As filed with the Securities and Exchange Commission on November 7, 1997
Registration No. 333 -
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
ADVENT SOFTWARE, INC.
(Exact name of Registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or
organization)
94-2901952
(I.R.S. Employer Identification Number)
301 Brannan Street
San Francisco, California 94107
(Address, including zip code, of Registrant's principal executive offices)
Advent Software, Inc.
Profit Sharing and Employee Savings Plan
(Full title of the plan)
Stephanie G. DiMarco
Chief Executive Officer
ADVENT SOFTWARE, INC.
301 Brannan Street
San Francisco, California 94107
(415) 543-7696
(Name, address, and telephone number, including area code, of agent for service)
Copies to:
Mark A. Bertelsen, Esq.
Robert Tarkoff, Esq.
Wilson Sonsini Goodrich & Rosati
Professional Corporation
650 Page Mill Road
Palo Alto, California 94304-1050
(650) 493-9300
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share Price Fee
- ---------- ---------- --------- ----------- ------------
Common Stock,
$.01 par value:
Advent Software, Inc.
Profit Sharing an
Employee Savings Plan 50,000 $ 26.0625 $ 1,303,125 $ 394.89
Interest in the Advent
Software, Inc. (2) (2) (2) (2)
Profit Sharing and
Employee Savings Plan
================================================================================
(1) Estimated in accordance with Rule 457(h) of the Securities Act of 1933, as
amended, solely for the purpose of computing the amount of the registration
fee based on the prices of the Company's Common Stock as reported on the
Nasdaq National Market on November 5, 1997.
(2) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, as
amended, this Registration Statement also covers an indeterminate amount of
interests to be offered or sold pursuant to the Advent Software, Inc.
Profit Sharing and Employee Savings Plan.
<PAGE>
ADVENT SOFTWARE, INC.
REGISTRATION STATEMENT ON FORM S-8
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
Advent Software, Inc. (the "Registrant") and the Advent Software, Inc.
Profit Sharing and Employee Savings Plan (the "Plan") hereby incorporate by
reference into this Registration Statement the following documents and
information heretofore filed with the Securities and Exchange Commission (the
"Commission"):
1. The Registrant's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996, filed pursuant to Section 13(a) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act").
2. The Registrant's Quarterly Report on Form 10-Q for the fiscal quarter
ended March 31, 1997, filed pursuant to Section 13(a) of the Exchange Act.
3. The Registrant's Quarterly Report on Form 10-Q for the fiscal quarter
ended June 30, 1997, filed pursuant to Section 13(a) of the Exchange Act.
4. The description of the Registrant's Common Stock contained in the
Registrant's Registration Statement on Form 8-A dated October 10, 1995, filed
pursuant to Section 12(g) of the Exchange Act, which was declared effective by
the Commission on November 15, 1995, including any amendment or report filed for
the purpose of updating such description.
5. The information contained in the Registrant's Registration Statement on
Form S-8 (file no. 333-28725) filed on or about June 6, 1997.
6. The Plan's Annual Report on Form 11-K for the fiscal year ended December
31, 1996, filed with the Commission on or about November 7, 1997.
All documents filed by the Registrant pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act after the date hereof, and prior to the filing of
a post-effective amendment indicating that all securities offered have been sold
or deregistering all securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be part hereof from the date of filing
such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Delaware law authorizes corporations to eliminate the personal
liability of directors to corporations and their stockholders for monetary
damages for breach or alleged breach of the directors' "duty of care." While the
relevant statute does not change directors' duty of care, it enables
corporations to limit available relief to equitable remedies such as injunction
or rescission. The statute has no effect on directors' duty of loyalty, acts or
omissions not in good faith or involving intentional misconduct or knowing
violations of law, illegal payment of dividends and approval of any transaction
from which a director derives an improper personal benefit. The Company has
adopted provisions in its Certificate of Incorporation which eliminate the
personal liability of its directors to the Company and its stockholders for
monetary damages for breach or alleged breach of their duty of care. The Bylaws
of the Company provide for indemnification of its directors, officers, employees
and agents to the full extent permitted by the General Corporation Law of the
State of Delaware, the Company's state of incorporation, including those
circumstances in which indemnification would otherwise be discretionary under
Delaware Law. Section 145 of the General Corporation Law of the State of
Delaware provides for indemnification in terms sufficiently broad to indemnify
such individuals, under
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<PAGE>
certain circumstances for liabilities (including reimbursement of expenses
incurred) arising under the Securities Act of 1933, as amended.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
Exhibit
Number Description
- ------ -----------
4.1 Advent Software Inc., Profit Sharing and Employee Savings Plan.
23.1 Consent of Coopers & Lybrand L.L.P., Independent Accountants.
23.2 Consent of Mohler, Nixon & Williams, Accountancy Corporation.
23.3 Consent of Counsel.
24.1 Power of Attorney (see page II-7).
99 Internal Revenue Service Determination Letter,
dated December 1, 1993.
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<PAGE>
ITEM 9. UNDERTAKINGS.
(a) The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended;
(ii) to reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement; and
(iii) to include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement.
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the registration statement is on Form S-3 or Form S-8, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the Registrant
pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, as amended, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) Filing incorporating subsequent exchange act documents by reference.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, as amended, each
filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of
the Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933, as amended, may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or otherwise,
the Registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and, is therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the Registrant will, unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by final adjudication of such issue.
(d) The Registrant undertakes to submit or has submitted the Advent
Software, Inc. Profit Sharing and Employee Savings Plan (the "Plan") and any
amendments thereto to the Internal Revenue Service ("IRS") in a timely manner
and has made or will make all changes required by the IRS in order to qualify
the Plan.
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<PAGE>
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, as amended, the Registrant certifies that it has reasonable grounds to
believe that it meets all of the requirements for filing on Form S-8 and has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of San Francisco, State of
California, on this 7th day of November, 1997.
ADVENT SOFTWARE, INC.
By: /S/ IRV H. LICHTENWALD
-------------------------
Irv H. Lichtenwald
Title: Senior Vice President,
Chief Financial Officer and Secretary
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<PAGE>
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Act of 1933,
as amended, the trustee of the Advent Software, Inc. Profit Sharing and Employee
Savings Plan has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of
San Francisco, State of California, on November 7, 1997.
ADVENT SOFTWARE, INC. PROFIT
SHARING AND EMPLOYEE SAVINGS PLAN
By: /S/ IRV H. LICHTENWALD
----------------------
Irv H. Lichtenwald
Title: on behalf of the Plan Administrator
of the Advent Software, Inc. Profit
Sharing and Employee Savings Plan
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<PAGE>
POWER OF ATTORNEY
KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Stephanie G. DiMarco and Irv H.
Lichtenwald, jointly and severally, as his or her attorney-in-fact and agent,
each with full power of substitution and resubstitution, for him or her and in
his or her name, place and stead, in any and all capacities, to sign any and all
amendments (including post-effective amendments) to this Registration Statement,
and to file the same, with exhibits thereto and other documents in connection
therewith, with the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, and each of them, full power and authority to do
and perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully and to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their or his substitute, may
lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
Signatures Title Date
- ---------- ----- ----
/S/ STEPHANIE G. DIMARCO Chairman of the Board and November 7, 1997
- ----------------------- Chief Executive Officer
Stephanie G. DiMarco (Principal Executive Officer)
/S/ IRV H. LICHTENWALD Senior Vice President of Finance November 7, 1997
- ----------------------- and Chief Financial Officer
Irv H. Lichtenwald (Principal Financial and
Accounting Officer)
/S/ FRANK H. ROBINSON Director November 7, 1997
- -----------------------
Frank H. Robinson
/S/ WENDELL G. VAN AUKEN Director November 7, 1997
- -----------------------
Wendell G. Van Auken
/S/ WILLIAM ZUENDT Director November 7, 1997
- -----------------------
William Zuendt
-7-
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Description
- ------ -----------
4.1 Advent Software Inc., Profit Sharing and Employee Savings Plan.
23.1 Consent of Coopers & Lybrand L.L.P., Independent Accountants.
23.2 Consent of Mohler, Nixon & Williams, Accountancy Corporation.
23.3 Consent of Counsel.
24.1 Power of Attorney (see page II-7).
99 Internal Revenue Service Determination Letter, dated December 1, 1993.
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<PAGE>
WRITTEN CONSENT
OF THE BOARD OF DIRECTORS OF
ADVENT SOFTWARE, INC.
A Delaware Corporation
AND
AMENDMENT NUMBER 3 TO THE ADVENT SOFTWARE, INC
PROFIT SHARING AND EMPLOYEE SAVINGS PLAN
(the "Plan")
The undersigned being all of the directors of the above Delaware corporation,
hereby authorize the following actions and resolutions which might have been
adopted at a meeting of the Board of Directors. WHEREAS, Advent Software, Inc.
adopted the Advent Software, Inc. Profit Sharing and Employee Savings Plan with
an effective date of January 1, 1988, as amended and restated effective January
1, 1993.
WHEREAS, Advent Software, Inc, after full and deliberate consideration, the
corporation believe it to be in the best interest of the corporation to
amend the Advent Software, Inc. Profit Sharing and Employee Savings Plan.
WHEREAS, Advent Software, Inc. desires under the terms of Article II,
Section 2.3(a); Article VII, Section 7.9 and Article VIII, Section 8.1; of
the Plan and Trust Agreement to remove Charles Schwab Trust Company as
Trustee of the Plan and Trust Agreement and to appoint Smith Barney
Corporate Trust Company as the Trustee of the Plan and Trust Agreement.
NOW THEREFORE, IT IS HEREBY,
RESOLVED, that page one previously amended in Amendment Number 2 of the
Advent Software, Inc. Profit Sharing and Employee Savings Plan is hereby
amended in its entirety effective July 18, 1996 and such amendment
supersedes all inconsistent provisions of the Plan and Trust Agreement, and
it is further
RESOLVED FURTHER, that the Smith Barney Corporate Trust Company be
appointed as successor Trustee to serve under the Plan and Trust Agreement
to have all the powers, duties and responsibilities of a trustee
thereunder, subject to its acceptance of such trusteeship, and it is
further
<PAGE>
RESOLVED, that the proper officers of this corporation be, and they hereby
are, authorized and directed to notify the Plan Administrator, participants
and beneficiaries, investment managers, and all other appropriate parties
of the appointment of the Smith Barney Corporate Trust Company as successor
Trustee, as aforesaid, to execute on behalf of this corporation such
instruments (including without limitation, a formal instrument of
appointment and acceptance, and to perform such further acts as it is, in
its direction, deems necessary or desirable to effectuate the intent of the
foregoing resolution, and it is further
RESOLVED, that a copy of this Action and Amendment be made a part of the
Plan, effective as of the dates stated below.
Adoption
Date: July 18, 1996 /s/ STEPHANIE G. DIMARCO
------------------------
Director
Effective Date
of Amendment: July 18, 1996
------------------------
Director
<PAGE>
AMENDMENT #2
WHEREAS, Advent Software, Inc. adopted the Advent Software, Inc. Profit
Sharing and Employee Savings Plan with an effective date of January 1,
1988, as amended and restated effective January 1, 1993.
WHEREAS, Advent Software, Inc. desires to amend such Profit Sharing and
Employee Savings Plan under the terms of Article II, section 2.3(a);
Article VII section 7.9; and Article VIII section 8.1; of the Plan and
Trust Agreement to remove Stephanie DiMarco as Trustee of the Plan and
Trust Agreement and to appoint The Charles Schwab Trust Company as Trustee
of the Plan and Trust Agreement.
NOW, THEREFORE, page 1 of the Advent Software, Inc. Profit Sharing and
Employee Savings Plan is hereby amended in its entirety effective April 15,
1994, and such amendment supersedes all inconsistent provisions of the Plan
and Trust Agreement.
IN WITNESS WHEREOF, the Employer and Trustee, respectively, have signed by
their duly authorized officers on the date and year written below.
ADVENT SOFTWARE, INC.
By /s/ STEPHANIE G. DIMARCO 4/15/94
------------------------ -------
Date
By /s/ THE CHARLES SCHWAB TRUST COMPANY, TRUSTEE
----------------------------------------------
<PAGE>
MODEL AMENDMENT #1
ADVENT SOFTWARE, INC.
PROFIT SHARING AND EMPLOYEE SAVINGS PLAN
BY THIS AGREEMENT, Advent Software, Inc. Profit Sharing and Employee
Savings Plan, (herein referred to as the "Plan") is hereby amended as follows,
effective as of January 1, 1993:
1. Section 1.8, Section 1.24 and the calculation of "415 Compensation" for the
purpose of the minimum allocations required for Top Heavy Plan Years, are
amended by the addition of the following paragraphs:
In addition to other applicable limitations set forth in the Plan, and
notwithstanding any other provision of the Plan to the contrary, for Plan Years
beginning on or after January 1, 1994, the annual Compensation of each Employee
taken into account under the Plan shall not exceed the OBRA '93 annual
compensation limit. The OBRA '93 annual compensation limit is $150,000, as
adjusted by the Commissioner for increases in the cost of living in accordance
with Code Section 401(a)(17)(B).The cost of living adjustment in effect for a
calendar year applies to any period, not exceeding 12 months, over which
Compensation is determined (determination period) beginning in such calendar
year. If a determination period consists of fewer than 12 months, the OBRA '93
annual compensation limit will be multiplied by a fraction, the numerator of
which is the number of months in the determination period, and the denominator
of which is 12.
For Plan Years beginning on or after January 1, 1994, any reference in this
Plan to the limitation under Code Section 401(a)(17) shall mean the OBRA '93
annual compensation limit set forth in this provision.
If Compensation for any prior determination period is taken into account in
determining an Employee's benefits accruing in the current Plan Year, the
Compensation for that prior determination period is subject to the OBRA '93
annual compensation limit in effect for that prior determination period. For
this purpose, for determination periods beginning before the first day of the
first Plan Year beginning on or after January 1, 1994, the OBRA '93 annual
compensation limit is $150,000.
2. Section 1.12 is amended in its entirety as follows:
"Elective Contribution" means the Employer's contributions to the Plan of
Deferred Compensation excluding any such amounts distributed as excess "annual
additions" pursuant to Section 4.8(a). In addition, the Employer's matching
contribution made pursuant to Section 4.1(b) and any Employer Qualified
Non-Elective Contribution made pursuant to Section 4.1(c) and Section 4.6 shall
be considered an Elective Contribution for purposes of the Plan. Any such
contributions deemed to be Elective Contributions shall be subject to the
requirements of Sections 4.2(b) and 4.2(c) and shall further be required to
satisfy the discrimination requirements of Regulations 1.401(k)-l(b)(5), the
provisions of which are specifically incorporated herein by reference.
<PAGE>
3. Section 1.29 is amended by the addition of the following paragraph:
Income during the "gap period' shall not be taken into account.
4. Section 6.5(b) is amended by the addition of the following paragraph:
If a distribution is one to which Code Sections 401 (a)(11) and 417 do not
apply, such distribution may commence less than 30 days after the notice
required under Regulation 1.411(a)-11(c) is given, provided that: (1) the
Administrator clearly informs the Participant that the Participant has a right
to a period of at least 30 days after receiving the notice to consider the
decision of whether or not to elect a distribution (and, if applicable, a
particular distribution option), and (2) the Participant, after receiving the
notice, affirmatively elects a distribution.
5. Article VII is amended by the addition of the following section after
Section 7.4:
7.11 DIRECT ROLLOVER
(a) This Section applies to distributions made on or after January 1,
1993. Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee's election under this Section, a distributee
may elect, at the time and in the manner prescribed by the Plan
Administrator, to have any portion of an eligible rollover distribution
paid directly to an eligible retirement plan specified by the distributee
in a direct rollover.
(b) For the purposes of this Section the following definitions shall
apply:
(1)An eligible rollover distribution is any distribution of all
or any portion of the balance to the credit of the distributee, except
that an eligible rollover distribution does not include: any
distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or
life expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under Code
Section 401(a)(9);.and the portion of any distribution that is not
includible in gross income (determined without regard to the exclusion
for net unrealized appreciation with respect to employer securities).
(2)An eligible retirement plan is an individual retirement
account described in Code Section 408(a), an individual retirement
annuity described in Code Section 408(b), an annuity plan described in
Code Section 403(a), or a qualified trust described in Code Section
401(a), that accepts the distributee's eligible rollover distribution:
However, in the case of an eligible rollover distribution to the
surviving spouse, an eligible retirement plan is an individual
retirement account or individual retirement annuity.
<PAGE>
(3) A distributee includes an Employee or former Employee. In
addition, the Employee's or former Employee's surviving spouse and the
Employees or former Employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as defined
in Code Section 414(p),are distributees with regard to the interest of
the spouse or former spouse.
(4) A direct rollover is a payment by the Plan to the eligible
retirement plan specified by the distributee.
11. Section 8.1 is amended by the addition of the following sentence:
Any amendment to the Plan shall be adopted by formal action of the Employer's
board of directors and executed by an officer authorized to act on behalf of the
Employer.
12. Section 8.2 is amended by the addition of the following sentence:
Termination of the Plan shall be resolved by formal action of the Employer's
board of directors and the resolution executed by an officer authorized to act
on behalf of the Employer.
IN WITNESS WHEREOF, this Amendment has been executed this First day of May,
1994.
ADVENT SOFTWARE, INC.
By: /s/ STEPHANIE G. DIMARCO
----------------------------
EMPLOYER
<PAGE>
ADVENT SOFTWARE, INC.
PROFIT SHARING AND EMPLOYEE SAVINGS PLAN
<PAGE>
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
ARTICLE II
TOP HEAVY AND ADMINISTRATION
2.1 TOP HEAVY PLAN REQUIREMENTS 19
2.2 DETERMINATION OF TOP HEAVY STATUS 19
2.3 POWERS AND RESPONSIBILITIES OF THE EMPLOYER 23
2.4 DESIGNATION OF ADMINISTRATIVE AUTHORITY 24
2.5 ALLOCATION AND DELEGATION OF RESPONSIBILITIES 24
2.6 POWERS AND DUTIES OF THE ADMINISTRATOR 24
2.7 RECORDS AND REPORTS 26
2.8 APPOINTMENT OF ADVISERS 26
2.9 INFORMATION FROM EMPLOYER 26
2.10 PAYMENT OF EXPENSES 27
2.11 MAJORITY ACTIONS 27
2.12 CLAIMS PROCEDURE 27
2.13 CLAIMS REVIEW PROCEDURE 27
ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY 28
3.2 APPLICATION FOR PARTICIPATION 28
3.3 EFFECTIVE DATE OF PARTICIPATION 29
3.4 DETERMINATION OF ELIGIBILITY 29
<PAGE>
3.5 TERMINATION OF ELIGIBILITY 29
3.6 OMISSION OF ELIGIBLE EMPLOYEE 30
3.7 INCLUSION OF INELIGIBLE EMPLOYEE 30
3.8 ELECTION NOT TO PARTICIPATE 30
ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION 31
4.2 PARTICIPANT'S SALARY REDUCTION ELECTION 32
4.3 TIME OF PAYMENT OF EMPLOYER'S CONTRIBUTION 36
4.4 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS 37
4.5 ACTUAL DEFERRAL PERCENTAGE TESTS 42
4.6 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS 45
4.7 MAXIMUM ANNUAL ADDITIONS 47
4.8 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS 52
4.9 TRANSFERS FROM QUALIFIED PLANS 53
4.10 DIRECTED INVESTMENT ACCOUNT 56
ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND 56
5.2 METHOD OF VALUATION 57
ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT 57
6.2 DETERMINATION OF BENEFITS UPON DEATH 57
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY 59
6.4 DETERMINATION OF BENEFITS UPON TERMINATION 59
6.5 DISTRIBUTION OF BENEFITS 63
6.6 DISTRIBUTION OF BENEFITS UPON DEATH 66
6.7 TIME OF SEGREGATION OR DISTRIBUTION 68
6.8 DISTRIBUTION FOR MINOR BENEFICIARY 68
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN 68
6.10 ADVANCE DISTRIBUTION FOR HARDSHIP 69
6.11 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION 71
ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE 71
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE 72
7.3 OTHER POWERS OF THE TRUSTEE 72
7.4 LOANS TO PARTICIPANTS 75
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS 77
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES 77
7.7 ANNUAL REPORT OF THE TRUSTEE 77
7.8 AUDIT 78
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE 79
7.10 TRANSFER OF INTEREST 80
ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS
8.1 AMENDMENT 81
8.2 TERMINATION 82
<PAGE>
8.3 MERGER OR CONSOLIDATION 82
ARTICLE IX
MISCELLANEOUS
9.1 PARTICIPANT'S RIGHTS 83
9.2 ALIENATION 83
9.3 CONSTRUCTION OF PLAN 84
9.4 GENDER AND NUMBER 84
9.5 LEGAL ACTION 84
9.6 PROHIBITION AGAINST DIVERSION OF FUNDS 85
9.7 BONDING 85
9.8 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE 86
9.9 INSURER'S PROTECTIVE CLAUSE 86
9.10 RECEIPT AND RELEASE FOR PAYMENTS 86
9.11 ACTION BY THE EMPLOYER 86
9.12 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY 87
9.13 HEADINGS 87
9.14 APPROVAL BY INTERNAL REVENUE SERVICE 88
9.15 UNIFORMITY 88
<PAGE>
ADVENT SOFTWARE ' INC.
PROFIT SHARING AND EMPLOYEE SAVINGS PLAN
THIS AGREEMENT, hereby made and entered into this 19th day of January,
1993, by and between Advent Software, Inc. (herein referred to as the
"Employer") and Stephanie DiMarco (herein referred to as the "Trustee").
