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Exhibit 10(d)(i)
HARRIS CORPORATION
RETIREMENT PLAN
AMENDED AND RESTATED
JUNE 23, 2000
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TABLE OF CONTENTS
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ARTICLE I DEFINITIONS....................................................................2
1.1 ACCOUNTS..........................................................................2
1.2 AFTER-TAX ACCOUNT.................................................................2
1.3 AFTER-TAX CONTRIBUTIONS...........................................................2
1.4 BALANCED FUND.....................................................................2
1.5 BASIC ACCOUNT.....................................................................2
1.6 BENEFICIARY.......................................................................2
1.7 BREAK-IN-SERVICE..................................................................2
1.8 CODE..............................................................................2
1.9 COMPENSATION......................................................................3
1.10 CONSOLIDATED SUBSIDIARIES........................................................5
1.11 CORPORATION......................................................................5
1.12 DISABILITY.......................................................................5
1.13 EARLY RETIREMENT AGE.............................................................5
1.14 EMPLOYMENT UNIT..................................................................5
1.15 EMPLOYEE.........................................................................5
1.16 ERISA............................................................................6
1.17 EXCESS COMPENSATION..............................................................6
1.18 FISCAL YEAR......................................................................6
1.19 FULL-TIME EMPLOYEE...............................................................7
1.20 HARRIS STOCK FUND................................................................7
1.21 HARRIS STOCK AFTER-TAX ACCOUNT...................................................7
1.22 HARRIS STOCK MATCHING ACCOUNT....................................................7
1.23 HARRIS STOCK PRE-TAX ACCOUNT....................................................7
1.24 HIGHLY COMPENSATED EMPLOYEE......................................................7
1.25 HOUR OF SERVICE..................................................................8
1.26 INVESTMENT COMMITTEE.............................................................8
1.27 INVESTMENT FUNDS.................................................................8
1.28 LEAVE OF ABSENCE.................................................................8
1.29 MATCHING AFTER-TAX ACCOUNT.......................................................8
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1.30 MATCHING AFTER-TAX CONTRIBUTIONS.................................................8
1.31 MATCHING CONTRIBUTIONS...........................................................9
1.32 MATCHING PRE-TAX ACCOUNT.........................................................9
1.33 MATCHING PRE-TAX CONTRIBUTIONS...................................................9
1.34 MILITARY LEAVE...................................................................9
1.35 NORMAL RETIREMENT AGE............................................................9
1.36 PARTICIPANT......................................................................9
1.37 PARTICIPATING COMPANY............................................................9
1.38 PERIOD OF SERVICE...............................................................10
1.39 PERIOD OF SEVERANCE.............................................................10
1.40 PLAN............................................................................10
1.41 PLAN YEAR.......................................................................10
1.42 PREDECESSOR COMPANY.............................................................10
1.43 PRE-TAX ACCOUNT.................................................................10
1.44 PRE-TAX CONTRIBUTIONS...........................................................11
1.45 PROFIT-SHARING ACCOUNT..........................................................11
1.46 PROFIT-SHARING CONTRIBUTIONS....................................................11
1.47 RELATED COMPANY.................................................................11
1.48 RELEASE EMPLOYEE................................................................11
1.49 RETIREMENT PLAN ADMINISTRATIVE COMMITTEE........................................12
1.50 ROLLOVER ACCOUNT................................................................12
1.51 SAVINGS ACCOUNT.................................................................12
1.52 SERP............................................................................12
1.53 SEVERANCE FROM SERVICE DATE.....................................................12
1.54 SUPPLEMENTAL ACCOUNT............................................................12
1.55 TAXABLE WAGE BASE...............................................................13
1.56 TRUST AGREEMENT.................................................................13
1.57 TRUST FUND......................................................................13
1.58 TRUSTEE.........................................................................13
1.59 VALUATION DATE..................................................................13
ARTICLE II PARTICIPATION...............................................................13
2.1 IN GENERAL.......................................................................13
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2.2 RENEWAL OF PARTICIPATION ON REEMPLOYMENT.........................................14
2.3 PERIODS OF SERVICE ON REEMPLOYMENT...............................................14
2.4 SERVICE WITH PREDECESSOR COMPANY.................................................15
2.5 MILITARY LEAVE...................................................................15
ARTICLE III CONTRIBUTIONS AND ALLOCATIONS..............................................16
3.1 PROFIT-SHARING CONTRIBUTIONS.....................................................16
3.2 ALLOCATION OF PROFIT-SHARING, CONTRIBUTION TO PARTICIPANTS.......................19
3.3 PRE-TAX CONTRIBUTIONS............................................................20
3.4 MATCHING PRE-TAX CONTRIBUTIONS...................................................22
3.5 AFTER-TAX CONTRIBUTIONS..........................................................22
3.6 MATCHING AFTER-TAX CONTRIBUTIONS.................................................23
3.7 ELECTIONS TO MAKE PRE-TAX AND AFTER-TAX CONTRIBUTIONS............................24
3.8 ROLLOVER CONTRIBUTIONS...........................................................25
3.9 PARTICIPATING COMPANY'S OBLIGATION TO MAKE CONTRIBUTIONS.........................26
3.10 TREATMENT OF FORFEITED AMOUNTS..................................................26
3.11 FINALITY OF ALLOCATIONS.........................................................27
ARTICLE IV LIMITATIONS ON CONTRIBUTIONS................................................28
4.1 IN GENERAL.......................................................................28
4.2 PRE-TAX CONTRIBUTIONS............................................................28
4.3 LIMITATIONS ON CONTRIBUTIONS FOR HIGHLY COMPENSATED EMPLOYEES....................29
4.4 LIMITATIONS ON ANNUAL ADDITIONS..................................................42
ARTICLE V VESTING AND FORFEITURES......................................................45
5.1 IN GENERAL.......................................................................45
5.2 VESTING ON RETIREMENT, DEATH OR DISABILITY.......................................45
5.3 VESTING ON OTHER TERMINATION OF EMPLOYMENT.......................................45
5.4 EFFECT OF IN-SERVICE WITHDRAWALS ON A PARTICIPANT'S VESTED PERCENTAGE............47
5.5 FORFEITURES......................................................................47
ARTICLE VI ACCOUNTS AND INVESTMENTS....................................................48
6.1 ESTABLISHMENT OF ACCOUNTS........................................................48
6.2 INVESTMENT OF ACCOUNTS...........................................................50
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6.3 ALLOCATION OF EARNINGS AND LOSSES................................................52
6.4 SPECIAL RULES CONCERNING HARRIS STOCK FUND......................................52
ARTICLE VII DISTRIBUTIONS..............................................................55
7.1 IN GENERAL.......................................................................55
7.2 SMALL BENEFIT CASH-OUT...........................................................56
7.3 FORM OF PAYMENT..................................................................57
7.4 TIME OF PAYMENT..................................................................58
7.5 DIRECT ROLLOVER..................................................................58
7.6 BENEFIT AMOUNT AND WITHHOLDING...................................................60
7.7 ORDER OF DISTRIBUTIONS...........................................................60
7.8 STATUTORY REQUIREMENTS...........................................................61
7.9 DESIGNATING BENEFICIARIES........................................................64
7.10 PAYMENT OF GROUP INSURANCE PREMIUMS.............................................66
7.11 INABILITY TO LOCATE PARTICIPANT.................................................66
ARTICLE VIII LOANS......................................................................67
8.1 IN GENERAL.......................................................................67
8.2 LOAN ADMINISTRATION..............................................................67
8.3 TERMS AND CONDITIONS OF LOANS....................................................68
8.4 INTEREST RATE....................................................................69
8.5 REPAYMENT AND DEFAULT............................................................70
8.6 MECHANICS........................................................................72
8.7 SPECIAL POWERS...................................................................72
ARTICLE IX IN-SERVICE WITHDRAWALS......................................................73
9.1 WITHDRAWALS FROM SAVINGS ACCOUNT AND AFTER-TAX ACCOUNT...........................73
9.2 WITHDRAWALS FROM ROLLOVER, PRE-TAX AND PROFIT SHARING ACCOUNTS...................73
9.3 CONDITIONS APPLICABLE TO ALL WITHDRAWALS.........................................76
9.4 REDUCTION OF INVESTMENT FUND BALANCES............................................76
ARTICLE X TOP-HEAVY PROVISIONS.........................................................76
10.1 IN GENERAL......................................................................76
10.2 MINIMUM ALLOCATION..............................................................77
10.3 MINIMUM VESTING.................................................................77
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10.4 DEFINITIONS.....................................................................78
ARTICLE XI ADMINISTRATION..............................................................82
11.1 NAMED FIDUCIARIES...............................................................82
11.2 RETIREMENT PLAN ADMINISTRATIVE COMMITTEE........................................83
11.3 POWERS AND DUTIES OF COMMITTEE..................................................83
11.4 ACTIONS OF COMMITTEE............................................................83
11.5 FINALITY OF DECISIONS...........................................................84
11.6 IMMUNITIES......................................................................84
11.7 ADVISORS AND AGENTS.............................................................84
11.8 COMMITTEE MEMBER WHO IS PARTICIPANT.............................................85
11.9 INFORMATION PROVIDED BY PARTICIPATING COMPANIES.................................85
11.10 EXPENSE........................................................................85
11.11 TRUST..........................................................................86
11.12 TRUST FUND AVAILABLE TO PAY ALL PLAN BENEFITS..................................86
ARTICLE XII AMENDMENT AND TERMINATION AND CHANGE OF CONTROL............................86
12.1 AMENDMENT.......................................................................87
12.2 TERMINATION OF PLAN.............................................................87
12.3 DISCONTINUANCE OF CONTRIBUTIONS.................................................88
12.4 VESTING ON TERMINATION OR DISCONTINUANCE OF CONTRIBUTIONS.......................88
12.5 DISTRIBUTION ON TERMINATION.....................................................88
12.6 CHANGE OF CONTROL...............................................................88
ARTICLE XIII MISCELLANEOUS PROVISIONS..................................................94
13.1 RESTRICTIONS ON ALIENATION: QUALIFIED DOMESTIC RELATIONS ORDERS.................94
13.2 EXCLUSIVE BENEFIT REQUIREMENT...................................................96
13.3 RETURN OF CONTRIBUTIONS.........................................................96
13.4 NO CONTRACT OF EMPLOYMENT.......................................................96
13.5 PAYMENT OF BENEFITS ON INCAPACITY...............................................97
13.6 MERGER..........................................................................97
13.7 CONSTRUCTION....................................................................97
13.8 GOVERNING LAW...................................................................98
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13.9 MISTAKEN PAYMENTS...............................................................98
APPENDIX A
Investment Funds........................................................................A-1
APPENDIX B
Special Provisions For Transferred Participants.........................................B-1
APPENDIX C
Participating Companies.................................................................C-1
APPENDIX D
Former Participants in the Intraplex, Inc. 401(k) Profit Sharing Plan...................D-1
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INTRODUCTION
The Harris Corporation Retirement Plan (the "Plan") is hereby amended
and restated effective June 23, 2000 to incorporate all amendments to the Plan
and to comport with legislative enactments. The provisions of the Plan to the
extent so amended and restated shall apply only to those participants in the
Plan who are Employees on or after June 23, 2000. Any benefits of an individual
who ceased being an Employee before June 23, 2000 and who is not re-employed by
a Participating Company after such date shall be determined under the terms of
the Plan that were in effect when such individual ceased to be an Employee.
The Plan and its related trust are intended to be a tax-exempt plan and
trust under sections 401(a) and 501(a) of the Code, respectively. The Plan also
is intended to be a profit-sharing plan that contains a qualified cash or
deferred arrangement under section 401(k) of the Code.
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ARTICLE I
DEFINITIONS
1.1 ACCOUNTS - means all of the accounts described in section 6.1, and
such other accounts that may be established on behalf of each Participant, to be
credited with contributions made on behalf of a Participant, adjusted for
earnings and losses as provided in the Plan and debited by Plan expenses
allocable to the Accounts, distributions, withdrawals and loans to the
Participant.
1.2 AFTER-TAX ACCOUNT - means the Account established to record
After-Tax Contributions made on a Participant's behalf other than those invested
in the Harris Stock Fund.
1.3 AFTER-TAX CONTRIBUTIONS - means the contributions described in
section 3.5.
1.4 BALANCED FUND - means the Balanced Fund described in Appendix A.
1.5 BASIC ACCOUNT - means the Account established to record the portion
of the Profit-Sharing Contributions allocable to a Participant's Compensation.
1.6 BENEFICIARY - means the person or persons entitled to receive any
benefits payable under the Plan on account of a Participant's death.
1.7 BREAK-IN-SERVICE - means a Period of Severance, as defined below.
1.8 CODE - means the Internal Revenue Code of 1986, as amended from
time to time.
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1.9 COMPENSATION - means the following items of remuneration which an
Employee earns for work or personal services performed for a Participating
Company:
(a) salary or wages, including lump sum merit increases;
(b) commission paid pursuant to a sales incentive plan;
(c) overtime premium, shift differential or additional compensation
in lieu of overtime premium;
(d) compensation in lieu of vacation;
(e) any annual bonus or incentive compensation payable in the
form of cash pursuant to the Harris Corporation Annual
Incentive Plan or any successor thereto or other similar plan
or award program adopted from time to time by a Participating
Company or Employment Unit employing the Employee or any stock
award made in lieu of an annual cash bonus or incentive
compensation;
(f) any compensation of a type described in items (a) through
(e) above which is paid as an employee contribution to the
Plan;
(g) any salary reduction contributions to a cafeteria plan
(within the meaning of section 125 of the Code) maintained by
a Participating Company;
but excluding:
(i) any extraordinary compensation of a recurring or
non-recurring nature not included under items (a) through (g)
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above, including one-time recognition awards and rewards under a
referral program of a Participating Company;
(ii) any award made or amount paid pursuant to the Harris
Corporation Stock Incentive Plan or any successor thereto,
including, but not limited to, performance shares, stock options,
restricted stock, stock appreciation rights or other stock-based
awards or dividend equivalents;
(iii) severance pay or special retirement pay;
(iv) retention bonuses or completion bonuses, unless
authorized by the Retirement Committee in a uniform and
nondiscriminatory manner; and
(v) reimbursement or allowances with respect to expenses
incurred in connection with employment, such as tax equalization,
reimbursement for moving expenses, mileage or expense allowance or
education expenses.
In no event does the term "Compensation" include indirect compensation such as
employer-paid group insurance premiums or contributions under this or other
qualified employee benefit plan, other than as a contribution described in items
(f) and (g) above.
Only compensation not in excess of $160,000 (as adjusted for increases
in the cost of living pursuant to section 401(a)(17)(B) of the Code) shall be
taken into account. In addition, in the year in which any Employee becomes a
Participant, only Compensation received after he becomes a Participant shall
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be taken into account. For purposes of any test imposed under any section of the
Code, the Plan authorizes the use of any definition of Compensation that
satisfies the requirements of such section.
1.10 CONSOLIDATED SUBSIDIARIES - means those subsidiaries of the
Corporation which are included in the consolidated annual financial statements
for the Corporation.
1.11 CORPORATION - means Harris Corporation, a Delaware corporation.
1.12 DISABILITY - means a disability that qualifies a Participant for
disability benefits under title II or title XVI of the Federal Social Security
Act; such disability for Plan purposes shall be deemed to occur on the effective
date determined by the Social Security Administration.
1.13 EARLY RETIREMENT AGE - means age 55.
1.14 EMPLOYMENT UNIT - means any division or other readily identifiable
segment of the operations of a Participating Company, for example, as identified
in the annual report or such other segment as may be established for purposes of
the Plan by the Corporation, in its discretion.
1.15 EMPLOYEE - means an individual who is reported on the payroll
records of the Corporation or other Participating Company as an employee unless
the individual's employment relationship is covered by a collective bargaining
agreement that does not provide for such individual's participation in the Plan.
No individual who renders services to a Participating Company shall be
considered an Employee for purposes of the Plan if such individual renders such
services pursuant to (i) a written agreement providing that such
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services are to be rendered by the individual as an independent contractor, (ii)
a written agreement with an entity, including a leasing organization within the
meaning of section 414(n)(2) of the Code, that is not a Participating Company or
Related Company (a "Leased Employee"), or (iii) a written agreement that
contains a waiver of participation in the Plan. In particular, it is expressly
intended that any individuals not treated as employees by a Participating
Company on its payroll records is to be excluded from Plan participation even if
a court or administrative agency determines that such an individual is a common
law employee of a Participating Company. With respect to a Participating Company
not all of whose employees are eligible to participate in the Plan (a "Limited
Participating Company"), the term "Employee" shall include those employees of
the Participating Company who were Participants immediately prior to their
commencement of employment by the Limited Participating Company. A Leased
Employee shall be treated as an Employee only for purposes of applying the
requirements described in section 414(n)(3) of the Code and determining the
number and identity of Highly Compensated Employees.
