Exhibit 4.1
AGREEMENT CONCERNING
TAX-EFFICIENT SAVINGS PLAN
FOR HOURLY EMPLOYEES
AND
FORD MOTOR COMPANY
TAX-EFFICIENT SAVINGS PLAN
FOR HOURLY EMPLOYEES
On this 15th day of September, 2003 , at Dearborn, Michigan, Ford Motor Company,
a Delaware corporation, hereinafter designated as the Company, and the
International Union, United Automobile, Aerospace and Agricultural Implement
Workers of America, UAW, an unincorporated voluntary association, hereinafter
designated as the Union, agree as follows:
AGREEMENT CONCERNING
TAX-EFFICIENT SAVINGS PLAN
FOR HOURLY EMPLOYEES AGREEMENT
CONCERNING TAX-EFFICIENT SAVINGS PLAN FOR
HOURLY EMPLOYEES
Section 1 . Continuation of Plan
Subject to the approval of the Company's Board of Directors and receipt by
the Company of approval by the Internal Revenue Service as meeting the
requirements of Sections 401(a) and 401(k) of the Internal Revenue Code, the
Company will continue the Tax-Efficient Savings Plan for Hourly Employees
(hereinafter referred to as the Plan) in the form that has been agreed to by
the parties, effective, except as otherwise provided in the Plan, January 1,
1997. In the event that an Internal Revenue Service ruling acceptable to the
Company is not obtained, the Company, within 30 days after such disapproval,
will give written notice thereof to the Union and this Agreement shall
thereupon have no force or effect. In that event, the matters covered by
this Agreement shall be the subject of further negotiation between the
Company and the Union with respect to adopting a program adhering as closely
as possible to the language and intent of the provisions outlined in the
Plan for which a favorable ruling may be obtained.
Section 2 . Administration
The Plan will be maintained under provisions of Sections 401(a) and 401(k)
of the Internal Revenue Code of l986, as amended. In the event of any
conflict between the provisions of the Plan and the provisions of the
Agreement, the provisions of this Agreement will supersede the provisions of
the Plan to the extent necessary to eliminate such conflict.
Section 3 . Obligations During Term of This Agreement
During the term of this Agreement, neither the Company nor the Union shall
request any change, deletion from or addition to the Plan or this Agreement,
except as required to maintain qualification of the Plan under Sections
401(a) and 401(k) of the Internal Revenue Code, and for compliance with
ERISA and any other legislation governing such plans, or be required to
bargain with respect to any provision or interpretation of the Plan or this
Agreement; and during such period no change in, deletion from or addition to
any provision, or interpretation, of the Plan or this Agreement, nor any
dispute or difference occurring in any negotiations pursuant to Section 1 of
this Agreement shall be an objective of, or a reason or cause for, any
action or failure to act, including without limitation, any strike,
slowdown, work stoppage, lockout, picketing or other exercise of economic
force, or threat thereof, by the Union or the Company.
Section 4 . Nonapplicability of Collective Bargaining Agreement Grievance
Procedure
No matter respecting the Plan as supplemented by this Agreement or any
difference arising thereunder shall be subject to the Grievance Procedure
established in the Collective Bargaining Agreement between the Company and
the Union.
Section 5 . Term of Agreement; Notice to Modify or Terminate
The Plan as amended will, except as otherwise provided in the Plan, be
effective January 1, 1997, and this Agreement and the Plan will continue in
effect until the termination of the Collective Bargaining Agreement dated
September 15, 2003 between the Company and the Union. The Plan shall be
renewed automatically for successive one-year periods thereafter unless
either party shall give written notice to the other at least 60 days prior
to September 14, 2007, (or any subsequent anniversary date) of its desire
to amend or modify the Plan as of one of the dates specified in this Section
(it being understood, however, that the foregoing provision for automatic
one-year renewal periods shall not be construed as an endorsement by either
party of the proposition that one year is a suitable term for such a Plan).
If such notice is given, the Plan shall be open to modification or amendment
on September 14, 2007, or the subsequent anniversary date, as the case may
be.
If either party shall desire to terminate this Agreement, it may do so on
September 14, 2007, or any subsequent anniversary date, by giving written
notice to the other party at least 60 days prior to the date involved.
Anything herein which might be construed to the contrary notwithstanding,
however, it is understood that termination of this Agreement shall not have
the effect of automatically terminating the Plan.
Notwithstanding termination of this Agreement and the Plan, any profit
sharing distributions pursuant to the Ford Motor Company Profit Sharing Plan
for Hourly Employees in the United States that otherwise would be
contributed to the trust fund under this Plan with respect to calendar year
2007 shall be contributed and administered in accordance with the provisions
of this Agreement and the Plan.
Any notice under this Agreement shall be in writing and shall be
sufficient, if sent by mail addressed, if to the Union, to International
Union, UAW, 0000 Xxxx Xxxxxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx 00000, or to such
other address as the Union shall furnish to the Company in writing, and if
to the Company, to Ford Motor Company, Dearborn, Michigan 48121, Attention:
Vice President-Human Resources, or to such other address as the Company
shall furnish to the Union, in writing.
IN WITNESS WHEREOF, this Agreement is executed on behalf of each party by its
duly authorized representatives as of the date first appearing above.
FORD MOTOR COMPANY
Xxxxxxx Xxxx Xxxx, Xx.
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Xxxxx xx Xxxxx
UAW
International Union
National Ford Council
Xxx Xxxxxxxxxxxx
Xxxx Xxxxxxx, Subcouncil #6
Xxxxxx X. Xxxxxx
Xxxx Xxxxxxxxxx, Subcouncils #2 & #3
Xxxxxxx Xxxxxxx
Xxxx Xxxxxx, Subcouncil #1
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Xxxxxx Xxxxx, Subcouncil #1
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Xxxxx Xxx, Subcouncil #2
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Xxxxx Xxxxxx, Subcouncil #3
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Xxxxxx Xxxxxx, Subcouncil #5
Xxx Xxxxxx, Subcouncil #6
Xxxxxx Xxxxxxx, Subcouncil #7
FORD MOTOR COMPANY TAX-EFFICIENT SAVINGS
PLAN FOR HOURLY EMPLOYEES TAX-EFFICIENT
SAVINGS PLAN FOR HOURLY EMPLOYEES
This Plan has been established by the Company to enable employees to save and
invest in a systematic manner and to provide them with an opportunity to become
stockholders of the Company.
I. Definitions
As hereinafter used:
1. "Account" shall mean, as appropriate, any one of a Member's
Tax-Efficient Savings Account, After-Tax Savings Account, or any
combination of such accounts.
2. "After-Tax Savings Contributions" shall mean amounts contributed by an
Employee to the Plan from the Employee's Wages, as provided in
Paragraph IV hereof.
3. "After-Tax Savings Account" shall mean an Account of a Member under
the Plan to which are credited After-Tax Contributions made by such
Employee and Earnings thereon.
4. "Bond Index Fund" shall mean that portion of the trust fund under the
Plan consisting of investments made by the Trustee in accordance with
Subparagraph 3 of Paragraph XIII hereof.
5. "Bond Index Fund Units" shall mean the measure of a member's interest
in the Bond Fund as described in Subparagraph 3 of Paragraph XIII
hereof.
6. "Cash value of assets" shall mean the value of the assets, expressed
in dollars, in a member's account under any investment election under
the Plan or the total thereof, as the case may be, at the close of
business on the date such cash value is to be determined.
7. "Catch-Up Contributions" shall mean amounts contributed by an Employee
to the Plan from the Employee's paycheck as provided in Subparagraph 2
of Paragraph IV hereof.
8. "Code" shall mean the Internal Revenue Code of 1986, as amended.
9. "Collective Bargaining Agreement" shall mean the Collective Bargaining
Agreement dated September 15, 2003 between the Company and the
International Union, United Automobile, Aerospace and Agricultural
Implement Workers of America, UAW.
10. "Committee" shall mean the Committee created by the Company pursuant
to the provisions of Paragraph XX hereof.
11. "Common Stock Index Fund" shall mean that portion of the trust fund
under the Plan consisting of investments made by the Trustee in
accordance with Subparagraph 2 of Paragraph XIII hereof.
12. "Common Stock Index Fund Units" shall mean the measure of a member's
interest in the Common Stock Fund as described in Subparagraph 2 of
Paragraph XIII hereof.
13. "Company" shall mean Ford Motor Company.
14. "Company stock" shall mean Common Stock of the Company.
15. "Composite Quotation Listing" shall mean a composite listing of market
prices of securities supplied by a reputable financial statistical
service selected by the Trustee, which listing includes the prices at
which securities are traded on national securities exchanges located
in the United States.
16. "Current market value" shall mean, with reference to Company stock,
the closing market price on the New York Stock Exchange on the day in
question or, if no sales were made
on that date, at the closing market price on the next preceding day on
which sales were made.
17. "Earnings", with reference to Tax-Efficient Savings Contributions and
After-Tax Savings Contributions, shall mean earnings resulting from
the investment and any reinvestment of such contributions and any
increment thereof and shall include interest, dividends and other
distributions on such investments.
18. "Employee" shall mean each person who is employed at an hourly rate by
a Participating Company and is enrolled on the active employment rolls
of such Participating Company maintained in the United States.
19. "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
20. "Ford Stock Fund" shall mean that portion of the trust fund under the
Plan consisting of investments made by the Trustee in accordance with
Subparagraph 1 of Paragraph XIII hereof.
21. "Ford Stock Fund Units" shall mean the measure of a member's interest
in the Ford Stock Fund as described in Subparagraph 1 of Paragraph
XIII hereof.
22. "Interest Income Fund" shall mean that portion of the trust fund under
the Plan consisting of investments made by the Trustee in accordance
with Subparagraph 4 of Paragraph XIII hereof.
23. "Interest Income Fund Advisor" shall mean one or more persons or
companies, corporations, or other organizations appointed by the
Company to provide investment advice to the Trustee concerning the
Interest Income Fund. The Trustee may be designated an Interest Income
Fund Advisor by the Company.
24. "Member" shall mean and include (a) an employee who shall have elected
to participate in the Plan and, in the case of an employee of a
Participating Company, shall have filed a Tax-Efficient Savings
agreement then outstanding under the Plan, and (b) a person who has
assets under the Plan.
25. "Participating Company" shall mean and include the Company, AAI
Employee Services Company, L.L.C., and each Subsidiary of the Company
that shall have elected to participate in the Plan with the consent of
the Company. "Subsidiary of the Company" shall mean a domestic
corporation not less than a majority of the voting stock of which is
owned directly or indirectly by the Company.
26. "Performance Bonus Payments" shall mean payments to members pursuant
to Article IX, Section 2 (b)(1) of the Collective Bargaining
Agreement.
27. "Plan year" shall mean, prior to the Plan Year beginning in December
1999, a twelve-month period starting on the first day of the first pay
period beginning in a calendar year and ending on the last day of the
last pay period beginning in such calendar year. Notwithstanding the
foregoing, the 1999 Plan Year shall end on December 30, 1999.
Thereafter, the Plan Year shall be a twelve-month period beginning
December 31 and ending the following December 30.
28. "Profit sharing distributions" shall mean amounts distributed to
hourly employees under profit sharing plans of a Participating
Company.
29. "Subsidiary" or "Affiliate" shall mean (a) all corporations that are
members of a controlled group of corporations within the meaning of
Section 1563(a) of the Internal Revenue Code (determined with-out
regard to Section 1563(a)(4) and Section 1563(e)(3)(c) of the Internal
Revenue Code) and of which the Company is then a member and (b) all
trades or businesses, whether or not incorporated, that, under the
regulations prescribed by the Secretary of the Treasury pursuant to
Section 414(c) of the Internal Revenue Code, are then under common
control with the Company.
30. "Tax-Efficient Savings account" shall mean an account of a member
under the Plan to which are credited Tax-Efficient Savings
Contributions on behalf of such employee and earnings thereon.
31. "Tax-Efficient Savings election" shall mean an agreement between an
employee and the Participating Company to have the employee's wages or
profit sharing distributions reduced by an amount specified by the
employee and to have an amount equal to such reduction contributed by
the Participating Company to the Plan on behalf of the employee,
pursuant to Section 401(k) of the Internal Revenue Code and Paragraph
IV hereof.
32. "Tax-Efficient Savings Contributions" shall mean amounts contributed
by the Company to the Plan on behalf of an employee, pursuant to a
Tax-Efficient Savings agreement, as provided in Paragraph IV hereof.
33. "Trustee" shall mean the trustee or trustees appointed by the Company
pursuant to the provisions of Paragraph XVI hereof.
34. "Wages" shall mean the regular base pay for straight time hours,
including holiday pay and vacation pay (including the related excused
absence allowance), and incentive pay, bereavement pay, jury duty pay,
and short-term military duty pay, and the straight time portion of any
overtime hours paid, up to a total of 40 hours in a week for all such
payments, cost of living allowance applicable to the foregoing, and
Performance Bonus Payments to which an employee of a Participating
Company is entitled prior to giving effect to any Tax-Efficient
Savings election. Performance Bonus payments shall qualify as wages
irrespective of the 40 hour maximum. "Wages" shall not include any
other category of compensation (e.g., overtime premium pay, Saturday
and Sunday premium pay, cost-of-living allowance not applicable to the
foregoing, call-in pay, shift premium pay, seven-day premium pay,
holiday premium pay, grievance awards, moving allowances,
supplemental unemployment benefit payments under the Company's
Supplemental Unemployment Benefit Plan (including automatic short-week
benefit payments), suggestion awards, tool allowances, apprentice
training incentives, the cost to the Participating Company of
providing Group Life Insurance and Survivor Income Benefit coverages
in excess of $50,000 (or any other imputed income as may be designated
by law), pension or retirement plan payments, any Christmas bonus, or
any other special remuneration).
In addition, effective January 1, 1995, wages for purposes of
determining the amount of contributions that may be made to the Plan
by employees whose regularly scheduled hours are less than 40 hours as
a result of the establishment of a three-shift operation at the
discretion of the Company shall be determined by
(i) multiplying the excess of 40 hours over the regularly
scheduled hours by a rate equal to the sum of the regular
straight-time rate and the applicable cost-of-living
allowance and
(ii) adding thereto straight-time pay and applicable
cost-of-living allowance for hours worked,
up to a total of 40 hours in a week for all such payments.
