<PAGE>
As filed with the Securities and Exchange Commission on July 18, 1995
Registration No. 33-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
The Securities Act of 1933
Illinois Central Corporation
(Exact name of registrant as specified in its charter)
Delaware 13-3545405
(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
455 North Cityfront Plaza Drive, Chicago, Illinois 60611-5504
(Address of Principal Executive Offices including Zip Code)
Illinois Central Railroad Company Union Employees' Savings Plan
(Full title of plan)
Ronald A. Lane, 455 North Cityfront Plaza Drive, (312) 755-7500
Chicago, Illinois 60611-5504
(Name, address and telephone number of agent for service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of maximum maximum
securities Amount offering aggregate Amount of
to be to be price offering registration
registered(1) registered(2) per share(3) price(3) fee
Common Stock 100,000 $39.3125 $3,931,250 $1,356
$.001 par value shares
(1) Pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of
interests to be offered or sold pursuant to the employee benefit
plans described herein.
(2) Includes an indeterminate number of shares of Common Stock that
may be issuable by reason of stock splits, stock dividends or
similar transactions.
(3) The amounts are based upon the average of the high and low sale
prices for the Common Stock as reported on The Wall Street Journal
- Midwest Edition for July 14, 1995 and are used solely for the
purpose of calculating the registration fee pursuant to Rule 457(c)
under the Securities Act of 1933.
<PAGE>
PART I
INFORMATION REQUIRED IN PROSPECTUS
The information called for in Part I of Form S-8 is currently
included in a Summary Plan Description of the Illinois Central Railroad
Company Union Employees' Savings Plan (the "Plan") and in a Supplement
to the such Summary Plan Description and is not being filed with or
included in this Form S-8 in accordance with the rules and regulations
of the Securities and Exchange Commission.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed with the SEC are incorporated in
this Registration Statement by reference:
1. Illinois Central Corporation's (the "Company") Annual Report
on Form 10-K for the year ended December 31, 1994, SEC File No. 1-10720.
2. The Company's Quarterly Reports on Form 10-Q for the quarter
ended March 31, 1995, SEC File No. 1-10720.
3. The description of the Company's Common Stock, contained in the
Company's Restated Articles of Incorporation filed as Exhibit 3.1 to the
Current Report of the Illinois Central Corporation on Form 8-K dated
July 29, 1994, SEC File No. 1-10720.
4. Any and all other reports filed by the Company pursuant to
Sections 13(a) or 15(d) of the Securities Exchange Act of 1934 (the
"Exchange Act") since December 31, 1993.
In addition, all documents filed by the Company or the Plan
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act,
after the date of this registration statement and prior to the filing
of a post-effective amendment which indicates that all securities
offered hereby have been sold or which deregisters all such securities
then remaining unsold, shall be deemed to be incorporated in this
registration statement by reference and to be a part hereof from the
date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this registration
statement to the extent that a statement contained herein or in any
subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement.
The Company hereby undertakes to provide without charge to each
person who has received a copy of the prospectus to which this
registration statement relates, upon the written or oral request of any
such person, a copy of the Company's Annual Report to Stockholders for
its last fiscal year and a copy of any or all the documents that have
been or may be incorporated by reference into this registration
statement, other than exhibits to such documents (unless such exhibits
are incorporated by reference). The Company hereby further undertakes
to deliver or cause to be delivered to all participants who do not
otherwise receive such material, copies of all reports, proxy statements
and other communications distributed by the Company to its stockholders
generally, no later than the time such materials are first sent to its
stockholders.
Item 4. Description of Securities.
See description contained in the Company's Restated Articles of
Incorporation (See Item 3.- No. 3 herein).
Item 5. Interests Named Experts and Counsel.
The legality of the shares offered hereby have been passed upon
by Ronald A. Lane, Vice President, General Counsel and Secretary of the
Company. As of July 1, 1995, Mr. Lane beneficially owned 100,091 shares
of Company Common Stock and has options to purchase 24,200 shares of
Company Common Stock. A total of 2,750 Options are exercisable at
July 1, 1995.
The consolidated financial statements and financial statement schedules
of the Company included in the Company's Annual Report on Form 10-K for the
year ended December 31, 1994, which are incorporated by reference in this
Registration Statement, have been audited by Arthur Andersen LLP,
independent public accountants, as indicated in their report with respect
thereto, which is incorporated by reference herein in reliance upon the
authority of such firm as experts in accounting and auditing in giving said
report. Reference is made to said report, which includes an explanatory
paragraph with respect to the Company's change in its methods of accounting
for income taxes and for postretirement, health care and postemployment
benefits as discussed in Notes 11 and 10, respectively, to the consolidated
financial statements.
Item 6. Indemnification of Directors and Officers.
Article Seven ("Article Seven") of the Company's Restated
Certificate of Incorporation (the "Company Certificate") limits the
scope of personal liability of the Company's directors to the Company
or its stockholders for monetary damages for breach of fiduciary duty
as a director and, along with Article VIII of the By-Laws of the Company
("Article VIII"), defines the rights of the Company directors and
officers to indemnification by the Company in the event of personal
liability or expenses incurred by them as a result of certain litigation
against them. Set forth below are descriptions of Article Seven and
Article VIII.
Elimination of Liability in Certain Circumstances: Indemnification
and Insurance.
The Delaware General Corporation Law (the "GCL") empowers the
Company to indemnify, subject to the standards therein prescribed, any
person in connection with any action, suit or proceeding brought or
threatened by reason of the fact that such person is or was a director,
officer, employee or agent of the Company or is or was serving as such
with respect to another corporation or other entity at the request of
the Company. Article Seven of the Company Certificate requires the
Company to indemnify directors and officers, or any other person with
such right as may be determined by the Company, to the fullest extent
permitted by the GCL.
In addition, the GCL authorizes corporations to limit or eliminate
the personal liability of directors to corporations and their
stockholders for monetary damages for breach of directors' fiduciary
duty of care. Article Seven of the Company Certificate limits the
liability of the directors to the Company or its stockholders (in their
capacity as directors but not in their capacity as officers) to the
fullest extent permitted by the GCL. Specifically, directors of the
Company will not be personally liable for monetary damages for breach
of a director's fiduciary duty as a director, except, as provided in the
GCL, for liability (a) for any breach of the director's duty of loyalty
to the Company or its stockholders, (b) for acts or omissions not in
good faith or which involve intentional misconduct or a knowing
violation of law, (c) for unlawful payments of dividends or unlawful
stock repurchases or redemptions, or (d) for any transaction from which
the director derived an improper personal benefit. The Company
Certificate also provides that if the GCL is amended after the effective
date of such Company Certificate to authorize corporate action further
eliminating or limiting the personal liability of directors, then the
liability of a director of the Company will be eliminated or limited to
the fullest extent permitted by the GCL, as so amended.
The directors and officers of the Company, and certain other
employees or agents as determined by the Company, are covered by an
insurance policy, indemnifying them against certain civil liabilities,
including liabilities under the federal securities laws, which might be
incurred by them in such capacity.
The Plan states that, to the extent permitted by law, the Company
shall indemnify and hold harmless each member of the Committee, the
chief executive officer and each other officer or employee of the
Company or an Employer (as defined in the Plan), to whom are delegated
duties, responsibilities and authority with respect to the Plan, against
any and all liabilities, losses, costs or expenses (including legal fees
and expenses) of whatever nature, which may be imposed on, incurred by,
or against him at any time by reason of his service under the Plan, if
he did not act dishonestly with gross negligence or otherwise in knowing
violation of the law under which such liability, loss, cost or expense
arises.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
4.1 Form of the Illinois Central Railroad Company Union
Employees' Savings Plan.
4.2 Form of the Trust Agreement between Illinois Central
Railroad Company and Continental Trust Company ("CTC") as
Trustee, as amended.
4.3 Restated Articles of Incorporation of the Company.
(Incorporated by reference to Exhibit 3.1 to the Current
Report of the Illinois Central Corporation on Form 8-K dated
July 29, 1994. (SEC File No. 1-10720))
4.4 By-Laws of the Company, as amended. (Incorporated by
reference to Exhibit 3.4 to the Registration Statement of
Illinois Central Corporation and Illinois Central Railroad
Company on Form S-1. (SEC File No. 33-36321 and 33-36321-01))
4.5 Certificate of Retirement of Illinois Central Corporation
(Incorporated by reference to Exhibit 3.3 to the
Registration Statement of Illinois Central Corporation and
Illinois Central Railroad Company on Form S-1, as amended.
(SEC File No. 33-40696 and Post-Effective Amendments to
Registration Statements No.s 33-36321 and 33-36321-01))
4.6 Certificate of Elimination of Illinois Central Corporation.
(Incorporated by reference to Exhibit 3.2 to the Quarterly
Report of the Illinois Central Corporation on Form 10-Q for
the three months ended September 30, 1991. (SEC File No.
1-10720))
5 Opinion re: Legality.
23.1 Consent of Arthur Andersen LLP
23.2 Consent of Ronald A. Lane (See Exhibit 5).
24 Power of Attorney (included on the signature page of this
Registration Statement).
Item 9. Undertakings.
1. The Company hereby undertakes:
(a) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) which, individually, or in the aggregate, represent
a fundamental change in the information set forth in the
Registration Statement;
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in the
Registration Statement or any material change to such
information in the Registration Statement;
Provided, however, that paragraphs (a)(i) and (a)(ii) do not
apply if the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic
reports filed by the registrant pursuant to Section 13 or Section
15(d) of the Exchange Act that are incorporated by reference in
the Registration Statement.
(b) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(c) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
2. The Company hereby undertakes that, for the purpose of
determining any liability under the Securities Act of 1933, each such
post-effective amendment and each filing of the Company's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the Registration Statement shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
3. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors and officers of the
Company and subsidiary companies pursuant to the foregoing provisions,
or otherwise, the Company has been informed that in the opinion of the
SEC such indemnification is against public policy as expressed in the
Act and is therefore unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Company of expenses incurred or paid by a director, officer or
controlling person of the Company in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the Company will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
4. The Company undertakes that it will submit or has submitted
the Plan and any amendment thereto to the Internal Revenue Service in
a timely manner and has made or will make all changes required by the
Internal Revenue Service in order to qualify the Plan under Section 401
of the Internal Revenue Code.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and
has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Chicago, State of Illinois, on July 18, 1995.
ILLINOIS CENTRAL CORPORATION
By:/S/ DALE W. PHILLIPS
Dale W. Phillips, Vice President
& Chief Financial Officer
<PAGE>
POWER OF ATTORNEY
The Registrant and each person whose signature appears below
constitutes and appoints E. Hunter Harrison, Dale W. Phillips and
Ronald A. Lane, and any agent for service named in this
Registration Statement and each of them, his, her or its true and
lawful attorneys-in-fact and agents, with full power of
substitution and resubstitution, for him, her or it and in his,
her, or its name, place and stead, in any and all capacities, to
sign any and all amendments (including post-effective amendments)
to this Registration Statement, with all exhibits thereto, and
other documents in connection therewith, with the Securities and
Exchange Commission, granting unto said attorneys-in-fact and
agents, and each of them, full power and authority to do and
perform each and every act and thing requisite or necessary to be
done in and about the premises, as fully to all intents and
purposes as he, she, or it might or could do in person, hereby
ratifying and confirming all that said attorneys-in-fact and agents
or any of them, or their or his substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following
persons in the capacities and on the dates indicated.
/s/GILBERT H. LAMPHERE Chairman of the Board July 18, 1995
and Director
/s/E. HUNTER HARRISON President and Chief Executive
Officer (principal executive
officer) and Director July 18, 1995
/s/THOMAS A. BARRON Director July 18, 1995
/s/GEORGE D. GOULD Director July 18, 1995
/s/WILLIAM B. JOHNSON Director July 18, 1995
/s/ALEXANDER P. LYNCH Director July 18, 1995
/s/SAMUEL F. PRYOR, IV Director July 18, 1995
/s/F. JAY TAYLOR Director July 18, 1995
/s/JOHN V. TUNNEY Director July 18, 1995
/s/ALAN H. WASHKOWITZ Director July 18, 1995
/s/DALE W. PHILLIPS Vice President and Chief
Financial Officer
(principal financial officer) July 18, 1995
/s/JOHN V. MULVANEY Controller (principal
accounting officer) July 18, 1995
<PAGE>
THE PLAN
Pursuant to the requirements of the Securities Act of 1933, the
Plan has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
Chicago, State of Illinois, on the 18th day of July 1995.
ILLINOIS CENTRAL RAILROAD COMPANY
UNION EMPLOYEES' SAVINGS PLAN
By: /s/ JAMES M. HARRELL
JAMES M. HARRELL
<PAGE>
ILLINOIS CENTRAL CORPORATION
AND SUBSIDIARIES
Exhibit Index
Sequential
Exhibit No. Descriptions Page No.
4.1 Form of the Illinois Central Railroad Company
Union Employees' Savings Plan (A)
4.2 Form of the Trust Agreement between Illinois
Central Railroad Company and Continental Trust
Company ("CTC") as Trustee, as amended. (A)
4.3 Restated Articles of Incorporation of the Company.
(Incorporated by reference to Exhibit 3.1 to the
Current Report of the Illinois Central Corporation
on Form 8-K dated July 29, 1994. (SEC File No. 1-10720))
4.4 By-Laws of the Company, as amended. (Incorporated
by reference to Exhibit 3.4 to the Registration
Statement of Illinois Central Corporation and
Illinois Central Railroad Company on Form S-1.
(SEC File No. 33-36321 and 33-36321-01))
4.5 Certificate of Retirement of Illinois Central
Corporation (Incorporated by reference to
Exhibit 3.3 to the Registration Statement of
Illinois Central Corporation and Illinois Central
Railroad Company on Form S-1, as amended.
(SEC File No. 33-40696 and Post-Effective
Amendments to Registration Statements
Nos. 33-36321 and 33-36321-01))
4.6 Certificate of Elimination of Illinois Central
Corporation. (Incorporated by reference to
Exhibit 3.2 to the Quarterly Report of the
Illinois Central Corporation on Form 10-Q
for the three months ended September 30, 1991.
(SEC File No. 1-10720))
5 Opinion re: Legality E-2
23.1 Consent of Arthur Andersen LLP E-3
23.2 Consent of Ronald A. Lane (See Exhibit 5).
24 Power of Attorney (included on the signature
page of this Registration Statement, see II-7).
(A) Included herein but not reproduced
EXHIBIT 4.1
ILLINOIS CENTRAL RAILROAD COMPANY
UNION EMPLOYEES' SAVINGS PLAN
CERTIFICATE
I, , Secretary of Illinois Central Railroad
Company, hereby certify that the attached document is a correct copy of
Illinois Central Railroad Company Union Employees' Savings Plan as adopted
effective June 26, 1995.
Dated this day of _________________, 1995.
As Secretary as Aforesaid
(Seal)
IN WITNESS WHEREOF, the Company has caused this Illinois Central
Railroad Company Union Employees' Savings Plan to be executed on its
behalf in counterpart originals by an officer thereunto duly authorized,
and its seal affixed, this day of June, 1995.
ILLINOIS CENTRAL RAILROAD COMPANY
By
Its
(Corporate Seal)
TABLE OF CONTENTS
Page
ARTICLE I DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1. "Accounting Period". . . . . . . . . . . . . . . . . . . . . 1
1.2. "Accounts" . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3. "Account Balance". . . . . . . . . . . . . . . . . . . . . . 2
1.4. "Appendix" . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.5. "Authorized Leave of Absence". . . . . . . . . . . . . . . . 2
1.6. "Beneficiary". . . . . . . . . . . . . . . . . . . . . . . . 2
1.7. "Commonly Controlled Entity" . . . . . . . . . . . . . . . . 2
1.8. "Company". . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.9. "Company Stock". . . . . . . . . . . . . . . . . . . . . . . 2
1.10. "Compensation" . . . . . . . . . . . . . . . . . . . . . . . 3
1.11. "Contributions". . . . . . . . . . . . . . . . . . . . . . . 4
1.12. "Contribution Dollar Limit". . . . . . . . . . . . . . . . . 4
1.13. "Contribution Election" or "Election". . . . . . . . . . . . 4
1.14. "Contribution Percentage". . . . . . . . . . . . . . . . . . 4
1.15. "Effective Date" . . . . . . . . . . . . . . . . . . . . . . 4
1.16. "Eligible Employee". . . . . . . . . . . . . . . . . . . . . 4
1.17. "Employee" . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.18. "Employer" . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.19. "ERISA". . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.20. "Fair Market Value". . . . . . . . . . . . . . . . . . . . . 5
1.21. "Family Member". . . . . . . . . . . . . . . . . . . . . . . 5
1.22. "Highly Compensated Eligible Employee" or "HCE". . . . . . . 5
1.23. "Internal Revenue Code" or "Code". . . . . . . . . . . . . . 6
1.24. "Investment Election". . . . . . . . . . . . . . . . . . . . 6
1.25. "Investment Fund" or "Fund". . . . . . . . . . . . . . . . . 7
1.26. "Named Fiduciary". . . . . . . . . . . . . . . . . . . . . . 7
1.27. "Non-Highly Compensated Employee" or "NHCE". . . . . . . . . 7
1.28. "Normal Retirement Date" . . . . . . . . . . . . . . . . . . 7
1.29. "Participant". . . . . . . . . . . . . . . . . . . . . . . . 7
1.30. "Payment Date" . . . . . . . . . . . . . . . . . . . . . . . 7
1.31. "Plan" . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.32. "Plan Year". . . . . . . . . . . . . . . . . . . . . . . . . 8
1.33. "Pre-Tax Contributions". . . . . . . . . . . . . . . . . . . 8
1.34. "QDRO" . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.35. "Qualified Matching Contribution". . . . . . . . . . . . . . 8
1.36. "Related Plan" . . . . . . . . . . . . . . . . . . . . . . . 8
1.37. "Rollover Contribution". . . . . . . . . . . . . . . . . . . 8
1.38. "Spousal Consent". . . . . . . . . . . . . . . . . . . . . . 8
1.39. "Spouse" . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.40. "Termination of Employment". . . . . . . . . . . . . . . . . 9
1.41. "Trust". . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.42. "Trust Agreement". . . . . . . . . . . . . . . . . . . . . . 9
1.43. "Trust Fund" . . . . . . . . . . . . . . . . . . . . . . . . 9
1.44. "Trustee". . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.45. "Valuation Date" . . . . . . . . . . . . . . . . . . . . . . 9
ARTICLE II PARTICIPATION. . . . . . . . . . . . . . . . . . . . . . . . 10
2.1. Eligibility. . . . . . . . . . . . . . . . . . . . . . . . . 10
2.2. Reemployment . . . . . . . . . . . . . . . . . . . . . . . . 10
2.3. Participation Upon Change of Job Status. . . . . . . . . . . 10
2.4. Uniformed Service. . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE III PARTICIPANT CONTRIBUTIONS . . . . . . . . . . . . . . . . . 11
3.1. Pre-Tax Contribution Election. . . . . . . . . . . . . . . . 11
3.2. Election Procedures. . . . . . . . . . . . . . . . . . . . . 11
3.3. Limitation on Pre-Tax Contributions For All Participants . . 12
3.4. Post-Tax Contributions . . . . . . . . . . . . . . . . . . . 12
ARTICLE IV EMPLOYER CONTRIBUTIONS AND ALLOCATIONS. . . . . . . . . . . 13
4.1. Pre-Tax Contributions. . . . . . . . . . . . . . . . . . . . 13
4.2. Matching Contributions . . . . . . . . . . . . . . . . . . . 13
4.3. Miscellaneous. . . . . . . . . . . . . . . . . . . . . . . . 13
ARTICLE V ROLLOVERS . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.1. Rollovers to the Plan. . . . . . . . . . . . . . . . . . . . 14
5.2. Rollovers From The Plan. . . . . . . . . . . . . . . . . . . 14
ARTICLE VI ACCOUNTING FOR PARTICIPANTS'ACCOUNTS
AND FOR INVESTMENT FUNDS. . . . . . . . . . . . . . . . . . . . . 16
6.1. Individual Participant Accounting. . . . . . . . . . . . . . 16
6.2. Accounting for Investment Funds. . . . . . . . . . . . . . . 16
6.3. Accounting for Company Stock . . . . . . . . . . . . . . . . 16
ARTICLE VII INVESTMENT FUNDS AND ELECTIONS. . . . . . . . . . . . . . . 18
7.1. Investment Funds . . . . . . . . . . . . . . . . . . . . . . 18
7.2. Investment of Contributions. . . . . . . . . . . . . . . . . 18
7.3. Investment of Accounts . . . . . . . . . . . . . . . . . . . 18
7.4. Establishment of Investment Funds. . . . . . . . . . . . . . 19
7.5. Transition Rules . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE VIII VESTING. . . . . . . . . . . . . . . . . . . . . . . . . . 20
8.1. Fully Vested Contribution Accounts . . . . . . . . . . . . . 20
ARTICLE IX IN-SERVICE WITHDRAWALS. . . . . . . . . . . . . . . . . . . 21
9.1. Withdrawals for 401(k) Hardship. . . . . . . . . . . . . . . 21
9.2. Withdrawals for Participants Over Age 59.5 . . . . . . . . . 22
9.3. Withdrawals for General Hardship . . . . . . . . . . . . . . 22
9.4. Withdrawal Rules . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE X DISTRIBUTIONS ON AND AFTER TERMINATION
OF EMPLOYMENT . . . . . . . . . . . . . . . . . . . . . . . . . . 24
10.1. Request for Distribution of Benefits . . . . . . . . . . . . 24
10.2. Deadline for Distribution. . . . . . . . . . . . . . . . . . 24
10.3. Payment Form and Medium. . . . . . . . . . . . . . . . . . . 24
10.4. Small Amounts Paid Immediately . . . . . . . . . . . . . . . 25
ARTICLE XI DISTRIBUTION OF ACCOUNT BALANCES ON DEATH. . . . . . . . . . 26
11.1. Payment to Beneficiary . . . . . . . . . . . . . . . . . . . 26
11.2. Beneficiary Designation. . . . . . . . . . . . . . . . . . . 26
11.3. Benefit Election . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE XII MAXIMUM CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . 27
12.1. Maximum Annual Additions . . . . . . . . . . . . . . . . . . 27
12.2. Correcting an Annual Excess. . . . . . . . . . . . . . . . . 28
12.3. Two-Plan Limit . . . . . . . . . . . . . . . . . . . . . . . 28
12.4. Short Plan Year. . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE XIII ADP AND ACP TESTS. . . . . . . . . . . . . . . . . . . . . 30
13.1. Contribution Limitation Definitions. . . . . . . . . . . . . 30
13.2. Collectively Bargained Employees . . . . . . . . . . . . . . 31
13.3. ADP and ACP Tests. . . . . . . . . . . . . . . . . . . . . . 32
13.4. Correction of ADP and ACP Tests. . . . . . . . . . . . . . . 32
13.5. Method of Calculation. . . . . . . . . . . . . . . . . . . . 33
13.6. Multiple Use Test. . . . . . . . . . . . . . . . . . . . . . 34
13.7. Adjustment for Investment Gain or Loss . . . . . . . . . . . 34
13.8. Required Records . . . . . . . . . . . . . . . . . . . . . . 34
13.9. Incorporation by Reference . . . . . . . . . . . . . . . . . 34
13.10. QSLOB. . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
ARTICLE XIV TRUST AGREEMENT . . . . . . . . . . . . . . . . . . . . . . 35
14.1. Trust Agreement. . . . . . . . . . . . . . . . . . . . . . . 35
14.2. Selection of Trustee . . . . . . . . . . . . . . . . . . . . 35
14.3. Trustee's Duties and Fees. . . . . . . . . . . . . . . . . . 35
14.4. Separate Entity. . . . . . . . . . . . . . . . . . . . . . . 35
14.5. Plan Asset Valuation . . . . . . . . . . . . . . . . . . . . 35
14.6. Right of Employers to Plan Assets. . . . . . . . . . . . . . 36
ARTICLE XV ADMINISTRATION AND INVESTMENT MANAGEMENT . . . . . . . . . . 37
15.1. General. . . . . . . . . . . . . . . . . . . . . . . . . . . 37
15.2. Procedures for Designation of a Named Fiduciary. . . . . . . 37
15.3. Responsibility and Powers of the Company Regarding
Administration of the Plan. . . . . . . . . . . . . . . . . 37
15.4. Information to be Supplied by Named Fiduciary. . . . . . . . 39
15.5. Misrepresentations . . . . . . . . . . . . . . . . . . . . . 39
15.6. Records. . . . . . . . . . . . . . . . . . . . . . . . . . . 39
15.7. Plan Expenses. . . . . . . . . . . . . . . . . . . . . . . . 39
15.8. Fiduciary Capacity . . . . . . . . . . . . . . . . . . . . . 39
15.9. Employer's Agent . . . . . . . . . . . . . . . . . . . . . . 39
15.10. Plan Administrator . . . . . . . . . . . . . . . . . . . . . 39
15.11. Named Fiduciary Decisions Final. . . . . . . . . . . . . . . 40
15.12. No Agency. . . . . . . . . . . . . . . . . . . . . . . . . . 40
ARTICLE XVI CLAIMS PROCEDURE. . . . . . . . . . . . . . . . . . . . . . 41
16.1. Initial Claim for Benefits . . . . . . . . . . . . . . . . . 41
16.2. Review of Claim Denial . . . . . . . . . . . . . . . . . . . 41
ARTICLE XVII ADOPTION AND WITHDRAWAL FROM PLAN. . . . . . . . . . . . . 43
17.1. Procedure for Adoption . . . . . . . . . . . . . . . . . . . 43
17.2. Procedure for Withdrawal . . . . . . . . . . . . . . . . . . 43
ARTICLE XVIII AMENDMENT, TERMINATION AND MERGER . . . . . . . . . . . . 44
18.1. Amendments . . . . . . . . . . . . . . . . . . . . . . . . . 44
18.2. Plan Termination . . . . . . . . . . . . . . . . . . . . . . 44
18.3. Plan Merger. . . . . . . . . . . . . . . . . . . . . . . . . 45
18.4. Action by Company or Employer. . . . . . . . . . . . . . . . 45
ARTICLE XIX SPECIAL TOP-HEAVY RULES . . . . . . . . . . . . . . . . . . 46
19.1. Application. . . . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE XX MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . . . . . 47
20.1. Assignment and Alienation. . . . . . . . . . . . . . . . . . 47
20.2. Notice and Information Requirements. . . . . . . . . . . . . 47
20.3. Plan Does Not Affect Employment Rights . . . . . . . . . . . 48
20.4. Deduction of Taxes from Amounts Payable. . . . . . . . . . . 48
20.5. Facility of Payment. . . . . . . . . . . . . . . . . . . . . 48
20.6. Source of Benefits . . . . . . . . . . . . . . . . . . . . . 48
20.7. Indemnification. . . . . . . . . . . . . . . . . . . . . . . 48
20.8. Reduction for Overpayment. . . . . . . . . . . . . . . . . . 48
20.9. Limitation on Liability. . . . . . . . . . . . . . . . . . . 49
20.10. Company Merger . . . . . . . . . . . . . . . . . . . . . . . 49
20.11. Employees' Trust . . . . . . . . . . . . . . . . . . . . . . 49
20.12. Gender and Number. . . . . . . . . . . . . . . . . . . . . . 49
20.13. Invalidity of Certain Provisions . . . . . . . . . . . . . . 49
20.14. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . 49
20.15. Uniform and Nondiscriminatory Treatment. . . . . . . . . . . 49
20.16. Law Governing. . . . . . . . . . . . . . . . . . . . . . . . 49
<PAGE>
ILLINOIS CENTRAL RAILROAD COMPANY
UNION EMPLOYEES' SAVINGS PLAN
Illinois Central Railroad Company has established the Illinois
Central Railroad Company Union Employees' Savings Plan for the benefit of
eligible union employees of the Company and its participating affiliates.
