RETIREMENT
SAVINGS EXCESS BENEFIT PLAN
(as
Amended and Restated Effective January 1, 2009)
The
BorgWarner Retirement Savings Plan (the “RSP”) was
established by BorgWarner Inc., to provide its employees and the
employees of its subsidiaries and affiliates with a method of
long-term savings. This BorgWarner Retirement Savings Excess
Benefit Plan (the “Excess Plan” or “Plan”)
was established to provide benefits to certain employees whose
participation in and benefits under the RSP are limited by
provisions in the Internal Revenue Code of 1986, as amended,
including, without limitation, Sections 401(a)(17), 401(k)(3),
401(m), 402(e) and 415 of the Code.
The
Excess Plan was originally established effective as of
January 27, 1993 as the Borg-Warner Automotive Inc. Retirement
Excess Savings Excess Benefit Plan and since renamed the BorgWarner
Inc. Retirement Savings Excess Benefit Plan. This amendment and
restatement of the Plan is effective January 1,
2009.
For
purposes of this Excess Plan, the use of terms defined in the RSP
shall have the same meaning when used herein, and the following
terms, when used herein, shall have the following meanings, unless,
in either case, the context clearly indicates otherwise.
2.01
Account . The term “Account” means, with respect
to any Participant, the Participant’s Supplementary Company
Retirement Account and the Participant’s Supplementary
Savings Account.
2.02
Beneficiary . The term “Beneficiary” means the
person, persons or trust designated to receive a benefit under the
RSP after the death of a Participant.
2.03
Code . The term “Code” means the United States
Internal Revenue Code of 1986 and any successor thereto.
2.04
Code Section 409A . The term “Code
Section 409A means Section 409A of the Code, and the
regulations and other guidance issued by the Treasury Department
and the Internal Revenue Service thereunder.
2.05
Company . The term “Company” means,
individually, the Corporation and the Corporation’s
divisions, subsidiaries, joint ventures and affiliates which are
participating in the Excess Plan. Divisions of the Corporation
shall participate in the Excess Plan as determined from time to
time by the Committee. Subsidiaries and affiliates shall
participate in the Excess Plan by taking appropriate corporate
action with the Committee’s consent.
2.06
Compensation . The term “Compensation” means the
regular salary, overtime pay and any bonus during any Plan Year;
provided, however, that for purposes of determining the amount
credited to the Supplemental Retirement Accounts under
Sections 5 and 6 hereof, the Compensation of each Participant
shall include such Participant’s Before-Tax Contributions
under the RSP, and such term shall not be limited to the maximum
amount of the Participant’s Compensation taken into
consideration for purposes of the RSP.
2.07
Employee . The term “Employee” means an Employee
of the Company as defined in the RSP.
2.08
Participant . The term “Participant” means any
Employee participating in the RSP (i) whose annual
compensation is equal to or in excess of the
Section 401(a)(17) compensation limit or more, and
(ii) whose participation in and benefits under the RSP are
limited by provisions in the Code, including, without limitation,
Sections 401(a)(17), 401(k)(3), 401(m), 402(g)(1) and 415 of
the Code.
2.09
Plan Year . The term “Plan Year” means the
accounting year of the RSP, which is maintained on a January 1
through December 31 basis.
2.10
Pre-2005 Account Balance . The Term “Pre-2005 Account
Balance” means the amounts credited to the Excess Plan on
behalf of a Participant prior to January 1, 2005, and earnings
thereon, that were vested as of December 31, 2004.
2.11
Post-2004 Account Balance . The Term “Post-2004
Account Balance” means the amounts credited to the Excess
Plan on behalf of a Participant on or after January 1, 2005 or
that vested on or after January 1, 2005, and earnings
thereon.
2.12
Separation from Service . the term “Separation from
Service” means the date on which a Participant dies, retires,
or otherwise has a termination of employment from the Company
within the meaning of Code Section 409A and Treasury
Regulation Section 1.409A-1(h), or its
successor.
