Annual Report — Form 10-K Filing Table of Contents
Document/ExhibitDescriptionPagesSize
1: 10-K Annual Report HTML 2.65M
2: EX-4.H Mdu Resources Wbi Amended and Restated Note HTML 252K
Purchase Agreement 09-12-2013
3: EX-4.I Mdu Resources Wbi First Amended and Restated Note HTML 65K
Purchase Agreement 05-17-2016
4: EX-4.J Mdu Resources Wbi Second Amended and Restated Note HTML 64K
Purchase Agreement 07-26-2019
5: EX-10.H Mdu Resources Executive Incentive Compensation HTML 53K
Plan Amended 11-12-2020
6: EX-10.L Mdu Resources Long-Term Performance Incentive Plan HTML 73K
7: EX-10.N Mdu Resources Restrictive Stock Unit Award HTML 59K
Agreement
8: EX-10.Q Mdu Resources Section 16 Officers and Directors HTML 45K
9: EX-10.R Mdu Resources Nonqualified Defined Contribution HTML 82K Plan 11-12-20
10: EX-10.U Mdu Resources 401 K Retirement Plan Amendment HTML 41K
12-17-20
11: EX-21 Mdu Resources Subsidiaries of Mdu Resources HTML 51K
12: EX-23 Mdu Resources Consent of Independent Accounting HTML 38K
Firm
16: EX-95 Mdu Resources Mine Safety Disclosures HTML 110K
13: EX-31.A Mdu Resources Certification of Chief Executive HTML 42K
Officer
14: EX-31.B Mdu Resources Certification of Chief Financial HTML 42K
Officer
15: EX-32 Mdu Resources Certification of CEO and CFO HTML 40K
23: R1 Cover page HTML 102K
24: R2 Consolidated Statements of Income HTML 137K
25: R3 Consolidated Statements of Comprehensive Income HTML 113K
26: R4 Consolidated Balance Sheets HTML 185K
27: R5 Consolidated Statements of Equity HTML 125K
28: R6 Consolidated Statements of Cash Flows HTML 135K
29: R7 Basis of Presentation HTML 49K
30: R8 Accounting Policies HTML 133K
31: R9 Revenue from Contract with Customer HTML 219K
32: R10 Business Combinations HTML 47K
33: R11 Property, Plant, and Equipment HTML 89K
34: R12 Regulatory assets and liabilities HTML 88K
35: R13 Goodwill and other intangible assets HTML 83K
36: R14 Fair value measurements HTML 103K
37: R15 Debt HTML 97K
38: R16 Leases HTML 64K
39: R17 Asset retirement obligations HTML 52K
40: R18 Equity HTML 46K
41: R19 Stock-Based Compensation HTML 69K
42: R20 Accumulated other comprehensive income (Loss) HTML 77K
43: R21 Income Taxes HTML 128K
44: R22 Cash flow information HTML 60K
45: R23 Business segment data HTML 201K
46: R24 Employee benefit plans HTML 400K
47: R25 Jointly owned facilities HTML 68K
48: R26 Regulatory matters HTML 49K
49: R27 Commitments and contingencies HTML 68K
50: R28 Quarterly Data HTML 105K
51: R29 Schedule I-Condensed Financial Information of HTML 140K
Registrant
52: R30 Basis of Presentation (Policies) HTML 55K
53: R31 Accounting Policies (Policies) HTML 132K
54: R32 Revenue from Contract with Customer (Policies) HTML 53K
55: R33 Accumulated other comprehensive income (Loss) HTML 40K
(Policies)
56: R34 Business segment data (Policies) HTML 42K
57: R35 Commitment and Contingencies (Policies) HTML 43K
58: R36 Accounting Policies (Tables) HTML 97K
59: R37 Revenue from contracts with customers (Tables) HTML 212K
60: R38 Property, Plant, and Equipment (Tables) HTML 89K
61: R39 Regulatory assets and liabilities (Tables) HTML 134K
62: R40 Goodwill and other intangible assets (Tables) HTML 87K
63: R41 Fair value measurements (Tables) HTML 100K
64: R42 Debt (Tables) HTML 92K
65: R43 Leases (Tables) HTML 61K
66: R44 Asset Retirement Obligations (Tables) HTML 51K
67: R45 Stock-Based Compensation (Tables) HTML 69K
68: R46 Accumulated other comprehensive income (Loss) HTML 78K
(Tables)
69: R47 Income Taxes (Tables) HTML 133K
70: R48 Cash flow information (Tables) HTML 59K
71: R49 Business segment data (Tables) HTML 193K
72: R50 Employee Benefit Plans (Tables) HTML 399K
73: R51 Jointly owned facilities (Tables) HTML 68K
74: R52 Commitment and Contingencies Disclosure (Tables) HTML 47K
75: R53 Quarterly Data (Tables) HTML 105K
76: R54 Basis of Presentation (Details) HTML 79K
77: R55 Accounting Policies - Receivables Past Due 90 Days HTML 41K
(Details 1)
78: R56 Accounting Policies - CECL Table (Details 2) HTML 65K
79: R57 Accounting Policies - Accrued Unbilled Revenue HTML 40K
(Details 3)
