<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 14, 1997
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
APPALACHIAN BANCSHARES, INC.
-----------------------------------------------------------------
(Exact Name of Registrant as Specified in its Charter)
Georgia 58-2242407
- ---------------------------------- ----------------------------------------
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
315 Industrial Boulevard
Ellijay, Georgia 30540
--------------------------------------------------
(Address of Principal Executive Offices)
APPALACHIAN BANCSHARES, INC.
1997 EMPLOYEE STOCK INCENTIVE PLAN
and
APPALACHIAN BANCSHARES, INC.
1997 DIRECTORS' NON-QUALIFIED STOCK OPTION PLAN
and
APPALACHIAN BANCSHARES, INC.
SECTION 401(K) PROFIT SHARING PLAN
(Full Title of the Plans)
copy to:
Tracy R. Newton
315 Industrial Boulevard Walter E. Jospin, Esq.
Ellijay, Georgia 30540 Troutman Sanders LLP
(Name and Address of Agent for Service) 600 Peachtree Street, N.E.
Suite 5200, NationsBank Plaza
(706) 276-8000 Atlanta, Georgia 30308-2216
(Telephone Number, Including Area Code,
of Agent for Service) (404) 885-3000
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------
CALCULATION OF REGISTRATION FEE
- ---------------------------------------------------------------------------------------------------------------------
Proposed maximum Proposed maximum
Title of securities Amount to be offering price per aggregate offering Amount of registration
to be registered registered (1)(2) share (3) price (3) fee (3)
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par
value $5 per share 100,000 shares (4) $10.83 $1,083,000 $328.18
100,000 shares (5) 1,083,000 $328.18
100,000 shares (6) 1,083,000 $328.18
- ---------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Pursuant to Rule 416(a) of the Securities Act of 1933, as amended
(the "Securities Act"), this registration statement also covers an
indeterminate number of additional shares which may be offered and issued to
prevent dilution resulting from stock splits, stock dividends or similar
transactions as provided in the above-referenced plans.
(2) Pursuant to Rule 416(c) of the Securities Act, this registration
statement also covers an indeterminate amount of interests to be offered or
sold pursuant to the Appalachian Bancshares, Inc. Section 401(k) Profit Sharing
Plan.
(3) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(h) based on the book value of the Common Stock of
Appalachian Bancshares, Inc. on May 13, 1997.
(4) Attributable to the Employee Stock Incentive Plan.
(5) Attributable to the Director's Non-Qualified Stock Option Plan.
(6) Attributable to the Seciton 401(K) Profit Sharing Plan.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The undersigned registrant (the "Company" or "Registrant") hereby
incorporates by reference into this registration statement the following
documents:
(a) The Registrant's Annual Report on Form 10-KSB for
the fiscal year ended December 31, 1996; and
(b) The description of the Registrant's capital stock
contained in its registration statement on Form 8-A, filed
under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), including any amendment or report filed for
the purpose of updating such description.
In addition, all documents filed subsequent to the date of this
registration statement by the Registrant pursuant to Sections 13(a), 13(c), 14
and 15(d) of the Exchange Act, and prior to the filing of a post-effective
amendment hereto which either indicates that all shares of Common Stock offered
hereby have been sold or deregisters any shares of such Common Stock then
remaining unsold, shall be deemed to have been incorporated by reference into
this registration statement.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Under the Georgia Business Corporation Code (the "Georgia Code"),
the Registrant has broad powers to indemnify its directors and officers against
liabilities they may incur in such capacities, including under the Securities
Act of 1933, as amended. Section 14-2-851 of the Georgia Code gives a
corporation power to indemnify or obligate itself to indemnify an individual
made a party to a proceeding because he is or was a director against liability
incurred in the proceeding if he acted in a manner he believed in good faith to
be in or not opposed to the best interests of the corporation and, in the case
of any criminal proceeding, he has no reasonable cause to believe his conduct
was unlawful, except that no indemnification shall be made in connection with a
proceeding by or in the right of the corporation in which the director was
adjudged liable to the corporation or in connection with any other proceeding
in which he was adjudged liable on the basis that personal benefit was
improperly received by him.
II-2
<PAGE> 3
The Registrant's Articles of Incorporation provide that directors
of the Registrant will not be personally liable for monetary damages to the
Registrant or its shareholders for breaches of their fiduciary duty as
directors, except for (i) any appropriation, in violation of a director's
duties, of any business opportunity of the Registrant; (ii) any acts or
omissions not in good faith or which involve intentional misconduct or a knowing
violation of law; (iii) the types of liability set forth on Section 14-2-832, or
any successor section thereto, of the Official Code of Georgia Annotated
(pertaining to unlawful distributions); or (iv) any transaction from which a
director derives an improper material tangible personal benefit.
The Bylaws of the Registrant provide in substance that a director or
officer of the Registrant, or a party serving at the request of the Registrant
as a director or officer of another firm, corporation, trust or other
organization or enterprise, shall be indemnified by the Registrant for any
reasonable expense actually incurred in connection with any threatened, pending
or completed action, suit or proceeding. Provided, however, that (a) such
person shall be entitled to indemnification only upon a resolution of the Board
of Directors finding that such person acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best interests of the
Corporation and with respect to any criminal proceeding, that such person did
not have reasonable cause to believe that his conduct was unlawful; (b) no
person shall be indemnified in relation to any proceeding as to which he shall
finally be adjudged to have been guilty of or liable for gross negligence,
willful misconduct or criminal acts in the performance of his duties; and (c)
no person shall be indemnified in relation to any proceeding which has been the
subject of a compromise settlement, except with the approval of (i) a court of
competent jurisdiction, (ii) the holders of record of a majority of the
outstanding shares of capital stock or (iii) a majority of the members of the
Board of Directors then holding office.
The Registrant has an insurance policy covering its liabilities and
expenses which might arise in connection with its lawful indemnification of its
directors and officers for certain of their liabilities and expenses and also
covering its officers and directors against certain other liabilities and
expenses.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
The undersigned Registrant hereby undertakes that it has submitted
or will submit the Appalachian Bancshares, Inc. 401(k) Profit Sharing Plan (the
"Plan") and any amendment thereto to the Internal Revenue Service ("IRS") in a
timely manner and has made or will make all changes required by the IRS in
order to qualify the Plan under Section 401 of the Internal Revenue Code of
1986, as amended.
II-3
<PAGE> 4
<TABLE>
<CAPTION>
Exhibit
Number Description
------- -----------
<S> <C>
4.1 Appalachian Bancshares, Inc. 1997 Employee Stock Incentive
Plan (filed as Exhibit 10.2 to the Registrant's Form
10-KSB for the fiscal year ended December 31, 1996 the
"1996 Form 10-KSB" and incorporated herein by reference)
4.2 Appalachian Bancshares Inc. 1997 Directors'
Non-Qualified Stock Option Plan (filed as Exhibit 10.1 to
the 1996 Form 10-KSB and incorporated herein by reference)
4.3(a) Adoption Agreement for the Appalachian Bancshares, Inc.
Section 401(k) Profit Sharing Plan
4.3(b) Georgia Bankers Association Master 401(k) Profit Sharing
Plan
5 Opinion of Troutman Sanders LLP
23.1 Consent of Schauer, Taylor, Cox & Edwards, P.C.
23.2 Consent of Troutman Sanders LLP (contained in its opinion
filed as Exhibit 5)
</TABLE>
ITEM 9. UNDERTAKINGS
(a) Rule 415 offerings. The undersigned Registrant
hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration
statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the registration statement. 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 and
of the estimated maximum offering range may be
reflected in the form of prospectus filed with the
Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no
more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of
Registration Fee" table in the effective registration
statement.
II-4
<PAGE> 5
(iii) To include any material information with respect
to the plan of distribution not previously disclosed in
the registration statement or any material change to
such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii)
do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed with or furnished to the Commission by
the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by
reference in the registration statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) Filings incorporating subsequent Exchange Act documents by
reference. The undersigned Registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of
1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) 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.
(h) Filing of registration statement on Form S-8. Insofar as
indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling
persons of the Registrant pursuant to the foregoing provisions, or
otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant
of expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
II-5
<PAGE> 6
SIGNATURES
THE REGISTRANT
Pursuant to the requirements of the Securities Act of 1933, 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 Ellijay, State of Georgia, on this 30th day of April,
1997.
APPALACHIAN BANCSHARES, INC.
By: /s/ Tracy R. Newton
---------------------------------------
Tracy R. Newton
Chief Executive Officer and President
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints Tracy R. Newton and Kent Sanford, and
each of them, his true and lawful attorneys-in-fact and agents, with full power
of substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign any and all amendments to this registration
statement, and to file the same, with all exhibits thereto, and other documents
in connection therewith with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents full power and authority to do and to
perform each and every act and thing requisite and necessary to be done in and
about the premises, as fully and to all intents and purposes as he might or
would do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or their substitutes, may lawfully do or cause to
be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities as of April 30, 1997.
<TABLE>
<CAPTION>
Signature Title
- --------- -----
<S> <C>
/s/ Tracy R. Newton Chief Executive Officer, President,
- ---------------------------- Treasurer and Director
Tracy R. Newton
/s/ Frank E. Jones Chairman of the Board
- ----------------------------
Frank E. Jones
/s/ Kent W. Sanford Executive Vice President, Chief Financial
- ---------------------------- Officer and Chief Operating Officer
Kent W. Sanford
/s/ Alan S. Dover Director
- ----------------------------
Alan S. Dover
</TABLE>
II-6
<PAGE> 7
SIGNATURES
<TABLE>
<CAPTION>
Signature Title
- --------- -----
<S> <C>
/s/ Charles A. Edmondson Director
- ----------------------------
Charles A. Edmondson
/s/ Roger E. Futch Director
- ----------------------------
Roger E. Futch
/s/ Joseph C. Hensley Director
- ----------------------------
Joseph C. Hensley
/s/ J. Ronald Knight Director
- ----------------------------
J. Ronald Knight
/s/ P. Joe Sisson Director
- ----------------------------
P. Joe Sisson
/s/ Kenneth D. Warren Director
- ----------------------------
Kenneth D. Warren
</TABLE>
THE PLAN
Pursuant to the requirements of the Securities Act of 1933, the
Administrative Committee of the Board of Directors of the Company has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the city of Ellijay, State of
Georgia on April 30, 1997.
APPALACHIAN BANCSHARES, INC.
SECTION 401(K) PROFIT SHARING PLAN
By: /s/ Kent W. Sanford
------------------------------------------
Kent W. Sanford
Executive Vice President and Member
of Administrative Committee
II-7
<PAGE> 8
EXHIBIT INDEX
<TABLE>
Exhibit
Number Description
- ------- -----------
<S> <C>
4.1 Appalachian Bancshares, Inc. 1997 Employee Stock Incentive Plan
(filed as Exhibit 10.2 to the Registrant's Form 10-KSB for the
fiscal year ended December 31, 1996 (the "1996 Form 10-KSB" and
incorporated herein by reference)
4.2 Appalachian Bancshares Inc. 1997 Directors' Non-Qualified Stock
Option Plan (filed as Exhibit 10.1 to the 1996 Form 10-KSB and
incorporated herein by reference)
4.3(a) Adoption Agreement for the Appalachian Bancshares, Inc. Section
401(k) Profit Sharing Plan
4.3(b) Georgia Bankers Association Master 401(k) Profit Sharing Plan
5 Opinion of Troutman Sanders LLP
23.1 Consent of Schauer, Taylor, Cox & Edwards, P.C.
23.2 Consent of Troutman Sanders LLP (contained in its opinion filed as
Exhibit 5)
</TABLE>
<PAGE> 1
EXHIBIT 4.3(a)
ADOPTION AGREEMENT
for the
APPALACHIAN BANCSHARES, INC.
SECTION 401(K) PROFIT SHARING PLAN
<PAGE> 2
ADOPTION AGREEMENT
CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE 1 - ADOPTION...................................................................... 1
1.1 Company....................................................................... 1
1.2 Name and Effective Date....................................................... 1
1.3 Company Address and Telephone Number.......................................... 1
1.4 Employer Identification Number................................................ 1
1.5 Plan Number................................................................... 1
1.6 Company Tax Year.............................................................. 1
1.7 Controlled Group Information.................................................. 2
1.8 Participating Companies....................................................... 2
1.9 Administrative Committee...................................................... 2
1.10 Name and Address of Master Plan Sponsor ...................................... 2
ARTICLE 2 - DEFINITIONS................................................................... 3
2.1 Valuation Date................................................................ 3
2.2 Years of Vesting Service...................................................... 3
ARTICLE 3 - ELIGIBILITY .................................................................. 4
3.1 Eligibility Conditions ....................................................... 4
(a) Minimum Age and/or Service................................................ 4
(b) Employment Date........................................................... 4
ARTICLE 4 - CONTRIBUTIONS................................................................. 4
4.1 Section 401(k) Profit Sharing Plan............................................ 4
4.2 Before Tax Contributions...................................................... 5
4.3 After Tax Contributions....................................................... 5
4.4 Special Bonus Election........................................................ 5
4.5 Matching Contributions........................................................ 5
4.6 Annualization of Matching Contributions....................................... 6
4.7 Profit Sharing Contributions.................................................. 6
4.8 Application of Forfeitures.................................................... 7
ARTICLE 5 - ROLLOVERS AND TRANSFERS; VOLUNTARY ACCOUNTS................................... 7
ARTICLE 6 - PARTICIPANTS' ACCOUNTS, CREDITING AND ALLOCATIONS............................. 8
6.1 Active Participants........................................................... 8
6.2 Allocation Formula for Profit Sharing Contributions and Excess Forfeitures.... 8
(a) Non-Integrated............................................................ 8
(b) Integrated................................................................ 8
ARTICLE 7 - CONTRIBUTION AND SECTION 415 LIMITATIONS...................................... 9
7.1 Net Profits................................................................... 9
7.2 Limitations on Allocations.................................................... 9
(a) Participation in Defined Contribution Plan................................ 9
</TABLE>
ii
<PAGE> 3
<TABLE>
<S> <C> <C>
(b) Participation in Defined Benefit Plan..................................... 9
(c) Failsafe Reduction........................................................ 10
ARTICLE 8 - INVESTMENT OF ACCOUNTS........................................................ 10
8.1 Direction of Investments...................................................... 10
8.2 Investment in Company Stock................................................... 10
(a) Adopting Company Election................................................. 10
(b) Participant Election...................................................... 11
ARTICLE 9 - VESTING....................................................................... 11
9.1 Vesting Schedule.............................................................. 11
(a) Cliff Vesting............................................................. 11
(b) Graded Vesting............................................................ 11
(c) Immediate Vesting......................................................... 11
(d) Not Applicable............................................................ 11
ARTICLE 10 - PAYMENT OF BENEFITS WITHOUT LIFE ANNUITY PROVISIONS.......................... 12
10.1 Election of No Life Annuity Provisions....................................... 12
10.2 Optional Form of Benefit..................................................... 12
10.3 Hardship Withdrawals......................................................... 12
10.4 After Tax and Voluntary Account Withdrawals.................................. 12
10.5 Loans........................................................................ 12
ARTICLE 11 - PAYMENT OF BENEFITS WITH LIFE ANNUITY PROVISIONS............................. 13
11.1 Normal Form with Life Annuity Provisions..................................... 13
11.2 Hardship Withdrawals......................................................... 13
11.3 After Tax and Voluntary Account Withdrawals.................................. 13
11.4 Loans........................................................................ 13
ARTICLE 12 - ADMINISTRATION............................................................... 14
ARTICLE 13 - ALLOCATION OF AUTHORITY AND RESPONSIBILITIES................................. 14
ARTICLE 14 - AMENDMENT, TERMINATION AND ADOPTION.......................................... 14
14.1 Amendments................................................................... 14
ARTICLE 15 - TOP-HEAVY PROVISIONS......................................................... 15
15.1 Top-Heavy Vesting............................................................ 15
(a) Cliff Vesting............................................................ 15
(b) Graded Vesting........................................................... 15
15.2 Continuation of Top-Heavy Vesting............................................ 15
15.3 Minimum Contributions........................................................ 15
15.4 Present Value................................................................ 15
ARTICLE 16 - MISCELLANEOUS................................................................ 16
16.1 Advice of Counsel............................................................ 16
16.2 Prior Adoption Agreements.................................................... 16
16.3 Notice From Sponsor.......................................................... 16
16.4 Qualification of Plan........................................................ 16
SIGNATURES................................................................................ 16
ADDENDUM 1
</TABLE>
iii
<PAGE> 4
ADOPTION AGREEMENT
APPALACHIAN BANCSHARES, INC.
SECTION 401(K) PROFIT SHARING PLAN
-----------------------------
The undersigned organization hereby adopts a Section 401(k) Profit Sharing
Plan pursuant to the Georgia Bankers Association Master Section 401(k) Profit
Sharing Plan (the "Master Plan"), upon the terms and conditions set forth in
this Adoption Agreement and the terms and conditions of the Master Plan and the
Master Trust Agreement. Words and phrases used in this Adoption Agreement
shall have the same meanings provided in Article II of the Master Plan.
This Adoption Agreement may be used only in conjunction with the Master
Plan (BPD 01). Failure to properly complete the Adoption Agreement may result
in disqualification of the Plan.
In accordance with the provisions of the Master Plan, the Company
furnishes to the Master Plan Sponsor the following information and elections
concerning its Plan:
ARTICLE 1 - ADOPTION
1.1 Company. Company shall mean Appalachian Bancshares, Inc., which shall
be the Adopting Company and sponsor of the Plan. The Company's principal trade
or business is bank holding company.
1.2 Name and Effective Date. The Company hereby adopts the Appalachian
Bancshares, Inc. Section 401(k) Profit Sharing Plan, which shall be effective
as of April 22, 1997. The Plan is [ELECT ONE]:
( ) A new Plan.
( X ) An amendment and restatement of the Prior Plan, the Gilmer County
Bank Section 401(k) Profit Sharing Plan, which was originally
adopted effective as of January 1, 1995.
1.3 Company Address and Telephone Number.
Appalachian Bancshares, Inc.
315 Industrial Blvd., P.O. Box G
Ellijay, GA 30540
(706) 276-8000
1.4 Employer Identification Number. The Company's employer identification
number is 58-2242407.
1.5 Plan Number. The Plan Number assigned to the Plan is 001 [INSERT
3-DIGIT NUMBER].
1.6 Company Tax Year. The Company's fiscal tax year ends 12/31.
1
<PAGE> 5
1.7 Controlled Group Information. Is the Company a member of a controlled
group or affiliated group of corporations?
(X) Yes ( ) No
[IF THE COMPANY IS A MEMBER OF A CONTROLLED OR AFFILIATED GROUP, LIST BELOW ALL
THE MEMBERS OF THE CONTROLLED OR AFFILIATED GROUP AND THEIR RELATIONSHIP.]
Appalachian Bancshares, Inc. owns 100% of Gilmer County Bank, the sole
member of the controlled group.
1.8 Participating Companies. List below the controlled and/or affiliated
group members, if any, participating in the Plan. Enter "Not Applicable" if no
other companies participate.
Gilmer County Bank
1.9 Administrative Committee. List below the members of the
Administrative Committee by name or title.
<TABLE>
<S> <C>
Tracy Newton President/CEO
Kent Sanford Executive Vice President/CFO
Joe Hensley Director
</TABLE>
1.10 Name and Address of Master Plan Sponsor.
Georgia Bankers Association
50 Hurt Plaza, Suite 1050
Atlanta, Georgia 30303
(404) 522-1501
2
<PAGE> 6
ARTICLE 2 - DEFINITIONS
2.1 Valuation Date. Valuation Date shall mean [ELECT ONE]:
( ) (a) the last day of each Plan Year.
( X ) (b) the last day of the sixth calendar month and the last day of
the twelfth calendar month of each Plan Year, said dates
being 6/30 and 12/31.
---- -----
( ) (c) the last day of every third calendar month during the Plan
Year, said dates being ________________, _________________,
_________________ and ________________.
( ) (d) every day on which the Trustee operates, and is open to the
public for, its business.
2.2 Years of Vesting Service.
Shall Years of Vesting Service as defined in Section 2.112 of the
Master Plan include periods during which the Company did not maintain the Plan,
a predecessor plan or a plan of a predecessor employer?
( X ) Yes ( ) No
3
<PAGE> 7
ARTICLE 3 - ELIGIBILITY
3.1 Eligibility Conditions. Each Covered Employee shall become eligible
to participate in the Plan upon the later of the Effective Date or satisfaction
of the condition(s) elected below [ELECT (a) OR (b) BELOW]:
( ) (a) Minimum Age and/or Service [ELECT ONE OR BOTH]:
( X )(1) Attainment of age 21 (not more than 21).
( X )(2) Completion of [ELECT ONE]:
( X ) (A) one Year of Service.
( ) (B) two Years of Service. [YOU MUST ELECT
Section 9.1(a)(3) IF YOU ELECT THIS OPTION, AND
YOU CANNOT ELECT THIS OPTION IF YOU WISH TO
ELECT Section 4.1(b).]
( ) (C) ____ Hours of Service (NOT MORE THAN
1,000). [THIS ELECTION SHALL NOT BE CONSTRUED
TO MEAN MORE THAN 1 YEAR OF ELIGIBILITY
SERVICE.]
( ) (D) ____ months of Continuous Service from the
date the Employee first performs an Hour of
Service (NOT MORE THAN 12) or if earlier,
1,000 Hours of Service. [THIS ELECTION SHALL
NOT BE CONSTRUED TO MEAN MORE THAN 1 YEAR OF
ELIGIBILITY SERVICE.]
( ) (b) Employment Date: The day the Employee first performs an
Hour of Service for the Company.
ARTICLE 4 - CONTRIBUTIONS
4.1 Section 401(k) Profit Sharing Plan [ELECT (a) OR (b)]:
( ) (a) The Company hereby elects to adopt a profit sharing plan
which does not have a Section 401(k), cash-or-deferred
feature and does not allow After Tax Contributions but
which does permit Profit Sharing Contributions to the Plan
pursuant to the Master Plan and Section 4.7.
[IF (a) IS ELECTED, Section Section 4.2 - 4.6 WILL NOT APPLY; GO
DIRECTLY TO Section 4.7(b)]
( X ) (b) The Company hereby elects to adopt a profit sharing plan
that does include a Section 401(k), cash-or-deferred
feature and may, but is not required to, elect to permit
After Tax Contributions pursuant to Section 4.3 and/or
Profit Sharing Contributions pursuant to Section 4.7.
5
<PAGE> 8
4.2 Before Tax Contributions. A Participant may elect to reduce his
Compensation for any period by a minimum of 1 percent and a maximum of [ELECT
(a) OR (b)]:
( X ) (a) 16 percent (NOT TO EXCEED 16).
( ) (b) A percentage (NOT TO EXCEED 16) selected by the
Administrative Committee of the Adopting Company each Plan
Year.
4.3 After Tax Contributions [If (a) IS "YES", ALSO COMPLETE (b).
(a) Shall Participants be permitted to make After Tax Contributions
to the Plan pursuant to Section 4.2(b) of the Master Plan?
( ) Yes ( X ) No
(b) A Participant may elect to reduce his Compensation for any
period by a minimum of 1 percent and a maximum of [ELECT (1)
or (2). The total maximum percentages of before tax and after
tax contributions shall not exceed 16 percent.]:
( ) (1) ___ percent [NOT TO EXCEED 10].
( ) (2) A percentage [NOT TO EXCEED 10] selected by the
Administrative Committee of the Adopting Committee each Plan
Year.
4.4 Special Bonus Election. Shall Participants be permitted to reduce
part or all of any Special Bonuses, as designated by the Company, and have the
reduced amounts constitute Before Tax Contributions pursuant to Section
4.2(d)(6) of the Master Plan?
( X ) Yes ( ) No
4.5 Matching Contributions [ELECT (a) OR (b)]:
( ) (a) The Company shall not make Matching Contributions under the
Plan.
( X ) (b) The Company shall make Matching Contributions each Plan
Year. The amount of such Matching Contributions shall
be determined as follows [SELECT ONE OPTION IN (1), (2) AND
(3) BELOW]:
(1) The Company's Matching Contributions for each Plan
Year will not apply to an amount that exceeds the
following percentage of the Compensation of each
Participant who makes Before Tax Contributions (ELECT
ONE):
<TABLE>
<S> <C> <C>
( ) (A) 1%
( ) (B) 2%
( ) (C) 3%
( ) (D) 4%
( ) (E) 5%
(X) (F) 6%
( ) (G) A percentage or percentages
selected by the Board of Directors
for each Plan Year.
[IF YOU ELECT (G), YOU MAY NOT ELECT (F) IN
Section 4.5(b)(2).]
</TABLE>
5
<PAGE> 9
(2) The Company shall contribute for each Plan Year the
following amount for each dollar of a Participant's
Before Tax Contributions that do not exceed the
percentage of such Participant's Compensation elected
in section (1) above (ELECT ONE):
<TABLE>
<S> <C> <C>
( ) (A) $ .10
( ) (B) $ .25
( ) (C) $ .50
( ) (D) $ .75
( ) (E) $1.00
(X) (F) An amount or amounts (if any)
selected by the Board of Directors
for each Plan Year.
[IF YOU ELECT (F), YOU MAY NOT ELECT (G) IN
Section 4.5(b)(1).]
</TABLE>
(3) Matching Contributions shall be made [ELECT (A) OR
(B)]:
( ) (A) On a payroll-by-payroll basis with respect to
Before Tax Contributions made for each
payroll period; or
(X) (B) On a Plan Year basis with respect to Before
Tax Contributions made for the Plan Year.
4.6 Annualization of Matching Contributions. Shall the terms of Section
4.3(b) of the Master Plan which provide that Matching Contributions be
annualized at the end of each Plan Year so that Participants receive a Matching
Contribution based on the total amount of their Before Tax Contributions during
the Plan Year apply to the Plan? [ELECT (a) OR (b)]:
(X) (a) Yes, Matching Contributions under the Plan shall be
annualized pursuant to Section 4.3(b) of the Master
Plan.
( ) (b) No, Matching Contributions under the Plan shall not be
annualized. Section 4.3(b) of the Master Plan shall
not apply to the Plan.
4.7 Profit Sharing Contributions. The amount of such Profit Sharing
Contribution for each Plan Year shall be determined as follows [ELECT ONE
OPTION BELOW]:
(X) (a) An amount selected by the Board for each Plan Year.
( ) (b) ____% of Net Profits, or such greater amount of Profit
Sharing Contributions as may be approved by the Board.
( ) (c) ____% of the first $_______ of Net Profits, ____% of
the next $______ of Net Profits, and ____% of
remaining Net Profits, or such greater amount of Profit
Sharing Contributions as may be approved by the Board
[COMPLETE DESIRED ITEMS].
( ) (d) ____% of aggregate Compensation of Participants
eligible to receive an allocation of Profit Sharing
Contributions, or such greater amount of Profit
Sharing Contributions as may be approved by the Board.
(If Section 7.1 is elected, such smaller percentage as
Net Profits allow.)
6
<PAGE> 10
4.8 Application of Forfeitures. After Forfeitures have been used as
Supplemental Contributions, Restorative Contributions, or both, as applicable,
Forfeitures shall be allocated as follows [ELECT ONE]:
(X) (a) Forfeitures shall be allocated to eligible
Participants' accounts pursuant to Section 4.10 of
the Master Plan.
( ) (b) Forfeitures shall be used to reduce the Matching
Contributions required by the Participating Companies
for the Plan Year, pursuant to Section 4.3(c) of the
Plan.
( ) (c) Forfeitures shall be used to reduce the Profit
Sharing Contribution required by the Participating
Companies for the Plan Year, pursuant to Section 4.5
(b) of the Plan.
( ) (d) Forfeitures shall be allocated at the discretion of
the Board, as determined each Plan Year and in
accordance with the terms of the Plan.
ARTICLE 5 - ROLLOVERS AND TRANSFERS; VOLUNTARY ACCOUNTS
[RESERVED]
7
<PAGE> 11
ARTICLE 6 - PARTICIPANTS' ACCOUNTS, CREDITING
AND ALLOCATIONS
6.1 Active Participants: The Company's Matching Contributions which are
made on a Plan Year basis as provided in Section 4.3(a) of the Master Plan and
Section 4.5(b)(3) (but not those made on a payroll-by-payroll basis), Profit
Sharing Contributions and any excess Forfeitures shall be allocated among, and
the non-Highly Compensated Employees eligible for Supplemental Contributions
shall be selected from [ELECT ONE]:
( ) (a) All Employees who were Participants during the Plan Year.
( ) (b) Participants who were employed on the last day of the Plan
Year.
( ) (c) Participants who completed ________ Hours of Service (NOT
MORE THAN 1,000) during the Plan Year.
(X) (d) Participants who were employed on the last day of the Plan
Year and who completed 1,000 Hours of Service (NOT MORE
THAN 1,000) during the Plan Year.
6.2 Allocation Formula for Profit Sharing Contributions and Excess
Forfeitures: Each eligible Participant shall have allocated to his Profit
Sharing Account the portion of the Company's Profit Sharing Contributions and
excess Forfeitures as is determined according to the formula below [ELECT (a)
OR (b)]:.
(X) (a) Non-Integrated. In the same proportion that each such
Participant's Compensation for the Plan Year bears to the
total Compensation of all such Participants for such Plan
Year.
( ) (b) Integrated. In such proportion as is determined pursuant
to the formula set forth in Section 6.4(b)(ii) of the
Master Plan (which formula integrates allocations with
Social Security).
8
<PAGE> 12
ARTICLE 7 - CONTRIBUTION AND SECTION 415 LIMITATIONS
7.1 Net Profits [ELECT (a) OR (b)]:
(X) (a) The Company shall not require Net Profits to make Company
Contributions to the Plan.
( ) (b) The Company shall require Net Profits to make Company
Contributions to the Plan.
7.2 Limitations on Allocations. If the Company or any of its Affiliates
maintains or ever maintained another qualified plan (other than a Prior Plan)
in which any Participant in the Plan is (or was) a participant or could
possibly become a participant, this Section must be completed. NOT APPLICABLE
(a) Participation in Defined Contribution Plan. If the Participant
is covered by another qualified Defined Contribution Plan maintained
by the Company or any of its Affiliates other than a master or
prototype plan [ELECT ONE]:
( ) (1) The provisions of Section 7.7 of the Master Plan shall
apply as if the other plan were a master or prototype plan.
( ) (2) The Annual Additions accrued by the Participant under the
Plan for any Limitation Year shall be reduced so that
the maximum permissible amount shall not be exceeded for
such Limitation Year. After Tax Contributions, then Before
Tax Contributions, and then other Company Contributions to
the extent necessary, shall be reduced. In the event
reduction of the accrual of the Participant's Annual
Additions under the Plan is not sufficient to reduce the
aggregate Annual Additions for such Limitation Year to the
maximum permissible amount, the Annual Additions under such
other plan(s) sponsored by the Company or any of its
Affiliates shall be reduced for the Limitation Year
according to the terms of such plan(s) so that the maximum
permissible amount is not exceeded.
( ) (3) The Annual Additions accrued by the Participant under such
other Defined Contribution Plan(s) sponsored by the Company
or any of its Affiliates for a Limitation Year shall be
reduced so that the maximum permissible amount shall not
be exceeded for the Limitation Year. If further reduction
is necessary, the Annual Additions of the Participant under
the Plan shall be reduced to the extent required in order
that the sum of the Annual Additions under such plan(s) (as
adjusted in the preceding sentence) and the Plan shall not
exceed the maximum permissible amount. After Tax
Contributions, then Before Tax Contributions, and then other
Company Contributions to the extent necessary, shall be
reduced.
(b) Participation in Defined Benefit Plan. If the Participant is or
has ever been a participant in a Defined Benefit Plan(s) maintained by
the Company or any of its Affiliates, or an individual medical account
(as defined in Code Section 415(1)(2)), and the sum of the Defined
Benefit Fraction and the Defined Contribution Fraction (as defined in
Section 7.7(e) of the Master Plan) exceeds 1.0, the annual benefit
accrued and/or Annual Additions made on the Participant's behalf for
such Limitation Year shall be reduced as follows [ELECT ONE]:
( ) The projected annual benefit which is credited to the
Participant for the Limitation Year in which the sum of the
Defined Benefit Plan Fraction and the Defined Contribution
Plan Fraction exceeds 1.0 shall be reduced according to the
terms of such plan(s) to the extent necessary to
9
<PAGE> 13
reduce the sum of the fractions for the Limitation Year
to 1.0. In the event reductions in the accrued benefit under
such Defined Benefit Plan(s) are insufficient to reduce the sum
of the Defined Benefit Plan Fraction (as adjusted in the
preceding sentence) and the Defined Contribution Plan Fraction
to 1.0, the Annual Additions for the Participant for the
Limitation Year under any other Defined Contribution Plan(s)
sponsored by the Company or any of its Affiliates shall be
reduced according to the terms of such plan, and then, if
necessary, the Annual Addition for the Participant under the
Plan shall be reduced, such that the sum of both fractions as
adjusted does not exceed 1.0. After Tax Contributions, then
Before Tax Contributions, and then other Company Contributions
to the extent necessary, shall be reduced.