W I T N E S S E T H:
WHEREAS, the Employer heretofore established a Profit Sharing Plan and
Trust effective January 1, 1988, (hereinafter called the "Effective Date") known
as Advent Software, Inc. Profit Sharing and Employee Savings Plan (herein
referred to as the "Plan") in recognition of the contribution made to its
successful operation by its employees and for the exclusive benefit of its
eligible employees; and
WHEREAS, under the terms of the Plan, the Employer has the ability to amend
the Plan, provided the Trustee joins in such amendment if the provisions of the
Plan affecting the Trustee are amended;
NOW, THEREFORE, effective January 1, 1993, except as otherwise provided,
the Employer and the Trustee in accordance with the provisions of the Plan
pertaining to amendments thereof, hereby amend the Plan in its entirety and
restate the Plan to provide as follows:
ARTICLE I
DEFINITIONS
1.1 "Act" means the Employee Retirement Income Security Act of 1974, as it
may be amended from time to time.
1.2 "Administrator" means the person designated by the Employer pursuant to
Section 2.4 to administer the Plan on behalf of the Employer.
1.3 "Affiliated Employer" means any corporation which is a member of a
controlled group of corporations (as defined in Code Section 414(b)) which
includes the Employer; any trade or business (whether or not incorporated) which
is under common control (as defined in Code Section 414(c)) with the Employer;
any organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Code Section 414(m)) which includes the
Employer; and any other entity required to be aggregated with the Employer
pursuant to Regulations under Code Section 414(o).
1.4 "Aggregate Account" means, with respect to each Participant, the value
of all accounts maintained on behalf of a Participant, Whether attributable to
Employer or Employee contributions, subject to the provisions of Section 2.2.
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1.5 "Anniversary Date" means December 31st.
1.6 "Beneficiary" means the person to whom the share of a deceased
Participant's total account is payable, subject to the restrictions of Sections
6.2 and 6.6.
1.7 "Code" means the Internal Revenue Code of 1986, as amended or replaced
from time to time.
1.8 "Compensation" with respect to any Participant means such Participant's
wages, salaries, fees for professional services and other amounts received
(without regard to whether or not an amount is paid in cash) for personal
services actually rendered in the course of employment with the Employer
maintaining the Plan to the extent that the amounts are includible in gross
income (including, but not limited to, commissions paid salesmen, compensation
for services on the basis of a percentage of profits, commissions on insurance
premiums, tips, bonuses, fringe benefits, and reimbursements or other expense
allowances under a nonaccountable plan (as described in Regulation 1.62-2(c))
for a Plan Year.
Compensation shall exclude (a) (1) contributions made by the Employer to a
plan of deferred compensation to the extent that, the contributions are not
includible in the gross income of the Participant for the taxable year in which
contributed, (2) Employer contributions made on behalf of an Employee to a
simplified employee pension plan described in Code Section 408(k) to the extent
such contributions are excludable from the Employees's gross income, (3) any.
distributions from a plan of deferred compensation; (b) amounts realized from
the exercise of a non-qualified stock option, or when restricted stock (or
property) held by an Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture; (c) amounts realized from the sale,
exchange, or other disposition of stock acquired under a qualified stock option;
and (d) other amounts which receive special tax benefits, or contributions made
by the Employer (whether or not under a salary reduction agreement) towards the
purchase of any annuity contract described in Code Section 403 (b) (whether or
not the contributions are actually excludable from the gross income of the
Employee).
For purposes of this Section, the determination of Compensation shall be
made by:
(a) including amounts which are contributed by the Employer pursuant
to a salary reduction agreement and which are not includible in the gross
income of the Participant under Code Sections 125, 402(a)(8), 402(h),
403(b) or 457, and Employee contributions described in Code Section
414(h)(2) that are treated as Employer contributions.
For a Participant's initial year of participation, Compensation shall be
recognized for the entire Plan Year.
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Compensation in excess of $200,000 shall be disregarded. Such amount shall
be adjusted at the same time and in such manner as permitted under Code Section
415 (d), except that the dollar increase in effect on January 1 of any calendar
year shall be effective for the Plan Year beginning with or within such calendar
year and the first adjustment to the $200,000 limitation shall be effective on
January 1, 1990. For any short Plan Year the Compensation limit shall be an
amount equal to the Compensation limit for the calendar year in which the Plan
Year begins multiplied by the ratio obtained by dividing the number of full
months in the short Plan Year by twelve (12). In applying this limitation, the
family group of a Highly Compensated Participant who is subject to the Family
Member aggregation rules of Code Section 414(q)(6) because such Participant is
either a "five percent owner" of the Employer or one of the ten (10) Highly
Compensated Employees paid the greatest "415 Compensation" during the year,
shall be treated as a single Participant, except that for this purpose Family
Members shall include only the affected Participant's spouse and any lineal
descendants who have not attained age nineteen (19) before the close of the
year. If, as a result of the application of such rules the adjusted $200,000
limitation is exceeded, then the limitation shall be prorated among the affected
Family Members in proportion to each such Family Member's Compensation prior to
the application of this limitation, or the limitation shall be adjusted in
accordance with any other method permitted by Regulation.
If, as a result of such rules, the maximum "annual addition" limit of
Section 4.7.(a) would be exceeded for one or more of the affected Family
Members, the prorated Compensation of all affected Family Members shall be
adjusted to avoid or reduce any excess. The prorated Compensation of any
affected Family Member whose allocation would exceed the limit shall be adjusted
downward to the level needed to provide an allocation equal to such limit. The
prorated Compensation of affected Family Members not affected by such limit
shall then be adjusted upward on a pro rata basis not to exceed each such
affected Family Member's Compensation as determined prior to application of the
Family Member rule. The resulting allocation shall not exceed such individuals
maximum "annual addition" limit. If, after these adjustments, an "excess amount"
still results, such "excess amount" shall be disposed of in the manner described
in Section 4.8(a) pro rata among all affected Family Members.
If, in connection with the adoption of this amendment and restatement, the
definition of Compensation has been modified, then, for Plan Years prior to the
Plan Year which includes the adoption date of this amendment and restatement,
Compensation means compensation determined pursuant to the Plan then in effect.
For Plan Years beginning prior to January 1, 1989, the $200,000 limit
(without regard to Family Member aggregation) shall apply only for Top Heavy
Plan Years and shall not be adjusted.
1.9 "Contract" or "Policy" means any life insurance policy, retirement
income or annuity policy, or annuity contract (group or individual) issued
pursuant to the terms of the Plan.
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1.10 "Deferred Compensation" with respect to any Participant means the
amount of the Participant's total Compensation which has been contributed to the
Plan in accordance with the Participant's deferral election pursuant to Section
4.2 excluding any such amounts distributed as excess "annual additions" pursuant
to Section 4.8(a).
1.11 "Early Retirement Date". This Plan does not provide for a retirement
date prior to Normal Retirement Date.
1.12 "Elective Contribution" means the Employer's contributions to the Plan
of Deferred Compensation excluding any such amounts distributed as excess
"annual additions" pursuant to Section 4. 10 (a). In addition, the Employer's
matching contribution made pursuant to Section 4.1(b) and any Employer Qualified
Non-Elective Contribution made pursuant to Section 4.1(c) and Section 4.6 shall
be considered an Elective Contribution for purposes of the Plan. Any such
contributions deemed to be Elective Contributions shall be subject to the
requirements of Sections 4.2(b) and 4.2(c) and shall further be required to
satisfy the discrimination requirements of Regulation 1.401(k)-1(b)(5), the
provisions of which are specifically incorporated herein by reference.
1.13 "Eligible Employee" means any Employee.
Employees whose employment is governed by the terms of a collective
bargaining agreement between Employee representatives (within the meaning of
Code Section 7701(a) (46)) and the Employer under which retirement benefits were
the subject of good faith bargaining between the parties will not be eligible
to participate in this Plan unless such agreement expressly provides for
coverage in this Plan or two percent or less of the Employees of the Employer
who are covered pursuant to that agreement are professionals as defined in
Regulation 1.410(b)-9.
Employees of Affiliated Employers shall not be eligible to participate in
this Plan unless such Affiliated Employers have specifically adopted this Plan
in writing.
1.14 "Employee" means any person who is employed by the Employer or
Affiliated Employer, but excludes any person who is an independent contractor.
Employee shall include Leased Employees within the meaning of Code Sections 414
(n)(2) and 414(o)(2) unless such Leased Employees are covered by a plan
described in Code Section 414 (n)(5) and such Leased Employees do not constitute
more than 20% of the recipient's non-highly compensated work force.
1.15 "Employer" means Advent Software, Inc. and any successor which shall
maintain this Plan; and any predecessor which has maintained this Plan. The
Employer is a corporation, with principal offices in the State of California.
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1.16 "Excess Contributions" means, with respect to a Plan Year, the excess
of Elective Contributions made on behalf of Highly Compensated Participants for
the Plan Year over the maximum amount of such contributions permitted under
section 4.5(a). Excess contributions shall be treated as an "annual addition"
pursuant to Section 4.7(b).
1.17 "Excess Deferred Compensation" means, with respect to any taxable year
of a Participant, the excess of the aggregate amount of such Participant's
Deferred Compensation and the elective deferrals pursuant to Section 4.2 (f)
actually made on behalf of such Participant for such taxable year, over the
dollar limitation provided for in Code Section 402(g), which is incorporated
herein by reference. Excess Deferred Compensation shall be treated as an "annual
addition" pursuant to Section 4.7(b) when contributed to the Plan unless
distributed to the affected Participant not later than the first April 15th
following the close of the Participant's taxable year. Additionally, for
purposes of Sections 2.2 and 4.4(g), Excess Deferred Compensation shall continue
to be treated as Employer contributions even if distributed pursuant to Section
4.2(f). However, Excess Deferred Compensation of Non-Highly Compensated
Participants is not taken into account for purposes of Section 4.5(a) to the
extent such Excess Deferred Compensation occurs pursuant to Section 4.2(d).
1.18 "Family Member" means, with respect to an affected Participant, such
Participant's spouse, such Participant's lineal descendants and ascendants and
their spouses, all as described in Code Section 414(q)(6)(B).
1.19 "Fiduciary" means any person who (a) exercises any discretionary
authority or discretionary control respecting management of the Plan or
exercises any authority or control respecting management or disposition of its
assets, (b) renders investment advice for a fee or other compensation, direct or
indirect, with respect to any monies or other property of the Plan or has any
authority or responsibility to do so, or (c) has any discretionary authority or
discretionary responsibility in the administration of the Plan, including, but
not limited to, the Trustee, the Employer and its representative body, and the
Administrator.
1.20 "Fiscal Year" means the Employer's accounting year of 12 months
commencing on January lst of each year and ending the following December 31st.
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1.21 "Forfeiture" means that portion of a Participant's Account that is not
Vested, and occurs on the earlier of:
(a) the distribution of the entire Vested portion of a Participant's
Account, or
(b) the last day of the Plan Year in which the Participant incurs five
(5) consecutive 1-Year Breaks in Service.
Furthermore, for purposes of paragraph (a) above, in the case of a
Terminated Participant whose Vested benefit is zero, such Terminated Participant
shall be deemed to have received a distribution of his Vested benefit upon his
termination of employment. Restoration of such amounts shall occur pursuant to
Section 6.4 (f) (2). In addition, the term Forfeiture shall also include amounts
deemed to be Forfeitures pursuant to any other provision of this Plan.
1.22 "Former Participant" means a person who has been a Participant, but
who has ceased to be a Participant for any reason.
1.23 "415 Compensation" with respect to any Participant means such
Participant wages, salaries, fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash) for
personal services actually rendered in the course of employment with the
Employer maintaining the Plan to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid salesmen,
compensation for services on the basis of a percentage of profits, commissions
on insurance premiums, tips, bonuses, fringe benefits, and reimbursements or
other expense allowances under a nonaccountable plan (as described in Regulation
1.62-2(c)) for a Plan Year.
"415 Compensation" shall exclude (a)(1) contributions made by the Employer
to a plan of deferred compensation. to the extent that, the contributions are
not includible in the gross income of the Participant for the taxable year in
which contributed, (2) Employer contributions made on behalf of an Employee to a
simplified employee pension plan described in Code Section 408(k) to the extent
such contributions are excludable from the Employee's gross income, (3) any
distributions from a plan of deferred compensation; (b) amounts realized from
the exercise of a non-qualified stock option, or when restricted stock (or
property) held by an Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture; (c) amounts realized from the sale,
exchange or other disposition of stock acquired under a qualified stock option;
and (d) other amounts which receive special tax benefits, or contributions made
by the Employer (whether or not under a salary reduction agreement) towards the
purchase of any annuity contract described in Code Section 403(b) (whether or
not the contributions are actually excludable from the gross income of the
Employee).
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If, in connection with the adoption of this amendment and restatement, the
definition of "415 Compensation" has been modified, then, for Plan Years prior
to the Plan Year which includes the adoption date of this amendment and
restatement, "415 Compensation" means compensation determined pursuant to the
Plan then in effect.
1.24 "414(s) Compensation" with respect to any Participant means such
Participant's "415 Compensation" paid during a Plan Year. The amount of "414(s)
Compensation" with respect to any Participant shall include "414(s)
Compensation" for the entire twelve (12) month period ending on the last day of
such Plan Year.
For purposes of this Section, the determination of "414(s) Compensation"
shall be made by including amounts which are contributed by the Employer
pursuant to a salary reduction agreement and which are not includible in the
gross income of the Participant under Code Sections 125, 402(a)(8), 402(h),
403(b) or 457, and Employee contributions described in Code Section 414(h)(2)
that are treated as Employer contributions.
"414(s) Compensation" in excess of $200,000 shall be disregarded. Such
amount shall be adjusted at the same time and in such manner as permitted under
Code Section 415(d), except that the dollar increase in effect on January 1 of
any calendar year shall be effective for the Plan Year beginning with or within
such calendar year and the first adjustment to the $200,000 limitation shall be
effective on January 1, 1990. For any short Plan Year the "414(s) Compensation"
limit shall be an amount equal to the "414(s) Compensation" limit for the
calendar year in which the Plan Year begins multiplied by the ratio obtained by
dividing the number of full months in the short Plan Year by twelve (12). In
applying this limitation, the family group of a Highly Compensated Participant
who is subject to the Family Member aggregation rules of Code Section 414(q)(6)
because such Participant is either a "five percent owner" of the Employer or one
of the ten (10) Highly Compensated Employees paid the greatest "415
Compensation" during the year, shall be treated as a single Participant, except
that for this purpose Family Members shall include only the affected
Participant's spouse and any lineal descendants who have not attained age
nineteen (19) before the close of the year.
If, in connection with the adoption of this amendment and restatement, the
definition of "414(s) Compensation" has been modified, then, for Plan Years
prior to the Plan Year which includes the adoption date of this amendment and
restatement, "414(s) Compensation" means compensation determined pursuant to the
Plan then in effect.
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1.25 "Highly Compensated Employee" means an Employee described in Code
Section 414(q) and the Regulations thereunder, and generally means an Employee
who performed services for the Employer during the "determination year" and is
in one or more of the following groups:
(a) Employees who at any time during the "determination year" or
"look-back year" were "five percent owners" as defined in Section 1.31(c).
(b) Employees who received "415 Compensation" during the "look-back
year" from the Employer in excess of $75,000.
(c) Employees who received "415 Compensation" during the "look-back
year" from the Employer in excess of $50,000 and were in the Top Paid Group
of Employees for the Plan Year.
(d) Employees who during the "look-back year" were officers of the
Employer (as that term is defined within the meaning of the Regulations
under Code Section 416) and received "415 Compensation" during the
"look-back 'year" from the Employer greater than 50 percent of the limit in
effect under Code Section 415(b)(1)(A) for any such Plan Year. The number
of officers shall be limited to the lesser of (i) 50 employees; or (ii) the
greater of 3 employees or 10 percent of all employees. For the purpose of
determining the number of officers, Employees described in Section 1.54(a),
(b), (c) and (d) shall be excluded, but such Employees shall still be
considered for the purpose of identifying the particular Employees who are
officers. If the Employer does not have at least one officer whose annual
"415 Compensation" is in excess of 50 percent of the Code Section
415(b)(1)(A) limit, then the highest paid officer of the Employer will be
treated as a Highly Compensated Employee.
(e) Employees who are in the group consisting of the 100 Employees
paid the greatest "415 Compensation" during the "determination year" and
are also described in (b), (c) or (d) above when these paragraphs are
modified to substitute "determination year" for "look-back year".
The "look-back year" shall be the calendar year ending with or within the
Plan Year for which testing is being performed, and the "determination year" (if
applicable) shall be
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the period of time, if any, which extends beyond the "look-back year" and ends
on the last day of the Plan Year for which testing is being performed (the "lag
period"). If the "lag periods" is less than twelve months long, the dollar
threshold amounts specified in (b), (c) and (d) above shall be prorated based
upon the number of months in the "lag period".
For purposes of this Section, the determination of "415 Compensation" shall
be made by including amounts that would otherwise be excluded from a
Participant's gross income by reason of the application of Code Sections 125,
402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant
to a salary reduction agreement, by including amounts that would otherwise be
excluded from a Participant's gross income by reason of the application of Code
Section 403(b). Additionally, the dollar threshold amounts specified in (b) and
(c) above shall be adjusted at such time and in such manner as is provided in
Regulations. In the case of such an adjustment, the dollar limits which shall be
applied are those for the calendar year in which the "determination year" or
"look-back year" begins.
In determining who is a Highly Compensated Employee, Employees who are
non-resident aliens and who received no earned income (within the meaning of
Code Section 911(d)(2)) from the Employer constituting United States source
income within the meaning of Code Section 861(a)(3) shall not be treated as
Employees. Additionally, all Affiliated Employers shall be taken into account as
a single employer and Leased Employees within the meaning of Code Sections
414(n)(2) and 414(o)(2) shall be considered Employees unless such Leased
Employees are covered by a plan described in Code Section 414(n)(5) and are not
covered in any qualified plan maintained by the Employer. The exclusion of
Leased Employees for this purpose shall be applied on a uniform and consistent
basis for all of the Employer's retirement plans. Highly Compensated Former
Employees shall be treated as Highly Compensated Employees without regard to
whether they performed services during the "determination year".
1.26 "Highly Compensated Former Employee" means a former Employee who had a
separation year prior to the "determination year" and was a Highly Compensated
Employee in the year of separation from service or in any "determination year"
after attaining age 55. Notwithstanding the foregoing, an Employee who separated
from service prior to 1987 will be treated as a Highly Compensated Former
Employee only if during the separation year (or year preceding the separation
year) or any year after the Employee attains age 55 (or the last year ending
before the Employee's 55th birthday), the Employee either received "415
Compensation" in excess of $50,000 or was a "five percent owner".
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<PAGE>
For purposes of this section, "determination year", "415 Compensation" and "five
percent owner" shall be determined in accordance with Section 1.25. Highly
Compensated Former Employees shall be treated as Highly Compensated Employees.
The method set forth in this Section for determining who is a "Highly
Compensated Former Employee" shall be applied on a uniform and consistent basis
for all purposes for which the Code Section 414(q) definition is applicable.
1.27 "Highly Compensated Participant" means any Highly Compensated Employee
who is eligible to participate in the Plan.
1.28 "Hour of Service" means (1) each hour for which an Employee is
directly or indirectly compensated or entitled to compensation by the Employer
for the performance of duties during the applicable computation period; (2) each
hour for which an Employee is directly or indirectly compensated or entitled to
compensation by the Employer (irrespective of whether the employment
relationship has terminated) for reasons other than performance of duties (such
as vacation, holidays, sickness, jury duty, disability, lay-off, military duty
or leave of absence) during the applicable computation period; (3) each hour for
which back pay is awarded or agreed to by the Employer without regard to
mitigation of damages. These hours will be credited to the Employee for the
computation period or periods to which the award or agreement pertains rather
than the computation period in which the award, agreement or payment is made.
The same Hours of Service shall not be credited both under (1) or (2), as the
case may be, and under (3).
Notwithstanding the above, (i) no more than 501 Hours of Service are
required to be credited to an Employee on account of any single continuous
period during which the Employee performs no duties (whether or not such period
occurs in a single computation period); (ii) an hour for which an Employee is
directly or indirectly paid, or entitled to payment, on account of a period
during which no duties are performed is not required to be credited to the
Employee if such payment is made or due under a plan maintained solely for the
purpose of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws; and (iii) Hours of Service are not
required to be credited for a payment which solely reimburses an Employee for
medical or medically related expenses incurred by the Employee.
For purposes of this Section, a payment shall be deemed to be made by or
due from the Employer regardless of whether such payment is made by or due from
the Employer directly, or indirectly through, among others, a trust fund, or
insurer, to
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which the Employer contributes or pays premiums and regardless of whether
contributions made or due to the trust fund, insurer, or other entity are for
the benefit of particular Employees or are on behalf of a group of Employees in
the aggregate.
An Hour of Service must be counted for the purpose of determining a Year of
Service, a year of participation for purposes of accrued benefits, a 1-Year
Break in Service, and employment commencement date (or reemployment commencement
date). In addition, Hours of Service will be credited for employment with other
Affiliated Employers. The provisions of Department of Labor regulations
2530.200b-2(b) and (c) are incorporated herein by reference.
1.29 "Income" means the income or losses allocable to "excess amounts"
which shall equal the allocable gain or loss for the "applicable computation
period". The income allocable to "excess amounts" for the "applicable
computation period" is determined by multiplying the income for the "applicable
computation period" by a fraction. The numerator of the fraction is the "excess
amount" for the "applicable computation period". The denominator of the fraction
is the total "account balance" attributable to "Employer contributions" as of
the end of the "applicable computation period", reduced by the gain allocable to
such total amount for the "applicable computation period" and increased by the
loss allocable to such total amount for the "applicable computation period". The
provisions of this Section shall be applied:
(a) For purposes of Section 4.2(f), by substituting:
(1) "Excess Deferred Compensation" for "excess amounts";
(2) "taxable year of the Participant" for "applicable computation
period";
(3) "Deferred Compensation" for "Employer contributions"; and
(4) "Participant's Elective Account" for "account balance".
(b) For purposes of section 4.6(a), by substituting:
(1) "Excess Contributions" for "excess amount";
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(2) "Plan Year" for "applicable computation period";
(3) "Elective Contributions" for "Employer contributions"; and
(4) "Participant's Elective Account" for "account balance".
