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Exhibit 10(lxxiv)
NACCO MATERIALS HANDLING GROUP, INC.
UNFUNDED BENEFIT PLAN
NACCO Materials Handling Group, Inc. (the "Company") does hereby
amend and completely restate the NACCO Materials Handling Group, Inc. Unfunded
Benefit Plan on the terms and conditions described hereinafter, effective
January 1, 1999:
ARTICLE I
PREFACE
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SECTION 1.1. EFFECTIVE DATE. The original effective date of this
Plan was February 10, 1993. The effective date of this amendment and restatement
is January 1, 1999.
SECTION 1.2. PURPOSE OF THE PLAN. The purpose of this Plan is to
(a) allow certain employees to defer the receipt of certain long-term incentive
compensation award payments and (b) provide for certain Employees the benefits
they would have received under the Qualified Plans but for (1) the dollar
limitation on Compensation taken into account under the Qualified Plans as a
result of Section 401(a)(17) of the Code, (2) the limitations imposed under
Section 415 of the Code, and (3) the limitations under Sections 402(g),
401(k)(3) and 401(m) of the Code.
SECTION 1.3. GOVERNING LAW. This Plan shall be regulated,
construed and administered under the laws of the State of North Carolina, except
when preempted by federal law.
SECTION 1.4. GENDER AND NUMBER. For purposes of interpreting the
provisions of this Plan, the masculine gender shall be deemed to include the
feminine, the feminine gender shall be deemed to include the masculine, and the
singular shall
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include the plural unless otherwise clearly required by the
context.
SECTION 1.5. STATUS OF PLAN. This document is classified as a
single "plan" for purposes of recordkeeping, the Code and the requirements of
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"). For
purposes of the federal securities laws, however, this document shall be
classified as two separate "plans." One plan shall consist of the Accounts of
those persons who satisfy the requirements of an "accredited investor" or a
"sophisticated purchaser" under Rule 506 of the Securities Act of 1933 and the
other plan shall consist of the Accounts of all other Plan Participants.
ARTICLE II
DEFINITIONS
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Except as otherwise provided in this Plan, terms defined in the
Qualified Plans as they may be amended from time to time shall have the same
meanings when used herein, unless a different meaning is clearly required by the
context of this Plan. In addition, the following words and phrases shall have
the following respective meanings for purposes of this Plan.
SECTION 2.1. ACCOUNT shall mean the record maintained by the
Employer in accordance with Section 4.1 as the sum of the Participant's Excess
Profit Sharing Sub-Account, Excess 401(k) Sub-Account, Excess Matching
Sub-Account, Excess Deferral Sub-Account and LTIP Deferral Sub-Account.
SECTION 2.2. ADJUSTED ROE.
(a) For purposes of this Section, the following terms shall have
the following meanings:
(i) "NET INCOME (BEFORE EXTRAORDINARY ITEMS)" is defined as
consolidated net income, as defined by general
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accepted accounting principles ("GAAP"), for the Company or NACCO Industries,
Inc. and its subsidiaries, as applicable, for the subject year before
extraordinary items, but including any extraordinary items related to
refinancings (net of tax);
(ii) "AMORTIZATION OF GOODWILL" is defined as the consolidated
amortization expense related to the intangible asset goodwill for the Company or
NACCO Industries, Inc. and its subsidiaries, as applicable for the subject year;
(iii) "WEIGHTED AVERAGE STOCKHOLDERS' EQUITY" is calculated by
adding the consolidated stockholders' equity for the Company or NACCO
Industries, Inc., as applicable, as defined by GAAP, at the beginning of the
subject year and the end of each month of the subject year and dividing by
thirteen;
(iv) "WEIGHTED AVERAGE ACCUMULATED AMORTIZATION OF GOODWILL" is
calculated by adding consolidated accumulated amortization of goodwill, as
defined by GAAP, at the beginning of the subject year and the end of each month
of the subject year and dividing by thirteen; and
(v) "WEIGHTED AVERAGE UMWA ADJUSTMENT" is calculated by adding
the balance in the Obligation to United Mine Workers of America Combined Benefit
Fund, net of tax, for NACCO Industries, Inc. at the beginning of the subject
year and the end of each month of the subject year and dividing by thirteen.
(b) For Participants who are Employees of NACCO Industries,
Inc., "Adjusted ROE" shall mean the average return on equity of NACCO
Industries, Inc. calculated for the applicable time period, based on A divided
by B, where:
A = Net Income (before extraordinary items) + Amortization of
Goodwill; and
B = Weighted Average (Stockholders' Equity + Accumulated Amortization of
Goodwill + UMWA Adjustment).
(c) For Participants who are Employees of the Company, "Adjusted
ROE" shall mean the average return on equity of the Company calculated for the
applicable time period, based on A divided by B, where:
A = Net Income (before extraordinary items) + Amortization of
Goodwill; and
B = Weighted Average (Stockholders' Equity + Accumulated Amortization
of Goodwill).
(d) Adjusted ROE shall be determined at least annually by the
Employers.
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SECTION 2.3. BENEFICIARY shall mean the person or persons
designated by the Participant as his Beneficiary under this Plan, in accordance
with the provisions of Article VIII hereof.
SECTION 2.4. CASH BALANCE EMPLOYEE shall mean a participant in
the Cash Balance Plan.
SECTION 2.5. CASH BALANCE PLAN shall mean Part III of The
Combined Defined Benefit Plan for NACCO Industries, Inc. and Its Subsidiaries
(commonly known as the NACCO Materials Handling Group, Inc. Cash Balance Plan)
or any successor thereto. The Cash Balance Plan was generally frozen effective
December 31, 1996.