80: R58 Accounting Policies - Retainage (Details 4) HTML 47K
81: R59 Accounting Policies - Inventory (Details 5) HTML 56K
82: R60 Accounting Policies - PPE (Details 6) HTML 44K
83: R61 Accounting Policies - Impairment of Long-Lived HTML 41K
Assets (Details 7)
84: R62 Natural Gas Costs Recoverable or Refundable HTML 43K
through Rate Adjustments (Details 8)
85: R63 Accounting Policies - Goodwill (Details 9) HTML 41K
86: R64 Accounting Policies - Derivatives (Details 10) HTML 43K
87: R65 Accounting Policies - EPS (Details 11) HTML 50K
88: R66 Accounting Policies - Income Taxes (Details 12) HTML 40K
89: R67 Disaggregation of revenue (Details) HTML 194K
90: R68 Contract balances (Details 2) HTML 60K
91: R69 Revenue from contracts with customers Remaining HTML 51K
performance obligations (Details 3)
92: R70 Business Combinations (Details) HTML 69K
93: R71 Business Combinations - Assets Acquired & HTML 63K
Liabilities Assumed (Details 2)
94: R72 Business Combinations Measurement Period HTML 41K
Adjustments (Details 3)
95: R73 Property, Plant, and Equipment (Details) HTML 127K
96: R74 Regulatory assets and liabilities (Details) HTML 111K
97: R75 Goodwill rollforward (Details) HTML 56K
98: R76 Other intangible assets (Details 2) HTML 57K
99: R77 Goodwill and other intangible assets Future HTML 52K
amortization expense (Details 3)
100: R78 Fair value measurements insurance contracts HTML 43K
(Details)
101: R79 Available-for-sale securities (Details 2) HTML 53K
102: R80 Fair value measurements (Details 3) HTML 71K
103: R81 Fair value measurements Fair value measurements HTML 43K
(Details 4)
104: R82 Fair value measurements (Details 5) HTML 48K
105: R83 Credit facilities (Details) HTML 68K
106: R84 Short-term Debt (Details 2) HTML 47K
107: R85 Long-term debt outstanding (Details 3) HTML 73K
108: R86 Long-term borrowings (Details 4) HTML 80K
109: R87 Schedule of debt maturities (Details 5) HTML 54K
110: R88 Lease costs (Details) HTML 55K
111: R89 Operating lease liabilities undiscounted cash HTML 58K
flows maturity schedule (Details 2)
112: R90 Lessor accounting (Details 3) HTML 43K
113: R91 Asset Retirement Obligations (Details) HTML 56K
114: R92 Common stock (Details) HTML 51K
115: R93 Common stock Common stock issuance (Details 2) HTML 54K
116: R94 Preferred Stock (Details) HTML 46K
117: R95 Stock based compensation plans (Details) HTML 48K
118: R96 Stock awards (Details 2) HTML 43K
119: R97 Restricted stock awards (Details 3) HTML 47K
120: R98 Performance share awards (Details 4) HTML 102K
121: R99 Accumulated other comprehensive income (Loss) HTML 70K
(Details)
122: R100 Reclassification out of accumulated other HTML 77K
comprehensive income (Loss) (Details 2)
123: R101 Components of income before income taxes from HTML 49K
continuing operations (Details)
124: R102 Income tax expense (Benefit) (Details 2) HTML 66K
125: R103 Components of deferred tax assets and liabilities HTML 80K
(Details 3)
126: R104 Carryforwards (Details 4) HTML 48K
127: R105 Deferred tax reconciliation (Details 5) HTML 50K
128: R106 Income tax expense (Benefit) Statutory Rate Versus HTML 84K
Actual Rate (Details 6)
129: R107 Cash flow information (Details) HTML 59K
130: R108 Business segment data (Details) HTML 211K
131: R109 Change in benefit obligations and plan assets HTML 126K
(Details)
132: R110 Benefit obligations in excess of plan assets HTML 50K
(Details 2)
133: R111 Components of net periodic benefit cost (Details HTML 101K
3)
134: R112 Estimated net loss and prior service credit HTML 50K
(Details 4)
135: R113 Weighted average assumptions (Details 5) HTML 63K
136: R114 Investment Allocations (Details 6) HTML 56K
137: R115 Health care rate assumptions and cost trend rate HTML 63K
(Details 7)
138: R116 Estimated future benefit payments and subsidies HTML 79K
(Details 8)
139: R117 Fair value - pension (Details 9) HTML 95K
140: R118 Fair value - other postretirement (Details 10) HTML 96K
141: R119 Nonqualified Benefit Plans Benefit Obligations HTML 48K
(Details 11)
142: R120 Nonqualified Benefit Plans Components of NPBC HTML 55K
(Details 12)
143: R121 Nonqualified Benefit Plans Weighted Average HTML 47K
