Document:

Ex-10.4

 

Exhibit 10.4

AMENDMENT NO. 5 AND INSTRUMENT OF BENEFIT FREEZE

TO THE NORTH AMERICAN COAL CORPORATION

SUPPLEMENTAL RETIREMENT BENEFIT PLAN

(As Amended and Restated effective September 1, 1994)

          WHEREAS, The North American Coal Corporation (the “Company”) amended and
restated The North American Coal Corporation Supplemental Retirement Benefit
Plan (the “Plan”) effective September 1, 1994 and has since amended the Plan;
and

          WHEREAS, the Plan is classified as a “nonqualified deferred compensation
plan” under the Internal Revenue Code of 1986, as amended (the “Code”); and

          WHEREAS, the American Jobs Creation Act of 2004, P.L. 108-357 (the “AJCA”)
added a new Section 409A to the Code, which significantly changed the Federal
tax law applicable to “amounts deferred” under the Plan after December 31,
2004; and

          WHEREAS, pursuant to the AJCA, the Secretary of the Treasury and the
Internal Revenue Service will issue proposed, temporary or final regulations
and/or other guidance with respect to the provisions of new Section 409A of the
Code (collectively, the “AJCA Guidance”); and

          WHEREAS, the AJCA Guidance has not yet been issued; and

          WHEREAS, to the fullest extent permitted by Section 409A of the Code and
the AJCA Guidance, the Company wants to protect the “grandfathered” status of
the Supplemental Retirement Benefits that are accrued prior to January 1, 2005;
and

          WHEREAS, due to the uncertainty regarding the affect of the AJCA on
Supplemental Retirement Benefits under the Plan, the Company has decided to
temporarily freeze all Supplemental Retirement Benefits as of December 31,
2004;

          NOW, THEREFORE, the Company hereby adopts this Amendment No. 5 to the
Plan, which amendment is intended to (1) allow amounts deferred prior to
January 1, 2005 to qualify for “grandfathered” status and continue to be
governed by the law applicable to nonqualified deferred compensation prior to
the addition of Section 409A of the Code (as specified in the Plan as in effect
prior January 1, 2005); and (2) temporarily freeze the accrual of Supplemental
Retirement Benefits hereunder as of December 31, 2004.

Words and phrases used herein with initial capital letters that are defined in
the Plan are used herein as so defined and the provisions hereof shall be
effective as of the close of business on December 31, 2004.

Section 1

          Article I of the Plan is hereby amended by the addition of the following
new Section 1.6 at the end thereof to read as follows:

          “Section 1.6 American Jobs Creation Act (AJCA).

     (a) To the extent applicable, it is intended that the Plan (including all
Amendments thereto) comply with the provisions of Section 409A of the Code, as
enacted by the AJCA, so as to prevent the

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inclusion in gross income of any
amount of Supplemental Retirement Benefit accrued hereunder in a taxable year
that is prior to the taxable year or years in which such amounts would
otherwise be actually distributed or made available to the Participants. The
Plan shall be administered in a manner that will comply with Section 409A of
the Code, including proposed, temporary or final regulations or any other
guidance issued by the Secretary of the Treasury and the Internal Revenue
Service with respect thereto (collectively with the AJCA, the “AJCA Guidance”).
Any Plan provisions (including, without limitation, those added or amended by
Amendment No. 5) that would cause the Plan to fail to satisfy Section 409A of
the Code shall have no force and effect until amended to comply with Code
Section 409A (which amendment may be retroactive to the extent permitted by the
AJCA Guidance).

     (b) The Plan Administrator shall not take any action that would violate
any provision of Section 409A of the Code. The Plan Administrator is
authorized to adopt rules or regulations deemed necessary or appropriate in
connection with the AJCA Guidance to anticipate and/or comply with the
requirements thereof (including any transition or grandfather rules
thereunder).

     (c) The effective date of Amendment No. 5 to the Plan is December 31,
2004. This Amendment temporarily freezes the Supplemental Retirement Benefits
under the Plan effective as of December 31, 2004, with the intent being that
the Company will rescind the freeze upon issuance of the AJCA Guidance. In
furtherance of, but without limiting the foregoing, any Supplemental Retirement
Benefit that is deemed to have been deferred prior to January 1, 2005 and that
qualifies for “grandfathered status” under Section 409A of the Code shall
continue to be governed by the law applicable to nonqualified deferred
compensation prior to the addition of Section 409A to the Code and shall be
subject to the terms and conditions specified in the Plan as in effect prior to
January 1, 2005.”

