not yet been credited to
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the Participant's Profit-Sharing Account. Any unpaid amount in the
Participant's Accounts shall continue to be adjusted for earnings and losses as
provided in section 6.4 until it is distributed.
(b) WITHHOLDING. The amount of any distribution
shall be reduced to the extent necessary to comply with Federal, state and
local income tax withholding requirements.
7.8 ORDER OF DISTRIBUTIONS. Any distribution under this Plan
shall be charged against the Participant's Accounts pursuant to administrative
procedures designed to maximize the tax benefits to the Participant by
distributing to him first his After-Tax Contributions to the extent permitted
by law.
7.9 STATUTORY REQUIREMENTS. Notwithstanding any other
provisions of the Plan to the contrary, the following rules shall apply to all
payments under the Plan:
(a) LATEST COMMENCEMENT DATE. Unless the Participant
files a written election to defer payment of benefits, benefits payments with
respect to any Participant shall commence no later than the 60th day after the
close of the Plan Year in which the latest of the following occurs:
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(1) the date on which the Participant attains
Normal Retirement Age;
(2) the 10th anniversary of the date on which
the Participant commenced
participation in the Plan, or
(3) the date on which the Participant
terminated employment.
Failure to file an election under section 7.4 for payment of benefits to
commence shall be deemed to be a written election to defer payment of benefits
under this subsection (a).
(b) REQUIRED BEGINNING DATE. Notwithstanding
subsection (a) above, payment of benefits to a Participant shall commence no
later than April 1 of the calendar year following the calendar year in which
the Participant attains age 70 1/2.
(c) MAXIMUM DURATION OF DISTRIBUTIONS. Payment of a
Participant's benefit shall be made over a period not to exceed one of the
following periods:
(1) the life of the Participant;
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(2) the life of the Participant and the
Participant's Beneficiary;
(3) a period certain not extending beyond the
life expectancy of the Participant, or
(4) a period certain not extending beyond the
joint and last survivor expectancy of the
Participant and his Beneficiary.
The amount to be distributed each year must be at least equal to the
quotient obtained by dividing the Participant's benefit by the life expectancy
of the Participant or the joint and last survivor expectancy of the Participant
and his Beneficiary. Life expectancy and joint and last survivor expectancy
shall be computed by the use of the return multiples contained in Treasury
regulation section 1.72-9. For purposes of this computation, a Participant's
and a spouse's life expectancy may be recalculated annually; however, the life
expectancy of a Beneficiary, other than the Participant's spouse, may not be
recalculated. If the Participant's spouse is not the Beneficiary, the method
of distribution selected must ensure that at least 50 percent of the present
value of the amount available for distribution is paid within the life
expectancy of the Participant.
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Distributions
(d) DISTRIBUTION AFTER THE PARTICIPANT'S DEATH. In
the event a Participant who is receiving benefits dies, the remaining balance
of his benefits shall be distributed at least as rapidly as under the method of
distribution elected by the Participant. If a Participant dies before
distribution of benefits commences, the Participant's entire interest will be
distributed no later than five years after the Participant's death, except to
the extent that an election is made to receive distributions in accordance with
(1) or (2) below:
(1) if any portion of the Participant's
benefit is payable to a Beneficiary,
installment distributions may be made
over the life or life expectancy of the
Beneficiary, provided that the
installments commence no later than one
year after the Participant's death, and
(2) if the Beneficiary is the Participant's
spouse, the commencement of distributions
may be delayed until the date on which
the Participant would have attained age
70 1/2. If the spouse dies before
payments begin, subsequent distribution
shall be made as if the spouse had been
the Participant.
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Distributions
For purposes of the foregoing, payments may be calculated by use of
the return multiples specified in Treasury regulation section 1.72-9. Life
expectancy of a spouse may be recalculated annually. However, in the case of
any other Beneficiary, such life expectancy shall be calculated at the time
payment first commences without further recalculation. Any amount paid to a
child of the Participant shall be treated as if it had been paid to the
surviving spouse if the amount becomes payable to the spouse when the child
reaches the age of majority.
(e) LIMIT ON LIMITS. All distributions under this
section 7.9 shall be determined and made in accordance only to the extent
required under section 401(a)(9) of the Code, including the minimum
distribution incidental benefit requirement of Treasury regulation section
1.401(a)(9)2, the provisions of which are incorporated herein by reference.
7.10 DESIGNATING BENEFICIARIES.
(a) WRITTEN DESIGNATION. Each Participant may, by
filing a written notice with the Corporation Committee, designate a Beneficiary
or Beneficiaries to receive any benefits payable as a result of the death of
the Participant. This designation may be changed by the Participant at any
time by giving written notice to the Corporation Committee. Any designation of
a
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Beneficiary other than the Participant's spouse must be consented to by the
spouse in writing and witnessed by a notary public (or a representative of the
Plan prior to October 1, 1993). Any consent required under this section 7.10
shall be valid only with respect to the spouse who signed it. Spousal consent
shall not be required if the Participant establishes to the satisfaction of a
Plan representative that such consent may not be obtained because (a) there is
no spouse; (b) the spouse cannot be located, or (c) there exists such other
circumstances as the Secretary of the Treasury may prescribe as excusing the
requirement for such consent. A Participant may revoke any prior election
without obtaining the consent of the spouse to such revocation. In the absence
of a new election that meets the requirements of this section 7.10, the spouse
shall be the Beneficiary.