Assumptions (Details 13)
144: R122 Nonqualified Benefit Plans Future Benefit Payments HTML 55K
(Details 14)
145: R123 Nonqualified Benefit Plans Contributions (Details HTML 43K
15)
146: R124 Nonqualified Benefit Plans Investments (Details HTML 50K
16)
147: R125 Defined Contribution Benefit Plans Contribution HTML 42K
(Details 17)
148: R126 Multiemployer Plans Zones (Details 18) HTML 48K
149: R127 Multiemployer Plans Participation by Plan (Details HTML 151K
19)
150: R128 Multiemployer Plan Contributions (Details 20) HTML 46K
151: R129 Jointly owned facilities (Details) HTML 64K
152: R130 Mnpuc (Details) HTML 55K
153: R131 Mtpsc (Details 2) HTML 55K
154: R132 Ndpsc (Details 3) HTML 59K
155: R133 Opuc (Details 4) HTML 54K
156: R134 Wutc (Details 5) HTML 54K
157: R135 Ferc (Details 6) HTML 45K
158: R136 Litigation (Details) HTML 44K
159: R137 Enviromental matters (Details 2) HTML 75K
160: R138 Purchase commitments (Details 3) HTML 61K
161: R139 Guarantees (Details 4) HTML 63K
162: R140 Variable interest entities (Details 5) HTML 42K
163: R141 Quarterly Data (Details) HTML 105K
164: R142 Condensed Statements of Income and Comprehensive HTML 94K
Income (Details)
165: R143 Condensed Balance Sheets (Details 2) HTML 166K
166: R144 Condensed Statements of Cash Flows (Details 3) HTML 85K
167: R145 Notes to Condensed Financial Statements (Details HTML 42K
4)
169: XML IDEA XML File -- Filing Summary XML 300K
22: XML XBRL Instance -- mdu-20201231_htm XML 7.06M
168: EXCEL IDEA Workbook of Financial Reports XLSX 241K
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171: ZIP XBRL Zipped Folder -- 0000067716-21-000007-xbrl Zip 876K
‘EX-10.R’ — Mdu Resources Nonqualified Defined Contribution Plan 11-12-20
WHEREAS, MDU Resources Group, Inc. (the “Company”) heretofore adopted the MDU Resources Group, Inc. Nonqualified Defined Contribution Plan (the “Plan”), an unfunded plan maintained for the purpose of providing deferred compensation for a select group of management or highly compensated employees, within the meaning of the United States Code of Federal Regulations Section 2520.104-23 and Sections 201(2), 301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974 (“ERISA”);
and
NOW, THEREFORE, the Plan is hereby amended and restated, effective January 1, 2021, to read in its entirety as follows:
SECTION 1. PURPOSE OF PLAN
The Plan is unfunded for purposes of Title I of ERISA and is maintained for the purpose of providing deferred compensation to a select group of management or highly compensated employees of the Company (within the meaning of the United States Code of Federal Regulations Section 2520.104-23 and Sections 201(2), 301(a)(3) and 401(a)(1) of the
ERISA). The Plan shall be administered in accordance with such purpose and in accordance with the provisions of Section 409A of the Code.
SECTION 2. DEFINITIONS
2.1 “Administrator” means the Compensation Committee of the Board.
2.2 “Beneficiary” means the person or entity determined to be a Participant’s beneficiary pursuant to Section 11.
2.3 “Board” means the Board of Directors of the Company.
2.4 “Code” means the Internal Revenue Code of 1986, as amended
from time to time.
2.5 “Company” means MDU Resources Group, Inc., and any current or future corporation that (a) is in a controlled group of corporations (within the meaning of Section 414(b) of the Code) of which MDU Resources Group, Inc. is a member and (b) has been approved by the Compensation Committee of the Board upon recommendation of the Chief Executive Officer to adopt the Plan for the benefit of its eligible employees. For purposes hereof, each such participating affiliate shall be deemed to have appointed MDU Resources Group, Inc. as its agent to act on its behalf in all matters relating to administration, amendment or termination of the Plan.
2.6 “Compensation”
means the annualized base salary paid to a Participant as of the first day of the Plan Year.
2.7 “ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
2.8 “Participant” means an employee of the Company who has been selected to participate in the Plan pursuant to Section 3.