( ) The Annual Additions under the Plan, which for the Participant
during any Limitation Year in which the sum of the Defined
Contribution Plan Fraction and the Defined Benefit Plan
Fraction exceeds 1.0, shall be reduced to the extent necessary
so that the sum of such fractions will not exceed 1.0. After
Tax Contributions, then Before Tax Contributions, and then other
Company Contributions to the extent necessary, shall be reduced.
In the event that reduction of the Annual Additions accrued by
the Participant under this Plan for the Limitation Year is
insufficient to reduce the sum of the fractions to 1.0, the
accrued benefits on behalf of the Participant for the limitation
year under the Defined Benefit Plan(s) sponsored by the Company
or any of its Affiliates shall be reduced in an amount
sufficient to reduce the Defined Benefit Plan Fraction such that
the sum of the fractions as adjusted does not exceed 1.0. The
reduction of accrued benefits shall take place according to the
terms of such Defined Benefit Plan(s) maintained by the Company.
(c) Failsafe Reduction: In the event that the option elected under
(a) or (b) calls for a reduction in the Annual Additions made or
annual benefits accrued on a Participant's behalf under the other
plan(s) maintained by the Company or any of its Affiliates, and such
plan(s) call for the reduction of Annual Additions under this Plan in
the event that the maximum permissible amount or the 1.0 fraction is
exceeded, the Annual Addition accrued under this Plan on behalf of the
Participant for the limitation year shall be reduced so that the
maximum permissible amount or the 1.0 fraction, whichever is
applicable, does not exceed 1.0. After Tax Contributions, then Before
Tax Contributions, and then other Company Contributions to the extent
necessary, shall be reduced.
ARTICLE 8 - INVESTMENT OF ACCOUNTS
8.1 Direction of Investments. Shall Participants be permitted to direct
the investment of each of their Accounts pursuant to Section 8.3 of the Master
Plan?
(X) Yes ( ) No
8.2 Investment in Company Stock
(a) Adopting Company Election. Shall the Plan permit investment in
Company Stock? [IF YES, THE COMPANY STOCK TRUST AGREEMENT MUST ALSO BE
ADOPTED.]
(X) Yes ( ) No
10
<PAGE> 14
(b) Participant Election. If (a) above is Yes, shall Participants be
permitted to direct the investment of their permissible Accounts in Company
Stock pursuant to Section 8.3 of the Plans? [FOR COMPANY STOCK THAT IS NOT
PUBLICITY TRADED, PARTICIPANTS CAN ONLY BE PERMITTED TO DIRECT THE INVESTMENT
OF THEIR MATCHING AND PROFIT SHARING ACCOUNTS IN COMPANY STOCK.]
(X) Yes ( ) No
ARTICLE 9 - VESTING
9.1 Vesting Schedule. A Participant's vested percentage of his Matching
and Profit Sharing Accounts shall be determined as follows [ELECT ONE AND
COMPLETE]:
[IF Section 3.1(a)(2)(B) IS ELECTED, Section 9.1(a)(3) MUST BE
ELECTED.]
( ) (a) Cliff Vesting:
100% vesting after (ELECT ONE):
( ) (A) 1 Year of Vesting Service
( ) (B) 2 Years of Vesting Service
( ) (C) 3 Years of Vesting Service
( ) (D) 4 Years of Vesting Service
( ) (E) 5 Years of Vesting Service
(X) (b) Graded Vesting:
<TABLE>
<CAPTION>
Vested Percentage
of Matching or May not be
Years of Vesting Service Profit Sharing Account less than:
------------------------ ---------------------- ----------
<S> <C> <C>
Less than 1 0 % 0%
-------
1, but less than 2 0 % 0%
-------
2, but less than 3 0 % 0%
-------
3, but less than 4 20 % 20%
-------
4, but less than 5 40 % 40%
-------
5, but less than 6 60 % 60%
-------
6, but less than 7 80 % 80%
-------
7 or more 100 % 100%
-------
</TABLE>
( ) (c) Immediate Vesting: Each Participant at all times shall be
100% vested in his Matching and Profit Sharing Accounts.
( ) (d) Not Applicable. Neither Profit Sharing Contributions nor
Matching Contributions are permitted under the Plan.
11
<PAGE> 15
ARTICLE 10 - PAYMENT OF BENEFITS WITHOUT LIFE ANNUITY PROVISIONS
10.1 Election of No Life Annuity Provisions. Shall the form(s) of benefit
distribution under the Plan be limited to those that do not include any life
annuity provisions?
( ) Yes (X) No
[IF "YES" IS ELECTED, COMPLETE THE REST OF ARTICLE 10 AND THEN GO DIRECTLY
TO ARTICLE 12 - ARTICLE 11 WILL NOT APPLY, UNLESS THERE ARE TRANSFER ACCOUNTS
FOR WHICH A LIFE ANNUITY IS A CODE Section 411(d)(6) PROTECTED FORM OF
DISTRIBUTION.]
[IF "NO" IS ELECTED DO NOT COMPLETE THE REST OF ARTICLE 10; ARTICLE 11
INSTEAD WILL APPLY.]
( ) Yes ( ) No
10.2 Optional Form of Benefit. Shall Participants be permitted to elect
the optional form of installment payments as described in Section 10.3(b) of
the Master Plan?
( ) Yes ( ) No
[IF "NO" IS ELECTED, ALL DISTRIBUTIONS WILL BE MADE IN A SINGLE SUM
PAYMENT AS PROVIDED IN Section 10.3(a) OF THE MASTER PLAN, AND Section 10.3(b)
THEREOF WILL NOT APPLY.]
10.3 Hardship Withdrawals. Shall a Participant be entitled to make
hardship withdrawals from his vested Account pursuant to Section 10.6 of the
Master Plan?
( ) Yes ( ) No
10.4 After Tax and Voluntary Account Withdrawals: Shall a Participant be
permitted to make withdrawals from his After Tax and Voluntary Accounts
pursuant to Section 10.7 of the Master Plan?
( ) Yes ( ) No
10.5 Loans. Shall the Company permit Participants to receive loans from
their Account pursuant to the terms of Section 10.9 of the Master Plan?
( ) Yes ( ) No
12
<PAGE> 16
ARTICLE 11 - PAYMENT OF BENEFITS WITH LIFE ANNUITY PROVISIONS
11.1 Normal Form with Life Annuity Provisions. The normal form of payment
shall be a Life Annuity for unmarried Participants and a Joint and 50% Survivor
Annuity for married Participants, with death benefits provided in the form of a
Survivor Annuity, with respect to:
(X) (a) All Plan benefits.
( ) (b) Only Transfer Accounts for which such life and survivor
annuities are Code Section 411(d)(6) protected benefits.
These Transfer Accounts are ______________________________
__________________________________________________________.
( ) (c) No benefits under the Plan [ELECT ONLY IF THE LIFE ANNUITY
FORM IS NOT DESIRED AND THERE ARE NO TRANSFER ACCOUNTS
DESCRIBED IN SUBSECTION (b) HEREOF]
[IF (a) IS ELECTED, ARTICLE XI OF THE MASTER PLAN WILL APPLY, AND ARTICLE
X WILL NOT BE APPLICABLE. IF (b) ABOVE IS ELECTED, ARTICLE X WILL APPLY TO ALL
BENEFITS OTHER THAN TRANSFER ACCOUNTS SUBJECT TO ANNUITY PROVISIONS TO WHICH
ARTICLE XI SHALL APPLY. IF (c) IS ELECTED ABOVE, ARTICLE XI OF THE MASTER PLAN
WILL NOT BE APPLICABLE.]
11.2 Hardship Withdrawals. Shall a Participant be entitled to make
hardship withdrawals from his vested Account pursuant to Section 11.9 of the
Master Plan?
(X) Yes ( ) No
11.3 After Tax and Voluntary Account Withdrawals. Shall a Participant be
permitted to make withdrawals from his After Tax and Voluntary Accounts
pursuant to Section 11.10 of the Master Plan?
( ) Yes (X) No
11.4 Loans. Shall the Company permit Participants to receive loans from
their Account pursuant to the terms of Section 11.12 of the Master Plan?
( ) Yes (X) No
13
<PAGE> 17
ARTICLE 12 - ADMINISTRATION
[RESERVED]
ARTICLE 13 - ALLOCATION OF AUTHORITY AND RESPONSIBILITIES
[RESERVED]
ARTICLE 14 - AMENDMENT, TERMINATION AND ADOPTION
14.1 Amendments. The Company by executing this Adoption Agreement agrees:
(a) To furnish such information with respect to persons eligible
to participate under the Plan and other matters as may be
prescribed by the Trustee for convenient administration of the
Plan.
(b) To accept such amendments to the Plan as may be made from time
to time by the Master Plan Sponsor in order to comply with the
Code or regulations or for other reasons, subject always to the
right of the undersigned to terminate the Plan as provided
therein.
14
<PAGE> 18
ARTICLE 15 - TOP-HEAVY PROVISIONS
15.1 Top-Heavy Vesting: For Plan Years in which the Plan is a Top-Heavy
Plan, the nonforfeitable interest of each Participant in his Matching and
Profit Sharing Accounts shall be determined according to the following schedule
[ELECT AND COMPLETE ONE]:
( ) (a) Cliff Vesting.
100% vesting after [ELECT ONE]:
( ) (1) 1 Year of Vesting Service
( ) (2) 2 Years of Vesting Service
( ) (3) 3 Years of Vesting Service
(X) (b) Graded Vesting.
<TABLE>
<CAPTION>
Vested
Percentage
of Matching
or Profit
Sharing May not
Years of Vesting Service Account be less than:
------------------------ ----------- -------------
<S> <C> <C>
Less than 1 0 % 0%
----------
1, but less than 2 0 % 0%
----------
2, but less than 3 20 % 20%
----------
3, but less than 4 40 % 40%
----------
4, but less than 5 60 % 60%
----------
5, but less than 6 80 % 80%
----------
6 or more 100 % 100%
----------
</TABLE>
15.2 Continuation of Top-Heavy Vesting. If the Plan becomes a Top-Heavy
Plan for a Plan Year (so that the vesting schedule above is applicable for that
Plan Year), and later ceases to be a Top Heavy Plan, shall the vesting schedule
set forth above continue to apply in later Plan Years?
(X) Yes, the Top-Heavy vesting schedule shall continue to apply.
( ) No, the Top-Heavy vesting schedule shall not continue to apply,
and Participants will vest in their Accounts in later Plan
Years in accordance with the schedule selected in Section 9.1.
[IF THIS OPTION IS CHOSEN, THE RETURN TO THE PREVIOUS VESTING
SCHEDULE IS A VESTING SCHEDULE AMENDMENT SUBJECT TO THE TERMS OF
Section 15.5 OF THE Master PLAN.]
15.3 Minimum Contributions: The minimum Company Contribution on behalf of
a Participant, required under Section 15.4 of the Master Plan, for a Plan Year
in which the Plan is Top Heavy, shall be provided [ELECT ONE]:
(X) By the Plan.
( ) By the ________________________________ (INSERT NAME OF PLAN(S)
SPONSORED BY THE COMPANY WHICH WILL PROVIDE THE MINIMUM
CONTRIBUTION).
15.4 Present Value. Present value of the cumulative accrued benefit shall
be determined based on the following:
15
<PAGE> 19
Interest rate: 5 %
------
Mortality table: UP-1984 Unisex
-----------------
ARTICLE 16 - MISCELLANEOUS
16.1 Advice of Counsel: The Company affirms that it has conferred and
acted upon the advice of its own counsel in adopting the Plan.
16.2 Prior Adoption Agreements. This Adoption Agreement supersedes any
prior Adoption Agreement executed in connection with the Plan.
16.3 Notice From Sponsor. If the Master Plan Sponsor amends, discontinues
or abandons the Master Plan, the Master Plan Sponsor will so notify the
Company.
16.4 Qualification of Plan. The Company may not rely on any opinion
letter issued by the National Office of the Internal Revenue Service on the
Master Plan as evidence that the Plan is qualified under Section 401 of the
Code. In order to obtain reliance with respect to the Plan's qualification,
the Company must apply to the appropriate key district office of the Internal
Revenue Service for a determination letter.
16.5 Fiduciary Responsibilities. The Company acknowledges that the
Administrative Committee appointed by the Company is the "plan administrator"
within the meaning of ERISA. As such, the Administrative Committee is a
fiduciary of the Plan and assumes the responsibilities outlined in the Plan.
The Company also acknowledges that the Master Plan Sponsor provides
administrative support services for the Plan but is not the plan administrator
or a fiduciary.
IN WITNESS WHEREOF, the Company hereby adopts the Plan as set forth
herein, and the Company has caused its duly authorized officers to execute this
Adoption Agreement, as of the 22nd day of April, 1997.
Appalachian Bancshares, Inc.
------------------------------------------
Company
By: /s/ Tracy R. Newton
---------------------------------------
Title: PRESIDENT
------------------------------------
Attest: /s/ Kent Sanford
-----------------------------------
Title: EXECUTIVE VICE PRESIDENT
------------------------------------
[A WRITTEN ACCEPTANCE BY THE MASTER PLAN SPONSOR MUST BE OBTAINED AND ATTACHED
HERETO FOR THIS ADOPTION AGREEMENT TO BE EFFECTIVE.]
16
<PAGE> 20
ACCEPTANCE BY MASTER PLAN SPONSOR
The foregoing Adoption Agreement is hereby accepted effective as of the
Effective Date provided above.
GEORGIA BANKERS ASSOCIATION
By: /s/ John J. Brannen
-------------------------------------
John J. Brannen
Date: April 24, 1997 Title: President
------------------------ ----------------------------------
17
<PAGE> 1
EXHIBIT 4.3(b)
GEORGIA BANKERS ASSOCIATION
MASTER SECTION 401(K) PROFIT SHARING PLAN
AMENDED AND RESTATED
EFFECTIVE GENERALLY APRIL 1, 1996
<PAGE> 2
GEORGIA BANKERS ASSOCIATION
MASTER SECTION 401(K) PROFIT SHARING PLAN
On this 21st day of March, 1996, Georgia Bankers Association ("Master
Plan Sponsor"), with its principal office in Atlanta, Georgia, hereby amends
and restates the Georgia Bankers Association Master Section 401(k) Profit
Sharing Plan and Trust (the "Master Plan") effective with respect to Adoption
Agreements entered into on or after April 1, 1996.
STATEMENT OF PURPOSE
The Master Plan was the result of the amendment and restatement of the
Georgia Bankers Association Master Profit Sharing Plan ("Master Profit Sharing
Plan"), which was initially adopted effective as of January 1, 1972, and the
Georgia Bankers Association Master Section 401(k) Profit Sharing Plan and Trust
("Master 401(k) Plan"), which was initially adopted effective as of January 1,
1987. The Master Plan, as set forth in this document, is intended and should
be construed as a restatement and a continuation of the Master Profit Sharing
Plan and the Master 401(k) Savings Plan. The Master Plan was last amended and
restated effective January 1, 1989, in order to bring the Master Plan into
compliance with all the Tax Reform Act of 1986 and subsequent laws and
regulations issued prior to that date. This most recent restatement in
intended to reflect certain plan design changes. It is intended that this
restatement shall become effective with respect to each Adoption Agreement
modified or entered into on or after April 1, 1996, such that any Plan
established under the Master Plan prior to this restatement may continue to
rely on its current determination letter unless or until the Adoption Agreement
establishing such Plan is modified.
The Master Plan Sponsor has established the Master Plan in order to
assist member banks and other related companies in adopting profit sharing
plans with cash-or-deferred features (if elected) which qualify under Sections
401(a) and 401(k) of the Internal Revenue code of 1986, as amended. Member
banks and other related companies may adopt the Master Plan as a new plan or as
a restatement of a Prior Plan.
The Master Plan Sponsor intends that the Master Plan be a profit
sharing plan qualified under Section Section 401(a) and 401(k) of the Internal
Revenue Code of 1986, as amended.
STATEMENT OF AGREEMENT
To amend and restate the Master Plan with the purposes and goals as
hereinabove described, the Master Plan Sponsor hereby sets forth the terms and
provisions of the Master Plan as follows:
<PAGE> 3
GEORGIA BANKERS ASSOCIATION
MASTER SECTION 401(K) PROFIT SHARING PLAN AND TRUST
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
ARTICLE I ADOPTION OF PLAN. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Procedure for Adoption of Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
(a) Procedure. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
(b) Effect of Adoption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Contents of Adoption Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.1 Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.2 ACP or Average Contribution Percentage . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.3 ACP Tests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.4 Active Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.5 Administrative Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2.6 Adopting Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.7 Adoption Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.8 ADP or Actual Deferral Percentage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.9 ADP Tests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.10 Affiliate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.11 After Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.12 After Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.13 After Tax Deferral Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.14 Annual Addition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.15 Before Tax Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.16 Before Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.17 Before Tax Deferral Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.18 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.19 Benefit Commencement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.20 Board or Board of Directors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.21 Break in Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.22 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.23 Company Contribution Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.24 Company Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.25 Company Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.26 Company Stock Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.27 Company Stock Trust or Company Stock Trust Agreement . . . . . . . . . . . . . . . . . . . . . . 5
2.28 Company Stock Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.29 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(a) Benefit Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(b) Section 415 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(c) Key Employee Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
(d) Testing Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.30 Continuous Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.31 Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.32 Covered Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.33 Deferral Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
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2.34 Defined Benefit Minimum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.35 Defined Benefit Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.36 Defined Benefit Fraction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.37 Defined Contribution Minimum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.38 Defined Contribution Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.39 Defined Contribution Fraction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.40 Determination Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.41 Disability or Disabled . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.42 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.43 Elective Deferrals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.44 Eligible Retirement Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.45 Eligible Rollover Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.46 Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2.47 Entry Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.48 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.49 Excess Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.50 Forfeiture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
2.51 Highly Compensated Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(a) General Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(b) Excluded Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(c) Family Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(d) Former Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(e) Nonresident Aliens . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(f) Compliance with Code Section 414(q) . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
2.52 Hour of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(a) General Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(b) Equivalencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
(c) DOL Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
(d) Computation Period . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.53 Integration Level . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.54 Integration Tax Rate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.55 Investment Fund or Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.56 Joinder Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.57 Joint Annuitant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.58 Joint and 50% or 100% Survivor Annuity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.59 Key Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.60 Leave of Absence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
2.61 Life Annuity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.62 Limitation Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.63 Master Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.64 Master Trust or Master Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.65 Master Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.66 Master Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.67 Matching Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.68 Matching Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.69 Maternity or Paternity Leave . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.70 Maximum Deferral Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.71 Named Fiduciary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.72 Net Profit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
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2.73 Non-Key Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.74 Normal Retirement Age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
2.75 Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.76 Participating Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.77 Permissive Aggregation Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.78 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.79 Plan Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.80 Plan Year . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.81 Portfolio . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.82 Prior Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.83 Profit Sharing Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.84 Profit Sharing Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.85 Publicly Traded . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.86 Qualified Employer Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.87 Qualified Retirement Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
2.88 Qualified Separation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.89 Qualified Spousal Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.90 Required Aggregation Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.91 Restoration Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.92 Rollover Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.93 Rollover Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.94 Special Bonus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.95 Special Bonus Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.96 Spouse or Surviving Spouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.97 Supplemental Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.98 Supplemental Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.99 Survivor Annuity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.100 Taxable Wage Base . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.101 Top-Heavy Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.102 Top-Heavy Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.103 Transfer Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.104 Transfer Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.105 Trust or Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.106 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.107 Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.108 Valuation Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.109 Voluntary Account . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.110 Voluntary Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.111 Year of Eligibility Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
2.112 Year of Vesting Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE III ELIGIBILITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.1 Initial Eligibility Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(a) General Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(b) Participation Upon Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(c) Grandfathered Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.2 Treatment of Interruptions of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(a) Leave of Absence . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(b) Reemployment Before Break in Service . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
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(c) Reemployment After Break in Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(d) Reparticipation Upon Reemployment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
3.3 Change in Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(a) Loss of Covered Employee Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
(b) Change to Covered Employee Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(c) Change by Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.4 Notification of Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.5 Provisions of Plan Binding on Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.6 Companies in Controlled Groups . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
ARTICLE IV CONTRIBUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
4.2 Before Tax and After Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(a) Before Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(b) After Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(c) Contributions Which Exceed Maximum Deferral Amount . . . . . . . . . . . . . . . . . . . . 19
(d) Deferral Elections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
4.3 Matching Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(b) Additional Matching Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(c) Reduction of Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.4 Supplemental Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.5 Profit Sharing Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(b) Reduction of Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.6 Form of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(b) Company Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
4.7 Timing of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(a) Before Tax and After Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(b) Matching, Supplemental and Profit Sharing Contributions . . . . . . . . . . . . . . . . . . 23
4.8 Contingent Nature of Company Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
4.9 Restoration Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(a) Restoration Upon Buy-Back . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(b) Restoration of Other Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
(c) Restoration Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
(d) Notice of Buy-Back Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
4.10 Allocation of Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
ARTICLE V ROLLOVERS AND TRANSFERS BETWEEN PLANS; VOLUNTARY ACCOUNTS . . . . . . . . . . . . . . . . . . . . 25
5.1 Rollover Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
(a) Request by Covered Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
(b) Acceptance of Rollover . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.2 Transfer Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
(a) Direct Transfers Permitted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
(b) Mergers and Spin-offs Permitted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
(c) Establishment of Transfer Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
5.3 Spin-offs to Other Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
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5.4 Voluntary Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
(a) Contributions Not Permitted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
(b) Conditions on Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
ARTICLE VI PARTICIPANTS' ACCOUNTS; CREDITING AND ALLOCATIONS . . . . . . . . . . . . . . . . . . . . . . . 27
6.1 Establishment of Participants' Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
6.2 Allocation and Crediting of Before Tax, After Tax, Matching, Voluntary, Rollover
and Transfer Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
6.3 Allocation and Crediting of Supplemental Contributions . . . . . . . . . . . . . . . . . . . . . 27
(a) Participants Receiving Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
(b) Formula for Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
(c) Per Capita Supplemental Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
(d) Proportional Supplemental Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . 28
(e) Supplemental Matching Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
(f) Section 415 Supplemental Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.4 Allocation and Crediting of Profit Sharing Contributions and Excess Forfeitures . . . . . . . . 28
(a) Participants Receiving Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
(b) Formula for Allocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
6.5 Crediting of Restoration Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.6 Allocation and Crediting of Investment Earnings and Losses . . . . . . . . . . . . . . . . . . . 29
(a) Determination of Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
(b) Allocation of Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
(c) Increase for Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
(d) Reduction for Distributions and Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . 30
6.7 Notice to Participants of Account Balances . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.8 Good Faith Valuation Binding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.9 Errors and Omissions in Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.10 Participants Eligible for Allocations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.11 Allocations and Crediting of Investment Earnings and Losses in Company Stock
Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
(a) Determination of Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
(b) Allocation of Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
(c) Increase for Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
(d) Reduction for Distributions and Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . 31
ARTICLE V CONTRIBUTION AND SECTION 415 LIMITATIONS AND NONDISCRIMINATION REQUIREMENTS . . . . . . . . . . . 32
7.1 Profit and Deductibility Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
7.2 Maximum Limitation on Elective Deferrals by Participating Companies . . . . . . . . . . . . . . 32
(a) Maximum Elective Deferrals Under Participating Company Plans . . . . . . . . . . . . . . . 32
(b) Return of Excess Before Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . 32
(c) Return of Excess Elective Deferrals Provided by Other Participating Company
Arrangements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
(d) Discretionary Return of Elective Deferrals . . . . . . . . . . . . . . . . . . . . . . . . 32
(e) Return of Excess Annual Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
7.3 Nondiscrimination Requirements for Before Tax Contributions . . . . . . . . . . . . . . . . . . 33
(a) ADP Test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
(b) Multiple Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
(c) Adjustments to Actual Deferral Percentages . . . . . . . . . . . . . . . . . . . . . . . . 33
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7.4 Nondiscrimination Requirements for After Tax and Matching Contributions . . . . . . . . . . . . 34
(a) ACP Test . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(b) Multiple Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
(c) Adjustments to Average Contribution Percentages . . . . . . . . . . . . . . . . . . . . . . 35
7.5 Multiple Use of Tests . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
(a) Aggregate Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
(b) Multiple Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
(c) Correction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
(d) Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
7.6 Order of Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
7.7 Code Section 415 Limitations on Maximum Allocations . . . . . . . . . . . . . . . . . . . . . . 37
(a) No Other Plan Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
(b) Other Master or Prototype Plan Participation . . . . . . . . . . . . . . . . . . . . . . . 38
(c) Other Non-Master or Non-Prototype Plan Participation . . . . . . . . . . . . . . . . . . . 39
(d) Defined Benefit Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
(e) Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
7.8 Special Requirements for Plans Covering Owner-Employees . . . . . . . . . . . . . . . . . . . . 41
(a) Aggregation of Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
(b) Comparable Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(c) Controlled and Noncontrolled Businesses . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(d) Definition of "Controlled" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(e) Definition of "Owner-Employee" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
7.9 Distribution Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(a) Controlling Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(b) Required Beginning Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(c) Limits on Distribution Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
(d) Determination of Amount to be Distributed Each Year . . . . . . . . . . . . . . . . . . . . 43
(e) Death Distribution Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
(f) Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
(g) Transitional Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
7.10 Construction of Limitations and Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . 46
ARTICLE VIII INVESTMENT OF ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
8.1 Establishment of Trust Fund; Investment of Assets . . . . . . . . . . . . . . . . . . . . . . . 47
8.2 Investment Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(a) Named Investment Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(b) Other Investment Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(c) Reinvestment of Cash Earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
8.3 Participant Direction of Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(a) Investment of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
(b) Investment of Existing Account Balances . . . . . . . . . . . . . . . . . . . . . . . . . . 48
(c) Conditions Applicable to Elections . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
(d) Investment of Certain Stock Dividends and Other Assets . . . . . . . . . . . . . . . . . . 48
(e) Investments with Distributions Made in Annuity or Installment Payments . . . . . . . . . . 48
(f) Failure to Elect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
(g) Fiduciary Responsibilities of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
8.4 Valuations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
(b) Share Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
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8.5 Investment in Company Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
(b) Purchase of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
(c) Liquidation of Shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
(d) Warrants, Options . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.6 Voting and Tender Offer Rights With Respect to Company Stock . . . . . . . . . . . . . . . . . . 50
(a) Voting Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
(b) Tender Offer Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.7 Voting and Tender Offer Rights With Respect to Investment Funds Other Than
the Company Stock Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.8 Investments in Life Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.9 Single Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.10 Investments in Bank Deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
ARTICLE IX VESTING IN ACCOUNTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
9.1 General Vesting Rule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
(a) General Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
(b) Exclusions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
9.2 Vesting Upon Attainment of Normal Retirement Age, Death or Disability . . . . . . . . . . . . . 51
(a) Normal Retirement Age . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
(b) Death . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
(c) Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
9.3 Timing of Forfeitures and Vesting after Restoration Contributions . . . . . . . . . . . . . . . 51
(a) Reemployment And Vesting After Cash-Out Distribution . . . . . . . . . . . . . . . . . . . 51
(b) Reemployment and Vesting Before Any Distribution . . . . . . . . . . . . . . . . . . . . . 52
(c) Reemployment And Vesting After Other Distribution or Prior to Distribution . . . . . . . . 52
9.4 Amendment to Vesting Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52
ARTICLE X PAYMENT OF BENEFITS WITHOUT ANNUITY PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . 53
10.1 Benefit Payments Upon Separation From Service For Reasons Other Than Death . . . . . . . . . . . 53
(a) General Rule Concerning Benefits Payable . . . . . . . . . . . . . . . . . . . . . . . . . 53
(b) Timing of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
(c) Restrictions on Distributions from Before Tax and Supplemental Accounts . . . . . . . . . . 54
(d) Discontinuance Upon Reemployment or Termination of Disability . . . . . . . . . . . . . . . 55
10.2 Death Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
(a) Prior to Benefit Commencement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
(b) After Benefit Commencement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
10.3 Form of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
(a) Single Sum Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
(b) Optional Methods of Payment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
(c) Assets Distributed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
(d) Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
(e) Direct Rollover Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
(f) Payment of Amounts Invested in Company Stock Trust Fund . . . . . . . . . . . . . . . . . . 57
10.4 Beneficiary Designation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57
(b) No Designation or Designee Dead or Missing . . . . . . . . . . . . . . . . . . . . . . . . 57
10.5 Qualified Domestic Relations Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
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10.6 Hardship Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
(a) Parameters of Hardship Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
(b) Immediate and Heavy Financial Need . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
(c) Necessary to Satisfy a Financial Need . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
(d) Election to Withdraw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
(e) Payment of Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
(f) Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
10.7 Withdrawals from After Tax and Voluntary Accounts . . . . . . . . . . . . . . . . . . . . . . . 59
(a) Election to Withdraw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
(b) Payment of Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
(c) Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
10.8 Distributions and Withdrawals from Transfer Accounts . . . . . . . . . . . . . . . . . . . . . . 59
10.9 Loans to Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
(a) Grant of Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59
(b) Nondiscriminatory Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
(c) Approval of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
(d) Minimum Loan Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
(e) Maximum Loan Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
(f) Maximum Loan Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60
(g) Terms of Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(h) Adequacy of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(i) Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(j) Source of Loan Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
(k) Crediting Loan Payments to Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(l) Remedies in the Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
10.10 Unclaimed Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
10.11 Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(a) Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(b) Review Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
(c) Satisfaction of Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
10.12 Explanation of Rollover Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
ARTICLE XI PAYMENT OF BENEFITS WITH ANNUITY PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . 64
11.1 Benefits Payable Upon Separation From Service For Reasons Other Than Death . . . . . . . . . . . 64
(a) General Rule Concerning Benefits Payable . . . . . . . . . . . . . . . . . . . . . . . . . 64
(b) Timing of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
(c) Restrictions on Distributions from Before Tax and Supplemental Accounts . . . . . . . . . . 65
(d) Discontinuance Upon Reemployment or Termination of Disability . . . . . . . . . . . . . . . 66
11.2 Normal Payment Forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
11.3 Election of Optional Payment Forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
(a) Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
(b) Optional Payment Forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66
(c) Rate of Payments to Joint Annuitant or Beneficiary . . . . . . . . . . . . . . . . . . . . 67
(d) Special Rules for Installment Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 67
(e) Direct Rollover Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
(f) Provision for Annuity Payments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
11.4 Retirement Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 68
11.5 Cash-Out Payment of Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
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11.6 Assets Distributed; Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . 69
(a) Assets Distributed . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
(b) Payment of Amounts Invested . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
(c) Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
11.7 REA Transition Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
11.8 Qualified Domestic Relations Orders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
11.9 Hardship Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
(a) Parameters of Hardship Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
(b) Immediate and Heavy Financial Need . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
(c) Necessary to Satisfy a Financial Need . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
(d) Election to Withdraw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 71
(e) Payment of Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
(f) Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
11.10 Withdrawals from After Tax and Voluntary Accounts . . . . . . . . . . . . . . . . . . . . . . . 72
(a) Election to Withdraw . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
(b) Payment of Withdrawal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
(c) Effect of Outstanding Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
11.11 Withdrawals of Transfer Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
11.12 Loans to Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
(a) Grant of Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 72
(b) Nondiscriminatory Policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(c) Approval of Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(d) Consent Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(e) Minimum Loan Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(f) Maximum Loan Amount . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 73
(g) Maximum Loan Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
(h) Terms of Repayment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
(i) Adequacy of Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 74
(j) Rate of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
(k) Source of Loan Amounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
(l) Crediting Loan Payments to Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
(m) Remedies in the Event of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.13 Unclaimed Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 75
11.14 Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(a) Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(b) Review Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(c) Satisfaction of Claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
11.15 Explanation of Rollover Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
11.16 Payment of Survivor Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
(b) Exclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
11.17 Election of Optional Payment Forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
(a) Election . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
(b) Optional Payment Forms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 77
(c) Special Rules for Installment Payments . . . . . . . . . . . . . . . . . . . . . . . . . . 78
11.18 Commencement of Survivor Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
(a) Payments to Spouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
(b) Payments to a Non-Spouse Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
(c) Minimum Benefit Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
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11.19 Cash-Out Payment of Survivor Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
11.20 Death During Suspension of Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
11.21 Beneficiary Designation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
(a) General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 78
(b) No Designation or Designee Dead or Missing . . . . . . . . . . . . . . . . . . . . . . . . 79
11.22 Survivor Benefit Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
ARTICLE XII ADMINISTRATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
12.1 Administrative Committee; Appointment and Term of Office . . . . . . . . . . . . . . . . . . . . 80
(a) Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
(b) Removal, Resignation, Successor . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
(c) Certification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
12.2 Organization of Administrative Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
12.3 Powers and Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
12.4 Records of Administrative Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
(a) Execution of Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
(b) Preservation of Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
12.5 Reporting and Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
12.6 Construction of the Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
12.7 Assistants and Advisers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
(a) Retaining Advisers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
(b) Reliance on Advisers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
12.8 Bonding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
12.9 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 82
ARTICLE XIII ALLOCATION OF AUTHORITY AND RESPONSIBILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . 84
13.1 Adopting Company and Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
(a) General Responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
(b) Allocation of Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
(c) Authority of Participating Companies . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
13.2 Administrative Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
13.3 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
13.4 Limitations on Obligations of Fiduciaries . . . . . . . . . . . . . . . . . . . . . . . . . . . 84
13.5 Delegation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
13.6 Multiple Fiduciary Roles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 85
ARTICLE XIV AMENDMENT, TERMINATION AND ADOPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
14.1 Amendment of Master Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
14.2 Amendment of an Adopting Company's Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
(a) Execution of New Adoption Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
(b) Other Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
14.3 Limitation on Amendments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
14.4 Maintaining Qualified Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
14.5 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
(a) Right to Terminate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 86
(b) Vesting Upon Complete Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
(c) Liquidation of Plan Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
(d) Vesting Upon Partial Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
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14.6 Adoption of the Plan by Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
(a) Procedures for Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87
(b) Single Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
(c) Authority under Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
(d) Contributions to Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
(e) Procedure for Withdrawal from Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
(f) Effect of Withdrawal from Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
14.7 Merger, Consolidation and Transfer of Assets or Liabilities . . . . . . . . . . . . . . . . . . 88
(a) Mergers and Spin-offs Accepted . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88
(b) Spin-offs to Other Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
(c) Statutory Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
14.8 Contingent Adoption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 89
ARTICLE XV TOP-HEAVY PROVISIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
15.1 Top-Heavy Plan Years . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
15.2 Determination of Top-Heavy Status . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
(a) Application . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
(b) Special Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 90
(c) Special Rules . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91
15.3 RESERVED . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
15.4 Top-Heavy Minimum Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
(a) Multiple Defined Contribution Plans . . . . . . . . . . . . . . . . . . . . . . . . . . . . 92
(b) Defined Contribution and Benefit Plans . . . . . . . . . . . . . . . . . . . . . . . . . . 93
(c) Defined Contribution Minimum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
(d) Defined Benefit Minimum . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
15.5 Top-Heavy Minimum Vesting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
(a) Schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93
(b) Post-Top Heavy Periods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
15.6 Adjustments in Code Section 415 Limitations for Top-Heavy Plans . . . . . . . . . . . . . . . . 94
(a) Special Adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
(b) Exception . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
15.7 Special Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 94
15.8 Construction of Limitations and Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . 94
ARTICLE XVI MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
16.1 Nonalienation of Benefits and Spendthrift Clause . . . . . . . . . . . . . . . . . . . . . . . . 95
(a) General Nonalienation Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
(b) Exception for Qualified Domestic Relations Orders . . . . . . . . . . . . . . . . . . . . . 95
(c) Exception for Loans from the Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
16.2 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
16.3 Construction, Controlling Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 95
16.4 No Contract of Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
16.5 Legally Incompetent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
16.6 Heirs, Assigns and Personal Representatives . . . . . . . . . . . . . . . . . . . . . . . . . . 96
16.7 Title to Assets, Benefits Supported Only By Trust Fund . . . . . . . . . . . . . . . . . . . . . 96
16.8 Legal Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
16.9 No Discrimination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 96
16.10 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
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16.11 Exclusive Benefit; Refund of Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
(a) Permitted Refunds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
(b) Payment of Refund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
(c) Limitation on Refund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
16.12 Predecessor Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
16.13 Plan Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 97
16.14 Special Effective Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
(a) Intent of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
(b) Compliance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
16.15 Purpose and Applicability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
(a) Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
(b) Applicability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98
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ARTICLE I
ADOPTION OF PLAN
1.1 Procedure for Adoption of Plan.
(a) Procedure. An employer desiring to adopt the Plan as a new
plan or as a restatement of a Prior Plan shall file an Adoption Agreement with
the Master Plan Sponsor in such form as the Master Plan Sponsor shall require.