Section 2

               The fourth sentence of Section 2.1(2)(B) of the Plan is hereby amended to
read as follows:

“The change of a Beneficiary under the Plan may be made, and may be
revoked, only by an instrument (in a form acceptable to the Company)
signed by the Participant and filed with the Plan Administrator prior to
the Participant’s death.”

Section 3

               Section 2.1(10) of the Plan is hereby amended in its entirety to read as
follows:

               “(10) “Pension Plan” shall mean The NACCO Industries, Inc. Pension
Plan for Salaried Employees (terminated November 30, 1986), or Part I of
the Combined Defined Benefit Plan for NACCO Industries, Inc. and Its
Subsidiaries, which includes The NACCO Industries, Inc. Pension Plan for
Salaried Employees which was merged into such plan on December 31, 1993)
(“Plan 005”). Pension accruals under Plan 005 for employees of NACCO
Industries, Inc. were generally frozen as of December 31, 1993 and
pension accruals under Plan 005 for employees of all other Employers were
generally frozen as of December 31, 2004; provided that such frozen
benefits are increased by a specified percentage for each year (in
accordance with the terms of Plan 005).”

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Section 4

               Article III of the Plan is hereby amended by the addition of the following
new Section 3.2C thereto, immediately following Section 3.2B, to read as
follows:

     “Section 3.2C Benefit Freeze. Notwithstanding any provision of the
Plan to the contrary, all Supplemental Retirement Benefits under the Plan
shall be frozen as of December 31, 2004. In furtherance thereof, but
without limiting the foregoing, a Participant shall not receive credit
under this Plan for any service or compensation that is earned after
December 31, 2004 (even if such service and compensation is taken into
account for purposes of calculating the Actual Pension Plan Benefit).
The Company intends that Supplemental Retirement Benefits that are
accrued (and, only if required under the AJCA Guidance, vested) on or
before December 31, 2004 will qualify for “grandfathered” status under
the AJCA and will continue to be governed by the law applicable to
nonqualified deferred compensation prior to the addition of Section 409A
of the Code.”

Section 5

               Section 4.1 of the Plan is hereby amended by the addition of the following
new sentence at the end thereof to read as follows:

“Notwithstanding the foregoing, to the extent that the provisions of
Amendment No. 7 to Plan 005 (i.e., the provision that fully vests all
Participants in their Pension Plan benefits as of December 31, 2004)
would otherwise be deemed a “material amendment” under the AJCA Guidance
and cause Section 409A of the Code to apply to “grandfathered” benefits
hereunder, such provisions of Amendment No. 7 to Plan 005 shall not be
taken into account in determining a Participant’s vested interest in his
Supplemental Retirement Plan Benefit hereunder.”

Section 6

               Section 5.2 of the Plan is hereby amended by adding the following new
clause to the end thereof, to read as follows:

     “and provided further that this provision shall not apply to the extent it
violates Code Section 409A.”

Section 7

               The first sentence of Section 5.4 of the Plan is hereby amended to read as
follows:

“Any member of the Controlled Group that has adopted a Pension Plan may
become an Employer hereunder with the written consent of the NACCO
Industries, Inc. Benefits Committee (the “Benefits Committee”) if it
executes an “Instrument of Adoption” evidencing its adoption of the Plan
and files a copy thereof with the Company.”

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Section 8

     Section 5.5(1) of the Plan is hereby amended in its entirety to read as
follows:

     “(1) The Compensation Committee shall be responsible for the general
administration of the Plan and for carrying out the provisions hereof
and, for purposes of the Employee Retirement Income Security Act of 1974,
as amended, the Company shall be the plan sponsor and the plan
administrator. The Compensation Committee shall interpret where
necessary, in its reasonable and good faith judgment, the provisions of
the Plan and, except as otherwise provided in the Plan, shall determine
the rights and status of Participants and Beneficiaries hereunder
(including, without limitation, the amount of any Supplemental Retirement
Benefit to which a Participant or Beneficiary may be entitled under the
Plan); provided, however, that the Compensation Committee shall not take
any action that violates Code Section 409A.”

Section 9

     Section 5.7 of the Plan is hereby amended in its entirety to read as
follows:

     “Section 5.7 Claims Procedure.

     (1) Any Participant or Beneficiary who believes that he is entitled
to receive a benefit under the Plan which he has not received may file
with the Compensation Committee a written claim specifying the basis for
his claim and the facts upon which he relies in making such a claim.
Such a claim must be signed by the claimant or his duly authorized
representative (the “Claimant”).