1.16 ERISA - means the Employee Retirement Income Security Act of 1974,
as amended from time to time.
1.17 EXCESS COMPENSATION - means the portion of a Participant's
Compensation that exceeds the Taxable Wage Base for the year in which the
Compensation is received.
1.18 FISCAL YEAR - means the fiscal year of the Corporation.
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1.19 FULL-TIME EMPLOYEE - means an Employee who is scheduled by a
Participating Company to work 30 or more hours per week.
1.20 HARRIS STOCK FUND - means the Fund described in Appendix A that is
designed to be invested in qualifying employer securities within the meaning of
section 407 of ERISA.
1.21 HARRIS STOCK AFTER-TAX ACCOUNT - means the portion of the
After-Tax Contributions made on a Participant's behalf invested in the Harris
Stock Fund.
1.22 HARRIS STOCK MATCHING ACCOUNT - means the portion of the Matching
Contributions made on a Participant's behalf invested in the Harris Stock Fund.
1.23 HARRIS STOCK PRE-TAX ACCOUNT - means the portion of the Pre-Tax
Contributions made on a Participant's behalf invested in the Harris Stock Fund.
1.24 HIGHLY COMPENSATED EMPLOYEE - means, for a Plan Year, any Employee
who is:
(a) a 5%-owner (as determined under section 416(i)(1) of the
Code) of an Employer at any time during the Plan Year or the preceding Plan
Year; or
(b) paid Compensation in excess of $80,000 (as adjusted for
increases in the cost of living pursuant to section 414(q)(1)(B)(ii) of the
Code) from an Employer for the preceding Plan Year. The Employees taken into
account under this paragraph (b) for each Plan Year shall be limited to those
Employees who were members of the top-paid group (as defined in section
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414(q)(3) of the Code) for the preceding Plan Year, unless otherwise elected by
the Company for such Plan Year in accordance with applicable law.
1.25 HOUR OF SERVICE - means each hour for which an Employee is paid or
entitled to payment for the performance of duties for a Participating Company or
Related Company.
1.26 INVESTMENT COMMITTEE - means the Investment Committee - Retirement
Plans of the Corporation's Board of Directors.
1.27 INVESTMENT FUNDS - means the funds described in Appendix A and any
other fund designated by the Investment Committee.
1.28 LEAVE OF ABSENCE - means a period of interruption of the active
employment of an Employee granted by a Participating Company or Predecessor
Company with the understanding that the Employee will return to active
employment at the expiration of the period of time. A Leave of Absence as
originally granted may be extended by the Participating Company or Predecessor
Company for additional periods. The term "Leave of Absence" does not include a
Military Leave.
1.29 MATCHING AFTER-TAX ACCOUNT - means the Account established to
record Matching After-Tax Contributions made on a Participant's behalf other
than those invested in the Harris Stock Fund.
1.30 MATCHING AFTER-TAX CONTRIBUTIONS - means the contributions made on
behalf of a Participant under section 3.6.
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1.31 MATCHING CONTRIBUTIONS - means the aggregate of the Matching
After-Tax Contributions and the Matching Pre-Tax Contributions made on behalf of
a Participant.
1.32 MATCHING PRE-TAX ACCOUNT - means the Account established to record
the Matching Pre-Tax Contributions made on a Participant's behalf other than
those invested in the Harris Stock Fund.
1.33 MATCHING PRE-TAX CONTRIBUTIONS - means the contributions made on
behalf of a Participant under section 3.4.
1.34 MILITARY LEAVE - means, effective December 12, 1994, an Employee's
absence from active employment with a Participating Company or Predecessor
Company for a period of service in the "uniformed services", within the meaning
of the Uniformed Services Employment and Reemployment Rights Act of 1994, as
amended, which entitles the person rendering such service to reemployment under
such Act.
1.35 NORMAL RETIREMENT AGE - means age 65.
1.36 PARTICIPANT - means an Employee who satisfies the requirements of
section 2.1.
1.37 PARTICIPATING COMPANY - means the Corporation or any Related
Company or division or operation thereof so designated by the Corporation,
including a foreign subsidiary. Appendix C, as it may be amended from time to
time, lists each Participating Company, or division thereof, whose Employees may
become Participants.
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1.38 PERIOD OF SERVICE - means the period of time that begins on an
Employee's employment or reemployment date, whichever is applicable, and ends on
his Severance from Service Date. An Employee's employment date is the date on
which the Employee first performs an Hour of Service; an Employee's reemployment
date is the date on which the Employee first performs an Hour of Service after
his most recent Severance from Service Date.
1.39 PERIOD OF SEVERANCE - means the period of time commencing on the
Severance from Service Date and ending on the date on which the Employee again
performs an Hour of Service.
1.40 PLAN - means the Harris Corporation Retirement Plan.
1.41 PLAN YEAR - means the Fiscal Year.
1.42 PREDECESSOR COMPANY - means any corporation (a) of which a Related
Company is a successor by reason of having acquired all or substantially all of
its business and assets by purchase, merger, consolidation or liquidation, or
(b) from which a Related Company acquired a business formerly conducted by such
corporation; provided, however, that in the case of any such corporation that
continued to conduct a trade or business subsequent to the acquisition by a
Related Company referred in (a) or (b) above, the status of such corporation as
a Predecessor Company relates only to the period of time prior to the date of
such acquisition.
1.43 PRE-TAX ACCOUNT -means the Account established to record the
Pre-Tax Contributions made on a Participant's behalf other than those invested
in the Harris Stock Fund.
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1.44 PRE-TAX CONTRIBUTIONS - means the contributions made on behalf of
a Participant under section 3.3.
1.45 PROFIT-SHARING ACCOUNT - means the Account established to record
the Profit-Sharing Contributions made on a Participant's behalf, and includes
the Basic Account and the Supplemental Account.
1.46 PROFIT-SHARING CONTRIBUTIONS - means the contributions described
in section 3.1.
1.47 RELATED COMPANY - means the Corporation or any corporation that is
a member of a controlled group of corporations (as defined in section 414(b) of
the Code) with the Corporation; any trade or business (whether or not
incorporated) which is under common control (as defined in section 414(c) of the
Code) with the Corporation; any organization (whether or not incorporated) which
is a member of an affiliated service group (as defined in section 414(m) of the
Code) which includes the Corporation, or any other entity required to be
aggregated with the Corporation under section 414(o) of the Code.
1.48 RELEASE EMPLOYEE -An employee of the Corporation who is
transferred by the Corporation to a Related Company (other than a Participating
Company) and who is designated by the Retirement Plan Administrative Committee
as a Release Employee for purposes of receiving a Profit-Sharing Contribution
for the Plan Year in which such transfer occurred.
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1.49 RETIREMENT PLAN ADMINISTRATIVE COMMITTEE - means the committee
established pursuant to Section 11.2.
1.50 ROLLOVER ACCOUNT - means the Account established to record the
rollover contributions made by a Participant pursuant to section 3.8.
1.51 SAVINGS ACCOUNT - means the Account established under section
6.1(f).
1.52 SERP -means the Harris Corporation Supplemental Executive
Retirement Plan, as it may be amended from time to time.
1.53 SEVERANCE FROM SERVICE DATE - means, with respect to a Related
Company, the earlier of (a) the date on which the Employee quits, retires, is
discharged or dies, and (b) the first anniversary of the first date of a period
in which an Employee remains absent from service (with or without pay) for any
reason other than quitting, retirement, discharge or death; provided that
"second anniversary" shall be substituted for "first anniversary" if the absence
is due to maternity or paternity reasons as defined in section 410(a)(5)(E) of
the Code. The period between the first and the second anniversary shall not be a
Period of Service or a Period of Severance.
1.54 SUPPLEMENTAL ACCOUNT - means the Account established to record the
portion of a Participant's Profit-Sharing Contribution allocable to the
Participant's Excess Compensation.
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1.55 TAXABLE WAGE BASE - means the maximum amount of earnings that may
be considered wages under section 3121(a)(1) of the Code, except for purposes of
Medicare taxes, as in effect on the first day of the Plan Year. In the case of
an Employee who was a Participant for only a portion of a particular Plan Year,
the Taxable Wage Base shall be multiplied by the ratio of the number of calendar
months (including a fraction of a month as a full month) in the Plan Year during
which he was a Participant to 12 months.
1.56 TRUST AGREEMENT - means the Trust Agreement relating to the Harris
Corporation Retirement Plan, entered into between the Corporation and the
Trustee, as it may be amended from time to time.
1.57 TRUST FUND - means the assets held by the Trustee in accordance
with the Trust Agreement.
1.58 TRUSTEE - means Bankers Trust Company, or such successor (or
successors) thereto designated by the Corporation to act as trustee under the
provisions of the Trust Agreement, who shall agree to act as such by executing
the Trust Agreement.
1.59 VALUATION DATE - means each day the New York Stock Exchange is
open and any other day as the Retirement Plan Administrative Committee may
determine.
ARTICLE II
PARTICIPATION
2.1 IN GENERAL. An Employee shall become a Participant in the Plan on
the date he completes a one-year Period of Service, provided that he is
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employed by a Participating Company on that date. Notwithstanding the above, and
solely for purposes of making Pre-Tax Contributions, After-Tax Contributions and
Rollover Contributions, a Full-Time Employee shall become a Participant in the
Plan on the date he first performs an Hour of Service.
2.2 RENEWAL OF PARTICIPATION ON REEMPLOYMENT. An Employee who
terminates employment after he completes a one-year Period of Service and is
reemployed by a Participating Company shall become a Participant immediately on
reemployment. An Employee who terminates employment before he completes a
one-year Period of Service shall become a Participant as provided in section
2.1, provided that his Period of Service prior to reemployment shall be used to
satisfy the one-year Period of Service requirement of section 2.1 to the extent
provided under section 2.3.
2.3 PERIODS OF SERVICE ON REEMPLOYMENT. The following rules shall apply
to an Employee who terminates employment before he completes a one-year Period
of Service and is re-employed by a Related Company:
(a) CREDIT FOR PRIOR PERIOD OF SERVICE. If the Employee is
re-employed by a Related Company before his Period of Severance equals or
exceeds the greater of (i) his Period of Service before he terminated employment
and (ii) five years, then his Period of Service before he terminated employment
shall be taken into account in determining whether the Employee has completed a
one-year Period of Service for purposes of section 2.1 and for purposes of
determining a Participant's Period of Service under section 5.3.
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(b) CREDIT FOR PERIOD OF SEVERANCE. If the Employee terminates
employment due to quitting, discharge, or retirement and is re-employed by a
Related Company within 12 months of his termination date, his Period of
Severance shall be taken into account in determining whether the Employee has
completed a one-year Period of Service for purposes of section 2.1 and for
purposes of determining a Participant's Period of Service under section 5.3. If
the Employee terminates employment for any reason other than quitting,
discharge, or retirement, and subsequently quits, is discharged, or retires, his
Period of Severance shall be taken into account in determining whether the
Employee has completed a one-year Period of Service for purposes of section 2.1
and for purposes of determining a Participant's Period of Service under section
5.3 only if he is re-employed by a Related Company within 12 months of the date
of his termination of employment.
2.4 SERVICE WITH PREDECESSOR COMPANY. In the case of a corporation
(other than a Related Company) that becomes a Predecessor Company by reason of
the acquisition of all or substantially all of the assets and business of such
corporation by a Related Company, an Employee's Period of Service shall include
employment with such Predecessor Company only to the extent expressly provided
in the corporate documents effecting the acquisition.
2.5 MILITARY LEAVE. Notwithstanding any provision of the Plan to the
contrary, effective December 12, 1994, (i) a Participant who returns to
employment after a period of Military Leave may elect to make Pre-Tax
Contributions and After-Tax Contributions to the Plan in respect of such period
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of Military Leave and (ii) the Participating Company that employs such a
Participant shall make any Profit-Sharing Contributions and Matching
Contributions on behalf of such Participant to the Plan upon the Participant's
reemployment to the extent required by applicable law and in accordance with
section 414(u) of the Code.
ARTICLE III
CONTRIBUTIONS AND ALLOCATIONS
3.1 PROFIT-SHARING CONTRIBUTIONS.
(a) BASIC. The amount of Profit-Sharing Contributions made on
behalf of Participating Companies for a Fiscal Year with respect to Participants
in the Plan shall equal 11 1/2 percent of the adjusted consolidated neT income
of the Corporation and its Consolidated Subsidiaries before net income taxes for
such Fiscal Year as determined in subsection (c), reduced by the portion of such
amount with respect to Participants' Compensation that would have been allocable
under section 3.2 of the Plan if Compensation were determined without regard to
statutory limits under section 401(a)(17) or 415 of the Code.
(b) SPECIAL. The Corporation, in its discretion, may provide for an
additional Profit-Sharing Contribution in a specified dollar amount or pursuant
to a formula with respect to any Fiscal Year.
(c) ADJUSTED CONSOLIDATED NET INCOME. The adjusted consolidated net
income of the Corporation and its Consolidated Subsidiaries before net income
taxes shall be determined on the basis of the annual audit report prepared by
the Corporation's independent public accountants by adjusting
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the consolidated net income shown in the report to eliminate the effect, if any,
of the following items:
(1) any provision for taxes on or measured by income for such
years required by the laws of the United States or of any
state or political subdivision thereof (including, however,
any taxes required under the Ohio Franchise Income Tax,
whether or not in fact measured by income), or any provision
for similar taxes required by the laws of any other country;
(2) all items consisting of credits or deficiencies relating to
taxes described in clause (1) above on or measured by income
for prior Fiscal Years;
(3) any provision for contributions for such Fiscal Year under
this Plan or under any profit-sharing retirement plan of a
Consolidated Subsidiary of the Corporation;
(4) all dividends received during such Fiscal Year with respect to
stock of a Related Company which is not included among the
Consolidated Subsidiaries;
(5) gains or losses from the sale, exchange or other disposition
of capital or depreciable property, as defined in the Code;
(6) any income from the use of the "lifo" inventory method
resulting from either a reduction in inventory or a decrease
in the cost index;
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(7) all items of income and expense which relate directly to the
conduct by a Related Company of a business (i) which was
formerly conducted by a corporation which was not then a
Related Company, and (ii) the net income (or loss) of which
was included for the first time in determining the
consolidated net income of the Corporation and its
Consolidated Subsidiaries for the Fiscal Year in question;
(8) all exchange adjustments resulting from translating to United
States currency those year-end balance sheet items of
subsidiaries which are denominated in a foreign currency; and
(9) any item of income or expense relating to the right of any
employee to receive cash upon cancellation of an unexercised
stock option.
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3.2 ALLOCATION OF PROFIT-SHARING CONTRIBUTION TO PARTICIPANTS.
(a) IN GENERAL. The Profit-Sharing Contributions for a Plan Year
with respect to an Employment Unit shall be allocated among eligible
Participants described in subsection (c) who are employed by the Employment Unit
during some part or all of the Plan Year based on the ratio of each eligible
Participant's Compensation plus Excess Compensation for the Plan Year to the
Compensation plus Excess Compensation of all eligible Participants for the Plan
Year.
(b) LIMITATION ON AMOUNT. Notwithstanding subsection (a), the
amount allocated to an eligible Participant with respect to Excess Compensation
shall not exceed the "base contribution percentage" by more than the lesser of
(i) the base contribution percentage and (ii) 5.7% (or if greater, the
percentage equal to the Old Age portion of the tax under section 3111(a) of the
Code, as in effect on the first day of the Plan Year). Any remaining amount
shall be allocated based on the ratio of each Participant's Compensation for the
Plan Year to the Compensation of all eligible Participants for the Plan Year.
The term "base contribution percentage" means the percentage of Compensation
contributed by the Participating Company with respect to each Participant's
Compensation not in excess of the Participant's Taxable Wage Base.
(c) LIMITATION ON ELIGIBILITY. A Participant shall be eligible to
receive an allocation of Profit-Sharing Contributions for a Plan Year if (i) the
Participant is employed on the earlier of (A) the last day of the Plan Year and
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<PAGE> 27
(B) the June 30 nearest to the last day of the Plan Year or (ii) the Participant
terminated employment during the Plan Year on or after Early Retirement Age or
Normal Retirement Age, or due to Disability, death, reduction-in-force program,
Leave of Absence or Military Leave, or is transferred by the Corporation as a
Release Employee to an entity that is not a Participating Company.
