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Exhibit 4(d)
NORTHSHORE MINING COMPANY AND SILVER BAY POWER COMPANY
RETIREMENT SAVINGS PLAN
Sequential Page 11
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NORTHSHORE MINING COMPANY AND SILVER BAY POWER COMPANY
RETIREMENT SAVINGS PLAN
TABLE OF CONTENTS
ARTICLE I
NAME AND PURPOSE OF PLAN . . . . . . . 1
ARTICLE II
DEFINITIONS . . . . . . . . . . 1
2.1 ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.2 AFFILIATED COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.3 AFTER-TAX CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.4 BENEFICIARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.5 BOARD OF DIRECTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.6 CLIFFS STOCK . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.7 CLIFFS STOCK FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.8 CODE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
2.9 COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.10 COMPANY CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.11 COMPANY MATCHING CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.12 COMPENSATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.13 EFFECTIVE DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.14 EMPLOYEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.15 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.16 LEASED EMPLOYEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.17 NORMAL RETIREMENT AGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.18 PARTICIPANT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.19 PARTICIPANT CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.20 PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.21 PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.22 PLAN YEAR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.23 PRE-TAX CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.24 QUALIFIED NON-ELECTIVE CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.25 RELATED CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.26 ROLLOVER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.27 TERMINATION OF EMPLOYMENT or TERMINATES EMPLOYMENT . . . . . . . . . . . . . . . . . . . . 4
2.28 TOTAL DISABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.29 TRANSFER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.30 TRUST AGREEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.31 TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.32 TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.33 VALUATION DATE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(i)
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ARTICLE III
PARTICIPATION . . . . . . . . . . 4
3.1 WHO MAY BECOME A PARTICIPANT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.2 DETERMINATION OF PARTICIPANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.3 PARTICIPATION UPON REEMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.4 CHANGES IN EMPLOYMENT STATUS; TRANSFERS OF EMPLOYMENT . . . . . . . . . . . . . . . . . . 5
ARTICLE IV
CONTRIBUTIONS . . . . . . . . . . 5
4.1 PARTICIPANT CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4.2 COMPANY MATCHING CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.3 CONTRIBUTION LIMITATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.4 QUALIFIED NON-ELECTIVE CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.5 LIMITATION ON ANNUAL ADDITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.6 LIMITATION ON COMBINED BENEFITS AND CONTRIBUTIONS UNDER ALL
DEFINED BENEFIT PLANS AND DEFINED CONTRIBUTION PLANS OF THE
COMPANY AND ANY RELATED CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.7 EXCLUSIVE BENEFIT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.8 COMPANY'S OBLIGATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
4.9 ROLLOVER CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
ARTICLE V
PARTICIPANTS' ACCOUNTS . . . . . . . 15
5.1 PARTICIPANT'S SUBACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.2 ALLOCATION OF CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.3 VESTING OF PARTICIPANT'S ACCOUNT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.4 TRANSFER OF ACCOUNTS UPON TRANSFER OF EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . 17
ARTICLE VI
INVESTMENT OF ACCOUNTS . . . . . . . 17
6.1 INVESTMENT CATEGORIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.2 CONTINUING INVESTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.3 CHANGE OF INVESTMENT HOLDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.4 INTERIM INVESTMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
6.5 VALUATION OF PARTICIPANT'S ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(ii)
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ARTICLE VII
DISTRIBUTION FROM TRUST FUND . . . . . . 19
7.1 WHEN ACCOUNT BECOMES DISTRIBUTABLE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
7.2 TIME AND FORM OF PAYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
7.3 DISPOSITION OF ACCOUNT ON TERMINATION OF EMPLOYMENT . . . . . . . . . . . . . . . . . . . 20
7.4 DIRECT ROLLOVER OF DISTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
7.5 SPENDTHRIFT TRUST PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.6 DISTRIBUTION IN THE EVENT OF DEATH . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.7 BENEFICIARIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
7.8 WITHDRAWALS DURING SERVICE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
7.9 PARTICIPANT LOANS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
ARTICLE VIII
FIDUCIARY OBLIGATIONS . . . . . . . . 28
8.1 GENERAL FIDUCIARY DUTIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
8.2 ALLOCATION OF FIDUCIARY RESPONSIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . 28
8.3 COMPENSATION AND EXPENSES OF FIDUCIARIES . . . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE IX
PLAN ADMINISTRATOR . . . . . . . . 28
9.1 APPOINTMENT OF PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
9.2 INFORMATION TO BE MADE AVAILABLE TO PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . 29
9.3 DUTIES AND POWERS OF PLAN ADMINISTRATOR . . . . . . . . . . . . . . . . . . . . . . . . . 29
9.4 NOTICES FROM PARTICIPANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
9.5 CLAIMS PROCEDURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE X
TRUST FUND . . . . . . . . . . 31
10.1 TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
10.2 INVESTMENT OF TRUST FUND . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE XI
CONTINUANCE, TERMINATION AND
AMENDMENT OF PLAN . . . . . . . . . 33
11.1 TERMINATION OF PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.2 MERGER, CONSOLIDATION OR TRANSFER OF ASSETS OR
LIABILITIES OF THE PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
11.3 AMENDMENTS TO PLAN . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
11.4 PARTICIPATING COMPANIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(iii)
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ARTICLE XII
MISCELLANEOUS . . . . . . . . . . 35
12.1 BENEFITS TO BE PROVIDED SOLELY FROM THE TRUST FUND . . . . . . . . . . . . . . . . . . . . 35
12.2 TEXT TO CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
12.3 SEVERABILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
12.4 JURISDICTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
12.5 PLAN FOR EXCLUSIVE BENEFIT OF PARTICIPANTS; REVERSION
PROHIBITED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
12.6 GENDER AND NUMBER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
ARTICLE XIII
TOP HEAVY PROVISIONS . . . . . . . . 36
13.1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
13.2 COMPENSATION AND LIMITATION THEREON . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
13.3 VESTING REQUIREMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
13.4 MINIMUM ALLOCATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE XIV
SPECIAL PROVISIONS REGARDING ACQUISITION EMPLOYEES . 39
14.1 GENERAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
14.2 EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
14.3 TRANSFER OF ASSETS AND LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
14.4 CONTINUATION OF PORTION OF CYPRUS SAVINGS PLAN . . . . . . . . . . . . . . . . . . . . . . 40
EXHIBIT "A"
(iv)
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NORTHSHORE MINING COMPANY AND SILVER BAY POWER COMPANY
RETIREMENT SAVINGS PLAN
ARTICLE I
NAME AND PURPOSE OF PLAN
Northshore Mining Company, by execution of this agreement, establishes
a plan to be known as the Northshore Mining Company and Silver Bay Power
Company Retirement Savings Plan (the "Plan"), effective as of the day following
the "Closing Date" of the transactions contemplated by the Stock Purchase
Agreement by and between Cleveland-Cliffs Inc and Cliffs Minnesota Minerals
Company and Cyprus Amax Minerals Company, as amended (the "Stock Purchase
Agreement"), as "Closing Date" is defined in such Stock Purchase Agreement; and
Silver Bay Power Company, by execution of this Agreement, adopts the Plan
effective as of the Closing Date. The Plan is created for the exclusive
benefit of Participants and their Beneficiaries. The Plan is intended to
qualify under Sections 401(a) and 401(k) of the Code as a qualified cash or
deferred arrangement, and the Trust created under the Plan is intended to be
exempt under Section 501(a) of the Code.
ARTICLE II
DEFINITIONS
When used in the Plan, the following words will have the following
meanings, unless the context clearly indicates otherwise:
2.1 "Account", unless otherwise indicated, means a Participant's entire
interest in the Trust Fund.
2.2 "Affiliated Company" means any corporation that is a member of the
"controlled group of corporations" of which the Company is also a member (as
such term is defined in Section 1563(a) of the Code without regard to Section
1563(a)(4) of the Code).
2.3 "After-Tax Contributions" mean the amounts contributed by the
Participant pursuant to Section 4.1[b].
2.4 "Beneficiary" means the person who, under this Plan, becomes entitled
to receive a Participant's Account upon his death, including when applicable
the surviving spouse.
2.5 "Board of Directors", unless otherwise specified, means the Board of
of Northshore Mining Company.
2.6 "Cliffs Stock" means the common stock, par value $1.00, of
Cleveland-Cliffs Inc.
2.7 "Cliffs Stock Fund" means the fund invested solely in Cliffs Stock.
2.8 "Code" means the Internal Revenue Code of 1986, as amended, or any
successor statute of similar purpose.
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2.9 "Company" means Northshore Mining Company, and any Affiliated Company
that adopts this Plan with the approval of the Board of Directors (which
Companies shall be listed on Exhibit A to the Plan), and any successor in
interest resulting from merger, consolidation or transfer of substantially all
of the Company's assets that may expressly agree in writing to continue this
Plan.
2.10 "Company Contributions" mean the amounts contributed under the Plan by
the Company as provided in Article IV, including Company Matching
Contributions; and shall also include the applicable portion of a Participant's
Transfer Contributions.
2.11 "Company Matching Contributions" mean the amounts contributed by the
Company pursuant to Section 4.2 and allocated pursuant to Section 5.2[a].
2.12 "Compensation" means the basic salary paid to a Participant for
services rendered to the Company during the Plan Year and includes basic
earnings paid to a Participant during the Plan Year that was deferred from a
previous year and any salary reduction contributions made under this Plan but
does not include any basic salary for the Plan Year that is deferred to a
subsequent year, overtime, bonuses, commissions, moving allowances or any other
extraordinary compensation. In addition to other applicable limitations which
may be set forth in the Plan and notwithstanding any other contrary provision
of the Plan, Compensation taken into account under the Plan for a Plan Year
shall not exceed $150,000, as adjusted for changes in the cost-of-living as
provided in Sections 401(a)(17)(B) and 415(d) of the Code. In determining the
Compensation of a Participant for purposes of this limitation, the rules of
Section 414(q)(6) of the Code shall apply, except that in applying such rules
the term "family" shall only include the spouse of the Participant and any
lineal descendants of the Participant who have not attained age 19 before the
close of the Plan Year.
2.13 "Effective Date" means the day following the "Closing Date" of the
transactions contemplated by the Stock Purchase Agreement by and between
Cleveland-Cliffs Inc and Cliffs Minnesota Minerals Company and Cyprus Amax
Minerals Company, as amended (the "Stock Purchase Agreement"), as "Closing
Date" is defined in such Stock Purchase Agreement.
2.14 "Employee" means any person now or hereafter in the employ of the
Company at Company locations in the United States, and United States citizens
at other locations while being paid on the United States payroll, including
officers of the Company, but excluding (i) employees included in a unit of
employees covered by a collective bargaining agreement between employee
representatives and the Company if there is evidence that retirement benefits
were the subject of good faith bargaining between such employee representatives
and the Company, (ii) directors who are not employed by the Company in any
other capacity, (iii) independent contractors, (iv) Leased Employees, and (v)
any employee who is a self-employed individual or owner-employee within the
meaning of Section 401(c) of the Code with respect to his employment with the
Company.
2.15 "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
2.16 "Leased Employee" means any person (other than an employee of the
recipient) who pursuant to an agreement between the recipient and any other
person (a "leasing organization") has performed services for the recipient (or
for the recipient and related persons determined in accordance with Section
414(n)(6)
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of the Code) on a substantially full-time basis for a period of at least one
year, and where such services are of a type historically performed by employees
in the business field of the recipient employer. Contributions or benefits
provided a Leased Employee by the leasing organization which are attributable
to services performed for the recipient employer shall be treated as provided
by the recipient employer.
A Leased Employee shall not be considered an employee of the recipient if: (i)
such Leased Employee is covered by a money purchase pension plan providing:
(A) a non-integrated employer contribution rate of at least ten percent of
"compensation" (as defined in Section 415(c)(3) of the Code) but including
amounts contributed by the employer pursuant to a salary reduction agreement
which are excludable from the employee's gross income under Section 125,
402(a)(8), 402(h) or 403(b) of the Code, (B) immediate participation, and (C)
full and immediate vesting; and (ii) Leased Employees do not constitute more
than 20 percent of the recipient's "Non-Highly Compensated Employee" (as
defined in Section 4.3[c][4]) work force.
2.17 "Normal Retirement Age" means age 65. Notwithstanding any other
provision of the Plan to the contrary, an Employee shall be 100 percent vested
in his Account upon attainment of age 65.
2.18 "Participant" means any Employee who has become a Participant under
this Plan. Participation will cease upon distribution of a Participant's
entire vested Account after Termination of Employment.
2.19 "Participant Contributions" mean the amounts contributed under the
Plan by Participants as provided in Article IV, including Pre-Tax
Contributions, After-Tax Contributions and Rollover Contributions; and shall
also include the applicable portion of a Participant's Transfer Contributions.
2.20 "Plan" means the plan maintained under this document and all
subsequent amendments to it.
2.21 "Plan Administrator" means the person or persons appointed by the
Board of Directors whose duties are specified in this Plan.