     (2) Whenever the Compensation Committee denies (in whole or in
part), a claim for benefits filed by a Claimant, the Compensation
Committee shall transmit a written notice of such decision to the
Claimant, within 90 days after such claim was filed (plus an additional
period of 90 days if required for processing, provided that notice of the
extension of time is given to the Claimant within the first 90 day
period). Such notice shall be written in a manner calculated to be
understood by the Claimant and shall state (a) the specific reason(s) for
the denial of the claim, (b) specific reference(s) to pertinent
provisions of the Plan on which the denial of the claim was based, (c) a
description of any additional material or information necessary for the
Claimant to perfect the claim and an explanation of why such material or
information is necessary, and (d) an explanation of the Plan’s review
procedures under Subsection (3) below and the time limits applicable to
such procedures, including a statement of the Claimant’s right to bring a
civil action under Section 502(a) of ERISA following an adverse benefit
determination on review.

     (3) Within 60 days after the denial of his claim, the Claimant must
request that the claim denial be reviewed by filing with the Compensation
Committee a written request therefor. If such an appeal is not filed
within this 60-day limit, the Claimant shall be deemed to have agreed
with the Compensation Committee’s denial of the claim. If such an appeal
is so filed within such 60 days, a named fiduciary designated by the
Compensation Committee shall (a) conduct a full and fair review of such
claim and (b) mail or deliver to the Claimant a written decision on the
matter based on the facts and pertinent provisions of the Plan within a
period of 60 days after the receipt of the request for review unless
special circumstances require an extension of time, in which case such
decision shall be rendered not later than 120 days after receipt of such
request. If an extension of time for review is required, written notice
of the extension shall be furnished to the Claimant prior to the
commencement of the extension. Such decision (a) shall be written in a
manner calculated to be understood by the Claimant, (b) shall

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state the specific reason(s) for the decision, (c) shall make specific
reference(s) to pertinent provisions of the Plan on which the decision is
based and (d) shall, to the extent permitted by applicable law, be final
and binding on all interested persons. During such full review, the
Claimant shall be given an opportunity to review documents that are
pertinent to the Claimant’s claim and to submit issues and comments in
writing. In addition, the notice of adverse determination shall also
include statements that (a) the Claimant is entitled to receive, upon
request and free of charge, reasonable access to, and copies of, all
documents, records and other information relevant to the Claimant’s claim
for benefits and (b) a statement of the Claimant’s right to bring an
action under Section 502(a) of ERISA.”

Section 10

          The first sentence of Section 6.1 of the Plan is hereby amended to read as
follows:

“Subject to Section 6.3, the Company (with the approval or ratification
of the Benefits Committee) does hereby reserve the right to amend, at any
time, any or all of the provisions of the Plan for all Employers, without
the consent of any other Employer or any Participant, Beneficiary or any
other person.”

Section 11

          The first sentence of Section 6.2(1) of the Plan is hereby amended to read
as follows:

“The Board of Directors of the Company (and/or the Compensation Committee
thereof) does hereby reserve the right to terminate the Plan at any time
for any or all Employers, without the consent of any other Employer or of
any Participant, Beneficiary or any other person.”

Section 12

          Section 6.3(1) of the Plan is hereby amended by adding the following
clause to the end thereof, to read as follows:

“provided, however, that such limitations shall not apply to the extent
deemed necessary by the Company to comply with the requirements of Code
Section 409A.”

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Section 13

          The first sentence of Section 6.3(2) of the Plan is hereby amended by
adding the following clause to the end thereof, read as follows:

     “; to the extent permitted by Code Section 409A.”

          EXECUTED this 28th day of December, 2004.

	 	 	 	 	 	 	 	 	 
	 	 	THE NORTH AMERICAN COAL CORPORATION
	 
	 	 	 	 	 	 	 	 
	

	 	 	 	By:	 	 /s/ Charles A. Bittenbender	 	 
	

	 	 	 	 	 	
 	 	 
	

	 	 	 	 	 	Title: Assistant Secretary	 	 

 6Ex-10.5

 

Exhibit 10.5

AMENDMENT NO. 4

TO THE NORTH AMERICAN COAL CORPORATION

DEFERRED COMPENSATION PLAN FOR MANAGEMENT EMPLOYEES

(As Amended and Restated Effective as of November 1, 2001)

WITH RESPECT TO

THE AMERICAN JOBS CREATION ACT OF 2004

     WHEREAS, The North American Coal Corporation (the “Company”) adopted an
amended and restated Deferred Compensation Plan for Management Employees (the
“Plan”) effective as of November 1, 2000 and has since amended the Plan; and

     WHEREAS, the Plan is classified as a “nonqualified deferred compensation
plan” under the Internal Revenue Code of 1986, as amended (the “Code”); and

     WHEREAS, the American Jobs Creation Act of 2004, P.L. 108-357 (the “AJCA”)
added a new Section 409A to the Code, which significantly changed the Federal
tax law applicable to “amounts deferred” under the Plan after December 31,
2004; and