2.9 “Plan” means the MDU Resources Group, Inc. Nonqualified Defined Contribution Plan, as set forth herein and as amended from time to time.
2.10 “Plan Year” means the calendar year.
SECTION
3. ELIGIBLE EMPLOYEES
The Administrator shall determine which management employees or highly compensated employees of the Company (within the meaning of the United States Code of Federal Regulations Section 2520.104-23 and Sections 201(2), 301(a)(3) and 401(a)(1) of the ERISA) shall be eligible to participate in the Plan, the eligibility waiting period (if any) and such other conditions as may be applicable from time to time. Subject to the provisions of the Plan, the Administrator may, from time to time, select from all eligible employees those who will be Participants. Notwithstanding anything to the contrary herein, an eligible employee may only become a Participant upon January 1 of a calendar year, or within the first ninety (90) days of employment. No employee shall be selected as an additional Participant in the Plan after December
31, 2020.
SECTION 4. ACCOUNTS
The Company shall establish and maintain on its books with respect to each Participant separate hypothetical account(s) which shall record (a) any Company contributions made on behalf of the Participant for a Plan Year pursuant to Section 5 below, and (b) the allocation of any hypothetical investment experience. In this regard, a separate account shall be established on behalf of a Participant for each year in which a contribution is made under the Plan.
SECTION 5. COMPANY CONTRIBUTIONS
For any Plan Year, the Administrator may elect to credit the account of any Participant designated by the Administrator an amount equal to a specified percentage of such Participant’s Compensation,
or a flat dollar amount. Any such credit shall be made entirely at the discretion of the Administrator and the amount of any such credit may be different for different Participants.
No employee shall have the right to be selected to receive a contribution under the Plan, or, having been so selected, to be selected to receive a future contribution. No Participant will receive further Company contributions with respect to Plan Years after the Plan Year ending December 31, 2020.
SECTION 6. ADJUSTMENTS TO ACCOUNTS AND TAX WITHHOLDING
Each Participant’s account(s) shall
be reduced by the amount of any distribution to the Participant from the applicable account (including any portion of a distribution that is withheld to satisfy any federal, state, and/or local tax withholding and any social security or Medicare tax withholding obligations). Pursuant to procedures established by the Administrator, each Participant’s account(s) shall be adjusted as of each business day the New York Stock Exchange is open to reflect the earnings or losses of any hypothetical investment media as may be designated by the Administrator and, if applicable, elected by the Participant. Any federal, state, and/or local tax withholding and any social security or Medicare tax withholding obligations may be satisfied by deducting or withholding from amounts distributed under the Plan or from other compensation payable to the Participant or by requiring the Participant to remit to the
Company an amount sufficient to satisfy the federal, state, and/or local tax withholding and any social security or Medicare tax withholding obligations. Additionally, to the extent social security or Medicare tax withholding is required prior to the date of distribution of an amount under the Plan, to the extent permitted by Code Section 409A, the Company may satisfy such tax withholding obligations (and any additional tax withholding obligations resulting from the deemed distribution of the withheld amounts) and make a corresponding reduction in the Participant’s applicable account(s).
SECTION 7. INVESTMENT OF ACCOUNTS
For purposes of determining the amount of earnings/appreciation and losses/depreciation to be credited to, or debited from, a Participant’s account(s), each Participant’s account(s)
shall be deemed invested in the investment options (designated by the Administrator as available under the Plan) as the Participant may elect from time to time, or, if applicable, in any default investment option designated by the Administrator, in accordance with such rules and procedures as the Administrator may establish. However, no provision of the Plan shall require the Company or the Administrator to actually invest any amounts in any fund or in any other investment vehicle.
SECTION 8. VESTING
8.1 Vesting of Accounts Prior to 2017 Plan Year. Each account of a Participant established for amounts credited to the Plan for Plan Years prior to 2017, shall be subject to a separate
four (4) year vesting period. With respect to a Participant’s first account, if the Participant was selected to participate in the Plan with respect to a Plan Year after January 1 of that Plan Year, the Participant shall be one hundred percent (100%) vested in the amounts credited to that account after completing four (4) Years of Participation relating to that account, with the four (4) years of participation commencing on the date of selection as a Participant and ending at midnight on the fourth anniversary of such date of selection. With respect to a Participant’s other accounts, a Participant shall be one hundred percent (100%) vested in the amounts credited to the applicable account after completing four (4) years of participation relating to the account, with the four (4) years of participation commencing on January 1 of the Plan Year in which the contribution was made to the account and ending at midnight on January
1 four (4) years thereafter. Partial or pro rata vesting shall not be permitted with respect to such Participants’ accounts.