Income allocable to any distribution of Excess Deferred Compensation on or
before the last day of the taxable year of the Participant shall be calculated
from the first day of the taxable year of the Participant to the date on which
the distribution is made pursuant to either the "fractional method" or the "safe
harbor method". Under such "safe harbor method", allocable Income for such
period shall be deemed to equal ten percent (10%) of the Income allocable to
such Excess Deferred Compensation multiplied by the number of calendar months in
such period. For purposes of determining the number of calendar months in such
period, a distribution occurring on or before the fifteenth day of the month
shall be treated as having been made on the last day of the preceding month and
a distribution occurring after such fifteenth day shall be treated as having
been made on the first day of the next subsequent month.
1.30 "Investment Manager" means an entity that (a) has the power to manage,
acquire, or dispose of Plan assets and (b) acknowledges fiduciary responsibility
to the Plan in writing. Such entity must be a person, firm, or corporation
registered as an investment adviser under the Investment Advisers Act of 1940, a
bank, or an insurance company.
1.31 "Key Employee" means an Employee as defined in Code Section 416(i) and
the Regulations thereunder. Generally, any Employee or former Employee (as well
as each of his Beneficiaries) is considered a Key Employed if he, at any time
during the Plan Year that contains the "Determination Date" or any of the
preceding four (4)Plan Years, has been included in one of the following
categories:
(a) an officer of the Employer (as that term is defined within the
meaning of the Regulations under Code Section 416) having annual "415
Compensation" greater than 50 percent of the amount in effect under Code
Section 415(b)(1)(A) for any such Plan Year.
(b) one of the ten employees having annual "415 Compensation" from the
Employer for a Plan Year greater than the dollar limitation in effect under
Code Section
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415(c)(1)(A) for the calendar year in which such Plan Year ends and owning
(or considered as owning within the meaning of Code Section 318) both more
than one-half percent interest and the largest interests in the Employer.
(c) a "five percent owner" of the Employer. "Five percent owner" means
any person who owns (or is considered as owning within the meaning of Code
Section 318) more than five percent (5t) of the outstanding stock of the
Employer or stock possessing more than five percent (5%) of the total
combined voting power of all stock of the Employer or, in the case of an
unincorporated business, any person who owns more than five percent (5%) of
the capital or profits interest in the Employer. In determining percentage
ownership hereunder, employers that would otherwise be aggregated under
Code Sections 414(b), (c), (m) and (o) shall be treated as separate
employers.
(d) a "one percent owner" of the Employer having an annual "415
Compensation" from the Employer of more than $150,000. "One percent owner"
means any person who owns (or is considered as owning within the meaning of
Code Section 318) more than one percent (1%) of the outstanding stock of
the Employer or stock possessing more than one percent (1%) of the total
combined voting power of all stock of the Employer or, in the case of an
unincorporated business, any person who owns more than one percent (1%) of
the capital or profits interest in the Employer. In determining percentage
ownership hereunder, employers that would otherwise be aggregated under
Code Sections 414(b), (c), (m) and (o) shall be treated as separate
employers. However, in determining whether an individual has '"415
Compensation" of more than $150,000, "415 Compensation" from each employer
required to be aggregated under Code Sections 414(b), (c), (m) and (o)
shall be taken into account.
For purposes of this Section, the determination of "415 Compensation" shall
be made by including amounts that would otherwise be excluded from a
Participant's gross income by reason of the application of Code Sections 125,
402(a)(8), 402(h)(1)(B) and, in the case of Employer contributions made pursuant
to a salary reduction agreement, by including amounts that would otherwise be
excluded from a Participant's gross income by reason of the application of Code
Section 403(b).
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1.32 "Late Retirement Date" means the first day of the month coinciding
with or next following a Participant's actual Retirement Date after having
reached his Normal Retirement Date.
1.33 "Leased Employee" means any person (other than an Employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code Section
414(n)(6)) on a substantially full time basis for a period of at least one year,
and such services are of a type historically performed by employees in the
business field of the recipient employer. Contributions or benefits provided a
Leased Employee by the leasing organization which are attributable to services
performed for the recipient employer shall be treated as provided by the
recipient employer. A Leased Employee shall not be considered an Employee of the
recipient:
(a) if such employee is covered by a money purchase pension plan
providing:
(1) a non-integrated employer contribution rate of at least 10%
of compensation, as defined in Code 'Section 415(c)(3), but including
amounts contributed pursuant to a salary reduction agreement which are
excludable from the employee's gross income under Code Sections 125,
402(a)(8), 402(h) or 403(b);
(2) immediate participation; and
(3) full and immediate vesting; and
(b) if Leased Employees do not constitute more than 20% of the
recipient's non-highly compensated work force.
1.34 "Non-Elective Contribution" means the Employer's contributions to the
Plan excluding, however, contributions made pursuant to the Participant's
deferral election provided for in Section 4.2, matching contributions made
pursuant to Section 4.1(b) and any Qualified Non-Elective Contribution.
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1.35 "Non-Highly Compensated Participant" means any Participant who is
neither a Highly Compensated Employee nor a Family Member.
1.36 "Non-Key Employee" means any Employee or former Employee (and his
Beneficiaries) who is not a Key Employee.
1.37 "Normal Retirement Age" means the Participant's 65th birthday. A
Participant shall become fully Vested in his Participant's Account upon
attaining his Normal Retirement Age.
1.38 "Normal Retirement Date" means the first day of the month coinciding
with or next following the Participant's Normal Retirement Age.
1.39 "1-Year Break in Service" means the applicable computation period
during which an Employee has not completed more than 500 Hours of Service with
the Employer. Further, solely for the purpose of determining whether a
Participant has incurred a 1-Year Break in Service, Hours of Service shall be
recognized for "authorized leaves of absence" and "maternity and paternity
leaves of absence." Years of Service and 1-Year Breaks in Service shall be
measured on the same computation period.
"Authorized leave of absence" means an unpaid, temporary cessation from
active employment with the Employer pursuant to an established nondiscriminatory
policy, whether occasioned by illness, military service, or any other reason.
A "maternity or paternity leave of absence" means, for Plan Years beginning
after December 31, 1984, an absence from work for any period by reason of the
Employee's pregnancy, birth of the Employee's child, placement of a child with
the Employee in connection with the adoption of such child, or any absence for
the purpose of caring for such child for a period immediately following such
birth or placement. For this purpose, Hours of Service shall be credited for the
computation period in which the absence from work begins, only if credit
therefore is necessary to prevent the Employee from incurring a 1-Year Break in
Service, or, in any other case, in the immediately following computation period.
The Hours of Service credited for a "maternity or paternity leave of absence"
shall be those which would normally have been credited but for such absence, or,
in any case in which the Administrator is unable to determine such hours
normally credited, eight (8) Hours of Service per day. The total Hours of
Service required to be credited for a "maternity or paternity leave of absence"
shall not exceed 501.
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1.40 "Participant" means any Eligible Employee who participates in the Plan
as provided in Sections 3.2 and 3.3, and has not for any reason become
ineligible to participate further in the Plan.
1.41 "Participant's Account" means the account established and maintained
by the Administrator for each Participant with respect to his total interest in
the Plan and Trust resulting from the Employer's Non-Elective Contributions.
1.42 "Participant's Combined Account" means the total aggregate amount of
each Participant's Elective Account and Participant's Account.
1.43 "Participant's Elective Account" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan and Trust resulting from the Employer's Elective
Contributions. A separate accounting shall be maintained with respect to that
portion of the Participant's Elective Account attributable to Elective
Contributions pursuant to Section 4.2, Employer matching contributions pursuant
to Section 4.1(b) and any Employer Qualified Non-Elective Contributions.
1.44 "Plan" means this instrument, including all amendments thereto.
1.45 "Plan Year" means the Plan's accounting year of twelve (12) months
commencing on January lst of each year and ending the following December 31st.
1.46 "Qualified Non-Elective Contribution" means the Employer's
contributions to the Plan that are made pursuant to Section 4.1(c) and Section
4.6. Such contributions shall be considered an Elective Contribution for the
purposes of the Plan and used to satisfy the "Actual Deferral Percentage" tests.
1.47 "Regulation" means the Income Tax Regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
1.48 "Retired Participant" means a person who has been a Participant, but
who has become entitled to retirement benefits under the Plan.
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1.49 "Retirement Date" means the date as of which a Participant retires for
reasons other than Total and Permanent Disability, whether such retirement
occurs on a Participant's Normal Retirement Date or Late Retirement Date (see
Section 6.1).
1.50 "Super Top Heavy Plan" means a plan described in Section 2.2(b).
1.51 "Terminated Participant" means a person who has been a Participant,
but whose employment has been terminated other than by death, Total and
Permanent Disability or retirement.
1.52 "Top Heavy Plan" means a plan described in Section 2.2(a).
1.53 "Top Heavy Plan Year" means a Plan Year during which the Plan is a Top
Heavy Plan.
1.54 "Top Paid Group" means the top 20 percent of Employees who performed
services for the Employer during the applicable year, ranked according to the
amount of "415 Compensation" (determined for this purpose in accordance with
Section 1.25) received from the Employer during such year. All Affiliated
Employers shall be taken into account as a single employer, and Leased Employees
within the meaning of Code Sections 414(n)(2) and 414(o)(2) shall be considered
Employees unless such Leased Employees are covered by a plan described in Code
Section 414(n)(5) and are not covered in any qualified plan maintained by the
Employer. Employees who are non-resident aliens and who received no earned
income (within the meaning of Code Section 911(d)(2)) from the Employer
constituting United States source income within the meaning of Code Section
861(a)(3) shall not be treated as Employees. Additionally, for the purpose of
determining the number of active Employees in any year, the following additional
Employees shall also be excluded; however, such Employees shall still be
considered for. the purpose of identifying the particular Employees in the Top
Paid Group:
(a) Employees with less than six (6) months of service;
(b) Employees who normally work less than 17 1/2 hours per week;
(c) Employees who normally work less than six (6) months during a
year; and
(d) Employees who have not yet attained age 21.
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In addition, if 90 percent or more of the Employees of the Employer are
covered under agreements the Secretary of Labor finds to be collective
bargaining agreements between Employee representatives and the Employer, and the
Plan covers only Employees who are not covered under such agreements, then
Employees covered by such agreements shall be excluded from both the total
number of active Employees as well as from the identification of particular
Employees in the Top Paid Group.
1.55 The foregoing exclusions set forth in this section shall be applied on
a uniform and consistent basis for all purposes for which the Code Section
414(q) definition is applicable. "Total and Permanent Disability" means a
physical or mental condition of a Participant resulting from bodily injury,
disease, or mental disorder which renders him incapable of continuing his usual
and customary employment with the Employer. The disability of a Participant
shall be determined by a licensed physician chosen by the Administrator. The
determination shall be applied uniformly to all Participants.
1.56 "Trustee". means the person or entity named as trustee herein or in
any separate trust forming a part of this Plan, and any successors.
1.57 "Trust Fund" means the assets of the Plan and Trust as the same shall
exist from time to time.
1.58 "Vested" means the nonforfeitable portion of any account maintained on
behalf of a Participant.
1.59 "Year of Service" means the computation period of twelve (12)
consecutive months, herein set forth, during which an Employee has at least 1000
Hours of Service.
For vesting purposes, the computation period shall be the Plan Year,
including periods prior to the Effective Date of the Plan.
For all other purposes, the computation period shall be the Plan Year.
Notwithstanding the foregoing, for any short Plan Year, the determination
of whether an Employee has completed a Year of Service shall be made in
accordance with Department of Labor regulation 2530.203-2(c). However, in
determining whether an Employee has completed a Year of Service for benefit
accrual purposes in the short Plan Year, the number of the Hours of Service
required shall be proportionately reduced based on the
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number of full months in the short Plan Year.
Years of Service with any Affiliated Employer shall be recognized.
ARTICLE II
TOP HEAVY AND ADMINISTRATION
2.1 TOP HEAVY PLAN REQUIREMENTS
For any Top Heavy Plan Year, the Plan shall provide the special vesting
requirements of Code Section 416(b) pursuant to Section 6.4 of the Plan and the
special minimum allocation requirements of Code Section 416(c) pursuant to
Section 4.4 of the Plan.
2.2 DETERMINATION OF TOP HEAVY STATUS
(a) This Plan shall be a Top Heavy Plan for any Plan Year in which, as
of the Determination Date, (1) the Present Value of Accrued Benefits of Key
Employees and (2) the sum of the Aggregate Accounts of Key Employees under
this Plan and all plans of an Aggregation Group, exceeds sixty percent
(60%) of the Present Value of Accrued Benefits and the Aggregate Accounts
of all Key and Non-Key Employees under this Plan and all plans of an
Aggregation Group.
If any Participant is a Non-Key Employee for any Plan Year, but such
Participant was a Key Employee for any prior Plan Year, such Participant's
Present Value of Accrued Benefit and/or Aggregate Account balance shall not
be taken into account for purposes of determining whether this Plan is a
Top Heavy or Super Top Heavy Plan (or whether any Aggregation Group which
includes this Plan is a Top Heavy Group). In addition, if a Participant or
Former Participant has not performed any services for any Employer
maintaining the Plan at any time during the five year period ending on the
Determination Date, any accrued benefit for such Participant or Former
Participant shall not be taken into account for the purposes of determining
whether this Plan is a Top Heavy or Super Top Heavy Plan.
(b) This Plan shall be a Super Top Heavy Plan for any Plan Year in
which, as of the Determination Date, (1) the Present Value of Accrued
Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key
Employees under this Plan and all plans of an
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Aggregation Group, exceeds ninety percent (90%) of the Present Value of
Accrued Benefits and the Aggregate Accounts of all Key and Non-Key
Employees under this Plan and all plans of an Aggregation Group.
(c) Aggregate Account: A Participant's Aggregate Account as of the
Determination Date is the sum of:
(1) his Participant's Combined Account balance as of the most
recent valuation occurring within a twelve (12) month period ending on
the Determination Date;
(2) an adjustment for any contributions due as of the
Determination Date. Such adjustment shall be the amount of any
contributions actually made after the valuation date but due on or
before the Determination Date, except for the first Plan Year when
such adjustment shall also reflect the amount of any contributions
made after the Determination Date that are allocated as of a date in
that first Plan Year.
(3) any Plan distributions made within the Plan Year that
includes the Determination Date or within the four (4) preceding Plan
Years. However, in the case of distributions made after the valuation
date and prior to the Determination Date, such distributions are not
included as distributions for top heavy purposes to the extent that
such distributions are already included in the Participant's Aggregate
Account balance as of the valuation date. Notwithstanding anything
herein to the contrary, all distributions, including distributions
made prior to January 1, 1984, and distributions under a terminated
plan which if it had not been terminated would have been required to
be included in an Aggregation Group, will be counted. Further,
distributions from the Plan (including the cash value of life
insurance policies) of a Participant's account balance because of
death shall be treated as a distribution for the purposes of this
paragraph.
(4) any Employee contributions, whether voluntary or mandatory.
However, amounts attributable to tax deductible qualified voluntary
employee contributions shall not be
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considered to be a part of the Participant's Aggregate Account
balance.
(5) with respect to unrelated rollovers and plan-to-plan
transfers (ones which are both initiated by the Employee and made from
a plan maintained by one employer to a plan maintained by another
employer), if this Plan provides the rollovers or plan-to-plan
transfers, it shall always consider such rollovers or plan-to-plan
transfers as a distribution for the purposes of this Section. If this
Plan is the plan accepting such rollovers or plan-to-plan transfers,
it shall not consider such rollovers or plan-to-plan transfers as part
of the Participant's Aggregate Account balance.
(6) with respect to related rollovers and plan-to-plan transfers
(ones either not initiated by the Employee or made to a plan
maintained by the same employer), if this Plan provides the rollover
or plan-to-plan transfer, it shall not be counted as a distribution
for purposes of this section. If this Plan is the plan accepting such
rollover or plan-to-plan transfer, it shall consider such rollover or
plan-to-plan transfer as part of the Participant's Aggregate Account
balance, irrespective of the date on which such rollover or
plan-to-plan transfer is accepted.
(7) For the purposes of determining whether two employers are to
be treated as the same employer in (5) and (6) above, all employers
aggregated under code Section 414(b), (c), (m) and (o) are treated as
the same employer.
(d) "Aggregation Group" means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group: In determining a Required
Aggregation Group hereunder, each plan of the Employer in which a Key
Employee is a participant in the Plan Year containing the
Determination Date or any of the four preceding Plan Years, and each
other plan of the Employer which enables any plan in which a Key
Employee participates to meet the requirements of Code Sections
401(a)(4) or 410, will be required to be
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aggregated. Such group shall be known as a Required Aggregation Group.
In the case of a Required Aggregation Group, each plan in the group
will be considered a Top Heavy Plan if the Required Aggregation Group
is a Top Heavy Group. No plan in the Required Aggregation Group will
be considered a Top Heavy Plan if the Required Aggregation Group is
not a Top Heavy Group.
(2) Permissive Aggregation Group: The Employer may also include
any other plan not required to be included in the Required Aggregation
Group, provided the resulting group, taken as a whole, would continue
to satisfy the provisions of Code Sections 401(a)(4) and 410. Such
group shall be known as a Permissive Aggregation Group.
In the case of a Permissive Aggregation Group, only a plan that is
part of the Required Aggregation Group will be considered a Top Heavy
Plan if the Permissive Aggregation Group is a Top Heavy Group. No plan
in the Permissive Aggregation Group will be considered a Top Heavy
Plan if the Permissive Aggregation Group is not a Top Heavy Group.
(3) Only those plans of the Employer in which the Determination
Dates fall within the same calendar year shall be aggregated in order
to determine whether such plans are Top Heavy Plans.
(4) An Aggregation Group shall include any terminated plan of
the Employer if it' was maintained within the last five (5) years
ending on the Determination Date.
(e) "Determination Date" means (a) the last day of the preceding Plan
Year, or (b) in the case of the first Plan Year, the last day of such Plan
Year.
(f) Present Value of Accrued Benefit: In the case of a defined benefit
plan, the Present Value of Accrued Benefit for a Participant other than a
Key Employee, shall be as determined using the single accrual method used
for all plans of the Employer and Affiliated Employers, or if no such
single method exists, using a method which results in benefits
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accruing not more rapidly than the slowest accrual rate permitted under
Code Section 411(b)(1)(C). The determination of the Present Value of
Accrued Benefit shall be determined as of the most recent valuation date
that falls within or ends with the 12-month period ending on the
Determination Date except as provided in Code Section 416 and the
Regulations thereunder for the first and second plan years of a defined
benefit plan.
(g) "Top Heavy Group" means an Aggregation Group in which, as of the
Determination Date, the sum of:
(1) the Present Value of Accrued Benefits of Key Employees under
all defined benefit plans included in the group, and
(2) the Aggregate Accounts of Key Employees under all defined
contribution plans included in the group,
exceeds sixty percent (60%) of a similar sum determined for all
Participants.
2.3 POWERS AND RESPONSIBILITIES OF THE EMPLOYER
(a) The Employer shall be empowered to appoint and remove the Trustee
and the Administrator from time to time as it deems necessary for the
proper administration of the Plan to assure that the Plan is being operated
for the exclusive benefit of the Participants and their Beneficiaries in
accordance with the terms of the Plan, the Code, and the Act.
(b) The Employer shall establish a "funding policy and method", i.e.,
it shall determine whether the Plan has a short run need for liquidity
(e.g., to pay benefits) or whether liquidity is a long run goal and
investment growth (and stability of same) is a more current need, or shall
appoint a qualified person to do so. The Employer or its delegate shall
communicate such needs and goals to the Trustee, who shall coordinate such
Plan needs with its investment policy. The communication of such a "funding
policy and method" shall not, however, constitute a directive to the
Trustee as to investment of the Trust Funds. Such "funding policy and
method" shall be consistent with the objectives of this Plan and with the
requirements of Title I of the Act.
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(c) The Employer shall periodically review the performance of any
Fiduciary or other person to whom duties have been delegated or allocated
by it under the provisions of this Plan or pursuant to procedures
established hereunder. This requirement may be satisfied by formal periodic
review by the Employer or by a qualified person specifically designated by
the Employer, through day-to-day conduct and evaluation, or through other
appropriate ways.
2.4 DESIGNATION OF ADMINISTRATIVE AUTHORITY
The Employer shall appoint one or more Administrators. Any person,
including, but not limited to, the Employees of the Employer, shall be eligible
to serve as an Administrator. Any person so appointed shall signify his
acceptance by filing written acceptance with the Employer. An Administrator may
resign by delivering his written resignation to the Employer or be removed by
the Employer by delivery of written notice of removal, to take effect at a date
specified therein, or upon delivery to the Administrator if no date is
specified.
The Employer, upon the resignation or removal of an Administrator, shall
promptly designate in writing a successor to this position. If the Employer does
not appoint an Administrator, the Employer will function as the Administrator.
2.5 ALLOCATION AND DELEGATION OF RESPONSIBILITIES
If more than one person is appointed as Administrator, the responsibilities
of each Administrator may be specified by the Employer and accepted in writing
by each Administrator. In the event that no such delegation is made by the
Employer, the Administrators may allocate the responsibilities among themselves,
in which event the Administrators shall notify the Employer and the Trustee in
writing of such action and specify the responsibilities of each Administrator.
The Trustee thereafter shall accept and rely upon any documents executed by the
appropriate Administrator until such time as the Employer or the Administrators
file with the Trustee a written revocation of such designation.
2.6 POWERS AND DUTIES OF THE ADMINISTRATOR
The primary responsibility of the Administrator is to administer the Plan
for the exclusive benefit of the Participants and their Beneficiaries, subject
to the specific terms of the Plan. The Administrator shall administer the Plan
in accordance with its terms and shall have the power and discretion to
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<PAGE>
construe the terms of the Plan and to determine all questions arising in
connection with the administration, interpretation, and application of the Plan.