SECTION 2.6. COMPANY shall mean NACCO Materials Handling Group,
Inc. or any entity that succeeds NACCO Materials Handling Group, Inc. by merger,
reorganization or otherwise.
SECTION 2.7. COMPENSATION shall have the same meaning as under
the Profit Sharing Plan, except that Compensation shall be deemed to include (a)
the amount of compensation deferred by the Participant under this Plan,
excluding, however, LTIP Deferral Benefits and (b) amounts in excess of the
limitation imposed by Code Section 401(a)(17).
SECTION 2.8. EMPLOYER shall mean the Company and NACCO
Industries, Inc.
SECTION 2.9. EXCESS RETIREMENT BENEFIT OR BENEFIT shall mean an
LTIP Deferral Benefit, Excess Pension Benefit, Excess Profit Sharing Benefit,
Excess 401(k) Benefit, Excess Matching Benefit or Excess Deferral Benefit (as
described in Article III) which is payable to or with respect to a Participant
under this Plan.
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SECTION 2.10. FIXED INCOME FUND shall mean the Stable Asset Fund
under the Profit Sharing Plan or any equivalent fixed income fund thereunder
which is designated by the NACCO Industries, Inc. Retirement Funds Investment
Committee as the successor to the Stable Asset Fund.
SECTION 2.11. 401(k) EMPLOYEE shall mean an Employee of an
Employer who is a Participant in the Profit Sharing Plan who is eligible to
receive Before-Tax Contributions and Matching Employer Contributions thereunder.
SECTION 2.12. INSOLVENT. For purposes of this Plan, an Employer
shall be considered Insolvent at such time as it (a) is unable to pay its debts
as they mature, or (b) is subject to a pending voluntary or involuntary
proceeding as a debtor under the United States Bankruptcy Code.
SECTION 2.13. LTIP PLAN shall mean the NACCO Materials Handling
Group, Inc. Long-Term Incentive Compensation Plan (Effective January 1, 1990),
as amended.
SECTION 2.14. PARTICIPANT.
(a) For purposes of Section 3.1 of the Plan, the term
"Participant" means a Participant in the Cash Balance Plan who is an Employee of
the Company whose benefit under the Cash Balance Plan is limited by the
application of Section 401(a)(17) or 415 of the Code and who was designated as a
Participant in this Plan by the Administrative Committee.
(b) For purposes of Section 3.2 of the Plan, the term
"Participant" means a Participant in the profit sharing portion of the Profit
Sharing Plan (i) whose profit sharing benefit is limited by the application of
Section 401(a)(17) or 415 of the Code and (ii) who is either an Employee of
NACCO Industries, Inc. and has at least 950 Hay Points or is an Employee of the
Company and whose base salary as of the November 1 of the preceding Plan Year
was at least $100,000.
(c) For purposes of Section 3.4 and 3.5 of the Plan, the term
"Participant" means a 401(k) Employee who (i) is unable to make all of the
Before-Tax Contributions that he has elected to make to the Profit Sharing Plan,
or is unable to receive the maximum amount of Matching Employer Contributions
under the
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Profit Sharing Plan because of the limitations of Section 402(g), 401(a)(17),
401(k)(3), or 401(m) of the Code, and (ii) whose total annual compensation from
the Controlled Group for the Plan Year in which a deferral election is required
was at least $100,000.
(d) For purposes of Section 3.6 of the Plan, the term
"Participant" means an Employee of the Company (i) who is a participant in the
LTIP Plan, (ii) who is a U.S. citizen or resident alien and is covered on a U.S.
payroll and (iii) whose total annual compensation from the Controlled Group for
the Plan Year in which a deferral election is required was at least $100,000.
(e) The term "Participant" shall also include any other person
who, as of December 31, 1998, was entitled to receive an Excess Retirement
Benefit under the Plan.
SECTION 2.15. PLAN shall mean the NACCO Materials Handling
Group, Inc. Unfunded Benefit Plan, as herein set out or as duly amended.
SECTION 2.16. PLAN ADMINISTRATOR shall mean the Company.
SECTION 2.17. PLAN YEAR shall mean the calendar year.
SECTION 2.18. PRIOR PLAN shall mean the Yale Materials Handling
Corporation Unfunded Deferred Compensation Plan.
SECTION 2.19. PROFIT SHARING EMPLOYEE shall mean an Employee of
an Employer who is a participant in the Profit Sharing Plan and who is eligible
for Profit Sharing Contributions.
SECTION 2.20. PROFIT SHARING PLAN shall mean the NACCO Materials
Handling Group, Inc. Profit Sharing Plan or any successor thereto.
SECTION 2.21. QUALIFIED PLAN shall mean (a) for Cash Balance
Employees, the Cash Balance Plan, (b) for Profit Sharing Employees, the
profit-sharing portion of the Profit Sharing
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Plan and (c) for 401(k) Employees, the Before-Tax Contributions and Matching
Employer Contributions portion of the Profit Sharing Plan. References throughout
this Plan to a "Qualified Plan" shall be deemed to refer to the underlying
Qualified Plan to which a particular Excess Retirement Benefit relates.
SECTION 2.22. UNFORESEEABLE EMERGENCY shall mean an event which
results (or will result) in severe financial hardship to the Participant as a
consequence of an unexpected illness or accident or loss of the Participant's
property due to casualty or other similar extraordinary or unforeseen
circumstances out of the control of the Participant.
SECTION 2.23. Valuation Date shall mean the last day of each
Plan Year and any other date chosen by the Plan Administrator.
