Exhibit 10.2

 

BURLINGTON NORTHERN SANTA FE CORPORATION

 

SUPPLEMENTAL INVESTMENT AND RETIREMENT PLAN

 

Effective January 1, 1997, as amended through July 21, 2005

 

ARTICLE I - GENERAL

 

Section 1.1 Establishment of Plan and Purpose. Burlington Northern Santa Fe
Corporation, a Delaware Corporation, (hereinafter the “Company”), has
established the Burlington Northern Santa Fe Supplemental Investment and
Retirement Plan, (hereinafter the “Plan”), effective January 1, 1997. This plan
is intended to replace the Burlington Northern Inc. Restoration Plan and the
Santa Fe Pacific Corporation Supplemental Retirement and Savings Plan, and both
plans shall hereby be merged into this Plan, provided, however, that any
compensation deferred under the terms of a predecessor plan shall be distributed
pursuant to the terms of the deferral election made under such plan. The purpose
of this Plan is to provide certain highly compensated employees of the Company
and certain of its subsidiaries (hereinafter the “Employing Companies”), the
opportunity to defer the receipt of compensation and to receive additional
retirement income from the Employing Companies. This plan is not intended to
qualify under Section 401(a) of the Internal Revenue Code of 1986, as amended
(hereinafter the “Code”), or be subject to Parts 2, 3, or 4 of Title I of the
Employee Retirement Income Security Act of 1974, as amended (hereinafter
“ERISA”).

 

Section 1.2 Affiliated Companies. The term “Affiliated Company” shall mean every
corporation (including the Company) which is a member of a controlled group of
corporations (within the meaning of Section 414(b) of the Internal Revenue
Code). The Company and each Affiliated Company which, with the consent of the
Chief Executive Officer or Board of Directors of the Company, adopts the Plan
are referred to herein collectively as the “Employing Companies” and
individually as an “Employing Company”.

 

Section 1.3 Plan Administration. The authority to control and manage the
operation and administration of the Plan shall be vested in the Vice President –
Human Resources and Medical of the Company (hereinafter the “Administrator”).
Any interpretation of the Plan by the Administrator or the Administrator’s
delegate and any decision made by the Administrator or the Administrator’s
delegate on any other matter within the Administrator’s discretion are final and
binding on all persons. The Administrator shall have discretionary authority to
administer, construe and interpret the Plan, to decide all questions including
but not limited to eligibility, payment of any benefits hereunder and to make
all other determinations deemed necessary or advisable for the administration of
the Plan, provided, however, that any person claiming entitlement to benefits in
an amount other than that received shall have the right after review and denial,
in whole or in part, of such claim by the Administrator to a review of such
denial by the Burlington Northern Santa Fe Employee Benefits Committee
(hereinafter the “Committee”). Such review shall be initiated by the written
request therefore by such person filed with the Committee within 60 days after
receipt by the person of the denial by the Administrator.

--------------------------------------------------------------------------------

The Committee shall act with or without a meeting by the vote or concurrence of
a majority of its members; but no member of the Committee who is a Participant
shall take part in any Committee action or any matter that has particular
reference to his own interest hereunder. The Administrator and the Committee
shall discharge their responsibilities hereunder in a uniform and
non-discriminatory manner as to all Participants.

 

The Administrator and the Committee may from time to time delegate duties to
members of the Human Resources Department or other employees of the Company.

 

Section 1.4 Non-Alienation. Benefits payable to any individual under the Plan
may not be voluntarily or involuntarily assigned, alienated, pledged or subject
to attachment, anticipation, garnishment, levy, execution or other legal or
equitable process.

 

Section 1.5 Source of Benefits. Subject to the terms and conditions of the Plan,
any amount payable to or on account of a Participant under this Plan by any
Employing Company shall be paid from the general assets of that Employing
Company or from one or more trusts, the assets of which are subject to the
claims of the Employing Companies’ general creditors. None of the individuals
entitled to benefits under the Plan shall have any preferred claim on, or any
beneficial ownership interest in, any assets of any Employing Company or of any
such trust, and any rights of such individuals under the Plan or any such trust
shall constitute unsecured contractual rights only.