For years beginning after December 31, 1988, the annual
compensation of each employee taken into account for determining
all benefits provided under the Plan for any determination period
shall not exceed the amount specified in Section 401(a)(17) of
the Internal Revenue Code.
II. Eligibility
Except as hereinafter provided, each employee of a Participating
Company shall be eligible for membership in the Plan and to make After-Tax
Savings Contributions and to have Tax-Efficient Savings Contributions made
to the Plan three months after such employee's initial date of hire
(eligibility date).
The Company may in its discretion determine, in the event of the
acquisition by a Participating Company (by purchase, merger or otherwise)
of all or part of the assets of another corporation, that the service of a
person as an employee of such other corporation shall be included in
ascertaining whether he or she has had such service as required above for
eligibility, provided that he or she shall have become an employee of a
Participating Company in connection with such acquisition.
Leased employees are not considered employees and are therefore excluded
from eligibility for membership in the Plan. The term "leased employee"
includes any person (other than an employee of the Company) who pursuant to
an agreement between the Company and any other person ("leasing
organization") has performed services for the Company (or for the Company
and related persons determined in accordance with Section 414(n)(6)of the
Internal
Revenue Code) on a substantially full time basis for a period of at least
one year, and such services are performed under primary direction or control
by the Company. For purposes of this subparagraph, the term Company shall
include the Company and its subsidiaries.
III. Membership
Membership of any employee in the Plan shall be entirely voluntary except as
otherwise provided in Paragraph XXVI hereof.
An eligible employee may elect membership in the Plan as of any pay period
commencing after such employee's eligibility date or as of the date of any
profit sharing distribution by delivering a notice of election to
participate and a Tax-Efficient Savings election in accordance with
Paragraph IV hereunder.
A newly-hired employee of a Participating Company may elect membership in
the Plan prior to the date on which such employee would otherwise become
eligible for membership in the Plan for the limited purpose of making a
rollover contribution to the Plan as hereinafter provided.
IV. Contributions
1. Tax-Efficient Savings Contributions
Each eligible employee, by making a Tax-Efficient Savings election in
such form and in such manner and at such time as the Committee may
prescribe, may elect to have contributed to the Plan on his or her
behalf
(a) for each pay period, a Tax-Efficient Savings Contribution in such
amount as he or she may authorize at a rate of not less than one
percent nor more than twenty (20) percent for the period following
the first pay period after January 1, 1997 through the first pay
period after January 1, 1998, twenty-five (25) percent through
March 31, 2002, forty (40) percent from April 1, 2002 through the
end of the pay period including March 31, 2004, and fifty (50)
percent following the first pay period after April 1, 2004 and
thereafter in increments of one percent, of his or her wages for
such pay period, such amounts to be rounded down to the nearest
full dollar, and
(b) for each profit sharing distribution, a Tax-Efficient Savings
Contribution in such amount as he or she may authorize at a rate of
not less than one percent nor more than 100 percent, in increments
of one percent, of such profit sharing distribution.
Subject to the foregoing provisions of this paragraph IV, the rate of
Tax-Efficient Savings Contributions with respect to wages authorized
by the employee may be decreased, increased or stopped by him or her
by delivering notice of such change in such form and in such manner
and at such time as the Committee shall specify. If an employee shall
become ineligible to have Tax-Efficient Savings Contributions made to
the Plan, his or her Tax-Efficient Savings election shall terminate
forthwith. If the Tax-Efficient Savings election of an employee shall
terminate for any reason, the employee thereafter may, subject to the
eligibility provisions of the Plan, resume the making of Tax-Efficient
Savings Contributions to the Plan, as of the first day of any pay
period by giving notice in such form and in such manner and at such
time as the Committee shall specify.
The Company shall contribute to the Plan each pay period, out of
current or accumulated earnings and profits, an amount equal to the
aggregate of the amounts of Tax-Efficient Savings Contributions to be
contributed by the Company on behalf of employees pursuant to such
employees' elections under Tax-Efficient Savings agreements with
respect to such pay period.
2. Catch-Up Contributions
For Plan Years commencing December 31, 2001 and thereafter, all
members who are eligible to make Tax-Efficient Savings Contributions
and who have attained age 50 before the close of the Plan Year shall
be eligible to make Catch-Up Contributions in accordance with, and
subject to the limitations of Section 414(v) of the Code. Such
Catch-Up Contributions shall not be taken into account for purposes of
the provisions of the Plan implementing the required limitations of
Section 402(g) and 415 of the Code. The Plan shall not be treated as
failing to satisfy the provisions of the Plan implementing the
requirements of Section 401(k)(3), 401(k)(11), 401(k)(12), 410(b)
or 416 of the Code, as applicable, by reason of the making of such
Catch-Up Contributions. Each eligible employee, by delivering notice
in such form and in such manner and at such time as the Committee
shall specify, may elect to have Company contributions allocated on
his or her behalf as Catch-Up Contributions for each pay period not in
excess of fifty (50) percent of his or her wage for such pay period
designated in whole percentage amount of wage.
The rate of Catch-Up Contributions with respect to wages authorized by
the employee may be decreased, increased or stopped by him or her by
delivering notice of such change in such form and in such manner and
at such time as the Committee shall specify. If the Catch-Up
Contribution election of an employee shall terminate for any reasons,
the employee thereafter may, subject to the eligibility provisions of
the Plan, resume the making of Catch-Up Contributions to the Plan.
3. After-Tax Savings Contributions
Beginning January 1, 2000, or as soon as practicable thereafter, in
lieu of all or part of the contributions an employee may authorize
in accordance with Subparagraph 1 of Paragraph IV, an employee may
elect in the manner prescribed by the Committee to contribute an
equivalent amount to the Plan on an after-tax basis. Such
contributions shall be allocated to the employee's After-Tax Savings
Account.
The Committee may require employees of a Participating Company who
elect to make After-Tax Savings Contributions to the Plan to
contribute by payroll deductions or by such other method as the
Committee may designate. If the Committee shall designate a method
other than payroll deductions, the Committee shall adopt rules
applying, as nearly as practicable, the provisions of this Paragraph
IV relating to payroll deductions to such method of making After-Tax
Savings Contributions.
4. Limitation on Contributions
(a) Definitions. As hereinafter used in this Paragraph IV:
"Average Tax-Efficient Savings Contribution percentage" means the
average of the Tax-Efficient Savings Contribution percentages of the
eligible employees in a group.
"Tax-Efficient Savings Contribution percentage" means the ratio
(expressed as a percentage) of Tax-Efficient Savings Contributions
under the Plan on behalf of the eligible employee for the year to the
eligible employee's compensation for the year. "Compensation" for
this purpose means compensation paid by the Company to the employee
during the year which is required to be reported as wages on the
employee's Form W-2, plus Tax-Efficient Savings Contributions. The
determination of the Tax-Efficient Savings Contribution percentage
and the treatment of Tax-Efficient Savings Contributions shall
satisfy such other requirements as may be prescribed by the Secretary
of the Treasury pursuant to the Internal Revenue Code.
The Tax-Efficient Savings Contribution percentage for any eligible
employee who is a highly compensated employee for the year and who is
eligible to have Tax-Efficient Savings Contributions allocated to his
or her account under two or more plans described in Section 40l(a) of
the Internal Revenue Code or arrangements described in Section 40l(k)
of the Internal Revenue Code that are maintained by the Company or an
Affiliate shall be determined as if all such contributions were made
under a single plan.
"Average After-Tax Contribution percentage" means the average of the
After-Tax Savings Contribution percentages of the eligible employees
in a group.
"After-Tax Contribution percentage" means the ratio (expressed as a
percentage) of After-Tax Savings Contributions under the Plan on
behalf of the eligible employee for the year to the eligible
employee's compensation for the year. "Compensation" for this purpose
means compensation paid by the Company to the employee during the
year which is required to be reported as wages on the employee's Form
W-2, plus Tax-Efficient Savings Contributions. The determination of
the After-Tax Contribution percentage and the treatment of After-Tax
Savings Contributions shall satisfy such other requirements as may be
prescribed by the Secretary of the Treasury pursuant to the Internal
Revenue Code. The After-Tax Contribution
Percentage for any eligible employee who is a highly compensated
employee for the year and who is eligible to make After-Tax Savings
Contributions to his or her accounts under two or more plans
described in Section 401(a) of the Internal Revenue Code or
arrangements described in Section 401(m) of the Internal Revenue Code
that are maintained by the Company or an Affiliate shall be
determined as if all such contributions were made under a single
plan.
The term "highly compensated employee" includes highly compensated
active employees and highly compensated former employees.
A highly compensated active employee includes any employee who
performs service for the Company and who (i) was a 5 percent owner
at any time during the look-back year or determination year, which
terms are defined below, or (ii) for the look-back year, received
compensation from the Company in excess of $80,000 (as adjusted
pursuant to the Internal Revenue Code).
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.
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 Company during the
determination year, and was a highly compensated active employee for
either the separation year or any determination year ending on or
after the employee's 55th birthday.
The determination of who is a highly compensated employee, including
the determinations of the number and identity of employees in the
top-paid group, and the compensation that is considered, will be made
in accordance with Section 414(q) of the Internal Revenue Code and
the regulations thereunder. For this purpose, for the Plan Year
beginning in 1997, "compensation" shall mean compensation within the
meaning of Section 415(c)(3) of the Internal Revenue Code determined
without regard to Section 402(e)(3) and 402(h)(l)(B) of the Internal
Revenue Code, and for Plan Years beginning after January 1, 1998,
shall mean compensation as defined in Section 415(c)(3) of the
Internal Revenue Code. For limitation years beginning on and after
January 1, 2001, for purposes of applying the limitations described
in Article XXV of the Plan, compensation paid or made available
during such limitation years shall include elective amounts that are
not includible in the gross income of the employee by reason of
Section 132(f)(4) of the Code.
(b) Limits on Tax-Efficient Savings Contributions
The total amount of Tax-Efficient Savings Contributions allowable
under Tax-Efficient Savings elections for any employee for any year
beginning on or after January l, l988 shall not exceed the lesser of
1) prior to January 1, 2000, $7,000
multiplied by the cost-of-living adjustment factor prescribed by the
Secretary of the Treasury under Section 4l5(d) of the Internal Revenue
Code and after January 1, 2000, the maximum allowed by Sections 401(a)
(30) and 402(g) of the C ode as from time to time in effect or as
provided by any successor provisions; or 2) twenty (20) percent for the
period following the first pay period after January 1, 1997 through the
first pay period after January 1, 1998, twenty-five (25) percent
through March 31, 2002, forty (40) percent from April 1, 2002 through
the end of the pay period including March 31, 2004, and fifty (50)
percent following the first pay period after April 1, 2004 and
thereafter of the employee's wages for that year plus 100 percent of
the profit sharing distributions payable to the employee during that
year.
(c) Limitations on Tax-Efficient Savings Contributions Applicable to Highly
Compensated Employees
For each employee who is a highly compensated employee for the year the
total amount of Tax-Efficient Savings Contributions available shall not
exceed the percent of the employee's wages and profit sharing distributions
for the year determined as follows. There first shall be determined, under
the following table, an average allowable tax-efficient savings percentage,
for the eligible employees who are not highly compensated employees for the
year as a group.
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If the average of the actual
Tax-Efficient Savings The allowable average
Contribution percentages of Tax-Efficient Savings
eligible employees who are Contribution percentage for eligible
not highly compensated employees
employees for the preceding who are highly
Plan Year (or if the Company compensated employees
amends the Plan to elect shall not exceed:
the Current Plan Year) is:
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(a) 2.0 times the average of the actual
(a) 2% or less tax-efficient savings percentages for
eligible employees who are not highly
compensated employees.
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(b) 2.0 percentage points added to the
(b) over 2% but not more average of the actual tax-efficient
than 8% savings percentages for eligible
employees who are not highly
compensated employees.
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(c) l.25 times the average of the tax-
efficient savings percentages for
(c) more than 8% eligible employees who are not highly
compensated employees or, in any
case, such lesser amount as the
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Secretary of the Treasury shall
prescribe to prevent the multiple use of
parts (a) and (b) of this limitation with
respect to any highly compensated
employee. Notwithstanding the
above, the multiple use test
described in Treasury Regulations
Section 1.401(m)-2 shall not apply
for Plan Years beginning after
December 31, 2001.
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(d) Limitations on After-Tax Savings Contributions Applicable to Highly
Compensated Employees.
The After-Tax Contribution percentage for any eligible employee who is
a highly compensated employee for the year shall be limited to the
extent required under the following tables:
After-Tax Contribution Percentage Limitation
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If the Average of the actual
After-Tax Contribution The allowable Average
percentages of eligible After-Tax Contribution percentage for
employees who are not the current Plan Year for eligible
highly compensated employees
employees for the preceding who are highly
Plan Year (or if the Company compensated employees
amends the Plan to elect the shall not exceed:
current Plan Year) is:
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(a) 2.0 times the average of the actual
(a) 2% or less After-Tax Contribution percentages for
eligible employees who are not highly
compensated employees.
---------------------------- -------------------------------------------
(b) 2.0 percentage points added to the
average of the actual After-Tax
(b) over 2% but not Contribution percentages for eligible
more than 8% employees who are not highly
compensated employees.
---------------------------- -------------------------------------------
(c) l.25 multiplied by the Average After-
Tax Contribution percentage for eligible
(c) more than 8% employees who are not highly
compensated employees or, in any case,
---------------------------- --------------------------------------------
---------------------------- -------------------------------------------
such lesser amount as the Secretary of
the Treasury shall prescribe to prevent
the multiple use of parts (a) and (b) of
this limitation with respect to any highly
compensated employee.
Notwithstanding the above, the
multiple use test described in
Treasury Regulations Section
1.401(m)-2 shall not apply for Plan
Years beginning after December 31,
2001.
---------------------------- -------------------------------------------
(e) Committee Actions to Limit Contributions
The Committee shall, to the extent necessary to conform to the
foregoing limitations, reduce the amounts of allowable After-Tax
Savings Contributions and Tax Efficient Savings Contributions,
respectively, for the year with respect to any or all eligible
employees who are highly compensated employees. Any such
reductions by the Committee shall be made in such manner as the
Committee from time to time may prescribe. For purposes of this
section, the Plan shall satisfy the requirements of Sections
401(k)(3) and 401(m) of the Code and Treas. Reg. Sections
1.401(k)-1(b) and 1.401(m)-1.
