AMENDED AND RESTATED JANUARY 1, 1997
TABLE OF CONTENTS
ARTICLE I DEFINITIONS 2
1.01 Accrued Benefit 2
1.02 Acquired Group 2
1.03 Actuarial Equivalent 2
1.04 Annuity Starting Date 2
1.05 Beneficiary or Beneficiaries 2
1.06 Board of Directors 2
1.07 Break in Employment 2
1.08 Code 3
1.09 Committee or Employee Benefits Committee 3
1.10 Company 3
1.11 Contingent Annuitant 3
1.12 Covered Compensation 3
1.13 Credited Service 3
1.14 Defined Benefit Plan 5
1.15 Defined Benefit Plan Fraction 5
1.16 Defined Contribution Plan 5
1.17 Defined Contribution Plan Fraction 5
1.18 Effective Date 5
1.19 Eligible Employee 5
1.20 Employee 6
1.21 Employer 6
1.22 Employment Date 6
1.23 ERISA 6
1.24 Fiduciary 6
1.25 Former Participant 6
1.26 Fund 6
1.27 Highly Compensated Employee 6
1.28 Hour of Service 7
1.29 Investment Manager 7
1.30 Leased Employee 7
1.31 Monthly Plan Compensation 7
1.32 One Year Break in Service 9
1.33 Participant 9
1.34 Participating Company 9
1.35 Plan 9
1.36 Plan Year 9
1.37 Predecessor Company 9
1.38 Prior Plan 9
1.39 Primary Social Security Benefit 9
1.40 Qualified Election 10
1.41 Qualified Joint and Survivor Annuity 10
1.42 Reemployment Date 10
1.43 Related Company 10
1.44 Retirement Benefit 10
1.45 Spouse 10
1.46 Spousal Consent 10
1.47 Surviving Spouse 11
1.48 Total and Permanent Disability 11
1.49 Trust Agreement 11
1.50 Trustee 11
1.51 Year of Service 11
ARTICLE II PLAN ELIGIBILITY 13
2.01 Requirements for Participation 13
2.02 Termination of Participation 14
2.03 Transfers 14
2.04 Change in Employment Status 16
ARTICLE III ELIGIBILITY FOR BENEFITS 18
3.01 Normal Retirement Date 18
3.02 Early Retirement Date 18
3.03 Late Retirement Date 18
3.04 Disability Retirement Date 18
3.05 Vested Retirement Date 19
ARTICLE IV RETIREMENT BENEFITS 20
4.01 Normal Retirement Benefit 20
4.02 Benefit Offsets 24
4.03 Early Retirement Benefit 26
4.04 Late Retirement Benefit 26
4.05 Disability Retirement Benefit 26
4.06 Vested Retirement Benefit 28
4.07 Preretirement Surviving
Spouse Benefit 28
4.08 Inability to Locate Participant 28
4.09 Maximum Benefit Limitation 29
4.10 Claim for Benefits 31
ARTICLE V COMMENCEMENT AND DURATION
OF BENEFITS 32
5.01 Commencement of Retirement
Income Payments 32
5.02 Qualified Joint and Survivor Annuity 33
5.03 Optional Retirement Benefit 34
5.04 Reemployment Prior to Retirement 35
5.05 Preretirement Surviving
Spouse Benefit 35
5.06 Suspension of Benefits 36
5.07 Small Benefits 36
5.08 Direct Rollovers 37
ARTICLE VI COMMITTEE 38
6.01 Members 38
6.02 Committee Action 38
6.03 Right and Duties 38
6.04 Investment Responsibility 39
6.05 Transmittal of Information 40
6.06 Duty of Care 40
6.07 Compensation, Bonding,
Indemnity and Liability 40
6.08 Manner of Administering 40
6.09 Annual Report 40
ARTICLE VII CONTRIBUTIONS 42
7.01 Source of Contributions 42
7.02 Company Contribution 42
7.03 Application of Forfeitures 42
7.04 Assets Available to Pay Benefits 42
ARTICLE VIII TRUST 43
ARTICLE IX AMENDMENT AND TERMINATION 44
9.01 Amendments 44
9.02 Discontinuance of Plan 44
9.03 Termination of Plan 44
ARTICLE X RESTRICTION OF BENEFITS 47
10.01 Restrictions on Benefits of
Highly Compensated Employees 47
ARTICLE XI TOP-HEAVY PROVISIONS 48
11.01 General 48
11.02 Definitions 48
11.03 Top-Heavy Definition 49
11.04 Vesting 49
11.05 Minimum Benefits or Contributions and
Section 415 Limitations 49
ARTICLE XII MISCELLANEOUS 52
