Document/Exhibit Description Pages Size
1: 10-K Annual Report 33 146K
2: EX-3 Exhibit 3.2 9 35K
3: EX-4 Exhibit 4.16E 10 31K
4: EX-4 Exhibit 4.17C 12 29K
5: EX-10 Exhibit 10.10 67 222K
6: EX-10 Exhibit 10.15 96 292K
7: EX-10 Exhibit 10.26 3 16K
8: EX-10 Exhibit 10.60 6 28K
9: EX-10 Exhibit 10.61 21 70K
10: EX-10 Exhibit 10.62 21 70K
11: EX-10 Exhibit 10.63 21 70K
12: EX-10 Exhibit 10.64 21 70K
13: EX-10 Exhibit 10.65 21 70K
14: EX-10 Exhibit 10.66 21 70K
15: EX-10 Exhibit 10.67 51 214K
16: EX-10 Exhibit 10.68 8 23K
17: EX-10 Exhibit 10.69 1 7K
18: EX-13 Annual or Quarterly Report to Security Holders 29 115K
19: EX-21 Subsidiaries of the Registrant 1 7K
20: EX-27 Financial Data Schedule (Pre-XBRL) 1 11K
22: EX-99 Exhibit 99.1 2 10K
21: EX-99 Miscellaneous Exhibit 2 9K
CHICAGO AND NORTH WESTERN RAILWAY COMPANY
SUPPLEMENTAL PENSION PLAN
(called the Chicago and North Western
Transportation Company Supplemental
Pension Plan until May 5, 1994)
Amendment and Restatement
Effective January 1, 1989
TABLE OF CONTENTS
ARTICLE 1. - General . . . . . . . . . . . . . . . . . . . . 1
1.1 General . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE 2. - Definitions . . . . . . . . . . . . . . . . . . 1
2.1 "Accrued Benefit" . . . . . . . . . . . . . . . . 1
2.2 "Actuarial Equivalent" . . . . . . . . . . . . . 4
2.3 "Actuary" . . . . . . . . . . . . . . . . . . . . 4
2.4 "Affiliated Company" or "Affiliated Companies" . 4
2.5 "Authorized Leave of Absence" . . . . . . . . . . 4
2.6 "Average Monthly Compensation" . . . . . . . . . 4
2.7 "Beneficiary" . . . . . . . . . . . . . . . . . . 5
2.8 "Benefit Service" . . . . . . . . . . . . . . . . 5
2.9 "Board of Directors" . . . . . . . . . . . . . . 6
2.10 "Committee" . . . . . . . . . . . . . . . . . . . 6
2.11 "Commonly Controlled Entity" . . . . . . . . . . 6
2.12 "Company" . . . . . . . . . . . . . . . . . . . . 6
2.13 "Compensation" . . . . . . . . . . . . . . . . . 6
2.14 "Continuous Service" . . . . . . . . . . . . . . 7
2.15 "Effective Date" . . . . . . . . . . . . . . . . 8
2.16 "Employee" . . . . . . . . . . . . . . . . . . . 8
2.17 "Employer" . . . . . . . . . . . . . . . . . . . 8
2.18 "ERISA" . . . . . . . . . . . . . . . . . . . . . 8
2.19 "Hour of Service" . . . . . . . . . . . . . . . . 8
2.20 "Internal Revenue Code" . . . . . . . . . . . . . 10
2.21 "Normal Retirement Date" . . . . . . . . . . . . 10
2.22 "One-Year-Break-in-Service" . . . . . . . . . . . 10
2.23 "Parental Leave" . . . . . . . . . . . . . . . . 11
2.24 "Participant" . . . . . . . . . . . . . . . . . . 11
2.25 "Pensioner" . . . . . . . . . . . . . . . . . . . 11
2.26 "Plan" . . . . . . . . . . . . . . . . . . . . . 11
2.27 "Plan Year" . . . . . . . . . . . . . . . . . . . 11
2.28 "Primary Railroad Retirement Benefit" . . . . . . 11
2.29 "Required Beginning Date" . . . . . . . . . . . . 12
2.30 "Retirement Benefits" . . . . . . . . . . . . . . 12
2.31 "Termination of Employment" . . . . . . . . . . . 12
2.32 "Trust" . . . . . . . . . . . . . . . . . . . . . 13
2.33 "Trust Agreement" . . . . . . . . . . . . . . . . 13
2.34 "Trustee" . . . . . . . . . . . . . . . . . . . . 13
2.35 "Trust Fund" . . . . . . . . . . . . . . . . . . 13
2.36 "Vesting Service" . . . . . . . . . . . . . . . . 13
ARTICLE 3. - Participation . . . . . . . . . . . . . . . . . 14
3.1 Participation . . . . . . . . . . . . . . . . . . 14
ARTICLE 4. - Eligibility for the Amount of Retirement Benefits 15
4.1 Normal Retirement . . . . . . . . . . . . . . . . 15
4.2 Early Retirement . . . . . . . . . . . . . . . . 15
4.3 Termination with Right to Deferred Pension . . . 15
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4.4 Death Benefits Prior to Commencement of
Retirement Benefits . . . . . . . . . . . . . . . 16
4.5 Reduction for Other Pensions . . . . . . . . . . 16
4.6 Changes in Railroad Retirement Benefits . . . . . 17
4.7 Special Early Retirement Benefits . . . . . . . . 17
4.8 No Duplication of Benefits . . . . . . . . . . . 21
4.9 Payment of Profit Sharing Plan Benefits . . . . . 21
ARTICLE 5. - Form and Payment of Retirement Benefits . . . . 22
5.1 Normal Period of Payment . . . . . . . . . . . . 22
5.2 Facility of Payment . . . . . . . . . . . . . . . 24
5.3 Effect of Return of Benefit Checks . . . . . . . 24
5.4 Effect of Continuing in or Resuming Employment . 24
5.5 Commencement of Benefits . . . . . . . . . . . . 25
5.6 Spousal Consents . . . . . . . . . . . . . . . . 25
5.7 Eligible Rollover Distributions . . . . . . . . . 26
5.8 Deduction of Taxes from Amounts Payable and
Mandatory Withholding on Certain Eligible Rollover
Distributions . . . . . . . . . . . . . . . . . . 27
ARTICLE 6. - Plan Financing . . . . . . . . . . . . . . . . . 28
6.1 Funding Policy . . . . . . . . . . . . . . . . . 28
6.2 Contributions . . . . . . . . . . . . . . . . . . 28
6.3 Forfeitures . . . . . . . . . . . . . . . . . . . 28
6.4 Exclusive Benefit of Participants . . . . . . . . 28
6.5 Benefits Payable Only From Trust Fund . . . . . . 29
ARTICLE 7. - Administration . . . . . . . . . . . . . . . . . 29
7.1 Board of Directors Duties . . . . . . . . . . . . 29
7.2 Committee Membership . . . . . . . . . . . . . . 29
7.3 Committee Structure . . . . . . . . . . . . . . . 30
7.4 Committee Actions . . . . . . . . . . . . . . . . 30
7.5 Committee Duties . . . . . . . . . . . . . . . . 30
7.6 Committee Liability . . . . . . . . . . . . . . . 31
7.7 Committee Bonding . . . . . . . . . . . . . . . . 31
7.8 Allocations and Delegations of Responsibility . . 31
7.9 Information to Be Supplied by Employers . . . . . 32
7.10 Validity of Records . . . . . . . . . . . . . . . 32
7.11 Fiduciary Capacity . . . . . . . . . . . . . . . 32
7.12 Company as Agent . . . . . . . . . . . . . . . . 32
7.13 Fiduciary as Participant . . . . . . . . . . . . 32
7.14 Fiduciary Responsibility . . . . . . . . . . . . 33
ARTICLE 8. - Claims Procedure . . . . . . . . . . . . . . . . 33
8.1 Initial Claim for Benefits . . . . . . . . . . . 33
8.2 Review of Claim Denial . . . . . . . . . . . . . 34
ARTICLE 9. - Trustee and Trust Fund . . . . . . . . . . . . . 35
9.1 Trust Agreement . . . . . . . . . . . . . . . . . 35
9.2 Selection of Trustee . . . . . . . . . . . . . . 35
9.3 Trustee's Duties . . . . . . . . . . . . . . . . 35
9.4 Trust Income . . . . . . . . . . . . . . . . . . 35
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9.5 Expenses . . . . . . . . . . . . . . . . . . . . 35
9.6 Trust Entity . . . . . . . . . . . . . . . . . . 35
ARTICLE 10. - Affiliated Companies . . . . . . . . . . . . . 36
10.1 Procedure for Adoption . . . . . . . . . . . . . 36
10.2 Termination by Affiliated Company . . . . . . . . 36
ARTICLE 11. - Amendment and Termination . . . . . . . . . . . 36
11.1 Amendments . . . . . . . . . . . . . . . . . . . 36
11.2 Termination . . . . . . . . . . . . . . . . . . . 37
11.3 Disposition of Fund on Termination . . . . . . . 37
11.4 Disposition Medium . . . . . . . . . . . . . . . 37
ARTICLE 12. - Top Heavy Provisions . . . . . . . . . . . . . 37
12.1 Application . . . . . . . . . . . . . . . . . . . 37
12.2 Special Top Heavy Definitions . . . . . . . . . . 38
12.3 Special Top Heavy Provisions . . . . . . . . . . 46
ARTICLE 13. - Miscellaneous Provisions . . . . . . . . . . . 51
13.1 Non-Alienation of Benefits . . . . . . . . . . . 51
13.2 Qualified Domestic Relations Order . . . . . . . 51
13.3 No Contract of Employment . . . . . . . . . . . . 53
13.4 Termination of Employment on Retirement . . . . . 54
13.5 Limitation on Vesting . . . . . . . . . . . . . . 54
13.6 No Duplication of Benefit . . . . . . . . . . . . 54
13.7 Temporary Limitations on Retirement Benefits
Payable to Highly Compensated Participants . . . 54
13.8 Maximum Pensions . . . . . . . . . . . . . . . . 57
13.9 Limitation on Liability . . . . . . . . . . . . . 60
13.10 Small Pensions . . . . . . . . . . . . . . . . . 61
13.11 Company Merger . . . . . . . . . . . . . . . . . 61
13.12 Plan Merger . . . . . . . . . . . . . . . . . . . 61
13.13 Invalidity of Certain Provisions . . . . . . . . 61
13.14 Headings . . . . . . . . . . . . . . . . . . . . 61
13.15 Uniform and Non-Discriminatory Treatment . . . . 61
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CHICAGO AND NORTH WESTERN
RAILWAY COMPANY
SUPPLEMENTAL PENSION PLAN
ARTICLE 1.
General
1.1 General. The Chicago and North Western Railway
Company Supplemental Pension Plan (called the Chicago and North
Western Transportation Company Supplemental Pension Plan until
May 5, 1994) (the "Plan") established, effective July 1, 1979, as
from time to time amended is hereby amended and restated as
herein set forth effective January 1, 1989. The purpose of the
Plan is to provide Employees with a supplement to retirement
benefits from the Chicago and North Western Railway Company
Profit Sharing and Retirement Savings Program (called the Chicago
and North Western Transportation Profit Sharing and Retirement
Savings Program until May 5, 1994) and Railroad Retirement to
assure retirement benefits of at least a specified minimum level.
The provisions of the Plan as herein amended and restated shall
apply to an Employee who terminates employment on or after
January 1, 1989 and shall not apply to any person not in the
active employment of an Employer on or after January 1, 1989
except as specifically provided herein. For purposes of this
Article l.l, a person receiving benefits under the Chicago and
North Western Railway Company Salary Continuance Plan (called the
Chicago and North Western Transportation Company Salary
Continuance Plan until May 5, 1994) shall be treated as in the
active employment of an Employer, and a person receiving benefits
under the Chicago and North Western Railway Company Long Term
Disability Plan (called the Chicago and North Western
Transportation Company Long Term Disability Plan until May 5,
1994) shall not be treated as in the active employment of an
Employer.
ARTICLE 2.
Definitions
The following terms shall have the meaning set forth below,
unless the context clearly indicates otherwise:
2.1 "Accrued Benefit" means a monthly amount payable to a
Participant commencing on or after his Normal Retirement Date in
the form of a single life annuity were the Participant to have a
Termination of Employment on the determination date, considering
Compensation and Benefit Service prior to Termination of
Employment, equal to (a) reduced by (b), (c), (d) and subject to
(e) below, and as further reduced under Articles 4.5 and 5.4:
(a) 1-1/2% of the Employee's Average Monthly
Compensation multiplied by the Employee's years of Benefit
Service (up to a maximum of 40 years).
(b) 87-1/2% of the Employee's Primary Railroad
Retirement Benefit, (1) if the Participant has at least 15
years of Vesting Service, and (2) if the Participant has
less than 15 years of Vesting Service, 87-1/2% of the
Participant's Primary Railroad Retirement Benefit multiplied
by a fraction, the numerator of which is the Participant's
years of Vesting Service and the denominator of which is 15.
Furthermore, in the case of a person who has a Termination
of Employment prior to age 65, the amount described in this
Article 2.1(b) shall be equal to the amount described in
this Article 2.1(b), determined on the basis of the years of
Vesting Service the Employee would have if he remained
employed until age 65, multiplied by a fraction, the
numerator of which is the Employee's years of Vesting
Service as of the date of Termination of Employment, and the
denominator of which is the years of Vesting Service the
Employee would have if the Employee remained employed until
age 65.
(c) The Actuarial Equivalent, in the form of an
annuity payable to the Participant for life commencing on
the Participant's Normal Retirement Date or Termination of
Employment if later, equal to the sum of (i) and (ii) below,
determined as of the earlier of the Participant's Normal
Retirement Date or Termination of Employment for those who
terminate on or before Normal Retirement Date, and at the
Termination of Employment for those who terminate after
Normal Retirement Date:
(i) The vested part of the Employee's Employer
Contribution Account under the Chicago and North
Western Railway Company Profit Sharing and Retirement
Savings Program (called the Chicago and North Western
Transportation Company Profit Sharing and Retirement
Savings Program until May 5, 1994)(the "Profit Sharing
Plan").
(ii) The additional vested amount which would have
been in the Employee's Employer Contribution Account
under the Profit Sharing Plan (excluding any amount
credited with respect to service for a non-railroad
employer) had the Employee made Employee Matched
Contributions, Employee Elected Matched Contributions
and Post-1986 Employee Matched Contributions, as
applicable for the Plan Year, to the Profit Sharing
Plan (excluding any income with respect to amounts
credited with respect to service for a non-railroad
employer) in the maximum amount permitted under the
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Profit Sharing Plan for each year during which he was
a Participant, determined by assuming that such
additional amounts would have consisted of an amount
that was the same percentage of the Participant's
Employee Matched Contributions, Employee Elected
Matched Contributions and Post-1986 Employee Matched
Contributions, as applicable under the Profit Sharing
Plan for each such year as Participants in the Profit
Sharing Plan actually received in each such year, plus
an amount equal to a participation in earnings, gains
and losses for each year equal to the average annual
earnings, gains and losses of all assets of the Profit
Sharing Plan for each year.
If an Employee has made any withdrawal under
subsection 5.4 of the Profit Sharing Plan or has,
prior to the determination date, received a
distribution from the Profit Sharing Plan, the
additional amount described in Article 2.1(c)(ii)
shall also include the additional amounts which would
have been in the Employee's Employer Contribution
Account if the Employee had not made such withdrawal
or received such distribution (including both (1) the
amount of any Employer contributions and Remainders
the Employee would have had added to his Employer
Contribution Account for the period subsequent to the
withdrawal during which the Employee was ineligible to
make Employee Elected Matched Contributions, Employee
Matched Contributions or Post-1986 Employee Matched
Contributions to the Profit Sharing Plan and (2) any
amounts withdrawn or distributed from the Employee's
Employer Contribution Account under the Profit Sharing
Plan) determined by assuming that such additional
amounts would have participated in earnings, gains and
losses for each year equal to the average annual
earnings, gains and losses of the Profit Sharing Plan
for each year.
(d) The Actuarial Equivalent, in the form of an
annuity payable to the Participant for life commencing on
the Participant's Normal Retirement Date, or Termination of
Employment, if later, of the sum of the vested part of the
Participant's Profit Sharing Excess Benefit Account under
the Chicago and North Western Railway Company Excess Benefit
Retirement Plan (called the Chicago and North Western
Transportation Company Excess Benefit Retirement Plan until
May 5, 1994) ("Excess Benefit Plan") and the vested part of
the Participant's Profit Sharing Executive Retirement
Benefit Account under the Chicago and North Western Railway
Company Executive Retirement Plan (called the Chicago and
North Western Transportation Company Executive Retirement
Plan until May 5, 1994) ("Executive Retirement Plan").