(b) DEATH PRIOR TO DESIGNATING BENEFICIARY. In the
event the Participant dies with no beneficiary designation on file, the
Participant's Beneficiary shall be the Participant's surviving spouse, if any,
and if there is no surviving spouse, the Participant's estate.
7.11 PAYMENT OF GROUP INSURANCE PREMIUMS. If a retired
Participant is eligible to be included in any contributory group insurance
program maintained or sponsored by an Employment Unit, a retired Participant
who is receiving benefits under the Plan in installments and who elects to be
covered under such
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contributory group insurance program may direct that a specified portion of the
installment payments be withheld and paid by the Trustee on his behalf to the
Employment Unit as his contribution under such group insurance program. Such
direction by a retired Participant shall be in writing on a form prescribed by
the Corporation Committee. Any such direction may be revoked by the retired
Participant not less than 15 days prior to the effective date of such
revocation. Any withholding and payment of insurance costs on behalf of a
retired Participant shall be made in accordance with Treasury regulation
section 1.401(a)-13.
7.12 INABILITY TO LOCATE PARTICIPANT. If, when any payment
becomes due, the Corporation Committee is unable to locate the Participant or
Beneficiary after exercising reasonable diligence, payment shall be stopped and
future payments to such individual discontinued. Any remaining unpaid benefits
with respect to such Participant or Beneficiary shall be deemed to be
forfeited, provided that if the Participant or Beneficiary later notifies the
Corporation Committee of his address, to the extent required by law payment of
the forfeited amount shall be reinstated by the Participating Company with
which the Participant was last employed.
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ARTICLE VIII
LOANS
8.1 IN GENERAL. Each "party in interest," as defined in
section 3(14) of ERISA, with respect to the Plan for whom a Pre-Tax Account,
After-Tax Account and/or Rollover Account is maintained may request that a loan
be made to him from his Pre-Tax Account, After-Tax Account and/or Rollover
Account by filing an appropriate application, pursuant to procedures adopted by
the Corporation Committee. All loan requests shall be approved on a reasonably
equivalent basis (within the meaning of section 4975(d)(1)(A) of the Code and
section 408(b)(1)(A) of ERISA), subject to the conditions set forth in this
Article VIII.
8.2 LOAN ADMINISTRATION. The Corporation Committee shall be
responsible for administering the loan program, but may delegate the operation
of the program to the Plan's record-keeper. The procedures for applying for a
loan and the basis on which loans will be approved or denied shall be described
in the summary plan description for the Plan or in other documents prepared by
or at the direction of the Corporation for this purpose and such additional
documents are hereby incorporated by reference to the extent required by the
Department of Labor.
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Loans
8.3 TERMS AND CONDITIONS OF LOANS. The terms and conditions
of each loan shall be set forth in the promissory note and security agreement
evidencing the loan and shall include, but not be limited to, the following:
(a) MAXIMUM AMOUNT. The principal amount of a loan
made under this Plan to any individual together with the outstanding principal
amount of any other loan made to such individual under any other qualified plan
under section 401(a) of the Code maintained by a Related Company shall not
exceed the lesser of
(1) 50 percent of the individual's vested
interest in his Accounts,
(2) $50,000 reduced by the highest
outstanding balance of any previous loans
from the Plan and any other plans of a
Related Company during the one-year
period ending immediately before the date
on which the current loan is made.
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Loans
(3) such amount that repayment of principal
plus interest does not exceed 25 percent
of the individual's gross pay.
(b) MINIMUM AMOUNT. The minimum loan amount shall be
$500 and all loan amounts shall be in increments of $100.
(c) PERIOD. No loan shall be made for a period less
than 12 months or longer than four and one-half years or such other periods as
may be established from time to time under the Corporation Committee's written
loan procedures.
(d) SECURITY. A loan shall be secured by the
Participant's Accounts up to the amount of the outstanding balance of the loan.
(e) NUMBER OF LOANS. Effective January 1, 1994, two
loans shall be available under the Plan to a Participant at any time, but no
third loan shall be made to an individual within 30 days following the
repayment in full of a prior loan, or such other time period as may be provided
from time to time under Plan procedures.
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Loans
(f) PARTICIPANT COVERS LOAN EXPENSES. Any loan made
under the Plan shall be subject to such other terms and conditions as the
Corporation Committee shall deem necessary or appropriate, including the
condition that the individual execute a satisfactory promissory note and
security agreement and the condition that he reimburse the Plan for any state
documentary stamps and other taxes, and any other reasonable expenses specified
by the Corporation Committee, which the Plan incurs to extend, make and service
the loan.
(g) HOW TO APPLY. A loan may be initiated by
following the appropriate telephonic or other procedures established by the
record-keeper, as the delegate of the Corporation Committee.
8.4 INTEREST RATE. The interest rate for a loan made under
this Plan shall be fixed for the term of each loan, and shall be set as
determined by the Corporation Committee on a quarterly basis at a rate which it
deems reasonable at the time for a fully secured loan and which is consistent
with applicable Department of Labor regulations.
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Loans
8.5 REPAYMENT AND DEFAULT.
(a) PAYMENTS. A loan made under the Plan shall
require that repayment be made in substantially level installments through
payroll withholding while the individual is an Employee and through such other
means (not less frequently than quarterly) as the Corporation Committee deems
appropriate for an individual who is not an Employee. Nevertheless, any
individual who terminates employment for any reason other than retirement,
discharge or lay-off must repay all of the outstanding principal balance of his
loan, plus interest due, within 90 days of the date of termination.
