SUMMARY PLAN DESCRIPTION

Transcription

1 SUMMARY PLAN DESCRIPTION ThyssenKrupp Elevator Retirement Savings Plan January 2004

2 TABLE OF CONTENTS Page INTRODUCTION...1 PARTICIPATION...1 ELIGIBILITY TO PARTICIPATE...1 SPECIAL ELIGIBILITY RULES...1 ENROLLING IN THE PLAN...2 END OF PARTICIPATION...2 CONTRIBUTIONS TO THE PLAN...2 PRE-TAX CONTRIBUTIONS...2 HOW MUCH YOU MAY CONTRIBUTE...2 CATCH-UP CONTRIBUTIONS...3 MATCHING CONTRIBUTIONS...3 TRUE-UP MATCHING CONTRIBUTION...3 EXAMPLE...3 PROFIT SHARING CONTRIBUTIONS...4 OTHER LIMITS ON CONTRIBUTIONS...4 CHANGING THE RATE OF YOUR CONTRIBUTIONS.5 SUSPENSION OF CONTRIBUTIONS...5 ROLLOVER CONTRIBUTIONS...5 YOUR ACCOUNTS...5 INDIVIDUAL ACCOUNTS...5 VESTING IN ACCOUNTS...6 HOW VESTING SERVICE IS COUNTED...6 HOW YOU COULD FORFEIT THE UNVESTED PORTION OF YOUR ACCOUNT...6 YOUR ACCOUNT VALUES...7 INVESTMENT OF YOUR ACCOUNTS...7 INVESTMENT FUNDS...7 INVESTMENT ELECTION...7 CHANGING YOUR INVESTMENTS...8 TRANSACTION FEES OR EXPENSES...8 PARTICIPANT INVESTMENT DIRECTIONS...8 PAYMENT OF ACCOUNTS...9 WITHDRAWALS...11 WITHDRAWALS WHILE EMPLOYED..11 WITHDRAWALS AT ANY AGE...11 WITHDRAWALS AFTER AGE 59½...11 HARDSHIP WITHDRAWALS (BEFORE AGE 59½).11 BORROWING FROM THE PLAN...12 YOUR RIGHT TO BORROW...12 AMOUNT THAT MAY BE BORROWED...12 REDUCTION OF YOUR ACCOUNT...12 INTEREST RATE...13 TERM OF THE LOAN...13 REPAYING THE LOAN...13 CLAIMS AND APPEALS...13 CLAIMS...13 DENIED CLAIMS...13 APPEALS...14 IMPORTANT FACTS...14 PLAN SPONSOR...14 PLAN ADMINISTRATOR...14 PLAN TYPE/IDENTIFICATION...14 PLAN TRUSTEE...14 PLAN YEAR...14 SERVICE OF LEGAL PROCESS...14 PENSION BENEFIT GUARANTY CORPORATION...15 FUTURE OF THE PLAN...15 YOUR RIGHTS UNDER FEDERAL LAW15 TERMINATION OF EMPLOYMENT FOR REASON OTHER THAN DEATH...9 DEATH...10 PAYMENT OF YOUR ACCOUNTS TO OTHER PERSONS...10 TAXATION...10 WITHHOLDING TAX...11 TAX REPORTING OF DISTRIBUTIONS AND

3 INTRODUCTION ThyssenKrupp Elevator Corporation has established the ThyssenKrupp Elevator Retirement Savings Plan (the Plan ) to provide eligible employees with an opportunity to save and invest for retirement. Under the Plan, you may contribute a portion of your compensation on a pre-tax basis, and the Company will make a matching contribution on your behalf based on the amount of your contribution. Any contributions that you make to the Plan are completely voluntary. You decide whether or not to contribute to the Plan and how much to contribute. This booklet is a summary of the Plan, effective January 1, It is not the Plan document. In case of any conflict between the information in this summary plan description and the terms of the Plan document, the terms of the Plan document will control. The Plan document contains a complete description of the terms and conditions of the Plan and legally governs the operation of the Plan. If you have any questions about the Plan or your eligibility, you may call the Fidelity Retirement Benefits Line at , or log on to the Fidelity NetBenefits website at If you have further questions, or if you wish to examine a copy of the Plan document and the trust agreement for the Plan, please contact the Plan Administrator identified on page 15. If you would like a copy of the Plan document, you should submit your written request to the Plan Administrator. PARTICIPATION Eligibility to Participate You are eligible to participate in the Plan if you are employed in a position covered by the Plan. Subject to the Special Eligibility Rules (described below), the Plan covers all employees of the Company* who are at least 18 years of age, except employees covered by a collective bargaining agreement (unless the agreement specifically provides for participation in the Plan); and non-resident aliens with no income from sources within the U.S.; and persons who are leased employees or who are classified by the Company as independent contractors. * The term Company, as used in this booklet, means ThyssenKrupp Elevator Corporation and any of its subsidiaries that are participating in the Plan. As of July 1, 2001, the participating subsidiaries are: ThyssenKrupp Elevator Manufacturing, Inc. Thyssen Access New York Elevator & Electrical Corp. (formerly Central Elevator, Inc. and New York Elevator Company, Inc.) Computerized Elevator Control Corp. Mainco Elevator & Electrical Corp. Mainco Elevator (NJ) Corp. Custom Cabs, Inc. If you become eligible to participate in the Plan and you are transferred out of the covered group, or your employment ends, your eligibility will resume immediately if you later rejoin or are reemployed in a position covered by the Plan. Special Eligibility Rules A. Employees of Thyssen Access Corp. If you are employed by Thyssen Access Corp., you will be eligible to participate in the Plan if you are employed in a position covered by the Plan (as defined above) on the January 1 st, April 1 st, July 1 st or October 1 st following the date on which you attain age 21 and complete at least 3 months of service (a month of service is any month in which you complete an hour of service with the Company, Thyssen Access Corp. or any other affiliate). 1