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(e) (i) If the Participant's Termination of
Employment occurs after he qualifies for a
Normal Retirement Pension in accordance with
Article 4.2, the amounts under Articles
2.1(c)(i), 2.1(c)(ii) and 2.1(d) shall be valued
as of the Valuation Date or Accounting Date
immediately preceding the date of his
Termination of Employment, excluding the
Participant's share of Employer contributions
and Remainders, if any, in the Profit Sharing
Plan, the Excess Benefit Plan, and the Executive
Retirement Plan, for the year in which such
termination occurs; and
(ii) If the Participant's Termination of
Employment occurs before he qualifies for a
Normal Retirement Pension in accordance with
Article 4.1 or an Early Retirement Pension in
accordance with Article 4.2, the amounts under
Articles 2.1(c)(i), 2.1(c)(ii) and 2.1(d) shall
be valued as of the Valuation Date or Accounting
Date immediately following the date of his
Termination of Employment increased by the
Participant's share of Employer contributions
and Remainders, if any, in the Profit Sharing
Plan, the Excess Benefit Plan, and the Executive
Retirement Plan, for the year in which such
Termination of Employment occurs.
2.2 "Actuarial Equivalent" means a benefit having the same
value as the benefit which it replaces, as determined by, or with
the advice of, the Actuary, using generally accepted actuarial
methods and assumptions as provided in Appendix I.
2.3 "Actuary" means the individual actuary or firm of
actuaries selected by the Committee to provide actuarial services
in connection with the administration of the Plan.
2.4 "Affiliated Company" or "Affiliated Companies" means
any corporation or other trade or business in which the Company
directly or indirectly owns more than 50 percent of voting
control.
2.5 "Authorized Leave of Absence" means any absence
authorized by the Employer under the Employer's personnel
practices granted in a non-discriminatory manner.
2.6 "Average Monthly Compensation" means the average of
the Compensation received by the Employee while an Employee for a
period of employment for which he received Benefit Service under
Article 2.8 during the 60 consecutive full calendar months
immediately preceding the Participant's Termination of Employment
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divided by 60, as determined in accordance with rules of uniform
application established by the Committee from time to time. For
purposes of this Article 2.6 calendar years and calendar months
immediately preceding a Termination of Employment and immediately
following a reemployment shall be treated as consecutive. If an
Employee has less than 60 such months, the average shall be based
upon the Employee's total compensation for such months divided by
the Employee's number of such months.
2.7 "Beneficiary" means any person other than a
Participant entitled to benefits under the terms of the Plan.
2.8 "Benefit Service" means an Employee's Vesting Service,
provided that:
(a) Not more than 40 years of Benefit Service may be
credited to a Participant;
(b) Any of the provisions herein to the contrary
notwithstanding, an Employee shall be credited with Benefit
Service for Vesting Service through the last day he is an
Employee but shall not be credited with Benefit Service for
Vesting Service earned after ceasing to be an Employee
unless he again becomes an Employee;
(c) An Employee shall not receive Benefit Service
for any time period during which the Employee was receiving
benefits under the Chicago and North Western Railway Company
Long Term Disability Plan (called the Chicago and North
Western Transportation Company Long Term Disability Plan
until May 5, 1994) ("Long Term Disability Plan");
(d) With respect to person's period (or periods) of
employment by an Employer or a Commonly Controlled Entity
during which the person was not an Employee, the amount of
Benefit Service credited for Vesting Service with respect to
such period (or periods) of employment both (1) for any such
period (or periods) of employment after the Effective Date,
and (2) for any person who was not an Employee on the
Effective Date, for any such period (or periods) of
employment shall be limited to a maximum of five (5) years;
(e) A person who becomes an Employee on or after
May 1, 1980, except as provided in Article 2.8(f), shall not
be credited with Benefit Service for Vesting Service earned
for Continuous Service while not an Employee except that
portion of such Vesting Service equal to such Vesting
Service multiplied by a fraction, the denominator of which
is the number of years from the date such person became an
Employee until the later of his Normal Retirement Date or
Termination of Employment, and the numerator of which is
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such person's years of Benefit Service earned for Continuous
Service while an Employee;
(f) A person who, on or after January 1, 1980,
becomes an Employee by virtue of an Employer acquiring
personnel and/or operations of any other corporation, trade
or business, shall receive credit for service as Benefit
Service prior to the date of such acquisition only if, and
to the extent, the Board of Directors so provides; and
(g) A person who has a Parental Leave shall not
receive Benefit Service for periods of such leave.
2.9 "Board of Directors" means the board of directors of
the Company.
2.10 "Committee" means the committee appointed pursuant to
Article 7.1 to administer the Plan.
2.11 "Commonly Controlled Entity" means a corporation,
trade or business if it and an Employer are members of a
controlled group of corporations as defined in Section 414(b) of
the Internal Revenue Code, under common control as defined under
Section 414(c) of the Internal Revenue Code, members of an
affiliated service group as defined in Section 414(m) or members
of a group required to be aggregated under Section 414(o) of the
Internal Revenue Code; provided, however, that solely for the
purposes of Article 12.2(g) and of Section 12.2(q) when used in
the provisions pertaining to Maximum Pensions set forth in
Article 13.8, the standard of control under Sections 414(b) and
414(c) of the Internal Revenue Code shall be deemed to be "more
than 50%" rather than "at least 80%."
2.12 "Company" means the Chicago and North Western Railway
Company (called the Chicago and North Western Transportation
Company until May 5, 1994) or any successor corporation by
merger, consolidation, purchase or otherwise, which elects to
adopt the Plan and the Trust.
2.13 "Compensation" means the total compensation paid to an
Employee by an Employer, determined on accrual basis, for
services rendered to the Employer for the period of time he is an
Employee each Plan Year as reportable on federal income tax
withholding Form W-2 (including pay under the Company's Salary
Continuance Plan), increased by the Employee's Employee Elected
Matched Contributions and Employee Elected Unmatched
Contributions, if any, made under the terms of the Profit Sharing
Plan, attributable to compensation other than bonuses and
incentive compensation, but excluding any income from stock
options or stock appreciation rights benefits (including any
buyouts of option rights by the Company or a Commonly Controlled
Entity), any relocation expenses, bonuses, incentive
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compensation, deferred or contingent compensation or any non cash
compensation reportable on Form W-2. While receiving benefits
under the Chicago and North Western Railway Company Salary
Continuance Plan (called the Chicago and North Western
Transportation Company Salary Continuance Plan until May 5, 1994)
(the "Salary Continuance Plan"), an Employee shall be treated as
receiving Compensation equal to his rate of pay, increased by the
Employee's Employee Elected Matched Contributions and Employee
Elected Unmatched Contributions, if any, made under the terms of
the Profit Sharing Plan, attributable to compensation other than
bonuses and incentive compensation, in effect at the time he
first started receiving such benefits. However, solely for the
purposes of determining the limitations under Article 13.8 and
for purposes of Article XII, Compensation means the total
compensation paid to the Participant by an Employer for the Plan
Year, excluding any Employee Elected Matched Contributions,
Employee Elected Unmatched Contributions benefits under the Plan
or any other qualified plan described in Section 401(a) of the
Internal Revenue Code, or other deferred compensation, stock
options, and any other distribution which receives special tax
benefit. Except for purposes of Article 13.8, the amount of
compensation taken into account for any Plan Year pursuant to
Article 2.13 shall not exceed $200,000 for Plan Years beginning
on or after January 1, 1989 and before January 1, 1994, and
$150,000 for Plan Years beginning on or after January 1, 1994,
adjusted for subsequent years in accordance with Internal Revenue
Code Section 415(d)) (collectively referred to as the
"Compensation Cap"). In determining the Compensation of a
Participant for purposes of this Compensation Cap, the family
member attribution rules of Section 414(q)(6) of the Internal
Revenue Code shall apply, except that in applying such rules, the
term "family" shall include only the spouse of the Participant
and any lineal descendants of the Participant who have not
attained age 19 before the end of the Plan Year.
2.14 "Continuous Service" means the years and fractions of
years of an Employee's last period of employment by an Employer
(or a Commonly Controlled Entity), measured from the date of
employment to the date of Termination of Employment (excluding,
for periods before January 1, 1988, any employment subsequent to
the Employee's Normal Retirement Date); provided that,
(a) if an Employee who has a Termination of
Employment resumes employment with an Employer or a Commonly
Controlled Entity prior to his having a
One-Year-Break-in-Service, such Termination of Employment
shall be disregarded and his employment shall be treated as
continuous through the date he so resumes his employment.
Continuous Service shall also include any other employment
for any other employer or employers which is treated for
purposes of benefits under the Railroad Retirement Act as
continuous service with an Employer;
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(b) any such service (i) for all purposes in the
case of service not for an Employer or Commonly Controlled
Entity and (ii) for all purposes except Vesting Service in
the case of service for an Employer or a Commonly Controlled
Entity with respect to a person who was not an Employee on
January 1, 1979 or which occurs after the Effective Date
during which service such person was a member of a
collective bargaining unit represented by a collective
bargaining agent which was subject to a collective
bargaining agreement shall be limited to not more than 5
years, and, provided further that the Employee provides the
Committee with (1) a statement from such employer or
employers as to the amount of such service and the amount of
the retirement benefits attributable to such service to
which the Employee becomes entitled, or if none, a statement
to that effect or (2) such other evidence as the Committee
in its discretion may determine to be acceptable; and
(c) a person who becomes an Employee by virtue of an
Employer acquiring personnel and/or operations of another
corporation, trade or business on or after January 1, 1980
shall be credited with Continuous Service for service not
with an Employer, an Affiliated Company or a Commonly
Controlled Entity prior to the date of such acquisition only
if, and to the extent, provided by the Board of Directors.
2.15 "Effective Date" means January 1, 1989.
2.16 "Employee" means any employee of an Employer (i) whose
rate of pay is not negotiated under a collective bargaining
agreement, or (ii) whose fringe benefits are not negotiated under
a collective bargaining agreement, excluding leased employees as
defined in Section 414(n)(2) of the Internal Revenue Code and
non-resident aliens employed by an Employer and rendering service
to an Employer outside of the United States.
2.17 "Employer" means the Company or any Affiliated Company
which, pursuant to the provisions of Article 10.1, has adopted
the Plan.
2.18 "ERISA" means the Employee Retirement Income Security
Act of 1974, as from time to time amended.
2.19 "Hour of Service" means each hour for which an
Employee or a leased employee, as defined in Section 416(i) of
the Internal Revenue Code, is paid, or entitled to payment, or
receives earned income from an Employer or a Commonly Controlled
Entity:
(a) for performance of duties;
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(b) on account of a period of time during which no
duties were performed, provided that except as herein
otherwise expressly provided, no more than 501 Hours of
Service shall be credited for any single continuous period
during which an Employee performs no duty, and provided that
no Hours of Service shall be credited for payments made or
due under a plan maintained solely for the purpose of
complying with applicable worker's compensation,
unemployment compensation or disability insurance laws, or
for reimbursement of medical expenses; and
(c) for which back pay, irrespective of mitigation
of damages, is awarded or agreed to by the Employer;
provided that Hours of Service credited under (a) or (b)
shall not be credited under (c).
Hours of Service credited to a Participant for the
performance of duties will be credited to the computation period
in which the duties are performed. The determination of Hours of
Service for reasons other than the performance of duties shall be
made in accordance with the provisions of Labor Department
Regulations Section 2530.200b-2(b), and Hours of Service shall be
credited to the computation periods to which the award or
agreement pertains. Except in the case of an Authorized Leave of
Absence, not more than 501 Hours of Service shall be credited for
any continuous period during which an employee performs no duty
or, in the case of service required to be credited for payments
of back pay awarded or agreed to, for a period during which an
employee did not or would not have performed duties.
To the extent not credited above, for periods of Authorized
Leave of Absence an Employee shall be credited with a number of
Hours of Service for each week of such Authorized Leave of
Absence equal to the Employee's weekly average number of Hours of
Service for the six-week period immediately preceding such
Authorized Leave of Absence.
To the extent not credited above, for periods of absence
from work on account of Parental Leave, as defined in Section
2.23, and solely for the purposes of determining whether he has a
One Year Break In Service and not for other purposes, an Employee
shall be credited with
(1) the Hours of Service which normally would
have been credited to such individual but for the
Parental Leave, or
(2) 8 Hours of Service per day of such absence
if the Plan is unable to determine the Hours of
Service which would have been credited to such
individual but for the Parental Leave.
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An Employee's Hours of Service for absence on account of
Parental Leave shall not exceed the lesser of (1) 501 Hours of
Service or (2) the number of Hours of Service needed to prevent a
One Year Break In Service in the period specified in the
following sentence. Such Hours of Service, if any, shall be
credited to the Plan Year in which absence because of a Parental
Leave commenced except that if such Hours of Service are not
needed to prevent a One Year Break In Service in the Plan Year in
which the absence because of Parental Leave commenced and if such
Parental Leave continues into a subsequent Plan Year, the Hours
of Service shall be credited to the subsequent Plan Year.
For purposes of this Section 2.19 and for Section 12.2(j)
"One Year Break In Service" means a Plan Year within which an
Employee completes not more than 500 Hours of Service.
The following Service Equivalencies shall be applied to
credit each salaried Employee with the number of Hours of Service
which correspond to the payroll period of the Employee for each
payroll period of the Employee for which the Employee receives or
is entitled to receive any compensation:
Payroll Period Hours of Service Credited
Daily 10
Weekly 45
Semi-Monthly 95
Monthly 190
2.20 "Internal Revenue Code" means the Internal Revenue
Code of 1986, as amended, and any subsequent Internal Revenue
Code; if there is a subsequent Internal Revenue Code, any
references herein to Internal Revenue Code sections shall be
deemed to refer to comparable sections of any subsequent Internal
Revenue Code.
2.21 "Normal Retirement Date" means the day on which a
person attains age 65.
2.22 "One-Year-Break-in-Service" means a 12-consecutive
month period commencing with an Employee's Termination of
Employment or with the termination of a prior consecutive
One-Year-Break-in-Service, as applicable, within which Employee
is not employed by an Employer or a Commonly Controlled Entity,
excluding any period of time during which the Employee is
receiving benefits under the Company's Long Term Disability Plan;
provided that an Employee who is absent from work on account of
Parental Leave and who remains absent shall not be deemed to have
had a One-Year-Break-in-Service or the first in a series of
consecutive One-Year-Breaks-in-Service, as applicable, until the
earlier of the third anniversary of the first date the absence on
account of such Parental Leave commenced or the date twelve
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months after the Parental Leave otherwise concludes if the
Parental Leave concludes without the Participant returning to
work with an Employer or Commonly Controlled Entity.
2.23 "Parental Leave" means a period during which an
individual is absent from work for any period:
(a) by reason of the pregnancy of the individual,
(b) by reason of the birth of a child of the
individual,
(c) by reason of the placement of a child with the
individual in connection with the adoption of such child by
such individual, or
(d) for purposes of caring for such child for a
period beginning immediately following such birth or
placement.
An absence from work shall not be a Parental Leave
unless the individual furnishes the Committee such timely
information as may reasonably be required to establish that the
absence from work was for one of the reasons specified above and
the number of days for which there was such an absence. Nothing
contained herein shall be construed to establish an Employer
policy of treating a Parental Leave as an Authorized Leave of
Absence.
2.24 "Participant" means each Employee who is participating
in the Plan pursuant to the provisions of Article III.
2.25 "Pensioner" means a person who, by virtue of having
been a Participant in the Plan, is receiving Retirement Benefits.
2.26 "Plan" means the Chicago and North Western Railway
Company Supplemental Pension Plan (called the Chicago and North
Western Transportation Company Supplemental Pension Plan until
May 5, 1994), as herein set forth, and as hereafter from time to
time amended.
2.27 "Plan Year" means the calendar year.