     WHEREAS, pursuant to the AJCA, the Secretary of the Treasury and the
Internal Revenue Service will issue proposed, temporary or final regulations
and/or other guidance with respect to the provisions of new Section 409A of the
Code (collectively, the “AJCA Guidance”); and

     WHEREAS, the AJCA Guidance has not yet been issued; and

     WHEREAS, pursuant to Article V of the Plan, all amounts credited to a
Participant’s Account under the Plan are 100% vested; and

     WHEREAS, to the fullest extent permitted by Code Section 409A and the AJCA
Guidance, the Company wants to protect the “grandfathered” status of the Excess
Retirement Benefits that were deferred prior to January 1, 2005.

     NOW THEREFORE, the Company hereby adopts this Amendment No. 4 to the Plan,
which amendment is intended to (1) allow amounts deferred prior to January 1,
2005 (including any earnings thereon) to qualify for “grandfathered” status and
continue to be governed by the law applicable to nonqualified deferred
compensation, and the terms of the Plan as in effect, prior to the addition of
Code Section 409A and (2) cause amounts deferred after December 31, 2004 to be
deferred in compliance with the requirements of Code Section 409A.

Words used herein with initial capital letters which are defined in the Plan
are used herein as so defined and the provisions hereof shall be effective
January 1, 2005.

Section 1

     Article I of the Plan is hereby amended by adding a new Section 1.6 to the
end thereof, to read as follows:

     “Section 1.6 American Jobs Creation Act (AJCA).

     (a) It is intended that the Plan (including all Amendments thereto) comply
with the provisions of Section 409A of the Code, as enacted by AJCA, so as to
prevent the inclusion in gross income of any Excess Retirement Benefit
hereunder in a taxable year that is prior to the taxable year or years in which
such amounts would otherwise actually be distributed or made available to the
Participants. The Plan shall be administered in

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a manner that will comply with
Section 409A of the Code, including any proposed, temporary or final
regulations or any other guidance issued by the Secretary of
the Treasury and the Internal Revenue Service with respect thereto
(collectively with the AJCA, the “AJCA Guidance”). Any Plan provisions
(including, without limitation, those added or amended by Amendment No. 4) that
would cause the Plan to fail to satisfy Section 409A of the Code shall have no
force and effect until amended to comply with Code Section 409A (which
amendment may be retroactive to the extent permitted by the AJCA Guidance).

     (b) The Plan Administrator shall not take any action that would violate
any provision of Section 409A of the Code. It is intended that, to the extent
applicable, all Participant elections hereunder will comply with Code Section
409A and the AJCA Guidance. The Plan Administrator is authorized to adopt
rules or regulations deemed necessary or appropriate in connection therewith to
anticipate and/or comply with the requirements thereof (including any
transition or grandfather rules thereunder). In this regard, the Plan
Administrator is authorized to permit Participant elections with respect to
amounts deferred after December 31, 2004 and is also permitted to allow the
Participants the right to amend or revoke such elections in accordance with the
AJCA Guidance.

     (c) The effective date of Amendment No. 4 to this Plan is January 1, 2005.
This Amendment creates additional Sub-Accounts (where necessary) (i) to
reflect amounts that are “deferred” (as such term is defined in the AJCA
Guidance) as of December 31, 2004 (and earnings thereon) (collectively, the
“Grandfathered Sub-Accounts”) and (ii) to reflect amounts that are deferred
after December 31, 2004 (and earnings thereon) (the “Post-2004 Sub-Accounts”).
Amendment No. 4 also modifies the distribution elections and provisions for the
Post-2004 Sub-Accounts to comply with the requirements of Code Section 409A.

     (d) In furtherance of, but without limiting the foregoing, any Excess
Retirement Benefit that is deemed to have been deferred prior to January 1,
2005 and that qualifies for “grandfathered status” under Section 409A of the
Code shall continue to be governed by the law applicable to nonqualified
deferred compensation prior to the addition of Section 409A to the Code and
shall be subject to the terms and conditions specified in the Plan as in effect
prior to the effective date of Amendment No. 4. In particular, to the extent
permitted under AJCA Guidance:

     (i) No additional VAP Deferral Benefits are permitted under the Plan and,
as a result, the VAP Deferral Sub-Account shall be classified as a
Grandfathered Sub-Account and shall be paid under the terms of the Plan as in
effect prior to January 1, 2005; and

     (ii) Amounts allocated to a Participant’s Excess 401(k) Sub-Account and
Excess Matching Sub-Account as of December 31, 2004 shall be credited to the
Participant’s Grandfathered Sub-Accounts and shall be paid under the terms of
the Plan as in effect prior to January 1, 2005; and

     (iii) Amounts allocated to a Participant’s Excess Profit Sharing Account
as of December 31, 2004 including, to the extent permitted by the AJCA
Guidance, the Excess Profit Sharing Benefit for the 2004 Plan Year (which is
allocated to Participants’ Accounts in 2005), shall be credited to the
Participant’s Grandfathered Sub-Account and shall be paid under the terms of
the Plan as in effect prior to January 1, 2005.”