3.3 PRE-TAX CONTRIBUTIONS.
(a) CONTRIBUTION ELECTION. Each Participant shall be deemed to
have elected to defer 6% of his Compensation for a Plan Year in the form of
Pre-Tax Contributions, to become effective as of the first payroll period as
soon as administratively practicable following his satisfaction of the
participation requirements set forth in Section 2. 1, unless the Participant
elects otherwise prior to such payroll period in the time and manner prescribed
by the Retirement Plan Administrative Committee. If a Participant who elects not
to make Pre-Tax Contributions to the Plan in accordance with the foregoing
sentence subsequently decides to make Pre-Tax Contributions to the Plan, such
Participant's election to make Pre-Tax Contributions shall become effective as
of the first payroll period commencing immediately after the effective date of
the election or such later date as may be administratively practicable. An
election shall remain in effect until revised or revoked. Pre-Tax Contributions
shall be contributed to the Plan in cash; PROVIDED, that the Corporation, in its
discretion, may contribute Pre-Tax Contributions to be invested in the Harris
Stock Fund in shares of common stock of the
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Corporation, which may be contributed at a discount from fair market value. The
sum of the Pre-Tax Contributions and other elective deferrals (within the
meaning of section 402(g)(3)) made on behalf of the Participant to the Plan and
any other plan of a Participating Company or Related Company for any calendar
year shall not exceed $10,000 (as adjusted in accordance with section 402(g)(5)
for increases in the cost of living). The portion of any Pre-Tax Contribution
made on behalf of a Participant that is attributable to a discount from fair
market value on shares of common stock of the Corporation shall be disregarded
for the purposes of determining (i) whether the Participant's Pre-Tax
Contributions exceed 12 percent of his Compensation for the Plan Year, and (ii)
whether the Participant's Pre-Tax Contributions and other elective deferrals
exceed $10,000 (as adjusted in accordance with section 402(g)(5) for increases
in the cost of living) for the calendar year.
(b) CONTRIBUTIONS IN EXCESS OF THE MAXIMUM. If the Pre-Tax
Contributions on behalf of a Participant for a calendar year reach the limit
described in subsection (a), any additional contributions to be made during the
calendar year pursuant to the Participant's election shall be made as After-Tax
Contributions and any Matching Pre-Tax Contributions with respect to that amount
shall be made as Matching After-Tax Contributions. Notwithstanding the above, if
the Pre-Tax Contributions for a calendar year on behalf of a Participant who is
eligible to participate in the SERP reach the limit described in subsection (a),
such Participant may elect (i) that any additional contributions be made as
After-Tax Contributions and any Matching Pre-Tax
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Contributions with respect to that amount be made as Matching After-Tax
Contributions or (ii) that such amounts (including the amount of the Matching
Contributions) be credited to the Participant's account under the SERP. Such
election shall be made at the time and in accordance with procedures established
by the Retirement Plan Administrative Committee.
3.4 MATCHING PRE-TAX CONTRIBUTIONS. Each Participating Company shall
make a Matching Pre-Tax Contribution to the Plan on behalf of each Participant
who is employed by such Participating Company and has completed a one-year
Period of Service in the amount of 100 percent of the Pre-Tax Contributions made
on behalf of the Participant for the Plan Year, but only to the extent that such
Pre-Tax Contributions do not exceed six percent of the Participant's
Compensation for such Plan Year. Matching Pre-Tax Contributions shall be
contributed in cash; provided, that the Corporation, in its discretion, may
contribute Matching Pre-Tax Contributions to be invested in the Harris Stock
Fund in shares of common stock of the Corporation, which may be contributed at a
discount from fair market value. The portion of any Matching Pre-Tax
Contribution made on behalf of a Participant for a Plan Year that is
attributable to a discount from fair market value on shares of common stock of
the Corporation shall be disregarded for the purpose of determining whether the
Matching Pre-Tax Contributions made on behalf of the Participant exceed six
percent of the Participant's Compensation for such Plan Year.
3.5 AFTER-TAX CONTRIBUTIONS. A Participant may elect to contribute to
the Plan as an After-Tax Contribution an amount equal to any whole
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<PAGE> 30
percentage of his Compensation for such Plan Year not exceeding 12 percent.
After-Tax Contributions shall be contributed in cash; provided, that the
Corporation, in its discretion, may contribute After-Tax Contributions to be
invested in the Harris Stock Fund in shares of common stock of the Corporation,
which may be contributed at a discount from fair market value. The portion of
any After-Tax Contribution made by a Participant for a Plan Year that is
attributable to a discount from fair market value on shares of common stock of
the Corporation shall be disregarded for the purpose of determining whether the
Participant's After-Tax Contributions exceed 12 percent of his Compensation for
such Plan Year.
3.6 MATCHING AFTER-TAX CONTRIBUTIONS. Each Participating Company shall
make a Matching After-Tax Contribution to the Plan on behalf of each Participant
who is employed by such Participating Company in the amount of 100 percent of
the After-Tax Contributions made by the Participant for the Plan Year, but only
to the extent that such After-Tax Contributions do not exceed six percent of the
Participant's Compensation for such Plan Year. Matching After-Tax Contributions
shall be contributed in cash; provided, that the Corporation, in its discretion,
may contribute Matching After-Tax Contributions to be invested in the Harris
Stock Fund in shares of common stock of the Corporation, which may be
contributed at a discount from fair market value. The portion of any Matching
After-Tax Contribution made on behalf of a Participant for a Plan Year that is
attributable to a discount from fair market value on shares of common stock of
the Corporation shall be disregarded for
23
<PAGE> 31
the purpose of determining whether the Matching After-Tax Contributions made on
behalf of the Participant exceed six percent of the Participant's Compensation
for such Plan Year.
3.7 ELECTIONS TO MAKE PRE-TAX AND AFTER-TAX CONTRIBUTIONS.
(a) INITIAL ELECTIONS. If a Participant elects not to begin making
automatic Pre-Tax Contributions to the Plan in accordance with the first
sentence of Section 3.3(a), the Participant may subsequently elect to
subsequently begin making Pre-Tax Contributions to the Plan by filing the
appropriate form or by following the appropriate telephone procedures
established by the Retirement Plan Administrative Committee. A Participant may
elect to begin making After-Tax Contributions by filing the appropriate form or
by following the appropriate telephone procedures established by the Retirement
Plan Administrative Committee. Any election made under this Section 3.7(a) shall
become effective as of the first payroll period commencing immediately after the
later of the date on which the Employer receives the Participant's election, the
date designated by the Participant in his election or such later date as may be
administratively practicable.
(b) CHANGING ELECTIONS. A Participant may change the percentage
(in increments of one percent) of future Pre-Tax Contributions and/or After-Tax
Contributions made on his behalf by filing the appropriate form or by following
the appropriate telephone procedures for changing elections as established by
the Retirement Plan Administrative Committee. A change may be made not more than
once each payroll period. A change of
24
<PAGE> 32
election shall become effective as of the first payroll period commencing
immediately after the date of the election, or such later date as may be
administratively practicable.
(c) TERMINATING ELECTIONS. A Participant may terminate his
election to have Pre-Tax Contributions and/or After-Tax Contributions made on
his behalf by filing the appropriate form. The termination election shall become
effective as of the first payroll period commencing immediately after the date
of the election, or such later date as may be administratively practicable.
(d) CORPORATION'S DISCRETION TO LIMIT ELECTION. The Retirement
Plan Administrative Committee may direct that Participant elections with respect
to Pre-Tax Contributions and/or After-Tax Contributions be changed in any manner
the Retirement Plan Administrative Committee, in its discretion, shall determine
appropriate to preserve the qualification of the Plan under section 401(a) of
the Code and as a qualified cash or deferred arrangement under section 401(k) of
the Code.
3.8 ROLLOVER CONTRIBUTIONS. A Participant, with the consent of the
Retirement Plan Administrative Committee or its delegate, may at any time make a
rollover contribution to the Plan. Rollover contributions shall include only (a)
cash funds transferred directly from a tax-qualified plan within the meaning of
section 401 of the Code, and (b) cash funds distributed from a tax-qualified
plan or a conduit individual retirement account that are eligible for rollover
treatment and are transferred to the Plan within 60 days of the Participant's
receipt thereof. A Participant may be required to establish that
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<PAGE> 33
the transfer of amounts into a Rollover Account will not require any changes to
the terms of the Plan or will not expose the Plan or Trust to adverse tax
consequences.
3.9 PARTICIPATING COMPANY'S OBLIGATION TO MAKE CONTRIBUTIONS.
(a) CONTRIBUTIONS. Each Participating Company agrees to pay to the
Trustee the contributions that are required with respect to Participants who are
performing services at one of such Participating Company's Employment Units.
Profit-Sharing Contributions with respect to a Fiscal Year shall be paid to the
Trustee no later than the due date for filing the Participating Company's
federal income tax return for such Fiscal Year, including extensions. Pre-Tax
Contributions and After-Tax Contributions shall be withheld and paid by the
Employment Unit, and Matching Contributions shall be paid by the Participating
Company to the Trustee no later than 20 days following the last day of the
calendar month in which the amounts were withheld from the Participants'
Compensation, or sooner as required by Federal law.
(b) LIMITATION. Contributions under this Article III shall not be
required to the extent they exceed the deduction limitations of section 404 of
the Code, in which case such contributions shall be reduced to the extent
allowable and necessary in the following order: (1) Profit-Sharing
Contributions; (2) Matching Contributions; and (3) Pre-Tax Contributions.
3.10 TREATMENT OF FORFEITED AMOUNTS.
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(a) REDUCTION OF CONTRIBUTIONS. Forfeitures shall be allocated to
Employment Units as provided in subsection (b) and used to reduce Profit-Sharing
Contributions and Matching Contributions of the Participating Companies in which
the Employment Units are included.
(b) ALLOCATION OF FORFEITURES TO EMPLOYMENT UNITS. Forfeitures of
Profit-Sharing Contributions and Matching Contributions shall be credited to the
Employment Unit with which the Participant was last employed before the
forfeiture occurred, or as otherwise determined by the Retirement Plan
Administrative Committee.
3.11 FINALITY OF ALLOCATIONS. The Retirement Plan Administrative
Committee shall cause a written benefit statement to be given to each
Participant at least annually setting forth the amount of the contributions
allocated to his Accounts; provided, however, that if any such Participant is
deceased, such statement shall be given to his Beneficiary. Any Participant or
Beneficiary claiming that an error has been made in a benefit statement shall
notify the Retirement Plan Administrative Committee in writing within 90 days
following the delivery or mailing of such statement. The Retirement Plan
Administrative Committee shall review the claim and advise the Participant or
Beneficiary of its decision in writing. If no such notice of error is filed, the
benefit statement shall be presumed to be correct.
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ARTICLE IV
LIMITATIONS ON CONTRIBUTIONS
4.1 IN GENERAL. Notwithstanding any provisions of Article III to the
contrary, the contributions provided for in Article III shall be limited to the
extent necessary to meet the requirements of this Article IV.
4.2 PRE-TAX CONTRIBUTIONS.
(a) TREATMENT OF CERTAIN CONTRIBUTIONS AS AFTER-TAX. If the
Retirement Plan Administrative Committee determines that a Participant's Pre-Tax
Contributions for a calendar year have reached the dollar limit described in
section 3.3(a), any additional contributions for that calendar year pursuant to
the Participant's Pre-Tax Contribution election shall be treated in the manner
provided under section 3.3.
(b) RETURN OF EXCESS DEFERRALS. In the event that a Participant's
Pre-Tax Contributions made to the Plan for a calendar year exceed the dollar
limit described in section 3.3(a), the excess amount, as adjusted for income and
loss, may, in the discretion of the Retirement Plan Administrative Committee, be
distributed to the Participant no later than April 15 of the following year in
accordance with the requirements of section 402(g) of the Code and Treasury
Regulation section 1.402(g)-1 (or transferred to the SERP in accordance with a
timely election filed by the Participant).
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4.3 LIMITATIONS ON CONTRIBUTIONS FOR HIGHLY COMPENSATED EMPLOYEES.
Effective December 31, 1996,
(a) LIMITS IMPOSED BY SECTION 401(K)(3) OF THE CODE.
Notwithstanding the provisions of Section 3.3, if the Pre-Tax Contributions made
for a Plan Year fail to satisfy both of the tests set forth in subparagraphs (1)
and (2) of this paragraph, the adjustments prescribed in Section 4.3(e)(1) shall
be made.
(1) The average deferral percentage for the group consisting of
all highly compensated Employees for the Plan Year does not
exceed the product of the average deferral percentage for the
group consisting of all non-highly compensated Employees for
the immediately preceding Plan Year and 1.25.
(2) The average deferral percentage for the group consisting of
all highly compensated Employees for the Plan Year (i) does
not exceed the average deferral percentage of the group
consisting of all non-highly compensated Employees for the
immediately preceding Plan Year by more than 2 percentage
points, and (ii) does not exceed the product of the average
deferral percentage of the group consisting of all non-highly
compensated Employees for the immediately preceding Plan Year
and 2.0.
(b) LIMITS IMPOSED BY SECTION 401(m) OF THE CODE. Notwithstanding
the provisions of Sections 3.1, 3.4 and 3.6, if the aggregate of
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<PAGE> 37
the Matching Contributions and After-Tax Contributions made for a Plan Year fail
to satisfy both of the tests set forth in subparagraphs (1) and (2) of this
paragraph, the adjustments prescribed in Section 4.3(e)(2) shall be made.
(1) The average contribution percentage for the group consisting
of all highly compensated Employees for the Plan Year does not
exceed the product of the average contribution percentage for
the group consisting of all non-highly compensated Employees
for the immediately preceding Plan Year and 1.25.
(2) The average contribution percentage for the group consisting
of all highly compensated Employees for the Plan Year (i) does
not exceed the average contribution percentage of the group
consisting of all non-highly compensated Employees for the
immediately preceding Plan Year by more than 2 percentage
points, and (ii) does not exceed the product of the average
contribution percentage of the group consisting of all
non-highly compensated Employees for the immediately preceding
Plan Year and 2.0.
(c) AGGREGATE LIMIT ON CONTRIBUTION. Notwithstanding anything
herein to the contrary, if the aggregate of the Pre-Tax Contributions, Matching
Contributions and After-Tax Contributions made for a Plan Year fail to satisfy
all of the tests set forth in subparagraphs (1), (2) and (3) of this paragraph,
the adjustments prescribed in Section 4.3(e)(3) shall be made.
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(1) The average deferral percentage for the group consisting of
highly compensated Employees for the Plan Year does not exceed
the product of the average deferral percentage for the group
consisting of all non-highly compensated Employees for the
immediately preceding Plan Year and 1.25.
(2) The average contribution percentage for the group consisting
of highly compensated Employees for the Plan Year does not
exceed the product of the average contribution percentage for
the group consisting of all non-highly compensated Employees
for the immediately preceding Plan Year and 1.25.
(3) The sum of the average deferral percentage (as determined
under Section 4.3(d)(1) after making the adjustments required
by Section 4.3(e)(1) for the Plan Year) and the average
contribution percentage (as determined under Section 4.3(d)(2)
after making the adjustments required by Section 4.3(e)(2) for
the Plan Year) for the group consisting of highly compensated
Employees for the Plan Year does not exceed the aggregate
limit for such Plan Year.
(d) DEFINITIONS AND SPECIAL RULES. For purposes of this Section:
(1) The "average deferral percentage"
(i) for the group of highly compensated Employees for a Plan
Year shall be the average of the ratios, calculated separately
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<PAGE> 39
for each Employee in such group to the nearest one-hundredth of one
percent, of the Pre-Tax Contributions made for the benefit of such
Employee to the total compensation for such Plan Year paid to such
Employee, and
(ii) for the group of non-highly compensated Employees for the
immediately preceding Plan Year shall be the average of the ratios,
calculated separately for each Employee in such group to the
nearest one-hundredth of one percent, of the Pre-Tax Contributions
made for the benefit of such Employee for the immediately preceding
Plan Year to the total compensation for the immediately preceding
Plan Year paid to such Employee.