2.28 "Primary Railroad Retirement Benefit" means the
estimated monthly amount (based upon actual change in the average
wages from year to year as determined by the Social Security
Administration) available at age 65 for the benefit of a retired
Employee (excluding the supplemental annuity and excluding any
benefit available on behalf of a spouse or other dependent) under
the provisions of the Federal Railroad Retirement Act (including
both Tiers I and II) in effect on the date of his Termination of
Employment; provided that within a reasonable time following the
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later of his Termination of Employment and the time when a
Participant is notified of the benefit to which he is entitled,
the Participant may provide documentation of his actual salary
history to the Committee and if he does so and if the Committee
determines that such documentation is sufficient, the
Participant's actual salary history shall be used to determine
the amount of his Primary Railroad Retirement Benefit. If an
Employee has a Termination of Employment prior to age 65, the
amount shall be based upon the assumption that the Employee will
receive, until reaching age 65, compensation which would be
treated as wages for purposes of the Railroad Retirement Act at
the same rate as he received such compensation at the time of
Termination of Employment.
2.29 "Required Beginning Date" means (a) for an employee
who attains age 70-1/2 after December 31, 1987, April 1 (but not
before April 1, 1988) of the calendar year following the calendar
year in which a Participant reaches age 70-1/2, (b) for an
employee who attains age 70-1/2 before January 1, 1988, and who,
with respect to the Plan Year ending in the calendar year in
which he attains age 70-1/2, is not a five percent (5%) owner of
the Employer (as determined under Internal Revenue Code Section
416(i)), April 1 of the calendar year following the later of the
calendar year in which he attains the age of 70-1/2 or in which
he has a Termination of Employment, and (c) for an employee who
attains age 70-1/2 before January 1, 1988 and who, with respect
to the Plan Year ending in the calendar year in which he attains
age 70-1/2 is a five percent (5%) owner of the Employer, April 1
of the calendar year following the later of (1) the calendar year
in which the employee attains age 70-1/2 or (2) the earlier of
(A) the calendar year with or within which ends the plan year in
which the employee becomes a 5 percent (5%) owner, or (B) the
calendar year in which the employee retires.
2.30 "Retirement Benefits" means the benefits payable to a
Participant and, if applicable, the Participant's surviving
spouse under the provisions of the Plan.
2.31 "Termination of Employment" occurs upon the earliest
to occur of the following:
(a) an Employee leaves the employ of an Employer for
any reason;
(b) an Employee fails to report to work within 15
calendar days of notice of recall to work from layoff;
(c) an Employee fails to report for work at the
termination of an Authorized Leave of Absence; or
(d) an Employee is absent due to layoff or
disability, or both, which continues for more than one year
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(e.g. an Employee shall not be treated as having had a
Termination of Employment while receiving benefits under the
Company's Salary Continuance Plan (which provides disability
benefits for up to one year), but an Employee shall be
treated as having a Termination of Employment upon becoming
eligible to receive benefits under the Company's Long Term
Disability Plan (under which benefits commence after an
Employee has been disabled for a consecutive year period)).
Transfers of employment by an Employee from an Employer to
another Employer, an Affiliated Company or Commonly Controlled
Entity, or from one Affiliated Company or Commonly Controlled
Entity to another Affiliated Company, a Commonly Controlled
Entity or to an Employer, shall not constitute a Termination of
Employment of such Employee for purposes of the Plan. Continuous
Service shall not be considered to have been broken by absence of
any Employee due to his having entered the Armed Forces or
Merchant Marine of the United States and who has reemployment
rights under the law and complies with requirements of the law as
to reemployment and is reemployed.
2.32 "Trust" means the legal entity resulting from the
agreement between Company and the Trustee and any amendment
thereto, by which Employer Contributions shall be received, held,
invested and distributed to or for the benefit of Participants
and Beneficiaries.
2.33 "Trust Agreement" means the agreement between the
Company and the Trustee establishing the Chicago and North
Western Railway Company Supplemental Pension Trust (called the
Chicago and North Western Transportation Company Supplemental
Pension Trust until May 5, 1994) and any amendments thereto.
2.34 "Trustee" means the bank or trust company which shall
accept the appointment to execute the duties of the Trustee as
set forth in the Trust Agreement.
2.35 "Trust Fund" means any property, real or personal,
received by the Trustee, plus all income and gains and less
losses, expenses and distributions chargeable thereto.
2.36 "Vesting Service" means the sum of a Participant's
periods of Continuous Service, provided that:
(a) If a Participant has a One-Year-Break-In-
Service, the period of Continuous Service prior to the
One-Year-Break-In-Service shall be excluded until the
Participant has completed one year of Continuous Service
after the One-Year-Break-In-Service;
(b) If a Participant had no vested interest in his
Accrued Benefit prior to a One-Year-Break-In-Service and
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(1) effective for Plan Years commencing before January 1,
1985, if the number of consecutive One-Year-Breaks-In-
Service equals or exceeds the number of years of Vesting
Service before the One-Year-Break-In-Service and
(2) effective for Plan Years commencing after December 31,
1984, if the Participant's number of consecutive One-Year-
Breaks-In-Service equals or exceeds the Participant's number
of years of Vesting Service before a period of five
consecutive One-Year-Breaks-In-Service, Vesting Service
earned prior to the One-Year-Break-In-Service or five
consecutive One-Year-Breaks-In-Service, as applicable, shall
be excluded; provided that a Participant's Vesting Service
which could not be disregarded as of December 31, 1984 under
the rule stated in Section 2.36(b)(1) shall be disregarded
only if it is disregarded under the rule stated in Section
2.36(b)(2);
(c) A person who becomes an Employee on or after
May 1, 1980, except as provided in Article 2.36(d), for all
purposes hereunder except for purposes of determining
Benefit Service pursuant to Article 2.8, shall not be
credited with Vesting Service for Continuous Service except
Continuous Service with an Employer, an Affiliated Company
or a Commonly Controlled Entity;
(d) A person who becomes an Employee by virtue of an
Employer's acquisition of personnel and/or operations of
another corporation, trade or business on or after
January 1, 1980 shall be credited with Vesting Service for
service not with an Employer, Affiliated Company or a
Commonly Controlled Entity prior to such acquisition only
if, and to the extent, the Board of Directors shall provide;
and
(e) If a Participant has a Parental Leave which
continues for more than one year, periods of such Parental
Leave after the first anniversary of the date the leave
commenced shall not be counted as Vesting Service.
ARTICLE 3.
Participation
3.1 Participation. Each Employee shall be a Participant
in the Plan for so long as he remains an Employee, and each
Participant (i) who has completed at least five (5) years of
Vesting Service or who, if the Plan is a Top Heavy Plan, has a
vested interest pursuant to Article 12.3(b) and (ii) who has an
undistributed Accrued Benefit shall continue to be a Participant
after ceasing to be an Employee until he becomes a Pensioner or
he dies. Notwithstanding the foregoing, any person who becomes
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an Employee by virtue of an acquisition by an Employer of
personnel and/or operations of any corporation, trade or business
on or after January 1, 1980 shall not become a Participant,
unless and until the Board of Directors shall so provide.
ARTICLE 4.
Eligibility for the Amount of Retirement Benefits
4.1 Normal Retirement. A person who has reached Normal
Retirement Date, who either is an Employee or is otherwise
employed by an Employer or by an Affiliated Company or Commonly
Controlled Entity shall be entitled to a Normal Retirement
Pension equal to his Accrued Benefit upon Termination of
Employment and proper application in accordance with Article 8.1.
Such pension shall commence with the first full calendar month
following such Termination of Employment if application for
benefits is made not earlier than 90 days prior to such
Termination of Employment and not later than the close of first
full calendar month following such Termination of Employment;
otherwise, it shall commence with any subsequent calendar month
in which application is made (including payments without interest
for each month preceding the month benefits commence for each
month starting with the first full month following such
Termination of Employment).
4.2 Early Retirement. An Employee who has at least five
(5) years of Vesting Service or a former Employee entitled to
benefits under 4.3 who has had a Termination of Employment may,
at his election, become eligible for an Early Retirement Pension
on the first day of any calendar month following his 60th
birthday and prior to his Normal Retirement Date in the amount of
his Accrued Benefit reduced to its Actuarial Equivalent, upon
proper application in accordance with Article 8.1. Such pension
shall commence the first day of the later of the first full
calendar month following such Termination of Employment or the
month in which he attains age 60 if application for benefits is
made not earlier than 90 days prior to such month and not later
than the close of such month; otherwise, it shall commence with
any subsequent calendar month commencing within 90 days after the
month in which application is made.
4.3 Termination with Right to Deferred Pension. An
Employee with at least five (5) years of Vesting Service or, if
the Plan is a Top Heavy Plan, with a vested interest in his
Accrued Benefit pursuant to Article 12.3(b) who has a Termination
of Employment for any reason prior to his Normal Retirement Date,
and who has not fulfilled the requirements of Article 4.1 or 4.2,
shall upon proper application in accordance with Article 8.1 be
entitled to a Deferred Pension (unless thereafter he shall elect
an Early Retirement Pension under Article 4.2) in the amount of
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his Accrued Benefit. Such pension shall commence with the later
of (i) the first full calendar month following the former
Employee's Normal Retirement Date, or (ii) the calendar month in
which he makes application for such pension (including payments
without interest for each full calendar month following his
Normal Retirement Date) unless he elects an Early Retirement
Pension under Article 4.2.
4.4 Death Benefits Prior to Commencement of Retirement
Benefits.
(a) Qualification for Death Benefit. If a
Participant dies prior to the commencement of his Retirement
Benefits and, at the date of the Participant's death, the
Participant (i) has completed not less than five (5) years
of Vesting Service or, if the Plan is a Top Heavy Plan, has
a vested interest in his Accrued Benefit pursuant to
Article 12.3(b) and, in the case of a Participant who died
before August 23, 1984, had remained as an Employee until at
least age 60, and (ii) is survived by a spouse to whom the
Participant has been married for not less than one year, the
Participant's spouse shall receive a Surviving Spouse's
Pension under Article 4.4(b), if the Participant was at
least age 60 as of the date of his death, commencing in the
month following the Participant's death, and, if the
Participant died prior to attaining age 60, commencing in
the month following the date Participant would have attained
age 60 had the Participant survived; provided that if the
Actuarial Equivalent lump sum value of the monthly amount of
such pension is more than $3500, payments shall not commence
before the Participant would have attained his Normal
Retirement Date unless the Participant's surviving spouse
consents to receive the benefit before that date in the
manner provided in Article 5.6.
(b) Surviving Spouse's Pension. The monthly pension
payable to the surviving spouse of a Participant who has
satisfied the requirements of Article 4.4(a) shall be an
amount equal to the amount the spouse would have received,
had the Participant had a Termination of Employment on the
day of his death or, if earlier, on his actual termination
date and commenced to receive a Qualified Joint and Survivor
Pension the day before such Surviving Spouse's Pension
commences and died the day such pension commences.
4.5 Reduction for Other Pensions. If a Participant
receives a pension from any other pension plan, profit sharing
plan, or other retirement or deferred compensation plan other
than the Chicago and North Western Railway Company Profit Sharing
and Retirement Savings Program (called the Chicago and North
Western Transportation Company Profit Sharing and Retirement
Savings Program until May 5, 1994) ("Other Plans"), and if the
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computation of the Participant's Accrued Benefit includes any
years of Benefit Service for any years, which years (the "Common
Years") are also included in determining the Participant's
benefits (or for which the Participant accrued benefits) under
such Other Plans, except as otherwise provided by the Company and
attached as an exhibit to the Plan, the Participant's Accrued
Benefit shall be the Participant's Accrued Benefit, as computed
herein, reduced by the lesser of (i) the Actuarial Equivalent of
such portions of the Participant's benefits from such other plan
as are attributable to the Common Years or (ii) such portions of
the Participant's Accrued Benefit under the Plan as are
attributable to such Common Years, as determined by the
Committee. In determining the amount of reduction for other
benefits pursuant to this Article 4.5, a Participant shall be
treated as receiving or entitled to receive a benefit under
another retirement plan regardless of whether the assets of such
Plan are sufficient to provide the benefits specified thereunder.
4.6 Changes in Railroad Retirement Benefits. Any of the
provisions herein to the contrary notwithstanding, if the Primary
Railroad Retirement Benefits (computed as of any date as though
each Participant had a Termination of Employment on such date) of
Participants are decreased by legislation, rules or regulations,
each Participant's Accrued Benefit shall remain the amount of the
Participant's Accrued Benefit determined on the day immediately
preceding such decrease, and such Accrued Benefit shall not
thereafter increase unless within 180 days after the effective
date of such decrease the Company by action of the Board of
Directors shall otherwise elect.
4.7 Special Early Retirement Benefits.
(a) Those Participants listed in Appendix II who
have voluntarily retired under the Company's July and
August, 1985 Special Early Retirement Incentive Program, who
have at least ten (10) years of Vesting Service and who have
attained 55 years of age shall receive the Special Early
Retirement Benefit as provided in Article 4.7(b).
(b) The Special Early Retirement Benefit shall
consist of (1) and (2):
(1) The greater of the Participant's Accrued
Benefit under Article 2.1 or his Special Accrued
Benefit as defined in this Article 4.7(b)(1). A
Participant's Special Accrued Benefit means a monthly
amount payable to a Participant commencing at the time
specified in Appendix II in the form of a single life
annuity equal to (i) reduced by (ii), (iii) and (iv).
(i) 1-1/2% of the Employee's Special Average
Monthly Compensation multiplied by the
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Employee's years of Special Benefit Service (up
to a maximum of 40 years) reduced by 1/2 of 1%
for each of the first full 60 months that the
annuity starting date precedes Normal Retirement
Date.
(ii) (I) If the Participant has at least 15
years of Vesting Service, 87-1/2% of the
Employee's Primary Railroad Retirement Benefit,
and (II) if the Participant has less than 15
years of Vesting Service, 87-1/2% of the
Participant's Primary Railroad Retirement
Benefit multiplied by a fraction, the numerator
of which is the Participant's years of Vesting
Service and the denominator of which is 15.
Furthermore, in the case of a person who
commences to receive his Special Early
Retirement Benefit after he has attained the age
of 60 but has not yet attained the age on which
he is eligible to receive his Primary Railroad
Retirement Benefit, the amount described in this
Article 4.7(b)(1)(ii) shall be equal to the
amount described in the preceding sentence
reduced by 1/2 of 1% for each of the first full
60 months that the annuity starting dates
precedes his Normal Retirement Date and in the
case of a person who commences to receive his
Special Early Retirement Benefit before he
attains the age of 60, the amount described in
this Article 4.7(b)(1)(ii) shall be equal to the
amount described in the preceding sentence
reduced by 1/15th for each of the first five
years by which the annuity starting date
precedes age 65 and 1/30th for each of the next
five years (or portion of a year) by which the
annuity starting date precedes age 60.
(iii) The Actuarial Equivalent, in the form of
an annuity payable to the Participant for life
commencing on the Participant's Normal
Retirement Date, of the sum of (I) and (II)
below, in the case of a Participant who
commences to receive his Special Early
Retirement Benefit after he has attained the age
of 60 but has not yet attained the age on which
he is eligible to receive his Primary Railroad
Retirement Benefit, reduced by 1/2 of the 1% for
each of the first full 60 calendar months that
the annuity starting date precedes his Normal
Retirement Date and, in the case of a
Participant who commences to receive his Special
Early Retirement Benefit before he attains the
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age of 60, reduced by 1/15th for each of the
first five years by which the annuity starting
date precedes age 65 and 1/30th for each of the
next five years (or portion of a year) by which
the annuity starting date precedes age 60:
(I) The vested part of the Employee's
Employer Contribution Account under the
Chicago and North Western Railway Company
Profit Sharing and Retirement Savings
Program (the "Profit Sharing Plan").
(II) The additional vested amount which
would have been in the Employee's Employer
Contribution Account under the Profit
Sharing Plan had the Employee made
Employee Matched Contributions and
Employee Elected Matched Contributions, as
applicable for the Plan Year, to the
Profit Sharing Plan in the maximum amount
permitted under the Profit Sharing Plan
for each year during which he was a
Participant, determined by assuming that
such additional amounts would have
consisted of an amount that was the same
percentage of the Participant's Employee
Matched Contributions and Employee Elected
Matched Contributions, as applicable under
the Profit Sharing Plan for each such year
as Participants in the Profit Sharing Plan
actually received in each such year, plus
an amount equal to a participation in
earnings, gains and losses for each year
equal to the average annual earnings,
gains and losses of all assets of the
Profit Sharing Plan for each year.
