Exhibit 10.1(ai)

 

AMENDMENT NUMBER FOUR
TO
SAUER-DANFOSS EMPLOYEES’
SAVINGS PLAN

(Formerly the Sauer-Sundstrand Employees’ Savings
and Retirement Plan, As Amended and Restated,
Effective January 1, 1997 and Renamed As of January 1, 2001)

 

By virtue and in exercise of the amending power reserved to Sauer Danfoss
Company (the “Company”) by subsection 14.1 of the Sauer-Danfoss Employees’
Savings Plan (formerly, the Sauer-Sundstrand Employee’s Savings and Retirement
Plan), As Amended and Restated as of January 1, 1997 and Renamed as of January
1, 2001 (the “Plan”), and pursuant to the authority delegated to the undersigned
officer of the Company by the Employee Benefit Committee of the Company, the
Plan is hereby amended, effective as of January 1, 2002, by adding on Appendix A
thereto in the form of the attached Appendix A.

 

IN WITNESS WHEREOF, the above amendment is adopted this 8th day of February,
2002.

 

 

 

SAUER DANFOSS COMPANY

 

 

 

 

 

By:

/s/ Kenneth P. McCuskey

 

 

  Kenneth P. McCuskey

 

  Vice President Finance

 

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SAUER-DANFOSS EMPLOYEES’
SAVINGS PLAN

 

APPENDIX A

 

Application of the Economic Growth and Tax Relief Reconciliation Act of 2001

 

This Appendix A is intended to demonstrate good faith compliance with the
requirements of the Economic Growth and Tax Relief Reconciliation Act of 2001
(“EGTRRA”) and is to be construed in accordance with EGTRRA the and guidance
issued thereunder. The provisions of this Appendix A shall supersede the
applicable provisions of the Plan to the extent those provisions are
inconsistent with the provisions of this Appendix.

 

A-l                               Effective Date. Except as otherwise provided,
this amendment shall be effective as of the first day of the first Plan Year
beginning after December 31, 2001.

 

A-2.                         Limits on Contributions. Notwithstanding the
provisions of Section 6.3 of the Plan, effective for Limitation Years beginning
after December 31, 2001:

 

(a)                                  Except to the extent permitted under 414(v)
of the Code, if applicable, the “annual addition” (as defined in subsection
6.3(e)(i) of the Plan) that may be contributed or allocated to a participant’s
account under the Plan for any Limitation Year shall not exceed the lesser of:

 

(i)                                     Forty thousand dollars ($40,000), or
such greater amount determined by the Secretary of the Treasury for that year;
or

 

(ii)                                  One hundred percent (100%) of the
Participant’s Section 415 Compensation during that Limitation Year.

 

For purposes of subsection (ii) immediately above, Section 415 Compensation
shall not include any contribution for medical benefits after separation from
service (within the meaning of Sections 401(h) or 419A(f)(2) of the Code) which
is otherwise treated as an annual addition.

 

A-3.                         Limits on Compensation.

 

(a)                                  Compensation. Notwithstanding the
definition of “Compensation” under subparagraph 1.8 of the Plan, effective for
Plan Years beginning after December 31, 2001, Earnings shall be limited for any
Plan Year to $200,000 per Participant (as adjusted by the Secretary of the
Treasury for cost-of-living increases pursuant to Section 40l(a)(17)(B) of the
Code).

 

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(b)                                 Section 415 Compensation. Notwithstanding
the definition of “Section 415 Compensation” under subparagraph 6.3(e)(ii) of
the Plan, effective for Limitation Years beginning after December 31, 2001, a
Participant’s total annual cash compensation taken into account shall be limited
for any for any Plan Year to $200,000 per Participant (as adjusted by the
Secretary of the Treasury for cost-of-living increases pursuant to Section
401(a)(17)(B) of the Code).

 

A-4.                         Salary Deferral Limitation. Effective for Plan
Years beginning after December 31, 2001 and consistent with Section 6.4 of the
Plan, in no event shall the amount of Pre-tax Contributions made by a
Participant with respect to any calendar year exceed the elective deferral limit
of Code Section 402(g)(5) (as adjusted by the Secretary of the Treasury, which
for 2002 shall be $11,000), reduced by the Participant’s elective deferrals for
such tax year under any other salary reduction arrangement (i.e., under any Code
Section 401(k) or 403(b) plan), except to the extent permitted under Section
414(v) of the Code, if applicable.

 

A-5.                         Benefit and Contribution Limitations - Multiple Use
of Alternative Limitation. Notwithstanding Section 6.7 of the Plan, the
restriction on the multiple use of the “alternative limitation,” which may occur
as a result of the testing under the limitations described in Sections 6.5 and
6.6 of the Plan, shall not apply for Plan Years beginning after December 31,
2001,

 

A-6.                         Involuntary Cash-Outs. Effective after December 31,
2001, for purposes of determining whether the sum of such a Participant’s vested
Account balances is less than or equal to $5,000 in accordance with subsection
12.5 of the Plan, the balance of the Participant’s Rollover Contribution Account
(and earnings allocated thereto) shall be disregarded. If the sum of the
Participant’s vested Account balances is less than or equal to $5,000 without
regard to the balance of his or her Rollover Contribution Account (and earnings
allocated thereto), the Plan Administrator shall direct the Trustee to
distribute the Participant’s vested Account balance in a lump sum (in cash)
without the consent of the Participant (or Beneficiary) in accordance with
subsection 12.5 of the Plan.

 

A-7.                         Rollover Rules.