2.22 "Plan Year" means the calendar year; provided, however, that the first
Plan Year shall be a "Short Plan Year" commencing on the Effective Date and
ending December 31, 1994.
2.23 "Pre-Tax Contributions" mean the amounts contributed by the
Participant pursuant to Section 4.1[b].
2.24 "Qualified Non-Elective Contributions" mean the amounts contributed by
the Company pursuant to Section 4.4.
2.25 "Related Corporation" means any corporation which is a member of a
controlled group of corporations of which the Company is also a member, as
determined under Section 1563(a) of the Code, without regard to Sections
1563(a)(4) and 1563(e)(3)(C) of the Code. Furthermore, the term shall include
any trade or business (whether or not incorporated) which is a member of a
group under common control of which the Company is also a member, as determined
under Section 414(c) of the Code. The term shall also include each
organization which is a member of an affiliated service group of which the
Company is also a member,
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as determined under Section 414(m) of the Code. Finally, the term shall
include any entity, other than the Company, which is required to be aggregated
with the Company under Section 414(o) of the Code.
2.26 "Rollover Contributions" mean the amounts contributed by the
Participant pursuant to Section 4.9.
2.27 "Termination of Employment" or "Terminates Employment" means a
termination of the employer-employee relationship between an Employee and the
Company for any reason. Transfer to employment (i) with a Related Corporation
that does not maintain this Plan or (ii) to an ineligible class of employees,
will not be considered a Termination of Employment, and Plan participation will
be governed by the provisions of Section 3.4.
2.28 "Total Disability" means a disability that renders a Participant
unable to perform satisfactorily the usual duties of his employment with the
Company, as determined by a physician selected by the Plan Administrator, and
which results in his Termination of Employment with the Company.
2.29 "Transfer Contributions" mean the amounts transferred to the Plan from
the Cyprus Amax Minerals Company Savings Plan & Trust, as described in Article
XIV.
2.30 "Trust Agreement" means the agreement entered into between Northshore
Mining Company and the Trustee, which agreement is incorporated herein by
reference.
2.31 "Trustee" means the person or persons appointed by the Board of
Directors as the trustee of the Trust Fund and any duly appointed and qualified
successor trustee.
2.32 "Trust Fund" means the assets of the Plan from which benefits will be
paid and includes all income of any nature earned by such trust fund and all
changes in fair market value.
2.33 "Valuation Date" means the date investments are valued and shall occur
on each business day on which the Plan's recordkeeper and the New York Stock
Exchange are open for business.
ARTICLE III
PARTICIPATION
3.1 WHO MAY BECOME A PARTICIPANT: Any Employee who is an Employee on the
Effective Date will become a Participant on such Effective Date; provided,
however, such Employee has completed the appropriate enrollment form and timely
filed such form with the Plan Administrator. Any other Employee will become a
Participant as of the first pay period of the calendar month next following the
date the Employee commences or recommences employment with the Company;
provided, however, such Employee has completed the appropriate enrollment form
and timely filed such form with the Plan Administrator. Any Employee who does
not become a Participant when first eligible to do so may become a Participant
as of the first pay period of the calendar month next following the Employee's
completion of the appropriate enrollment form and timely filing of such form
with the Plan
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Administrator. Any Employee who is a Participant will continue to be a
Participant upon restatement or amendment of the Plan, unless the restatement
or amendment specifically excludes the Employee from participation.
3.2 DETERMINATION OF PARTICIPANTS: The Plan Administrator will determine
when Employees become eligible to participate in the Plan and will provide such
Employees with the necessary enrollment forms to commence participation in the
Plan. An Employee may enroll during the month he first becomes eligible to
participate in the Plan or any month thereafter by filing the completed
enrollment forms with the Plan Administrator within the required time before
the month his election to participate in the Plan begins. Participation will
begin the first pay period in the month following the Employee's completion of
the enrollment form and timely filing of it with the Plan Administrator.
3.3 PARTICIPATION UPON REEMPLOYMENT: An Employee may become a Participant
upon his reemployment as an Employee or transfer to an eligible class of
Employees, as described in Section 2.14, on the first pay period in the month
following the Employee's completion of the appropriate enrollment form and
timely filing of it with the Plan Administrator.
3.4 CHANGES IN EMPLOYMENT STATUS; TRANSFERS OF EMPLOYMENT: If a
Participant ceases to be an Employee but continues in the employment of (i) the
Company in some other capacity or (ii) a Related Corporation, he shall
nevertheless continue as a Participant hereunder until his participation is
otherwise terminated in accordance with the provisions of the Plan; provided,
however, that such Participant shall not be eligible to continue making
Participant Contributions hereunder; and, provided further, that such
Participant shall not be eligible to receive allocations of Employer
Contributions hereunder. If a person is transferred directly from employment
(iii) with the Company in a capacity other than as an Employee or (iv) with a
Related Corporation, to employment with the Company as an Employee, his service
with the Company or other Related Corporation shall be included in determining
his eligibility to participate in the Plan under Section 3.1.
ARTICLE IV
CONTRIBUTIONS
4.1 PARTICIPANT CONTRIBUTIONS:
[a] Rate of Participant Contributions: As a condition of
eligibility to share in Company Matching Contributions (if
any), a Participant must elect to make Participant
Contributions to this Plan of from one percent to 16 percent of
his Compensation (in whole percentage increments).
[b] Participant Contribution Elections: At the Participant's
election, Participant Contributions may be made either on an
after-tax basis (hereinafter "After-Tax Contributions") or on a
pre-tax basis under a salary reduction agreement (hereinafter
"Pre-Tax Contributions"). Elections must be (i) made in
accordance with procedures prescribed by the Plan
Administrator, (ii) made on the form provided by the Plan
Administrator for such purpose, and (iii) filed with the Plan
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Administrator such number of days prior to the election's
effective date as the Plan Administrator shall prescribe.
Elections to make Participant Contributions shall be
prospective only. Participant Contributions will be paid
into the Trust Fund by the Company monthly.
[c] Change of Participant Contributions: A Participant may change
the rate of Participant Contributions prospectively but not
retroactively by completing and timely filing, as prescribed by
the Plan Administrator, the appropriate form with the Plan
Administrator (on the form provided by the Plan Administrator
for such purpose) during the month preceding the month in which
the change is to become effective. The rate of After-Tax
Contributions or Pre-Tax Contributions may be changed not more
frequently than once in any month effective as of the first pay
period in the month following the timely filing of the
appropriate form with the Plan Administrator.
In the event it becomes necessary for Highly Compensated
Employees to change the rate of Contributions, as set forth in
Section 4.3, said Highly Compensated Employees shall be
permitted to do so in a manner deemed to be administratively
feasible. Moreover, in the event the Plan Administrator, or
its designee, deems it necessary to require Highly Compensated
Employees to change the rate of contributions because of the
likelihood of exceeding the limitations set forth in Section
4.3[a], said Highly Compensated Employees shall be required to
do so, after appropriate notice, in a manner deemed to be
administratively feasible.
[d] Suspension of Participant Contributions: A Participant may
suspend or resume After-Tax Contributions or Pre-Tax
Contributions by completing and timely filing, as prescribed by
the Plan Administrator, the appropriate form with the Plan
Administrator during the month preceding the month in which the
change is to become effective. After-Tax Contributions or
Pre-Tax Contributions shall be suspended or resumed effective
for the first pay period in the month following the timely
filing of the appropriate form provided by the Plan
Administrator for such purpose.
[e] Limit on After-Tax Contributions: For each Plan Year, the
total of a Participant's After-Tax Contributions to this and
any other qualified plan maintained by the Company or any
Related Corporation, when added to his Pre-Tax Contributions
for the Plan Year, may not exceed 16 percent of the
Participant's Compensation for the Plan Year.
[f] Limit on Pre-Tax Contributions: For each Plan Year, the total
of a Participant's Pre-Tax Contributions to this and any other
qualified plan maintained by the Company or any Related
Corporation, when added to his After-Tax Contributions for the
Plan Year, may not exceed 16 percent of the Participant's
Compensation for the Plan Year; provided, however, that
notwithstanding the foregoing provisions of this subsection
[g], the total of a Participant's Pre-Tax Contributions for a
year may not exceed $7,000 (as adjusted for cost-of-living by
the Secretary of the Treasury pursuant to Section 402[g][5] of
the Code as of each January 1).
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4.2 COMPANY MATCHING CONTRIBUTIONS: For the Short Plan Year during which
the Plan is adopted and each Plan Year thereafter, the Company shall contribute
to the Plan such amounts, which amounts will be "Company Matching
Contributions" hereunder, as follows:
[a] For the Short Plan Year, the Company shall contribute as
Company Matching Contributions hereunder an amount equal to 66
percent of the Participants' Pre-Tax Contributions and
After-Tax Contributions for such Short Plan Year not in excess
of six percent of such Participants' Compensation for such
Short Plan Year.
[b] For the Plan Year which begins January 1, 1995 and ends
December 31, 1995, the Company shall contribute as Company
Matching Contributions hereunder an amount equal to 66 percent
of the Participants' Pre-Tax Contributions and After-Tax
Contributions for such 1995 Plan Year not in excess of six
percent of such Participants' Compensation for such 1995 Plan
Year.
[c] For any Plan Year which begins after December 31,1995, the
Company shall contribute as Company Matching Contributions
hereunder an amount equal to 50 percent of the Participants'
Pre-Tax Contributions and After-Tax Contributions for such Plan
Year not in excess of six percent of such Participants'
Compensation for such Plan Year.
[d] For the Short Plan Year or any other Plan Year, the Company may
in its discretion contribute as additional Company Matching
Contributions hereunder such amount (if any) as shall be
determined by the board of directors of the Company.
Company Matching Contributions shall be paid to the Trustee within the period
of time prescribed by law to permit a Federal income tax deduction for such
year. Company Matching Contributions shall be (i) made on behalf of Employees
of the Company who were Participants during the period for which such Company
Matching Contributions were authorized to be made, (ii) made on account of such
Participants' Pre-Tax Contributions and After-Tax Contributions that were
authorized to be matched with respect to such period, and (iii) allocated to
each such Participant's Account, in accordance with the provisions of Section
5.2, in proportion to each such Participant's Pre-Tax Contributions and
After-Tax Contributions that were authorized to be matched with respect to such
period. The Company that makes a Company Matching Contribution may, with the
approval of the Plan Administrator, specify that such Company Matching
Contribution be treated as a Pre-Tax Contribution for purposes of the tests
described in Section 4.3, in accordance with Section 401(k)(3)(D)(ii) of the
Code.
4.3 CONTRIBUTION LIMITATIONS:
[a] Limitations: Notwithstanding the provisions of Sections 4.1
and 4.2, Participant Contributions and Company Matching
Contributions to this Plan and any other qualified plan
maintained by the Company or any Related Corporation are
subject to the following limitations:
[1] The "Average Actual Deferral Percentage" (as defined in
subsection [c][2] below) for "Highly Compensated
Employees" (as defined in subsection [c][4] below) for
each Plan Year must be no greater than 1.25 times the
Average Actual Deferral
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Percentage for "Non-Highly Compensated Employees" (as
defined in subsection [c][4] below) for that Plan Year;
or, alternatively, the Average Actual Deferral
Percentage for Highly Compensated Employees may be two
times the Average Actual Deferral Percentage for
Non-Highly Compensated Employees if the Average Actual
Deferral Percentage for Highly Compensated Employees is
not more than two percentage points higher than the
Average Actual Deferral Percentage for Non-Highly
Compensated Employees for that Plan Year.
[2] The "Average Actual Contribution Percentage" (as defined
in subsection [c][1] below) for Highly Compensated
Employees for each Plan Year must be no greater than
1.25 times the Average Actual Contribution Percentage
for Non-Highly Compensated Employees for that Plan Year;
or, alternatively, the Average Actual Contribution
Percentage for Highly Compensated Employees may be two
times the Average Actual Contribution Percentage for
Non-Highly Compensated Employees if the Average Actual
Contribution Percentage for Highly Compensated Employees
is not more than two percentage points higher than the
Average Actual Contribution Percentage for Non-Highly
Compensated Employees for that Plan year.
[3] Anything contained in this subsection [a] to the
contrary notwithstanding, in computing the Average
Actual Deferral Percentage and the Average Actual
Contribution Percentage hereunder, such computations
shall be made in accordance with Treasury Regulation
Section 1.401(m)-2 to prevent the multiple use of the
alternative limitations described in clauses [1] and [2]
above.