4 B. Middleton Hourly Employees If you are employed as an hourly-paid production or maintenance employee at the Company s Middleton, Tennessee plant, and you are represented by the International Brotherhood of Boilermakers, Iron Ship Builders, Blacksmiths, Forgers and Helpers, Local S-251, you may be eligible to participate in the Plan. Please refer to the separate summary plan description which describes the provisions of the Plan that are specifically applicable to Middleton hourly employees. Enrolling in the Plan You may enroll in the Plan as soon as you receive your enrollment materials. Fidelity will mail to you an enrollment kit, which contains Plan and investment fund information. To enroll, you must call the Fidelity Retirement Benefits Line, toll-free, at or visit the Fidelity NetBenefits website at You must also make sure you have received a Beneficiary Designation Form from the Plan Administrator. When you enroll, you must designate: the percentage of your total compensation you wish to contribute as Pre-Tax Contributions to the Plan; how your contributions are to be invested (see INVESTMENT OF YOUR ACCOUNTS beginning on page 8); and a beneficiary to receive any benefits payable from the Plan in the event of your death (see Death on page 11). Once you make your initial election with Fidelity, your contributions will begin in the next following payroll period (or as soon as administratively practicable). End of Participation Your participation in the Plan will generally end on the date you are no longer employed in a position covered by the Plan. CONTRIBUTIONS TO THE PLAN You may make Pre-Tax Contributions to the Plan. In addition, the Company will make Matching Contributions to the Plan on your behalf based on the amount of your Pre-Tax Contributions, as described below. All contributions made by you and by the Company are allocated to separate Accounts maintained on your behalf (see Individual Accounts on page 6) and are invested as you direct (see INVESTMENT OF YOUR ACCOUNTS on page 8). Prior to January 1, 2004, participants were also permitted to contribute to the Plan on an after-tax basis. If you made any After-Tax Contributions to the Plan prior to January 1, 2004, those amounts have been allocated to a separate Account on your behalf and may be invested as you direct. Pre-Tax Contributions Your Pre-Tax Contributions represent deferred income which will not be subject to Federal income taxes until distributed from the Plan. In effect, your Pre-Tax Contributions reduce your current pay for Federal income tax purposes. And, because Pre-Tax Contributions are deducted from your pay before Federal income taxes are withheld, your Federal income tax withholding will generally be less. How Much You May Contribute Your election to contribute to the Plan is made when you enroll (see Enrolling in the Plan above). You may choose to contribute a minimum of 1% up to a maximum of 18% of 2

5 your compensation. By law, your Pre-Tax Contributions in any calendar year cannot exceed the following amounts: Year Annual Limit 2004 $13, $14, $15, and later $15,000 (adjusted by the IRS for cost of living increases) Compensation for this purpose means your regular salary or wages, including any bonuses, commissions, premium pay (holiday, overtime, etc.), and any amounts that you contribute to this Plan or to a flexible benefit or cafeteria plan as before-tax contributions, but excluding deferred compensation, severance pay, and any amounts paid as fringe benefits, reimbursements and expense allowances. However, by law, the Plan may not take into account more than $205,000 (for 2004) of annual compensation for any participant. The annual compensation limit may be adjusted by the IRS in future years for cost of living increases. Catch-Up Contributions Beginning in the year that you turn age 50, if your Pre-Tax Contributions reach the 18% of compensation limit imposed by the Plan or any limit imposed by the Internal Revenue Code (see How Much You May Contribute, above), you may contribute an additional amount as a pre-tax Catch-Up Contribution. Catch-Up Contributions cannot exceed the following amounts: Year Catch-Up Contribution Limit 2004 $3, $4, $5,000 After 2006, the IRS will increase the Catch-Up Contribution limit from time to time to reflect increases in the cost of living. Matching Contributions If you make Pre-Tax Contributions during any payroll period, the Company will make a Matching Contribution on your behalf. Effective January 1, 2004, the amount of the Matching Contribution for a payroll period will equal 100% of your Pre-Tax Contributions for that payroll period up to a maximum of 5% of your compensation for the payroll period. The Company will not match Pre-Tax Contributions that you contribute to the Plan in excess of 5% of your compensation. Company Matching Contributions do not apply to Catch-Up Contributions. True-Up Matching Contribution In addition to the regular Matching Contributions (described above), which are calculated and contributed for each payroll period, you may be entitled to have the Company make a true-up Matching Contribution to the Plan on your behalf. Effective January 1, 2004, the true-up Matching Contribution is equal to 100% of your Pre-Tax Contributions for the plan year up to a maximum of 5% of your compensation for the plan year, less any payroll period Matching Contributions that have been added to your account for the plan year. The true-up Matching Contribution, which is typically paid as of the beginning of each calendar quarter, is designed to make up for any Matching Contributions that you may have lost due to limits or restrictions on your Pre-Tax Contributions. Example Bill Jones is an employee of the Company who participates in the Plan. For 2004, Bill s compensation is $39,000 ($750 per weekly period). Prior to January 1, 2004, Bill elects to contribute 4% of his compensation to the Plan as 3