Upon written acceptance of the completed Adoption Agreement by the Master Plan
Sponsor, and (in the case of a new plan), upon the receipt by the Trustee of an
initial Company Contribution, a Plan shall thereby be adopted, effective as of
the Effective Date provided in the Adoption Agreement.
(b) Effect of Adoption. A Plan adopted or restated pursuant to
the terms of subsection (a) hereof may be a profit sharing plan, a Section
401(k) plan with a cash-or-deferred feature, or a combination of a profit
sharing plan and a Section 401(k) plan with a cash-or-deferred feature. The
Plan so adopted shall be governed by all of the terms and conditions of the
Master Plan and of the Adoption Agreement.
1.2 Contents of Adoption Agreements.
(a) The Adoption Agreement shall set forth the following:
(1) The Effective Date of the Plan;
(2) The required number of Years of Eligibility Service
for participation in the Plan, if any;
(3) The form of Plan being adopted and the method of
determining Company Contributions;
(4) The name, address, identification number and trade or
business of the Adopting Company;
(5) The name(s) of the Administrative Committee member(s);
and
(6) Such other information as the Trustee may require as
part of the adoption of the Plan.
(b) An Adoption Agreement may contain only such provisions as
are authorized by and consistent with the provisions of the Master Plan, and,
in the event of any inconsistency, the provisions of the Master Plan shall
control.
<PAGE> 16
ARTICLE II
DEFINITIONS
For purposes of the Master Plan, the following terms, when used with an
initial capital letter, shall have the meanings set forth below unless a
different meaning plainly is required by the context.
2.1 Account shall mean, with respect to a Participant, his Joint
Annuitant or his Beneficiary, the amount of money or other property in the
Trust Fund, as is evidenced by the last balance posted in accordance with the
terms of the Plan to the account record established for such persons. The
Administrative Committee, as required by the terms of the Plan and otherwise as
it deems necessary or desirable in its sole discretion, may establish and
maintain separate subaccounts for each Participant, his Joint Annuitant or his
Beneficiary, provided allocations are made to such subaccounts in the manner
described in Article VI of the Plan. "Account" shall refer to the aggregate of
all separate subaccounts or to individual, separate subaccounts, as may be
appropriate in context.
2.2 ACP or Average Contribution Percentage shall mean, with respect to
a specified group of Participants for a Plan Year, the average of the ratios
(calculated separately for each Participant in such group and rounded to the
nearest 1/100th of a percent) of (i) the total of the amount of After Tax
Contributions and Matching Contributions and, to the extent designated by the
Administrative Committee, the Supplemental Contributions [excluding
Supplemental Contributions counted for purposes of Section 7.3 and any
Contributions returned to a Participant or otherwise removed from his Account
to correct excess Annual Additions] actually paid to the Trustee on behalf of
each such eligible Participant for such Plan Year, to (ii) such Participant's
Compensation for such Plan Year (whether or not the Employee was a Participant
for the entire Plan Year), so long as the ADP Test is met for the elective
deferrals that are used in the ACP Test and continues to be met following the
exclusion of those elective deferrals that are used to meet the ACP Test. If a
Highly Compensated Employee participates in the Plan and one or more other
plans of any Affiliates to which matching or after tax contributions are made
(other than a plan for which aggregation with the Plan is not permitted), the
matching and after tax contributions made with respect to such Highly
Compensated Employee shall be aggregated for purposes of determining his ACP;
if two or more of these arrangements have different plan years, all cash or
deferral arrangements ending with or within the same calendar year shall be
treated as a single arrangement. The ACP shall be rounded to the nearest
1/100th of a percent and shall be calculated in a manner consistent with the
terms of Code Section 401(m) and the regulations promulgated thereunder
(including, without limitation, the family consolidation rules for certain
Highly Compensated Employees). If a Participant is eligible to participate in
the Plan for all or a portion of a Plan Year by reason of satisfying the
eligibility requirements of Article III but makes no After Tax Contributions
and if he receives no allocations of Matching Contributions or Supplemental
Contributions which are taken into account (as described above) for purposes of
calculating his ACP, such Participant's ACP for such Plan Year shall be zero.
2.3 ACP Tests shall mean the nondiscrimination tests described in
Section 7.4. As a condition to participate in the Plan, each Participating
Company shall maintain such records as the Administrative Committee shall deem
necessary or desirable to demonstrate compliance with the ACP Tests. Such
records shall include, but shall not be limited to, information concerning the
extent to which Supplemental Contributions are taken into account with respect
to the ACP Tests.
2.4 Active Participant shall mean, for any Plan Year (or any portion
thereof), any Covered Employee who, pursuant to the terms of Article III, has
been admitted to, and not removed from, active participation in the Plan since
the last date his employment commenced or recommenced.
2.5 Administrative Committee shall mean the committee designated by
the Board that shall act on behalf of the Adopting Company to administer the
Plan as provided in Article XII. The Administrative Committee shall be the
plan administrator, as that term is defined in Code Section 414(g); provided,
the Adopting Company may act in lieu of the Administrative Committee as it
deems appropriate or desirable.
2
<PAGE> 17
2.6 Adopting Company shall mean an employer which adopts and completes
an Adoption Agreement establishing the Plan.
2.7 Adoption Agreement shall mean the written instrument which shall
be executed by each Adopting Company in order to adopt a Plan and make
contributions to the Trust.
2.8 ADP or Actual Deferral Percentage shall mean, with respect to a
specified group of Participants for a Plan Year, the average of the ratios
(calculated separately for each Participant in such group and rounded to the
nearest 1/100th of a percent) of (i) the total of the amount of Before Tax
Contributions (excluding Before Tax Contributions, if any, designated by the
Administrative Committee to be taken into account under Section 7.4(c)(1) to
help satisfy the ACP Tests, or returned to a Participant to correct excess
Annual Additions) and, to the extent designated by the Administrative
Committee, the Supplemental Contributions [excluding Supplemental Contributions
counted for purposes of Section 7.4(c)] actually paid to the Trustee on behalf
of each such Participant for such Plan Year, to (ii) such Participant's
Compensation for such Plan Year. If a Highly Compensated Employee participates
in the Plan and one or more other plans of any Affiliates to which before tax
contributions are made (other than a plan for which aggregation with the Plan
is not permitted), the before tax contributions made with respect to such
Highly Compensated Employee shall be aggregated for purposes of determining his
ADP. The ADP shall be rounded to the nearest 1/100th of a percent and shall be
calculated in a manner consistent with the terms of Code Section 401(k) and the
regulations promulgated thereunder (including, without limitation, the family
consolidation rules for certain Highly Compensated Employees). If a
Participant is eligible to participate in the Plan for all or a portion of a
Plan Year by reason of satisfying the eligibility requirements of Article III
but makes no Before Tax Contributions and receives no allocation of
Supplemental Contributions which the Administrative Committee takes into
account for purposes of the ADP Tests, such Participant's ADP for such Plan
Year shall be zero percent.
2.9 ADP Tests shall mean the nondiscrimination tests described in
Section 7.3. As a condition to participate in the Plan, each Participating
Company shall maintain such records as the Administrative Committee shall deem
necessary or desirable to demonstrate compliance with the ADP Tests. Such
records shall include, but shall not be limited to, information concerning the
extent to which Supplemental Contributions are taken into account in respect to
the ADP Tests.
2.10 Affiliate shall mean, as of any date, (i) a Participating Company,
and (ii) any company, person or organization which, on such date, (A) is a
member of the same controlled group of corporations [within the meaning of Code
Section 414(b)] as is a Participating Company; (B) is a trade or business
(whether or not incorporated) which controls, is controlled by or is under
common control [within the meaning of Code Section 414(c)] with a Participating
Company; (C) is a member of an affiliated service group [as defined in Code
Section 414(m)] which includes a Participating Company; or (D) is required to
be aggregated with a Participating Company pursuant to regulations promulgated
under Code Section 414(o); provided, solely for purposes of Section 7.7, the
term "Affiliate" as defined in this Section shall be deemed to include
corporations that would be Affiliates if the phrase "more than 50 percent" were
substituted for the phrase "at least 80 percent" in each place the latter
phrase appears in Code Section 1563(a)(1).
2.11 After Tax Account shall mean the separate subaccount established
and maintained on behalf of a Participant to reflect his interest in the Trust
Fund attributable to After Tax Contributions.
2.12 After Tax Contributions shall mean the amounts that are included
in a Participant's gross income for a year and that are paid by a Participating
Company to the Trust Fund at the election of Participants or the amounts paid
by Participants to the Trust Fund, all pursuant to the terms of Section 4.2(b).
2.13 After Tax Deferral Election shall mean a written election by an
Active Participant directing the Participating Company of which he is an
Employee to withhold a portion of his current Compensation from his paychecks
and to contribute such withheld amount to the Plan as an After Tax
Contribution, all as provided in Section 4.2(b) and Section 4.2(d).
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<PAGE> 18
2.14 Annual Addition shall mean the sum of the amounts described in
Section 7.7(e)(i).
2.15 Before Tax Account shall mean the separate subaccount established
and maintained on behalf of a Participant to reflect his interest in the Trust
Fund attributable to his Before Tax Contributions.
2.16 Before Tax Contributions shall mean the amounts paid by each
Participating Company to the Trust Fund at the election of Participants, all
pursuant to the terms of Section 4.2(a).
2.17 Before Tax Deferral Election shall mean a written election by an
Active Participant directing the Participating Company of which he is an
Employee to withhold a portion of his current Compensation from his paychecks
and to contribute such withheld amount to the Plan as a Before Tax
Contribution, all as provided in Section 4.2(a) and Section 4.2(d).
2.18 Beneficiary shall mean the person(s) designated in accordance with
Section 10.4 or Section 11.21 to receive any death benefits that may be payable
under the Plan upon the death of a Participant.
2.19 Benefit Commencement Date shall mean, with respect to a
Participant, Joint Annuitant or Beneficiary, the first day of the first period
for which payment of his benefit under the Plan is scheduled to commence,
either as a result of his written election or by operation of the Plan.
2.20 Board or Board of Directors shall mean the board of directors of
the Adopting Company. A reference to the board of directors of any other
Participating Company shall specify it as such.
2.21 Break in Service shall mean, with respect to an Employee, any year
during which such Employee fails to complete more than 500 Hours of Service;
provided, a Break in Service shall not be deemed to have occurred during any
period for which he is granted a Leave of Absence if he returns to the service
of an Affiliate within the time permitted as set forth in the Plan. A Break in
Service shall be deemed to have commenced on the first day of the year in which
it occurs.
For purposes of determining whether or not an Employee has incurred a
Break in Service, an Employee absent from work due to a Maternity or Paternity
Leave shall be credited with (i) the number of Hours of Service with which he
normally would have been credited but for the Maternity or Paternity Leave, or
(ii) if the Administrative Committee is unable to determine the hours described
in (i), 8 Hours of Service for each day of absence included in the Maternity or
Paternity Leave; provided, the maximum number of Hours of Service credited for
purposes of this Section shall not exceed 501 hours. Hours of Service so
credited shall be applied only to the year in which the Maternity or Paternity
Leave begins, unless such Hours of Service are not required to prevent the
Employee from incurring a Break in Service, in which event such Hours of
Service shall be credited to the Employee in the immediately following year.
No Hour of Service shall be credited due to Maternity or Paternity Leave as
described in this Section unless the Employee furnishes proof satisfactory to
the Administrative Committee (A) that his absence from work was due to a
Maternity or Paternity Leave and (B) of the number of days he was absent due to
the Maternity or Paternity Leave. The Administrative Committee shall prescribe
uniform and nondiscriminatory procedures by which to make the above
determinations.
As used in this Section, the term "year" shall mean the same 12-month
period as forms the basis for determining a Year of Eligibility Service or a
Year of Vesting Service, as applicable.
2.22 Code shall mean the Internal Revenue Code of 1986, as amended, and
any succeeding federal tax provisions.
2.23 Company Contribution Account shall mean the separate subaccount
established and maintained on behalf of a Participant to reflect his interest
in the Trust Fund attributable to Company Contributions.
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<PAGE> 19
2.24 Company Contributions shall mean Before Tax, Matching,Supplemental
and Profit Sharing Contributions, if any, made by the Participating Companies
pursuant to the terms of the Plan.
2.25 Company Stock shall mean the voting common stock of the Adopting
Company.
2.26 Company Stock Trust Fund shall mean the total amount of cash,
Company Stock and other property held by the Company Stock Trustee (or any
nominee) under the Company Stock Trust Agreement.
2.27 Company Stock Trust or Company Stock Trust Agreement shall mean
the trust agreement between the Adopting Company and the Company Stock Trustee
which shall be established primarily for the purpose of investing Plan assets
in Company Stock. The Company Stock Trust shall be separate from the Master
Trust.
2.28 Company Stock Trustee shall mean the party or parties so
designated from time to time pursuant to the Company Stock Trust Agreement.
2.29 Compensation shall have the meaning set forth in subsection (a),
(b), (c) or (d), whichever is applicable; provided, in no event shall the
annual compensation taken into account under the Plan for Plan Years (or other
applicable periods) beginning after December 31, 1988 exceed $200,000
[($150,000 for Plan Years (or other applicable periods) beginning after
December 31, 1993)] (as adjusted by the Secretary of the Treasury under Code
Section 401(a)(17) for cost of living increases and prorated on the basis of
months for any applicable period less than 12 months). In determining the
Compensation of a Participant for purposes of the Code Section 401(a)(17)
maximum compensation limitation, the rules of Code Section 414(q)(6) shall
apply; provided, for purposes of applying such rules, the term "family" shall
include only the Spouse of the Participant and any lineal descendants of the
Participant who have not attained age 19 before the close of the year. If, as
a result of the application of such rules the adjusted Code Section 401(a)(17)
maximum compensation limitation is exceeded, then (except for purposes of
determining the portion of Compensation up to the integration level if the Plan
provides for permitted disparity) the limitation shall be prorated among the
affected individuals as determined under this Section prior to the application
of this limitation.
(a) Benefit Compensation. For purposes of determining the
amount of Company Contributions in Section 4.2, the maximum amount of Matching
Contributions in Section 4.3 and the allocation of Profit Sharing Contributions
and excess Forfeitures in Section 6.4 and for all other purposes except as set
forth in subsections (b), (c) and (d) hereof, "Compensation" shall mean, for
any Plan Year, the total of the amounts described in subsections (1) plus (2).
(1) (A) with respect to common law Employees (that is,
those not self-employed), all wages as defined in Code Section
3401(a) for purposes of income tax withholding at the source, that
are reportable for federal income tax purposes on IRS Form W-2,
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 [such as the exemption
for agricultural labor in Code Section 3401(a)(2)], and
(B) with respect to self-employed Employees, all net
earnings from self-employment [as defined in Code Section
1402(a)], which are derived from the trade or business of the
Participating Company, as determined in accordance with Code
Section 401(c)(2), and for which personal services of the
Participant are a material income-producing factor. For purposes
of this subsection, "Self-employed Employee" shall mean an
Employee who has earned income for the taxable year from the trade
or business of the Participating Company; or would have had earned
income but for the fact the Participating Company had no net
profits for the taxable year. Net earnings will be (i) determined
without regard to items not included in gross income and the
deductions allocable to such items, and (ii) reduced by
contributions by the Participating Company to a qualified plan to
the extent deductible under Code Section 404, and determined with
regard to the deduction allowed to the taxpayer by Code Section
164(f) for taxable years beginning after December 31, 1989; plus
(2) all before-tax, salary deferral or reduction
contributions made to Code Section 401(k) and Section 125 plans of the
Participating Companies on behalf of a Participant for such Plan Year
[including any contributions made under Code Section Section 125,
402(e)(3), 402(h)(1)(B) or 403(b)].
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<PAGE> 20
"Compensation" shall not include any amounts paid or made available to
the Participant for any period in the Plan Year during which he is not an
Active Participant.
(b) Section 415 Compensation. Solely for purposes of Section
7.1 (relating to maximum deductible contribution limitations under Code Section
404), Section 7.2 (relating to maximum contribution and benefit limitations
under Code Section 415) and Section 15.4 (relating to minimum Contributions
under a Top-Heavy Plan), "Compensation" shall mean, with respect to a
Participant for a Plan Year, the amounts from all Affiliates referred to in
subsection (a)(1).
(c) Key Employee Compensation. Solely for purposes of
determining which Employees are Key Employees under Section 15.2 and which
Employees are Highly Compensated Employees under Section 2.51, for any
applicable Plan Year, "Compensation" shall mean the total amount determined
under subsections (a)(1) plus (a)(2) hereof.
(d) Testing Compensation. For purposes of performing
discrimination testing to ensure compliance with Code Section 401(a)(4),
Section 401(k) and Section 401(m), the definition of "Compensation" as set
forth in subsection (a) hereof generally shall be used; provided, on a plan
year-by-plan year basis, the Administrative Committee may elect to use the
definition of"Compensation" as set forth in subsection (b) or (c) hereof, or
any other definition that satisfies the nondiscrimination requirements of Code
Section 414(s).
2.30 Continuous Service. For purposes of determining eligibility to
participate in the Plan, a Covered Employee is considered to be performing
Continuous Service if he is regularly scheduled to work 20 or more hours of
service per week for a Participating Company.
2.31 Contributions shall mean, individually or collectively, the Before
Tax, After Tax, Matching, Supplemental, Profit Sharing, Restoration, Rollover
and Transfer Contributions permitted under the Plan.
2.32 Covered Employee shall mean an Employee of a Participating Company
other than:
(a) An Employee who is a "leased employee" within the meaning of
Section 2.46, except that such Employees shall be Covered Employees with
respect to a Plan Year if exclusion of such Employees for such Plan Year would
cause the Plan to fail to meet the minimum participation requirements of the
Code, including Code Section 401(a)(26) and Section 410(b) for such Plan Year;
or
(b) An Employee who is a member of a collective bargaining unit,
unless (i) the terms of the collective bargaining agreement between the
Participating Company of the Employee and the bargaining unit require that the
Employee be eligible to participate in the Plan, or (ii) retirement benefits
were not the subject of good faith bargaining between the Participating Company
and the bargaining unit.
2.33 Deferral Election shall mean a written election by an Active
Participant directing the Participating Company of which he is an Employee to
withhold a portion of his current Compensation from his paychecks and to
contribute such withheld amount to the Plan as Before Tax and/or After Tax
Contributions, all as provided in Section 4.2.
2.34 Defined Benefit Minimum shall mean the minimum benefit level
described in Section 15.4(d).
2.35 Defined Benefit Plan shall mean any qualified retirement plan
maintained by an Affiliate that is not a Defined Contribution Plan.
2.36 Defined Benefit Fraction shall mean the fraction described in
Section 7.7(e)(iii).
2.37 Defined Contribution Minimum shall mean the minimum contribution
level described in Section 15.4(c).
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<PAGE> 21
2.38 Defined Contribution Plan shall mean any qualified retirement plan
maintained by an Affiliate that provides an individual account for each
Participant and for benefits based on the amount contributed to that account
plus investment experiences thereon.
2.39 Defined Contribution Fraction shall mean the fraction described in
Section 7.7(e)(v).
2.40 Determination Date shall mean the date described in Section
15.2(b)(1).
2.41 Disability or Disabled shall mean a medically determinable
physical or mental impairment of a Participant which is continuing and which
qualifies the Participant for long term disability benefits under the group
long term disability insurance plan then provided by the Georgia Bankers
Association Insurance Trust for Employees other than officers (or which would
qualify the Participant for benefits if he was covered under such plan). The
initial and continuing Disability of a Participant shall be determined by the
Administrative Committee based on competent medical authority and any other
evidence. If a Participant refuses to furnish the Administrative Committee
with information requested regarding his Disability for a 12-consecutive-month
period, such Participant shall not be entitled to disability benefits under the
Plan for such Disability.
2.42 Effective Date shall mean the date specified in Section 1.2 of the
Adoption Agreement as the effective date of the Plan. The term shall also mean
the effective date of the Joinder Agreement of an Affiliate which adopts the
Plan.
2.43 Elective Deferrals shall mean, with respect to a Participant for
any calendar year, the total amount of his Before Tax Contributions plus such
other amounts as shall be determined pursuant to the terms of Code Section
402(g)(3).
2.44 Eligible Retirement Plan shall mean a plan which is a defined
contribution plan, the terms of which permit the acceptance of rollover
distributions and which is either (i) an individual retirement account
described in Code Section 408(a), (ii) an individual retirement annuity
described in Code Section 408(b) (other than an endowment contract), (iii) a
qualified trust described in Code Section 401(a) and exempt from taxation under
Code Section 501(a), or (iv) an annuity plan described in Code Section 403(a).
In the case of a distribution to the Surviving Spouse, Eligible Retirement Plan
shall mean the Plan described in either clause (i) or (ii) hereof.
2.45 Eligible Rollover Distribution shall mean any distribution to an
employee of all or any portion of the balance to his credit in a qualified
trust (including any distribution to a Participant of all or any portion of his
Account); provided an employee's "Eligible Rollover Distribution" shall not
include (i) any distribution which is one of a series of substantially equal
periodic payments made not less frequently than annually, (A) for the life of
the employee and his beneficiary, or (B) for a specified period of 10 years or
more, and (ii) any distribution to the extent such distribution is required
under Code Section 401(a)(9), (iii) the portion of any distribution that is not
includable in gross income of the employee and (iv) distributions which total
less than $200 during the Plan Year.
2.46 Employee shall mean any individual who is employed by an Affiliate
(including officers, but excluding directors who are not officers or otherwise
employees) and shall include leased employees of an Affiliate.
For purposes of the Plan, the term "leased employee" means any
person (other than an employee of the recipient) who pursuant to an agreement
between the recipient and any other person ("leasing organization") has
performed services for the recipient (or for the recipient and related persons
determined in accordance with Code Section 414(n)(6)) on a substantially full
time basis for a period of at least 1 year, and such services are of a type
historically performed by employees in the business field of the recipient
employer. Contributions or benefits provided a leased employee by the leasing
organization which are attributable to services performed for the recipient
employer shall be treated as provided by the recipient employer.
A leased employee shall not be considered an employee of the
recipient if: (i) such employee is covered by a money purchase pension plan
providing: (1) a nonintegrated employer contribution rate of at least 10
percent of compensation, as defined in Code Section 415(c)(3), but including
amounts contributed pursuant to a salary reduction
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<PAGE> 22
agreement which are excludable from the employee's gross income under Code
Section 125, Section 402(e)(3), Section 402(h)(1)(B) or Section 403(b), (2)
immediate participation, and (3) full and immediate vesting; and (ii) leased
employees do not constitute more than 20 percent of the recipient's nonhighly
compensated work force.
2.47 Entry Date shall mean the first day of every month during the
period in which the Plan remains in effect.
2.48 ERISA shall mean the Employee Retirement Income Security Act of
1974, as amended.
2.49 Excess Compensation shall mean, with respect to any Plan Year, the
amount by which the Compensation for such Plan Year of a Participant who is
eligible to receive an allocation pursuant to Section 6.4(a) exceeds the
Taxable Wage Base for the calendar year ending with or during such Plan Year.
2.50 Forfeiture shall mean, for any Plan Year, the dollar amount of an
Account of a Participant that is removed from the Account during such Plan Year
and that is applied in accordance with the election made in Section 4.8 of the
Adoption Agreement.
2.51 Highly Compensated Employee shall mean an employee of an Affiliate
who is described in subsections (a)(1), (2), (3) or (4) below, as modified by
subsections (b), (c), (d) and (e) hereof:
(a) General Rule.
(1) An employee who at any time during the current Plan
Year or the immediately preceding Plan Year owned [or was considered as
owning within the constructive ownership rules of Code Section 318 as
modified by Code Section 416(i)(1)(B)(iii)] more than 5 percent of the
outstanding stock of a corporate Affiliate or stock possessing more than
5 percent of the total combined voting power of all stock of a corporate
Affiliate or more than 5 percent of the capital or profits interest in a
noncorporate Affiliate; or
(2) An employee who at any time during the immediately
preceding Plan Year:
(A) received Compensation from an Affiliate in
excess of $75,000 [as adjusted by the Secretary of Treasury under
Code Section 414(q) [which references Code Section 415(d)] and the
regulations promulgated thereunder for cost of living increases];
or
(B) received Compensation from an Affiliate in
excess of $50,000 [as adjusted by the Secretary of Treasury under
Code Section 414(q) [which references Code Section 415(d)] and the
regulations promulgated thereunder for cost of living increases]
and during the same Plan Year was within the group consisting of
the most highly compensated 20 percent of the employees of all
Affiliates;
provided, the Adopting Company may elect with respect to any Plan Year
(i) to change the "$75,000" dollar amount in subsection (a)(2)(A) to
"$50,000", and (ii) to disregard subsection (a)(2)(B) in its entirety, as
long as at all times during such Plan Year the Adopting Company and its
Affiliates maintain significant business activities and employ employees
in at least two significantly separate geographical areas, and the
Adopting Company and its Affiliates satisfy such other conditions as may
be required under Code Section 414(q)(12) and regulations promulgated
thereunder; or
(3) An employee who at any time during the immediately
preceding Plan Year was an officer of an Affiliate whose Compensation for
the Plan Year was greater than 50 percent of the dollar limitation in
effect under Code Section 415(b)(1)(A) for the calendar year in which the
Plan Year ends, where the term "officer" means an administrative
executive in regular and continual service with an Affiliate; provided,
in no event shall the number of officers exceed the lesser of subsections
(A) or (B) of this subsection (a)(3), where:
(A) equals 50; and
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<PAGE> 23
(B) equals the greater of 3 employees or 10 percent
of the number of employees [including leased employees as defined
in Code Section 414(n)] of any Affiliate during the Plan Year.
If for any year no officer meets the requirements of this subsection
(a)(3), the highest paid officer for the Plan Year shall be considered a
person who satisfies the requirements of this subsection (a)(3); or
(4) An employee who at any time during the current Plan
Year meets the requirements of subsection (a)(2) or (3) above and whose
Compensation for the current Plan Year is such that the employee was in
the group of the 100 employees being paid the greatest amount of
Compensation by all Affiliates.
(b) Excluded Employees. For purposes of subsections (a)(2)(B)
and (a)(3) hereof, the following may be excluded when determining the most
highly compensated 20 percent of the employees and the total number of
officers, respectively, of an Affiliate:
(1) employees who have not completed 6 months of service;
(2) employees who normally work fewer than 17-1/2 hours
per week;
(3) employees who normally work during not more than 6
months during any Plan Year;
(4) employees who have not attained age 21; and
(5) 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 an
Affiliate.
(c) Family Rules. For purposes of this Section, if any employee
is a member of the family of a 5 percent owner as defined in subsection (a)(1)
hereof or a member of the family of a Highly Compensated Employee whose
Compensation is such that he is among the ten Highly Compensated Employees
receiving the greatest amount of Compensation from all Affiliates during the
Plan Year, then (i) the employee shall not be considered a separate employee,
and (ii) any Compensation paid to the employee, and any applicable contribution
or benefit on behalf of the employee, shall be treated as if it were paid to,
or on behalf of, the 5 percent owner or the employee who is among the ten
Highly Compensated Employees receiving the greatest amount of Compensation from
all Affiliates during the Plan Year. For purposes of this subsection (c), the
term "family" means with respect to any employee, the employee's spouse, lineal
descendants or ascendants and the spouses of such lineal descendants or
ascendants.
(d) Former Employees. For purposes of this Section, a former
employee shall be treated as a Highly Compensated Employee if (i) the former
employee was a Highly Compensated Employee at the time the employee separated
from service with all Affiliates or (ii) the former employee was a Highly
Compensated Employee at any time after he attained age 55.
(e) Nonresident Aliens. For purposes of this Section,
nonresident aliens who receive no earned income from an Affiliate which
constitutes income from sources within the United States [as described in Code
Section 414(q)(11)] shall not be treated as employees.
(f) Compliance with Code Section 414(q). The determination of
who is a "Highly Compensated Employee", including all of the parts of that
definition, shall be made in accordance with Code Section 414(q) and the
regulations promulgated thereunder.
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<PAGE> 24
2.52 Hour of Service shall mean the increments of time described in
subsection (a) hereof, as modified by subsections (b), (c) and (d) hereof:
(a) General Rule.
