As filed with the Securities and Exchange Commission on July 17, 1996
Registration No. 33-333-1860
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
SAWTEK INC.
(Exact name of registrant as specified in its charter)
Florida 59-1864440
(State of incorporation) (I.R.S. Employer Identification No.)
1818 South Highway 441
Apopka, Florida 32703
(Address, of Principal Executive offices)
EMPLOYEE STOCK OWNERSHIP PLAN
AND TRUST AGREEMENT FOR
EMPLOYEES OF SAWTEK INC.
(Full title of the plan)
Steven P. Miller
SAWTEK INC.
1818 South Highway 441
Apopka, Florida 32703
(Name and address of agent for service)
(407) 886-8860
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
Title of Proposed Maximum Proposed Maximum Amount of
Securities to Amount to be Offering Price Aggregate offering Registration
be Registered Registered Per Share Price Fee
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
Common Stock, 9,956,432 (1)$23.625 (1)235,220,706 $81,110.59
$0.0005 par shares
value
- -------------------------------------------------------------------------------
(1)Estimated solely for the purpose of calculating the registration fee pursuant
to Rules 457(c) and 457(h) under the Securities Act of 1933, as amended upon the
basis of the average of the high and low prices of the Registrant's Common Stock
as reported on the NASDAQ National Market System on July 16, 1996.
<PAGE>
PART I. INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The information required by Part I is included in documents sent or
given to participants in the Employee Stock Ownership Plan and Trust Agreement
For Employees Of Sawtek Inc. (the "ESOP") pursuant to Rule 428(b)(1) under the
Securities Act of 1933, as amended (the "Securities Act").
PART II. INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Certain Documents by Reference.
SAWTEK INC. (the "Registrant") is subject to the informational and
reporting requirements of Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). The following documents,
which are filed with the Commission, are incorporated in this Registration
Statement by reference:
The Registrant's latest annual report filed pursuant to Section 13(a)
or 15(d) of the Exchange Act, or the latest prospectus filed pursuant to Rule
424(b) under the Securities Act that contains audited financial statements for
the Registrant's latest fiscal year for which such statements have been filed.
All other reports filed pursuant to Section 13(a) or 15(d) of the
Exchange Act since the end of the fiscal year covered by the document referred
to in (1) above.
The description of the Common Stock, par value $.0005 per share
("Common Stock"), contained in a registration statement filed on Form 8-A under
the Exchange Act, including any amendment or report filed for the purpose of
updating such description.
All documents subsequently filed by the Registrant pursuant to Sections
13(a), 13(c),, 14 and 15(d) of the Exchange Act prior to the filing of a
post-effective amendment which indicates that all shares of Common Stock offered
hereby have been sold or which deregisters all shares of Common Stock then
remaining unsold, shall be deemed to be incorporated by reference herein and to
be part hereof from the date of the filing of 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.
The Registrant, a Florida corporation, is empowered by Section 607.0850
of the Florida Business Corporation Act, subject to the procedures and
limitations stated therein, to indemnify any person who was or is a party to any
proceeding other than any action by, or in the right of, the corporation, by
reason of the fact that he is or was a director, officer, employee, or agent of
the corporation or is or was serving at the request of the corporation as a
director, officer, employee, or agent of another corporation, partnership, joint
venture, trust or other enterprise against liability incurred in connection with
such proceeding, including any appeal thereof, if he acted in good faith and in
a manner he reasonably believed to be in, or not opposed to, in the best
interests of the corporation and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was unlawful.
Section 607.0850 also empowers a Florida corporation to indemnify any
person who was or is a party to any proceeding by or in the right of the
corporation to procure a judgment in its favor by reason of the fact that he is
or was a director, officer, employee or agent of the corporation or is or was
serving at the request of the corporation as a director, officer employee or
agent of another corporation, partnership, joint venture, trust, or other
enterprise, against expenses and amounts paid in settlement not exceeding, in
the judgment of the board of directors, the estimated expense or litigating the
proceeding to conclusion, actually and reasonably incurred in connection with
the defense or settlement of such proceeding, including any appeal thereof, if
he acted in good faith and in a manner he reasonably believed to be in, or not
opposed to, the best interests of the corporation, except that no
indemnification may be made in respect of any claim, issue or matter as to which
such person shall have been adjudged to be liable unless, and only to the extent
that, the court in which such proceeding was brought, or any other court of
competent jurisdiction, shall determine upon application that, despite the
adjudication of liability but in view of all circumstances of the case, such
person is fairly and reasonably entitled to indemnify for such expenses which
such court shall deem proper. To the extent that a director, officer, employee
or agent of a corporation has been successful on the merits or otherwise in
defense of any proceeding referred to above, or in defense of any claim, issue
or matter therein, he shall be indemnified against expenses actually and
reasonably incurred by him in connection therewith.
The Registrant's Articles of Incorporation (the "Articles") contain a
provision entitling Directors and executive officers to be indemnified by the
Registrant against claims which may arise out of their actions in such
capacities to the fullest extent permitted by law. In addition, the Articles
contain provisions limiting the personal liability of Directors of theRegistrant
or its shareholders to the fullest extent permitted by law. The Registrant has
also secured insurance on behalf of its executive officers and Directors for
certain liabilities which may arise out of their actions in such capacities.
The Board of Directors of the Registrant has adopted resolutions to
indemnify and hold harmless any employees, officers or directors of the
Registrant serving the ESOP as a plan administrator or trustee against any
liabilities, costs and expenses which may be incurred by reason of their serving
in such capacities.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
The exhibits filed as part of this Registration Statement are as
follows:
EXHIBIT
NUMBER DESCRIPTION
4.1 --Amended and Restated Articles of Incorporation of Sawtek Inc.
(incorporated by reference to Registration Statement on Form S-1,
File No. 333-1860)
5.1 --Opinion of Akerman, Senterfitt & Eidson, P.A.
15.1 --Letter of Consent from Ernst & Young LLP.
23.1 --Consent of Akerman, Senterfitt & Eidson, P.A. Reference is made to
Exhibit 5.1
24.1 --Power of Attorney. Reference is made to the signature page hereto.
99.1 --Employee Stock Ownership Plan and Trust Agreement For Employees of
Sawtek Inc. (incorporated by reference to the Registration
Statement on Form S-1, File No. 333-1860)
99.2 --Resoluation adopted at the meeting of the Board of Directors held
April 27, 1996 with respect to the Employee Stock Ownershup Plan
and Trust Agreement for employees of Sawtek inc.
Item 9. Undertakings.
The Registrant hereby undertakes:
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.
(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 fort in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reelected in the form of prospectus
filed with the Commission pursuant to rule 424(b) of, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective 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;
That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new registration
statement relating to the securities offered herein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
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.
The Registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the Registrant's annual
report pursuant to Section 13(a) or Section 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.
Insofar as indemnification for liabilities arising under the Securities Act
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 Commission such indemnification is
against public policy as expressed in the Securities Actand is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the Registrant of expenses incurred 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 and as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.
SIGNATURES
Pursuant to the requirements of the Securities Act, 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 Apopka, State of Florida on the 17th day of July,
1996.
SAWTEK INC.
By:/s/Steven P. Miller
Steven P. Miller
Chairman, President and
Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned, officers and directors of SAWTEK INC., hereby
severally constitute Steven P. Miller and Neal J. Tolar, and each of them
singly, our true and lawful attorneys with full power to any of them, and to
each of them singly, to sign for us and in our names in the capacities indicated
below the Registration Statement on Form S-8 filed herewith and any and all
amendments to said Registration Statement and generally to do all such things in
our name and behalf in our capacities as officers and directors to enable SAWTEK
INC. to comply with the provisions of the Securities Act and all requirements of
the Securities and Exchange Commission, hereby ratifying and confirming our
signatures as they may be signed by our said attorneys, or any of them, to said
Registration Statement and any and all amendments thereto.
Pursuant to the requirements of the Securities Act, this Registration
Statement has been signed by the following persons in their capacities and on
the date indicated.
Signature Title Date
/s/Steven P. Miller Chairman, President and CEO 7/17/96
Steven P. Miller
/s/ Neal J. Tolar Sr. V.P., Chief Technical 7/17/96
Neal J. Tolar Officer and Director
Thomas L. Shoquist Vice President, Quality
Gary A. Monetti V.P., Operations and
Chief Operating Officer
/s/Raymond Link V.P., Finance and 7/17/96
Raymond A. Link Chief Financial Officer
/s/Robert C. Strandberg Director 7/17/96
Robert C. Strandberg
/s/Bruce S. White Director 7/17/96
Bruce S. White
/s/Willis C. Young Director 7/17/96
Willis C. Young
<PAGE>
EXHIBIT 5.1
AKERMAN, SENTERFITT & EIDSON, P.A. Attorneys at Law Citrus
Center 255 South Orange Avenue Post Office Box 231 Orlando, Florida 32802-0231
(407) 843-7860 Telecopy (407) 843-6610
July 17, 1996
Sawtek Inc.
1818 South Highway 441
Apopka, Florida 32703
Re: EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
AGREEMENT FOR EMPLOYEES OF SAWTEK INC. (the
"ESOP") - Registration Statement on Form S-8
Ladies and Gentlemen:
We have examined the Registration Statement on Form S-8 filed by you
with the Securities and Exchange Commission on July 17, 1996 (the "Registration
Statement") in connection with the registration under the Securities Act of
1933, as amended, of 9,899,840 shares of Common Stock of Sawtek Inc. (the
"Shares") to be distributed pursuant to the ESOP. As your counsel in connection
with this registration process, we have examined the proceedings proposed to be
taken in connection with said sale and issuance of the Shares.
It is our opinion that, upon completion of the proceedings being taken
or contemplated by us, as your counsel, to be taken prior to the issuance of the
Shares, and upon completion of the proceedings being taken in order to permit
such transactions to be carried out in accordance with the securities laws of
the various states, where required, the Shares when issued and sold in the
manner referred to in the Registration Statement will be legally isued, fully
paid and nonassessable.
We consent to the use of this opinion as an exhibit to the Registration
Statement, and further consent to the use of our name wherever appearing in the
Registration Statement, including the prospectus constituting part thereof, and
any amendment thereto and any registration statement for the same offering
covered by the Registration Statement that is to be effective upon filing
pursuant to Rule 462(b) and all post-effective amendments thereto.
Very truly yours,
AKERMAN, SENTERFITT & EIDSON,
PROFESSIONAL ASSOCIATION
By:/S/William A. Grimm
William A. Grimm
<PAGE>
EXHIBIT 15.1
CONSENT OF INDENPENDENT CERTIFIED PUBLIC ACCOUNTANTS
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 33-00000) pertaining to the Employee Stock Ownership Plan and
Trust Agreement for Employees of sawtek, Inc. of our report dated October 30,
1995 (except for Note 13, as to which the date is February 29, 1996, and Note
14, as to which the date is April 27, 1996) with respect to the consolidated
Financial statements of Sawtek, Inc. for the year ended September 30, 1995
included in its Registration Statement on Form S-1 (File No. 333-1860), which
was filed with the Securities and Exchange Commission on April 29, 1996
/s/Ernst & Young LLP
Ernst & Young LLP
Orlando, Florida
July 15, 1996
<PAGE>
EXHIBIT 99.1
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
AGREEMENT FOR EMPLOYEES OF SAWTEK INC.
PREPARED BY:
MAGUIRE, VOORHIS & WELLS, P.A.
Two South Orange Avenue
Orlando, Florida 32801
(AMENDED AND RESTATED FEBRUARY 15, 1996)
EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
AGREEMENT FOR EMPLOYEES OF SAWTEK INC.
<PAGE>
THIS AMENDMENT AND RESTATEMENT generally is made effective February 15,
1996, by SAWTEK INC., a Florida corporation (the "Employer").
BACKGROUND INFORMATION
A. Effective October 1, 1990, the Employer adopted the Employee Stock
Ownership Plan and Trust Agreement for Employees of Sawtek Inc. (the "Plan") in
order to enable the Eligible Employees of the Employer to acquire a proprietary
interest in the common stock of the Employer.
B. The Plan has been amended on three occasions since the original
effective date.
C. The Employer now desires to amend and restate the Plan in order to
incorporate the foregoing amendments and to modify the terms of the Plan to
better meet the needs of the Plan sponsor, Participants and Beneficiaries.
ARTICLE I.
DEFINITIONS
1.1 "Act" means the Employee Retirement Income Security Act of 1974, as
amended.
1.2 "Administrator" means the Employer, unless a person or committee of
persons is designated by the Employer pursuant to Article VIII to administer the
Plan on behalf of the Employer. Until such time as the Board of Directors of the
Employer provides otherwise, the President and Chief Financial Officer of the
Employer are appointed to administer the Plan on behalf of the Employer.
1.3 "Affiliated Employer" means the Employer and any of the following
entities:
(a) Any corporation which is a member of a "controlled group
of corporations" (as that phrase is defined in Code ss. 414(b)), which group
includes the Employer;
(b) Any trade or business (whether or not incorporated, and
including a sole proprietorship, partnership, estate and trust) which is under
"common control" (as that phrase is defined in Code ss. 414(c)) with the
Employer;
(c) Any entity (whether or not incorporated) which is a member
of an "affiliated service group" (as that phrase is defined in Code ss. 414(m)),
which group includes the Employer; and
(d) Any entity required to be aggregated with the Employer
pursuant to Regulations promulgated pursuant to Code ss. 414(o).
1.4 "Agreement" or "Plan" shall mean this instrument, including all
amendments and/or restatements.
1.5 "Anniversary Date" means September 30.
1.6 "Beneficiary" means the person or entity to whom a share of a deceased
Participant's Employer Account is payable, subject to the restrictions of
Section 6.2.
1.7 "Code" means the Internal Revenue Code of 1986, as amended or replaced
from time to time. ----
1.8 "Company Stock" means common stock issued by the Employer (or by a
corporation which is a member of the controlled group of corporations of which
the Employer is a member) which is readily tradeable on an established
securities market. If there is no common stock of the Employer which meets the
foregoing requirement, the term "Company Stock" means common stock issued by the
Employer (or by a corporation which is a member of the controlled group of
corporations of which the Employer is a member) having a combination of voting
power and dividend rights equal to or in excess of: (A) that class of common
stock of the Employer (or any other such controlled corporation) having the
greatest voting power, and (B) that class of common stock of the Employer (or of
any other such controlled corporation) having the greatest dividend rights.
Noncallable preferred stock shall be deemed to be "Company Stock" if such stock
is convertible at any time into stock which constitutes "Company Stock"
hereunder and if such conversion is at a conversion price which (as of the date
of the acquisition by the Trust) is reasonable.
1.9 "Company Stock Account" means a subaccount of the Participant's
Employer Account and is the account of a Participant which is credited with the
shares of Company Stock purchased and paid for by the Trust or contributed to
the Trust Fund.
1.10 "Compensation" means, with respect to any Participant, such
Participant's wages for the Plan Year within the meaning of Code ss. 3401(a)
(for the purposes of income tax withholding at the source) but determined
without regard to any rules that limit the remuneration included in wages based
on the nature or location of the employment or the services performed.