2.13
Supplementary Company Retirement Account . The term
“Supplementary Company Retirement Account” means the
account maintained for a Participant to which is credited the
amount determined under Section 5 hereof, adjusted as
determined under Section 10 hereof.
2.14
Supplementary Savings Account . The term
“Supplementary Savings Account” means the account
maintained for a Participant to which is credited the amount
determined under Section 6 hereof, adjusted as determined
under Section 10 hereof
2.15
Unforeseeable Emergency . The term “Unforeseeable
Emergency” means a severe financial hardship to the
Participant resulting from an illness or accident of the
Participant, the Participant’s spouse, the
Participant’s dependent (as defined in Code Section 152,
without regard to Section 152(b)(1), (b)(2), and (d)(1)(B)),
or a Beneficiary; loss of the Participant’s property due to
casualty (including the need to rebuild a home following damage to
a home not otherwise covered by insurance, for example, as a result
of a natural disaster); or other similar extraordinary and
unforeseeable circumstances arising as a result of events
beyond
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the
control of the Participant. The types of events which may qualify
as an Unforeseeable Emergency may be limited by the
Committee.
2.16
Valuation Date . The term “Valuation Date” means
a date as of which each Investment Fund under the RSP is valued and
the Participant’s Accounts adjusted as provided in
Article 10 thereof. Each business date (any day on which the
New York Stock Exchange is open for trading and on which the
principal office of the Administrative Services Provider, as such
term is defined in the RSP, is open) during the Plan Year shall be
deemed a Valuation Date.
3.01
Generally . This Excess Plan shall be administered by a
committee of one or more persons established and appointed by the
Corporation to administer the RSP (the “Committee”).
The Committee shall have the sole responsibility for the
administration of the Excess Plan. A Committee member may resign by
written notice to, or may be removed by, the Corporation, which
shall appoint a successor to fill any vacancy on the Committee,
howsoever caused. An Employee’s membership on the Committee
shall automatically terminate upon such Employee’s
termination of employment with the Corporation and all of the
Corporation’s subsidiaries, joint ventures and
affiliates.
3.02
Appointment and Duties of the Committee . The Committee may
delegate its responsibilities hereunder to one or more persons to
serve at the Committee’s discretion. The Committee or its
delegate(s) shall have such powers as may be necessary to discharge
its duties hereunder, including, but not by way of limitation, the
following:
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(i)
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To administer and enforce the Excess Plan, including the
discretionary and exclusive authority to interpret the Excess Plan,
to make all factual determinations under the Excess Plan and to
resolve questions as between the Company and Participants or
Beneficiaries, including questions which relate to eligibility and
distributions from the Excess Plan, to remedy possible ambiguities,
inconsistencies or omissions, and decisions on claims which shall,
subject to the claims procedures under the Excess Plan, be
conclusive and binding upon all persons hereunder, including,
without limitation, Participants, other employees of the Company,
Beneficiaries, and former Participants, and their executors,
administrators, conservators, or heirs;
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(ii)
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To prescribe procedures to be followed by Participants or
Beneficiaries filing applications for benefits;
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(iii)
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To prepare and distribute, in such manner as the Committee
determines to be appropriate, information explaining the Excess
Plan;
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(iv)
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To receive from the Company and from Participants such information
as shall be necessary for the proper administration of the Excess
Plan;
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(v)
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To furnish the Company, upon request, such reports with respect to
the administration of the Excess Plan as are reasonable and
appropriate;
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(vi)
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To receive, review and keep on file (as it deems convenient or
proper) reports of the receipts and disbursements under the Excess
Plan;
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(vii)
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To appoint or employ individuals to assist in the administration of
the Excess Plan and any other agents it deems advisable, including
legal counsel, third party administrators (“TPAs”), and
such clerical, medical, accounting, auditing, actuarial and other
services as it may require in carrying out the provisions of the
Excess Plan or in connection with any legal claim or proceeding
involving the Excess Plan, to settle, compromise, contest,
prosecute or abandon claims in favor of or against the Excess Plan;
and
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(viii)
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To discharge all other duties set forth herein.