ARTICLE III
EXCESS RETIREMENT BENEFITS
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SECTION 3.1. EXCESS PENSION BENEFITS. The Excess Pension Benefit
payable to or with respect to a Participant who is a Cash Balance Employee shall
be a monthly benefit equal to the excess, if any, of (a) the amount of the
monthly benefit that would be payable to the Participant under the Cash Balance
Plan (in the form actually paid) if such Plan did not contain the limitations
imposed under Sections 401(a)(17) and 415 of the Code and, effective as of
January 1, 1995, the definition of "compensation" under such Plan included any
amounts deferred under this Plan, OVER (b) the amount of the monthly benefit
that is actually payable to the Participant under the Cash Balance Plan.
SECTION 3.2. EXCESS PROFIT SHARING BENEFITS.
(a) IN GENERAL. Each Employer shall credit to a Sub-Account (the
"Excess Profit Sharing Sub-Account") established for
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each Participant who is both an Employee of such Employer and a Profit Sharing
Employee, an amount equal to the excess, if any, of (i) the amount of the
Employer's Profit Sharing Contribution which would have been made to the profit
sharing portion of the Profit Sharing Plan on behalf of the Participant if (1)
such Plan did not contain the limitations imposed under Sections 401(a)(17) and
415 of the Code and (2) the term "Compensation" (as defined in Section 2.7
hereof) were used for purposes of determining the amount of profit sharing
contributions under the Qualified Plan, over (ii) the amount of the Employer's
Profit Sharing Contribution which is actually made to such Plan on behalf of the
Participant for such Plan Year (the "Excess Profit Sharing Benefits").
(b) MINIMUM BENEFIT. Notwithstanding the foregoing, the Excess
Profit Sharing Sub-Account balance of a Participant who was a participant in the
Prior Plan shall in no event be less than the amount credited to such
Participant's account under the Prior Plan as of February 10, 1993.
SECTION 3.3. BASIC AND ADDITIONAL EXCESS DEFERRAL BENEFITS.
(a) IN GENERAL. Prior to January 1, 1996, certain Employees of
the Company were permitted to elect to defer specified amounts of salary and
bonus of up to 7% of compensation (the "Basic Excess Deferrals") and in excess
of 7% of compensation (the "Additional Excess Deferrals"). The Basic Excess
Deferrals were credited to
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the "Excess Deferral Sub-Account No. 1" which shall be renamed the "Basic Excess
Deferral Sub-Account" and the Additional Excess Deferrals were credited to the
"Excess Deferral Sub-Account No. 2" which shall be renamed as the "Additional
Excess Deferral Sub-Account."
(b) PAYMENT DATE. At the time the Basic and Additional Excess
Deferrals were elected, the Participant irrevocably designated the date of
commencement of payment of such Excess Deferrals by choosing one of the
following dates: (a) the date on which he ceases to be an Employee of the
Controlled Group, (b) the date on which he attains an age specified in the
election form, or (c) the earlier or later of such dates.
SECTION 3.4. BASIC AND ADDITIONAL EXCESS 401(K) BENEFITS.
(a) AMOUNT OF EXCESS 401(k) BENEFITS. Each 401(k) Employee who
is a Participant, may, prior to the first day of any Plan Year, by completing a
"401(k) Deferral Election Form," direct his Employer to reduce his Compensation
for such Plan Year and, subject to Subsection (d) below, subsequent Plan Years,
by an amount equal to the difference between (i) a specified percentage, in 1%
increments, with a maximum of 17%, of his Compensation for the Plan Year, and
(ii) the maximum Before-Tax Contributions actually permitted to be contributed
for him to the Profit Sharing Plan for such Plan Year by reason of the
application of the limitations under Sections 402(g), 401(a)(17), and 401(k)(3)
of the Code (which amounts shall be referred to as the "Excess 401(k)
Benefits").
(b) CLASSIFICATION OF EXCESS 401(k) BENEFITS. The Excess 401(k)
Benefits for a particular Plan Year shall be calculated monthly and shall be
further divided into the "Basic Excess 401(k) Benefits" and the "Additional
Excess 401(k) Benefits" as follows:
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(i) The Basic Excess 401(k) Benefits shall be determined by
multiplying each Excess 401(k) Benefit by a fraction,
the numerator of which is the lesser of the percentage
of Compensation elected to be deferred in the 401(k)
Deferral Election Form for such Plan Year or 7% and the
denominator of which is the percentage of Compensation
elected to be deferred; and
(ii) The Additional Excess 401(k) Benefits (if any) shall be
determined by multiplying each Excess 401(k) Benefit by
a fraction, the numerator of which is the difference
between (1) the percentage of Compensation elected to
be deferred in the 401(k) Deferral Election Form for
such Plan Year and (2) 7%, and the denominator of which
is the percentage of Compensation elected to be
deferred.
The Basic Excess 401(k) Benefits shall be credited to the Basic Excess 401(k)
Sub-Account under this Plan and the Additional Excess 401(k) Benefits shall be
credited to the Additional Excess 401(k) Sub-Account hereunder.
(c) DEFERRAL PERIOD. The 401(k) Deferral Election Form shall
also contain such Participant's irrevocable election regarding the time of the
commencement of payment of the Excess 401(k) Benefits to which such Form relate.
Payment elections made prior to the Effective Date shall continue to govern the
timing of the payment of amounts credited to the Participant's Excess 401(k)
Sub-Account as of the Effective Date. In the 401(k) Deferral Election Form, such
Participant may elect to commence payment of his Excess 401(k) Sub-Account on
(i) the date
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on which he ceases to be an Employee of the Controlled Group, (ii) the date on
which he attains an age specified in the 401(k) Deferral Election Form, or (iii)
the earlier or later of such dates.