Any such determination by the Administrator shall be conclusive and binding upon
all persons. The Administrator may establish procedures, correct any defect,
supply any information, or reconcile any inconsistency in such manner and to
such extent as shall be deemed necessary or advisable to carry out the purpose
of the Plan; provided, however, that any procedure, discretionary act,
interpretation or construction shall be done in a nondiscriminatory manner based
upon uniform principles consistently applied and shall be consistent with the
intent that the Plan shall continue to be deemed a qualified plan under the
terms of Code Section 401(a), and shall comply with the terms of the Act and all
regulations issued pursuant thereto. The Administrator shall have all powers
necessary or appropriate to accomplish his duties under this Plan.
The Administrator shall be charged with the duties of the general
administration of the Plan, including, but not limited to, the following:
(a) the discretion to determine all questions relating to the
eligibility of Employees to participate or remain a Participant hereunder
and to receive benefits under the Plan;
(b) to compute, certify, and direct the Trustee with respect to the
amount and the kind of benefits to which any Participant shall be entitled
hereunder;
(c) to authorize and direct the Trustee with respect to all
nondiscretionary or otherwise directed disbursements from the Trust;
(d) to maintain all necessary records for the administration of the
Plan;
(e) to interpret the provisions of the Plan and to make and publish
such rules for regulation of the Plan as are consistent with the terms
hereof;
(f) to determine the size and type of any Contract to be purchased
from any insurer, and to designate the insurer from which such Contract
shall be purchased;
(g) to compute and certify to the Employer and to the Trustee from
time to time the sums of money necessary or desirable to be contributed to
the Plan;
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(h) to consult with the Employer and the Trustee regarding the short
and long-term liquidity needs of the Plan in order that the Trustee can
exercise any investment discretion in a manner designed to accomplish
specific objectives;
(i) to prepare and implement a procedure to notify Eligible Employees
that they may elect to have a portion of their Compensation deferred or
paid to them in cash;
(j) to assist any Participant regarding his rights, benefits, or
elections available under the Plan.
2.7 RECORDS AND REPORTS
The Administrator shall keep a record of all actions taken and shall keep
all other books of account, records, and other data that may be necessary for
proper administration of the Plan and shall be responsible for supplying all
information and reports to the Internal Revenue Service, Department of Labor,
Participants, Beneficiaries and others as required by law.
2.8 APPOINTMENT OF ADVISERS
The Administrator, or the Trustee with the consent of the Administrator,
may appoint counsel, specialists, advisers, and other persons as the
Administrator or the Trustee deems necessary or desirable in connection with the
administration of this Plan.
2.9 INFORMATION FROM EMPLOYER
To enable the Administrator to perform his functions, the Employer shall
supply full and timely information to the Administrator on all matters relating
to the Compensation of all Participants, their Hours of Service, their Years of
Service, their retirement, death, disability, or termination of employment, and
such other pertinent facts as the Administrator may require; and the
Administrator shall advise the Trustee of such of the foregoing facts as may be
pertinent to the Trustee's duties under the Plan. The Administrator may rely
upon such information as is supplied by the Employer and shall have no duty or
responsibility to verify such information.
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2.10 PAYMENT OF EXPENSES
All expenses of administration may be paid out of the Trust Fund unless
paid by the Employer. Such expenses shall include any expenses incident to the
functioning of the Administrator, including, but not limited to, fees of
accountants, counsel, and other specialists and their agents, and other costs of
administering the Plan. Until paid, the expenses shall constitute a liability of
the Trust Fund. However, the Employer may reimburse the Trust Fund for any
administration expense incurred.
2.11 MAJORITY ACTIONS
Except where there has been an allocation and delegation of administrative
authority pursuant to Section 2.5, if there shall be more than one
Administrator, they shall act by a majority of their number, but may authorize
one or more of them to sign all papers on their behalf.
2.12 CLAIMS PROCEDURE
Claims for benefits under the Plan may be filed with the Administrator on
forms supplied by the Employer. Written notice of the disposition of a claim
shall be furnished to the claimant within 90 days after the application is
filed. In the event the claim is denied, the reasons for the denial shall be
specifically set forth in the notice in language calculated to be understood by
the claimant, pertinent provisions of the Plan shall be cited, and, where
appropriate, an explanation as to how the claimant can perfect the claim will be
provided. In addition, the claimant shall be furnished with an explanation of
the Plan's claims review procedure.
2.13 CLAIMS REVIEW PROCEDURE
Any Employee, former Employee, or Beneficiary of either, who has been
denied a benefit by a decision of the Administrator pursuant to Section 2.12
shall be entitled to request the Administrator to give further consideration to
his claim by filing with the Administrator (on a form which may be obtained from
the Administrator) a request for a hearing. Such request, together with a
written statement of the reasons why the claimant believes his claim should be
allowed, shall be filed with the Administrator no later than 60 days after
receipt of the written notification provided for in Section 2.12. The
Administrator shall then conduct a hearing within the next 60 days, at which the
claimant may be represented by an attorney or any other representative of his
choosing and at which the
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claimant shall have an opportunity to submit written and oral evidence and
arguments in support of his claim. At the hearing (or prior thereto upon 5
business days written notice to the Administrator) the claimant or his
representative shall have an opportunity to review all documents in the
possession of the Administrator which are pertinent to the claim at issue and
its disallowance. Either the claimant or the Administrator may cause a court
reporter to attend the hearing and record the proceedings. In such event, a
complete written transcript of the proceedings shall be furnished to both
parties by the court reporter. The full expense of any such court reporter and
such transcripts shall be borne by the party causing the court reporter to
attend the hearing. A final decision as to the allowance of the claim shall be
made by the Administrator within 60 days of receipt of the appeal (unless there
has been an extension of 60 days due to special circumstances, provided the
delay and the special circumstances occasioning it are communicated to the
claimant within the 60 day period). Such communication shall be written in a
manner calculated to be understood by the claimant and shall include specific
reasons for the decision and specific references to the pertinent Plan
provisions on which the decision is based.
ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY
Any Eligible Employee shall be eligible to participate hereunder on the
date of his employment with the Employer. However, any Employee who was a
Participant in the Plan prior to the effective date of this amendment and
restatement shall continue to participate in the Plan. The Employer shall give
each prospective Eligible Employee written notice of his eligibility to
participate in the Plan prior to the close of the Plan Year in which he first
becomes an Eligible Employee.
3.2 APPLICATION FOR PARTICIPATION
In order to become a Participant hereunder, each Eligible Employee shall
make application to the Employer for participation in the Plan and agree to the
terms hereof. Upon the acceptance of any benefits under this Plan, such Employee
shall automatically be deemed to have made application and shall be bound by the
terms and conditions of the Plan and all amendments hereto.
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3.3 EFFECTIVE DATE OF PARTICIPATION
For Plan Years beginning prior to January 1, 1991, an Eligible Employee
shall become a Participant effective as of the first day of the Plan Year next
following the date on which such Employee met the eligibility requirements of
Section 3.1, provided said Employee was still employed as of such date (or if
not employed on such date, as of the date of rehire if a 1-Year Break in Service
has not occurred).
For Plan Years beginning after December 31, 1990, an Eligible Employee
shall become a Participant effective as of the earlier of the first day of the
Plan Year or the first day of the seventh month of such Plan Year coinciding
with or next following the date such Employee met the eligibility requirements
of Section 3.1, provided said Employee was still employed as of such date (or if
not employed on such date, as of the date of rehire if a 1-Year Break in Service
has not occurred).
In the event an Employee who is not a member of an eligible class of
Employees becomes a member of an eligible class, such Employee will participate
immediately if such Employee would have otherwise previously become a
Participant.
3.4 DETERMINATION OF ELIGIBILITY
The Administrator shall determine the eligibility of each Employee for
participation in the Plan based upon information furnished by the Employer. Such
determination shall be conclusive and binding upon all persons, as long as the
same is made pursuant to the Plan and the Act. Such determination shall be
subject to review per Section 2.13.
3.5 TERMINATION OF ELIGIBILITY
(a) In the event a Participant shall go from a classification of an
Eligible Employee to an ineligible Employee, such Former Participant shall
continue to vest in his interest in the Plan for each Year of Service
completed while a noneligible Employee, until such time as his
Participant's Account shall be forfeited or distributed pursuant to the
terms of the Plan. Additionally, his interest in the Plan shall continue to
share in the earnings of the Trust Fund.
(b) In the event a Participant is no longer a member of an eligible
class of Employees and becomes ineligible to participate but has not
incurred a l-Year Break in Service, such Employee will participate
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immediately upon returning to an eligible class of Employees. If such
Participant incurs a 1-Year Break in Service, eligibility will be
determined under the break in service rules of the Plan.
3.6 OMISSION OF ELIGIBLE EMPLOYEE
If, in any Plan Year, any Employee who should be included as a Participant
in the Plan is erroneously omitted and discovery of such omission is not made
until after a contribution by his Employer for the year has been made, the
Employer shall make a subsequent contribution with respect to the omitted
Employee in the amount which the said Employer would have contributed with
respect to him had he not been omitted. Such contribution shall be made
regardless of whether or not it is deductible in whole or in part in any taxable
year under applicable provisions of the Code.
3.7 INCLUSION OF INELIGIBLE EMPLOYEE
If, in any Plan Year, any person who should not have been included as a
Participant in the Plan is erroneously included and discovery of such incorrect
inclusion is not made until after a contribution for the year has been made, the
Employer shall not be entitled to recover the contribution made with respect to
the ineligible person regardless of whether or not a deduction is allowable with
respect to such contribution. In such event, the amount contributed with respect
to the ineligible person shall constitute a Forfeiture (except for Deferred
Compensation which shall be distributed to the ineligible person) for the Plan
Year in which the discovery is made.
3.8 ELECTION NOT TO PARTICIPATE
An Employee may, subject to the approval of the Employer, elect voluntarily
not to participate in the Plan. The election not to participate must be
communicated to the Employer, in writing, at least thirty (30) days before the
beginning of a Plan Year.
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ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION
For each Plan Year, the Employer shall contribute to the Plan:
(a) The amount of the total salary reduction elections of all
Participants made pursuant to Section 4.2(a), which amount shall be deemed
an Employer's Elective Contribution.
(b) On behalf of each Participant who is eligible to share in matching
contributions for the Plan Year, a matching contribution equal to 50% of
each such Participant's Deferred Compensation plus a discretionary
percentage of each such Participant's Deferred Compensation, the exact
percentage to be determined each year by the Employer, which amount shall
be deemed an Employer's Elective Contribution.
Except, however, in applying the matching percentage specified above,
only salary reductions up to $1,000 shall be considered.
(c) On behalf of each Participant who is eligible to share in the
Qualified Non-Elective contribution for the Plan Year, a discretionary
Qualified Non-Elective Contribution equal to a percentage of each eligible
individuals Compensation, the exact percentage to be determined each year
by the Employer. The Employer's Qualified Non-Elective Contribution shall
be deemed an Employer's Elective Contribution.
(d) A discretionary amount, which amount shall be deemed an Employer's
Non-Elective Contribution.
(e) Notwithstanding the foregoing, however, the Employer's
contributions for any Plan Year shall not exceed the maximum amount
allowable as a the Employer under the provisions of Code Section 404. All
contributions by the Employer shall be or in such property as is acceptable
to the Trustee.
(f) Except, however, to the extent necessary to provide the top heavy
minimum allocations, the Employer shall make a contribution even if it
exceeds the amount which is deductible under Code Section 404.
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4.2 PARTICIPANT'S SALARY REDUCTION ELECTION
(a) Each Participant may elect to defer his Compensation which would
have been received in the Plan Year, but for the deferral election, by up
to 15%. A deferral election (or modification of an earlier election) may
not be made with respect to Compensation which is currently available on or
before the date the Participant executed such election.
The amount by which Compensation is reduced shall be that
Participant's Deferred Compensation and be treated as an Employer Elective
contribution and allocated to that Participant's Elective Account.
(b) The balance in each Participant's Elective Account shall be fully
Vested at all times and shall not be subject to Forfeiture for any reason.
(c) Amounts held in the Participant's Elective Account may not be
distributable earlier than:
(1) a Participant's termination of employment, Total and
Permanent Disability, or death;
(2) a Participant's attainment of age 59 1/2;
(3) the termination of the Plan without the establishment or
existence of a "successor plan", as that term is described in
Regulation 1.401(k)-1(d)(3);
(4) the date of disposition by the Employer to an entity that is
not an Affiliated Employer of substantially all of the assets (within
the meaning of Code section 409(d)(2)) used in a trade or business of
such corporation if such corporation continues to maintain this Plan
after the disposition with respect to a Participant who continues
employment with the corporation acquiring such assets;
(5) the date of disposition by the Employer or an Affiliated
Employer who maintains the Plan of its interest in a subsidiary
(within the meaning of Code Section 409(d)(3)) to an entity which is
not an Affiliated Employer but only with respect to a Participant who
continues employment with such subsidiary; or
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(6) the proven financial hardship of a Participant, subject to
the limitations of Section 6.10.
(d) For each Plan Year beginning after December 31, 1987, a
Participant's Deferred Compensation made under this Plan and all other
plans, contracts or arrangements of the Employer maintaining this Plan
shall not exceed, during any taxable year of the Participant, the
limitation imposed by code section 402(g), as in effect at the beginning of
such taxable year. If such dollar limitation is exceeded, a Participant
will be deemed to have notified the Administrator of such excess amount
which shall be distributed in a manner consistent with 4.2(f). The dollar
limitation shall be adjusted annually pursuant to the method provided in
Code Section 415(d) in accordance with Regulations.
(e) In the event a Participant has received a hardship distribution
from his Participant's Elective Account pursuant to Section 6.10 or
pursuant to Regulation 1.401(k)-l(d)(2)(iv)(B) from any other plan
maintained by the Employer, then such Participant shall not be permitted to
elect to have Deferred Compensation contributed to the Plan on his behalf
for a period of twelve (12) months following the receipt of the
distributions. Furthermore, the dollar limitation under Code Section 402(g)
shall be reduced, with respect to the Participant's taxable year following
the taxable year in which the hardship distribution was made, by the amount
of such Participant's Deferred Compensation, if any, pursuant to this Plan
(and any other plan maintained by the Employer) for the taxable year of the
hardship distribution.
(f) If a Participant's Deferred Compensation under this Plan together
with any elective deferrals (as defined in Regulation 1.402(g)-l(b)) under
another qualified cash or deferred arrangement (as defined in Code Section
401(k)), a simplified employee pension (as defined in Code Section 408(k)),
a salary reduction arrangement (within the meaning of Code Section
3121(a)(5)(D)), a deferred compensation plan under Code Section 457, or a
trust described in Code Section 501(c)(18) cumulatively exceed the
limitation imposed by Code Section 402(g) (as adjusted annually in
accordance with the method provided in Code Section 415(d) pursuant to
Regulations) for such Participant's
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taxable year, the Participant may, not later than March 1 following the
close of the Participant's taxable year, notify the Administrator in
writing of such excess and request that his Deferred Compensation under
this Plan be reduced by an amount specified by the Participant. In such
event, the Administrator may direct the Trustee to distribute such excess
amount (and any Income allocable to such excess amount) to the Participant
not later than the first April 15th following the close of the
Participant's taxable year. Distributions in accordance with this paragraph
may be made for any taxable year of the Participant which begins after
December 31, 1986. Any distribution of less than the entire amount of
Excess Deferred Compensation and Income shall be treated as a pro rata
distribution of Excess Deferred Compensation and Income. The amount
distributed shall not exceed the Participant's Deferred Compensation under
the Plan for the taxable year. Any distribution on or before the last day
of the Participant's taxable year must satisfy each of the following
conditions:
(1) the distribution must be made after the date on which the
Plan received the Excess Deferred Compensation;
(2) the Participant shall designate the distribution as Excess
Deferred Compensation; and
(3) the Plan must designate the distribution as a distribution of
Excess Deferred Compensation.
Any distribution made pursuant to this Section 4.2(f) shall be made
first from unmatched Deferred Compensation and, thereafter, simultaneously
from Deferred Compensation which is matched and matching contributions
which relate to such Deferred Compensation.
(g) Notwithstanding Section 4.2(f) above, a Participant's Excess
Deferred Compensation shall be reduced, but not below zero, by any
distribution of Excess Contributions pursuant to Section 4.6(a) for the
Plan Year beginning with or within the taxable year of the Participant.
(h) At Normal Retirement Date, or such other date when the Participant
shall be entitled to receive benefits, the fair market value of the
Participant's
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Elective Account shall be used to provide additional benefits to the
Participant or his Beneficiary.
(i) All amounts allocated to a Participant's Elective Account may be
treated as a Directed Investment Account pursuant to Section 4.10.
(j) Employer Elective Contributions made pursuant to this Section may
be segregated into a separate account for each Participant in a federally
insured savings account, certificate of deposit in a bank or savings and
loan association, money market certificate, or other short-term debt
security acceptable to the Trustee until such time as the allocations
pursuant to Section 4.4 have been made.
(k) The Employer and the Administrator shall implement the salary
reduction elections provided for herein in accordance with the following:
(1) A Participant may commence making elective deferrals to the
Plan only after first satisfying the eligibility and participation
requirements specified in Article III. However, the Participant must
make his initial salary deferral election within a reasonable time,
not to exceed thirty (30) days, after entering the Plan pursuant to
Section 3.3. If the Participant fails to make an initial salary
deferral election within such time, then such Participant may
thereafter make an election in accordance with the rules governing
modifications. The Participant shall make such an election by entering
into a written salary reduction agreement with the Employer and filing
such agreement with the Administrator. Such election shall initially
be effective beginning with the pay period following the acceptance of
the salary reduction agreement by the Administrator, shall not have
retroactive effect and shall remain in force until revoked.
(2) A Participant may modify a prior election during the Plan
Year and concurrently make a new election by filing a written notice
with the Administrator within a reasonable time before the pay period
for which such modification is to be effective. However, modifications
to a salary deferral election shall only be permitted
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quarterly, during election periods established by the Administrator
prior to the first day of each Plan Year quarter. Any modification
shall not have retroactive effect and shall remain in force until
revoked.
(3) A Participant may elect to prospectively revoke his salary
reduction agreement in its entirety at any time during the Plan Year
by providing the Administrator with thirty (30) days written notice of
such revocation (or upon such shorter notice period as may be
acceptable to the Administrator). Such revocation shall become
effective as of the beginning of the first pay period coincident with
or next following the expiration of the notice period. Furthermore,
the termination of the Participant's employment, or the cessation of
participation for any reason, shall be deemed to revoke any salary
reduction agreement then in effect, effective immediately following
the close of the pay period within which such termination or cessation
occurs.
4.3 TIME OF PAYMENT OF EMPLOYER'S CONTRIBUTION
The Employer shall generally pay to the Trustee its contribution to the
Plan for each Plan Year within the time prescribed by law, including extensions
of time, for the filing of the Employer's federal income tax return for the
Fiscal Year.
However, Employer Elective Contributions accumulated through payroll
deductions shall be paid to the Trustee as of the earliest date on which such
contributions can reasonably be segregated from the Employer's general assets,
but in any event within ninety (90) days from the date on which such amounts
would otherwise have been payable to the Participant in cash. The provisions of
Department of Labor regulations 2510.3-102 are incorporated herein by reference.
Furthermore, any additional Employer contributions which are allocable to the
Participant's Elective Account for a Plan Year shall be paid to the Plan no
later than the twelve-month period immediately following the close of such Plan
Year.
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<PAGE>
4.4 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS
(a) The Administrator shall establish and maintain an account in the
name of each Participant to which the Administrator shall credit as of each
Anniversary Date all amounts allocated to each such Participant as set
forth herein.
(b) The Employer shall provide the Administrator with all information
required by the Administrator to make a proper allocation of the Employer's
contributions for each Plan Year. Within a reasonable period of time after
the date of receipt by the Administrator of such information, the
Administrator shall allocate such contribution as follows:
(1) With respect to the Employer's Elective Contribution made
pursuant to Section 4.1(a), to each Participant's Elective Account in
an amount equal to each such Participant's Deferred Compensation for
the year.
(2) With respect to the Employer's Elective contribution made
pursuant to Section 4.1(b), to each Participant's Elective Account in
accordance with Section 4.1(b).
Only Participants who have completed a Year of Service during the Plan
Year and are actively employed on the last day of the Plan Year shall
be eligible to share in the matching contribution for the year.
(3) With respect to the Employer's Qualified Non-Elective
Contribution made pursuant to Section 4.1(c), to each Participant's
Elective Account in accordance with Section 4.1(c).
Only Participants who have completed a Year of Service during the Plan
Year and are actively employed on the last day of the Plan Year shall
be eligible to share in the Qualified Non-Elective Contribution for
the year.
(4) With respect to the Employer's Non-Elective Contribution made
pursuant to Section 4.1(d), to each Participant's Account in the same
proportion that each such Participant's Compensation for the year
bears to the total Compensation of all Participants for such year.
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<PAGE>
Only Participants who have completed a Year of Service during the Plan
Year and are actively employed on the last day of the Plan Year shall
be eligible to share in the discretionary contribution for the year.
(c) As of each Anniversary Date any amounts which became Forfeitures
since the last Anniversary Date shall first be made available to reinstate
previously forfeited account balances of Former Participants, if any, in
accordance with Section 6.4(f)(2). The remaining Forfeitures, if any, shall
be added to the Employer's discretionary contribution pursuant to Section
4.1(d) and for the Plan Year in which such Forfeitures occur allocated
among the Participants' Accounts in the same manner as the Employer's
discretionary contribution for the current year.
Provided, however, that in the event the allocation of Forfeitures
provided herein shall cause the "annual addition" (as defined in Section
4.7) to any Participant's Account to exceed the amount allowable by the
Code, the excess shall be reallocated in accordance with Section 4.8.
(d) For any Top Heavy Plan Year, Employees not otherwise eligible to
share in the allocation of contributions and Forfeitures as provided above,
shall receive the minimum allocation provided for in Section 4.4(g) if
eligible pursuant to the provisions of Section 4.4(i).
(e) Participants who are not actively employed on the last day of the
Plan Year due to Retirement (Normal or Late), Total and Permanent
Disability or death shall share in the allocation of contributions and
Forfeitures for that Plan Year only if otherwise eligible in accordance
with this Section.