[b] Return of Excess Contributions and Excess Aggregate
Contributions:
[1] If at the end of the Plan Year, or as soon as
administratively feasible, it is determined that the
Pre-Tax Contributions made on behalf of Highly
Compensated Employees would otherwise exceed the
limitations of subsection [a][1] above, first unmatched
and then matched Pre-Tax Contributions, and earnings
attributable to such Pre-Tax Contributions, shall be
returned to Highly Compensated Employees in the order of
their "Actual Deferral Percentages" (as defined in
subsection [c][2] below) beginning with those Highly
Compensated Employees with the highest Actual Deferral
Percentages. Alternatively, but only to the extent
permitted in regulations promulgated by the Secretary of
the Treasury, instead of receiving a distribution of
"Excess Contributions" (as defined in subsection [c][6]
below), a Highly Compensated Employee may elect to have
the Excess Contribution treated as an amount distributed
to the Highly Compensated Employee and then contributed
to the Plan by such Highly Compensated Employee as an
After-Tax Contribution, or the Company may
recharacterize such amounts in its sole discretion. In
addition, a Highly Compensated Employee may redirect
Pre-Tax Contributions as After-Tax Contributions for the
balance of the Plan Year if it is determined that the
Pre-Tax Contributions on
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behalf of such Highly Compensated Employee would
otherwise exceed the limitations of subsection [a][1]
above.
[2] In the event After-Tax Contributions or Company Matching
Contributions made by or on behalf of Highly Compensated
Employees would otherwise exceed the limitations of
subsection [a][2] above for a Plan Year, such After-Tax
Contributions or Company Matching Contributions, and the
earnings attributable to such After-Tax Contributions or
Company Matching Contributions, as applicable, will be
returned in the following order and assets shall be
liquidated on a pro rata basis from all investment
categories.
[A] excess unmatched After-Tax Contributions, and
earnings attributable to such unmatched After-Tax
Contributions, shall be returned to Highly
Compensated Employees;
[B] excess matched After-Tax Contributions, and
earnings attributable to such matched After-Tax
Contributions, shall be returned to Highly
Compensated Employees on the basis of the
respective portions of the excess contributions
attributable to each Highly Compensated Employee;
[C] excess Company Matching Contributions, and
earnings attributable to such Company Matching
Contributions, shall be distributed to each
Highly Compensated Employee to whose Account
"Excess Aggregate Contributions" (as defined in
subsection [c][5] below) were allocated for the
Plan Year.
[c] Definitions:
[1] The "Average Actual Contribution Percentage" means the
average (expressed as a percentage rounded to the
nearest hundredth of a percentage point) of the "Actual
Contribution Percentages" (as hereinafter defined) for a
specified group of Employees for a Plan Year. The
"Actual Contribution Percentage" for any Plan Year means
the ratio (expressed as a percentage rounded to the
nearest hundredth of a percentage point) of After-Tax
Contributions and Company Matching Contributions (in the
aggregate) made under the Plan or any other plan
maintained by the Company or a Related Corporation by or
on behalf of an Employee for the Plan Year to that
Employee's "compensation" (as defined in clause [3]
below) for the Plan Year.
[2] The "Average Actual Deferral Percentage" means the
average (expressed as a percentage rounded to the
nearest hundredth of a percentage point) of the "Actual
Deferral Percentages" (as hereinafter defined) for a
specified group of Employees for a Plan Year. The
"Actual Deferral Percentage" for any Plan Year means the
ratio (expressed as a percentage rounded to the nearest
hundredth of a percentage point) of Pre-Tax
Contributions and Qualified Non-Elective Contributions
made under the Plan or any other plan maintained by the
Company or a Related Corporation on behalf of an
Employee for the Plan Year to that Employee's
"compensation" (as defined in clause [3]
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below) for the Plan Year. Pre-Tax Contributions and
Qualified Non-Elective Contributions shall be taken into
account in determining the Actual Deferral Percentage
for a Plan Year only if (i) the Pre-Tax Contributions
and Qualified Non-Elective Contributions relate to
compensation that either would have been received by the
Employee in the Plan Year (but for the deferral
election) or is attributable to services performed by
the Employee in the Plan Year and would have been
received by the Employee within two and one-half months
after the close of the Plan Year (but for the deferral
election), and (ii) are not contingent on participation
or performance of services after such date and the
Pre-Tax Contribution or Qualified Non-Elective
Contribution is actually paid to the Trust no later than
12 months after the Plan Year to which the Pre-Tax
Contribution or Qualified Non-Elective Contribution
relates.
[3] For purposes of this Section 4.3, "compensation" means
compensation for services performed for the Company or
any Related Corporation that is currently includible in
gross income plus any amount contributed to this Plan or
any other plan maintained by the Company or any Related
Corporation as a pre-tax contribution plan, including
any amount deferred under a Code Section 125 plan
maintained by the Company or any Related Corporation.
[4] The term "Highly Compensated Employee" means "highly
compensated active employees" and "highly compensated
former employees" (as hereinafter defined).
A "highly compensated active employee" means any
Employee who performs services for the Company during
the "determination year" (as hereinafter defined) and
who, during the "look-back year" (as hereinafter
defined),: (i) received compensation from the Company in
excess of $75,000 (as adjusted for cost-of-living
pursuant to Section 415(d) of the Code); (ii) received
compensation from the Company in excess of $50,000 (as
adjusted for cost-of-living pursuant to Section 415(d)
of the Code) and was a member of the top-paid group for
such year; or (iii) was an officer of the Company and
received compensation during such year that is greater
than 50 percent of the dollar limitation in effect under
Section 415(b)(1)(A) of the Code. The term "highly
compensated active employee" also includes: (iv)
Employees who are described in the preceding sentence if
the term "determination year" is substituted for the
term "look-back year" and are one of the 100 employees
who received the most compensation from the Company
during the determination year; and (v) Employees who are
5 percent owners at any time during the look-back year
or the determination year. If no officer has satisfied
the compensation requirement of item (iii) above during
either a determination year or a look-back year, the
highest-paid officer for such year shall be treated as a
"highly compensated active employee".
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For purposes of this clause [4], the "determination
year" shall be the Plan Year; and the "look-back year"
shall be the 12-month period immediately preceding the
determination year.
A "highly compensated former employee" means any
Employee who (A) separated from service (or was deemed
to have separated from service) prior to the
determination year, (B) performs no service for the
Company during the determination year, and (C) was a
highly compensated active employee for either the year
of separation or any determination year ending on or
after the Employee's 55th birthday.
If an Employee is, during a determination year or
look-back year, a family member of either a 5 percent
owner who is an active or former Employee or a Highly
Compensated Employee who is one of the ten most Highly
Compensated Employees ranked on the basis of
compensation paid by the Company during such year, the
family member shall be aggregated with the 5 percent
owner or the top-ten Highly Compensated Employee, as
applicable. In such case, the family member and 5
percent owner or top-ten Highly Compensated Employee, as
applicable, shall be treated as a single Employee
receiving compensation and Plan Compensation and
contributions. For purposes of this clause [4], "family
member" includes the spouse, lineal ascendants and
descendants of the Employee or former Employee and the
spouses of such lineal ascendants and descendants.
The determination of who is a Highly Compensated
Employee, including determinations of the number and
identity of Employees in the top-paid group, the top 100
Employees, the number of Employees treated as officers
and the compensation to be considered, will be made in
accordance with Section 414(g) of the Code and the
regulations promulgated thereunder.
The term "Non-Highly Compensated Employee" means any
Employee who is not a Highly Compensated Employee.
[5] "Excess Aggregate Contributions" means, with respect to
any Plan Year, the excess of:
[A] the aggregate amount of After-Tax Contributions
and Company Matching Contributions (and Qualified
Non-Elective Contributions or elective
contributions taken into account in computing the
Average Actual Contribution Percentage) made on
behalf of Highly Compensated Employees, over
[B] the maximum aggregate amount of After-Tax
Contributions and Company Matching Contributions
permitted under the Average Actual Contribution
Percentage test described in subsection [a][1]
above.
[6] "Excess Contributions" means, with respect to any Plan
Year, the excess of:
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[A] the aggregate amount of Pre-Tax Contributions
actually paid over to the Trust on behalf of
Highly Compensated Employees, over
[B] the maximum amount of Pre-Tax Contributions
permitted under the Average Actual Deferral
Percentage test described in subsection [a][2]
above.
4.4 QUALIFIED NON-ELECTIVE CONTRIBUTIONS: In lieu of distributing Excess
Contributions as provided in Section 4.3[b][1], or Excess Aggregate
Contributions as provided in Section 4.3[b][2], the Company may make "Qualified
Non-Elective Contributions" (as hereinafter defined) on behalf of Non-Highly
Compensated Employees that are sufficient to satisfy either the Average Actual
Deferral Percentage test or the Average Actual Contribution Percentage test, or
both, pursuant to regulations promulgated under the Code. In addition, the
Company may make additional discretionary contributions on behalf of Non-Highly
Compensated Employees that are sufficient to satisfy the Average Actual
Contribution Percentage Test, pursuant to regulations promulgated under the
Code.
"Qualified Non-Elective Contributions" mean contributions made by the Company
(other than Company Matching Contributions) and allocated to Participants'
Accounts that (i) Participants may not elect to receive in cash until
distributed from the Plan, (ii) are nonforfeitable when made, and (iii) are
distributable only in accordance with the distribution provisions applicable to
Pre-Tax Contributions and Company Matching Contributions.
If the Company makes Qualified Non-Elective Contributions to the Plan, the
amount of such Qualified Non-Elective Contributions for a Plan Year shall be an
amount determined by the Company.
Allocation of Qualified Non-Elective Contributions shall be made (i) on a per
capita basis or (ii) in the ratio which each Non-Highly Compensated Employee's
"compensation" (as defined in Section 4.3[c][3] for the Plan Year bears to the
total compensation of all Non-Highly Compensated Employees for such Plan Year;
provided, however, that unless the Company determines otherwise, only
Non-Highly Compensated Employees who are Participants shall be entitled to
share in the allocation of Qualified Non-Elective Contributions.
4.5 LIMITATION ON ANNUAL ADDITIONS: For purposes of this Section 4.5,
"annual additions" mean Company Contributions, Participant Contributions and
forfeitures (if any). "Annual additions" shall not include (i) Rollover
Contributions (if any), or (ii) company contributions described in Section
415(6) of the Code. For purposes of applying the limitations of Section 415 of
the Code, the "limitation year" is the Plan Year. If the annual additions to
the Account of any Participant, attributable to all defined contribution plans
of the Company and any Related Corporation, would exceed either (A) $30,000 (as
adjusted for cost-of-living by the Secretary of the Treasury as of each January
1 for any limitation year ending during the calendar year) or (B) 25 percent of
the Participant's "compensation" (as hereinafter defined), the excess amount
will be disposed of in the following order:
[a] First, unmatched Participant After-Tax Contributions, to the
extent that the return would reduce the excess amount, will be
returned to the Participant;
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[b] Second, matched Participant After-Tax Contributions, to the
extent the return would reduce the excess amount, will be
returned to the Participant with any Matching Company
Contributions reduced as a consequence and allocated under
subsection [d] or [e] below; and
[c] Third, Company Contributions, to the extent the reduction
would reduce the excess amount, will be allocated under
subsection [d] or [e] below.
[d] The amount of any excess attributable to Company Contributions
will be applied to offset Company Matching Contributions for
the limitation year; and
[e] To the extent that the excess amounts described in subsection
[d] above cannot be applied to offset Company Matching
Contributions for the limitation year, the excess amounts will
be allocated to a suspense account and applied to offset
Company Matching Contributions in succeeding limitation years,
as necessary.
For purposes of limiting annual additions under this Section 4.5 and limiting
combined benefits and contributions under Section 4.6, "compensation" means
wages for federal tax withholding purposes, as defined in Section 3401(a) of
the Code, but determined without regard to any rules that limit remuneration
included in wages based on the nature or location of employment or the services
performed. Thus, for purposes of applying the limitations of Sections 4.5 and
4.6, compensation for a limitation year is the compensation actually paid or
includible in gross income during such limitation year. Notwithstanding the
preceding sentences, "compensation" for a participant in a defined contribution
plan who is "permanently and totally disabled" (as defined in Section 22(e)(3)
of the Code) is the compensation such participant would have received for the
limitation year if the participant had been paid at the rate of compensation
paid immediately before becoming permanently and totally disabled; provided,
however, such imputed compensation for the disabled participant may be taken
into account only if the participant is not a Highly Compensated Employee (as
defined in Section 4.3[c][4]) and contributions made on behalf of such
participant are nonforfeitable when made.
Anything contained herein to the contrary notwithstanding, compensation taken
into account for purposes of applying the limitations of Sections 4.5 and 4.6
for any participant shall not exceed $150,000 (subject to adjustment annually
by the Secretary of the Treasury as provided in Sections 401(a)(17)(b) and
415(d) of the Code).
4.6 LIMITATION ON COMBINED BENEFITS AND CONTRIBUTIONS UNDER ALL DEFINED
BENEFIT PLANS AND DEFINED CONTRIBUTION PLANS OF THE COMPANY AND ANY RELATED
CORPORATION: In any limitation year, if the Company makes contributions to a
defined benefit plan on behalf of an Employee who is also a Participant in this
Plan, then the sum of the "defined benefit plan fraction" and the "defined
contribution plan fraction" (as defined in subsections [a] and [b] below, as
applicable) for the Employee for the limitation year may not exceed 1.0. In
any limitation year, if the sum of the defined benefit plan fraction and the
defined contribution plan fraction on behalf of a Participant would exceed 1.0,
the benefit accrued on that Participant's behalf under the defined benefit plan
will be limited, to the extent necessary, to prevent the sum of the defined
benefit plan fraction and the defined contribution plan fraction from exceeding
1.0.