5. Return of Contributions in Excess of Limitations
Subject to such regulations as the Committee from time to time may
prescribe, a member whose Tax-Efficient Savings Contributions to
this Plan and similar contributions to all other plans in which the
member is a participant exceed the limit of $7,000 multiplied by the
cost-of-living adjustment factor prescribed by the Secretary of the
Treasury for any year may request and receive return of such excess
Tax-Efficient Savings Contributions to this Plan for such year and
earnings thereon by submitting a request for return of such excess
in this Plan to the Committee in such form as shall be acceptable to
the Committee. Such amounts shall be returned to such member no
later than April l5, l989, and each April l5 thereafter, to members
who submit such requests to the Committee no later than the
immediately preceding March l.
Tax-Efficient Savings Contributions and earnings thereon in excess
of the limitations in this Paragraph IV applicable to such
contributions by employees shall be returned to members on whose
behalf such contributions were made for the preceding P lan Y ear at
such times and upon such terms as the Committee shall prescribe.
Income on excess contributions shall be allocated in the same manner
that income is allocated to members' accounts during the plan year,
and such method will be used consistently for all affected members.
Notwithstanding the foregoing provisions of this paragraph, for
years beginning after December 31, 1996 excess Tax-Efficient Savings
Contributions
and earnings thereon shall be returned on the basis of the amount of
contributions by or on behalf of members as provided in Sections
401(k)(8)(c) of the Code.
6. Rollover Contributions
A newly-hired employee of a Participating Company who elects
membership in the Plan in accordance with Paragraph III may make a
rollover contribution, as permitted under Section 402(a)(5) of the
Internal Revenue Code, to the Plan in cash in an amount not
exceeding the total amount of taxable proceeds distributed to such
employee by a similar qualified plan maintained by his or her
immediately preceding former employer. The rollover contribution
must be made by the employee within 60 days following the receipt by
the employee of such distribution from such former employer's plan.
Rollover contributions shall be invested in accordance with the
provisions of Paragraph VII as the employee shall elect.
Effective January 1, 2002, the Plan will accept the following types of
rollover contributions:
(a) Direct Rollovers of eligible rollover distributions from a qualified
plan described in Sections 401(a) or 403(a) of the Code, including
after-tax employee contributions; an annuity contract described in
Section 403(b) of the Code, excluding after-tax employee
contributions; and an eligible plan under Section 457(b) of the Code
which is maintained by a state, political subdivision of a state or
any agency or instrumentality of a state or political subdivision
of a state.
(b) Member Rollover Contributions of an eligible rollover distribution
from a qualified plan described in Sections 401(a) or 403(a) of the
Code; an annuity contract described in Section 403(b) of the Code;
and an eligible plan under Section 457(b) of the Code which is
maintained by a state, political subdivision of a state, or agency
or instrumentality of a state or political subdivision of a state.
(c) Member Rollover Contributions of the portion of a distribution from
an individual retirement account or annuity described in Sections
408(a) or 408(b) of the Code that is eligible to be rolled over and
would otherwise be includible in gross income.
7. Contributions Following Service in a Uniformed Service
A member of the Plan who is reinstated following qualified military
service, as defined in the Uniformed Services Employment and
Reemployment Rights Act, may elect to have contributions made to the
Plan from such member's wages paid following such qualified military
service that shall be attributable to the period contributions were
not otherwise permitted due to military service. Such additional
contributions shall be based on the amount of wages and profit
sharing that the member would have received but for military service
and shall be subject to the provisions of the Plan in effect during
the applicable period of military service. Such contributions shall
be made
during the period beginning upon reemployment following
military service and ending at the lesser of (i) five years or (ii)
the member's period of military service multiplied by three. Such
additional contributions shall not be taken into account in the year
in which they are made for purposes of any limitation or requirement
identified in Section 414(u)(1) of the Internal Revenue Code
provided, however, that such contributions, when added to
contributions previously made, shall not exceed the applicable
limits in effect during the period of military service if the member
had continued to be employed by the Company during such period.
Further, payments on any loan or loans outstanding during the period
of military service shall be extended for a period of time equal to
the period of qualified military service.
8. Recovery of Contributions
The Company may recover, without interest, the amount of its
contributions made on account of a mistake in fact, provided that
such recovery is made within one year after the date of such
contribution. Any recovery by the Company of its contributions to
the Plan shall not exceed the value at the time of recovery of
assets acquired with the Company's contributions and earnings
thereon.
In the event the deduction of the contribution made by the
Company is disallowed under Section 404 of the Internal Revenue
Code, such contribution (to the extent disallowed) must be returned
to the Company within one year of the disallowance of the deduction.
V. Member's Account in Trust Fund
As soon as practicable after each pay period but in any event not later than
15 days after the month of payment of wages for such pay period, the Company
shall pay to the Trustee (a) the Tax-Efficient Savings, A fter-Tax Savings
and Catch-Up Contributions for such period, and (b) the amounts of payments
by members with respect to loans and interest thereon pursuant to Paragraph
XI hereof. Upon receipt of such payments by the Trustee, the aggregate
amount of such payments (and earnings thereon, as from time to time received
by the Trustee) shall be credited to the respective accounts of the members,
and the Trustee shall hold, invest and dispose of the same as provided in
the Plan.
The corpus or income of the trust may not be diverted to or used for any
purpose other than the exclusive benefit of the members or their
beneficiaries.
VI. Vesting
The assets credited to a member's account shall be fully vested and no
portion of such account shall be subject to forfeiture for any reason
whatsoever.
VII. Member's Election as to Investment of Funds
Tax-Efficient Savings (including Catch-Up Contributions) and After-Tax
Savings Contributions made on behalf of a member shall be invested as the
member shall elect in one or more of the Ford Stock Fund, the Common Stock
Index Fund, the Bond Index Fund, the Interest Income Fund, and any of the
Additional Mutual Funds listed in Appendix A, provided that the amount
contributed to any investment election shall be at least five percent of the
amount contributed; contributions in excess of five percent shall be made in
increments of one percent.
A complete description of each of the Additional Mutual Funds listed in
Appendix A is provided in the prospectus for each Fund. Members should
request and read the prospectus prior to making a decision regarding
investing in a particular fund. A prospectus will be delivered promptly to
any employee upon request.
The Investment Process Committee may, in its discretion, make
recommendations for additions to, deletions from or replacements for any of
the Additional Mutual Funds listed in Appendix A, as described in Article
XX.
A member's investment election hereunder shall be confirmed on his or her
Confirmation Statement. Each investment election hereunder with respect to
wages shall remain in effect until changed by the member, and may be changed
effective for any pay period in respect of Tax-Efficient Savings and
After-Tax Savings Contributions made thereafter by delivering a notice in
such form and in such manner and at such time as the Committee shall
specify. Profit sharing distributions that members elect to have contributed
to the Plan shall be invested in accordance with a member's election in
effect with respect to weekly wages at the time profit sharing distributions
are contributed to the Plan or, if the member does not have in effect such
an election with respect to weekly wages, in accordance with the member's
latest election or, in the absence of any such election, in the Interest
Income Fund.
VIII. Transfer of Assets to Other Investment Elections
Any member may elect, at such times, in such manner, to such extent and with
respect to such assets as the Committee from time to time may determine, to
have the value of all or part of the assets invested in any investment
election under the Plan in such member's account transferred by being
invested in such account in such other of the ways in which After-Tax
Savings Contributions and Tax-Efficient Savings Contributions (including
Catch-Up Contributions) may be invested pursuant to this Paragraph VIII as
the member shall elect; provided, however, that:
(a) a member may make one (1) or more such transfer elections each business
day;
(b) a member may make such transfer elections in either a dollar amount,
share/unit or a percentage of the amount invested in such investment
election from which such transfer is elected, in increments of one
percent, provided that the amount transferred is at least the greater of
five percent of the value of the assets in the investment election from
which
transfer is elected or $250.00, or, if the amount invested in the
investment election from which transfer is elected is less than $250.00,
the entire value of the assets invested in the investment election from
which transfer is elected; and
(c) all such transfer elections shall be subject to such other regulations
as the Committee may prescribe, which may specify, among other things,
application procedures, minimum and maximum amounts that may be
transferred, procedures for determining the value of assets, the subject
of a transfer election and other matters which may include conditions or
restrictions applicable to transfer elections.
IX. Investment of Dividends, Interest, Etc.
Cash dividends, interest, and the cash proceeds of any other distribution in
respect of any investment funds available under this Plan, shall be invested
in the respective Funds giving rise to the same; except that, commencing
with respect to Company stock with the dividend payable in the third quarter
of 1996, all or a portion of cash dividends paid on Company stock held in
the Ford Stock Fund that have not been in the Plan continuously since
January 1, 1989 shall be distributed in accordance with the provisions of
Paragraph X to members who have elected to invest in the Ford Stock Fund
unless such members elect not to receive such dividends. Cash dividends on
Company stock in the Ford Stock Fund that are not distributed to members
shall be invested on behalf of the members entitled thereto in the Ford
Stock Fund through the purchase of additional Ford Stock Fund Units.
X. Distribution of Assets
Distribution of all assets in a member's account shall be governed by the
following provisions:
1. Termination of Employment
In the case of a member's termination of employment for any reason
(whether voluntary or by discharge, with or without cause), the cash
value of assets in his or her account shall be delivered to the
member as soon as practicable after the earliest of the following:
(i) Receipt of a request for distribution made by the member at or
after termination of employment in accordance with the provisions of
Paragraph XII,
(ii) In the case of a member who has terminated employment, attained
age sixty-five (65), and requested a distribution of the cash value
of the assets in his or her account, provided that the request for
distribution is received by the end of the Plan Year in which the
member attains age sixty-five (65), the distribution shall be made
no later than the 60 th day after the close of the Plan Year in
which such member attains age sixty-five (65),
(iii) Attainment of age seventy and one-half (70-1/2) on or after
January 1, 1988 in which event distribution of the cash value of
assets in his or her account shall begin not later than April 1 of
the calendar year following the calendar year in which the member
attains age seventy and one- half (70-1/2) and shall be made over a
period of fifteen (15) years or, if the member so elects, over the
life of the member or the lives of the member and the member's
beneficiary under the Plan (including the member's spouse) in
accordance with Section 401(a)(9) of the Internal Revenue Code and
with regulations prescribed by the Secretary of the Treasury
thereunder and subject to such regulations as the Committee may
prescribe.
Distributions for calendar years 2000, 2001 and 2002 will be made in
accordance with Section 401(a)(9) 2001 Proposed Regulations,
including the incidental death benefit requirements of the Code
Section 401(a) (9) (G).
Effective January 1, 2003, all distributions made with respect to a
member who has attained age 70 1/2 shall be made in accordance with
the regulations prescribed by the Secretary of the Treasury under
Section 401(a)(9) Final and Temporary Regulations of the Code,
including the minimum distribution incidental death benefit
requirements of Code Section 401(a) (9) (G), and subject to such
regulations as the Committee may prescribe. The distribution
provisions under Section 401(a) (9) Final and Temporary Regulations
override any inconsistent distribution options in the Plan included
herein. Notwithstanding the immediately preceding sentence, a member
may at anytime elect a distribution under Article XII of the Plan.
(a) Required Beginning Date. The member's entire interest will be
distributed, or begin to be distributed to the member no later
than the member's Required Beginning Date as defined in
Subsection 3(b).
(b) Amount of Required Minimum Distribution for Each Distribution
Calendar Year. During the member's lifetime, the minimum amount
that will be distributed for each distribution calendar year (as
defined in Subsection 3(b)) is the lesser of:
(i) the quotient obtained by dividing the member's account
balance by the distribution period in the Uniform Lifetime
Table set forth in Section 1.401(a) (9)-9 of the Treasury
Regulations, using the member's age as of the member's
birthday in the Distribution Calendar Year; or
(ii) if the member's sole designated beneficiary for the
distribution calendar year is the member's spouse, the
quotient obtained by dividing the member's account balance by
the number in the Joint and Last Survivor Table set forth in
Section 1.401(a)(9)-0 of the Treasury Regulations, using the
member's and spouse's attained ages as of the member's and
spouse's birthdays in the Distribution Calendar Year.
(c) Lifetime Required Minimum Distributions Continue Through Year of
Member's Death. Required minimum distributions will be
determined under this subsection beginning with the first
Distribution Calendar Year and up to and including the
Distribution Calendar Year that includes the member's date of
death.
(iv) for accounts established on or after October 1, 1995, at
termination of employment if the value of the account is less than
$3,500 (determined within 90 days after termination) and was less
than $3,500 on the effective date of any prior withdrawal or
distribution from such member's account. Effective January 1, 2004,
rollover amounts will not be considered when determining this
involuntary distribution.
2. Dividends on Company stock in the Ford Stock Fund
All or a portion of cash dividends paid on shares of Company stock
in the Ford Stock Fund that have not been in the Plan continuously
since January 1, 1989 shall be distributed proportionately to
members who have assets in the Ford Stock Fund on the dividend
record date and do not reject such distribution. The amount of such
dividends that shall be distributed to members who do not reject
distribution shall equal the lesser of (i) the total of such
dividends, or (ii) the total amount of dividends paid on all shares
held in the Ford Stock Fund multiplied by the ratio of the number of
Ford Stock Fund units in the accounts of members who do not reject
such distribution to the number of Ford Stock Fund units in the
accounts of all members, such determination to be made as of the
dividend record date. The amount of such dividends that shall be
distributed to each member who has not rejected such distribution
shall be equal to the total amount of dividends to be distributed
multiplied by the ratio of the number of Ford Stock Fund units in
the account of such member to the total number of Ford Stock Fund
units in the accounts of all members who have not rejected such
distribution, all determined as of the end of each business day that
is a trading day of the New York Stock Exchange.
For dividends paid after January 1, 2002, members shall have the
right to receive such dividends from the Plan. It shall be presumed
that such dividends will be reinvested in the Plan unless the member
elects otherwise.
The Committee shall from time to time determine the manner in which
members shall be provided an opportunity to reject distribution of
Company stock dividends or to change a prior election with respect
to distribution.