 

Section 1.6 Plan Not Contract of Employment. The Plan does not constitute a
contract of employment, and nothing in the Plan will give any participant the
right to be retained in the employ of any Employing Company, nor any right or
claim to any benefit under the Plan, except to the extent specifically provided
under the terms of the Plan.

 

Section 1.7 Notices. Any notice or document required to be given to or filed
with an Employing Company, the Company, the Administrator or the Committee shall
be considered to be given or filed:

 

(a) on the date delivered to the Administrator;

 

or

 

(b) three days after the date sent by certified mail to the Administrator.

 

Section 1.8 Applicable Law. The Plan shall be construed and administered in
accordance with the internal laws of the State of Texas.

 

Section 1.9 Gender and Number. Where the context admits, words in any gender
shall include any other gender, words in the singular shall include the plural
and the plural shall include the singular.

 

Section 1.10 Plan Year. The Plan Year shall be the calendar year.

--------------------------------------------------------------------------------

ARTICLE II - PARTICIPATION

 

Section 2.1 Participation. The Company shall establish from time to time the
Employing Companies which may participate and the class of highly-compensated
employees of each Employing Company who shall be eligible for the benefits
provided in Article IV below (hereinafter the “Participants”); provided,
however, that the class of eligible employees of each Employing Company shall be
limited to employees who are members of a select group of management or highly
compensated employees within the meaning of Section 401(a)(1) of ERISA.
Employees shall be eligible to commence participation in the Plan 30 days after
they become members of the class of highly-compensated employees described in
the preceding sentence. If the Company determines that participation by one or
more Participants shall cause the Plan as applied to any Employing Company to be
subject to Parts 2, 3, or 4 of Title I of ERISA, the entire interest of such
Participant or Participants under the Plan shall be immediately paid to such
Participant by the applicable Employing Company, notwithstanding any election of
the Participant, or shall otherwise be segregated from the Plan in the
discretion of the Company, and such Participant or Participants shall cease to
have any interest under the Plan.

 

ARTICLE III - VESTING

 

Section 3.1 Vesting. A Participant shall be fully vested in his deferral amounts
and earnings at all times and subject to investment gains and losses. A
Participant shall be vested in Employer Matching Contributions in accordance
with the vesting schedule set forth in Article 6 of the Burlington Northern
Santa Fe Investment and Retirement Plan (the “Investment Plan”).

 

ARTICLE IV - DEFERRALS

 

Section 4.1 Deferral Elections. To become a Participant, subject to such
additional terms, conditions and limitations as the Administrator may from time
to time impose, a Participant may make an election to irrevocably defer receipt
of certain eligible compensation otherwise payable to him by his Employer for a
Plan Year by means of such procedures as are approved by the Administrator,
including filing a Deferral Election Form or by telephonic voice response or
other telephonic or electronic transmission indicating his or her desire to have
a portion of his or her eligible compensation deferred, or by failing to
indicate a desire not to participate in the Plan. Such deferral elections shall
be made as follows:

 

(a) Unless the Compensation and Development Committee of the Board otherwise
specifies, a Participant may elect to defer (i) up to 25% of base salary that is
not eligible Compensation under the Investment Plan, (ii) up to 25% of any cash
incentive payments that are not eligible Compensation under the Investment Plan,
and iii) to the extent that a Participant is subject to a limitation on
before-tax contributions under Section 402(g)(1) of the Code to the Investment
Plan, the amounts which could have been deferred into the Investment Plan but
for such limitation (“Deferred Compensation”).

 

(b) Such elections shall be made at such time and in such manner as the
Administrator shall provide by the close of the year before the year in which
the services giving

--------------------------------------------------------------------------------

rise to the eligible compensation are performed, provided, however, that the
Administrator may prescribe such other time or times as are consistent with
Section 409A of the Code. In the case of the first year in which a Participant
becomes eligible to participate in the Plan, such election may be made with
respect to services to be performed subsequent to the election within 30 days
after the date the participant becomes eligible to participate in the Plan. An
election must specify the percentage, if any, which the Participant chooses to
defer and authorize his Employing Company to make regular payroll deductions.