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[a] Defined Benefit Plan Fraction: The "defined benefit plan
fraction" is a fraction, the numerator of which is the
projected annual benefit of the Participant under the defined
benefit plan (determined as of the close of the limitation
year) and the denominator of which is the lesser of the
following amounts determined for that year and for each prior
year of service with the Company:
[1] the product of 1.25 times the maximum benefit dollar
limitation in effect for the limitation year; or
[2] the product of 1.4 times 100 percent of the
Participant's average compensation for his high three
consecutive calendar years.
In determining the defined benefit plan fraction, all defined
benefit plans of the Company or a Related Corporation (whether
or not terminated) shall be treated as one defined benefit
plan.
[b] Defined Contribution Plan Fraction: The "defined contribution
plan fraction" is a fraction, the numerator of which is the sum
of the annual additions to the Participant's accounts under all
defined contribution plans of the Company or a Related
Corporation as of the close of the limitation year and the
denominator of which is the sum of the lesser of the following
amounts determined for that year and for each prior year of
service with the Company:
[1] the product of 1.25 times the dollar limitation in
effect under Section 415(c)(1)(A) of the Code for the
limitation year (without regard to Section 415(c)(6) of
the Code); or
[2] the product of 1.4 times an amount equal to 25 percent
of the Participant's compensation for the limitation
year.
4.7 EXCLUSIVE BENEFIT: This Plan and Trust have been established for the
exclusive benefit of Participants and their Beneficiaries. Under no
circumstances may any funds contributed to the Plan or held by the Trustee at
any time revert to or be used by the Company, except that all contributions by
the Company to the Plan are conditioned upon both the qualification of the Plan
and the deductibility of such contributions. At the Company's written request
to the Trustee, a contribution by the Company shall be returned to the Company
within one year of (i) the date of payment if the contribution was made by
mistake of fact; (ii) the date initial qualification or qualification on Plan
amendment is denied, provided the amendment is submitted to the Internal
Revenue Service for a determination on qualification within one year after it
is adopted; or (iii) the date deduction of a contribution is disallowed. The
amount returned may not include net earnings but may be adjusted for net losses
attributable to the contribution.
4.8 COMPANY'S OBLIGATIONS: The adoption and continuance of the Plan will
not be deemed to constitute a contract between the Company and any Employee or
Participant, nor to be consideration for, nor inducement nor condition of, the
employment of any person. Nothing in this Plan will be deemed to give any
Employee or Participant the right to be retained in the employ of the Company
or to interfere with the right of the Company to discharge any Employee or
Participant at any time, nor will it be deemed to give the Company the right to
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require the Employee or Participant to remain in its employ, nor will it
interfere with the right of any Employee or Participant to terminate his
employment at any time.
4.9 ROLLOVER CONTRIBUTIONS: The Trustee shall accept funds transferred
from a trust forming part of a plan that is qualified under Section 401(a) of
the Code or from a conduit individual retirement account for the benefit of a
Participant under this Plan if the trust from which the funds are so
transferred allows the transfer; provided, however, that the Plan Administrator
shall not permit the Trustee to accept a transfer of funds if such funds would
require this Plan to pay benefits in the form of an annuity, or if, in the
opinion of counsel, such funds would jeopardize the tax-qualified status of the
Plan. Any amount transferred to the Plan in accordance with the provisions of
this Section 4.9 shall be known as a "Rollover Contribution". In the event the
Internal Revenue Service determines that all or any portion of a Rollover
Contribution does not satisfy the requirements for rollover contributions under
law, such Rollover Contribution, or the applicable portion thereof, shall be
distributed to the Participant in a single sum as soon as administratively
possible. The Trustee shall maintain a separate account for any Rollover
Contributions made hereunder.
ARTICLE V
PARTICIPANTS' ACCOUNTS
5.1 PARTICIPANT'S SUBACCOUNTS: The Plan Administrator will maintain one
or more separate subaccounts for each Participant in the following categories
to which contributions and Trust earnings or losses, as applicable, will be
credited as provided in the Plan:
[a] Matched After-Tax Subaccount, to which a Participant's matched
After-Tax Contributions (if any) and earnings and losses
attributable thereto will be credited;
[b] Unmatched After-Tax Subaccount, to which a Participant's
Unmatched After-Tax Contributions (if any) and earnings and
losses attributable thereto will be credited;
[c] Matched Pre-Tax Subaccount, to which a Participant's matched
Pre-Tax Contributions (if any) and earnings and losses
attributable thereto will be credited;
[d] Unmatched Pre-Tax Subaccount, to which a Participant's
unmatched Pre-Tax Contributions (if any) and earnings and
losses attributable thereto will be credited;
[e] Company Contributions Subaccount, to which a Participant's
share of Company Matching Contributions (if any) and earnings
and losses attributable thereto will be credited;
[f] Rollover Subaccount, to which a Participant's Rollover
Contributions (if any) and earnings and losses attributable
thereto will be credited; and
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[g] Transfer Subaccount, to which a Participant's Transfer
Contributions (if any) and earnings and losses attributable
thereto will be credited.
5.2 ALLOCATION OF CONTRIBUTIONS:
[a] Allocation of Company Matching Contributions: Company Matching
Contributions made pursuant to Section 4.2 shall be allocated
as follows:
[1] Company Matching Contributions for the Short Plan Year,
which Company Matching Contributions are made pursuant
to Section 4.2[a], shall be allocated to Participants'
Accounts, with the allocation to each such Participant's
Account to equal 66 percent of such Participant's
Pre-Tax Contributions and After-Tax Contributions for
the Short Plan Year not in excess of six percent of such
Participant's Compensation for such Short Plan Year.
[2] Company Matching Contributions for the Plan Year that
begins January 1, 1995 and ends December 31, 1995, which
Company Matching Contributions are made pursuant to
Section 4.2[b], shall be allocated to Participants'
Accounts, with the allocation to each such Participant's
Account to equal 66 percent of such Participant's
Pre-Tax Contributions and After-Tax Contributions for
the 1995 Plan Year not in excess of six percent of such
Participant's Compensation for such 1995 Plan Year.
[3] Company Matching Contributions for any Plan Year
beginning after December 31, 1995, which Company
Matching Contributions are made pursuant to Section
4.3[c], shall be allocated to Participants' Accounts,
with the allocation to each such Participant's Account
to equal 50 percent of such Participant's Pre-Tax
Contributions and After-Tax Contributions for the Plan
Year not in excess of six percent of such Participant's
Compensation for such Plan Year.
[4] Discretionary Company Matching Contributions (if any)
for the Short Plan Year or any other Plan Year, as
applicable, which discretionary Company Matching
Contributions are made pursuant to Section 4.3[d], shall
be allocated to Participants' Accounts, with the
allocation to each such Participant's Account to equal a
specified percentage of such Participant's Pre-Tax
Contributions and After-Tax Contributions for the Plan
Year or Short Plan Year, as applicable, not in excess of
a specified percentage of such Participant's
Compensation for such Plan Year or Short Plan Year, as
applicable, and which percentages shall be specified by
the board of directors of the Company.
[b] Allocation of Participant Contributions: Participant
Contributions received by the Trustee will be credited to the
Participant's Account as soon as the amounts to be credited to
such Participant's Account can be determined.
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5.3 VESTING OF PARTICIPANT'S ACCOUNT:
[a] Participant Contributions: A Participant's interest in his
Participant Contributions will at all times be fully vested and
nonforfeitable.
[b] Company Contributions: A Participant's interest in his Company
Contributions will at all times be fully vested and
nonforfeitable.
[c] Rollover Contributions: A Participant's interest in his
Rollover Contributions will at all times be fully vested and
nonforfeitable.
[d] Transfer Contributions: A Participant's interest in his
Transfer Contributions will at all times be fully vested and
nonforfeitable.
5.4 TRANSFER OF ACCOUNTS UPON TRANSFER OF EMPLOYMENT: Notwithstanding any
other provision of the Plan to the contrary, the Plan Administrator may direct
the Trustee to transfer to or accept a transfer from any other defined
contribution plan maintained by the Company or a Related Corporation that is
qualified under Section 401(a) of the Code of the account(s), if any, of an
employee whose employment transfers (i) to employment covered by the Plan from
employment covered by such other plan or (ii) from employment covered by the
Plan to employment covered by such other plan. If the accounts(s) from another
qualified defined contribution plan maintained by the Company or a Related
Corporation are transferred to or merged into the Plan, such account(s) shall
be held and administered in accordance with any restrictions applicable to them
under such other plan to the extent required by law and shall be accounted for
separately to the extent necessary to accomplish the foregoing. Under rules
prescribed by the Plan Administrator, any applications, elections, designations
and waivers under the transferor plan that are applicable to such transferred
account(s) shall be applicable hereunder. In addition, any loan outstanding
under the transferor plan with respect to such transferred account(s) shall
become a loan under the Plan and shall continue to be repaid and otherwise
governed under the Plan by the terms of such loan as made under the transferor
plan. The Plan Administrator shall direct the Trustee to transfer any such
account(s) at such time(s) as the Plan Administrator determines that the
limitations contained in Section 4.3 and any other applicable limitations have
been or will be satisfied and any remedial action required to comply with such
limitations has been or will be taken under the Plan or the transferor plan, as
applicable.
ARTICLE VI
INVESTMENT OF ACCOUNTS
6.1 INVESTMENT CATEGORIES: The following investment categories will be
offered:
[a] T. Rowe Price Prime Reserve Fund;
[b] T. Rowe Price Stable Value Fund;
[c] T. Rowe Price Spectrum Income Fund;
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[d] T. Rowe Price Equity Index Fund;
[e] T. Rowe Price Capital Appreciation Fund;
[f] T. Rowe Price International Stock Fund;
[g] T. Rowe Price New America Growth Fund;
[h] Cyprus Stock Fund; and
[i] Cliffs Stock Fund;
provided, however, that: (i) the Cliffs Stock Fund shall not be available as
an investment category until the required registration has been made with the
Securities and Exchange Commission; and (ii) the Cyprus Stock Fund shall only
be available as an investment category for a period of 24 months, which
24-month period shall commence with the day upon which assets are first
transferred from the Cyprus Amax Minerals Company Savings Plan & Trust (the
"Cyprus Savings Plan") to this Plan (the "Transfer Date"); and, provided
further, that a Participant may only invest such amounts in the Cyprus Stock
Fund as are invested in the common stock of Cyprus Amax Minerals Company under
the Cyprus Savings Plan on the day preceding the Transfer Date. In connection
with item (ii) above, any Participant who maintains an investment in the Cyprus
Stock Fund must liquidate such investment prior to the expiration of the
24-month period described above and reinvest such liquidated amount in one or
more of the investment categories then available under the Plan.
6.2 CONTINUING INVESTMENT: A Participant may direct the continuing
investment of Participant Contributions, Company Contributions, Rollover
Contributions and Transfer Contributions in any one or more of the investment
categories specified in Section 6.1 at any time, subject, however, to the
limitations described in Section 6.1 regarding investment in the Cyprus Stock
Fund; and such investment direction shall be effective for the month of the
direction. If the Participant directs continuing investment in more than one
investment category, the portion in each investment category must be specified
as a percentage of the total in multiples of one percent. A Participant may
change future investment directions at any time. This change will be effective
for the month of the direction if the Trustee is notified of the change before
the end of such month. Earnings on assets credited to a Participant's Account
shall be invested in the investment category which produced such earnings.
6.3 CHANGE OF INVESTMENT HOLDINGS: A Participant may direct the Trustee
on any business day to sell any investments in the Participant's account, and
the Participant may direct that the proceeds of such sale be invested in any
one or more of the other investment categories listed in Section 6.1, subject,
however, to the limitations described in Section 6.1 regarding investment in
the Cyprus Stock Fund.
6.4 INTERIM INVESTMENT: In the absence of effective investment
directions, the Plan Administrator will direct the Trustee to invest any cash
in the T. Rowe Price Prime Reserve Fund.
6.5 VALUATION OF PARTICIPANT'S ACCOUNT: Except as otherwise provided in
the case of distributions under Article VII, a Participant's Account will be
valued each business day that the Trustee is open for business.
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ARTICLE VII
DISTRIBUTION FROM TRUST FUND
7.1 WHEN ACCOUNT BECOMES DISTRIBUTABLE: If a Participant dies, suffers
Total Disability, retires or Terminates Employment for any other reason, his
Account will be distributable.