(b) PREPAYMENT. An individual may repay, at any
time, all of the outstanding principal balance of his loan, plus interest due,
without penalty.
(c) CREDITING PAYMENTS. Principal and interest
payments shall be credited to the Participant's Pre-Tax Account, After-Tax
Account and/or Rollover Account and shall be invested in the same manner as
Pre-Tax Contributions, After-Tax Contributions and Rollover Contributions.
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Loans
(d) DEFAULT. The events of default shall be set
forth in the promissory note and security agreement which evidence the loan.
Such events shall include, but not be limited to, the following:
(1) an individual terminates employment as an
Employee for any reason and does not make
payments when due, subject to a 90-day
grace period;
(2) the Trustee concludes that the individual
no longer is a good credit risk;
(3) to the extent permissible under federal
law, the individual's obligation to repay
the loan has been discharged through
bankruptcy or any other legal process of
action which did not actually result in
payment in full, and
(4) the individual does not make payments
when due, subject to the applicable 90
day grace period.
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Loans
(d) EFFECT OF DEFAULT. Upon the existence or
occurrence of an event of default, the loan may become due and payable in full
and, if such loan is not actually repaid in full, shall be cancelled on the
books and records of the Plan and the amount otherwise distributable to such
individual shall be reduced, as of the date his Accounts otherwise become
distributable, by the principal amount of the loan then due plus any accrued
but unpaid interest. Such principal and interest shall be determined without
regard to whether the loan had been discharged through bankruptcy or any other
legal process or action which did not actually result in payment in full;
however, interest shall continue to accrue on such loan only to the extent
permitted under applicable law. Cancellation of the amount distributable to an
individual under this subsection (d) shall not occur until a distributable
event occurs under the Plan. In the event a default occurs before a
distributable event occurs, the Corporation Committee shall take such other
steps to cure the default as it deems appropriate under the circumstances to
preserve Plan assets.
8.6 MECHANICS. A loan to an individual under this Plan shall
be made from his Pre-Tax Account, After-Tax Account and Rollover Account, and
the loan shall be an asset of the respective accounts. For investment
purposes, the principal amount of the loan shall be deducted from the
Participant's Investment
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Loans
Funds other than the Harris Stock Fund in proportion to their value in his
Accounts as of the Valuation Date immediately preceding the loan.
8.7 SPECIAL POWERS. The Corporation Committee shall have the
power to take such action as it deems necessary or appropriate to stop the
benefit payments to or on behalf of an individual who fails to repay a loan
(without regard to whether the obligation to repay the loan had been discharged
through bankruptcy or other legal process or action) until his Pre-Tax Account,
After-Tax Account and/or Rollover Account has been reduced by the principal due
(without regard to such discharge) on such loan or to distribute the note which
evidences such loan in full satisfaction of any interest in the Pre-Tax
Account, After-Tax Account, and/or Rollover Account which is attributable to
the unpaid balance of such loan.
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ARTICLE IX
IN-SERVICE WITHDRAWALS
9.1 AT-WILL WITHDRAWALS FROM SAVINGS ACCOUNT AND AFTER-TAX
ACCOUNT.
(a) AVAILABILITY. Subject to section 9.4, a
Participant may elect to withdraw at any time in a lump sum all or a portion of
the balance in his Savings Account and After-Tax Account for any purpose by
filing the appropriate election with the Local Committee.
(b) LIMITATIONS. A Participant may make a withdrawal
under this subsection (a) not more than once every three months. A
Participant's election to make After-Tax Contributions shall be suspended, and
no After-Tax Contributions or Matching After-Tax Contributions shall be
credited to the Participant's Account, for a period of six months after the
date of a Participant's withdrawal from the After-Tax Account. The
Participant's election shall automatically be reinstated at the expiration of
such six-month period, unless the Participant has filed a change of election
pursuant to section 3.7.
9.2 HARDSHIP WITHDRAWALS FROM PRE-TAX ACCOUNT.
(a) AVAILABILITY. Subject to section 9.4, a
Participant who has taken all loans and withdrawals under section 9.1, may
elect to withdraw in a
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In-Service Withdrawals
lump sum up to 100 percent of his Pre-Tax Contributions, plus earnings on that
amount that were credited to the Pre-Tax Account no later than June 30, 1989,
and/or his Rollover Account to satisfy an immediate and heavy financial need,
by filing an election with the Corporation Committee. Withdrawals under this
section 9.3 shall be authorized by the Corporation Committee in the event of
financial need meeting the safe harbor standards of Treasury regulation section
1.401(k)-1(d)(2), which is incorporated herein by reference. A withdrawal
shall be deemed to be made on account of an immediate and heavy financial need
under those regulations if the withdrawal is for:
(1) medical expenses incurred by the
Participant, his spouse or any of his
dependents;
(2) purchase (excluding mortgage payments) of
a principal residence for the
Participant;
(3) payment of tuition and related education
fees for the next 12 months of
post-secondary education for the
Participant, his spouse, children or
dependents;
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In-Service Withdrawals
(4) payment to prevent the eviction of the
Participant from his principal residence
or foreclosure on the mortgage of the
Participant's principal residence.
(5) any other event determined by the
Commissioner of Internal Revenue.
A withdrawal shall be deemed necessary to satisfy an immediate and
heavy financial need of the Participant if:
(i) the withdrawal is not in excess
of the amount required to meet
the financial need of the
Participant, including taxes and
additions to tax applicable to
such withdrawal, and
(ii) the Participant has obtained all
other distributions,
withdrawals, and all nontaxable
loans currently available under
this Plan and any other plans
maintained by a Related Company.