Distribution of such dividends shall be made as soon as practicable
after receipt of such dividends by the Trustee.
A member to whom such dividends would otherwise be distributed may
reject such distribution in such manner and at such time as the
Committee shall determine.
3. Death of a Member
In the event of death of a member, distribution shall be made to
such member's beneficiaries hereunder as soon as practicable after
notice of such member's death is received by the Company.
Notwithstanding the provisions of the immediately preceding
sentence, effective January 1, 2000, or as soon as is
administratively feasible thereafter, (a) if a member's beneficiary
is the member's surviving spouse, if the member has elected a
distribution schedule which had commenced by the member's date of
death, the member's account shall continue to be paid to the
surviving spouse pursuant to such schedule or, at the spouse's
election at any time, in a lump sum, and (b) if distribution of the
member's account has not commenced as of the member's date of death,
the surviving spouse shall, for purposes of the distribution
requirements and options under the Plan, be deemed a member; except
that the surviving spouse shall be deemed to attain age seventy and
one-half (70-1/2) on the date the member would have attained such
age.
Effective January 1, 2003, all distributions made in the event of
the death of a member shall be made in accordance with the
regulations prescribed by the Secretary of the Treasury under
Section 401(a) (9) Final and Temporary Regulations of the Code
included herein, and subject to such regulations as the Committee
may prescribe. The distribution provisions under Section 401(a) (9)
Final and Temporary Regulations override any inconsistent
distribution options in the Plan included herein.
(a) Time and Manner of Distribution in the event of the death of a
member before distributions begin. If the member dies before
distributions begin, the cash value of the member's account will
be distributed, or begin to be distributed, no later than as
follows:
(i) If the member's surviving spouse is the sole designated
beneficiary, then, except as provided in this Section,
distributions to the surviving spouse will begin by December 31
of the calendar year immediately following the calendar year in
which the member died, or by December 31 of the calendar year in
which the member would have attained age 70, if later.
(ii) If the member's surviving spouse is not the member's sole
designated beneficiary, the cash value of the member's account
balance will be distributed to the designated beneficiary by
December 31 of the calendar year containing the fifth (5th)
anniversary of the member's death.
(iii) If there is no designated beneficiary as of September 30 of
the year following the year of the member's death, the cash
value of the member's account balance will be distributed to the
member's estate by December 31 of the calendar year containing
the fifth (5th) anniversary of the member's death.
(iv) If the member's surviving spouse is the member's sole
designated beneficiary and the surviving spouse dies after the
member but before distributions to the surviving spouse begin,
the cash value of the member's account balance will be made to
the surviving spouse's estate.
(b) Definitions: For purposes of this Section, the following terms shall
have the following meanings:
(i) Designated beneficiary. The individual who is designated as the
beneficiary under Section XXIV of the Plan and is the designated
beneficiary under Section 401(a)(9) of the Internal Revenue Code
and Section 1.401(a) (9)-1, Q&A-4, of Treasury regulations.
(ii) Distribution Calendar year. A calendar year for which a minimum
distribution is required. For distributions beginning before the
member's death, the first Distribution Calendar Year is the calendar
year immediately preceding the calendar year which contains the
member's Required Beginning Date. For distributions beginning after
the member's death, the first Distribution Calendar Year is the
calendar year in which distributions are required to begin under
this Section of the Plan. The required minimum distribution for the
member's first Distribution Calendar Year will be made on or before
the member's Required Beginning Date. The required minimum
distribution for other Distribution Calendar Years, including the
required minimum distribution for the Distribution Calendar Year in
which the member's Required Beginning Date occurs, will be made on
or before December 31 of that Distribution Calendar Year.
(iii) Life expectancy. Life expectancy is computed by use of the Single
Life Table in Section 1.401(a)(9)-9 of the Treasury Regulations.
(iv) Member's Account Balance. The account balance as of the last
valuation date in the calendar year immediately preceding the
Distribution Calendar Year (valuation calendar year) increased by
the amount of any contributions made and allocated or forfeitures
allocated to the account balance as of dates in the valuation
calendar year after the valuation date and decreased by
distribubitions made in the valuation calendar year after the
valuation date. The account balance for the valuation calendar year
includes any amounts rolled over or transferred to the Plan either
in the valuation calendar year or in the Distribution Calendar Year
if distributed or transferred in the valuation calendar year.
(v) Required Beginning Date. April 1 of the calendar year following the
later of: (a) the calendar year in which the employee attains age 70
or (b) the calendar year in which the employee retires, except as
provided in Section 409(d) of the Code, in the case of an employee
who is a 5-percent owner (as defined in Section 416) with respect to
the Plan Year ending in the calendar year in which the employee
attains age 70.
4. Miscellaneous
For purposes of any distribution of assets in a member's account
pursuant to this Paragraph X, the cash value of assets in his or her
account shall be reduced by the balance of any loan made to such
member as provided in Paragraph XI hereof and interest thereon that
is unpaid at the effective date of such distribution.
Subject to the provisions of Paragraph XVII hereof, and subject to
such regulations as the Committee from time to time may prescribe, a
member receiving a distribution pursuant to this Paragraph X may
direct the Trustee to make distribution of the cash value of assets
in such member's Ford Stock Fund account in the form of whole shares
of Company stock and cash for any fraction of a share, such
distribution to be at a price per share equal to the current market
value of Company stock on the effective date of the distribution.
The member so directing the Trustee shall pay all applicable
transfer taxes incident to the distribution of such shares by the
Trustee, and the amount thereof may be deducted from the payment
made by the Trustee to the member.
Assets held for the benefit of an alternate payee pursuant to a
qualified domestic relations order as defined by Section 414(p) of
the Internal Revenue Code of 1986 and Section 206(d) of ERISA shall
be distributed prior to the date on which assets would be
distributed to a member if such order so requires provided that such
order requires distribution of all assets held for the benefit of
such alternate payee.
In the event that distribution to a member or his or her beneficiary
or beneficiaries cannot be made because the identity or location of
such member or such beneficiary or beneficiaries cannot be
determined after reasonable efforts and if the assets in such
member's account for that reason remain undistributed for a period
of one year, the Committee may direct that the assets in such
member's account shall be forfeited and all liability for the
payment thereof shall terminate provided, however, that in the event
that the identity or location of the member or beneficiary is
subsequently determined, the value of the assets in such member's
account at the date of forfeiture shall be paid by the Company to
such person in a single sum. The value of the assets so forfeited
shall be applied, as soon as practicable, to reimburse the Company
for its expense in administering the Plan. For such purposes, the
value of the assets in such member's account shall be determined as
of the date of the forfeiture.
5. Rollovers
A member who would otherwise receive a distribution may elect to
have the Trustee transfer directly to an Individual Retirement
Account ("IRA") of the member or to another employer's plan in which
the member is a participant all or part of the assets included in
the distribution, including Company stock, except (i) a distribution
required to be made to a member who has attained age seventy and
one-half (70 1/2) to satisfy the minimum distribution requirements
of Section 401(a)(9) of the Internal Revenue Code, (ii) the portion
of the distribution that constitutes a return of the member's
after-tax contributions that were transferred from the Tax Reduction
Act Stock Ownership Plan for Hourly Employees when that Plan was
terminated in 1989, (iii) effective for calendar years beginning
January 1, 1999, an eligible rollover distribution described in Code
Section 402(c) (4), which the participant can elect to roll over to
another plan pursuant to Code Section 401(a) (31), excludes hardship
withdrawals as defined in Code Section 401(k) (2) (B) (i) (IV),
which are attributable to the member's elective contributions under
Treasury Reg. Section 1.401(k)-1 (d) (2) (ii), or (iv) effective
January 1, 2002, any amount that is distributed on account of
hardship shall not be an eligible rollover distribution and the
distributee may not elect to have any portion of such a distribution
paid directly to an eligible retirement plan. Any transfer shall be
subject to such regulations as the Committee from time to time may
prescribe. The member shall designate the IRA or other employer's
plan to which assets are to be transferred and transfer shall be
made subject to acceptance by the transferee plan or IRA.
Effective January 1, 2002:
(a) Modification of definition of eligible retirement plan. For purposes
of the direct rollover provisions in Section IV of the Plan, an
eligible retirement plan shall also mean an annuity contract
described in Section 403(b) of the Code and an eligible plan under
Section 457(b) of the Code which is maintained by a state, political
subdivision of a state, or any agency or instrumentality of a state
or political subdivision of a state and which agrees to separately
account for amounts transferred into such plan from this Plan. The
definition of eligible retirement plan shall also apply in the case
of a distribution to surviving spouse, or to a spouse or former
spouse who is the alternate payee under a qualified domestic
relation order, as defined in Section 414(p) of the Code.
(b) Modification of definition of eligible rollover distribution to
exclude hardship distributions. For purposes of the direct rollover
provisions in Section IV of the Plan, any amount that is distributed
on account of hardship shall not be an eligible rollover
distribution and the distributee may not elect to have any portion
of such a distribution paid directly to an eligible retirement plan.
(c) Modification of definition of eligible rollover distribution to
include after-tax employee contributions. For purposes of the direct
rollover provisions in Section IV of the Plan, a portion of a
distribution shall not fail to be an eligible rollover distribution
merely because the portion consists of after-tax employee
contributions which are not includible in gross income. However,
such portion
may be transferred only to an individual retirement
account or annuity described in Section 408(a) or (b) of the Code,
or to a qualified defined contribution plan described in Section
401(a) or 403(a) of the Code that agrees to separately account for
amounts so transferred, including separately accounting for the
portion of such distribution which is includible in gross income and
the portion of such distribution which is not so includible.
6. Active Employees who attained age seventy and one- half (70 1/2)
prior to January 1, 1997
Distributions to active employees who attained age seventy and one-
half (70 1/2) prior to January 1, 1997 shall be continued in
accordance with the provisions of the Plan and the Internal Revenue
Code as in effect prior to January 1, 1997 unless such active
employees elect to have such distributions discontinued effective
beginning with distributions that would otherwise be required to be
made for the 1997 Plan Year.
7. If the Committee shall find that any person to whom any payment is
payable from the Plan is unable to care for his or her affairs because
of illness, accident, or disability, or is a minor, any payment due may
be paid to the spouse, child, a parent, or a brother or sister, or to
any person deemed by the Committee to have incurred expense for such
person otherwise entitled to payment (unless a prior claim therefor
shall have been made by a duly appointed guardian, committee or other
legal representative). In addition, the Committee may make distributions
on behalf of minors to parties it deems appropriate under any Uniform
Transfer to Minors Act. Any such payment shall be a complete discharge
of the liabilities of the Plan therefor.
XI. Borrowings with Respect to Assets Attributable to Tax-Efficient Savings
Contributions
Subject to such regulations as the Committee from time to time may
prescribe, a member prior to termination of employment may apply for and
receive a loan from the Plan provided that the aggregate of all such loans
does not exceed the lesser of
(i) fifty percent (50%) of the cash value of assets at the time of any
such loan in his or her account but not more than $50,000; or
(ii) $50,000 reduced by the difference between such member's highest
loan balance under all plans of the Company and its subsidiaries
during the previous 12 months (ending on the day before the
effective date of such loan from the Plan) and such member's loan
balance on the effective date of such loan.
The member may designate the assets to be used to provide the amount of the
loan or, if the member so elects, such loan shall be made proportionately
from each investment in such member's account under the Plan. No loan of
less than $1,000 shall be made. All loans from all plans of the Company and
other members of a group of employers described in Sections
414(b), 414(c), 414(m) and 414(o) of the Internal Revenue Code are
aggregated for purposes of the above limitation in Subparagraph (ii).
All such loans shall (i) be available to all members on a reasonably
equivalent basis, (ii) be adequately secured and (iii) bear a reasonable
rate of interest and be subject to such other requirements, including
repayment terms, as the Committee from time to time may prescribe, provided,
however, that (a) the entire amount of any such loan and all amounts of
related interest must be repaid not later than 60 months or, in the case of
a loan made for the member to buy or construct the principal residence of
the member, 120 months (or, when permitted by law, such later date as the
Committee may determine) after the month in which the loan is effective and
(b) repayments shall be made by a member from his or her wages by payroll
deductions or in such other manner as the Committee may prescribe. In no
event shall the repayment be made less frequently than once per calendar
quarter. The Committee shall determine a rate of interest such that the Plan
is provided with a return commensurate with the interest rates charged by
persons in the business of lending money for loans which would be made under
similar circumstances. Any loan to a member shall be secured by such
member's interest in the Plan. All such requirements shall be applicable on
a uniform and non-discriminatory basis to all members who may apply for such
loans.
Amounts paid by a member, including interest payments, with respect to any
such loan shall be credited to a loan subaccount in such member's account.
Loan repayments, including interest, on loans made before October 1, 1995
shall be invested in the Interest Income Fund until the member elects to
have such assets transferred. Loan repayments, including interest, on loans
made on or after October 1, 1995 shall be invested in the latest investment
elections made on or after October 1, 1995 by the member with respect to
weekly contributions or, in the absence of such election, in the Interest
Income Fund until the member elects to have such assets transferred.
XII. Withdrawal of Assets
Prior to termination of employment a member shall not be permitted to
withdraw all or any portion of the cash value of the assets in the member's
account; provided, however, that such withdrawal shall be permitted (i) at
any time after the member shall have attained age fifty-nine and one-half
(59-1/2) or (ii) prior to attaining age fifty-nine and one-half (59-1/2), if
withdrawal (i) is made on account of an immediate and heavy financial need
of the member and (ii) is necessary to satisfy such financial need.
At any time or from time to time prior to termination of employment, a
member may withdraw all or part of the cash value of assets in his or her
After-Tax Savings Account that are attributable to his or her After-Tax
Savings Contributions and earnings thereon.
At any time after the member shall have terminated employment or attained
age fifty-nine and one-half (59 1/2), a member may elect to withdraw all or
part of the cash value of assets in such member's account as the member may
specify. In addition, a member may elect to make a systematic withdrawal of
the cash value of assets in such member's account in monthly, quarterly,
semi-annual or annual installments over such period of time as the
member shall specify. Each such installment shall be paid in an amount equal
to the cash value of assets in such member's account at the effective date
of each such installment multiplied by a fraction the numerator of which is
one and the denominator of which is the number of installments remaining in
the period specified by the member. The cash value of each such installment
in a systematic withdrawal shall be withdrawn proportionately from each of
the investments which the member has elected under the Plan at the effective
date of each such installment. The effective date of each such installment
shall be selected by the Committee and communicated to members of the Plan.