(1) Each hour for which an Employee is paid, or entitled
to payment, for the performance of duties for an Affiliate during the
applicable computation period;
(2) Each hour for which an Employee is paid, or entitled
to payment, by an Affiliate on account of a period of time during which
no duties are performed (irrespective of whether the employment
relationship has terminated) due to vacation, holiday, illness,
incapacity (including disability), layoff, jury duty, military duty or
Leave of Absence; provided:
(A) No more than 501 Hours of Service shall be
credited under this subsection (2) to an Employee for any single
continuous period during which he performs no duties as an
employee of an Affiliate (whether or not such period occurs in a
single computation period);
(B) An hour for which an Employee is directly or
indirectly paid, or entitled to payment, on account of a period
during which he performs no duties as an employee of an Affiliate
shall not be credited as an Hour of Service if such payment is
made or due under a plan maintained solely to comply with
applicable workers' compensation, unemployment compensation or
disability insurance laws; and
(C) Hours of Service shall not be credited to an
Employee for a payment which solely reimburses such Employee for
medical or medically related expenses incurred by him.
(D) Hours of Service credited under this subsection
(a)(2) will be credited for the computation period(s) in which the
duties were or would have been performed.
For purposes of this subsection (2), a payment shall be deemed to be made
by or due from an Affiliate regardless of whether such payment is made by
or due from an Affiliate directly, or indirectly through, among others, a
trust fund or insurer, to which the Affiliate 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; and
(3) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by an Affiliate;
provided, the same Hours of Service shall not be credited both under
subsection (1) or subsection (2), as the case may be, and under this
subsection (3); and, provided further, crediting of Hours of Service for
back pay awarded or agreed to with respect to periods described in
subsection (2) shall be subject to the limitations set forth in that
subsection. The Hours of Service credited under this subsection (a)(3)
will be credited for the computation period(s) to which the award or
agreement pertains rather than the computation period(s) in which the
award, agreement or payment is made.
(b) Equivalencies. Each Employee for whom an Affiliate does not
keep records of actual Hours of Service shall be credited, in accordance with
this Section and applicable regulations promulgated by the Department of Labor,
as follows:
(i) If a daily basis is used, the Employee shall be
credited with 10 Hours of Service for each day for which the Employee
would be credited with at least one Hour of Service;
(ii) If a weekly basis is used, the Employee shall be
credited with 45 Hours of Service for each week for which the Employee
would be credited with at least one Hour of Service;
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<PAGE> 25
(iii) If a semi-monthly basis is used, the Employee shall be
credited with 95 Hours of Service for each semi-monthly period for which
the Employee would be credited with at least one Hour of Service; or
(iv) If a monthly basis is used, the Employee shall be
credited with 190 Hours of Service for each calendar month for which the
Employee would be credited with at least one Hour of Service.
The exact basis for determining the number of Hours of Service to be credited
to any Employee shall be determined by the Administrative Committee from time
to time so as to facilitate administration and to reflect the purposes of the
Plan; provided the same basis shall be used for all similarly situated
Employees. Further, no change shall be effective as to any Plan Year for which
allocations have been made pursuant to Article VI at the time such change is
made.
(c) DOL Standards. Hours of Service shall be credited and
determined in compliance with Department of Labor Regulation Section
2530.200b-2(b) and (c), 29 CFR Part 2530, as may be amended from time to time,
or such other federal regulations as may from time to time be applicable.
(d) Computation Period. For purposes of this Section, a
"computation period" shall mean the 12-month period that forms the basis for
determining an Employee's Years of Eligibility Service or Years of Vesting
Service, whichever is applicable.
2.53 Integration Level shall mean the Taxable Wage Base.
2.54 Integration Tax Rate shall mean, with respect to any Plan Year,
the greater of (A) 5.7 percent or (B) the percentage equal to the portion of
the rate of tax under Code Section 3111(a) in effect on the first day of such
Plan Year which is attributable to old-age insurance.
2.55 Investment Fund or Funds shall mean the investment funds
established from time to time pursuant to procedures adopted by the
Administrative Committee.
2.56 Joinder Agreement shall mean the agreement pursuant to which an
Affiliate adopts the Plan of an Adopting Company, as provided in Section 14.6.
2.57 Joint Annuitant shall mean the person(s) designated as such by a
Participant (or deemed designated as such under the terms of the Plan) in
accordance with Section 11.3 to receive any retirement or termination benefits
that may be payable under Article XI upon the death of the Participant.
2.58 Joint and 50% or 100% Survivor Annuity shall mean, with respect to
a Participant, a retirement benefit in the form described in Section
11.3(b)(2).
2.59 Key Employee shall mean the persons described in Section
15.2(b)(2).
2.60 Leave of Absence shall mean an excused leave of absence granted to
an Employee by an Affiliate in accordance with applicable federal or state law
or the Affiliate's personnel policy; provided, Leave of Absence shall be
granted to an Employee:
(a) who leaves the service of an Affiliate, voluntarily or
involuntarily, to enter the Armed Forces of the United States; provided, (i)
the Employee is legally entitled to reemployment under the veteran's
reemployment rights provisions as codified at 38 USC Section 2021, et seq., its
predecessors and successors; and (ii) the Employee applies for and reenters
service with an Affiliate within the time, in the manner and under the
conditions prescribed by law; and
(b) under such other circumstances as the Administrative
Committee shall determine are fair, reasonable and equitable, as applied
uniformly among Employees under similar circumstances.
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2.61 Life Annuity shall mean, with respect to a Participant, a
retirement benefit in the form described in Section 11.3(b)(1).
2.62 Limitation Year shall mean the year described Section 7.7(e)(viii)
of the Master Plan. All qualified plans maintained by the Adopting Company
must use the same Limitation Year.
2.63 Master Plan shall mean the Georgia Bankers Association Master
Section 401(k) Profit Sharing Plan as provided herein, including all subsequent
amendments hereto.
2.64 Master Trust or Master Trust Agreement shall mean the agreement
between the Master Plan Sponsor, each Participating Company and the Master
Trustee governing the creation of the Master Trust Fund, and all amendments
thereto.
2.65 Master Trustee shall mean the party or parties so designated from
time to time pursuant to the Master Trust Agreement.
2.66 Master Trust Fund shall mean the total amount of cash and other
property held by the Master Trustee (or any nominee thereof) at any time under
the Master Trust Agreement.
2.67 Matching Account shall mean the separate subaccount established
and maintained on behalf of a Participant to reflect his interest in the Trust
Fund attributable to Matching Contributions.
2.68 Matching Contributions shall mean the amounts paid by each
Participating Company to the Trust Fund pursuant to the terms of Section 4.3.
2.69 Maternity or Paternity Leave shall mean any period, beginning on
or after January 1, 1985, during which an Employee is absent from work as an
employee of an Affiliate (i) because of the pregnancy of such Employee; (ii)
because of the birth of a child of such Employee; (iii) because of the
placement of a child with such Employee in connection with the adoption of such
child by such Employee; or (iv) for purposes of such Employee caring for a
child immediately after the birth or placement of such child.
2.70 Maximum Deferral Amount shall mean $7,000, as adjusted from time
to time in accordance with Code Section 402(g)(5).
2.71 Named Fiduciary shall mean the Adopting Company, the Board, the
Trustee and the Administrative Committee.
2.72 Net Profit shall mean, collectively with respect to the
Participating Companies, their total net income for the fiscal year, as
computed for federal income tax purposes in accordance with generally accepted
accounting principles, before deduction of state and federal income taxes and
before deduction of any contribution to this or any other qualified retirement
plan, but excluding any dividends received and any capital gains or losses
arising from the sale or exchange of assets as determined in accordance with
generally accepted accounting principles consistently applied. "Net Profit"
also shall mean an estimate of the amount to be determined under the preceding
sentence, and any such estimate may be relied upon by the Participating
Companies in lieu of the actual amount to be determined thereby.
2.73 Non-Key Employee shall mean the persons described in Section
15.2(b)(3).
2.74 Normal Retirement Age shall mean the date a Participant reaches
age 65.
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2.75 Participant shall mean any person who has been admitted to, and
has not been removed from, participation in the Plan pursuant to the provisions
of Article III. "Participant" shall include Active Participants and former
Employees who have an Account under the Plan.
2.76 Participating Company shall mean an Adopting Company, and each
Affiliate that adopts the Plan of the Adopting Company pursuant to Section
14.6. When used with reference to an Employee or Participant, the term shall
mean the Participating Company employing the Employee or Participant.
2.77 Permissive Aggregation Group shall mean the group of plans
described in Section 15.2(b)(4).
2.78 Plan shall mean, with respect to a Participating Company, the
Master Plan, the Adoption Agreement of the Adopting Company, any Joinder
Agreement and the Trust Agreement.
2.79 Plan Account shall mean the interest of each Plan in the Trust
Fund.
2.80 Plan Year shall mean the 12-month period which coincides with the
calendar year; provided, for periods prior to the date the Adoption Agreement
is signed, the Plan Year shall be determined under the Prior Plan, if any, as
in effect with respect to such period.
2.81 Portfolio shall mean one or more subaccounts within the Trust,
each comprised of a portion of Trust assets. The number and description of the
Portfolios shall be determined by the party designated by the Trustee.
2.82 Prior Plan shall mean (i) a plan, if any, sponsored by a
Participating Company as constituted on the day prior to the Effective Date and
restated and amended in the form of the Plan, or (ii) a qualified retirement
plan, if any, sponsored by an Employee's predecessor employer if assets and
liabilities of such plan, at least to the extent attributable to such Employee,
are transferred (pursuant to a merger, consideration or transfer) to the Plan.
2.83 Profit Sharing Account shall mean the separate subaccount
established and maintained on behalf of a Participant to reflect his interest
in the Trust Fund attributable to Profit Sharing Contributions and/or
Forfeitures allocated pursuant to Section 6.4.
2.84 Profit Sharing Contributions shall mean the amounts paid to the
Trust Fund by each Participating Company pursuant to the terms of Section 4.5.
2.85 Publicly Traded shall mean that a security is listed on a national
securities exchange registered under Section 6 of the Securities Exchange Act
of 1934 (15 U.S.C. 78f) or 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).
2.86 Qualified Employer Plan shall mean any plan which is, or is
determined to be, a qualified employer plan under Code Section 72(p)(4).
2.87 Qualified Retirement Election shall mean an election which relates
to retirement and termination benefits described in Article XI, which satisfies
the criteria of this Section and pursuant to which (i) an unmarried Participant
designates a Joint Annuitant and/or waives the normal form of benefit by
selecting an alternative form of benefit payable to him and/or his Joint
Annuitant, or (ii) a married Participant designates a non-spouse Joint
Annuitant and/or waives the normal form of benefit by selecting an alternative
form of benefit payable to him and/or his Joint Annuitant. Such election must
be in writing and, if the Participant is married, must be consented to by the
Participant's Spouse. The Spouse's consent to such election must acknowledge
the effect of such election and must be witnessed by a notary public or a Plan
representative. Notwithstanding this spousal consent requirement, if the
Participant establishes to the satisfaction of the Administrative Committee
that such written consent may not be obtained because he has no Spouse, his
Spouse cannot be located or such other permissible circumstances exist as the
Secretary of the Treasury may by regulations prescribe, such election signed
only by the Participant may be deemed
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a Qualified Retirement Election. Any consent necessary under this provision
will be valid only with respect to the Spouse who signs the consent or, in the
event of a deemed Qualified Retirement Election, the designated Spouse. A
revocation of a prior election may be made by a Participant, without the
consent of his Spouse, if any, at any time before the Participant's Benefit
Commencement Date; the number of revocations shall not be limited. Besides a
revocation, a married Participant may not change the designated non-spousal
Joint Annuitant and/or form of benefit without spousal consent (which
acknowledges his right to limit his consent to one Joint Annuitant or benefit
form), unless the consent of his Spouse expressly permits designations by the
Participant without additional consent by his Spouse.
2.88 Qualified Separation shall mean a separation by an employee from
the active employ of an Affiliate (i) on or after his obtaining Normal
Retirement Age, (ii) on account of his becoming Disabled, (iii) due to his
death, or (iv) on account of a Leave of Absence or Maternity or Paternity
Leave.
2.89 Qualified Spousal Waiver shall mean a written election executed by
a Spouse, delivered to the Administrative Committee and witnessed by a notary
public or a Plan representative, which consents to the payment of all or a
specified portion of a Participant's death benefit to a Beneficiary other than
such Spouse and which acknowledges that such Spouse has waived his right to be
the Participant's Beneficiary under the Plan. A Qualified Spousal Waiver shall
be valid only with respect to the Spouse who signs it and shall apply only to
the alternative Beneficiary designated therein, unless the written election
expressly permits other designations without further consent of the Spouse. A
Qualified Spousal Waiver shall be irrevocable unless revoked by the Participant
by way of (i) a written statement executed by the Participant and delivered to
the Administrative Committee or (ii) a written revocation of the nonspouse
Beneficiary designation to which such Spouse has consented; provided, any such
revocation must be received by the Administrative Committee prior to the
Participant's date of death.
2.90 Required Aggregation Group shall mean the group of plans described
in Section 15.2(b)(5).
2.91 Restoration Contributions shall mean the amounts paid to the Trust
Fund by or on behalf of a rehired individual pursuant to the terms of Section
4.9.
2.92 Rollover Account shall mean the separate subaccount established
and maintained on behalf of a Participant to reflect his interest in the Trust
Fund attributable to Rollover Contributions.
2.93 Rollover Contributions shall mean the amounts contributed to the
Trust Fund (and received and accepted by the Trustee) as "rollover"
contributions as defined in Code Section 402 and/or Eligible Rollover
Distributions. An amount shall be treated as a Rollover Contribution only to
the extent that its acceptance by the Trustee is permitted under the Code
(including the regulations and rulings promulgated thereunder).
2.94 Special Bonus shall mean any bonus with respect to which a
Participant may make an election to have his Participating Company (i) reduce
the amount thereof payable to such Participant, and (ii) contribute the amount
of such reduction to his Before Tax Account, all pursuant to Section 4.2.
2.95 Special Bonus Election shall mean a written election by an Active
Participant directing his Participating Company to withhold a percentage or
amount of a paycheck or bonus check designated by such Participant and to
contribute such withheld amount to the Plan as a Before Tax Contribution, all
as provided in Section 4.2.
2.96 Spouse or Surviving Spouse shall mean, with respect to a
Participant, the person who is or was treated as married to such Participant
under the laws of the state in which the Participant resides. The
determination of a Participant's Spouse or Surviving Spouse shall be made as of
the earlier of the date as of which benefit payments from the Plan to such
Participant are made or commence (as applicable) or the date of such
Participant's death. In addition, a Participant's former spouse shall be
treated as his Spouse or Surviving Spouse to the extent provided under a
qualified domestic relations order, as defined in Code Section 414(p).
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2.97 Supplemental Account shall mean the separate subaccount
established and maintained on behalf of a Participant to reflect his interest
in the Trust Fund attributable to Supplemental Contributions.
2.98 Supplemental Contributions shall mean the amounts paid to the
Trust Fund by each Participating Company pursuant to the terms of Section 4.4.
2.99 Survivor Annuity shall mean, with respect to a Beneficiary, a
survivor benefit in the form prescribed in Section 11.16.
2.100 Taxable Wage Base shall mean, with respect to any Plan Year, the
contribution and benefit base under Section 230 of the Social Security Act (42
U.S.C. Section 430) as in effect at the beginning of such Plan Year.
2.101 Top-Heavy Group shall mean the group of plans described in
Section 15.2(b)(6).
2.102 Top-Heavy Plan shall mean a plan to which the conditions set
forth in Article XV apply.
2.103 Transfer Account shall mean one or more separate subaccounts
established and maintained on behalf of a Participant reflect his interest in
the Trust Fund attributable to Transfer Contributions. "Transfer Account"
shall refer to the aggregate of all separate subaccounts established for
Transfer Contributions or to individual, separate subaccounts appropriately
described, as may be appropriate in context.
2.104 Transfer Contributions shall mean amounts which are received
either (i) by a direct trustee to trustee transfer or (ii) as part of a
spin-off, merger or other similar event, by the Trustee from the trustee or
custodian of another qualified retirement plan and held in the Trust Fund on
behalf of a Participant or Beneficiary. Transfer Contributions shall retain
the character that those contributions had under the other qualified retirement
plan; for example, after tax contributions under the prior plan shall continue
to be treated as after tax contributions when held in the Transfer Account.
2.105 Trust or Trust Agreement shall mean, collectively (except as
otherwise specifically noted herein), the Master Trust Agreement and the
Company Stock Trust Agreement, and all amendments thereto.
2.106 Trustee shall mean, collectively (except as otherwise
specifically noted herein), the Master Trustee and the Company Stock Trustee.
2.107 Trust Fund shall mean, collectively (except as otherwise
specifically noted herein), the Master Trust Fund and the Company Stock Trust
Fund.
2.108 Valuation Date shall mean the date(s) specified in Section 2.1
of the Adoption Agreement as the valuation date(s), and each interim date on
which a valuation of the Trust Fund is made; provided, the value of an Account
or the Trust Fund on a day other than a Valuation Date (or any other day on
which the Account or Trust Fund cannot be valued) shall be determined for the
immediately preceding day for which a valuation can be made.
2.109 Voluntary Account shall mean the separate Account maintained on
behalf of a Participant to reflect his interest in the Trust Fund attributable
to his Voluntary Contributions.
2.110 Voluntary Contributions shall mean the accumulated deductible
employee contributions, as defined in Code Section 72(o)(5) that a Participant
made to the Trust Fund and that were allocated to his Voluntary Account, all
pursuant to a Prior Plan and in accordance with Code Section 219.
2.111 Year of Eligibility Service shall mean a 12-consecutive-month
period during which an Employee completes no less than 1,000 Hours of Service.
For this purpose, the computation period initially shall be the
12-consecutive-month period beginning on the date the Employee first completes
an Hour of Service (or in the case
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of re-employment, the date he first performs an Hour of Service following a
Break in Service) and thereafter shall be each Plan Year, beginning with the
Plan Year which includes the first anniversary of the Employee's employment or
reemployment commencement date. Any Employee who is credited with 1,000 Hours
of Service in both the initial employment year and the first Plan Year shall be
credited with two Years of Eligibility Service. In addition, to the extent
provided in any Appendix 1 of the Adoption Agreement, Years of Eligibility
Service shall include years counted under a transferring Prior Plan and/or with
an acquired company.
In the event of a business merger, consolidation, sale or
acquisition with respect to a Participating Company, the Administrative
Committee may determine, without necessity of a Plan amendment, to credit
employees of any entity affected by such merger, consolidation, sale or
acquisition, for eligibility purposes, with past service; provided, such
determination shall be made only if there is a valid business purpose, the
determination is reasonable in light of the circumstances, and
nondiscriminatory, all within the meaning of Code Section 401(a)(4) and the
regulations thereunder. The Administrative Committee shall adopt an Appendix 1
to the Adoption Agreement to provide to the Master Plan Sponsor the information
necessary to credit such past service.
2.112 Year of Vesting Service shall mean each Plan Year during which an
Employee completes at least 1,000 Hours of Service; provided:
(a) Years of Vesting Service completed prior to a period in
which the Participant incurred five (one, for Years of Vesting Service
commencing prior to January 1, 1985) or more consecutive Breaks in Service
shall be disregarded under the Plan if the Participant had no vested interest
in his Matching or Profit Sharing Account at the time the first such Break in
Service commenced and the number of such consecutive Breaks in Service equals
or exceeds the number of his prior Years of Vesting Service.
(b) Years of Vesting Service completed after a period in which
the Participant had at least five consecutive Breaks in Service shall be
disregarded for the purpose of determining his vested interest in that portion
of his Account which accrued before such Breaks in Service.
(c) If elected by the Adopting Company pursuant to Section 2.2
of the Adoption Agreement, Years of Vesting Service shall not include periods
during which the Participating Company or an Affiliate did not maintain the
Plan, a predecessor plan or a plan of a predecessor employer.
(d) In no event shall a Participant's Years of Vesting Service
accrued as of the Effective Date, as determined under the terms of the Plan, be
less than his Years of Vesting Service accrued as of the Effective Date, as
determined under the terms of the Prior Plan.
(e) In the event of a business merger, consolidation, sale or
acquisition with respect to a Participating Company, the Administrative
Committee may determine, without necessity of a Plan amendment, to credit
employees of any entity affected by such merger, consolidation, sale or
acquisition, for vesting purposes, with past service; provided, such
determination shall be made only if there is a valid business purpose, the
determination is reasonable in light of the circumstances, and
nondiscriminatory, all within the meaning of Code Section 401(a)(4) and the
regulations thereunder. The Administrative Committee shall adopt an Appendix 1
to the Adoption Agreement to provide to the Master Plan Sponsor the information
necessary to credit such past service.
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ARTICLE III
ELIGIBILITY
3.1 Initial Eligibility Requirements.
(a) General Rule. Except as provided in subsections (b) and (c)
hereof, every Covered Employee shall become an Active Participant in the Plan
on the Entry Date coinciding with or next following the date on which he meets
the eligibility conditions set forth in Section 3.1 of the Adoption Agreement,
provided he is a Covered Employee on such date.
(b) Participation Upon Effective Date. Each Covered Employee
who, on or before the Effective Date, has met the eligibility conditions set
forth in Section 3.1 of the Adoption Agreement shall become an Active
Participant in the Plan on the Effective Date, provided he is a Covered
Employee on such date.
(c) Grandfathered Participants. Each Covered Employee who is an
active participant in a Prior Plan on the day immediately preceding the date as
of which the Plan replaces the Prior Plan shall continue as an Active
Participant in accordance with the terms of the Plan.
3.2 Treatment of Interruptions of Service.
(a) Leave of Absence. If a Covered Employee satisfies the
eligibility requirements set forth in Section 3.1 of the Adoption Agreement but
is on a Leave of Absence on the Entry Date on which he otherwise would have
become an Active Participant, he shall become an Active Participant as of the
date he subsequently resumes the performance of duties as a Covered Employee in
accordance with the terms of his Leave of Absence.
(b) Reemployment Before Break in Service. If a Covered Employee
satisfies the eligibility requirements set forth in Section 3.1 of the Adoption
Agreement, separates from service with a Participating Company (and all other
Participating Companies) before the Entry Date on which he otherwise would
become an Active Participant, and then is reemployed by a Participating Company
prior to completing a Break in Service, he shall become an Active Participant
as of the later of (i) the Entry Date on which he otherwise would have become
an Active Participant if he had not separated from service or (ii) the date he
is reemployed as a Covered Employee.
(c) Reemployment After Break in Service. If a Covered Employee
satisfies the eligibility requirements set forth in Section 3.1 of the Adoption
Agreement, separates from service with a Participating Company (and all other
Participating Companies) before the Entry Date on which he otherwise would
become an Active Participant, and then is reemployed as a Covered Employee by a
Participating Company after completing a Break in Service, he shall become an
Active Participant as of the Entry Date coinciding with or next following the
date he satisfies the eligibility requirements set forth in Section 3.1 of the
Adoption Agreement after his reemployment following the last such Break in
Service.
(d) Reparticipation Upon Reemployment. If an Active Participant
separates from service with a Participating Company (and all other
Participating Companies), his active participation in the Plan shall cease
immediately, and he again shall become an Active Participant as of the day he
again becomes a Covered Employee. However, regardless of whether he again
becomes an Active Participant, he shall continue to be a Participant until he
no longer has an Account under the Plan.
3.3 Change in Status.
(a) Loss of Covered Employee Status. If a Covered Employee (i)
satisfies the eligibility requirements set forth in Section 3.1 of the Adoption
Agreement, (ii) changes his employment status (but remains employed) so that he
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<PAGE> 32
ceases to be a Covered Employee before the Entry Date on which he otherwise
would become an Active Participant, and (iii) then again changes his employment
status and becomes a Covered Employee prior to completing a Break in Service,
he shall become an Active Participant as of the later of (A) the Entry Date on
which he otherwise would have become an Active Participant if he had not ceased
to be a Covered Employee or (B) the date he again becomes a Covered Employee.
If an Employee covered by this Section does complete a Break in Service prior
to again becoming a Covered Employee, his entry to participation in the Plan
will be governed by Section 3.2(c).
(b) Change to Covered Employee Status. If an Employee who first
satisfies the eligibility requirements of Section 3.1 of the Adoption Agreement
while he is not a Covered Employee subsequently changes his employment status
so that he becomes a Covered Employee, he shall become an Active Participant on
the Entry Date coinciding with or next following his change in status. If, on
such date, he has not satisfied the eligibility requirements of Section 3.1 of
the Adoption Agreement or is not a Covered Employee, he shall become an Active
Participant on the Entry Date coinciding with or next following the date he
satisfies the eligibility requirements of Section 3.1 of the Adoption
Agreement; provided, he is a Covered Employee on such Entry Date.
(c) Change by Participant. If an Active Participant changes his
status of employment (but remains employed) so that he is no longer a Covered
Employee, his active participation in the Plan shall cease immediately, and he
shall again become an Active Participant in the Plan as of the day he again
becomes a Covered Employee. However, regardless of whether he again becomes an
Active Participant, he shall continue to be a Participant until he no longer
has an Account under the Plan.
3.4 Notification of Participation.
Each Covered Employee shall be notified when he becomes eligible
to become an Active Participant and, at such time, shall be furnished with (i)
a summary of the Plan, (ii) a Before Tax and/or After Tax Deferral Election (if
the Adopting Company elects a Section 401(k), cash-or-deferred arrangement
pursuant to Section 4.1 of the Adoption Agreement) and (iii) a Beneficiary
Designation Form.
3.5 Provisions of Plan Binding on Participants.
Upon becoming a Participant, a Participant shall be bound then
and thereafter by the terms of the Plan, including all amendments to the Master
Plan, the Adoption Agreement and any applicable Joinder Agreement and, if
applicable, by the provisions of his Deferral Elections.
3.6 Companies in Controlled Groups.
Notwithstanding any other provision of the Plan or of any
Adoption Agreement, no Adopting Company may adopt or maintain a Plan if such
Adopting Company's Plan would not satisfy Code Section Section 401, 410, 411
and 415 when all employees of the Adopting Company and its Affiliates are
treated as employed by the Adopting Company.
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ARTICLE IV
CONTRIBUTIONS
4.1 General.
If and to the extent an Adopting Company elects pursuant to its
Adoption Agreement to make, or to permit the Active Participants of the Plan to
make, any or all of the Contributions described in this Article IV, the
provisions of this Article IV pertaining to such Contributions shall apply.
4.2 Before Tax and After Tax Contributions.
If the Adopting Company elects a Section 401(k), cash-or-deferred
arrangement pursuant to Section 4.1 of the Adoption Agreement, the provisions
of this Section 4.2 shall apply.
(a) Before Tax Contributions. Each Participating Company shall
contribute to the Plan, on behalf of each Active Participant employed by such
Participating Company and for each payroll period (including any period during
which a bonus or other special Compensation is paid or payable as part of the
regular payroll check and not as a separate bonus or special check) for which
such Active Participant has a Before Tax Deferral Election in effect with such
Participating Company, a Before Tax Contribution in an amount equal to the
amount by which such Active Participant's Compensation has been reduced for
such period pursuant to his Before Tax Deferral Election. The amount of the
Before Tax Contribution shall be determined in increments of 1 percent of such
Active Participant's Compensation for each payroll period. The Active
Participant may elect to reduce his Compensation for any period by a minimum of
1 percent and a maximum percent (not in excess of 16 percent), as elected in
Section 4.2 of the Adoption Agreement; provided, the maximum limitations in
Article VII shall apply.
(b) After Tax Contributions. If elected by the Adopting Company
pursuant to Section 4.3(a) of the Adoption Agreement, Active Participants shall
be permitted to make After Tax Contributions, and the provisions of this
subsection (b) and subsections (c) and (d) hereof shall apply.
(1) Contributions Through Deferral Election. Each
Participating Company shall contribute to the Plan, on behalf of each
Active Participant employed by such Participating Company and for each
payroll period (including any period during which a bonus or other
special Compensation is paid or payable as part of the regular payroll
check and not as a separate bonus or special check) for which such Active
Participant has an After Tax Deferral Election in effect with such
Participating Company, an After Tax Contribution in an amount equal to
the amount by which such Active Participant's Compensation has been
reduced for such payroll period pursuant to such After Tax Deferral
Election. The amount of such After Tax Contribution shall be determined
in increments of 1 percent of such Active Participant's Compensation for
each payroll period. The Active Participant may elect to reduce his
Compensation for any period by a minimum of 1 percent and a maximum
percent (not in excess of 10 percent), as elected in Section 4.3(b) of
the Adoption Agreement; provided, the total of Before Tax and After Tax
Contributions shall not exceed 16 percent of Compensation and the maximum
limitations in Article VII shall apply.
(2) Contributions Paid by Participant. In lieu of making
After Tax Contributions through payroll withholding, as described in
subsection (1) hereof, a Participant may pay to the Trustee, in cash or
cash equivalent, an amount designated as an "After Tax Contribution".
The Administrative Committee, in its sole discretion, may allow direct
After Tax Contributions and prescribe such nondiscriminatory terms and
conditions governing direct After Tax Contributions as it deems
appropriate.
(c) Contributions Which Exceed Maximum Deferral Amount. To the
extent that the amount of an Active Participant's Before Tax Contributions made
for a calendar year pursuant to such Active Participant's Before
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<PAGE> 34
Tax Deferral Election would exceed the Maximum Deferral Amount if such Before
Tax Contributions are continued, those Before Tax Contributions in all respects
will be deemed to be After Tax Contributions (if After Tax Contributions are
allowed under the Plan as elected by the Adopting Company pursuant to Section
4.3 of the Adoption Agreement) and will be treated as if such Active
Participant elected to make such After Tax Contributions in accordance with the
terms of subsection (b) hereof; provided, the maximum aggregate percentage of
Compensation which may be contributed for any payroll period as After Tax
Contributions pursuant to the terms of this subsection and subsection (b)
hereof is the lesser of (i) the total of the percentage elected under the
Before Tax Deferral Election and any concurrently effective After Tax Deferral
Election and (ii) 10 percent. If After Tax Contributions are not elected by
the Adopting Company pursuant to Section 4.3 of the Adoption Agreement, Before
Tax Contributions which would exceed the Maximum Deferral Amount shall be
distributed to the Participant, as provided in Article VII.
(d) Deferral Elections. Each Active Participant, who desires
that his Participating Company make a Before Tax and/or After Tax Contribution
on his behalf, shall complete and deliver to the Participating Company (or its
designee) a Before Tax Deferral Election and/or an After Tax Deferral Election,
respectively. Such Deferral Election shall provide for the reduction of his
Compensation for each payroll period (including any period during which a bonus
or other special Compensation is paid or payable as part of the regular payroll
check and not as a separate bonus or special check) ending or occurring while
he is an Active Participant employed by such Participating Company. The
Administrative Committee, in its sole discretion, shall prescribe the form of
all Deferral Elections and may prescribe such nondiscriminatory terms and
conditions governing the use of the Deferral Elections as it deems appropriate.
In particular, the Administrative Committee may waive any requirement that
elections be in written form in order to accommodate electronic or automated
systems and interfaces. Subject to any modifications, additions or exceptions
which the Administrative Committee, in its sole discretion, deems necessary,
appropriate or helpful, the following terms shall apply to Deferral Elections:
(1) Effective Date. An Active Participant's initial
Deferral Election with a Participating Company shall be effective for the
first payroll period which ends after the Deferral Election is made and
after the effective date of such Deferral Election. If an Active
Participant fails to submit a Deferral Election in a timely manner, he
shall be deemed to have elected a deferral of zero percent. For purposes
of this subsection, the "effective date" of a Deferral Election shall
mean: (A) for a Participant who commences participation in the Plan on
an Entry Date, that Entry Date; and (B) for a Participant who commences
or recommences participation in the Plan on a date other than an Entry
Date, the Entry Date next following the Participant's commencement of
participation in the Plan.
(2) Term. Each Active Participant's Deferral Election
with a Participating Company shall remain in effect in accordance with
its original terms until the earlier of (A) the date the Active
Participant ceases to be a Covered Employee of all Participating
Companies, (B) the date the Active Participant revokes such Deferral
Election pursuant to the terms of subsection (d)(3) hereof, or (C) the
date the Active Participant or the Administrative Committee modifies such
Deferral Election pursuant to the terms of subsection (d)(4) or (d)(5)
hereof. If a Participant is transferred from the employment of a
Participating Company to the employment of another Participating Company,
his Deferral Election with the first Participating Company will remain in
effect and will apply to his Compensation from the second Participating
Company until the earlier of (A), (B) or (C) of the preceding sentence.