(d) EFFECT AND DURATION OF DEFERRAL ELECTION. Any direction by a
Participant to make deferrals of Excess 401(k) Benefits hereunder shall be
effective with respect to Compensation otherwise payable to the Participant
during the Plan Year for which the 401(k) Deferral Election Form is in effect,
and the Participant shall not be eligible to receive such Excess 401(k)
Benefits. Instead such amounts shall be credited to the Participant's Basic or
Additional Excess 401(k) Sub-Account (as applicable). Any directions made in
accordance with Subsection (a) above shall be irrevocable and shall remain in
effect for subsequent Plan Years unless changed or terminated by the Participant
for Plan Years commencing after such change or termination on the appropriate
form provided by the Plan Administrator, prior to the first day of any
subsequent Plan Year.
(E) AUTOMATIC TERMINATION/SUSPENSION OF DEFERRAL ELECTION.
(i) A Participant's direction to make deferrals of Excess 401(k)
Benefits shall automatically terminate on the earlier of the date on which (1)
the Participant ceases employment with the Employers, (2) the Participant's
Employer is deemed Insolvent, (3) the Participant is no longer eligible to make
deferrals of Excess 401(k) Benefits hereunder or (4) the Plan is terminated.
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(ii) Any Participant whose eligibility to make Before-Tax
Contributions to the Profit Sharing Plan has been suspended because he has taken
a hardship withdrawal from such plan shall not be eligible to defer Excess
401(k) Benefits under this Plan for the period of his suspension from the Profit
Sharing Plan.
(iii) The Plan Administrator may, in its sole and absolute
discretion, pursuant to nondiscriminatory rules adopted by the Plan
Administrator, reduce and/or cease the deferral of Excess 401(k) Benefits being
made by one or more Participants, to the extent deemed necessary or desirable in
order to satisfy the requirements of any applicable law (including, without
limitation, federal securities laws).
SECTION 3.5. EXCESS MATCHING BENEFITS.
(a) AMOUNT. A 401(k) Employee who is a Participant shall have
credited to his Basic or Additional Excess Matching Sub-Account (as applicable)
an amount equal to the Matching Employer Contributions attributable to the Basic
or Additional Excess 401(k) Benefits that he is prevented from receiving under
the Profit Sharing Plan because of the limitations of Code Sections 402(g),
401(a)(17), 401(k)(3) and 401(m) of the Code (the "Excess Matching Benefits").
(b) TIME OF PAYMENT. The Excess Matching Benefits shall be paid
(or commence to be paid) at the same time as the Excess 401(k) Benefits to which
they relate (as specified in the 401(k) Deferral Election Form applicable to
such Benefits).
SECTION 3.5 LTIP DEFERRAL BENEFITS.
(a) AMOUNT. Each Participant (as defined in Section 2.14(d))
may, with the consent of the Company, by completing an approved deferral
election form, direct the Company:
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(i) to reduce an Award (as that term is defined in the LTIP
Plan) payable under the LTIP Plan by a specified dollar amount or percentage;
and
(ii) to credit the amount of the reduction (the "LTIP Deferral
Benefits") to the LTIP Deferral Sub-Account hereunder. Such election must be
made no later than one-year prior to the date such Award would otherwise be
payable to the Participant under the LTIP Plan or at such other time as approved
by the Company, in its sole and absolute discretion.
(b) DEFERRAL PERIOD. The deferral election made by a Participant
under Subsection (a) above shall also contain such Participant's irrevocable
election regarding the time of the commencement of payment of the LTIP Deferral
Benefits to which such form relates. The Participant may elect to commence
payment of his LTIP Deferral Benefits on (i) the date on which he ceases to be
an Employee of the Controlled Group, (ii) the date on which he attains an age
specified in the deferral form, or (iii) the earlier or later of such dates.
(c) EFFECT OF DEFERRAL ELECTION. While separate deferral
elections may be entered into with respect to each Award payable under the LTIP
Plan, any direction by a Participant to defer receipt of all or part of a
specific Award and to receive LTIP Deferral Benefits in lieu thereof shall be
irrevocable with respect to that Award.
(d) AUTOMATIC TERMINATION OF DEFERRAL ELECTION.
(i) A Participant's direction to defer an Award under the LTIP
Plan shall automatically terminate on the earlier of the date on which (1) the
Participant ceases employment with the Controlled Group,, (2) the Participant
ceases to satisfy the
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requirements of Section 2.14(d), (3) the Company is deemed Insolvent or (4) the
Plan is terminated.
(ii) The Plan Administrator may, in its sole and absolute
discretion, pursuant to nondiscriminatory rules adopted by the Plan
Administrator, reduce and/or cease the deferral of LTIP Deferral Benefits being
made by one or more Participants, to the extent deemed necessary or desirable in
order to satisfy the requirements of any applicable law (including, without
limitation, federal securities laws).
ARTICLE IV
ACCOUNTS
SECTION 4.1. PARTICIPANTS' ACCOUNTS. Each Employer shall
establish and maintain on its books an Account for each Participant which shall
contain the following entries:
(a) Credits to an Excess Profit Sharing Sub-Account for the
Excess Profit Sharing Benefits described in Section 3.2, which shall be credited
to the Sub-Account at the time the Profit Sharing Contributions are otherwise
credited to Participants' accounts under the Profit Sharing Plan.
(b) Credits to a Basic or Additional Excess Deferral Sub-Account
for the Basic and Additional Excess Deferrals described in Section 3.3.
(c) Credits to a Basic or Additional Excess 401(k) Sub-Account
for the Basic and Additional Excess 401(k) Benefits described in Section 3.4,
which shall be credited to the Sub-Account when a 401(k) Employee is prevented
from making a Before-Tax Contribution under the Profit Sharing Plan.
(d) Credits to a Basic or Additional Excess Matching Sub-Account
for the Basic and Additional Excess Matching Benefits described in Section 3.5,
which amounts shall be credited to the Sub-Account when a 401(k) Employee is
prevented from receiving Matching Employer Contributions under the Profit
Sharing Plan.