(f) As of each Anniversary Date or other valuation date, before
one-half of the current valuation period allocation of Employer
contributions and after allocation of Forfeitures, any earnings or losses
(net appreciation or net depreciation) of the Trust Fund shall be allocated
in the same proportion that each Participant's and Former Participant's
nonsegregated accounts bear to the total of all Participants' and Former
Participants' nonsegregated accounts as of such date.
<PAGE>
38
Participants' transfers from other qualified plans deposited in the
general Trust Fund shall share in any earnings and losses (net appreciation
or net depreciation) of the Trust Fund in the same manner provided above.
Each segregated account maintained on behalf of a Participant shall be
credited or charged with its separate earnings and losses.
(g) Minimum Allocations Required for Top Heavy Plan Years:
Notwithstanding the foregoing, for any Top Heavy Plan Year, the sum of the
Employer's contributions and Forfeitures allocated to the Participant's
Combined Account of each Employee shall be equal to at least three percent
(3%) of such Employee's "415 Compensation" (reduced by contributions and
forfeitures, if any, allocated to each Employee in any defined contribution
plan included with this plan in a Required Aggregation Group). However, if
(1) the sum of the Employer's contributions and Forfeitures allocated to
the Participant's Combined Account of each Key Employee for such Top Heavy
Plan Year is less than three percent (3%) of each Key Employee's "415
Compensation" and (2) this Plan is not required to be included in an
Aggregation Group to enable a defined benefit plan to meet the requirements
of Code Section 401(a)(4) or 410, the sum of the Employer's contributions
and Forfeitures allocated to the Participant's Combined Account of each
Employee shall be equal to the largest percentage allocated to the
Participant's Combined Account of any Key Employee. However, in determining
whether a Non-Key Employee has received the required minimum allocation,
such Non-Key Employee's Deferred Compensation and matching contributions
needed to satisfy the "Actual Deferral Percentage" tests pursuant to
Section 4.5(a) shall not be taken into account.
However, no such minimum allocation shall be required in this Plan for
any Employee who participates in another defined contribution plan subject
to Code Section 412 providing such benefits included with this Plan in a
Required Aggregation Group.
(h) For purposes of the minimum allocations set forth above, the
percentage allocated to the Participant's Combined Account of any Key
Employee shall be equal to the ratio of the sum of the Employer's
contributions and Forfeitures allocated on behalf of such Key Employee
divided by the "415 Compensation" for such Key Employee.
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<PAGE>
(i) For any Top Heavy Plan Year, the minimum allocations set forth
above shall be allocated to the Participant's Combined Account of all
Employees who are Participants and who are employed by the Employer on the
last day of the Plan Year, including Employees who have (1) failed to
complete a Year of Service; and (2) declined to make mandatory
contributions (if required) or, in the case of a cash or deferred
arrangement, elective contributions to the Plan.
(j) For the purposes of this Section, "415 Compensation" shall be
limited to $200,000. Such amount shall be adjusted at the same time and in
the same manner as permitted under Code Section 415(d), except that the
dollar increase in effect on January 1 of any calendar year shall be
effective for the Plan Year beginning with or within such calendar year and
the first adjustment to the $200,000 limitation shall be effective on
January 1, 1990. For any short Plan Year the "415 Compensation" limit shall
be an amount equal to the "415 Compensation" limit for the calendar year in
which the Plan Year begins multiplied by the ratio obtained by dividing the
number of full months in the short Plan Year by twelve (12). However, for
Plan Years beginning prior to January 1, 1989, the $200,000 limit shall
apply only for Top Heavy Plan Years and shall not be adjusted.
(k) Notwithstanding anything herein to the contrary, Participants who
terminated employment for any reason during the Plan Year shall share in
the salary reduction contributions made by the Employer for the year of
termination without regard to the Hours of Service credited.
(l) If a Former Participant is reemployed after five (5) consecutive
1-Year Breaks in Service, then separate accounts shall be maintained as
follows:
(1) one account for nonforfeitable benefits attributable to
pre-break service; and
(2) one account representing his status in the Plan attributable
to post-break service.
(m) Notwithstanding anything to the contrary, for Plan Years beginning
after December 31, 1989, if this is a Plan that would otherwise fail to
meet the requirements of Code Sections 401(a)(26), 410(b)(1) or
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<PAGE>
410(b)(2)(A)(i) and the Regulations thereunder because Employer
contributions would not be allocated to a sufficient number or percentage
of Participants for a Plan Year, then the following rules shall apply:
(1) The group of Participants eligible to share in the Employer's
contribution and Forfeitures for the Plan Year shall be expanded to
include the minimum number of Participants who would not otherwise be
eligible as are necessary to satisfy the applicable test specified
above. The specific Participants who shall become eligible under the
terms of this paragraph shall be those who are actively employed on
the last day of the Plan Year and, when compared to similarly situated
Participants, have completed the greatest number of Hours of Service
in the Plan Year.
(2) If after application of paragraph (1) above, the applicable
test is still not satisfied, then the group of Participants eligible
to share in the Employer's contribution and Forfeitures for the Plan
Year shall be further expanded to include the minimum number of
Participants who are not actively employed on the last day of the Plan
Year as are necessary to satisfy the applicable test. The specific
Participants who shall become eligible to share shall be those
Participants, when compared to similarly situated Participants, who
have completed the greatest number of Hours of Service in the Plan
Year before terminating employment.
(3) Nothing in this Section shall permit the reduction of a
Participant's accrued benefit. Therefore any amounts that have
previously been allocated to Participants may not be reallocated to
satisfy these requirements. In such event, the Employer shall make an
additional contribution equal to the amount such affected Participants
would have received had they been included in the allocations, even if
it exceeds the amount which would be deductible under Code Section
404. Any adjustment to the allocations pursuant to this paragraph
shall be considered a retroactive amendment adopted by the last day of
the Plan Year.
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<PAGE>
(4) Notwithstanding the foregoing, for any Top Heavy Plan Year
beginning after December 31, 1992, if the portion of the Plan which is
not a Code Section 401(k) or 401(m) plan would fail to satisfy Code
Section 410(b) if the coverage tests were applied by treating those
Participants whose only allocation (under such portion of the Plan)
would otherwise be provided under the top heavy formula as if they
were not currently benefiting under the Plan, then, for purposes of
this Section 4.4(m), such Participants shall be treated as not
benefiting and shall therefore be eligible to be included in the
expanded class of Participants who will share in the allocation
provided under the Plan's non top heavy formula.
4.5 ACTUAL DEFERRAL PERCENTAGE TESTS
(a) Maximum Annual Allocation: For each Plan Year beginning after
December 31, 1986, the annual allocation derived from Employer Elective
Contributions to a Participant's Elective Account shall satisfy one of the
following tests:
(1) The "Actual Deferral Percentage" for the Highly Compensated
Participant group shall not be more than the "Actual Deferral
Percentage" of the Non-Highly Compensated Participant group multiplied
by 1.25, or
(2) The excess of the "Actual Deferral Percentage" for the Highly
Compensated Participant group over the "Actual Deferral Percentage"
for the Non-Highly Compensated Participant group shall not be more
than two percentage points. Additionally, the "Actual Deferral
Percentage" for the Highly Compensated Participant group shall not
exceed the "Actual Deferral Percentage" for the Non-Highly Compensated
Participant group multiplied by 2. The provisions of Code Section
401(k)(3) and Regulation 1.401(k)-l(b) are incorporated herein by
reference.
However, for Plan Years beginning after December 31, 1988, in
order to prevent the multiple use of the alternative method described
in (2) above and in Code Section 401(m)(9)(A), any Highly Compensated
Participant eligible to
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<PAGE>
make elective deferrals pursuant to Section 4.2 and to make Employee
contributions or to receive matching contributions under any other
plan maintained by the Employer or an Affiliated Employer shall have
his actual contribution ratio reduced pursuant to Regulation
1.401(m)-2, the provisions of which are incorporated herein by
reference.
(b) For the purposes of this Section "Actual Deferral Percentage"
means, with respect to the Highly Compensated Participant group and
Non-Highly Compensated Participant group for a Plan Year, the average of
the ratios, calculated separately for each Participant in such group, of
the amount of Employer Elective contributions allocated to each
Participant's Elective Account for such Plan Year, to such Participant's
"414(s) Compensation" for such Plan Year. The actual deferral ratio for
each Participant and the "Actual Deferral Percentage" for each group shall
be calculated to the nearest one-hundredth of one percent for Plan Years
beginning after December 31, 1988. Employer Elective Contributions
allocated to each Non-Highly Compensated Participant's Elective Account
shall be reduced by Excess Deferred Compensation to the extent such excess
amounts are made under this Plan or any other plan maintained by the
Employer and any matching contributions which relate to such Excess
Deferred Compensation.
(c) For the purpose of determining the actual deferral ratio of a
Highly Compensated Employee who is subject to the Family Member aggregation
rules of Code Section 414(q)(6) because such Participant is either a "five
percent owner" of the Employer or one of the ten (10) Highly Compensated
Employees paid the greatest "415 Compensation" during the year, the
following shall apply:
(1) The combined actual deferral ratio for the family group
(which shall be treated as one Highly Compensated Participant) shall
be determined by aggregating Employer Elective Contributions and
"414(s) Compensation" of all eligible Family Members (including Highly
Compensated Participants). However, in applying the $200,000 limit to
"414(s) Compensation", for Plan Years beginning after December 31,
1988, Family Members shall include only the affected
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<PAGE>
Employee's spouse and any lineal descendants who have not attained age
19 before the close of the Plan Year. Notwithstanding the foregoing,
with respect to Plan Years beginning prior to January 1, 1990,
compliance with the Regulations then in effect shall be deemed to be
compliance with this paragraph.
(2) The Employer Elective Contributions and "414(s) Compensation"
of all Family Members shall be disregarded for purposes of determining
the "Actual Deferral Percentage" of the Non-Highly Compensated
Participant group except to the extent taken into account in paragraph
(1) above.
(3) If a Participant is required to be aggregated as a member of
more than one family group in a plan, all Participants who are members
of those family groups that include the Participant are aggregated as
one family group in accordance with paragraphs (1) and (2) above.
(d) For the purposes of Sections 4.5(a) and 4.6, a Highly Compensated
Participant and a Non-Highly Compensated Participant shall include any
Employee eligible to make a deferral election pursuant to Section 4.2,
whether or not such deferral election was made or suspended pursuant to
Section 4.2.
(e) For the purposes of this Section and Code Sections 401(a)(4),
410(b) and 401(k), if two or more plans which include cash or deferred
arrangements are considered one plan for the purposes of Code Section
401(a)(4) or 410(b) (other than Code Section 410(b)(2)(A)(ii)as in effect
for Plan Years beginning after December 31, 1988), the cash or deferred
arrangements included in such plans shall be treated as one arrangement. In
addition, two or more cash or deferred arrangements may be considered as a
single arrangement for purposes of determining whether or not such
arrangements satisfy Code Sections 401(a)(4), 410(b) and 401(k). In such a
case, the cash or deferred arrangements included in such plans and the
plans including such arrangements shall be treated as one arrangement and
as one plan for purposes of this Section and Code Sections 401(a)(4),
410(b) and 401(k). Plans may be aggregated under this paragraph (e) only if
they have the same plan year.
44
<PAGE>
Notwithstanding the above, for Plan Years beginning after December 31,
1988, an employee stock ownership plan described in Code Section 4975(e)(7)
or 409 may not be combined with this Plan for purposes of determining
whether the employee stock ownership plan or this Plan satisfies this
Section and Code Sections 401(a)(4), 410(b) and 401(k).
(f) For the purposes of this Section, if a Highly Compensated
Participant is a Participant under two or more cash or deferred
arrangements (other than a cash or deferred arrangement which is part of an
employee stock ownership plan as defined in Code Section 4975(e)(7) or 409
for Plan Years beginning after December 31, 1988) of the Employer or an
Affiliated Employer, all such cash or deferred arrangements shall be
treated as one cash or deferred arrangement for the purpose of determining
the actual deferral ratio with respect to such Highly Compensated
Participant. However, for Plan Years beginning after December 31, 1988, if
the cash or deferred arrangements have different plan years, this paragraph
shall be applied by treating all cash or deferred arrangements ending with
or within the same calendar year as a single arrangement.
4.6 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS
In the event that the initial allocations of the Employer's Elective
Contributions made pursuant to Section 4.4 do not satisfy one of the tests set
forth in Section 4.5(a) for Plan Years beginning after December 31, 1986, the
Administrator shall adjust Excess Contributions pursuant to the options set
forth below:
(a) On or before the fifteenth day of the third month following the
end of each Plan Year, the Highly Compensated Participant having the
highest actual deferral ratio shall have his portion of Excess
Contributions distributed to him until one of the tests set forth in
Section 4.5(a) is satisfied, or until his actual deferral ratio equals the
actual deferral ratio of the Highly Compensated Participant having the
second highest actual deferral ratio. This process shall continue until one
of the tests set forth in Section 4.5(a) is satisfied. For each Highly
Compensated Participant, the amount of Excess Contributions is equal to
the Elective contributions on behalf of such Highly Compensated Participant
(determined prior to the
45
<PAGE>
application of this paragraph) minus the amount determined by multiplying
the Highly Compensated Participant's actual deferral ratio (determined
after application of this paragraph) by his "414(s) Compensation". However,
in determining the amount of Excess Contributions to be distributed with
respect to an affected Highly Compensated Participant as determined herein,
such amount shall be reduced by any Excess Deferred Compensation previously
distributed to such affected Highly Compensated Participant for his taxable
year ending with or within such Plan Year and any matching contributions
which relate to such Excess Deferred Compensation.
(1) With respect to the distribution of Excess Contributions
pursuant to (a) above, such distribution:
(i) may be postponed but not later than the close of the
Plan Year following the Plan Year to which they are allocable;
(ii) shall be made first from unmatched Deferred
Compensation and, thereafter, simultaneously from Deferred
Compensation which is matched and matching contributions which
relate to such Deferred Compensation;
(iii) shall be made from Qualified Non-Elective
contributions only to the extent that Excess Contributions exceed
the balance in the Participant's Elective Account attributable to
Deferred compensation and Employer matching contributions made
pursuant to Section 4.1(b);
(iv) shall be adjusted for Income; and
(v) shall be designated by the Employer as a distribution of
Excess Contributions (and Income).
(2) Any distribution of less than the entire amount of Excess
contributions shall be treated as a pro rata distribution of Excess
contributions and Income.
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<PAGE>
(3) The determination and correction of Excess Contributions of a
Highly Compensated Participant whose actual deferral ratio is
determined under the family aggregation rules shall be accomplished by
reducing the actual deferral ratio as required herein, and the Excess
Contributions for the family unit shall then be allocated among the
Family Members in proportion to the Elective Contributions of each
Family Member that were combined to determine the group actual
deferral ratio. Notwithstanding the foregoing, with respect to Plan
Years beginning prior to January 1, 1990, compliance with the
Regulations then in effect shall be deemed to be compliance with this
paragraph.
(b) Within twelve (12) months after the end of the Plan Year, the
Employer may make a special Qualified Non-Elective Contribution on behalf
of Non-Highly Compensated Participants in an amount sufficient to satisfy
one of the tests set forth in Section 4.5(a). Such contribution shall be
allocated to the Participant's Elective Account of each Non-Highly
Compensated Participant in the same proportion that each Non-Highly
Compensated Participant's Compensation for the year bears to the total
Compensation of all Non-Highly Compensated Participants.
(c) If during a Plan Year the projected aggregate amount of Elective
Contributions to be allocated to all Highly Compensated Participants under
this Plan would, by virtue of the tests set forth in Section 4.5(a), cause
the Plan to fail such tests, then the Administrator may automatically
reduce proportionately or in the order provided in Section 4.6(a) each
affected Highly Compensated Participant's deferral election made pursuant
to Section 4.2 by an amount necessary to satisfy one of the tests set forth
in Section 4. 5 (a).
4.7 MAXIMUM ANNUAL ADDITIONS
(a) Notwithstanding the foregoing, the maximum "annual additions"
credited to a Participant's accounts for any "limitation year" shall equal
the lesser of: (1) $30,000 (or, if greater, one-fourth of the dollar
limitation in effect under Code Section 415(b)(1)(A)) or (2) twenty-five
percent (25%) of the Participant's "415 Compensation" for such "limitation
year". For any
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short "limitation year", the dollar limitation in (1) above shall be
reduced by a fraction, the numerator of which is the number of full months
in the short "limitation year" and the denominator of which is twelve (12).
(b) For purposes of applying the limitations of Code Section 415,
"annual additions" means the sum credited to a Participant's accounts for
any "limitation year" of (1) Employer contributions, (2) Employee
contributions, (3) forfeitures, (4) amounts allocated, after March 31,
1984, to an individual medical account, as defined in Code Section
415(l)(2) which is part of a pension or annuity plan maintained by the
Employer and (5) amounts derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated to the separate
account of a key employee (as defined in Code Section 419A(d)(3)) under a
welfare benefit plan (as defined in Code Section 419(e)) maintained by the
Employer. Except, however, the "415 Compensation" percentage limitation
referred to in paragraph (a)(2) above shall not apply to: (1) any
contribution for medical benefits (within the meaning of Code Section
419A(f)(2)) after separation from service which is otherwise treated as an
"annual addition", or (2) any amount otherwise treated as an "annual
addition" under Code Section 415(l)(1).
(c) For purposes of applying the limitations of Code Section 415, the
transfer of funds from one qualified plan to another is not an "annual
addition". In addition, the following are not Employee contributions for
the purposes of Section 4.7(b)(2): (1) rollover contributions (as defined
in Code Sections 402(a)(5), 403(a)(4), 403(b)(8) and 408(d)(3)); (2)
repayments of loans made to a Participant from the Plan; (3) repayments of
distributions received by an Employee pursuant to Code Section 411(a)(7)(B)
(cash-outs); (4) repayments of distributions received by an Employee
pursuant to Code Section 411(a)(3)(D) (mandatory contributions); and (5)
Employee contributions to a simplified employee pension excludable from
gross income under Code Section 408(k)(6).
(d) For purposes of applying the limitations of Code Section 415, the
"limitation year" shall be the Plan Year.
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(e) The dollar limitation under Code Section 415(b)(1)(A) stated in
paragraph (a)(1) above shall be adjusted annually as provided in Code
Section 415(d) pursuant to the Regulations. The adjusted limitation is
effective as of January 1st of each calendar year and is applicable to
"limitation years" ending with or within that calendar year.
(f) For the purpose of this Section, all qualified defined benefit
plans (whether terminated or not) ever maintained by the Employer shall be
treated as one defined benefit plan, and all qualified defined contribution
plans (whether terminated or not) ever maintained by the Employer shall be
treated as one defined contribution plan.
(g) For the purpose of this Section, if the Employer is a member of
a controlled group of corporations, trades or businesses under common
control (as defined by Code Section 1563(a) or Code Section 414(b) and (c)
as modified by code Section 415(h)), is a member of an affiliated service
group (as defined by Code Section 414(m)), or is a member of a group of
entities required to be aggregated pursuant to Regulations under Code
Section 414(o), all Employees of such Employers shall be considered to be
employed by a single Employer.
(h) For the purpose of this Section, if this Plan is a Code Section
413(c) plan, all Employers of a Participant who maintain this Plan will be
considered to be a single Employer.
(i)(1) If a Participant participates in more than one defined
contribution plan maintained by the Employer which have different
Anniversary Dates, the maximum "annual additions" under this Plan shall
equal the maximum "annual additions" for the "limitation year" minus any
"annual additions" previously credited to such Participant's accounts
during the "limitation year".
(2) If a Participant participates in both a defined contribution
plan subject to Code Section 412 and a defined contribution plan not
subject to Code Section 412 maintained by the Employer which have the
same Anniversary Date, "annual additions" will be credited to the
Participant's accounts under the defined contribution plan
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subject to Code Section 412 prior to crediting "annual additions" to
the Participant's accounts under the defined contribution plan not
subject to Code Section 412.
(3) If a Participant participates in more than one defined
contribution plan not subject to Code Section 412 maintained by the
Employer which have the same Anniversary Date, the maximum "annual
additions" under this Plan shall equal the product of (A) the maximum
"annual additions" for the "limitation year" minus any "annual
additions" previously credited under subparagraphs (1) or (2) above,
multiplied by (B) a fraction (i) the numerator of which is the "annual
additions" which would be credited to such Participant's accounts
under this Plan without regard to the limitations of Code Section 415
and (ii) the denominator of which is such "annual additions" for all
plans described in this subparagraph.
(j) If an Employee is (or has been) a Participant in one or more
defined benefit plans and one or more defined contribution plans maintained
by the Employer, the sum of the defined benefit plan fraction and the
defined contribution plan fraction for any "limitation year" may not exceed
1.0.
(k) The defined benefit plan fraction for any "limitation year" is a
fraction, the numerator of which is the sum of the Participant's projected
annual benefits under all the defined benefit plans (whether or not
terminated) maintained by the Employer, and the denominator of which is the
lesser of 125 percent of the dollar limitation determined for the
"limitation year" under Code Sections 415(b) and (d) or 140 percent of the
highest average compensation, including any adjustments under Code Section
415(b).
Notwithstanding the above, if the Participant was a Participant as of
the first day of the first "limitation year" beginning after December 31,
1986, in one or more defined benefit plans maintained by the Employer which
were in existence on May 6, 1986, the denominator of this fraction will not
be less than 125 percent of the sum of the annual benefits under such plans
which the Participant had accrued as of the close of the last "limitation
year"
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beginning before January 1, 1987, disregarding any changes in the terms and
conditions of the plan after May 5, 1986. The preceding sentence applies
only if the defined benefit plans individually and in the aggregate
satisfied the requirements of Code Section 415 for all "limitation years"
beginning before January 1, 1987.