For purposes of this Section 1.10, the determination of Compensation shall
be made by including salary reduction contributions made on behalf of a
Participant to a plan maintained by the Employer pursuant to Code ss.ss. 125 or
401(k). Compensation shall not include any income realized or recognized
relating to the exercise of any incentive stock option or non-qualified
stockoption granted to the Participant by the Employer, or relating to the
purchase of Company Stock pursuant to an employee stock purchase plan maintained
by the Employer.
For a Participant's initial year of participation, Compensation shall be
recognized for the entire Plan Year.
Compensation in excess of $150,000.00 (or such other amount as the
Secretary of Treasury may designate from time to time pursuant to Code ss.
401(a)(17)(B) shall be disregarded. If a determination period consists of fewer
than 12 months, the foregoing annual compensation limit shall 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.
In determining the Compensation of an Employee, the "family attribution
rules" of Code ss.ss. 401(a)(17) and 414(q)(6) (as modified by Code ss.
401(a)(17)) shall apply.
1.11 "Current Obligations" means Trust obligations arising from an
extension of credit to the Trust which are payable in cash within one year from
the date an Employer Contribution is due.
1.12 "Direct Rollover" means a payment by the Trustee, pursuant to the
written direction of a Distributee, to an Eligible Retirement Plan. See Section
6.12.
1.13 "Distributee" means a Participant or Former Participant. In addition,
a Participant's or Former Participant's surviving spouse, and the Participant's
or Former Participant's former spouse who is the alternate payee under a
qualified domestic relations order, as defined in Code ss. 414(p), shall be
regarded as a Distributee with regard to the interest of such surviving or
former spouse.
1.14 "Early Retirement Date" means the first day of the month (prior to the
Participant's Normal Retirement Date) coinciding with or next following the date
on which a Participant or Former Participant attains age 55 and has completed at
least ten (10) Years of Service. A Former Participant who terminates employment
after satisfying the ten (10) year service requirement of this Section 1.14 and
who thereafter attains age 55 shall be entitled to receive his benefits under
the early retirement provisions of this Plan.
1.15 "Eligible Employee" means any Employee who is not otherwise described
in this Section 1.15 and has satisfied the service requirement of Section 2.1.
Employees who are Leased Employees, or non-resident aliens who do not
receive any earned income (as defined in Code ss.911(d)(2) from the Employer
which constitutes United States source income (as defined in Code ss.861(a)(3)),
shall not be eligible to participate in this Plan.
Employees who are included in a unit of employees covered by an agreement
which the Secretary of Labor finds to be a collective bargaining agreement
between employee representatives and the Employer shall not be eligible to
participate in this Plan if there is evidence that retirement benefits were the
subject of good faith bargaining between such employee representatives and the
Employer, unless such collective bargaining agreement requires the covered
employees to participate in this Plan.
1.16 "Eligible Retirement Plan" means an individual retirement account
described in Code ss. 408(a), an individual retirement annuity described in Code
ss. 408(b), an annuity plan described in Code ss. 403(a), or a qualified trust
described in Code ss. 401(a), that accepts a Distributee's Eligible Rollover
Distribution. However, in the case of an Eligible Rollover Distribution of the
surviving spouse of a Participant or Former Participant, an Eligible Retirement
Plan includes only an individual retirement account or individual retirement
annuity.
1.17 "Eligible Rollover Distribution" means any distribution of all or any
portion of the balance to the credit of the Distributee in the Plan, except that
an Eligible Rollover Distribution does not include (i) 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 Beneficiary, or for a specified period of ten years or more, (ii)
any distribution to the extent such distribution is required under Code ss.
401(a)(9), and (iii) the portion of any distribution that is not includable in
gross income (determined without regard to the exclusion for net unrealized
appreciation with respect to Employer securities).
1.18 "Employee" means any person who is employed by the Employer, or
Affiliated Employer, but excludes any person who is employed as an independent
contractor.
The term "Employee" shall include any Leased Employee unless such Leased
Employee is covered by a plan described in Code ss. 414(n)(5) and Leased
Employees do not constitute more than 20% of the Employer's non-highly
compensated employees.
1.19 "Employer" means Sawtek Inc., a Florida corporation, any subsidiary or
parent of such corporation which adopts the Plan, any successor which shall
maintain the Plan, and any other employer permitted by the Employer to adopt the
Plan.
1.20 "ESOP" means an employee stock ownership plan that meets the
requirements of Code ss. 4975(e)(7) and Regulation ss. 54.4975-11.
1.21 "Exempt Loan" means a loan made to the Trust by a disqualified person
or a loan to the Plan which is guaranteed by a disqualified person and which
satisfies the requirements of ss. 2550.408b-3 of the Department of Labor
Regulations, Regulation ss. 54.4975-7(b) and Section 4.5 hereof.
1.22 "Family Members" means, with respect to an affected Participant, such
Participant's spouse, lineal descendants, and ascendents and their spouses, all
as described in Code ss. 414(1)(6)(B).
1.23 "Fiduciary" means any person who (a) exercises any discretionary
authority or discretionary control respecting the management of the Plan or
exercises any authority or control respecting the 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.
Such definition includes, but is not limited to, the Trustee, the Employer, its
Board of Directors, and the Administrator.
1.24 "Fiscal Year" means the Employer's accounting year of 12 months, which
begins on October 1 and ----------- ends on September 30.
1.25 "Forfeiture" means that portion of a Participant's Employer 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 one-year breaks in service.
For purposes of the preceding paragraph, in the case of a Terminated
Participant whose Vested interest in his Participant's Employer Account is zero,
such Terminated Participant shall be deemed to have received a distribution of
his Vested interest in his Participant's Employer Account upon his termination
of employment. Restoration of forfeited amounts shall occur pursuant to Section
3.3.
1.26 "Former Participant" means a person who has been a Participant, but
who has ceased to be a Participant for any reason.
1.27 "Hour of Service" means (a) 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; (b) 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; and (c) each hour
for which pay back is awarded or agreed to by the Employer without regard to
mitigation of damages.
For purposes of (a) above, Hours of Service shall be credited to the
computation period in which the duties are performed. For purposes of (b) above,
Hours of Service shall becredited to the computation period provided for in
Department of Labor Regulations ss. 2530.200b-2(c)(2). Finally, for purposes of
(c) above, Hours of Service shall be credited to the computation period or
periods to which the award or agreement for back pay pertains, rather than the
computation period in which the award, agreement or payment is made.
Notwithstanding the above, (i) no more than 501 Hours of Service are
required to be credited to any 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, 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 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 One-Year
Break in Service, and employment commencement date (or reemployment commencement
date). The provisions of Department of Labor Regulations ss.ss. 2530.200 b-2(b)
and (c) are incorporated herein by reference.
1.28 "Investment Manager" means any person, firm or corporation (other than
the Trustee or named Fiduciary) who (i) is a registered investment adviser under
the Investment Advisers Act of 1940, or is a bank or insurance company described
in Act ss. 3(38), (ii) has the power to manage, acquire, or dispose of Plans
assets, and (iii) acknowledges in writing its fiduciary responsibility to the
Plan under the Act.
1.29 "Leased Employee" means a person who provides services to the Employer
and is described in Code ss. 414(n) and Regulations promulgated thereunder.
Generally, a person shall be considered a Leased Employee if:
(a) he is not otherwise an Employee of the Employer;
(b) provides services to the Employer;
(c) such services are provided pursuant to an agreement
between the Employer and a leasing organization;
(d) such person has performed such services for the
Employer on a substantially full-time basis for at least twelve months; and
(e) such services are of a type historically performed in
the Employer's business field by employees.
1.30 "Net Profit" means with respect to any Fiscal Year, the Employer's net
income or profit for such Fiscal Year determined on the basis of the Employer's
books of account in accordance with the method of accounting regularly used by
the Employer, without any reduction for taxes upon income or for contributions
made by the Employer to this Plan or any other qualified retirement plan.
1.31 "Nonallocation Period" means the period beginning on the date of the
sale of Company Stock to the Plan and ending on the later of:
(a) the date which is 10 years after the date of sale; or
(b) the date of the Plan allocation attributable to the final
payment of acquisition indebtedness incurred in connection with such sale.
1.32 "Noncurrent Obligations" means Trust obligations arising from an
extension of credit to the Trust which are payable in cash later than one year
from the date an Employer contribution is due.
1.33 "Normal Retirement Date" means the first day of the month coinciding
with or next following the Participant's Normal Retirement Age. For purposes of
this Section, Normal Retirement Age means the later of the date the Participant
attains age 65 or the fifth anniversary of the date the Participant enters the
Plan pursuant to Section 2.2. A Participant shall become 100% Vested in his
Participant's Employer Account upon attaining his Normal Retirement Age.
1.34 "One-Year Break in Service" means a Plan Year during which an Employee
has not completed more than 500 Hours of Service with the Employer. An Employee
shall not incur a One-Year Break in Service for the Plan Year in which he
becomes a Participant, dies, retires or suffers a Total and Permanent
Disability. Further, solely for the purpose of determining whether a Participant
has incurred a One-Year Break in Service, Hours of Service shall be recognized
for "authorized leaves of absence" and "maternity or paternity leaves of
absence".
"Authorized leave of absence" means an unpaid, temporary cessation from
active employment with the Employer pursuant to an established,
non-discriminatory policy, whether occasioned by illness, military service, or
any other reason. A "maternity or paternity leave of absence" shall mean 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 One-Year Break in Service, or, in any case in
which the Administrator is unable to determine such hours normally credited,
eight 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.
1.35 "Other Investments Account" means a subaccount of the Participant's
Employer Account and is the account of a Participant which is credited with his
share of net gains or losses, Forfeitures and Employer Profit Sharing
Contributions held in a form other than Company Stock and which is debited with
payments made to pay for Company Stock.
1.36 "Participant" shall mean any Eligible Employee who becomes eligible
for and enters the Plan as provided in Sections 2.1 and 2.2, and has not for any
reason become ineligible to participate further in the Plan.
1.37 "Participant's Employer Account" shall mean the account established
and maintained by the Administrator for each Participant with respect to his
interest in the Plan resulting from the Employer's Profit Sharing Contributions
made pursuant to Section 3.1 and Forfeitures allocated pursuant to Section 3.3.
A Participant's interest in his Participant's Employer Account shall be subject
to the vesting provisions of Sections 6.4(e) and 7.5. A Participant's Employer
Account may be further subdivided into a Participant's Company Stock Account,
Other Investment's Account and Qualified Directed Investment Account.
1.38 "Plan Year" means the Plan's accounting year of 12 months commencing
on October 1 of each year --------- and ending the following September 30.
1.39 "Profit Sharing Contribution" means the Employer's discretionary
contribution to the Plan made pursuant to Section 3.1, and allocated to a
Participant's Employer Account pursuant to Section 3.3.
1.40 "Qualified Directed Investment Account" means the subaccount
established by the Administrator for a Qualified Participant that makes a
diversification election pursuant to Section 3.7.
1.41 "Qualified Election Period" means the six Plan Year period beginning
with the first Plan Year in which the Participant becomes a Qualified
Participant.
1.42 "Qualified Participant" means any Participant or Former Participant
who has attained age 55 and has been credited with ten (10) Years of Service
after becoming a Participant in the Plan.
1.43 "Regulation" means the income tax regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
1.44 "Retired Participant" means a person who has been a Participant, but
who has become entitled to retirement benefits under the Plan.
1.45 "Retirement Date" means the date as of which a Participant retires for
reasons other than death, termination of employment or Total and Permanent
Disability, whether such retirement occurs on or after a Participant's Early
Retirement Date or Normal Retirement Date.
1.46 "Suspense Account" means the account credited with the portion of all
Former Participants' Employer Accounts which have become forfeitable during any
Plan Year, but which have not been reallocated pursuant to Section 3.3(e).
1.47 "Terminated Participant" means a person who has been a Participant,
but whose employment has been terminated other than by reason of death, Total
and Permanent Disability or retirement.
1.48 "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, in its discretion. The determination of
such physician shall be considered a determination of the Administrator pursuant
to Section 8.4. The determination shall be applied uniformly to all
Participants.
1.49 "Trustee" means the person or persons named as Trustee herein and any
successors of such ------- persons.
1.50 "Trust Fund" means the assets of the Plan as the same shall exist from
time to time. ----------
1.51 "Unallocated Company Stock Suspense Account" means an account
containing Company Stock acquired with the proceeds of an Exempt Loan, which
Company Stock has not been released from such account and allocated to the
Participants' Company Stock Accounts.
1.52 "Valuation Date" means the Anniversary Date of the Plan, and any other
date on which the Administrator makes allocations, or pursuant to Section 5.1,
directs the Trustee to value the Trust Fund. In the event the Administrator
elects to value the Trust Fund on a daily basis,Valuation Date shall mean any
day on which the Federal Reserve and New York Stock Exchange are both open for
business.
1.53 "Vested" means the portion of a Participant's Employer Account that is
nonforfeitable. This Plan does not permit forfeiture for cause.
1.54 "Year of Service" shall mean a Plan Year during which an Employee is
credited with at least ---------------- 1,000 Hours of Service.
Years of Service (including service as a Leased Employee) with any
Affiliated Employer shall be recognized.
Service from the date on which the Employee first performs an Hour of
Service shall be counted in computing Years of Service for vesting purposes.
The Administrator shall, in accordance with a uniform, non-discriminatory
policy, credit Hours of Service pursuant to this Plan by counting actual Hours
of Service for any Employee compensated on an hourly basis, and by adopting for
salaried Employees an equivalency based upon a period of employment as provided
in ss. 2530.200-2(c) of the Department of Labor Regulations.
ARTICLE II.
ELIGIBILITY
2.1 CONDITIONS OF ELIGIBILITY
Any eligible Employee who was eligible to be a Participant in the Plan as
of February 15, 1996, shall continue to be eligible to participate hereunder.
Otherwise, any Employee who has completed 500 Hours of Service with the Employer
shall be eligible to participate hereunder on the date such service requirement
is met. An Eligible Employee's commencement date shall be the first date the
Eligible Employee is credited with one Hour of Service.
2.2 EFFECTIVE DATE OF PARTICIPATION
Any Eligible Employee who was a Participant in the Plan as of February 15,
1996, shall continue to be a Participant effective February 15, 1996.
Thereafter, an Eligible Employee who, pursuant to Section 2.1, has become
eligible to participate hereunder shall enter the Plan and become a Participant
effective as of the first day of the Plan Year (October 1) in which such
Eligible Employee met the service requirement of Section 2.1, or if later, the
Eligible Employee's commencement date of employment.
2.3 TERMINATION OF ELIGIBILITY
In the event a Participant shall go from a classification of an Eligible
Employee to a non-eligible Employee (e.g., by becoming a Leased Employee or
Employee covered by a collective bargaining agreement), such Former Participant
shall continue to accrue Years of Service and vest in his Participant's Employer
Account for each Year of Service completed while a non-eligible Employee, until
such time as his Participant's Employer Account shall be forfeited or
distributed pursuant to the terms of the Plan. Additionally, his Participant's
Employer Account shall continue to share in the income, gains or losses of the
Trust Fund, unless such Participant's Employer Account is otherwise segregated
and/or invested in a Qualified Directed Investment Account.