(e) Credits to an LTIP Deferral Sub-Account for the LTIP
Deferral Benefits described in Section 3.6, which shall be credited to the
Sub-Account at the time the Award would otherwise be payable to the Participant
under the LTIP Plan.
(f) Credits to all Sub-Accounts for the earnings described in
Article V, which shall continue until the vested
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portions of such Sub-Accounts have been distributed to the Participant or his
Beneficiary.
(g) Debits for any distributions made from the Sub-Accounts and
any amounts forfeited under Section 6.1(b). To the extent determined necessary
by the Company, the Company may also establish a "notional account" in the name
of each Cash Balance Employee to reflect the Excess Pension Benefits payable to
such Employees.
SECTION 4.2. EFFECT ON OTHER BENEFITS. Benefits payable to or
with respect to a Participant under the Qualified Plans or any other Employer
sponsored (qualified or nonqualified) plan, if any, are in addition to those
provided under this Plan.
ARTICLE V
EARNINGS
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SECTION 5.1. EARNINGS ON BASIC AND PROFIT SHARING SUB-ACCOUNTS.
(a) Subject to Subsection (b) and Section 5.4, at the end of
each calendar month during a Plan Year, the Excess Profit Sharing Sub-Account,
Basic Excess Deferral Sub-Account, Basic Excess 401(k) Sub-Account and Basic
Excess Matching Sub-Account of each Participant shall be credited with an amount
determined by multiplying such Participant's average Sub-Account balance during
such month by the blended rate earned during such month by the Fixed Income
Fund. Notwithstanding the foregoing, in the event that the Adjusted ROE
determined for such Plan Year that is applicable to the Participant exceeds the
rate credited to the Sub-Accounts under the preceding sentence, such
Sub-Accounts shall retroactively be credited with the difference between (i) the
amount determined under the preceding sentence, and (ii) the amount determined
by multiplying the Participant's average Sub-
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Account balance during each month of such Plan Year by the Adjusted ROE
determined for such Plan Year, compounded monthly.
(b) The Adjusted ROE calculation described in Subsection (a)
shall be made during the month in which the Participant terminates employment
and shall be based on the year-to-date Adjusted ROE for the month ending prior
to the date the Participant terminated employment, as calculated by the
Participant's Employer. For any subsequent month following termination, such
Adjusted ROE calculation shall not apply. The Fixed Income Fund calculation
described above for the month in which the Participant receives a distribution
from his Sub-Account shall be based on the blended rate earned during the
preceding month by the Fixed Income Fund.
SECTION 5.2. EARNINGS ON ADDITIONAL SUB-ACCOUNTS. Subject to
Section 5.4, at the end of each calendar month during the Plan Year, the
Additional Excess Deferral Sub-Account, Additional Excess 401(k) Sub-Account and
Additional Excess Matching Sub-Account of each Participant shall be credited
with an amount determined by multiplying such Participant's average Sub-Account
balance during such month by the blended rate earned during such month by the
Fixed Income Fund. The earnings calculation for the month in which the
Participant receives a distribution from his Sub-Account shall be based on the
blended rate earned during the preceding month by the Fixed Income Fund.
SECTION 5.3. EARNINGS ON LTIP DEFERRAL SUB-ACCOUNTS. Subject to
Section 5.4, at the end of each calendar month during a Plan Year, the LTIP
Deferral Sub-Account of each Participant shall be credited with an amount
determined by multiplying such Participant's average Sub-Account balance during
such month by
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the "10-Year U.S. Treasury Yield" plus 2.0%. For purposes hereof, the 10-Year
U.S. Treasury Yield shall be the 10 year yield on U.S. Treasury issues as listed
in the BOND MARKET DATA BANK for the last day of the preceding calendar quarter
as printed in the WALL STREET JOURNAL. In the event that a yield is not listed
for a maturity exactly 10 years from the calendar quarter end, the next
preceding chronological treasury bond issue yield shall be used.
SECTION 5.4. CHANGES IN/LIMITATIONS ON EARNINGS ASSUMPTION.
(a) The Nominating, Organization and Compensation Committee of
the Board of Directors of the Company (the "Committee") may change (but not
suspend) the earnings rate credited on Accounts under the Plan at any time upon
at least 30 days advance notice to Participants.
(b) Notwithstanding any provision of the Plan to the contrary,
in no event will earnings on Accounts for a Plan Year be credited at a rate
which exceeds 14%.
ARTICLE VI
VESTING
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SECTION 6.1. VESTING.
(a) EXCESS DEFERRAL SUB-ACCOUNT, EXCESS 401(k) SUB-ACCOUNT,
EXCESS MATCHING SUB-ACCOUNT AND LTIP DEFERRAL SUB-ACCOUNT. A Participant shall
always be 100% vested in the amounts credited to his Excess Deferral
Sub-Account, his Excess 401(k) Sub-Account, his Excess Matching Sub-Account and
his LTIP Deferral Sub-Account hereunder.
(b) EXCESS PENSION BENEFIT AND EXCESS PROFIT SHARING BENEFIT. A
Participant shall not become vested in his Excess
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Pension Benefit or Excess Profit Sharing Benefit until he becomes vested in
the corresponding benefit under the underlying Qualified Plan and the Excess
Pension Benefit and/or Excess Profit Sharing Benefit of a Participant who is
partially or fully vested under the underlying Qualified Plan shall at all times
be vested hereunder to the extent he is so vested. The non-vested portion of any
Benefit shall be forfeited upon a Participant's termination of employment with
the Controlled Group, in accordance with the vesting, forfeiture and service
rules contained in the applicable underlying Qualified Plan and any such
forfeiture shall be subtracted from the applicable Sub-Account balance
hereunder.