8.2 Vesting of Accounts Beginning with 2017 Plan Year. With respect to any account established for amounts credited to the Plan on behalf of a Participant for Plan Years on and after 2017, the Participant shall become vested in a percentage of the fair market value of such portion of the account(s) as follows:
Years of Participation
Vested
Percentage
Less than 1 year
0%
1 year but less than 2
34%
2 years but less than 3
67%
3 years and thereafter
100%
For this purpose, a Participant shall be one hundred percent (100%) vested in the amounts credited to the Participant’s account upon completing three (3) years of participation relating to the applicable account, with the three (3) years of participation commencing on January 1 of the
Plan Year in which the contribution is made to the account and ending at midnight on January 1 three (3) years thereafter, however, contributions made to a Participant’s account after March 31 of a plan year will not commence the three (3) years of participation until January 1 of the following Plan Year.
8.3 Accelerated Vesting Upon Certain Events. Subject to the provisions of Section 14, and notwithstanding the foregoing provisions of this Section 8, if a Participant (a) dies while employed by the Employer, (b) is an officer of the Company, and terminates employment after the Participant’s 65th birthday and prior to the end of the vesting period(s) with respect to the Participant’s account(s), (c) separates from service with
the Company (within the meaning of Code Section 409A) after attaining age sixty (60) and completing at least ten (10) “years of continuous service” with the Company, as measured from the Participant’s initial date of hire with the Company and calculated in accordance with rules and procedures established by the Company, or (d) involuntary separates from service with the Company within twelve (12) months of a “change in control” of the Company (within the meaning of
Code Section 409A), then such Participant shall have a nonforfeitable (vested) right to 100% of the amounts credited to the Participant’s account(s). If a Participant separates from service for any reason other than as described in the prior sentence, such Participant shall have a nonforfeitable (vested) right to the amounts credited to the Participant’s account(s) only to the extent such amounts had vested as of the date of the separation from service.
SECTION 9. TIME AND MANNER OF DISTRIBUTION
9.1 Distribution Elections.
(a) Any employee of the Company who is eligible to participate in the Plan as described in Section 3 shall elect the time and form of payment for his account(s) in accordance with the
rules and procedures prescribed by the Administrator. Beginning with amounts credited to a Participant’s account for 2017, the Participant’s irrevocable distribution election will be effective only for one Plan Year and will apply to amounts credited to the Participant’s account for that Plan Year (or portion of that Plan Year)
to which the distribution election relates, regardless of when such amounts are otherwise scheduled to be contributed.
(b) The Administrator may establish election periods during which a Participant’s irrevocable election must be received by the Administrator. However, no election may be made or accepted after the December 31 immediately preceding the Plan Year for which the election
is to be effective. Notwithstanding the foregoing, in the Plan Year in which an employee of the Company first becomes eligible to participate in the Plan, the Participant may make his distribution election within 30 days after the date upon which he becomes eligible to participate. A distribution election that is not timely made with respect to a Plan Year, as determined by the Administrator, shall have no effect with respect to such Plan Year and shall be considered void.
(c) In the event that a Participant fails to make a valid distribution election for a Plan Year, the Participant will be deemed to have elected to receive the amounts credited to his account for such Plan Year in a single lump sum payment upon the Participant’s “separation from service” with the
Company (within the meaning of Code Section 409A).
9.2 Form of Distribution.
(a) Each Participant shall elect to receive the amounts credited to his account for each Plan Year in one of the following modes of distribution:
(i) a single lump sum payment; or
(ii) annual installments over a period of up to ten (10) years, the amount of each installment to equal the balance of the Participant’s vested account(s) immediately prior to the installment divided by the number of installments remaining to be paid. Each subsequent installment shall be made on the first business day of the calendar month following the one (1) year anniversary of the prior payment.
(b) With respect to any account established
for amounts credited to the Plan on behalf of a Participant for Plan Years prior to 2017, distribution of such account(s) shall be made in accordance with the Participant’s prior election.
9.3 Time of Distribution. Subject to the provisions in this Section 9 and the provisions of Sections 10 and 14, distribution of a Participant’s vested account(s) shall be made or commence as follows:
(a) If the Participant elected a single lump sum payment, such lump sum payment shall be made within ninety (90) days following the Participant’s “separation from service” with the Company (within the meaning of Code Section 409A); or
(b) If the Participant elected annual installments:
(i) for
any account(s) established for amounts credited to the Plan on behalf of a Participant for Plan Years prior to 2017, the annual installments shall commence within ninety (90) days following the Participant’s “separation from service” with the Company (within the meaning of Code Section 409A) or, if later, the date the Participant attains age sixty-five (65);
(ii) for any account(s) established for amounts credited to the Plan on behalf of a Participant for Plan Years on and after 2017, the annual installments shall commence within ninety (90) days following the Participant’s “separation from service” with the Company (within the meaning of Code Section 409A) or if later, the date the Participant attains age sixty-five (65), as elected by the Participant
in accordance with rules and procedures prescribed by the Administrator.
provided, however that, in either case, if the Participant is a “specified employee” of the Company (as defined under Section 409A(a)(2)(B)(i) of the Code) on the date of separation from service, distribution shall not be made or commence prior to the first business day after the date that is six (6) months after the Participant’s separation from service or, if earlier, within ninety (90) days following the date of the Participant’s death. “Specified employees” shall be determined in accordance with the Company’s Specified Employee Policy Regarding Compensation, which is attached as Annex A.