The Plan is intended to constitute a qualified profit sharing plan, as
described in Code Section 401(a), which includes a qualified cash or
deferred arrangement, as described in Code Section 401(k).
ARTICLE I
DEFINITIONS
The following sections of this Article I provide basic definitions
of terms used throughout the Plan, and whenever used herein in a
capitalized form, except as otherwise expressly provided, the terms shall
be deemed to have the following meanings:
1.1. "Accounting Period" means the periods designated by the
Company with respect to each Investment Fund not to exceed one year in
duration.
1.2. "Accounts" means the record of a Participant's interest in
the Plan's assets represented by his or her:
(a) "Matching Account" which means a
Participant's interest in the Plan's assets
composed of Matching Contributions allocated
to the Participant under the Plan, if any,
plus all income and gains credited to, and
minus all losses, expenses, withdrawals and
distributions charged to, such Account.
(b) "Pre-Tax Account" which means a Participant's
interest in the Plan's assets composed of
Pre-Tax Contributions allocated to the
Participant under the Plan, if any, plus all
income and gains credited to, and minus all
losses, expenses, withdrawals and
distributions charged to, such Account.
(c) "Rollover Account" which means a
Participant's interest in the Plan's assets
composed of Rollover Contributions allocated
to the Participant under the Plan, if any (as
identified by the Company), plus all income
and gains credited to, and minus all losses,
expenses, withdrawals and distributions
charged to, such Account.
1.3. "Account Balance" means the amounts held in or posted to a
Participant's Accounts on any Valuation Date.
1.4. "Appendix" means a written supplement attached to this Plan
and made part hereof which has been added in accordance with the provisions
of the Plan.
1.5. "Authorized Leave of Absence" means an absence, with or
without Compensation, authorized on a nondiscriminatory basis by a
Commonly Controlled Entity under its standard personnel practices
applicable to the Employee, including any period of time during which such
person is covered by a short-term disability plan of his or her Employer.
The date that an Employee's Authorized Leave of Absence ends shall be
determined in accordance with the personnel policies of such Commonly
Controlled Entity, which ending date shall be no earlier than the date
that the Authorized Leave of Absence is scheduled to end, unless the
Employee communicates to such Commonly Controlled Entity that he or she
is to have a Termination of Employment as of an earlier date. An Employee
who leaves the service of a Commonly Controlled Entity to enter the Armed
Forces of the United States of America and who reenters the service of the
Commonly Controlled Entity with reemployment rights in accordance with the
Uniformed Services Employment and Reemployment Rights Act ("USERRA") shall
be entitled to credit for service and contributions as required by USERRA.
1.6. "Beneficiary" means any person designated by a Participant
to receive any benefits that shall be payable with respect to the death
of a Participant under the Plan or as a result of a QDRO.
1.7. "Commonly Controlled Entity" means: (i) an Employer and any
corporation, trade or business, but only for so long as it and the
Employer are members of a controlled group of corporations as defined in
Section 414(b) of the Code or under common control as defined in Section
414(c) of the Code; provided, however, that solely for purposes of the
limitations of Code Section 415, the standard of control under Sections
414(b) and 414(c) of the Code shall be deemed to be "more than 50%" rather
than "at least 80%;" (ii) an Employer and an organization, but only for
so long as it and the Employer are, on and after the Effective Date,
members of an affiliated service group as defined in Section 414(m) of the
Code; (iii) an Employer and an organization, but only for so long as the
employees of it and the Employer are required to be aggregated, on and
after the Effective Date, under Section 414(o) of the Code; or (iv) any
other organization designated as such by the Company.
1.8. "Company" means Illinois Central Railroad Company or any
successor corporation by merger, consolidation, purchase, or otherwise,
which elects to adopt the Plan and the Trust.
1.9. "Company Stock" means common stock issued by Illinois
Central Corporation.
1.10. "Compensation" means:
(a) for purposes of allocating Contributions, all
earned income and wages paid to an Eligible
Employee by an Employer, including base pay
and overtime, but excluding long-term
disability payments, per diems, meal and
housing allowances and other reimbursements,
moving or relocation expenses or
reimbursements, fringe benefits, supplemental
sickness benefits, sickness or unemployment
benefits paid by Railroad Retirement,
compensation for services on the basis of a
percentage of profits, disciplinary or
judicially ordered back pay awards, severance
benefits, unused vacation pay, payments in
settlement of personal injuries, and lump sum
payments;
(b) for purposes of applying Section 415 of the
Code to the Plan and its Participants for any
limitation year, such compensation as
determined by the Company and satisfying the
definition of compensation under Section 415
of the Code; and
(c) for any determination period with respect to
an applicable provision of the Code other
than Section 415, such compensation as
determined by the Company and which satisfies
the requirements of Section 414(s) of the Code.
Notwithstanding the foregoing provisions, Compensation shall include
elective amounts excludible from gross income under Code Sections 125 and
401(k) (other than for Code Section 415 purposes).
Compensation shall be measured by an annual accounting period that
approximates the calendar year, and for which the Employer reports income
to Employees on Form W-2.
In addition to other applicable limitations set forth in the Plan,
and notwithstanding any other provision of the Plan to the contrary, the
annual Compensation of each Employee taken into account under the Plan
shall not exceed the OBRA '93 annual compensation limit. The OBRA '93
annual compensation limit is $150,000, as adjusted by the Commissioner of
Internal Revenue for the cost-of-living in accordance with Section
401(a)(17)(B) of the Code. The cost-of-living adjustment in effect for
a calendar year applies to any period, not exceeding twelve (12) months,
over which Compensation is determined (determination period) beginning in
such calendar year. If a determination period consists of fewer than
twelve (12) months, the OBRA '93 annual compensation limit will be
multiplied by a fraction, the numerator of which is the number of months
in the determination period, and the denominator of which is 12. Any
reference in this Plan to the limitation under Section 401(a)(17) of the
Code shall mean the OBRA '93 annual compensation limit set forth in this
provision.
If Compensation for any prior determination period is taken into
account in determining an Employee's benefits accruing in the current Plan
Year, the Compensation for that prior determination period is subject to
the OBRA '93 annual compensation limit in effect for that prior
determination period. For this purpose, for determination periods
beginning before the first day of the first Plan Year beginning on or
after January 1, 1994, the OBRA '93 annual compensation limit is $150,000.
1.11. "Contributions" means amounts contributed to the Plan by the
Employer or an Eligible Employee. Specific types of contributions include:
(a) "Matching." An amount contributed by the
Employer based upon the amount contributed by
the eligible Participant.
(b) "Pre-Tax." An amount contributed on a pre-
tax basis in conjunction with a Participant's
Code Section 401(k) salary deferral agreement.
1.12. "Contribution Dollar Limit" means the annual limit imposed
on each Participant pursuant to Section 402(g) of the Code ($9,240 for the
1995 calendar year), as indexed for cost-of-living adjustments pursuant
to Code Section 402(g)(5) and 415(d).
1.13. "Contribution Election" or "Election" means the election
made by a Participant to reduce his or her Compensation by an amount equal
to the product of his or her Contribution Percentage and such Compensation
subject to the Contribution Election.
1.14. "Contribution Percentage" means the percentage of a
Participant's Compensation which is to be contributed to the Plan by his
or her Employer as a Contribution.
1.15. "Effective Date" means June 26, 1995, the date upon which
the provisions of this document become effective. In general, the
provisions of this document only apply to Participants who are Employees
on or after the Effective Date.
1.16. "Eligible Employee" means any Employee (including an
Employee on an Authorized Leave of Absence) of an Employer on and after
the Effective Date, who is a member of a group of Employees represented
by a collective bargaining representative, and covered by a currently
effective collective bargaining agreement between his or her Employer and
the collective bargaining representative which provides for coverage by
the Plan, excluding:
(a) Any person who is considered an Employee
solely because of the application of Section
414(n) of the Code; and
(b) Any person who is a nonresident alien who
receives no earned income, within the meaning
of Code Section 911(d)(2), from sources
within the United States of America within
the meaning of Code Section 861(a)(3).
Appendix A of the Plan lists the collective bargaining agreements and
their effective dates, that provide for coverage by the Plan.
1.17. "Employee" means any person who rendered services as a
common law employee to a Commonly Controlled Entity or is on an Authorized
Leave of Absence. Any individual considered an Employee of a Commonly
Controlled Entity under Section 414(n) of the Code shall be deemed
employed by the Commonly Controlled Entity for which the individual
performed services.
1.18. "Employer" means the Company and any Commonly Controlled
Entity that has adopted the Plan in accordance with Section 17.1;
provided, that an entity will cease to be an Employer when it ceases to
be a Commonly Controlled Entity.
1.19. "ERISA" means the Employee Retirement Income Security Act
of 1974, as amended. Reference to any specific section shall include such
section, any valid regulation promulgated thereunder, and any comparable
provision of any future legislation amending, supplementing or superseding
such section.
1.20. "Fair Market Value" means:
(a) with respect to a security for which there is
a generally recognized market, the price of
the security prevailing on a national
securities exchange which is registered under
Section 6 of the Securities Act of 1934;
(b) unless determined otherwise by the Company,
with respect to any guaranteed income
contract, the value reported by the issuing
company or bank; and
(c) for any other asset, the fair market value of
the asset, as determined in good faith by the
Trustee or the Company in accordance with
regulations promulgated under Section 3(18)
of ERISA.
1.21. "Family Member" shall mean an individual described in Code
Section 414(q)(6)(B).
1.22. "Highly Compensated Eligible Employee" or "HCE" means any
Employee who performs service for the Employer during the determination
year and who, during the look-back year: (i) received Compensation from
the Employers in excess of $75,000 (as adjusted pursuant to Section 415(d)
of the Code); (ii) received Compensation from the Employers in excess of
$50,000 (as adjusted pursuant to Section 415(d) of the Code) and was a
member of the top-paid group for such year; or (iii) was an officer of an
Employer and received Compensation during such year that is greater than
50 percent of the dollar limitation in effect under Section 415(b)(1)(A)
of the Code. The term highly compensated active employee also includes:
(i) Employees who are both described in the preceding sentence if the term
"determination year" is substituted for the term "look-back year" and the
Employee is one of the 100 Employees who received the most Compensation
from the Employer during the determination year; and (ii) Employees who
are 5-percent owners at any time during the look-back year or
determination year.
For this purpose, the determination year shall be the Plan Year.
The look-back year shall be the twelve-month period immediately preceding
the determination year. Pursuant to Code Section 414(q), the Company may
elect for the look-back year to be the calendar year ending with or within
the applicable Plan Year determination year.
If the Employer at all times during the Plan Year maintains
significant business activities (and employs Employees in such activities)
in at least two significantly separate geographic areas and satisfies such
other conditions as the Secretary of the Treasury may prescribe, the
Company may elect to apply a simplified definition of Highly Compensated
Employee under the Plan by substituting "$50,000" for "$75,000" in the
first sentence of this Section 1.22.
An Employee who performs services for the Employer any time during
the year is in the top-paid group of Employees for any year if such
Employee is in the group consisting of the top 20% of the Employees when
ranked on the basis of Compensation paid during such year. For purposes
of determining the number of Employees in the top-paid group (but not for
identifying the particular Employees in the top-paid group), certain
Employees may be excluded in accordance with Code Section 414(q)(8).
A highly compensated former employee includes any Employee who
separated from service (or was deemed to have separated) prior to the
determination year, performs no service for the Employer during the
determination year, and was a Highly Compensated Employee for either the
separation year or any determination year ending on or after the
Employee's 55th birthday.
1.23. "Internal Revenue Code" or "Code" means the Internal Revenue
Code of 1986, as amended, any subsequent Internal Revenue Code and final
Treasury Regulations. If there is a subsequent Internal Revenue Code, any
references herein to Internal Revenue Code sections shall be deemed to
refer to comparable sections of any subsequent Internal Revenue Code.
1.24. "Investment Election" means an election by which a
Participant directs the investment of his or her Contributions and
Rollover Contributions or changes the investment of his or her Account
Balances, by voice response to the telephone number provided by the Named
Fiduciary, or on such form that may be required by the Named Fiduciary.
No Investment Election shall be deemed to have been made unless it is
complete and delivered in accordance with the procedures established by
the Named Fiduciary for this purpose.
1.25. "Investment Fund" or "Fund" means one or more collective
investment funds, a pool of assets, or deposits with the Trustee, a mutual
fund, insurance contract, or managed pool of assets. The Investment Funds
authorized by the Company are listed in Appendix B.
1.26. "Named Fiduciary" means:
(a) with respect to the authority each has over
management and operation of the Plan's
administration and operation or discretionary
authority and control it may have with
respect to the Plan, the Company and such
other person who may be designated to be a
Named Fiduciary pursuant to Article XV;
(b) with respect to the management and control of
the Plan's assets or the discretionary
authority it may have with respect to the
Plan's assets, the Trustee, the Company, and
other such person who may be designated to be
a Named Fiduciary pursuant to Article XV.
1.27. "Non-Highly Compensated Employee" or "NHCE" means an
Employee who is neither an HCE nor a Family Member.
1.28. "Normal Retirement Date" means the date a Participant
becomes eligible for normal retirement under the Railroad Retirement Act.
1.29. "Participant" means an Eligible Employee who begins to
participate in the Plan after completing the eligibility requirements.
A Participant's participation continues until his or her Termination of
Employment and his or her Account Balance is distributed or forfeited.
1.30. "Payment Date" means the date on which a Participant's
Account Balance is distributed or commences to be distributed, which date
shall be at least the minimum number of days required by law, if any,
after the date the Participant has received any notice required by law,
if any. If a distribution is one to which Code Sections 401(a)(11) and
417 do not apply, such distribution may commence less than thirty (30)
days after the notice required under Section 1.411(a)-11(c) of the Income
Tax Regulations is given, provided that:
(a) the plan administrator clearly informs the
Participant that the Participant has a right
to a period of at least thirty (30) days
after receiving the notice to consider the
decision of whether or not to elect a
distribution (and, if applicable, a
particular distribution option), and
(b) the Participant, after receiving the notice,
affirmatively elects a distribution.
1.31. "Plan" means the Illinois Central Railroad Company Savings
Plan, as set forth herein and as hereafter may be amended from time to
time.
1.32. "Plan Year" means the annual accounting period of the Plan
and Trust which ends on each December 31.
1.33. "Pre-Tax Contributions" means the contributions elected by
a Participant pursuant to Section 3.1 of the Plan.
1.34. "QDRO" means a domestic relations order that the Company has
determined to be a qualified domestic relations order within the meaning
of Section 414(p) of the Code.
1.35. "Qualified Matching Contribution" means a Matching
Contribution that is treated as a Pre-Tax Contribution and posted to
Participants' Pre-Tax Accounts.
1.36. "Related Plan" means:
(a) with respect to Section 401(k) and 401(m) of
the Code, any plan or plans maintained by a
Commonly Controlled Entity which is treated
with this Plan as a single plan for purposes
of Sections 401(a)(4) or 410(b) of the Code;
and
(b) with respect to Section 415 of the Code, any
other defined contribution plan or a defined
benefit plan (as defined in Section 415(k) of
the Code) maintained by a Commonly Controlled
Entity, respectively called a "Related
Defined Contribution Plan" and a "Related
Defined Benefit Plan."
1.37. "Rollover Contribution" means a rollover contribution that
is an "eligible rollover distribution" as defined in Section 402(c) of the
Code (or its predecessor) attributable to an Eligible Employee.
1.38. "Spousal Consent" means the written consent given by a
Spouse to a Participant's election (or waiver) of a specified form of
benefit or Beneficiary designation. The Spouse's consent must acknowledge
the effect on the Spouse of the Participant's election, waiver or
designation and be duly witnessed by a Plan representative or notary
public. Spousal Consent shall be valid only with respect to the spouse
who signs the Spousal Consent. A Participant may revoke (without Spousal
Consent) a prior election, waiver or designation that required Spousal
Consent at any time before the date on which payments begin. Spousal
Consent also means a determination by the Company that there is no Spouse,
the Spouse cannot be located or such other circumstances as may be
established by applicable law.