2.4 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 the Employer for the Plan Year has been made and
after the allocation of such contribution has been made pursuant to Section 3.3,
the Employer shall make a subsequent contribution with respect to the omitted
Employee in an amount which the Administrator would have allocated to such
omitted Participant's Employer Account (plus any lost earnings or minus any
losses due to the omission) had the Participant not been omitted. Such
contribution shall be made regardless of its deductibility in whole or in part
in any taxable year under applicable provisions of the Code.
2.5 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 Plan Year has been made
and after the allocation of such contribution has erroneously been made to his
Participant's Employer Account pursuant to Section 3.3, 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. However, in such event, the amount allocated with respect to
the ineligible person shall constitute a Forfeiture for the Plan Year in which
the discovery is made and shall be reallocated as a Forfeiture pursuant to
Section 3.3 for the Plan Year of discovery.
ARTICLE III.
CONTRIBUTION AND ALLOCATION
3.1 FORMULA FOR DETERMINING EMPLOYER'S CONTRIBUTION
(a) Except as provided in paragraph (b) below, for each Fiscal
Year, the Employer may, in its sole discretion, determine the amount, if any, of
any Profit Sharing Contribution to be made by it to the Plan. Such contribution
may be made by the Employer regardless of Net Profits or accumulated earnings,
and shall be allocated to each Participant's Employer Account. In determining
such contribution, the Employer shall be entitled to rely upon an estimate of
its Net Profit, of the total Compensation for all Participants, and of the
amounts contributable by it. Except as otherwise provided herein, the Employer's
determination of such contribution shall be binding on all Participants, and the
Administrator and Trustee. The Trustee shall have no right or duty to inquire
into the amount of the Employer's contribution or the method used in determining
the amount of the Employer's contribution, but shall be accountable only for
funds actually received by the Trustee.
(b) Notwithstanding paragraph (a) above, and except as otherwise
required herein, the Employer's Profit Sharing Contribution for each Fiscal
Year shall not be less than the amount required to enable the Trust to timely
discharge its Current Obligations, even if some or all of such
contribution may not be deductible by the Employer under the Code. Unless
required by this Section 3.1, the Employer's Profit Sharing Contribution for
any Fiscal Year shall not exceed the maximum amount allowable as a deduction to
the Employer under the provisions of Code ss. 404. All contributions by the
Employer shall be made in cash, Company Stock or in such property as (i) is
determined by the Employer, (ii) is acceptable to the Trustee, and, (iii) is
permitted by the Act and the Code.
(c) Notwithstanding paragraph (b) above, to the extent necessary to
provide the top heavy minimum allocations required by Article VII, the
Employer shall make a Profit Sharing Contribution even if it exceeds the
Employer's Net Profit or accumulated earnings or the amount which is deductible
under Code ss. 404.
(d) Except as provided above, any contribution by the Employer to the
Trust Fund is conditioned upon the deductibility of the contribution by the
Employer under the Code. To the extent any such deduction is disallowed, the
Employer may, within one year following a final determination of the
disallowance, whether by agreement with the Internal Revenue Service or by final
decision of a court of competent jurisdiction, demand repayment of
such disallowed contribution, and the Trustee shall return such contri-
bution within one year following the disallowance, provided such return of
contribution is otherwise permitted by the Code. 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.
(f) In the event the Employer shall make an excessive contribution
under a mistake of fact as described in ss. 403(c)(2)(A) of the Act, the
Employer may demand repayment of such excessive contribution at any time
within one year following the time of payment and the Trustee shall return
such amount to the Employer within the one 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.
3.2 TIME OF PAYMENT OF DISCRETIONARY CONTRIBUTION
The Employer shall pay to the Trustee its Profit Sharing Contribution for
each Fiscal 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. The Employer shall designate the Plan Year to which the contribution
relates. To the extent the Trust has Current Obligations, the Employer's Profit
Sharing Contribution shall be paid to the Plan in cash in sufficient and timely
amounts to meet the terms of such Current Obligations.
3.3 ACCOUNTING AND ALLOCATION
(a) The Administrator shall establish and maintain a Participant's Employer
Account in the name of each Participant to which the Administrator shall credit,
as of each Anniversary Date (or at more frequent intervals as are determined by
the Administrator), all amounts to be allocated to each Participant as hereafter
set forth. The Administrator may divide the Participant's Employer Account into
a Company Stock Account, Other Investments Account and/or Qualified Directed
Investment Account.
(b) (1) The Employer shall provide the Administrator with all information
required by the Administrator to make a proper allocation of any Employer's
Profit Sharing Contribution, Forfeitures, Company Stock released from the
Unallocated Company Stock Suspense Account or Trust Fund earnings and losses for
each Plan Year. Within a reasonable time after the date of receipt by the
Administrator of such information, the Administrator shall allocate any such
Profit Sharing Contributions, Company Stock released from the Unallocated
Company Stock Suspense Account, and Forfeitures (after making any reinstatements
required by Section 3.3(e)) to each Participant's Employer Account in the same
proportion that each such Participant's Compensation with respect to such Plan
Year bears to the total Compensation of all Participants with respect to such
Plan Year.
(2) For purposes of paragraph (b)(1) above, a Participant shall be entitled
to an allocation of the Profit Sharing Contribution, Company Stock released from
the Unallocated Company Stock Account, and Forfeitures, only if the Participant
was an Employee on the last day of the Plan Year (September 30) and if the
Participant was credited with more than 500 Hours of Service during the Plan
Year. This requirement shall apply even in the Plan Year of death, Total and
Permanent Disability and retirement.
(c) The Company Stock Account of each Participant shall be credited as of
each Anniversary Date with the Participant's allocable share (determined
pursuant to paragraph (b) above) of Company Stock (including fractional shares)
purchased and paid for by the Trust or contributed in kind to the Trust by the
Employer. In addition, each Participant's Company Stock Account shall be
credited as of each Anniversary Date with Forfeitures of Company Stock and with
stock dividends on Company Stock that previously had been allocated to the
Participant'sCompany Stock Account. Cash dividends on Company Stock held in a
Participant's Company Stock Account shall, in the discretion of the
Administrator, be allocated to the Participant's Other Investments Account, paid
directly to the Participant, or used to repay an Exempt Loan (provided that
Company Stock released from the Unallocated Company Stock Suspense Account and
allocated to the Participant's Company Stock Account has a fair market value not
less than the amount of cash dividends which would have been allocated to such
Participant's Other Investments Account for the Plan Year). Company Stock
acquired by the Plan with the proceeds of an Exempt Loan shall be allocated to
each Participant's Company Stock Account upon release from the Unallocated
Company Stock Suspense Account as provided in Section 3.3(f) below. Company
Stock received by the Trust during a Plan Year with respect to a Profit Sharing
Contribution by the Employer for the preceding Plan Year shall be allocated to
the Company Stock Accounts of Participants as of the Anniversary Date of such
preceding Plan Year.
(d) As of each Anniversary Date or other Valuation Date, before allocation
of the (i) Employer's Profit Sharing Contributions, (ii) Company Stock released
from the Unallocated Company Stock Suspense Account, and (iii) Forfeitures, any
earnings or losses (including net appreciation or net depreciation) of the Trust
Fund attributable to the Participants' Other Investments Accounts shall be
allocated to the Participants in the same proportion that each Participant's and
Former Participant's Other Investments Account, as of the beginning of the Plan
Year, bears to the total of all Participants' and Former Participants' adjusted
Other Investments Accounts, as of the beginning of the Plan Year. For purposes
of this paragraph, a Participant's or Former Participant's Employer Account
shall be adjusted and reduced for any withdrawals, disbursements or Forfeitures
during the Plan Year in accordance with procedures established by the
Administrator. Any Participant who terminated employment during the Plan Year
for any reason shall share only in the allocation of earnings or losses.
However, if any non-segregated account of a Participant has been distributed in
full prior to the allocation provided herein, no earnings and losses shall be
credited for that valuation period. See also Section 3.7 regarding the
allocation of earnings to Qualified Directed Investment Accounts.
For purposes of allocating earnings and losses, earnings and losses do not
include the interest paid under any installment contract for the purchase of
Company Stock by the Trust Fund or on any loan used by the Trust Fund to
purchase Company Stock, nor does it include income received by the Trust Fund
with respect to Company Stock acquired with the proceeds of an Exempt Loan to
the extent such income is used to repay the loan. All income received by the
Trust Fund from Company Stock acquired with the proceeds of an Exempt Loan may,
in the discretion of the Administrator, be used to repay such loan.
(e) As of each Anniversary Date or other Valuation Date, any amounts in the
Suspense Account that have become Forfeitures during the Plan Year shall first
be allocated to reinstate previously forfeited Participant's Employer Account
balances of Former Participants, if any, pursuant to Section 6.4(g), and any
remainder shall be added to the Employer's Profit Sharing Contribution and
allocated among the Participants' Employer Accounts in the same manner as, and
in connection with, the allocation of the Employer's Profit Sharing Contribution
allocated pursuant to Section 3.3(b) above. However, in the event the allocation
of Forfeitures provided herein shall cause the annual addition (as defined in
Section 3.4) to any Participant'sEmployer Account to exceed the amount allocable
by the Code, the excess shall be reallocated in accordance with Section 3.5. In
the event Forfeitures are not sufficient to reinstate a Former Participant's
Employer Account, the Employer shall contribute the difference to the Plan,
regardless of its deductibility for income tax purposes.
(f) All Company Stock acquired by the Plan with the proceeds of an Exempt
Loan shall be added to and maintained in the Unallocated Company Stock Suspense
Account. Such Company Stock shall be released and withdrawn from that account as
if all Company Stock in that account were encumbered. For each Plan Year during
the duration of the Exempt Loan, the number of shares of the Company Stock
released shall equal the number of encumbered shares held immediately before
release for the current Plan Year multiplied by a fraction, the numerator of
which is the amount of principal paid for the Plan Year and the denominator of
which is the sum of the numerator plus the principal to be paid for all future
Plan Years. (See Section 4.5 regarding Exempt Loans). As of each Anniversary
Date, the Administrator shall consistently allocate to each Participant's
Company Stock Account, in the same manner as the Employer's Profit Sharing
Contributions are allocated, non-monetary units (i.e., shares and fractional
shares of Company Stock) representing each Participant's interest in the Company
Stock withdrawn from the Unallocated Company Stock Suspense Account.
Notwithstanding the foregoing, Company Stock released from the Unallocated
Company Stock Suspense Account with cash dividends pursuant to Section 3.3(c)
above shall be allocated to each Participant's Company Stock Account in the same
proportion that each such Participant's number of shares of Company Stock
sharing in such cash dividends bears to the total number of shares of all
Participants' Company Stock sharing in such cash dividends. Income earned with
respect to Company Stock in the Unallocated Company Stock Suspense Account may
be used, at the discretion of the Administrator, to repay the Exempt Loan used
to purchase such Company Stock. Any income which is not so used shall be
allocated as income of the Plan.
(g) If a Former Participant is reemployed after five consecutive One-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.
(h) If, because of the service requirements in Section 3.3(b)(2), this Plan
would otherwise fail to meet the requirements of Code ss.ss. 401(a)(26), 410 or
401(a)(4) and the Regulations thereunder, because Employer Profit Sharing
Contributions and/or Forfeitures have not been allocated to a sufficient number
or percentage of Participants or Former Participants for a Plan Year, then the
following rules shall apply:
(1) The group of Participants eligible to share in the Employer's Profit
Sharing Contribution and/or 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 satisfythe 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 or Former Participants
eligible to share in the Employer's Profit Sharing Contribution and/or
Forfeitures for the Plan Year shall be further expanded to include the minimum
number of Former Participants who are not actively employed on the last day of
the Plan Year as are necessary to satisfy the applicable test. The specific
Former Participants who shall become eligible to share shall be those Former
Participants, when compared to similarly situated Former 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
Employer Account. Therefore, any amounts that have previously been allocated to
Participants or Former 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 or Former Participants would have
received had they been included in the allocations, even if it exceeds the
amount which would be deductible under Code ss. 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.
3.4 MAXIMUM ANNUAL ADDITIONS
(a) Notwithstanding Section 3.3, the maximum "annual
additions" credited to a Participant's Employer Account for any "limitation
year" shall equal the lesser of: (1) $30,000.00 (or, if greater, one-fourth of
the dollar limitation in effect under Code ss. 415(b)(1)(A)), or (2) 25% of the
Participant's Compensation for such "limitation year", as adjusted from time to
time as in Section 3.4(e) below. The dollar amount provided in (1) above (the
$30,000.00 limit) shall be increased by the lesser of the dollar amount
determined under (a)(1) above or the amount of Company Stock contributed, or
purchased with cash contributed. The dollar amount shall be increased provided
no more than one-third of the Employer's contributions for the Plan Year are
allocated to "highly compensated employees", as defined in Code ss. 414(q).
(b) For purposes of applying the limitations of Code ss. 415,
"annual additions" means the sum credited to a Participant's Employer Account
for any "limitation year" of: (1) Employer Profit Sharing Contributions; (2)
Employee contributions; (3) Forfeitures; (4) amounts allocated to an individual
medical account, as defined in Code ss. 415(l)(1) which is part of a pension or
annuity plan maintained by the Employer; and (5) except for purposes of
subsection (a)(2) above, amounts derived from contributions paid or accrued
which are attributable to post-retirement medical benefits allocated to the
separate account of a Key Employee (as defined in Code ss. 419(A)(d)(3)) or
under a welfare benefit plan (as defined in Code ss. 419(e)) maintained by the
Employer. The Compensation percentage limitation referred to in Section 3.4(a)
above shallnot apply to any contribution for medical benefits (within the
meaning of Code ss. 419(f)(2) after separation from service which is otherwise
treated as an annual addition, or any amount otherwise treated as an annual
addition under Code ss. 415(1)(l).
(c) For purposes of applying the limitations of Code ss. 415,
the following are not "annual additions": (1) transfer of funds from one
qualified plan to another; (2) rollover contributions (as defined in Code ss.ss.
402(a)(5), 403(a)(4), 403(b)(8) and 408(d)(3)); (3) repayments of distributions
received by an Employee pursuant to Code ss. 411(a)(7)(B) (cash-outs); (4)
repayments of distributions received by an Employee pursuant to Code ss.
411(a)(3)(D) (mandatory contributions); (5) Employee contributions to a
simplified employee pension excludable under Code ss. 408(k)(6); (6) deductible
Employee contributions to a qualified Plan; and (7) provided no more than
one-third of the Employer Profit Sharing Contributions for the Plan Year are
allocated to "highly compensated employees," Forfeitures of Company Stock
purchased with the proceeds of an Exempt Loan and Employer contributions applied
to the payment of interest on an Exempt Loan.
(d) For purposes of applying the limitations of Code ss. 415, the
"limitation year" shall be the Plan Year.
(e) The limitation stated in paragraph (a)(1) above shall be
adjusted annually as provided in Code ss. 415(d) pursuant to Regulations. The
adjusted limitation is effective as of January 1 of each calendar year and is
applicable to "limitation years" ending with or within that calendar year.