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In-Service Withdrawals
(b) LIMITATIONS. A Participant may take a withdrawal
under this section 9.2 no more than once in a six-month period.
9.3 EMERGENCY WITHDRAWALS. Subject to section 9.4, a
Participant who has taken all withdrawals available under Sections 9.1 and 9.2
above may elect to withdraw in a lump sum all or a portion of the balance in
his Basic Account and Supplemental Account if the withdrawal otherwise
satisfies the requirements of section 9.2(a). An election to withdraw under
this section 9.3 is subject to the approval of the "sector executive" which
shall be granted on a uniform and nondiscriminatory basis.
9.4 REDUCTION OF INVESTMENT FUND BALANCES. The Investment
Funds in which a Participant's Accounts are invested, other than the Harris
Stock Fund, shall be reduced proportionately to reflect the amount of the
Participant's withdrawals under this Article IX, except that a Participant may
not withdraw contributions invested in the Harris Stock Fund, and no more than
80 percent of the balance determined as of the Valuation Date immediately
preceding the withdrawal shall be available to be withdrawn from equity and
fixed income fund balances; provided that the amount remaining in the equity
and fixed income funds determined as of the Valuation Date coinciding with or
next following the withdrawal may be withdrawn as part of the withdrawal
request.
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ARTICLE X
TOP-HEAVY PROVISIONS
10.1 IN GENERAL. Notwithstanding any other provisions of the
Plan to the contrary, for any Plan Year in which this Plan is "top-heavy," as
defined herein, the provisions of this Article X shall apply. If the Plan is
top-heavy and then ceases to be top-heavy, except as otherwise provided in
section 10.3, the provisions of this Article X shall cease to apply.
10.2 MINIMUM ALLOCATION.
(a) For any Plan Year for which the Plan is
top-heavy, a minimum allocation shall be made for each "non-key employee" who
is employed by a Participating Company on the last day of the Plan Year in an
amount equal to the lesser of (a) three percent of Compensation or (b) the
largest percentage of Compensation allocated to any "key employee" during the
Plan Year. The minimum allocation is determined without regard to any Social
Security contribution. The minimum allocation shall not apply to any non-key
employee who receives a minimum contribution or minimum benefit under any other
plan of a Related Company.
(b) To satisfy subsection (a), the Profit-Sharing
Contributions for such Plan Year first shall be allocated to all Participants
employed on the last day of the Plan Year in an amount that meets the minimum
allocation amount,
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Top-Heavy Provisions
and any remaining Profit-Sharing Contribution then shall be allocated in
accordance with section 3.2.
10.3 MINIMUM VESTING. For any Plan Year for which the Plan is
top-heavy, the vested interest of a Participant who is employed by a
Participating Company during any part of the Plan Year shall be determined
under the following schedule:
PERIOD OF SERVICE VESTED PERCENTAGE
----------------- -----------------
Less than 2 years 0%
2 years but less than 3 years 20%
3 years but less than 4 years 40%
4 years but less than 5 years 60%
5 years but less than 6 years 80%
6 years or more 100%
If the Plan becomes top-heavy and ceases to be top-heavy, a
Participant who have a five-year Period of Service as determined under section
5.3 may elect to have his vested interest continue to be determined under this
section 10.3, notwithstanding that the Plan is no longer top-heavy.
10.4 DEFINITIONS. For purposes of this Article X, the
following terms shall have the following meanings:
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Top-Heavy Provisions
(a) "Determination date" means the last day of the
preceding Plan Year.
(b) "Determination period" means the Plan Year
containing the determination date and the four preceding Plan Years.
(c) "Key employee" means an Employee or former
employee (and their Beneficiaries) who, at any time during the determination
period, is
(1) an officer of the Participating Company
and has annual compensation greater than
50 percent of the dollar limitation in
effect under section 415(b)(1)(A) of the
Code for any such Plan Year,
(2) one of the ten Employees having annual
compensation in excess of the limitation
in effect under section 415(c)(1)(A) of
the Code and owning (or considered as
owning with the meaning of section 318 of
the Code) the largest interests in the
Participating Company,
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Top-Heavy Provisions
(3) a five-percent owner (within the meaning
of section 416(i)(1)(B) of the Code) of
the Participating Company, or
(4) a one-percent owner of the Participating
Company having annual compensation from
the Participating Company of more than
$150,000.
The determination of "key employee" shall be made under section
416(i)(1) of the Code, the terms of which are incorporated herein by reference.
(d) "Non-key employee" means any Employee who is not
a key employee.
(e) "Permissive aggregation group" means the
"required aggregation group" and any other plans of the Participating Company
which, when considered as a group with the required aggregation group, would
continue to satisfy the requirements of sections 401(a)(4) and 410 of the Code.
(f) "Required aggregation group" means (1) each
qualified plan of the Participating Company in which at least one key employee
participates or participated at any time during the determination period
(regardless of whether
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Top-Heavy Provisions
the plan has terminated), and (2) any other qualified plan of the Participating
Company which enables a plan described in (1) to meet the requirements of
sections 401(a) and 410 of the Code.
(g) "Top-heavy" means:
(1) the top-heavy ratio for the Plan exceeds
60 percent and the Plan is not part of
any required aggregation group or
permissive aggregation group;
(2) the Plan is part of a required
aggregation group but not a permissive
aggregation group and the top-heavy ratio
for the required aggregation group
exceeds 60 percent;
(3) the Plan is part of a required
aggregation group and a permissive
aggregation group and the top-heavy ratio
for the permissive aggregation group
exceeds 60 percent.