Notwithstanding
the foregoing, payment may be delayed under any of the circumstances permitted under said Section 409A. Provided, further, that, if any amounts credited to a Participant’s vested account(s) become subject to tax under Section 409A of the Code, the amount required to be included in income as a result of the failure to comply with the requirements of Code Section 409A and related Treasury Regulations shall be immediately distributed to the Participant.
Payment shall be treated as made upon the date specified under the Plan if payment is made on such date or a later date within the same taxable year of the Participant or, if later, by the fifteenth (15th) day of the third (3rd) calendar month following the specified payment date (or, if payment may be made during a specified period of time, the first date in such period), provided the Participant
is not permitted, directly or indirectly, to designate the taxable year of the payment.
SECTION 10. DEATH BENEFIT
In the event of the death of a Participant while in the employ of the Company, vesting in the Participant’s account(s) shall be one hundred percent (100%), if not otherwise one hundred percent (100%) vested under Section 8, with the value of the Participant’s account(s) being distributed to the Participant’s Beneficiary, in a single lump sum payment, within the period from (i) the date of the Participant’s death to (ii) December 31 of the year following the year of the Participant’s death.
In
the event a Participant dies (a) after distribution has commenced under the Plan or (b) after separation from service, but prior to the date distribution is made or commences, the vested balance of the Participant’s account(s), if any, shall be distributed to the Participant’s Beneficiary, in a single lump sum payment, within the period set forth in the preceding paragraph.
Payment shall be treated as made upon the date specified under the Plan if payment is made at such date or a later date within the same taxable year of the Participant or, if later, by the fifteenth (15th) day of the third (3rd) calendar month following the specified payment date (or, if payment may be made during a specified period of time, the first date in such period), provided neither the Participant nor any Beneficiary is permitted, directly or indirectly, to
designate the taxable year of the payment.
SECTION 11. BENEFICIARY DESIGNATION
A Participant may designate the person or persons to whom the Participant’s vested account(s) under the Plan shall be paid in the event of the Participant’s death, in accordance with rules and procedures established by the Administrator. If no Beneficiary is designated, or no Beneficiary survives the Participant, payment shall be made to the Participant’s surviving spouse, or if none, to the Participant’s estate. If a Beneficiary survives the Participant, but dies before the balance payable to the Beneficiary has been distributed, any remaining balance shall be paid to the Beneficiary’s estate.
SECTION 12. PLAN ADMINISTRATION
12.1 Authority of Administrator. The Administrator
has the discretionary authority to interpret and construe any provision of the Plan and any agreement or instrument entered into under the Plan, to determine eligibility and benefits under the Plan, to prescribe, amend, waive and rescind rules and regulations relating to the Plan, to adopt such forms as it may deem appropriate for the administration of the Plan, to provide for conditions and assurances deemed necessary or advisable to protect the interests of the Company and to make all other determinations necessary or advisable for the administration of the Plan, but only to the extent not contrary to the express provisions of the Plan or the provisions of Section 409A of the Code and the regulations and rulings promulgated thereunder. Determinations, interpretations or other actions made or taken by the Administrator under the Plan shall be final and binding for all purposes and upon
all persons.
12.2 Delegation of Authority by the Board. Notwithstanding the general authority of the Administrator to select Participants of the Plan and determine the amount of contributions to be credited to Participants’ plan account(s), the Board may, by resolution, expressly delegate to one or more executive officers of the Company the authority, solely with respect to employees who are not subject to Section 16 of the Securities Exchange Act of 1934, as amended, to determine, within the parameters set forth in the Plan or established by the Board or the Administrator, the amount of any contributions to be credited to Participants’ account(s) as bookkeeping entries.
12.3 Hold
Harmless. The Company shall indemnify, hold harmless and defend the Administrator (and its delegates) and each executive officer appointed by the Board pursuant to Section 12.2 from any liability which any of them may incur in connection with the performance of its duties in connection with this Plan, so long as the Administrator (or such delegate or executive officer) was acting in good faith and within what the Administrator (or such delegate or executive officer) reasonably understood to be the scope of its duties.