(f) For purposes 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 purposes of this Section, all Employees of any Affiliated Employers
shall be considered to be employed by a single Employer.
(h) (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 Employer Account during the
"limitation year."
(2) If a Participant participates in both a defined contribution plan
subject to Code ss. 412 and a defined contribution plan not subject to Code ss.
412 maintained by the Employer which have the same Anniversary Date, "annual
additions" will be credited to the Participant's account under the defined
contribution plan subject to Code ss. 412 prior to crediting "annual additions"
to the Participant's account under a defined contribution plan not subject to
Code ss. 412.
(3) If the Administrator allocated to a Participant's account the excess of
the Participant's "annual additions" for the "limitation year" over the maximum
allowable "annual additions" for such year, the Administrator shall attribute
the excess allocated as of such Anniversary Date to the 401(k) profit sharing
plan maintained by the Employer. Any such excess shall be determined after any
"annual additions" credited under subparagraphs (1) or (2) above.
(i) Except as otherwise provided herein, 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.
(j) The defined benefit plan fraction for any "limitation
year" is a fraction, the numerator of which is the "projected annual benefit" of
the Participant under all defined benefit plans (whether or not terminated)
maintained by the Employer (determined as of the close of the "limitation
year"), and the denominator of which is the lesser of 125% of the dollar
limitation determined for the "limitation year" under Code ss.ss. 415(b) and (d)
or 140% of the highest average compensation, including any adjustments under
Code ss. 415(b).
(k) 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 Employer Account as of the close of the "limitation year",
and the denominator of which is the sum of the lesser of the following amounts
determined for such year and each prior year of service with the Employer; (i)
the product of 1.25 multiplied by the dollar limitation in effect under Code ss.
415(c)(1)(A) for such "limitation year" (determined without regard to Code ss.
415(c)(6)); or (ii) the product of 1.4 multiplied by the amount which may be
taken into account under Code ss. 415(c)(1)(B) for such "limitation year".
(l) Notwithstanding the foregoing, for any "limitation year"
in which the Plan is a Top Heavy Plan, 1.0 shall be substituted for 1.25 in
paragraph (j) and (k) unless an extra minimum allocation is provided. However,
for any "limitation year" in which the Plan is a Super Top Heavy Plan, 1.0 shall
be substituted for 1.25 in any event.
(m) If the sum of the defined benefit plan fraction and the
defined contribution plan fraction shall exceed 1.0 in any "limitation year" for
any Participant in this Plan for reasons other than described in (n) below, the
Administrator shall limit, to the extent necessary, the "annual additions" to
such Participant's Employer Accounts for such "limitation year". If, after
limiting the "annual additions to such Participant's Employer Accounts for the
"limitation year", the sum of the defined benefit plan fraction and the defined
contribution plan fraction still exceed 1.0, the Administrator shall then adjust
the numerator of the defined benefit plan fraction so that the sum of both
fractions shall not exceed 1.0 in any "limitation year" for such Participant.
(o) If: (1) the substitution of 1.00 for 1.25 above, or (2)
the excess benefit accruals or "annual additions" provided for in Internal
Revenue Service Notice 82-19 cause the 1.0 limitation to be exceeded for any
Participant in any "limitation year", such Participant shall be subject to the
following restrictions for each future "limitation year" until the 1.0
limitation issatisfied: (A) the Participant's accrued benefit under the defined
benefit plan shall not increase, (B) no "annual additions" may be credited to a
Participant's Employer Account, and (C) no Employee contributions (voluntary or
mandatory) shall be made under any defined benefit plan or any defined
contribution plan of the Employer.
3.5 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS
(a) If, as a result of a reasonable error in estimating a
Participant's Compensation or other facts and circumstances to which Regulation
ss. 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) hold any "excess amount" in a "Section 415 suspense
account"; (2) 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"; and (3) reduce the Employer's Profit Sharing 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 ss. 415, over (2) the maximum
"annual additions" determined pursuant to Section 3.4.
(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" to Participants or Former
Participants.
3.6 TRANSFERS FROM QUALIFIED PLANS
This Plan shall not accept transfers or rollovers from other qualified
retirement plans.
3.7 QUALIFIED DIRECTED INVESTMENT ACCOUNT
(a) Each Qualified Participant may elect within 90 days after
the close of each Plan Year during the Qualified Election Period to direct the
Trustee in writing as to the investment of 25% of the total number of shares of
Company Stock acquired by or contributed to the Plan that have ever been
allocated to the Participant's Company Stock Account of such Qualified
Participant (reduced by the number of shares of Company Stock previously
reinvested pursuant to this Section 3.7). In the last Plan Year of the Qualified
Election Period, 50% shall be substituted for 25% in the preceding sentence.
Furthermore, the rules of Code ss. 401(a)(28) are incorporated herein by
reference.
(b) Notwithstanding Section 3.7(a), if the fair market value
(determined as of the Valuation Date immediately preceding the beginning of the
90 day election period) of Company Stock acquired by or contributed to the Plan
that has ever been allocated to the Participant's Company Stock Account of the
Qualified Participant is less than $500.00, then such Participant's Company
Stock Account shall not be subject to the diversification requirements of this
Section 3.7.
(c) A separate Qualified Directed Investment Account shall be
established by the Administrator for any Qualified Participant that makes a
diversification election pursuant to this Section 3.7. Such Qualified Directed
Investment Account shall not share in the earning or losses of the Trust Fund
with respect to the Company Stock so diversified, but instead shall be credited
or debited with only the earnings or losses attributable to the investments
directed pursuant to Section 3.7(d) below.
(d) The Administrator shall select at least three investment
options that shall be available to Qualified Participants for reinvestment of
the portion of their Participant's Company Stock Account diversified pursuant to
Section 3.7(a). A Qualified Participant shall have the right to direct the
portion of his Participant's Company Stock Account that has been diversified
into at least one of the three available options. A Qualified Participant may
change his investment option at least once a Plan Year in accordance with
procedures established by the Administrator. If the Administrator permits a
change of investment options only once a year, such change shall be made during
the first 90 days of the Plan Year. The Administrator and Trustee shall complete
a Qualified Participant's election under Section 3.7(a) or change his investment
option pursuant to this Section 3.7(d) within 90 days of receipt of written
notice from the Qualified Participant. Alternately, in lieu of establishing the
three investment options, the Administrator may authorize and direct the Trustee
to distribute the Company Stock subject to the diversification elections within
90 days after the close of the Plan Year.
(e) In the event a Qualified Participant directs a portion of
his Participant's Employer Account pursuant to this Section 3.7, such Qualified
Participant shall not have, with respect to such directed portion, the right to
demand Company Stock pursuant to Code ss.409(h)(1)(A) and Section 7.7 of this
Plan.
ARTICLE IV.
FUNDING AND INVESTMENT POLICY
4.1 INVESTMENT POLICY
(a) The Plan is designed to invest primarily in Company Stock.
(b) Notwithstanding paragraph (a) above, the Administrator may
also direct the Trustee to invest in other property described in the Trust or
the Trustee may hold such funds in cash or cash equivalents.
(c) The Administrator may direct the Trustee to invest a
portion of the Trust Fund in insurance policies on the life of any "keyman"
Employee. The proceeds of a "keyman" insurance policy may not be used for the
repayment of any indebtedness owed by the Plan which is secured by Company
Stock. In the event any "keyman" insurance is purchased by the Trustee, the
premiums paid thereon during any Plan Year, net of any policy dividends and
increases in cash surrender values, shall be treated as the cost of the Plan's
investment and any death benefit or cash surrender value received shall be
treated as proceeds from an investment of the Plan.
(d) The Plan may not obligate itself to acquire Company Stock
from a particular holder thereof at an indefinite time determined upon the
happening of an event such as the death of the holder.
(e) The Plan may not obligate itself to acquire Company Stock
under a put option binding upon the Plan. However, at the time a put option is
exercised by the Employer, the Plan may be given an option to assume the rights
and obligations of the Employer under a put option binding upon the Employer.
(f) All purchases of Company Stock shall be made at a price
which, in the judgment of the Administrator, does not exceed the fair market
value thereof. All sales of the Company Stock shall be made at a price which, in
the judgment of the Administrator, is not less than the fair market value
thereof. The valuation rules set forth in Article V and Code ss. 401(a)(28)
shall be applicable to all such purchases and sales.
4.2 EMPLOYER SECURITIES
The Plan is designed to invest in "qualifying Employer
securities" as that term is defined in the Act, provided, however, that
immediately after the acquisition of such qualifying Employer securities, the
fair market value of such securities in the Trust Fund shall not exceed 100% of
the fair market value of all assets in the Trust Fund.
4.3 APPLICATION OF CASH
Employer contributions in cash and other cash received by the
Trust Fund shall first be applied to pay any Current Obligations of the Trust
Fund.
4.4 TRANSACTIONS INVOLVING COMPANY STOCK
(a) No portion of the Trust Fund attributable to (or allocable
in lieu of) Company Stock acquired by the Plan in a sale to which Code ss. 1042
applies may accrue, or be allocated directly or indirectly under any plan
maintained by the Employer meeting the requirements of Code ss. 401(a):
(1)During the Nonallocation Period, for the benefit of:
(i)Any taxpayer who makes an election under Code ss. 1042(a) with respect
to
Company Stock; or
(ii)Any individual who is related to the taxpayer within the meaning of
Code ss. 267(b), or
(2)For the benefit of any other person who owns
(after application of Code ss. 318(a), applied
without regard to the employee trust exemption in
Code ss. 318(a)(2)(B)(i)) more than 25% of:
(i)Any class of outstanding stock of the Employer or Affiliated Employer
which issued such Company Stock, or
(ii)The total value of any class of outstanding stock of the Employer or
Affiliated Employer.
(b) Subparagraph (a)(1)(ii) (relating to family attribution
rules) shall not apply to lineal descendants of the taxpayer, provided that the
aggregate amount allocated to the benefit of all such lineal descendants during
the Nonallocation Period does not exceed more than 5% of the Company Stock (or
amounts allocated in lieu thereof) held by the Plan which are attributable to a
sale to the Plan by any person related to such descendants (within the meaning
of Code ss. 267(c)(4)) in a transaction to which Code ss. 1042 is applied.
(c) A person shall be treated as failing to meet the 25% stock
ownership limitation under paragraph (a)(2) above if such person fails such
limitation:
(1)At any time during the one year period ending on the date of sale of
Company Stock to the Plan, or
(2)On the date as of which Company Stock is allocated to Participants in
the Plan.
4.5 LOANS TO THE TRUST
(a) The Plan may borrow money for any lawful purpose, provided
the proceeds of an Exempt Loan are used within a reasonable time after receipt
only to:
(1) Acquire Company Stock;
(2) Repay an Exempt Loan; or
(3) Repay a prior Exempt Loan.
(b) All loans to the Trust which are made or guaranteed by a
disqualified person must satisfy all requirements applicable to Exempt Loans
under Code ss. 4975(d)(2) and Regulationss. 34.4975-7(b)(1) and Department of
Labor Regulation ss. 2550.402(b)-3 including, but not limited to, the following:
(1)The loan must be at a reasonable rate of interest;
(2)The amount of interest paid shall not exceed the
amount of each payment which would be treated as
interest under standard loan amortization tables;
(3)Any collateral pledged to the creditor by the Plan
shall consist only of the Company Stock purchased
with the borrowed funds;
(4)Under the terms of the loan, any pledge of Company
Stock shall provide for the release of shares so
pledged on a pro-rata basis pursuant to Section
3.3(f);
(5)Under the terms of the loan, the creditor shall
have no recourse against the Plan except with respect
to such collateral, earnings attributable to such
collateral, Employer contributions (other than
contributions of Company Stock) that are made to meet
Current Obligations and earnings attributable to such
contributions;
(6)The loan must be for a specific term and may not be payable at the
demand of any person, except in the case of default;
(7)The term of the loan (including the sum of the
expired duration of the loan, any renewal period, any
extension period, and the duration of any new loan)
shall not exceed ten (10) years;
(8)The loan must provide for annual payments of
principal and interest at a cumulative rate that is
not less rapid at any time than level annual payments
of such amounts for ten (10) years;
(9)In the event of default upon an Exempt Loan, the
value of the Trust Fund transferred in satisfaction
of the Exempt Loan shall not exceed the amount of
default. If the lender is a disqualified person, an
Exempt Loan shall provide for a transfer of Trust
Funds upon default only upon and to the extent of the
failure of the Plan to meet the payment schedule of
the Exempt Loan; and
(10)Exempt Loan payments during a Plan Year must not
exceed an amount equal to: (A) the sum, over all Plan
Years, of all contributions and cash dividends paid
by the Employer to the Plan with respect to such
Exempt Loan and earnings on such Employer
contributions and cash dividends, less (B) the sum of
the ExemptLoan payments in all preceding Plan Years.
A separate accounting shall be maintained for such
Employer contributions, cash dividends and earnings
until the Exempt Loan is repaid.
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 Valuation Dates determined necessary by the
Administrator in its discretion, to determine the net worth of the assets
comprising the Trust Fund as it exists on the Anniversary Date or Valuation Date
prior to taking into consideration the Employer's Profit Sharing Contribution to
be allocated for that Plan Year. In determining such net worth, the Trustee
shall value the assets comprising the Trust Fund at their fair market value as
of the Anniversary Date or Valuation Date and shall deduct all expenses for
which the Trustee has not yet obtained reimbursement from the Employer or the
Trust Fund.
Determination of fair market value shall be made in good faith
and based on all relevant factors for determining the fair market value of the
asset. In the case of securities issued by the Employer, the valuation shall
consider the entire block of Employer securities owned by the Trust Fund.
In determining the value of any security, if the security is
traded on a national exchange, the Trustee shall consider the price at which it
was last traded. With respect to any unlisted security held in the Trust Fund,
the bid price next preceding the close of business on the Valuation Date shall
be considered. All valuations of Company Stock which is not readily tradeable on
an established securities market shall be made by an independent appraiser that
meets the requirements of Code ss. 401(a)(28)(c).
5.2 METHOD OF EVALUATION
Valuations must be made in good faith and based on all
relevant factors for determining the fair market value of securities. In the
case of a transaction between a Plan and a disqualified person, value must be
determined as of the date of the transaction. For all other Plan purposes, value
must be determined as of the most recent Valuation Date under the Plan. An
independent appraisal will not in itself be a good faith determination of value
in the case of a transaction between the Plan and a disqualified person.
However, in other cases, a determination of fair market value based on at least
an annual appraisal independently arrived at by a person who customarily makes
such appraisals and who is independent of any party to the transaction will be
deemed to be a good faith determination of value.
ARTICLE VI.
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT
(a) As of and after a Participant's Normal Retirement Date or
Early Retirement Date, a Participant may request a distribution of his
Participant's Employer Account, provided he has terminated his employment with
the Employer. As of the attainment of Normal Retirement Age and Early Retirement
Age, such Participant's Employer Account shall become 100% vested and
distributable. Participants shall be permitted to continue participation in the
Plan after their Normal Retirement Date. The form of distribution shall be made
pursuant to Section 6.5.