 

(c) A Participant may elect to suspend all future deferrals in a Plan Year other
than in respect to incentive payments, and will not be permitted to resume
participation until the next Plan Year.

 

Section 4.2 Employer Matching Contribution. Subject to such limitations as the
Administrator may from time to time impose, for each Plan Year, Participants
shall be credited with an “Employer Matching Contribution” with respect to 100%
of the compensation deferred hereunder that would be payable during that Plan
Year, provided that Employer Matching Contributions shall be equal to 50% of
Deferred Contributions deferred up to 6% of Compensation hereunder.

 

To the extent that additional employer contributions are made pursuant to the
second paragraph of Section 4.5 of the Investment Plan by reason of the
attainment of financial and other objectives of an Employing Company,
Participants who have Accounts in the Plan when such contributions are made
shall be credited after the close of the Plan Year to which such objectives
relate with an additional Employer Matching Contribution. The amount of such
additional Employer Matching Contributions shall be equal to the same uniform
percentage, not to exceed 30% of the Deferred Contributions up to 6 percent of
Compensation actually made hereunder, as is credited pursuant to the second
paragraph of Section 4.5 of the Investment Plan.

 

ARTICLE V - PLAN ACCOUNTING

 

Section 5.1 Accounts. The Administrator shall establish an Account for each
Participant who elects to participate in the Plan under subsection 4.1. Each
Account shall be adjusted in accordance with this Article V in a uniform,
non-discriminatory manner, as of such periodic “Accounting Dates” as may be
determined by the Administrator from time to time (which Accounting Dates shall
be not less frequent than quarterly). As of each Accounting Date, the balance of
each Account shall be adjusted as follows:

 

(a) first, charge to the Account balance the amount of any distributions under
the Plan with respect to that Account that have not previously been charged;

 

(b) then, credit to the Account balance the amount of the compensation to be
deferred by the Participant in accordance with the provisions of subsection 4.1
and the amount of Employer Matching Contributions to be credited in accordance
with Section 4.2 that have not previously been credited;

--------------------------------------------------------------------------------

(c) then, adjust the Account balance for the applicable assumed rate of earnings
in accordance with subsection 5.2.

 

Section 5.2 Adjustment of Accounts for Earnings. The amounts credited to a
Participant’s Account in accordance with subsections 4.1 and 4.2 shall be
adjusted as of each Accounting Date to reflect the value of an investment equal
to the Participant’s Account balance in one or more assumed investments that the
Committee offers from time to time, and which the Participant directs the
Administrator to use for purposes of adjusting his Account. Such amount shall be
determined without regard to taxes that would be payable with respect to any
such assumed investment. The Committee may eliminate any assumed investment
alternative at any time; provided, however, that the Committee may not
retroactively eliminate any assumed investment alternative. To the extent
permitted by the Administrator, the Participant may elect to have different
portions of his Account balance for any period adjusted on the basis of
different assumed investments. The Account of each Participant shall be credited
with the amount deferred by the Participant as of the date on which the amount
of such Deferred Compensation is communicated to the Plan recordkeeper which
shall be as soon as reasonably practicable after the date the compensation would
otherwise have been payable to the Participant, or, if such date is not an
Accounting Date, as of the first Accounting Date occurring thereafter.
Notwithstanding the election by Participants of certain assumed investments and
the adjustment of their Accounts based on such investment decisions, the Plan
does not require, and no trust or other instrument maintained in connection with
the Plan shall require that any assets or amounts which are set aside in a trust
or otherwise for the purpose of paying Plan benefits shall actually be invested
in the investment alternatives selected by Participants.

 

Section 5.3 Participant Statements. At least quarterly, the Administrator shall
cause to be furnished to each Participant a statement indicating, on the basis
of the latest available information, the status of the Participants’ Accounts.