6 Pre-Tax Contributions. The contributions made to Bill s accounts under the Plan for the first quarter of 2004 (the first 13 payroll periods) are as follows: Pre-Tax Contributions: Matching Contributions: $750 x 4% = $30.00 $30.00 x 13 payroll periods = $ % of Pre-Tax Contributions (up to 5% of compensation) 100% x $30.00 = $30.00 $30.00 x 13 payroll periods = $ At the end of the first quarter of 2004, a total of $ ($ $390.00) has been contributed to Bill s account under the Plan. Prior to April 1, 2004, Bill decides to increase his Pre-Tax Contributions from 4% of his compensation to 8% of his compensation. The contributions made to Bill s account under the Plan for the second quarter of 2004 (the 14 th to 26 th payroll periods) are as follows: Pre-Tax Contributions: Matching Contributions: $750 x 8% = $60.00 $60.00 x 13 payroll periods = $ % of Pre-Tax Contributions (up to 5% of compensation) 100% x ($750 x 5%) = $37.50 $37.50 x 13 payroll periods = $ Note that the Matching Contributions made to Bill s account during the second quarter of 2004 are only applied to the first 5% of his compensation for each payroll period ($750 x 5% = $37.50), even though he contributes 8% of his compensation each payroll period ($750 x 8% = $60.00) as Pre-Tax Contributions. Because Bill s Matching Contributions have been limited, he may be entitled to a true-up Matching Contribution. True-Up Matching Contribution: 100% of year-to-date Pre-Tax Contributions (up to 5% of year-to-date compensation). Year-to-date compensation = $750 x 26 payroll periods = $19,500 (a) 5% of $19,500 = $ (b) Year-to-date Pre-Tax Contributions = $ $ = $1, True-up is 100% of lesser of (a) or (b) minus the Matching Contributions that have already been made. (100% x $975.00) - $ = $97.50 At the end of second quarter of 2004, the following contributions have been made to Bill s account. Pre-Tax Contributions: $1, Matching Contributions: $ True-Up Matching Contributions: $ TOTAL $2, Profit Sharing Contributions If the Company elects to make a Profit-Sharing Contribution for a plan year, you will be credited with a portion of the Profit Sharing Contribution if you are employed by the Company on the last day of that plan year, you have completed at least 501 hours of service during the plan year and you are at least age 18. The amount allocated to your account under the Plan will be determined by multiplying the applicable profit-sharing contribution rate (determined by the Company s board of directors) by your compensation for that plan year. You do not have to contribute to the Plan to be eligible to receive a portion of the Company s Profit Sharing Contribution for a plan year. Other Limits on Contributions Federal law imposes certain additional limits on the total amount that may be credited to your accounts under the Plan each year. If you are affected by these limits, you will be notified. 4

7 Changing the Rate of Your Contributions By calling the Fidelity Retirement Benefits Line at or visiting the Fidelity website at you may elect at any time to change the percentage of your compensation that you are contributing as Pre-Tax Contributions. Your requested change will take effect at the beginning of the next calendar quarter (January 1, April 1, July 1, October 1). Suspension of Contributions You may stop your Pre-Tax Contributions at any time by calling the Fidelity Retirement Benefits Line at or visiting the Fidelity NetBenefits website at Your request to stop your Pre-Tax Contributions will take effect at the beginning of the next payroll period (or as soon as administratively practicable). learn about these rules and comply with them exactly. In order to make a rollover to the Plan, you must first contact the Plan Administrator (see page 15 for the address and telephone number). Individual Accounts YOUR ACCOUNTS Your contributions and the Company s contributions to the Plan are held in individual accounts maintained on your behalf by the Trustee. Depending on your personal history of participation in the Plan, you may have a number of different accounts, including: Employee Pre-Tax Account Containing your own Pre-Tax Contributions to the Plan. Rollover Contributions If you have an account in another employer s qualified retirement plan, or section 403(b) tax-sheltered annuity arrangement, a governmental employer s section 457(b) eligible deferred compensation plan, or if you have transferred a distribution from such a plan to an individual retirement account (IRA), you may, with the Plan Administrator s permission, transfer (or roll over ) your balance to this Plan. In general, you will be eligible to roll over an amount into the Plan if you are at least age 18 and you are employed in a position covered by the Plan. You do not have to be a Plan participant to execute a rollover. Rollover contributions will increase your account balance in the Plan. You will always be entitled to receive the amount you roll over (as adjusted for investment results or withdrawals) if you leave the Company for any reason. Employee Catch-Up Contribution Account Employee After-Tax Account Employer Matching Account Profit Sharing Account Rollover Account Containing your pre-tax Catch-Up Contributions to the Plan. Containing your After-Tax Contributions to the Plan (After-Tax Contributions were permitted prior to January 1, 2004). Containing Matching Contributions made by the Company. Containing Profit Sharing Contributions made by the Company. Containing amounts that you may have received from another employer s retirement plan, and chose to transfer to this Plan. The tax laws that apply to rollovers are complex. Before making a rollover, you should In addition, if you were a participant in a plan that has been merged into this Plan, you may have additional accounts. 5