Such systematic withdrawals shall be subject to such further requirements as
the Committee shall specify. In the event that the systematic withdrawals
specified by the member do not meet the minimum distribution requirements
beginning at age seventy and one half (70 1/2) under Section 401(a) (9) of
the Internal Revenue Code as specified in Paragraph X, then such additional
amounts shall be distributed in accordance with the provisions of Paragraph
X as necessary to satisfy such minimum distribution requirements.
An immediate and heavy financial need shall be deemed to exist if the
requirements of Treasury Regulation Section 1.401(k)-1(d)(2)(ii)(B) are met
or if an expense of $500 or more is approved by the Committee as
constituting an immediate and heavy financial need. A withdrawal will be
deemed necessary to satisfy such financial need if (i) the withdrawal is not
in excess of the immediate and heavy financial need; (ii) the member has no
other distribution or nontaxable loan privileges available from any plan
maintained by the Company or its subsidiaries; (iii) the member's
contributions to the Company's savings plans are suspended for twelve months
after the withdrawal; and (iv) the annual limit on Tax-Efficient Savings
Contributions in the taxable year of enrollment following the hardship
withdrawal is reduced by the amount of Tax-Efficient Savings Contributions
made in the withdrawal year. Any withdrawal on account of financial hardship
cannot exceed the dollar amount of Tax-Efficient Savings Contributions made
to the account of the member, exclusive of earnings thereon after December
31, 1988. Any such withdrawal of assets shall be made as of the date
specified by the Committee in its determination of the existence of a
financial hardship. The assets so withdrawn shall be delivered to the member
as soon as practicable after the effective date of the withdrawal.
Subject to the provisions of Paragraph XVII hereof, and subject to such
regulations as the Committee from time to time may prescribe, a member
requesting any such withdrawal other than an installment under a systematic
withdrawal, may direct the Trustee to make distribution of assets in such
member's Ford Stock Fund account in the form of whole shares of Company
stock, and in cash for any fractional share, such distribution to be at a
price per share equal to the current market value of Company stock on the
effective date of the withdrawal. The member so directing the Trustee shall
pay all applicable transfer taxes incident to the distribution of such
shares by the Trustee, and the amount thereof may be deducted from the
payment made by the Trustee to the member.
A member who would otherwise request a withdrawal may elect to have the
Trustee transfer directly to an Individual Retirement Account ("IRA") of the
member or to another employer's plan in which the member is a participant
all or part of the assets included in the withdrawal, including Company
stock, except (i) a withdrawal made after attainment of age seventy and
one-half (70 1/2) to satisfy the minimum distribution requirements under
Section 401(a) (9) of the Internal Revenue Code and (ii) the portion of the
withdrawal that constitutes a return of the member's after-tax contributions
that were transferred from the Tax Reduction Act Stock Ownership Plan for
Hourly Employees when that Plan was terminated in 1989. Any transfer shall
be subject to such regulations as the Committee from time to time may
prescribe. The member shall designate the IRA or other employer's plan to
which assets are to be transferred and transfer shall be made subject to
acceptance by the transferee plan or IRA.
XIII. Ford Stock Fund, Common Stock Index Fund, Bond Index Fund, Interest Income
Fund, and Mutual Funds
1. Ford Stock Fund
The Trustee shall establish and administer the Ford Stock Fund in
accordance with the following:
(a) Investments
For each member who elects pursuant to Paragraph VII to have
Tax-Efficient Savings Contributions and/or After-Tax Savings
Contributions invested in the Ford Stock Fund or for whom a
transfer is made to the Ford Stock Fund as provided in Paragraph
VIII hereof, the Trustee shall invest the sums so to be invested
or transferred in accordance with instructions of a person,
company, corporation or other organization appointed by the
Company. The Trustee may be appointed for such purpose.
Investments shall be made primarily in shares of Company stock;
a small portion shall be invested in short-term investments to
provide liquidity for daily activity. It is expected that about
one to two percent of the Fund will be held in short-term
investments, but the percentage may be higher or lower,
depending upon the expected liquidity requirements of the Fund.
Investments of all or a portion of Ford Stock Fund assets may be
made in any common, collective or commingled fund when, in the
opinion of the Trustee, such investments are consistent with the
objective of the Ford Stock Fund.
(b) Ford Stock Fund Units
Members shall have no ownership in any particular asset of the Ford
Stock Fund. The Trustee shall be the sole owner of all Ford Stock
Fund assets. Proportionate interests in the Ford Stock Fund shall be
expressed in Ford Stock Fund Units. All Ford Stock Fund Units shall
be of equal value and no Ford Stock Fund Unit shall have priority or
preference over any other. Ford Stock Units shall be credited by the
Trustee to accounts of members as of each valuation date.
(c) Ford Stock Fund Unit Prices
The term "Ford Stock Fund Unit Price," as used herein, shall
mean the value in money of an individual Ford Stock Fund Unit
expressed to the nearest cent. The Ford Stock Fund Unit Price as
of October 1, 1995 was $10.00, as determined by the Committee.
The number of Ford Stock Fund Units as of October 1, 1995 was
determined by dividing the market value of shares of Company
stock and cash received by the Trustee for investment in the
Ford Stock Fund by such Ford Stock Fund Unit Price. Thereafter,
the Ford Stock Fund Unit Price shall be redetermined at the end
of each business day that is a trading day of the New York Stock
Exchange. The Ford Stock Fund Unit Price for each such business
day shall be determined by dividing the net asset value of the
Ford Stock Fund on such business day by the number of Ford Stock
Fund Units outstanding on such business day. Ford Stock Fund
Unit Prices shall be determined before giving effect to any
distribution or withdrawal and before crediting contributions to
members' accounts effective as of any such business day. Net
asset value of the Ford Stock Fund shall be computed as follows:
(i) Company stock shall be valued at the closing price on the New
York Stock Exchange on such business day, or, if no sales were
made on that date, at the closing price on the next preceding
day on which sales were made.
(ii) All other assets of the Ford Stock Fund, including any interest
in a common, collective or commingled fund, shall be valued at
the fair market value as of the close of business on the
valuation date. Fair market value shall be determined by the
Trustee in the reasonable exercise of its discretion, taking
into account values supplied by a generally accepted pricing or
quotation service or quotations furnished by one or more
reputable sources, such as securities dealers, brokers, or
investment bankers, values of comparable property, appraisals or
other relevant information and, in the case of a common,
collective or commingled fund, fair market value shall be the
unit value of such fund for a date the same as the valuation
date, or as close thereto as practicable.
(iii) Ford Stock Fund Units credited to members' accounts with
respect to After-Tax Savings Contributions and Tax-Efficient
Savings Contributions (including Catch-Up Contributions) made
during any month shall be credited at the Ford Stock Fund Unit
Price determined as of the close of business on the day that
such contributions are received by the Trustee. Ford Stock Fund
Units withdrawn or distributed shall be valued at the Ford Stock
Fund Unit Price at the close of business on the day coinciding
with the effective date of such withdrawal or distribution.
(iv) Investment transactions, income and any expenses chargeable to
the Ford Stock Fund will be accounted for on an accrual basis.
(d) Distribution and Withdrawal From Ford Stock Fund
The cash value of assets in the Ford Stock Fund shall be
distributed to members or may be withdrawn by members only in
accordance with Paragraphs X and XII hereof. All distributions
and withdrawals shall be in cash, except that a member making a
withdrawal or receiving a distribution may direct the Trustee to
make such withdrawal or distribution in the form of whole shares
of Company stock, based on the closing price on the New York
Stock Exchange on the effective date of such withdrawal or
distribution.
(e) Registered Name
Securities held in the Ford Stock Fund may be registered in the
name of the Trustee or its nominee.
(f) Commissions Charged to the Plan
No commission shall be charged to the Plan or any trust under
the Plan in connection with any acquisition by the Plan of
Company Stock from the Company, whether by cash purchase,
exchange, conversion or otherwise.
(g) Exchanges Into or Out of the Ford Stock Fund
Effective June 1, 2000, members may exchange into or out of the
Ford Stock Fund no more than five (5) times in a calendar month.
2. Common Stock Index Fund
The Trustee shall establish and administer the Common Stock Index
Fund in accordance with the following:
(a) Investments
For each member who elects pursuant to Paragraph VII to have
Tax-Efficient Savings Contributions (including Catch-Up
Contributions) and After-Tax Savings Contributions invested in
the Common Stock Index Fund or for whom a transfer is made to
the Common Stock Index Fund as provided in Paragraph VIII
hereof, the Trustee shall invest the sums so to be invested or
transferred in accordance with instructions of a person,
company, corporation or other organization appointed by the
Company. The Trustee may be appointed for such purpose.
The Common Stock Index Fund passively invests in common stocks
of companies with a market capitalization of at least $250
million and encompasses most U.S. and international common
stocks traded in the United States. This fund invests in stocks
in approximately the same proportion as the U.S. market. The
Common Stock Index Fund provides broad market diversification in
terms of company size and geography. It represents
established markets, including the United States, Europe, and
Japan, as well as other countries, including some emerging
markets. Once stocks are purchased, they are sold when the
outstanding market capitalization falls below $100 million.
Investments of all or a portion of Common Stock Index Fund
assets may be made in any common, collective or commingled fund
when, in the opinion of the Trustee, such investments are
consistent with the objective of the Common Stock Index Fund. A
portion of the funds of the Common Stock Index Fund may be held
in cash or invested in short-term obligations when deemed
advisable by the Trustee. Securities may be sold without regard
to the length of time they have been held.
The value of a unit can go up or down, based on the market
values of the securities held in the Common Stock Index Fund and
dividends paid on those securities and other earnings; however,
the total number of units credited to the member's account does
not change except as a result of an exchange, withdrawal or
distribution.
The Trustee may limit or suspend transactions in the Common
Stock Index Fund temporarily because liquidity is insufficient
to satisfy the requested volume of transactions or for other
reasons.
(b) Common Stock Index Fund Units
Members shall have no ownership in any particular asset of the
Common Stock Index Fund. The Trustee shall be the sole owner of
all Common Stock Index Fund assets. Proportionate interests in
the Common Stock Index Fund shall be expressed in Common Stock
Index Fund Units. All Common Stock Index Fund Units shall be of
equal value, representing a proportionate share of the value of
the Fund, and no Common Stock Index Fund Unit shall have
priority or preference over any other. Common Stock Index Fund
Units shall be credited by the Trustee to accounts of members as
of such valuation date.
(c) Common Stock Index Fund Unit Prices
The term "Common Stock Index Fund Unit Price," as used herein,
shall mean the value in money of an individual Common Stock
Index Fund Unit expressed to the nearest cent. The Common Stock
Index Fund Unit Price as of November 30, 1988 was determined by
the Committee. The number of Common Stock Index Fund Units as of
November 30, 1988 was determined by dividing the total amounts
received by the Trustee for investment in the Common Stock Index
Fund by such Common Stock Index Fund Unit Price. Thereafter, the
Common Stock Unit Price shall be redetermined at the end of each
business day that is a trading day on the New York Stock
Exchange. The Common Stock Index Fund Unit Price for each such
business day shall be determined by dividing the net asset value
of the Common Stock Index Fund on such business day by the
number of Common Stock
Index Fund Units outstanding on such business day. Common Stock
Index Fund Unit Prices shall be determined before giving effect
to any distribution or withdrawal and before crediting
contributions to members' accounts effective as of any such
business day. Net asset value of the Common Stock Index Fund
shall be computed as follows:
(i) Securities listed on a national stock exchange shall be valued
at the closing price on the valuation date, or, if no sales were
made on that date, at the closing price on the next preceding
day on which sales were made, in either case as reported on the
primary exchange.
(ii) Securities traded only in over-the-counter markets shall be
valued at the mean of the closing bid and asked prices as listed
in a publication or publications selected by the Trustee for the
valuation date, or the next preceding day for which such prices
are available, if not available for the valuation date.
(iii) All other assets of the Common Stock Index Fund, including any
interest in a common, collective or commingled fund, shall be
valued at the fair market value as of the close of business on
the valuation date. Fair market value shall be determined by the
Trustee in the reasonable exercise of its discretion, taking
into account values supplied by a generally accepted pricing or
quotation service or quotations furnished by one or more
reputable sources, such as securities dealers, brokers, or
investment bankers, values of comparable property, appraisals or
other relevant information and, in the case of a common,
collective or commingled fund, fair market value shall be the
unit value of such fund for a date the same as the valuation
date, or as close thereto as practicable.
(iv) Common Stock Index Fund Units credited to members' accounts
with respect to Tax-Efficient Savings Contributions made during
any month shall be credited at the Common Stock Index Fund Unit
Price determined as of the close of business on the day that
such contributions are received by the Trustee. Common Stock
Index Fund Units withdrawn or distributed shall be valued at the
Common Stock Index Fund Unit Price at the close of business on
the day coinciding with the effective date of such withdrawal or
distribution.
(v) Investment transactions, income and any expenses chargeable to
the Common Stock Index Fund will be accounted for on an accrual
basis.
(d) Distribution and Withdrawal From Common Stock Index Fund
The cash value of assets in the Common Stock Index Fund shall be
distributed to members or may be withdrawn by members only in
accordance with Paragraphs X and XII hereof. All distributions
and withdrawals shall be only in cash.
(e) Voting Stock
The Trustee shall be entitled, itself or by proxy, to vote in
its discretion all shares of voting stock in the Common Stock
Index Fund.
(f) Registered Name
Securities held in the Common Stock Index Fund may be registered
in the name of the Trustee or its nominee.
3. Bond Index Fund
The Trustee shall establish and administer the Bond Index Fund in
accordance with the following:
(a) Investments
For each member who elects pursuant to Paragraph VII to have
Tax-Efficient Savings Contributions (including Catch-Up
Contributions) and/or After-Tax Savings Contributions invested
in the Bond Index Fund or for whom a transfer is made to the
Bond Index Fund as provided in Paragraph VIII hereof, the
Trustee shall invest the sums so to be invested or transferred
in accordance with instructions of a person, company,
corporation or other organization appointed by the Company. The
Trustee may be appointed for such purpose.