12.4 Appeal Procedure.
(a) Claims for benefits under the Plan made by a Participant or Beneficiary (the "claimant") must be submitted in writing to the Administrator.
If
a claim is denied in whole or in part, the Administrator shall notify the claimant within ninety (90) days after receipt of the claim (or within one hundred eighty (180) days, if special circumstances require an extension of time for processing the claim, and provided written notice indicating the special circumstances and the date by which a final decision is expected to be rendered is given to the claimant within the initial ninety (90) day period). If notification is not given in such period, the claim shall be considered denied as of the last day of such period and the claimant may request a review of the claim.
The notice of the denial of the claim shall be written in a manner calculated to be understood by the claimant and shall set forth the following:
(i) the specific reason or reasons for the denial of the claim;
(ii) the
specific references to the Plan provisions on which the denial is based;
(iii) a description of any additional material or information necessary to perfect the claim, and an explanation of why such material or information is necessary; and
(iv) a statement that any appeal of the denial must be made by giving to the Administrator, within sixty (60) days after receipt of the denial of the claim, written notice of such appeal, such notice to include a full description of the pertinent issues and basis of the claim.
(b) Upon denial of a claim in whole or part, the claimant (or his duly authorized representative) shall have the right to submit a written request to the Administrator for a full and fair review of the denied claim, to be permitted to review documents pertinent to the denial, and to submit issues and comments in writing. Any
appeal of the denial must be given to the Administrator within the period of time prescribed under (a)(iv) above. If the claimant (or his duly authorized representative) fails to appeal the denial to the Administrator within the prescribed time, the Administrator’s adverse determination shall be final, binding and conclusive.
The Administrator may hold a hearing or otherwise ascertain such facts as it deems necessary and shall render a decision which shall be binding upon both parties. The Administrator shall advise the claimant of the results of the review within sixty (60) days after receipt of the written request for the review, unless special circumstances require an extension of time for processing, in which case a decision shall be rendered as soon
as possible but not later than one hundred twenty (120) days after receipt of the request for review. If such extension of time is required, written notice of the extension shall be furnished to the claimant prior to the commencement of the extension. The decision of the review shall be written in a manner calculated to be understood by the claimant and shall include specific reasons for the decision and specific references to the pertinent Plan provisions on which the decision is based. The decision of the Administrator shall be final, binding and conclusive.
SECTION 13. FUNDING
13.1 Plan Unfunded. The Plan is unfunded for tax purposes and for purposes of Title I of ERISA. Accordingly, the obligation of the Company to make payments under the Plan
constitutes solely an unsecured (but legally enforceable) promise of the Company to make such payments, and no person, including any Participant or Beneficiary shall have any lien, prior claim or other security interest in any property of the Company as a result of this Plan. Any amounts payable under the Plan shall be paid out of the general assets of the Company and each Participant and Beneficiary shall be deemed to be a general unsecured creditor of the Company.
13.2 Rabbi Trust. The
Company may enter into a grantor trust to pay its obligations hereunder (e.g., a rabbi trust), the assets of which shall be, for all purposes, the assets of the Company. In the event the trustee of such trust is unable or unwilling to make payments directly to Participants and Beneficiaries and such trustee remits payments to the Company for delivery to Participants and Beneficiaries, the Company shall promptly remit such amount, less applicable income and other taxes required to be withheld, to the Participant or Beneficiary.
SECTION 14. FORFEITURE OF BENEFITS
Notwithstanding any provision of this Plan to the contrary, if any Participant
is discharged from employment with the Company for cause due to willful misconduct, dishonesty, or conviction of a crime or felony, all as determined in the sole discretion of the Administrator, the rights of such Participant (or any Beneficiary of such Participant) to any present or future benefit under the Plan (whether or not vested) shall be forfeited, to the extent not otherwise prohibited by applicable law.
SECTION 15. AMENDMENT
The Board shall have the right to amend, suspend or terminate the Plan at any time subject to the provisions of Section 409A of the Code; provided, however, that no such action shall, without the Participant’s consent, impair the Participant’s right with respect to any existing vested account(s)
under
the Plan. Subject to the provisions of Section 14, the termination of the Plan, with respect to some or all of the Participants, and any resulting distribution of the account balances of such affected Participants, shall be made in accordance with the provisions of Section 409A of the Code and shall not constitute the impairment of such Participant’s rights hereunder.
SECTION 16. NO ASSIGNMENT
A Participant’s right to the amount credited to his vested account(s) under the Plan shall not be subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of the Participant or the Participant’s Beneficiary.