8 Each of the different types of Accounts in the Plan also contains any related investment earnings. Vesting in Accounts You always have a 100% vested (i.e., nonforfeitable) interest in your Employee Pre-Tax Account, your Employee Catch-Up Contribution Account, your Employee After-Tax Account, your Rollover Account, and, subject to the following rules, your Employer Matching Account and your Profit Sharing Account. If you terminated employment with the Company prior to January 1, 2004, you will have a vested interest in your Employer Matching Account and Profit Sharing Account according to the following schedule: Years of Vesting Service Vested Percentage 5 or more 100% at least 4 but less than 5 80% at least 3 but less than 4 60% at least 2 but less than 3 40% at least 1 but less than 2 20% Less than 1 0% (Please note, if you were first employed in a position covered by the Plan prior to January 1, 2000, you are automatically vested in your Employer Matching Account and Profit Sharing Account.) You will also have a 100% vested interest in all of your Accounts if you retire (after age 65), or terminate your employment due to permanent disability (as defined in the Plan document) or death. How Vesting Service is Counted You will receive credit for a Year of Vesting Service for each year of employment with the Company (and certain affiliates of the Company). Your Years of Vesting Service will be calculated from the date you begin employment to the date you have a severance from employment (the date you quit, retire, are discharged or die). If you leave the Company and return to work before the one-year anniversary of your leaving, you will receive credit for the time you were not employed and thus avoid having a oneyear period of severance. A one-year period of severance is any one-year period in which you are not employed by the Company. It is to your advantage to avoid a severance from employment because if you have five consecutive one-year periods of severance, you may lose credit for your accumulated Years of Vesting Service and forfeit the unvested amounts in your Account. Solely for the purpose of determining when a severance from employment occurs, if you are absent due to leave protected by the Family and Medical Leave Act of 1993 or a Companyapproved leave of absence of up to one year, or if you are absent for military service and you return to the Company within the time that your reemployment rights are protected by law, you will receive credit for your absence and avoid a severance from employment. How You Could Forfeit the Unvested Portion of your Account If you are less than 100% vested in your Profit Sharing Account when you leave the Company, the non-vested portion of that Account (and any other non-vested amount) will be forfeited as of the last day of the plan year in which you receive a distribution of the vested portion of your Account, or (if earlier) the last day of the plan year in which you incur five consecutive one-year periods of severance (as defined above). If you are not fully vested in your Account when you leave the Company, you receive a distribution of the vested portion of your Account, and you are rehired before you have 6

9 incurred five consecutive one-year periods of severance, the amount that you forfeited may be restored if you repay to the Plan the full amount of any distribution you received when you left the Company. If you choose to make such a repayment, it must be made by the earlier of (1) the fifth anniversary of your date of rehire by the Company, or (2) the last day of the plan year in which you have five consecutive one-year periods of severance. The repayment may be made in installments. Under any other circumstances, the forfeiture will be permanent. Your Account Values The value of your Accounts will be adjusted by: adding your contributions and the Company s contributions made on your behalf to your Accounts; adding or subtracting your proportionate share of the investment earnings or losses of each investment fund in which your Accounts are invested; subtracting any withdrawals and distributions made from your Accounts; and subtracting your share of any operating expenses of the Plan that are paid from the trust fund of the Plan. Each quarter, you will receive a personal statement of the value of each of your Accounts. In addition, the investment performance of the mutual funds in which your Accounts are invested (see INVESTMENT OF YOUR ACCOUNTS below) is published in the financial pages of major newspapers. You can also obtain your current Account balance at any time by calling the Fidelity Retirement Benefits Line at or by visiting the Fidelity NetBenefits website at Be sure that you have your Social Security number and your PIN Code ready when you make a call. You may also visit Fidelity s website at the following internet address for Account information and investment information: INVESTMENT OF YOUR ACCOUNTS Investment Funds The Plan features a wide range of investment funds, with different investment objectives, risk, and potential for gain. The availability of these funds allows you to create an investment program that is right for you. Before deciding to invest in any fund, you should read the prospectus for that fund. There is no guarantee that the stated investment goals of any of the funds will be realized. You can obtain detailed information (including a prospectus) about each of the investment funds offered under the Plan by calling the Fidelity Retirement Benefits Line at or by visiting the Fidelity website at The Plan Administrator has the right to add or remove investment funds from the above list. You will be notified in advance of any such change. Investment Election When you elect to participate in the Plan, you choose how your contributions are to be invested. The Company contributions made on your behalf will be invested in the same proportions as your contributions. You may direct that each contribution be invested among any or all of the investment funds offered under the Plan, in increments of 1%. Please note, however, that the Dover Corporation Stock Fund is closed to new investments and transfers. Your election of how the contributions are to be invested will remain in effect until changed by you. 7