(iv) The Actuarial Equivalent, in the form of
an annuity payable to the Participant for life
commencing on the Participant's Normal
Retirement Date, of the vested part of the
Participant's Profit Sharing Excess Benefit
Account under the Chicago and North Western
Transportation Company Excess Benefit Retirement
Plan ("Excess Benefit Plan"), in the case of a
Participant who commences to receive his Special
Early Retirement Benefit after he has attained
the age of 60 but has not yet attained the age
on which he is eligible to receive his Primary
Railroad Retirement Benefit, reduced by 1/2 of
the 1% for each of the first full 60 calendar
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months that the annuity starting date precedes
his Normal Retirement Date and, in the case of a
Participant who commences to receive his Special
Early Retirement Benefit before he attains the
age of 60, reduced by 1/15th for each of the
first five years by which the annuity starting
date precedes age 65 and 1/30th for each of the
next five years (or portion of a year) by which
the annuity starting date precedes age 60.
(v) The amounts under Articles
4.7(b)(1)(iii)(I), 4.7(b)(1)(iii)(II) and
4.7(b)(1)(iv) shall be valued as of the
Valuation Date or Accounting Date immediately
preceding the date of a Participant's
Termination of Employment excluding the
Participant's share of Employer contributions
and Remainders, if any, in the Profit Sharing
Plan and the Excess Benefit Plan, for the year
in which such termination occurs.
(vi) In the case of a Participant who is
married as of the date his Special Early
Retirement Benefit is to commence, the benefit
provided under Section 4.7(b)(1) shall be paid
only if the Participant's spouse shall consent
to the Participant's election to receive an
early retirement pension in accordance with the
provisions of Article 5.6.
(2) An annuity paid to each Participant listed
in Appendix II who is less than 60 years of age on
July 1, 1985, commencing on the date specified in
Appendix II in the amount of the Participant's monthly
estimated primary railroad retirement benefit payable
at the earliest date on which he is eligible to
receive his primary railroad retirement benefit
commencing on the first day of the calendar month
following the Participant's Termination of Employment
and ending at the earlier of the end of the calendar
month before the month in which the Participant is
first eligible to receive his primary railroad
retirement benefit or the month of the Participant's
death ("Railroad Retirement Supplement").
(c) (1) A Participant's "Special Average Monthly
Compensation" means, if the Participant is less than
60 years of age, the average of the monthly
Compensation the Employee would have received for the
60 months prior to the month in which he attained age
60 if he received his actual Compensation for the
months before his Termination of Employment and
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received his rate of pay as of the date of his
Termination of Employment for each month between the
month of his Termination of Employment and the month
in which he attained age 60 and, if the Participant is
at least 60 years of age, his Average Monthly
Compensation.
(2) A Participant's "Special Benefit Service"
means, if the Participant is less than 60 years of
age, his years of Benefit Service at his Termination
of Employment plus the additional years of Benefit
Service the Participant would have if he remained an
Employee and a Participant until he attained the age
of 60 and, if the Participant is at least 60 years of
age, his years of Benefit Service; provided that not
more than 40 years of Special Benefit Service may be
credited to a Participant.
4.8 No Duplication of Benefits. A person shall not
simultaneously receive benefits under more than one of the
foregoing Sections of Article IV.
4.9 Payment of Profit Sharing Plan Benefits. If all or a
portion of a vested Member's Net Balance Account under the
Chicago and North Western Railway Company Profit Sharing and
Retirement Savings Program (called the Chicago and North Western
Transportation Company Profit Sharing and Retirement Savings
Program until May 5, 1994) is to be paid in the form of a
Qualified Joint and Survivor Pension, as defined in subsection
2.46 thereof (which includes a single life annuity payable to the
member for life) or a Surviving Spouse's Pension as defined in
subsection 2.54 thereof, the portion of the Member's Net Balance
Account to be so paid shall be transferred to the Plan as
provided in subsection 5.5 of the Chicago and North Western
Railway Company Profit Sharing and Retirement Savings Program
(called the Chicago and North Western Transportation Company
Profit Sharing and Retirement Savings Program until May 5, 1994).
The amount so transferred shall be converted into a benefit in
the form of a single life annuity payable to the Participant on
the annuity starting date using the mortality assumptions
specified in Appendix I Part (a) and the interest rate
assumptions specified in Appendix I, Part (b)(i). Any such
benefit shall be paid in a form permitted in accordance with the
provisions of Article V commencing as of the date of transfer.
If in accordance with Article 5.1 such benefit is paid in a form
other than a single life annuity, the benefit paid shall be the
Actuarial Equivalent of such single life annuity determined in
accordance with the mortality assumptions specified in
Appendix I, Part (a) and the interest rate assumptions specified
in Appendix I, Part (b)(iii). If such benefit commences to be
paid on a date before the Normal Retirement Date, the amount
payable shall be the Actuarial Equivalent of the benefit payable
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at Normal Retirement Date determined in accordance with the last
sentence of Appendix I.
ARTICLE 5.
Form and Payment of Retirement Benefits
5.1 Normal Period of Payment. Retirement Benefits under
the Plan shall commence as of the month specified in the
applicable provisions in Article IV. Retirement Benefits shall
be payable as follows:
(a) A Participant who is married on the date on
which Retirement Benefits commence shall receive
Retirement Benefits in the form of a Qualified Joint
and Survivor Pension unless the Participant (in the
case of Retirement Benefits which commence after
December 31, 1984, with his spouse's consent in
accordance with Article 5.6) elects not to receive a
Qualified Joint and Survivor Pension in accordance
with Article 5.1(a)(ii).
(i) A Qualified Joint and Survivor Pension is
a monthly pension payable to the Participant for
life and, upon the Participant's death, if the
Participant's spouse survives the Participant, a
monthly pension payable to the Participant's
spouse for life equal to 50% of the pension
previously payable to the Participant. The
amount of such Qualified Joint and Survivor
Pension shall be the Actuarial Equivalent of
such Participant's Accrued Benefit or Special
Accrued Benefit, as applicable.
(ii) A Participant to whom Retirement Benefits
would be payable in the form of a Qualified
Joint and Survivor Pension pursuant to this
Article 5.1 shall have the right to waive a
Qualified Joint and Survivor Pension by
delivering written notice to the Committee (in
the case of Retirement Benefits which commence
after December 31, 1984, consented to by the
Participant's spouse in accordance with
Article 5.6) at any time prior to the first day
of the calendar month in which his Retirement
Benefits initially commence. No less than 30
days and no more than 90 days before the first
day of the first month which a benefit is
payable as an annuity and in accordance with
such regulations as the Secretary of the
Treasury may prescribe, the Committee shall
-22-
provide each Participant with a written
explanation of the following:
(A) the terms and conditions of the
Qualified Joint and Survivor Pension,
(B) the Participant's right to make
(within the 90 day period before the annuity
starting date) and the effect of an election to
waive the Qualified Joint and Survivor Pension,
(C) in the case of Retirement Benefits
which commence after December 31, 1984, the
rights of the Participant's spouse to consent to
the Participant's election to waive the
Qualified Joint and Survivor Pension and the
effect of consenting to such waiver, and
(D) the Participant's right to make, and
the effect of, a revocation of an election to
waive the Qualified Joint and Survivor Pension.
(b) A Participant who is not married on the date on
which Retirement Benefits commence or who has elected not to
receive a Qualified Joint and Survivor Pension, in the case
of Retirement Benefits which commence after December 31,
1984 with the consent of his spouse in accordance with
Article 5.6 shall receive Retirement Benefits in the form of
a monthly pension payable to the Participant during his
lifetime, which terminates the month following the
Participant's death ("Single Life Annuity").
(c) A Participant who is eligible to receive a
Railroad Retirement Supplement as provided in Article
4.7(b)(2) shall receive such benefit in the form of (1) a
monthly annuity commencing on the date specified in Appendix
II and ending at the earlier of the end of the calendar
month before the month in which the Participant is first
eligible to receive his Primary Railroad Retirement Benefit
or the month of the Participant's death and (2) if a
Participant dies and is survived by the spouse to whom he
was married at the time of his Termination of Employment,
such surviving spouse shall be paid a monthly annuity equal
to 50% of the monthly amount of the benefit received by the
Participant commencing in the first full calendar month
after the Participant's death and ending at the earlier of
the end of the calendar month before the month in which the
Participant, had he survived, would have been eligible to
first receive his Primary Railroad Retirement Benefit or the
month of the surviving spouse's death.
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5.2 Facility of Payment. All Retirement Benefits shall be
paid to the payee either by a check which shall be endorsed
personally by the payee or, if the payee makes a written request
on a form approved by the Committee, by a deposit in the personal
savings or checking account of the payee; provided that if any
such payment or deposit shall be made in error or in excess of
the amount due, the payee shall be liable to return any such
payment or deposit or excessive portion of any payment or
deposit. If in the opinion of the Committee, any person to whom
benefits are payable is unable to care for his affairs because of
illness, accident or other incapacity, any payment due (unless
prior claim therefor shall have been made by a duly qualified
legal representative) may be paid for his benefit to his spouse,
parent, child, brother or sister, or to any other person as the
Committee may from time to time determine. If any payment due
any person under this Plan is unpaid at the time of the payee's
death, the Committee may determine the person equitably entitled
thereto to whom the payment shall be made (unless prior claim
therefor shall have been made by a duly qualified legal
representative prior to distribution). Any such payment under
this Article 5.2 shall, to the extent thereof, be a complete
discharge of any liability therefor.
5.3 Effect of Return of Benefit Checks. Each person
entitled to benefits under this Plan shall furnish the Committee
with the address to which his benefit checks all be mailed. If
any benefit check mailed by regular United States mail to the
last address appearing on the Committee's records is returned
because the addressee is not found at that address, the mailing
of benefit checks shall stop. Thereafter, if the Committee in a
manner satisfactory to the Committee receives written notice of
the proper address of the person entitled to receive such benefit
checks and is furnished with evidence satisfactory to the
Committee that such person is living, all amounts then due shall
be forwarded to such person at such address.
5.4 Effect of Continuing in or Resuming Employment. A
Participant who (a) continues in employment with an Employer
after his Normal Retirement Date or (b) is reemployed by an
Employer after beginning to receive Retirement Benefits under the
Plan, shall, subject to Section 5.5(b), have payment of his
Retirement Benefits suspended for each calendar month of such
employment or reemployment in which he is paid or entitled to
payment for an hour or more of service performed on each of 8 or
more days during such month. Any Benefit payments for such month
shall not thereafter be payable to such person. A person whose
Retirement Benefits are so suspended shall be given notice
thereof. If Benefit payments are made to a Participant for a
calendar month in which payments should have been suspended
hereunder, the amount of such payments may be offset against all
or any part of any subsequent payments. However, beginning with
the fourth full calendar month following the end of such
-24-
suspension, such offset shall not exceed 25% of the amount of any
payment for any calendar month. If the Employee subsequently
retires, the Employee shall commence (or recommence) receiving
Retirement Benefits based on his Accrued Benefit, reduced by the
Actuarial Equivalent of any Retirement Benefits paid to the
Employee prior to Employee's Normal Retirement Date.
5.5 Commencement of Benefits. Any provision herein to the
contrary notwithstanding, upon application for Retirement
Benefits in accordance with Article 8.1, payment of Retirement
Benefits shall commence not later than the earlier of
(a) the sixtieth (60th) day after the latest of the
close of the Plan Year in which (1) the Participant reaches
Normal Retirement Date, (2) occurs the tenth (10th)
anniversary of the year in which the Participant commenced
participation in the Plan, or (3) the Participant has a
Termination of Employment; or
(b) the Required Beginning Date.
5.6 Spousal Consents.
(a) A valid spouse's consent to the waiver of a
Qualified Joint and Survivor Pension shall be:
(1) in a writing acknowledging the effect of
the consent;
(2) signed by the Participant's spouse and
witnessed by a notary public; and
(3) effective only for a spouse who gives the
consent.
However, the consent of a Participant's spouse shall not be
required if it is established to the satisfaction of a Plan
representative that such consent may not be obtained because
there is no spouse, or because the spouse cannot be located
or because of such other circumstances as the Secretary of
the Treasury may by regulations prescribe.
If the Participant's spouse at the time payment of his
Retirement Benefit commences consents to the payments, it
shall not be necessary to obtain the consent of any
subsequent spouse of the Participant to the continuance of
such payments.
(b) To the extent provided in any Qualified Domestic
Relations Order (as defined in Section 414(p) of the
Internal Revenue Code) if married to the Participant for at
least one year, the former spouse of a Participant shall be
-25-
treated as the surviving spouse of such Participant for
purposes of receiving a Qualified Joint and Survivor Pension
and for providing a valid consent in accordance with this
Article 5.6.
5.7 Eligible Rollover Distributions.
(a) This Section applies to distributions made on or
after January 1, 1993. Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a
distributee's election under this Section, a distributee may
elect, at the time and in the manner prescribed by the Plan
Administrator, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan
specified by the distributee in a direct rollover; provided,
however, that an eligible rollover distribution of less than
$200 shall not be eligible for a direct rollover.
(b) Definitions.
(i) "Eligible rollover distribution":
An eligible rollover distribution is any distribution
of all or any portion of the balance to the credit of
the distributee, except that an eligible rollover
distribution does not include: any distribution that
is one of a series of substantially equal periodic
payments (not less frequently than annually) made for
the life (or life expectancy) of the distributee or
the joint lives (or joint life expectancies) of the
distributee and the distributee's designated
beneficiary, or for a specified period of ten years or
more; any distribution to the extent such distribution
is required under Section 401(a)(9) of the Internal
Revenue Code; and the portion of any distribution that
is not includible in gross income.
(ii) "Eligible retirement plan": An
eligible retirement plan is an individual retirement
account described in Section 408(a) of the Internal
Revenue Code, an individual retirement annuity
described in Section 408(b) of the Internal Revenue
Code, an annuity plan described in Section 403(a) of
the Internal Revenue Code, or a qualified trust
described in Section 401(a) of the Internal Revenue
Code, that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible
rollover distribution to the surviving spouse, an
eligible retirement plan is an individual retirement
account or individual retirement annuity.
(iii) "Distributee": A distributee
includes an employee or former employee. In addition,
-26-
the employee's or former employee's surviving spouse
and the employee's or former employee's spouse or
former spouse who is the alternate payee under a
qualified domestic relations order, as defined in
Section 414(p) of the Internal Revenue Code, are
distributees with regard to the interest of the spouse
or former spouse.
(iv) "Direct rollover": A direct
rollover is a distribution by the Plan made payable to
the trustee of the eligible retirement plan specified
by the distributee.
5.8 Deduction of Taxes from Amounts Payable and Mandatory
Withholding on Certain Eligible Rollover Distributions.
(a) The Trustee may deduct from the amount to
be distributed such amount as the Trustee, in its sole
discretion, deems proper to protect the Trustee and
the Trust against liability for the payment of death,
succession, inheritance, income, or other taxes, and
out of the money so deducted, the Trustee may
discharge any such liability and pay the amount
remaining to the Participant, the Beneficiary or the
deceased Participant's estate, as the case may be.
(b) In the case of an Eligible Rollover
Distribution that is subject to the income tax
withholding of Section 3405(c) of the Code, if
property (other than employer securities) is
distributed and the cash in the distribution is not
sufficient to satisfy the withholding obligation, the
Plan Administrator can sell the property or receive
cash from the Participant in amounts sufficient to pay
the withholding.
(c) The Administrator will not be liable for
failing to withhold on an Eligible Rollover
Distribution that is not in fact paid to an Eligible
Retirement Plan if the Administrator reasonably relied
on adequate information provided by the Participant
who elected the direct rollover. For purposes of the
foregoing provision, adequate information includes the
name of the recipient plan, a representation that the
recipient plan is an Eligible Retirement Plan, and any
other information necessary to accomplish the direct
rollover by the means selected for delivery.
-27-
ARTICLE 6.
Plan Financing
6.1 Funding Policy. The Committee shall establish and
direct the implementation of a funding policy and method for the
Plan which shall be consistent with the objectives of the Plan
and with the Minimum Funding Standards established under Section
412 of the Internal Revenue Code. The Committee may in its
discretion rely upon the advice of the Actuary in establishing
and carrying out a funding policy and method.
6.2 Contributions. Each Employer shall make contributions
to the Trust Fund to fund benefits of the Plan for its Employees
in such amounts and at such times as the Committee determines, in
accordance with the funding policy and method of the Plan, shall
be made not later than the due date for the Employer's United
States income tax return (including extensions) for the year for
which such contribution is made. No contributions shall be made
under the Plan by any Participant. All Employer Contributions
are expressly conditioned upon the qualification of the Plan
under Section 401(a) of the Internal Revenue Code and upon the
deductibility of such contributions by the Employer under
Section 404 of the Internal Revenue Code.