SECTION 17. COMPANY-OWNED LIFE INSURANCE (“COLI”)
17.1 Company Owns All Rights. In
the event that, in its discretion, the Company purchases a life insurance policy or policies insuring the life of any Participant to allow the Company to informally finance and/or recover, in whole or in part, the cost of providing the benefits hereunder, neither the Participant nor any Beneficiary shall have any rights whatsoever therein. The Company shall be the sole owner and beneficiary of any such policy or policies and shall possess and may exercise all incidents of ownership therein, except in the event of the establishment of and transfer of said policy or policies to a trust by the Company as described in Section 13.2 hereof.
17.2 Participant
Cooperation. If the Company decides to purchase a life insurance policy or policies on any Participant, the Company shall so notify such Participant. Such Participant shall take whatever actions may be necessary to enable the Company to timely apply for and acquire such life insurance and to fulfill the requirements of the insurance carrier relative to the issuance thereof as a condition of eligibility to participate in the Plan. Any Participant who declines to supply information or to otherwise cooperate so that the Company may obtain life insurance on behalf of such Participant shall be denied participation in the
Plan.
SECTION 18. SUCCESSORS AND ASSIGNS
The provisions of this Plan shall be binding upon and inure to the benefit of the Company, its successors and assigns, and the Participant, his Beneficiaries, heirs, legal representatives and assigns.
Nothing contained herein shall be construed as a contract of employment between a Participant and the Company, or as a right of the Participant to continue in employment with the
Company, or as a limitation of the right of the Company to discharge the Participant at any time, with or without cause.
SECTION 20. ENFORCEABILITY
If any term or condition of the Plan shall be invalid or unenforceable to any extent or in any application, then the remainder of the Plan, and such term or condition, except to such extent or in such application, shall not be affected thereby, and each and every term and condition of the Plan shall be valid and enforced to the fullest extent and in the broadest application permitted by law.
SECTION 21. CONSTRUCTION
Wherever
appropriate, the use of the masculine gender shall be extended to include the feminine and/or neuter, and the singular form of words extended to include the plural, or vice versa.
SECTION 22. GOVERNING LAW
This Plan shall be interpreted in a manner consistent with Code Section 409A and the guidance issued thereunder by the Department of the Treasury and the Internal Revenue Service and shall also be subject to and construed in accordance with the provisions of ERISA, where applicable, and otherwise by the laws of the State of North Dakota, without regard to the conflict of law provisions of any jurisdiction.
ANNEX
A
MDU RESOURCES GROUP, INC.
Specified Employee Policy Regarding Compensation
For purposes of all plans, agreements and other arrangements of MDU Resources Group, Inc. (the “Company”) and its affiliates that are subject to Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”), the determination of individuals who are “specified employees,” as that term is defined in Code Section 409A, shall be determined under this policy, as may be amended from time to time pursuant to paragraph 4 (“Policy”).
1.Establishment of Specified Employee List. Between January 1st and April 1st
of each calendar year, the Company shall establish a “Specified Employee List.” The Specified Employee List shall become effective on April 1st of the calendar year in which the Specified Employee List is established and shall cease to be effective on March 31st of the following calendar year. Any individual who, as of his or her “separation from service” (within the meaning of Code Section 409A(a)(2)(A)(i)), is on the Specified Employee List then in effect shall be considered a “specified employee” for purposes of Section 409A.
2.Inclusion on the Specified Employee List. The Specified Employee List shall include all individuals who, at any time during the Determination Year, met the
requirements of Code Section 416(i)(l)(A)(i), (ii) or (iii) and the related regulations (but without regard to Code Section 415(i)(5)). For this purpose, “Determination Year” shall mean the calendar year ending on the December 31st prior to the April 1st when the Specified Employee List becomes effective. For purposes of determining which individuals meet the requirements of Code Section 416(i)(l)(A)(i), (ii) or (iii) and the related regulations (but without regard to Code Section 415(i)(5)), the term gross compensation shall have the meaning set forth in the MDU Resources Group, Inc. 401(k) Retirement Plan, as may be amended from time to time (the “Retirement Plan”).
3.Delayed Payments. If any employee is determined to be a specified employee under this Policy, any compensation
to be provided to such specified employee that is required to be delayed to comply with Code Section 409A(a)(2)(B)(i) shall not be provided before the date that is six months after the date of such separation from service (or, if earlier than the end of such six-month period, the date of death of the specified employee). This Policy shall not apply to any payment that is not treated as deferred compensation under, or is otherwise excluded from, the requirements of Code Section 409A and the regulations promulgated thereunder.
4.Changes to Policy. The Company may amend or modify this Policy at any time; provided, however, that any changes made to the period during which the Specified Employee List is effective or the Determination Year shall not take effect for a period of at least 12 months and any
changes made to the definition of compensation (either in the Policy or in the Retirement Plan) shall not be used to identify specified employees until the next Specified Employee List is established.
Dates Referenced Herein and Documents Incorporated by Reference