12.01 Irrevocable Dedication 52
12.02 Nonassignability 52
12.03 Limitations on Participant's Rights 52
12.04 Participants Bound 52
12.05 Receipt and Release 53
12.06 Merger or Consolidation of Plans 53
12.07 Governing Law; Separability 53
12.08 Headings and Subheadings 53
12.09 Instrument in Counterparts 53
12.10 Gender 53
12.11 Successors and Assigns 53
12.12 Recovery of Overpayment 53
ARTICLE XIII PARTICIPATION BY COMPANY OR RELATED COMPANY 54
13.01 Participation by any Company or Related Company 54
13.02 Withdrawal by any Company or Related Company 54
ARTICLE XIV EXECUTION 55
EXHIBIT A ACTUARIAL EQUIVALENT A-1
EXHIBIT B PARTICIPATING COMPANIES B-1
EXHIBIT C PROGRESS PATTERN C-1
EXHIBIT D FPO D-1
EXHIBIT E PLASTICS (HAAS) E-1
EXHIBIT F BENEFITS FOR FORMER EMPLOYEES OF FORD MOTOR COMPANY F-1
EXHIBIT G BENEFITS FOR FORMER EMPLOYEES OF DELPHI AUTOMOTIVE
EXHIBIT H AVERAGE MONTHLY BENEFIT PAYABLE FROM THE
RETIREMENT PLAN FOR SALARIED EMPLOYEES OF ITT
EXHIBIT I DIVESTITURES I-1
Prior to September 30, 1988, Lear Siegler Diversified Holdings Corp. (the "Predecessor Company") maintained the Lear Siegler Diversified Holdings Corp. Pension Plan (the "Predecessor Plan") for the benefit of certain employees of Lear Siegler Diversified Holdings Corp. and its subsidiaries and certain related companies.
Effective September 30, 1988, an Investment Group acquired the assets of Lear Siegler Seating Corp. (the "Company") from the Predecessor Company. In accordance with the Agreement of Purchase and Sale between the Company and the Predecessor Company, the Company established the Lear Siegler Seating Corp. Pension Plan (the "Prior Plan") covering eligible employees who were covered by the Predecessor Plan as of September 29, 1988, in addition to eligible employees hired by the Company after such date. The new pension plan provided benefits substantially the same as the benefits provided under the Predecessor Plan and granted any eligibility, vesting and benefit accrual service which was recognized under the Predecessor Plan. Benefits provided by the Predecessor Plan, as computed under the regular formula under Article IV of the Predecessor Plan, and any grandfathered formula or forms of benefit under the Predecessor Plan, will be offset against the career benefit computed under the new pension plan.
In conjunction with a change in the Company's name and an amendment and restatement of said plan, the Company hereby establishes the Lear Seating Corporation Pension Plan as of October 1, 1989, through December 30, 1995, and effective as of December 31, 1995 the name of the Plan shall be the Lear Corporation Pension Plan (the "Plan").
Effective January 1, 1997, unless otherwise stated herein, the Plan is further amended and restated to include provisions required under the Small Business Job Protection Act of 1996, the Uniformed Services Employment and Reemployment Rights Act of 1994, the Retirement Protection Act of 1994, the Taxpayer Relief Act of 1997 and certain other changes. The rights and benefits of all Employees whose last day of service is after December 31, 1996 shall be determined under this restatement. The rights and benefits of Employees whose last day of service was before January 1, 1997 shall be determined under the Plan as in effect on the last date of their service, except as otherwise required by law or applicable regulations.