(b) Effective February 15, 1996, upon a request for a
retirement distribution, unless a Participant or Former Participant elects a
later distribution date, distribution of the Participant's Employer Account
shall be made or commence as soon as administratively practicable after receipt
of such request.
6.2 DETERMINATION OF BENEFITS UPON DEATH.
(a) Upon the death of a Participant before his Retirement Date
or other termination of employment, all amounts credited to such Participant's
Employer Account shall become 100% Vested. The form of distribution shall be
made pursuant to Section 6.6.
(b) 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 Participant's Employer 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.
(c) Unless otherwise elected and consented to in the manner
prescribed in Code ss. 417(a)(2), the Beneficiary of the death benefit of a
married Participant shall be the Participant's spouse. However, the Participant,
if married, may designate a Beneficiary other than his spouse if:
(1) The spouse has validly waived her right to be the Participant's
Beneficiary pursuant to Code ss. 417(a)(2); or
(2) The spouse cannot be located.
The designation of a Beneficiary by a Participant (whether married or
single) 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 notice of such revocation or change with the
Administrator. However, if married, the Participant's spouse must again consent
in writing to any change in Beneficiary unless the original consent acknowledges
that the spouse had the right to limit consent only to a specific Beneficiary
and that the spouse voluntarily electedto relinquish such right. In the event a
Participant has no spouse and no valid designation of Beneficiary exists at the
time of the Participant's death, the Participant's Employer Account shall be
payable in the following order:
(1) To his lineal descendants, per stirpes, including his legally adopted
children,
(2) To his lineal ascendents, per capita, that survive the Participant, and
(3) To his estate.
(d) Effective February 15, 1996, unless the Beneficiary elects a later
distribution date, distribution of the Participant's Employer Account shall be
made or commence as soon as administratively practicable in the calendar quarter
following the calendar quarter in which the Beneficiary requests a distribution
and the Administrator determines the Beneficiary is entitled to a distribution.
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY
(a) Upon a Participant's Total and Permanent Disability prior to his
Retirement Date or other termination of employment, all amounts credited to such
Participant's Employer Account shall become 100% Vested. The form of
distribution shall be made pursuant to Section 6.5.
(b) Effective February 15, 1996, upon a request for a Total and
Permanent Disability distribution, unless a Participant elects a later
distribution date, distribution of the Participant's Employer Account shall be
made or commence as soon as administratively practicable in the calendar quarter
following the calendar quarter in which the Participant requests a distribution
and the Administrator determines the Participant is entitled to a distribution.
6.4 DETERMINATION OF BENEFITS UPON TERMINATION
(a) If a Participant's employment with the Employer terminates for any
reason other than death, Total and Permanent Disability, or retirement, his
participation in the Plan shall terminate as of the Anniversary Date of the Plan
Year in which he terminates employment. The amount of the Terminated
Participant's Employer Account which is not Vested shall be credited to the
Suspense Account, pending Forfeiture, as of the date of termination of
employment.
(b) A Terminated Participant must give his written consent to any
distribution if the value (determined as of the date of distribution) of any
distribution exceeds $3,500.00. Notwithstanding the foregoing, the
Administrator, in its discretion, may distribute the Participant's Employer
Account of a Terminated Participant without the Participant's consent if the
value (determined as of the date of distribution) of such Participant's Employer
Account is less than $3,500.00. The form of distribution under this Section 6.4
shall be made pursuant to Section 6.5.
(c) For purposes of this Section 6.4, if a Terminated Participant's
Vested balance in his Participant's Employer Account is zero, the Terminated
Participant shall be deemed to have received a distribution of such Vested
account balance upon termination of employment.
(d) Effective for terminations of service occurring on and after
February 15, 1996, upon a request for a termination of service distribution,
unless a Former Participant elects a later distribution commencement date,
distribution of the Participant's Employer Account shall commence not later than
the last day of the Plan Year which is the fifth Plan Year after the Plan Year
in which the Participant otherwise separated from service with the Employer,
unless the Participant is reemployed by the Employer before distribution is
otherwise required by this paragraph. The rules of Code ss.409(o) are
incorporated herein by reference. See Section 6.5.
(e) The Vested portion of any Participant's Employer Account shall be a
percentage of the total amount credited to such Participant's Employer 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 3 0%
3 20%
4 40%
5 60%
6 80%
7 or more 100%
(f) The computation of a Participant's Vested percentage of his
interest in the Plan shall not be reduced as the result of any direct or
indirect amendment to this Plan. In the event that this Plan is amended to
change or modify any vesting schedule, a Participant with at least three Years
of Service as of the expiration date of the election period provided herein may
elect to have his Vested 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 amended 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 received written notice of the amendment from
the Employer or Administrator.
(g) (1) If any Former Participant shall be reemployed by the Employer
before a One-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 consecutive One-Year Breaks in Service, and such Former Participant had
received a distribution of his entire Vested Participant's Employer Account
prior to his re-employment, his forfeited Participant's Employer Account shall
be reinstated only if he repays the full amount distributed to him, prior to the
fifth anniversary of his date of reemployment. In the event the Former
Participant does repay the full amount distributed to him, the undistributed
portion of the Participant's Employer Account must be restored in full,
unadjusted by any gains or losses occurring subsequent to the Anniversary Date
or other Valuation Date preceding his termination. See Section 3.3 regarding the
reinstatement of Participant's Employer Accounts.
(3) If any Former Participant is reemployed after a One-Year Break in
Service has occurred, Years of Service shall include Years of Service prior to
his One-Year Break in Service subject to the following rules:
(i) If any non-Vested, Former Participant (i.e., had less than seven years
of Service at his termination of service) has a One-Year Break in Service (but
less than five consecutive One-Year Breaks in Service) he shall immediately be
eligible to participate in the Plan, and shall enter the Plan on his date of
reemployment. Except as provided below, Years of Service before and after his
One-Year Break in Service shall be recognized for vesting purposes with respect
to his Participant's Employer Account attributable to both pre-break and
post-break service.
(ii) After the greater of (A) five consecutive One-Year Breaks in Service,
or (B) a number of One-Year Breaks in Service equal to the Former Participant's
pre-break Years of Service, the Vested Participant's Employer Account
attributable to post-break Years of Service shall not be increased as a result
of pre-break Years of Service pursuant to Code ss. 411(a)(6)(D)(i);
(iii) After five consecutive One-Year Breaks in Service, a Former
Participant's Vested Participant's Employer Account balance attributable to
pre-break service shall not be increased as a result of post-break service; and
(iv) If a non-Vested, Former Participant incurs five consecutive One-Year
Breaks in Service, he must again satisfy the requirements of Sections 2.1 and
2.2 in order to become eligible for and enter the Plan; and
6.5 DISTRIBUTION OF LIFETIME BENEFITS
(a) Effective February 15, 1996, distribution of a Participant's
Employer Account on account of retirement (Section 6.1) or Total and Permanent
Disability (Section 6.3) shall be made in cash or in kind (as determined by the
Administrator, but subject to Section 6.7)in one lump sum, or in a fixed number
of quarterly, semiannual or annual installments over a period not to exceed the
Participant's life expectancy (or the life expectancy of the Participant and his
designated Beneficiary).
Effective February 15, 1996, with respect to distributions to
Participants that have terminated employment and have requested a distribution
pursuant to Section 6.4, unless the Participant elects in writing a longer
distribution period, such distribution of the Participant's Employer Account
made pursuant to Section 6.4, may be distributed in cash or in kind, (as
determined by the Administrator, but subject to Section 6.7) in substantially
equal periodic payments (not less frequently than annually) over a period of
five years. In the case of a Participant with a Participant's Employer Account
in the Plan in excess of $500,000, the five year period shall be extended one
additional year (up to an additional five) for each $100,000, or fraction
thereof, by which such account exceeds $500,000. Such dollar amounts shall be
adjusted at the same time and in the same manner as provided in Code ss. 415(d).
(b) If the value of the vested portion of the Participant's Employer
Account is less than $3,500, the Administrator, in its discretion, may direct
the immediate distribution of such Participant's Employer Account in a single,
lump sum payment without such Participant's consent. However, the vested portion
of the Participant's Employer Account may not be paid without his written
consent if the value exceeds $3,500 and distribution commences prior to his
Normal Retirement Date. Failure to consent shall be deemed to be an election to
defer the commencement of payment of any benefit.
(c) Notwithstanding this Section 6.5, cash dividends on shares of
Company Stock allocable to Participant's Company Stock Accounts may be paid
pursuant to Section 3.3 to Participants or Beneficiaries within 90 days after
the close of the Plan Year in which the dividend is paid.
(d) Any part of a Participant's Employer Account which is retained in
the Plan after the Anniversary Date on which his participation in the Plan
terminates will continue to be treated as a Company Stock Account, Other
Investments Account or Qualified Directed Investment Account. However, none of
those accounts shall be credited with any further Employer Profit Sharing
Contributions or Forfeitures.
(e) Notwithstanding any provision in this Agreement to the contrary, a
Participant's Employer Account shall be distributed to him not later than April
1 following the calendar year in which the Participant attains age 70 1/2.
Alternatively, installment distributions to a Participant must begin no later
than the April 1 following the calendar year in which the Participant attains
age 70 1/2 and must be made over a period not to exceed the life of the
Participant (or the lives of the Participant and his designated Beneficiary) or
the life expectancy of the Participant (or the life expectancy of the
Participant and his designated Beneficiary).
(f) If the Participants' Employer Account is to be distributed in
other than a lump sum, then the amount to be distributed each year must be at
least an amount equal to the quotient obtained by dividing the Participant's
Employer Account by the life expectancy of theParticipant or the joint and last
survivor expectancy of the Participant and his designated Beneficiary.
(g) If a Participant's retirement benefit is to be distributed to him
and his Beneficiaries over a period in excess of the Participant's then life
expectancy, the then present value of the payments to be made over the period of
the Participant's then life expectancy must be more than 50% of the present
value of the total payments to be made to the Participant and his Beneficiaries.
(h) If a distribution is one to which Code ss.ss. 401(a)(11) and 417
do not apply, such distribution may commence less than thirty (30) days after
the notice required under Regulation ss. 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 thirty (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.
(i) In no event shall a distribution required by this Article VI be
distributed later than 180 days after the Anniversary Date for the Plan Year in
which such distribution is to be made. However, unless otherwise elected in
writing by the Former Participant (such election may not result in a death
benefit that is more than incidental), a distribution shall begin not later than
the 60th day after the close of the Plan Year in which the latest of the
following events occurs.
(i) The date on which the Participant attains his Normal Retirement Age;
(ii) The 10th anniversary of the year in which the Participant commenced
participation in the Plan; or
(iii) The date the Participant terminates his service with the Employer.
6.6 DISTRIBUTION OF BENEFITS UPON DEATH
(a) Effective February 15, 1996, distribution of a Participant's
Employer Account to the Participant's Beneficiary in accordance with Section 6.2
shall be made in cash or in kind (as determined by the Administrator, but
subject to Section 6.7) in one lump sum, or in a fixed number of quarterly,
semiannual or annual installments. However, the commencement date and
distribution shall be subject to paragraphs (c), (d) and (e) and the applicable
provisions of Code ss.401(a)(9).
(b) If the value of the deceased Participant's Employer Account is
less than $3,500.00, the Administrator, in its discretion, may direct the
immediate distribution of such amount in a single lump sum payment to the
Participant's Beneficiary. If the value exceeds$3,500.00, an immediate
distribution of the entire amount may be made to the Beneficiary, provided such
Beneficiary consents in writing to such distribution.
(c) If the distribution of a Participant's Employer Account has begun
in accordance with Section 6.5 and the Participant dies before his entire
interest has been distributed to him, the remaining portion of such
Participant's Employer Account shall be distributed at least as rapidly as under
the method of distribution in effect under Section 6.5 as of his date of death.
(d) If a Participant dies before he has begun to receive any
distributions of his interest under the Plan, his death benefit generally shall
be distributed to his Beneficiaries within 5 years after his death.
(e) The 5-year distribution requirement of Section 6.6(d) above shall
not apply to any portion of the deceased Participant's Employer Account which is
payable to or for the benefit of a designated Beneficiary. In such event, such
portion may, in the discretion of the Beneficiary, be distributed over a period
not to exceed the life expectancy of such designated Beneficiary provided such
distribution begins not later than one year after the date of the Participant's
death (or such later date as may be prescribed by Regulations).
Notwithstanding the paragraph above, in the event the Participant's spouse
is his Beneficiary, the requirement that distributions commence within one year
of a Participant's death shall not apply. In lieu thereof, such distribution
must commence no later than the date on which the deceased Participant would
have attained age 70 1/2. If the surviving spouse dies before the distributions
to such spouse begin, then the 5-year distribution requirement of Section 6.6(d)
shall apply as if the spouse were the Participant.
6.7 HOW PLAN BENEFIT WILL BE DISTRIBUTED
(a) Distribution of a Participant's Employer Account may be made in
cash or Company Stock or both (as determined by the Administrator), provided,
however, that if a Participant or Beneficiary so demands, such benefit (other
than Company Stock sold and reinvested pursuant to Section 3.7) shall be
distributed only in the form of Company Stock. Prior to making a distribution of
benefits, the Administrator shall advise the Participant or his Beneficiary, in
writing, of the right to demand that benefits be distributed solely in Company
Stock.
(b) If a Participant or Beneficiary demands that benefits be
distributed solely in Company Stock, distribution of a Participant's Employer
Account will be made entirely in whole shares or other units of Company Stock.
Any balance in a Participant's Other Investments Account will be applied to
acquire for distribution the maximum number of whole shares or other units of
Company Stock at the then fair market value. Any fractional unit value
unexpended will be distributed in cash. If Company Stock is not available for
purchase by the Trustee, then the Trustee shall hold such balance until Company
Stock is acquired and then make such distribution, subject to this Article VI.
(c) The Trustee will make distributions from the Trust only on
instructions from the Administrator.
6.8 IN SERVICE DISTRIBUTION
(a) At such time as a Participant becomes 100% Vested, such
Participant may request once each Plan Year a distribution not to exceed five
percent (5%) of the value of such Participant's Employer Account, determined as
of the Anniversary Date or Valuation Date immediately preceding such request.
Such Participant shall continue to participate in the Plan provided the
Participant continues to meet the eligibility requirements of Article II.
(b) In service distributions pursuant to this Section shall be made in
one lump payment, in cash or in kind (as determined by the Administrator), but
the provisions of Sections 6.7 and 6.12 shall apply to in service distributions
permitted by this Section 6.8.
(c) Requests for in service distributions under this Section 6.8 shall
be made by the Participant to the Administrator on a form to be supplied by the
Administrator. The Administrator is authorized to, and shall, promulgate
procedures from time to time which govern in service distributions, including
the times of the Plan Year during which in service distributions may be
requested.
(d) This Section 6.8 shall be effective as soon as administratively
practicable after the completion of the Employer's initial public offering of
the Company Stock.