(2) The "average contribution percentage"
(i) for the group of highly compensated Employees for a
Plan Year shall be the average of the ratios, calculated separately
for each Employee in such group to the nearest one-hundredth of one
percent, of the Matching Contributions, the After-Tax Contributions
and, in the Retirement Plan Administrative Committee's sole
discretion, to the extent permitted under rules prescribed by the
Secretary of the Treasury or otherwise under the law, the Pre-Tax
Contributions made during such year for the benefit of such
Employee to such Employee's compensation for such Plan Year, and
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<PAGE> 40
(ii) for the group of non-highly compensated Employees for the
immediately preceding Plan Year shall be the average of the ratios,
calculated separately for each Employee in such group to the nearest
one-hundredth of one percent, of the Employer matching contributions,
After-Tax Contributions and, in the Retirement Plan Administrative
Committee's sole discretion, to the extent permitted under rules
prescribed by the Secretary of the Treasury or otherwise under the law,
the Pre-Tax Contributions made during the immediately preceding Plan
Year for the benefit of such Employee to such Employee's compensation
for the immediately preceding Plan Year.
(3) The "aggregate limit" shall equal the greater of (A) the sum
of (i) 1.25 times the greater of the average deferral
percentage or the average contribution percentage for the
immediately preceding Plan Year for the group consisting of
non-highly compensated Employees for such immediately
preceding Plan Year, plus (ii) the lesser of (a) the sum of
two percentage points and the lesser of the average deferral
percentage or the average contribution percentage for the
immediately preceding Plan Year for the group consisting of
all non-highly compensated Employees for such immediately
preceding Plan Year, and (b) 200% of the lesser of the average
deferral percentage or the average contribution percentage for
the
33
<PAGE> 41
immediately preceding Plan Year for the group consisting of
all non-highly compensated Employees for such immediately
preceding Plan Year, and (B) the sum of (i) 1.25 times the
lesser of the average deferral percentage or the average
contribution percentage for the immediately preceding Plan
Year for the group consisting of all non-highly compensated
Employees for such immediately preceding Plan Year, plus (ii)
the lesser of (a) the sum of two percentage points plus the
greater of the average deferral percentage or the average
contribution percentage for the immediately preceding Plan
Year for the group consisting of all non-highly compensated
Employees for such immediately preceding Plan Year, and (b)
200% of the greater of the average deferral percentage and the
average contribution percentage for the immediately preceding
Plan Year for the group consisting of all non-highly
compensated Employees for such immediately preceding Plan
Year;
(4) "highly compensated Employee" shall mean any Employee who has
become a Participant who performs services in the
determination year and is in one or more of the following
groups: (i) Employees who were five percent owners as
determined in section 416(i)(1)(A)(iii) of the Code at any
time during the determination year or the look-back year, or
(ii)
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Employees with compensation greater than $80,000 (adjusted for
increases in the cost of living as set forth in section 415(d)
of the Code) during the look-back year and who were in the
top-paid group during the look-back year. Any former Employee
who had a separation year prior to the determination year and
was a highly compensated Employee as described in any of
clauses (i) and (ii) above for either (A) his separation year
or (B) any determination year ending on or after this
attainment of age 55 shall be considered a "highly compensated
Employee". For purposes of determining whether a person is a
highly compensated Employee of a Participating Company with
respect to a Plan Year, the term "determination year" means
the Plan Year for which the determination is being made; the
term "look-back year" means the twelve-month period
immediately preceding the determination year; the term
"top-paid group" means the top 20% of employees of the
Participating Company ranked on the basis of compensation
received during the year (provided, however, that when
determining the number of employees in such group, employees
described in section 414(q)(8) of the Code and Q&A 9(b) of
Treasury Regulation Section 1.414(q)-IT are excluded);
"compensation" means compensation within the meaning of
section 415(c)(3) of the
35
<PAGE> 43
Code, including elective or salary reduction contributions to
a cafeteria plan, cash or deferred arrangement or
tax-sheltered annuity; employers aggregated under section
414(b), (c), (m) or (o) of the Code are treated as a single
employer; and "separation year" means the determination year
the Employee separates from service with the applicable
Participating Company.
(5) "non-highly compensated Employee" shall mean any Employee who
has become a Participant who performs services in the
determination year (as defined in subparagraph (4) of this
paragraph) and is not a highly compensated Employee.
(6) "compensation" shall have the meaning set forth in section
414(s) of the Code or, in the discretion of the Retirement
Plan Administrative Committee, any other meaning in accordance
with the Code for these purposes;
(7) if the Plan and one or more other plans of a Participating
Company or any of its affiliates to which pre-tax
contributions, matching contributions or employee
contributions (as such terms are defined for purposes of
section 401(m) of the Code), or qualified non-elective
contributions (as such term is defined in section 401(m)(4)(C)
of the Code), are made and treated as one plan for purposes
36
<PAGE> 44
of section 410(b) of the Code, such plans shall be treated as
one plan for purposes of this Section. If a highly compensated
Employee participates in the Plan and one or more other plans
of his employer or any of its affiliates to which any such
contributions are made, all such contributions shall be
aggregated for purposes of this Section.
(e) ADJUSTMENTS TO COMPLY WITH LIMITS. (1) ADJUSTMENTS TO COMPLY
WITH SECTION 401(k)(3) OF THE CODE. The Retirement Plan
Administrative Committee shall cause to be made such periodic
computations as it shall deem necessary or appropriate to
determine whether either of the tests set forth in Section
4.3(a)(1) or 4.3(a)(2) will be satisfied during a Plan Year
and, if it appears to the Retirement Plan Administrative
Committee that neither of such tests will be satisfied, the
Retirement Plan Administrative Committee shall take such steps
as it deems necessary or appropriate to adjust the Pre-Tax
Contributions made for all or a portion of the remainder of
such Plan Year on behalf of each Participant who is a highly
compensated Employee to the extent necessary in order for one
of such tests to be satisfied. If after the end of a Plan Year
it is determined that regardless of any such steps taken
neither of the tests set forth in
37
<PAGE> 45
Section 4.3(a)(1) or 4.3(a)(2) will be satisfied with respect
to such Plan Year, the Retirement Plan Administrative
Committee shall calculate a total amount by which Pre-Tax
Contributions must be reduced in order to satisfy either such
test, in the manner prescribed by section 401(k)(8)(B) of the
Code (the "excess contributions amount"). The amount of
Pre-Tax Contributions to be reduced for each Participant who
is a highly compensated Employee shall be determined by first
reducing the Pre-Tax Contributions of each Participant whose
actual dollar amount of Pre-Tax Contributions for such Plan
Year is the highest until such reduced dollar amount equals
the next highest actual dollar amount of Pre-Tax Contributions
made for such Plan Year on behalf of any highly compensated
Participant or until the total reduction equals the excess
contributions amount. If further reductions are necessary,
then such contributions on behalf of each Participant who is a
highly compensated Employee and whose actual dollar amount of
Pre-Tax Contributions made for such Plan Year is the highest
(determined after the reduction described in the previous
sentence) shall be reduced in accordance with the previous
sentence. Such reductions shall continue to be made to the
extent necessary so that the total reduction equals the
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<PAGE> 46
excess contributions amount. The amount by which Pre-Tax
Contributions are to be reduced in accordance with this
Section 4.3(e) shall be deemed to be After-Tax Contributions
and any Matching Pre-Tax Contributions made with respect to
such Pre-Tax Contributions shall be deemed to be After-Tax
Matching Contributions. The amount by which a Participant's
Pre-Tax Contributions are reduced in accordance with this
Section 4.3(e) shall be reduced by any Pre-Tax Contributions
previously distributed to such Participant pursuant to Section
4.2 for such Plan Year. The amount of any income allocable to
any such reductions shall be determined pursuant to
Regulations. The unadjusted amount of any reductions
distributed shall be treated as "annual additions" for
purposes of Section 4.4.
(2) ADJUSTMENTS TO COMPLY WITH SECTION 401(m) OF THE CODE. The
Retirement Plan Administrative Committee shall cause to be
made such periodic computations as it shall deem necessary or
appropriate to determine whether either of the tests set forth
in Section 4.3(b)(1) or 4.3(b)(2) will be satisfied during a
Plan Year with respect to the Plan, and if it appears to the
Retirement Plan Administrative Committee that neither of such
tests will be satisfied, the Retirement Plan Administrative
Committee shall take such steps as it deems
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necessary or appropriate to adjust the Matching Contributions
and the After-Tax Contributions made for all or a portion of
the remainder of such Plan Year on behalf of each Participant
who is a highly compensated Employee to the extent necessary
in order for one of such tests to be satisfied. If after the
end of a Plan Year it is determined that regardless of any
steps taken neither of the tests set forth in Section
4.3(b)(1) or 4.3(b)(2) will be satisfied with respect to such
Plan Year, the Retirement Plan Administrative Committee shall
calculate the maximum contribution percentage permissible for
Participants who are highly compensated Employees under the
tests set forth in Sections 4.3(b)(1) and 4.3(b)(2) and reduce
the Matching Contributions and After-Tax Contributions made on
behalf of each Participant who is a highly compensated
Employee and whose actual dollar amount of Matching
Contributions and After-Tax Contributions for such Plan Year
is the highest in the same manner described in subparagraph
(1) of this paragraph to the extent necessary to comply with
Section 4.3(b)(1) or 4.3(b)(2). The reduction described in the
foregoing sentence shall be made first with respect to a
Participant's After-Tax Contributions in excess of six percent
of Compensation, second with respect to any remaining
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After-Tax Contributions and any Matching After-Tax
Contributions attributable thereto, third with respect to any
Matching Pre-Tax Contributions. The Retirement Plan
Administrative Committee shall distribute (or transfer to the
SERP in accordance with a timely election filed by the
Participant) no later than the last day of the subsequent Plan
Year to each such Participant the amount of such reductions
made with respect to vested Matching Contributions and
After-Tax Contributions plus any income allocable thereto to
which such Participant would be entitled under the Plan if
such Participant had terminated service on the last day of the
Plan Year for which such contributions are made (or earlier if
such Participant actually terminates service at any earlier
date), and any remaining amount of such reductions plus any
income allocable thereto shall be forfeited and used to reduce
contributions in accordance with Section 3.10. The amount of
any such income allocable to any such reductions to be so
distributed or forfeited shall be determined pursuant to
Regulations.
(3) ADJUSTMENTS TO COMPLY WITH THE AGGREGATE LIMIT. If after
making the adjustments required by subparagraphs (1) and (2)
of this paragraph for a Plan Year the Retirement Plan
Administrative Committee determines that the sum of the
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average deferral percentage and the average contribution
percentage for the group consisting of Participants who are
highly compensated Employees exceeds the aggregate limit for
such Plan Year, the Retirement Plan Administrative Committee
shall no later than the last day of the subsequent Plan Year
reduce (i) first the After-Tax Contributions made for such
Plan Year on behalf of each Participant who is a highly
compensated Employee and any corresponding Matching
Contributions and (ii) second, the Pre-Tax Contributions made
for such Plan Year on behalf of each Participant who is a
highly compensated Employee and any corresponding Matching
Contributions to the extent necessary to eliminate such
excess. Such reduction shall be effected in the same manner
described in subparagraphs (1) and (2), as applicable, of this
Section 4.3(e).
(4) DISCOUNT ON SHARES OF COMMON STOCK TREATED AS MATCHING
CONTRIBUTION. Solely for purposes of this Section 4.3, if
shares of common stock of the Corporation are contributed to
the Plan at a discount from fair market value as a Pre-Tax
Contribution, then the amount of such discount shall be
treated as a Matching Pre-Tax Contribution.
4.4 LIMITATIONS ON ANNUAL ADDITIONS.
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(a) THE DEFINED CONTRIBUTION LIMIT. The "annual addition," as defined
herein, for any Plan Year to a Participant's accounts in all defined
contribution plans maintained by each Participating Company or Related Company
shall not exceed the lesser of (1) 25 percent of the Participant's Compensation
for the Plan Year, and (2) $30,000 (as adjusted in accordance with section
415(d) of the Code). The term "annual additions" means the sum of all
contributions and forfeitures allocated to a Participant's accounts (other than
a rollover account).
(b) THE COMBINED LIMIT. For Plan Years beginning prior to December 31,
1999, if the Participant also has participated in a defined benefit plan
maintained by a Participating Company or Related Company, then the limitations
of section 415(e) of the Code shall apply. If such limitations are exceeded,
then the benefits under any defined benefit plan maintained by the Participating
Company or Related Company shall be reduced before the annual additions to the
Plan are reduced.
(c) REDUCTION OF CONTRIBUTIONS. If the Retirement Plan Administrative
Committee determines at any time that the annual addition to any Participant's
Accounts exceeds such limitation for any Plan Year, then the contributions on
behalf of the Participant shall be reduced, to the extent necessary, in the
following order:
(1) Pre-Tax Contributions in excess of six percent of the Participant's
Compensation;
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(2) Remaining Pre-Tax Contributions and Matching Pre-Tax Contributions
attributable thereto on a pro rata basis;
(3) Profit-Sharing Contributions;
(4) After-Tax Contributions in excess of six percent of the Participant's
Compensation;
(5) Remaining After-Tax Contributions and Matching After-Tax Contributions
attributable thereto on a pro rata basis.
After-Tax Contributions, Pre-Tax Contributions and Profit-Sharing
Contributions, each as adjusted for gains, shall be returned to the Participant
(or in the case of an eligible Participant who has filed an election as
described in clause (ii) of section 3.3(b), such Pre-Tax Contributions and
Profit-Sharing Contributions shall be transferred to the SERP). Matching
Contributions, as adjusted for gains, to the extent allowable shall be held in a
suspense account and allocated to the accounts of such Participant in the next
Plan Year; provided that if the Participant is not covered by the Plan in the
next Plan Year, the amount shall be allocated to the remaining Participants in
the Plan who are employed by the Employment Unit that employed the Participant.
(d) LIMITS ON LIMITS. The limits stated on this Article IV shall apply only
to the extent required under the Code. Except as otherwise specifically provided
in this section 4.6, all of the requirements of section 415 of the Code, and
limitations thereon, including the transitional rules and grandfather rules, are
incorporated herein by reference.
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ARTICLE V
VESTING AND FORFEITURES
5.1 IN GENERAL. A Participant shall have a fully vested interest at all
times in his Pre-Tax Account, After-Tax Account, Harris Stock Pre-Tax Account,
Harris Stock After-Tax Account and Savings Account (other than the portion of
such accounts attributable to matching contributions made after October 1, 1984)
and Rollover Account.
5.2 VESTING ON RETIREMENT, DEATH OR DISABILITY. A Participant shall have a
fully vested interest in his Profit Sharing Account, Matching Pre-Tax Account,
Matching After-Tax Account, Harris Stock Matching Account, and portion of his
Savings Account attributable to matching contributions made after October 1,
1984, on termination of his employment by any Related Company in the event of
the Participant's:
(a) retirement on or after Early Retirement Age;
(b) retirement on or after the effective date of the Participant's
Disability; or
(c) death.
5.3 VESTING ON OTHER TERMINATION OF EMPLOYMENT.
(a) VESTING SCHEDULE. A Participant who terminates employment other than on
the occurrence of one of the events described in section 5.2 shall have a vested
interest in his Profit-Sharing Account, Matching Pre-Tax Account, Matching
After-Tax Account, Harris Stock Matching Account and the
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portion of his Savings Account attributable to matching contributions made after
October 1, 1984 in accordance with the following schedule:
Period of Service Vested Percentage
----------------- -----------------
Less than 3 years 0%
3 years but less than 4 years 30%
4 years but less than 5 years 40%
5 years but less than 6 years 60%
6 years but less than 7 years 80%
7 years or more 100%
(b) COMPUTING A PARTICIPANT' S PERIOD OF SERVICE. All Periods of Service
shall be taken into account for purposes of subsection (a). In addition, (i) in
the case of a Participant whose employment is terminated by a Related Company or
Participating Company in connection with a reduction-in-force program, the
period of time that begins on the Participant's employment termination date and
ends 12 months thereafter shall be taken into account for purposes of subsection
(a) and (ii) any prior Period of Service or Period of Severance shall be taken
into account in determining a Participant's Period of Service for purposes of
subsection (a) as provided in section 2.3(a) and 2.3 (b).
(c) VESTING ON SALE OF BUSINESS. In the event of the sale or disposition of
a business or a sale of substantially all of the assets of a trade or business,
the Corporation may, in its discretion, provide for accelerated vesting with
respect to those Participants affected by the sale.
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5.4 EFFECT OF IN-SERVICE WITHDRAWALS ON A PARTICIPANT'S VESTED PERCENTAGE.
If a Participant receives a withdrawal under Article IX or a distribution under
Article VII from his Profit-Sharing Account at a time when the Participant has
less than a fully vested interest in that account, the dollar amount of his
vested interest in his Profit-Sharing Account (X) shall be determined at any
subsequent time by the following formula:
X= P(AB + D) - D
For the purpose of applying the formula, P is the percentage of the
Participant's interest in his Profit-Sharing Account that is vested at the time
the determination is made, AB is the balance credited to the Profit-Sharing
Account at the time the determination is made, and D is the amount of the
withdrawal.