FUTURE OF THE PLAN
It is the intention of the Company to continue the Plan indefinitely and to have the Plan and related trust meet the requirements of Section 401(a) and 501(a) of the Internal Revenue Code of 1986. However, the Company reserves the right to amend or discontinue the Plan, subject to the applicable provisions thereof.
Whenever the following terms are used in this Plan, with the first letter capitalized, they shall have the meaning specified below.
1.01 ACCRUED BENEFIT shall mean, with respect to each Participant, the Retirement Benefit determined under the Plan expressed in the form of a monthly benefit commencing at Normal Retirement Date (or the date of determination, if later) which such Participant has accrued at any time under the provisions of the Plan, regardless of his vested status, determined as if he then terminated his employment.
1.02 ACQUIRED GROUP shall mean all of the companies listed in Exhibit B other than Lear Corporation.
1.03 ACTUARIAL EQUIVALENT shall mean a benefit of equivalent actuarial value when computed on the basis of the actuarial factors, assumptions and procedures recommended by the Plan's actuary, which assumptions are adopted for such purpose by the Employee Benefits Committee, and set forth in Exhibit A.
1.04 ANNUITY STARTING DATE shall mean the first day of the first period for which an amount is payable as an annuity, whether or not any such payment is actually made. In the case of a benefit which is not payable as an annuity, Annuity Starting Date shall be the date on which all events have occurred which entitle the Participant to such benefit.
1.05 BENEFICIARY or BENEFICIARIES shall mean the person or persons (including the Participant's Surviving Spouse) named by a Participant by written designation filed with the Employee Benefits Committee to receive payments after the Participant's death; provided, however, that the Participant's spouse shall be the Beneficiary where required by the Plan or applicable law. For purposes of any death benefit payable before the Participant's Benefit Commencement Date, in the event that no Beneficiary had been designated or that no designated Beneficiary survives the Participant, the following Beneficiaries (if then living) shall be deemed to have been designated in the following priority: (a) spouse, (b) children, including adopted children, in equal shares, (c) parents, in equal shares, and (d) the Participant's estate.
1.06 BOARD OF DIRECTORS shall mean the Board of Directors of Lear Corporation.
1.07 BREAK IN EMPLOYMENT shall mean the Employee's resignation, discharge, death or retirement from or by the Company or a Related Company effective as of the applicable event. Transfer between the Company and a Related Company or between Related Companies shall not constitute a Break in Employment provided there is no intervening employment elsewhere. In determining whether an Employee has incurred a Break in Employment, the following shall apply:
(a) A Break in Employment shall not occur during leaves of absence authorized by the Company or a Related Company before or after the absence, in accordance with established policies, and vacation periods, temporary layoffs for lack of work, and military leaves.
(b) A Break in Employment shall occur on the later of (i) the date an Employee receives, or is eligible to receive, workers' compensation, provided such Employee is not eligible for a Disability Retirement Benefit under the Plan and (ii) the first anniversary of the date the employee was first absent from work due to the sickness or injury for which he receives such workers' compensation.
(c) Continuation upon temporary layoff for lack of work for a period in excess of 15 months shall be considered a discharge effective as the expiration of such period.
(d) Failure to return to work after the expiration of any leave of absence or after recall from any temporary layoff shall be considered a resignation, effective as of the expiration of such leave of absence or layoff.
(e) Failure of an Employee on military leave to make application for reemployment within the period during
which he is entitled thereto under the laws of the United States shall be considered a resignation effective as of the earlier of the end of such military leave or the anniversary date of the commencement of such military leave.
(f) Notwithstanding anything contained herein to the contrary, a Break in Employment shall not occur during the first 12 months of absence from employment by reason of sickness, maternity or paternity reasons (as defined in Section 1.32), or military service.
1.08 CODE shall mean the Internal Revenue Code of 1986, as amended.
1.09 COMMITTEE or EMPLOYEE BENEFITS COMMITTEE shall mean the Employee Benefits Committee appointed in accordance with Article VI.