6.9 DISTRIBUTION FOR MINOR BENEFICIARY
In the event a distribution is to be made to a minor, then the
Administrator may, in his sole discretion, 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 minor
Beneficiary resides. Such payment to the legal guardian or parent of a minor
Beneficiary shall fully discharge the Trustee, Employer, Administrator and Plan
from further liability on account thereof.
6.10 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 expiration of five
years after it shall become payable, 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 forfeited and shall be used to reduce the cost of the
Plan. In the event a Participant or Beneficiary is located subsequent to his
benefit being forfeited, such benefit shall be restored.
6.11 LIMITATIONS ON BENEFITS AND DISTRIBUTIONS
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" as that term is
defined in Code ss. 414(p).
6.12 DIRECT ROLLOVERS
If and only if a Distributee is eligible to receive a distribution
pursuant to this Article VI, the Distributee may elect, at the time and in the
manner provided by the 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. Nothing in this Section 6.12 shall be
construed to grant a Distributee any right to a distribution other than those
rights otherwise provided in this Article VI.
6.13 RIGHT OF FIRST REFUSALS
(a) If any Participant, his Beneficiary or any other person to whom
shares of Company Stock are distributed from the Plan shall, at any time, desire
to sell some or all of such shares to a third party, the selling Participant or
Beneficiary shall give written notice of such desire to the Employer and the
Administrator, which notice shall contain the number of shares offered for sale,
the proposed terms of the sale and the names and addresses of both the
Participant or Beneficiary and the purchasing party. Both the Trust and the
Employer shall each have the right of first refusal for a period of fourteen
days (such fourteen day period to run concurrently against the Trust Fund and
the Employer) from the date such Participant or Beneficiary gives such written
notice to the Employer and the Administrator to acquire the offered Company
Stock. As between the Trust Fund and the Employer, the Trust Fund shall have
priority to acquire the shares pursuant to the right of first refusal. The
selling price and terms shall be the same as offered by the purchasing party.
(b) If the Trust Fund and the Employer do not exercise their right of
first refusal within the required fourteen day period provided above, the
Participant or Beneficiary shall have the right, at any time following the
expiration of such fourteen day period, to dispose of the offered Company Stock
to the purchasing party; provided, however, that (i) no disposition shall be
made to the purchasing party on terms more favorable to the purchasing party
than those set forth in the written notice delivered by the Participant or
Beneficiary above, and (ii) if such disposition shall not be made to a third
party on the terms offered to the Employer and the Trust Fund, the offered
Company Stock shall again be subject to the right of first refusal set forth
above.
(c) The closing pursuant to the exercise of the first refusal right
under this Section shall take place at such place agreed upon between the
Administrator and the Participant or Beneficiary, but not later than ten days
after the Employer or the Trust Fund shall have notified the Participant or
Beneficiary of the exercise of the right of first refusal. At such closing, the
Participant or Beneficiary shall deliver certificates representing the offered
Company Stock dulyendorsed in blank for transfer, or with stock powers attached
duly executed in blank with all required transfer tax stamps attached or
provided for, and the Employer or the Trust Fund shall deliver the purchase
price, or an appropriate portion thereof, to the Participant or Beneficiary.
(d) Except as provided in this paragraph (d), no Company Stock
acquired with the proceeds of an Exempt Loan complying with the requirements of
Section 4.5 hereof shall be subject to a right of first refusal. Company stock
acquired with the proceeds of an Exempt Loan, which is distributed to a
Participant or Beneficiary, shall be subject to the right of first refusal
provided for in paragraph (a) of this Section only so long as the Company Stock
is not publicly traded. The term "publicly traded" refers to stock listed on a
securities exchange registered under Section 6 of the Securities Exchange Act of
1934 (15 U.S.C. 78f) or that is quoted on a system sponsored by a national
securities association registered under Section 15A(b) of the Securities
Exchange Act (15 U.S.C. 780). In addition, in the case of Company Stock which
was acquired with the proceeds of a loan described in Section 4.5, the selling
price and other terms under the right must not be less favorable to the seller
than the greater of the value of the security determined under Regulation ss.
54.4975-11(d)(5), or the purchase price and other terms offered by a buyer
(other than the Employer or the Trust Fund), making a good faith offer to
purchase the security. The right of first refusal must lapse no later than
fourteen days after the security holder gives notice to the holder of the right
that an offer by a third party to purchase the security has been made. The right
of first refusal shall comply with the provisions of paragraphs (a), (b) and (c)
of this Section, except to the extent those provisions may conflict with the
provisions of this paragraph.
6.14 STOCK CERTIFICATE LEGEND
Certificates for shares distributed pursuant to the Plan shall contain
the following legend:
"The shares represented by this Certificate are transferable only upon
compliance with the terms of the EMPLOYEE STOCK OWNERSHIP PLAN AND
TRUST AGREEMENT FOR EMPLOYEES OF SAWTEK INC., effective as of October
1, 1990, which grants to the Company a right of first refusal, a copy
of said Plan being on file in the office of the Company."
6.15 PUT OPTION
(a) If Company Stock which was not acquired with the proceeds of an
Exempt Loan is distributed to a Participant and such Company Stock is not
readily tradeable on an established securities market, a Participant shall have
the right to require the Employer to repurchase the Company Stock distributed to
such Participant under a fair valuation formula. Such Stock shall be subject to
the provisions of Section 6.15(c) below.
(b) Company Stock which is acquired with the proceeds of an Exempt
Loan and which is not publicly traded when distributed, or if it is subject to a
trading limitation whendistributed, must be subject to a put option. For
purposes of this paragraph, a "trading limitation" on Company Stock is a
restriction under any federal or state securities law or any regulation
thereunder, or an agreement (not prohibited by Section 6.16) affecting the
Company Stock which would make the Company Stock not as freely tradeable as
stock not subject to such restriction.
(c) The put option shall be exercisable only by a Participant, by the
Participant's donees, or by a person (including an estate or its distributee) to
whom the Company Stock passes by reason of a Participant's death. (Under this
paragraph, Participant or Former Participant means a Participant or Former
Participant and the Beneficiaries of the Participant or Former Participant under
the Plan.) The put option must permit a Participant to put the Company Stock to
the Employer. Under no circumstances may the put option bind the Plan. However,
the option shall grant the Plan an option to assume the rights and obligations
of the Employer at the time that the put option is exercised. If it is known at
the time a loan is made that federal or state law will be violated by the
Employer's honoring such put option, the put option must permit the Company
Stock to be put, in a manner consistent with such law, to a third party (e.g.,
an affiliate of the Employer or a shareholder other than the Plan) that has
substantial net worth at the time the loan is made and whose net worth is
reasonably expected to remain substantial.
The put option shall commence as of the day following the date the
Company Stock is distributed to the Former Participant and end 60 days
thereafter and if not exercised within such 60-day period, an additional 60-day
option shall commence on the first day of the fifth month of the Plan Year next
following the date the Company Stock was distributed to the Former Participant
(or such other 60-day period as provided in Regulations). However, in the case
of Company Stock that is publicly traded without restrictions when distributed
but ceases to be so traded within the option period described herein, the
Employer must notify each holder of such Company Stock in writing on or before
the 10th day after the date the Company Stock ceases to be so traded that for
the remainder of the applicable option period the Company Stock is subject to
the put option. The number of days between the 10th day and the date on which
notice is actually given, if later than the 10th day, must be added to the
duration of the put option. The notice must inform distributees of the term of
the put options that they are to hold. The terms must satisfy the requirements
of this paragraph.
The put option shall be exercised by the holder notifying the Employer
in writing that the put option is being exercised. The notice shall state the
name and address of the holder and the number of shares to be sold. The period
during which a put option is exercisable does not include any time when a
distributee is unable to exercise it because the party bound by the put option
is prohibited from honoring it by applicable federal or state law. The price at
which a put option must be exercisable is the value of the Company Stock
determined in accordance with Article V. Payment under the put option involving
a "total distribution" shall be paid in substantially equal annual installments
over a period certain beginning not later than thirty days after the exercise of
the put option and not extending beyond five (5) years. The length of the term
of the payout shall be determined by the Administrator. The deferral of payment
shall be evidenced by a promissory note that is adequately secured and bears a
reasonable interest rate on the unpaid amounts. The first payment under the put
option involving installment distributions must be paid not later than thirty
(30) days after the exercise of the put option. Payment undera put option must
not be restricted by the provisions of a loan or any other arrangement,
including the terms of the Employer's articles of incorporation, unless so
required by applicable state law.
For purposes of this Section, "Total Distribution" means a
distribution to a Participant or his Beneficiary within one taxable year of the
entire Vested Participant's Employer Account.
(d) An arrangement involving the Plan that creates a put option must
not provide for the issuance of put options other than as provided under this
Section. The Plan (and the Trust Fund) must not otherwise obligate itself to
acquire Company Stock from a particular holder thereof at an indefinite time
determined upon the happening of an event such as the death of the holder.
6.16 NONTERMINABLE PROTECTIONS AND RIGHTS
No Company Stock, other than that described in Sections 6.13 and 6.15,
acquired with the proceeds of a loan described in Section 4.5 hereof, may be
subject to a put, call, or other option, or buy-sell or similar arrangement when
held by and when distributed from the Trust Fund, whether or not the Plan is
then an ESOP. The protections and rights shall continue to exist under the terms
of this Plan so long as any Company Stock acquired with the proceeds of a loan
described in Section 4.5 hereof is held by the Trust Fund or by any Participant
or other person for whose benefit such protections and rights have been created,
and neither the repayment of such loan nor the failure of the Plan to be an
ESOP, nor an amendment of the Plan shall cause a termination of said protections
and rights.
6.17 LOANS TO PARTICIPANTS
(a) Effective as soon as administratively practicable after the
completion of the Employer's initial public offering of the Company Stock, Plan
loans shall be available under this Plan. The Administrator shall have the
authority to administer the loan program provided under the Plan. Such authority
shall include, without limitation, the authority to (i) approve or deny loan
applications, (ii) establish limitations on the amount or terms of a loan, (iii)
determine the rate of interest and the collateral for each loan, and (iv) call a
loan into default and take all actions necessary or appropriate to preserve Plan
assets in the event of such default.
(b) Prior to requesting and obtaining a loan under this Plan, a
Participant first shall exhaust his rights to a Plan loan under the Sawtek Inc.
Code ss.401(k) Profit Sharing Plan and Trust. Loans shall be available to all
Participants of the Plan provided they are employees of the Employer on the date
the loan is made. Any Participant may request a loan from the Plan in writing by
delivering a written request to the Administrator on a form prescribed by the
Employer. The Administrator shall then approve or deny such loan application
within 30 days of the receipt thereof.
In the event the loan is approved, the Participant shall execute a
promissory note, security agreement, an authorization to withhold loan
repayments from the Participant's regular paycheck from the Employer, and such
other documents as shall be required by the Administrator.
Any loan that is approved shall be treated as a segregated, directed
investment under Article III (for purposes of crediting earnings) for the
benefit of only the borrowing Participant.
(c) Plan loans shall be approved if the following criteria are met
by the Participant requesting the loan:
(1) The sum of all the Participant's (and spouse's) monthly debt payments
(including principal and interest payments on mortgage loans, car loans, credit
cards and other unsecured or secured debt obligations), plus the monthly
amortization of the Participant's Plan loan then being requested shall not
exceed 45% of the Participant's (and spouse's) gross monthly income (computed
before any Internal Revenue Code ss.ss. 401(k) or 125 salary deferrals). The
Participant shall certify this to the Administrator at the time the loan is
requested.
(2) The loan does not exceed the maximum loan limitations in paragraph (d)
below.
(3) The Participant does not have any other loans outstanding from the Plan
at the time the Participant applies for the loan.
(4) The loan is repaid in level payments of principal and interest over a
period not to exceed five (5) years, by payroll deduction from the Participant's
regular paychecks.
(5) The loan satisfies the provisions otherwise provided in this section as
to interest rate, collateral and documentation.
(6) The Participant agrees to pay (or have deducted) all fees and
documentary stamps associated with the loan, whether incurred at the time of the
loan or on an annual basis.
(d) The maximum dollar amount of any Plan loan to a participant, when
added to plan loans from any other qualified plans maintained by the Employer,
shall not exceed the lesser of -
(1) $50,000, reduced by the excess (if any) of -
(i) the highest outstanding balance of loans from the Plan to the
Participant during the one year period ending on the day before the date of the
loan, over
(ii) the outstanding balance of loans from the Plan to the Participant on
the date of the loan; or (2) One-half of the Participant's Vested Aggregate
Account balance.
The minimum dollar amount of any Plan loan to a Participant shall be
$1,000. For purposes of this minimum loan amount, no other loans from the Plan
to the Participant shall be aggregated.
No loans shall be made from the Plan if the rate of interest determined
pursuant to paragraph (e) below would exceed the state usuary rate at the time
the loan would be made.
(e) The Administrator, at the time a loan is to be closed, shall
determine the rate of interest on the Plan loan by contacting a national bank
doing business in Orange county, Florida and determining such bank's then
prevailing interest rate on loans of similar length of time and repayment terms,
that are backed by certificates of deposit, marketable securities or government
obligations, and that involve the same degree of creditworthiness.
(f) All loans shall be evidenced by a promissory note executed by the
Participant in favor of the Trustee of the Plan. In addition, the loan shall be
secured by a grant by the Participant to the Trustee of a security interest in
50% of the Participant's Vested Aggregate Account balance in the Plan. Such
security interest shall be evidenced by a duly executed security agreement and,
if the Administrator requests, an executed and filed Form UCC-1 Financing
Statement. The Plan shall have a right to offset the amount of any loan,
including interest and collection costs, against any amount distributable to or
on behalf of the Participant or his Beneficiary.
(g) In the event the Participant fails to pay any principal or
interest when due, the Plan loan shall be considered in default 60 days after
the date such payment was due. Unless prohibited by the Code or Regulations, the
loan shall then be foreclosed, and the amount of the loan treated as a deemed,
in service distribution to the Participant of the entire amount of the unpaid
principal and accrued interest (plus collection costs).
ARTICLE VII.
TOP HEAVY RULES
7.1 DEFINITIONS
For purposes of this Article VII, and this Agreement, the following
capitalized terms shall have the following meanings:
(a) "Aggregation Group" means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter defined.
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.
An Aggregation Group shall include any terminated qualified retirement
plan of the Employer that was maintained by the Employer within the last five
year period ending on the Determination Date.
(b) "Determination Date" means the last day of the preceding Plan
Year.
(c) "Five Percent Owner" means any person who owns (or is considered
as owning within the meaning of Code ss. 318) more than 5% of the outstanding
stock of the Employer or stock possessing more than 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 5% of the capital or profits interest in
the Employer. In determining percentage ownership hereunder, employers that
would otherwise be aggregated under Code ss.ss. 414(b), (c), (m), or (o) shall
be treated as separate employers.