7.2 TIME AND FORM OF PAYMENT:
[a] Time of Payment: Upon Termination of Employment, a Participant
may file a written claim for distribution of his Account with
the Plan Administrator on a form prescribed by the Plan
Administrator for such purpose. In such event, distribution of
a Participant's Account will be made within 90 days after the
calendar quarter during which the Participant's Termination of
Employment occurs or the Participant receives his last payroll
check. If no claim for distribution is filed by the
Participant upon Termination of Employment, the Plan
Administrator will schedule a payment date which shall be 60
days after the end of the Plan Year during which the
Participant attains Normal Retirement Age; provided, however,
that a Participant who Terminates Employment may elect a
delayed distribution date, which delayed distribution date must
be no later than April 1 of the calendar year following the
calendar year in which the Participant attains age 70-1/2. A
delayed distribution date may be accelerated at the
Participant's written direction to the Plan Administrator as
follows: a Participant may file a written claim for
distribution of his Account with the Plan Administrator, on a
form prescribed by the Plan Administrator for such purpose, at
any time after Termination of Employment; and, in such event,
distribution of his Account will occur within 90 days following
the calendar quarter during which the Participant files a
written claim for such distribution.
[b] Anything contained herein to the contrary notwithstanding
distribution to a Participant must begin no later than April 1
of the calendar year following the calendar year in which the
Participant attains age 70-1/2, with subsequent annual single
sum payments made thereafter of amounts accrued (if any) during
each subsequent calendar year. If the distribution of the
entire interest of a Participant has begun in accordance with
the foregoing provisions of this Section 7.2[b] and the
Participant dies before his entire interest has been
distributed to him, the remaining portion of such interest
shall be distributed at least as rapidly as under the method of
distribution being used at the date of the Participant's death.
All distributions required under this Section 7.2[b] shall be
determined and made in accordance with Treasury Regulations
promulgated under Section 401(a)(9) of the Code, including the
minimum distribution incidental benefit requirement of Treasury
Regulation Section 1.401(a)(9)-2.
[c] Payment in Cash or in Kind: At a Participant's or
Beneficiary's request, payment of the portion of the
Participant's Account invested in the Cliffs Stock Fund may be
made in cash or in kind or partly in
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cash and partly in kind; provided, however, that fractional shares of
Cliffs Stock will be paid in cash. Payment of the remainder of the
Participant's Account shall be made in cash. Distributions in cash
will be the liquidation proceeds of the assets in the Participant's
Account. The Plan Administrator will direct the Trustee to make
payment in cash or in kind or partly in cash and partly in kind, as
hereinbefore set forth; provided, however, that when directing the
form of payment, the Plan Administrator will make any necessary
adjustment on account of an outstanding loan the Participant may have
under Section 7.9.
[d] Form of Payment: Distribution of a Participant's Account will
be made in a single sum payment.
7.3 DISPOSITION OF ACCOUNT ON TERMINATION OF EMPLOYMENT: Anything
contained herein to the contrary notwithstanding, if a Participant's employment
is terminated and the value of his account is $3,500 or less (taking into
account both Company Contributions and Participant Contributions) the
Participant's Account shall be distributed as soon as administratively feasible
following the Participant's Termination of Employment. If the value of the
Participant's Account is in excess of $3,500, such Account shall not be
distributed to the Participant without his prior written consent and, if the
Participant is married, the prior written consent of his spouse.
7.4 DIRECT ROLLOVER OF DISTRIBUTIONS: Notwithstanding any provision of
the Plan to the contrary that would otherwise limit a "distributee's" (as
defined in subsection [b] below) election under this Section 7.4, a distributee
may elect, at the time and in the manner prescribed by the Plan Administrator,
to have any portion of an "eligible rollover distribution" (as defined in
subsection [d] below) paid directly to an "eligible retirement plan" (as
defined in subsection [c] below) specified by the distributee in a "direct
rollover" (as defined in subsection [a] below). For purposes of this Section
7.4, the following definitions shall apply:
[a] A "direct rollover" is a payment by the Plan to the eligible
retirement plan specified by the distributee.
[b] A "distributee" includes an Employee or former Employee. In
addition, the Employee's or former Employee's surviving spouse
and the Employee's or former Employee's spouse or former spouse
who is the alternate payee under a "qualified domestic
relations order" (as defined in Section 414(p) of the Code) are
"distributees" with regard to the interest of the spouse or
former spouse.
[c] An "eligible retirement plan" is 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 the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to
the surviving spouse, an "eligible retirement plan" is an
individual retirement account or individual retirement annuity.
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[d] An "eligible rollover distribution" is any distribution of all
or any portion of the balance to the credit of the distributee,
except that "eligible rollover distribution" does not include:
(i) any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually)
made for the life (or life expectancy) of the distributee or
the joint lives (or joint life expectancies) of the distributee
and the distributee's designated beneficiary, or for a
specified period of ten years or more; (ii) any distribution to
the extent such distribution is required under Section
401(a)(9) of the Code; and (iii) the portion of any
distribution that is not includible in gross income (determined
without regard to the exclusion for net unrealized appreciation
with respect to employer securities).
7.5 SPENDTHRIFT TRUST PROVISIONS: Except for benefits payable in
accordance with the applicable requirements of a domestic relations order
determined by the Plan Administrator to be a "qualified domestic relations
order" (as defined in Section 414(p) of the Code), all benefits payable by the
Plan will be paid only to the person entitled to them, and all payments will be
made directly to that person and not to any other person or corporation.
Benefits will not be subject to the claim of any creditor of a Participant, nor
may payments be taken in execution by attachment or garnishment or by any other
legal or equitable proceeding. No person will have any right to alienate,
anticipate, commute, pledge, encumber or assign any benefits that he may expect
to receive, contingently or otherwise, under this Plan, except the right to
designate a Beneficiary or Beneficiaries.
7.6 DISTRIBUTION IN THE EVENT OF DEATH: If the Participant dies before
distribution of his interest begins, distribution of the Participant's entire
interest shall, at the Beneficiary's election, be made as soon as practicable
following the Participant's death; provided, however, that if the Beneficiary
elects a later distribution date, the Participant's entire interest must be
distributed to the Beneficiary by December 31 of the calendar year containing
the fifth anniversary of the Participant's death; and, provided further, that
if the Beneficiary is the Participant's spouse and such spouse Beneficiary
elects a later distribution date, the Participant's entire interest must be
distributed to the Beneficiary no later than April 1 of the calendar year
following the calendar year in which the Participant would have attained age
70-1/2.
7.7 BENEFICIARIES:
[a] Designation of Beneficiary: A Participant shall designate a
Beneficiary on a form prescribed by the Plan Administrator for
such purpose and shall file such Beneficiary designation with
the Plan Administrator. The Beneficiary designation will
become effective only upon receipt of the form by the Plan
Administrator, but upon receipt of the form the designation
will relate back to and take effect as of the date the
Participant signed the designation, whether or not the
Participant is living at the time; provided, however, that
neither the Plan Administrator nor the Company will be liable
for any payment of the Participant's Account made prior to
receipt of the form designating a Beneficiary.
[b] Order of Payment: If the Participant fails to designate a
Beneficiary before his death, or if no designated Beneficiary
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survives the Participant, the Participant's undistributed
Account will be paid in a single sum to the person, persons or
entity in the first of the following classes of successive
preference surviving the death of the Participant:
[1] spouse of the Participant,
[2] children of the Participant,
[3] parents of the Participant,
[4] brothers and sisters of the Participant, or
[5] the Participant's estate.
These provisions will be deemed modified where necessary to
comply with the applicable law of any state.
[c] Change of Beneficiary: A Participant may designate a new
Beneficiary at any time by filing with the Plan Administrator a
written change of Beneficiary on a form prescribed by the Plan
Administrator for such purpose. The change will become
effective only upon receipt of the form by the Plan
Administrator, but upon receipt of the form the change will
relate back to and take effect as of the date the Participant
signed the request, whether or not the Participant is living at
the time of receipt; provided, however, that neither the Plan
Administrator nor the Company will be liable for any payment of
the Participant's Account made prior to receipt of the form
designating a change of Beneficiary.
[d] Spousal Consent: Anything contained in this Section 7.7 to the
contrary notwithstanding, no Beneficiary designation or change
of Beneficiary under this Plan will be effective unless the
spouse (if any) of the Participant consents in writing thereto.
Such spousal consent shall be irrevocable and must acknowledge
the effect of the election and be witnessed by a Plan
representative or notary public. Spousal consent will not be
required if it is established to the satisfaction of the Plan
Administrator that such consent cannot be obtained because the
Participant has no spouse or because the spouse cannot be
located. Any election, consent or Beneficiary designation that
has the effect of revoking a waiver of a surviving spouse's
benefit may be made by a Participant without spousal consent
anytime before payment of a Participant's Account is made under
the Plan.
[e] Uncertainty as to Right of Beneficiary: If the Plan
Administrator is in doubt as to the right of any Beneficiary,
the amount in question may be paid to the estate of the
Participant, in which event neither the Plan Administrator nor
the Company will be under any further liability to anyone with
respect to the Account of the Participant.
[f] Participant or Beneficiary Whose Whereabouts Are Unknown: In
the case of any Participant or Beneficiary whose whereabouts
are unknown, the Plan Administrator will notify the Participant
or Beneficiary at his last known address by certified mail,
return receipt requested, advising him of his right to a
pending distribution. If the
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Participant or Beneficiary cannot be located in this manner, the Plan
Administrator may (i) direct the benefits be deposited with the
registry of the appropriate district court, (ii) establish an account
in the Participant's name until it is claimed or until proof of death
satisfactory to the Plan Administrator is received by the Plan
Administrator, or (iii) declare the Account forfeited; provided,
however, that if a written claim for forfeited benefits is
subsequently made by the Participant or Beneficiary, the amount
forfeited, unadjusted for earnings or interest, will be paid to the
Participant or Beneficiary, as applicable.
7.8 WITHDRAWALS DURING SERVICE: A Participant who is an Employee or who
is in an ineligible class of employees and has not experienced a Termination of
Employment may elect at any time, but not more than twice in any Plan Year, to
withdraw, in whole or in part, the value of his Account, subject to the
limitations set forth in this Section 7.8. A Participant shall initiate a
withdrawal request by timely executing and filing a written election with the
Plan Administrator on a form prescribed by the Plan Administrator for such
purpose, which form shall require such information as the Plan Administrator
from time to time determines is needed to process the withdrawal request. Any
amounts withdrawn pursuant to this Section 7.8 may not be repaid.
[a] Order of Withdrawals: Withdrawals by a Participant shall be
made from the Participant's subaccounts in the order listed
below:
[1] any portion of his subaccounts attributable to the
principal amount of the Participant's After-Tax
Contributions (including the Participant's Transfer
Contributions attributable to after-tax contributions)
and income attributable thereto;
[2] any portion of his subaccounts attributable to the
principal amount of Rollover Contributions (including
the Participant's Transfer Contributions attributable to
rollover contributions), and then any portion of his
subaccounts attributable to income on such Rollover
Contributions (including income on the Participant's
Transfer Contributions attributable to rollover
contributions);
[3] in the case of a Participant who has attained at least
age 59-1/2, any portion of his subaccounts attributable
to the principal amount of Pre-Tax Contributions
(including the Participant's Transfer Contributions
attributable to pre-tax contributions), and then any
portion of his subaccounts attributable to income on
such Pre-Tax Contributions (including income on the
Participant's Transfer Contributions attributable to
pre-tax contributions); and
[4] in the case of a Participant who has not attained age
59-1/2, any portion of his subaccounts attributable to
the principal amount of Pre-Tax Contributions (including
the Participant's Transfer Contributions attributable to
pre-tax contributions).
No withdrawal may be made under clauses [1] through [4] above
unless all amounts that may be withdrawn under each preceding
clause have been withdrawn.
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[b] Restriction on Withdrawals of Pre-Tax Contributions Where
Participant Is Less than Age 59-1/2: Anything contained in
this Section 7.8 to the contrary notwithstanding, a Participant
under the age of 59-1/2 may only withdraw the portion of his
Account attributable to Pre-Tax Contributions "on account of
hardship", as determined by the Plan Administrator on a uniform
and nondiscriminatory basis in accordance with the following
provisions:
[1] A withdrawal "on account of hardship" shall mean a
distribution that is (i) made on account of a
Participant's "immediate and heavy financial need" (as
defined in clause [2] below), and (ii) "necessary to
satisfy the immediate and heavy financial need" (as
defined in clause [3] below).
[2] A distribution that is made on account of a
Participant's "immediate and heavy financial need" means
a distribution that is made for one or more of the
following reasons:
[A] expenses for medical care described in Section
213(d) of the Code previously incurred by the
Participant, the Participant's spouse or any
"dependents" (as defined in Section 152 of the
Code) of the Participant or necessary for those
persons to obtain the medical care described in
Section 213(d) of the Code;
[B] costs directly related to the purchase of a
principal residence for the Participant
(excluding mortgage payments);
[C] payment of tuition and related education fees for
the next semester, quarter or 12 months of
post-secondary education for the Participant or
the Participant's spouse, children or
"dependents" (as defined in Section 152 of the
Code);
[D] payments necessary to prevent the eviction of the
Participant from his principal residence or
foreclosure on the mortgage on that residence;
and
[E] any other financial need that the Commissioner of
Internal Revenue, through the publication of
revenue rulings, notices and other documents of
general applicability, may from time to time
designate as a deemed immediate and heavy
financial need as provided in Treasury Regulation
Section 1.401(k)-1(d)(2)(ii)(iv).