6.3 Forfeitures. Forfeitures of benefits under the Plan
arising for any reason shall be applied to reduce the cost of the
Plan under the funding policy and method of the Plan and shall
not increase the benefits under the Plan otherwise payable to
Participants.
6.4 Exclusive Benefit of Participants. All Employer
Contributions under the Plan shall be paid to the Trustee and
deposited in the Trust Fund and shall be held, managed and
distributed solely in the interest of the Participants and
Beneficiaries for the exclusive purpose of (1) providing benefits
to Participants and Beneficiaries and (2) defraying reasonable
administrative expenses of the Plan and the Trust, to the extent
such expenses are not paid by the Employers, provided that:
(a) If, and to the extent, deduction for an Employer
Contribution under Section 404 of the Internal Revenue Code
is disallowed, Employer Contributions conditioned upon
deductibility shall be returned to the Employer within one
year after the disallowance of the deduction;
(b) If, and to the extent, an Employer Contribution
is made through mistake of fact, such Employer Contribution
shall be returned to the Employer within one year of the
payment of the contribution; and
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(c) If any amounts remain in the Trust Fund after
termination of the Plan and satisfying all liabilities of
the Plan to Participants, Pensioners and Beneficiaries, such
amounts shall be distributed to the Employers in such
amounts as the Committee in its sole discretion shall
determine.
6.5 Benefits Payable Only From Trust Fund. All Benefits
provided by this Plan shall be paid solely out of the Trust Fund,
and neither any Employer nor any agent or representative of an
Employer shall be liable in any manner for any such benefits.
ARTICLE 7.
Administration
7.1 Board of Directors Duties. The Board of Directors
shall have overall responsibility for the establishment,
amendment, termination, administration and operation of the Plan
and the investment of its assets, which responsibility it shall
discharge:
(a) by the appointment and removal (with or without
cause) of
(1) the members of the Committee, to which is
delegated the overall responsibility for the
interpretation, administration and operation of the
Plan;
(2) the Trustee, to which is delegated the
responsibility for the investment and safekeeping of
the assets of the Plan, except to the extent such
responsibility is delegated to one or more Investment
Managers; and
(3) if and to the extent it deems appropriate,
one or more Investment Managers to whom it may
delegate responsibility for the investment of all or
any part of the assets of the Plan; and
(b) by establishing and communicating to the Trustee
and any Investment Managers investment objectives and
guidelines, periodically reviewing and monitoring the
performance of the Committee, Trustee and any Investment
Managers.
7.2 Committee Membership. The Committee shall consist of
not less than three members, who shall be appointed by the Board
of Directors. They shall remain in office at the will of the
Board of Directors, and the Board of Directors may from time to
-29-
time remove any of said members with or without cause and shall
appoint their successors. The Committee shall have the general
responsibility for the administration of the Plan and for
carrying out its provisions, and shall be the Plan Administrator.
7.3 Committee Structure. Each member of the Committee
shall be an officer or Employee of an Employer hereunder. Each
person upon becoming a member of the Committee, shall file an
acceptance thereof in writing with the secretary of the Company
and the secretary of the Committee. Any member of the Committee
may resign by delivering his written resignation to the secretary
of the Company and the secretary of the Committee, and such
resignation shall become effective upon the date specified
therein. In the event of a vacancy in membership, the remaining
members shall constitute the Committee with full power to act
until said vacancy is filled.
7.4 Committee Actions. The action of the Committee shall
be determined by the vote or other affirmative expression of a
majority of its members. The Committee shall choose a chairman
who shall be a member of the Committee and a secretary who may
(but need not) be a member of the Committee. The secretary shall
keep a record of all meetings and acts of the Committee and shall
have custody of all records and documents pertaining to its
operations. Either the chairman or the secretary may execute any
certificate or other written direction on behalf of the
Committee.
7.5 Committee Duties. The Committee on behalf of the
Participants, Pensioners and all other Beneficiaries of the Plan
and Trust shall enforce the Plan in accordance with the terms of
the Plan and the Trust Agreement and shall have all powers
necessary to accomplish that purpose, including but not by way of
limitation, the following:
(a) To issue rules and regulations necessary for the
proper conduct and administration of the Plan and to change,
alter, or amend such rules and regulations;
(b) To construe and interpret the Plan and Trust
Agreement;
(c) To determine all questions arising in its
administration, including those relating to the eligibility
of persons to become Participants; the rights of
Participants, Pensioners and their Beneficiaries, and
Employer Contributions; the amount and manner of accruals
and distribution of benefits hereunder; and its decision
thereon shall be final and binding upon all persons
hereunder;
-30-
(d) To compute and certify to the Trustee the amount
and kind of benefits payable to Participants, Pensioners or
their Beneficiaries;
(e) To authorize all disbursements of the Trustee
from the Trust Fund;
(f) To employ and suitably compensate such
actuaries, accountants and attorneys (who may but need not
be the actuaries, accountants or attorneys of the Company),
other persons to render advice and clerical employees as it
may deem necessary to the performance of its duties;
(g) To communicate the Plan and its eligibility
requirements to the Employees and to notify Employees when
they become eligible to participate; and
(h) To make available to Participants upon request,
for examination during business hours, such records as
pertain exclusively to the examining Participant.
7.6 Committee Liability. The Committee and the members
thereof shall be free from all liability, joint or several, for
their acts as members of such Committee, except to the extent
that they may have been guilty of willful misconduct, except as
otherwise required by federal law.
7.7 Committee Bonding. The members of the Committee shall
serve without bond (except as otherwise required by federal law)
and without compensation for their service as such, but all
expenses of the Committee shall be paid by the Trust except to
the extent paid by the Employers.
7.8 Allocations and Delegations of Responsibility.
(a) The Board of Directors and the Committee shall
have the authority to delegate from time to time, by
instrument in writing filed in its minute books, all or any
part of its responsibilities under the Plan to such person
or persons as it may deem advisable (and may authorize such
person, upon receiving the written consent of the Board of
Directors or the Committee, to delegate such
responsibilities to such other person or persons as the
Board of Directors or the Committee shall authorize), and in
the same manner to revoke any such delegation of
responsibility. Any action of the delegate in the exercise
of such delegated responsibility shall have the same force
and effect for all purposes hereunder as if such action had
been taken by the Board of Directors or the Committee. An
Employer, the Board of Directors and the Committee shall not
be liable for any acts or omissions of any such delegate.
The delegate shall periodically report to the Board of
-31-
Directors or the Committee concerning the discharge of the
delegated responsibilities.
(b) The Board of Directors and Committee shall have
the authority to allocate from time to time, by instrument
in writing filed in its minute books, any part of its
responsibilities under the Plan to one or more of its
members as it may deem advisable, and in the same manner to
revoke such allocation of responsibilities. Any action of
the member to whom responsibilities are allocated in the
exercise of such allocated responsibilities shall have the
same force and effect for all purposes hereunder as if such
action had been taken by the Board of Directors or the
Committee. An Employer, the Board of Directors and the
Committee shall not be liable for any acts or omissions of
such member. The member to whom responsibilities have been
allocated shall periodically report to the Board of
Directors or the Committee concerning the discharge of the
allocated responsibilities.
7.9 Information to Be Supplied by Employers. Employers
shall provide the Committee or its delegate with such information
as it shall from time to time need in the discharge of its
duties.
7.10 Validity of Records. The regularly kept records of
the Committee, Company and any Employer shall be conclusive
evidence of the Vesting Service and Benefit Service of an
Employee, his Compensation, his age, his status as an Employee,
the amount of his benefits under the Chicago and North Western
Railway Company Profit Sharing and Retirement Savings Program
(called the Chicago and North Western Transportation Company
Profit Sharing and Retirement Savings Program until May 5, 1994)
determined under Article 2.1(c) and 4.7(b)(1)(iii) hereof and all
other matters contained therein applicable to this Plan provided
that an Employee may request a correction in the records of his
age at any time prior to retirement, and such correction shall be
made if within 90 days after such request he furnishes his
support thereof -- birth certificate, baptismal certificate, or
other documentary proof of age -- satisfactory to the Committee.
7.11 Fiduciary Capacity. Any person or group of persons
may serve in more than one fiduciary capacity with respect to the
Plan.
7.12 Company as Agent. The Company and/or the Committee
shall act as agent for each Employer in the administration of the
Plan.
7.13 Fiduciary as Participant. A fiduciary who is also a
Participant or a Beneficiary shall receive any benefit to which
he may be entitled as a Participant or Beneficiary in the Plan so
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long as such benefit is computed and paid on a basis that is
consistent with the terms of the Plan as applied to all other
Participants and Beneficiaries.
7.14 Fiduciary Responsibility. If a Plan fiduciary acts in
accordance with ERISA, Title I, Subtitle B, Part 4:
(a) in relying on a Participant's election to waive
a Qualified Joint and Survivor Annuity or a revocation of
such an election or in determining that the Participant's
spouse has consented to a waiver or that the consent of the
Participant's spouse may not be obtained because there is no
spouse, the spouse cannot be located or other circumstances
prescribed by the Secretary of the Treasury by regulations,
then to the extent of payments made pursuant to such
consent, revocation or determination, the Plan and its
fiduciaries shall have no further liability.
(b) in treating a domestic relations order as being
(or not being) a Qualified Domestic Relations Order, or,
during any period in which the issue of whether a domestic
relations order is a Qualified Domestic Relations Order is
being determined (by the Committee, by a court of competent
jurisdiction, or otherwise), in segregating in a separate
account in the Plan or in an escrow account the amounts
which would have been payable to the alternate payee during
such period if the order had been determined to be a
Qualified Domestic Relations Order, in paying the amounts
segregated or held in escrow to the person entitled thereto
if within 18 months the domestic relations order (or a
modification thereof) is determined to be a Qualified
Domestic Relations Order, in paying such amounts to the
person entitled thereto if there had been no order, if
within 18 months the domestic relations order is determined
not to be qualified or if the issue is not resolved within
18 months and in prospectively applying a domestic relations
order which is determined to be qualified after the close of
the 18-month period, then the obligation of the Plan and its
fiduciaries to the Participant and each alternate payee
shall be discharged to the extent of any payment made
pursuant to such acts.
ARTICLE 8.
Claims Procedure
8.1 Initial Claim for Benefits. Each Participant,
Pensioner or other Beneficiary (a "Claimant") may submit his
claim for benefits to the Committee (or to such other person or
persons as may be designated by the Committee) in writing in such
-33-
form as is provided or approved by the Committee. A Claimant
shall have no right to seek review of a denial of benefits, or to
bring any action in any court to enforce a claim for benefits
prior to his filing a claim for benefits and exhausting his
rights to review under Articles 8.1 and 8.2.
When a claim for benefits has been filed properly,
such claim for benefits shall be evaluated and the Claimant shall
be notified of the approval or the denial within ninety (90) days
after the receipt of such claim unless special circumstances
require an extension of time for processing the claim. If such
an extension of time for processing is required, written notice
of the extension shall be furnished to the Claimant prior to the
termination of the initial ninety (90) day period which shall
specify the special circumstances requiring an extension and the
date by which a final decision will be reached (which date shall
not be later than one hundred eighty (180) days after the date on
which the claim was filed). A Claimant shall be given a written
notice in which the Claimant shall be advised as to whether the
claim is granted or denied, in whole or in part. If a claim is
denied, in whole or in part, the Claimant shall be given written
notice which shall contain (1) the specific reasons for the
denial, (2) references to pertinent plan provisions upon which
the denial is based, (3) 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 (4) the
Claimant's rights to seek review of the denial.
8.2 Review of Claim Denial. If a claim is denied, in
whole or in part, the Claimant shall have the right to request
that the Committee review the denial, provided that the Claimant
files a written request for review with the Committee within
sixty (60) days after the date on which the Claimant received
written notification of the denial. A Claimant (or his duly
authorized representative) may review pertinent documents and
submit issues and comments in writing to the Committee. Within
sixty (60) days after a request for review is received, the
review shall be made and Claimant shall be advised in writing of
the decision on review, unless special circumstances require an
extension of time for processing the review, in which case the
Claimant shall be given a written notification within such
initial sixty (60) day period specifying the reasons for the
extension and when such review shall be completed (provided that
such review shall be completed within one hundred and twenty
(120) days after the date on which the request for review was
filed). The decision on review shall be forwarded to the
Claimant in writing and shall include specific reasons for the
decision and references to plan provisions upon which the
decision is based. A decision on review shall be final and
binding on all persons for all purposes. If a Claimant shall
fail to file a request for review in accordance with the
procedures described in Articles 8.1 and 8.2, such Claimant shall
-34-
have no right to review and shall have no right to bring an
action in any court and the denial of the claim shall become
final and binding on all persons for all purposes.
ARTICLE 9.
Trustee and Trust Fund
9.1 Trust Agreement. The Company has entered into a Trust
Agreement providing for the administration of the Chicago and
North Western Railway Company Supplemental Pension Trust (called
the Chicago and North Western Transportation Company Supplemental
Pension Trust until May 5, 1994). Said Trust Agreement as from
time to time amended shall continue in force and shall be deemed
to form a part of this Plan, and any and all rights or benefits
which may accrue to any person under this Plan shall be subject
to all the terms and provisions of the said Trust Agreement.
9.2 Selection of Trustee. As provided in the Trust
Agreement, the Board of Directors shall have the power to remove
the Trustee and to appoint a successor Trustee.
9.3 Trustee's Duties. The powers, duties and
responsibilities of the Trustee shall be as stated in the Trust
Agreement, and nothing contained in this Plan either expressly or
by implication shall be deemed to impose any additional powers,
duties or responsibilities upon the Trustee. All Employer
Contributions shall be paid into the Trust and all benefits
payable under the Plan shall be paid from the Trust. No Employer
shall have any rights or claims of any nature in or to the assets
of the Trust Fund except the right to require the Trustee to
hold, use, apply and pay such assets, in accordance with the
directions of the Committee, for the exclusive benefit of the
Participants and their Beneficiaries, except as otherwise
provided in Article 6.4.
9.4 Trust Income. The net income derived from the Trust
shall be accumulated and shall from time to time be invested as a
part of the Trust Fund.
9.5 Expenses. All clerical, legal and other expenses of
the Plan and the Trust and Trustee's fees shall be paid by the
Trust except to the extent paid by the Employers.
9.6 Trust Entity. The Trust under this Plan from its
inception shall be a separate entity aside and apart from
Employers or their assets. The Trust and the corpus and income
thereof shall in no event and in no manner whatsoever be subject
to the rights or claims of any creditor of any Employer.
-35-
ARTICLE 10.
Affiliated Companies
10.1 Procedure for Adoption. Any Affiliated Company may,
by resolution of such Affiliated Company's board of directors,
adopt the Plan for the benefit of its employees upon
authorization of such action by the Board of Directors subject to
such terms and conditions (including but not limited to terms and
conditions concerning Vesting Service, Benefit Service, and
amount of Retirement Benefits) as may be imposed by the Board of
Directors.
10.2 Termination by Affiliated Company. Any Affiliated
Company may, by resolution of the board of directors of such
Affiliated Company, with the consent of the Board of Directors
and subject to such conditions as may be imposed by the Board of
Directors, terminate the Plan as to such Affiliated Company. If
any Affiliated Company shall terminate the Plan as to itself, the
portion of the Trust Fund attributable to the Employees of such
Affiliated Company shall be determined on the basis of records of
contributions, benefit payments, expenses and similar items,
maintained by or on behalf of the Company and/or the Committee
(or such other means as the Committee, with the advice of the
Actuary, shall deem appropriate), and such portion of the Trust
Fund shall be distributed to such Affiliated Company's
Pensioners, surviving spouses of such Affiliated Company's
Employees, such Affiliated Company's Employees and former
Employees (other than Employees whose employment is transferred
to an Employer, or to another Affiliated Company), as provided in
Articles 11.2 and 11.3 with respect to termination of the Plan by
the Company.
ARTICLE 11.