Investments shall be made with the objective of providing
investment results that closely correspond to the price and
yield performance of the Xxxxxx Brothers Aggregate Index (the
"Xxxxxx Aggregate Index"). Assets shall be invested in a
portfolio of the Treasury notes and bonds, corporate notes and
bonds and mortgage-backed securities and other securities that,
in the aggregate, typify the securities that are included in the
Xxxxxx Aggregate Index, and have at least one year until
maturity and an outstanding par value of at least $100 million.
Investments of all or a portion of Bond Index Fund assets may be
made in any common, collective or commingled fund maintained by
the Trustee or the person, company, corporation or other
organization appointed by the Company to manage all or a portion
of the Bond Index Fund when, in the opinion of the Trustee or
the person, company, corporation or other organization appointed
by the Company to manage all or a portion of the Bond Index
Fund, such investments are consistent with the objective of the
Bond Index Fund. To the extent that assets are so invested, they
shall be subject to the terms and conditions of the Declaration
of Trust of such common, collective or commingled fund, as
amended from time to time. A portion of the funds of the Bond
Index Fund may be held in cash or invested in short-term
obligations when deemed advisable by the Trustee or the person,
company, corporation or other organization appointed by the
Company to manage all or a portion of the Bond Index Fund. The
value of the member's investment in the Bond Index Fund may
fluctuate with changes in interest rates or for other reasons.
Securities may be sold without regard to the length of
time they have been held. A different market index of publicly
traded fixed income securities may be selected by the Company
for investments of Bond Index Fund assets in the event the
Xxxxxx Aggregate Index is discontinued or for other reasons.
(b) Bond Index Fund Units
Members shall have no ownership in any particular asset of the
Bond Index Fund. The Trustee shall be the sole owner of all Bond
Index Fund assets. Proportionate interests in the Bond Index
Fund shall be expressed in Bond Index Fund Units. All Bond Index
Fund Units shall be of equal value and no Bond Index Fund Unit
shall have priority or preference over any other. Bond Index
Fund Units shall be credited by the Trustee to accounts of
members as of each valuation date.
The value of a unit can go up or down, based on the market
values of the securities in the Bond Index Fund and interest
paid on those securities and other earnings; however, the total
number of units credited to the member's account will not change
unless the member makes a contribution, exchange, loan or
withdrawal, or receives a distribution.
(c) Bond Index Fund Unit Prices
The term "Bond Index Fund Unit Price," as used herein, shall
mean the value in money of an individual Bond Index Fund Unit
expressed to the nearest cent. The Bond Index Fund Unit Price as
of January 31, 1994 was determined by the Committee. The number
of Bond Index Fund Units as of January 31, 1994 was determined
by dividing the total amounts received by the Trustee pursuant
to Paragraphs VII and VIII hereof for investment in the Bond
Index Fund for the month of January, 1994 by such Bond Index
Fund Unit Price. Thereafter, the Bond Index Fund Unit Price
shall be redetermined each business day that is a trading day on
the New York Stock Exchange. The Bond Index Fund Unit Price for
each such business day shall be determined by dividing the net
asset value of the Bond Index Fund on such business day by the
number of Bond Index Fund Units outstanding on such business
day. Bond Index Fund Unit Prices shall be determined before
giving effect to any distribution or withdrawal and before
crediting contributions to members' accounts effective as of any
such business day. Net asset value of the Bond Index Fund shall
be computed as follows:
(i) All assets of the Bond Index Fund, including any interest in a
common, collective or commingled fund, shall be valued at the
fair market value as of the close of business on the valuation
date. Fair market value shall be determined by the Trustee in
the reasonable exercise of its discretion, taking into account
values supplied by a generally accepted pricing or quotation
service or quotations furnished by one or more reputable
sources, such as securities dealers, brokers, or investment
bankers, values of comparable property, appraisals or other
relevant information and, in the case of a common, collective or
commingled fund, fair market value shall be the
unit value of such fund for a date the same as the valuation
date, or as close thereto as practicable.
(ii) Bond Index Fund Units credited to members' accounts with
respect to Tax-Efficient Savings Contributions (including
Catch-Up Contributions) and/or After-Tax Contributions made
during any month shall be credited at the Bond Index Fund Unit
Price determined as of the close of business on the day that
such contributions are received by the Trustee. Bond Index Fund
Units withdrawn or distributed shall be valued at the Bond Index
Fund Unit Price at the close of business on the day coinciding
with the effective date of such withdrawal or distribution.
(iii) Investment transactions, income and any expenses chargeable to
the Bond Index Fund will be accounted for on an accrual basis.
(d) Distribution and Withdrawal From Bond Index Fund
The cash value of assets in the Bond Index Fund shall be
distributed to members or may be withdrawn by members only in
accordance with Paragraphs X and XII hereof. All distributions
and withdrawals shall be only in cash.
(e) Registered Name
Securities held in the Bond Index Fund may be registered in the
name of the Trustee or its nominee.
4. Interest Income Fund
The Trustee shall establish and manage the Interest Income Fund in
accordance with the following:
(a) Investments
For each member who elects pursuant to Paragraph VII to have
Tax-Efficient Savings Contributions (including Catch-Up
Contributions) and/or After-Tax Savings Contributions invested
in the Interest Income Fund or for whom a transfer is made as
provided in Paragraph VIII, the Trustee shall invest the sums so
to be invested or transferred in accordance with instructions of
one or more persons, companies, corporations or other
organizations appointed by the Company. The Trustee may be
appointed for such purpose.
Investments shall be made with the objective of providing a
broadly diversified, stable value investment in which the value
of the member's investment is not expected to fluctuate except
for the addition of interest credited to the member's account.
The interest rate payable on assets in the Interest Income Fund
will be declared annually in advance and may be changed each
calendar year.
The Trustee shall invest the After-Tax Savings and Tax-Efficient
Savings Contributions (including Catch-Up Contributions) , and
earnings thereon, received for the accounts of members who elect
to invest in the Interest Income Fund according to the advice of
the Interest Income Fund Advisor. Assets in such Fund shall be
invested in a well diversified portfolio of fixed income
securities. The Interest Income Fund will be allowed to use
derivatives (futures, options and swaps) to take advantage of
changes in securities prices, interest rates and other factors
affecting value and/or to maintain liquidity. While the use of
each of these strategies has its own risks and could decrease
the value of the Interest Income Fund, their use in the
portfolio is limited to controlling overall Interest Income Fund
risk and managing cash. Securities may be sold without regard to
the length of time they have been held. Investments shall be
subject to such additional restrictions as from time to time
shall be provided in the agreement designating or appointing the
Interest Income Fund Advisor. To the extent that the actual
return on assets in the Fund is more or less than the declared
rate of interest for the current year, the rate of interest
declared and paid for succeeding years will be adjusted upward
or downward.
Investments of a portion of Interest Income Fund assets may be
made in any common, collective or commingled fund maintained by
the Trustee or any person, company, corporation or other
organization appointed by the Company to manage all or a portion
of the Interest Income Fund when, in the opinion of the Trustee
or the person, company, corporation or other organization
appointed by the Company to manage all or a portion of the
Interest Income Fund, such investments are consistent with the
objective of the Interest Income Fund. To the extent that assets
are so invested, they shall be subject to the terms and
conditions of the Declaration of Trust of such common,
collective or commingled fund, as amended from time to time. A
portion of the funds of the Interest Income Fund may be held in
cash or invested in short-term obligations when deemed advisable
by the Trustee or the person, company, corporation or other
organization appointed by the Company to manage all or a portion
of the Interest Income Fund.
(b) The Trustee periodically shall credit to the appropriate Interest
Income Fund accounts of members interest at the rate declared prior
to the commencement of each calendar year.
(c) In the event that the total value of the Interest Income Fund is
reduced for any reason (other than by reason of distributions to or
withdrawals or transfers by members pursuant to the Plan), the
Trustee shall reduce the total amount credited to the Interest
Income Fund account of each member by a proportionate amount.
(d) Xxxx credited to members' accounts in the Interest Income Fund shall
be distributed to members or may be withdrawn by members only in
accordance with Paragraph X and XII hereof. All distributions and
withdrawals shall be only in cash.
(e) Interest Income Fund Value
The term "Value" as used herein shall mean the value in money of
the net assets in the Interest Income Fund. The Interest Income
Fund Value shall be determined each business day that is a
trading day on the New York Stock Exchange. Interest Income Fund
Values shall be determined before giving effect to any
distribution or withdrawal and before crediting contributions or
transfers to members' accounts effective as of any such business
day. The Value of the Interest Income Fund shall be computed as
follows:
(i) All assets of the Interest Income Fund shall be valued at the
fair market value as of the close of business on the valuation
date. Fair market value shall be determined by the Trustee in
the reasonable exercise of its discretion, taking into account
values supplied by a generally accepted pricing or quotation
service or quotations furnished by one or more reputable
sources, such as securities dealers, brokers, or investment
bankers, values of comparable property, appraisals or other
relevant information.
(ii) Investment transactions, income and any expenses chargeable to
the Interest Income Fund will be accounted for on an accrual
basis.
(f) Registered Name
Securities held in the Interest Income Fund may be registered in
the name of the Trustee or its nominee.
5. Mutual Funds
Each of the Mutual Funds offered as an investment election under the
Plan shall be described in a prospectus for each such Mutual Fund
and each such prospectus shall be provided to each member of the
Plan who requests such prospectus.
XIV. Member's Quarterly Statement
As soon as practicable after the end of each calendar quarter of each year,
there shall be furnished to each member a statement as of the end of each
such quarter of such year of the cash value of each of the investments in
his or her account, the contributions made on behalf of such member during
the preceding calendar quarter, the investment elections with respect to
such contributions, and such additional information as the Committee shall
determine. Such statements shall be deemed to have been accepted by the
member and his or her beneficiaries designated hereunder as correct unless
written notice to the contrary shall be received as the Company shall
specify on such statement within 30 days after the mailing of such statement
to the member.
XV. Notices, etc.
All notices, statements and other communications from the Trustee or a
Participating Company to an employee, member or designated beneficiary
required or permitted hereunder
shall be deemed to have been duly given, furnished, delivered or
transmitted, as the case may be, when delivered to (or when mailed by
first-class mail, postage prepaid and addressed to) the employee, member or
beneficiary at his or her address last appearing on the books of such
Participating Company or, in the case of an employee, delivered to the
employee at his or her normal work station.
All notices, instructions and other communications from an employee or
member to the Company or Trustee required or permitted hereunder (including,
without limitation, authorizations, Tax-Efficient Savings elections and
terminations thereof, investment and other elections, requests for
withdrawal or loans and designations of beneficiaries and revocations and
changes thereof) shall be made in such form and such manner from time to
time prescribed therefor by the Committee.
From time to time as necessary to facilitate the administration of the Plan
and the trust created thereunder, the Company, the Trustee and the Committee
shall deliver to each other copies or consolidations of such notices,
instructions or other communications in respect of the Plan or such trust as
it may receive from employees, members or beneficiaries.
XVI. Trustee
The Company shall appoint one or more individuals or corporations to act as
Trustee under the Plan, and at any time may remove the Trustee and appoint a
successor Trustee. The Company may, without reference to or action by any
employee, member or beneficiary or any other Participating Company, enter
into such Trust Agreement with the Trustee and from time to time enter into
such further agreements with the Trustee or other parties, make such
amendments to such Trust Agreement or further agreements and take such other
steps and execute such other instruments as the Company in its sole
discretion may deem necessary or desirable to carry the Plan into effect or
to facilitate its administration.
The Trustee and the Company may by mutual agreement in writing arrange for
the delegation by the Trustee to the Committee of any of the functions of
the Trustee, except the custody of assets, the voting of Company stock held
by the Trustee and the purchase and sale or redemption of securities.
The Trustee shall agree that all information concerning a member's
investment in the Plan, exchanges in or out of the investement elections, or
the voting of shares of stock represented by a member's proportionate
interest in the Ford Stock Fund or any other investment under the Plan shall
not be disclosed to any party except to the extent necessary to administer
the Plan or as required by law. The Committee shall be responsible for
ensuring that the provisions of this subparagraph are complied with and
shall have the authority to determine, in good faith, when and to what
extent disclosure shall be necessary in administering the Plan.
XVII. Purchases of Securities by the Trustee
Tax-Efficient Savings, Catch-Up Contributions and After-Tax Savings
Contributions and earnings thereon in the accounts of members shall be
invested by the Trustee as soon as practicable after receipt thereof by the
Trustee.
The shares of Company stock from time to time required for purposes of the
Plan shall be purchased by the Trustee from the Company, or from such other
person or corporation, on such stock exchange or in such other manner, as
the Company by action of its Board of Directors or any committee or person
designated by the Board of Directors, from time to time in its sole
discretion may designate or prescribe; provided, however, that except as
required by any such designation by the Board of Directors, such shares
shall be purchased by the Trustee from such source and in such manner as the
Trustee from time to time in its sole discretion may determine. Any shares
so purchased from the Company may be either treasury stock or newly-issued
stock, and shall be purchased at a price per share equal to the closing
price on the New York Stock Exchange on the date of purchase.
Anything herein to the contrary notwithstanding, the Trustee shall not
invest any of the funds in the Ford Stock Fund in any shares of Company
stock, unless at the time of purchase thereof by the Trustee such shares
shall be listed on the New York Stock Exchange.
The shares of Company stock held by the Trustee under the Plan shall be
registered in the name of the Trustee or its nominee, but shall not be voted
by the Trustee or such nominee except as provided in Paragraph XVIII hereof.
In the event that any option, right or warrant shall be received by the
Trustee on Company stock, the Trustee shall sell the same, at public or
private sale and at such price and upon such other terms as it may
determine, unless the Committee shall determine that such option, right or
warrant should be exercised, in which case the Trustee shall exercise the
same upon such terms and conditions as the Committee may prescribe.
XVIII. Voting of Company Stock
The Trustee, itself or by its nominee, shall be entitled to vote, and shall
vote, shares of Company stock represented by the proportionate interests in
the accounts of members in the Ford Stock Fund or otherwise held by the
Trustee under the Plan as follows:
l. The Company shall adopt reasonable measures to notify the member of the
date and purposes of each meeting of stockholders of the Company at
which holders of shares of Company stock shall be entitled to vote, and
to request instructions from the member to the Trustee as to the voting
at such meeting of full shares of Company stock and fractions thereof
represented by the proportionate interest in the Ford Stock Fund account
of the member.