10 Changing Your Investments You may change your investment election as of any business day. Any such change will apply, as you direct, (1) only to existing monies in your Accounts, or (2) only to future contributions to your Accounts, or (3) to both the existing monies in your Accounts and to your future contributions. In order to make an investment change, you must call Fidelity at or visit the Fidelity website at Be sure that you have your Social Security number and your PIN Code ready when you make a call or visit the website. Since the Plan is valued daily, Fidelity must receive your investment instructions by 4:00 PM Eastern Time or, if earlier, the close of the New York Stock Exchange, on a particular day in order to ensure that Fidelity will process your instructions that day. Transaction Fees or Expenses There is an annual fee of $100 if you invest all or a portion of your Accounts in the Fidelity BrokerageLink investment option. This fee will be deducted from your account in quarterly installments of $25. Also, short-term trading fees may apply to some mutual fund options, as described above. Unless otherwise indicated, there are no other transaction fees or expenses that reduce your Account balance that are associated with the purchase or sale of the investment options offered under the Plan. Participant Investment Directions The Plan is intended to comply with section 404(c) of the Employee Retirement Income Security Act of 1974 ( ERISA ) and accompanying regulations. This means that the Plan permits participants to direct the investment of their Accounts, and, as long as the Plan complies with the requirements of section 404(c), you will have responsibility for deciding how your account is invested and the parties that otherwise would be responsible for making investment decisions (the fiduciaries of the Plan) will not be liable for any losses that result directly from investment instructions made by you. To comply with section 404(c), the Plan must permit participants to choose from a broad range of investment alternatives and must provide participants with certain information about the investment alternatives and the operation of the Plan. In addition to the information included in this summary and in your enrollment package for the Plan, you may request the following information: a description of the annual operating expenses of each investment fund, and the aggregate amount of such expenses expressed as a percentage of average net assets of the investment fund; copies of any prospectuses, financial statements and reports, and of any other materials relating to the investment funds, to the extent such information is provided to the Plan; a list of the assets comprising the portfolio of each investment fund which constitute Plan assets within the meaning of ERISA, and the value of each such asset; information concerning the value of shares or units in each investment fund, as well as the past and current investment performance of such investment fund, determined, net of expenses, on a reasonable and consistent basis; and information concerning the value of shares or units in investment funds held in the account of the participant or beneficiary. The Company is the named fiduciary responsible for providing this information. To request any of this information, contact: Fidelity Investments, as agent 8

11 A Fidelity service representative ( ) can also provide or help you obtain this information. PAYMENT OF ACCOUNTS Your Accounts will be payable upon your termination of employment for any reason. Remember that you will always be entitled to receive the full value of the following Accounts: Employee Pre-Tax Account Employee Catch-Up Contribution Account Employee After-Tax Account Employer Matching Account Profit Sharing Account Rollover Account Prior Plan Accounts However, if you terminated employment with the Company prior to January 1, 2004 for any reason other than retirement (at or after age 65), disability, or death, your Employer Matching Account, your Profit Sharing Account, and your Prior Plan Accounts will be paid to you only to the extent that you are vested in those Accounts at the time you leave the Company. Your Accounts are generally payable to you in cash. However, if any portion of your vested Accounts is invested in the Dover Corporation Stock Fund, you (or your beneficiary) may elect to receive that portion of your vested Accounts in the form of shares of Dover Corporation common stock. Fractional shares will be distributed in cash. Termination of Employment for Reason Other Than Death If you terminate employment for any reason other than death, and the value of the vested portion of your Accounts (other than your Rollover Account) is $5,000 or less, your Accounts will be paid to you as soon as practicable in a single sum payment. If the value of the vested portion of your Accounts (other than your Rollover Account) is more than $5,000, you may elect to have your Accounts paid as soon as practicable following your termination of employment, or held under the Plan for payment at a later date (but not beyond April 1 of the year following the calendar year in which you attain age 70 ½). Your Accounts will be paid in a single sum payment (except as provided below). If you terminate employment and attain age 55, you may elect to receive distribution of all or a portion of the vested portion of your Accounts in installments. You may elect to have installments paid monthly, quarterly, semi-annually, or annually, over a period that does not exceed your life expectancy or the joint life expectancy of you and your beneficiary (as determined under tables published by the Internal Revenue Service). Each installment will be in a fixed dollar amount of at least $500. However, the final installment cannot exceed the amount remaining in your Accounts. Each installment will be taken pro rata from the Investment Funds in which your Accounts are invested. Upon notice to the Plan Administrator, you may change the amount or frequency of the installments, or elect to receive all or a portion of the balance of your Accounts in a single sum. Such a change may be made at any time, provided, however, that not more than one change described in this section may be made in any plan year. 9