1.39. "Spouse" means a person who, as of the earlier of a
Participant's Payment Date and death, is alive and married to the
Participant within the meaning of the laws of the State of the
Participant's residence as evidenced by a valid marriage certificate or
other proof acceptable to the Company. A spouse who was the Spouse on the
Payment Date but who is divorced from the Participant at the Participant's
death shall still be the Spouse at the date of the Participant's death,
except as otherwise provided in a QDRO.
1.40. "Termination of Employment" occurs on the date an Employee
quits, dies, retires, or is voluntarily or involuntarily discharged
without any rights or claim of reemployment under any collective
bargaining agreement; provided, that transfers of employment by an
Employee from the Company to any Commonly Controlled Entity or from one
Commonly Controlled Entity to another Commonly Controlled Entity or to the
Company shall not constitute a Termination of Employment for purposes of
the Plan.
1.41. "Trust" means the legal entity resulting from the agreement
between the Company and the Trustee and all amendments thereto, in which
some or all of the assets of this Plan will be received, held, invested
and distributed to or for the benefit of Participants and Beneficiaries.
1.42. "Trust Agreement" means the agreement between the Company
and the Trustee establishing the Trust, and any amendments thereto.
1.43. "Trust Fund" means any property, real or personal, received
by and held by the Trustee, plus all income and gains and minus all
losses, expenses, withdrawals and distributions chargeable thereto.
1.44. "Trustee" means any corporation, individual or individuals
designated in the Trust Agreement who shall accept the appointment as
Trustee to execute the duties of the Trustee as set forth in the Trust
Agreement.
1.45. "Valuation Date" means the close of business on each
business day.
ARTICLE II
PARTICIPATION
2.1. Eligibility. Each Eligible Employee shall become a
Participant in the Plan on the Effective Date, or on the first day of the
month coincident with or next following the date the Eligible Employee has
been continuously employed by the Employer for 30 days.
2.2. Reemployment.
(a) Eligible Employee Was Previously a
Participant. An Eligible Employee who
previously was a Participant prior to his or
her Termination of Employment shall become a
Participant on the first day he or she is
reemployed as an Eligible Employee.
(b) Eligible Employee Had a Termination. An
Eligible Employee who had a Termination of
Employment before he or she became a
Participant shall be eligible to become a
Participant on the later of: (i) the date he
or she would have become a Participant but
for his or her Termination of Employment, or
(ii) the date he or she is reemployed as an
Eligible Employee.
2.3. Participation Upon Change of Job Status. An Employee who
is not an Eligible Employee shall become a Participant on the later of:
(i) the date he or she would have become a Participant had he or she
always been an Eligible Employee, or (ii) the date he or she becomes an
Eligible Employee.
2.4. Uniformed Service. An Eligible Employee who had become an
active Participant in the Plan, and becomes reemployed by the Employer
after a period of "uniformed service," as that term is defined by the
Uniformed Services Employment and Reemployment Rights Act of 1994
("USERRA"), shall be deemed to have continued as an active Participant in
the Plan during the period of "uniformed service" to the extent required
by USERRA and regulations promulgated thereunder.
ARTICLE III
PARTICIPANT CONTRIBUTIONS
3.1. Pre-Tax Contribution Election. A Participant who is an
Eligible Employee may file a Contribution Election to have Pre-Tax
Contributions made on his or her behalf by his or her Employer, pursuant
to procedures specified by the Company. Such Contribution Election must
specify his or her Contribution Percentage of not less than two percent
(2.00%) nor more than fifteen percent (15%) (stated as a whole integer
percentage) and authorize the Compensation otherwise payable to him or her
to be reduced. A Participant's Contribution Election shall be effective
only with respect to Compensation not yet paid as of the date the
Contribution Election is effective. A Contribution Election shall become
effective with respect to the first payroll cycle beginning after the date
it is received by the Company. Any Contribution Election that has not been
properly completed will be deemed not to have been received and be void.
3.2. Election Procedures. A Participant's Contribution Election
shall continue in effect (with automatic adjustment for any change in his
or her Compensation) until the earliest of the date: (i) his or her
Contribution Election is changed in accordance with paragraph (a) below;
(ii) he or she ceases to be paid as an Eligible Employee; or (iii) his or
her Contribution Election is cancelled in accordance with paragraph (b)
below.
(a) Changing the Election. A Participant may
increase or decrease his or her Contribution
Percentage (subject to the percentage limits
stated above) only once in each calendar
quarter by making a new Contribution Election
on which is specified the amount of the
Contribution Percentage, pursuant to
procedures specified by the Company. The
change shall be effective with respect to the
first payroll cycle beginning after the date
the new Contribution Election is received,
unless an earlier date is specified by the
Company. The amount of increase or decrease
of such Contribution Percentage shall be
effective only with respect to Compensation
not yet paid.
(b) Canceling the Election. A Participant may
cancel his or her existing Contribution
Election and reduce his or her Contribution
Percentage to zero by making a new
Contribution Election, pursuant to procedures
specified by the Company. Such cancellation
shall become effective with respect to the
payroll cycle beginning after the day it is
received, unless an earlier date is specified
by the Company. A Participant who is an
Eligible Employee and who has cancelled his
or her Contribution Election may again make
a Contribution Election at the beginning of
any calendar quarter. Such Contribution
Election shall become effective with respect
to the first payroll cycle beginning after it
is received, provided at least three (3)
months have elapsed since the effective date
of the cancellation.
Any Participant who has improperly completed a Contribution Election will
be deemed not to have made an Election.
3.3. Limitation on Pre-Tax Contributions For All Participants.
A Participant's Pre-Tax Contributions for any calendar year shall not
exceed the Contribution Dollar Limit. If a Participant advises the
Company that he or she has Pre-Tax Contributions (reduced by Pre-Tax
Contributions previously distributed as a result of the application of
Code Section 401(k)(3) to such Participant) in excess of the Contribution
Dollar Limit ("Excess Deferral"), the Company shall return such Excess
Deferrals for the taxable year to the Participant. To the extent the
Participant's Pre-Tax Contributions exceed the Contribution Dollar Limit,
the Employer may notify the Plan on behalf of the Participant. If such
advice was received by the Company during the taxable year, the Plan shall
distribute the Excess Deferral as soon as administratively feasible. If
such advice was received by the Company after the taxable year but no
later than March 1 following the close of the taxable year, the Company
shall cause the Plan to return such Excess Deferral no later than April
15 immediately following the end of such taxable year, adjusted by income
allocable to that amount. The Plan may use any reasonable method for
computing the income allocable to Excess Deferrals. If the application
of the limitations in this Section results in a reduction of previously
contributed Pre-Tax Contributions on behalf of a Participant, Matching
Contributions allocable with respect thereto (prior to such reduction)
that are not distributed under the ACP Test shall be forfeited.
3.4. Post-Tax Contributions. Post-Tax Contributions will not be
permitted under the Plan, except to the extent that Pre-Tax Contributions
are recharacterized as such, in accordance with Section 13.4.
ARTICLE IV
EMPLOYER CONTRIBUTIONS AND ALLOCATIONS
4.1. Pre-Tax Contributions. Subject to the limits of the Plan
and to the Company's authority to limit Contributions under the terms of
this Plan, for each period for which a Contribution Election is in effect,
the Employer shall contribute to the Plan on behalf of each Participant
an amount equal to the amount designated by the Participant as a Pre-Tax
Contribution on his or her Contribution Election. The Pre-Tax
Contribution shall be allocated to the Pre-Tax Account of the Participant
with respect to whom the amount is paid. Pre-Tax Contributions shall be
paid to the Trustee in cash and posted to each Participant's Pre-Tax
Account as soon as practicable, but not more than ninety (90) days after
the date amounts are deducted from the Participant's Compensation.
4.2. Matching Contributions. Subject to the limits of the Plan
and to the Company's authority to limit Contributions under the Plan, for
each period for which Participants' Contributions are made, the Employer
shall make Matching Contributions on behalf of each Participant who made
a Pre-Tax Contribution during the period in an amount equal to twenty-five
percent (25%) of such Participant's Pre-Tax Contributions for the period,
provided that no Matching Contributions shall be made based upon a
Participant's Pre-Tax Contributions in excess of four percent (4%) of his
or her Compensation. The Employer shall make each period's Matching
Contribution in cash or stock as soon as practicable after the end of such
period, but not later than the Employer's federal tax filing date,
including extensions, for deducting such Contribution. The Company shall
post such amount to each Participant's Matching Account once the total
Contribution received by the Trustee has been balanced against the
specific amount to be credited to each Participant's Matching Account.
Compensation shall be measured by the period (not to exceed the Plan Year)
for which the Contribution is being made provided the Eligible Employee
is a Participant during such period.
4.3. Miscellaneous. In no event shall the Employer Contributions
for a Plan Year exceed the maximum the Company estimates will be
deductible (or would be deductible if the Employers had taxable income)
by any Employer or Commonly Controlled Entity under Section 404 of the
Code ("Deductible Amount"). Notwithstanding anything herein to the
contrary, the Plan shall constitute a profit sharing plan for all purposes
of the Code.
ARTICLE V
ROLLOVERS
5.1. Rollovers to the Plan. The Company may authorize the
Trustee to accept a Rollover Contribution from an Eligible Employee in
cash, even if he or she is not yet a Participant. The Employee shall
furnish satisfactory evidence to the Company that the amount is eligible
for rollover treatment. Such amount shall be posted to the Employee's
Rollover Account by the Company as of the date received by the Trustee.
If it is later determined that an amount transferred pursuant to the
above paragraph did not in fact qualify as a Rollover Contribution, the
balance credited to the Employee's Rollover Account immediately shall be:
(i) segregated from all other Plan assets; (ii) treated as a non-qualified
trust established by and for the benefit of the Employee; and (iii)
distributed to the Employee. Any such nonqualifying rollover shall be
deemed never to have been a part of the Plan.
5.2. Rollovers From The Plan. Notwithstanding any provision of
the Plan to the contrary that would otherwise limit a Distributee's
election under this Plan, a Distributee may elect, at the time and in the
manner prescribed by the Company, to have any portion of an Eligible
Rollover Distribution paid directly to an Eligible Retirement Plan
specified by the Distributee in a Direct Rollover.
(a) "Eligible Rollover Distribution" is any
distribution of all or any portion of the
balance to the credit of the Distributee,
except that an Eligible Rollover Distribution
does not include: any distribution that is
one of a series of substantially equal
periodic payments (not less frequently than
annually) made for the life (or life
expectancy) of the Distributee or the joint
lives (or joint life expectancies) of the
Distributee and the Distributee's designated
Beneficiary, or for a specified period of ten
years or more; any distribution to the extent
such distribution is required under Section
401(a)(9) of the Code; and the portion of any
distribution that is not includible in gross
income (determined without regard to the
exclusion for net unrealized appreciation
with respect to employer securities).
(b) "Eligible Retirement Plan" is an individual
retirement account described in Section
408(a) of the Code, an individual retirement
annuity described in Section 408(b) of the
Code, an annuity plan described in Section
403(a) of the Code, or a qualified trust
described in Section 401(a) of the Code, that
accepts the Distributee's eligible rollover
distribution. However, in the case of an
Eligible Rollover Distribution to the
Surviving Spouse, an Eligible Retirement Plan
is an individual retirement account or
individual retirement annuity.
(c) "Distributee" includes an Employee or former
Employee. In addition, the Employee's or
former Employee's Surviving Spouse and the
Employee's or former Employee's spouse or
former spouse who is the alternate payee
under a qualified domestic relations order,
as defined in Section 414(p) of the Code, are
Distributees with regard to the interest of
the spouse or former spouse.
(d) "Direct Rollover" is a payment by the Plan to
the Eligible Retirement Plan specified by the
Distributee.
If a distribution is one to which Sections 401(a)(11) and 417 of the Code
do not apply, such distribution may commence less than 30 days after the
notice required under Section 1.411(a)-11(c) of the Income Tax Regulations
is given, provided that: (i) the Company clearly informs the Participant
that the Participant has a right to a period of at least 30 days after
receiving the notice to consider the decision of whether or not to elect
a distribution (and, if applicable, a particular distribution option); and
(ii) the Participant, after receiving the notice, affirmatively elects a
distribution.
ARTICLE VI
ACCOUNTING FOR PARTICIPANTS'
ACCOUNTS AND FOR INVESTMENT FUNDS
6.1. Individual Participant Accounting. The Company shall cause
the Accounts for each Participant to reflect transactions involving assets
of the Accounts in accordance with this Article. Financial transactions
during or with respect to an Accounting Period shall be accounted for at
the individual Account level by "posting" each transaction to the
appropriate Account of each affected Participant. Participant Account
values shall be maintained in shares. At any point in time, the value of
a Participant's Account Balance shall be equal to the net Fair Market
Value of his or her Account as of that date.
(a) Fees and Expenses. Account maintenance fees
shall be charged pro rata to each
Participant's Account on the basis of each
Participant's Account Balance, provided that
no fee shall reduce a Participant's Account
Balance below zero. Transaction type fees
(such as special asset fees, Investment
Election change fees, etc.) shall be charged
to the Accounts involved in the transaction.
(b) Error Correction. The Company may correct
any errors or omissions in the administration
of the Plan by restoring or charging any
Participant's Account Balance with the amount
that would be credited or charged to the
Account had no error or omission been made.
Funds necessary for any such restoration shall
be provided through payment made by the Company.
6.2. Accounting for Investment Funds. The investments in each
Investment Fund designated in Appendix B, including the Illinois Central
Stock Fund, shall be maintained in full and fractional shares or units.
The Trustee is responsible for determining the number of full and
fractional shares or units of each such Fund. To the extent an Investment
Fund is comprised of a collective investment fund of the Trustee, the net
asset and unit values shall be determined in accordance with the rules
governing such collective investment funds, which are incorporated herein
by reference. Fees and expenses incurred for the management and
maintenance of Investment Funds shall be charged at the Investment Fund
level and reflected in the net gain or loss of each Fund.
6.3. Accounting for Company Stock. The following additional
rules shall apply to the Illinois Central Stock Fund:
(a) Shareholder Rights. Shareholder Rights with
respect to all Company Stock in an Account
shall be exercised by the Trustee in
accordance with directions from the
Participant pursuant to the procedures of the
Trust Agreement.
(b) Tender Offer. If a tender offer is commenced
for Company Stock, the provisions of the
Trust Agreement regarding the response to
such tender offer, the holding and investment
of proceeds derived from such tender offer
and the substitution of new securities for
such proceeds shall be followed.
(c) Dividends and Income. Dividends (whether in
cash or in property) and other income
received by the Trustee in respect of Company
Stock shall be reinvested in Company Stock
and shall constitute income and be recognized
on an accrual basis for the Accounting Period
in which occurs the record date with respect
to such dividend; provided that, with respect
to any dividend that is reflected in the
market price of the underlying stock, the
Company shall direct the Trustee during such
trading period to trade such stock the
regular way to reflect the value of the
dividend, and all Fund transfers and cash
distributions shall be transacted accordingly
with no accrual of such dividend, other than
as reflected in such market price.
(d) Transaction Costs. Any brokerage
commissions, transfer taxes, transaction
charges, and other charges and expenses in
connection with the purchase or sale of
Company Stock shall be added to the cost
thereof in the case of a purchase or deducted
from the proceeds thereof in the case of a
sale; provided, however, where the purchase
or sale of Company Stock is with a
"disqualified person" as defined in Section
4975(e)(2) of the Code or a "party in
interest" as defined in Section 3(14) of
ERISA, no commissions may be charged with
respect thereto.
ARTICLE VII
INVESTMENT FUNDS AND ELECTIONS
7.1. Investment Funds. The Company shall direct the Trustee to
maintain various Investment Funds. The Company may change the number or
composition of the Investment Funds, subject to the terms and conditions
agreed to with the Trustee.
7.2. Investment of Contributions.
(a) Investment Election. Each Participant may
make an Investment Election to invest the
Contributions posted to his or her Accounts
in whole multiples of one percent (1%) in one
or more Investment Funds. If a Participant
does not make a valid Investment Election,
his or her Investment Election shall be
deemed to be a 100% election of the
Investment Fund designated by the Company as
the default option, as indicated in Appendix B.
(b) Effective Date of Investment Election; Change
of Investment Election. A Participant's
initial Investment Election and any change in
such Investment Election will be effective
with respect to a Fund on the business day
following the day on which the Investment
Election is received pursuant to procedures
specified by the Company. A Participant's
Investment Election shall continue in effect,
notwithstanding any change in his or her
Compensation or his or her Contribution
Percentage, until the earliest of: (i) the
effective date of a new Investment Election;
or (ii) the date he or she ceases to be paid
as an Eligible Employee. A Participant may
change his or her Investment Election as to
future Contributions only once in any
calendar quarter.
7.3. Investment of Accounts. If the Participant or Beneficiary
elects to invest, or change investment of, his or her Account Balance in
more than one (1) Investment Fund, he or she must designate in whole
multiples of one percent (1%) what percentage of his or her Accounts is
to be invested in each Investment Fund. A Participant or Beneficiary may
make an Investment Election to change the allocation of his or her Account
Balance among the Investment Funds once in any calendar quarter. An
Investment Election to change a Participant's or Beneficiary's investment
of his or her Account Balance in one Investment Fund to another Fund shall
be effective at the end of the business day following the day on which the
Election is received pursuant to procedures specified by the Company.
Notwithstanding the foregoing, to the extent required by any provisions
of an Investment Fund, or such other circumstances as the Company may
determine, the effective date of any Investment Election may be delayed
or the amount of any permissible Investment Election may be reduced.
7.4. Establishment of Investment Funds. The Company shall cause
to be established one or more Investment Funds set forth in Appendix B.
In addition, the Company may, from time to time, in its discretion:
(a) limit investments in or transfers from an
Investment Fund;
(b) add funding vehicles thereunder;
(c) liquidate, consolidate or otherwise
reorganize an existing Investment Fund; or
(d) add a new Investment Fund to the Appendix.
7.5. Transition Rules. Effective as of the date any Investment
Fund is added or deleted, each Participant and Beneficiary shall have the
opportunity to make new Investment Elections. The Company and Trustee may
use any reasonable accounting methods in performing their respective
duties during the period of transition from one Investment Fund to
another, including, but not limited to:
(a) designating into which Investment Fund a
Participant's Account Balance will be
invested if the Participant fails to submit
a proper Investment Election;
(b) the method for allocating net investment
gains or losses and the extent, if any, to
which amounts received by and distributions
paid from the Trust during this period share
in such allocation; and
(c) investing all or a portion of the Trust's
assets in a short-term, interest-bearing Fund
during such transition period.
ARTICLE VIII
VESTING
8.1. Fully Vested Contribution Accounts. A Participant shall be
fully vested and have a nonforfeitable right to his or her Account
Balances at all times.
ARTICLE IX
IN-SERVICE WITHDRAWALS
9.1. Withdrawals for 401(k) Hardship. A Participant may request
the withdrawal of an amount from his or her Pre-Tax Account needed to
satisfy a financial need by making a withdrawal request in accordance with
a procedure established by the Company. The Company shall only approve
those requests for withdrawals (1) on account of a Participant's "Deemed
Financial Need," and (2) which is "Deemed Necessary" to satisfy the
financial need.
(a) "Deemed Financial Need." Financial commitments relating to:
(i) costs directly related to the purchase or
construction (excluding mortgage payments or
balloon payments) of a Participant's principal
residence;
(ii) the payment of expenses for medical care
described in Section 213(d) of the Code
previously incurred by the Participant, the
Participant's Spouse, or any dependents of the
Participant (as defined in Section 152 of the
Code) or necessary for those persons to obtain
medical care described in Section 213(d) of the
Code;
(iii) payment of tuition, related educational
fees, and room and board expenses, for the next
twelve (12) months of post-secondary education
for the Participant, his or her Spouse, children
or dependents (as defined in Section 152
of the Code); or
(iv) necessary payments to prevent the eviction of
the Participant from his or her principal
residence or the foreclosure on the mortgage
of the Participant's principal residence.
(b) "Deemed Necessary." A withdrawal is "deemed
necessary" to satisfy the financial need only
if all of these conditions are met:
(i) the withdrawal may not exceed the dollar amount
needed to satisfy the Participant's Deemed
Financial Need, plus an amount necessary to pay
federal, state, or local income taxes or
penalties reasonably anticipated to result
from such withdrawal;
(ii) the Participant must have obtained all
distributions, other than financial hardship
distributions, and all nontaxable loans under
all plans maintained by the Company or any
Commonly Controlled Entity;
(iii) the Participant will be suspended from making
Pre-Tax Contributions (or similar
contributions under any other qualified or
nonqualified plan of deferred compensation
maintained by a Commonly Controlled Entity) for
at least twelve (12) months from the date the
withdrawal is received;
and
(iv) the Contribution Dollar Limit for the taxable
year immediately following the taxable
year in which the financial hardship
withdrawal is received shall be reduced by the
Pre-Tax Contributions for the taxable year in
which the financial hardship withdrawal is
received.
(d) Contribution Account Sources for Withdrawal.
All available amounts first must be withdrawn
from a Participant's Post-Tax Account, if
any. The remaining withdrawal amount shall
come only from his or her Pre-Tax Account.
The amount that may be withdrawn from a
Participant's Pre-Tax Account shall not
include earnings and Qualified Matching
Contributions.
9.2. Withdrawals for Participants Over Age 59.5. A Participant
who is over age 59.5 may withdraw from the vested portion of his or her
Accounts. When requesting a withdrawal, a Participant shall have amounts
taken from each of his or her Rollover Account, Pre-Tax Account, Matching
Account and Post-Tax Account, if any, on a pro rata basis.