(d) "Key Employee" means those Employees defined in Code ss. 416(i) and
the Regulations thereunder. Generally, the term includes any Employee or former
Employee (and his Beneficiaries) who, at any time during the Plan Year or any of
the preceding four Plan Years, is:
(a) An officer of the Employer (as that term is defined within the
meaning of the Regulations under Code ss. 416) having Compensation in excess of
50% of the amount in effect under Code ss. 415(b)(1)(A) for the Plan Year. For
purposes of this definition, no more than 50 Employees (or if less, the greater
of three Employees or ten percent of the Employees) shall be treated as
officers, and Employees described in Code ss. 414(q)(8) shall be excluded as
officers.
(b) One of the 10 Employees having Compensation greater than the
amount in effect under Code ss. 415(c)(1)(A), and owning (or considered as
owning within the meaning of Code ss. 318) both more than a one-half percent
interest in the Employer or Affiliated Employer, and one of the 10 largest
interests in the Employer or Affiliated Employer.
(c) A "Five Percent Owner" of the Employer.
(d) A "one percent owner" of the Employer having Compensation from the
Employer of more than $150,000.00 for the Plan Year. "One percent owner" means
any person who owns (or is considered as owning within the meaning of Code ss.
318) more than one percent of the outstanding stock of the Employer or stock
possessing more than one percent of the total combined voting power of all the
stock of the Employer. For purposes of this definition, the rules of subsections
(b), (c) and (m) of Code ss. 414 shall not apply in determining ownership.
However, in determining whether an individual has Compensation of more than
$150,000.00, Compensation from each employer required to be aggregated under
Code ss. 414(b), (c) and (m) shall be taken into account.
(e) "Non-Key Employee" means any Employee or former Employee (and his
Beneficiaries) who is not a Key Employee.
(f) "Permissive Aggregation Group" means an Aggregation Group,
selected by the Employer that includes any 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 ss.ss. 401(a)(4) and 410 of the
Code.
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.
(g) "Required Aggregation Group" means an Aggregation Group which
includes a plan of the Employer in which a Key Employee is a Participant, and
each other plan of the Employer which enables any plan in which a Key Employee
participates to meet the requirements of Code ss.ss. 401(a)(4) or 410.
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.
(h) "Super Top Heavy Plan" means a plan described in Section 7.3(b).
(i) "Top Heavy Plan" means a plan described in Section 7.3(a).
(j) "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 pension plans included in the group; plus
(2) The aggregate accounts of Key Employees under all defined contribution
plans included in the group;
exceeds 60% of a similar sum determined for all Participants.
(k) "Top Heavy Plan Year" means that, for a particular Plan Year, the
Plan is a Top Heavy Plan.
7.2 TOP HEAVY PLAN REQUIREMENTS
(a) For any Top Heavy Plan Year, the Plan shall provide the following:
(1) Special vesting requirements of Codess.416(b) pursuant to Section 7.5
of the Plan; and
(2) Special minimum contribution and allocation requirements of
Codess.416(c) pursuant to Section 7.4 of the Plan.
7.3 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, the sum of:
(1) the present value of accrued benefits of Key Employees, plus
(2) the Participant's Employer Accounts of Key Employees under this Plan
and the aggregate accounts of Key Employees in all plans of an Aggregation
Group,
exceeds 60% of the sum of:
(1) the present value of accrued benefits of all Key Employees and Non-Key
Employees, plus
(2) the Participant's Employer Accounts of all Key Employees and Non-Key
Employees under this Plan and the aggregate accounts in 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 Participant's Employer Account and
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, the present value of accrued benefit and/or
Participant's Employer Account or other aggregate account 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, the sum of:
(1) the present value of accrued benefits of Key Employees, plus
(2) the Participant's Employer Accounts of Key Employees under this Plan
and the aggregate accounts of Key Employees in all plans of an Aggregation
Group, exceed 90% of the sum of:
(1) the present value of accrued benefits of all Key Employees and Non-Key
Employees, plus
(2) the Participant's Employer Accounts of all Key Employees and Non-Key
Employees under this Plan and the aggregate accounts in all plans of an
Aggregation Group.
7.4 REQUIRED MINIMUM ALLOCATIONS
(a) Notwithstanding Section 3.3 for any Top Heavy Plan Year, the sum
of the Employer's Profit Sharing Contributions and Forfeitures allocated to the
Participant's Employer Account of each Non-Key Employee shall be equal to 3% of
such Non-Key Employee's Compensation (reduced by contributions and forfeitures,
if any, allocated to each Non-Key Employee in any other defined contribution
plan included with this Plan in a Required Aggregation Group). However, if (i)
the sum of the Employer's Profit Sharing Contribution and Forfeitures allocated
to the Participant's Employer Account of each Key Employee's Compensation, and
(ii) this Plan is not required to be included in an Aggregation Group to enable
a defined benefit plan to meet the requirements of Code ss.ss. 401(a)(4) and
410, then the sum of the Employer's Profit Sharing Contribution and Forfeitures
allocated to the Participant's Employer Account of each Non-Key Employee shall
be equal to the largest percentage allocated to the Participant's Employer
Account of any Key Employee.
(b) Notwithstanding the above provisions of this Section 7.4, no such
minimum allocation shall be required for any Non-Key Employee who participates
in another defined contribution plan subject to Code ss. 412 included with this
Plan in a Required Aggregation Group, if the minimum benefit is provided by such
other defined contribution plan.
(c) For purposes of the above paragraph, the percentage allocated to
the Participant's Employer Account of any Key Employee shall be equal to the
ratio of the Employer's Profit Sharing Contribution and Forfeitures allocated on
behalf of such Key Employee divided by the Compensation for such Key Employee.
(d) For any Top Heavy Plan Year, the minimum allocations set forth
above shall be allocated to the Participant's Employer Account of all Non-Key
Employees who are Participants and who are employed by the Employer on the last
day of the Plan Year, including Non-Key Employees who have failed to complete
500 Hours of Service.
(e) In lieu of the above, in any Plan Year in which a Non-Key Employee
is a Participant in both this Plan and a defined benefit pension plan included
in a Required Aggregation Group which is top heavy, the Employer shall not be
required to provide such Non-Key Employee with both the full separate defined
benefit plan minimum benefit and the full separate defined contribution plan
minimum allocation. The minimum allocation will not be provided by this Plan.
7.5 TOP HEAVY VESTING SCHEDULE
Notwithstanding the vesting schedule in Section 6.4, for any Top Heavy
Plan Year, the Vested portion of any Participant's Employer Account shall be a
percentage of the totalamount credited to such accounts 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 or more 100%
ARTICLE VIII.
ADMINISTRATION
8.1 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 and to assure that the Plan is being operated for the
exclusive benefit of the Participants and their Beneficiaries in accordance with
the terms of this 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. However, 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 "funding policy and method" shall not
constitute a directive to the Trustee as to the 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.
(c) The Employer may, in its discretion, appoint an Investment Manager
to manage all or a designated portion of the assets of the Plan. In such event,
the Trustee shall follow the directive of the Investment Manager in investing
the assets of the Plan managed by the Investment Manager, provided that such
direction is made in accordance with the terms and objectives of this Plan and
are not contrary to the Act.
8.2 ASSIGNMENT AND DESIGNATION OF ADMINISTRATIVE AUTHORITY
The Employer may appoint one or more individuals to serve as
Administrator. Any person, including but not limited to, the Employees of the
Employer, shall be eligible to serve as an Administrator or on a committee
designated as the Administrator.
Any Administrator or member of an administrative committee may resign
by delivering his written resignation to the Employer, or be removed by the
Employer by delivery of a 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 or
committee member, shall promptly designate in writing a successor to this
position.
If the Employer does not appoint an individual or committee as
Administrator, or if the committee is without members, the Employer shall
function as the Administrator.
8.3 ALLOCATION AND DELEGATION OF RESPONSIBILITIES
In the event a committee is appointed by the Employer to serve as
Administrator, the members of the committee may allocate the responsibilities of
the Administrator among themselves, in which event the members of the committee
shall notify the Employer and the Trustee in writing of such action and specify
the responsibilities of each member. The Trustee, and other parties dealing with
the Administrator, thereafter shall accept and rely upon any instruction by the
appropriate individual until such time as the Employer or the committee file
with the Trustee, or third party, a written revocation of such designation.
8.4 POWERS, DUTIES AND RESPONSIBILITIES
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 Act and the Code. The
Administrator shall administer the Plan in accordance with its terms and shall
have the discretionary power 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, in its discretion, 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 this Plan; provided, however, that any procedure, discretionary
act, discretionary interpretation or construction shall be done in a
non-discriminatory 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 ss. 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) To determine, in its discretion, all questions relating to the
eligibility of Employees to participate or remain a Participant hereunder, based
upon information furnished by the Employer;
(b) To compute, certify, and direct the Trustee with respect to the
amount and kind of benefits to which any Participant shall be entitled
hereunder;
(c) To authorize and direct the Trustee with respect to
all non-discretionary or otherwise directed disbursements from the Trust;
(d) To maintain all necessary records for the administration of the
Plan;
(e) To interpret or construe, in its discretion, 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 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
Trust Fund;
(g) To consult with the Employer and the Trustee regarding the short
and long-term liquidity needs of the Plan in order for the Trustee to exercise
any investment discretion in a manner designed to accomplish specific
objectives;
(h) To assist any Participant regarding his rights, benefits, or
elections available under the Plan;
(i) To establish and communicate to Participants a procedure, which
includes at least three investment options, for the diversification of their
Participant's Company Stock Account pursuant to Section 3.7; and
(j) To establish and communicate to Participants a procedure and
method to insure that each Participant may vote his Company Stock allocated to
his Participant's Company Stock Account.
8.5 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 the 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.
8.6 ANNUAL REPORT
The Administrator shall, as soon as possible after each Anniversary
Date, but in any event no later than 210 days thereafter, furnish each
Participant with a written statement showing:
(a) The balance in his Participant's Employer Account as of the pre-
ceding Anniversary Date.
(b) The amount of Employer contributions and Forfeitures allocated to
his Participant's Employer Account for the Plan Year.
(c) The adjustment to his Participant's Employer Account to reflect
his share of dividends and the income and expenses of the Trust Fund for the
Plan Year.
(d) The Participant's balance in his Company Stock Account,
Other Investments Account and Qualified Directed Investment Account.
(e) Such other information as may be required by the Act or Code.
8.7 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.
8.8 INFORMATION FROM EMPLOYER
To enable the Administrator to perform its 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, Total and Permanent 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.
8.9 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. Also, the Employer may, in its discretion, and
on a uniform and nondiscriminatory basis, reimburse the Trust Fund only for the
portion of such Expenses allocable to Participants, and direct the Trustee that
the portion of expenses allocable to Former Participant's be paid by the Trust
Fund and debited to such Former Participant's Employer Account. Any
administration expense paid to the Trust Fund as a reimbursement shall not be
considered an Employer contribution.
8.10 MAJORITY ACTIONS
Except where there has been an allocation and delegation of
administrative authority pursuant to Section 8.3, if there shall be more than
one Administrator, or if the Administrator is a committee, the Administrators or
committee members, as the case may be, shall act by a majority of their number,
but may authorize one or more of them to sign all papers on their behalf.
8.11 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.
8.12 CLAIMS REVIEW PROCEDURE
Any Participant or Former Participant, or Beneficiary of either, who
has been denied a benefit or has been determined to be ineligible to participate
in the Plan or remain a Participant in the Plan, by a decision of the
Administrator pursuant to Section 8.11, 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 8.11. 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 claimant shall have
an opportunity to it written and oral evidence and arguments in support of his
claim. At the hearing (or prior thereto, upon five 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
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 in writing to the claimant within the 60-day period). The final
decision 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 IX.
TRUSTEE
9.1 BASIC RESPONSIBILITIES OF THE TRUSTEE
The Trustee shall have the following categories of responsibilities:
(a) Consistent with any funding policy and method determined by the
Employer and consistent with Article IV, to invest, manage, and control the Plan
assets subject, however, to any direction of an Investment Manager if the
Employer should appoint such manager as to all or a portion of the assets of the
Plan in accordance with the provision of Section 8.1(c).
(b) At the direction of the Administrator, to pay benefits required
under the Plan to be paid to Participants, Former 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 Fiscal Year a written annual report
in accordance with Section 9.7.
(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.
9.2 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 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 the "funding policy and
method" and other 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 this Plan may qualify as an
employee stock ownership plan.
(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.
(c) The Trustee may from time to time transfer to a common,
collective, group or pooled trust fund maintained by any bank or trust company,
including the Trustee or an affiliate thereof, all or such part of the Trust
Fund as the Trustee may deem advisable, and such part or all of the Trust Fund
so transferred shall be subject to all the terms and provisions of the
common,collective, group or pooled trust fund which contemplate the commingling
for investment purposes of such Trust Fund assets with trust assets of other
trusts. The Trustee may from time to time withdraw from such common, group,
collective, or pooled trust fund all or such part of the Trust Fund as the
Trustee may deem advisable.
9.3 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 this
Agreement, 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 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.
(c) Subject to Section 9.4, to vote upon any stocks, including Company
Stock, 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 agents or in
the name of the Trustee's or agent's nominee or 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, expedience, 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.
(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 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 of insurance (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 of insurance; and 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.
(l) 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 deposit monies in federally insured savings accounts or
certificates of deposit in banks or savings and loan associations.
(o) To vote Company Stock as provided in Section 9.4.
(p) To consent to or otherwise participate in reorganizations,
recapitalizations, consolidations, mergers and similar transactions with respect
to Company Stock or any other securities and to pay any assessments or charges
in connection therewith.
(q) To deposit such Company Stock (but only if such deposit does not
violate the provisions of Section 9.4 hereof) or other securities in any voting
trust, or with any protective or like committee, or with a trustee or with
depositories designated thereby.
(r) To sell or exercise any options, subscription rights and
conversion privileges and to make any payments incidental thereto.
(s) To pool all or any part of the Trust Fund, from time to time, with
assets belonging to any other qualified employee pension benefit trust created
by the Employer or an Affiliated 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.
(t) 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.
9.4 VOTING COMPANY STOCK
The Trustee shall vote all Company Stock held by it as part of the
Plan's assets. Provided, however, that if any agreement entered into by the
Trust provides for voting of any shares of Company Stock pledged as security for
any obligation of the Plan, then such shares of Company Stock shall be voted in
accordance with such agreement. The Trustee shall not vote Company Stock which
has been allocated to a Participant's Company Stock Account and which
Participant or Beneficiary, pursuant to this Section, fails to vote. However,
the Trustee shall vote all Common Stock, in its discretion, held in the
Unallocated Company Stock Suspense Account.
Notwithstanding the foregoing, and provided the Trust Fund acquires
securities of the Employer amounting to more than ten percent (10%) of the total
assets of the Trust Fund, if the Employer has a registration-type class of
securities, each Participant or Beneficiary shall be entitled to direct the
Trustee as to the manner in which the Company Stock which is entitled to vote
and which is allocated to the Company Stock Account of such Participant or
Beneficiary is to be voted. If the Employer does not have a registration-type
class of securities, each Participant or Beneficiary in the Plan shall be
entitled to direct the Trustee as to the manner in which voting rights on shares
of Company Stock which are allocated to the Company Stock Account of such
Participant or Beneficiary are to be exercised with respect to any corporate
matter which involves the voting of such shares with respect to the approval or
disapproval of any corporate merger or consolidation, recapitalization,
reclassification, liquidation, dissolution, sale of substantially all assets of
a trade or business, or such similar transaction as prescribed in Regulations.