(3) Revocation. An Active Participant's Deferral Election
with a Participating Company shall terminate upon his ceasing to be a
Covered Employee of such Participating Company. In addition, an Active
Participant may revoke his Before Tax and/or After Tax Deferral Election
with a Participating Company by delivering a written notice of revocation
to such Participating Company (or its designee), and such revocation
shall be effective as soon as practicable after the date on which it is
received by such Participating Company. An Active Participant who
revokes a Before Tax or After Tax Deferral Election may enter into a new
Deferral Election, effective for the first payroll period which ends
after both the new Deferral Election is made and any regular Valuation
Date occurs (unless the general rules of the Administrative Committee
prescribe a later date), by delivering the new Deferral Election to his
Participating Company (or its designee) at least 30 days (or such
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lesser period as the Administrative Committee may permit) before such
Valuation Date (or later prescribed date); provided, no such new Deferral
Election shall be effective prior to the end of the 6-month period
beginning on the effective date of the revocation of such Participant's
prior Deferral Election, or such lessor time as the Administrative
Committee may allow pursuant to written procedures.
(4) Modification by Participant. Effective for the first
payroll period which ends after both a new Deferral Election is made and
any regular Valuation Date (or other date prescribed by the
Administrative Committee) occurs, an Active Participant may modify any of
his existing Deferral Elections to increase or decrease the percentage of
his Before Tax or After Tax Contributions by delivering the new Deferral
Election to his Participating Company (or its designee) at least 30 days
(or such lesser period as the Administrative Committee may permit) before
such Valuation Date.
(5) Modification by Administrative Committee.
Notwithstanding anything herein to the contrary, the Administrative
Committee may modify any Deferral Election of any Active Participant at
any time by decreasing the percentage of any Before Tax or After Tax
Contributions to the extent the Administrative Committee deems necessary
to comply with the limitations described in Article VII.
(6) Special Bonus Election. If elected by the Adopting
Company pursuant to Section 4.4 of the Adoption Agreement and to the
extent permitted by the Administrative Committee on a nondiscriminatory
basis, an Active Participant may complete and deliver to his
Participating Company (or its designee) a Special Bonus Election with
respect to a particular bonus. The terms of such Special Bonus Election
generally shall be determined by reference to the foregoing provisions of
this subsection (d); provided, the following modifications shall apply:
(i) The Active Participant shall deliver the Special
Bonus Election at least 20 days (or such lesser period as the
Administrative Committee may permit) prior to the date on which
the bonus becomes payable, and in no event later than the time at
which such bonus becomes payable;
(ii) Such Special Bonus Election shall be effective,
if at all, only for the bonus next payable and shall supersede
any previously filed Deferral Election which otherwise would
apply to such bonus;
(iii) Subject to the limitations in Article VII, such
Special Bonus Election shall provide for the reduction of such
bonus in a dollar amount or percentage specified by the Active
Participant, but in no event shall such reduction be less than
$50;
(iv) The Active Participant may elect to reduce his
bonus up to 100 percent; and
(v) Such Special Bonus Election shall terminate at
the earlier of (A) the time immediately after the bonus to which
it relates becomes payable or (B) the occurrence of one of the
events enumerated in subsection (d)(2) hereof.
4.3 Matching Contributions.
(a) General. For each Active Participant on whose behalf a
Participating Company has made any Before Tax Contributions, such Participating
Company shall make a Matching Contribution equal to the amount determined
pursuant to Section 4.5 of the Adoption Agreement; provided, Matching
Contributions shall be made on a payroll-by-payroll basis or on a Plan Year
basis, as designated in Section 4.5(b)(3) of the Adoption Agreement; and,
provided further, the total amount of the Matching Contributions which a
Participating Company shall make for any Active Participant shall not exceed
the maximum limits set forth in Section 4.5(b) of the Adoption Agreement, nor
shall such amount exceed (or cause Company Contributions to exceed) any of the
maximum limitations described in Article VII.
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(b) Additional Matching Contributions. If elected pursuant to
Section 4.6 of the Adoption Agreement and the total Matching Contributions to a
Participant's Account for a Plan Year are less than the product of (i) the
amount with which the Adopting Company elects to match each dollar of Before
Tax Contributions in Section 4.5 of the Adoption Agreement, multiplied by (ii)
the lesser of (A) the total Before Tax Contributions to a Participant's Account
in such Plan Year and (B) the maximum percentage of a Participant's
Compensation (expressed in terms of dollars) that the Adopting Company elects
to match in Section 4.5 of the Adoption Agreement, the Participating Company
shall make an additional Matching Contribution to the Participant's Account in
the amount, if any, by which the product of (i) and (ii) above, exceeds the
total Matching Contributions to such Participant's Account for such Plan Year.
The Participating Company shall make the additional Matching Contribution
pursuant to this subsection as of the last day of such Plan Year. The purpose
of such additional Matching Contribution is to ensure that Participants who
change their rate of Before Tax Contributions to the Plan during a Plan Year
shall receive a Matching Contribution to their Accounts based on their total
Before Tax Contributions during such Plan Year.
(c) Reduction of Forfeitures. If the Participating Companies are
required to make Matching Contributions for a Plan Year pursuant to Section
4.5 of the Adoption Agreement, and if the Adopting Company so elects under
Section 4.8(b) of the Adoption Agreement, or as determined by the Administrative
Committee for the Plan Year, if elected under Section 4.8(d) of the Adoption
Agreement, the Participating Companies' Matching Contributions for a Plan Year
shall be reduced by the amount of any Forfeitures available for reallocation
during that Plan Year. For purposes hereof, the amount of available
Forfeitures shall refer to the amount of Forfeitures not otherwise used to make
Restoration Contributions or Supplemental Contributions for such Plan Year. If
Forfeiture amounts remain after paying all Matching, Restoration and
Supplemental Contributions, the Forfeitures shall be allocated, by the
Administrative Committee, at the direction of the Board, (i) to reduce Profit
Sharing Contributions required by the Participating Companies for the Plan
Year, pursuant to Section 4.5(b) hereof, (ii) to reduce Matching
Contributions for the following Plan Year or (iii) to be reallocated pursuant
to Section 4.10 of the Plan. Except as elected in the Adoption Agreement,
this Section shall not require the Participating Companies to make a Matching
Contribution in any Plan Year.
4.4 Supplemental Contributions.
If the Adopting Company elects to include a Code Section 401(k),
cash-or-deferred feature in the Plan in Section 4.1 of the Adoption Agreement,
then in addition to the Before Tax Contributions made pursuant to Section 4.1
of the Adoption Agreement, the Participating Companies may, but shall not be
required to, contribute to the Plan, for each Plan Year, a Supplemental
Contribution (designated as such) in an amount, if any, as determined by the
Board. Any such Supplemental Contribution shall be subject to the requirements
and limitations set forth in Article VII.
4.5 Profit Sharing Contributions.
(a) General. If the Adopting Company elects to include Profit
Sharing Contributions as a feature of the Plan pursuant to Section 4.7 of the
Adoption Agreement, each Participating Company shall contribute to the Plan,
for each Plan Year, a Profit Sharing Contribution (designated as such) in the
amount, or determined under the method, elected by the Adopting Company in
Section 4.7 of the Adoption Agreement.
(b) Reduction of Forfeitures. If the Participating Companies
are required to make Profit Sharing Contributions for a Plan Year pursuant to
Section 4.7 of the Adoption Agreement, and if the Adopting Company so elects
under Section 4.8(c) of the Adoption Agreement, or as determined by the
Administrative Committee for the Plan Year, if elected under Section 4.8(d) of
the Adoption Agreement, the Participating Companies' Profit Sharing
Contributions for a Plan Year shall be reduced by the amount of any Forfeitures
available for reallocation during that Plan Year. For purposes hereof, the
amount of available Forfeitures shall refer to the amount of Forfeitures not
otherwise used to make Restoration Contributions or Supplemental Contributions
for such Plan Year. If Forfeiture amounts remain after paying all Profit
Sharing, Restoration and Supplemental Contributions, the Forfeitures shall be
allocated, by the Administrative Committee, at the direction of the Board, (i)
to reduce Profit Sharing Contributions required by the Participating Companies
for the following Plan Year, (ii) to reduce Matching Contributions for the Plan
Year pursuant
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to Section 4.3(c) hereof, or (iii) to be reallocated pursuant to Section 4.10
of the Plan. Except as elected in the Adoption Agreement, this Section shall
not require the Participating Companies to make a Profit Sharing Contribution
in any Plan Year.
4.6 Form of Contributions.
(a) General. Except as provided in subsection (b) hereof, all
Contributions shall be paid to the Trustee in the form of cash, cash equivalent
or marketable securities acceptable to the Trustee.
(b) Company Stock. If the Adopting Company elects in Section
8.2 of the Adoption Agreement to permit the investment of Plan assets in
Company Stock, Contributions may be made to the Company Stock Trustee (and not
the Master Trustee) in whole or in part in the form of Company Stock, as the
Administrative Committee may determine; provided, in no event shall Before Tax
or After Tax Contributions be made in the form of Company Stock.
4.7 Timing of Contributions.
(a) Before Tax and After Tax Contributions. Each Participating
Company that withholds Before Tax and/or After Tax Contributions from an Active
Participant's paycheck pursuant to a Deferral Election shall pay such Before
Tax and/or After Tax Contributions to the Trustee as of the earliest date (not
to exceed 90 days from the date on which such amounts otherwise would have been
payable to such Active Participant in cash) on which such Contributions can
reasonably be segregated from the Participating Company's general assets.
(b) Matching, Supplemental and Profit Sharing Contributions.
Each Participating Company shall pay its Matching, Supplemental and Profit
Sharing Contributions, if any, to the Trustee (i) on or before the date for
filing its federal income tax return (including extensions thereof) for the tax
year to which such Contributions relate, or (ii) on or before such other date
as shall be within the time allowed to permit the Participating Company to
properly deduct, for federal income tax purposes and for the tax year of the
Participating Company in which the obligation to make such Contributions was
incurred, the full amount of such Contributions; provided, in the event the
amount of Supplemental Contributions cannot be calculated by the latest date
described hereinabove, such Supplemental Contributions may be made at a later
date which is on or before the last day of the Plan Year following the Plan
Year to which such Supplemental Contributions relate.
4.8 Contingent Nature of Company Contributions.
Notwithstanding anything to the contrary herein and subject to
the terms of Section 16.11, each Company Contribution made to the Plan by a
Participating Company is made expressly contingent upon the deductibility
thereof for federal income tax purposes for the taxable year of the
Participating Company with respect to which such Company Contribution is made.
4.9 Restoration Contributions.
(a) Restoration Upon Buy-Back. If a Participant who is not 100
percent vested in his Account has received a distribution of his entire vested
Account in a manner described in Section 9.3(a) [such that he forfeits the
nonvested portion of his Account in accordance with the terms of Section
9.3(a)], and such Participant subsequently is rehired as a Covered Employee
prior to the occurrence of 5 consecutive Breaks in Service, that individual
may, prior to the earlier of (i) 5 years after the first date on which he is
rehired or (ii) the close of the first period of 5 consecutive Breaks in
Service commencing after the distribution, repay the full amount of the
distribution to the Trustee (unadjusted for gains or losses). Upon such
repayment, his Account will be credited with (i) all of the benefits
(unadjusted for gains or losses) which were forfeited, and (ii) the amount of
the repayment.
(b) Restoration of Other Forfeitures. If a Participant has
forfeited the nonvested amount in his Account in accordance with Section 9.3(b)
or Section 9.3(c), and such Participant subsequently is rehired as a Covered
Employee
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<PAGE> 38
prior to the occurrence of 5 consecutive Breaks in Service, his Account shall
be credited with all of the benefits (unadjusted for gains or losses) which
were forfeited, as determined pursuant to the terms of Section 9.3(b) or
Section 9.3(c), respectively.
(c) Restoration Contribution. The assets necessary to fund the
Account of the rehired individual (in excess of the amount of the repayment, if
any) shall be provided no later than as of the end of the Plan Year following
the Plan Year in which repayment occurs (if subsection (a) hereof applies) or
in which the individual is rehired (if subsection (b) hereof applies), and
shall be provided in the discretion of the Administrative Committee from (i)
income or gain to the Trust Fund, (ii) Forfeitures arising from the Accounts of
Participants employed or formerly employed by the Participating Companies, or
(iii) Contributions made by the Participating Companies. If Restoration
Contributions are made by Participating Companies and unless the Administrative
Committee designates a different manner for dividing such Contributions, each
Participating Company's portion of these Contributions shall be equal to the
product of (i) the amount of the Restoration Contributions, and (ii) a
fraction, the numerator of which is the amount of Contributions made by such
Participating Company for the Plan Year in which the Restoration Contributions
are made, and the denominator of which is the total amount of all Contributions
made by all Participating Companies for such Plan Year.
(d) Notice of Buy-Back Rights. It shall be the duty of the
Administrative Committee to give timely notification to any rehired individual
who is eligible to make a repayment of his right to make such representation in
accordance with this Section and of the consequences of not making such
repayment; namely that the nonvested portion of the benefits accrued under the
Plan during his previous employment will not be restored by the Plan, will
remain forfeited, and will not be become vested even though he may perform
additional Years of Vesting Service.
4.10 Allocation of Forfeitures. If the Adopting Company so elects
under Section 4.8(a) of the Adoption Agreement, or as determined by the
Administrative Committee for the Plan Year, if elected under Section 4.8(d) of
the Adoption Agreement, Forfeitures that remain after paying all Restoration
and Supplemental Contributions for the Plan Year shall be allocated, by the
Administrative Committee, at the direction of the Board, either (i) pursuant to
Section 6.4 [but only if Profit Sharing Contributions are included in the Plan
(see Section 4.5)], or (ii) as additional Matching Contributions allocated in
proportion to the amount of each eligible Participant's Before Tax
Contributions generally taken into account for Matching Contribution purposes.
See also Section 6.1 of the Adoption Agreement for a description of "eligible
Participant" for the purposes of allocating the excess Forfeitures. Except as
elected in the Adoption Agreement, this Section shall not require the
Participating Companies to make a Matching Contribution in any Plan Year.
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ARTICLE V.
ROLLOVERS AND TRANSFERS BETWEEN PLANS; VOLUNTARY ACCOUNTS
5.1 Rollover Contributions.
(a) Request by Covered Employee. A Covered Employee may make a
written request to the Administrative Committee that he be permitted to
contribute, or cause to be contributed, to the Trust Fund a Rollover
Contribution which is received by such Covered Employee or to which such
Covered Employee is entitled. Such written request shall contain information
concerning the type of property constituting the Rollover Contribution and a
statement, satisfactory to the Administrative Committee, that the property
constitutes a Rollover Contribution. If a Covered Employee who is not a
Participant makes a Rollover Contribution, the time and method of distribution
of such Covered Employee's Rollover Account shall be determined under the terms
of the Plan as if such Covered Employee were a Participant, but he shall not be
considered a Participant under the Plan for any other purpose.
(b) Acceptance of Rollover. Subject to the terms of the Plan
and the Code (including regulations and rulings promulgated thereunder), the
Administrative Committee, in its sole discretion, shall determine whether (and
if so, under what conditions and in what form) a Rollover Contribution shall be
accepted at any time by the Trustee. For example, the Administrative
Committee, in its sole discretion, may decide to allow Rollover Contributions
from Participants and/or direct Rollover Contributions from another qualified
retirement plan [as described in Code Section 401(a)(31)]. In the event the
Administrative Committee permits a Covered Employee to make a Rollover
Contribution, the amount of the Rollover Contribution shall be transferred to
the Trustee and allocated as of the next following Valuation Date to a Rollover
Account for such Covered Employee. Unless the Administrative Committee permits
otherwise, all Rollover Contributions shall be made in cash.
5.2 Transfer Contributions.
(a) Direct Transfers Permitted. The Administrative Committee,
in its sole discretion, shall permit direct trustee-to-trustee transfers of
assets and liabilities to the Plan [which shall be distinguished from direct
Rollover Contributions as described in Code Section 401(a)(31)] as a Transfer
Contribution on behalf of an Active Participant. Unless requisite forms of
benefit are provided in the Plan or are otherwise permitted pursuant to any
Appendix 1 of the Adoption Agreement, a Transfer Contribution shall not be
accepted on behalf of an Active Participant if such Transfer Contribution is
from a retirement plan which, with respect to such Participant, (i) is subject
to the requirements of providing any alternative form of benefit not permitted
under the Plan, or (ii) if the Plan is not subject to Code Section 401(k) or
Section 401(m), but the transferring Prior Plan is subject to the requirements
of Code Section 401(k) or Section 401(m), respectively.
(b) Mergers and Spin-offs Permitted. The Administrative
Committee, in its sole discretion, shall permit other qualified retirement
plans to transfer assets and liabilities to the Plan as part of a merger,
spin-off or similar transaction. Any such transfer shall be made in accordance
with the terms of the Code and subject to such rules and requirements as the
Administrative Committee may deem appropriate. Without limitation, the
Administrative Committee shall determine the schedule under which Transfer
Contributions shall vest; provided no such schedule shall be less favorable to
affected Participants than the schedule elected by the Adopting Company
pursuant to Section 9.1 of the Adoption Agreement; and provided further, if
such schedule constitutes an amendment to the vesting schedule under the Prior
Plan, the terms of Section 9.4 of the Plan shall apply. Unless requisite forms
of benefit are provided under the Plan, a Transfer Contribution shall not be
accepted if (i) the transferring Prior Plan is subject to the requirements of
providing any alternative form of benefit not permitted under the Plan, or (ii)
if the Plan is not subject to Code Section 401(k) or Section 401(m), but the
transferring Prior Plan is subject to the requirements of Code Section 401(k)
or Section 401(m), respectively.
(c) Establishment of Transfer Accounts. As of the Valuation
Date immediately following the date the Trustee receives a Transfer
Contribution, there shall be credited to one or more Transfer Accounts of each
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Participant the total amount received from the respective accounts of such
Participant in the transferring qualified retirement plan. Any amounts so
credited as a result of any such merger or spin-off or other transfer shall be
subject to all of the terms and conditions of the Plan from and after the date
of such transfer.
5.3 Spin-offs to Other Plans.
The Administrative Committee, in its sole discretion, may cause
the Plan to transfer to another qualified retirement plan (as part of a
spin-off or similar transaction) assets and liabilities maintained under the
Plan. Any such transfer shall be made in accordance with the terms of the Code
and subject to such rules and requirements as the Administrative Committee may
deem appropriate. Upon the effectiveness of any such transfer, the Plan and
Trust shall have no further responsibility or liability with respect to the
transferred assets and liabilities.
5.4 Voluntary Accounts.
(a) Contributions Not Permitted. Participants may not make
Voluntary Contributions to the Plan. However, a separate Voluntary Account
shall be maintained for any Voluntary Contributions made to a Prior Plan and
shall be nonforfeitable at all times.
(b) Conditions on Accounts. The following conditions shall
apply to all Voluntary Contributions and Voluntary Accounts:
(1) No part of the Voluntary Account shall be used to
purchase life insurance.
(2) In the sole discretion of the Administrative
Committee, the Plan may accept accumulated deductible employee
contributions, as defined in Code Section 72(o)(5), that were distributed
from a qualified retirement plan and rolled over pursuant to Code Section
Section 402(a)(5), 402(a)(7), 403(a)(4) or 408(d)(3). The rolled over
amount will be added to the Voluntary Account.
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ARTICLE I
PARTICIPANTS' ACCOUNTS; CREDITING AND ALLOCATIONS
6.1 Establishment of Participants' Accounts.
To the extent appropriate, the Administrative Committee shall
establish and maintain, on behalf of each Participant and Beneficiary, an
Account which shall be divided into segregated subaccounts. The subaccounts
shall include Before Tax, After Tax, Matching, Supplemental, Profit Sharing,
Voluntary, Rollover and Transfer Accounts and such other subaccounts as the
Administrative Committee shall deem appropriate or helpful. Each Account shall
be credited with Contributions allocated to such Account and generally shall be
credited with income on investments derived from the assets of such Accounts.
Notwithstanding anything herein to the contrary, in the event that daily
Valuation Dates are elected in Section 2.1(d) of the Adoption Agreement, while
Contributions may be allocated to a Participant's Account as of a particular
date (as provided in the Plan), such Contributions shall actually be added to a
Participant's Account and shall be credited with investment experience only
from the date such Contributions are received and credited to the Participant's
Account by the Trustee. Each Account of a Participant or Beneficiary shall be
maintained until the value thereof has been distributed to or on behalf of such
Participant or Beneficiary.
6.2 Allocation and Crediting of Before Tax, After Tax, Matching,
Voluntary, Rollover and Transfer Contributions.
As of each Valuation Date coinciding with or immediately following
the date as of which Before Tax, After Tax, Matching, Voluntary, Rollover and
Transfer Contributions are received on behalf of an Active Participant, such
Contributions shall be allocated and credited directly to the appropriate
Before Tax, After Tax, Matching, Voluntary, Rollover and Transfer Accounts,
respectively, of such Active Participant; provided, if Matching Contributions
are to be made on a Plan Year basis as provided in Section 4.3(a) and Section
4.5(b)(3) of the Adoption Agreement, they shall be allocated and credited as of
the last day of each Plan Year to the Matching Account of each Participant who
made Before Tax Contributions for such Plan Year and (i) who is eligible to
receive an allocation pursuant to Section 6.1 of the Adoption Agreement or (ii)
who was not in the active employ of an Affiliate on the last day of such Plan
Year due to a Qualified Separation which occurred during the Plan Year..
6.3 Allocation and Crediting of Supplemental Contributions.
(a) Participants Receiving Allocations. Subject to Section
6.10, Supplemental Contributions shall be allocated and credited as of the last
day of each Plan Year to the Supplemental Account of each Participant who is
not a Highly Compensated Employee for such Plan Year and who is eligible to
receive such an allocation pursuant to Section 6.1 of the Adoption Agreement.
(b) Formula for Allocation. As of the last day of each Plan
Year for which Participating Companies make (or are deemed to have made)
Supplemental Contributions, each Participant who is eligible to receive an
allocation of Supplemental Contributions for such Plan Year shall have
allocated and credited to his Supplemental Account a portion of the
Supplemental Contributions made for such Plan Year. The Administrative
Committee shall cause a portion of such Contribution to be allocated to the
Account of each such Participant in accordance with the terms of subsection
(c), (d) or (e), whichever is applicable.
(c) Per Capita Supplemental Contributions. To the extent that
the Board and/or Administrative Committee designates all or any portion of the
Supplemental Contributions for a Plan Year as "Per Capita Supplemental
Contributions", such Contributions shall be allocated to the Supplemental
Accounts of all eligible Participants on a per capita basis (that is, the same
dollar amount shall be allocated to the Supplemental Account of each eligible
Participant).
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<PAGE> 42
(d) Proportional Supplemental Contributions. To the extent that
the Board and/or Administrative Committee designates all or any portion of the
Supplemental Contributions for a Plan Year as "Proportional Supplemental
Contributions", such Contributions shall be allocated to the Supplemental
Account of each eligible Participant in the same proportion that (i) the
Compensation of such eligible Participant for such Plan Year bears to (ii) the
total Compensation of all such eligible Participants for such Plan Year.
(e) Supplemental Matching Contributions. To the extent that the
Board and/or Administrative Committee designates all or any portion of the
Supplemental Contributions for a Plan Year as "Supplemental Matching
Contributions", such Contributions shall be allocated to the Supplemental
Account of each eligible Participant in the same proportion that (i) such
eligible Participant's Plan Year Before Tax Contributions that do not exceed
the maximum amount of Before Tax Contributions taken into account in
determining Matching Contributions for such Plan Year, bears to (ii) the total
of all such eligible Participants' Plan Year Before Tax Contributions
(calculated by taking into account for such eligible Participants only the
maximum amount of Before Tax Contributions taken into account in determining
Matching Contributions for such Plan Year).
(f) Section 415 Supplemental Contributions. To the extent that
the Board and/or Administrative Committee designates all or any portion of the
Supplemental Contributions for a Plan Year as "Section 415 Supplemental
Contributions", such Contributions shall be allocated to the Supplemental
Account of some or all eligible Participants, (A) beginning with such eligible
Participant(s) who have the lowest Compensation [within the meaning of "Testing
Compensation", as defined herein and designated by the Administrative Committee
for that Plan Year], until such eligible Participant(s) reach their annual
addition limits (as described in Section 7.7), or the amount of the
Supplemental Contributions is fully allocated, and then (B) continuing with
successive individuals or groups of such eligible Participants in the same
manner until the amount of the Section 415 Supplemental Contributions is fully
allocated.
6.4 Allocation and Crediting of Profit Sharing Contributions and
Excess Forfeitures.
(a) Participants Receiving Allocations. Subject to Section
6.10, Profit Sharing Contributions and any excess Forfeitures that are to be
allocated as Profit Sharing Contributions in accordance with the terms of
Section 4.5(b) shall be allocated and credited as of the last day of each Plan
Year to the Profit Sharing Account of each Participant (i) who is eligible to
receive such an allocation pursuant to Section 6.1 of the Adoption Agreement or
(ii) who was not in the active employ of an Affiliate on the last day of such
Plan Year due to a Qualified Separation which occurred during the Plan year;
provided, for any Plan Year that a Participating Company maintains another
qualified plan or simplified employee pension (within the meaning of Code
Section 408) (i) that covers an Active Participant who receives an allocation
under the Plan and (ii) that provides for or imputes limited disparity, the
allocation formula set forth in subsection (b)(i) hereof shall apply.
(b) Formula for Allocation. As of the last day of each Plan
Year for which Profit Sharing Contributions are made and/or excess Forfeitures
(as described in subsection (a) hereof) are available for allocation, each
Participant who is eligible to receive an allocation for such Plan Year
pursuant to subsection (a) hereof shall have allocated and credited to his
Profit Sharing Account the portion of such Contributions and/or excess
Forfeitures, as applicable, as is determined below:
(i) If elected pursuant to Section 6.2(a) of the Adoption
Agreement, an allocation in the same proportion that the Compensation of
such eligible Participant for such Plan Year bears to the total
Compensation of all Participants who are eligible to receive an
allocation of such Contributions or excess Forfeitures, as applicable,
for such Plan Year; or
(ii) If elected pursuant to Section 6.2(b) of the Adoption
Agreement, an allocation determined as follows:
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(A) An amount equal to the product of the
Integration Tax Rate multiplied by the total Excess Compensation
of such eligible Participants for such Plan Year shall be
allocated to the Profit Sharing Account of each such eligible
Participant in the same proportion that his Excess Compensation
for such Plan Year bears to the total Excess Compensation of all
such eligible Participants for such Plan Year; and
(B) The remainder of such Profit Sharing
Contributions and excess Forfeitures shall be allocated to the
Profit Sharing Account of each such eligible Participant in the
same proportion that the Compensation of such eligible Participant
for such Plan Year bears to the total Compensation of all such
eligible Participants for such Plan Year;
provided, in no event shall the amount of Profit Sharing Contributions
and excess Forfeitures allocated to each eligible Participant's Profit
Sharing Account pursuant to the terms of subsection (ii)(A) hereof
constitute a percentage of Excess Compensation which exceeds the
percentage of Compensation constituted by the amount of Profit Sharing
and excess Forfeitures allocated to each eligible Participant's Company
Contribution Account pursuant to the terms of subsection (ii)(B) hereof;
and the amount of Profit Sharing Contributions and Forfeitures allocated
pursuant to the terms of subsections (ii)(A) hereof shall be reduced and
reallocated pursuant to the terms of subsection (ii)(B) hereof to the
extent necessary to satisfy this maximum limitation. Effective for Plan
Years beginning on or after January 1, 1995, the cumulative permitted
disparity limit for a Participant is 35 Total Cumulative Permitted
Disparity Years. "Total Cumulative Permitted Disparity Years" means the
number of years credited to the Participant for allocation or accrual
purposes under this Plan, any other qualified plan or simplified employee
pension plan (whether or not terminated) ever maintained by an Affiliate.
For purposes of determining the Participant's cumulative permitted
disparity limit, all years ending in the same calendar year are treated
as the same year. If the Participant has not benefited under a defined
benefit or target benefit plan for any year beginning on or after January
1, 1994, the Participant has no cumulative disparity limit.
6.5 Crediting of Restoration Contributions.
As of each Valuation Date coinciding with or immediately following
the date on which a Restoration Contribution pursuant to Section 4.9 is
received from an Active Participant, such Contribution (together with the
nonvested benefits restored by the Plan as a result of such Contribution) shall
be credited to the appropriate Before Tax, After Tax, Matching, Voluntary,
Supplemental, Profit Sharing, Rollover and Transfer Accounts of the Active
Participant, in the amounts held by and distributed from such Accounts
immediately prior to the earlier distribution to such Participant.
6.6 Allocation and Crediting of Investment Earnings and Losses.
For purposes of this Section 6.6, each reference to "Trustee" and
"Trust Fund" shall be deemed a reference solely to the "Master Trustee" and the
"Master Trust Fund" respectively. For allocation of investment earnings and
losses under the Company Stock Trust Fund, see Section 6.11.
As of each Valuation Date, the Trustee shall determine the fair
market value of the Trust Fund, which shall be the sum of the fair market
values of each Investment Fund, as follows:
(a) Determination of Earnings. The investment earnings (or
losses) of each Investment Fund shall be the amount by which the sum determined
in (1) exceeds or (is less than) the sum determined in (2), where (1) and (2)
are as follows:
(1) the sum of (i) the fair market value of such
Investment Fund as of such Valuation Date, plus (ii) the amount of
distributions of and withdrawals from Accounts (including any hardship
withdrawals) since the immediately preceding Valuation Date made from
amounts invested in such Investment Fund, as determined
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under subsection (d) hereof, plus (iii) the amount of other disbursements
from such Investment Fund since the immediately preceding Valuation Date;
and
(2) the sum of (i) the fair market value of such
Investment Fund as of the immediately preceding Valuation Date, and (ii)
Contributions invested in such Investment Fund since the immediately
preceding Valuation Date.
(b) Allocation of Earnings. Investment earnings initially shall
be allocated in accordance with Section 4.9(c). As of each Valuation Date, each
Participant's Account shall be credited with such remaining earnings or debited
with such loss of each Investment Fund, as determined under subsection (a)
hereof, in the proportion that the amount credited to an Account that was
invested in such Investment Fund as of the immediately preceding Valuation Date
(adjusted pursuant to subsections (c) and (d) below) bears to the total amount
invested in such Investment Fund as of such Valuation Date (adjusted pursuant
to subsections (c) and (d) hereof).
(c) Increase for Contributions. Solely for determining a
Participant's share of the investment earnings (or losses) of each Investment
Fund as of each Valuation Date, a Participant's Accounts shall be credited with
one-half of the Before Tax, After Tax and Matching Contributions made to such
Accounts since the immediately preceding Valuation Date. Such amount to be
credited shall be allocated among the Investment Funds (if more than one)
according to such Participant's election, which was in effect as of the
Valuation Date on which such investment earnings (or losses) are being
allocated, for the allocation of future contributions among the Investment
Funds pursuant to Section 8.3; provided, if a Participant has not made or is
not permitted to make such election, the amount to be credited hereunder shall
be allocated among the Investment Funds in the same proportion that such
Participant's Account was allocated among the Investment Funds as of such
Valuation Date.
(d) Reduction for Distributions and Withdrawals. Solely for
determining a Participant's share of the investment earnings (or losses) of
each Investment Fund as of each Valuation Date, each Account of a Participant
shall be reduced by the amount of distributions and withdrawals from such
Account since the preceding Valuation Date.
6.7 Notice to Participants of Account Balances.
At least once for each Plan Year, the Administrative Committee
shall cause a written statement of a Participant's Account balance to be
distributed to the Participant.
6.8 Good Faith Valuation Binding.
In determining the value of the Trust Fund and the Accounts, the
Trustee and the Administrative Committee shall exercise their best judgment,
and all such determinations of value (in the absence of bad faith) shall be
binding upon all Participants and Beneficiaries.
6.9 Errors and Omissions in Accounts.
If an error or omission is discovered in the Account of a
Participant or Beneficiary, the Administrative Committee shall cause
appropriate, equitable adjustments to be made as of the Valuation Date
coinciding with or immediately following the discovery of such error or
omission.
6.10 Participants Eligible for Allocations.
Notwithstanding anything to the contrary contained herein or in
any Adoption Agreement, if any Active Participants are not eligible for
allocations under Section 6.3 or Section 6.4 due to a failure of such
Participants to meet the criteria set forth in Section 6.1 of the Adoption
Agreement, such Active Participants shall be eligible for allocations under
Section 6.3 and Section 6.4 if (but only if) they completed more than 500 Hours
of Service during the Plan Year or were employed by a
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<PAGE> 45
Participating Company on the last day of the Plan Year, and including them in
the allocations for the Plan Year is necessary to enable the Plan to comply
with the nondiscrimination requirements of the Code [including Code Section
410(b) or Section 401(a)(4)].