 

(a)                                  Rollover Contributions. Effective for
eligible rollover distributions received after December 31, 2001, the provisions
of Section 402(c) of the Code that are incorporated under Section 5.3 of the
Plan are modified as follows:

 

(i)                                     Direct Rollovers. The Plan will accept
an eligible rollover distribution from a qualified plan described in Section 401
(a) of the Code, excluding after-tax employee contributions.

 

(ii)                                  Participant Rollovers from Another
Tax-Qualified Plan. The Plan will accept as a Rollover Contribution a
distribution that a Participant received that is an eligible rollover
distribution from qualified plan described in Section 401 (a) of the Code,
excluding after-tax employee contributions.

 

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(iii)                               Participant Rollovers from an IRA. The Plan
will accept as a Rollover Contribution a portion of a distribution that a
Participant receives from an individual retirement account or annuity described
in Section 408(a) or 408(b) of the Code that is eligible to be rolled over and
would otherwise be includible in gross income.

 

(b)                                 Direct Rollovers of Plan Distributions.
Effective for Plan distributions made after December 31, 2001, the provisions of
Section 402(c) of the Code that are incorporated under Section 12.11 of the Plan
are modified as follows:

 

(i)                                     An “eligible retirement plan” shall also
mean an annuity contract described in Code Section 403(b) and an eligible plan
under Code Section 457(b) that is maintained by a state, political subdivision
of a state, or, any agency or instrumentality of a state or political
subdivision of a state and that agrees to separately account for amounts
transferred into such plan from this Plan. Notwithstanding Section 12.11 of the
Plan, the definition of eligible retirement plan shall also apply in the case of
a distribution to a Spouse or a former spouse who is the alternate payee under a
qualified domestic relation order, as defined in Code Section 4l4(p).

 

(ii)                                  An “eligible rollover distribution” shall
be modified to exclude any amount that is distributed on account of hardship and
the distributee may not elect to have any portion of such a distribution paid
directly to an eligible retirement plan.

 

(iii)                               An “eligible rollover distribution” shall be
modified to include Post-tax Contributions; provided, however, that such
Post-tax Contributions are transferred to an individual retirement annuity
described in Code Section 408(b), an annuity plan described in Code Section
403(a), or to a qualified defined contribution plan described in Code Sections
401(a) or 403(a) that agrees to separately account for the portion of such
distribution that is includible in gross income and the portion of such
distribution which is not so includible.

 

A-8.                         Hardship Withdrawals. Notwithstanding subsection
11.2 of the Plan, a Participant who receives a hardship withdrawal after
December 31, 2001 under Section 11.2 of the Plan shall have his or her Pre-tax
Contributions and Post-tax Contributions suspended for 6 months beginning on the
date as of which he or she receives the hardship withdrawal.

 

A-9.                         Top Heavy Rules. Notwithstanding the provisions of
Article 15 of the Plan, effective for Plan Years beginning after December 31,
2001, this Section A-9 shall apply for purposes of determining whether the Plan
is a Top-Heavy Plan under Section 416(g) of the Code and whether the Plan
satisfies the minimum contribution requirements of Section 416(c) of the Code
for such years.

 

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(a)                                  Determination of present values and
amounts. Notwithstanding Section 15.2 of the Plan, rhis subsection A-9(a) shall
apply for purposes of determining the amounts of account balances of Employees
as of the determination date.

 

(i)                                     Distributions during Year Ending on the
Determination Date. The amounts of account balances of an Employee as of the
determination date shall be increased by the distributions made with respect to
the Employee under the Plan and any plan aggregated with the Plan under Section
416(g)(2) of the Code during the 1-year period ending on the determination date.
The preceding sentence shall also apply to distributions under a terminated plan
which, had it not been terminated, would have been aggregated with the Plan
under Section 416(g)(2)(A)(i) of che Code, In the case of a distribution made
for a reason other than a Severance from Service, death, or Disability, this
provision shall be applied by substituting 5-year period for 1-year period.

 

(ii)                                  Employees not Performing Services during
Year Ending on the Determination Date. The accounts of any individual who has
not performed services for an Employer during the 1-year period ending on the
determination date shall not be taken into account.

 

(b)                                 Key Employee. Notwithstanding the definition
of “Key Employee” under Section 15.2(f) of the Plan, effective for Plan Years
beginning after December 31, 2001, “Key Employee” means any Employee or former
Employee (including any deceased Employee) who at any time during the Plan Year
that includes the determination date was (i) an officer of an Employer having
annual compensation greater than $130,000 (as adjusted under Section 416(i)(l)
of the Code for Plan Years beginning after December 31, 2002), (ii) a 5% owner
of an Employer, or (iii) a 1% owner of an Employer having annual compensation of
more than $150,000. For this purpose, annual compensation means compensation
within the meaning of Section 415(c)(3) of the Code. The determination of who is
a Key Employee will be made in accordance with Section 416(i)(l) of the Code and
the applicable regulations and other guidance of general applicability issued
thereunder.

 

(c)                                  Minimum Benefits. Matching Contributions
shall be taken into account for purposes of satisfying the minimum contribution
requirements of Section 416(c)(2) of che Code and Section 15.4 of the Plan. The
preceding sentence shall apply with respect to Matching Contributions under the
Plan or, if under Section 15.4 of the Plan the minimum contribution requirement
shall be met in another plan, such other plan. Matching Contributions that are
used to satisfy the minimum contribution requirements shall be treated as
Matching Contributions for purposes of the Actual Contribution Percentage test
and other requirements of Section 401(m) of the Code and Section 6.6 of the
Plan.

 

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