1.10 COMPANY shall mean Lear Corporation or any successor corporation resulting from a merger, consolidation, or transfer of assets substantially as a whole, which shall expressly agree in writing to continue this Plan as herein provided.
1.11 CONTINGENT ANNUITANT shall mean a person properly designated by a Participant to receive benefits pursuant to a Contingent Annuity (as defined in Section 5.03) in the event of the death of the Participant.
1.12 COVERED COMPENSATION shall mean the average (without indexing) of the taxable wage bases for each calendar year during the 35-year period ending with the last day of the calendar year in which the Participant reaches social security retirement age, divided by 12. In determining a Participant's Covered Compensation for a Plan Year, the taxable wage base for the current Plan Year is assumed to be the same as the taxable wage base in effect as of the beginning of the Plan Year for which the determination is being made. A Participant's Covered Compensation for a Plan Year after this 35-year period is the Participant's Covered Compensation in the Plan Year the Participant reached social security retirement age. A Participant's Covered Compensation for a Plan Year before the 35-year period is the taxable wage base in effect as of the beginning of the Plan Year. Each Plan Year, a Participant's Covered Compensation is automatically adjusted.
1.13 CREDITED SERVICE shall mean:
(a) For service prior to September 30, 1988, the Participant's Credited Service as of said date determined pursuant to the provisions of the Prior Plan as in effect on September 29, 1988.
(b) For service on or subsequent to September 30, 1988, the Participant's service (measured in years, including fractional years measured in months) with the Company or a Related Company. A Participant shall accrue one month of Credited Service for each calendar month, including partial months, between his Employment Date and the date he incurs a Break in Employment and between any Reemployment Date and the date he incurs any subsequent Break in Employment; provided, however, a Participant who incurs a One Year Break in Service shall not accrue Credited Service following his Reemployment Date unless he completes a Year of Service following such Reemployment Date.
Notwithstanding the foregoing:
(1) A Participant shall not accrue Credited Service for any period of service with a Related Company which is not a Participating Company following transfer from a Participating Company unless and until he is retransferred, without an intervening Break in Employment, to a Participating Company.
(2) In the case of an individual who becomes an Eligible Employee and a Participant in this Plan by transfer without a Break in Employment to a Participating Company from a Related Company, such individual shall accrue Credited Service for his period of employment with such prior employer to the extent that the employee was contiguously covered by another defined benefit plan sponsored by such Related Company and only to the extent such employment was recognized as Credited Service under such other plan.
(3) The provisions of Paragraph (2) above shall not be construed to deny the Board of Directors the right to exclude all or any portion of a Participant's service for purposes of determining Credited Service in the case where
coverage is extended to the Participant as a result of the Participant's employer becoming a Participating Company.
(4) In the case of an individual who was an employee of the Automotive Industries Division and transferred into this Plan on January 1, 1997, service prior to January 1, 1997 shall not be recognized as Credited Service by this Plan. Effective January 1, 1999, in the case of an individual who was a member of the Automotive Industries, Inc. Salaried Defined Benefit Pension Plan and transferred into this Plan on January 1, 1997 or who was an employee of the Automotive Industries Division and would have become a participant of the Automotive Industries, Inc. Salaried Defined Benefit Pension Plan on January 1, 1997, service prior to January 1, 1997 shall not be recognized as Credited Service by this Plan. However, in the case of an individual who was not a member of the Automotive Industries, Inc. Salaried Defined Benefit Plan as of December 31, 1996 and would not have become a member of the Automotive Industries, Inc. Salaried Defined Benefit Plan as of January 1, 1997, employment to a maximum of one year with Automotive Industries, Inc. prior to January 1, 1997 shall be recognized as Credited Service by this Plan.
(5) In the case of an individual who was an employee of the Masland Division and transferred into this Plan on April 1, 1997 service prior to April 1, 1997 shall not be recognized as Credited Service by this Plan.