5.5 FORFEITURES.
(a) TIMING OF FORFEITURE. A Participant who terminates employment with less
than a fully vested interest in his Accounts shall forfeit the nonvested
interest on the earliest of:
(1) the date on which the Participant receives a lump sum distribution of
all or a portion of the vested interest in such Accounts, provided
that such distribution is made no later than the close of the second
Plan Year following the year in which the Participant terminates
employment;
(2) the date on which the Participant incurs five consecutive one-year
Periods of Severance; and
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(3) the earliest date allowable under the Code.
(b) EFFECT OF PARTIAL DISTRIBUTION ON A PARTICIPANT'S VESTED PERCENTAGE. If
the Participant elects to receive a lump sum distribution of less than the full
amount of his vested interest, the part of his nonvested interest that shall be
forfeited under subsection (a)(1) is the total nonvested interest multiplied by
a fraction, the numerator of which is the amount of the distribution and the
denominator of which is the total value of his vested interest in his Accounts
other than his After-Tax Account, Harris Stock After-Tax Account and Rollover
Account.
(c) EFFECT OF REEMPLOYMENT ON FORFEITURE. If a Participant incurs a
forfeiture under subsection (a)(1) and subsequently returns to employment with a
Participating Company and becomes a Participant in the Plan before incurring
five consecutive one-year Periods of Severance, then the forfeited amount shall
be restored by the Employment Unit of the Participating Company with which the
Participant is reemployed.
ARTICLE VI
ACCOUNTS AND INVESTMENTS
6.1 ESTABLISHMENT OF ACCOUNTS. The Retirement Plan Administrative Committee
shall establish and maintain for each Participant the following Accounts showing
the Participant's interest under the Plan:
(a) Profit-Sharing Account, which shall consist of
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(1) a Basic Account to reflect the portion of Profit-Sharing Contributions
allocable to the Participant's Compensation, and
(2) a Supplemental Account to reflect the portion of Profit-Sharing
Contributions allocable to the Participant's Excess Compensation;
(b) Pre-Tax Account to reflect Pre-Tax Contributions made on the
Participant's behalf other than those invested in the Harris Stock Fund;
(c) After-Tax Account to reflect After-Tax Contributions made on the
Participant's behalf other than those invested in the Harris Stock Fund;
(d) Matching Pre-Tax Account to reflect Matching Pre-Tax Contributions made
on the Participant's behalf other than those invested in the Harris Stock Fund;
(e) Matching After-Tax Account to reflect Matching After-Tax Contributions
made on the Participant's behalf other than those invested in the Harris Stock
Fund;
(f) Savings Account to reflect the Savings Contributions under the Plan as
in effect prior to July 1, 1990, and the aggregate of the Participant's
voluntary and required contributions to the Harris Video Systems
Savings/Incentive Plan less withdrawals, as of June 30, 1990;
(g) Harris Stock Pre-Tax Account to reflect the portion of the Pre-Tax
Contributions made on the Participant's behalf invested in the Harris Stock
Fund;
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(h) Harris Stock After-Tax Account to reflect the portion of the After-Tax
Contributions made on the Participant's behalf invested in the Harris Stock
Fund;
(i) Harris Stock Matching Account to reflect the portion of the Matching
Pre-Tax Contributions and Matching After-Tax Contributions made on the
Participant's behalf and invested in the Harris Stock Fund; and
(j) Rollover Account to reflect the Participant's Rollover Contributions.
6.2 INVESTMENT OF ACCOUNTS. Subject to section 6.4, each Participant shall
have the right to direct the investment of his Accounts and future contributions
to his Accounts among the Investment Funds in accordance with the following
procedures and such other procedures provided in the documents pertaining to
each Investment Fund.
(a) ELECTION PROCEDURES. Each election shall be made in accordance with the
rules and procedures established by the Retirement Plan Administrative Committee
in its absolute discretion.
(b) ELECTIONS IN 1% INCREMENTS FOR CURRENT BALANCES. A Participant's
election with respect to his current Account balances shall be made in
increments of one percent (or such larger percentage as determined by the
Retirement Plan Administrative Committee) of the Account balances;
(c) ELECTIONS IN 1% INCREMENTS FOR FUTURE CONTRIBUTIONS. A Participant's
election with respect to future contributions shall be made in increments of one
percent (or such larger percentage as determined by the
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Retirement Plan Administrative Committee) of the contribution (after the
contribution is reduced by any dollar amount directed into the Harris Stock
Fund), provided that the combined Pre-Tax Contributions and After-Tax
Contributions invested in the Harris Stock Fund shall equal no more than one
percent (or such larger percentage as determined by the Retirement Plan
Administrative Committee) of Compensation as provided under section 6.4(a). To
the extent Pre-Tax Contributions and After-Tax Contributions are invested in the
Harris Stock Fund, the Matching Contributions attributable thereto also shall be
invested in the Harris Stock Fund;
(d) CHANGING ELECTIONS. Effective January 1, 1998, a Participant may change
an investment election at any time. An investment election change shall be
effective on the day the change is made, provide that such day is a Valuation
Date and that the Participant makes the election change before the deadline
established from time to time by the Retirement Plan Administrative Committee.
An investment election change (i) made on a day that is not a Valuation Date or
(ii) made on a Valuation Date after the deadline established by the Retirement
Plan Administrative Committee shall become effective on the next following
Valuation Date. If more than one election change is made on a Valuation Date
before the applicable deadline, the most recent election change shall be given
effect.
(e) ELECTIONS APPLY TO ALL ACCOUNTS. Each of the Participant's Accounts
shall be invested among the Investment Funds in the same manner,
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such that each election by a Participant with respect to the Investment Funds
shall apply to all of his Accounts in the same proportion.
(f) INVESTMENT IN BALANCED FUND ABSENT ELECTION. A Participant's Accounts
and contributions made on behalf of the Participant shall be invested in the
Balanced Fund until the Participant makes a valid investment election pursuant
to this section 6.2 and any other procedures established by the Retirement Plan
Administrative Committee.
6.3 ALLOCATION OF EARNINGS AND LOSSES. In determining a Participant's share
of the earnings or losses of each of the Investment Funds as of any Valuation
Date, the total earnings or losses of the particular Investment Fund since the
immediately preceding Valuation Date, net of expenses allocable to such fund,
shall be allocated among the Participants' Accounts invested in the fund on such
Valuation Date based on the ratio of each Participant's Accounts to the
aggregate of the Accounts of all Participants, before taking into account any
contributions that are required to be but are not yet made as of the Valuation
Date and before taking into account any distributions, withdrawals or loans to
Participants made as of the Valuation Date. Contributions to an Account are not
credited with earnings for the Valuation Date on which the contributions are
credited to the Account.
6.4 SPECIAL RULES CONCERNING HARRIS STOCK FUND. Notwithstanding any
provision of section 6.2 to the contrary, the rules set forth in this section
shall apply to investments in the Harris Stock Fund.
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(a) AVAILABILITY. Only Pre-Tax Contributions, After-Tax Contributions and
Matching Contributions made with respect to Compensation earned on or after
October 1, 1993 may be invested in the Harris Stock Fund. For any Plan Year, the
combined Pre-Tax Contributions and After-Tax Contributions invested in the Fund
on behalf of a Participant in each Plan Year shall equal no more than one
percent (or such larger percentage as determined by the Retirement Plan
Administrative Committee) of the Participant's Compensation for such Plan Year.
The portion of any Pre-Tax Contribution or After-Tax Contribution that is
attributable to a discount from fair market value on shares of common stock of
the Corporation shall be disregarded for purposes of the immediately preceding
sentence. An election to invest in the Harris Stock Fund shall take effect as
soon as administratively feasible after the election is received.
(b) RESTRICTIONS ON TRANSFERS. A Participant may not transfer amounts from
other Investment Funds to the Harris Stock Fund. Any contributions invested in
the Harris Stock Fund must remain in the fund for a minimum of 36 months,
provided that amounts invested in the Harris Stock Fund may be distributed to
the Participant before the expiration of the 36-month period, if the Participant
is otherwise entitled to a distribution under the Plan. The Retirement Plan
Administrative Committee, in its sole discretion, may impose additional
restrictions or requirements regarding transfers from the Harris Stock Fund.
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(c) DIVIDENDS. A Participant's allocable share of cash dividends (and other
cash earnings) credited to the Harris Stock Fund will be reinvested in the
Harris Stock Fund unless the Participant elects with respect to the dividends
credited to his Account during a calendar quarter to invest such cash dividends
(and other cash earnings) among the Investment Funds other than the Harris Stock
Fund in increments of one percent (or such larger percentage as determined by
the Retirement Plan Administrative Committee) of the amount of the dividends
(and other earnings). Each election shall be completed at such time and in
accordance with rules and procedures as established by the Retirement Plan
Administrative Committee, pursuant to section 6.2. Dividends paid in the form of
stock shall be retained in a Participant's Account until liquidated, in the sole
discretion of the Retirement Plan Administrative Committee. Such liquidated
dividends shall be considered cash earnings subject to investment elections in
accordance with this section 6.4(c).
(d) CONTRIBUTIONS. The normal form of contributions for amounts invested in
the Harris Stock Fund shall be in cash; provided, however, that the Corporation,
in its discretion, may make the contribution in common stock of the Corporation,
which may be contributed at a discount from fair market value. The Trustee is
authorized to purchase common stock of the Corporation on the open market, and
to give effect to the discount, if any, established from time to time by
allocating shares to each Participant's
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Account in addition to the number of shares that would have been allocated to
the Participant's Account if the discount had not been established.
(e) DISTRIBUTIONS. Distributions from the Harris Stock Fund shall be in the
form of cash or shares of Harris Stock at the election of the Participant.
Fractional shares and distributions of a de minimis amount as determined by the
Retirement Plan Administrative Committee shall be paid in cash.
(f) VOTING. Participants may submit non-binding proxies to the Trustee,
which will vote the shares in the Harris Stock Fund in the exercise of its sole
discretion.
ARTICLE VII
DISTRIBUTIONS
7.1 IN GENERAL. A Participant shall be entitled to receive a distribution
of the vested interest in his Accounts on the earlier of the Participant's (i)
termination of employment and (ii) attainment of age 59 1/2, except that his
Pre-Tax Contributions and Matching Pre-Tax Contributions are distributable only
as allowed under section 401(k) of the Code. As permitted under law and as may
he determined by the Retirement Plan Administrative Committee in its sole
discretion, distributions may be made to affected Participants upon the sale or
disposition of the stock in a subsidiary or the sale or disposition of assets of
a trade or business. A termination of employment shall not be deemed to occur
for purposes of this section 7.1 and section 7.2 until the Participant is no
longer employed by a Related Company. A Participant may
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elect, in accordance with procedures established by the Retirement Plan
Administrative Committee, to receive the sum of the balances of his Accounts, if
any, that are invested in the Harris Stock Fund either in (a) cash, or (b) in
shares of common stock of the Corporation; provided, however, that distributions
of fractional shares and de minimis amounts (as determined by the Retirement
Plan Administrative Committee) shall be made in cash. If a Participant has
elected to receive a distribution of the balances of his Accounts that are
invested in the Harris Stock Fund in shares of common stock of the Corporation,
then such distribution shall, in the discretion of the Retirement Plan
Administrative Committee, either be made in certificated form or credited to an
account established for the Participant under a plan maintained by a Related
Company.
7.2 SMALL BENEFIT CASH-OUT. Except as provided in section 7.5, in any case
in which the vested interest in a Participant's Accounts does not exceed $5,000
(or such larger amount as may be permitted by law) the vested interest shall be
paid to the Participant in a lump sum as soon as reasonably practicable after
the Participant's termination of employment. In the case of a deceased
Participant, such vested interest shall be paid, to the deceased Participant's
beneficiary in a lump sum as soon as reasonably practicable after the
Participant's death, except that if such Beneficiary is the deceased
Participant's spouse, then the Beneficiary may elect a direct rollover in
accordance with section 7.5. Effective as of March 22, 1999, for purposes of
this section 7.2 and section 12.5, if at the time of commencement of the
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distribution of a Participant's vested interest in his Accounts in scheduled
periodic payments the value of such interest exceeded $5,000, then at the time
of any subsequently scheduled periodic payment such account balance will be
deemed to exceed $5,000 (or such larger amount as may be permitted by law)
unless otherwise permitted under the law.
7.3 FORM OF PAYMENT.
(a) OPTIONS. In any case in which a Participant's vested interest in his
Accounts exceeds the amount provided in section 7.2, the Participant (or in the
event of death, his Beneficiary) entitled to receive a distribution may elect at
any time to receive payment in:
(1) an amount not greater than the vested balance of the Participant's
Accounts, provided, however, that only one such payment may be made in
any single month;
(2) substantially equal periodic installment payments, payable not less
frequently than annually and not more frequently than monthly, over a
period of time to be elected by the Participant (or Beneficiary);
(3) a combination of (1) and (2); or
(4) a direct rollover pursuant to section 7.5.
(b) CHANGES ALLOWED. A Participant (or, in the event of death, his
Beneficiary) may change his election with respect to the form of payment at any
time before or after distribution of benefits commences, subject to the
provisions of section 7.9.
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(c) EFFECT OF FAILURE TO SPECIFY AN OPTION. If a Participant (or
Beneficiary) fails to file an election under this section 7.3, then his benefits
shall be paid in accordance with section 7.4.
7.4 TIME OF PAYMENT.
(a) On termination of employment, a Participant, other than one described
in section 7.2, may elect that payment of benefits begins as soon as
administratively practicable or at any other time permitted under the Plan. If
such a Participant fails to file an election as to the timing of his benefit
payment, then payment of his benefit shall commence in accordance with the
provisions of section 7.8.
(b) If a Participant dies before his required beginning date (as described
in section 7.8(b)) and there is no election in effect with respect to the
payment of the Participant's benefits to his Beneficiary who is not his spouse,
then payment of the Participant's benefits shall be made in a single sum no
later than the December 31 of the calendar year which contains fifth anniversary
Participant's death.
(c) Installment payments described in section 7.3(2) or (3) shall not be
made to a Participant who terminated employment with an Employer and who
subsequently becomes employed by a Participating Company. Installment payments
to such a Participant shall commence or recommence upon the Participant's
subsequent termination of employment with the Participating Company.
7.5 DIRECT ROLLOVER.
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(a) A Participant or "distributee" may elect at any time to have any
portion of an "eligible rollover distribution" paid in a direct rollover to the
trustee or custodian of an "eligible retirement plan" specified by the
Participant or distributee, whichever is applicable. Payment of a direct
rollover in the form of a check payable to the trustee or custodian of an
eligible retirement plan, for the benefit of the Participant or distributee, may
be mailed to the Participant or distributee.
(b) For purposes of this section 7.5, the following terms shall have the
following meanings:
(1) "distributee" means a surviving spouse, or a spouse or former spouse
who is an alternate payee under a qualified domestic relations order
defined in section 414(p) of the Code.
(2) "eligible retirement plan" means an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, an annuity plan
described in section 403(a) of the Code, or a qualified trust
described in section 401(a) of the Code that accepts an eligible
rollover distribution.
(3) "eligible rollover distribution" means any distribution of all or a
portion of the Participant's Accounts, other than the portion of his
After-Tax Account and Harris Stock After-Tax Account attributable to
After-Tax Contributions, but does
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not include a distribution (i) in installments over a period of ten
years or more or over a period described in section 7.8(c), or (ii) to
the extent the distribution is required under section 401(a)(9) of the
Code.
7.6 BENEFIT AMOUNT AND WITHHOLDING.
(a) VESTED AMOUNT AND ADJUSTMENTS. For purposes of this Article VII, a
Participant's vested interest in his Accounts shall be determined as of the
Valuation Date coinciding with or immediately following the date of the event
giving rise to the distribution, plus any Profit-Sharing Contribution to which
the Participant may be entitled under section 3.2 that has not yet been credited
to the Participant's Profit-Sharing Account. Any unpaid amount in the
Participant's Accounts shall continue to be adjusted for earnings and losses as
provided in section 6.3 until it is distributed.
(b) WITHHOLDING. The amount of any distribution shall be reduced to the
extent necessary to comply with Federal, state and local income tax withholding
requirements.
7.7 ORDER OF DISTRIBUTIONS. Any distribution under this Plan shall be
charged against the Participant's Accounts pursuant to administrative procedures
designed to maximize the tax benefits to the Participant by distributing to him
first his After-Tax Contributions to the extent permitted by law.