Section 2

     Section 2.1 of the Plan is hereby amended by adding the following
sentences to the end thereof, to read as follows:

     “In addition, the Sub-Accounts shall be further subdivided as follows:
(a) the Excess Profit Sharing Sub-Account shall be divided into the Pre-2005
Excess Profit Sharing Sub-Account and the Post-2004 Excess Profit Sharing
Sub-Account; (b) the Excess 401(k) Sub-Account shall be divided into the
Pre-2005 Excess

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401(k) Sub-Account and the Post-2004 Excess 401(k) Sub-Account
and (c) the Excess Matching Sub-Account shall be divided into the Pre-2005
Excess Matching Sub-Account and the Post-2004 Excess Matching Sub-Account. The
Pre-2005 Excess Profit Sharing Sub-Account, the Pre-2005 Excess

401(k)
Sub-Account, the Pre-2005 Excess Matching Sub-Account and the LTIP Deferral
Sub-Account shall be referred to herein collectively as the “Grandfathered
Sub-Accounts” and the remainder of such Sub-Accounts shall be referred to
herein as the “Post-2004 Sub-Accounts.”

Section 3

     Section 2.5 of the Plan is hereby amended by adding the following new
sentence to the end thereof, to read as follows:

     “Notwithstanding the foregoing, the timing and crediting of Bonuses
hereunder shall be as specified in Section 3.1.”

Section 4

     Section 2.10(c)(i) of the Plan is hereby amended by deleting the phrase
“Profit Sharing Employee” and replacing it with the phrase “Salaried Profit
Sharing Employee” therein.

Section 5

     Section 2.15 of the Plan is hereby amended in its entirety to read as
follows:

     “Section 2.15 Unforeseeable Emergency shall mean an event which results in
a severe financial hardship to the Participant as a consequence of (a) an
illness or accident of the Participant, the Participant’s spouse or a dependent
within the meaning of Code Section 152, (b) loss of the Participant’s property
due to casualty or (c) other similar extraordinary and unforeseeable
circumstances arising as a result of events beyond the control of the
Participant.”

Section 6

     Article II of the Plan is hereby amended by adding the following new
definitions to the end thereof, to read as follows:

     “Section 2.18 Bonus shall mean any bonus under The North American Coal
Corporation Annual Incentive Compensation Plan that would be taken into account
as Compensation under the Savings Plan, which is earned with respect to
services performed by a Participant during a Plan Year (whether or not such
Bonus is actually paid to the Participant during such Plan Year). An election
to defer a Bonus under this Plan must be made before the period in which the
services are performed which gives rise to such Bonus.

     Section 2.19 Key Employee shall mean a key employee, as defined in
Section 416(i) of the Code (without regard to paragraph (5) thereof) of an
Employer, as long as the Company (or a related entity) is a corporation, any
stock of which is publicly traded on an established securities market or
otherwise.

     Section 2.20 Termination of Employment means a separation of service as
defined in the AJCA Guidance issued under Code Section 409A.”

Section 7

     Section 3.1(a) of the Plan is hereby amended in its entirety to the end
thereof to read as follows:

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     “(a) Amount of Excess 401(k) Benefits. Each Participant may, within 30
days after the Plan becomes effective as to him and on or prior to each
December 31st thereafter, by completing an approved deferral election form,
direct his Employer to reduce his Compensation for the balance of the Plan Year
in which the Plan becomes effective as to him (but only with respect to
Compensation payable for periods of service commencing after the Participant so
directs) or for the Plan Year following any such December 31, respectively, by
an amount equal to the difference between (i) a specified percentage, in 1%
increments, with a maximum of 25%, of his Compensation for the Plan Year, and
(ii) the maximum Before-Tax Contributions actually permitted to be contributed
for him to the Savings Plan for such Plan Year by reason of the application of
the limitations under Sections 402(g), 401(a)(17), 401(k)(3), 414(v) and 415 of
the Code. All amounts deferred under this Section shall be referred to herein
collectively as the “Excess 401(k) Benefits.” Notwithstanding the foregoing, a
Participant’s direction to reduce a Bonus earned during a particular Plan Year
shall be made no later than December 31st of the Plan Year preceding the Plan
Year in which the Bonus commences to be earned (or, in the case of the first
year in which a Participant becomes eligible to participate in the Plan, within
30 days after the Plan becomes effective as to him) and, as a result, Bonuses
that are paid in 2005 shall not be taken into account for purposes of
calculating Excess 401(k) Benefits hereunder.”