ARTICLE VII
DISTRIBUTION OF BENEFITS TO PARTICIPANTS
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SECTION 7.1. TIME AND MANNER OF PAYMENT.
(a) EXCESS PENSION BENEFITS AND EXCESS PROFIT SHARING BENEFITS.
The vested Excess Pension Benefit and vested Excess Profit Sharing Benefit
payable to a Participant shall be paid in the form of a single lump sum payment
at the time the benefits payable to the Participant under the applicable
underlying Qualified Plan commence to be paid. For purposes of the Excess
Pension Benefit, such lump sum amount shall be equal to the Actuarial Equivalent
present value of such Excess Pension Benefit.
(b) EXCESS DEFERRAL SUB-ACCOUNT, EXCESS 401(k) SUB-ACCOUNT,
EXCESS MATCHING SUB-ACCOUNT AND LTIP DEFERRAL SUB-ACCOUNT.
(i) TIMING. Each of the above-named Sub-Accounts shall be paid
(or commence to be paid) to the Participant at the time
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specified in the deferral election form applicable to such Sub-Account.
(ii) FORM. Each such Sub-Account shall be distributed to the
Participant in the form of ten annual installments with each installment being
based on the value of the applicable Sub-Account on the Valuation Date on which
such installment is to be paid and being a fraction of such value in which the
numerator is one and the denominator is the total number of remaining
installments to be paid. Notwithstanding the foregoing, the Participant may
elect to receive the amount credited to a particular Sub-Account in the form of
a single lump sum payment or in annual installments for a period of less than 10
years by filing a notice in writing, signed by the Participant and filed with
the Plan Administrator while the Participant is alive and at least one year
prior to the time he had elected to commence receiving payment of such
Sub-Account. Any such election of the form of benefit may be changed at any time
and from time to time, without the consent of any other person, by filing a
later election in writing that is signed by the Participant and filed with the
Plan Administrator while the Participant is alive and at least one year prior to
the time he had elected to commence receiving payment of such Sub-Account.
(c) UNFORESEEABLE EMERGENCY DISTRIBUTIONS. Notwithstanding the
foregoing, an Employer may at any time, upon written request of the Participant,
cause to be paid to such Participant an amount equal to all or any part of the
Participant's Excess Deferral Sub-Account and/or Excess 401(k)Sub-Account and/or
Excess Matching Sub-Account if the Employer determines, in its absolute
discretion based on such
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reasonable evidence that it shall require, that such a payment or payments is
necessary for the purpose of alleviating the consequences of an Unforeseeable
Emergency occurring with respect to the Participant. Payments of amounts because
of an Unforeseeable Emergency shall be permitted only to the extent reasonably
necessary to satisfy the emergency need.
(d) SMALL ACCOUNTS. Notwithstanding the foregoing, in the event
that the vested portion of a Participant's total Account does not exceed $10,000
at the time of the Participant's termination of employment with the Controlled
Group, such vested portion of his Account shall automatically be paid to him in
a single lump sum payment as soon as practicable following his termination of
employment.
SECTION 7.2. LIABILITY FOR PAYMENT/EXPENSES. Each Employer shall
be liable for the payment of the Excess Retirement Benefits which are payable
hereunder to its Employees. Expenses of administering the Plan shall be paid by
the Employers, as directed by the Company.
ARTICLE VIII
BENEFICIARIES
-------------
SECTION 8.1. BENEFICIARY DESIGNATIONS. A designation of a
Beneficiary hereunder may be made only by an instrument (in form acceptable to
the Plan Administrator) signed by the Participant and filed with the Plan
Administrator prior to the Participant's death. Separate Beneficiary
designations may be made for each Benefit under the Plan. In the absence of such
a designation and at any other time when there is no existing Beneficiary
designated hereunder, (a) the Beneficiary of a Participant for his Excess
Pension Benefits shall be his
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beneficiary under the Cash Balance Plan, (b) the Beneficiary of a Participant
for his Excess 401(k) Benefits, his Excess Matching Benefits and his Excess
Profit Sharing Benefits shall be his beneficiary under the Profit Sharing Plan,
and (c) the Beneficiary of a Participant for his Excess Deferral Benefits and
his LTIP Deferral Benefits shall be his surviving spouse or, if none, his
estate. A person designated by a Participant as his Beneficiary who or which
ceases to exist shall not be entitled to any part of any payment thereafter to
be made to the Participant's Beneficiary unless the Participant's designation
specifically provided to the contrary. If two or more persons designated as a
Participant's Beneficiary are in existence with respect to a single Sub-Account,
the amount of any payment to the Beneficiary under this Plan shall be divided
equally among such persons unless the Participant's designation specifically
provides for a different allocation.
SECTION 8.2. CHANGE IN BENEFICIARY. (a) Anything herein or in
the Qualified Plans to the contrary notwithstanding, a Participant may, at any
time and from time to time, change a Beneficiary designation hereunder without
the consent of any existing Beneficiary or any other person. A change in
Beneficiary hereunder may be made regardless of whether such a change is also
made under the Qualified Plans. In other words, the Beneficiary hereunder need
not be the same as under the Qualified Plan.
(b) Any change in Beneficiary shall be made by giving written
notice thereof to the Employer or Plan Administrator and any change shall be
effective only if received prior to the death of the Participant.
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SECTION 8.3. DISTRIBUTIONS TO BENEFICIARIES.
(a) AMOUNT OF BENEFITS.
(1) AMOUNT OF EXCESS PENSION BENEFIT. The Excess Pension Benefit
payable to a Beneficiary under this Plan shall be a monthly
benefit equal to the excess, if any, of (i) the amount of
the monthly benefit that would be payable to the beneficiary
last effectively designated by the Participant under the
Qualified Plan (in the form actually paid) if such Plan did
not contain the limitations imposed under Sections
401(a)(17) and 415 of the Code, over (ii) the amount of the
monthly benefit that is actually paid to such beneficiary
under such Plan.