(1) The defined contribution plan fraction for any "limitation year"
is a fraction, the numerator of which is the sum of the annual additions to
the Participant's Account under all the defined contribution plans (whether
or not terminated) maintained by the Employer for the current and all prior
"limitation years" (including the annual additions attributable to the
Participant's nondeductible Employee contributions to all defined benefit
plans, whether or not terminated, maintained by the Employer, and the
annual additions attributable to all welfare benefit funds, as defined in
Code Section 419(e), and individual medical accounts, as defined in Code
Section 415(l)(2), maintained by the Employer), and the denominator of
which is the sum of the maximum aggregate amounts for the current and all
prior "limitation years" of service with the Employer (regardless of
whether a defined contribution plan was maintained by the Employer). The
maximum aggregate amount in any "limitation year" is the lesser of 125
percent of the dollar limitation determined under Code Sections 415(b) and
(d) in effect under Code Section 415(c)(1)(A) or 35 percent of the
Participant's Compensation for such year.
If the Employee was a Participant as of the end of the first day of
the first "limitation year" beginning after December 31, 1986, in one or
more defined contribution plans maintained by the Employer which were in
existence on May 6, 1986, the numerator of this fraction will be adjusted
if the sum of this fraction and the defined benefit fraction would
otherwise exceed 1.0 under the terms of this Plan. Under the adjustment, an
amount equal to the product of (1) the excess of the sum of the fractions
over 1.0 times (2) the denominator of this fraction, will be permanently
subtracted from the numerator of this fraction. The adjustment is
calculated using the fractions as they would be computed as of the end of
the last "limitation year" beginning before January 1, 1987, and
disregarding any changes in the terms and conditions of the Plan made after
May 5, 1986, but
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using the Code Section 415 limitation applicable to the first "limitation
year" beginning on or after January 1, 1987. The annual addition for any
"limitation year" beginning before January 1, 1987 shall not be recomputed
to treat all Employee contributions as annual additions.
(m) Notwithstanding the foregoing, for any "limitation year" in which
the Plan is a Top Heavy Plan, 100 percent shall be substituted for 125
percent in Sections 4.7(k) and 4.7(l) unless the extra minimum allocation
is being provided pursuant to Section 4.4. However, for any "limitation
year" in which the Plan is a Super Top Heavy Plan, 100 percent shall be
substituted for 125 percent in any event.
(n) Notwithstanding anything contained in this Section to the
contrary, the limitations, adjustments and other requirements prescribed in
this Section shall at all times comply with the provisions of Code Section
415 and the Regulations thereunder, the terms of which are specifically
incorporated herein by reference.
4.8 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS
(a) If, as a result of the allocation of Forfeitures, a reasonable
error in estimating a Participant's Compensation, a reasonable error in
determining the amount of elective deferrals (within the meaning of Code
Section 402(g)(3)) that may be made with respect to any Participant under
the limits of Section 4.7 or other facts and circumstances to which
Regulation 1.415-6(b)(6) shall be applicable, the "annual additions" under
this Plan would cause the maximum "annual additions" to be exceeded for any
Participant, the Administrator shall (1) distribute any elective deferrals
(within the meaning of Code Section 402(g)(3)) or return any voluntary
Employee contributions credited for the "limitation year" to the extent
that the return would reduce the "excess amount" in the Participant's
accounts (2) hold any "excess amount" remaining after the return of any
elective deferrals or voluntary Employee contributions in a "Section 415
suspense account" (3) use the "Section 415 suspense account" in the next
"limitation year" (and succeeding "limitation years" if necessary) to
reduce Employer contributions for that Participant if that Participant is
covered by the Plan as of the end of the "limitation year", or if the
Participant is not so
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covered, allocate and reallocate the "Section 415 suspense account" in the
next "limitation year" (and succeeding "limitation years" if necessary) to
all Participants in the Plan before any Employer or Employee contributions
which would constitute "annual additions" are made to. the Plan for
such"limitation year" (4) reduce Employer contributions to the Plan for
such "limitation year" by the amount of the "Section 415 suspense account"
allocated and reallocated during such "limitation year".
(b) For purposes of this Article, "excess amount" for any Participant
for a "limitation year" shall mean the excess, if any, of (1) the "annual
additions" which would be credited to his account under the terms of the
Plan without regard to the limitations of Code Section 415 over (2) the
maximum "annual additions" determined pursuant to Section 4.7.
(c) For purposes of this Section, "Section 415 suspense account" shall
mean an unallocated account equal to the sum of "excess amounts" for all
Participants in the Plan during the "limitation year". The "Section 415
suspense account" shall not share in any earnings or losses of the Trust
Fund.
(d) The Plan may not distribute "excess amounts", other than voluntary
Employee contributions, to Participants or Former Participants.
4.9 TRANSFERS FROM QUALIFIED PLANS
(a) With the consent of the Administrator, amounts may be transferred
from other qualified plans by Employees, provided that the trust from which
such funds are transferred permits the transfer to be made and the transfer
will not jeopardize the tax exempt status of the Plan or Trust or create
adverse tax consequences for the Employer. The amounts transferred shall be
set up in a separate account herein referred to as a "Participant's
Rollover Account". Such account shall be fully Vested at all times and
shall not be subject to Forfeiture for any reason.
(b) Amounts in a Participant's Rollover Account shall be held by the
Trustee pursuant to the provisions of this Plan and may not be withdrawn
by, or distributed to the Participant, in whole or in part, except as
provided in paragraphs (c) and (d) of this Section.
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(c) Except as permitted by Regulations (including Regulation
1.411(d)-4), amounts attributable to elective contributions (as defined in
Regulation 1.401(k)-l(g)(3)), including amounts treated as elective
contributions, which are transferred from another qualified plan in a
plan-to-plan transfer shall be subject to the distribution limitations
provided for in Regulation 1.401(k)-l(d).
(d) At Normal Retirement Date, or such other date when the Participant
or his Beneficiary shall be entitled to receive benefits, the fair market
value of the Participant's Rollover Account shall be used to provide
additional benefits to the Participant or his Beneficiary. Any
distributions of amounts held in a Participant's Rollover Account shall be
made in a manner which is consistent with and satisfies the provisions of
Section 6.5, including, but not limited to, all notice and consent
requirements of Code Section 411(a)(11) and the Regulations thereunder.
Furthermore, such amounts shall be considered as part of a Participant's
benefit in determining whether an involuntary cash-out of benefits without
Participant consent may be made.
(e) The Administrator may direct that employee transfers made after a
valuation date be segregated into a separate account for each Participant
in a federally insured savings account, certificate of deposit in a bank or
savings and loan association, money market certificate, or other short term
debt security acceptable to the Trustee until such time as the allocations
pursuant to this Plan have been made, at which time they may remain
segregated or be invested as part of the general Trust Fund, to be
determined by the Administrator.
(f) All amounts allocated to a Participant's Rollover Account may be
treated as a Directed Investment Account pursuant to Section 4.10.
(g) For purposes of this Section, the term "qualified plan" shall mean
any tax qualified plan under Code Section 401(a). The term "amounts
transferred from other qualified plans" shall mean: (i) amounts transferred
to this Plan directly from another qualified plan; (ii) lump-sum
distributions received by an Employee from another qualified plan which are
eligible for tax free rollover to a qualified
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plan and which are transferred by the Employee to this Plan within sixty
(60) days following his receipt thereof; (iii) amounts transferred to this
Plan from a conduit individual retirement account provided that the conduit
individual retirement account has no assets other than assets which (A)
were previously distributed to the Employee by another qualified plan as a
lump-sum distribution (B) were eligible for tax-free rollover to a
qualified plan and (C) were deposited in such conduit individual retirement
account within sixty (60) days of receipt thereof and other than earnings
on said assets; and (iv) amounts distributed to the Employee from a conduit
individual retirement account meeting the requirements of clause (iii)
above, and transferred by the Employee to this Plan within sixty (60) days
of his receipt thereof from such conduit individual retirement account.
(h) Prior to accepting any transfers to which this Section applies,
the Administrator may require the Employee to establish that the amounts to
be transferred to this Plan meet the requirements of this Section and may
also require the Employee to provide an opinion of counsel satisfactory to
the Employer that the amounts to be transferred meet the requirements of
this Section.
(i) This Plan shall not accept any direct or indirect transfers (as
that term is defined and interpreted under Code Section 401(a)(11) and the
Regulations thereunder) from a defined benefit plan, money purchase plan
(including a target benefit plan), stock bonus or profit sharing plan which
would otherwise have provided for a life annuity form of payment to the
Participant.
(j) Notwithstanding anything herein to the contrary, a transfer
directly to this Plan from another qualified plan (or a transaction having
the effect of such a transfer) shall only be permitted if it will not
result in the elimination or reduction of any "Section 411(d)(6) protected
benefit" as described in Section 8.1.
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4.10 DIRECTED INVESTMENT ACCOUNT
(a) The Administrator, in his sole discretion, may determine that all
Participants be permitted to direct the Trustee as to the investment of all
or a portion of the interest in any one or more of their individual account
balances. If such authorization is given, Participants may, subject to a
procedure established by the Administrator and applied in a uniform
nondiscriminatory manner, direct the Trustee in writing to invest any
portion of their account in specific assets, specific funds or other
investments permitted under the Plan and the directed investment procedure.
That portion of the account of any Participant so directing will thereupon
be considered a Directed Investment Account, which shall not share in Trust
Fund earnings.
(b) A separate Directed Investment Account shall be established for
each Participant who has directed an investment. Transfers between the
Participant's regular account and his Directed Investment Account shall be
charged and credited as the case may be to each account. The Directed
Investment Account shall not share in Trust Fund earnings, but it shall be
charged or credited as appropriate with the net earnings, gains, losses and
expenses as well as any appreciation or depreciation in market value during
each Plan Year attributable to such account.
ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND
The Administrator shall direct the Trustee, as of each Anniversary Date,
and at such other date or dates deemed necessary by the Administrator, herein
called "valuation date", to determine the net worth of the assets comprising the
Trust Fund as it exists on the "valuation date." In determining such net worth,
the Trustee shall value the assets comprising the Trust Fund at their fair
market value as of the "valuation date" and shall deduct all expenses for which
the Trustee has not yet obtained reimbursement from the Employer or the Trust
Fund.
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5.2 METHOD OF VALUATION
In determining the fair market value of securities held in the Trust Fund
which are listed on a registered stock exchange, the Administrator shall direct
the Trustee to value the same at the prices they were last traded on such
exchange preceding the close of business on the "valuation date". If such
securities were not traded on the "valuation date", or if the exchange on which
they are traded was not open for business on the "valuation date", then the
securities shall be valued at the prices at which they were last traded prior to
the "valuation date". Any unlisted security held in the Trust Fund shall be
valued at its bid price next preceding the close of business on the "valuation
date", which bid price shall be obtained from a registered broker or an
investment banker. In determining the fair market value of assets other than
securities for which trading or bid prices can be obtained, the Trustee may
appraise such assets itself, or in its discretion, employ one or more appraisers
for that purpose and rely on the values established by such appraiser or
appraisers.
ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT
Every Participant may terminate his employment with the Employer and retire
for the purposes hereof on his Normal Retirement Date. However, a Participant
may postpone the termination of his employment with the Employer to a later
date, in which event the participation of such Participant in the Plan,
including the right to receive allocations pursuant to Section 4.4, shall
continue until his Late Retirement Date. Upon a Participant's Retirement Date or
attainment of his Normal Retirement Date without termination of employment with
the Employer, or as soon thereafter as is practicable, the Trustee shall
distribute all amounts credited to such Participant's Combined Account in
accordance with Section 6.5.
6.2 DETERMINATION OF BENEFITS UPON DEATH
(a) Upon the death of a Participant before his Retirement Date or
other termination of his employment, all amounts credited to such
Participant's Combined Account shall become fully Vested. The Administrator
direct the Trustee, in accordance with the provisions of Sections 6.6 and
6.7, to distribute the value of the deceased Participant's accounts to the
Participant's Beneficiary.
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(b) Upon the death of a Former Participant, the Administrator shall
direct the Trustee, in accordance with the provisions of Sections 6.6 and
6.7, to distribute any remaining Vested amounts credited to the accounts of
a deceased Former Participant to such Former Participant's Beneficiary.
(c) Any security interest held by the Plan by reason of an outstanding
loan to the Participant or Former Participant shall be taken into account
in determining the amount of the death benefit.
(d) The Administrator may require such proper proof of death and such
evidence of the right of any person to receive payment of the value of the
account of a deceased Participant or Former Participant as the
Administrator may deem desirable. The Administrator's determination of
death and of the right of any person to receive payment shall be
conclusive.
(e) The Beneficiary of the death benefit payable pursuant to this
Section shall be the Participant's spouse. Except, however, the Participant
may designate a Beneficiary other than his spouse if:
(1) the spouse has waived the right to be the Participant's
Beneficiary, or
(2) the Participant is legally separated or has been abandoned
(within the meaning of local law) and the Participant has a court
order to such effect (and there is no "qualified domestic relations
order" as defined in Code Section 414(p) which provides otherwise), or
(3) the Participant has no spouse, or
(4) the spouse cannot be located.
In such event, the designation of a Beneficiary shall be made on a
form satisfactory to the Administrator. A Participant may at any time
revoke his designation of a Beneficiary or change his Beneficiary by filing
written notice of such revocation or change with the Administrator.
However, the Participant's spouse must again consent in writing to any
change in Beneficiary unless the original consent acknowledged that the
spouse had the right to limit consent only to a specific Beneficiary and
that the spouse voluntarily
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elected to relinquish such right. In the event no valid designation of
Beneficiary exists at the time of the Participant's death, the death
benefit shall be payable to his estate.
(f) Any consent by the Participant's spouse to waive any rights to the
death benefit must be in writing, must acknowledge the effect of such
waiver, and be witnessed by a Plan representative or a notary public.
Further, the spouse's consent must be irrevocable and must acknowledge the
specific nonspouse Beneficiary.
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY
In the event of a Participant's Total and Permanent Disability prior to his
Retirement Date or other termination of his employment, all amounts credited to
such Participant's Combined Account shall become fully Vested. In the event of a
Participant's Total and Permanent Disability, the Trustee, in accordance with
the provisions of Sections 6.5 and 6.7, shall distribute to such Participant all
amounts credited to such Participant's Combined Account as though he had
retired.
6.4 DETERMINATION OF BENEFITS UPON TERMINATION
(a) On or before the Anniversary Date coinciding with or subsequent to
the termination of a Participant's employment for any reason other than
death, Total and Permanent Disability or retirement, the Administrator may
direct the Trustee to segregate the amount of the Vested portion of such
Terminated Participant's Combined Account and invest the aggregate amount
thereof in a separate, federally insured savings account, certificate of
deposit, common or collective trust fund of a bank or a deferred annuity.
In the event the Vested portion of a Participant's Combined Account is not
segregated, the amount shall remain in a separate account for the
Terminated Participant and share in allocations pursuant to Section 4.4
until such time as a distribution is made to the Terminated Participant.
Distribution of the funds due to a Terminated Participant shall be
made on the occurrence of an event which would result in the distribution
had the Terminated Participant remained in the employ of the Employer
(upon the Participant's death, Total and Permanent Disability or Normal
Retirement). However, at
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the election of the Participant, the Administrator shall direct the Trustee
to cause the entire Vested portion of the Terminated Participant's Combined
Account to be payable to such Terminated Participant on or after the
quarterly valuation following termination of employment. Any distribution
under this paragraph shall be made in a manner which is consistent with and
satisfies the provisions of Section 6.5, including, but not limited to, all
notice and consent requirements of Code Section 411(a)(11) and the
Regulations thereunder.
If the value of a Terminated Participant's Vested benefit derived from
Employer and Employee contributions does not exceed $3,500 and has never
exceeded $3,500 at the time of any prior distribution, the Administrator
shall direct the Trustee to cause the entire Vested benefit to be paid to
such Participant in a single lump sum.
For purposes of this Section 6.4, if the value of a Terminated
Participant's Vested benefit is zero, the Terminated Participant shall be
deemed to have received a distribution of such Vested benefit.
(b) The Vested portion of any Participant's Account shall be a
percentage of the total amount credited to his Participant's Account
determined on the basis of the Participant's number of Years of Service
according to the following schedule:
Vesting Schedule
----------------
Years of Service Percentage
---------------- ----------
Less than 2 0%
2 20%
3 40%
4 60%
5 80%
6 100%
(c) Notwithstanding the vesting schedule above, the Vested percentage
of a Participant's Account shall not be less than the Vested percentage
attained as of the later of the effective date or adoption date of this
amendment and restatement.
(d) Notwithstanding the vesting schedule above, upon the complete
discontinuance of the Employer's contributions to the Plan or upon any full
or partial
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termination of the Plan, all amounts credited to the account of any
affected Participant shall become 100% Vested and shall not thereafter be
subject to Forfeiture.
(e) The computation of a Participant's nonforfeitable percentage of
his interest in the Plan shall not be reduced as the result of any direct
or indirect amendment to this Plan. For this purpose, the Plan shall be
treated as having been amended if the Plan provides for an automatic change
in vesting due to a change in top heavy status. In the event that the Plan
is amended to change or modify any vesting schedule, a Participant with at
least three (3) Years of Service as of the expiration date of the election
period may elect to have his nonforfeitable percentage computed under the
Plan without regard to such amendment. If a Participant fails to make such
election, then such Participant shall be subject to the new vesting
schedule. The Participant's election period shall commence on the adoption
date of the amendment and shall end 60 days after the latest of:
(1) the adoption date of the amendment,
(2) the effective date of the amendment, or
(3) the date the Participant receives written notice of the
amendment from the Employer or Administrator.
(f)(1) if any Former Participant shall be reemployed by the Employer
before a 1-Year Break in Service occurs, he shall continue to participate
in the Plan in the same manner as if such termination had not occurred.
(2) If any Former Participant shall be reemployed by the Employer
before five (5) consecutive 1-Year Breaks in Service, and such Former
Participant had received, or was deemed to have received, a
distribution of his entire Vested interest prior to his reemployment,
his forfeited account shall be reinstated only if he repays the full
amount distributed to him before the earlier of five (5) years after
the first date on which the Participant is subsequently reemployed by
the Employer or the close of the first period of five (5) consecutive
1-Year
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Breaks in Service commencing after the distribution, or in the event
of a deemed distribution, upon the reemployment of such Former
Participant. In the event the Former Participant does repay the full
amount distributed to him, or in the event of a deemed distribution,
the undistributed portion of the Participant's Account must be
restored in full, unadjusted by any gains or losses occurring
subsequent to the Anniversary Date or other valuation date coinciding
with or preceding his termination. The source for such reinstatement
shall first be any Forfeitures occurring during the year. If such
source is insufficient, then the Employer shall contribute an amount
which is sufficient to restore any such forfeited Accounts provided,
however, that if a discretionary contribution is made for such year
pursuant to Section 4.1(d), such contribution shall first be applied
to restore any such Accounts and the remainder shall be allocated in
accordance with Section 4.4.
(3)If any Former Participant is reemployed after a 1-Year Break
in Service has occurred, Years of Service shall include Years of
Service prior to his 1-Year Break in Service subject to the following
rules:
(i) If a Former Participant has a 1-Year Break in Service,
his pre-break and post-break service shall be used for computing
Years of Service for eligibility and for vesting purposes only
after he has been employed for one (1) Year of Service following
the date of his reemployment with the Employer;
(ii) Any Former Participant who under the Plan does not have
a nonforfeitable right to any interest in the Plan resulting from
Employer contributions shall lose credits otherwise allowable
under (i) above if his consecutive 1-Year Breaks in Service equal
or exceed the greater of (A) five (5) or (B) the aggregate number
of his pre-break Years of Service;
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(iii) After five (5) consecutive 1-Year Breaks in Service, a
Former Participant's Vested Account balance attributable to
pre-break service shall not be increased as a result of
post-break service;
(iv) If a Former Participant who has not had his Years of
Service before a 1-Year Break in Service disregarded pursuant to
(ii) above completes one (1) Year of Service for eligibility
purposes following his reemployment with the Employer, he shall
participate in the Plan retroactively from his date of
reemployment;
(v) If a Former Participant who has not had his Years of
Service before a 1-Year Break in Service disregarded pursuant to
(ii) above completes a Year of Service (a 1-Year Break in Service
previously occurred, but employment had not terminated), he shall
participate in the Plan retroactively from the first day of the
Plan Year during which he completes one (1) Year of Service.
6.5 DISTRIBUTION OF BENEFITS
(a) The Administrator, pursuant to the election of the Participant,
shall direct the Trustee to distribute to a Participant or his Beneficiary
any amount to which he is entitled under the Plan in one or more of the
following methods:
(1) one lump-sum payment in cash or in property;
(2) Payments over a period certain in monthly, quarterly,
semiannual, or annual cash installments. In order to provide such
installment payments, the Administrator may (A) segregate the
aggregate amount thereof in a separate, federally insured savings
account, certificate of deposit in a bank or savings and loan
association, money market certificate or other liquid short-term
security or (B) purchase a nontransferable annuity contract for a term
certain (with no life contingencies) providing for such payment. The
period over which such payment is to be made shall not extend beyond
the Participant's life expectancy (or the life
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expectancy of the Participant and his designated Beneficiary).
(b) Any distribution to a Participant who has a benefit which exceeds,
or has ever exceeded, $3,500 at the time of any prior distribution shall
require such Participant's consent if such distribution commences prior to
the later of his Normal Retirement Age or age 62. With regard to this
required consent:
(1) The Participant must be informed of his right to defer
receipt of the distribution. If a Participant fails to consent, it
shall be deemed an election to defer the commencement of payment of
any benefit. However, any election to defer the receipt of benefits
shall not apply with respect to distributions which are required under
Section 6.5(c).
(2) Notice of the rights specified under this paragraph shall be
provided no less than 30 days and no more than 90 days before the
first day on which all events have occurred which entitle the
Participant to such benefit.
(3) Written consent of the Participant to the distribution must
not be made before the Participant receives the notice and must not be
made more than 90 days before the first day on which all events have
occurred which entitle the Participant to such benefit.
(4) No consent shall be valid if a significant detriment is
imposed under the Plan on any Participant who does not consent to the
distribution.