Section 8

     Section 3.1(c) of the Plan is hereby amended by adding the following new
sentences to the end thereof, to read as follows:

     “Notwithstanding the foregoing, with respect to amounts that are allocated
to a Participant’s Post-2004 Excess 401(k) Sub-Account, (i) the Participant may
elect to receive a distribution on the date on which he incurs a Termination of
Employment or the date he attains a specified age (or the earlier of such
dates) and (ii) with respect to a Key Employee, a distribution on account of
Termination of Employment may not be made before the date which is six months
after the date of the Key Employee’s Termination of Employment (or, if earlier,
the date of death), to the extent that Code Section 409A(a)(2)(B)(i) is
applicable.”

Section 9

     Section 3.1(d) of the Plan is hereby amended by adding the following new
sentence to the end thereof, to read as follows:

     “Notwithstanding the foregoing, all Participants must make a deferral
election by December 31, 2004 in order to participate in the Plan for the 2005
Plan Year.”

Section 10

     Section 3.1(e)(ii) of the Plan is hereby amended by adding the following
clause to the end thereof, to read as follows:

     “;provided, however, that the deferral of Excess 401(k) Benefits shall
automatically resume at the end of such suspension period.”

Section 11

     Section 3.1(e) of the Plan is hereby amended by adding the following new
clause (iv) to the end thereof, to read as follows:

     “(iv) The foregoing provisions shall apply only to the extent not
prohibited by Code Section 409A.”

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Section 12

     Section 3.3 of the Plan is hereby amended by adding the following new
Subsection (e) to the end thereof, to read as follows:

     “(e) No additional LTIP Deferral Benefits shall be accepted under the
Plan.”

Section 13

     Section 3.4 of the Plan is hereby amended by adding the following new
sentence to the end thereof, to read as follows:

     “Participants shall have the ability to elect the payment date for the
amounts allocated to their Post-2004 Excess Profit Sharing Sub-Account in
accordance with the rules described in Section 3.1(c) hereof.”

Section 14

     Section 3.5 of the Plan is hereby amended by adding the following new
Subsection (g) to the end thereof, to read as follows:

     “(g) The Employers shall make the above-described credits and debits to
the Participant’s Grandfathered Sub-Accounts or the Post-2004 Sub-Accounts, as
applicable, in accordance with Code Section 409A.”

Section 15

     Section 4.4(a) of the Plan is hereby amended in its entirety to read as
follows:

     “(a) To the extent not prohibited by Code Section 409A, the Board of
Directors of the Company (or the Compensation Committee of the Board of
Directors of the Company (the “Compensation Committee”) or the NACCO
Industries, Inc. Benefits Committee (the “Benefits Committee”) may change (but
not suspend) the earnings rate credited on Accounts hereunder at any time upon
at least 30 days advance notice to Participants.”

Section 16

     Section 6.1(a) of the Plan is hereby amended in its entirety to read as
follows:

     “(a) Time of Payment. Excess 401(k) and Matching Benefits, VAP Deferral
Benefits and Post-2004 Excess Profit Sharing Benefits shall be paid (or
commence to be paid) no later than the 30th day after the date specified in the
election form applicable to such Benefits. Amounts allocated to a
Participant’s Pre-2005 Excess Profit Sharing Sub-Account shall be paid at the
same time that the Profit Sharing Contributions under the Savings Plan commence
to be paid to the Participant.”

Section 17

     Section 6.1(b) of the Plan is hereby amended by adding the following
sentences to the end thereof, to read as follows:

     “The foregoing provisions shall not apply to a Participant’s Post-2004
Excess 401(k) Sub-Account. The Participant shall elect a form of payment for
his Post-2004 Excess 401(k) Sub-Account prior to December 31, 2004 (or when the
Plan first becomes applicable to him, if later). He may elect to receive such
Sub-Account in the form of a lump sum payment or in the form of annual
installment payments (for 10 or fewer years), with the installment payments (if
any) being calculated in accordance with the rules specified above. If the
Participant does not make a timely election regarding the form of payment, his
Post-2004 Excess 401(k) Sub-Account (and

 5

 

the related Post-2004 Excess Matching
Sub-Account) shall be distributed in the form of a single lump sum payment.
Once made, the election (or deemed election) of a form of payment shall be
irrevocable except as specified in the following sentences. Notwithstanding
the foregoing, a Participant may change his form of payment election (or deemed
election) for his Post-2004 Excess 401(k) Sub-Account by filing a subsequent
notice in writing, signed by the Participant and filed with the Plan
Administrator. However, unless otherwise permitted in accordance with Code
Section 409A, such election will not be effective unless (A) it is made not
less than twelve months prior to the date that distribution would have been
made absent such election, (B) the first payment under such election will be
made no less than five years from the date payment would have been made absent
such election (excluding distributions made on account of the death of the
Participant), (C) such election will not take effect until at least twelve
months after the date on which the election is made and (D) the election does
not accelerate the form of payment.”