6.11 Allocations and Crediting of Investment Earnings and Losses in
Company Stock Trust Fund.
As of each Valuation Date, the Company Stock Trustee shall
determine the fair market value of the Company Stock Trust Fund as follows:
(a) Determination of Earnings. The investment earnings (or
losses) of the Company Stock Trust Fund shall be the amount by which the sum
determined in (1) exceeds or (is less than) the sum determined in (2), where
(1) and (2) are as follows:
(1) the sum of (i) the fair market value of Company Stock
in the Company Stock Trust Fund as of such Valuation Date, plus (ii) the
amount of distributions of and withdrawals from Accounts (including any
hardship withdrawals) since the immediately preceding Valuation Date made
from amounts invested in such Company Stock Trust Fund, as determined
under subsection (d) hereof, plus (iii) the amount of other disbursements
from such Company Stock Trust Fund since the immediately preceding
Valuation Date; and
(2) the sum of (i) the fair market value of such Company
Stock Trust Fund as of the immediately preceding Valuation Date, and (ii)
Contributions invested in such Company Stock Trust Fund since the
immediately preceding Valuation Date.
(b) Allocation of Earnings. Investment earnings initially shall
be allocated in accordance with Section 4.9(c). As of each Valuation Date,
each Participant's Account shall be credited with such remaining earnings or
debited with such loss of the Company Stock Trust Fund, as determined under
subsection (a) hereof, in the proportion that the amount credited to such
Account that was invested in such Company Stock Trust Fund as of the
immediately preceding Valuation Date (adjusted pursuant to subsections (c) and
(d) below) bears to the total amount invested in such Company Stock Trust Fund
by all participants as of such Valuation Date (adjusted pursuant to subsections
(c) and (d) below).
(c) Increase for Contributions. Solely for determining a
Participant's share of the investment earnings (or losses) of the Company Stock
Trust Fund as of each Valuation Date, a Participant's Accounts shall be
credited with one-half of any Before Tax, After Tax and Matching Contributions
made to such Accounts since the immediately preceding Valuation Date. Such
amount to be credited shall be allocated among the Company Stock Trust Fund and
the other Investment Funds offered under Section 8.2 according to such
Participant's election, which was in effect as of the Valuation Date on which
such investment earnings (or losses) are being allocated, for the allocation of
future contributions among the Company Stock Trust Fund and the Investment
Funds pursuant to Section 8.2; provided, if a Participant has not made or is
not permitted to make such election, the amount to be credited hereunder shall
be allocated among the Company Stock Trust Fund and the Investment Funds in the
same proportion that such Participant's Account was allocated among the Company
Stock Trust Fund and the Investment Funds as of such Valuation Date.
(d) Reduction for Distributions and Withdrawals. Solely for
determining a Participant's share of the investment earnings (or losses) of the
Company Stock Trust Fund as of each Valuation Date, each Account of a
Participant shall be reduced by the amount of distributions and withdrawals
from such Account since the preceding Valuation Date.
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ARTICLE VII
CONTRIBUTION AND SECTION 415 LIMITATIONS
AND NONDISCRIMINATION REQUIREMENTS
7.1 Profit and Deductibility Limitations.
The total Company Contribution amounts for any taxable year of the
Adopting Company and its Affiliates shall not exceed (i) if elected by the
Adopting Company pursuant to Section 7.1 of the Adoption Agreement, the total
accumulated or current Net Profits of the Adopting Company and its Affiliates
for their fiscal year to which such Contributions relate, or (ii) that amount
which is properly deductible for federal income tax purposes under the then
appropriate provisions of the Code. Generally, the maximum, tax-deductible
Company Contribution amounts for any taxable year of a Participating Company
shall be equal to 15 percent of the total Compensation paid or accrued during
such taxable year to all Participants employed by such Participating Company;
provided, no Company Contribution shall be deductible if it shall cause the
Plan to exceed the applicable maximum allocation limitations under Code Section
415, as described in Section 7.7. For purposes of this Section, a Company
Contribution may be deemed made by a Participating Company for a taxable year
if it is paid to the Trustee on or before the date of filing the Participating
Company's federal income tax return (including extensions thereof) for that
year or on or before such other date as shall be within the time allowed to
permit proper deduction by the Participating Company of the amount so
contributed for federal income tax purposes for the year in which the
obligation to make such Company Contribution was incurred.
7.2 Maximum Limitation on Elective Deferrals by Participating
Companies.
(a) Maximum Elective Deferrals Under Participating Company
Plans. The aggregate amount of a Participant's Elective Deferrals made for any
calendar year under the Plan and any other plans, contracts or arrangements
with the Participating Companies shall not exceed the Maximum Deferral Amount.
(b) Return of Excess Before Tax Contributions. If the aggregate
amount of a Participant's Before Tax Contributions made for any calendar year
by itself exceeds the Maximum Deferral Amount, [and, to the extent such Before
Tax Contributions were not treated as After Tax Contributions pursuant to
Section 4.2(c)], the Participant shall be determined to have notified the
Administrative Committee of such excess, and the Administrative Committee shall
cause the Trustee to distribute to such Participant, on or before April 15 of
the next succeeding calendar year, the total of (i) the amount by which such
Before Tax Contributions exceed the Maximum Deferral Amount, plus (ii) any
earnings allocable thereto. In addition, any Matching Contributions made on
behalf of the Participant which are attributable to the distributed Before Tax
Contributions shall be forfeited.
(c) Return of Excess Elective Deferrals Provided by Other
Participating Company Arrangements. If, after the reduction described in
subsection (b) hereof, a Participant's aggregate Elective Deferrals under
plans, contracts and arrangements with Participating Companies still exceed the
Maximum Deferral Amount, then, the Participant shall have been deemed to have
notified the Administrative Committee of such excess, and, unless the
Administrative Committee directs otherwise, such excess shall be reduced by
distributing to the Participant Elective Deferrals that were made for the
calendar year under plans, contracts and/or arrangements with Participating
Companies other than the Plan. However, if the Administrative Committee
decides to make any such distributions from Before Tax Contributions made to
the Plan, such distributions (including forfeiture of Matching Contributions)
shall be made in a manner similar to that described in subsection (b) hereof.
(d) Discretionary Return of Elective Deferrals. If after the
reduction described in subsections (b) and (c) hereof, (i) a Participant's
aggregate Elective Deferrals made for any calendar year under the Plan and any
other plans, contracts or arrangements with the Participating Companies and any
other employers still exceed the Maximum Deferral Amount, and (ii) such
Participant submits to the Administrative Committee, on or before the March 1
following the end of such calendar year, a written request that the
Administrative Committee distribute to such
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Participant all or a portion of his remaining Before Tax Contributions made for
such calendar year, and any earnings attributable thereto, then the
Administrative Committee may, but shall not be required to, cause the Trustee
to distribute such amount to such Participant on or before the following April
15. However, if the Administrative Committee decides to make any such
distributions from Before Tax Contributions made to the Plan, such
distributions (including forfeiture of Matching Contributions) shall be made in
a manner similar to that described in subsection (b) hereof.
(e) Return of Excess Annual Additions. Any Before Tax
Contributions returned to a Participant to correct excess Annual Additions
shall be disregarded for purposes of determining whether the Maximum Deferral
Amount has been exceeded.
7.3 Nondiscrimination Requirements for Before Tax Contributions.
(a) ADP Test. The annual allocation of the aggregate of all
Before Tax Contributions and, to the extent designated by the Administrative
Committee pursuant to subsection (c) hereof, Supplemental Contributions shall
satisfy at least one of the following ADP Tests for each Plan Year:
(1) The ADP for the Highly Compensated Employees who are
Active Participants shall not exceed the product of (A) the ADP for the
Active Participants who are not Highly Compensated Employees, multiplied
by (B) 1.25; or
(2) The ADP for the Highly Compensated Employees who are
Active Participants shall not exceed the ADP for the Active Participants
who are not Highly Compensated Employees by more than 2 percentage
points, nor shall it exceed the product of (A) the ADP of the Active
Participants who are not Highly Compensated Employees, multiplied by (B)
2.
(b) Multiple Plans. If before tax, matching and/or supplemental
contributions are made to one or more other plans [other than employee stock
ownership plans as described in Code Section 4975(e)(7)] which, along with the
Plan, are considered as a single plan for purposes of Code Section 401(a)(4) or
Section 410(b), such plans shall be treated as one plan for purposes of this
Section, and the before tax and applicable matching and supplemental
contributions made to those other plans shall be combined with the Before Tax
and applicable Supplemental Contributions for purposes of performing the tests
described in subsection (a) hereof. In addition, the Administrative Committee
may elect to treat the Plan as a single plan along with the one or more other
plans [other than employee stock ownership plans as described in Code Section
4975(e)(7)] to which before tax, matching and/or supplemental contributions are
made for purposes of this Section; provided, the Plan and all of such other
plans also must be treated as a single plan for purposes of satisfying the
requirements of Code Section 401(a)(4) and Section 410(b) [other than the
requirements of Code Section 410(b)(2)(A)(ii)]. However, for Plan Years
beginning after December 31, 1989, plans may be aggregated for purposes of this
subsection only if they have the same plan year.
(c) Adjustments to Actual Deferral Percentages. In the event
that the initial allocation of the Before Tax and Supplemental Contributions
for a Plan Year does not satisfy one of the ADP Tests, the Administrative
Committee shall cause the Before Tax and Supplemental Contributions for such
Plan Year to be adjusted in accordance with one or a combination of the
following options:
(1) The Administrative Committee may cause the
Participating Companies to make, with respect to such Plan Year,
Supplemental Contributions on behalf of, and specifically allocable to,
the Active Participants described in Section 6.3(a) with respect to such
Plan Year, in the minimum amount necessary to satisfy one of the ADP
Tests. Such Supplemental Contributions shall be allocated among such
Active Participants in a manner consistent with Section 6.3.
(2) By the last day of the Plan Year following the Plan
Year in which the annual allocation failed both of the ADP Tests, the
Administrative Committee may direct the Trustee to reduce the Before Tax
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Contributions taken into account with respect to Highly Compensated
Employees under such failed ADP Tests by an amount necessary to satisfy
one of the ADP Tests. Any amount by which Before Tax Contributions are
so reduced, plus any earnings attributable thereto, shall be distributed
to the Highly Compensated Employees from whose Before Tax Accounts such
reductions shall have been made. Such reductions in Before Tax
Contributions shall be made in accordance with, and solely to the
Accounts of those Highly Compensated Employees who are affected by, the
following procedure:
(A) First, the Before Tax Contributions of the
Highly Compensated Employee(s) with the highest ADP for such Plan
Year shall be reduced by the lesser of (i) the entire amount
necessary to satisfy one of the ADP Tests, or (ii) that part of
the amount necessary to satisfy one of the ADP Tests as shall
cause the ADP of each such Highly Compensated Employee to equal
the ADP of each of the Highly Compensated Employees with the next
highest ADP for such Plan Year. In addition, to the extent that a
Highly Compensated Employee's Before Tax Contributions are reduced
pursuant to this Section, any Matching Contributions made on
behalf of a Highly Compensated Employee which are attributable to
the distributed Before Tax Contributions shall be forfeited.
(B) Substantially identical steps shall be followed
for making further reductions in the Before Tax Contributions of
each of the Highly Compensated Employees with the next highest ADP
for such Plan Year until one of the ADP Tests has been satisfied.
In reducing the Contributions of Highly Compensated Employees in
subsections (2)(A) and (B) hereof, the Administrative Committee shall
comply with the special "family member" rules contained in the proposed
regulations under Code Section 401(m).
(3) Failure to make such adjustments within two and
one-half months after the close of the Plan Year for which adjustments
are made may result in imposition of a 10% excise tax pursuant to Code
Section 4979.
7.4 Nondiscrimination Requirements for After Tax and Matching
Contributions.
(a) ACP Test. The amount of the aggregate of all After Tax and
Matching Contributions, and to the extent designated by the Administrative
Committee pursuant to subsection (c) hereof, Supplemental Contributions made
for each Plan Year, shall satisfy at least one of the following ACP Tests:
(1) The ACP for the Highly Compensated Employees who are
Active Participants during the Plan Year shall not exceed the product of
(A) the ACP for the Active Participants who are not Highly Compensated
Employees during the Plan Year, multiplied by (B) 1.25; or
(2) The ACP for the Highly Compensated Employees who are
Active Participants during the Plan Year shall not exceed the ACP for the
Active Participants who are not Highly Compensated Employees during the
Plan Year by more than 2 percentage points, nor shall it exceed the
product of (A) the ACP of the Active Participants who are not Highly
Compensated Employees during the Plan Year, multiplied by (B) 2.
(b) Multiple Plans. If matching, after tax and/or supplemental
contributions are made to one or more other plans [other than employee stock
ownership plans as described in Code Section 4975(e)(7)] which, along with the
Plan, are considered as a single plan for purposes of Code Section 401(a)(4) or
Section 410(b), such plans shall be treated as one plan for purposes of this
Section, and the matching, after tax and applicable supplemental contributions
made to those other plans shall be combined with the Matching, After Tax and
Supplemental Contributions for purposes of performing the tests described in
subsection (a) hereof. In addition, the Administrative Committee may elect to
treat the Plan as a single plan along with one or more other plans [other than
employee stock ownership plans as described in Code Section 4975(e)(7)] to
which matching, after tax and/or supplemental contributions are made for
purposes of this Section; provided, the Plan and all of such other plans also
must be treated as a single plan for purposes of satisfying the requirements of
Code Section 401(a)(4) and Section 410(b) [other than the requirements of Code
Section 410(b)(2)(A)(ii)]. However, for
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Plan Years beginning after December 31, 1989, plans may be aggregated for
purposes of this subsection only if they have the same plan year.
(c) Adjustments to Average Contribution Percentages. In the
event that the allocation of the After Tax, Before Tax, Matching and
Supplemental Contributions for a Plan Year, after the application of
subsections (a) and (b) hereof, does not satisfy one of the ACP Tests, the
Administrative Committee shall cause such After Tax, Before Tax, Matching
and/or Supplemental Contributions for such Plan Year to be adjusted in
accordance with one or a combination of the following options:
(1) The Administrative Committee may cause the
Participating Companies to make, with respect to such Plan Year,
Supplemental Contributions on behalf of, and specifically allocable to,
the Active Participants described in Section 6.3(a) in the minimum amount
necessary to satisfy one of the ACP Tests; such Supplemental
Contributions shall be allocated among the affected Active Participants
in a manner consistent with Section 6.3. Alternatively or in addition,
the Administrative Committee may add a portion of the Before Tax
Contributions, that are made for the Plan Year by the Participants who
are not Highly Compensated Employees and that are not needed for the Plan
to satisfy the ADP Tests for the Plan Year, to the After Tax and Matching
Contributions for such Participants to increase the ACP for such
Participants.
(2) By the last day of the Plan Year following the Plan
Year in which the annual allocation failed both of the ACP Tests, the
Administrative Committee may direct the Trustee to reduce the After Tax
and/or Matching Contributions taken into account with respect to Highly
Compensated Employees under such failed ACP Tests to be reduced by an
amount necessary to satisfy one of the ACP Tests. Any amount by which
After Tax Contributions are reduced, plus any earnings attributable
thereto, shall be distributed to the Highly Compensated Employees from
whose Accounts such reductions have been made. Any Matching
Contributions made on behalf of Highly Compensated Employees which are
attributable to the distributed After Tax Contributions shall be
forfeited. If these distributions (and forfeitures) do not cause the
Plan to satisfy one of the ACP Tests, the amount by which Matching
Contributions are to be reduced, plus any earnings attributable thereto,
shall be forfeited and reallocated as Supplemental Contributions to the
Supplemental Accounts of the Active Participants described in Section
6.3(a) with respect to such Plan Year; provided, if the Matching
Contributions to be reduced are vested and therefore may not be
forfeited, those Matching Contributions (plus any earnings thereon) shall
be distributed to the Highly Compensated Employees from whose Matching
Accounts such reductions have been made. Such reductions in
Contributions shall be made in accordance with, and solely to the
Accounts of those Highly Compensated Employees who are affected by, the
following procedure:
(A) First, the After Tax and Matching Contributions
of the Highly Compensated Employee(s) with the highest ACP for
such Plan Year shall be reduced by the lesser of (i) the entire
amount necessary to satisfy one of the ACP Tests, or (ii) that
part of the amount necessary to satisfy one of the ACP Tests as
shall cause the ACP of each such Highly Compensated Employee to
equal the ACP of each of the Highly Compensated Employees with the
next highest ACP(s) for such Plan Year. If the total amount of
the required reduction in a Highly Compensated Employee's After
Tax and Matching Contributions is less than the total amount of
such Contributions, the required reductions first shall be charged
against such Highly Compensated Employee's After Tax Contributions
until they are exhausted and then against his remaining Matching
Contributions.
(B) The Administrative Committee shall follow
substantially identical steps for making further reductions in the
Contributions of each of the Highly Compensated Employees with the
next highest ACP for such Plan Year until one of the ACP Tests has
been satisfied.
In reducing the Contributions of Highly Compensated Employees in
subsections (2)(A) and (B) hereof, the Administrative Committee shall
comply with the special "family member" rules contained in the proposed
regulations under Code Section 401(m).
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7.5 Multiple Use of Tests.
(a) Aggregate Limitation. For Plan Years commencing after
December 31, 1988, the sum of the ADP and the ACP for a Plan Year for the
entire group of eligible Highly Compensated Employees who are Active
Participants, after the application of Section Section 7.3(c) and 7.4(c) for
such Plan Year, may not exceed the greater of the amount determined in
subsection (1) or (2) hereof, as follows:
(1) the sum of:
(A) 125 percent of the greater of (i) the ADP of the
group of non-Highly Compensated Employees eligible under the Plan
for the Plan Year, or (ii) the ACP of the group of non-Highly
Compensated Employees who are eligible under the Plan for the Plan
Year; plus
(B) the lesser of 2 percentage points plus or 2
times the lesser of the amount determined in subsection (1)(A)(i)
or (1)(A)(ii) hereof; or
(2) the sum of:
(A) 125 percent of the lesser of (i) the ADP of the
group of non-Highly Compensated Employees eligible under the Plan
for the Plan Year, or (ii) the ACP of the group of non-Highly
Compensated Employees who are eligible under the Plan for the Plan
Year; plus
(B) the lesser of 2 percentage points plus or 2
times the greater of the amount determined in subsection (2)(A)(i)
or (2)(B)(ii).
(b) Multiple Plans. If at least one Highly Compensated Employee
participates in another qualified retirement plan maintained by the
Participating Company which (i) permits before tax contributions and/or after
tax contributions or matching contributions, and (ii) is not aggregated with
the Plan for purposes of nondiscrimination testing, then the multiple use
aggregate limitations described in subsection (a) shall apply in testing the
Plan separately against each such other plan.
(c) Correction. If the maximum limitation of the combination of
the ADP and ACP, as described in subsection (a) hereof, is exceeded, the excess
shall be reduced or otherwise corrected by any method permissible under Section
7.3 for satisfying the ADP Test or through any method permitted under Section
7.4 to satisfy the ACP Test, or any combination thereof. Any adjustment
necessary to satisfy said maximum limitation shall be made by adjusting the
ADP's or the ACP's of Highly Compensated Employees.
(d) Application. This Section shall be operated and interpreted
in a manner consistent with regulations promulgated under Code Section 401(m).
7.6 Order of Application.
For any Plan Year in which adjustments shall be necessary or
otherwise made pursuant to the terms of Section Section 7.2, 7.3 and/or 7.4,
such adjustments shall be applied in the order prescribed by the Secretary of
Treasury in Treasury Regulations or other published authority.
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7.7 Code Section 415 Limitations on Maximum Allocations.
(a) No Other Plan Participation.
(i) If a Participant does not participate in, and has
never participated in another qualified plan maintained by an Affiliate,
or a welfare benefit fund, as defined in Code Section 419(e), maintained
by an Affiliate, or an individual medical account, as defined in Code
Section 415(1)(2), maintained by an Affiliate, or a simplified employee
pension, as defined in Code Section 408(k), maintained by an Affiliate,
which provides an Annual Addition as defined in subsection (e)(i) hereof,
the amount of Annual Additions which may be credited to the Participant's
Account for any Limitation Year will not exceed the lesser of the maximum
permissible amount or any other limitation contained in the Plan. If the
Company Contribution that would otherwise be contributed or allocated to
the Participant's Account would cause the Annual Additions for the
Limitation Year to exceed the maximum permissible amount, the amount
contributed or allocated will be reduced so that the Annual Additions for
the Limitation Year will equal the maximum permissible amount.
(ii) Prior to determining a Participant's actual
Compensation for the Limitation Year, the Affiliates may determine the
maximum permissible amount for the Participant on the basis of a
reasonable estimation of the Participant's Compensation for the
Limitation Year, uniformly determined for all Participants similarly
situated.
(iii) As soon as is administratively feasible after the end
of the Limitation Year, the maximum permissible amount for the Limitation
Year will be determined on the basis of the Participant's actual
Compensation for the Limitation Year.
(iv) If pursuant to subsection (a)(iii) hereof or as a
result of the allocation of Forfeitures, there is an excess amount, the
excess will be disposed of as follows:
(A) A Participant's Annual Addition first shall be
reduced by reducing his After Tax Contributions to the extent of
any such excess, up to the total amount of After Tax Contributions
made on behalf of such Participant, and the amount of the
reduction (plus any investment earnings thereon) shall be returned
to such Participant.
(B) The Participant's Annual Addition next shall be
reduced by reducing Forfeitures allocated to his Account to the
extent of any such excess up to the total amount of Forfeitures
allocated to the Participant, and the amount of the reduction
shall be reallocated to the Accounts of Active Participants who
otherwise are eligible to receive allocations of Forfeitures and
who are not affected by the Annual Addition limitations, in the
same proportion as Forfeitures otherwise are allocated to such
Accounts, disregarding the Compensation of those Active
Participants whose Annual Addition equals or exceeds the
limitations hereunder.
(C) If further reduction is necessary, the Profit
Sharing, Matching and Supplemental Contributions allocated to the
Participant's Account shall be reduced in the order listed in the
amount of the remaining excess. All of the Profit Sharing
Contributions allocated to such Participant shall be reallocated
before his Matching and Supplemental Contributions are reduced,
and all of his Matching Contributions shall be reallocated before
his Supplemental Contributions are reduced. The amount of the
reduction shall be reallocated to the Profit Sharing, Matching and
Supplemental Accounts, respectively, of Active Participants who
otherwise are eligible for allocations of such Contributions and
who are not affected by such limitations, in the same proportion
as Profit Sharing, Matching and Supplemental Contributions
otherwise are allocated to such Accounts, disregarding the
Compensation of those Active Participants whose Annual Addition
equals or exceeds the limitations hereunder.
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(D) If further reduction is necessary, the Before
Tax Contributions allocated to the Participant's Before Tax
Account shall be reduced to the extent of any such excess, up to
the total amount of Before Tax Contributions made on behalf of
such Participant, and the amount of the reduction (plus any
earnings thereon) shall be returned to the Participant.
(E) If the reallocation to the Accounts of other
Participants in the then current Limitation Year (as described in
subsections (a)(iv)(C) and (D) hereof) is impossible without
causing them or any of them to exceed the Annual Addition
limitations described in this Section, the amount that cannot be
reallocated without exceeding such limitations shall continue to
be held in a suspense account and shall be applied to reduce
permissible Contributions in each successive year until such
amount is fully allocated; provided, so long as any suspense
account is maintained pursuant to this Section: (1) no
Contributions shall be made to the Plan which would be precluded
by this Section; (2) investment gains and losses of the Trust Fund
shall not be allocated to such suspense account; and (3) amounts
in the suspense account shall be allocated in the same manner as
Contributions as of the earliest Valuation Date possible, until
such suspense account is exhausted.
(b) Other Master or Prototype Plan Participation.
(i) This Section applies if, in addition to the Plan, the
Participant is covered under another qualified master or prototype
defined contribution plan maintained by an Affiliate, a welfare benefit
fund maintained by an Affiliate, an individual medical account maintained
by an Affiliate, or a simplified employee pension maintained by an
Affiliate, that provides an Annual Addition during any Limitation Year.
The Annual Additions which may be credited to a Participant's Account
under the Plan for any such Limitation Year will not exceed the maximum
permissible amount reduced by the Annual Additions credited to a
Participant's Account under the other qualified master or prototype
defined contribution plans, welfare benefit funds, individual medical
accounts, and simplified employee pensions for the same Limitation Year.
If the Annual Additions with respect to the Participant under other
qualified master or prototype defined contribution plans, welfare benefit
funds, individual medical accounts, and simplified employee pensions
maintained by the Affiliates are less than the maximum permissible amount
and the Company Contribution that would otherwise be contributed or
allocated to the Participant's Account under the Plan would cause the
Annual Additions for the Limitation Year to exceed this limitation, the
amount contributed or allocated will be reduced so that the Annual
Additions under all such plans and funds for the Limitation Year will
equal the maximum permissible amount. If the Annual Additions with
respect to the Participant under such other qualified master or prototype
defined contribution plans, welfare benefit funds, individual medical
accounts, and simplified employee pensions in the aggregate are equal to
or greater than the maximum permissible amount, no amount will be
contributed or allocated to the Participant's Account under the Plan for
the Limitation Year.
(ii) Prior to determining the Participant's actual
Compensation for the Limitation Year, the Affiliates may determine the
maximum permissible amount for a Participant in the manner described in
subsection (a)(ii) hereof.
(iii) As soon as is administratively feasible after the end
of the Limitation Year, the maximum permissible amount for the Limitation
Year will be determined on the basis of the Participant's actual
Compensation for the Limitation Year.
(iv) If, pursuant to subsection (b)(iii) hereof or as a
result of the allocation of Forfeitures, a Participant's Annual Additions
under the Plan and such other plans would result in an excess amount for
a Limitation Year, the excess amount will be deemed to consist of the
Annual Additions last allocated, except that Annual Additions
attributable to a simplified employee pension will be deemed to have been
allocated first, followed by Annual Additions to a welfare benefit fund
or individual medical account, regardless of the actual allocation date.
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(v) If an excess amount was allocated to a Participant on
an allocation date of the Plan which coincides with an allocation date of
another plan, the excess amount attributed to the Plan will be the
product of:
(A) the total excess amount allocated as of such
date; times
(B) the ratio of (1) the Annual Additions allocated
to the Participant for the Limitation Year as of such date under
the Plan to (2) the total Annual Additions allocated to the
Participant for the Limitation Year as of such date under this and
all the other qualified master or Master defined contribution
plans.
(vi) Any excess amount attributed to the Plan will be
disposed in the manner described in subsection (a)(iv) hereof.
(c) Other Non-Master or Non-Prototype Plan Participation. If
the Participant is covered under another qualified defined contribution plan
maintained by an Affiliate which is not a master or prototype plan, Annual
Additions which may be credited to the Participant's Account under the Plan for
any Limitation Year will be limited in accordance with subsections (b)(i)
through (vi) hereof as though the other plan were a master or prototype plan,
unless the Adopting Company provides other limitations in Section 7.2(a) of the
Adoption Agreement.
(d) Defined Benefit Plan. If an Affiliate maintains, or at any
time maintained, a qualified defined benefit plan covering any Participant in
the Plan, the sum of the Participant's Defined Benefit Plan Fraction and
Defined Contribution Plan Fraction will not exceed 1.0 in any Limitation Year.
The Annual Additions which may be credited to the Participant's Account under
the Plan for any Limitation Year will be limited in accordance with Section
7.2(b) of the Adoption Agreement.
(e) Definitions.
(i) "Annual Additions" shall mean the sum of the following
amounts credited to a Participant's Account for the Limitation Year:
(A) Affiliate contributions;
(B) employee contributions
(C) Forfeitures;
(D) amounts allocated, after March 31, 1984, to an
individual medical account, as defined in Code Section 415(1)(2),
which is part of a pension or annuity plan maintained by an
Affiliate are treated as Annual Additions to a defined
contribution plan. Also amounts derived from contributions paid
or accrued after December 31, 1985, in taxable years ending after
such date, which are attributable to post- retirement medical
benefits, allocated to the separate account of a key employee, as
defined in Code Section 419A(d)(3), under a welfare benefit fund,
as defined in Code Section 419(e), maintained by an Affiliate are
treated as Annual Additions to a defined contribution plan; and
(E) allocations under a simplified employee pension.
For this purpose, any excess amount applied under
subsections (a)(iv) or (b)(vi) in the Limitation Year to reduce Company
Contributions will be considered Annual Additions for such Limitation
Year.
(ii) "Compensation" shall mean Section 415 Compensation as
defined in Section 2.25(b). For Limitation Years beginning after
December 31, 1991, for purposes of applying the limitations of this
Section,
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Compensation for a Limitation Year is the Compensation actually paid or
made available in gross income during such Limitation Year.
Notwithstanding the preceding sentence, for purposes of this
Section, Compensation for a Participant in a defined contribution plan
who is Disabled (as defined in Code Section 22(e)(3)) is the Compensation
such Participant would have received for the Limitation Year if the
Participant had been paid at the rate of Compensation paid immediately
before becoming Disabled; such imputed Compensation for the Disabled
Participant may be taken into account only if the Participant is not a
Highly Compensated Employee and contributions made on behalf of such
Participant are nonforfeitable when made.
(iii) "Defined Benefit Fraction" shall mean a fraction, the
numerator of which is the sum of the Participant's projected annual
benefits under all the defined benefit plans (whether or not terminated)
maintained by the Affiliate, and the denominator of which is the lesser
of 125 percent of the dollar limitation determined for the Limitation
Year under Code Section Section 415(b) and (d) or 140 percent of the
highest average compensation, including any adjustments under Code
Section 415(b).
Notwithstanding the above, if the Participant was a
Participant as of the first day of the first Limitation Year beginning
after December 31, 1986, in one or more defined benefit plans maintained
by an Affiliate which were in existence on May 6, 1986, the denominator
of this fraction will not be less than 125 percent of the sum of the
annual benefits under such plans which the Participant had accrued as of
the close of the last Limitation Year beginning before January 1, 1987,
disregarding any changes in the terms and conditions of the Plan after
May 5, 1986. The preceding sentence applies only if the defined benefit
plans individually and in the aggregate satisfied the requirements of
Code Section 415 for all Limitation Years beginning before January 1,
1987.
(iv) "Defined contribution dollar limitation" shall mean
$30,000 or if greater, one-fourth of the defined benefit dollar
limitation set forth in Code Section 415(b)(1) as in effect for the
Limitation Year.
(v) "Defined Contribution Fraction" shall mean a fraction,
the numerator of which is the sum of the Annual Additions to the
Participant's Account under all the defined contribution plans (whether
or not terminated) maintained by the Affiliates for the current and all
prior Limitation Years (including the Annual Additions attributable to
the Participant's nondeductible employee contributions to all defined
benefit plans, whether or not terminated, maintained by the Affiliate,
and the Annual Additions attributable to all welfare benefit funds,
individual medical accounts, and simplified employee pensions, maintained
by the Affiliates), and the denominator of which is the sum of the
maximum aggregate amounts for the current and all prior Limitation Years
of service with the Affiliates (regardless of whether a defined
contribution plan was maintained by the Affiliates). The maximum
aggregate amount in any Limitation Year is the lesser of 125 percent of
the dollar limitation determined under Code Section Section 415(b) and
(d) in effect under Code Section 415(c)(1)(A) or 35 percent of the
Participant's Compensation for such year.
If the Employee was a Participant as of the end of the day
of the first Limitation Year beginning after December 31, 1986, in one or
more defined contribution plans maintained by the Affiliates which were
in existence on May 6, 1986, the numerator of this fraction will be
adjusted if the sum of this fraction and the defined benefit fraction
would otherwise exceed 1.0 under the terms of the Plan. Under the
adjustment, an amount equal to the product of (1) the excess of the sum
of the fractions over 1.0 times (2) the denominator of this fraction,
will be permanently subtracted from the numerator of this fraction. The
adjustment is calculated using the fractions as they would be computed as
of the end of the last Limitation Year beginning before January 1, 1987,
and disregarding any changes in the terms and conditions of the Plan made
after May 5, 1986, but using the Code Section 415 limitation applicable
to the first Limitation Year beginning on or after January 1, 1987.