(6) In the case of an individual who was an employee of Fairhaven Industries and transferred into this plan on January 1, 1997, service prior to January 1, 1997 shall not be recognized as Credited Service by this Plan.
In the case of an individual who was an employee of ITT Industries in the Automotive operation ("ITT Automotive") and transferred to this Plan on August 25, 1997, service prior to August 25, 1997 shall only be recognized in accordance with Section 4.01(f)(iii)(B) and (D).
Provisions of Credited Service specific to FAVESA and Delphi Automotive Systems are found in Exhibits F and G, respectively.
In the case of an employee whose benefits under this Plan were frozen as of December 31, 1998 upon his or her transfer to Lear Donnelly Overhead Systems, Inc. ("LDOS") and who subsequently became again covered by this Plan as of the acquisition by Lear Corporation of LDOS on September 15, 1999, Credited Service shall exclude calendar year 1999, and the maximum Credited Service used in Section 4.01 which is otherwise limited to 30 years shall, for such employees be limited to 29 years. For all other employees of LDOS who became covered under this Plan as of the acquisition by Lear Corporation of LDOS on September 15, 1999, service prior to January 1, 2000 shall not be recognized as Credited Service by this Plan.
(10) In the case of an individual who was an employee of Versatrim and who was included in this plan on January 1, 2002, service prior to January 1, 2002 shall not be recognized as Credited Service by this Plan.
(11) In the case of an individual who was an employee of General Seating and who was included in this plan on January 1, 2000, service prior to January 1, 2000 shall not be recognized as Credited Service by this Plan.
In addition to the foregoing, if a Participant incurs a Break in Employment with a Participating Company due to his Total and Permanent Disability, for purposes of computing his benefits under Section 4.05(b) (and only for that purpose) the years and months from the time such Participant incurs a Break in Employment to the earlier of the time he reaches his Normal Retirement Date or returns to work for the Company or a Related Company shall be Credited Service, provided the Participant was Totally and Permanently Disabled throughout said period and, where he is reemployed by the Company or a Related Company, he either (i) remains employed thereby for the next 12 consecutive months without a Break in Employment or (ii) he again becomes disabled, retires or dies within such 12 months.
An Employee shall not accrue any Credited Service at any time when such Employee is currently accruing benefits as an active participant in another "defined benefit plan," as such term is defined in Section 3(35) of ERISA, which is maintained by the Company or a Related Company. For purposes of this paragraph only, all foreign companies shall be deemed Related Companies if they otherwise meet the definition of Related Company.
Notwithstanding any provision of the Plan to the contrary, contributions, benefits, and service credit with respect to qualified military service will be provided in accordance with Section 414(u) of the Code.
1.14 DEFINED BENEFIT PLAN shall mean a plan described in Section 414(j) of the Code.
1.15 DEFINED BENEFIT PLAN FRACTION shall mean, for Plan Years prior to January 1, 2000, a fraction, the numerator of which is the projected annual benefit (determined as of the close of the relevant Plan Year) of the Participant under all Defined Benefit Plans maintained by one or more Related Companies, and the denominator of which is the lesser of (i) the product of 1.25 multiplied by the dollar limitation in effect under Section 415(b)(1)(A) of the Code for the Plan Year, or (ii) the product of 1.40 multiplied by the amount which may be taken into account under Section 415(b)(1)(B) of the Code with respect to the Participant for the Plan Year.
1.16 DEFINED CONTRIBUTION PLAN shall mean a plan described in Section 414(i) of the Code.
1.17 DEFINED CONTRIBUTION PLAN FRACTION shall mean, for Plan Years prior to January 1, 2000, a fraction, the numerator of which is the sum of the annual additions to a Participant's accounts under all Defined Contribution Plans maintained by one or more Related Companies (for this purpose "annual additions" shall include amounts derived from contributions paid or accrued after December 31, 1985, in taxable years ending after such date, which are attributable to post-retirement medical benefits allocated to the separate account of a key employee (as defined in Section 11.02 of this Plan) under a welfare benefit plan (as defined