Amendment and Termination
11.1 Amendments. The Company, by resolution of the Board
of Directors, may amend, modify, change, revise or discontinue
this Plan at any time; provided, however, (a) that no amendment
shall increase the duties or liabilities of the Trustee, or the
Committee, without their written consent; (b) that no amendment
shall have the effect of vesting in any Employer any interest in
any funds, securities or other property subject to the terms of
this Plan and the Trust Agreement; (c) that no amendment shall
authorize or permit at any time any part of the corpus or income
of the Trust Fund to be used or diverted to purposes other than
for the exclusive benefit of participants and their
Beneficiaries; (d) that, except as provided in Article 11.3, no
amendment shall have any retroactive effect as to deprive any
-36-
Participant or Beneficiary of any benefit already accrued or,
except to the extent permitted in regulations and rulings issued
by the Secretary of the Treasury, to eliminate with respect to a
benefit already accrued an optional form of benefit; provided
that no amendment made in conformance to provisions of the
Internal Revenue Code, or any other statute relating to
employees' trusts, or any official regulations or ruling issued
pursuant thereto, shall be considered prejudicial to the rights
of any Participant or Beneficiary.
11.2 Termination. It is the expectation of the Company
that it will continue the Plan and the payment of contributions
hereunder indefinitely, but the continuation of the Plan and the
payment of the Employer Contributions hereunder is not assumed as
a contractual obligation of the Company or any other Employer;
and the right is reserved by the Company or any other Employer at
any time to reduce, suspend or discontinue its contributions
hereunder, provided, however, that the Employer Contributions for
any Plan Year accrued or determined prior to the end of said year
shall not after the end of said year be retroactively reduced,
suspended or discontinued.
11.3 Disposition of Fund on Termination. Subject to the
provisions of Section 13.8, upon termination of the Plan, the
Trust Fund shall be liquidated by making provisions (if not
already so provided) for payments, after providing for the
expenses of the Plan and Trust Fund, to the extent the assets in
the Trust Fund are sufficient therefor, in the order of
precedence established under ERISA Section 4044.
11.4 Disposition Medium. The allocations referred to in
Article 11.3 may be implemented through the continuance of the
Trust Fund, through a new Trust Fund, or through the purchase of
insurance company annuity contracts, or by a combination of these
media.
ARTICLE 12.
Top Heavy Provisions
12.1 Application. The definitions in Article 12.2 shall
apply under this Article XII and the special rules in Article
12.3 shall apply, notwithstanding any other provisions of the
Plan, for any Plan Year in which the Plan is a Top Heavy Plan and
for such other Plan Years as may be specified herein. Anything
in this Article XII to the contrary notwithstanding, if a
multiple employer plan as described in Internal Revenue Code
Section 413(c), the provisions of this Article XII shall be
applied separately to each Employer (taken with the businesses
which are Commonly Controlled Entities with that Employer) taking
-37-
account of benefits under the plan provided to employees of the
Employer or Commonly Controlled Entity because of service with
that Employer or Commonly Controlled Entity.
12.2 Special Top Heavy Definitions. The following special
definitions shall apply under this Article XII:
(a) "Aggregation Group" means the group of plans in
a Mandatory Aggregation Group, if any, that includes the
Plan, unless the inclusion of Related Plans in the
Permissive Aggregation Group would prevent the Plan from
being a Top Heavy Plan, in which case "Aggregation Group"
means the group of plans consisting of the Plan and each
other Related Plan in a Permissive Aggregation Group with
the Plan.
(1) "Mandatory Aggregation Group" means each
plan (considering the Plan and Related Plans) that,
during the Plan Year that contains the Determination
Date or any of the four preceding Plan Years,
(A) had a Participant who was a Key
Employee, or
(B) was necessary to be considered with
a plan in which a Key Employee participated in
order to enable the plan in which the Key
Employee participated to meet the requirements
of Section 401(a)(4) or Section 410 of the
Internal Revenue Code.
If the Plan is not described in (A) or (B) above, it
shall not be part of a Mandatory Aggregation Group.
(2) "Permissive Aggregation Group" means the
group of plans consisting of (A) the plans, if any, in
a Mandatory Aggregation Group with the Plan and
(B) any other Related Plan that, when considered as a
part of the Aggregation Group, does not cause the
Aggregation Group to fail to satisfy the requirements
of Section 401(a)(4) and Section 410 of the Internal
Revenue Code. A Related Plan in (B) of the preceding
sentence may include a simplified employee pension
plan, as defined in Internal Revenue Code Section
408(k), and a collectively bargained plan, if when
considered as a part of the Aggregation Group such
plan does not cause the Aggregation Group to fail to
satisfy the requirements of Section 401(a)(4) and
Section 410 of the Internal Revenue Code considering,
if the plan is a multiemployer plan as described in
Internal Revenue Code Section 414(f) or a multiple
employer plan as described in Section 413(c), benefits
-38-
under the plan only to the extent provided to
employees of the employer because of service with the
employer and, if the plan is a simplified employee
pension plan, only the employer's contribution to the
plan.
(b) "Determination Date" means, with respect to a
plan year, the last day of the preceding plan year. If the
Plan is aggregated with other plans in the Aggregation
Group, the Determination Date for each other plan shall be,
with respect to any plan year, the Determination Date for
each such other plan which falls in the same calendar year
as the Determination Date for the Plan.
(c) "Highest Average Monthly Compensation" means one
sixtieth of a person's Compensation for a period consisting
of his sixty (60) consecutive calendar months in which his
Compensation was the highest preceding the date he ceases to
be an Employee. For purposes of this Section, a calendar
month ending on or next preceding the date a person ceases
to be an Employee and a calendar month beginning on or next
following the date such person becomes an Employee shall be
treated as consecutive. If a person has less than sixty
(60) consecutive calendar months of Compensation, Highest
Average Monthly Compensation shall mean the sum of the
person's Compensation divided by the number of months of
employment for which the person was compensated.
(d) "Key Employee" means, for the Plan Year
containing the Determination Date, any person or the
beneficiary of any person who is an Employee or former
Employee of an Employer or a Commonly Controlled Entity as
determined under Internal Revenue Code Section 416(i) and
who, at any time during the Plan Year containing the
Determination Date or any of the four (4) preceding Plan
Years (the "Measurement Period"), is a person described in
paragraph (1), (2), (3) or (4), subject to paragraph (5).
(1) An officer of the Employer or Commonly
Controlled Entity who:
(A) in any Measurement Period, in the
case of a Plan Year beginning after December 31,
1983, is an officer during the Plan Year and has
annual Compensation for the Plan Year in an
amount greater than fifty percent (50%) of the
amount in effect under Section 415(b)(1)(A) of
Internal Revenue Code for the calendar year in
which such Plan Year ends ($30,000 in 1984,
adjusted in subsequent years as determined in
accordance with regulations prescribed by the
Secretary of the Treasury or his delegate
-39-
pursuant to the provisions of Section 415(d) of
the Internal Revenue Code); and
(B) in any Measurement Period, in the
case of a Plan Year beginning on or before
December 31, 1983, is an officer during the Plan
Year, regardless of his Compensation (except to
the extent that applicable law, regulations and
rulings indicate that the fifty percent (50%)
requirement set forth in subparagraph (A) above
is applicable).
No more than a total of fifty (50) persons (or, if
lesser, the greater of three (3) persons or ten
percent (10%) of all persons or beneficiaries of
persons who are employees or former employees) shall
be treated as Key Employees under this paragraph (1)
for any Measurement Period. In the case of an
Employer or Commonly Controlled Entity which is not a
corporation:
(i) in any Measurement Period, in
the case of a Plan Year beginning on or
before February 28, 1985 no persons shall
be treated as Key Employees under this
paragraph (1); and
(ii) in any Measurement Period, in
the case of a Plan Year beginning after
February 28, 1985, the term "officer" as
used in this subsection (d) shall include
administrative executives as described in
Section 1.416-1(T-13) of the Treasury
Regulations.
(2) One (1) of the ten (10) persons who,
during a Plan Year in the Measurement Period:
(A) have annual Compensation from the
Employer or a Commonly Controlled Entity for
such Plan Year greater than the amount in effect
under Section 415(c)(1)(A) of the Internal
Revenue Code for the calendar year in which such
Plan Year ends ($30,000 in 1984, adjusted in
subsequent years as determined in accordance
with regulations prescribed by the Secretary of
the Treasury or his delegate pursuant to the
provisions of Section 415(d) of the Internal
Revenue Code); and
(B) own (or are considered as owning
within the meaning of Internal Revenue Code
-40-
Section 318) in such Plan Year, the largest
percentage interests in the Employer or a
Commonly Controlled Entity, in such Plan Year,
provided that no person shall be treated as a
Key Employee under this paragraph unless he owns
more than one-half percent (1/2%) interest in
the Employer or a Commonly Controlled Entity.
No more than a total of ten (10) persons or
beneficiaries of persons who are employees or former
employees shall be treated as Key Employees under this
paragraph (2) for any Measurement Period.
(3) A person who, for a Plan Year in the
Measurement Period, is a more than five percent (5%)
owner (or is considered as owning more than five
percent (5%) within the meaning of Internal Revenue
Code Section 318) of the Employer or a Commonly
Controlled Entity.
(4) A person, who, for a Plan Year in the
Measurement Period, is a more than one percent (1%)
owner (or is considered as owning more than one
percent (1%) within the meaning of Internal Revenue
Code Section 318) of the Employer or a Commonly
Controlled Entity and has an annual Compensation for
such Plan Year from the Employer and Commonly
Controlled Entities of more than $150,000.
(5) If the number of persons who meet the
requirements to be treated as Key Employees under
paragraph (1) or (2) exceed the limitation on the
number of Key Employees to be counted under
paragraph (1) or (2), those persons with the highest
annual Compensation in a Plan Year in the Measurement
Period for which the requirements are met and who are
within the limitation on the number of Key Employees
will be treated as Key Employees.
If the requirements of paragraph (1) or (2) are met by
a person in more than one (1) Plan Year in the
Measurement Period, each person will be counted only
once under paragraph (1) or (2):
(C) under paragraph (1), the Plan Year
in the Measurement Period in which a person who
was an officer and had the highest annual
Compensation shall be used to determine whether
the person will be treated as a Key Employee
under the preceding sentence;
-41-
(D) under paragraph (2), the Plan Year
in the Measurement Period in which the ownership
percentage interest is the greatest shall be
used to determine whether the person will be
treated as a Key Employee under the preceding
sentence.
Notwithstanding the above provisions of paragraph (5),
a person may be counted in determining the limitation
under both paragraphs (1) and (2). In determining the
sum of the Present Value of Accrued Benefits for Key
Employees under subsection (1) of this Section, the
Present Value of Accrued Benefits for any person shall
be counted only once.
(e) "Non-Key Employee" means a person with an
accrued benefit or account balance in the Plan or any
Related Plan during the Measurement Period who is not a Key
Employee, and any beneficiary of such a person.
(f) "Present Value of Accrued Benefits" means for
any Plan Year an amount equal to the sum of (1), (2), and
(3), subject to (4), for each person who, in the Plan Year
containing the Determination Date was a Key Employee or a
Non-Key Employee:
(1) The sum of the actuarial present values of
a person's accrued benefits under this Plan and each
Related Defined Benefit Plan in the Aggregation Group,
expressed as a benefit commencing at Normal Retirement
Date (or the person's attained age, if later)
determined based on the following actuarial
assumptions:
(A) Interest rate 5%; and
(B) Mortality: 1984 Unisex Pension
Table;
and determined in accordance with Internal Revenue
Code Section 416(g). The present value of an accrued
benefit for any person who is employed by an employer
maintaining a plan on the Determination Date is
determined as of the most recent valuation date which
is within a 12-month period ending on the
Determination Date, provided however that:
(C) for the first plan year of the plan,
the present value for an employee is determined
as if the employee had a Termination of
Employment (i) on the Determination Date or
(ii) on such valuation date but taking into
-42-
account the estimated accrued benefit as of the
Determination Date; and
(D) for the second and subsequent plan
years of the plan, the accrued benefit taken
into account for an employee is not less than
the accrued benefit taken into account for the
first plan year unless the difference is
attributable to using an estimate of the accrued
benefit as of the Determination Date for the
first plan year and using the actual accrued
benefit as of the Determination Date for the
second plan year.
For purposes of this paragraph (1), the valuation date
is the valuation date used by the plan for computing
plan costs for minimum funding, regardless of whether
a valuation is performed that year.
If the plan provides for a nonproportional
subsidy as described in Treasury Regulations Section
1.416-1 (T-26), the present value of accrued benefits
shall be determined taking into account the value of
nonproportional subsidized early retirement benefits
and nonproportional subsidized benefit options.
(2) The value of a person's accrued benefit
under each Related Defined Contribution Plan in the
Aggregation Group, determined as of the valuation date
coincident with or immediately preceding the
Determination Date, adjusted for contributions due as
of the Determination Date, as follows:
(A) in the case of a plan not subject to
the minimum funding requirements of Internal
Revenue Code Section 412, by including the
amount of any contributions actually made after
the valuation date but on or before the
Determination Date, and, in the first plan year
of a plan, by including contributions made after
the Determination Date that are allocated as of
a date in that first plan year; and
(B) in the case of a plan that is
subject to the minimum funding requirements, by
including the amount of any contributions that
would be allocated as of a date not later than
the Determination Date, plus adjustments to
those amounts as required under applicable
rulings, even though those amounts are not yet
required to be contributed or allocated (e.g.,
because they have been waived) and by including
-43-
the amount of any contribution actually made (or
due to be made) after the valuation date but
before the expiration of the extended payment
period in Internal Revenue Code Section
412(c)(10).
(3) The aggregate value of amounts distributed
during the plan year that includes the Determination
Date or any of the four preceding plan years,
including amounts distributed under a terminated plan
which, if it had not been terminated, would have been
in the Aggregation Group.
(4) The following rules shall apply in
determining the Present Value of Accrued Benefits:
(A) Amounts attributable to qualified
voluntary employee contributions, as defined in
Section 219(e) of the Internal Revenue Code,
shall be excluded.
(B) In computing the Present Value of
Accrued Benefits with respect to rollovers or
plan-to-plan transfers, the following rules
shall be applied to determine whether amounts
which have been distributed during the 5-year
period ending on the Determination Date from or
accepted into this Plan or any plan in the
Aggregation Group shall be included in
determining the Present Value of Accrued
Benefits:
(i) Unrelated Transfers accepted into
the Plan or any plan in the Aggregation
Group after December 31, 1983, shall not
be included.
(ii) Unrelated Transfers accepted on or
before December 31, 1983, and all Related
Transfers accepted at any time into the
Plan or any plan in the Aggregation Group
shall be included.
(iii) Unrelated Transfers made from the
Plan or any plan in the Aggregation Group
shall be included.
(iv) Related Transfers made from the Plan
or any plan in the Aggregation Group shall
not be included (but shall be counted by
the accepting plan).
-44-
(C) The Accrued Benefit of any
individual who has not received any Compensation
from an Employer maintaining the Plan at any
time during the five (5) year period ending on
the Determination Date shall be excluded.
(g) "Related Plan" means any other defined benefit
plan or a defined contribution plan (as defined in Section
415(k) of the Internal Revenue Code) maintained by an
Employer or a Commonly Controlled Entity, respectively
called a "Related Defined Benefit Plan" and a "Related
Defined Contribution Plan".
(h) "Related Transfer" means a rollover or a
plan-to-plan transfer which is either not initiated by the
Employee or is made between plans each of which is
maintained by a Commonly Controlled Entity.
(i) A "Top Heavy Aggregation Group" exists in any
Plan Year for which, as of the Determination Date, the sum
of the Present Value of Accrued Benefits for Key Employees
under all plans in the Aggregation Group exceeds sixty
percent (60%) of the sum of the Present Value of Accrued
Benefits for all employees under all plans in the
Aggregation Group; provided that, for purposes of
determining the sum of Present Value of Accrued Benefits for
all employees, there shall be excluded the Present Value of
Accrued Benefits of any Non-Key Employee who was a Key
Employee for any Plan Year preceding the Plan Year that
contains the Determination Date. For purposes of applying
the special rules herein with respect to a Super Top Heavy
Plan, a Top Heavy Aggregation Group will also constitute a
"Super Top Heavy Aggregation Group" if in any Plan Year as
of the Determination Date, the sum of the Present Value of
Accrued Benefits for Key Employees under all plans in the
Aggregation Group exceeds ninety percent (90%) of the sum of
the Present Value of Accrued Benefits for all employees
under all plans in the Aggregation Group.