Section 18

     The second sentence of Section 6.1(d) of the Plan is hereby amended in its
entirety to read as follows:

     “Payments made on account of an Unforeseeable Emergency shall be permitted
only to the extent the amount does not exceed the amount reasonably necessary
to satisfy the emergency need (plus an amount necessary to pay taxes reasonably
anticipated as a result of the distribution) and may not be made to the extent
such Unforeseeable Emergency is or may be relieved through reimbursement or
compensation by insurance or otherwise or by liquidation of the Participant’s
assets (to the extent such liquidation would not itself cause severe financial
hardship).”

Section 19

     Section 6.1(e)(i) of the Plan is hereby amended in its entirety to read as
follows:

     “(i) The provisions of this Subsection shall apply notwithstanding any
other provision of the Plan to the contrary but shall only apply to the amounts
that are allocated to the Participant’s Grandfathered Sub-Accounts.”

Section 20

     Section 6.1(e)(iv) of the Plan is hereby amended by adding the following
new sentence to the end thereof, to read as follows:

     “Such forfeitures shall inure to the benefit of the Employers and shall be
used to pay Excess Retirement Benefits under the Plan and/or to pay the
administrative expenses of the Plan.”

Section 21

     The last sentence of Section 6.1(f) of the Plan is hereby amended by
deleting the phrase “The Nominating, Organization and Compensation Committee of
the Board of Directors” and replacing it with the phrase “The Compensation
Committee” therein.

Section 22

     Section 6.1 of the Plan is hereby amended by adding the following new
Subsection (g) to the end thereof, to read as follows:

     “(g) Each of the foregoing provisions of this Section shall apply only to
the extent permitted by Code Section 409A.”

 6

 

Section 23

     Section 7.2 of the Plan is hereby amended by adding the following new
Subsection (d) to the end thereof, to read as follows:

     “(d) Notwithstanding the foregoing, distributions to Beneficiaries of
amounts that are allocated to Participants’ Post-2004 Sub-Accounts shall be
made in a manner that satisfies the requirements of Code Section 409A.”

Section 24

     Section 9.3 of the Plan is hereby amended in its entirety to read as
follows:

     “SECTION 9.3. Claims and Appeals Procedures.

     (a) The Plan Administrator shall determine the rights of any person to any
Excess Retirement Benefits hereunder. Any person who believes that he has not
received the Excess Retirement Benefits to which he is entitled under the Plan
must file a claim in writing with the Plan Administrator specifying the basis
for his claim and the facts upon which he relies in making such a claim. Such
a claim must be signed by the claimant or his duly authorized representative
(the “Claimant”).

     (b) Whenever the Plan Administrator denies (in whole or in part) a claim
for benefits under the Plan, the Plan Administrator shall transmit a written
notice of such decision to the Claimant, no later than 90 days after the
receipt of a claim (plus an additional period of 90 days if required for
processing, provided that notice of the extension of time is given to the
claimant within the first 90 day period). Such notice shall be written in a
manner calculated to be understood by the Claimant and shall state (i) the
specific reasons for the denial; (ii) specific reference to pertinent Plan
provisions on which the denial is based; (iii) a description of any additional
material or information necessary for the Claimant to perfect the claim and an
explanation of why such material or information is necessary; and (iv) an
explanation of the Plan’s claim review procedure and the time limits applicable
thereto (including a statement of the
Claimant’s right to bring a civil action under Section 502(a) of ERISA
following an adverse benefit determination on review).