(c) Notwithstanding any provision in the Plan to the contrary, the
distribution of a Participant's benefits shall be made in accordance with
the following requirements and shall otherwise comply with Code Section
401(a)(9) and the Regulations thereunder (including Regulation
1.401(a)(9)-2), the provisions of which are incorporated herein by
reference:
(1) A Participant's benefits shall be distributed to him not
later than April lst of the calendar year following the later of (i)
the calendar year in which the Participant attains
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age 70 1/2 or (ii) the calendar year in which the Participant retires,
provided, however, that this clause (ii) shall not apply in the case
of a Participant who is a "five (5) percent owner" at any time during
the five (5) Plan Year period ending in the calendar year in which he
attains age 70 1/2 or, in the case of a Participant who becomes a
"five (5) percent owner" during any subsequent Plan Year, clause (ii)
shall no longer apply and the required beginning date shall be the
April 1st of the calendar year following the calendar year in which
such subsequent Plan Year ends. Alternatively, distributions to a
Participant must begin no later than the applicable April 1st as
determined under the preceding sentence and must be made over a period
certain measured by the life expectancy of the Participant (or the
life expectancies of the Participant and his designated Beneficiary)
in accordance with Regulations. Notwithstanding the foregoing, clause
(ii) above shall not apply to any Participant unless the Participant
had attained age 70 1/2 before January 1, 1988 and was not a "five (5)
percent owner" at any time during the Plan Year ending with or within
the calendar year in which the Participant attained age 66 1/2 or any
subsequent Plan Year.
(2) Distributions to a Participant and his Beneficiaries shall
only be made in accordance with the incidental death benefit
requirements of Code Section 401(a)(9)(G) and the Regulations
thereunder.
Additionally, for calendar years beginning before 1989, distributions
may also be made under an alternative method which provides that the
then present value of the payments to be made over the period of the
Participant's life expectancy exceeds fifty percent (50%) of the then
present value of the total payments to be made to the Participant and
his Beneficiaries.
(d) For purposes of this Section, the life expectancy of a Participant
and a Participant's spouse may, at the election of the Participant or the
Participant's spouse, be redetermined in accordance with Regulations. The
election, once made, shall be irrevocable. If no election is made by the
time distributions must commence, then the life expectancy
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of the Participant and the Participant's spouse shall not be subject to
recalculation. Life expectancy and joint and last survivor expectancy shall
be computed using the return multiples in Tables V and VI of Regulation
1.72-9.
(e) All annuity Contracts under this Plan shall be non-transferable
when distributed. Furthermore, the terms of any annuity Contract purchased
and distributed to a Participant or spouse shall comply with all of the
requirements of the Plan.
(f) If a distribution is made at a time when a Participant is not
fully Vested in his Participant's Account (employment has not terminated)
and the Participant may increase the Vested percentage in such account:
(1) a separate account shall be established for the Participant's
interest in the Plan as of the time of the distribution; and
(2)at any relevant time, the Participant's Vested portion of the
separate account shall be equal to an amount ("X") determined by the
formula:
X equals P(AB plus (R x D)) - (R x D)
For purposes of applying the formula: P is the Vested percentage at
the relevant time, AB is the account balance at the relevant time, D
is the amount of distribution, and R is the ratio of the account
balance at the relevant time to the account balance after
distribution.
6.6 DISTRIBUTION OF BENEFITS UPON DEATH
(a)(l) The death benefit payable pursuant to Section 6.2 shall be paid
to the Participant's Beneficiary within a reasonable time after the
Participant's death by either of the following methods, as elected by the
Participant (or if no election has been made prior to the Participant's
death, by his Beneficiary) subject, however, to the rules specified in
Section 6.6(b):
(i) One lump-sum payment in cash or in property;
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(ii) Payment in monthly, quarterly, semi-annual, or annual
cash installments over a period to be determined by the
Participant or his Beneficiary. After periodic installments
commence, the Beneficiary shall have the right to direct the
Trustee to reduce the period over which such periodic
installments shall be made, and the Trustee shall adjust the cash
amount of such periodic installments accordingly.
(2) In the event the death benefit payable pursuant to Section
6.2 is payable in installments, then, upon the death of the
Participant, the Administrator may direct the Trustee to segregate the
death benefit into a separate account, and the Trustee shall invest
such segregated account separately, and the funds accumulated in such
account shall be used for the payment of the installments.
(b) Notwithstanding any provision in the Plan to the contrary,
distributions upon the death of a Participant shall be made in accordance
with the following requirements and shall otherwise comply with Code
Section 401(a)(9) and the Regulations thereunder. If it is determined
pursuant to Regulations that the distribution of a Participant's interest
has begun and the Participant dies before his entire interest has been
distributed to him, the remaining portion of such interest shall be
distributed at least as rapidly as under the method of distribution
selected pursuant to Section 6.5 as of his date of death. If a Participant
dies before he has begun to receive any distributions of his interest under
the Plan or before distributions are deemed to have begun pursuant to
Regulations, then his death benefit shall be distributed to his
Beneficiaries by December 31st of the calendar year in which the fifth
anniversary of his date of death occurs.
(c) For purposes of this Section, the life expectancy of a Participant
and a Participant's spouse may, at the election of the Participant or the
Participant's spouse, be redetermined in accordance with Regulations. The
election, once made, shall be irrevocable. If no election is made by the
time distributions must commence, then the life expectancy of the
Participant and the Participant's spouse shall not be subject to
recalculation. Life expectancy and joint and last survivor expectancy shall
be computed
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using the return multiples in Tables V and VI of Regulation 1.72-9.
6.7 TIME OF SEGREGATION OR DISTRIBUTION
Except as limited by Sections 6.5 and 6.6, whenever the Trustee is to make
a distribution or to commence a series of payments on or as of an Anniversary
Date, the distribution or series of payments may be made or begun on such date
or as soon thereafter as is practicable. However, unless a Former Participant
elects in writing to defer the receipt of benefits (such election may not result
in a death benefit that is more than incidental), the payment of benefits shall
begin not later than the 60th day after the close of the Plan Year in which the
latest of the following events occurs: (a) the date on which the Participant
attains the earlier of age 65 or the Normal Retirement Age specified herein; (b)
the 10th anniversary of the year in which the Participant commenced
participation in the Plan; or (c) the date the Participant terminates his
service with the Employer.
6.8 DISTRIBUTION FOR MINOR BENEFICIARY
In the event a distribution is to be made to a minor, then the
Administrator may direct that such distribution be paid to the legal guardian,
or if none, to a parent of such Beneficiary or a responsible adult with whom the
Beneficiary maintains his residence, or to the custodian for such Beneficiary
under the Uniform Gift to Minors Act or Gift to Minors Act, if such is permitted
by the laws of the state in which said Beneficiary resides. Such a payment to
the legal guardian, custodian or parent of a minor Beneficiary shall fully
discharge the Trustee, Employer, and Plan from further liability on account
thereof.
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN
In the event that all, or any portion, of the distribution payable to a
Participant or his Beneficiary hereunder shall, at the later of the
Participant's attainment of age 62 or his Normal Retirement Age, remain unpaid
solely by reason of the inability of the Administrator, after sending a
registered letter, return receipt requested, to the last known address, and
after further diligent effort, to ascertain the whereabouts of such Participant
or his Beneficiary, the amount so distributable shall be treated as a Forfeiture
pursuant to the Plan. In the event a Participant or Beneficiary is located
subsequent to his benefit being reallocated, such benefit shall be restored.
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6.10 ADVANCE DISTRIBUTION FOR HARDSHIP
(a) The Administrator, at the election of the Participant, shall
direct the Trustee to distribute to any Participant in any one Plan Year up
to the lesser of 100% of his Participant's Elective Account valued as of
the last Anniversary Date or other valuation date or the amount necessary
to satisfy the immediate and heavy financial need of the Participant. Any
distribution made pursuant to this Section shall be deemed to be made as of
the first day of the Plan Year or, if later, the valuation date immediately
preceding the date of distribution, and the Participant's Elective Account
shall be reduced accordingly. Withdrawal under this Section shall be
authorized only if the distribution is on account of:
(1) Expenses for medical care described in Code Section 213(d)
previously incurred by the Participant, his spouse, or any of his
dependents (as defined in Code Section 152) or necessary for these
persons to obtain medical care;
(2) The costs directly related to the purchase of a principal
residence for the Participant (excluding mortgage payments);
(3) Payment of tuition and related educational fees for the next
twelve (12) months of post-secondary education for the Participant,
his spouse, children, or dependents; or
(4) Payments necessary to prevent the eviction of the Participant
from his principal residence or foreclosure on the mortgage of, the
Participant's principal residence.
(b) No distribution shall be made pursuant to this Section unless the
Administrator, based upon the Participant's representation and such other
facts as are known to the Administrator, determines that all of the
following conditions are satisfied:
(1) The distribution is not in excess of the amount of the
immediate and heavy financial need of the Participant. The amount of
the immediate and heavy financial need may include any amounts
necessary to pay any federal, state, or local income taxes or
penalties reasonably anticipated to result from the distribution;
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(2) The Participant has obtained all distributions, other than
hardship distributions, and all nontaxable (at the time of the loan)
loans currently available under all plans maintained by the Employer;
(3) The Plan, and all other plans maintained by the Employer,
provide that the Participant's elective deferrals and voluntary
Employee contributions will be suspended for at least twelve (12)
months after receipt of the hardship distribution or, the Participant,
pursuant to a legally enforceable agreement, will suspend his elective
deferrals and voluntary Employee contributions to the Plan and all
other plans maintained by the Employer for at least twelve (12) months
after receipt of the hardship distribution; and
(4) The Plan, and all other plans maintained by the Employer,
provide that the Participant may not make elective deferrals for the
Participant's taxable year immediately following the taxable year of
the hardship distribution in excess of the applicable limit under Code
Section 402(g) for such, next taxable year less the amount of such,
Participant's elective deferrals for the taxable year of the hardship
distribution.
(c) Notwithstanding the above, for Plan Years beginning after December
31, 1988, distributions from the Participant's Elective Account pursuant to
this Section shall be limited, as of the date of distribution, to the
Participant's Elective Account as of the end of the last Plan Year ending
before July 1, 1989, plus the total Participant's Deferred Compensation
after such date, reduced by the amount of any previous distributions
pursuant to this Section.
(d) Any distribution made pursuant to this Section shall be made in a
manner which is consistent with and satisfies the provisions of Section
6.5, including, but not limited to, all notice and consent requirements of
Code Section 411(a)(11) and the Regulations thereunder.
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6.11 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION
All rights and benefits, including elections, provided to a Participant in
this Plan shall be subject to the rights afforded to any "alternate payee" under
a "qualified domestic relations order." Furthermore, a distribution to an
"alternate payee" shall be permitted if such distribution is authorized by a
"qualified domestic relations order," even if the affected Participant has not
separated from service and has not reached the "earliest retirement age" under
the Plan. For the purposes of this Section, "alternate payee," "qualified
domestic relations order" and "earliest retirement age" shall have the meaning
set forth under Code Section 414(p).
ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE
The Trustee shall have the following categories of responsibilities:
(a) Consistent with the "funding policy and method" determined by the
Employer, to invest, manage, and control the Plan assets subject, however,
to the direction of an Investment Manager if the Trustee should appoint
such manager as to all or a portion of the assets of the Plan;
(b) At the direction of the Administrator, to pay benefits required
under the Plan to be paid to Participants, or, in the event of their death,
to their Beneficiaries;
(c) To maintain records of receipts and disbursements and furnish to
the Employer and/or Administrator for each Plan Year a written annual
report perfection 7.7; and
(d) If there shall be more than one Trustee, they shall act by a
majority of their number, but may authorize one or more of them to sign
papers on their behalf.
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7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE
(a) The Trustee shall invest and reinvest the Trust Fund to keep the
Trust Fund invested without distinction between principal and income and in
such securities or property, real or personal, wherever situated, as the
Trustee shall deem advisable, including, but not limited to, stocks, common
or preferred, bonds and other evidences of indebtedness or ownership, and
real estate or any interest therein. The Trustee shall at all times in
making investments of the Trust Fund consider, among other factors, the
short and long-term financial needs of the Plan on the basis of information
furnished by the Employer. In making such investments, the Trustee shall
not be restricted to securities or other property of the character
expressly authorized by the applicable law for trust investments; however,
the Trustee shall give due regard to any limitations imposed by the Code or
the Act so that at all times the Plan may qualify as a qualified Profit
Sharing Plan and Trust.
(b) The Trustee may employ a bank or trust company pursuant to the
terms of its usual and customary bank agency agreement, under which the
duties of such bank or trust company shall be of a custodial, clerical and
record-keeping nature.
7.3 OTHER POWERS OF THE TRUSTEE
The Trustee, in addition to all powers and authorities under common law,
statutory authority, including the Act, and other provisions of the Plan, shall
have the following powers and authorities, to be exercised in the Trustee's sole
discretion:
(a) To purchase, or subscribe for, any securities or other property
and to retain the same. In conjunction with the purchase of securities,
margin accounts may be opened and maintained;
(b) To sell, exchange, convey, transfer, grant options to purchase, or
otherwise dispose of any securities or other property held by the Trustee,
by private contract or at public auction. No person dealing with the
Trustee shall be bound to see to the application of the purchase money or
to inquire into the validity, expediency, or propriety of any such sale or
other disposition, with or without advertisement;
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(c) To vote upon any stocks, bonds, or other securities; to give
general or special proxies or powers of attorney with or without power of
substitution; to exercise any conversion privileges, subscription rights or
other options, and to make any payments incidental thereto; to oppose, or
to consent to, or otherwise participate in, corporate reorganizations or
other changes affecting corporate securities, and to delegate discretionary
powers, and to pay any assessments or charges in connection therewith; and
generally to exercise any of the powers of an owner with respect to stocks,
bonds, securities, or other property;
(d) To cause any securities or other property to be registered in the
Trustee's own name or in the name of one or more of the Trustee's nominees,
and to hold any investments in bearer form, but the books and records of
the Trustee shall at all times show that all such investments are part of
the Trust Fund;
(e) To borrow or raise money for the purposes of the Plan in such
amount, and upon such terms and conditions, as the Trustee shall deem
advisable; and for any sum so borrowed, to issue a promissory note as
Trustee, and to secure the repayment thereof by pledging all, or any part,
of the Trust Fund; and no person lending money to the Trustee shall be
bound to see to the application of the money lent or to inquire into the
validity, expediency, or propriety of any borrowing;
(f) To keep such portion of the Trust Fund in cash or cash balances as
the Trustee may, from time to time, deem to be in the best interests of the
Plan, without liability for interest thereon;
(g) To accept and retain for such time as the Trustee may deem
advisable any securities or other property received or acquired as Trustee
hereunder, whether or not such securities or other property would normally
be purchased as investments hereunder;
(h) To make, execute, acknowledge, and deliver any and all documents
of transfer and conveyance and Any and all other instruments that may be
necessary or appropriate to carry out the powers herein granted;
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(i) To settle, compromise, or submit to arbitration any claims, debts,
or damages due or owing to or from the Plan, to commence or defend suits or
legal or administrative proceedings, and to represent the Plan in all suits
and legal and administrative proceedings;
(j) To employ suitable agents and counsel and to pay their reasonable
expenses and compensation, and such agent or counsel may or may not be
agent or counsel for the Employer;
(k) To apply for and procure from responsible insurance companies, to
be selected by the Administrator, as an investment of the Trust Fund such
annuity, or other Contracts (on the life of any Participant) as the
Administrator shall deem proper; to exercise, at any time or from time to
time, whatever rights and privileges may be granted under such annuity, or
other Contracts; to collect, receive, and settle for the proceeds of all
such annuity or other Contracts as and when entitled to do so under the
provisions thereof;
(1) To invest funds of the Trust in time deposits or savings accounts
bearing a reasonable rate of interest in the Trustee's bank;
(m) To invest in Treasury Bills and other forms of United States
government obligations;
(n) To invest in shares of investment companies registered under the
Investment Company Act of 1940;
(o) To sell, purchase and acquire put or call options if the options
are traded on and purchased through a national securities exchange
registered under the Securities Exchange Act of 1934, as amended, or, if
the options are not traded on a national securities exchange, are
guaranteed by a member firm of the New York Stock Exchange;
(p) To deposit monies in federally insured savings accounts or
certificates of deposit in banks or savings and loan associations;
(q) To pool all or any of the Trust Fund, from time to time, with
assets belonging to any other qualified employee pension benefit trust
created by the
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Employer or an affiliated company of the Employer, And to commingle such
assets and make joint or common investments and carry joint accounts on
behalf of this Plan and such other trust or trusts, allocating undivided
shares or interests in such investments or accounts or any pooled assets of
the two or more trusts in accordance with their respective interests;
(r) To do all such acts and exercise all such rights and privileges,
although not specifically mentioned herein, as the Trustee may deem
necessary to carry out the purposes of the Plan.
(s) Directed Investment Account. The powers granted to the Trustee
shall be exercised in the sole fiduciary discretion of the Trustee.
However, if Participants are so empowered by the Administrator, each
Participant may direct the Trustee to separate and keep separate all or a
portion of his account; and further each Participant is authorized and
empowered, in his sole and absolute discretion, to give directions to the
Trustee pursuant to the procedure established by the Administrator and in
such form as the Trustee may require concerning the investment of the
Participant's Directed Investment Account. The Trustee shall comply as
promptly as practicable with directions given by the Participant hereunder.
The Trustee may refuse to comply with any direction from the Participant in
the event the Trustee, in its sole and absolute discretion, deems such
directions improper by virtue of applicable law. The Trustee shall not be
responsible or liable for any loss or expense which may result from the
Trustee's refusal or failure to comply with any directions from the
Participant. Any costs and expenses related to compliance with the
Participant's directions shall be borne by the Participant's Directed
Investment Account.
7.4 LOANS TO PARTICIPANTS
(a) The Administrator may make loans to Participants and Beneficiaries
under the following circumstances: (1) loans shall be made available to all
Participants and Beneficiaries on a reasonably equivalent basis; (2) loans
shall not be made available to Highly Compensated Employees in an amount
greater than the amount made available to other Participants and
Beneficiaries; (3) loans shall bear a reasonable rate of interest; (4)
loans shall be adequately secured; and (5) shall provide for repayment over
a
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reasonable period of time.
(b) Loans made pursuant to this Section (when added to the outstanding
balance of all other loans made by the Plan to the Participant) shall be
limited to the lesser of:
(1) $50,000 reduced by the excess (if any) of the highest
outstanding balance of loans from the Plan to the Participant during
the one year period ending on the day before the date on which such
loan is made, over the outstanding balance of loans from the Plan to
the Participant on the date on which such loan was made, or
(2) one-half (1/2) of the present value of the non-forfeitable
accrued benefit of the Participant under the Plan.
For purposes of this limit, all plans of the Employer shall be
considered one plan.
(c) Loans shall provide for level amortization with payments to be
made not less frequently than quarterly over a period not to exceed five
(5) years. However, loans used to acquire any dwelling unit which, within a
reasonable time, is to be used (determined at the time the loan is made) as
a principal residence of the Participant shall provide for periodic
repayment over a reasonable period of time that may exceed five (5) years.
(d) Any loans granted or renewed on or after the last day of the first
Plan Year beginning after December 31, 1988 shall be made pursuant to a
Participant loan program. Such loan program shall be established in writing
and must include, but need not be limited to, the following:
(1) the identity of the person or positions authorized to
administer the Participant loan program;
(2) a procedure for applying for loans;
(3) the basis on which loans will be approved or denied;
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(4) limitations, if any, on the types and amounts of loans
offered;
(5) the procedure under the program for determining a reasonable
rate of interest;
(6) the types of collateral which may secure a Participant loan;
and
(7) the events constituting default and the steps that will be
taken to preserve Plan assets.
Such Participant loan program shall be contained in a separate written
document which, when properly executed, is hereby incorporated by reference
and made a part of the Plan. Furthermore, such Participant loan program may
be modified or amended in writing from time to time without the necessity
of amending this Section.
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS
At the direction of the Administrator, the Trustee shall, from time to
time, in accordance with the terms of the Plan, make payments out of the Trust
Fund. The Trustee shall not be responsible in any way for the application of
such payments.
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES
The Trustee shall be paid such reasonable compensation as shall from time
to time be agreed upon in writing by the Employer and the Trustee. An individual
serving as Trustee who already receives full-time pay from the Employer shall
not receive compensation from the Plan. In addition, the Trustee shall be
reimbursed for any reasonable expenses, including reasonable counsel fees
incurred by it as Trustee. Such compensation and expenses shall be paid from the
Trust Fund unless paid or advanced by the Employer. All taxes of any kind and
all kinds whatsoever that may be levied or assessed under existing or future
laws upon, or in respect of, the Trust Fund or the income thereof, shall be paid
from the Trust Fund.
7.7 ANNUAL REPORT OF THE TRUSTEE
Within a reasonable period of time after the later of the Anniversary Date
or receipt of the Employer's contribution for each Plan Year, the Trustee shall
furnish to the Employer and Administrator a written statement of account with
respect to the 'Plan Year for which such contribution was made setting forth:
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(a) the net income, or loss, of the Trust Fund;
(b) the gains, or losses, realized by the Trust Fund upon sales or
other disposition of the assets;
(c) the increase, or decrease, in the value of the Trust Fund;
(d) all payments and distributions made from the Trust Fund; and
(e) such further information as the Trustee and/or Administrator deems
appropriate. The Employer, forthwith upon its receipt of each such
statement of account, shall acknowledge receipt thereof in writing and
advise the Trustee and/or Administrator of its approval or disapproval
thereof. Failure by the Employer to disapprove any such statement of
account within thirty (30) days after its receipt thereof shall be deemed
an approval thereof. The approval by the Employer of any statement of
account shall be binding as to all matters embraced therein as between the
Employer and the Trustee to the same extent as if the account of the
Trustee had been settled by judgment or decree in an action for a judicial
settlement of its account in a court of competent jurisdiction in which the
Trustee, the Employer and all persons having or claiming an interest in the
Plan were parties; provided, however, that nothing herein contained shall
deprive the Trustee of its right to have its accounts judicially settled if
the Trustee so desires.