For purposes of this Section the term "registration-type class of securities"
means: (A) a class of securities required to be registered under Section 12 of
the Securities Exchange Act of 1934; and (B) a class of securities which would
be required to be so registered except for the exemption from registration
provided in subsection (g)(2)(H) of such Section 12.
9.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS
(a) The Trustee shall make distributions from the Trust Fund at such
times and in such numbers of shares or other units of Company Stock and amounts
of cash to or for the benefit of the person entitled thereto under the Plan as
the Administrator directs in writing. Any undistributed part of a Participant's
interest in his Participant Employer Account shall be retained in the Trust Fund
until the Administrator directs its distribution. Where distribution is
directedin Company Stock, the Trustee shall cause an appropriate certificate to
be issued to the person entitled thereto and mailed to the address furnished it
by the Administrator. Any portion of a Participant's Employer Account to be
distributed in cash shall be paid by the Trustee mailing its check to the same
person at the same address. If a dispute arises as to who is entitled to or
should receive any benefit or payment, the Trustee may withhold or cause to be
withheld such payment until the dispute has been resolved.
(b) As directed by the Administrator, the Trustee shall make payments
out of the Trust Fund. Such directions or instructions need not specify the
purpose of the payments so directed and the Trustee shall not be responsible in
any way respecting the purpose or propriety of such payments except as mandated
by the Act.
(c) In the event that any distribution or payment directed by the
Administrator shall be mailed by the Trustee to the person specified in such
direction at the latest address of such person filed with the Administrator, and
shall be returned to the address of such person filed with the Administrator,
and shall be returned to the Trustee because such person cannot be located at
such address, the Trustee shall promptly notify the Administrator of such
return. Upon the expiration of sixty (60) days after such notification, such
direction shall become void and unless and until a further direction by the
Administrator is received by the Trustee with respect to such distribution or
payment, the Trustee shall thereafter continue to administer the Trust as if
such direction had not been made by the Administrator. The Trustee shall not be
obligated to search for or ascertain the whereabouts of any such person.
9.6 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
Employee serving as Trustee who already receives full-time pay from the Employer
shall not receive compensation from this 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. If the Trust Fund is
insufficient to pay such compensation and expenses, the Employer shall pay any
unpaid portion. 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. The
Employer shall indemnify the Trustee for the payment of all reasonable costs and
expenses, including counsel, accountant or other advisor fees, incurred in the
defense, settlement or other disposition of any charge or claim brought against
the Trustee in its capacity as Trustee, provided however, if the Trustee is
determined to have breached its fiduciary duty, to have been grossly negligent,
or to have engaged in willful misconduct, no indemnification shall be in favor
of the Trustee.
9.7 ANNUAL REPORT OF THE TRUSTEE
Within 90 days after the later of the Anniversary Date or receipt of
the Employer's contribution for each Fiscal Year, the Trustee shall furnish to
the Employer and Administratora written statement of account with respect to the
Fiscal Year for which such contribution was made setting forth:
(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 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.
9.8 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
standings, 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 each of the following statements, schedules or lists, or
any others that are required by ss. 103 of the Act or the Secretary of Labor to
be filed with the Plan's annual report, are presented fairly in conformity with
generally accepted accounting principles applied consistently:
(1) Statement of the assets and liabilities of the Plan;
(2) Statement of changes in net assets available to the Plan;
(3) Statement of receipts and disbursements, a schedule of all assets held
for investment purposes, a schedule of all loans or fixed income obligations in
default at the close of the Plan Year;
(4) A list of all leases in default or uncollectible during the Plan Year;
(5) The most recent annual statement of assets and liabilities of any bank,
common or collective Trust Fund in which Plan assets are invested or such
information regarding separate accounts of trusts with a bank or insurance
company as the Trustee and Administrator deem necessary; and
(6) A schedule of each transaction or series of transactions involving an
amount in excess of 5% of Plan assets.
All auditing and account 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 ss. 103 of the Act 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 ss.
103(b) of the Act within 120 days after the end of the Plan Year or such other
date as may be prescribed under regulations of the Secretary of Labor.
9.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE
(a) The Trustee may resign at any time by mailing by certified mail or
by in hand delivery 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 certified mail
or by in hand delivery, addressed to such Trustee at his last known address, a
written notice of his removal, stating the effective date of the removal, which
shall be at least thirty (30) days prior to the effective date.
(c) Upon the death, resignation, incapacity, or removal of any
Trustee, a successor shall 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 in all the estate, rights, powers,
discretions, and duties of his predecessor with like respect as if he were
originally named as Trustee herein. Until such a successor is appointed, the
remaining Trustee or Trustees shall have full authority to act under the terms
of this 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 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 ofthe Fiscal Year during which he served as Trustee. This
statement shall be either (1) included as part of the annual statement of
account for the Fiscal Year required under Section 9.7, or (2) 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 Fiscal Year. The procedures set forth in Section 9.7 for the approval by the
Employer of annual statements of accounts 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 9.7 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 9.7 and this subparagraph.
ARTICLE X.
AMENDMENT, TERMINATION, AND MERGERS
10.1 AMENDMENT
(a) The Employer shall have the right at any time to amend this
Agreement, subject to the limitations of this Section 10.1. However, no such
amendment shall authorize or permit 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 purposes other than for the exclusive benefit of the Participants or
their Beneficiaries or estates; no such amendment shall cause any reduction in
the amount credited to the account of any Participant or cause or permit any
portion of the Trust Fund to revert to or become the property of the Employer;
and no such amendment which affects the rights, duties or responsibilities of
the Trustee and Administrator may be made without the Trustee's and
Administrator's written consent. Any such amendment shall become effective as
provided therein upon its execution.
(b) Except as permitted by Code ss.411(d)(6) (including the special
ESOP rules of Code ss.411(d)(6)(C) and Regulations thereunder (including
Regulation ss. 1.411(d)-4)), no Plan amendment or transaction having the effect
of a Plan amendment (such as a merger, plan transfer or similar transaction)
shall be effective if it eliminates or reduces any "Code ss. 411(d)(6) protected
benefit" or adds or modifies conditions relating to "Code ss. 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 or effective date of the amendment.
Code ss. 411(d)(6) protected benefits" are benefits described in Code ss.
411(d)(6)(A), early retirement benefits and retirement-type subsidies, and
optional forms of benefit.
(c) No amendment shall have the effect of terminating the protections
and rights set forth in Article VI, unless such termination shall then be
permitted under the applicable provisions of the Code and Regulations; including
Regulation ss. 54.4975-11(a)(3)(ii).
10.2 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. The Plan shall also terminate upon complete discontinuance of
contributions by the Employer. Upon any termination (full or partial), all
amounts credited to any affected Participant's Employer Account shall become
100% Vested and shall not thereafter be subject to Forfeiture and all
unallocated amounts of Company Stock shall be allocated to the Participants'
Employer Accounts of all Participants in accordance with the provisions hereof.
Upon such termination of the Plan or complete discontinuance of contributions,
the Employer, by written notice to the Trustee and Administrator, may direct
either:
(1) Complete distribution of the assets in the Trust Fund to the
Participants in cash or in kind, in the form provided in Section 6.5 as soon as
the Administrator deems it to be in the best interests of the Participants, but
in no event later than two years after such termination; or
(2) Continuation of the Trust created by this Agreement and the
distribution of benefits pursuant to Article VI at such time and in such manner
as though the Plan had not been terminated.
(b) Except as is permitted by Regulations, the termination of the
Plan shall not result in the reduction of Code ss. 411(d)(6) protected bene-
fits in accordance with Section 10.1(b).
10.3 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 Code ss. 411(d)(6) protected
benefits in accordance with Section 10.1(b).
ARTICLE XI
MISCELLANEOUS
11.1 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 theEmployer 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.
11.2 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, for any reason, under any provision of this
Agreement. 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 indebtedness shall be paid or offset by the Trustee to the Trustee or the
Administrator, at the direction of the Administrator, to apply against, offset
or discharge such indebtedness. Prior to making a payment, however, the
Participant or Beneficiary must be given written notice by the Administrator
that such indebtedness is to be paid in whole or in part from his Participant's
Employer Account. If the Participant or Beneficiary does not agree that the
indebtedness is a valid claim against his Vested Participant's Employer Account,
he shall be entitled to a review of the validity of the claim in accordance with
procedures provided in Sections 8.11 and 8.12.
(c) This provision shall not apply to a "qualified domestic relations
order" defined in Code ss. 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 this Plan.
11.3 CONSTRUCTION OF AGREEMENT
This Plan shall be construed and enforced according to the Act, the
Code and the laws of the State of Florida, other than its laws respecting choice
of law, to the extent not preempted by the Act or the Code.
11.4 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 shallbe construed as though they
were also used in the other form in all cases where they would so apply.
11.5 LEGAL ACTION
In the event any claim, suit, or proceeding is brought regarding the
Plan to which the Trustee or the Administrator may be a party, and such claim,
suit, or proceeding is resolved in favor of that 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.
11.6 PROHIBITION AGAINST DIVERSION OF FUNDS OR FORFEITURE FOR CAUSE
Except as provided below and otherwise specifically permitted by law,
it shall be impossible by operation of the Plan, by termination thereof, 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, Former Participants, or their Beneficiaries.
11.7 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 $1,000.00 and the maximum bond
$500,000.00. 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 Plan 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 ss. 412(a)(2) of the Act), and the bond shall be in a form
approved by the Secretary of Labor. Notwithstanding anything in this Agreement
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.
11.8 RECEIPT AND RELEASE FOR PAYMENTS
Any payment to any Participant, Former Participant, his legal
representative, Beneficiary, or to any guardian, parent or committee appointed
for such Participant, Former Participant or Beneficiary in accordance with the
provisions of this Agreement, shall, to the extent thereof, be in full
satisfaction of all claims hereunder against the Trustee, Administrator and the
Employer, any of whom may require such Participant, Former Participant, legal
representative, Beneficiary, guardian, parent or committee, as a condition
precedent to such payment, to executea receipt and release thereof in such form
as shall be determined by the Trustee, Administrator or Employer.
11.9 ACTION BY THE EMPLOYER
Whenever the Employer, under the terms of this Agreement, 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.
11.10 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
The "named Fiduciaries" of this Plan are (a) the Employer, (b) the
Administrator, (c) the Trustee, and (d) any Investment Manager appointed
hereunder. The named Fiduciaries shall have only those specific powers, duties,
responsibilities, and obligations as are specifically given them under this
Agreement. In general, the Employer shall have the sole responsibility for
making the contributions provided for under Section 3.1; the sole authority to
appoint and remove the Trustee, the Administrator, and any Investment Manager
which may be provided for under this Agreement; to formulate the Plan's "funding
policy and method"; and to amend or terminate, in whole or in part, this
Agreement. The Administrator shall have the sole responsibility for the
administration of this Agreement, which responsibility is specifically described
in this Agreement. 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
this Agreement. Each named Fiduciary warrants that any directions given,
information furnished, or action taken by it shall be in accordance with the
provisions of this Agreement, authorizing or providing for such direction,
information or action. Furthermore, each named Fiduciary may rely upon any such
direction, information of action of another named Fiduciary as being proper
under this Agreement, and is not required under this Agreement to inquire into
the property of any such direction, information or action. It is intended under
this Agreement that each named Fiduciary shall be responsible for the proper
exercise of its own powers, duties, responsibilities and obligations under this
Agreement. 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 that one Fiduciary capacity.
11.11 HEADINGS
The headings and subheadings of this Agreement have been inserted for
convenience of reference and are to ignored in any construction of the
provisions hereof.
11.12 UNIFORMITY
All provisions of this Plan shall be interpreted and applied in a
uniform, non-discriminatory manner.
IN WITNESS WHEREOF, this Agreement has been executed the day and year
first above written.
EMPLOYER:
SAWTEK INC.
By:/s/Steven P. Miller
Steven P. Miller, President
<PAGE>
ACCEPTANCE BY TRUSTEE
The undersigned Trustees hereby accept the foregoing amendment and
restatement of the Plan, and agree to continue to serve as a Trustee of the
Plan. This acceptance is dated effective as of February 15, 1996.
SOUTHTRUST TRUST AND INDIVIDUAL TRUSTEES
ESTATE COMPANY
By: /s/ Bernard Stephenson /s/Steven P. Miller
L. Bernard Stephenson Steven P. Miller, Trustee
Senior Vice President
Corporate Trustee
/s/Neal Jay Tolar
Neal Jay Tolar, Trustee
/s/Thomas L. Shoquist
Thomas L. Shoquist, Trustee
/s/Robert C. Strandberg
Robert C. Strandberg, Trustee
<PAGE>
EXHIBIT 99.2
SAWTEK INC.
RESOLUTIONS ADOPTED AT THE MEETING OF
BOARD OF DIRECTORS HELD APRIL 27, 1996
RESOLVED, that the Employee Stock Ownership Plan and Trust Agreement
for Employees of Sawtek Inc. (the "ESOP") shall be valued as of April 28, 1996
in accordance with Sections 1.52 and 5.1 of the ESOP, and these resolutions.
RESOLVED, that notwithstanding Sections 1.15, 2.1 and 2.2 of the ESOP,
all Employees of the Company hired from October 1, 1995 through and including
April 28, 1996 shall become Eligible Employees and Participants in the ESOP as
of their effective date of employment with the Employer, without having to meet
the 500 Hour of Service requirement of Section 2.1 of the ESOP.
RESOLVED, that the Company Stock currently held in the Unallocated
Company Stock Suspense Account that was acquired by the ESOP with the proceeds
of that certain bank loan that was repaid to SunBank, N.A. on December 22, 1995,
shall be allocated to all Participants in the Plan as of April 28, 1996.
RESOLVED, that the foregoing resolution shall not relate to the
allocation of Forfeitures, which shall be allocated in accordance with the terms
of the ESOP as of the next following Anniversary Date.
RESOLVED, that the last day of the Plan Year requirement and 500 Hour
of Service requirement of Section 3.3(b)(2) shall not apply to the allocation of
Company Stock to be made as of April 28, 1996, and the Company Stock to be
allocated as of April 28, 1996 shall be allocated based upon the Participants'
relative Compensation from October 1, 1995 through and including April 28, 1996.
For purposes of this computation, the $150,000 compensation limit of Code
Section 401(a)(17) and ESOP Section 1.10 shall be adjusted to reflect a
determination period of less than 12 months.
RESOLVED, that subsequent to April 28, 1996, the eligibility,
participation, Compensation and allocation provisions of the ESOP shall be
applied as adopted by the Board as of February 15, 1996, except to the extent
the ESOP may be further amended by the Board from time to time.
RESOLVED, that except where specifically defined herein, terms and
phrases capitalized in these resolutions shall be as defined in the ESOP.
RESOLVED, that these resolutions shall constitute an amendment to the
ESOP to the extent an amendment is required and no further action by the
Trustees of the ESOP is necessary to effectuate this amendment.