2. In each case, the Trustee, itself or by proxy, shall vote full shares of
Company stock and fractions thereof represented by the proportionate
interest in the Ford Stock Fund account of the member in accordance with
the instructions of the member.
3. If prior to the time of such meeting of stockholders the Trustee shall
not have received instructions from the member in respect of any shares
of Company stock represented by the proportionate interest in the Ford
Stock Fund account of the member, the Trustee shall vote thereat such
shares proportionately in the same manner as the Trustee votes thereat
the aggregate of all shares of Company stock with respect to which the
Trustee has received instructions from members.
XIX. Cash Adjustments on Account of Fractional Interests in Securities
Any fractional interest in a share of Company stock shall not be subject to
distribution or withdrawal. Settlement for any fractional interest in such
security, upon distribution or withdrawal thereof, shall be made in cash
based on the current market value or any applicable current redemption value
of such security, as of the date of distribution or withdrawal, as the case
may be.
XX. Operation and Administration
Pursuant to ERISA, the Company shall be the sole named fiduciary with
respect to the Plan and shall have authority to control and manage the
operation and administration of the Plan.
The Vice President-Human Resources, the Vice President-Finance and Treasurer
and the Vice President-General Counsel shall have the authority, on behalf
of the Company, to appoint and remove trustees under the Plan, to approve
policies relating to the allocation of contributions and the distribution of
assets among trustees, and to approve Plan amendments other than Plan
amendments relating to the offering of Company stock as an investment
election which amendments shall be made by the Board of Directors.
The Vice President-Finance and Treasurer shall be authorized on behalf of
the Company to contract with the trustees under the Plan and to determine
the form and terms of the trust agreements, to allocate contributions and
distribute assets among trustees, and to appoint an auditor under the Plan,
and shall have authority to designate other persons to carry out specific
responsibilities in connection therewith; provided, however, that such
actions shall be consistent with ERISA, the policy of the Board of Directors
and officers designated in the preceding subparagraph and the Plan.
Except as otherwise provided in this Paragraph XX or elsewhere in the Plan,
the Vice President-Human Resources and the Vice President-Finance and
Treasurer are designated to carry out the Company's responsibilities with
respect to the Plan, including, without limitation, appointment and removal
of members of the Committee and determination of prior service for
eligibility purposes under the Plan in the event of acquisition by a
Participating Company (by purchase, merger, or otherwise) of all or part of
the assets of another corporation. The Vice President-Human Resources and
the Vice President-Finance and Treasurer may allocate responsibilities
between themselves and may designate other persons to carry out specific
responsibilities on behalf of the Company.
Any Company director, officer or employee who shall have been expressly
designated pursuant to the Plan to carry out specific Company
responsibilities shall be acting on behalf of the Company. Any person or
group of persons may serve in more than one capacity with respect to the
Plan and may employ one or more persons to render advice with regard to any
responsibilities such person has under the Plan.
The Company shall create a Committee consisting of at least three members.
The Company shall from time to time designate the members of the Committee
and an alternate for each of such members, who shall have full power to act
in the absence or inability to act of such member. The Committee shall
appoint its own Chairman and Secretary, and shall act by a majority of its
members, with or without a meeting. The Secretary or an Assistant Secretary
of the Company shall from time to time notify the Trustee of the appointment
of members of the Committee and alternates and of the appointment of the
Chairman and Secretary of the Committee, upon which notices the Trustee
shall be entitled to rely.
The Committee shall have full power and discretionary authority to
administer the Plan and to interpret its provisions. Any interpretation of
the provisions of the Plan by the Committee shall be final and conclusive,
and shall bind and may be relied upon by the several Participating
Companies, each of their employees, the Trustee and all other parties in
interest.
No member of the Committee or alternate for a member or director, officer or
employee of any Participating Company shall be liable for any action or
failure to act under or in connection with the Plan, except for his or her
own lack of good faith; provided, however, that nothing herein shall be
deemed to relieve any such person from responsibility or liability for any
obligation or duty under ERISA. Each director, officer, or employee of the
Company who is or shall have been designated to act on behalf of the Company
and each person who is or shall have been a member of the Committee or an
alternate for a member or a director, officer or employee of any
Participating Company, as such, shall be indemnified and held harmless by
the Company against and from any and all loss, cost, liability or expense
that may be imposed upon or reasonably incurred by him or her in connection
with or resulting from any claim, action, suit or proceeding to which he or
she may be a party or in which he or she may be involved by reason of any
action taken or failure to act under the Plan and against and from any and
all amounts paid by him or her in settlement thereof (with the Company's
written approval) or paid by him or her in satisfaction of a judgment in any
such action, suit or proceeding, except a judgment in favor of the Company
based upon a finding of his or her lack of good faith; subject, however, to
the condition that, upon the assertion or institution of any such claim,
action, suit or proceeding against him or her, he or she shall in writing
give the Company an opportunity, at its own expense, to handle and defend
the same before he or she undertakes to handle and defend it on his or her
own behalf. The foregoing right of indemnification shall not be exclusive of
any other right to which such person may be entitled as a matter of law or
otherwise, or any power that a Participating Company may have to indemnify
him or her or hold him or her harmless.
Brokerage commissions, fees and transfer taxes incurred in connection with
the purchase or sale of Company stock shall be paid by the Company.
Brokerage commissions and transfer taxes on the purchase and sale of Common
Stock Index Fund securities shall be paid from
Common Stock Index Fund assets by the Trustee, and the expenses of any
collective, common, or commingled fund in which Common Stock Index Fund
assets may be invested pursuant to Subparagraph 2 of Paragraph XIII hereof
shall be paid from the assets in such collective, common or commingled fund.
Brokerage commissions and transfer taxes on the purchase and sale of Bond
Index Fund securities and the expenses of the Bond Index Fund including,
without limitation, investment management fees shall be paid from Bond Index
Fund assets, and the expenses of any collective, common, or commingled fund
in which Bond Index Fund assets may be invested pursuant to Subparagraph 3
of Paragraph XIII hereof shall be paid from the assets in such collective,
common or commingled fund. Earnings credited to the account of the Trustee
under the Bond Index Fund shall be net of such charges by the Bond Index
Fund Manager as may be provided in such contract. Brokerage commissions and
transfer taxes on the purchase and sale of Interest Income Fund securities
shall be paid from Interest Income Fund assets by the Trustee and the
expenses of any collective, common, or commingled fund in which Interest
Income Fund assets may be invested pursuant to Subparagraph 4 of
Paragraph XIII hereof shall be paid from the assets in such collective,
common or commingled fund. All management fees, redemption fees and all
other expenses of any mutual funds offered as an investment election under
the Plan shall be paid from assets in such mutual funds or charged to the
accounts of members who elect to invest in such mutual funds. All other
expenses of administration of the Plan, including expenses charged or
incurred by the Trustee or the Company, shall be borne by the Company.
Taxes, if any, on any Ford Stock Fund Units, Common Stock Index Fund Units
or Bond Index Fund Units held by the Trustee or income therefrom which are
payable by the Trustee shall be charged against the members' accounts as the
Trustee and the Committee shall determine.
The records of the Trustee, the Committee and the several Participating
Companies shall be conclusive in respect of all matters involved in the
administration of the Plan.
The Company, by action of the Vice President-Finance and Treasurer, the
Vice President-Human Resources, and the Vice President-General Counsel shall
create an Investment Process Committee. The Investment Process Committee
shall:
(a) Recommend investment process guidelines to the Vice Presidents for
their approval;
(b) Review the investment process guidelines for continuing
appropriateness;
(c) Recommend changes to the guidelines for approval by the
Vice Presidents;
(d) Review the performance of investment options pursuant to the
investment process guidelines and make recommendations regarding the
addition to, deletion from, or replacement of investment options
under the Plan; and
(e) Review the overall line-up of investment options to ensure that, in
total, the Plan's objectives are achieved.
The Investment Process Committee shall be responsible for maintaining the
investment options under the plan solely in the interest of the Plan's
members and their beneficiaries.
Where Federal law does not control, the Plan shall be governed by and
construed in accordance with the laws of the State of Michigan.
XXI. Termination, Suspension and Modification
The Company, by action of its Board of Directors, or officers designated
under Paragraph XX hereof, may terminate or modify the Plan or suspend the
operation of any provision of the Plan, as follows:
1. The Company may terminate the Plan at any time or may at any time or
from time to time modify the Plan, in its entirety or in respect of the
employees of one or more of the Participating Companies. The Company may
at any time or from time to time terminate or modify the Plan or suspend
for any period the operation of any provision thereof, in respect of any
employees located in one or more states or countries, if in the judgment
of the Committee compliance with the laws of such state or country would
involve disproportionate expense and inconvenience to a Participating
Company. Any such modification that affects the rights or duties of the
Trustee may be made only with the consent of the Trustee. Any such
termination, modification or suspension of the Plan may affect members
in the Plan at the time thereof, as well as future members, but may not
affect the rights of a member as to the continuance of investment,
distribution or withdrawal of the cash value of assets in the account of
the member as of the effective date of such termination, modification or
suspension and earnings thereon; provided, however, that the Company
may, in the event of a termination of the Plan, direct the Trustee to
distribute the assets in the accounts of members in the Plan to such
members. Any termination or modification of the Plan or suspension of
any provision thereof shall be effective as of such date as the Company
may determine, but not earlier than the date on which the Company shall
give notice of such termination, modification or suspension to the
Trustee and to the Participating Companies any of the employees of which
are affected thereby.
2. The provisions of the foregoing Subparagraph 1 notwithstanding, the
Company, by action of its Vice President-Human Resources, Vice
President-Finance and Treasurer and Vice President-General Counsel, at
any time or from time to time may modify any of the provisions of the
Plan in any respect retroactively, if and to the extent necessary or
appropriate in the judgment of such officers of the Company to qualify
or maintain the Plan and the trust fund established thereunder as a plan
and trust meeting the requirements of Section 401(a) and 501(a) of the
Internal Revenue Code of 1986, as now in effect or hereafter amended, or
any other applicable provisions of Federal tax laws or other
legislation, as now in effect or hereafter amended or adopted, and the
regulations thereunder at the time in effect.
3. Anything herein to the contrary notwithstanding, no such termination or
modification of the Plan or suspension of any provision thereof may
diminish the cash value of assets in the account of a member as of the
effective date of such termination, modification or suspension.
4. In the event of any merger or consolidation with, or transfer of assets
or liabilities to, any other plan, each employee member, former
employee, former member, beneficiary or estate eligible under the Plan
shall, if the Plan is then terminated, receive a benefit immediately
after the merger, consolidation or transfer, which is equal to the
benefit he or she would have been entitled to receive immediately before
the merger, consolidation or transfer if the Plan had then terminated.
XXII. Conditions on Participation of Subsidiaries of the Company
The consent of the Company to the participation in the Plan of any
Subsidiary of the Company may be conditioned upon such provisions as the
Company may prescribe, including, without limitation, conditions as to (a)
the instruments to be executed and delivered by such Participating Company
to the Trustee, (b) the extent to which the Company shall act as
representative of such Participating Company under the Plan, and (c) the
rights of such Participating Company to withdraw from participation in the
Plan and the effect of such with- drawal upon the memberships and accounts
in the Plan of employees of such Participating Company.
XXIII. Member's Rights Not Transferable
No right or interest of any member under the Plan or in his or her account
shall be assignable or transferable, in whole or in part, either directly or
by operation of law or otherwise, including, without limitation, by
execution, levy, garnishment, attachment, pledge or in any other manner,
except in accord with provisions of a qualified domestic relations order as
defined by Section 414(p) of the Internal Revenue Code of 1986 and Section
206(d) of ERISA and further excluding devolution by death or mental
incompetency; no attempted assignment or transfer thereof shall be
effective; and no right or interest of any member under the Plan or in his
or her account shall be liable for, or subject to, any obligation or
liability of such member.
XXIV. Designation of Beneficiaries
(1) A member may file with the Company a written designation of a
beneficiary or beneficiaries with respect to all or part of the assets
in the member's account. In the case of a married member who dies, the
cash value of assets in such member's account shall be delivered to such
member's surviving spouse unless the written designation of beneficiary
designating a person or persons other than the spouse with respect to
all or part of the assets in the member's account includes the written
consent of the spouse, witnessed by a notary public. A member, if
married, with such written consent of the spouse, may from time to time
revoke or change any such designation of beneficiary.
(2) In the case of an unmarried member who does not file a written
designation of beneficiary, such member shall be deemed to have
designated as beneficiary or beneficiaries under the Plan the person or
persons who are entitled in the event of the member's death to receive
the proceeds under the Company's Group Life and Disability Insurance
Program if the member is covered under such Program at the date of his
or her death.
(3) In the event of the death of a member, the cash value of assets in his
or her account under the Plan shall be delivered to, as applicable, such
spouse or beneficiaries who shall survive the member, in accordance with
the applicable designation (to the extent effective and enforceable at
the time of the member's death) and the provisions of the Plan, subject
to such regulations as the Committee from time to time may prescribe in
respect of distributions to minors; provided, however, that if the
Trustee or the Committee shall be in doubt as to the right of any such
person to receive any of the cash value of such assets, the Trustee may
deliver the same to the estate of the member, in which case the Trustee,
the several Participating Companies and the Committee and the several
members thereof and alternates for members shall not be under any
further liability to anyone. Except as hereinabove provided, in the
event of the death of a member, the cash value of assets in his or her
account under the Plan shall be delivered to his or her estate.
XXV. Limitation on Contributions under Section 415 of the Internal Revenue Code
Notwithstanding any other provision of the Plan, the sum of any
Tax-Efficient Savings and After-Tax Savings Contributions for any limitation
year shall not exceed the applicable limits set by Section 415 of the
Internal Revenue Code and the regulations thereunder. Additionally, prior to
January 1, 2000, the combined limitation of Section 415(e) of the Internal
Revenue Code will be administered so that a member's defined benefit plan
fraction and defined contribution plan fraction will not exceed 1.0 in any
limitation year and will be accomplished by reducing the rate of benefit
accruals under the defined benefit plan so that the sum of the fractions
equals 1.0. Thereafter, such combined limitation shall not apply. For
purposes of this Paragraph XXV, "limitation year" shall mean the 12-month
period beginning April 1.