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3.03
Recusal . No member of the Committee shall
participate in any action on any matters involving solely his or
her own rights or benefits as a Participant under the Excess Plan,
and any such matters shall be determined by the other members of
the Committee.
3.04
Direction on Payments . The Committee, or the person or
persons designated by the Committee, shall review and approve all
distributions from the Excess Plan, including requests for
distributions by reason of an Unforeseeable Emergency.
3.05
Actions by the Committee . The Committee may act at a
meeting or by writing without a meeting, by the vote or assent of a
majority of its members. The Committee may adopt such by-laws and
regulations as it deems desirable for the conduct of its affairs
and the administration of the Excess Plan. A dissenting Committee
member who, within a reasonable time after he or she has knowledge
of any action or failure to act by the majority, registers his or
her dissent in writing delivered to the other Committee members
shall not be responsible for any such action or failure to
act.
3.06
Expenses of the Committee . Members of the Committee shall
not receive compensation from the Excess Plan for those services
they perform as the Committee members while employed by the
Company. Any and all necessary expenses related to Excess Plan
administration shall be paid by the Corporation and each
participating Company but may be charged against Excess Plan
Accounts.
3.07
Records of the Committee . The Committee shall keep a record
of all of its meetings and shall keep all such books of account,
records and other data as may be necessary or desirable in its
judgment for the administration of the Excess Plan. The Committee
may retain a TPA to perform some or all of its Excess Plan
record-keeping functions.
3.08
Information from Participant . The Committee may require a
Participant to complete and file with the Committee written or
electronic forms approved by the Committee, and to furnish all
pertinent information requested by such Committee. The Committee
may rely upon all such information so furnished, including the
Participant’s current mailing address.
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An
Employee who meets the criteria established to be a Participant, as
set forth herein, shall be eligible for benefits hereunder;
provided, however, that in no event shall a Participant who is not
entitled to benefits under the RSP be eligible for a benefit under
this Excess Plan.
5.
Supplementary Company Retirement Account .
The
Corporation shall credit an amount to each Participant’s
Supplementary Company Retirement Account equal to the excess of
(i) the Company Retirement Contributions that would have been
made under the RSP in a Plan Year, without regard to any
limitations on such Company Retirement Contributions contained in
the RSP and/or any cap on Compensation therein, over (ii) the
actual Company Retirement Contribution made under the
RSP.
6.
Supplementary Savings Account .
The
Corporation shall credit an amount to each Participant’s
Supplementary Savings Account equal to the excess of (i) the
Company Matching Contributions that would have been made under the
RSP in a Plan Year, without regard to any limitations on such
Company Matching Contributions contained in the RSP and/or any cap
on Compensation therein, over (ii) the actual Company Matching
Contribution made under the RSP.
7.
No Participant Contributions .
Contributions
to the Excess Plan by Participants, whether on a salary reduction
basis or otherwise, are not required and are not
permitted.
The
amounts credited to a Participant’s Supplementary Company
Retirement Account and his Supplementary Savings Account shall vest
in the same manner as under the RSP.
9.
Distribution of Benefits .
9.01
Generally . A Participant’s vested Account shall be
distributed to him or her as follows:
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(i)
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Pre-2005 Account Balances
. A Participant’s vested Pre-2005 Account Balance shall be
distributed to him or her in cash in a single sum within thirty
(30) days following the date of the Participant’s
Separation from Service.
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(ii)
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Post-2004 Balances
. A Participant’s vested Post-2004 Account Balance shall be
distributed to the Participant in cash in a single sum in the
seventh month following the month in which the Participant’s
Separation from Service occurs.
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9.02
No In-Service Withdrawals or Loans . No in-service
withdrawals or Participant loans are available under the Excess
Plan.
9.03
Unforeseeable Emergency . A Participant or Beneficiary
entitled to vested benefits under the Excess Plan may request a
single-sum distribution in cash to satisfy an Unforeseeable
Emergency. The distribution shall be limited to the amount
necessary to satisfy the Unforeseeable Emergency (including any
applicable federal, state or local taxes attributable to
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