12 Death If you die before your vested Accounts are paid to you, your Accounts will generally be paid in a single sum to your beneficiary. However, if you die after you attain age 55, your beneficiary may elect to receive your vested Accounts in the form of installments, and may make elections and changes with regard to the installments in the same manner as you would otherwise be allowed to make. In the event that installment payments had commenced prior to your death, your vested Accounts will continue to be distributed in accordance with your election to the Beneficiary. However, your Beneficiary will be entitled to receive the balance of your vested Accounts in a single sum at any time. You designate your beneficiary(ies) on the beneficiary designation form you complete when you become a participant in the Plan. Your beneficiary designation may include primary and contingent beneficiaries. You may change your beneficiary designation at any time by completing and submitting the change of beneficiary form with the Human Resources Department (or, if designated by the Human Resources Department, directly to Fidelity). However, if you are married and you wish to designate someone other than your spouse as your primary beneficiary, your spouse must provide written consent. Your spouse or designated beneficiary(ies) must survive you in order to receive the benefits payable from the Plan upon your death. If your spouse or designated (primary or contingent) beneficiary(ies) does not survive you, or if you have not designated a beneficiary, and if you have no surviving spouse, your vested Account balances will be paid in a single sum to your estate upon your death. Payment of Your Accounts to Other Persons It is intended that the vested portion of your Accounts will be paid to you or your beneficiary in accordance with the terms of the Plan. However, if you become a party to a divorce, property settlement or other court order entered in a domestic relations proceeding, or if you become liable for support or alimony payments, the Plan may be legally required to pay all or a portion of your Accounts to your spouse, ex-spouse, children or other dependents. The Plan has procedures for determining whether a domestic relations order must be honored (that is, whether all or part of your account legally must be paid to a third party). You may obtain copies of these procedures, as well as other information relevant to processing qualified domestic relations orders, without charge, from your Human Resources representative. Taxation Because the Plan is intended to qualify for tax-exempt status under the Internal Revenue Code, you gain certain tax advantages during participation and, in some cases, when your Accounts are distributed. Except for After-Tax Contributions (which are subject to Federal income tax when contributed to the Plan, and are tax-free when subsequently distributed to you), you are not required to pay Federal income tax until you actually receive the money as a distribution or withdrawal (see pages regarding your right to withdraw from your Accounts while still employed). Your entire distribution or withdrawal (other than the amount attributable to After-Tax Contributions) will be includable in your taxable income. However, you may be able to defer tax further through a rollover or transfer to an Individual Retirement Account (IRA) or another employer s plan. If you receive a distribution from the Plan because you terminate employment before age 55, the taxable portion of the distribution may also be subject to an additional 10% tax (unless your distribution is rolled over). Furthermore, any withdrawal that you make from the Plan before age 59½ while still employed by the Company (other than a withdrawal of After-Tax Contributions) may also be subject to this additional tax. Certain exceptions to the 10

13 additional tax may be available, and you should be aware that tax consequences vary depending on such factors as age, marital status, other income and combinations of more than one method of distribution. You are therefore urged to consult your personal tax advisor. Withholding Tax A distribution or withdrawal of taxable income is generally subject to tax withholding. For single sum payments, the tax withheld will equal 20% of the taxable income. However, if you direct Fidelity to transfer your payment directly to the trustee of an Individual Retirement Account (IRA) that you have established, or directly to the qualified retirement plan, section 403(b) tax-sheltered annuity or section 457(b) eligible deferred compensation plan of another employer (assuming that your other employer s plan will accept such a transfer), no taxes will be withheld currently from your payment. For periodic payments (such as the installment option described above), the tax withheld generally will equal 10% of the taxable income. Periodic payments cannot be rolled over. Furthermore, a single sum payment of a death benefit can be rolled over only if the beneficiary is the spouse of the deceased participant. Note that in certain cases the amount withheld may not cover the actual tax due. Tax Reporting of Distributions and Withdrawals You will receive Form 1099R to provide you with tax filing information for all distributions or withdrawals paid during the previous year. As required by law, a copy of this form will be forwarded to the Internal Revenue Service. WITHDRAWALS WHILE EMPLOYED The Plan permits you to make withdrawals from your Accounts while employed by the Company. All requests for a withdrawal should be initiated by calling the Fidelity Retirement Benefits Line at , and must be approved by the Plan Administrator. The Plan Administrator has the sole discretion to determine your eligibility for any type of withdrawal and the amount of your withdrawal. Different withdrawal rules apply depending upon the Account from which you are making the withdrawal and, in some instances, your age. You may not withdraw amounts that you have pledged as security for a Plan loan (see BORROWING FROM THE PLAN beginning on page 13). Any withdrawal from your Accounts while you are still employed by the Company may have special tax consequences (see Taxation beginning on page 11). Withdrawals At Any Age Regardless of your age, you may request up to two withdrawals per year from your After-Tax Account and your Rollover Account. Withdrawals After Age 59½ After age 59½, you may request up to two withdrawals per year from the vested portion of any of your Accounts. Hardship Withdrawals (Before Age 59½) Before age 59½, you may make withdrawals from your Employee Pre-Tax Account and your Employee Catch-Up Contribution Account (excluding any earnings in those Accounts since December 31, 1988), but only in cases of financial hardship: 11