9.3. Withdrawals for General Hardship. A Participant may request
the withdrawal of an amount from his or her Contribution Accounts listed
below that is needed to satisfy a general hardship. General hardship
means circumstances of sufficient severity that a Participant is
confronted by current or impending financial ruin or his or her family is
clearly endangered by current or impending want or privation. When
requesting a withdrawal for general hardship, a Participant shall first
have amounts taken from his or her Accounts in the following priority
order: (i) Post-Tax Contributions Account, if any; (ii) Rollover Account;
and (iii) Matching Account.
9.4. Withdrawal Rules.
(a) Minimum Amount. There is no minimum payment
for any type of withdrawal.
(b) Permitted Frequency. A Participant may make
only one withdrawal under this Article during
each calendar year.
(c) Application by Participant. A Participant
must submit a withdrawal request in
accordance with a procedure established by
the Company to the responsible Named
Fiduciary to apply for any type of
withdrawal. Only a Participant who is an
Employee may make a withdrawal request.
(d) Approval by Company. The responsible Named
Fiduciary is responsible for determining that
a withdrawal request conforms to the
requirements described in this Article and
notifying the Trustee of any payments to be
made in a timely manner.
(e) Medium and Form of Payment. The medium of
payment for withdrawals is either cash or
direct deposit. The form of payment for
withdrawals shall be a single installment.
(f) Investment Fund Sources. Within each Account
used for funding a withdrawal, amounts shall
be taken by type of investment in direct
proportion to the market value of the
Participant's interest in each Investment
Fund at the time the withdrawal is made.
ARTICLE X
DISTRIBUTIONS ON AND AFTER
TERMINATION OF EMPLOYMENT
10.1. Request for Distribution of Benefits. Subject to the other
requirements of this Article, a Participant may elect to have his or her
Account Balance paid to him or her beginning upon any Payment Date
following his or her Termination of Employment by submitting a completed
distribution election in accordance with a procedure established by the
Company. The election must be submitted to the Company within a
reasonable time prior to the Payment Date. The Company shall provide the
Participant with information regarding all optional times and forms of
payment available.
If a Participant has a Termination of Employment and fails to submit
a distribution request in accordance with the procedure established by the
Company by the last Payment Date permitted under this Article, his or her
Account Balances shall be valued as of the Valuation Date that immediately
precedes such latest date of distribution (called the "Default Valuation
Date") and a notice of such deemed distribution shall be issued to his or
her last known address as soon as administratively possible. If the
Participant does not respond to the notice or cannot be located, his or
her Account Balance determined on the Default Valuation Date shall be
forfeited. If the Participant subsequently files a claim, the amount
forfeited (unadjusted for gains and losses) shall be reinstated to his or
her Accounts and distributed as soon as administratively feasible. The
amount necessary to reinstate a Participant's Account in this manner shall
come from other forfeitures or by a contribution from the Employer of the
affected Participant.
10.2. Deadline for Distribution. In addition to any other Plan
requirements and unless the Participant elects otherwise, or cannot be
located, the Payment Date of a Participant's Account Balance shall be not
later than sixty (60) days after the latest of the close of the Plan Year
in which: (i) the Participant attains the earlier of age sixty-five (65)
or his or her Normal Retirement Date; (ii) occurs the tenth (10th)
anniversary of the Plan Year in which the Participant commenced
participation; or (iii) the Participant had a Termination of Employment.
However, if the amount of the payment or the location of the Participant
(after a reasonable search) cannot be ascertained by that deadline,
payment shall be made no later than sixty (60) days after the earliest
date on which such amount or location is ascertained. In any case, the
Payment Date of a Participant's Account Balance shall not be later than
April 1 following the calendar year in which the Participant attains age
seventy and one-half (70.5) years and each December 31 thereafter, and
shall comply with the requirements of Section 401(a)(9) of the Code and
the Treasury Regulations promulgated thereunder.
10.3. Payment Form and Medium. A Participant's Account Balance
shall be paid in the form of a single lump sum cash payment (generally by
check).
10.4. Small Amounts Paid Immediately. If a Participant has a
Termination of Employment and the Participant's Account Balance is $3,500
or less, the Participant's Account Balance shall be paid as soon as
administratively feasible after his or her Termination of Employment.
ARTICLE XI
DISTRIBUTION OF ACCOUNT BALANCES ON DEATH
11.1. Payment to Beneficiary. On the death of a Participant prior
to his or her Payment Date, his or her Account Balance shall be paid to
the Beneficiary or Beneficiaries designated by the Participant in
accordance with the procedure established by the Company. Death of a
Participant on or after his or her Payment Date shall result in payment
to his or her Beneficiary of whatever amount is remaining in the
Participant's Accounts.
11.2. Beneficiary Designation. Each Participant shall complete
a beneficiary designation indicating the Beneficiary who is to receive the
Participant's remaining Account Balance at the time of his or her death.
The Participant may change such designation of Beneficiary from time to
time by filing a new beneficiary designation with the Company. No
designation of Beneficiary or change of Beneficiary shall be effective
until properly filed with the Company. Notwithstanding any designation
to the contrary, the Participant's Beneficiary shall be the Participant's
Spouse to whom the Participant is legally married under the laws of the
State of the Participant's residence on the date of the Participant's
death and surviving him or her on such date, unless such designation
includes Spousal Consent. If the Participant dies leaving no Spouse and
either (i) the Participant shall have failed to file a valid beneficiary
designation, or (ii) all persons designated on the beneficiary designation
shall have predeceased the Participant, such Participant's Account Balance
shall be distributed in a single sum to his or her estate.
11.3. Benefit Election. In the event of a Participant's death,
the Account Balance of the deceased Participant shall be paid to the
Beneficiary as soon as practicable after the Participant's death in a
single lump sum cash payment (by check). The Beneficiary may elect to
have the Account Balance of the deceased Participant paid to him or her
beginning upon a Payment Date following the Participant's date of death
by submitting a completed distribution election in accordance with the
procedure established by the Company. The election must be submitted to
the Company within a reasonable time prior to the Payment Date. In the
event a Beneficiary fails to submit a timely distribution request, his or
her Account Balance shall be valued as of the Default Valuation Date and
a notice of such deemed distribution shall be issued to his or her last
known address as soon as administratively possible. If the Beneficiary
does not respond to the notice or cannot be located, his or her Account
Balance determined on the Default Valuation Date shall be forfeited. If
the Beneficiary subsequently files a claim, the amount forfeited
(unadjusted for gains and losses) shall be reinstated to his or her
Accounts and distributed as soon as administratively feasible. The amount
necessary to reinstate a Participant's Accounts in this manner shall come
from other forfeitures or by a contribution from the Employer of the
affected Participant.
ARTICLE XII
MAXIMUM CONTRIBUTIONS
12.1. Maximum Annual Additions. Notwithstanding any other
provision of this Plan, a Participant's "Annual Additions" for any Plan
Year, which is hereby designated as the "limitation year" for the Plan,
as that term is used in Section 415 of the Code, shall not exceed his or
her "Maximum Annual Additions." If at any time during a Plan Year, the
allocation of additional Contributions for a Plan Year would produce an
Annual Excess, the affected Participant shall receive the Maximum Annual
Addition from Contributions, and, at the direction of the Company, for the
remainder of the Plan Year Contributions will be reduced to the extent
necessary to prevent the affected Participant from exceeding the Maximum
Annual Addition.
(a) "Annual Additions" means with respect to a
Participant for any Plan Year the sum of: (i)
Contributions (and any earnings thereon)
allocated as of a date within the Plan Year;
(ii) all contributions, forfeitures and
suspended amounts (and income thereon) for
such Plan Year, allocated to such
Participant's account(s) under any Related
Defined Contribution Plan as of a date within
such Plan Year; (iii) the sum of all
after-tax contributions of the Participant to
Related Plans for the Plan Year and allocated
to such Participant's accounts under such
Related Plan as of a date within such Plan
Year ("Aggregate Employee Contributions");
(iv) solely for purposes of this Section, all
contributions to any "separate account" (as
defined in Section 419A(d) of the Code)
allocated to such Participant as of a date
within the Plan Year if such Participant is
a "Key Employee" within the meaning of Code
Section 416(i); and (v) solely for purposes
of this Section, all contributions to any
"individual medical benefit account" (as
defined in Section 415(1) of the Code)
allocated to such Participant as of a date
within the Plan Year.
(b) "Maximum Annual Additions" of a Participant
for a Plan Year means the lesser of: (i)
twenty-five percent (25%) of the
Participant's Compensation, or (ii) the
greater of thirty thousand dollars ($30,000)
or one-quarter of the dollar limitation in
Code Section 415(b)(1)(A) as adjusted for
cost of living increases (determined in
accordance with regulations prescribed by the
Secretary of the Treasury or his or her
delegate pursuant to the provisions of
Section 415(d) of the Code).
(c) "Annual Excess" means, for each Participant
affected, the amount by which the allocable
Annual Additions for such Participant exceeds
or would exceed the Maximum Annual Addition
for such Participant.
12.2. Correcting an Annual Excess. If for any Plan Year as a
result of a reasonable error in estimating a person's Compensation, Pre-
Tax Contributions, or such other facts and circumstances that the Internal
Revenue Service will permit, a Participant receives an Annual Excess, such
Annual Excess shall be treated in the following manner:
(a) Any after-tax employee contributions
allocable under a Related Plan shall be
distributed to the Participant, if permitted,
in the amount of the Annual Excess.
(b) if any Annual Excess remains, Pre-Tax
Contributions shall be distributed to such
Participant from this Plan.
Except as provided in (a) above, the Annual Excess shall be corrected by
reducing the Annual Addition to this Plan before reductions have been made
to other Related Defined Contribution Plans.
12.3. Two-Plan Limit. If a Participant participates in any Related
Defined Benefit Plan, the sum of the "Defined Benefit Plan Fraction" (as
defined below) and the "Defined Contribution Plan Fraction" (as defined
below) for such Participant shall not exceed one (called the "Combined
Fraction").
(a) "Defined Benefit Plan Fraction" means, for
any Plan Year, a fraction, the numerator of
which is the projected benefit payable
pursuant to Code Section 415(e)(2)(A) under
all Related Defined Benefit Plans and the
denominator of which is the lesser of: (i)
the product of 1.25 and the dollar limit in
effect for the Plan Year under Code Section
415(b)(1)(A), and (ii) the product of 1.4 and
one hundred percent (100%) of the
Participant's average Compensation for his or
her high three (3) years.
(b) "Defined Contribution Plan Fraction" means,
for any Plan Year, a fraction, the numerator
of which is the sum of the Annual Additions
(as determined pursuant to Section 415(c) of
the Code in effect for such Plan Year) to a
Participant's Accounts as of the end of the
Plan Year under the Plan or any Related
Defined Contribution Plan, and the
denominator of which is the lesser of:
(i) The sum of the products of 1.25 and the dollar
limit under Code Section 415(c)(1)(A) for such
Plan Year and for each prior year of service
with a Commonly Controlled Entity and
its predecessor, and
(ii) the sum of the products of 1.4 and twenty-five
percent (25%) of the Participant's
Compensation for such Plan Year and for each
prior year of service with a Commonly
Controlled Entity and its predecessor.
If the Combined Fraction of such Participant exceeds one and if the
Related Defined Benefit Plan permits it, the Participant's Defined Benefit
Plan Fraction shall be reduced by limiting the Participant's annual
benefits payable from the Related Defined Benefit Plan in which he or she
participates to the extent necessary to reduce the Combined Fraction of
such Participant to one.
12.4. Short Plan Year. With respect to any change of the Plan
Year (and co-existent limitation year), the dollar limitation of the
Maximum Annual Addition for such Plan Year shall be determined by
multiplying such dollar amount by a fraction, the numerator of which is
the number of months (including fractional parts of a month) in the short
Plan Year, and the denominator of which is twelve (12).
ARTICLE XIII
ADP AND ACP TESTS
13.1. Contribution Limitation Definitions. For purposes of this
Article, the following terms are defined as follows:
(a) "Average Contribution Percentage" or "ACP"
means, separately, the average of the
Calculated Percentage for Participants within
the HCE Group and the NHCE Group,
respectively, for a Plan Year.
(b) "Average Deferral Percentage" or "ADP" means,
separately, the average of the Calculated
Percentage calculated for Participants within
the HCE Group and the NHCE Group,
respectively, for a Plan Year.
(c) "Calculated Percentage" means, with respect
to each Participant: (i) the K-Contributions
(including amounts distributed because they
exceeded the Contribution Dollar Limit) with
respect to Compensation that would have been
received by the Participant in the Plan Year
but for his or her Pre-Tax Contribution
Election; and (ii) the M-Contributions
allocated to the Participant's Account as of
a date within the Plan Year, divided by his
or her Compensation for such Plan Year.
(d) "M-Contributions" shall include Matching
Contributions (excluding Qualified Matching
Contributions), and Pre-Tax Contributions, if
any, that are recharacterized as Post-Tax
Contributions. In addition, M-Contributions
may include Pre-Tax Contributions, but only
to the extent that (i) the Company elects to
use them; and (ii) they meet the requirements
of Code Section 401(m) to be regarded as
Matching Contributions. M-Contributions
shall not include Matching Contributions that
are forfeited because the Contribution to
which it relates is in excess of the ADP
Test, ACP Test or the Contribution Dollar
Limit.
(e) "K-Contributions" shall include Pre-Tax
Contributions (excluding Pre-Tax
Contributions treated as Matching
Contributions), but shall exclude such Pre-
Tax Contributions to this Plan made on behalf
of any NHCE in excess of the Contribution
Dollar Limit. K-Contributions also may
include Qualified Matching Contributions, but
only to the extent that (i) the Company
elects to use them and (ii) they meet the
requirements of Code Section 401(k) to be
regarded as elective contributions.
(f) "HCE Group" and "NHCE Group" means, with
respect to each Employer and its Commonly
Controlled Entities, the respective group of
HCEs and NHCEs who are eligible to have
amounts contributed on their behalf for the
Plan Year, including Employees who would be
eligible but for their election not to
participate or to contribute, but subject to
the following:
(i) If the Related Plans are subject to the ADP or
ACP Test, and are considered as one plan
for purposes of Code Sections 401(a)(4) or
410(b) (other than 410(b)(2)), all such
plans shall be aggregated and treated
as one plan for purposes of meeting the ADP and
ACP Tests provided that plans may only be
aggregated if they have the same Plan Year.
(ii) If an HCE who is a five-percent owner
(within the meaning of Code Section 416) or one
of the ten HCE most highly compensated
during the Plan Year has any Family Members, the
K-Contributions, M-Contributions and
Compensation of such HCE and his or her Family
Members shall be combined and treated as
a single HCE. In addition, such amounts
for all other Family Members shall be removed
from the NHCE Group percentage calculation.
(iii) If an HCE is covered by more than one cash or
deferred arrangement maintained by the
Related Plans, all such arrangements (other than
arrangements in plans that are not required to
be aggregated for this purpose under Treas.
Reg. Sect 1.401(k)-1(g)(l)(ii)(B)) with respect to the
Plan Years ending with or within the same
calendar year shall be aggregated and treated
as one arrangement for purposes of calculating
the separate percentage for the HCE which is
used in the determination of the Average Percentage.
13.2. Collectively Bargained Employees. The provisions of this
Article shall apply separately to Participants: (i) who are collectively
bargained employees within the meaning of Treas. Reg. Sect 1.410(b)-6(d)(2)
and for Participants who are not collectively bargained employees; and
(ii) who are members of different collective bargaining units in
accordance with Treas. Reg. Sect 1.401(k)-1(g)(11)(A).
13.3. ADP and ACP Tests. For each Plan Year, the ADP and ACP for
the HCE Group must meet either the Basic or Alternative Limitation when
compared to the respective ADP and ACP for the NHCE Group:
(a) Basic Limitation. The ADP or ACP for the HCE
Group may not exceed 1.25 times the ADP or
ACP, respectively, for the NHCE Group.
(b) Alternative Limitation. The ADP or ACP for
the HCE Group is limited by reference to the
ADP or ACP, respectively, for the NHCE Group
as follows:
If the NHCE Group Then The Maximum HCE
Percentage is: Group Percentage is:
Less than 2% 2 times ADP or ACP for the NHCE Group
2% to 8% ADP or ACP for the NHCE Group plus 2%
More than 8% Basic Limitation applies
13.4. Correction of ADP and ACP Tests.
(a) Reduction of K-Contributions or
M-Contributions. If the ADP or ACP are not
met or will not be met, the Company shall
determine a maximum percentage to be used in
place of the Calculated Percentage for each
HCE that would reduce the ADP or ACP of the
HCE Group by a sufficient amount to meet the
ADP and ACP Tests. For any HCE Group who has
a Family Member, the reduction amount shall
be prorated among Family Members as provided
in Code Sections 401(k) and (m).
(b) ADP Correction. Pre-Tax Contributions
(including amounts previously refunded
because they exceeded the Contribution Dollar
Limit) shall be recharacterized by allocating
an amount equal to the actual K-Contribution
minus the product of the maximum percentage
for that HCE and the HCE's Compensation to a
Participant's newly created Post-Tax Account
within two and one-half months after the
close of the Plan Year. Matching
Contributions with respect to such
distributed Pre-Tax Contributions shall be
forfeited (unless paid to the Participant due
to an ACP Correction).
(c) ACP Correction. Matching Contribution
amounts in excess of the Maximum Percentage
of an HCE's Compensation shall, by the end of
the next Plan Year, be refunded to the
Participant.
(d) Investment Fund Sources. Once the amount of
Pre-Tax and/or Matching Contributions to be
refunded is determined, amounts shall then be
taken by type of investment in direct
proportion to the market value of the
Participant's interest in each Investment
Fund as of the date as of which the
correction is processed.
(e) Family Member Correction. To the extent any
reduction is necessary with respect to an HCE
and his or her Family Members that have been
combined and treated for testing purposes as
a single Employee, the excess K-Contributions
and/or M-Contributions from the ADP and/or
ACP Test shall be prorated among each such
Participant in direct proportion to his or
her K-Contributions and/or M-Contributions
included in each test.
13.5. Method of Calculation. The Company shall determine the
Maximum Percentage for each HCE whose Calculated Percentage(s) is(are) the
highest at any one time by reducing his or her Calculated Percentage in
the following manner until the ADP and/or ACP Test is satisfied:
(a) The Calculated Percentage for each HCE under
a Related Plan shall be reduced to the extent
permitted under such Related Plan.
(b) If more reduction is needed, the Calculated
Percentage of each HCE whose Calculated
Percentage (stated in absolute terms) is the
greatest shall be reduced by one-hundredth
(1/100) of one percentage point.
(c) If more reduction is needed, the Calculated
Percentage of each HCE whose Calculated
Percentage (stated in absolute terms) is the
greatest (including the Calculated Percentage
of any HCE whose Calculated Percentage was
adjusted under Paragraph (b) shall be reduced
by one-hundredth (1/100) of one percentage
point.
(d) If more reduction is needed, the procedures
of Paragraph (c) shall be repeated.
13.6. Multiple Use Test. If the Average Contribution Percentage
and the Average Deferral Percentage for the HCE Group exceeds the Basic
Limitation in both the ADP or the ACP Tests (after correction of the ADP
and ACP Test), the ADP and ACP (as corrected) for the HCE Group must also
comply with the requirements of Code Section 401(m)(9), which as of the
Effective Date require that the sum of these two percentages (as
determined after any corrections needed to meet the ADP or ACP Tests have
been made) must not exceed the greater of:
(a) the sum of: (i) the larger of the ADP or ACP
for the NHCE Group times 1.25; and (ii) the
smaller of the ADP or ACP for the NHCE Group,
times two (2) if the NHCE Average Percentage
is less than two percent (2%), or plus two
percent (2%) if it is two percent (2%) or
more; or
(b) the sum of: (i) the lesser of the ADP or ACP
for the NHCE Group times 1.25; and (ii) the
greater of the ADP or ACP for the NHCE Group,
times two (2) if the NHCE Average Percentage
is less than two percent (2%), or plus two
percent (2%) if it is two percent (2%) or more.
If the multiple use limit is exceeded, the Company shall determine
a maximum ADP or ACP for the HCE Group and shall reduce the ADP or ACP for
each HCE in the same manner as would be used to correct to ADP or ACP.
13.7. Adjustment for Investment Gain or Loss. The net investment
gain or loss associated with the K-Contributions and/or M-Contributions
to be distributed shall be distributed or charged against a distribution
within two and one-half (2.5) months but no later than twelve (12) months
following the close of the applicable Plan Year. Such gain or loss shall
be computed according to a reasonable method permitted under Treas. Reg.
Sect 1.401(k)-1(f)(4).
13.8. Required Records. The Company shall maintain records that
are sufficient to demonstrate that the ADP, ACP and Multiple Use Test has
been met for each Plan Year for at least as long as the Employer's
corresponding tax year is open to audit.
13.9. Incorporation by Reference. The provisions of this Section
are intended to satisfy the requirements of Code Sections 401(k)(3),
(m)(2), (m)(9) and Treas. Reg. Sects 1.401(k)-1(b), 1.401(m)-1(b) and
1.401(m)-2 and, to the extent not otherwise stated in this Section, those
Code Sections and Treasury Regulations are incorporated herein by
reference.
13.10. QSLOB. The Company in its sole discretion may apply the
provisions of this Article separately with respect to each qualified
separate line of business, as defined in Section 414(r) of the Code.
ARTICLE XIV
TRUST AGREEMENT
14.1. Trust Agreement. The Company shall enter into one or more
Trust Agreements to provide for the holding, investment and payment of
Plan assets. All Trust Agreements, as from time to time amended, shall
continue in force and shall be deemed to form a part of the Plan. Subject
to the requirements of the Code and ERISA, the Company may cause assets of
the Plan that are securities to be held in the name of a nominee or in the
street name provided such securities are held on behalf of the Plan by:
(a) a bank or trust company that is subject to
supervision by the United States or a State,
or a nominee of such bank or trust company;
(b) a broker or dealer registered under the
Securities Exchange Act of 1934, or a nominee
of such broker or dealer; or
(c) a "clearing agency" as defined in Section
3(a)(23) of the Securities Exchange Act of
1934, or its nominee.