XXVI. Transfer of Assets to or from the Plan
Notwithstanding any other provisions of the Plan, and subject to such
regulations and procedures as the Committee may prescribe, assets may be
transferred to the Plan from the Tax Reduction Act Stock Ownership Plan for
Hourly Employees in the United States or the Tax Reduction Act Stock
Ownership Plan for Salaried Employees or any other similar plan maintained
by the Company or its subsidiaries. If any cash or securities shall be
delivered to the Trustee by the trustee under any of such plans, effective
on or after April 30, 1989, the Trustee shall receive and hold such assets
in the Plan trust and shall credit them to accounts in the Plan for
employees on whose behalf such assets have been transferred. Assets received
in cash shall be invested in the Current Interest Fund, or its successor.
Thereafter all such assets shall be subject to all provisions of the Plan
applicable to any other assets credited to the accounts of members.
A member may elect to have the Plan accept a transfer from a savings plan of
a subsidiary where the member was previously employed of any fully vested
amounts, either in the form of cash or Company stock, provided that such
acceptance would not require the Plan to provide benefits in an amount or
form not otherwise provided under the Plan in order to preserve an accrued
benefit under the transferor plan. Xxxxxxx transferred would be invested in
accordance with the member's election among investment elections available
under the Plan made at the time of election to have assets transferred.
Thereafter, all such assets shall be subject to all provisions of the Plan
applicable to any other assets credited to the accounts of members.
A member who is no longer eligible to contribute to the Plan may elect to
have transferred from the Plan all, but not less than all, assets in such
member's account under the Plan, either in the form of cash or Company
stock, to a savings plan of a subsidiary where the member is currently
employed, subject to acceptance by the transferee plan.
XXVII. Employee Stock Ownership Plan
1. There was established in the Plan an Employee Stock Ownership Plan
("ESOP") effective January 1, 1989. The ESOP consists of all the shares
of Company stock in the Plan at any time and from time to time including
all the shares in the Ford Stock Fund, shares formerly allocated to
members' accounts and shares held in the suspense account as hereinafter
described and all assets attributable to contributions made after
December 31, 1988.
2. The trustee of the ESOP shall be the Trustee of the Plan or such other
qualified organization as the Company shall select (the "Trustee of the
ESOP"). The Trustee of the Plan and the Trustee of the ESOP shall hold,
invest, transfer and distribute the shares of Company stock and all
other assets in the ESOP in accordance with the provision of this
Paragraph XXVII and the Plan. In the event the Company selects an
organization other than the Trustee of the Plan to be Trustee of the
ESOP, their duties under the ESOP shall be allocated between them as
hereinafter provided or in accordance with the provisions of the trust
agreements appointing such Trustee of the Plan and Trustee of the ESOP.
3. (i) The Trustee of the ESOP shall borrow on behalf of the ESOP an amount
not exceeding the amount of dividends estimated by the Trustee of the
ESOP, after consultation with the Trustee of the Plan and the Treasurer
of the Company, to be paid on Company stock held continuously since
January 1, 1989 in the ESOP for such period as the Trustee of the ESOP
shall select, subject to a guarantee by the Company of payment of any
such loan.
(ii) The Trustee of the ESOP is authorized to borrow such amount from
such persons, including the Company, as the Trustee of the ESOP
shall determine. The loan shall provide for repayment, within such
period as the Trustee of the ESOP shall have selected, and shall be
payable on such other terms as the Trustee of the ESOP in its sole
discretion shall determine. The interest rate of a loan must not be
in excess of a reasonable rate of interest.
(iii) The proceeds of any such loan shall be used by the Trustee of the
ESOP to purchase as soon as practicable shares of Company stock in
accordance with the provisions of Paragraph XVII hereof. The Trustee
of the ESOP is authorized to pledge such stock as security for
payment of such loan. The loan shall be without recourse against the
ESOP.
4. The Trustee of the ESOP shall hold the shares of Company stock so
purchased in the Plan in a suspense account unallocated until such time
as all or part of the related loan and interest thereon is paid as
hereinafter provided. The Trustee of the ESOP shall vote shares of
Company stock in the suspense account in its discretion, notwithstanding
the provisions of Paragraph XVIII hereof.
5. The Trustee of the Plan and the Trustee of the ESOP shall apply
dividends paid on Company stock held in the ESOP with respect to which a
loan was taken, including shares held in the Ford Stock Fund, to payment
of such loan made in accordance with Subparagraph 3 hereof and interest
thereon.
In the event that such dividends paid on Company stock are not
sufficient to enable the Trustee of the ESOP to make any payment on
such loan the Trustee of the ESOP shall sell shares of Company stock
held in the suspense account in an amount necessary to permit such
payment provided, however, that the Company may elect to make an
additional contribution to the Plan by making payment to the Trustee
of the ESOP in an amount sufficient to enable the Trustee of the
ESOP to make all or part of such payment without selling shares of
Company stock held in the suspense account.
In the event that such dividends paid on Company stock and the
amount realized from the sale of Company stock held in the suspense
account are not sufficient to enable the Trustee of the ESOP to make
any payment on such loan, the Company shall make an additional
contribution to the Plan by making payment to the Trustee of the
ESOP in an amount sufficient to enable the Trustee of the ESOP to
make such payment or shall pay such amount to the lender.
6. The shares held in the suspense account shall be released from the
suspense account to the Trustee of the Plan in an amount that bears the
same ratio to the total number of shares in the suspense account as the
amount of principal and interest paid on the loan bears to the total
amount of principal and interest outstanding. The Trustee of the Plan
shall allocate such shares so released to the Ford Stock Fund and the
accounts of members who have elected to invest in the Ford Stock Fund
shall be adjusted as if the dividends paid on Company stock with respect
to shares held in the Ford Stock Fund had been used to acquire shares of
Company stock in the open market on the last day of the month preceding
the date such shares are released from the suspense account.
To the extent that the number of shares released from the suspense
account at any time is less than the number that would be required
for allocation to the Ford Stock Fund if the dividends paid on
Company stock had been used to acquire shares of Company stock in
the open market at the closing price on the New York Stock Exchange
on the
dividend payment date, the Trustee of the ESOP shall release
additional shares from the suspense account so that the value at the
closing price on the New York Stock Exchange on the dividend payment
date of the total number of shares released to the Trustee of the
Plan for the Ford Stock Fund shall equal the total of (a) the
dividends paid to the Trustee of the ESOP by the Trustee of the Plan
with respect to Company Stock held in the Ford Stock Fund and (b)
the dividends received by the Trustee of the ESOP with respect to
Company Stock held in the suspense account. If there are not enough
additional shares in the suspense account to satisfy the requirement
of the immediately preceding sentence, the Company shall make an
additional contribution to the Plan in an amount sufficient to
permit the Trustee of the ESOP to acquire additional shares so that
the value at the closing price on the dividend payment date of the
shares released to the Trustee of the Plan plus cash, if any, shall
equal the dividends paid by the Trustee of the Plan with respect to
Company Stock to the Trustee of the ESOP. If at the end of any Plan
Year, or after the final payment of any loan effected pursuant to
Subparagraph 3 above, additional shares of Company Stock have been
released from the suspense account during the Plan Year to satisfy
the requirements of the first sentence of this paragraph and there
is not at the end of the Plan Year an excess of shares as described
in the immediately following paragraph at least equal in value to
the value of the additional shares released (measured as provided in
the first sentence of this paragraph) previously in the Plan Year,
the Company shall make an additional contribution to the Plan so
that the total value of the excess shares described in the
immediately following paragraph and the contribution equals the
value (as determined in the first sentence of this paragraph) of the
additional shares released.
To the extent that the number of shares released from the suspense
account at any time exceeds the number that would be required if the
dividend paid on Company stock had been used to acquire shares of
Company stock in the open market, the excess shall be held by the
Trustee of the ESOP and released at the end of the calendar year to
the Trustee of the Plan for an addition to the Ford Stock Fund and
allocation of additional units in the Ford Stock Fund to the
accounts of members in an amount proportional to the number of Ford
Stock Fund units in their accounts.
7. Contributions to the ESOP for any eligible employee who is a highly
compensated employee shall be limited to the extent required under the
principles described in Paragraph IV with respect to Tax-Efficient
Savings Contributions.
8. The Committee is authorized to make such adjustments in the
administration of the Plan and the ESOP as it deems necessary,
appropriate or desirable to carry out the purposes and intents of this
Paragraph XXVII.
9. In the event that any or all of the tax benefits available under the tax
laws on the effective date hereof are restricted or eliminated, as
determined by the Company, the Trustee of the ESOP is authorized upon
direction by the Company to sell upon such terms, at such times and to
such persons, as the Trustee of the ESOP in its sole discretion shall
determine, any
or all of the shares of Company stock in the suspense account and to use
the proceeds of such sale to pay all or part of the loan balance
outstanding, together with interest thereon. Any excess shares in the
suspense account at such time shall be allocated as provided in
Subparagraph 6 hereof.
XXVIII. Claim Procedure
(a) Denial of a Claim
A claimant shall make a claim for benefits or participation by
making a request in accordance with the Plan. If a claim for
benefits or participation is denied in whole or in part, the
claimant will receive written notification from the third party
plan administrator within ninety (90) days from the date the
claim for benefits or participation is received. Such notice
shall be deemed given upon mailing, full postage prepaid in the
United States mail or if provided electronically to the
claimant. Any actual denial of a claim under this Plan shall be
written and set forth in a manner calculated to be understood by
the claimant. The denial of claim shall include (i) the specific
reason or reasons for the denial; (ii) specific reference to
pertinent Plan provisions on which the denial is based along
with a copy of such Plan provisions or a statement that one will
be furnished at no charge upon the claimant's request; (iii) a
description of any additional material or information necessary
for the claimant to perfect the claim and an explanation of why
such material or information is necessary; and (iv) appropriate
information as to the steps to be taken if the claimant wishes
to submit his or her claim for review, along with a statement of
the claimant's right to bring a civil action under Section
502(a) of ERISA following an adverse benefit determination on
review. If the third party plan administrator determines that an
extension of time for processing is required, written notice of
the extension shall be furnished to the claimant prior to the
termination of the initial ninety (90) day period. In no event
shall such extension exceed a period of ninety (90) days from
the end of such initial period. The extension notice shall
indicate the special circumstances requiring an extension of
time and the date by which the Plan expects to render the
determination.
(b) Review of Denial of the Claim by the Committee
In the event that the third party plan administrator denies a
claim, a claimant may (i) request a review upon appeal by
written application to the Committee; (ii) review pertinent
documents; and (iii) submit issues and comments in writing. A
claimant must request a review upon an appeal of the denial of
the claim by the third party plan administrator under this Plan
within sixty (60) days after the claimant receives the written
notification of denial of the claim. Since the Committee is
reviewing the appeal, it will be considered at the
Committee's next regularly scheduling meeting. If it is filed
within thirty (30) days of the next meeting, a decision by the
Committee shall be made by the date of the second meeting after
receipt of the claimant's request for review. Under special
circumstances an extension of time for processing may be
required, in which case a decision shall be rendered by the date
of the third meeting. If an extension is required because
information is incomplete, the review period will be tolled from
date the notice was sent to the date information is received. In
the event such an extension is needed, written notice of the
extension shall be provided to the claimant prior to the
commencement of the extension. Written notice of a decision will
be made not any later than five (5) days after the decision has
been made by the Committee. The decision on review shall be in
writing in a manner calculated to be understood by the claimant,
and include (i) the specific reason or reasons for the denial;
(ii) specific reference to pertinent Plan provisions on which
the denial is based along with a copy of such Plan provisions or
a statement that one will be furnished at no charge upon the
claimant's request; (iii) a statement that the claimant is
entitled to receive, upon request and free of charge, reasonable
access to, and copies of, all documents, records, and other
information relevant to the claimant's claim for benefits; and
(iv) a statement of the claimant's right to bring a civil action
under Section 502(a) of ERISA following an adverse benefit
determination on review. Decisions of the Committee are final
and conclusive and are only subject to the arbitrary and
capricious standard of judicial review.
XXIX. Limitation on Claims
No legal action may be brought by a participant, dependent, beneficiary, or
the estate or legal representative thereof for entitlement to benefits under
the Plan, until after the claims and appeals procedures of the Plan have
been exhausted, and, unless a different period of limitation is specifically
provided under ERISA, no later than two years after such claim has accrued.
No other actions may be brought against the Plan more than six months after
such claim has accrued.
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Appendix A
Additional Mutual Funds
LIFE STAGE FUNDS:
Fidelity Freedom Income Fund
Fidelity Freedom 2000 Fund
Fidelity Freedom 2010 Fund
Fidelity Freedom 2020 Fund
Fidelity Freedom 2030 Fund
Fidelity Freedom 2040 Fund
EQUITY FUNDS - PASSIVELY MANAGED:
BGI EAFE Equity Index Fund
Domini Social Equity Fund
U.S. Extended Market Index Fund
Vanguard Institutional Index Trust - Institutional Plus Shares
EQUITY FUNDS - ACTIVELY MANAGED - DOMESTIC:
Fidelity Capital Appreciation Fund
Fidelity Contrafund
Fidelity Dividend Growth Fund
Fidelity Equity - Income Fund
Fidelity Growth Company Fund
Fidelity Magellan Fund
Fidelity Real Estate Investment Portfolio
INVESCO Dynamic Fund - Investor Class
Janus Aspen Growth - Portfolio Institutional
Xxxxxxxxx Xxxxxx Genesis Fund - Investor Class
Oakmark Select I Fund
Royce Low-Priced Stock Fund
Vanguard Explorer Fund - Admiral Class
EQUITY FUNDS - ACTIVELY MANAGED - INTERNATIONAL:
Citizens Global Equity Institutional - Fund
Fidelity Overseas Fund
Xxxxx Xxxxx International Growth Fund - Institutional
Xxxxxx Xxxxxxx Institutional Global - Value Equity A Fund
X. Xxxx Price International Discovery - Fund
Xxxxxxxxx Foreign A Fund
FIXED INCOME:
PIMCO Real Return Bond A
PIMCO Total Return Administrative
X. Xxxx Price High-Yield