7.8 AUDIT
(a) If an audit of the Plan's records shall be required by the Act and
the regulations thereunder for any Plan Year, the Administrator shall
direct the Trustee to engage on behalf of all Participants an independent
qualified public accountant for that purpose. Such accountant shall, after
an audit of the books and records of the Plan in accordance with generally
accepted auditing standards, within a reasonable period after the close of
the Plan Year, furnish to the Administrator and the Trustee a report of his
audit setting forth his opinion as to whether any statements, schedules or
lists that are required by Act Section 103 or the Secretary of Labor to be
filed with the Plan's annual report, ate presented fairly in conformity
with generally accepted accounting
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principles applied consistently. All auditing and accounting fees shall be
an expense of and may, at the election of the Administrator, be paid from
the Trust Fund.
(b) If some or all of the information necessary to enable the
Administrator to comply with Act Section 103 is maintained by a bank,
insurance company, or similar institution, regulated and supervised and
subject to periodic examination by a state or federal agency, it shall
transmit and certify the accuracy of that information to the Administrator
as provided in Act Section 103(b) within one hundred twenty (120) days
after the end of the Plan Year or by such other date as may be prescribed
under regulations of the Secretary of Labor.
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE
(a) The Trustee may resign at any time by delivering to the Employer,
at least thirty (30) days before its effective date, a written notice of
his resignation.
(b) The Employer may remove the Trustee by mailing by registered or
certified mail, addressed to such Trustee at his last known address, at
least thirty (30) days before its effective date, a written notice of his
removal.
(c) Upon the death, resignation, incapacity, or removal of any
Trustee, a successor may be appointed by the Employer; and such successor,
upon accepting such appointment in writing and delivering same to the
Employer, shall, without further act, become vested with all the estate,
rights, powers, discretions, and duties of his predecessor with like
respect as if he were originally named as a Trustee herein. Until such a
successor is appointed, the remaining Trustee or Trustees shall have full
authority to act under the terms of the Plan.
(d) The Employer may designate one or more successors prior to the
death, resignation, incapacity, or removal of a Trustee. In the event a
successor is so designated by the Employer and accepts such designation,
the successor shall, without further act, become vested with all the
estate, rights, powers, discretions, and duties of his predecessor with the
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like effect as if he were originally named as Trustee herein immediately
upon the death, resignation, incapacity, or removal of his predecessor.
(e) Whenever any Trustee hereunder ceases to serve as such, he shall
furnish to the Employer and Administrator a written statement of account
with respect to the portion of the Plan Year during which he served as
Trustee. This statement shall be either (i) included as part of the annual
statement of account for the Plan Year required under Section 7.7 or (ii)
set forth in a special statement. Any such special statement of account
should be rendered to the Employer no later than the due date of the annual
statement of account for the Plan Year. The procedures set forth in Section
7.7 for the approval by the Employer of annual statements of account shall
apply to any special statement of account rendered hereunder and approval
by the Employer of any such special statement in the manner provided in
Section 7.7 shall have the same effect upon the statement as the Employer's
approval of an annual statement of account. No successor to the Trustee
shall have any duty or responsibility to investigate the acts or
transactions of any predecessor who has rendered all statements of account
required by Section 7.7 and this subparagraph.
7.10 TRANSFER OF INTEREST
Notwithstanding any other provision contained in this Plan, the Trustee at
the direction of the Administrator shall transfer the Vested interest, if any,
of such Participant in his account to another trust forming part of a pension,
profit sharing or stock bonus plan maintained by such Participant's new employer
and represented by said employer in writing as meeting the requirements of Code
Section 401(a), provided that the trust to which such transfers are made permits
the transfer to be made.
Notwithstanding the above, with respect to distributions made after
December 31, 1992, if the distributee of any "eligible rollover distribution"
(as defined in Code Section 402(f)(2)(A)) (1) elects to have such distribution
paid directly to an "eligible retirement plan", and (2) specifies the "eligible
retirement plan" to which such distribution is to be paid (in such form and at
such time as the Administrator may prescribe), then the "distribution shall be
made in the form of a direct trustee-to-trustee transfer to the specified
eligible retirement plan. Moreover, the amount subject to the direct
trustee-to-trustee transfer shall be limited to the amount of the
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distribution that would be includible in gross income if not transferred in
accordance with the preceding (determined without regard to Code Sections 402(c)
and 403(a)(4)).
For purposes. of this section, the term "eligible retirement plan" has the
meaning given such term by Code Section 402(c)(8)(B), except that a qualified
trust shall be considered an eligible retirement plan only if it is a defined
contribution plan, the terms of which permit the acceptance of rollover
distributions.
ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS
8.1 AMENDMENT
(a) The Employer shall have the right at any time to amend the Plan,
subject to the limitations of this Section. However, any amendment which
affects the rights, duties or responsibilities of the Trustee and
Administrator may only be made with the Trustee's and Administrator's
written consent. Any such amendment shall become effective as provided
therein upon its execution. The Trustee shall not be required to execute
any such amendment unless the Trust provisions contained herein are a part
of the Plan and the amendment affects the duties of the Trustee hereunder.
(b) No amendment to the Plan shall be effective if it authorizes or
permits any part of the Trust Fund (other than such part as is required to
pay taxes and administration expenses) to be used for or diverted to any
purpose other than for the exclusive benefit of the Participants or their
Beneficiaries or estates; or causes any reduction in the amount credited to
the account of any Participant; or causes or permits any portion of the
Trust Fund to revert to or become property of the Employer.
(c) Except as permitted by Regulations, no Plan amendment or
transaction having the effect of a Plan amendment (such as a merger, plan
transfer or similar transaction) shall be effective to the extent it
eliminates or reduces any "Section 411(d)(6) protected benefit" or adds or
modifies conditions relating to "Section 411(d)(6) protected benefits" the
result of which is a further restriction on such benefit unless such
protected benefits are preserved with respect to benefits accrued as of the
later of the adoption date
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or effective date of the amendment. "Section 411(d)(6) protected benefits"
are benefits described in Code Section 411(d)(6)(A), early retirement
benefits and retirement-type subsidies, and optional forms of benefit.
8.2 TERMINATION
(a) The Employer shall have the right at any time to terminate the
Plan by delivering to the Trustee and Administrator written notice of such
termination. Upon any full or partial termination, all amounts credited to
the affected Participants' Combined Accounts shall become 100% vested as
provided in Section 6.4 and shall not thereafter be subject to forfeiture,
and all unallocated amounts shall be allocated to the accounts of all
Participants in accordance with the provisions hereof.
(b) Upon the full termination of the Plan, the Employer shall direct
the distribution of the assets of the Trust Fund to Participants in a
manner which is consistent with and satisfies the provisions of section
6.5. Distributions to a Participant shall be made in cash or in property or
through the purchase of irrevocable nontransferable deferred commitments
from an insurer. Except as permitted by Regulations, the termination of the
Plan shall not result in the reduction of "Section 411(d)(6) protected
benefits" in accordance with Section 8.1(c).
8.3 MERGER OR CONSOLIDATION
This Plan and Trust may be merged or consolidated with, or its assets
and/or liabilities may be transferred to any other plan and trust only if the
benefits which would be received by a Participant of this Plan, in the event of
a termination of the plan immediately after such transfer, merger or
consolidation, are at least equal to the benefits the Participant would have
received if the Plan had terminated immediately before the transfer, merger or
consolidation, and such transfer, merger or consolidation does not otherwise
result in the elimination or reduction of any "Section 411(d)(6) protected
benefits" in accordance with Section 8.1(c).
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ARTICLE IX
MISCELLANEOUS
9.1 PARTICIPANT'S RIGHTS
This Plan shall not be deemed to constitute a contract between the Employer
and any Participant or to be a consideration or an inducement for the employment
of any Participant or Employee. Nothing contained in this Plan shall be deemed
to give any Participant or Employee the right to be retained in the service of
the Employer or to interfere with the right of the Employer to discharge any
Participant or Employee at any time regardless of the effect which such
discharge shall have upon him as a Participant of this Plan.
9.2 ALIENATION
(a) Subject to the exceptions provided below, no benefit which shall
be payable out of the Trust Fund to any person (including a Participant or
his Beneficiary) shall be subject in any manner to anticipation,
alienation, sale, transfer, assignment, pledge, encumbrance, or charge, and
any attempt to anticipate, alienate, sell, transfer, assign, pledge,
encumber, or charge the same shall be void; and no such benefit shall in
any manner be liable for, or subject to, the debts, contracts, liabilities,
engagements, or torts of any such person, nor shall it be subject to
attachment or legal process for or against such person, and the same shall
not be recognized by the Trustee, except to such extent as may be required
by law.
(b) This provision shall not apply to the extent a Participant or
Beneficiary is indebted to the Plan, as a result of a loan from the Plan.
At the time a distribution is to be made to or for a Participant's or
Beneficiary's benefit, such proportion of the amount distributed as shall
equal such loan indebtedness shall be paid by the Trustee to the Trustee or
the Administrator, at the direction of the Administrator, to apply against
or discharge such loan indebtedness. Prior to making a payment, however,
the Participant or Beneficiary must be given written notice by the
Administrator that such loan indebtedness is to be so paid in whole or part
from his Participant's Combined Account. If the Participant or Beneficiary
does not agree that the loan indebtedness is a valid claim against his
Vested Participant's Combined Account, he shall be entitled to a review of
the validity of the
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claim in accordance with procedures provided in Sections 2.12 and 2.13.
(c) This provision shall not apply to a "qualified domestic relations
order" defined in Code Section 414(p), and those other domestic relations
orders permitted to be so treated by the Administrator under the provisions
of the Retirement Equity Act of 1984. The Administrator shall establish a
written procedure to determine the qualified status of domestic relations
orders and to administer distributions under such qualified orders.
Further, to the extent provided under a "qualified domestic relations
order", a former spouse of a Participant shall be treated as the spouse or
surviving spouse for all purposes under the Plan.
9.3 CONSTRUCTION OF PLAN
This Plan and Trust shall be construed and enforced according to the Act
and the laws of the State of California, other than its laws respecting choice
of law, to the extent not preempted by the Act.
9.4 GENDER AND NUMBER
Wherever any words are used herein in the masculine, feminine or neuter
gender, they shall be construed as though they were also used in another gender
in all cases where they would so apply, and whenever any words are used herein
in the singular or plural form, they shall be construed as though they were also
used in the other form in all cases where they would so apply.
9.5 LEGAL ACTION
In the event any claim, suit, or proceeding is brought regarding the Trust
and/or Plan established hereunder to which the Trustee or the Administrator may
be a party, and such claim, suit, or proceeding is resolved in favor of the
Trustee or Administrator, they shall be entitled to be reimbursed from the Trust
Fund for any and all costs, attorney's fees, and other expenses pertaining
thereto incurred by them for which they shall have become liable.
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9.6 PROHIBITION AGAINST DIVERSION OF FUNDS
(a) Except as provided below and otherwise specifically permitted by
law, it shall be impossible by operation of the Plan or of the Trust, by
termination of either, by power of revocation or amendment, by the
happening of any contingency, by collateral arrangement or by any other
means, for any part of the corpus or income of any trust fund maintained
pursuant to the Plan or any funds contributed thereto to be used for, or
diverted to, purposes other than the exclusive benefit of Participants,
Retired Participants, or their Beneficiaries.
(b) In the event the Employer shall make an excessive contribution
under a mistake of fact pursuant to Act Section 403(c)(2)(A), the Employer
may demand repayment of such excessive contribution at any time within one
(1) year following the time of payment and the Trustees shall return such
amount to the Employer within the one (1) year period. Earnings of the Plan
attributable to the excess contributions may not be returned to the
Employer but any losses attributable thereto must reduce the amount so
returned.
9.7 BONDING
Every Fiduciary, except a bank or an insurance company, unless exempted by
the Act and regulations thereunder, shall be bonded in an amount not less than
10% of the amount of the funds such Fiduciary handles; provided, however, that
the minimum bond shall be $1,000 and the maximum bond, $500,000. The amount of
funds handled shall be determined at the beginning of each Plan Year by the
amount of funds handled by such person, group, or class to be covered and their
predecessors, if any, during the preceding Plan Year, or if there is no
preceding Plan Year, then by the amount of the funds to be handled during the
then current year. The bond shall provide protection to the Plan against any
loss by reason of acts of fraud or dishonesty by the Fiduciary alone or in
connivance with others. The surety shall be a corporate surety company (as such
term is used in Act Section 412(a)(2)), and the bond shall be in a form approved
by the Secretary of Labor. Notwithstanding anything in the Plan to the contrary,
the cost of such bonds shall be an expense of and may, at the election of the
Administrator, be paid from the Trust Fund or by the Employer.
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9.8 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE
Neither the Employer nor the Trustee, nor their successors, shall be
responsible for the validity of any Contract issued hereunder or for the failure
on the part of the insurer to make payments provided by any such Contract, or
for the action of any person which may delay payment or render a Contract null
and void or unenforceable in whole or in part.
9.9 INSURER'S PROTECTIVE CLAUSE
Any insurer who shall issue Contracts hereunder shall not have any
responsibility for the validity of this Plan or for the tax or legal aspects of
this Plan. The insurer shall be protected and held harmless in acting in
accordance with any written direction of the Trustee, and shall have no duty to
see to the application of any funds paid to the Trustee, nor be required to
question any actions directed by the Trustee. Regardless of any provision of
this Plan, the insurer shall not be required to take or permit any action or
allow any benefit or privilege contrary to the terms of any Contract which it
issues hereunder, or the rules of the insurer.
9.10 RECEIPT AND RELEASE FOR PAYMENTS
Any payment to any Participant, his legal representative, Beneficiary, or
to any guardian or committee appointed for such Participant or Beneficiary in
accordance with the provisions of the Plan, shall, to the extent thereof, be in
full satisfaction of all claims hereunder against the Trustee and the Employer,
either of whom may require such Participant, legal representative, Beneficiary,
guardian or committee, as a condition precedent to such payment, to execute a
receipt and release thereof in such form as shall be determined by the Trustee
or Employer.
9.11 ACTION BY THE EMPLOYER
Whenever the Employer under the terms of the Plan is permitted or required
to do or perform any act or matter or thing, it shall be done and performed by a
person duly authorized by its legally constituted authority.
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9.12 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
The "named Fiduciaries" of this Plan are (1) the Employer, (2) the
Administrator and (3) the Trustee. The named Fiduciaries shall have only those
specific powers, duties, responsibilities, and obligations as are specifically
given them under the Plan. In general, the Employer shall have the sole
responsibility for making the contributions provided for under Section 4.1; and
shall have the sole authority to appoint and remove the Trustee and the
Administrator; to formulate the Plan's "funding policy and method"; and to amend
or terminate, in whole or in part, the Plan. The Administrator shall have the
sole responsibility for the administration of the Plan, which responsibility is
specifically described in the Plan. The Trustee shall have the sole
responsibility of management of the assets held under the Trust, except those
assets, the management of which has been assigned to an Investment Manager, who
shall be solely responsible for the management of the assets assigned to it, all
as specifically provided in the Plan. Each named Fiduciary warrants that any
directions given, information furnished, or action taken by it shall be in
accordance with the provisions of the Plan, authorizing or providing for such
direction, information or action. Furthermore, each named Fiduciary may rely
upon any such direction, information or action of another named Fiduciary as
being proper under the Plan, and is not required under the Plan to inquire into
the propriety of any such direction, information or action. It is intended under
the Plan that each named Fiduciary shall be responsible for the proper exercise
of its own powers, duties, responsibilities and obligations under the Plan. No
named Fiduciary shall guarantee the Trust Fund in any manner against investment
loss or depreciation in asset value. Any person or group may serve in more than
one Fiduciary capacity. In the furtherance of their responsibilities hereunder,
the "named Fiduciaries" shall be empowered to interpret the Plan and Trust and
to resolve ambiguities, inconsistencies and omissions, which findings shall be
binding, final and conclusive.
9.13 HEADINGS
The headings and subheadings of this Plan have been inserted for
convenience of reference and are to be ignored in any construction of the
provisions hereof.
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9.14 APPROVAL BY INTERNAL REVENUE SERVICE
(a) Notwithstanding anything herein to the contrary, contributions to
this Plan are conditioned upon the initial qualification of the Plan under
Code Section 401. If the Plan receives an adverse determination with
respect to its initial qualification, then the Plan may return such
contributions to the Employer within one year after such determination,
provided the application for the determination is made by the time
prescribed by law for filing the Employer's return for the taxable year in
which the Plan was adopted, or such later date as the Secretary of the
Treasury may prescribe.
(b) Notwithstanding any provisions to the contrary, except Sections
3.6, 3.7, and 4.1(f), any contribution by the Employer to the Trust Fund
is conditioned upon the deductibility of the contribution by the Employer
under the Code and, to the extent any such deduction is disallowed, the
Employer may, within one (1) year following the disallowance of the
deduction, demand repayment of such disallowed contribution and the Trustee
shall return such contribution within one (1) year following the
disallowance. Earnings of the Plan attributable to the excess contribution
may not be returned to the Employer, but any losses attributable thereto
must reduce the amount so returned.
9.15 UNIFORMITY
All revisions of this Plan shall be interpreted and applied in a uniform,
nondiscriminatory manner. In the event of any conflict between the terms of this
Plan and any Contract purchased hereunder, the Plan provisions shall control.
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IN WITNESS WHEREOF, this Plan has been executed the day and year first
above written.
Advent Software, Inc.
By /s/ STEPHANIE G. DIMARCO
------------------------
EMPLOYER
/s/ STEPHANIE G. DIMARCO
------------------------
TRUSTEE
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EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
of Advent Software, Inc. on Form S-8 of our report dated January 23, 1997, on
our audits of the consolidated financial statements of Advent Software, Inc. as
of December 31, 1996 and 1995, and for the each of the three years in the period
ended December 31, 1996, which report is incorporated by reference from the 1996
Annual Report of Advent Software, Inc. and our report dated January 23, 1997, on
our audit of the consolidated financial statement schedule which report is
incorporated by reference from the Annual Report on Form 10-K for the year ended
December 31, 1996.
COOPERS & LYBRAND L.L.P.
San Jose, California
November 5, 1997
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the Registration
Statement of Advent Software, Inc. on Form S-8 of our report dated September 8,
1997, with respect to the financial statements and schedules of the Advent
Software, Inc. Profit Sharing and Employee Savings Plan (the "Plan") included in
the Annual Report for the Plan for the plan year ended December 31, 1996, as
filed on Form 11-K with the Securities and Exchange Commission.
MOHLER, NIXON & WILLIAMS
Accountancy Corporation
Campbell, California
September 8, 1997
<PAGE>
EXHIBIT 23.3
CONSENT OF COUNSEL
October 31, 1997
Advent Software, Inc.
301 Brannan Street, Suite 600
San Francisco, California 94107
Re: Consent of Wilson Sonsini Goodrich & Rosati, P.C.
Ladies and Gentlemen:
We consent to the use of our name wherever appearing in the
Registration Statement, including any Prospectus constituting a part thereof,
and any amendments thereto.
Very truly yours,
WILSON SONSINI GOODRICH & ROSATI
Professional Corporation
<PAGE>
EXHIBIT 99
INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
DISTRICT DIRECTOR
2 CUPANIA CIRCLE
MONTEREY PARK, CA 91755
Employer identification number:
94-2901952
Date: DEC 01 1993 File Folder Number:
940003197
ADVENT SOFTWARE INC Person to Contact:
C/O ROBERT A JOCELYNWESTERN PENSION WENDELL C. GREER
SERVICE CORP Contact Telephone Number:
1000 FOURTH STREET SUITE 300 (213) 725-0164
SAN RAFAEL, CA 94901-3116 Plan Name:
ADVENT SOFTWARE INC PROFIT
SHARING AND EMPLOYEE SAVINGS PLAN
Plan Number: 001
Dear Applicant:
We have made a favorable determination on your plan, identified above,
based on the information supplied. Please keep this letter in your permanent
records.
Continued qualification of the plan under its present form will depend on
its effect in operation. (See section 1.401-1 (b) (3) of the Income Tax
Regulations.) We will review the status of the plan in operation periodically.
The enclosed document explains the significance of this favorable
determination letter, points out some features that may affect the qualified
status of your employee retirement plan, and provides information on the
reporting requirements for your plan. It also describes some events that
automatically nullify it. It is very important that you read the publication.
This letter relates only to the status of your plan under the Internal
Revenue Code. It is not a determination regarding the effect of other federal or
local statutes.
This determination letter is applicable for the amendment(s) adopted on
JAN. 19, 1993.
This determination letter is applicable for the plan adopted on JAN. 1,
1988.
This letter is based upon the certification and demonstrations you
submitted pursuant to Revenue Procedure 91-66. Therefore, the certification and
demonstrations are considered an integral part of this letter. Accordingly, YOU
MUST KEEP A COPY OF THESE DOCUMENTS AS A PERMANENT RECORD OR YOU WILL NOT BE
ABLE TO RELY ON THE ISSUES DESCRIBED IN REVENUE PROCEDURE 91-66.
The information on the enclosed addendum is an integral part of this
determination. Please be sure to read and keep it with this letter.
We have sent a copy of this letter to your representative as indicated in
the power of attorney.
Letter 835 (DO/CG)
-1-
<PAGE>
ADVENT SOFTWARE INC
If you have questions concerning this matter, please contact the person
whose name and telephone number are shown above.
Sincerely yours,
Richard R. Orosco
District Director
Enclosures:
Publication 794
Addendum
-2-
<PAGE>
ADVENT SOFTWARE INC
This plan also satisfies the requirements of Code section 401(k).
This plan does not provide for contributions on behalf of participants with
less than one thousand hours of service during the plan year and/or does not
provide for contributions on behalf of participants not employed on the last day
of the plan year. The provision(s) may, in operation, cause this plan to fail
the coverage requirements of IRC 410(b) and/or the participation requirements of
IRC 401 (a) (26). If this discrimination occurs, this plan will not remain
qualified.
Letter 835 (DO/CG)
-3-
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