[3] A distribution is "necessary to satisfy the immediate
and heavy financial need" if:
[A] the distribution is not in excess of the amount
of the immediate and heavy financial need of the
Participant; provided, however, that the amount
of an immediate and heavy financial need may
include any amounts necessary to pay federal,
state or local income taxes or penalties
reasonably anticipated to result from the
distribution; and
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[B] the Participant has obtained all distributions,
other than hardship distributions, and all
nontaxable (at the time of the loan) loans
currently available under this Plan and all other
plans maintained by the Company or a Related
Corporation.
[4] In the event a Participant receives a hardship
withdrawal hereunder, he must suspend making Pre-Tax
Contributions under the Plan (and under all other plans
maintained by the Company or a Related Corporation) for
the 12-month period commencing as of the date of such
hardship withdrawal. Furthermore, after becoming
eligible to recommence making Pre-Tax Contributions
(i.e., following expiration of the above 12-month
period), the maximum amount of Pre-Tax Contributions the
Participant may contribute under the Plan (and all other
plans maintained by the Company or a Related
Corporation) may not, for the taxable year immediately
following the taxable year in which the hardship
withdrawal was made pursuant to this Section 7.8, exceed
$7,000 (as adjusted for cost-of-living by the Secretary
of the Treasury pursuant to Section 402(g)(5) of the
Code) reduced by the Pre-Tax Contributions made by the
Participant under the Plan (and all other plans
maintained by the Company or a Related Corporation)
during the taxable year in which the hardship withdrawal
was made.
[c] Form of Payment: Any amount withdrawn under this Section 7.8
will be paid in a single sum.
[d] Order of Asset Conversion: The Plan Administrator will convert
assets to obtain withdrawal proceeds in a uniform order which
may change from time to time. Participants shall be given
notice of such order and of any changes.
[e] Qualified Domestic Relations Order. In the event a domestic
relations order is determined to be a "qualified domestic
relations order" (as defined in Section 414(p) of the Code),
any and all benefits assigned to an "alternate payee" (as
defined in Section 414(p) of the Code) under such qualified
domestic relations order shall be available for distribution to
such alternate payee as soon as administratively feasible after
the date specified in the qualified domestic relations order.
7.9 PARTICIPANT LOANS:
[a] Administration: The Plan Administrator or its designee shall
be responsible for administration of the loan program.
[b] Eligibility: A Participant who is an Employee may borrow from
his Account in the Plan. Except in the case of parties-in-
interest, only active Employees are eligible to apply for a
loan from the Plan.
[c] Conditions of Loan: Any loan from the Plan will be subject to
the following conditions:
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[1] The loan will be in the form of cash and the
Participant's Account will serve as the sole collateral
for the loan.
[2] The loan may not exceed the lesser of 50 percent of the
market value of the Participant's Account at the time
the Participant's written loan request is received by
the Plan Administrator or $50,000 reduced by the excess
(if any) of the highest balance of loans outstanding
during the one-year period ending on the date the new
loan is made over the balance of loans outstanding on
the date the new loan is made.
[3] The minimum loan will be $1,000.
[4] The term of a loan will be not less than six months and
not more than five-years (ten years in the case of a
loan used to acquire a dwelling which will, within a
reasonable time, be used as the Participant's principle
residence); provided, however, that the repayment term
of the loan shall be in increments of six months.
[5] The Participant must execute and deliver to the Plan
Administrator a payroll deduction authorization in a
form satisfactory to the Plan Administrator for the term
of the loan repayment.
[6] The Participant must execute and deliver to the Plan
Administrator a promissory note in a form satisfactory
to the Plan Administrator.
[7] One new loan will be allowed each Plan Year, but no more
than one outstanding loan will be permitted at any time.
[8] The loan will be treated as an asset of the
Participant's Account.
[9] Except in the case of parties-in-interest, only active
Employees, excluding those Employees who are receiving
long-term disability benefits or who are on a leave of
absence from the Company, are eligible to apply for a
loan from the Plan.
[10] The limits of this Section 7.9 [c] will apply to all
loans made to the Participant under all plans maintained
by the Company or any Related Corporation.
[d] Employee Direction for Loan Proceeds and Valuation of Accounts:
[1] Employee Direction: A Participant shall execute a
written directive to the Plan Administrator setting
forth the amount of the loan requested on a form
prescribed by the Plan Administrator for such purpose.
[2] Valuation of Account: The valuation of an Account, or
the sale or redemption of securities credited to an
Account, or both, will be made on the date or dates
selected by the Plan Administrator, and within a
reasonable time after receipt by the Plan Administrator
of a written application for a loan.
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[3] Order of Subaccount and Asset Conversion: The Plan
Administrator will convert assets in a Participant's
subaccounts on a pro rata basis to obtain the loan
proceeds in the following order: Unmatched After-Tax
Subaccount, Matched After-Tax Subaccount, Rollover
Subaccount, Transfer Subaccount, Unmatched Pre-Tax
Subaccount, Matched Pre-Tax Subaccount and Company
Contributions Subaccount.
[e] Interest on Loan: Interest charged on loans will be a
commercially reasonable rate published for the first business
day of the month immediately preceding the month in which a
written directive for a loan is received by the Plan
Administrator.
[f] Allocation of Loan Payments: Loan payments, which must be made
at least quarterly, will be credited to a Participant's
subaccounts in the reverse order from which such subaccounts
provided the loan proceeds.
[g] Prepayment of Loan:
[1] Prepayment Prior to Termination of Employment: At any
time during a 12-month period and prior to a
Participant's Termination of Employment, a Participant
may make a single sum prepayment of all of an
outstanding loan balance.
[2] Prepayment on Termination of Employment: If a loan is
not prepaid prior to a Participant's Termination of
Employment, the outstanding balance will constitute a
distribution upon such Participant's Termination of
Employment. If a loan is not prepaid prior to a
Participant's Termination of Employment and the
Participant is a "party-in-interest" (as defined in
Section 3(14) of ERISA), the outstanding balance will be
paid in monthly installments as described in subsection
[h] below. Participants who do not experience a
Termination of Employment but who are in an ineligible
class of employees will continue to pay the outstanding
loan balance in monthly installments.
[h] Loans to Terminated Employees: Terminated employees who are
parties-in-interest and who do not request a distribution of
their Accounts will be permitted to continue to make payments
on pre-existing loans if said terminated employees meet the
criteria for the continuance of such loans established by the
Plan Administrator. Deferred vested employees who are parties
in interest shall be permitted to obtain a loan from the Plan
if said individuals meet the criteria established by the Plan
Administrator.
[i] Loan Default: Any loan to an active employee will be treated
as being in default if a scheduled monthly payment is not made
within 90 days of the payment due date. Any loan to a
terminated employee who is a party-in-interest will be treated
as being in default if a scheduled monthly payment is not made
within 30 days of the payment due date. A loan which is in
default will be treated as a distribution.
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ARTICLE VIII
FIDUCIARY OBLIGATIONS
8.1 GENERAL FIDUCIARY DUTIES: A fiduciary must discharge his duties under
the Plan solely in the interest of Participants and Beneficiaries and for the
exclusive purpose of providing benefits to Participants and their Beneficiaries
and defraying reasonable expenses of administering the Plan. All fiduciaries
must act with the care, skill, prudence and diligence under the circumstances
then prevailing that a prudent man acting in a like capacity and familiar with
such matters would use in the conduct of an enterprise of a like character and
with like aims. Except as authorized by regulations of the Secretary of Labor,
no fiduciary may maintain the indicia of ownership of any assets of the Plan
outside the jurisdiction of the district courts of the United States. A
fiduciary must act in accordance with the documents and instruments governing
the Plan to the extent the documents and instruments are consistent with the
requirements of law.
8.2 ALLOCATION OF FIDUCIARY RESPONSIBILITY: A named fiduciary may
designate persons other than named fiduciaries to carry out fiduciary
responsibilities under the Plan; provided, however, that fiduciary
responsibilities to manage or control Plan assets may not be delegated except
by appointment of an investment manager. Named fiduciaries are the Company and
the Plan Administrator.
8.3 COMPENSATION AND EXPENSES OF FIDUCIARIES:
[a] General Rules: A fiduciary is entitled to reasonable
compensation for services rendered and to reimbursement for
expenses properly and actually incurred in the performance of
his duties under the Plan. However, a fiduciary who already
receives full-time pay from the Company may receive no
compensation from the Plan, except for the reimbursement of
expenses properly and actually incurred. All compensation and
expenses will be paid by the Plan, unless the Company elects to
pay all or any part of the compensation and expenses.
[b] Compensation of Trustee: The Trustee is entitled to such
reasonable compensation for its services as the Company and the
Trustee mutually shall determine.
[c] Compensation of Persons Retained or Employed by Named
Fiduciary: The compensation of all agents, counsel or other
persons retained or employed by a named fiduciary will be
determined by the named fiduciary employing such person.
ARTICLE IX
PLAN ADMINISTRATOR
9.1 APPOINTMENT OF PLAN ADMINISTRATOR: The Board of Directors will appoint
a Plan Administrator who will hold office until resignation, death or removal
by the Board of Directors. If the Board of Directors fails to appoint a Plan
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Administrator, the Company will be the Plan Administrator. Any person may
serve in more than one fiduciary capacity. Any group of persons may serve in
the capacity of Plan Administrator. A Plan Administrator may resign at any
time by giving written notice to the Board of Directors. At any time a Plan
Administrator may be removed by the Board of Directors with or without cause.
As soon as practicable following the death, resignation or removal of any Plan
Administrator, the Board of Directors will appoint a successor. Written notice
of appointment of a successor Plan Administrator will be given by the Board of
Directors to the Trustee. Until receipt by the Trustee of written notice, the
Trustee will not be charged with knowledge or notice of the change.
9.2 INFORMATION TO BE MADE AVAILABLE TO PLAN ADMINISTRATOR: To enable the
Plan Administrator to perform all of its duties under the Plan, the Board of
Directors will provide the Plan Administrator with access to any information
the Plan Administrator requires. If required information is not available from
the Company's records, the Plan Administrator may obtain the information from
the Participants. The Plan Administrator and the Company may rely on and will
not be liable for any information that an Employee provides either directly or
indirectly.
9.3 DUTIES AND POWERS OF PLAN ADMINISTRATOR:
[a] General: The Plan Administrator shall have all the powers and
authority as may be necessary to carry out the provisions of
the Plan, including the discretionary power and authority to
interpret and construe the Plan and to resolve any disputes
arising thereunder, and the powers and authority expressly
conferred upon it herein. Without limiting the generality of
the foregoing, the Plan Administrator will decide all questions
arising in the administration, interpretation and application
of the Plan, including all questions relating to eligibility
and distributions, except as may be reserved under this Plan to
the Company. The decisions of the Plan Administrator will be
final. The Plan Administrator will direct the Trustee
concerning payments to be made out of Plan assets. All
notices, directions, information and other communications to
and from the Plan Administrator will be in writing.
[b] Employment of Advisers and Persons to Carry Out
Responsibilities: The Plan Administrator may employ one or more
persons to render advice with regard to any responsibility the
Plan Administrator has under the Plan and may employ one or
more persons (including the Trustee) to carry out any of its
responsibilities under the Plan.
[c] Reporting and Disclosure: The Plan Administrator will be
responsible for all applicable reporting and disclosure
requirements of law. In connection therewith, the Plan
Administrator will prepare, file with the Department of Labor
or Internal Revenue Service, and furnish to Plan Participants
and Beneficiaries, when applicable, the following:
[1] summary plan descriptions;
[2] descriptions of modifications and changes;
[3] annual reports;
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[4] terminal and supplementary reports;
[5] registration statements; and
[6] any other returns, reports or documents required by law.
[d] Inspection of Documents: The Plan Administrator shall make
available for inspection copies of the Plan, the latest annual
report and agreements under which the Plan was established or
is operated. The documents will be available for examination
by any Participant or Beneficiary in the principal office of
the Plan Administrator and in any other places necessary to
make available all pertinent information to Participants and
Beneficiaries. On written request by any Participant or
Beneficiary, the Plan Administrator shall furnish a copy of the
latest updated summary plan description, the latest annual
report, any termination report and any agreements under which
the Plan is established or operated.
[e] Keeping of Records: The Plan Administrator will keep any
records that are necessary or advisable in its judgment for the
administration of this Plan.
[f] Bonding of Fiduciaries and Plan Officials: The Plan
Administrator shall procure bonds for every fiduciary of the
Plan and for every person who handles funds or other property
of the Plan that is not exempt from the bonding requirements.
Bonds must conform to the requirements of law and will be in an
amount of not less than $1,000 or, if greater, ten percent of
the amount of funds handled, with a generally applicable
maximum of $500,000.
9.4 NOTICES FROM PARTICIPANTS: Whenever provision is made in the Plan that
a Participant may exercise an option or election or designate a Beneficiary,
the action of the Participant will be evidenced in writing on forms provided by
the Plan Administrator for such purpose, which forms shall be signed by the
Participant and delivered to the Plan Administrator in person or by mail.