14.2. Selection of Trustee. The Company shall select, remove or
replace the Trustee in accordance with the Trust Agreement. The
subsequent resignation or removal of a Trustee and the approval of its
accounts shall be accomplished in the manner provided in the Trust
Agreement.
14.3. Trustee's Duties and Fees. Except as provided in ERISA, the
powers, duties and responsibilities of the Trustee shall be as stated in
the Trust Agreement, and unless expressly stated or delegated to the
Trustee (with the Trustee's acceptance), nothing contained in this Plan
shall be deemed by implication to impose any additional powers, duties or
responsibilities upon the Trustee. All Contributions and Rollover
Contributions shall be paid into the Trust, and all benefits payable under
the Plan shall be paid from the Trust. Investment Fund management fees,
Trustee fees and recordkeeper fees shall be paid from Participants'
Accounts.
14.4. Separate Entity. The Trust Agreement under this Plan from
its inception shall be a separate entity aside and apart from Employers
or their assets, and the corpus and income thereof shall in no event and
in no manner whatsoever be subject to the rights or claims of any creditor
of any Employer.
14.5. Plan Asset Valuation. As of each Valuation Date, the Fair
Market Value of the Plan's assets held or posted to an Investment Fund
shall be determined by the Company or the Trustee, as appropriate.
14.6. Right of Employers to Plan Assets. The Employers shall have
no right or claim of any nature in or to the assets of the Plan except the
right to require the Trustee to hold, use, apply, and pay such assets in
its possession in accordance with the Plan for the exclusive benefit of
the Participants or their Beneficiaries and for defraying the reasonable
expenses of administering the Plan; provided, that:
(a) if the Plan receives an adverse determination
with respect to its initial qualification
under Sections 401(a), 401(k) and 401(m) of
the Code, Contributions conditioned upon the
qualification of the Plan shall be returned
to the appropriate Employer within one (1)
year of such denial of qualification;
provided, that the application for
determination of initial qualification is
made by the time prescribed by law for filing
the respective Employer's return for the
taxable year in which the Plan is adopted, or
by such later date as is prescribed by the
Secretary of the Treasury;
(b) if, and to the extent that, the deduction for
a Contribution under Section 404 of the Code
is disallowed, Contributions conditioned upon
deductibility shall be returned to the
appropriate Employer within one (1) year
after the disallowance of the deduction;
(c) if, and to the extent that, a Contribution is
made through mistake of fact, such
Contribution shall be returned to the
appropriate Employer within one year of the
payment of the Contribution; and
(d) any amounts held suspended pursuant to the
limitations of Code Section 415 shall be
returned to the Employers upon termination of
the Plan.
All Contributions made hereunder are conditioned upon the Plan being
qualified under Sections 401(a) or 401(k) and 401(m) of the Code and a
deduction being allowed for such contributions under Section 404 of the
Code. Pre-Tax Contributions returned to an Employer pursuant to this
Section shall be paid to the Participant for whom contributed as soon as
administratively convenient. If these provisions result in the return of
Contributions after such amounts have been allocated to Accounts, such
Accounts shall be reduced by the amount of the allocation attributable to
such amount, adjusted for any losses or expenses.
ARTICLE XV
ADMINISTRATION AND INVESTMENT MANAGEMENT
15.1. General. The Company has the power and authority to act
with respect to all matters that relate to the Plan and Trust. The
Company shall be a Named Fiduciary with respect to the authority to manage
and control the administration and operation of the Plan, and with respect
to authority to manage and control the Plan or Trust or the Plan's assets.
The Company shall cease to be a Named Fiduciary with respect to some
specified portion of the operation and administration of the Plan or Trust
to the extent that the Company designates a Named Fiduciary pursuant to
the procedure in the Plan or Trust to severally have authority to manage
and control such portion of the operation and administration of the Plan
or Trust.
15.2. Procedures for Designation of a Named Fiduciary. The
Company may from time to time, designate a person to be a Named Fiduciary
with respect to some portion of the authority it may have with respect to
management and control of the operation and administration of the Plan or
the management and control of the Plan's assets. Such designation shall
specify the person designated by name and either: (a) specify the
management and control authority with respect to which the person will be
a Named Fiduciary; or (b) incorporate by reference an agreement with such
Named Fiduciary to provide services to or on behalf of the Plan or Trust
and use such agreement as a means for specifying the management and
control authority with respect to which such person will be a Named
Fiduciary. The authority to manage and control, which any person who is
designated to be a Named Fiduciary hereunder may have, shall result in the
Company no longer being a Named Fiduciary with respect to, nor having any
longer, such authority to manage and control. On and after the
designation of a person as a Named Fiduciary, the Employer, the Company,
and any other Named Fiduciary with respect to the Plan or Trust, shall
have no liability for the acts (or failure to act) of any such Named
Fiduciary except to the extent of its co-fiduciary duty under ERISA. Each
Named Fiduciary, by signing its contract or by accepting such amendment
or correspondence and rendering the services requested without objection
for thirty (30) days, shall be conclusively bound to have assumed such
fiduciary responsibility as a Named Fiduciary. Fiduciary duties and
responsibilities that have been allocated or delegated pursuant to the
terms of the Plan or the Trust, are intended to limit the liability of the
Company and each Named Fiduciary, as appropriate, in accordance with the
provisions of Section 405(c) of ERISA.
15.3. Responsibility and Powers of the Company Regarding
Administration of the Plan. The Company shall have full and complete
authority, responsibility and control (unless an allocation has been made
to another Named Fiduciary in which case such Named Fiduciary shall have
such authority, responsibility and control only if specifically provided)
over the management, administration, and operation of the Plan or Trust
and the power to act on behalf of the Plan or Trust, including, but not
limited to, the authority and discretion to:
(a) Formulate, adopt, issue and apply procedures
and rules and change, alter or amend such
procedures and rules in accordance with law
and as may be consistent with the terms of
the Plan or Trust;
(b) Specify the basis upon which payments are to
be made under the Plan and, as the final
appeals fiduciary under ERISA Section 503, to
make a final determination, based upon the
information known to it within the scope of
its authority and control as a Named
Fiduciary, based upon determinations made and
such other information made available from an
Employer plus such final determinations made
by each other Named Fiduciary within the
scope of its authority and control, as are
determined to be relevant to the final
appeals fiduciary;
(c) Exercise such discretion as may be required
to construe and apply the provisions of the
Plan or Trust, subject only to the terms and
conditions of the Plan or Trust and ERISA;
(d) Appoint and compensate such specialists
(including attorneys, actuaries and
accountants) to aid it in the administration
of the Plan, and arrange for such other
services, as the Company considers necessary
or appropriate in carrying out the provisions
of the Plan;
(e) Appoint and compensate an independent outside
accountant to conduct such audits of the
financial statements of the Trust as the
Company considers necessary or appropriate;
(f) Settle or compromise any litigation against
the Plan or a Fiduciary with respect to which
the Plan has an indemnity obligation;
(g) Appoint the Plan Administrator to act within
the duties and responsibilities set forth in
Section 15.10;
(h) Create a legal remedy to the Plan with
respect to a Participant or Beneficiary, or
to a Participant or Beneficiary, for any loss
incurred (whether restitution or opportunity
losses) by the Plan on behalf of such
Participant or Beneficiary, or by such
Participant or Beneficiary, due to a breach
of fiduciary duty to the Plan by a Named
Fiduciary or other error (whether negligent
or willful) which the Company determines is
a substantial contributing factor to such
loss (or a portion of such loss); and
(i) Take all necessary and proper acts as are
required for the Company to fulfill its
duties and obligations under the Plan or
Trust.
15.4. Information to be Supplied by Named Fiduciary. Whenever a
term, definition, standard, protocol or other basis for determining
whether an Account Balance exists or will be paid under the terms of the
Plan, or which has been incorporated by reference into this Plan, the
Named Fiduciary who has the authority to manage and control the
administration and operation of the Plan with respect to all or any basis
specified for the payment of such Account Balance (including the authority
to establish or amend such term, definition, standard protocol or other
basis) shall provide a copy thereof: (i) to the Company, upon its request;
(ii) to a Participant or Beneficiary but only to the extent required by
law; or (iii) to the extent required in any proceeding involving the Plan
or any Named Fiduciary with respect to the Plan.
15.5. Misrepresentations. The Company may, but shall not be
required to, rely upon any certificate, statement or other representation
made to it by an Employee, Participant, other Named Fiduciary, or other
individual with respect to any fact regarding any of the provisions of the
Plan. Any such certificate, statement or other representation shall be
conclusively binding upon such Employee, Participant, other Named
Fiduciary, or other individual or personal representative thereof, heir,
or assignee (but not upon the Company), and any such person shall
thereafter be estopped from disputing the truth of any such certificate,
statement or other representation.
15.6. Records. The regularly kept records of the designated Named
Fiduciary (or, where applicable, the Trustee) and any Employer shall be
conclusive evidence of a person's age, his or her status as an Eligible
Employee, and all other matters contained therein applicable to this Plan.
15.7. Plan Expenses. Except as provided in Section 14.3: (i) all
expenses of the Plan that have been approved by the Company shall be paid
by the Trust; and (ii) any expenses paid by the Employers may be, if
authorized by the Company, reimbursed from the Trust. If borne by the
Employers, expenses of administering the Plan shall be borne by the
Employers in such proportions as the Company shall determine.
15.8. Fiduciary Capacity. Any person or group of persons may
serve in more than one fiduciary capacity with respect to the Plan.
15.9. Employer's Agent. The Company shall act as agent for each
Employer.
15.10. Plan Administrator. The Plan Administrator (within the
meaning of ERISA Section 3(16)(A)) shall be appointed by the Company; and
in the absence of such appointment, the Company shall be the Plan
Administrator. The Plan Administrator will have full and complete
authority, responsibility and control over the administration and
operation of the Plan with respect to the following:
(a) satisfy all reporting and disclosure
requirements applicable to the Plan, Trust or
Plan Administrator under ERISA, the Code or
other applicable law;
(b) provide and deliver all written forms used by
Participants and Beneficiaries, give notices
required by law, and seek a favorable
determination letter for the Plan and Trust;
(c) withhold any amounts required by the Code to
be withheld at the source and to transmit
funds withheld and any and all necessary
reports with respect to such withholding to
the Internal Revenue Service;
(d) respond to a QDRO;
(e) make available for inspection and to provide
upon request at such charge as may be
permitted and determined by it, documents and
instruments required to be disclosed by ERISA;
(f) take such actions as are necessary to
establish and maintain in full and timely
compliance with any law or regulation having
pertinence to this Plan;
(g) whatever responsibilities are delegated to
the Plan Administrator by the Company; and
(h) interpret and construe the provisions of the
Plan, to make regulations and settle disputes
described above which are not inconsistent
with the terms thereof.
15.11. Named Fiduciary Decisions Final. The decision of the
Company or a Named Fiduciary in matters within its jurisdiction shall be
final, binding, and conclusive upon the Employers and the Trustee and upon
each Employee, Participant, Spouse, Beneficiary, and every other person
or party interested or concerned.
15.12. No Agency. Each Named Fiduciary shall perform (or fail to
perform) its responsibilities and duties or discretionary authority with
respect to the Plan and Trust as an independent contractor and not as an
agent of the Company or any Employer. No agency is intended to be created
nor is the Company empowered to create an agency relationship with a Named
Fiduciary.
ARTICLE XVI
CLAIMS PROCEDURE
16.1. Initial Claim for Benefits. Each person entitled to
benefits under this Plan (a "Claimant") must sign and submit his or her
claim for benefits to the Plan Administrator in writing in such form as
is provided or approved by such Plan Administrator. A Claimant shall have
no right to seek review of a denial of benefits, or to bring any action
in any court to enforce a claim for benefits prior to his or her filing
a claim for benefits and exhausting his or her rights under this Article.
When a claim for benefits has been filed properly, such claim for benefits
shall be evaluated and the Claimant shall be notified by the Plan
Administrator of its approval or denial within ninety (90) days after the
receipt of such claim unless special circumstances require an extension
of time for processing the claim. If such an extension of time for
processing is required, written notice of the extension shall be furnished
to the Claimant by the Plan Administrator prior to the termination of the
initial ninety (90) day period which shall specify the special
circumstances requiring an extension and the date by which a final
decision will be reached (which date shall not be later than one hundred
eighty (180) days after the date on which the claim was filed). A
Claimant shall be given a written notice in which the Claimant shall be
advised as to whether the claim is granted or denied, in whole or in part.
If a claim is denied, in whole or in part, the Claimant shall be given
written notice which shall contain (1) the specific reasons for the
denial, (2) references to pertinent Plan provisions upon which the denial
is based, (3) a description of any additional material or information
necessary to perfect the claim and an explanation of why such material or
information is necessary, and (4) the Claimant's rights to seek review of
the denial.
16.2. Review of Claim Denial. If a claim is denied, in whole or
in part (or if within the time periods prescribed for in the initial
claim, the Plan Administrator has not furnished the Claimant with a denial
and the claim is therefore deemed denied), the Claimant shall have the
right to request that the Plan Administrator review the denial, provided
that the Claimant files a written request for review with the Plan
Administrator within sixty (60) days after the date on which the Claimant
received written notification of the denial. A Claimant (or his or her
duly authorized representative) may review pertinent documents and submit
issues and comments in writing to the Plan Administrator. Within sixty
(60) days after a request for review is received, the review shall be made
and the Claimant shall be advised in writing by the Plan Administrator of
the decision on review, unless special circumstances require an extension
of time for processing the review, in which case the Claimant shall be
given a written notification by the Plan Administrator within such initial
sixty (60) day period specifying the reasons for the extension and when
such review shall be completed (provided that such review shall be
completed within one hundred and twenty (120) days after the date on which
the request for review was filed). The decision on review shall be
forwarded to the Claimant by the Plan Administrator in writing and shall
include specific reasons for the decision and references to Plan
provisions upon which the decision is based. A decision on review shall
be final and binding on all persons for all purposes. If a Claimant shall
fail to file a request for review in accordance with the procedures
described in this Section, such Claimant shall have no right to review and
shall have no right to bring action in any court and the denial of the
claim shall become final and binding on all persons for all purposes.
ARTICLE XVII
ADOPTION AND WITHDRAWAL FROM PLAN
17.1. Procedure for Adoption. Any Commonly Controlled Entity may
by resolution of such Commonly Controlled Entity's board of directors
adopt the Plan for the benefit of its employees as of the date specified
in the board resolution. No such adoption shall be effective until such
adoption has been approved by the Company.
17.2. Procedure for Withdrawal. Any Employer (other than the
Company) may, by resolution of the board of directors of such Employer,
with the consent of the Company and subject to such conditions as may be
imposed by the Company, terminate its adoption of the Plan.
Notwithstanding the foregoing, an Employer will be deemed to have
terminated its adoption of the Plan when it ceases to be a Commonly
Controlled Entity.
ARTICLE XVIII
AMENDMENT, TERMINATION AND MERGER
18.1. Amendments. The Company may amend, modify, change, revise
or discontinue this Plan by amendment at any time; provided, however, that
no amendment shall:
(a) increase the duties or liabilities of the
Trustee without its written consent;
(b) except to the extent permissible under ERISA
and the Code, make it possible for any
portion of the Trust assets to revert to an
Employer to be used for, or diverted to, any
purpose other than for the exclusive benefit
of Participants and Beneficiaries entitled to
Plan benefits and to defray reasonable
expenses of administering the Plan; or
(c) have any retroactive effect as to deprive any
such person of any benefit already accrued,
except that no amendment made to conform the
Plan to Section 401(a) of the Code, or
amendments required or permitted by the Code
any other statute relating to employees'
trusts, or any official regulations or ruling
issued pursuant thereto, shall not be
considered prejudicial to the rights of any
such person.
No amendment to the Plan shall deprive a Participant of his or her
nonforfeitable rights to benefits accrued to the date of the amendment.
18.2. Plan Termination. It is the expectation of the Company that
it will continue the Plan and the payment of Contributions hereunder
indefinitely, but the continuation of the Plan and the payment of
Contributions hereunder is not assumed as a contractual obligation of the
Company or any other Employer. The right is reserved by the Company to
terminate the Plan by action of the Board of Directors of the Company at
any time, and the right is reserved by the Company and any other Employer
by action of the Board of Directors of the Company or such Employer at any
time to reduce, suspend or discontinue its Contributions hereunder,
provided, however, that the Contributions for any Plan Year accrued or
determined prior to the end of said year shall not after the end of said
year be retroactively reduced, suspended or discontinued except as may be
permitted by law. Upon termination of the Plan or complete discontinuance
of Contributions hereunder, each Participant's Account Balance shall be
fully vested. Upon termination of the Plan or a complete discontinuance
of Contributions, unclaimed amounts shall be forfeited and any unallocated
amounts shall be allocated to Participants who are Eligible Employees as
of the date of such termination or discontinuance on the basis of
Compensation for the Plan Year (or short Plan Year). In the event of
termination of the Plan, the Company shall direct the Trustee to
distribute to each Participant the entire amount of his or her Account
Balance as soon as administratively possible, but not earlier than would
be permitted in order to retain the Plan's qualified status under Sections
401(a), (k) and (m) of the Code, as if all Participants who are Employees
had incurred a Termination of Employment on the Plan's termination date.
18.3. Plan Merger. The Plan shall not merge or consolidate with,
or transfer any assets or liabilities to any other plan, unless each
person entitled to benefits would receive a benefit immediately after the
merger, consolidation or transfer (if the Plan were then terminated) which
is equal to or greater than the benefit he or she would have been entitled
to immediately before the merger, consolidation or transfer (if the Plan
were then terminated). The Company shall amend or take such other action
as is necessary to amend the Plan in order to satisfy the requirements
applicable to any merger, consolidation or transfer of assets and
liabilities.
18.4. Action by Company or Employer. Any action required or
permitted to be taken by the Company or an Employer, including, but not
limited to the amendment or termination of the Plan, shall be by written
resolution of its Board of Directors, or by a person or committee duly
authorized to take such action by the Board of Directors.
ARTICLE XIX
SPECIAL TOP-HEAVY RULES
19.1. Application. The special rules applicable to top-heavy
plans under Code Section 416 shall not apply to this Plan unless one or
more key employees (as defined in Section 416 of the Code) is a
Participant in the Plan.
ARTICLE XX
MISCELLANEOUS PROVISIONS
20.1. Assignment and Alienation. Except as otherwise required by
law, no benefit payable under the Plan shall be subject in any manner to
assignment or transfer or be otherwise alienable, either by voluntary or
involuntary act of a Participant or by operation of law, nor subject to
attachment, execution, garnishment, sequestration or other seizure under
any legal, equitable or other process. Any attempted assignment or
transfer or any attempted seizure by any legal or equitable process of any
such person's interest in the Trust contrary to the provisions hereof shall
be void and shall be given no recognition. This Section 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, except
this Section shall not apply if the order is determined to be a QDRO.
(a) Distributions to an Alternate Payee pursuant to a
QDRO shall be made in a lump sum as soon as
practicable after the domestic relations order has
been determined to be a QDRO; provided that, if the
amount to be distributed to the Alternate Payee is
greater than $3,500, such amount will not be
distributed until the Alternate Payee attains age
65 years unless the Alternate Payee consents in
writing to an earlier distribution. If the
Alternated Payee does not consent to immediate
distribution, a separate Account shall be
established for the Alternate Payee. Such Account
shall be valued and accounted for in the same
manner as any other Account. The Alternate Payee
may direct the investment of such Account in the
same manner as any other Participant; provided however,
an Alternate Payee may not acquire Company Stock.
(b) "Alternate Payee" shall mean the spouse, former
spouse, child or other dependent of a Participant
who is recognized by a QDRO as having a right to
receive all, or a portion of, the benefits payable
under the Plan with respect to the Participant.
(c) The Committee shall establish reasonable procedures
to determine the qualified status of domestic
relations orders and to administer distributions
under such qualified orders.
20.2. Notice and Information Requirements. Except as otherwise
provided in this Plan or in the Trust Agreement or as otherwise required
by law, the Employer shall have no duty or obligation to affirmatively
disclose to any Participant or Beneficiary, nor shall any Participant or
Beneficiary have any right to be advised of, any material information
regarding the Employer, at any time prior to, upon or in connection with
the Employer's purchase, or any other distribution or transfer (or
decision to defer any such distribution) of any Company Stock or any other
stock held under the Plan.
20.3. Plan Does Not Affect Employment Rights. The Plan does not
provide any employment rights to any Employee. The Employer expressly
reserves the right to discharge an Employee at any time, with or without
cause, without regard to the effect such discharge would have upon the
Employee's interest in the Plan.
20.4. Deduction of Taxes from Amounts Payable. The Trustee shall
deduct from the amount to be distributed such amount as the Trustee, in
its sole discretion, deems proper to protect the Trustee and the Plan's
assets held under the Trust Agreement against liability for the payment
of death, succession, inheritance, income, or other taxes, and out of
money so deducted, the Trustee may discharge any such liability and pay
the amount remaining to the Participant, the Beneficiary or the deceased
Participant's estate, as the case may be.
20.5. Facility of Payment. If a Participant or Beneficiary is
declared an incompetent or is a minor and a conservator, guardian, or
other person legally charged with his or her care has been appointed, any
benefits to which such Participant or Beneficiary is entitled shall be
payable to such conservator, guardian, or other person legally charged
with his or her care. The decision of the Company in such matters shall
be final, binding, and conclusive upon the Employer and the Trustee and
upon each Employee, Participant, Beneficiary, and every other person or
party interested or concerned. An Employer, the Trustee and the Company
shall not be under any duty to see to the proper application of such
payments.
20.6. Source of Benefits. All benefits payable under the Plan
shall be paid or provided for solely from the Plan's assets held under the
Trust Agreement and the Employers assume no liability or responsibility
therefor.