14 In order to qualify for a hardship withdrawal, you must have an immediate and heavy financial need which cannot be met from other resources reasonably available to you. In general, this standard will not be met unless you have first taken a loan from the Plan (see BORROWING FROM THE PLAN, below). Your financial need is considered to be immediate and heavy if your request for a withdrawal is on account of: certain uninsured medical expenses of you or your dependents; the purchase of your principal residence (excluding mortgage payments); tuition, related educational fees, and room and board expenses for post-secondary education for the next 12 months for you or your dependents; or the need to prevent eviction from your principal residence, or foreclosure on your principal residence. Your hardship withdrawal cannot exceed the amount required to meet your financial need, including any amounts needed to pay any taxes or penalties reasonably expected to result from the withdrawal. Your hardship withdrawal will be taken pro rata from the investment funds in which your Accounts are invested. If you make a hardship withdrawal, you will not be eligible to make Pre-Tax Contributions or Catch-Up Contributions or receive Matching Contributions for a period of 6 months from the date of your withdrawal. Example: From January 1 through June 30, 2004, Fred Johnson has made a total of $5,000 in Pre-Tax Contributions to the Plan. On July 1, 2004, Fred receives a hardship withdrawal. His Pre-Tax Contributions and Catch-Up Contributions automatically stop at that time and cannot begin again until 6 months later (i.e., January 1, 2005). BORROWING FROM THE PLAN Your Right to Borrow You may borrow from your Accounts in the Plan. To request a loan, or to obtain more information about borrowing from the Plan, call Fidelity at You may not have more than three loans outstanding at any time and you may not have more than one loan approved during any 12- month period. Amount That May Be Borrowed The maximum amount that you can borrow from the Plan is the lesser of: (a) $50,000* or (b) fifty percent (50%) of the vested balance in your Accounts The minimum amount of any loan from the Plan is $1,000. * If you already had a loan during the 12 months before the date of the new loan, this $50,000 figure is reduced by the highest outstanding balance of your previous loan during that 12 month period. Reduction of your Account The Plan Administrator will reduce, in the following order of priority, the credit balances in your account to reflect the principal amount of the loan: (1) Employee After-Tax Account (2) Employee Pre-Tax Account (3) Employee Catch-Up Contributions Account (4) Employer Matching Account 12

15 (5) Profit-Sharing Account (6) Rollover Account This reduction will be applied pro rata from the investment funds in which your Accounts are invested. Your loan payments will be applied to your Accounts in the reverse order that those Accounts were reduced and will be invested in accordance with your investment elections currently in effect. Interest Rate The rate of interest on loans will be a reasonable rate determined by the Plan Administrator from time to time to be commensurate with the prevailing interest rate charged on similar commercial loans made within the same locale and time period. The rate of interest will remain fixed for the life of the loan. Term of the Loan You must select the term of your loan (up to 59 months) at the time you apply for it. Loans used to acquire your principal residence may have a term of up to 359 months. You may prepay the entire outstanding balance of your loan at any time, without penalty. Repaying the Loan Generally, your loan will be repaid in installments through automatic payroll deductions, which you must authorize at the time you apply for the loan. However, if you terminate employment, you may continue to make loan repayments by contacting Fidelity and making alternative arrangements. If you stop making required loan repayments, your outstanding loan balance, including accrued interest, will become due and payable immediately. If you do not repay this amount within the time requested by the Plan Administrator, the amount owed will be deducted from your vested Accounts before the Plan makes any distribution to you. The amount of this deduction will be treated as a taxable distribution to you for the year in which the deduction is made. Claims CLAIMS AND APPEALS After Fidelity is notified of your termination of employment, it will determine the amount of the benefit payable to you or your beneficiary. If you believe that you are entitled to a benefit (or a different amount of benefit) under the terms of the Plan, you may file a written claim with the Plan Administrator. The same procedures apply with respect to your beneficiary. Denied Claims If your claim for benefits is denied in whole or in part, you will receive, within 90 days after receipt of your application, a written explanation from the Plan Administrator explaining: the specific reasons for the denial; the provisions in the Plan document that support those reasons; the additional information, if any, you must provide to support your application and an explanation why that information is necessary; and the procedure for appeal of denied applications. If special circumstances make it impossible for the Plan Administrator to reach a decision on your application within 90 days, the Plan Administrator will notify you in writing, before the end of the initial 90-day period, of the special circumstances and the date by which it expects to reach a decision. 13