 

ARTICLE VI - PAYMENT OF DEFERRED AMOUNTS

 

Section 6.1 Separation from Service. Subject to the provisions of subsection 1.5
and such other rules as the Administrator may establish, upon a Participant’s
death or separation from service, the Participant’s entire Account balance,
including the Employer’s Matching Contribution on amounts deferred prior to the
Participant’s death or separation date, shall be paid to or on account of the
Participant as follows:

 

(a) in a single lump sum payment as soon as practicable after his date of death;

 

(b) in a single lump sum payment on or about July 31 of the year following
separation; or

 

(c) if elected by the Participant (i) prior to January 1, 2005, and at least one
year prior to the distribution or (ii) within 30 days after the date he becomes
eligible to participate in the Plan, in annual installments over a period of
five or fewer years, beginning on or about July 31 of the calendar year
following the date of his separation from service.

--------------------------------------------------------------------------------

Section 6.2 Beneficiary Designation. Each Participant may, from time to time by
signing a form furnished by the Administrator, designate any legal or natural
person or persons (who may be designated contingently or successively) to whom
his benefits under the Plan are to be paid if he dies before he receives all of
his benefits. A beneficiary designation form will be effective only when the
signed form is filed with the Administrator while the Participant is alive. A
beneficiary designation may be revoked or amended only by the completion of a
new beneficiary designation form, provided, however, that if a Participant’s
spouse is named as such Participant’s beneficiary, and the Participant and such
spouse are subsequently divorced, then the designation of the spouse made prior
to the divorce shall be null and void. In order to designate a former spouse as
a beneficiary, a new beneficiary designation form must be completed. If a
deceased Participant failed to designate a beneficiary as provided above, or if
the designated beneficiary of a deceased Participant died before him, his
benefits shall be paid in accordance with the following order of priority: (i)
to his surviving spouse, if any; (ii) to his surviving children in equal shares;
or (iii) the estate of the last to die of the Participant or his designated
beneficiary. The benefits under this plan which are payable to a beneficiary
shall be paid in a lump sum.

 

Section 6.3 Withholding for Tax Liability. The Company may withhold or cause to
be withheld from any payment of benefits made pursuant to the Plan any taxes
required to be withheld with regard to such payment.

 

ARTICLE VII - CHANGE IN CONTROL

 

Section 7.1 Change in Control. In the event of a change in control as defined in
The Burlington Northern and Santa Fe Railway Company Severance Agreements, all
Accounts shall be fully vested, and the Company shall be obligated to transmit
funds equal to the outstanding liabilities under this Plan to such trust as may
be established by the Company to provide for security of benefits hereunder.

 

ARTICLE VIII - AMENDMENT OR TERMINATION

 

Section 8.1 Amendment or Termination. This Plan may be amended at any time and
from time to time by the Chief Executive Officer of the Company or resolution of
the Board of Directors of the Company; provided however, the Chief Executive
Officer of the Company may not amend the Plan in any manner which would make
benefit or other changes materially increasing an Employing Company’s
liabilities under the Plan, make amendments required by law to be approved by
the Board of Directors or a committee thereof, make amendments which change the
design of the Plan with respect to the allocation of responsibilities, or make
changes affecting the Company’s indemnification obligations. The Board of
Directors of the Company may terminate the Plan at any time without the consent
of the participants or beneficiaries. No amendment or termination shall divest
any Participant or beneficiary of the credits to his Account, or any rights to
which he would have been entitled if the Plan had been terminated immediately
prior to the effective date of such amendment or termination. Any Employing
Company may terminate its participation in the Plan at any time, provided that
it has made adequate provision for any amount payable by it under the terms of
the Plan as in effect on the

--------------------------------------------------------------------------------

date it terminates its participation in the Plan. Upon termination of the Plan
as to any Employing Company, the Company may, in its discretion applied in a
uniform manner, provide that amounts attributable to that Employing Company
shall be distributed in accordance with the provisions of 6.1. Upon termination
of the Plan as to all Employing Companies, the Company may, in its sole
discretion applied in a uniform manner to all Participants, cause a lump sum
payment of all benefits for all Participants to be made as soon as reasonably
practicable on the date established for payment under subsection 6.1(b).