(j) "Top Heavy Benefit Service" means the number of
Plan Years in which an Employee is a Participant and in
which he completes 1,000 Hours of Service excluding:
(1) Plan Years commencing before January 1,
1984;
(2) Plan Years in which the Plan is not a Top
Heavy Plan;
(3) If the Employee does not have any
nonforfeitable interest in his Accrued Benefit, years
of Top Heavy Benefit Service before any period of
-45-
consecutive One-Year Breaks in Service if the number
of consecutive One-Year Breaks in Service equals or
exceeds the greater of
(A) five (5) consecutive One-Year Breaks
in Service, or
(B) the aggregate number of Plan Years
during which the Participant had 1,000 Hours of
Service before the consecutive One-Year Breaks
in Service;
(4) any years of Top Heavy Benefit Service
earned before a One-Year Break in Service until the
Employee has completed one Year of Eligibility Service
following the One-Year Break in Service;
(5) for purposes of determining a
Participant's years of Top Heavy Benefit Service
before a period of five consecutive One-Year Breaks in
Service and a Termination of Employment, Years of Top
Heavy Benefit Service after the period of five
consecutive One-Year Breaks in Service; and
(6) periods of Parental Leave.
(k) "Top Heavy Plan" means the Plan in any Plan Year
in which (1) either a Key Employee is a Participant or the
Plan is a member of a Mandatory Aggregation Group, and
(2) the Plan is a member of a Top Heavy Aggregation Group.
For purposes of applying the rules herein with respect to a
Super Top Heavy Plan, a Top Heavy Plan will also constitute
a "Super Top Heavy Plan" if the Plan in any Plan Year is a
member of a Super Top Heavy Aggregation Group, including a
Super Top Heavy Aggregation Group consisting solely of the
Plan.
(l) "Unrelated Transfer" means a rollover or a
plan-to-plan transfer which is both initiated by the
Employee and (1) made from a plan maintained by a Commonly
Controlled Entity to a plan maintained by an employer which
is not a Commonly Controlled Entity or (2) made to a plan
maintained by a Commonly Controlled Entity from a plan
maintained by an employer which is not a Commonly Controlled
Entity.
12.3 Special Top Heavy Provisions. For each Plan Year in
which the Plan is a Top Heavy Plan, the following rules shall
apply, except that the special provisions of this Article 12.3
shall not apply with respect to any employee included in a unit
of employees covered by an agreement which the Secretary of Labor
finds to be a collective bargaining agreement between employee
-46-
representatives and one or more employees if there is evidence
that retirement benefits were the subject of good faith
bargaining between such employee representative and the Employer
or Employers:
(a) Minimum Benefits. For the first Plan Year in
which the Plan is a Top Heavy Plan and for every Plan Year
thereafter, regardless of whether the Plan is a Top Heavy
Plan, the Accrued Benefit of each Participant who is a
Non-Key Employee shall be a monthly amount payable for life
beginning at the earlier of (i) the Participant's Normal
Retirement Date or, if later, the Participant's Termination
of Employment, or (ii) the date the Participant reaches age
65 or, if later, the date of his third (3rd) anniversary in
the plan in an amount equal to the greater of:
(1) the Actuarial Equivalent of such
Participant's monthly benefit determined under
Article 2.1 (or under Section 4.7(b), if greater), or
(2) the lesser of (A) or (B), reduced by (C):
(A) 20% of the Participant's Highest
Average Monthly Compensation, or
(B) the sum of:
(i) the Actuarial Equivalent of
such Participant's monthly benefit
determined under Section 2.1 (or under
Section 4.7(b), if greater) as though he
had a Termination of Service on the last
day of the Plan Year ("Last Pre-Top Heavy
Year") immediately preceding the Plan Year
in which the Plan first became a Top Heavy
Plan, plus
(ii) the product of the positive
difference, if any, between
(I) 20% of such Participant's
Highest Average Monthly
Compensation, and
(II) the Actuarial Equivalent
of such Participant's monthly
benefit determined under Section 2.1
(or under Section 4.7(b), if
greater) as though he had a
Termination of Service on the last
day of the Last Pre-Top Heavy Year;
-47-
multiplied by a fraction, the numerator of
which is such Participant's years of Top
Heavy Benefit Service (not in excess of
10), and the denominator of which is 10.
(C) the Actuarial Equivalent in the form
of an annuity payable to the Participant for
life commencing on the Participant's Normal
Retirement Date of the amount in the Employee's
Employer Contribution General Account and
Employer Matching Contribution Account under the
Chicago and North Western Railway Company Profit
Sharing and Retirement Savings Program.
(3) For purposes of determining whether a
Non-Key Employee is a Participant entitled to the
minimum benefit described in this paragraph (a), a
Non-Key Employee will be treated as a Participant even
if he is not otherwise a Participant or entitled to an
accrual under the Plan because:
(A) he is not employed on a specified
date,
(B) he is excluded from participation in
the Plan (or accrues no benefit) merely because
his compensation is less than a stated amount,
or
(C) he is excluded from participation in
the Plan (or accrues no benefit) merely because
of a failure to make mandatory employee
contributions.
(b) Vesting. For each Plan Year in which the Plan
is a Top Heavy Plan and for each Plan Year thereafter, the
vested right of a Participant who has at least one hour of
service after the Plan becomes a Top Heavy Plan to a
percentage of his Accrued Benefit (to the extent the Accrued
Benefit had not been forfeited prior to the Plan's becoming
a Top Heavy Plan) shall be determined under the following
table:
Years of Continuous Vested
Service Percentage
Less than 3 0%
3 or more 100%
(c) Limitations. In computing the limitations under
Article 13.8 hereof for years in which the Plan is a Top
-48-
Heavy Plan, the special rules of Section 416(h) of the
Internal Revenue Code shall be applied in accordance with
applicable regulations and rulings so that, in determining
the denominator of the Defined Contribution Plan Fraction
and the Defined Benefit Plan Fraction, at each place at
which "1.25" would have been used, "1.00" shall be
substituted and in determining the numerator of the
transition fraction described in Section 415(e)(6)(B) of the
Internal Revenue Code by substituting $41,500 for $51,875,
unless the Plan is not a Super Top Heavy Plan and the
special requirements of Section 416(h)(2) of the Internal
Revenue Code have been satisfied.
(d) Transition Rule for a Top Heavy Plan.
Notwithstanding the provisions of Article 12.3(c), for each
Plan Year in which the Plan is a Top Heavy Plan and in which
the Plan does not meet the special requirements of Section
416(h)(2) of the Internal Revenue Code in order to use 1.25
in the denominator of the Defined Contribution Plan Fraction
and the Defined Benefit Plan Fraction, if an Employee was a
participant in one or more defined benefit plans and in one
or more defined contribution plans maintained by the
employer before the plans became Top Heavy Plans and if such
Participant's Combined Fraction exceeds 1.00 because of
accruals and additions that were made before the plans
became Top Heavy Plans, a factor equal to the lesser of 1.25
or such lesser amount (but not less than 1.00) as shall be
needed to make the Employee's Combined Fraction equal to
1.00 shall be used in the denominator of the Defined Benefit
Plan Fraction and the Defined Contribution Plan Fraction if
there are no further accruals or annual additions under any
Top Heavy Plans until the Participant's Combined Fraction is
not greater than 1.00 when a factor of 1.00 is used in the
denominators of the Defined Benefit Plan Fraction and the
Defined Contribution Plan Fraction. Any provisions herein
to the contrary notwithstanding, if the Plan is a Top Heavy
Plan and the Plan does not meet the special requirements of
Section 416(h)(2) of the Internal Revenue Code in order to
use 1.25 in the denominators of the Defined Benefit Plan
Fraction and the Defined Contribution Plan Fraction, there
shall be no further accruals under the Plan for a
Participant whose Combined Fraction is greater than 1.00
when a factor of 1.00 is used in the denominator of the
Defined Benefit Plan Fraction and the Defined Contribution
Plan Fraction, until such time as the Participant's Combined
Fraction is not greater than 1.00.
(e) Transition Rule for a Super Top Heavy Plan.
Notwithstanding the provisions of Article 12.3(c) and
12.3(d), for each Plan Year in which the Plan is a Super Top
Heavy Plan, (1) if an Employee was a participant in one or
more defined benefit plans and in one or more defined
-49-
contribution plans maintained by the employer before the
plans became Super Top Heavy Plans, and (2) if such
Participant's Combined Fraction exceeds 1.00 because of
accruals and additions that were made before the plans
became Super Top Heavy Plans and if immediately before the
plans became Super Top Heavy Plans the Combined Fraction as
then computed did not exceed 1.00, then a factor equal to
the lesser of 1.25 or such lesser amount (but not less than
1.00) as shall be needed to make the Employee's Combined
Fraction equal to 1.00 shall be used in the denominator of
the Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction if there are no further accruals
or annual additions under any Super Top Heavy Plans until
the Participant's Combined Fraction is not greater than 1.00
when a factor of 1.00 is used in the denominators of the
Defined Benefit Plan Fraction and the Defined Contribution
Plan Fraction. Any provisions herein to the contrary
notwithstanding, if the Plan is a Super Top Heavy Plan,
there shall be no further accruals under the Plan for a
Participant whose Combined Fraction is greater than 1.00
when a factor of 1.00 is used in the denominator of the
Defined Benefit Plan Fraction and the Defined Contribution
Plan Fraction until the Participant's Combined Fraction is
not greater than 1.00.
(f) Terminated Plan. If the Plan becomes a Top
Heavy Plan after it has formally been terminated, has ceased
crediting service for benefit accruals and vesting and has
been or is distributing all plan assets to participants and
their Beneficiaries as soon as administratively feasible, or
if a terminated plan has distributed all benefits of
participants and their beneficiaries, the provisions of
Article 12.3 shall not apply to the Plan.
(g) Frozen Plans. If the Plan becomes a Top Heavy
Plan after benefit accruals have ceased but all assets have
not been distributed to participants or their beneficiaries,
the provisions of Article 12.3 shall apply to the Plan.
(h) Actuarial Increase of Suspended Top Heavy
Benefits. If benefit payments are suspended hereunder
pursuant to Article 5.4 on account of continuation in or
resumption of employment after a person's Normal Retirement
Date or after his benefit payments have begun, then upon
resumption of benefit payments, the amount of such person's
Top Heavy Benefits shall be increased to the Actuarial
Equivalent of such Top Heavy Benefits determined as of the
date benefit payments resume. For purposes of the preceding
sentence, "Top Heavy Benefits" means the amount described in
Article 12.3(a)(2).
-50-
ARTICLE 13.
Miscellaneous Provisions
13.1 Non-Alienation of Benefits. No benefit payable at any
time under this Plan shall be subject in any manner to
alienation, sale, transfer, assignment, pledge, attachment, or
other legal processes, or encumbrance of any kind. Any attempt
to alienate, sell, transfer, assign, pledge or otherwise encumber
any such benefits, whether currently or thereafter payable, shall
be void. No benefit, nor any fund which may be established for
the payment of such benefits, shall, in any manner, be liable for
or subject to the debts or liabilities of any person entitled to
such benefits.
Notwithstanding the foregoing provisions of Article 13.1,
the Trustee, in accordance with the Committee's directions,
(a) shall comply with an order entered on or after
January 1, 1985 determined by the Committee to be a
Qualified Domestic Relations Order as provided in Article
13.2,
(b) shall comply with a domestic relations order
entered before January 1, 1985 if benefits are already being
paid under such order, and
(c) may treat an order entered before January 1,
1985 as a Qualified Domestic Relations Order even if it does
not meet the requirements of Article 13.2.
13.2 Qualified Domestic Relations Order.
(a) "Qualified Domestic Relations Order" means any
judgement, decree, or order (including approval of a
property settlement agreement):
(1) which is made pursuant to a state domestic
relations law (including a community property law),
(2) which relates to the provision of child
support, alimony payments, or marital property rights
to a spouse, former spouse, child, or other dependent
of a Participant,
(3) which creates or recognizes the existence
of an alternate payee's right to receive all or a
portion of the Participant's Accrued Benefit under the
Plan, and
-51-
(b) A domestic relations order can be a Qualified
Domestic Relations Order only if such order clearly
specifies:
(1) the name and the last known mailing
address, if any, of the Participant and the name and
mailing address of each alternate payee covered by the
order,
(2) the amount or percentage of the
Participant's Accrued Benefit to be paid by the Plan
to each such alternate payee, or the manner in which
such amount or percentage is to be determined,
(3) the number of payments or period to which
such order applies, and
(4) each Plan to which such order applies.
(c) A domestic relations order can be a Qualified
Domestic Relations Order only if such order does not:
(1) require the Plan to provide any type or
form of benefit, or any option not otherwise provided
under the Plan,
(2) require the Plan to provide increased
benefits (determined on the basis of actuarial value),
or
(3) require the payment of benefits to an
alternate payee which are required to be paid to
another alternate payee under another order previously
determined to be a Qualified Domestic Relations Order.
A Participant's total retirement benefits from
Railroad Retirement benefits and Company retirement plans
are assured by this Plan as this Plan provides benefits in
the amount (if any) necessary when added to the sum of
(i) the Participant's benefits under the Profit Sharing Plan
described in Article 2.1(c) ("Profit Sharing Benefit") and
(ii) the portion of the Employee's Primary Railroad
Retirement Benefit designated in Section 2.1(b) hereof to
the amount specified in Article 2.1(a). Therefore, if the
Participant's Profit Sharing Benefit as specified in 2.1(c)
increases more rapidly than the amount of the total
retirement benefit as specified in Article 2.1(a), the
dollar amount of the Retirement Benefits hereunder would
diminish. Consequently, for a domestic relations court
order not to increase the actuarial value of a Participant's
benefits in accordance with Section 13.2(c)(2), the order
would either have to be expressed as a percent of the
-52-
Participant's final Retirement Benefits under this Plan or,
if expressed as a dollar amount, would have to be subject to
the provision that such amount be not greater than 100% of
the Participant's Retirement Benefits determined as of the
date such benefits commence to be paid to the Participant.
Moreover, since for the foregoing reasons the amount of a
Participant's Retirement Benefits cannot be determined until
his benefit has commenced or his Normal Retirement Date,
whichever occurs first, an order purporting to direct
payment of benefits to an alternate payee prior to such date
could result in requiring benefits to be paid in excess of
the actuarial value of the Participant's Retirement Benefits
because the amount of the Participant's Retirement Benefits
may decrease until such date.
(d) In the case of any payment before a Participant
has had a Termination of Employment, a domestic relations
order shall not be treated as failing to meet the
requirements of Article 13.2(c)(1) solely because such order
requires that payment of benefits be made to an alternate
payee:
(1) on or after the date on which the
Participant attains (or would have attained) 60 years
of age.
(2) as if the Participant had retired on the
date on which such payment is to begin under such
order (but taking into account only the present value
of the benefits actually accrued and not taking into
account the present value of any employer subsidy for
early retirement), and
(3) in any form in which such benefits may be
paid under the Plan to the Participant (other than in
the form of a Qualified Joint and Survivor Annuity
with respect to the alternate payee and his or her
subsequent spouse).
(e) To the extent provided in any Qualified Domestic
Relations Order the former spouse of a Participant shall be
treated as the surviving spouse of such Participant for the
purposes of consenting to the Participant's waiver of a
Surviving Spouse's Pension or a Qualified Joint and Survivor
Annuity.
13.3 No Contract of Employment. Nothing contained in this
Plan shall be construed as a contract of employment between any
Employer and any Employee or as creating a right of any Employee
to be continued in the employment of any Employer.
-53-
13.4 Termination of Employment on Retirement. When an
Employee is retired, his employment relationship shall be
terminated, and his right to benefits shall be determined by the
terms of this Plan.
13.5 Limitation on Vesting. No person shall have any
vested right to benefits under this Plan until all of the
applicable requirements for such benefits set forth in Article IV
have been fulfilled, and then any such rights shall be subject to
the limitation of Article 6.5.
13.6 No Duplication of Benefit. No benefits shall be paid
to any person under more than one provision of this Plan for the
same period of time.
13.7 Temporary Limitations on Retirement Benefits Payable
to Highly Compensated Participants.
(a) For Plan Years beginning prior to January 1,
1994, any provision of the Plan to the contrary
notwithstanding, benefits and distributions under the Plan
shall be subject to the limitations imposed under this
section 13.7(a).
(1) If a Participant was among the 25 highest
paid employees of the employer on the latest of
(1) July 1, 1979, (2) the effective date of the
commencement of such employer's participation in the
Plan or (3) the date of the most recent amendment to
the Plan which substantially increased Retirement
Benefits (the latest of which shall hereafter be
referred to as the "Limitation Date") and if the
Participant's anticipated annual Retirement Benefits
from Employer Contributions exceed $1,500, except as
otherwise provided in subparagraphs (c), (d) and (e),
the Participant's Retirement Benefits shall be limited
as provided in subparagraph (b) if:
(i) the Plan is terminated within ten
years after the Limitation Date, or
(ii) the Retirement Benefits of a
Participant become payable within such ten-year
period.