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The Annual Addition for any Limitation Year beginning before
January 1, 1987, shall not be recomputed to treat all employee
contributions as Annual Additions.
(vi) "Excess amount" shall mean the excess of the
Participant's Annual Additions for the Limitation Year over the maximum
permissible amount.
(vii) "Highest average compensation" shall mean the average
Compensation for the three consecutive Years of Service with the
Affiliates that produces the highest average.
(viii)"Limitation Year" shall mean the Plan Year. If
the Limitation Year is amended to a different 12-consecutive month
period, the new Limitation Year must begin on a date within the
Limitation Year in which the amendment is made.
(ix) "Master or Prototype plan" shall mean a plan the form
of which is the subject of a favorable opinion or notification letter
from the Internal Revenue Service.
(x) "Maximum permissible amount" shall mean the maximum
Annual Addition, that may be contributed or allocated to a Participant's
Account under the Plan for any Limitation Year, which shall not exceed
the lesser of:
(A) the defined contribution dollar limitation, or
(B) 25 percent of the Participant's Compensation for
the Limitation Year.
The Compensation limitation referred to in subsection (B)
hereof shall not apply to any contribution for medical benefits within
the meaning of Code Section 401(h) or Section 419A(f)(2)) which is
otherwise treated as an Annual Addition under Code Section 415(l)(1) or
Section 419A(d)(2).
If a short Limitation Year is created because of an
amendment changing the Limitation Year to a different 12-consecutive
month period, the maximum permissible amount will not exceed the defined
contribution dollar limitation multiplied by the following fraction:
Number of months in the short limitation year
---------------------------------------------
12
(xi) "Projected Annual Benefit" shall mean the annual
retirement benefit (adjusted to an actuarially equivalent straight life
annuity if such benefit is expressed in a form other than a straight life
annuity or qualified joint and survivor annuity) to which the Participant
would be entitled under the terms of the Plan assuming:
(A) the Participant will continue employment until
normal retirement age under the Plan (or current age, if later),
and
(B) the Participant's Compensation for the current
Limitation Year and all other relevant factors used to determine
benefits under the Plan will remain constant for all future
Limitation Years.
7.8 Special Requirements for Plans Covering Owner-Employees.
(a) Aggregation of Plans. If the Plan provides contributions or
benefits for one or more owner-employees (as defined in subsection (e) hereof)
who control both a Participating Company and one or more other trades or
businesses, the Plan and the plan established for such other trades or
businesses must, when looked
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at as a single plan, satisfy Code Section Section 401(a) and (d) for the
Employees of the Participating Company and all such other trades or businesses.
(b) Comparable Benefits. If the Plan provides contributions or
benefits for one or more owner-employees who control one or more other trades
or businesses, the employees of such trades or businesses must be included in a
plan which satisfies Code Section Section 401(a) and (d) and which provides
contributions and benefits not less favorable than provided for owner-employees
under the Plan.
(c) Controlled and Noncontrolled Businesses. If an individual
is covered as an owner-employee under the plans of two or more trades or
businesses which are not controlled and the individual controls a trade or
business, then the contributions or benefits of the employees under the plan of
the trade or business which are controlled must be as favorable as those
provided for him under the most favorable plan of the trade or business which
is not controlled.
(d) Definition of "Controlled". For purposes of this Section,
an owner-employee, or two or more owner- employees, will be considered to
control a trade or business if the owner-employee, or two or more
owner-employees together:
(i) own the entire interest in an unincorporated trade or
business, or
(ii) in the case of a partnership, own more than 50 percent
or either the capital interest or the profits interest in the
partnership.
For purposes of this subsection, an owner-employee, or two or more
owner-employees, shall be treated as owning any interest in a partnership which
is owned, directly or indirectly, by a partnership which such owner-employee,
or such two or more owner-employees, are considered to control with the meaning
of the preceding sentence.
(e) Definition of "Owner-Employee". "Owner-employee" shall mean
an individual who is a sole proprietor, or who is a partner owning more than 10
percent of either the capital or profits interest of the partnership.
7.9 Distribution Requirements.
(a) Controlling Provisions.
(i) Subject to the joint and survivor annuity requirements
in Article XI, the requirements of this Section shall apply to any
distribution of a Participant's interest and will take precedence over
any inconsistent provisions of the Plan. Unless otherwise specified, the
provisions of this Section apply to calendar years beginning after
December 31, 1984.
(ii) All distributions required under this Section shall be
determined and made in accordance with the proposed regulations under
Code Section 401(a)(9), including the minimum distribution incidental
benefit requirement of Section 1.401(a)(9)-2 of the proposed regulations.
(b) Required Beginning Date. The entire interest of a
Participant must be distributed or begin to be distributed no later than the
Participant's required beginning date.
(c) Limits on Distribution Periods. As of the first
distribution calendar year, distribution, if not made in a single sum, may only
be made over one of the following periods (or a combination thereof):
(i) the life of the Participant;
(ii) the life of the Participant and a designated
Beneficiary;
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(iii) a period certain not extending beyond the life
expectancy of the Participant, or
(iv) a period certain not extending beyond the joint and
last survivor expectancy of the Participant and a designated Beneficiary.
(d) Determination of Amount to be Distributed Each Year. If the
Participant's interest is to be distributed in other than a single sum, the
following minimum distribution rules shall apply on or after the required
beginning date:
(i) If a Participant's benefit is to be distributed over
(A) a period not extending beyond the life expectancy of the Participant
or the joint life and last survivor expectancy of the Participant and the
Participant's designated Beneficiary or (B) a period not extending beyond
the life expectancy of the designated Beneficiary, the amount required to
be distributed for each calendar year, beginning with distributions for
the first distribution calendar year, must at least equal the quotient
obtained by dividing the Participant's benefit by the applicable life
expectancy.
(ii) For calendar years beginning before January 1, 1989,
if the Participant's Spouse is not the designated Beneficiary, the method
of distribution selected must assure that at least 50% of the present
value of the amount available for distribution is paid within the life
expectancy of the Participant.
(iii) For calendar years beginning after December 31, 1988,
the amount to be distributed each year, beginning with distributions for
the first distribution calendar year shall not be less than the quotient
obtained by dividing the Participant's benefit by the lesser of (A) the
applicable life expectancy or (B) if the Participant's Spouse is not the
designated Beneficiary, the applicable divisor determined from the table
set forth in Q&A-4 of Section 1.401(a)(9)-2 of the proposed regulations.
Distributions after the death of the Participant shall be distributed
using the applicable life expectancy in subsection (d)(i) hereof as the
relevant divisor without regard to Section 1.401(a)(9)-2 of the proposed
regulations.
(iv) The minimum distribution required for the
Participant's first distribution calendar year must be made on or before
the Participant's required beginning date. The minimum distribution for
other calendar years, including the minimum distribution for the
distribution calendar year in which the Employee's required beginning
date occurs, must be made on or before December 31 of that distribution
calendar year.
(v) If the Participant's benefit is distributed in the
form of an annuity purchased from an insurance company, distributions
thereunder shall be made in accordance with the requirements of Code
Section 401(a)(9) and the proposed regulations thereunder.
(e) Death Distribution Provisions.
(i) If the Participant dies after distribution of his or
her interest has begun, the remaining portion of such interest will
continue to be distributed at least as rapidly as under the method of
distribution being used prior to the Participant's death.
(ii) If the Participant dies before distribution of his or
her interest begins, distribution of the Participant's entire interest
shall be completed by December 31 of the calendar year containing the
fifth anniversary of the Participant's death except to the extent that an
election is made to receive distributions in accordance with subsection
(A) or (B) below:
(A) if any portion of the Participant's interest is
payable to a designated Beneficiary, distributions may be made
over the life or over a period certain not greater than the life
expectancy of the designated Beneficiary commencing on or before
December 31 of the calendar year immediately following the
calendar year in which the Participant died;
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(B) if the designated Beneficiary is the
Participant's Surviving Spouse, the date distributions are
required to begin in accordance with (i) above shall not be
earlier than the later of (1) December 31 of the calendar year
immediately following the calendar year in which the Participant
died and (2) December 31 of the calendar year in which the
Participant would have attained age 70 1/2.
If the Participant has not made an election pursuant
to this subsection (e)(ii) by the time of his or her death, the
Participant's designated Beneficiary must elect the method of
distribution no later than the earlier of (1) December 31 of the
calendar year in which distributions would be required to begin
under this Section, or (2) December 31 of the calendar year which
contains the fifth anniversary of the date of death of the
Participant. If the Participant has no designated Beneficiary, or
if the designated Beneficiary does not elect a method of
distribution, distribution of the Participant's entire interest
must be completed by December 31 of the calendar year containing
the fifth anniversary of the Participant's death.
(iii) For purposes of subsection (e)(ii) above, if the
Surviving Spouse dies after the Participant, but before payments to such
Spouse begin, the provisions of subsection (e)(ii), with the exception of
paragraph (B) therein, shall be applied as if the Surviving Spouse were
the Participant.
(iv) For the purposes of this subsection (e), distribution
of a Participant's interest is considered to begin on the Participant's
required beginning date (or, if subsection (e)(iii) above is applicable,
the date distribution is required to begin to the Surviving Spouse
pursuant to subsection (e)(ii) above). If distribution in the form of an
annuity irrevocably commences to the Participant before the required
beginning date, the date distribution is considered to begin is the date
distribution actually commences.
(f) Definitions. For purposes of this Section, the following
terms shall have the specified meanings:
(i) "Applicable life expectancy" shall mean the life
expectancy (or joint and last survivor expectancy) calculated using the
attained age of the Participant (or designated Beneficiary) as of the
Participant's (or designated Beneficiary's) birthday in the applicable
calendar year reduced by one for each calendar year which has elapsed
since the date life expectancy was first calculated. If life expectancy
is being recalculated, the applicable life expectancy shall be the life
expectancy as so recalculated. The applicable calendar year shall be the
first distribution calendar year, and if life expectancy is being
recalculated such succeeding calendar year.
(ii) "Designated beneficiary" shall mean the individual who
is designated as the Beneficiary under the Plan in accordance with Code
Section 401(a)(9) and the proposed regulations thereunder.
(iii) "Distribution calendar year" shall mean a calendar
year for which a minimum distribution is required. For distributions
beginning before the Participant's death, the first distribution calendar
year is the calendar year immediately preceding the calendar year which
contains the Participant's required beginning date. For distributions
beginning after the Participant's death, the first distribution calendar
year is the calendar year in which distributions are required to begin
pursuant to subsection (e) hereof.
(iv) "Life expectancy" shall mean life expectancy and joint
and last survivor expectancy as computed by use of the expected return
multiples in Tables V and VI of Section 1.72-9 of the regulations.
Unless otherwise elected by the Participant (or Spouse, in
the case of distributions described in subsection (e)(ii)(B) above) by
the time distributions are required to begin, life expectancies shall be
recalculated annually. Such election shall be irrevocable as to the
Participant (or Spouse) and shall apply to all subsequent years. The
life expectancy of a nonspouse Beneficiary may not be recalculated.
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(v) "Participant's benefit" shall mean:
(A) The Account balance as of the last valuation
date in the calendar year immediately preceding the distribution
calendar year (valuation calendar year) increased by the amount of
any Contributions or Forfeitures allocated to the Account balance
as of dates in the valuation calendar year after the valuation
date and decreased by distributions made in the valuation calendar
year after the valuation date.
(B) For purposes of subsection (A) above, if any
portion of the minimum distribution for the first distribution
calendar year is made in the second distribution calendar year on
or before the required beginning date, the amount of the minimum
distribution made in the second distribution calendar year shall
be treated as if it had been made in the immediately preceding
distribution calendar year.
(vi) "Required beginning date" shall mean:
(A) The required beginning date of a Participant is
the first day of April of the calendar year following the calendar
year in which the Participant attains age 70 1/2.
(B) The required beginning date of a Participant who
attains age 70 1/2 before January 1, 1988, shall be determined in
accordance with (1) or (2) below:
(1) The required beginning date of a
Participant who is not a 5-percent owner is the first day of
April of the calendar year following the calendar year in
which the later of retirement or attainment of age 70 1/2
occurs.
(2) The required beginning date of a
Participant who is a 5-percent owner during any year
beginning after December 31, 1979, is the first day of April
following the later of:
(i) the calendar year in which the
Participant attains age 70 1/2, or
(ii) the earlier of the calendar year
with or within which ends the plan year in which the
Participant becomes a 5-percent owner, or the calendar
year in which the Participant retires.
The required beginning date of a Participant who is
not a 5-percent owner who attains age 70 1/2 during 1988 and who
has not retired as of January 1, 1989, is April 1, 1990.
(C) A Participant is treated as a 5-percent owner
for purposes of this section if such Participant is a 5-percent
owner as defined in Code Section 416(i) (determined in accordance
with Code Section 416 but without regard to whether the Plan is
top-heavy) at any time during the Plan Year ending with or within
the calendar year in which such owner attains age 66 1/2or any
subsequent Plan Year.
(D) Once distributions have begun to a 5-percent
owner under this subsection, they must continue to be distributed,
even if the Participant ceases to be a 5-percent owner in a
subsequent year.
(g) Transitional Rule.
(i) Notwithstanding the other requirements of this Section
and subject to the joint and survivor annuity requirements of Article XI,
distribution on behalf of any Employee, including a 5-percent owner, may
be made in accordance with all of the following requirements (regardless
of when such distribution commences):
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(A) The distribution by the Plan is one which would
not have disqualified such Plan under Code Section 401(a)(9) as in
effect prior to amendment by the Deficit Reduction Act of 1984.
(B) The distribution is in accordance with a method
of distribution designated by the Employee whose interest in the
Plan is being distributed or, if the Employee is deceased, by a
Beneficiary of such Employee.
(C) Such designation was in writing, was signed by
the Employee or the Beneficiary, and was made before January 1,
1984.
(D) The Employee had accrued a benefit under the
Plan as of December 31, 1983.
(E) The method of distribution designated by the
Employee or the Beneficiary specifies the time at which
distribution will commence, the period over which distributions
will be made, and in the case of any distribution upon the
Employee's death, the Beneficiaries of the Employee listed in
order of priority.
(ii) A distribution upon death will not be covered by this
transitional rule unless the information in the designation contains the
required information described above with respect to the distributions to
be made upon the death of the Employee.
(iii) For any distribution which commences before January 1,
1984, but continues after December 31, 1983, the Employee, or the
Beneficiary, to whom such distribution is being made, will be presumed to
have designated the method of distribution under which the distribution
is being made if the method if distribution was specified in writing and
the distribution satisfies the requirements in subsections (g)(i)(A) and
(E) hereof.
(iv) If a designation is revoked any subsequent
distribution must satisfy the requirements of Code Section 401(a)(9) and
the proposed regulations thereunder. If a designation is revoked
subsequent to the date distributions are required to begin, the Plan must
distribute by the end of the calendar year following the calendar year in
which the revocation occurs the total amount not yet distributed which
would have been required to have been distributed to satisfy Code Section
401(a)(9) and the proposed regulations thereunder, but for the Section
242(b)(2) election. For calendar years beginning after December 31,
1988, such distributions must meet the minimum distribution incidental
benefit requirements in Section 1.401(a)(9)-2 of the proposed
regulations. Any changes in the designation will be considered to be a
revocation of the designation. However, the mere substitution or
addition of another Beneficiary (one not named in the designation) under
the designation will not be considered to be a revocation of the
designation, so long as such substitution or addition does not alter the
period over which distributions are to be made under the designation,
directly or indirectly (for example, by altering the relevant measuring
life). In the case in which an amount is transferred or rolled over from
one plan to another plan, the rules in Q&A J-2 and Q&A J-3 shall apply.
7.10 Construction of Limitations and Requirements.
The descriptions of the limitations and requirements set forth in
this Article are intended to serve as statements of the minimum legal
requirements necessary for the Plan to remain qualified under the applicable
terms of the Code. The Adopting Company does not desire or intend, and the
terms of this Article shall not be construed, to impose any more restrictions
on the operation of the Plan than required by law. Therefore, the terms of
this Article and any related terms and definitions in the Plan shall be
interpreted and operated in a manner which imposes the least restrictions on
the Plan. For example, if use of a more liberal definition of "Compensation"
or a more liberal multiple use test is permissible at any time under the law,
then the more liberal provisions may be applied as if such provisions were
included in the Plan.
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ARTICLE VIII
INVESTMENT OF ACCOUNTS
8.1 Establishment of Trust Fund; Investment of Assets.
All Contributions shall be paid over (i) to the Master Trustee to
be held in the Master Trust Fund and invested in accordance with the terms of
the Plan and the Master Trust Agreement and/or (ii) if the Administrative
Committee elects in Section 8.2 of the Adoption Agreement to permit investment
of the Plan in Company Stock, to the Company Stock Trustee and invested in
accordance with the terms of the Plan and the Company Stock Trust Agreement.
The Administrative Committee shall determine, in its sole discretion, the
amount of Contributions to be paid to the Master Trustee and the Company Stock
Trustee, and each Trustee shall rely on the Administrative Committee's
determination. Unless the Adopting Company elects in Section 8.1 of the
Adoption Agreement to permit Participants and Beneficiaries to direct the
investment of their respective Accounts pursuant to Section 8.3, the
Administrative Committee, in its sole discretion, shall direct the Master
Trustee to invest the assets of the Master Trust Fund among the Investment
Funds. The Company Stock Trustee, in its sole discretion, shall direct the
investment of the assets of the Company Stock Trust Fund in Company Stock.
8.2 Investment Funds.
(a) Named Investment Funds. In accordance with the terms of the
Plan, the Master Trustee shall establish such Named Investment Funds, for the
investment of assets of the Master Trust Fund, which may include a fixed income
fund and an equity fund.
(b) Other Investment Funds. The Master Trustee also may
establish other Investment Funds, in addition to or in lieu of the fixed income
fund or equity funds, or which may consist of a blend of such funds. Such
other Investment Funds shall be established without necessity of amendment to
the Plan or the Master Trust and shall have the investment objectives
established by the Master Trustee. Such other Investment Funds also may be
established and maintained for any limited purpose(s) the Master Trustee may
establish (for example, for the investment of certain specified Transfer
Accounts).
(c) Reinvestment of Cash Earnings. Any investment earnings
received in the form of cash with respect to any Investment Fund (in excess of
the amounts necessary to pay Plan or Trust expenses) or the Company Stock Trust
Fund (in excess of the amounts necessary to pay Plan or Company Stock Trust
expenses) shall be reinvested in such Investment Fund or Company Stock Trust
Fund.
8.3 Participant Direction of Investments.
If elected by the Adopting Company in Section 8.1 of the Adoption
Agreement, each Participant or Beneficiary generally may direct the Master
Trustee and/or the Company Stock Trustee (if elected by the Adopting Company in
Section 8.2 of the Adoption Agreement) in the manner in which his Accounts
shall be invested in and among the Investment Funds or the Company Stock Trust
Fund; provided, such investment directions shall be made in accordance with the
following terms and the terms of Section 8.5:
(a) Investment of Contributions. Except as otherwise provided
in this Section, each Participant may elect, on a form provided by the
Administrative Committee, the percentage of future Contributions made on his
behalf that will be invested in each Investment Fund or, if applicable, the
Company Stock Trust Fund. An initial election of a Participant shall be made
as of the date the Participant commences or recommences participation in the
Plan (or, if earlier, the date as of which a Rollover or Transfer Contribution
shall be made) and shall apply to all Contributions attributable to payroll
periods ending after, and to all Rollover and Transfer Contributions made
after, such date. Such Participant may make subsequent elections at such
frequency and as of such effective dates as the Administrative
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Committee shall establish. Such elections shall apply to all Contributions
attributable to payroll periods ending after, and to all Rollover and Transfer
Contributions made after the first business day after the Valuation Date
immediately following such election. Any election made pursuant to this
subsection with respect to future Contributions shall remain effective until
changed by such Participant. In the event a Participant fails to make an
investment election or a Participant's investment election form is incomplete
or insufficient in some manner, future Contributions made on behalf of such
Participant shall be allocated among the Investment Funds in such proportions
as the Administrative Committee, in its sole discretion, shall determine.
(b) Investment of Existing Account Balances. Except as
otherwise provided in this Section, each Participant or Beneficiary may elect,
on a form provided by the Administrative Committee, the percentage of his
existing Accounts that will be invested in each Investment Fund or, if
applicable, the Company Stock Trust Fund. Such Participant or Beneficiary may
make such elections at such frequency and as of such effective dates as the
Administrative Committee shall establish. Each such election shall apply to
such Participant's or Beneficiary's Account as of the first business day after
the Valuation Date immediately following such election and shall remain in
effect until changed by such Participant or Beneficiary. In the event a
Participant fails to make an election for his existing Accounts pursuant to the
terms of this subsection (b) which is separate from his election made for his
Contributions pursuant to the terms of subsection (a) hereof or if a
Participant's investment election form is incomplete or insufficient in some
manner, the Participant's existing Accounts will continue to be invested in the
same manner provided under the terms of the most recent election affecting that
portion of his Accounts.
(c) Conditions Applicable to Elections. Allocations of
investments in the various Investment Funds, and Company Stock Trust Fund, as
described in subsections (a) and (b) hereof, shall be made in the increments
established by the Investment Manager or Trustee maintaining such fund, as
directed by the Participant or Beneficiary. The Administrative Committee shall
have complete discretion to adopt and revise procedures to be followed in
making such investment elections, provided that such procedures are consistent
with the requirements imposed by the Investment Manager or Trustee with respect
to any Investment Fund. Such procedures may include, but are not limited to,
the format of the election forms, the deadline for filing elections and the
effective date of such elections; provided, elections must be permitted at
least once every 6 months. Any procedures adopted by the Administrative
Committee that are inconsistent with the provisions of this Section shall
supersede such provisions of this Section without the necessity of a Plan
amendment.
(d) Investment of Certain Stock Dividends and Other Assets. The
Trust may receive assets other than fixed income contracts or cash. In its
discretion, the Master Trustee may liquidate such assets and reinvest the
proceeds therefrom in the fixed income fund. After such proceeds are invested
in the fixed income fund, a Participant or Beneficiary may change the
investment thereof in such manner and at such times permitted pursuant to the
terms of Section 8.3(b).
(e) Investments with Distributions Made in Annuity or
Installment Payments. Pursuant to the terms of Section 10.3 or Section 11.3,
if a Participant or Beneficiary elects for his Account balance to be
distributed in the form of annuity or installment payments, the full amount in
his Account may be converted into cash and shall either be (A) invested in, and
remain invested in, the Trust Fund, or (B) used to purchase an annuity to
provide benefits in the form elected by such Participant or Beneficiary.
(f) Failure to Elect. If any Participant or Beneficiary fails
or chooses not to direct the investment of all or any portion of his Accounts,
the Administrative Committee shall determine the amount of such Accounts that
shall be invested in the Company Stock Trust Fund, if applicable, and the
amount that shall be invested in the Master Trust Fund. Further, the
Administrative Committee shall determine, in its sole discretion, the
allocation of such amounts paid to the Master Trust Fund among the Investment
Funds.
(g) Fiduciary Responsibilities of Trustee. To the extent and
with respect to the amounts for which Participants or Beneficiaries have
directed the investment of their Accounts, the Trustee shall be relieved of its
fiduciary responsibilities as provided in Section 404 of ERISA.
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8.4 Valuations.
(a) General. The Trust Fund shall be valued by the Trustee at
fair market value as of the close of business on each Valuation Date. A
similar valuation of the Trust Fund may occur at any other time upon direction
of the Administrative Committee. For all purposes under the Plan for which the
value of Company Stock must be determined, the value of such stock shall be
determined exclusively by the Company Stock Trustee and shall be its fair
market value. In the case of a transaction between the Plan and a disqualified
person [within the meaning of Code Section 4975(e)(2),], the value shall be
determined as of the date of the transaction; for all other purposes, the value
shall be determined as of the most recent Valuation Date. Determinations of
value shall be made in good faith, based on relevant factors for determining
the fair market value of securities and in accordance with the requirements of
ERISA Section 3(18) (relating to adequate consideration).
(b) Share Accounting. For accounting and reporting purposes,
the Company Stock Fund and, as permitted by the Master Trustee, any other
Investment Funds for which share accounting is available, shall be accounted
for in terms of whole and fractional shares of stock or other measures of
Investment Funds ownership interests, as applicable, as well as in terms of the
fair market value of such stock or ownership interests.
8.5 Investment in Company Stock.
(a) General. If elected by the Adopting Company in Section 8.2
of the Adoption Agreement, the assets of a Plan may be invested in Company
Stock; provided, if the Company Stock of an Adopting Company is not Publicly
Traded, the Before Tax, After Tax, Rollover and, to the extent they include
Contributions of a Participant, Transfer Accounts, of a Participant may not be
invested in the Company Stock Trust Fund.
(b) Purchase of Shares. The Company Stock Trustee shall
purchase whole shares of Company Stock on each Valuation Date (and only on a
Valuation Date) for which cash amounts are received by or held in the Company
Stock Trust Fund. The Company Stock Trustee shall make such purchases in
compliance with all applicable securities laws and may purchase Company Stock
(i) in the open market (if any), (ii) in privately negotiated transactions with
holders of Company Stock and/or the Participating Company, and/or (iii) through
the exercise of stock rights, warrants or options. Alternatively, the Company
Stock Trustee may acquire the requisite number of shares of Company Stock from
shares already acquired for other Participants' Accounts and made available
pursuant to the procedure described in subsection (c)(ii) hereof. The Company
Stock Trustee shall make all purchases of Company Stock at a price or prices
which, in the judgment of the Company Stock Trustee, do not exceed the fair
market value of such Company Stock as of the date of the purchase; with respect
to Company Stock purchased on the open market, the total cost to Participants
will include acquisition costs. To the extent the Company Stock Trustee deems
it prudent, cash held by the Company Stock Trustee for investment in Company
Stock may be paid over to and invested by the Master Trustee pending the next
Valuation Date. In such event, the Master Trustee shall transfer all such
amounts (as adjusted for earnings and losses) to the Company Stock Trustee at
such time as agreed to by the Trustees.
(c) Liquidation of Shares. To the extent that any shares of
Company Stock held in the Company Stock Trust Fund are to be liquidated for
purposes of investing in one or more of the other Investment Funds, making
distributions and/or otherwise, the Company Stock Trustee, in a manner
consistent with the terms of subsection (b) hereof, shall either (i) sell, at
fair market value, the appropriate number of shares of Company Stock to effect
such election, or (ii) retain such shares for credit to other Participants'
Accounts; any shares of Company Stock so retained shall be deemed to have been
sold at fair market value on the Valuation Date as of which the election to
sell is to be effective.
(d) Warrants, Options. In the event any rights, warrants or
options are issued on Company Stock, the Company Stock Trustee may exercise
them for the acquisition of additional Company Stock, respectively, to the
extent that cash is then available and allocable in the Company Stock Trust
Fund, to the Accounts of the Participant or Beneficiary with respect to whose
Company Stock said rights, warrants or options are issued. Any Company
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Stock acquired in this fashion will be treated as Company Stock bought by the
Company Stock Trustee for the net price paid. Any rights, warrants or options
on Company Stock which cannot be exercised for lack of available cash or which
the Company Stock Trustee decides not to exercise may be sold by the Company
Stock Trustee (provided the sale thereof is reasonably practicable), and the
proceeds of such a sale shall be treated as a current cash dividend received on
Company Stock.
8.6 Voting and Tender Offer Rights With Respect to Company Stock.
(a) Voting Rights. To the extent and in the manner provided in
the Company Stock Trust Agreement, the Company Stock Trustee shall vote shares
of Company Stock held in the Company Stock Trust Fund in accordance with proper
directions of the Administrative Committee.
(b) Tender Offer Rights. The Company Stock Trustee shall tender
shares of Company Stock pursuant to the terms of the Company Stock Trust
Agreement and in accordance with proper directions of the Administrative
Committee.
8.7 Voting and Tender Offer Rights With Respect to Investment Funds
Other Than the Company Stock Fund.
Except to the extent and in the manner permitted by the Trust
and/or any documents establishing or controlling any of the Investment Funds
other than the Company Stock Fund, Participants and Beneficiaries shall not be
given the opportunity to vote and tender their interests in each such
Investment Fund. Such interests shall be voted and/or tendered by the
investment manager or the fiduciary that controls such Investment Fund, as may
be provided in the controlling documents.
8.8 Investments in Life Insurance.
If life insurance policies are transferred from another qualified
plan to the Trust, the Trustee shall be authorized to continue to invest assets
of the Plan in such whole or term life insurance policies, subject to the
limitations under the Code and corresponding Treasury regulations, until such
time as the Trustee deems it prudent to liquidate such policies.
8.9 Single Plan.
The assets of the Plan of an Adopting Company shall consist of the
sum of the Plan's allocable share of the Master Trust Fund and the assets held
in the Company Stock Fund, and it is intended that such interests,
collectively, shall constitute a single plan within the meaning of Code Section
414. Notwithstanding the foregoing, the Master Trust and the Company Stock
Trust shall be separate trusts and the assets of one may not be commingled with
the assets of the other.
8.10 Investments in Bank Deposits.
If in the discretion of the Master Trustee it is in the best
interests of the Plan Participants and Beneficiaries to do so, the assets of
the Master Trust Fund may be invested in deposits bearing a reasonable rate of
interest in a bank or similar financial institution which is also a
Participating Company or an Affiliate of the Participating Company; provided,
any such investment shall be specifically directed by the Master Trustee in a
written authorization naming the bank or similar financial institution. In no
event shall an individual trustee who is a member of the Master Trustee
participate directly or indirectly in the decision to make such an investment
if the individual trustee has any interest in the bank or similar financial
institution which may affect the trustee's best judgment.
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ARTICLE IX
VESTING IN ACCOUNTS
9.1 General Vesting Rule.
(a) General Rules. All Participants shall at all times be fully
vested in their Before Tax, After Tax, Supplemental, Rollover, Transfer, and
Voluntary Accounts. Except as provided in Section Section 9.2 and 9.4, the
Matching and Profit Sharing Accounts of a Participant shall vest in accordance
with the vesting schedule elected by the Adopting Company pursuant to Section
9.1 of the Adoption Agreement. The vested percentage of a Participant's
Account shall be based on the total of his Years of Vesting Service.
(b) Exclusions. Notwithstanding any other provisions of this
Article, if a Participant who was a Participant in a Prior Plan does not
complete at least one Hour of Service on or after the Effective Date, the
vested portion of such Participant's Account shall be determined in accordance
with the terms of the Prior Plan as in effect prior to the Effective Date.
9.2 Vesting Upon Attainment of Normal Retirement Age, Death or
Disability.
Notwithstanding Section 9.1, a Participant's Matching and Profit
Sharing Accounts shall become 100 percent vested and nonforfeitable upon the
occurrence of any of the following events:
(a) Normal Retirement Age. The Participant's attainment of
Normal Retirement Age while still employed as an employee of any Affiliate;
(b) Death. The Participant's death while still employed as an
employee of any Affiliate; or
(c) Disability. The Participant's becoming Disabled while still
employed as an employee of any Affiliate.
9.3 Timing of Forfeitures and Vesting after Restoration Contributions.
If a Participant who is not yet 100 percent vested in his Account
separates from service with all Affiliates, the nonvested amounts in his
Matching and Profit Sharing Accounts shall be removed from such Accounts and
allocated in accordance with the terms of the Plan for the Plan Year during
which such separation occurs; provided, if a Participant has no vested interest
in his Accounts at the time he separates from service, he shall be deemed to
have received a cash-out distribution at the time he separates from service and
the forfeiture provisions of this Section shall apply. (A Participant's vested
Account balance shall not include accumulated deductible employee contributions
within the meaning of Code Section 72(o)(5)(B) for Plan Years beginning prior
to January 1, 1989.) If such a Participant does not resume employment with an
Affiliate before he has incurred 5 or more consecutive Breaks in Service, the
nonvested portion of his Account shall be forfeited and may not be restored.
If such a Participant resumes employment with an Affiliate before he has
incurred 5 consecutive Breaks in Service, the nonvested amount shall be
restored as follows:
(a) Reemployment And Vesting After Cash-Out Distribution. If by
the date of reemployment such a Participant has received a distribution of the
entire vested interest in his Account not later than the close of the second
Plan Year following the Plan Year in which his separation from service with all
Affiliates occurred, the provisions of Section 4.9(a) shall be applicable
(regarding repayment by such a Participant as a condition for restoration of
the nonvested amount). The rehired individual immediately shall be credited on
the vesting schedule set forth in Section 9.1 of the Adoption Agreement with
all previously earned Years of Vesting Service; or shall be credited with
previously earned Years of Vesting Service upon repayment of the previous
distribution, if such repayment is required.