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Top-Heavy Provisions
(h) "Top-heavy ratio" means:
(1) if the Participating Company or Related
Company has not maintained any defined
benefit plan which during the five-year
period ending on the determination date
had accrued benefits, the top-heavy ratio
is a fraction, the numerator of which is
the sum of the account balances of all
key employees as of the determination
date (including any part of any account
balance distributed in the five-year
period ending on the determination date),
and the denominator of which is the sum
of all account balances (including any
part of any account balance distributed
in the five-year period ending on the
determination date).
(2) If a Related Company maintains or has
maintained a defined benefit plan which
during the five-year period ending on the
determination date had accrued benefits,
the top-heavy ratio is a fraction, the
numerator of which is the sum of account
balances
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Top-Heavy Provisions
under the defined contributions plans
for all key employees (including any part
of any account balance distributed in the
five-year period ending on the
determination date), and the present
value of accrued benefits under the
defined benefit plans for all key
employees as of the determination date,
and the denominator of which is the sum
of the account balances under the defined
contribution plans for all participants
(including any part of any account
balance distributed in the five-year
period ending on the determination date),
and the present value of accrued benefits
under the defined benefit plans for all
participants as of the determination
date.
(3) For purposes of (1) and (2) above, the
value of account balances and the present
value of accrued benefits shall be
determined as of the most recent
"valuation date" that falls within or
ends with the 12-month period ending on
the determination date, except as
provided in section 416 of the Code for
the first and second plan years of a
defined benefit plan. In the
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Top-Heavy Provisions
case of a defined benefit plan, the
"present value of accrued benefits" shall
be determined under the terms of the
applicable defined benefit plan. The
account balances and accrued benefits of
a Participant who is not a key employee
but who was a key employee in a prior
year, or who has not been credited with
at least an Hour of Service with any
Participating Company maintaining the
plan at any time during the five-year
period ending on the determination date
shall be disregarded. When aggregating
plans, the value of account balances and
accrued benefits shall be calculated with
reference to the determination dates that
fall within the same calendar year.
(4) The calculation of the top-heavy ratio
shall be determined in accordance with
section 416 of the Code, the provisions
of which are incorporated herein by
reference.
(i) "Valuation date" means the last day of the Plan
Year.
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ARTICLE XI
ADMINISTRATION
11.1 NAMED FIDUCIARIES. The Corporation shall be the "named
fiduciary" responsible for the control, management and administration of the
Plan.
11.2 CORPORATION COMMITTEE. The Corporation shall establish a
Corporation Committee to administer the Plan. The members of the Corporation
Committee shall be appointed, and removed at any time, by the appropriate
officers of the Corporation. A member of the Corporation Committee may resign
at any time by giving written notice to the Corporation at least 15 days prior
to the effective date of the resignation.
11.3 POWERS AND DUTIES OF COMMITTEE. The Corporation Committee
shall have the powers and duties conferred on it by the terms of the Plan. The
Corporation Committee may establish such rules and regulations as it deems
necessary to enable it to administer the Plan. The Corporation Committee shall
have the discretionary authority to determine eligibility for benefits and
construe the terms of the Plan.
11.4 ACTIONS OF COMMITTEE. No formal meeting and no minutes
shall be required with respect to actions taken by the Corporation Committee.
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Administration
11.5 FINALITY OF DECISIONS. All decisions and directions made
by the Corporation Committee, in the discretionary exercise of its powers and
duties, shall be final and binding on all parties concerned.
11.6 IMMUNITIES OF COMMITTEE. Except as otherwise provided by
law, no member of the Corporation Committee shall be liable to a Participating
Company or to any Participant or Beneficiary by reason of the exercise in good
faith of any power or discretion vested in him by the terms of the Plan.
11.7 ADVISERS AND AGENTS. The Corporation, or the Corporation
Committee, with the consent of the Corporation, may employ one or more persons
to render advice with respect to any responsibility that the Corporation, or
the Corporation Committee, respectively, has under the Plan. The Corporation,
or the Corporation Committee, may appoint unrelated parties to carry out
trustee, investment management and record-keeping responsibilities with respect
to the Plan. The Corporation shall indemnify any person, including an employee
of the Corporation, who is acting on behalf of the Corporation or the
Corporation Committee in this capacity with respect to liability that may arise
by reason of his action or failure to act concerning the Plan, excepting any
willful or gross misconduct or criminal acts, to the extent required in the
respective contracts governing such arrangements.
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11.8 COMMITTEE MEMBER WHO IS PARTICIPANT. A member of the
Corporation Committee who also is a Participant shall have no right to vote
with respect to any action that pertains solely to him as a Participant. In
the event a majority of the remaining members are unable to agree as to the
action to be taken with respect to the Participant, the chief executive officer
of the Corporation shall appoint an impartial person to arbitrate the matter
between the remaining members and to reach a decision.
11.9 INFORMATION PROVIDED BY PARTICIPATING COMPANIES. Each
Participating Company and Employment Unit shall provide the Corporation, the
Corporation Committee and the Trustee with complete and timely information
regarding employment data for each Employee and Participant needed by the
Corporation, Corporation Committee or Trustee to administer the Plan,
including, but not limited to, information concerning Compensation, date of
employment, date of termination of employment, reason for termination and any
other information required by the Corporation, Corporation Committee, or
Trustee.