If subparagraph (ii) above is applicable, the
restrictions shall remain in effect until the later of
the expiration of the ten-year period or the date on
which the full current costs have been funded.
(2) If a Participant is subject to the
provisions of this Section, the Retirement Benefits
-54-
payable to him shall not exceed the Retirement
Benefits which can be provided from the greatest of
the following:
(i) The Employer Contributions (or funds
attributable thereto) which would have been
applied to provide Retirement Benefits for the
Participant if the Plan had not been amended on
the Limitation Date and had continued without
change;
(ii) $20,000; or,
(iii) The sum of (A) the Employer
Contributions (or funds attributable thereto)
which would have been applied to provide
benefits for the Participant if the Plan had
been terminated on the day before the Limitation
Date (if applicable) and (B) an amount computed
by multiplying the number of years for which the
current costs of the Plan have been met after
the Limitation Date by 20% of the first $50,000
of the Participant's average annual compensation
during his last 5 years of employment;
provided, however, that the following limitations will
apply if they are greater than the applicable amounts
in Articles 13.7(b)(2) and 13.7(b)(3):
(i) in the case of a Participant who is a
substantial owner described in ERISA Section
4022(b)(5), the present value of the benefit
guaranteed for such Participant under ERISA
Section 4022, if the Plan has terminated, or the
present value of the benefit that would be
guaranteed, if the Plan terminates on the date
the benefit commences, determined in accordance
with regulations of the PBGC; or
(ii) in the case of a Participant subject to
Article 13.7(a) who is not a substantial owner
described in ERISA Section 4022(b)(5), the
present value of the maximum benefit described
in ERISA Section 4022(b)(3)(B) (determined on
the date the Plan terminates or on the date
benefits commence, whichever is earlier, and
determined in accordance with regulations of the
PBGC without regard to any other limitations in
ERISA Section 4022).
(3) The limitations described above may be
exceeded for the purpose of making current payments of
-55-
Retirement Benefits to retired Participants who would
otherwise be subject to such restrictions, provided
that:
(i) The contributions which may be used
for any such retired Participant in accordance
with the restrictions heretofore indicated are
applied to provide either a level amount of
pension in an optional form of benefit not
greater in amount than the level amount of
pension under the basic form of benefit,
(ii) the pension thus provided is
supplemented by monthly payments to the extent
necessary to provide the full pension in the
basic form called for by the Plan, and
(iii) such supplemental payments are made
only if (A) the full current costs of the Plan
have been met or (B) the aggregate of such
supplemental payments for all such retired
Participants does not exceed the aggregate
Employer Contributions already made under the
Plan in the year then current.
(4) The limitations in this Article shall
automatically become inoperative and of no effect upon
a ruling by the Internal Revenue Service that they are
not required.
(5) If regulations are issued modifying the
limitations described in this Article, the Plan shall
be amended in a timely fashion to incorporate such
modified regulations; and prior to such amendment, the
Plan shall be administered in accordance with the
modified regulations.
(b) For Plan Years beginning on or after January 1,
1994 any provision of the Plan to the contrary
notwithstanding, benefits and distributions under the Plan
shall be subject to the limitations imposed under this
Section 13.7(b).
(1) Definitions. The following special
definitions apply under this Section 13.7(b):
(i) "Benefit Payments," for purposes of
Section 13.7(b)(2) and (3), include loans
in excess of the amounts set forth in
Section 72(p)(2)(A) of the Internal
Revenue Code, any periodic income, any
withdrawal values payable to a living
-56-
Employee or former Employee, and death
benefits not provided for by insurance on
the Employee's or former Employee's life.
(ii) "Highly Compensated Participant"
means an Employee or a former Employee who
is one of the 25 Highly Compensated
Employees with the greatest Compensation
in the current or any prior Plan Year.
(2) Restriction on Benefits of Highly
Compensated Employees Upon Plan Termination. In the
event that the Plan is terminated, the Benefit
Payments to any Participant who is a Highly
Compensated Employee shall be limited to Benefit
Payments that are nondiscriminatory under Section
401(a)(4) of the Internal Revenue Code.
(3) Restrictions on Distributions to Highly
Compensated Participants. The annual payments to a
Highly Compensated Participant shall not exceed an
amount equal to the payments that would be made on
behalf of the Highly Compensated Participant under a
single life annuity that is the Actuarial Equivalent
of the sum of the Highly Compensated Participant's
Accrued Benefit and the Highly Compensated
Participant's other benefits under the Plan. The
limitation imposed under this Section 13.7(b)(3) shall
not apply, however, if
(i) after payment to a Highly
Compensated Participant of all Benefit Payments,
the value of Plan assets equals or exceeds 110
percent of the value of current liabilities (as
defined in Section 412(1)(7) of the Internal
Revenue Code),
(ii) the value of the Benefit Payments
for a Highly Compensated Participant is less
than 1 percent of the value of current
liabilities (as defined in Section 412(1)(7) of
the Internal Revenue Code) before distribution,
or
(iii) the present value of the Highly
Compensated Participant's vested Accrued Benefit
does not exceed $3,500 and is distributed
without the consent of the Participant or his
spouse in accordance with Section 13.10.
13.8 Maximum Pensions. Any provisions of the Plan to the
contrary notwithstanding, a Participant's Retirement Benefits,
-57-
when expressed as a yearly pension, shall not exceed the
Participant's Maximum Annual Benefit. For purposes of this
Section 13.8, Maximum Annual Benefit shall mean the lesser of
$90,000 (for 1984) or 100% of the Participant's average annual
Compensation for the Participant's highest three consecutive
calendar years reduced by the annual pension, if any, payable to
the Participant under any other defined benefit plan maintained
by the Employer (or any Commonly Controlled Entity) to the extent
attributable to contributions by the Employer (or any Commonly
Controlled Entity), subject to the following:
(a) If the form of Retirement Benefits payable to a
Participant is other than a Straight Life Annuity, and if
the contingent annuitant is not the Participant's spouse,
the Participant's Annual Retirement Benefits shall not
exceed the Actuarial Equivalent of the Maximum Annual
Benefit.
(b) If at the time Retirement Benefits commence the
Participant has not attained the social security retirement
age, the Maximum Annual Benefit shall be reduced to the
Actuarial Equivalent of the Maximum Annual Benefit
commencing at the social security retirement age.
(c) If the Participant has fewer than ten years of
participation in the Plan at retirement, the Maximum Annual
Benefit shall be multiplied by a fraction, of which the
numerator is his years of participation in the Plan and the
denominator is 10.
(d) If the Participant's Retirement Benefits begin
after the social security retirement age, the Maximum Annual
Benefit shall be increased so that it is the Actuarial
Equivalent of the Maximum Annual Benefit at the social
security retirement age.
(e) The $90,000 (for 1984) component of the Maximum
Annual Benefit shall be increased as permitted by applicable
governmental regulations and rulings to reflect
cost-of-living adjustments.
(f) The term, "social security retirement age" as
used in Article 13.8 means the age used as the retirement
age under section 216(l) of the Social Security Act applied
without regard to the age increase factor and as if the
early retirement age under section 216(l)(2) of such Act
were 62.
(g) Notwithstanding the foregoing provisions of
Article 13.8, if a Participant was a Participant before
January 1, 1983 and if such Participant's Accrued Benefit as
of the last day of the preceding Plan Year under the Plan
-58-
exceeds the limitation stated in the first paragraph of
Article 13.8, then the limitation under Article 13.8 with
respect to such Participant shall be equal to the
Participant's Accrued Benefit as of the last day of the
preceding Plan Year.
(h) If a Participant is also a participant in any
defined contribution plan of the Employer (or any Commonly
Controlled Entity), and if the sum of the Participant's
Defined Benefit Plan Fraction (as defined in Article
13.8(f)(1)) and the Participant's Defined Contribution Plan
Fraction (as defined in Article 13.8(f)(2)) exceeds 1.0
(such sum called the "Combination Fraction"), the
Participant's Maximum Annual Benefit shall be reduced to the
extent necessary to reduce such sum to 1.0.
(1) The "Defined Benefit Plan Fraction"
applicable to a Participant for any Plan Year is a
fraction, the numerator of which is the sum of the
Projected Annual Benefit of the Participant (as
defined in Section 12.2(g)) under all of the Related
Defined Benefit Plans in which he participates
(determined as of the close of the Plan Year) and the
denominator of which is the lesser of (i) the product
of 1.25 multiplied by the maximum dollar limitation on
a Participant's Projected Annual Benefit if the Plan
provided the maximum benefit allowable under Section
415(b) of the Code for such Plan Year, or (ii) the
product of 1.4 multiplied by 100% of the Participant's
Highest Average Compensation.
Notwithstanding the above, if the Participant
was a participant in one or more defined benefit plans
maintained by the Employer which were in existence on
July 1, 1982, the denominator of this fraction will
not be less than 1.25 multiplied by the sum of the
annual benefits under such plans which the Participant
had accrued as of December 31, 1982. The preceding
sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the
requirements of Section 415 as in effect at the end of
the 1982 limitation year.
(2) The "Defined Contribution Plan Fraction"
applicable to a Participant for any Plan Year is a
fraction, the numerator of which is the sum of the
Participant's annual additions as of the close of such
Plan Year for that Plan Year and for all prior Plan
years under all of the Related Plans (as defined in
Section 12.2(g)) in which he participates, and the
denominator of which is the sum of the lesser of the
following amounts (determined for such Plan Year and
-59-
for each prior Plan Year of service with the Employer
or any Commonly Controlled Entity regardless of
whether a plan was in existence during those years):
(i) the product of 1.25 multiplied by the dollar
limitation in effect under Code Section 415(c)(1)(A)
for the Plan Year (determined without regard to the
special dollar limitation for employee stock ownership
plans), or (ii) the product of 1.4 multiplied by
twenty-five percent of the Participant's Compensation
for the Plan Year. An amount shall be subtracted from
the numerator of the Defined Contribution Plan
Fraction (such amount not to exceed such numerator),
consistent with regulations prescribed by the
Secretary of the Treasury, so that the sum of the
Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction does not exceed 1.0 for the
last Plan Year of the Plan beginning before January 1,
1983.
(i) Definitions
(1) "Highest Average Compensation" means the
average of a Participant's highest compensation for
three consecutive Plan Years (determined as of the
close of the Plan Year) of employment with the
employer (or the actual number of years of employment
for those Participants who are employed for less than
three consecutive years with the employer).
(2) "Projected Annual Benefit" means the
annual benefit a Participant would receive from
employer contributions under a defined benefit plan,
adjusted, in the case of any benefit payable in a form
other than a single life annuity or a qualified joint
and survivor annuity, to the actuarial equivalent of a
single life annuity, assuming (i) the Participant
continued employment until reaching the plan's Normal
Retirement Date (or his current age, if later),
(ii) his compensation remained unchanged and (iii) all
other relevant factors used to determine benefits
under the plan remained constant in the future.
13.9 Limitation on Liability. No Employer nor any agent or
representative of any Employer who is an employee, officer or
director of an Employer in any manner guarantees the Trust Fund
against loss or depreciation, and to the extent not prohibited by
federal law, none of them shall be liable (except for his own
gross negligence or willful misconduct) for any act or failure to
act done or omitted in good faith with respect to the Plan. No
Employer shall be responsible for any act or failure to act of
any Trustee appointed to administer the Trust Fund.
-60-
13.10 Small Pensions. If the lump sum Actuarial Equivalent
of the monthly amount of benefits payable hereunder to any
Pensioner or surviving spouse is not greater than $3,500, the
Committee may in its discretion direct that such benefits be paid
in the form of a lump sum notwithstanding any provisions of the
Plan to the contrary.
13.11 Company Merger. In the event that any successor
corporation to the Company, by merger, consolidation, purchase or
otherwise, shall elect to adopt the Plan, such successor
corporation shall be substituted hereunder for the Company upon
filing in writing with the Trustee its election so to do.
13.12 Plan Merger. The Plan shall not merge or consolidate
with, or transfer any assets or liabilities to any other plan,
unless each Participant would receive a benefit immediately after
the merger, consolidation or transfer (if the Plan were then
terminated) which is equal to or greater than the benefit he
would have been entitled to immediately before the merger,
consolidation or transfer (if the Plan were terminated).
13.13 Invalidity of Certain Provisions. If any provision of
this Plan shall be held invalid or unenforceable, such invalidity
or unenforceability shall not affect any other provisions hereof
and the Plan shall be construed and enforced as if such
provisions, to the extent invalid or unenforceable, had not been
included.
13.14 Headings. The headings of articles are included
solely for convenience of reference, and if there is any conflict
between such headings and the text of this Plan, the text shall
control.
13.15 Uniform and Non-Discriminatory Treatment. Any
discretion exercisable hereunder by the Company, an Employer, or
the Committee shall be exercised in a uniform and
nondiscriminatory manner.
CHICAGO AND NORTH WESTERN
RAILWAY COMPANY
By /s/ R. F. Ard
Vice President
ATTEST
Corporate Seal)
/s/ Robin Bourne-Caris
Secretary
Date December 30, 1994
-61-
APPENDIX I
For purposes of determining the Actuarial Equivalent under
Article 2.2 of the Plan, the mortality basis and interest rate
used shall be the following:
(a) Mortality Basis: The mortality Table used shall be
the UP-1984 Table without adjustment.
(b) Interest Rate: The interest rate used shall be
determined in accordance with (i), (ii), or (iii)
below:
(i) For purposes of determining the Actuarial
Equivalent under Article 2.1(c), 2.1(d), 2.1(e)
or 4.5 during a calendar year, the interest rate
used shall be the sum of the November 30 yield
to maturity for the Lehman Brothers Kuhn Loeb,
Long Term Government Agency Bond Index
(hereinafter called the "index") for the three
preceding calendar years divided by three with
the results rounded to the nearest quarter of a
percent. In the event that the index is not in
existence as of November 30 of any calendar
year, the November 30 twenty-year yield series
for the Treasury Constant Maturity Yield Series
shall be substituted for the index for all years
used in the determination of the interest rate
under this subparagraph (i). If neither such
index is or was in existence for a sufficient
period of time to permit a determination of the
above described three preceding calendar year
average rate of interest, such average rate of
interest shall be based upon the United States
Long Term Treasury Bonds with more than a 10
year maturity. For the purposes of determining
Actuarial Equivalent under Article 4.5, the
interest rate shall be determined and applied as
of the date on which a person receives or
commences to receive benefits under an Other
Plan, as defined in Article 4.5.
(ii) For purposes of determining the lump sum
Actuarial Equivalent under Article 13.10, the
interest rate used shall be the interest rate
which would be used (as of the date of
distribution) by the Pension Benefit Guaranty
Corporation for purposes of determining the
present value of a lump sum distribution on plan
termination.
-62-
(iii) Except as otherwise provided in Article XII and
Section 13.8, for all other Plan purposes, the
interest rate shall be 8%.
Notwithstanding the above provisions, for purposes of determining
the benefit payable under Article 4.2 upon Termination of
Employment, the Actuarial Equivalent shall be the Accrued Benefit
reduced by l/2 of l% for each full month that the benefit
commencement date precedes Normal Retirement Date.
For purposes of determining the benefit payable under
Article 4.9, the Actuarial Equivalent shall be the Accrued
Benefit reduced by 1/2 of 1% for each full month that the
+benefit commencement date precedes Normal Retirement Date to the
first full month after the Member attains age 55 and further
reduced for each full month that the benefit commencement date
precedes the first full month after the Member attains age 55
using the mortality assumptions specified in Part (a) above and
the interest rate assumptions specified in Part(b)(ii) above.
For purposes of determining the benefit payable under
Article 4.9, the Actuarial Equivalent shall be the Accrued
Benefit reduced by 1/2 of 1% for each full month that the benefit
commencement date precedes Normal Retirement Date to the first
full month after the Member attains age 55 and further reduced
for each full month that the benefit commencement date precedes
the first full month after which the Member attains age 55 using
the mortality assumptions specified in Part (a) above and the
interest rate assumptions specified in Part(b)(iii) above.
-63-
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 3/22/95 |
| For Period End: | | 12/31/94 | | | | | | | 10-K/A |
| | 12/30/94 | | 65 |
| | 5/5/94 | | 1 | | 39 |
| | 1/1/94 | | 11 | | 60 |
| | 1/1/93 | | 30 |
| List all Filings |
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