16 Appeals You have the right to appeal any denial of your application for benefits to the Plan Administrator. To do so, you must file a written appeal with the Plan Administrator within 60 days after you receive the denial of your application. If you do not appeal the denial of your application within 60 days, the denial will be final. You or your personal representative may review plan documents and submit written comments as part of your appeal. In addition, to prepare your appeal, you or your personal representative may make a written request to the Plan Administrator for all pertinent Plan information. The Plan Administrator will conduct a full review of your appeal within 60 days and notify you of its decision. If the Plan Administrator cannot complete its review within 60 days, you will be notified in writing before the end of the initial 60-day period. The Plan Administrator s decision on your appeal will be in writing and will include the specific reasons and the Plan provisions on which the decision is based. The decision of the Plan Administrator is final. The Committee has the authority to establish any rules necessary for the general administration of the Plan. Any communication with the Committee should be sent to the attention of the ThyssenKrupp Elevator Human Resources Department at the above address. Plan Type/Identification The Plan is a 401(k)/profit-sharing plan. The Plan is identified by the following numbers: the employer identification number assigned to the Company by the Internal Revenue Service the plan number assigned to the Plan by the Company. Plan Trustee All contributions to the Plan are held in a Trust Fund maintained by the Plan Trustee. The Plan Trustee is: Fidelity Management Trust Company 82 Devonshire Street Boston, MA Plan Sponsor IMPORTANT FACTS The Plan is sponsored by: ThyssenKrupp Elevator Corporation 1995 N. Park Place Suite 370 Atlanta, GA Plan Administrator The Plan is administered by the Pension Committee, which may be contacted at the above address, and at telephone number Plan Year The Plan s records are kept on a calendar year basis, January 1 through December 31. Service of Legal Process is: The Plan s agent for service of legal process ThyssenKrupp Elevator Corporation 1995 N. Park Place Suite 370 Atlanta, GA Legal process may also be served on the Plan Trustee. 14

17 Pension Benefit Guaranty Corporation Since the Plan is a defined contribution plan, its benefits are not insured by the Pension Benefit Guaranty Corporation. Future of the Plan The Company expects to continue the Plan indefinitely, but reserves the right to amend, discontinue or terminate it at any time. If the Plan terminates, you will automatically become fully vested in your interest in the Plan. Each of your Accounts will be adjusted to reflect expenses, investment gains and losses, and unallocated contributions, and will then be distributed to you (or your beneficiary). YOUR RIGHTS UNDER FEDERAL LAW As a participant in the Plan, you are entitled to certain rights and protections under the Employee Retirement Income Security Act of 1974 (ERISA). You are entitled to: examine, without charge, at the Plan Administrator s office and at other specified locations, such as worksites, all Plan documents and a copy of the latest annual report (Form 5500 Series) filed by the Plan with the U.S. Department of Labor and available at the Public Disclosure Room of the Employee Benefits Security Administration. obtain, upon written request to the Plan Administrator, copies of documents governing the operation of the Plan and copies of the latest annual report (Form 5500 Series) and updated summary plan description. The Plan Administrator may make a reasonable charge for the copies. receive a summary of the Plan s annual financial report. The Plan Administrator is required by law to furnish each participant with a copy of this summary annual report. obtain a statement telling you about the status of your benefits (including your vested status) under the Plan. The Plan is required to provide the statement only upon written request, and no more than once every 12 months. However, in fact, Fidelity automatically provides you with such a statement four times a year. The statement shows the value of your Accounts and the extent to which your Accounts are vested. In addition to creating rights for Plan participants, ERISA imposes duties on the people who are responsible for the operation of the Plan. The people who operate your Plan, called fiduciaries of the Plan, have a duty to do so prudently and in the interest of you and other Plan participants and beneficiaries. No one, including your employer, your union, or any other person, may fire you or otherwise discriminate against you in any way in order to prevent you from obtaining a retirement benefit or exercising your rights under ERISA. If your claim for a retirement benefit is denied or ignored in whole or in part, you have a right to know why this was done, to obtain copies of documents relating to the decision without charge, and to appeal any denial, all within certain time schedules. Under ERISA, there are steps you can take to enforce the above rights. For example, if you request a copy of the Plan document or the latest annual report from the Plan and do not receive them within 30 days, you may file suit in a Federal court. In such a case, the court may require the Plan Administrator to provide the materials and pay you up to $110 a day until you receive the materials, unless the materials were not sent because of reasons beyond the control of the Plan Administrator. If you have a claim for benefits which is denied or ignored, in whole or in part, you may file suit in a state or Federal court after you have exhausted the Plan s claims procedures (see CLAIMS AND APPEALS beginning on page 14). In addition, if you disagree with the Plan s decision or lack thereof 15

18 concerning the qualified status of a domestic relations order, you may file suit in Federal court. If it should happen that the Plan s fiduciaries misuse the Plan s money, or if you are discriminated against for asserting your rights, you may seek assistance from the U.S. Department of Labor, or you may file suit in a Federal court. The court will decide who should pay court costs and legal fees. If you are successful, the court may order the person you have sued to pay these costs and fees. If you lose, the court may order you to pay these costs and fees, for example, if it finds your claim was frivolous. If you have any questions about the Plan, you should contact the Plan Administrator. If you have any questions about your rights under ERISA, or if you need assistance in obtaining documents from the Plan Administrator, you should contact the nearest office of the Employee Benefits Security Administration, U.S. Department of Labor, listed in your telephone directory, or the Division of Technical Assistance and Inquiries, Employee Benefits Security Administration, U.S. Department of Labor, 200 Constitution Avenue, NW, Washington, DC You may also obtain certain publications about your rights and responsibilities under ERISA by calling the publication hotline of the Employee Benefits Security Administration. 16