11.10 EXPENSES. All reasonable and proper expenses of the Plan
and the Trust, including, but not limited to, investment advisory fees,
record-keeping fees, and Trustee's fees shall be paid from Participants'
Accounts in a uniform and nondiscriminatory manner, which may be ratably,
unless otherwise paid by the
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Corporation. The Corporation may seek reimbursement of any expense which it
pays that is properly payable by the Trust Fund.
11.11 TRUST FUND AVAILABLE TO PAY ALL PLAN BENEFITS. The Plan
is intended to be a single plan under Treasury regulation section
1.414(l)-1(b)(1). The maintenance of Accounts as required by the terms of the
Plan shall be for record-keeping purposes only. All of the Trust Fund shall be
available to pay benefits to all Participants and Beneficiaries.
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ARTICLE XII
AMENDMENT AND TERMINATION AND CHANGE OF CONTROL
12.1 AMENDMENT. The Corporation reserves the right to amend
the Plan by action of its Board of Directors or the appropriate committee
thereof at any time and from time to time, subject to the following
limitations:
(a) no amendment shall be made which vests in any
Participating Company any interest in any assets of the Plan other than as
specifically provided in section 12.2;
(b) no amendment shall be made which would have the
effect of decreasing a Participant's "accrued benefit" as proscribed in section
411(d)(6) of the Code; and
(c) no amendment shall have the effect of reducing a
Participant's vested interest in his Accounts. If the Plan is amended to
change the vesting schedule, each Participant with at least a three-year Period
of Service shall have the right to elect to have his vested interest computed
without regard to the amendment. Each Participant shall be permitted to make
this election during the period ending 60 days after the latest of the date (1)
the amendment is adopted; (2) the amendment is effective, and (3) the
Participant is issued a written notice of the amendment by the Corporation or
its delegate.
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Amendments will normally be initiated by the Corporation Committee,
approved by upper management of the Corporation, then adopted by resolution of
the Retirement Plan Investment Committee of the Board of Directors.
12.2 TERMINATION OF PLAN. This Plan is intended to be
permanent, and it is the expectation of the Corporation that it will continue
indefinitely. However, the Corporation reserves the right to terminate the
Plan by resolution of its Board of Directors or the appropriate committee
thereof. In the case of a complete termination of the Plan, previously
unallocated forfeitures shall be allocated as otherwise provided in the Plan.
To the extent previously unallocated forfeitures cannot be allocated because
all Participants have reached the limitations of section 415 of the Code, the
unallocated amount shall revert back to the appropriate Participating Company,
as provided in section 3.10.
12.3 DISCONTINUANCE OF CONTRIBUTIONS. The Corporation reserves
the right to discontinue contributions to the Plan by amendment or by
resolution of the Board of Directors or the appropriate committee thereof.
12.4 VESTING ON TERMINATION OR DISCONTINUANCE OF CONTRIBUTIONS.
As of the date of the partial or complete termination of the Plan or upon the
complete discontinuance of contributions to the Plan, each affected
Participant shall
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become fully vested in his Accounts and no further allocations of contributions
or forfeitures shall be made after such date on behalf of an affected
Participant.
12.5 DISTRIBUTION ON TERMINATION. Upon the complete
termination of the Plan, the Trustee shall distribute to each affected
Participant the full amount standing to the credit of his Accounts; provided
that if such amount exceeds (or at the time of any prior distribution exceeded)
$3,500 and the Participant is not yet age 65, such lump sum shall not be paid
without his consent. If the Participant does not consent, an annuity contract
shall be purchased for and distributed to the Participant.
12.6 CHANGE OF CONTROL.
(a) DEFINITION. Notwithstanding any other provisions
of the Plan to the contrary, if
(1) a third person, including a "group" as
defined in Section 12(d)(3) of the
Securities Exchange Act of 1934 (or any
rules or regulations thereunder),
acquires shares of the Corporation having
20 percent or more of the total number of
votes that may be cast for the election
of directors of the Corporation; or
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(2) as a result of any cash tender or
exchange offer, merger or other business
combination of the foregoing transactions
(the "Transaction"), the persons who were
directors of the Corporation before the
Transaction cease to constitute a
majority of the Board of Directors of the
Corporation or any successor to the
Corporation,
then during the period commencing on the date of acquisition of said voting
power or control of the Board of Directors of the Corporation or any successor
thereto and ending at the close of business on the next following June 30 (the
"Restriction Period"), the provisions of this section 12.6 shall apply.
(b) EFFECT. During the Restriction Period, the Plan
may not be terminated or amended to the extent the amendment would:
(1) reduce coverage under the Plan;
(2) reduce the amount of Profit-Sharing
Contributions required to be made for the
Plan Year ending on the last day of the
Restriction Period;
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(3) reduce the amount of After-Tax
Contributions eligible for a matching
contribution that a Participant is
permitted to make or the amount of the
Matching After-Tax Contributions required
under sections 3.5 and 3.6; or
(4) reduce the amount of Pre-Tax
Contributions that a Participant is
permitted to make or the amount of
Matching Pre-Tax Contributions required
under sections 3.3 and 3.4.
(c) For the purpose of computing the amount of the
Profit-Sharing Contributions for the twelve-month period ending on the last day
of a Restriction Period, the adjusted consolidated net income of the
Corporation and its Consolidated Subsidiaries before net income taxes for the
Fiscal Year ending on such date is deemed to be the forecast of the
consolidated net income of the Corporation and its Consolidated Subsidiaries
for such Fiscal Year as set forth in the annual operating plan of the
Corporation for such Fiscal Year.