     (c) Within 60 days after receipt of denial of a claim, the Claimant must
file with the Plan Administrator a written request for a review of such claim.
If such an appeal is not filed within such 60-day period, the Claimant shall be
deemed to have acquiesced in the original decision of the Plan Administrator on
his claim. If such an appeal is so filed within such 60 day period, a named
fiduciary designated by the Plan Administrator shall conduct a full and fair
review of such claim. During such review, the Claimant shall be given the
opportunity to review documents that are pertinent to his claim and to submit
issues and comments in writing. For this purpose, the named fiduciary shall
have the same power to interpret the Plan and make findings of fact thereunder
as is given to the Plan Administrator under Section 9.1 above. The named
fiduciary shall mail or deliver to the Claimant a written decision on the
matter based on the facts and the pertinent provisions of the Plan within 60
days after the receipt of the request for review (unless special circumstances
require an extension of up to 60 additional days, in which case written notice
of such extension shall be given to the Claimant prior to the commencement of
such extension). Such decision (i) shall be written in a manner calculated to
be understood by the Claimant, (ii) shall state the specific reasons for the
decision and the specific Plan provisions on which the decision was based and
(iii) shall, to the extent permitted by applicable law, be final and binding on
all interested persons. In addition, the notice of adverse determination shall
also include statements that the Claimant is entitled to receive, upon request
and free of charge, reasonable access to, and copies of all documents, records
and other information relevant to the Claimant’s claim for benefits and a
statement of the Claimant’s right to bring a civil action under Section 502(a)
of ERISA.”

 7

 

Section 25

     The first sentence of Section 9.5 of the Plan is hereby amended by
deleting the phrase “The NACCO Industries, Inc. Benefits Committee” and
replacing it with the phrase “The Company (with the approval or ratification of
the Benefits Committee)” therein

Section 26

     The second sentence of Section 9.5 of the Plan is hereby amended by
deleting the phrase “such Committee” and replacing it with the phrase “the
Benefits Committee” therein.

Section 27

     Section 9.6 of the Plan is hereby amended in its entirety to read as
follows:

     “SECTION 9.6. Termination.

     (a) The Board of Directors of the Company (or the Compensation Committee),
in its sole discretion, may terminate this Plan at any time and for any reason
whatsoever, except that, subject to Subsection (b) hereof, (i) no such
termination may adversely affect any Participant’s Excess Retirement Benefit as
of the date of such termination, and (ii) no such termination may suspend the
crediting of earnings on the balance of a Participant’s Account, until the
entire balance of such Account has been distributed, in either case, without
the prior written consent of the affected Participant. Any such termination
shall be expressed in the form of a written instrument executed by an officer
of the Company on the order of the Board (or Compensation Committee, as
applicable). Subject to the foregoing provisions of this Subsection, such
termination shall become effective as of the date specified in such instrument
or, if no such date is specified, on the date of its execution. Written notice
of any termination shall be given to the Participants as soon as practicable
after the instrument is executed.

     (b) Notwithstanding anything in the Plan to the contrary, to the extent
permitted under Code Section 409A, in the event of a termination of the Plan,
the Company, in its sole and absolute discretion (but with the consent of the
Benefits Committee or the Compensation Committee), shall have the right to
change the time and form of distribution of Participants’ Excess Retirement
Benefits, including requiring that all amounts credited to Participant’s
Accounts hereunder be immediately distributed in the form of a lump sum
payment.

     (c) Any Employer (other than the Company) that adopts the Plan may elect
to withdraw from the Plan and such withdrawal shall constitute a termination of
the Plan as to such Employer; provided, however, that such terminating Employer
shall continue to be an Employer for the purposes hereof as to Participants or
Beneficiaries to whom it owes obligations hereunder. Such withdrawal and
termination shall be expressed in an instrument executed by the terminating
Employer on authority of its Board of Directors (or the applicable Committee
thereof) and filed with the Company, and shall become effective as of the date
designated in such instrument or, if no such date is specified, on the date of
its execution. Notwithstanding any other provision of the Plan, if an Employer
(other than the Company) ceases to be a member of the Controlled Group, to the
extent permitted by Code Section 409A, the Plan shall automatically terminate
with respect to such Employer and all amounts credited to the Accounts of
Employees of such Employer shall be immediately payable in the form of a lump
sum payment.”

Section 28

     A new Section 9.7 is hereby added to the end of the Plan, to read as
follows:

 8

 

     “Section 9.7 AJCA. Notwithstanding any provision of the Plan to the
contrary, (a) the Company reserves the right to amend the Plan in any respect,
without the consent of any person, in order to comply with Code Section 409A
and (b) the provisions of Article IX of the Plan shall apply only to the extent
permitted by Code Section 409A.”

     EXECUTED this 28th day of December, 2004.

	 	 	 	 	 	 	 	 	 
	 	 	THE NORTH AMERICAN COAL CORPORATION
	 
	 	 	 	 	 	 	 	 
	

	 	 	 	By:	 	 /s/ Charles A. Bittenbender	 	 
	

	 	 	 	 	 	
 	 	 
	

	 	 	 	 	 	Title: Assistant Secretary	 	 

 9

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