(2) AMOUNT OF EXCESS PROFIT SHARING BENEFIT, EXCESS DEFERRAL
BENEFIT, EXCESS 401(K) BENEFIT, EXCESS MATCHING BENEFIT AND
LTIP DEFERRAL BENEFIT. The above-described Benefits payable
to a Participant's Beneficiary under this Plan shall be
equal to the vested balance in the applicable Sub-Account of
such Participant on the date of the distribution of the
Sub-Account to the Beneficiary.
(b) TIME OF PAYMENT.
(1) EXCESS PENSION BENEFIT. The Excess Pension Benefit payable
to a Beneficiary under this Plan shall be paid at the time
the benefits payable to the Beneficiary last effectively
designated by the Participant under the Qualified Plan
commence to be paid.
(2) EXCESS PROFIT SHARING BENEFIT/EXCESS DEFERRAL BENEFIT/EXCESS
401(k) BENEFIT/EXCESS MATCHING BENEFIT AND LTIP DEFERRAL
BENEFIT. The above-described Benefits payable to a
Beneficiary under this Plan shall be paid as soon as
practicable following the death of the Participant.
(c) FORM OF PAYMENT. All Benefits payable to a Beneficiary
hereunder shall be paid in the form of a lump sum payment.
For purposes of the Excess Pension Benefit, such lump sum
amount shall be equal to the Actuarial Equivalent present
value of such Excess Pension Benefit.
ARTICLE IX
MISCELLANEOUS
-------------
SECTION 9.1. LIABILITY OF EMPLOYER. Nothing in this Plan shall
constitute the creation of a trust or other fiduciary
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relationship between an Employer and any Participant, Beneficiary or any other
person.
SECTION 9.2. LIMITATION ON RIGHTS OF PARTICIPANTS AND
BENEFICIARIES - NO LIEN. This Plan is designed to be an unfunded, nonqualified
plan. Nothing contained herein shall be deemed to create a trust or lien in
favor of any Participant or Beneficiary on any assets of an Employer. The
Employers shall have no obligation to purchase any assets that do not remain
subject to the claims of the creditors of the Employers for use in connection
with the Plan. No Participant or Beneficiary or any other person shall have any
preferred claim on, or any beneficial ownership interest in, any assets of the
Employers prior to the time that such assets are paid to the Participant or
Beneficiary as provided herein. Each Participant and Beneficiary shall have the
status of a general unsecured creditor of his Employer.
SECTION 9.3. NO GUARANTEE OF EMPLOYMENT. Nothing in this
Plan shall be construed as guaranteeing future employment to Participants. A
Participant continues to be an Employee of an Employer solely at the will of
such Employer subject to discharge at any time, with or without cause.
SECTION 9.4. PAYMENT TO GUARDIAN. If a Benefit payable
hereunder is payable to a minor, to a person declared incompetent or to a person
incapable of handling the disposition of his property, the Plan Administrator
may direct payment of such Benefit to the guardian, legal representative or
person having the care and custody of such minor, incompetent or person. The
Plan Administrator may require such proof of incompetency, minority, incapacity
or guardianship as it may deem appropriate
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prior to distribution of the benefit. Such distribution shall completely
discharge the Employers from all liability with respect to such Benefit.
SECTION 9.5. ASSIGNMENT. (a) Subject to Subsection (b), no
right or interest under this Plan of any Participant or Beneficiary shall be
assignable or transferable in any manner or be subject to alienation,
anticipation, sale, pledge, encumbrance or other legal process or in any manner
be liable for or subject to the debts or liabilities of the Participant or
Beneficiary.
(b) Notwithstanding the foregoing, the Plan Administrator
shall honor a judgment, order or decree from a state domestic relations court
which requires the payment of all or a part of a Participant's or Beneficiary's
vested interest under this Plan to an "alternate payee" as defined in Code
Section 414(p).
SECTION 9.6. SEVERABILITY. If any provision of this Plan or
the application thereof to any circumstance(s) or person(s) is held to be
invalid by a court of competent jurisdiction, the remainder of the Plan and the
application of such provision to other circumstances or persons shall not be
affected thereby.
ARTICLE X
ADMINISTRATION OF PLAN
----------------------
SECTION 10.1. ADMINISTRATION. (a) IN GENERAL. The Plan shall be
administered by the Plan Administrator. The Plan Administrator shall have
discretion to interpret where necessary all provisions of the Plan (including,
without limitation, by supplying omissions from, correcting deficiencies in, or
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resolving inconsistencies or ambiguities in, the language of the Plan), to make
factual findings with respect to any issue arising under the Plan, to determine
the rights and status under the Plan of Participants or other persons, to
resolve questions (including factual questions) or disputes arising under the
Plan and to make any determinations with respect to the benefits payable under
the Plan and the persons entitled thereto as may be necessary for the purposes
of the Plan. Without limiting the generality of the foregoing, the Plan
Administrator is hereby granted the authority (i) to determine whether a
particular employee is a Participant, and (ii) to determine if a person is
entitled to Benefits hereunder and, if so, the amount and duration of such
Benefits. The Plan Administrator's determination of the rights of any person
hereunder shall be final and binding on all persons, subject only to the
provisions of Sections 10.3 and 10.4 hereof.
(b) DELEGATION OF DUTIES. The Plan Administrator may
delegate any of its administrative duties, including, without limitation, duties
with respect to the processing, review, investigation, approval and payment of
Benefits, to a named administrator or administrators. Pursuant to this
provision, NACCO Industries, Inc. shall be responsible for the administration of
the Benefits for its employees.