(d) During the Restriction Period, any person who was
an Employee on the day preceding the first day of the Restriction Period shall
be
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deemed to be an Employee so long as he is employed by a member of a "controlled
group of corporations" which includes, or by a trade or business that is under
common control with (as those terms are defined in sections 414(b) and (c) of
the Code) the Corporation, any corporation which is the survivor of any merger
or consolidation to which the Corporation was a party, or any corporation into
which the Corporation has been liquidated.
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ARTICLE XIII
MISCELLANEOUS PROVISIONS
13.1 RESTRICTIONS ON ALIENATION; QUALIFIED DOMESTIC RELATIONS
ORDERS. Except as otherwise may be required for Federal, state or local income
tax withholding purposes, no benefit or interest under this Plan shall be
subject to assignment or alienation, either voluntarily or involuntarily. The
preceding sentence shall apply to the creation, assignment or recognition of a
right to any benefit payable with respect to a Participant pursuant to a
domestic relations order, unless such order is determined to be a Qualified
Domestic Relations Order, as defined in section 414(p) of the Code. In
accordance with uniform and nondiscriminatory procedures established by the
Corporation Committee from time to time, the Corporation Committee upon the
receipt of a domestic relations order which seeks to require the distribution
of a Participant's Account in whole or in part to an "alternative payee" (as
that term is defined in Code section 414(p)(8)) shall:
(1) promptly notify the Participant and such
"alternate payee" of the receipt of such order and of the procedure which the
Corporation Committee will follow to determine whether such order constitutes a
"Qualified Domestic Relations Order" within the meaning of Code section 414(p),
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Miscellaneous Provisions
(2) determine whether such order constitutes a
"Qualified Domestic Relations Order" and notify the Participant and the
"alternate payee" of the results of such determination and,
(3) if the Corporation Committee determines that such
order does constitute a "Qualified Domestic Relations Order," distribute to
such "alternate payee" under the terms of such order the amount called for
under the order in a single sum within 60 days of the date such order is
determined to constitute a Qualified Domestic Relations Order, without regard
to whether a distribution would be permissible to the Participant at such time
under this Plan.
The determination and the distribution made by, or at the direction
of, the Corporation Committee under this section 13.1 shall be final and
binding on the Participant and on all other persons interested in such order.
An "alternate payee" under this section 13.1 shall not be an eligible person
for purposes of obtaining a loan pending the distribution of such alternate
payee's entire interest under this Plan.
13.2 EXCLUSIVE BENEFIT REQUIREMENT. Except as provided in
sections 12.2 and 13.3, no assets of the Plan shall revert to a Participating
Company or be
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Miscellaneous Provisions
used for or diverted to purposes other than providing benefits to Participants
and their Beneficiaries and defraying reasonable costs of administering the
Plan.
13.3 RETURN OF CONTRIBUTIONS.
(a) Mistakes of fact. Any contribution made by a
Participating Company due to a mistake of fact shall be returned to the
Participating Company within one year of the date the contribution was made.
(b) Nondeductible Contributions. In the event the
deduction of a contribution made by a Participating Company is disallowed under
section 404 of the Code, such contribution (to the extent disallowed) shall be
returned to the Participating Company within one year of the disallowance of
the deduction.
13.4 NO CONTRACT OF EMPLOYMENT. Neither the establishment and
maintenance of the Plan nor the participation in the Plan by any Employee shall
be construed as a contract between the Employee and any Participating Company
so as to give any Employee the right to be retained by any Participating
Company, or to interfere with the rights of any Participating Company to
discharge the Employee at any time.
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Miscellaneous Provisions
13.5 PAYMENT OF BENEFITS ON INCAPACITY. In the event the
Corporation Committee determines that any person to whom a distribution is to
be made is unable to care for his affairs by reason of illness or other
disability, any amount distributable to such person (unless prior claim thereto
shall have been made by a duly qualified guardian or other legal
representative) may, in the discretion of the Corporation Committee, be paid to
such other person deemed by the Corporation Committee to be responsible for
such person. Any such payment made under this section 13.5 shall constitute a
complete discharge of any liability under this Plan.
13.6 MERGER. In the event of a merger or consolidation with,
or transfer of assets or liabilities to any other plan, each Participant shall
receive a benefit immediately after such merger, consolidation or transfer (if
the Plan then terminated) which is at least equal to the benefit the
Participant was entitled to receive immediately before such merger,
consolidation or transfer (if the Plan had then terminated).
13.7 CONSTRUCTION. The headings and subheadings in this Plan
have been inserted for convenience of reference only and are to be ignored in
the construction of its provisions. Wherever appropriate, the masculine shall
be read as the feminine, the plural as the singular, and the singular as the
plural. References in this Plan to a section shall be to a section in this
Plan unless
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Miscellaneous Provisions
otherwise indicated. References in this Plan to a section of the Code, ERISA
or any other federal law shall also refer to the regulations issued under such
section.
13.8 GOVERNING LAW. This Plan shall be construed, to the
extent to which state law is applicable, in accordance with the laws of the
State of Florida. Venue for any action arising under this Plan shall be in
Brevard County, Florida.
13.9 MISTAKEN PAYMENTS. If a mistake is made in favor of a
Participant or Beneficiary in the payment of benefits under this Plan, the
Corporation or the Trustee (acting at the Corporation direction and on behalf
of the Plan) shall take such action against the Participant or Beneficiary to
remedy such mistake and to make the Plan whole as the Corporation deems proper
and appropriate under the circumstances, and any mistake in favor of the Plan
shall promptly be corrected by, or at the direction of, the Corporation.