20.7. Indemnification. To the extent permitted by law each
Employer shall indemnify and hold harmless each member (and former member)
of the Board of Directors of the Company, each member (and former member)
of the Company, and each officer and employee (and each former officer and
employee) of an Employer to whom are (or were) delegated duties,
responsibilities, and authority with respect to the Plan against all
claims, liabilities, fines and penalties, and all expenses reasonably
incurred by or imposed upon him or her (including but not limited to
reasonable attorney fees and amounts paid in any settlement relating to
the Plan) by reason of his or her service under the Plan if he or she did
not act dishonestly, with gross negligence, or otherwise in knowing
violation of the law under which such liability, loss, cost or expense
arises. This indemnity shall not preclude such other indemnities as may
be available under insurance purchased or provided by an Employer under
any by-law, agreement, or otherwise, to the extent permitted by law.
Payments of any indemnity, expenses or fees under this Section shall be
made solely from assets of the Employer and shall not be made directly or
indirectly from the assets of the Plan.
20.8. Reduction for Overpayment. The Company shall, whenever it
determines that a person has received benefit payments under this Plan in
excess of the amount to which the person is entitled under the terms of
the Plan, make two reasonable attempts to collect such overpayment from
the person.
20.9. Limitation on Liability. No Employer nor any agent or
representative of any Employer who is an employee, officer, or director
of an Employer in any manner guarantees the assets of the Plan against
loss or depreciation, and to the extent not prohibited by federal law,
none of them shall be liable (except for his or her own gross negligence
or willful misconduct), for any act or failure to act, done or omitted in
good faith, with respect to the Plan. No Employer shall be responsible
for any act or failure to act of any Trustee appointed to administer the
assets of the Plan.
20.10. Company Merger. In the event any successor corporation to
the Company, by merger, consolidation, purchase or otherwise, shall elect
to adopt the Plan, such successor corporation shall be substituted
hereunder for the Company upon filing in writing with the Trustee its
election so to do.
20.11. Employees' Trust. The Plan and Trust Agreement are created
for the exclusive purpose of providing benefits to the Participants in the
Plan and their Beneficiaries and defraying reasonable expenses of
administering the Plan, and the Plan and Trust Agreement shall be
interpreted in a manner consistent with their being, respectively, a Plan
described in Sections 401(a), 401(k) and 401(m) of the Code and Trust
Agreements exempt under Section 501(a) of the Code. At no time shall the
assets of the Plan be diverted from the above purpose.
20.12. Gender and Number. Except when the context indicates to the
contrary, when used herein, masculine terms shall be deemed to include the
feminine, and singular the plural.
20.13. Invalidity of Certain Provisions. If any provision of this
Plan shall be held invalid or unenforceable, such invalidity or
unenforceability shall not affect any other provisions hereof and the Plan
shall be construed and enforced as if such provisions, to the extent
invalid or unenforceable, had not been included.
20.14. Headings. The headings or articles are included solely for
convenience of reference, and if there is any conflict between such
headings and the text of this Plan, the text shall control.
20.15. Uniform and Nondiscriminatory Treatment. Any discretion
exercisable hereunder by an Employer or the Company shall be exercised in
a uniform and nondiscriminatory manner.
20.16. Law Governing. The Plan shall be construed and enforced
according to the laws of the State of Illinois, to the extent not
preempted by ERISA.
APPENDIX A
Participating Unions
Transportation Communications Union Effective July 1, 1995
Sheet Metal Workers' International
Association Effective July 1, 1995
International Brotherhood of
Boilermakers, Iron Ship Builders,
Blacksmiths, Forgers and Helpers Effective July 1, 1995
National Conference of Firemen and Oilers Effective July 1, 1995
Brotherhood Railway Carmen of
United States and Canada,
Division of Transportation Effective July 1, 1995
Brotherhood of Railroad Signalmen Effective July 1, 1995
APPENDIX B
Investment Funds
The investment Funds offered to Participants and Beneficiaries as
of July 1, 1995 based upon share or unit accounting are:
1. Illinois Central Stock Fund
2. Target 2025 Fund
3. Target 2005 Fund
4. Income Fund
5. Equity (Stock) Fund
If investment instructions are not received from any Participant or
Beneficiary, his or her investment instructions shall be assumed to be a
one hundred percent (100%) investment in the Income Fund.
EXHIBIT 4.2
ILLINOIS CENTRAL RAILROAD COMPANY
UNION EMPLOYEES' SAVINGS TRUST
TABLE OF CONTENTS
PAGE
ARTICLE I. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Introduction. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
I-1. Name . . . . . . . . . . . . . . . . . . . . . . . . . . 1
I-2. Controlling Law. . . . . . . . . . . . . . . . . . . . . 1
I-3. Terms. . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
Fiduciary Responsibilities. . . . . . . . . . . . . . . . . . . . . 2
ARTICLE III. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Relating to the Trust Fund and the Trustee. . . . . . . . . . . . . 3
III-1. The Trust Fund . . . . . . . . . . . . . . . . . . . . 3
III-2. Trustee's General Powers, Rights and Duties. . . . . . 3
III-3. Limitation on Trustee's Powers, Rights and Duties. . . 6
III-4. Qualification of Trust . . . . . . . . . . . . . . . . 6
ARTICLE IV . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Relating to the Company . . . . . . . . . . . . . . . . . . . . . . 7
IV-1. The Company . . . . . . . . . . . . . . . . . . . . . . 7
IV-2. Company's General Powers, Rights and Duties . . . . . . 7
ARTICLE V. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Investment Funds, Investment Managers,
Custodians and Insurance Companies. . . . . . . . . . . . . . . . 10
V-1. Investment Funds . . . . . . . . . . . . . . . . . . . . 10
V-2. Common Investments . . . . . . . . . . . . . . . . . . . 10
V-3. Investment Managers. . . . . . . . . . . . . . . . . . . 10
V-4. Custodians . . . . . . . . . . . . . . . . . . . . . . . 12
V-5. Insurance Companies. . . . . . . . . . . . . . . . . . . 13
ARTICLE VI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Participating Trusts. . . . . . . . . . . . . . . . . . . . . . . . 15
VI-1. Qualified Employer Plans. . . . . . . . . . . . . . . . 15
VI-2. Participating Trusts. . . . . . . . . . . . . . . . . . 15
ARTICLE VII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
Trust Accounting. . . . . . . . . . . . . . . . . . . . . . . . . . 16
VII-1. Accounts. . . . . . . . . . . . . . . . . . . . . . . 16
VII-2. Valuation Date, Valuation Period, Investments . . . . 16
VII-3. Plan Accounts . . . . . . . . . . . . . . . . . . . . 16
VII-4. Adjusted Net Worth. . . . . . . . . . . . . . . . . . 17
VII-5. Combined Investment Funds . . . . . . . . . . . . . . 17
VII-6. Recordkeeping . . . . . . . . . . . . . . . . . . . . 17
VII-7. Company Stock Fund. . . . . . . . . . . . . . . . . . 18
VII-8. Accounting For Investment Funds . . . . . . . . . . . 20
ARTICLE VIII . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Deposits, Withdrawals, Transfers and Distributions. . . . . . . . . 21
VIII-1. Deposits. . . . . . . . . . . . . . . . . . . . . . . 21
VIII-2. Withdrawals, Transfers and Distributions. . . . . . . 21
ARTICLE IX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
General Provisions. . . . . . . . . . . . . . . . . . . . . . . . . 23
IX-1. No Reversion in Employers. . . . . . . . . . . . . . . 23
IX-2. Non-Assignment . . . . . . . . . . . . . . . . . . . . 23
IX-3. Third Parties. . . . . . . . . . . . . . . . . . . . . 23
IX-4. Liabilities Mutually Exclusive . . . . . . . . . . . . 24
IX-5. Limitation of Liability. . . . . . . . . . . . . . . . 24
IX-6. Limit of Responsibility. . . . . . . . . . . . . . . . 24
IX-7. Indemnification. . . . . . . . . . . . . . . . . . . . 24
IX-8. Disagreement as to Acts. . . . . . . . . . . . . . . . 25
IX-9. Courts . . . . . . . . . . . . . . . . . . . . . . . . 25
IX-10. Unrelated Business Taxable Income. . . . . . . . . . . 25
IX-11. Evidence . . . . . . . . . . . . . . . . . . . . . . . 25
IX-12. Mistake of Fact. . . . . . . . . . . . . . . . . . . . 25
IX-13. Attorneys, Agents, Accountants, etc. . . . . . . . . . 25
IX-14. Compensation and Expenses. . . . . . . . . . . . . . . 26
IX-15. Action by the Company. . . . . . . . . . . . . . . . . 27
IX-16. Waiver of Notice . . . . . . . . . . . . . . . . . . . 27
IX-17. Gender and Number. . . . . . . . . . . . . . . . . . . 27
IX-18. Counterparts . . . . . . . . . . . . . . . . . . . . . 27
IX-19. Statutory References . . . . . . . . . . . . . . . . . 27
IX-20. Severability . . . . . . . . . . . . . . . . . . . . . 27
IX-21. Scope of this Agreement. . . . . . . . . . . . . . . . 27
IX-22. Confidentiality. . . . . . . . . . . . . . . . . . . . 27
IX-23. Contesting of Assessed Taxes . . . . . . . . . . . . . 27
IX-24. Form of Instructions . . . . . . . . . . . . . . . . . 28
IX-25. Notices. . . . . . . . . . . . . . . . . . . . . . . . 28
ARTICLE X. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
Changes in Trustee. . . . . . . . . . . . . . . . . . . . . . . . . 29
X-1. Resignation. . . . . . . . . . . . . . . . . . . . . . . 29
X-2. Removal of Trustee . . . . . . . . . . . . . . . . . . . 29
X-3. Duties of Resigning or Removed Trustee and of Successor
Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE XI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
Amendment and Termination . . . . . . . . . . . . . . . . . . . . . 30
XI-1. Amendment . . . . . . . . . . . . . . . . . . . . . . . 30
XI-2. Termination . . . . . . . . . . . . . . . . . . . . . . 30
ARTICLE XII. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Incorporation of Collective Investment Trusts . . . . . . . . . . . 31
<PAGE>
ILLINOIS CENTRAL RAILROAD COMPANY
UNION EMPLOYEES' SAVINGS TRUST
THIS AGREEMENT, made effective as of June _____, 1995, by and between ILLINOIS
CENTRAL RAILROAD COMPANY, a Delaware corporation (the "Company"),
and CONTINENTAL TRUST COMPANY, and its successor or successors and assigns
in the trust hereby evidenced, as Trustee (the "Trustee"),
WITNESSETH THAT:
WHEREAS, the Company and certain of its related companies
(sometimes referred to collectively as the "Employers" and individually
as an "Employer") are maintaining, or hereafter may establish, adopt or
assume, pension and profit sharing plans that meet the requirements of a
"qualified plan" under Section 401(a) of the Internal Revenue Code (the
"Code"); and
WHEREAS, it is deemed desirable and in the best interests of employees
of the Employers who are, or in the future may be, covered by such
qualified pension and profit sharing plans and their beneficiaries that
provision be made for the collective investment of part or all of
the assets of the trusts related to such plans, and this
agreement is designed for that purpose;
NOW, THEREFORE, in consideration of the mutual undertakings of the
parties hereto, IT IS AGREED AS FOLLOWS:
ARTICLE I
Introduction
I-1. Name. This agreement and the trust hereby evidenced may be
referred to as "Illinois Central Railroad Company Union
Employees' Savings Trust."
I-2. Controlling Law. To the extent not superseded by federal
law, the laws of the State of Illinois shall control in all matters
relating to this agreement.
I-3. Terms. Various terms are defined and used in this agreement,
including the term "trust fund" defined in Article III, the terms
"investment fund," "investment manager," "custodian," and
"insurance company" defined in Article V, the terms
"qualified Employer plan" and "participating trust" defined in
Article VI, and the terms "valuation date," "valuation period" and
"adjusted net worth" defined in Article VII.
ARTICLE II
Fiduciary Responsibilities
It is specifically intended that all provisions of this agreement
shall be applied so that all fiduciaries with respect to this
agreement shall be required to meet the prudence, diversification and
other requirements and responsibilities of applicable law to the
extent such requirements and responsibilities apply to them,
but that, subject to applicable law, each such fiduciary shall be
responsible only for the carrying out of the requirements,
responsibilities, obligations and duties placed upon such fiduciary by
provisions of this agreement. No provisions of this agreement
are intended to relieve a fiduciary from any requirement,
responsibility, obligation or duty imposed by applicable law.
In general, a fiduciary shall discharge its duties with respect to
this trust solely in the interests of participants and
beneficiaries under the plans related to the trusts that deposit
assets in this trust and with the care, skill, prudence and
diligence under the circumstances then prevailing that a prudent man
acting in like capacity and familiar with such matters would use
in the conduct of an enterprise of like character and with like aims.
ARTICLE III
Relating to the Trust Fund and the Trustee
III-1. The Trust Fund. Unless the context clearly implies or
indicates the contrary, the term "trust fund" comprises all
property of every kind held by the Trustee (or any custodian or
insurance company) under this agreement.
III-2. Trustee's General Powers, Rights and Duties.
With respect to the trust fund and subject only to the limitations
expressly provided in this agreement (including the powers
reserved to the Company, investment managers, custodians and
insurance companies under this agreement), or imposed by
applicable law, the Trustee shall have the following powers, rights
and duties in addition to those vested in it elsewhere in this
agreement or by law:
(a) To manage, sell, contract to sell, grant
options to purchase, convey, exchange,
transfer, abandon, improve, repair,
insure, lease for any term even though
commencing in the future or extending
beyond the term of the trust, and
otherwise deal with, all property, real
or personal, in such manner, for such
considerations, and on such terms and
conditions as the Trustee shall decide.
(b) To retain in interest bearing cash
equivalents such amounts as the Trustee
considers advisable and as are permitted
by applicable law.
(c) To invest and reinvest the balance of the
trust fund in any shares of stock, bonds,
mortgages, notes, mutual fund shares or
other property of any kind, real or
personal (including investment in any
common, commingled or collective trust
fund or pooled investment fund described
in Article XII and in a deposit account
or deposit administration fund described
in Article V), to buy and sell interest
rate and stock index futures contracts
traded on a regulated exchange that are
offset by cash reserves or
counterbalanced against appropriate fixed
income or stock positions held by the
Trustee and to write covered call options
with respect to any securities held in
the trust fund and to purchase put and
call options, provided such options are
listed on a recognized trading exchange,
and to diversify such investments so as
to minimize the risk of large losses
unless under the circumstances it is
clearly prudent not to do so; provided,
however, that (i) when directed by an
investment manager pursuant to
paragraph V-3, the Trustee shall acquire,
retain or dispose of such investments as
are specified in such direction; and (ii)
when directed by the Company pursuant to
subparagraph IV-2(g), and in accordance
with a written agreement between the Com-
pany and the Trustee, the Trustee shall
lend securities of the trust fund to the
extent consistent with Department of
Labor Prohibited Transaction Exemption
81-6 and any supplementary or successor
exemption.
(d) To invest cash balances prior to
investment in an investment fund in any
type of investment which bears a rate of
interest which the Trustee considers
reasonable, including short-term cash
equivalents having ready marketability,
such as United States treasury bills and
other short-term government obligations,
commercial paper, certificates of deposit
(including certificates of deposit issued
by the bank acting as Trustee), and
similar types of securities and money
market instruments, and part interests in
any one or more of the foregoing, and
including investment in any appropriate,
common, collective or commingled short-
term investment fund described in Art-
icle XII, and to invest in such short-
term cash equivalents cash balances in an
investment fund established for that
purpose.
(e) When directed by the Company pursuant to
subparagraph IV-2(b), to establish or
terminate investment funds, to transfer
or direct the transfer of assets
specified by the Company from any
investment fund to any other investment
fund held by the Trustee, a custodian or
an insurance company and, if assets of an
investment fund are to be invested in a
deposit account or a deposit
administration fund maintained by a legal
reserve life insurance company pursuant
to an agreement between the Trustee and
such insurance company or a group annuity
contract issued by such insurance company
to the Trustee as contract holder, or if
assets of an investment fund are to be
used to purchase shares or interests in
a pooled investment fund, as described in
Article XII, pursuant to an agreement
between the Trustee and the Trustee or
Trustees of such pooled investment fund,
to execute such agreement or apply for
such contract and to transfer assets to
such deposit account or deposit
administration fund or to purchase such
shares or interests, as the case may be.
(f) When directed by the Company pursuant to
subparagraph IV-2(c) to effect
withdrawals from the investment funds and
distribute the proceeds to participating
trusts, and to require, before making any
distribution, such releases, indemnities
or other documents from any lawful taxing
authority or governmental body, depart-
ment or agency as it may consider
necessary for its protection without
liability for the payment of interest on
funds retained by it pending receipt by
it of such releases, indemnities or other
documents, except to the extent interest
is actually credited to the trust fund
for such balances.
(g) When directed by the Company pursuant to
subparagraph IV-2(d), to employ one or
more professional investment advisors
(which may be or include the bank acting
as Trustee) for the purpose of the
evaluation of the investment performance
of any investment fund or funds on such
terms and conditions as shall be
specified by the Company.
(h) When directed by the Company pursuant to
subparagraph IV-2(e), to make purchases
or sales of such securities or other
property or part interests therein as the
Company may consider appropriate with
respect to the investment and
reinvestment of assets of the trust fund
(subject to the power, right and duty of
the Trustee to invest cash balances on a
short term basis to the same extent as
described in subparagraph V-3(f)).
(i) To the extent permitted by law, and with
the approval of the Company, to borrow
from anyone (including the bank acting as
Trustee) from time to time such amount or
amounts as the Trustee considers
desirable to carry out this trust, and
for that purpose to mortgage or pledge
all or any part of the trust fund.
(j) To retain any funds or property subject
to any dispute, and to decline to make
payment or delivery thereof until final
adjudication is made by a court of
competent jurisdiction or an appropriate
release is obtained.
(k) To begin, maintain or defend any
litigation necessary in connection with
the administration of this trust, except
that the Trustee shall not be obligated
to do so unless required by law or unless
it is indemnified to its satisfaction.
(l) To compromise, contest, arbitrate or
abandon claims and demands.
(m) To hold securities or other property in
the name of the Trustee or its nominee,
or in any other way, with or without
disclosing the trust relationship;
provided, however, that except as
authorized by regulations issued by the
Secretary of Labor, the indicia of
ownership of the trust fund shall not be
maintained outside the jurisdiction of
the district courts of the United States.
(n) To give proxies to vote stocks and other
voting securities, to join in or oppose
(alone or jointly with others) voting
trusts, mergers, consolidations,
foreclosures, reorganizations,
liquidations or other changes in the
financial structure of any corporation,
and to exercise or sell stock
subscription or conversion rights.
(o) To determine and report to the Company as
of each valuation date the net worth of
the trust fund, the fair market value of
the assets of each investment fund, the
fair market value of deposits made in the
form of securities or other property, and
the fair market value of securities or
other property to be distributed to
participating trusts, all as determined
by the Trustee on an accrual basis on the
basis of such evidence, data and
information as it considers pertinent and
reliable; provided, however, that as to
any assets held by a custodian or insur-
ance company, and subject to applicable
law, the Trustee may rely upon the
valuation of such assets by such
custodian or insurance company for
purposes of this subparagraph.
(p) To furnish the Company with a monthly
statement of account, or a statement of
account for such other period as the
Company may specify, showing the
condition of the trust fund and all
investments, receipts, disbursements and
other transactions made by the Trustee or
any investment manager during the
accounting period, and also stating the
assets of the trust fund held at the end
of the period, and, subject to applicable
law and the terms of paragraph IX-6, such
statement of account shall be conclusive
on all persons, including the Employers
and the Company, except as to any act or
transaction as to which the Company files
with the Trustee written exceptions or
objections within one hundred eighty days
after the receipt of the statement of
account, and the approval by the Company
of any account, act, or procedure of the
Trustee shall be full acquittance and
discharge to the Trustee with respect
thereto.
(q) To invest in common stock of the Company
by creating an investment fund that
consists solely or primarily of common
stock of the Company.
(r) To perform any and all other acts which
in the Trustee's judgment are necessary
or appropriate for the proper and
advantageous management, investment and
distribution of the trust fund.
III-3. Limitation on Trustee's Powers, Rights and Duties.
Except to the extent otherwise provided by law, no powers,
rights, duties or responsibilities are imposed on the Trustee
other than those set forth in this agreement.
III-4. Qualification of Trust. Until they determine or are
advised to the contrary, the Trustee, the Company and each
investment manager and insurance company may assume that this trust is
qualified under Section 401(a), and is entitled to tax exemption
under Section 501(a), of the Code.
ARTICLE IV
Relating to the Company
IV-1. The Company. The Company shall have the powers, rights,
duties and responsibilities with respect to this trust that are
described in paragraph IV-2 below and elsewhere in this
agreement. The Company shall certify to the Trustee and the
investment managers then acting any persons that are authorized
to sign on behalf of the Company and, subject to applicable law, the
Trustee and each investment manager may rely on the latest such
certificate received without further inquiry or verification.
IV-2. Company's General Powers, Rights and Duties. The Company
shall have the following powers, rights and duties in connection
with the investment of the trust fund in addition to those and
elsewhere in this agreement:
(a) To direct the Trustee from time to time,
at the discretion of the Company, to
invest cash balances prior to investment
in an investment fund in short-term cash
equivalents having ready marketability,
including but not limited to United
States treasury bills and other
short-term government obligations, com-
mercial paper, certificates of deposit
(including certificates of deposit issued
by the bank acting as Trustee) and
similar types of securities and money
market instruments, and part interests in
any one or more of the foregoing, and
including investment in any appropriate
common, collective, or commingled
short-term investment fund described in
Article XII, and to invest in such
short-term cash equivalents cash balances
in an investment fund established for
that purpose.