SECTION 10.2. REGULATIONS. The Plan Administrator shall
promulgate any rules and regulations it deems necessary in order to carry out
the purposes of the Plan or to interpret the provisions of the Plan; provided,
however, that no rule, regulation or interpretation shall be contrary to the
provisions of the Plan. The rules, regulations and interpretations made by
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the Plan Administrator shall, subject only to the provisions of Sections 10.3
and 10.4 hereof, be final and binding on all persons.
SECTION 10.3. CLAIMS PROCEDURES. The Plan Administrator shall
determine the rights of a person to any Benefits hereunder. Any person who
believes that he has not received the Benefits to which he is entitled under the
Plan may file a claim in writing with the Plan Administrator. The Plan
Administrator shall, no later than 90 days after the receipt of a claim (plus an
additional period of 90 days if required for processing, provided that notice of
the extension of time is given to the claimant within the first 90 day period),
either allow or deny the claim in writing. If a claimant does not receive
written notice of the Plan Administrator's decision on his claim within the
above-mentioned period, the claim shall be deemed to have been denied in full.
A denial of a claim by the Plan Administrator, wholly or
partially, shall be written in a manner calculated to be understood by the
claimant and shall include:
(a) the specific reasons for the denial;
(b) specific reference to pertinent Plan provisions on which the
denial is based;
(c) a description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such material or information is
necessary; and
(d) an explanation of the claim review procedure.
A claimant whose claim is denied (or his duly authorized
representative) may within 60 days after receipt of denial of a claim file with
the Plan Administrator a written request for a review of such claim. If the
claimant does not file a request
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for review of his claim within such 60-day period, the claimant shall be deemed
to have acquiesced in the original decision of the Plan Administrator on his
claim. If such an appeal is so filed within such 60 day period, the Company (or
its delegate) shall conduct a full and fair review of such claim. During such
review, the claimant shall be given the opportunity to review documents that are
pertinent to his claim and to submit issues and comments in writing. For this
purpose, the Company (or its delegate) shall have the same power to interpret
the Plan and make findings of fact thereunder as is given to the Plan
Administrator under Section 10.1(a) above.
The Company shall mail or deliver to the claimant a written
decision on the matter based on the facts and the pertinent provisions of the
Plan within 60 days after the receipt of the request for review (unless special
circumstances require an extension of up to 60 additional days, in which case
written notice of such extension shall be given to the claimant prior to the
commencement of such extension). Such decision shall be written in a manner
calculated to be understood by the claimant, shall state the specific reasons
for the decision and the specific Plan provisions on which the decision was
based and shall, to the extent permitted by law, be final and binding on all
interested persons. If the decision on review is not furnished to the claimant
within the above-mentioned time period, the claim shall be deemed to have been
denied on review.
SECTION 10.4. REVOCABILITY OF PLAN ADMINISTRATOR/COMPANY ACTION.
Any action taken by the Plan Administrator or the Company with respect to the
rights or benefits under the Plan of any person shall be revocable by the
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Plan Administrator or the Company as to payments not yet made to such person,
and acceptance of any Benefits under the Plan constitutes acceptance of and
agreement to the Plan Administrator's or the Company's making any appropriate
adjustments in future payments to such person (or to recover from such person)
any excess payment or underpayment previously made to him.
SECTION 10.5. AMENDMENT. The Committee may at any time (without
the consent of any Employer) amend any or all of the provisions of this Plan,
except that (a) no such amendment may adversely affect any Participant's vested
Benefit as of the date of such amendment, and (b) no such amendment may suspend
the crediting of earnings on the balance of a Participant's Account, until the
entire balance of such Account has been distributed, in either case, without the
prior written consent of the affected Participant. Any amendment shall be in the
form of a written instrument executed by an officer of the Company on the order
of the Committee. Subject to the foregoing provisions of this Section, such
amendment shall become effective as of the date specified in such instrument or,
if no such date is specified, on the date of its execution.
SECTION 10.6. TERMINATION.
(a) The Committee (without the consent of any Employer), in its
sole discretion, may terminate this Plan at any time and for any reason
whatsoever, except that, subject to Subsection (b) hereof, (i) no such
termination may adversely affect any Participant's vested Benefit as of the date
of such termination and (ii) no such termination may suspend the crediting of
earnings on the balance of a Participant's Account,
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until the entire balance of such Account has been distributed, in either case,
without the prior written consent of the affected Participant. Any such
termination shall be expressed in the form of a written instrument executed by
an officer of the Company on the order of the Committee. Subject to the
foregoing provisions of this Section, such termination shall become effective as
of the date specified in such instrument or, if no such date is specified, on
the date of its execution. Written notice of any termination shall be given to
the Participants as soon as practicable after the instrument is executed.
(b) Notwithstanding anything in the Plan to the contrary, in the
event of a termination of the Plan (or any portion thereof), the Company, in its
sole and absolute discretion, shall have the right to change the time and form
of distribution of Participants' Excess Retirement Benefits including requiring
that all amounts credited to Participant's Account hereunder be immediately
distributed in the form of lump sum payments.
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SECTION 10.7. WITHDRAWAL BY EMPLOYER. Any Employer (other than
the Company) which adopts this Plan may elect separately to withdraw from such
Plan and such withdrawal shall constitute a termination of the Plan as to it;
provided, however, that (a) such terminating Employer shall continue to be an
Employer for the purposes hereof as to Participants or Beneficiaries to whom it
owes obligations hereunder, and (b) such termination shall be subject to the
limitations and other conditions described in Section 10.6, treating the
Employer as if it were the Company.
Executed, this 29th day of December, 1998.
NACCO MATERIALS HANDLING
GROUP, INC.
By: /s/ Charles A. Bittenbender
-----------------------------
Title: Assistant Secretary