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7.8 STATUTORY REQUIREMENTS. Notwithstanding any other provisions of the
Plan to the contrary, the following rules shall apply to all payments under the
Plan:
(a) LATEST COMMENCEMENT DATE. Unless the Participant files a written
election to defer payment of benefits, benefits payments with respect to any
Participant shall commence no later than the 60th day after the close of the
Plan Year in which the latest of the following occurs:
(1) the date on which the Participant attains Normal Retirement Age;
(2) the 10th anniversary of the date on which the Participant commenced
participation in the Plan; and
(3) the date on which the Participant terminated employment. Failure to
file an election under section 7.4 for payment of benefits to commence
shall be deemed to be a written election to defer payment of benefits
under this subsection (a).
(b) REQUIRED BEGINNING DATE. Notwithstanding subsection (a) above, payment
of benefits to a Participant shall commence no later than April 1 of the
calendar year following the calendar year in which the Participant attains age
70 1/2.
(c) MAXIMUM DURATION OF DISTRIBUTIONS. Payment of a Participant's benefit
shall be made over a period not to exceed one of the following periods:
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(1) the life of the Participant;
(2) the life of the Participant and the Participant's Beneficiary;
(3) a period certain not extending beyond the life expectancy of the
Participant; or
(4) a period certain not extending beyond the joint and last survivor
expectancy of the Participant and his Beneficiary.
The amount to be distributed each year must be at least equal to the
quotient obtained by dividing the Participant's benefit by the life expectancy
of the Participant or the joint and last survivor expectancy of the Participant
and his Beneficiary. Life expectancy and joint and last survivor expectancy
shall be computed by the use of the return multiples contained in Treasury
Regulation section 1.72-9. Effective January 1, 1998, the life expectancy of a
the Participant who commenced payment of benefits pursuant to this section prior
to such date and the life expectancy of such a Participant's spouse will be
recalculated annually for purposes of the computation described in this
subsection (c) only if the Participant affirmatively so elects; however, the
life expectancy of any other Participant, spouse or Beneficiary will not be
recalculated. If the Participant's spouse is not the Beneficiary, the method of
distribution selected must ensure that at least 50 percent of the present value
of the amount available for distribution is paid within the life expectancy of
the Participant.
(d) DISTRIBUTION AFTER THE PARTICIPANT'S DEATH. In the event a Participant who
is receiving benefits dies, the remaining balance of his benefits
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shall be distributed at least as rapidly as under the method of distribution
elected by the Participant unless otherwise permitted under law. If a
Participant dies before distribution of benefits commences, the Participant's
entire interest will be distributed no later than five years after the end of
the year of the Participant's death, except to the extent that an election is
made to receive distributions in accordance with (1) or (2) below:
(1) if any portion of the Participant's benefit is payable to a
Beneficiary who is not the Participant's spouse, then distributions
may be made over the life or life expectancy of the Beneficiary,
provided that distributions commence on or before December 31 of the
calendar year immediately following the calendar year in which the
Participant died, and
(2) if the beneficiary is the Participant's spouse, then distributions may
commence on or before the later of (i) December 31 of the calendar
year immediately following the calendar year in which the Participant
died and (ii) December 31 of the calendar year in which the
Participant would have attained age 70 1/2. If the Participant's
spousE dies before payments begin, then subsequent distribution shall
be made as if the spouse had been the Participant.
For purposes of the foregoing, payments may be calculated by use of the
return multiples specified in Treasury Regulation section 1.72-9. The life
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expectancy of a spouse or other Beneficiary shall be calculated at the time
payment first commences without subsequent recalculation. Any amount paid to a
child of the Participant shall be treated as if it had been paid to the
surviving spouse if the amount becomes payable to the spouse when the child
reaches the age of majority.
(e) LIMIT ON LIMITS. All distributions under this section 7.8 shall be
determined and made in accordance with section 401(a)(9) of the Code, including
the minimum distribution incidental benefit requirement of proposed Treasury
Regulation section 1.401(a)(9)-2, the provisions of which are incorporated
herein by reference.
7.9 DESIGNATING BENEFICIARIES.
(a) WRITTEN DESIGNATION. Each Participant may designate, in the manner
prescribed by the Retirement Plan Administrative Committee, a Beneficiary or
Beneficiaries to receive any benefits payable as a result of the death of the
Participant. This designation may be changed by the Participant at any time by
giving notice to the Retirement Plan Administrative Committee in accordance with
rules and procedures established by the Retirement Plan Administrative
Committee. Any designation of a Beneficiary other than the Participant's spouse
must be consented to by the spouse in writing (or other method permitted by the
Internal Revenue Service) and witnessed by a notary public (or a representative
of the Plan prior to October 1, 1993). Any consent required under this section
7.9 shall be valid only with respect to the spouse who signed it. Spousal
consent shall not be required if the Participant
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establishes to the satisfaction of a Plan representative that such consent may
not be obtained because (a) there is no spouse; (b) the spouse cannot be
located, or (c) there exists such other circumstances as the Secretary of the
Treasury may prescribe as excusing the requirement for such consent. A
Participant may revoke any prior election without obtaining the consent of the
spouse to such revocation. In the absence of a new election that meets the
requirements of this section 7.9, the Participant's surviving spouse shall be
the Beneficiary.
(b) DEATH PRIOR TO DESIGNATING BENEFICIARY OR DEATH AFTER DESIGNATED
BENEFICIARY'S DEATH. In the event a Participant dies with no beneficiary
designation on file or after the death of a designated Beneficiary, the
Participant's Beneficiary with respect to the portion of the benefits for which
no Beneficiary has been designated shall be the deceased Participant's surviving
spouse, if any, and if there is no surviving spouse, the descendants of the
deceased Participant, if any, per stirpes, or if there are no descendants, the
estate of the deceased Participant.
(c) SUCCESSOR BENEFICIARIES. A Beneficiary who has been designated in
accordance with section 7.9(a) may name a successor beneficiary or beneficiaries
in accordance with procedures established by the Retirement Plan Administrative
Committee. If the designated Beneficiary dies after the Participant and before
the entire amount of the Participant's benefit under the Plan in which the
designated Beneficiary has an interest has been distributed, then any remaining
amount shall be distributed, as soon as practicable after
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the death of such designated Beneficiary, in the form of a single sum payment to
the successor beneficiary or if there is no such successor beneficiary, to the
Beneficiary's estate.
7.10 PAYMENT OF GROUP INSURANCE PREMIUMS. If a retired Participant is
eligible to be included in any contributory group insurance program maintained
or sponsored by an Employment Unit, a retired Participant who is receiving
benefits under the Plan in installments and who elects to be covered under such
contributory group insurance program may direct that a specified portion of the
installment payments be withheld and paid by the Trustee on his behalf to the
Employment Unit as his contribution under such group insurance program. Such
direction by a retired Participant shall be in writing on a form prescribed by
the Retirement Plan Administrative Committee. Any such direction may be revoked
by the retired Participant not less than 15 days prior to the effective date of
such revocation. Any withholding and payment of insurance costs on behalf of a
retired Participant shall be made in accordance with Treasury Regulation section
1.401(a)-13.
7.11 INABILITY TO LOCATE PARTICIPANT. If, at any time after a Participant's
benefit becomes payable, a check or other instrument in payment of such benefit
is returned unclaimed or the Retirement Plan Administrative Committee is
otherwise unable to locate the individual to whom a payment is due, then all
payments to such individual shall be discontinued. If, after exercising
reasonable diligence, the Retirement Plan Administrative Committee is unable to
locate such individual, the portion of the Participant's benefit payable to
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such individual shall be forfeited and applied to reduce the administrative
expenses of the Plan; provided, that if such individual subsequently makes a
claim for benefits, then the forfeited amount shall be reinstated to the extent
required by law by the Participating Company that last employed the Participant.
ARTICLE VIII
LOANS
8.1 IN GENERAL. Each "party in interest," as defined in section 3(14) of
ERISA, with respect to the Plan for whom a Pre-Tax Account, After-Tax Account
and/or Rollover Account is maintained may request that a loan be made to him
from his Pre-Tax Account, After-Tax Account and/or Rollover Account by filing an
appropriate application, pursuant to procedures adopted by the Retirement Plan
Administrative Committee. All loan requests shall be approved on a reasonably
equivalent basis (within the meaning of section 4975(d)(1)(A) of the Code and
section 408(b)(1)(A) of ERISA), subject to the conditions set forth in this
Article VIII.
8.2 LOAN ADMINISTRATION. The Retirement Plan Administrative Committee shall
be responsible for administering the loan program, but may delegate the
operation of the program to the Plan's record-keeper. The procedures for
applying for a loan and the basis on which loans will be approved or denied
shall be described in the summary plan description for the Plan or in other
documents prepared by or at the direction of the Corporation
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for this purpose and such additional documents are hereby incorporated by
reference to the extent required by the Department of Labor.
8.3 TERMS AND CONDITIONS OF LOANS. The terms and conditions of each loan
shall be set forth in the agreement evidencing the loan and shall include, but
not be limited to, the following:
(a) MAXIMUM AMOUNT. The principal amount of a loan made under this Plan to
any individual together with the outstanding principal amount of any other loan
made to such individual under any other qualified plan under section 401(a) of
the Code maintained by a Related Company shall not exceed the least of
(1) 50 percent of the individual's vested interest in his Accounts,
(2) $50,000 reduced by the highest outstanding balance of any previous
loans from the Plan and any other plans of a Related Company during
the one-year period ending immediately before the date on which the
current loan is made, and
(3) such amount that repayment of principal plus interest does not exceed
25 percent of the individual's gross pay.
(b) MINIMUM AMOUNT. The minimum loan amount shall be $500 and all loan
amounts shall be in increments of $100.
(c) PERIOD. No loan shall be made for a period less than 12 months or
longer than four and one-half years or such other periods as may be
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established from time to time under the Retirement Plan Administrative
Committee's written loan procedures.
(d) SECURITY. A loan shall be secured by the Participant's Accounts up to
the amount of the outstanding balance of the loan.
(e) NUMBER OF LOANS. Two loans shall be available under the Plan to a
Participant at any time, but no third loan shall be made to an individual within
30 days following the repayment in full of a prior loan, or such other time
period as may be provided from time to time under Plan procedures.
(f) PARTICIPANT COVERS LOAN EXPENSE. Any loan made under the Plan shall be
subject to such other terms and conditions as the Retirement Plan Administrative
Committee shall deem necessary or appropriate, including the condition that the
individual applying for the loan reimburse the Plan for any state documentary
stamps and other taxes, and any other reasonable expenses specified by the
Retirement Plan Administrative Committee, which the Plan incurs to extend, make
and service the loan.
(g) HOW TO APPLY. A loan may be initiated by following the appropriate
telephonic or other procedures established by the record-keeper, as the delegate
of the Retirement Plan Administrative Committee.
8.4 INTEREST RATE. The interest rate for a loan made under this Plan shall
be fixed for the term of each loan, and shall be set as determined by the
Retirement Plan Administrative Committee on a quarterly basis at a rate which
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it deems reasonable at the time for a fully secured loan and which is consistent
with applicable Department of Labor regulations.
8.5 REPAYMENT AND DEFAULT.
(a) PAYMENTS. A loan made under the Plan shall require that repayment be
made in substantially level installments through payroll withholding while the
individual is an Employee and through such other means (not less frequently than
quarterly) as the Retirement Plan Administrative Committee deems appropriate for
an individual who is not an Employee. Nevertheless, any individual who
terminates employment for any reason other than retirement, discharge or Layoff
must repay all of the outstanding principal balance of his loan, plus interest
due, within 90 days of the date of termination.
(b) PREPAYMENT. An individual may repay, at any time, all of the
outstanding principal balance of his loan, plus interest due, without penalty.
(c) CREDITING PAYMENT. Principal and interest payments shall be credited to
the Participant's Pre-Tax Account, After-Tax Account and/or Rollover Account and
shall be invested in the same manner as Pre-Tax Contributions, After-Tax
Contributions and Rollover Contributions.
(d) DEFAULT. The events of default shall be set forth in the agreement
evidencing the loan. Such events shall include, but not be limited to, the
following:
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(1) an individual terminates employment as an Employee for any reason and
does not make payments when due, subject to a 90-day grace period;
(2) the Trustee concludes that the individual no longer is a good credit
risk;
(3) to the extent permissible under federal law, the individual's
obligation to repay the loan has been discharged through bankruptcy or
any other legal process of action which did not actually result in
payment in full; and
(4) the individual does not make payments when due, subject to the
applicable 90 day grace period.
(e) EFFECT OF DEFAULT. Upon the existence or occurrence of an event of
default, the loan may become due and payable in full and, if such loan is not
actually repaid in full, shall be canceled on the books and records of the Plan
and the amount otherwise distributable to such individual shall be reduced, as
of the date his Accounts otherwise become distributable, by the principal amount
of the loan then due plus any accrued but unpaid interest. Such principal and
interest shall be determined without regard to whether the loan had been
discharged through bankruptcy or any other legal process or action which did not
actually result in payment in full; however, interest shall continue to accrue
on such loan only to the extent permitted under applicable law. Cancellation of
the amount distributable to an individual under this subsection (e) shall not
occur until a distributable event occurs under the Plan.
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In the event a default occurs before a distributable event occurs, the
Retirement Plan Administrative Committee shall take such other steps to cure the
default as it deems appropriate under the circumstances to preserve Plan assets.
8.6 MECHANICS. A loan to an individual under this Plan shall be made from
his Pre-Tax Account, After-Tax Account and Rollover Account, and the loan shall
be an asset of the respective accounts. For investment purposes, the principal
amount of the loan shall be deducted from the Participant's Investment Funds
other than the Harris Stock Fund in proportion to their value in his Accounts as
of the Valuation Date immediately preceding the loan.
8.7 SPECIAL POWERS. The Retirement Plan Administrative Committee shall have
the power to take such action as it deems necessary or appropriate to stop the
benefit payments to or on behalf of an individual who fails to repay a loan
(without regard to whether the obligation to repay the loan had been discharged
through bankruptcy or other legal process or action) until his Pre-Tax Account,
After-Tax Account and/or Rollover Account has been reduced by the principal due
(without regard to such discharge) on such loan or to distribute the note which
evidences such loan in full satisfaction of any interest in the Pre-Tax Account,
After-Tax Account, and/or Rollover Account which is attributable to the unpaid
balance of such loan.
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ARTICLE IX
IN-SERVICE WITHDRAWALS
9.1 WITHDRAWALS FROM SAVINGS ACCOUNT AND AFTER-TAX ACCOUNT.
(a) AVAILABILITY. Subject to sections 9.3 and 9.4, a Participant may elect
to withdraw from the Plan at any time in a single sum an amount not greater than
the balances of his Savings Account and After-Tax Account in the time and manner
prescribed by the Retirement Plan Administrative Committee. The amount withdrawn
shall be debited first to his Savings Account and then to his After-Tax Account.
(b) LIMITATIONS. A Participant may make a withdrawal under this section 9.1 no
more than once in any calendar quarter. A Participant's election to make
After-Tax Contributions shall be suspended, and no After-Tax Contributions or
Matching After-Tax Contributions shall be credited to the Participant's Account,
for a period of three months after the date of a Participant's withdrawal from
his After-Tax Account. The Participant's election shall automatically be
reinstated at the expiration of such three-month period, unless the Participant
has filed a change of election pursuant to section 3.7.
9.2 WITHDRAWALS FROM ROLLOVER, PRE-TAX AND PROFIT SHARING ACCOUNTS.
(a) AVAILABILITY. Subject to sections 9.3 and 9.4, a Participant who has
taken all available loans under Article VIII hereof and who has exhausted his
right to withdrawals under section 9.1 may elect, if he has an immediate and
heavy financial need within the meaning of Treasury Regulation section
1.401(k)-1(d)(2)(iv), to withdraw in a single sum an amount not greater
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than (i) 100 percent of his Pre-Tax Contributions, (ii) the entire balance of
his Rollover Account, and (iii) the vested balance of his Profit Sharing
Account, in the time and manner prescribed by the Retirement Plan Administrative
Committee. A Participant shall be deemed to have an immediate and heavy
financial need if the withdrawal is requested for any of the following reasons:
(1) to pay expenses for medical care previously incurred by the
Participant, his spouse or any of his dependents or necessary for
these persons to obtain medical care;
(2) to purchase (excluding mortgage payments) a principal residence for
the Participant;
(3) to pay for tuition and related education fees for the next 12 months
of it post-secondary education for the Participant, his spouse,
children or dependents;
(4) to prevent the eviction of the Participant from his principal
residence or a foreclosure on the mortgage of the Participant's
principal residence; or
(5) the occurrence of any other event determined by the Commissioner of
Internal Revenue pursuant to Treasury Regulation section
1.401(k)-l(d)(2)(iv).