Written notice will not be effective until received by the Plan Administrator.
9.5 CLAIMS PROCEDURES:
[a] Filing and Initial Determination of Claim: Any Participant or
Beneficiary (the "claimant") or his duly authorized
representative may file a claim for a Plan benefit to which the
claimant believes he is entitled. A claim must be in writing
and delivered to the Plan Administrator in person or by
certified mail, postage prepaid. Within 90 days after receipt
of a claim, the Plan Administrator will send the claimant by
certified mail, postage prepaid, notice of the granting or
denying, in whole or in part, of the claim, unless special
circumstances require an extension of time for processing the
claim; provided, however, that in no event may the extension
exceed 90 days from the end of the initial 90-day period. If
an extension of time is necessary, the claimant will receive a
written notice prior to the expiration of the initial 90-day
period regarding the need for an extension of time. The Plan
Administrator has full discretion to deny or grant a claim in
whole or in part. If notice
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of the denial of a claim is not furnished in accordance with
this subsection [a], the claim will be deemed denied and the
claimant will be permitted to exercise his right of review
pursuant to subsections [c] and [d] below.
[b] Duty of Plan Administrator Upon Denial of Claim: The Plan
Administrator will provide a claimant who is denied a claim for
benefits with a written notice setting forth, in a manner
calculated to be understood by the claimant:
[1] the specific reason or reasons for the denial;
[2] specific references to pertinent Plan provisions upon
which the denial is based;
[3] a description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why the material is necessary; and
[4] an explanation of the Plan's claims' review procedure.
[c] Review of Claim Denial: Within 60 days after claimant's receipt
of written notice of a denial in whole or in part of his claim,
the claimant or his duly authorized representative, by written
application to the Plan Administrator in person or by certified
mail, postage prepaid, may request a review of the denial,
review pertinent documents and submit issues and comments to
the Plan Administrator in writing. On receipt of a request for
review, the Plan Administrator will render a decision, which
decision will be written in a manner calculated to be
understood by the claimant and will include reasons for the
decision and specific references to pertinent Plan provisions
upon which the decision is based. The decision on review will
be made no later than 60 days after the Plan Administrator's
receipt of a request for review, unless special circumstances
require an extension of time for processing, in which case a
decision will be rendered no later than 120 days after receipt
of a request for review. If an extension of time is necessary,
the claimant will be given written notice of the extension
prior to expiration of the 60-day period. If notice of the
decision on the review is not furnished under this subsection
[c], the claim will be deemed denied.
ARTICLE X
TRUST FUND
10.1 TRUST FUND: The assets of the Plan shall be held in trust under the
terms of the Trust Agreement between the Company and the Trustee, which Trust
Agreement may be a trust established by the Company or a Related Corporation
for the purpose of investing the assets of other plans qualified under Section
401(a) of the Code that are maintained by the Company or a Related Corporation;
provided, however, that such trust is adopted as a part of this Plan; and,
provided further, that the Trustee shall maintain separate accounting records
to reflect the share of the Trust Fund that is to be credited to this Plan.
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10.2 INVESTMENT OF TRUST FUND:
[a] General: The assets of the Plan shall be invested in accordance
with the terms of the Plan and the Trust Agreement under which
the assets are held.
[b] Options, Rights and Warrants: In the event that any options,
rights or warrants are granted or issued with respect to stock
other than Cliffs Stock held by the Trustee for a Participant,
the Trustee shall be directed to sell such options, rights or
warrants if there is a market for them. The net cash proceeds
from the sale will be credited ratably to the Account of each
Participant concerned. If the Trustee receives stock as a
dividend or as the result of a stock split, the shares
allocable to securities held in a Participant's Account will be
added to his Account on a full or fractional share basis.
[c] Voting: Cliffs Stock held by the Trustee for Participants and
Beneficiaries with respect to which the Trustee receives
written instructions from such Participants and Beneficiaries
shall (i) be voted by the Trustee as directed by the
Participant or Beneficiary, or (ii) not be voted by the Trustee
if so directed by any Participant or Beneficiary. With respect
to any Cliffs Stock allocated to a Participant's Account, at
the time of a mailing to stockholders of the notice of any
stockholders' meeting of Cleveland-Cliffs Inc, Cleveland-Cliffs
Inc, in conjunction with the Trustee, shall use its reasonable
best efforts to cause to be delivered to each Participant and
Beneficiary such notices and informational statements as are
furnished to Cleveland- Cliffs Inc stockholders in respect of
the exercise of voting rights, together with forms upon which
the Participant or Beneficiary may confidentially instruct the
Trustee, or revoke such instruction, with respect to the voting
of shares of each class or series of Cliffs Stock allocated to
his account. Upon timely receipt of directions, the Trustee
shall vote each class or series of Cliffs Stock (with voting
rights) allocated to a Participant's or Beneficiary's Account
as directed by the Participant or Beneficiary. The Trustee
shall vote or not vote each class or series of Cliffs Stock
(with voting rights) that is not allocated to a Participant's
or Beneficiary's Account and each class or series of Cliffs
Stock (with voting rights) allocated to a Participant's or
Beneficiary's Account which is not voted by the Participant or
Beneficiary because the Participant or Beneficiary has not
directed (or has not timely directed) the Trustee as to the
manner in which such Cliffs Stock is to be voted, in the same
proportion as those shares of the same class or series of
Cliffs Stock for which the Trustee has received proper
direction on such matter.
[d] Tender Offers for Cliffs Stock: Notwithstanding any other
provision of the Plan to the contrary, if there is a tender
offer for, or a request or invitation for tenders of, shares of
a class or series of Cliffs Stock or other securities of the
Company (or any Related Corporation) held by the Trustee for
Participants or Beneficiaries (i) the Plan Administrator shall
furnish to the Trustee, who shall then furnish to each
Participant or Beneficiary, prompt notice of such tender offer
for, or request or invitation for tenders of, such
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shares or series of Cliffs Stock or other securities of the
Company (or any Related Corporation), and (ii) the Trustee
shall request from each Participant or Beneficiary instructions
as to the tendering of each class or series of such shares of
Cliffs Stock or other securities of the Company (or any Related
Corporation) allocated to the Participant's or Beneficiary's
Account. The Trustee shall tender only such shares of each
class or series of Cliffs Stock or other securities of the
Company (or any Related Corporation) for which the Trustee has
received (within the time specified in the notification) tender
instructions. With respect to shares of the class or series of
Cliffs Stock or other securities of the Company (or any Related
Corporation) which are not allocated to a Participant's or
Beneficiary's Account, the Trustee shall tender such shares or
series of Cliffs Stock or other securities of the Company (or
any Related Corporation) in the same proportion as the number
of such shares or series of Cliffs Stock or other securities of
the Company (or any Related Corporation) for which instructions
to tender are received bears to the total number of such shares
or series of Cliffs Stock or other securities of the Company
(or any Related Corporation) for which instructions from
Participants or Beneficiaries could have been received. The
Trustee shall not tender all other shares or series of Cliffs
Stock or other securities of the Company (or any Related
Corporation).
[e] Confidentiality: All instructions received by the Trustee from
Participants or Beneficiaries pursuant to subsections [c] or
[d] above shall be held by the Trustee in strict confidence and
shall not be divulged to any person, including employees,
officers and directors of the Company (or any Related
Corporation); provided, however, that to the extent necessary
for the operation of the Plan, such instructions may be relayed
by the Trustee to a recordkeeper, auditor or other person
providing services to the Plan if such person (i) is not the
Company (or any Related Corporation) or any employee, officer
or director thereof, and (ii) agrees not to divulge such
directions to any other person, including employees, officers
and directors of the Company (or any Related Corporation).
ARTICLE XI
CONTINUANCE, TERMINATION AND
AMENDMENT OF PLAN
11.1 TERMINATION OF PLAN: Continuation of the Plan is not assumed as a
contractual obligation by the Company, and the right is reserved to the
Company, by action of the Board of Directors, to terminate this Plan and/or
Trust in whole or in part at any time. Upon termination of the Plan, the Board
of Directors shall have discretion to liquidate the Plan or continue a frozen
plan making distributions as provided in Article VII. Termination of the Plan
will in no event have the effect of revesting any part of the Trust Fund in the
Company. Notice of termination will be given to the Trustee in the form of an
instrument in writing executed by the Company pursuant to an action of its
Board of Directors, together with a certified copy of the resolution of its
Board of Directors to that effect. Termination of the Plan will take effect as
of the
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date specified by the Board of Directors. The Plan created by execution of
this agreement will be terminated automatically in the event of the
dissolution, consolidation or merger of the Company, or the sale by the Company
of substantially all of its assets, if the resulting successor corporation or
business entity does not continue the Plan. The Plan Administrator will file
any termination reports required by law.
11.2 MERGER, CONSOLIDATION OR TRANSFER OF ASSETS OR LIABILITIES OF THE
PLAN: The Board of Directors may merge or consolidate this Plan with any other
plan may transfer the assets or liabilities of this Plan to any other plan or
transfer the assets and liabilities of another plan to this Plan if each
Participant in the Plan (if the Plan then terminated) would receive a benefit
immediately after the merger, consolidation or transfer that is equal to or
greater than the benefit he would have been entitled to receive immediately
before the merger, consolidation or transfer (if the Plan had then terminated).
If any merger, consolidation or transfer of assets or liabilities occurs, the
Plan Administrator will file any reports required by law.
11.3 AMENDMENTS TO PLAN: The Board of Directors may amend this Plan at any
time; provided, however, that no amendment may cause the Trust Fund to be
diverted to purposes other than for the exclusive benefit of Participants and
their Beneficiaries. To the extent authorized by the Board of Directors, the
Plan may be amended at any time and from time to time. No amendment may
decrease the vested interest of any Participant. If an amended vesting
schedule is adopted, any Participant who has three or more years of service at
the later of the date the amendment is adopted or becomes effective may elect
to remain under the Plan's prior vesting schedule. Notwithstanding the
preceding sentence, no election need be provided for any Participant where the
nonforfeitable percentage under the Plan as amended cannot be less than the
percentage determined without regard to the amendment. The election must be
made in writing, in such form and within such period of time prescribed by the
Plan Administrator, in accordance with applicable regulations, and must be
timely filed with the Plan Administrator. No amendment may discriminate in
favor of Employees who are officers, shareholders or Highly Compensated
Employees. Notwithstanding anything in this Plan to the contrary, the Plan may
be amended at any time to conform to the provisions and requirements of federal
and state laws or regulations or rulings issued pursuant to such federal and
state laws. No such amendment will be considered prejudicial to the interest
of any Participant or Beneficiary under this Plan.
11.4 PARTICIPATING COMPANIES:
[a] Requirements for Participation: Any Affiliated Company may
participate in the Plan as a participating Company, provided
its participation is approved by the Board of Directors and it
executes an instrument of participation. The instrument of
participation may contain terms and conditions approved by the
Board of Directors and applicable only to the participating
Company, and, to the extent qualification of the Plan is not
affected thereby, will constitute an amendment of the Plan as
it applies to the participating Company. To the extent there
are no differences in Plan terms and conditions between the
Plan as established and maintained by the Company and the Plan
as adopted and maintained by a participating Company, such
participating Company may indicate its participation in the
Plan by executing the Plan document and any amendments thereto,
which
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documents and amendments (if any) shall constitute an
instrument of participation hereunder.
[b] Employee Transfers Within the Participating Group: A transfer
of employment from one participating Company to another
participating Company will not be considered a Termination of
Employment and the Account of the Participant whose employment
is so transferred will be transferred to the group of Accounts
of the transferee participating Company. A transferee
participating Company will continue any funding of the Plan for
any Employee it acquires by transfer and credit the prior years
of service of the transferred Participant.
[c] Withdrawal by Participating Company: Any participating Company,
by action of its board of directors, may withdraw from
participation in the Plan upon written notice to the Plan
Administrator and the Trustee, and may (i) treat the withdrawal
as a termination of the Plan with respect to its Employees;
(ii) treat the withdrawal as an amendment of the Plan and
direct the Trustee to segregate and transfer to a separate
trust and qualified plan the Accounts of Participants and
Beneficiaries allocable to the participating Company; or (iii)
treat the withdrawal as an amendment of the Plan and direct the
Trustee to segregate and transfer the Accounts of Participants
and Beneficiaries allocable to the Participating Company to
another qualified plan in which the participating Company may
participate; provided, however, that the value of the Account
of any Participant immediately after the transfer will equal
the value of his Account immediately before the transfer.
[d] Contributions made on Behalf of Participating Company: In the
event a participating Company is unable to make all or a
portion of its Company Contribution by reason of not having
sufficient current or accumulated profits to make such Company
Contributions for a year in which a consolidated federal income
tax return of the affiliated group is filed, another
participating Company in the affiliated group, to the extent it
has sufficient current or accumulated profits, may in its
discretion make, on behalf of the participating Company, the
portion of the Company Contributions the participating Company
is otherwise prevented from making for the Plan Year.