(b) To direct the Trustee from time to time,
at the discretion of the Company, to
establish one or more investment funds,
to transfer assets specified by the
Company from one investment fund to
another investment fund, to transfer
assets held by the Trustee to a custodian
of an investment fund, and, if assets of
an investment fund are to be invested in
a deposit account or a deposit
administration fund maintained by a legal
reserve life insurance company pursuant
to an agreement between the Trustee and
such insurance company or a group annuity
contract issued by such insurance com-
pany, or if assets of an investment fund
are to be used to purchase shares or
interests of a pooled investment fund, as
described in Article XII, pursuant to an
agreement between the Trustee and the
trustee or trustees of such pooled
investment fund, to direct the Trustee to
execute such agreement or apply for such
contract and to transfer assets to such
deposit account or deposit administration
fund or to purchase such shares
or interests, as the case may be,
pursuant to Article V.
(c) To direct the Trustee from time to time
to effect withdrawals from the investment
funds and to distribute the proceeds to
participating trusts pursuant to
paragraph VIII-2.
(d) To appoint or remove investment managers
pursuant to paragraph V-3, to employ
professional investment advisors to
recommend investment policy and specific
investments and to manage investment
funds established under Article V, and,
at its discretion, to direct the Trustee
to employ professional investment
advisors (which may be or include
the bank acting as Trustee) for the
purpose of evaluation of the investment
performance of any investment fund or
funds on such terms and conditions as
shall be specified by the Company.
(e) To make purchases or sales, or direct the
Trustee to make purchases or sales, or to
issue directly to a broker or dealer
orders for purchases or sales of such
securities or other property or part
interests therein as it may consider
appropriate with respect to the
investment and reinvestment of assets of
an investment fund described in the next
following sentence, provided that, the
investment powers so assumed by the
Company shall be consistent with the
investment powers generally reserved to
the Trustee pursuant to paragraph III-2.
All investments or investment direction
by the Company shall control only those
investment funds that the Company has
directed the Trustee to establish
pursuant to paragraph V-1 and that have
been designated in writing by the Company
to the Trustee as investment funds over
which the Company shall have exclusive
investment control (subject to the power,
right and duty of the Trustee to invest
cash balances on a short-term basis to
the same extent as described in
subparagraph V-3(f)). All instructions
and directions of the Company to the
Trustee as to an investment fund shall be
made in writing delivered by hand or by
first class or overnight mail, or, at the
option of the Trustee, by facsimile or
orally by an employee of the Company
known to the Trustee and confirmed in
writing as soon as practicable
thereafter, and the Company shall
instruct each broker, dealer or other
person executing any order on behalf of
the fund to furnish to the Trustee a
broker or dealer confirmation promptly
after execution of such transaction.
(f) To establish, at its discretion, one or
more committees for the purpose of
carrying out part or all of the Company's
duties and responsibilities under this
agreement, with the members of each such
committee serving at the pleasure of the
Company; and references in this
agreement to the Company, to the extent
its duties and responsibilities have been
delegated to a committee, shall include
such committee; and each committee so
established shall act in accordance with,
and subject to, the provisions of
paragraph IV-3 as if such committee were
the Company.
(g) To direct the Trustee from time to time,
at the discretion of the Company, to lend
securities of the trust fund pursuant to
a written agreement between the Company
and the Trustee. Such written agreement
shall require that the lending of
securities by the Trustee be consistent
with Department of Labor Prohibited
Transaction Exemption 81-6 and any
supplementary or successor exemption,
shall provide for the transfer of
securities to the borrower and the
investment of the collateral received in
exchange for such securities, and shall
direct the Trustee to enter into an
appropriate broker loan agreement with
the borrower or borrowers. Not-
withstanding any other provisions of this
agreement to the contrary, a borrower
shall have the authority and
responsibility to vote securities it has
borrowed pursuant to the broker loan
agreement between that borrower and the
Trustee. The Trustee shall maintain a
record of the market value of all loaned
securities and shall be paid reasonable
compensation for services rendered by the
Trustee in the lending of securities of
the trust fund pursuant to this
subparagraph as agreed to from time to
time between the Trustee and the Company.
ARTICLE V
Investment Funds, Investment Managers,
Custodians and Insurance Companies
V-1. Investment Funds. Concurrent with the establishment of
this trust, and from time to time thereafter, the Company shall
direct the Trustee to establish and maintain one or more investment
funds (the "investment funds") for the purpose of investing the
deposits of participating trusts. The Trustee shall transfer to each
investment fund such portion of the assets of the trust fund as the
Company directs in writing. The investment funds so established
may be designated alphabetically (e.g., "Fund A," "Fund B," etc.),
or by reference to the investment manager appointed to manage such
fund or the type of investment to be undertaken by that manager
(e.g., fixed income, growth equity, etc.), or in such other way
as the Company may direct. Except to the extent that (i) investment
managers have been appointed for an investment fund pursuant to
paragraph V-3, (ii) assets of an investment fund have been
transferred to an insurance company pursuant to paragraph V-5, or
(iii) the Company has investment responsibility for assets in an
investment fund pursuant to subparagraphs IV-2(a) and (e),
the investment of the assets of each investment fund shall be the
responsibility of the Trustee. Investment of the assets by such
investment managers or such insurance company shall be pursuant to the
provisions of the applicable agreement or group annuity contract.
Investment of the assets of an investment fund shall be made
pursuant to investment guidelines promulgated by the Company
for that investment fund, which guidelines shall be furnished in
writing to the investment manager, if any, appointed for that
investment fund and to the Trustee. The investment guidelines
for any investment fund may be modified by the Company from
time to time, but such revised guidelines shall be promptly
furnished in writing to the investment manager, if any, for
that investment fund and to the Trustee.
V-2. Common Investments. Except as directed by the Company,
it shall not be necessary to make any separate investment of the
assets of an investment fund for the individual benefit of any
participating trust and all deposits made to an investment fund
may be held and invested as a single fund.
V-3. Investment Managers. The Company, from time to time and
at its sole discretion, may appoint a professional investment
counsel other than the Trustee as "investment manager" of all or any
portion of any investment fund established pursuant to the
direction of the Company, subject to the following:
(a) More than one investment manager may be
appointed for any single investment fund.
(b) Appointment of an investment manager
shall be made by written notice to the
investment manager and the Trustee, which
notice shall specify those powers, rights
and duties of the Trustee under this
agreement that are allocated to the
investment manager and that portion of
the assets of the trust fund subject to
investment direction by that investment
manager. An investment manager so
appointed pursuant to this subparagraph
shall be a registered investment adviser
under the Investment Advisers Act of
1940, or a bank defined in said Act, or
a legal reserve life insurance company
qualified to manage, acquire or dispose
of assets of the trust fund under the
laws of more than one state, and shall
acknowledge in writing to the Company
that it accepts such appointment and is
a fiduciary with respect to this trust,
the participating trusts and related
plans insofar as the management and
control of investments of the trusts and
participating trusts are concerned.
(c) The Company shall promptly notify the
Trustee in writing of the appointment of
an investment manager and thereafter the
Trustee shall be subject to the direction
of the investment manager as respects the
investment, retention or sale of the
assets of the applicable investment fund,
including the receipt and delivery of
assets purchased or sold by the
investment manager. The Trustee may
assume that such appointment continues in
effect until it receives written notice
to the contrary from the Company or such
investment manager or until it has other
reason to believe that the appointment is
no longer effective.
(d) An investment manager may resign at any
time upon 60 days' prior written notice
to the Company and the Trustee. The
Company may remove an investment manager
at any time by prior written notice to
the investment manager and written notice
to the Trustee.
(e) Subject to applicable law, it is intended
that an investment manager shall have
full responsibility with respect to the
investment of the assets of the
investment fund for which it has the
power of investment direction and that
the Trustee shall have no obligation as
to the investment of such assets as long
as they are subject to investment
direction by that investment manager.
(f) Notwithstanding subparagraph (e) next
above, with the prior approval of the
investment manager for that fund, the
Trustee shall have the power, right and
duty to invest cash balances held by it
from time to time as a part of an
investment fund in any type of investment
which bears a rate of interest that the
Trustee considers reasonable, including
short-term cash equivalents having ready
marketability, such as United States
treasury bills and other short-term
government obligations, commercial paper,
certificates of deposit (including
certificates of deposits issued by the
bank acting as Trustee) and similar types
of securities and money market in-
struments and part interests in any one
or more of the foregoing, and including
investment in any appropriate common,
commingled or collective short-term
investment fund maintained by the bank
acting as Trustee, and the Trustee also
shall have the power, right and duty to
sell such short-term investments as may
be necessary to carry out the
instructions of the investment manager or
the Company regarding that investment
fund.
V-4. Custodians. If the Company appoints a national banking
association or bank incorporated under state law as investment
manager of any investment fund (the "fund"), then,
notwithstanding any other provisions of this agreement,
the Company may also designate such bank to be employed by
the Trustee as "custodian" of the assets from time to time forming
a part of that fund, in which event the following shall apply:
(a) The Trustee shall enter into an agreement
with the bank so named employing it as
agent of the Trustee and custodian of the
fund and delegating to the custodian the
same powers, rights and duties otherwise
reserved to the Trustee under this
agreement in regard to the retention and
administration of the fund, it being
intended that, except as provided to the
contrary in this paragraph V-4, the
conditions and limitations of this
agreement otherwise applicable to the
Trustee shall be applicable to the
custodian, but only with respect to the
fund, and the custodian shall have
responsibility for the holding and
safekeeping of the assets of the fund, in
addition to its duties as investment
manager, and shall maintain the records
and accounts, and shall submit to the
appropriate party or parties the periodic
reports, otherwise required of the
Trustee as to the fund.
(b) The provisions of such agreement shall
include the right reserved to the
custodian to resign as such at any time
by giving prior written notice to the
Company and the Trustee and the right
reserved to the Trustee to terminate the
employment of the custodian at any time
by giving prior written notice to the
custodian and the Company.
(c) The custodian shall be entitled to
reasonable compensation for its duties as
such as may be agreed upon from time to
time between the custodian and the
Company, which compensation may be
included in and paid pursuant to the
custodian's compensation arrangement with
the Company for services rendered by it
as investment manager.
(d) The Trustee shall promptly transfer to
the custodian the assets of the fund and,
until its employment as custodian ends
and all assets held by it as to that fund
have been returned to the possession of
the Trustee, the custodian shall hold and
be responsible for the retention and
administration of the assets of the fund
as agent of the Trustee.
If the Company designates a legal reserve life insurance company as
investment manager of any investment fund pursuant to paragraph V-3, then,
notwithstanding any other provisions of this agreement, the Company shall
direct the Trustee to execute an appropriate form of agreement between the
Trustee and such insurance company providing for the investment of the assets
of that investment fund by the insurance company and for purposes of this
agreement the insurance company shall be deemed to be the
"custodian" of the assets which are transferred from time to time
to the insurance company as a part of the investment fund.
V-5. Insurance Companies. The Company, at its sole discretion,
may direct the Trustee to execute an agreement with a legal
reserve life insurance company selected by the Company or apply
for a group annuity contract issued by a legal reserve life insurance
company selected by the Company to the Trustee as contract holder
for the purpose of investing assets of an investment fund.
The Company shall direct the Trustee to transfer assets of the
investment fund to the insurance company for investment in a deposit
account or deposit administration fund maintained by it pursuant to
such agreement or group annuity contract. If such agreement or
contract does not constitute a guaranteed benefit policy
(as defined in Section 401(b)(2)(B) of ERISA), but does provide for
the allocation of amounts received by the insurance company
thereunder solely to one or more of its separate accounts
(including separate accounts maintained for the collective
investment of assets of qualified retirement plans), or to the
insurance company's general account and one or more of such
separate accounts, then, notwithstanding any other provisions of this
agreement to the contrary, the following shall apply with respect to such
agreement or contract (referred to below as the "separate account contract"):
(a) The Company may appoint the insurance
company as investment manager of the
investment fund under which the separate
account contract shall be held to the
extent that amounts held by the insurance
company thereunder shall be deemed "plan
assets" under ERISA.
(b) The insurance company shall have the
exclusive responsibility for the
investment and management of any amounts
held in the separate account contract,
subject to the right of the Trustee,
acting upon the direction of the Company
or the investment manager, if any, to
specify the amounts under the separate
account contract that are to be allocated
among the accounts provided for in such
contract (unless the insurance company is
given responsibility for determining the
allocation of amounts among the various
accounts provided for in the separate
account contract).
(c) For purposes of this Trust, none of the
assets held by the insurance company
under the separate account contract, whe-
ther or not they may be deemed "plan
assets" under ERISA, shall constitute or
be considered as, assets of the trust
fund, except that the separate account
contract and participation units acquired
by the Trustee pursuant to such contract
shall constitute, and shall be considered
as, assets of the trust fund.
(d) The Trustee may, as directed by the
Company, pursuant to the separate account
contract, participate in any separate
account available thereunder, including,
but not limited to, a separate account
composed primarily of investments in
property of any kind, real or personal,
or part interest (including any partner-
ship interest) in property, real or
personal, foreign or domestic, and in any
rights, warrants and options to acquire
any such property, and without regard to
any limitations of state law on
investments by fiduciaries, and without
distinction between principal and income.
The term "insurance company" as used in this agreement means an insurance
company described above in this paragraph V-5.
ARTICLE VI
Participating Trusts
VI-1. Qualified Employer Plans. For purposes of this agreement a
"qualified employer plan" means an employee pension benefit plan that
is maintained by an Employer and meets the requirements of Section
401(a) of the Code, and is to be funded by a trust that is exempt
from taxation under Section 501(a) of the Code. The plan document
or the trust instrument evidencing the trust expressly
authorizes deposits of part or all of the assets of that plan or
trust to be made in this trust so that such assets may be
commingled with the assets of other qualified plans and trusts
for investment purposes and such plan documents or trust in-
strument incorporates the provisions of this agreement by reference.
VI-2. Participating Trusts. The Company shall designate in
writing to the Trustee of this trust, each qualified Employer
plan that is to be a "participating trust" under this agreement.
Each such qualified Employer plan shall become a participating trust
concurrent with its initial deposit of assets in this trust.
A participating trust's initial deposit, and any subsequent
deposits, shall be made in accordance with the provisions of
paragraph VIII-1. A participating trust shall continue as such
until its entire investments in the investment funds have been
withdrawn and the proceeds thereof distributed to the participating
trust pursuant to paragraph VIII-2.
ARTICLE VII
Trust Accounting
VII-1. Accounts. The Company shall establish and maintain a
separate account in the name of each participating trust for each
investment fund in which that participating trust makes an investment.
Such account shall reflect the number of units that represent the
participating trust's investment in that fund and shall be adjusted
as of each valuation date in accordance with paragraph VII-3.
VII-2. Valuation Date, Valuation Period, Investments.
The "valuation date" for the trust fund and for each investment
fund within that trust fund shall be the last day of each calendar
month and reference to the "valuation period" as to that
fund means the calendar month. Reference to a participating trust's
"investment" in an investment fund means a new deposit made by that
participating trust which is invested in that investment fund or
amounts which are transferred from any other investment fund or funds
on behalf of that participating trust and invested in that investment
fund, as the case may be.
VII-3. Plan Accounts. The Trustee shall establish and maintain
within the trust fund an account (hereinafter referred to as a
"plan account") for each plan and participating trust to reflect the
interest of each plan and participating trust in the entire trust
fund. Each plan account shall be credited with Employer and
participants' contributions under the related plan, with its
proportionate part of the earnings of the trust fund and any
increase in the values thereof, and with the earnings on and any
increase in the values of any investment fund or other assets of
said plan account, and shall be charged with distributions
pursuant to provisions of the related plan, with its proportionate
part of the costs and expenses of the trust fund and any decrease
in the values thereof, and with the costs and expenses incurred
with respect to and any decrease in the values of any such
investment fund or other assets of said plan account.
(a) With respect to any plan or participating
trust that first becomes such after the
effective date of this agreement, the
plan account established hereunder for
such plan or participating trust shall
initially reflect an undivided interest
in the trust fund proportionate to the
assets, at their fair market value,
theretofore held under such plan or in
such participating trust which are
transferred to the trust fund.
Thereafter each such plan account shall
be credited and charged as provided
above.
(b) Any provision of this agreement to the
contrary notwithstanding, each plan
account shall be held, administered, and
distributed for the exclusive benefit of
participants and their beneficiaries and
defraying the reasonable expenses of such
plan. Any reference in any plan document
to a trust or trust fund thereunder shall
be deemed to refer to such plan's plan
account and the portion of the trust fund
assets represented thereby under this
agreement or, where applicable, to such
plan's participating trust and such
participating trust's plan account, and
the portion of trust fund assets
represented thereby under this agreement.
(c) Except as may otherwise be directed
pursuant to the last sentence of this
subparagraph (c), the interest of each
plan account in the trust fund or an
investment fund thereunder shall be ac-
counted for by such method of units of
participation as shall be specified by
the Company, with the consent of the
Trustee. The Trustee shall determine, as
of the close of business on the last
business day of each month (or as of the
close of business of such other valuation
period, such as daily) or on or as of
such other time or times as may be
directed by the Company, the fair market
value of the trust fund and each
investment fund and the resulting value
of all the outstanding units of
participation therein. Transfers to and
withdrawals from the trust fund and any
investment fund shall be made on the base
of unit values so determined.
If a deposit is made to this trust in the form of assets other than
cash, the number of units of the investment fund in which such
deposit is invested shall be computed on the basis of the fair
market value of such assets as of the valuation date the deposit
is invested in such investment fund, as determined by the Trustee.
VII-4. Adjusted Net Worth. The "adjusted net worth"of an
investment fund as of any valuation date means the then fair
market value of all assets of that investment fund as of that
valuation date (before any withdrawals and before any new
investments as of that valuation date), as determined by the Trustee
pursuant to subparagraph III-2(o), less liabilities of the
investment fund, other than liabilities to participating trusts.
VII-5. Combined Investment Funds. At the discretion of the
Company the investment results of two or more investment funds
of the same type and with the same valuation dates may be
combined on a prospective basis for the purpose of allocating
such investment results. In this event, a single account shall be
maintained to reflect each participating trust's investment
therein, and units shall be valued and credited, as if the
combined funds were a single fund.
VII-6. Recordkeeping. The Trustee shall keep accurate accounts of all
investments of the trust and of receipts and disbursements and other
transactions hereunder affecting the trust. All such accounts,
and the books and records relating thereto, shall be open at all
reasonable times and under reasonable conditions to inspection
and audit by any person or persons designated by the Company,
including the Company's internal auditors, independent accounts,
counsel and actuaries, and any investment manager.
The Trustee shall establish and maintain a separate account for each
participating trust in such manner as it shall deem appropriate
to reflect the interest of each participating trust in the
trust fund at any time or from time to time. Within thirty (30) days
after the end of each month of the trust, and within thirty (30) days
following the effective date of the resignation or removal
of the Trustee, the Trustee shall render to the Company a
written account signed by the Trustee and delivered to the Company.
The account for the trust shall set forth all investments
purchased and sold, all receipts, disbursements and other transactions
effected by it during the preceding month, and the investments
(including cash) held at the end of that month with their fair
market values as of that date. With respect to all
investments purchased, sold or held, the Trustee shall set forth the
acquisition price and, if applicable, the disposition price.
Such account shall reflect transactions as of the execution or actual
settlement date, whichever is appropriate. Within 180 days
from the date of receipt of the account, the Company may file
with the Trustee either its written approval, or its written
disapproval (with the reasons therefor), of the account so
rendered. Upon the filing of such approval, or at
the expiration of that 180-day period if neitherwritten approval nor
disapproval has been filed with the Trustee, the account shall
be deemed approved, subject to paragraph IX-6. If the Company does
communicate an exception or objection, as to which it later
becomes satisfied, the Company shall thereupon indicate in
writing its approval of the account, or of the account as
amended. The Trustee shall render such other information as
the Company may reasonably direct from time to time.
VII-7. Company Stock Fund. One of the investment funds
established and maintained pursuant to paragraph V-1 shall be
invested solely in common stock of Illinois Central Corporation
(the "Company Stock Fund"). The following additional rules shall
apply to the Company Stock Fund:
(a) Shareholder rights with respect to
Company Stock attributable to a
Participant's Account shall be exercised
by the Trustee in accordance with
directions from the Participant. Each
Participant shall be entitled to direct
the Trustee with respect to the voting of
such Company Stock allocated to his
Account as of the record date of the
meeting of the stockholders of the
Company at which such Company Stock is
entitled to be voted. For purposes of
voting, units of the Company Stock Fund
will be converted by the Trustee into
whole shares of Company Stock as of the
applicable record date. The Company
shall furnish the Trustee with notices
and information statements when voting
rights are to be exercised. The Trustee
will notify Participants of each occasion
for the exercise of voting rights and
will forward copies of any proxy material
within a reasonable time after it is
secured from the Company. A Participant
shall elect to exercise his right by
filing written voting directions with the
Trustee at such time and in such form as
the Trustee may reasonably specify.
Directions received from Participants by
the Trustee shall be held in the
strictest confidence and shall not be
divulged or released to any person
including officers, directors or
employees of the Company. To the extent
not inconsistent with its fiduciary
obligations under ERISA, the Trustee
shall vote shares of Company Stock held
by it for which it does not receive
timely directions from Participants, pro
rata in accordance with the timely
directions it has received from
Participants.
(b) In the event a tender offer or exchange
offer, including but not limited to a
tender offer or exchange offer within the
meaning of the Securities Exchange Act of
1934, as from time to time amended and in
effect, (hereinafter a "Tender Offer"),
for Company Stock is commenced by a
person or persons, the functions under
the Plan applicable to the participation
of Company Stock in such Tender Offer
shall be undertaken by the Trustee at the
time the Tender Offer is commenced, and
the Company shall not undertake any
recordkeeping functions under the Plan
that would serve to violate the
confidentiality of any individual
directions given by Participants in
connection with the Tender Offer. To the
extent not inconsistent with its
fiduciary obligations under ERISA, the
Trustee shall have no discretion or
authority to sell, exchange or transfer
any of such Company Stock pursuant to
such Tender Offer except to the extent,
and only to the extent, that the Trustee
is timely directed to do so in writing as
follows:
(i) Company Stock held by the Trustee
and attributable to Accounts of
Participants shall be sold,
exchanged or transferred only to
the extent so directed in
accordance with directions it
receives from Participants.