A withdrawal to satisfy an immediate and heavy financial need of the
Participant may be made only if:
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(i) the withdrawal is not in excess of the amount required to meet the
financial need of the Participant, including taxes and additions to tax
applicable to such withdrawal, and
(ii) the Participant has obtained all other distributions,
withdrawals, and all nontaxable loans currently available under the Plan
and any other plans maintained by a Related Company.
The Participant shall be required (i) to certify to the Retirement Plan
Administrative Committee in the manner prescribed by the Retirement Plan
Administrative Committee both the reason for the financial need and that such
need cannot be satisfied from sources other than a withdrawal from the
Participant's Accounts, and (ii) to submit any additional supporting
documentation as may be requested by the Retirement Plan Administrative
Committee.
(b) ORDER OF WITHDRAWALS. Withdrawals under this section 9.2 shall be
withdrawn from a Participant's Accounts in the following order: (i) from the
Participant's Rollover Account, if any; (ii) to the extent that the balance of
the Participant's Rollover Account is not sufficient to satisfy the amount of
the requested withdrawal, from the Participant's Pre-Tax Contributions; and
(iii) to the extent that the Participant's Rollover Account and Pre-Tax
Contributions are not sufficient to satisfy the amount of the requested
withdrawal, from the vested balance of the Participant's Profit Sharing Account.
(c) LIMITATIONS. A Participant may take a withdrawal under this section 9.2
no more than once in any six-month period.
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9.3 CONDITIONS APPLICABLE TO ALL WITHDRAWALS. A Participant shall provide
to the Retirement Plan Administrative Committee written notice of his election
to make any withdrawal permitted under this Article IX at least 30 days (or such
shorter period as may be designated by the Retirement Plan Administrative
Committee) prior to the date as of which such withdrawal is to be effected. The
amount available for withdrawal under this Article IX shall be reduced by the
amount of any outstanding loan balance under Article VIII hereof, and no
withdrawal under this Article IX shall be permitted to the extent that such
withdrawal would cause the aggregate amount of such outstanding loan balance to
exceed the limits described in section 8.2. The amount available for withdrawal
under this Article IX is also subject to reduction in the sole discretion of the
Retirement Plan Administrative Committee to take into account the investment
experience of the Trust Fund between the date of the election and the date of
the withdrawal.
9.4 REDUCTION OF INVESTMENT FUND BALANCES. The Investment Funds in which a
Participant's Accounts are invested, other than the Harris Stock Fund, shall be
reduced proportionately to reflect the amount of the Participant's withdrawals
under this Article IX.
ARTICLE X
TOP-HEAVY PROVISIONS
10.1 IN GENERAL. Notwithstanding any other provisions of the Plan to the
contrary, for any Plan Year in which this Plan is "top-heavy," as defined
herein, the provisions of this Article X shall apply. If the Plan is top-heavy
and
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then ceases to be top-heavy, except as otherwise provided in section 10.3, the
provisions of this Article X shall cease to apply.
10.2 MINIMUM ALLOCATION.
(a) AMOUNT. For any Plan Year for which the Plan is top-heavy, a minimum
allocation shall be made for each "non-key employee" who is employed by a
Participating Company on the last day of the Plan Year in an amount equal to the
lesser of (1) three percent of Compensation or (2) the largest percentage of
Compensation allocated to any "key employee" during the Plan Year. The minimum
allocation shall be determined without regard to any Social Security
contribution, and without regard to any Pre-Tax Contributions made on behalf of
non-key employees. The minimum allocation shall not apply to any non-key
employee who receives a minimum contribution or minimum benefit under any other
plan of a Related Company.
(b) ALLOCATION. To satisfy subsection (a), the Profit-Sharing Contributions
for such Plan Year first shall be allocated to all Participants employed on the
last day of the Plan Year in an amount that meets the minimum allocation amount,
and any remaining Profit-Sharing Contribution then shall be allocated in
accordance with section 3.2.
10.3 MINIMUM VESTING. For any Plan Year for which the Plan is top-heavy,
the vested interest of a Participant who is employed by a Participating Company
during any part of the Plan Year shall be determined under the following
schedule:
PERIOD OF SERVICE VESTED PERCENTAGE
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Less than 2 years 0%
2 years but less than 3 years 20%
3 years but less than 4 years 40%
4 years but less than 5 years 60%
5 years but less than 6 years 80%
6 years or more 100%
If the Plan becomes top-heavy and later ceases to be top-heavy, a
Participant who has a three-year Period of Service as determined under section
5.3 may elect to have his vested interest continue to be determined under this
section 10.3, notwithstanding that the Plan is no longer top-heavy.
10.4 DEFINITIONS. For purposes of this Article X the following terms shall
have the following meanings:
(a) "Determination date" means the last day of the preceding Plan Year.
(b) "Determination period" means the Plan Year containing the determination
date and the four preceding Plan Years.
(c) "Key employee" means an Employee or former employee (and their
Beneficiaries) who, at any time during the determination period, is
(1) an officer of the Participating Company and has annual compensation
greater than 50 percent of the dollar limitation in effect under
section 415(b)(1)(A) of the Code for any such Plan Year,
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(2) one of the ten Employees having annual compensation in excess of the
limitation in effect under section 415(c)(1)(A) of the Code and owning
(or considered as owning with the meaning of section 318 of the Code)
the largest interests in the Participating Company,
(3) a five-percent owner (within the meaning of section 416(i)(1)(B) of
the Code) of the Participating Company, or
(4) a one-percent owner of the Participating Company having annual
compensation from the Participating Company of more than $150,000.
The determination of "key employee" shall be made under section 416(i)(1)
of the Code, the terms of which are incorporated herein by reference.
(d) "Non-key employee" means any Employee who is not a key employee.
(e) "Permissive aggregation group" means the "required aggregation group"
and any other plans of the Participating Company which, when considered as a
group with the required aggregation group, would continue to satisfy the
requirements of sections 401(a)(4) and 410 of the Code.
(f) "Required aggregation group" means (1) each qualified plan of the
Participating Company in which at least one key employee participates or
participated at any time during the determination period (regardless of whether
the plan has terminated), and (2) any other qualified plan of the Participating
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Company which enables a plan described in (1) to meet the requirements of
sections 401(a) and 410 of the Code.
(g) "Top-heavy" means:
(1) the top-heavy ratio for the Plan exceeds 60 percent and the Plan is
not part of any required aggregation group or permissive aggregation
group;
(2) the Plan is part of a required aggregation group but not a permissive
aggregation group and the top-heavy ratio for the required aggregation
group exceeds 60 percent;
(3) the Plan is part of a required aggregation group and a permissive
aggregation group and the top-heavy ratio for the permissive
aggregation group exceeds 60 percent.
(h) "Top-heavy ratio" means:
(1) if the Participating Company or Related Company has not maintained any
defined benefit plan which during the five-year period ending on the
determination date had accrued benefits, the top-heavy ratio is a
fraction, the numerator of which is the sum of the account balances of
all key employees as of the determination date (including any part of
any account balance distributed in the five-year period ending on the
determination date), and the denominator of which is the sum of all
account balances (including any part
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of any account balance distributed in the five-year period ending on
the determination date).
(2) If a Related Company maintains or has maintained a defined benefit
plan which during the five-year period ending on the determination
date had accrued benefits, the top-heavy ratio is a fraction, the
numerator of which is the sum of account balances under the defined
contributions plans for all key employees (including any part of any
account balance distributed in the five-year period ending on the
determination date), and the present value of accrued benefits under
the defined benefit plans for all key employees as of the
determination date, and the denominator of which is the sum of the
account balances under the defined contribution plans for all
participants (including any part of any account balance distributed in
the five-year period ending on the determination date), and the
present value of accrued benefits under the defined benefit plans for
all participants as of the determination date.
(3) For purposes of (1) and (2) above, the value of account balances and
the present value of accrued benefits shall be determined as of the
most recent "valuation date" that falls within or ends with the
12-month period ending on the determination date, except as provided
in section 416 of the
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Code for the first and second plan years of a defined benefit plan. In
the case of a defined benefit plan, the "present value of accrued
benefits" shall be determined under the terms of the applicable
defined benefit plan. The account balances and accrued benefits of a
Participant who is not a key employee but who was a key employee in a
prior year, or who has not been credited with at least an Hour of
Service with any Participating Company maintaining the plan at any
time during the five-year period ending on the determination date
shall be disregarded. When aggregating plans, the value of account
balances and accrued benefits shall be calculated with reference to
the determination dates that fall within the same calendar year.
(4) The calculation of the top-heavy ratio shall be determined in
accordance with section 416 of the Code, the provisions of which are
incorporated herein by reference.
(i) "Valuation date" means the last day of the Plan Year.
ARTICLE XI
ADMINISTRATION
11.1 NAMED FIDUCIARIES. The Retirement Plan Administrative Committee shall
be the "named fiduciary" within the meaning of such term as used in ERISA;
provided that to the extent a Participant, former Participant or Beneficiary
directs that his Accounts be invested in the Harris Stock Fund,
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such Participant or Beneficiary and not the Retirement Plan Administrative
Committee shall be the "named fiduciary" with respect to such investment
decisions.
11.2 RETIREMENT PLAN ADMINISTRATIVE COMMITTEE. The Chief Executive Officer
of the Corporation shall have the power to appoint and to remove members to the
Retirement Plan Administrative Committee. A member of the Retirement Plan
Administrative Committee may resign at any time by giving written notice to the
Investment Committee or the Chief Executive Officer of the Corporation at least
15 days prior to the effective date of the resignation.
11.3 POWERS AND DUTIES OF COMMITTEE. The Retirement Plan Administrative
Committee shall have the powers and duties conferred on it by the terms of the
Plan. The Retirement Plan Administrative Committee may establish such rules and
regulations as it deems necessary to enable it to administer the Plan. The
Retirement Plan Administrative Committee shall have the discretionary authority
to determine eligibility for benefits and construe the terms of the Plan.
Benefits under the Plan will be paid only to a Participant or Beneficiary if the
Retirement Plan Administrative Committee decides in its discretion that the
Participant or Beneficiary is entitled to benefits.
11.4 ACTIONS OF COMMITTEE. No formal meeting and no minutes shall be
required with respect to actions taken by the Retirement Plan Administrative
Committee.
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11.5 FINALITY OF DECISIONS. All decisions and directions made by the
Retirement Plan Administrative Committee, in the discretionary exercise of its
powers and duties, shall be final and binding on all parties concerned.
11.6 IMMUNITIES. Except as otherwise provided by law, no member of the
Investment Committee or Retirement Plan Administrative Committee shall be liable
to a Participating Company or to any Participant or Beneficiary by reason of
such committee's exercise in good faith of any power or discretion vested in
such committee under the Plan.
11.7 ADVISORS AND AGENTS. The Corporation, Investment Committee, or, with
the consent of the Corporation or Investment Committee, the Retirement Plan
Administrative Committee, may employ one or more persons to render advice with
respect to any responsibility it has under the Plan. The Corporation or the
Investment Committee may appoint unrelated parties to carry out trustee and
investment management responsibilities with respect to the Plan. The Corporation
or the Retirement Plan Administrative Committee may appoint an unrelated party
to carry out the record-keeping responsibilities with respect to the Plan. The
Corporation shall indemnify any person, including any employee of the
Corporation, who is acting on behalf of the Corporation, Investment Committee or
Retirement Plan Administrative Committee in this capacity with respect to
liability that may arise by reason of such person's action or failure to act
concerning the Plan, excepting any willful or gross misconduct or criminal acts
to the extent required in the respective contracts governing such arrangements.
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11.8 COMMITTEE MEMBER WHO IS PARTICIPANT. A member of the Retirement Plan
Administrative Committee who also is a Participant shall have no right to vote
with respect to any action that pertains solely to him as a Participant. In the
event a majority of the remaining members are unable to agree as to the action
to be taken with respect to the Participant, the chief executive officer of the
Corporation shall appoint an impartial person to arbitrate the matter between
the remaining members and to reach a decision.
11.9 INFORMATION PROVIDED BY PARTICIPATING COMPANIES. Each Participating
Company and Employment Unit shall provide the Corporation, the Retirement Plan
Administrative Committee and the Trustee with complete and timely information
regarding employment data for each Employee and Participant needed by the
Corporation, Retirement Plan Administrative Committee or Trustee to administer
the Plan, including, but not limited to, information concerning Compensation,
date of employment, date of termination of employment, reason for termination
and any other information required by the Corporation, Retirement Plan
Administrative Committee, or Trustee.
11.10 EXPENSE. All costs and expenses incurred in administering the Plan
and the Trust, including the expenses of the Investment Committee and the
Retirement Plan Administrative Committee, investment advisory and record-keeping
fees, the fees of counsel and any agents for the Corporation, the fees and
expenses of the Trustee, the fees of counsel for the Trustee and other
administrative expenses shall be paid by the Trustee from the Trust Fund to the
extent that such expenses are not paid by the Participating Companies.
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The Retirement Plan Administrative Committee, in its sole discretion, having
regard for the nature of the particular expense, shall determine the portion of
such expense, if any, which is to be borne by any Participating Company. A
Participating Company may seek reimbursement of any expense paid by such company
that the Retirement Plan Administrative Committee determines is properly payable
by the Trust Fund.
11.11 TRUST. A trust shall be created by the execution of the Trust
Agreement between the Corporation and the Trustee. All contributions under the
Plan shall be paid to the Trustee. The Trustee shall hold all monies and other
property received by it and invest and reinvest the same, together with the
income therefrom, on behalf of the Participants collectively in accordance with
the provisions of the Trust Agreement. The Trustee shall make distributions from
the Trust Fund at such time or times to such person or persons and in such
amounts as the Retirement Plan Administrative Committee directs in accordance
with the Plan.
11.12 TRUST FUND AVAILABLE TO PAY ALL PLAN BENEFITS. The Plan is intended
to be a single plan under Treasury Regulation section 1.414(1)-1(b)(1). The
maintenance of Accounts as required by the terms of the Plan shall be for
record-keeping purposes only. All of the Trust Fund shall be available to pay
benefits to all Participants and Beneficiaries.
ARTICLE XII
AMENDMENT AND TERMINATION AND CHANGE OF CONTROL
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12.1 AMENDMENT. The Corporation reserves the right to amend the Plan by
action of its Board of Directors or the Investment Committee thereof at any time
and from time to time, subject to the following limitations:
(a) no amendment shall be made which vests in any Participating Company any
interest in any assets of the Plan other than as specifically provided in
section 12.2;
(b) no amendment shall be made which would have the effect of decreasing a
Participant's "accrued benefit" as proscribed in section 41l(d)(6) of the Code;
and
(c) no amendment shall have the effect of reducing a Participant's vested
interest in his Accounts. If the Plan is amended to change the vesting schedule,
each Participant with at least a three-year Period of Service shall have the
right to elect to have his vested interest computed without regard to the
amendment. Each Participant shall be permitted to make this election during the
period ending 60 days after the latest of the date (1) the amendment is adopted;
(2) the amendment is effective, and (3) the Participant is issued a written
notice of the amendment by the Corporation or its delegate.
12.2 TERMINATION OF PLAN. This Plan is intended to be permanent, and it is
the expectation of the Corporation that it will continue indefinitely. However,
the Corporation reserves the right to terminate the Plan by resolution of its
Board of Directors or the appropriate committee thereof. In the case of a
complete termination of the Plan, previously unallocated forfeitures shall be
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allocated as otherwise provided in the Plan. To the extent previously
unallocated forfeitures cannot be allocated because all Participants have
reached the limitations of section 415 of the Code, the unallocated amount shall
revert back to the appropriate Participating Company, as provided in section
3.10.
12.3 DISCONTINUANCE OF CONTRIBUTIONS. The Corporation reserves the right to
discontinue contributions to the Plan by amendment or by resolution of the Board
of Directors or the appropriate committee thereof
12.4 VESTING ON TERMINATION OR DISCONTINUANCE OF CONTRIBUTIONS. As of the
date of the partial or complete termination of the Plan or upon the complete
discontinuance of contributions to the Plan, each affected Participant shall
become fully vested in his Accounts and no further allocations of contributions
or forfeitures shall be made after such date on behalf of an affected
Participant.
12.5 DISTRIBUTION ON TERMINATION. Upon the complete termination of the
Plan, the Trustee shall distribute to each affected Participant the full amount
standing to the credit of his Accounts; provided that if such amount exceeds (or
at the time of any prior distribution exceeded) $5,000 (or such larger amount as
may be permitted by law) and the Participant is not yet age 65, such lump sum
shall not be paid without his consent. If the Participant does not consent, an
annuity contract shall be purchased for and distributed to the Participant.