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ARTICLE XIV
SPECIAL PROVISIONS FOR
EMPLOYEES OF
HARRIS TECHNICAL SERVICES DIVISION OF
HARRIS TECHNICAL SERVICES CORPORATION
-------------------------------------
Notwithstanding the provisions of any other Article of this Plan to
the contrary, the following special provisions apply to Participants who are
employees of the Harris Technical Services Division of Harris Technical
Services Corporation.
14.1 PARTICIPATION. Notwithstanding section 2.1, an Employee
shall become a Participant on the first day on which the Employee performs an
Hour of Service.
14.2 PROFIT-SHARING CONTRIBUTIONS. (a) Notwithstanding section
3.1, a Profit-Sharing Contribution shall be made for each Plan Year on behalf
of Employees of the Employment Unit consisting of the Harris Technical Services
Division in an amount equal to 7 percent of before-tax M-2 profits. Ten (10)
percent of the estimated Profit-Sharing Contribution for each Plan Year shall
be made no later than the last day of October, January, and April of each year.
The remaining Profit-Sharing Contribution for each Plan Year shall be made no
later than the last day of September. (b) Notwithstanding any provision to the
contrary in Section 3.2, Profit-Sharing Contributions shall be allocated pro
rata to each Participant on the basis of the number of full months of his or
her Period of
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Service completed during the Plan Year, provided that fractional months shall
be aggregated. The limitation in eligibility in section 3.2(c) shall not
apply.
14.3 PRE-TAX CONTRIBUTIONS. Section 3.3(a) shall apply,
provided, however, that a Participant may elect to reduce his Compensation by
an amount equal to any whole percentage not to exceed 15 percent and have the
amount of such reduction contributed to the Plan as a Pre-Tax Contribution.
14.4 NO MATCHING PRE-TAX CONTRIBUTIONS. Notwithstanding any
other provision of the Plan to the contrary, no Matching Pre-Tax Contributions
will be made on behalf of Participants.
14.5 NO INVESTMENT IN THE HARRIS STOCK FUND. Notwithstanding
any provision of the Plan to the contrary, Participants may not direct
investments into the Harris Stock Fund.
14.6 VESTING. The Vesting Schedule in section 5.3(a) shall be
replaced by the following vesting schedule:
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PERIOD OF SERVICE VESTED PERCENTAGE
----------------- -----------------
Less than 1 year 0%
1 year but less than 2 years 20%
2 years but less than 3 years 40%
3 years but less than 4 years 60%
4 years but less than 5 years 80%
5 years or more 100%
HARRIS CORPORATION
Date: /S/ JUNE 24, 1994 By: /S/ DAVID S. WASSERMAN
---------------------------- --------------------------
Attest: /S/ KAREN G. FINK Title: /s/ Vice President and
--------------------------- Treasurer
--------------------------
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APPENDIX A
INVESTMENT FUNDS. The Investment Funds available under the plan as of October
1, 1993 are as follows:
(a) BALANCED FUND. Assets held in this fund will be invested in a
variety of stocks, bonds, mortgages, fixed-income securities such as
U.S. Treasury bills, certificates of deposit, commercial paper and
real estate.
(b) SHORT-TERM BOND FUND. Assets in this fund will be invested in
shorter-term fixed-income securities such as government bonds, U.S.
Treasury bills and notes, certificates of deposit, federal agency
obligations, mortgage securities and corporate bonds.
(c) MONEY MARKET FUND. Assets in this fund will be invested in a
diversified portfolio of high-quality, short-term fixed instruments
such as U.S. Treasury bills, federal agency obligations, commercial
paper, certificates of deposit and banker's acceptances.
(d) STABLE VALUE FUND. Assets held in this fund will be invested in a
diversified portfolio of investment contracts and short-term,
high-quality fixed income instruments that guarantee principal and a
specified rate of return for a specified period.
Harris Retirement Plan
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(e) EQUITY INCOME FUND. Assets held in this fund will be invested
primarily in dividend-paying common stocks of established companies
but may also be invested in convertible bonds and/or convertible
preferred stock.
(f) INDEXED EQUITY FUND. Assets held in this fund will be invested in a
stock portfolio that mirrors the Standard & Poor's 500 Stock Index.
(g) GROWTH FUND. Assets in this fund will be invested for the longer
term, primarily in common stocks of companies which are currently
experiencing an above-average rate of earnings growth. The fund's
stock selection criteria include a requirement that each company
have a five-year average performance record of sales, earnings,
dividend growth, pre-tax margins, return on equity.
(h) HARRIS STOCK FUND. Assets in this fund will be invested in common
stock of the Corporation.
The Investment Funds may be changed at any time and from time to time.
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APPENDIX B
SPECIAL PROVISIONS FOR TRANSFERRED PARTICIPANTS
-----------------------------------------------
The provisions of this Appendix B are effective as of January 1,
1990.
(a) For purposes of this Appendix B, the following terms shall have the
following meanings:
(1) "TRANSFERRED PARTICIPANTS" means those
former Employees whose employment with a
Participating Company ceased due to a
sale of the stock or assets of a Sold
Operation.
(2) "SOLD OPERATION" means (i) the Data
Communications Division and (ii) the
Chatsworth Operation.
(3) "CLOSING DATE" means the date as of which
the sale of the relevant Sold Operation
was effective.
(b) Each Transferred Participant shall be fully vested in his Accounts
as of the relevant Closing Date.
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