(ii) The Trustee shall sell, exchange
or transfer shares of Company
Stock for which it does not
receive timely directions from
Participants, or that have not
been allocated to Participants'
Accounts, pro rata in accordance
with the timely directions it has
received from Participants.
(c) Dividends (whether in cash or in
property) and other income received by
the Trustee in respect of Company Stock
shall be reinvested in Company Stock and
shall constitute income and be recognized
on an accrual basis for the Accounting
Period in which occurs the record date
with respect to such dividend; provided
that, with respect to any dividend that
is reflected in the market price of the
underlying stock, the Company shall
direct the Trustee during such trading
period to trade such stock the regular
way to reflect the value of the dividend,
and all Fund transfers and cash
distributions shall be transacted
accordingly with no accrual of such
dividend, other than as reflected in such
market price.
(d) Any brokerage commissions, transfer
taxes, transaction charges, and other
charges and expenses in connection with
the purchase or sale of Company Stock
shall be added to the cost thereof in the
case of a purchase or deducted from the
proceeds thereof in the case of a sale;
provided, however, where the purchase or
sale of Company Stock is with a
"disqualified person" as defined in
Section 4975(e)(2) of the Code or a
"party in interest" as defined in Section
3(14) of ERISA, no commissions may be
charged with respect thereto.
VII-8. Accounting For Investment Funds. The investments in
each investment fund maintained pursuant to paragraph V-1,
including the Company Stock Fund, shall be maintained in full and
fractional shares or units. The Trustee is responsible for
determining the number of full and fractional shares or units of
each such fund. To the extent an investment fund is comprised of a
collective investment fund of the Trustee, the net asset and unit
values shall be determined in accordance with the rules governing
such collective investment funds, which are incorporated herein by
reference. Fees and expenses incurred for the management and
maintenance of investment funds shall be charged at the investment
fund level and reflected in the net gain or loss of each fund.
ARTICLE VIII
Deposits, Withdrawals, Transfers and Distributions
VIII-1. Deposits. A participating trust may make deposits to
this trust as of valuation dates and as of any other dates
approved by the Company. Deposits may be made by participating
trusts in cash, cash equivalents or, with the consent of the
Trustee, in securities that are listed for sale on a national or
regional securities exchange or are regularly traded in the
over-the-counter market, the fair market value of which may
be determined by the Trustee by reference to transactions
involving such securities.
VIII-2. Withdrawals, Transfers and Distributions. Withdrawals from
investment funds, transfers between investment funds and
distributions to participating trusts shall be made by the
Trustee pursuant to the direction of the Company,
subject to the following:
(a) Withdrawals from any investment fund for
the purposes described in subparagraphs
(b) and (c) next below, or for any other
purpose, shall be made on the basis of
the value of that investment fund as of
that date, as determined in accordance
with subparagraph VII-3(a).
(b) If part or all of a participating trust's
investment in any investment fund is
withdrawn for the purpose of investing
the proceeds thereof in any other
investment fund, such proceeds shall be
transferred and invested in such other
investment fund as of the valuation date
as of which the withdrawal is made.
(c) If part or all of a participating trust's
investment in any investment fund is
withdrawn for the purpose of distributing
the proceeds thereof to the participating
trust, distribution shall be made as of
the valuation date as of which the
withdrawal is made.
(d) Distributions to participating trusts as
a result of the withdrawal of any part or
all of their investments in any
investment fund shall be made by the
Trustee in cash (including payment by
check) unless the Company directs the
Trustee to make distribution in kind, or
partly in cash and partly in kind;
provided, however, that all distributions
to be made as of a valuation date as a
result of withdrawals from any single
investment fund shall be made on the same
basis. In determining equivalent
securities or other property to be
distributed in kind in lieu of cash, the
value of such securities or other
property shall be deemed to be the fair
market value thereof, as determined by
the Trustee in accordance with
subparagraph III-2(o).
(e) If upon direction of the Company a
participating trust's entire investments
in all investment funds are withdrawn and
distributed to the participating trust,
such trust shall cease to be a
participating trust as of the valuation
date as of which final distribution is
made. However, such trust again may
become a participating trust in the
manner described in paragraph VI-2.
Notwithstanding the foregoing, if the Trustee is advised or
determines that a participating trust has ceased to be a
qualified Employer plan for any reason, as soon as
practicable thereafter all investments of that participating
trust in the investment funds shall be withdrawn and the proceeds
thereof distributed to such plan. However, such withdrawal
and distribution shall be made only as of a valuation date and
on the basis of the unit value of that investment fund as
of that date, as determined in accordance with subparagraph VII-3(a).
Upon distribution of all such proceeds, such plan shall cease to be a
participating trust and may not make any additional deposits to
this trust unless it again becomes a qualified Employer plan and is
readmitted as a participating trust in accordance with paragraph
VI-2. The Trustee shall be entitled to rely, without further
inquiry, upon the Company's determination that any withdrawal,
transfer or distribution from the trust complies with this
Agreement and applicable law.
ARTICLE IX
General Provisions
IX-1. No Reversion in Employers. The Employers shall have no
right, title or interest in the trust fund, nor shall any part
of the trust fund revert or be repaid to an Employer, directly or
indirectly, unless:
(a) the Internal Revenue Service initially
determines that a participating trust,
does not meet the requirements of
Section 401(a) of the Code, in which
event the contributions made to the trust
by any Employer shall be returned to it;
(b) all liabilities under a participating
trust have been paid or provided for in
full and assets attributable to such
Employer remain in the trust fund because
of an erroneous actuarial computation, in
which event such assets remaining shall
revert and be repaid to the Employer;
(c) a contribution is made by an Employer by
mistake of fact and such contribution is
returned to the Employer within one year
after payment to the Trustee; or
(d) a contribution conditioned on the
deductibility thereof is disallowed as an
expense for federal income tax purposes
and such contribution (to the extent
disallowed) is returned to the Employer
within one year after the disallowance
of the deduction.
The amount of any contribution that may be returned to any
Employer pursuant to (c) or (d) above must be reduced by any
losses to the trust fund allocable thereto. The Trustee shall
be entitled to rely, without further inquiry, on the Company's
determination that any distribution to an Employer pursuant to this
subparagraph IX-1 satisfies the foregoing requirements and
otherwise complies with applicable law.
X-2. Non-Assignment. No participating trust's investments in
any investment funds under this trust shall be subject to
garnishment, attachment, levy or execution of any kind for the debts
or defaults of any participating trust or of any person having or
claiming to have any interest in any participating trust.
No participating trust's investment in any such investment fund
shall be assignable in whole or in part by that participating
trust or by any person having or claiming to have any interest
in that participating trust, except that the interest in this
trust held by the Trustee of a participating trustmay be
transferred to a successor Trustee of that participating trust.
IX-3. Third Parties. Except as otherwise providedby law, the
Trustee's exercise or non-exercise of its powers and discretions
in good faith shall be conclusive on all persons. No one shall
be obliged to see the application of any money paid or property
delivered to the Trustee, except to the extent such person is
acting as an investment manager as respects such money or property.
The certification of the Trustee that it is acting according to
this agreement will fully protect all persons dealing with the
Trustee.
IX-4. Liabilities Mutually Exclusive. Except as otherwise
provided by law, the Trustee, the Company, each Employer,
and each investment manager, custodian and insurance company
shall be responsible only for its or his own acts or omissions.
IX-5. Limitation of Liability. To the extent permitted by law,
no employee of the Company, no person to whom the Company
properly delegates any portion of its responsibilities under
the trust, and no person who was or is a director, officer or
employee of the Company or any corporation related to the Company,
shall have any personal liability of any nature for any act
done or omitted to be done in good faith under or in connection
with this trust.
IX-6. Limit of Responsibility. The Trustee shall be responsible
only for sums actually received by it as Trustee hereunder, and
shall be under no obligation or duty, and shall have no right
to compute any amount to be paid by it pursuant to a plan or to
collect any sums from a participating trust.
IX-7. Indemnification. To the extent permitted by law, none
of the Trustee nor any person who is or was a director,
officer, or employee of an Employer or any related corporation,
shall be personally liable for any act done or omitted to be
done in good faith in the administration of this trust or
investment of the trust funds. Any employee of an Employer to whom
the Company has delegated any portion of its responsibilities
under the plan, any person who is or was a director or officer
of an Employer or any related corporation, and each of them,
shall, to the extent permitted by law, be indemnified and saved
harmless by the Employers (to the extent not indemnified or saved
harmless under any liability insurance or other indemnification
arrangement with respect to a participating trust or this trust)
from and against any and all liability or claim of liability
to which they may be subjected by reason of any act done or
omitted to be done in good faith in connection with the
administration of a participating trust or this trust or
the investment of the trust fund, including all expenses
reasonably incurred in their defense if the Employers fail
to provide such defense after having been requested to do so in
writing. The Trustee shall be indemnified and saved
harmless by the Employers (to the extent not indemnified or
saved harmless under any liability insurance or other
indemnification arrangement with respect to a participating
trust or this trust) with respect to liability or claim of
liability to which the Trustee shall be subjected by reason
of its good faith performance of its duties hereunder or
compliance with any directions given in accordance with the
provisions of this trust by an investment manager or any
person duly authorized by the Company, or by reason of its
failure to take any action with respect to any assets of the
trust fund which are subject to investment direction from
an investment manager in the absence of direction from the in-
vestment manager, including all expenses reasonably incurred in
its defense if the Employers fail to provide such defense after
having been requested to do so in writing; except to the extent
that any claim of liability arises from the Trustee's own neg-
ligence, misconduct or breach of its duties under this trust or
applicable law.
IX-8. Disagreement as to Acts. If there is a disagreement
between the Trustee and anyone as to any act or transaction
reported in any accounting by the Trustee, the Trustee shall
have a right to a settlement of any such disagreement by
appropriate action instituted in any court having jurisdiction.
IX-9. Courts. Except as otherwise provided by law, in case of
any court proceeding involving a participating trust, this trust,
the Trustee of any such trust or the Company, only the participating
trust, this trust, such Trustee or the Company shall be necessary
parties to the proceedings, proceedings, no other person or entity
shall be entitled to notice of process, and a final judgment
entered in any such proceedings shall be conclusive.
IX-10. Unrelated Business Taxable Income. The Trustee shall not
invest the trust in such a manner as to create unrelated
business taxable income (as defined in Section 512 of the Code)
to the trust or any participating trust.
IX-11. Evidence. Evidence required of anyone under this agreement
may be by certificate, affidavit, document or other information
which the person acting on it considers pertinent and reliable,
and signed, made or presented by the proper party or parties.
IX-12. Mistake of Fact. Any misstatement or any mistake of fact
in any certificate, notice or other document filed with the
Company, the Trustee or any investment manager shall be
corrected when it becomes known and the Company, the Trustee
or the investment manager, as the case may be, shall make such
adjustment on account thereof as is considered equitable and
practicable.
IX-13. Attorneys, Agents, Accountants, etc. In order to
facilitate the administration of this trust:
(a) Each of the Company and the Trustee may
employ such agents, attorneys,
accountants or other persons (who also
may be employed by the Company or others)
as in its opinion may be necessary or
desirable to carry out its duties under
this agreement, may pay them a reasonable
compensation, and may allocate or
delegate to them such powers, rights and
duties as the Company or the Trustee may
consider necessary or desirable to
properly carry out his or its duties
under the plan or this agreement (other
than Trustee responsibilities as to
management or control of assets of the
trust fund); provided that such allocation
or delegation, and the acceptance thereof by
such agents, attorneys, accountants or other
persons, shall be in writing.
(b) Subject to applicable law, each of the
Company and the Trustee may act or
refrain from acting on the advice or
opinion of reputable agents, attorneys,
accountants or other persons selected as
above with reasonable diligence and
without liability for so doing and
without court action.
IX-14. Compensation and Expenses. The Trustee, with the prior
written consent of the Company, may pay from the trust fund all
expenses reasonably incurred in the administration of the trust
fund. In addition, the Company may direct the Trustee to pay
from the trust fund reasonable expenses incurred by an Employer
or the Company in carrying out their responsibilities under
this agreement.
(a) The Trustee is entitled to rely on the
Company's written instructions regarding
the payment of such expenses, and will
not be liable for complying with them.
The Trustee shall notify the Company in
periodic written reports of all expenses
paid from the trust fund. Nothing herein
prohibits the Employer from reimbursing
the trust fund for such expenses.
(b) Any amount deducted and charged against
the trust fund which is specifically
allocable to a particular investment
account or participating trust shall be
charged against the interest of that
account or trust in the trust fund. Any
amount deducted and charged against the
trust fund which is not allocable to a
particular investment account or
participating trust shall be allocated
among all of the investment accounts and
participating trusts in proportion
to their interests in the trust fund by
such equitable method or methods of
allocation as the Trustee shall adopt and
consistently follow from time to time, or
as shall be specified by the Company.
(c) Such administrative costs and expenses
shall include, but shall not be limited
to, reasonable compensation to agents,
attorneys, actuaries, accountants and
other persons employed by the Trustee
(with the consent of the Company) or the
Company, reimbursement to the Employers
for plan administrative costs such as
premiums paid to the Pension Benefit
Guaranty Corporation, printing costs,
audit fees, and other expenses incurred
in complying with reporting and
disclosure requirements and reimbursement
for reasonable compensation paid to
employees of the Employers and other
employment costs paid by the Employers
attributable to services such employees
render pursuant to duties and
responsibilities delegated to them by the
Company with respect to the
administration of this trust or any
participating trust or any plan relating
to any such participating trust.
The Trustee is entitled to withdraw from the trust fund reasonable
compensation for its services, with the prior written consent
of the Company. The amount of the Trustee's compensation will
be agreed upon from time to time by the Company and the Trustee and
included in a schedule separate from this agreement. The Company
may agree with the Trustee that Trustee compensation will be paid
by the Employers. In such case, the Trustee will be entitled to
withdraw its compensation from the trust fund only if the
Employers fail to pay the Trustee within 45 days after the Trustee
sends an appropriate billing to the Company.
IX-15. Action by the Company. Any action required or permitted
to be taken under this agreement by the Company shall be by
resolution of its Board of Directors, by a duly authorized
committee of its Board of Directors, or by a person or persons
authorized by resolution of its Board of Directors or such
committee.
IX-16. Waiver of Notice. Any notice required under this agreement
may be waived by the person entitled to such notice.
IX-17. Gender and Number. Where the context admits, words in
the masculine gender shall include the feminine and neuter
genders, the plural shall include the singular, and the
singular shall include the plural.
IX-18. Counterparts. This agreement may be executed in two or
more counterparts, any one of which shall constitute an
original without reference to the others.
IX-19. Statutory References. Any reference in this agreement
to the Internal Revenue Code means the Internal Revenue Code
of 1986, any reference to "ERISA" means the Employee
Retirement Income Security Act of 1974, and any reference to a
section of the Code or of ERISA shall include any comparable section
or sections of any future legislation that amends, supplements
or supersedes said section.
IX-20. Severability. In case any provisions of this agreement
shall be held illegal or invalid for any reason, such illegality
or invalidity shall not affect the remaining provisions of
this agreement and this agreement shall be construed and
enforced as if such illegal or invalid provision had never been set
forth in this agreement.
IX-21. Scope of this Agreement. This agreement shall be binding
upon the Employers, their successors and assigns, and upon the
Trustee, the Company, the investment managers, custodians and
their successors and assigns.
IX-22. Confidentiality. The Trustee shall maintain the strictest
confidence regarding the business affairs of the Employers,
the Company and the trust. Written reports furnished by
the Trustee to the Employers or the Company and any information
furnished by the Employers or the Company to the Trustee shall
be treated by the Trustee as confidential and for the exclusive
use and benefit of the Employers or the Company except as
disclosure may be required by applicable law.
IX-23. Contesting of Assessed Taxes. If any taxes are assessed
on or in respect to the trust fund and any income therefrom,
the Trustee shall advise the Company in writing within
five (5) business days of the Trustee's receipt of such
assessment. If the Trustee is not notified otherwise by the Company,
within sixty (60) days from the date of its notice to the Company,
it may assume that any taxes so assessed are lawfully assessed
after such 60 day period. The Trustee, if so instructed by the
Company shall contest the validity of such taxes in any manner
deemed appropriate by the Company or its counsel. The term
"taxes" include any interest or penalties that may be levied
or imposed in respect of any taxes assessed.
IX-24. Form of Instructions. All directions, notices,
instructions and consents given by the Company to the
Trustee and vice versa shall be in writing and be given in
any manner which is agreeable to such parties, and the
Trustee or the Company, as the case may be, shall act in
accordance therewith.
IX-25. Notices. All notices, consents and other instruments
given pursuant to this Agreement shall be in writing and
shall validly be given when hand delivered or mailed by
certified mail, return receipt requested.
ARTICLE X
Changes in Trustee
X-1. Resignation. The Trustee may resign at any time by
giving sixty days' prior written notice to the Company. The
Company shall give prompt written notice of the Trustee's
resignation to the investment managers, custodians, insurance
companies and other Employers. The Company shall promptly
appoint a successor Trustee, and if no successor has been
appointed by the effective date of the Trustee's resignation,
the Trustee may petition a court of competent jurisdiction to
appoint a successor Trustee.
X-2. Removal of Trustee. The Company may remove the Trustee
at any time by written notice to the Trustee and the other
Employers. The Company shall fill any vacancy in the office
of Trustee as soon as practicable and shall give prompt
written notice thereof to the investment managers, custodians,
insurance companies and the other Employers.
X-3. Duties of Resigning or Removed Trustee and of Successor
Trustee. A Trustee that resigns or is removed shall promptly
furnish to the Company and the successor Trustee an account of its
administration of the trust from the date of its last account. Each
successor Trustee shall succeed to the title to the trust fund
vested in its predecessor without the signing or filing of any further
instrument, but each resigning or removed Trustee shall execute all
documents and do all acts necessary to vest such title of record in
the successor Trustee. Each successor Trustee shall have and
enjoy all of the powers conferred by this agreement as if
originally named Trustee. Subject to applicable law, no successor
Trustee shall be personally liable for any act or failure to act
of any predecessor Trustee and with the approval of the Company
a successor Trustee may accept the account rendered and the
property delivered to it by a predecessor Trustee as a full and
complete discharge to the predecessor Trustee without incurring
any liability or responsibility for so doing.
ARTICLE XI
Amendment and Termination
XI-1. Amendment. This agreement may be amended from time to
time by the Company, with the consent of the Trustee, except that
under no condition shall any amendment result in or permit the
payment to any Employer of any portion of the trust fund or
the income therefrom, or result in or permit the distribution of
the trust fund for the benefit of anyone other than beneficiaries
of participating trusts. To the extent that the Company deems it
necessary or desirable to do so, the Company may amend Article XII
of this agreement to incorporate therein and make a part of this
agreement the terms and provisions of the documents under which any
fund described in Article XII is maintained; provided, however,
that any such amendment shall be subject to the limitations set
forth above.
XI-2. Termination. The Company may terminate this trust by
giving written notice of the termination to the Trustee and the other
Employers. The Company shall give prompt written notice of the
termination to the investment managers, custodians and insurance
companies and to the Trustee of each participating trust.
No further deposits shall be made to this trust after its
termination. The participating trusts' investments in all investment
funds shall be withdrawn by the Trustee upon the direction of
the Company on or as soon as practicable after the termination
of this trust and the proceeds of each participating trust's
investments shall be distributed to it. The date on which
such withdrawals are made shall be treated as a valuation date
for the purpose of effecting such withdrawals and distributions.
ARTICLE XII
Incorporation of Collective Investment Trusts
Notwithstanding any other provisions of this agreement, the Trustee,
the Company, or any investment manager may cause any part or all of
the trust assets for which it has investment responsibility to be
invested in any common, collective or commingled trust fund or pooled
investment fund that is qualified under Section 401(a), and entitled
to tax exemption under Section 501(a), of the Code and is
maintained by the bank acting as Trustee, by any other bank or trust
company supervised by a state or federal agency, or by the Trustees
under such fund. To the extent trust assets are invested in any
such common, collective or commingled trust fund or pooled
investment fund, the provisions of the documents under which such
fund is maintained, as amended from time to time, shall govern
any investment therein, and such provisions are hereby incorporated
herein and made a part of this agreement.
IN WITNESS WHEREOF, the Company and the Trustee have caused this
agreement to be executed on their behalf by their respective
officers thereunto duly authorized, the day and year first
above written.
ILLINOIS CENTRAL RAILROAD CONTINENTAL TRUST COMPANY
COMPANY
By By
Its Its
(Corporate Seal) (Corporate Seal)
Exhibit 5
July 18, 1995
ILLINOIS CENTRAL CORPORATION
455 N. Cityfront Plaza Drive
Chicago, Illinois 60611-5504
Gentlemen:
I have examined the corporate and plan records and proceedings
of Illinois Central Corporation (the "Company") and the Illinois
Central Railroad Company Union Employees' Savings Plan (the "Plan") with
respect to the shares of common stock of the Company (the "Shares") being
registered with the Securities and Exchange Commission pursuant to the
Company's registration statement on Form S-8 (the "Registration
Statement").
I am of the opinion that the Shares, when issued under and in
accordance with the Plan, will be legally issued, fully paid and
non-assessable.
I hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the references to this
opinion contained in the Registration Statement.
Very truly yours,
/s/Ronald A. Lane
Vice President and General
Counsel of the Company
Exhibit 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this Form S-8 Registration Statement of our
report dated January 17, 1995, included in Illinois Central Corporation's
Annual Report on Form 10-K for the year ended December 31, 1994, and to
all references to our Firm included in this Registration Statement.
/s/ARTHUR ANDERSEN LLP
Chicago, Illinois
July 18, 1995