12.6 CHANGE OF CONTROL.
(a) DEFINITION. Change in Control means the occurrence of any one of the
following events:
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(i) any "person" (as such term is defined in section 3(a)(9) of the
Securities Exchange Act of 1934 (the "Exchange Act") and as used in
sections 13(d)(3) and 14(d)(2) of the Exchange Act) is or becomes a
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Corporation representing 20
percent or more of the combined voting power of the Corporation's then
outstanding securities eligible to vote for the election of the Board of
Directors (the "Board") of the Corporation (the "Corporation Voting
Securities"); PROVIDED HOWEVER, that the event described in this paragraph
(i) shall not be deemed to be a Change in Control by virtue of any of the
following acquisitions: (A) by the Corporation or any Subsidiary, (B) by
any employee benefit plan sponsored or maintained by the Corporation or any
Subsidiary, (C) by any underwriter temporarily holding securities pursuant
to an offering of such securities, or (D) pursuant to a "Non-Control
Transaction" (as defined in paragraph (iii));
(ii) individuals who, on July 1, 1996, constitute the Board (the
"Incumbent Directors") cease for any reason to constitute at least a
majority of the Board, provided that any person becoming a director
subsequent to July 1, 1996, whose election or nomination for election was
approved by a vote of at least two-thirds of the Incumbent Directors who
remain on the Board (either by a specific
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vote or by approval of the proxy statement of the Corporation in which such
person is named as a nominee for director, without objection to such
nomination) shall also be deemed to be an Incumbent Director; PROVIDED,
HOWEVER, that no individual initially elected or nominated as a director of
the Corporation as a result of an actual or threatened election contest
with respect to directors or any other actual or threatened solicitation of
proxies or consents by or on behalf of any person other than the Board
shall be deemed to be an Incumbent Director;
(iii) the consummation of a merger, consolidation, share exchange or
similar form of corporate reorganization of the Corporation or any such
type of transaction involving the Corporation or any of its Subsidiaries
that requires the approval of the Corporation's stockholders (whether for
such transaction or the issuance of securities in the transaction or
otherwise) (a "Business Combination"), unless immediately following such
Business Combination: (A) more than 80 percent of the total voting power of
the corporation resulting from such Business Combination (including,
without limitation, any corporation which directly or indirectly has
beneficial ownership of 100 percent of the Corporation Voting Securities)
eligible to elect directors of such corporation is represented by shares
that were Corporation Voting Securities immediately prior to such Business
Combination (either
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by remaining outstanding or being converted), and such voting power is
in substantially the same proportion as the voting power of such
Corporation Voting Securities immediately prior to the Business
Combination, (B) no person (other than any publicly traded holding company
resulting from such Business Combination, any employee benefit plan
sponsored or maintained by the Corporation (or the corporation resulting
from such Business Combination)), becomes the beneficial owner, directly or
indirectly, of 20 percent or more of the total voting power of the
outstanding voting securities eligible to elect directors of the
corporation resulting from such Business Combination, and (C) at least a
majority of the members of the board of directors of the corporation
resulting from such Business Combination were Incumbent Directors at the
time of the Board's approval of the execution of the initial agreement
providing for such Business Combination (any Business Combination which
satisfies the conditions specified in (A), (B) and (C) shall be deemed to
be a "Non-Control Transaction"); or
(iv) the stockholders of the Corporation approve a plan of complete
liquidation or dissolution of the Corporation or the direct or indirect
sale or other disposition of all or substantially all of the assets of the
Corporation and its Subsidiaries. Notwithstanding the foregoing, a Change
in Control of the Corporation shall not be
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deemed to occur solely because any person acquires beneficial ownership of
more than 20 percent of the Corporation Voting Securities as a result of
the acquisition of Corporation Voting Securities by the Corporation which
reduces the number of Corporation Voting Securities outstanding, PROVIDED
THAT if after such acquisition by the Corporation such person becomes the
beneficial owner of additional Corporation Voting Securities that increases
the percentage of outstanding Corporation Voting Securities beneficially
owned by such person, a Change in Control of the Corporation shall then
occur.
For purposes of the definition of a "Change of Control", the term
"Subsidiary" shall mean any corporation or other entity in which the Corporation
has a direct or indirect ownership interest of 50 percent or more of the total
combined voting power of the then outstanding securities of such corporation or
other entity entitled to vote generally in the election of directors or in which
the Corporation has the right to receive 50 percent or more of the distribution
of profits or 50 percent of the assets on liquidation or dissolution.
Notwithstanding any other provisions of the Plan to the contrary, if a
Change in Control occurs, then during the period commencing on the date of
acquisition of said voting power, control of the Board, or consummation of a
Business Combination, and ending at the close of business on the last day of the
Fiscal Year that includes such date (the "Restriction Period"), the provisions
of this section 12.6 shall apply.
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(b) EFFECT. During the Restriction Period, the Plan may not be terminated
or amended to the extent the amendment would:
(1) reduce coverage under the Plan;
(2) reduce the amount of Profit-Sharing Contributions required to be made
for the Plan Year ending on the last day of the Restriction Period;
(3) reduce the amount of After-Tax Contributions eligible for a matching
contribution that a Participant is permitted to make or the amount of
the Matching After-Tax Contributions required under sections 3.5 and
3.6; or
(4) reduce the amount of Pre-Tax Contributions that a Participant is
permitted to make or the amount of Matching Pre-Tax Contributions
required under sections 3.3 and 3.4.
(c) For the purpose of computing the amount of the Profit-Sharing
Contributions for the twelve-month period ending on the last day of a
Restriction Period, the adjusted consolidated net income of the Corporation and
its Consolidated Subsidiaries before net income taxes for the Fiscal Year ending
on such date is deemed to be the forecast of the consolidated net income of the
Corporation and its Consolidated Subsidiaries for such Fiscal Year as set forth
in the annual operating plan of the Corporation for such Fiscal Year.
(d) During the Restriction Period, any person who was an Employee on the
day preceding the first day of the Restriction Period shall be
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deemed to be an Employee so long as he is employed by a member of a "controlled
group of corporations" which includes, or by a trade or business that is under
common control with (as those terms are defined in sections 414(b) and (c) of
the Code) the Corporation, any corporation which is the survivor of any merger
or consolidation to which the Corporation was a party, or any corporation into
which the Corporation has been liquidated.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
13.1 RESTRICTIONS ON ALIENATION: QUALIFIED DOMESTIC RELATIONS ORDERS.
Except as may be required (i) to offset an amount that a Participant is ordered
to pay to the Plan as a result of a judgement, settlement, order or decree
entered on or after August 5, 1997 as permitted under section 401(a)(13)(C) of
the Code or (ii) for income tax withholding purposes, no benefit or interest
under this Plan shall be subject to assignment or alienation, either voluntarily
or involuntarily. The preceding sentence shall apply to the creation, assignment
or recognition of a right to any benefit payable with respect to a Participant
pursuant to a domestic relations order, unless such order is determined by the
Retirement Plan Administrative Committee to be a "qualified domestic relations
order", as defined in section 414(p) of the Code. In accordance with uniform and
nondiscriminatory procedures established by the Retirement Plan Administrative
Committee from time to time, the Retirement Plan Administrative Committee upon
the receipt of a domestic relations order which seeks to require the
distribution of a Participant's Account in whole or in
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part to an "alternate payee" (as that term is defined in section 414(p)(8) of
the Code) shall:
(1) promptly notify the Participant and such "alternate payee" of the
receipt of such order and of the procedure which the Retirement Plan
Administrative Committee will follow to determine whether such order
constitutes a "qualified domestic relations order" within the meaning
of section 414(p) of the Code,
(2) determine whether such order constitutes a "qualified domestic
relations order" and notify the Participant and the "alternate payee"
of the results of such determination, and
(3) if the Retirement Plan Administrative Committee determines that such
order does constitute a "qualified domestic relations order,"
distribute to such "alternate payee" under the terms of such order the
amount called for under the order in a single sum within 60 days of
the date such order is determined to constitute a qualified domestic
relations order, without regard to whether a distribution would be
permissible to the Participant at such time under this Plan.
The determination and the distribution made by, or at the direction of,
the Retirement Plan Administrative Committee under this section 13.1 shall be
final and binding on the Participant and on all other persons interested in such
order. An "alternate payee" under this section 13.1 shall not be an eligible
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person for purposes of obtaining a loan pending the distribution of such
alternate payee's entire interest under this Plan.
13.2 EXCLUSIVE BENEFIT REQUIREMENT. Except as provided in sections 12.2,
13.1 and 13.3, no assets of the Plan shall revert to a Participating Company or
be used for or diverted to purposes other than providing benefits to
Participants and their Beneficiaries and defraying reasonable costs of
administering the Plan.
13.3 RETURN OF CONTRIBUTIONS.
(a) MISTAKE OF FACT. Any contribution made by a Participating Company due
to a mistake of fact shall be returned to the Participating Company within one
year of the date the contribution was made.
(b) NONDEDUCTIBLE CONTRIBUTIONS. In the event the deduction of a
contribution made by a Participating Company is disallowed under section 404 of
the Code, such contribution (to the extent disallowed) shall be returned to the
Participating Company within one year of the disallowance of the deduction.
13.4 NO CONTRACT OF EMPLOYMENT. Neither the establishment and maintenance
of the Plan, nor the participation in the Plan by any Employee shall be
construed as a contract between the Employee and any Participating Company so as
to give any Employee the right to be retained by any Participating Company, or
to interfere with the rights of any Participating Company to discharge the
Employee at any time.
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13.5 PAYMENT OF BENEFITS ON INCAPACITY. In the event the Retirement Plan
Administrative Committee determines that any person to whom a distribution is to
be made is unable to care for his affairs by reason of illness or other
disability, any amount distributable to such person (unless prior claim thereto
shall have been made by a duly qualified guardian or other legal representative)
may, in the discretion of the Retirement Plan Administrative Committee, be paid
to such other person deemed by the Retirement Plan Administrative Committee to
be responsible for such person. Any such payment made under this section 13.5
shall constitute a complete discharge of any liability under this Plan.
13.6 MERGER. In the event of a merger or consolidation with, or transfer of
assets or liabilities to any other plan, each Participant shall receive a
benefit immediately after such merger, consolidation or transfer (if the Plan
then terminated) which is at least equal to the benefit the Participant was
entitled to receive immediately before such merger, consolidation or transfer
(if the Plan had then terminated).
13.7 CONSTRUCTION. The headings and subheadings in this Plan have been
inserted for convenience of reference only and are to be ignored in the
construction of its provisions. Wherever appropriate, the masculine shall be
read as the feminine, the plural as the singular, and the singular as the
plural. References in this Plan to a section shall be to a section in this Plan
unless otherwise indicated. References in this Plan to a section of the Code,
ERISA or
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any other federal law shall also refer to the regulations issued under such
section.
13.8 GOVERNING LAW. This Plan shall be construed, to the extent to which
state law is applicable, in accordance with the laws of the State of Florida.
Venue for any action arising under this Plan shall be in Brevard County,
Florida.
13.9 MISTAKEN PAYMENTS. If a mistake is made in favor of a Participant,
Beneficiary or alternate payee in the payment of benefits under this Plan, then
the Corporation or the Trustee (acting at the Corporation direction and on
behalf of the Plan) shall take such action against such Participant, Beneficiary
or alternate payee to remedy such mistake and to make the Plan whole as the
Corporation deems proper and appropriate under the circumstances, and any
mistake in favor of the Plan shall promptly be corrected by, or at the direction
of, the Retirement Plan Administrative Committee.
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HARRIS CORPORATION
Date: August 30, 2000 By: /s/ David S. Wasserman
--------------------------------- ---------------------------------
Attest: /s/ R.L. Ballantyne Title: Vice President-Treasurer
------------------------------- ------------------------------
Secretary
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APPENDIX A
INVESTMENT FUNDS. The Investment Funds available under the plan as of
January 1, 1998 are as follows:
(a) BALANCED FUND. Assets held in this fund will be invested in a variety
of stocks, bonds, mortgages, fixed-income securities such as U.S. Treasury
bills, certificates of deposit, commercial paper and real estate.
(b) SHORT-TERM BOND FUND. Assets in this fund will be invested in
shorter-term fixed-income securities such as government bonds, U.S. Treasury
bills and notes, certificates of deposit, federal agency obligations, mortgage
securities and corporate bonds.
(c) MONEY MARKET FUND. Assets in this fund will be invested in a
diversified portfolio of high-quality, short-term fixed instruments such as U.S.
Treasury bills, federal agency obligations, commercial paper, certificates of
deposit and banker's acceptances.
(d) STABLE VALUE FUND. Assets held in this fund will be invested in a
diversified portfolio of investment contracts and short-term, high-quality fixed
income instruments that guarantee principal and a specified rate of return for a
specified period.
(e) EQUITY INCOME FUND. Assets held in this fund will be invested primarily
in dividend-paying common stocks of established companies but may also be
invested in convertible bonds and/or convertible preferred stock.
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(f) INDEXED EQUITY FUND. Assets held in this fund will be invested in a
stock portfolio that mirrors the Standard & Poor's 500 Stock Index.
(g) GROWTH FUND. Assets in this fund will be invested for the longer term,
primarily in common stocks of companies which are currently experiencing an
above-average rate of earnings growth. The fund's stock selection criteria
include a requirement that each company have a five-year average performance
record of sales, earnings, dividend growth, pre-tax margins, return on equity.
(h) HARRIS STOCK FUND. Assets in this fund will be invested in common stock
of the Corporation.
The Investment Funds may be changed at any time and from time to time.
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APPENDIX B
SPECIAL PROVISIONS FOR TRANSFERRED PARTICIPANTS
The provisions of this Appendix B are effective as of January 1, 1990.
(a) For purposes of this Appendix B, the following terms shall have the
following meanings:
(1) "TRANSFERRED PARTICIPANTS" means those former Employees whose
employment with a Participating Company ceased due to a sale of the
stock or assets of a Sold Operation.
(2) "SOLD OPERATION" means (i) the Data Communications Division and (ii)
the Chatsworth Operation.
(3) "CLOSING DATE" means the date as of which the sale of the relevant
Sold Operation was effective.
(b) Each Transferred Participant shall be fully vested in his Accounts as
of the relevant Closing Date.
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APPENDIX C
PARTICIPATING COMPANIES
The following Related Companies are Participating Companies as of the
respective dates set forth below:
Harris Corporation (January 1, 1998)
Audio Broadcast Group, Incorporated (November 24, 1999)
Harris Automation (January 11, 2000)
Baseview Products, Inc. (January 1, 1998)
Harris Intraplex, Inc. (July 1, 1999)
Harris Pacific, Inc. (October 5, 1999)
Harris Technical Services Corporation (January 1, 1998)
Harris Publishing Systems Corporation (January 1, 1998)
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APPENDIX D
FORMER PARTICIPANTS IN
THE INTRAPLEX, INC. 401(k) PROFIT SHARING PLAN
Effective as of July 1, 1999, the Harris Intraplex, Inc. 401(k) Profit
Sharing Plan (the "Intraplex Plan") was merged into the Plan and the accounts
maintained for participants under the Intraplex Plan were transferred to the
Plan. Notwithstanding anything in the Plan to the contrary, the following
provisions shall apply to the Participants whose accounts under the Intraplex
Plan were transferred to the Plan in connection with such merger (the "Intraplex
Participants"):
1. SERVICE. For purposes of determining an Intraplex Participant's Period
of Service, the Intraplex Participant shall be credited with a Period of Service
equal to (a) the number of whole Years of Service credited to the Intraplex
Participant under the Intraplex Plan as of June 30, 1999, plus (b) the greater
of (1) the Period of Service that would be credited the Intraptex Participant
under Article 2 of the Plan during the Plan Year commencing on July 1, 1999, and
(2) the service that would be credited to the Intraplex Participant under the
terms of the Intraplex Plan for the Plan Year commencing on July 1, 1999.
2. DISTRIBUTIONS. If the total vested value of an Intraplex Participant's
account under the Plan (including the amount transferred to the Plan from the
Intraplex Plan) exceeds $5,000 (or such other amount prescribed by Section
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411(a)(11) of the Code) at the time the Intraplex Participant requests a
distribution from the Plan, the Intraplex Participant's spouse must consent to
the distribution of the amount contained in the Participant's account
transferred to the Plan from the Intraplex Plan effective July 1, 1999. Such
consent shall be obtained in writing within the 90-day period ending on the date
that the distribution commences.
D-2