ARTICLE XII
MISCELLANEOUS
12.1 BENEFITS TO BE PROVIDED SOLELY FROM THE TRUST FUND: All benefits
payable under this Plan will be or provided solely from the Trust Fund, and the
Company assumes no liability or responsibility for payment of benefits.
12.2 TEXT TO CONTROL: The headings of Articles, Sections, subsections and
clauses are included solely for convenience of reference. If any conflict
between any heading and the text of this Plan exists, the text will control.
12.3 SEVERABILITY: If any provision of this Plan is illegal and invalid for
any reason, the illegality or invalidity will not affect the remaining
provisions.
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On the contrary, the remaining provisions will be fully severable, and this
Plan will be construed and enforced as if the illegal or invalid provisions
never had been inserted in the document.
12.4 JURISDICTION: This Plan will be construed and administered under the
laws of the state of Delaware when the laws of that jurisdiction are not in
conflict with federal law.
12.5 PLAN FOR EXCLUSIVE BENEFIT OF PARTICIPANTS; REVERSION PROHIBITED: This
Plan has been established for the exclusive benefit of Participants and their
Beneficiaries. Under no circumstances may any funds contributed to or held by
the Trustee at any time revert to or be used for or enjoyed by the Company
except to the extent permitted by law.
12.6 GENDER AND NUMBER: The masculine gender will be deemed to include the
feminine gender, and the singular will be deemed to include the plural.
ARTICLE XIII
TOP HEAVY PROVISIONS
Notwithstanding any other provision of the Plan to the contrary, in
the event the Plan is deemed to be a "Top Heavy Plan" (as defined in Section
13.1[i]) for any Plan Year, the provisions contained in Section 13.4 with
respect to Company Contributions shall be applicable with respect to such Plan
Year.
13.1 DEFINITIONS: For purposes of this Article XIII, the following
definitions shall apply:
[a] "Determination Date" means, with respect to any Plan Year, the
last day of the preceding Plan Year, except that for the first
Plan Year the "Determination Date" shall be the last day of
such first Plan Year.
[b] "Key Employee" means an Employee or former Employee who, at any
time during the current Plan Year or any of the four preceding
Plan Years, is a key employee pursuant to the provisions of
Section 416(i)(1) of the Code, and any Beneficiary of such an
Employee or former Employee.
[c] "Non-Key Employee" means an Employee or former Employee who is
not a Key Employee, and his Beneficiary in the event of his
death.
[d] "Permissive Aggregation Group" means the group of tax-qualified
plans of the Company or a Related Corporation consisting of:
[1] the plans in the Required Aggregation Group; plus
[2] one or more plans designated from time to time by the
Plan Administrator that are not part of the Required
Aggregation Group but that satisfy the requirements of
Sections 401(a)(4) and 410 of the Code when considered
with the Required Aggregation Group.
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[e] "Required Aggregation Group" means the group of tax-qualified
plans of the Company or a Related Corporation consisting of:
[1] each plan in which a Key Employee participates; and
[2] each other plan which enables a plan in which a Key
Employee participates to meet the requirements of
Sections 401(a)(4) and 410 of the Code, including any
such plan that has been terminated if it was maintained
during the five-year period ending on the Determination
Date and would, but for the fact that it terminated, be
part of a Required Aggregation Group.
[f] "Super Top Heavy Group" means, with respect to a particular
Plan Year, a Required or Permissive Aggregation Group that, as
of the Determination Date, would qualify as a Top Heavy Group
under the definition in subsection [h] below with "90 percent"
substituted for "60 percent" each place where "60 percent"
appears in such definition.
[g] "Super Top Heavy Plan" means, with respect to a particular Plan
Year, a plan that, as of the Determination Date, would qualify
as a Top Heavy Plan under the definition in subsection [i]
below with "90 percent" substituted for "60 percent" each place
where "60 percent" appears in such definition. A plan shall
also be a "Super Top Heavy Plan" if it is part of a Super Top
Heavy Group.
[h] "Top Heavy Group" means, with respect to a particular Plan
Year, a Required or Permissive Aggregation Group if the sum, as
of the Determination Date, of the present value of the
cumulative accrued benefits for Key Employees under all defined
benefit plans included in such Group and the aggregate of the
account balances of Key Employees under all defined
contribution plans included in such Group exceeds 60 percent of
a similar sum determined for all employees covered by the plans
included in such Group.
[i] "Top Heavy Plan" means, with respect to a particular Plan Year,
(i) in the case of a defined contribution plan (including any
simplified employee pension plan), a plan for which, as of the
Determination Date, the aggregate of the accounts (within the
meaning of Section 416(g) of the Code and the regulations and
rulings promulgated thereunder) of Key Employees exceeds 60
percent of the aggregate of the accounts of all participants
under the plan, with accounts valued as of the relevant
"Valuation Date" (as defined in subsection [j] below), (ii) in
the case of a defined benefit plan, a plan for which, as of the
Determination Date, the present value of the cumulative accrued
benefits payable under the plan (within the meaning of Section
416(g) of the Code and regulations and rulings promulgated
thereunder) to Key Employees exceeds 60 percent of the present
value of the cumulative accrued benefits under the plan for all
employees, with the present value of cumulative accrued
benefits to be determined under the accrual method uniformly
used under all plans maintained by the Company or a Related
Corporation or, if no such method exists, under the slowest
accrual method permitted under the fractional accrual rate of
Section 411(b)(1)(C) of the Code, and (iii) any plan (including
any simplified employee pension plan)
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included in a Required Aggregation Group that is a Top Heavy
Group. For purposes of this subsection [i], the accounts and
accrued benefits of any employee who has not performed services
for the Company or a Related Corporation during the five-year
period ending on the Determination Date shall be disregarded.
Furthermore, the present value of cumulative accrued benefits
under a defined benefit plan for purposes of top heavy
determinations shall be calculated using the actuarial
assumptions otherwise employed under such plan, except that the
same actuarial assumptions shall be used for all plans within a
Required or Permissive Aggregation Group. A Participant's
interest in the Plan attributable to any Rollover Contributions,
except Rollover Contributions made from a plan maintained by
the Company or a Related Corporation, shall not be considered
in determining whether a plan is top heavy. Notwithstanding the
foregoing, if a plan is included in a Required or Permissive
Aggregation Group that is not a Top Heavy Group, such plan
shall not be a Top Heavy Plan.
[j] "Valuation Date" means, with respect to a Determination Date
and for purposes of this Article XIII only, (i) in the case of
a defined benefit plan, the most recent date for computing plan
costs for minimum funding purposes, and (ii) in the case of a
defined contribution plan, the most recent date on which plan
assets are valued for purposes of determining the value of
account balances.
13.2 COMPENSATION AND LIMITATION THEREON: For purposes of this Article
XIII, "compensation" shall mean "compensation" as defined in Section 4.5;
provided, however, that for any Plan Year that the Plan is a Top Heavy Plan,
the compensation taken into account under the Plan for any Participant shall
not exceed $150,000 (subject to adjustment for cost-of-living annually by the
Secretary of the Treasury as provided in Sections 401(a)(17)(B) and 416(d)(2)
of the Code).
13.3 VESTING REQUIREMENTS: In any Plan Year that the Plan is a Top Heavy
Plan, each Participant's entire interest in his Account shall be fully vested
and nonforfeitable. In the event the Plan ceases to be a Top Heavy Plan for
any Plan Year subsequent to a Plan Year in which the Plan was a Top Heavy Plan,
the Participant's interest in his Account that has become fully vested in
accordance with the preceding sentence shall remain fully vested.
13.4 MINIMUM ALLOCATION: Each Participant who, on the last day of a Plan
Year in which the Plan is a Top Heavy Plan, (i) is a Non-Key Employee and (ii)
does not participate in a defined benefit plan that is part of a Required
Aggregation Group, shall receive a minimum allocation of Company Matching
Contributions for such Plan Year equal to a certain percentage (as hereinafter
set forth) of his compensation received during such Plan Year. Such percentage
shall be equal to the lesser of three percent or the highest percentage at
which Company Matching Contributions are allocated to the Account of any Key
Employee for such Plan Year (when expressed as a percentage of such Key
Employee's compensation for the Plan Year). To the extent necessary to provide
this minimum allocation, the allocation of Company Matching Contributions to
Accounts of Key Employees shall be reduced proportionately. Notwithstanding
the foregoing, an individual who, on the last day of any Plan Year during which
the Plan is a Top Heavy Plan, is a participant in both a defined benefit plan
and a defined contribution plan maintained by the Company or a Related
Corporation shall receive the minimum
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allocation referred to above, except that "seven and one-half percent" shall be
substituted for "three percent"; provided, however, that (i) if such individual
receives a minimum benefit with respect to such Plan Year under a defined
benefit plan maintained by the Company or a Related Corporation, such
individual shall not receive a minimum benefit under this Plan; and (ii) if the
Plan is a Super Top Heavy Plan, the limitation in Section 415(e) of the Code
shall be applied by substituting "1.0" for "1.25", and the minimum allocation
referred to in this Section 13.4 shall be applied by substituting "five
percent" for "seven and one-half percent".
ARTICLE XIV
SPECIAL PROVISIONS REGARDING ACQUISITION EMPLOYEES
14.1 GENERAL: This Article XIV contains special provisions regarding
employees of Northshore Mining Company (formerly Cyprus Northshore Mining
Corporation) and employees of Silver Bay Power Company (formerly Cyprus Silver
Bay Power Corporation) on the day preceding the Effective Date (hereinafter,
"Acquisition Employees") who were also participants in the Cyprus Amax Minerals
Company Savings Plan & Trust (the "Cyprus Savings Plan") on the day preceding
the Effective Date.
14.2 EMPLOYMENT: For all purposes of the Plan, the acquisition of
Northshore Mining Company and Silver Bay Power Company pursuant to the Stock
Purchase Agreement by and between Cleveland-Cliffs Inc and Cliffs Minnesota
Minerals Company and Cyprus Amax Minerals Company, as amended the ("Stock
Purchase Agreement") shall not be deemed a Termination of Employment, an
employment commencement date, a reemployment commencement date or otherwise a
break in employment or service with respect to Acquisition Employees.
14.3 TRANSFER OF ASSETS AND LIABILITIES: Effective as of the Effective Date
(the "Transfer Date"), all liabilities of the Cyprus Savings Plan with respect
to Acquisition Employees shall be transferred to the Plan from the Cyprus
Savings Plan; provided, however, that on or as soon as practicable after the
Transfer Date, assets of the Cyprus Savings Plan attributable to such
Acquisition Employees' liabilities so transferred shall be transferred from the
Cyprus Savings Plan to the Plan in an amount equal to the accounts of such
Acquisition Employees under the Cyprus Savings Plan on the "Closing Date" (as
"Closing Date" is defined in the Stock Purchase Agreement), which accounts
shall be adjusted for gains and losses for the period commencing on the day
following the Closing Date and ending on the day assets are actually
transferred from the Cyprus Savings Plan to the Plan. Anything contained
herein to the contrary notwithstanding, liabilities of the Cyprus Savings Plan
with respect to Acquisition Employees that are not transferred to the Plan on
the Transfer Date (if any) shall be transferred to the Plan as soon thereafter
as administratively possible (the "Second Transfer Date"). The amount of
assets of the Cyprus Savings Plan attributable to Acquisition Employees'
liabilities so transferred on the Second Transfer Date shall be determined and
transferred as hereinbefore set forth in this Section 14.3. To the extent
possible, assets transferred from the Cyprus Savings Plan to the Plan shall be
transferred in kind. Any applications, elections and waivers under the Cyprus
Savings Plan applicable to assets transferred from the Cyprus Savings Plan to
the Plan shall continue to be applicable hereunder, unless the Acquisition
Employee revises such application,
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election or waiver. Assets transferred to the Plan from the Cyprus Savings
Plan pursuant to the provisions of this Section 14.3 shall become assets of the
Plan to be held by the Trustee in the Trust Fund.
14.4 CONTINUATION OF PORTION OF CYPRUS SAVINGS PLAN: The Plan shall be deemed a
continuation of the portion of the Cyprus Savings Plan transferred to the Plan
with respect to Acquisition Employees; provided, however, that the Plan shall
only be deemed a continuation of the aspects of the Cyprus Savings Plan
governed by Sections 401(a), 401(k) and 401(m) of the Code.
* * *
Executed this 3rd day of October, 1994.
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NORTHSHORE MINING COMPANY
By: /s/ Cynthia B. Bezik
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Title Treasurer
And: /s/ J. E. Lenhard
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Title Secretary
SILVER BAY POWER COMPANY
By: /s/ Cynthia B. Bezik
----------------------------------
Title Treasurer
And: /s/ J. E. Lenhard
----------------------------------
Title Secretary
HR456
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46
EXHIBIT "A"
NORTHSHORE MINING COMPANY AND SILVER BAY POWER COMPANY
RETIREMENT SAVINGS PLAN
The following companies are participating Companies under the Plan:
Northshore Mining Company
Silver Bay Power Company