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(b) Reemployment and Vesting Before Any Distribution. If by the
date of reemployment such a Participant has not received any distributions of
his vested interest in his Account, or if he has no vested interest in his
Account and is deemed to have received a cash-out distribution pursuant to this
Section, the nonvested amount of his Matching and Profit Sharing Accounts shall
be restored pursuant to the terms of Section 4.9(b) and shall be credited to
his Matching and Profit Sharing Accounts, respectively. The Participant's
Account then shall be subject to all of the vesting rules in this Article IX as
if no Forfeitures or restrictions had occurred.
(c) Reemployment And Vesting After Other Distribution or Prior
to Distribution. If by the date of reemployment such a Participant (i) has
received a distribution of a portion but not all of the vested portion of his
Account, or (ii) has received a distribution of the entire vested interest in
his Account later than the close of the second Plan Year following the Plan
Year in which separation from service with all Affiliates occurred, then,
notwithstanding the general rules set forth in Section 9.1, the nonvested
amount of his Account shall be restored pursuant to the terms of Section
4.9(b), and the total amount of his undistributed Matching and Profit Sharing
Accounts (including the restored amount) shall be credited to his Matching and
Profit Sharing Accounts, respectively. The vested interest of such Participant
in such Matching and Profit Sharing Accounts prior to the date such Participant
(i) again separates from service with all Affiliates, (ii) incurs 5 consecutive
1-year Breaks in Service (such that the nonvested portion of his Matching and
Profit Sharing Accounts are forfeited), or (iii) becomes 100 percent vested
pursuant to the terms of Section 9.1 or Section 9.2 hereof (whichever is
earliest), shall be determined pursuant to the following formula:
X = P (AB + [R x D]) - (R x D),
where X is the vested interest at the relevant time (that is, the time at which
the vested percentage in such Matching or Profit Sharing Accounts cannot
increase); P is the vested percentage at the relevant time; AB is the balance
of his Matching or Profit Sharing Account at the relevant time; D is the amount
of the distribution; and R is the ratio of his Matching or Profit Sharing
Account balances at the relevant time to such Account balance immediately after
the distribution.
9.4 Amendment to Vesting Schedule.
Notwithstanding anything herein to the contrary, in no event shall
the terms of the Plan or any amendment to the Plan reduce the vested percentage
that any Participant has earned under the Plan. In the event that the Plan
provides for Participants to vest in their Accounts at a rate which is faster
than that provided under any amendment hereto (or in the event any other change
is made that directly has an adverse effect on Participants' vested
percentage), any Participant who has 3 or more years of vesting service
[calculated in a manner consistent with Treasury Regulation Section 1.411(a)-8T
(or any successor section)] may elect to have his vested percentage calculated
under the schedule in the Plan before any such change, and the Administrative
Committee shall give each such Participant notice of his rights to make such an
election. The period during which the election may be made shall commence with
the date the amendment is adopted or deemed to be made and shall end on the
latest of: (1) 60 days after the amendment is adopted; (2) 60 days after the
amendment becomes effective; or (3) 60 days after the Participant is issued
written notice of the amendment by a Participating Company or Administrative
Committee.
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ARTICLE IV
PAYMENT OF BENEFITS WITHOUT ANNUITY PROVISIONS
This Article shall apply only if elected by the Adopting Company pursuant to
10.1 of the Adoption Agreement. (Article X and Article XI are mutually
exclusive; only one can be elected in the Adoption Agreement, and only one can
apply; provided, notwithstanding that the Adopting Company elects this Article
X, if the Plan is a transfer plan with respect to any accounts that provide for
a life annuity form of distribution, such that the exception to the
requirements of Code 401(a)(11) [set forth in Code 401(a)(11)(B)(iii)] is not
applicable, the distribution provisions of Article XI shall apply but only to
the extent required under Code 411(d)(6) and Code 401(a)(11), with respect to
such Transfer Accounts.
10.1 Benefit Payments Upon Separation From Service For Reasons Other
Than Death.
(a) General Rule Concerning Benefits Payable. Subject to the
requirements of Section 7.9, and in accordance with the terms of subsection (b)
hereof and subject to the restrictions set forth in subsections (c) and (d)
hereof, if a Participant separates from service with all Affiliates for any
reason other than death, or if a Participant becomes Disabled but remains an
employee of an Affiliate, he (or his Beneficiary, if he dies after such
separation from service) shall be entitled to receive or begin receiving a
distribution of the total of (i) the entire vested amount credited to his
Account, determined as of the Valuation Date coincident with or immediately
preceding the date payment of such distribution is to be made or commenced (or,
if daily Valuation Dates are elected in Section 2.1(d) of the Adoption
Agreement, the Valuation Date on which such distribution is processed), plus
(ii) the vested amount of any Contributions made on his behalf since such
Valuation Date. For purposes of this subsection, the "date payment of such
distribution is to be made or commenced" refers to the date established for
such purpose by administrative practice, even if actual payment is made or
commenced at a later date due to delays in the valuation, administrative or any
other procedure.
(b) Timing of Distribution.
(1) Except as provided in subsections (b)(2), (b)(3) and
(d) hereof, benefits payable to a Participant under this Section shall be
distributed, or shall commence to be distributed, as soon as
administratively feasible after such Participant becomes Disabled or
separates from service with all Affiliates for any reason other than
death.
(2) Notwithstanding the foregoing, in the event that (A)
the value of the vested amount of the Participant's Account exceeds (or
at anytime prior to distribution exceeded) $3,500 and (B) the benefit
distribution (or commencement) date described in subsection (b)(1) hereof
occurs or is to occur prior to the Participant's Normal Retirement Age,
benefits shall not be distributed (or commence to be distributed) to such
Participant at the time set forth in subsection (b)(1) hereof without the
Participant's written consent, on a form provided by the Administrative
Committee; provided, failure to consent shall be deemed an election to
defer; and provided further, no consent shall be required to make a
distribution required to satisfy Code Section 401(a)(9) or Section 415.
Prior to accepting such written consent, the Administrative Committee
shall provide to the Participant, no less than 30 days and no more than
90 days prior to the benefit distribution date described in subsection
(b)(1) hereof, a notice to such Participant describing the features and
forms of payment available and the Participant's right to defer receipt
of his distribution. With the Participant's written consent, the
distribution may commence less than 30 days after such notice is given;
provided, the Administrative Committee informs the Participant that he
has a right to a period of at least 30 days after receiving the notice to
consider to elect a distribution (or a form of distribution, if
applicable) and the Participant affirmatively elects to receive a
distribution after receiving the notice. If the Participant does not
consent, in writing, to the distribution (or commencement of his
distribution) of his benefit at such time, his vested benefit shall be
distributed (or commence to be distributed) as soon as practicable after
he files a written election with the
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Administrative Committee requesting such payment. If a Participant fails
to file a written election specifying the time of payment, then, unless
the Participant elects to further defer distribution of his benefit and
the Participant makes such an election in writing, his vested benefit
shall be distributed (or commence to be distributed) as soon as
administratively feasible after the end of the Plan Year in which he
attains Normal Retirement Age, but in no event later than the 60th day
after the end of such Plan Year; provided, if the amount of payment
required to be made on such date cannot be ascertained by such date,
payment shall be made (or commence) no later than 60 days after the
earliest date on which such payment can be ascertained under the Plan.
(3) Notwithstanding anything in the Plan to the contrary,
in no event shall payment of a Participant's benefit commence (or be
made), retroactive to such date, later than 60 days after the end of the
Plan Year which includes the latest of (i) the date on which the
Participant attained Normal Retirement Age, (ii) the date which is the
10th anniversary of the date he commenced participation in the Plan, or
(iii) the date he actually separates from service with all Affiliates;
provided, if the amount of the payment cannot be ascertained by the date
as of which payments are scheduled to commence (or be made) hereunder,
payment shall commence (or be made) no later than 60 days after the
earliest date on which such payment can be ascertained under the Plan;
and provided, further, the Participant's benefit payments shall commence
(or be made) no later than the April 1 following the calendar year in
which the Participant attains age 70 1/2 without regard to whether he has
actually ceased employment as an employee of all Affiliates prior to such
date. All distributions will be made in accordance with Code Section
401(a)(9), the regulations promulgated under Code Section 401(a)(9),
including Treasury Regulation Section 1.401(a)(9)-2 (relating to
incidental benefit limitations) and any other provisions reflecting the
requirements of Code Section 401(a)(9) and prescribed by the Internal
Revenue Service; and the terms of the Plan reflecting the requirements of
Code Section 401(a)(9) override the distribution options (if any) in the
Plan which are inconsistent with those requirements.
(c) Restrictions on Distributions from Before Tax and
Supplemental Accounts. Notwithstanding anything in the Plan to the contrary,
(i) amounts in a Participant's Before Tax and Supplemental Accounts, and (ii)
amounts in a Participant's Transfer Accounts credited with before tax
contributions, matching and company contributions used to satisfy the Code
Section 401(k) actual deferral percentage test and company contributions used
to satisfy the Code Section 401(m) average contribution percentage test, shall
not be distributable to such Participant earlier than the earliest of the
following to occur:
(1) The Participant's death, Disability or separation from
service with all Affiliates;
(2) The termination of the Plan without the establishment
or maintenance of a successor defined contribution plan [other than an
employee stock ownership plan as defined in Code Section 4975(e)] at the
time the Plan is terminated or within the period ending 12 months after
the final distribution of all assets in all Before Tax, Supplemental and
Transfer Accounts described above in this subsection (c); provided, if
fewer than 2 percent of the Employees who are or were eligible under the
Plan at the time of its termination are or were eligible under another
defined contribution plan at any time during the 24 month period
beginning 12 months before the time of termination, such other plan shall
not be a successor plan;
(3) The date of disposition by the Participating Company
employing such Participant of substantially all of its assets [within the
meaning of Code Section 409(d)(2)] that were used by such Participating
Company in a trade or business; provided, such Participant continues
employment with the corporation acquiring such assets. The sale of 85
percent of the assets used in a trade or business will be deemed a sale
of "substantially all" of the assets used in such trade or business;
(4) The date of disposition by the Participating Company
employing such Participant of its interest in a subsidiary [within the
meaning of Code Section 409(d)(3)]; provided, such Participant continues
employment with such subsidiary;
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(5) The attainment by such Participant of age 59 1/2; or
(6) The Participant's incurrence of a financial hardship
as described in Section 10.6;
provided, for an event described in subsections (c)(2), (c)(3) or (c)(4)
hereof to constitute events permitting a distribution from the Before Tax
and Supplemental Accounts (or the affected Transfer Accounts), such
distribution must be made on account of such event in the form of a lump
sum distribution, as defined in Code Section 402(d)(4) (without regard to
clauses (i), (ii), (iii) and (iv) of subparagraph (A), or subparagraphs
(B) and (F) thereof); and provided, further, for the events described in
subsections (c)(3) or (c)(4) hereof to constitute events permitting such
a distribution, the Participating Company must maintain the Plan after
the disposition.
(d) Discontinuance Upon Reemployment or Termination of
Disability. If a Participant becomes eligible to receive or begins receiving
benefit payments in accordance with the terms of this Article X and
subsequently is reemployed by an Affiliate (or ceases to be Disabled, as
applicable) prior to the time his Account has been distributed in full, all
distributions to such Participant shall be delayed or cease until such
Participant again becomes eligible to receive distributions from the Plan
pursuant to the terms of this or any other section of the Plan.
Notwithstanding the foregoing, if a Participant's benefit payments have
commenced in the form of installment payments for which an annuity contract has
been purchased, payments under such annuity contract shall not cease but shall
continue during the period of his reemployment.
10.2 Death Benefits.
(a) Prior to Benefit Commencement Date. Subject to the
requirements of Section 7.9, if a Participant dies before payment of his
benefits from the Plan is made or commenced, the Beneficiary or Beneficiaries
designated by such Participant in his latest beneficiary designation form filed
with the Administrative Committee in accordance with the terms of Section 10.4
shall be entitled to receive a distribution of the total of (i) the entire
vested amount credited to such Participant's Account, determined as of the
Valuation Date coincident with or immediately preceding the date payment of
such distribution is to be made or commenced (or, if daily Valuation Dates are
elected in Section 2.1(d) of the Adoption Agreement, the Valuation Date on
which such distribution is processed), plus (ii) any Contributions made on such
Participant's behalf since such Valuation Date. For purposes of this
subsection, the "date payment of such distribution is to be made or commenced"
refers to the date established for such purpose by administrative practice,
even if actual payment is made or commenced at a later date due to delays in
the valuation, administrative or any other procedure. Benefits shall be
distributed, or shall commence to be distributed, to such Beneficiary or
Beneficiaries within 90 days after the date of the Participant's death (or, if
later, after timing restrictions and requirements under the Code are
satisfied). As required by Code Section 401(a)(9), in no event shall any such
distribution be made later than 5 years after the date of his death. The
Administrative Committee may direct the Trustee to distribute a Participant's
Account to a Beneficiary without the written consent of such Beneficiary.
(b) After Benefit Commencement Date. If a Participant dies
after payment of his vested benefits from the Plan has begun but before his
entire vested benefit is distributed, the remainder of his benefits shall be
paid to his Beneficiary pursuant to a method selected by the Beneficiary in
accordance with the terms of Section 10.3.
10.3 Form of Distribution.
(a) Single Sum Payment. Unless subsection (b) hereof applies,
the payment of any distribution from the Plan to a Participant or Beneficiary
shall be in the form of a single sum payment.
(b) Optional Methods of Payment. If the Adopting Company elects
in Section 10.2 of the Adoption Agreement to allow the Participant or his
Beneficiary to elect optional forms of distribution, the method pursuant to
which a Participant's or Beneficiary's benefits under the Plan shall be
distributed shall be determined as follows:
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(1) Except as provided in subsection (b)(2) and subsection
(b)(3) hereof, the payment of any distribution to a Participant or his
Beneficiary from the Plan shall be in the form selected by the
Participant or his Beneficiary, by written notice delivered to the
Administrative Committee, all in accordance with the terms of this
subsection (b)(1) and subsections (b)(4) - (b)(8) hereof. The
Participant or Beneficiary may choose one of the following methods of
payment:
a) A single-sum payment,
b) Periodic installments (either monthly,
quarterly, semiannually or annually) for a
period not to exceed the period provided in
subsection (4) hereof; provided, no periodic
payment arrangement shall result in payments of
less than $50.00 per period. The amount
distributed in each year shall be determined by
dividing the vested amount of the Participant's'
Account balance as of the preceding valuation
date by the number of distributions remaining;
or
c) Periodic equal installments (either monthly,
quarterly, semiannually or annually, but not
less than $50 per period) payable until the
vested amount of the Participant's Account
Balance is completely distributed. The annual
amount of each installment payment shall not be
less than 10 percent of the vested amount of the
Participant's Account balance as of the date of
distribution, and no installment arrangement may
provide for payments extending beyond the period
provided in subsection (4) hereof.
(2) If the total vested amount of a Participant's Account
balance is less than or equal to $3,500 at the time and at any time
before the distribution of such Account commences, payment of the vested
amount of such Account shall be made in the form of a single sum payment,
without the consent of the Participant or Beneficiary.
(3) If a Participant designates more than one Beneficiary
to receive payment of his benefit upon his death, the Participant [and
his Beneficiaries] shall be deemed to have selected a single sum payment
as the form of benefit distribution.
(4) If a Participant selects payment in the form of
installments over a term certain, the maximum length thereof shall be the
joint life expectancy of such Participant and his designated Beneficiary.
The initial value of the obligation for the installment payments shall be
equal to the vested amount of the Participant's Account balance on the
day payments are scheduled to commence. Notwithstanding anything herein
to the contrary, distributions from the Plan must satisfy the
requirements of Code Section 401(a)(9)(G). This means that (i) for
calendar years beginning before January 1, 1989, the present value of the
installment payments to be made to such Participant (in the event of his
retirement or Disability) must exceed 50 percent of the present value of
the total payments to be made to such Participant and his Beneficiary;
and, (ii) for calendar years beginning after December 31, 1988, the
incidental benefit rules as described in Treasury Regulation Section
1.401(a)(9)-2 shall be satisfied.
(5) If a Participant dies before payment of his benefits
from the Plan is made or commenced and his Beneficiary elects payment in
the form of installments over a term certain and the Beneficiary is an
individual, the maximum length of the term certain shall be the life
expectancy of such Beneficiary, and if the Beneficiary is not an
individual (for example, an estate or trust), the maximum length of the
term certain shall be 5 years.
(6) If a Participant dies after payment of his benefits
from the Plan has begun but before his entire benefit has been
distributed, his Beneficiary may elect to receive the remainder of the
deceased Participant's Account in the form of a single sum payment or to
continue to receive the same installment payments which would have been
paid to the deceased Participant if he had survived.
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(7) If a Beneficiary who has begun receiving installment
payments pursuant to the terms of this subsection dies prior to the full
payment thereof, the remaining vested amount of the Account balance shall
be distributed to the designated beneficiary of such Beneficiary or, if
no such beneficiary has been designated or survives, to the estate of
such Beneficiary.
(8) If a distribution is to be made to a Participant
and/or his Spouse Beneficiary in the form of installments payable over
the life expectancy or joint life expectancy of such persons, the life
expectancy or joint life expectancy, as applicable, of such persons shall
be calculated at the time distributions commence and shall not thereafter
be recalculated, unless the Participant makes an irrevocable election
prior to the time his benefit payments are scheduled to begin, to have
the life expectancy or joint life expectancy, as applicable, recalculated
annually.
(c) Assets Distributed. Any distribution to a Participant or
his Beneficiary or Beneficiaries shall be made in the form of cash.
(d) Effect of Outstanding Loans. If an amount becomes payable
to a Participant (or his Beneficiary) pursuant to either Section 10.1 or
Section 10.2 at a time when such Participant has an outstanding loan from the
Plan, the terms of Section 10.9(h) shall apply.
(e) Direct Rollover Distributions. If (i) a Participant, (ii)
his Spouse who is his Beneficiary, or (iii) his Spouse or former Spouse who is
the alternate payee under a qualified domestic relations order, as defined in
Code Section 414(p), who is the recipient of any Eligible Rollover
Distribution, elects to have such Eligible Rollover Distribution paid directly
to an Eligible Retirement Plan and specifies (in such form and at such time as
the Administrative Committee may prescribe) the Eligible Retirement Plan to
which such distribution is to be paid, such distribution shall be made in the
form of a direct trustee-to-trustee transfer to the specified Eligible
Retirement Plan; provided, such transfer shall be made only to the extent that
the Eligible Rollover Distribution would be included in gross income if not so
transferred [determined without regard to Code Section 402(c) and Section
403(a)(4)].
(f) Payment of Amounts Invested in Company Stock Trust Fund. In
the event of a distribution to a Participant whose Accounts are invested in the
Company Stock Trust Fund, the Company Stock Trustee shall liquidate the shares
of Company Stock allocated to such Accounts and shall transfer cash
representing the value of such shares to the Master Trust Fund, and the Master
Trustee shall pay such amounts to such Participant, Joint Annuitant or
Beneficiary together with other distributions from the Master Trust Fund.
10.4 Beneficiary Designation.
(a) General. Participants shall designate and from time to time
may redesignate their Beneficiary or Beneficiaries in such form and manner as
the Administrative Committee may determine. A Participant shall be deemed to
have named his Spouse, if any, as his sole Beneficiary unless his Spouse
consents to the payment of all or a specified portion of the Participant's
death benefit to a Beneficiary other than or in addition to the Spouse in a
manner satisfying the requirements of a Qualified Spousal Waiver and such other
procedures as the Administrative Committee may establish. Notwithstanding the
foregoing, a married Participant may designate a nonspouse Beneficiary without
a Qualified Spousal Waiver if the Participant establishes to the satisfaction
of the Administrative Committee that a Qualified Spousal Waiver may not be
obtained because his Spouse cannot be located or such other permissible
circumstances exist as the Secretary of the Treasury may prescribe by
regulation. If any Participant dies prior to receiving his benefits under the
Plan, his Account shall be changed to the name of such deceased Participant's
named or deemed Beneficiary or Beneficiaries.
(b) No Designation or Designee Dead or Missing. In the event
that:
(1) a Participant dies without designating a Beneficiary;
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(2) the Beneficiary designated by a Participant is not
surviving when a payment is to be made to such person under the Plan, and
no contingent Beneficiary has been designated; or
(3) the Beneficiary designated by a Participant cannot be
located by the Administrative Committee within 1 year from the date
benefits are to commence to such person;
then, in any of such events, the Beneficiary of such Participant with respect
to any benefits that remain payable under the Plan shall be the Participant's
Surviving Spouse, if any, and if not, then the estate of the Participant.
10.5 Qualified Domestic Relations Orders.
In the event the Administrative Committee receives a domestic
relations order which it determines to be a qualified domestic relations order
("QDRO") [see Section 16.1(b)], the Plan shall pay such benefit to the
prescribed alternate payee(s) at such time and in such form, as shall be
described in the QDRO and permitted under Section 16.1(b). If the QDRO
requires immediate payment, the specified benefit shall be paid to the
alternate payee as soon as practicable following the end of the month within
which the Administrative Committee determines that the order is qualified or,
if later, after timing restrictions and requirements under the Code are
satisfied. To the extent consistent with the QDRO, the amount of the payment
to an alternate payee shall include earnings, interest and other investment
proceeds through (but not after) the Valuation Date as of which the Trustee
processes the distribution. If a Participant's Account is partially paid or
payable to an alternate payee, the Participant's remaining portion of his
Account shall be reduced accordingly and shall be subject to the distribution
provisions in this Article X.
10.6 Hardship Withdrawals.
(a) Parameters of Hardship Withdrawals. If elected by the
Adopting Company pursuant to Section 10.3 of the Adoption Agreement, a
Participant may make a withdrawal from his vested Account [other than (i) his
Supplemental Account or Transfer Accounts described in Section 10.1(c), and
(ii) any investment earnings attributable to Before Tax Contributions and
earned after December 31, 1988] on account of hardship. For purposes of this
subsection, a withdrawal will be on account of "hardship" if it is necessary to
satisfy an immediate and heavy financial need of the Participant. A withdrawal
based on financial hardship cannot exceed the amount necessary to meet the
immediate financial need created by the hardship and not reasonably available
from other resources of the Participant. The Administrative Committee shall
make its determination, as to whether a Participant has suffered an immediate
and heavy financial need and whether it is necessary to use a hardship
withdrawal from the Plan to satisfy that need, on the basis of all relevant
facts and circumstances. The Administrative Committee shall also establish the
minimum amount that may be withdrawn.
(b) Immediate and Heavy Financial Need. For purposes of the
Plan, an immediate and heavy financial need exists if the withdrawal is on
account of (i) expenses for medical care described in Code Section 213(d)
previously incurred by the Participant, his Spouse or dependents, or necessary
to obtain such medical care for such persons, (ii) the purchase (excluding
mortgage payments) of a principal residence for the Participant, (iii) the
payment of tuition and related educational fees for the next 12 months of
post-secondary education for the Participant, his Spouse or dependents, or (iv)
the need to prevent eviction of the Participant from his principal residence or
foreclosure on the mortgage of the Participant's principal residence.
(c) Necessary to Satisfy a Financial Need. A withdrawal will be
considered as necessary to satisfy an immediate and heavy financial need of a
Participant only if (i) the Participant has obtained all distributions, other
than hardship withdrawals, and all nontaxable loans under all plans maintained
by the Participating Company and its Affiliates; (ii) all plans maintained by
the Participating Company and its Affiliates provide that the Participant's
Before Tax and After Tax Contributions will be suspended for a 12-month period,
beginning with the month following the month of receipt of the hardship
withdrawal; (iii) the withdrawal is not in excess of the amount of the
Participant's immediate and heavy financial need; and (iv) all plans maintained
by the Participating Company and its Affiliates provide that the employee may
not make Before Tax Contributions for his taxable year immediately following
the
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taxable year of the hardship withdrawal in excess of the Maximum Deferral
Amount for such taxable year less the amount of his Before Tax Contributions
for the taxable year of the hardship withdrawal. The amount of an immediate
and heavy financial need may include amounts necessary for the Participant to
pay any federal, state or local taxes which are reasonably anticipated to
result from the hardship withdrawal.
(d) Election to Withdraw. All applications for hardship
withdrawals shall be in writing on a form provided by the Administrative
Committee and shall contain such information as the Administrative Committee
may reasonably request.
(e) Payment of Withdrawal. The amount of a hardship withdrawal
shall be paid to a Participant in a single sum as soon as practicable after the
Administrative Committee approves the withdrawal application or, if later,
after timing restrictions and requirements under the Code are satisfied.
(f) Effect of Outstanding Loans. If an amount becomes payable
to a Participant pursuant to this Section at a time when such Participant has
an outstanding loan from the Plan, the terms of Section 10.9(h) shall apply.
10.7 Withdrawals from After Tax and Voluntary Accounts.
(a) Election to Withdraw. If elected by the Adopting Company
pursuant to Section 10.4 of the Adoption Agreement, a Participant may elect to
withdraw all or a part of the value of his After Tax Account, his Voluntary
Account and any Transfer Account credited with after tax contributions while he
is an employee of an Affiliate. Such election must be made in a writing,
executed by the Participant and delivered to the Administrative Committee at
such time prior to the desired withdrawal date as the Administrative Committee
may require.
(b) Payment of Withdrawal. The amount of each withdrawal shall
be paid to a Participant in a single sum as soon as practicable after the
Administrative Committee receives his withdrawal election.
(c) Effect of Outstanding Loans. If an amount becomes payable
to a Participant pursuant to this Section at a time when such Participant has
an outstanding loan from the Plan, the terms of Section 10.9(h) shall apply.
10.8 Distributions and Withdrawals from Transfer Accounts.
If the assets and benefits of a qualified retirement plan, which
(i) allows Code Section 411(d)(6) protected in-service withdrawals (other than
those permitted in Section Section 10.6, 10.7 and 10.8) and/or (ii) allows one
or more Code Section 411(d)(6) protected forms of distribution not generally
permitted hereunder, are transferred to or merged into the Plan, the
Participants who have Transfer Accounts reflecting the accrued benefits under
that prior plan shall be permitted to withdraw and/or receive distributions of,
all or a portion of the amounts from their Transfer Accounts in a manner and
subject to rules and restrictions, similar to those provided under the prior
plan such that the Plan will comply with the requirements of Code Section
411(d)(6).
10.9 Loans to Participants.
(a) Grant of Authority. If elected by the Adopting Company
pursuant to Section 10.5 of the Adoption Agreement, loans to Participants and
Beneficiaries generally shall be allowed; provided, if the Administrative
Committee determines in its sole discretion that it is not administratively
feasible or desirable to make such loans during any period of time, no loans
shall be made during such period; and, provided further, no loan shall be
permitted or made to any person who is (i) an owner-employee, as defined in
Section 7.8(e), (ii) a more than 5-percent shareholder employee of an
S-corporation that is an Affiliate, or (iii) any family member or affiliated
company with respect to any of the persons described in clauses (i) or (ii)
hereof, all as more fully described in ERISA Section 408(d). Subject to the
limitations set forth in this Section and to such uniform and nondiscriminatory
rules as may from time to time be adopted by the Administrative Committee, the
Trustee may make a loan or loans to the borrower, as approved by the
Administrative Committee. A Participant or Beneficiary may obtain loan
application forms from the
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Administrative Committee and return such forms completed to the Administrative
Committee for approval. The Administrative Committee shall administer the loan
program. The terms of this Section shall apply to all loans made or renewed on
or after October 19, 1989, and the terms of the Plan in effect prior to the
Effective Date shall apply to all loans made or renewed prior to that date.
(b) Nondiscriminatory Policy. Loans shall be available to all
Participants and Beneficiaries on a reasonably equivalent basis, without regard
to an individual's race, color, religion, age, sex or national origin;
provided, the Administrative Committee may provide for different treatment of
Participants who are active employees of Affiliates and Participants and
Beneficiaries who are not, as long as that different treatment is based on
valid economic differences which may exist between these two groups and which
commercial lenders in the business of making similar types of loans legally
recognize for purposes of loan availability. Loans shall not be made available
to borrowers who are Highly Compensated Employees in an amount greater than the
amount available to other borrowers; provided, this limitation shall be
interpreted to mean that, subject to the other limitations in this Section, the
same percentage of each Participant's and Beneficiary's vested Account balance
may be loaned to each such borrower regardless of the actual amount of his
vested Account balance.
(c) Approval of Loans. The Administrative Committee shall
approve a loan for a Participant or Beneficiary; provided, (i) the Participant
or Beneficiary submits properly completed loan application documents, (ii) the
Administrative Committee determines that it is administratively feasible to
make loans at such time, (iii) the amount of loan requested does not exceed the
amount of vested Account balance available to secure the loan, and (iv) the
Participant or Beneficiary does not have a loan outstanding.
(d) Minimum Loan Amount. The minimum amount of any loan shall
be $1,000.
(e) Maximum Loan Amount. No Participant or Beneficiary may have
more than one loan outstanding at any time. In addition, no loan may be made
to any Participant or Beneficiary from the Plan if the amount of such loan
exceeds the lesser of:
(1) $50,000 minus the highest aggregate principal balance,
outstanding during the year ending on the day before such loan is made,
of all loans made to the Participant or Beneficiary by the qualified
employer plans [as defined in Code Section 72(p)(4)(A)] maintained by the
Affiliates; or
(2) the difference between (A) 50 percent of the
Participant's or Beneficiary's total vested interest in the Plan and all
other qualified employer plans maintained by the Affiliates, minus (B)
the total amount of all loans outstanding on the date the loan is made
from all qualified employer plans maintained by the Affiliates.
Notwithstanding anything herein to the contrary, in no event shall the amount
of a loan made to a Participant or Beneficiary from the Plan exceed 50 percent
of such Participant's or Beneficiary's vested Account balance immediately after
the origination of the loan.
(f) Maximum Loan Term.
(1) Except as provided in subsection (f)(2) hereof, the
terms of any loan made to a Participant or Beneficiary from the Plan
shall require that the full amount of the loan be repaid within the
5-year period commencing on the date the loan is made, and in no event
shall the repayment period of the loan subsequently be extended beyond
such 5-year period. The Trustee shall make a diligent effort to collect
the full amount of the loan within this specified repayment period and
shall inform the borrower that, in the event the loan is not fully repaid
within the 5-year period, the borrower will be treated as having received
a taxable distribution from the Plan.
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(2) The 5-year repayment rule set forth in subsection
(f)(1) hereof shall not apply to the extent that a loan to a Participant
or Beneficiary from the Plan is used to acquire any dwelling unit which
is used, or within a reasonable time is to be used, as a principal
residence of the borrower. Whether a dwelling unit is to be used within
a reasonable time as a principal residence is to be determined by the
Administrative Committee at the time the loan is made, and the
Administrative Committee may require such written statements and other
evidence from the borrower as it deems necessary to make this
determination. Loans made with respect to principal residences pursuant
to this subsection generally shall have a repayment period that the
Administrative Committee determines is appropriate taking into account
circumstances which commercial lenders would consider relevant, but in no
event shall the term of the loan exceed 10 years. The Trustee, with the
consent of the Administrative Committee, may extend or renew such loans
if the conditions qualifying the Participant or Beneficiary for the
initial loan continue beyond the loan due date; provided, such extensions
and renewals shall be treated as the making of new loans under this
Section and shall satisfy the maximum loan amounts and other limitations
and requirements set forth in this Section.
(g) Terms of Repayment. All loans to Participants and
Beneficiaries made by the Trustee shall be subject to a definite repayment
schedule which requires substantially level amortization over the term of the
loan with payments to be made not less frequently than quarterly (and more
frequently if required by the Administrative Committee's policy regarding Plan
loans). Payments shall be made by Participants who are employees of Affiliates
on a payroll deduction basis, and payments from other Participants and from
Beneficiaries shall be made by cash, check or other cash equivalent.
(h) Adequacy of Security. All loans to Participants and
Beneficiaries made by the Trustee shall be secured by the pledge of a dollar
amount of the borrower's Account balance which is equal to 50 percent of the
borrower's Account balance immediately after the origination of the loan or, if
lesser, the amount of the loan. Notwithstanding anything herein to the
contrary, the pledge of such security shall be made in such manner and amount
as the Administrative Committee may require for the loan to be considered
adequately secured. A loan will be considered to be "adequately secured" (i)
if the security posted for such loan is in addition to and supporting a promise
to pay, (ii) if it is pledged in a manner such that it may be sold, foreclosed
upon, or otherwise disposed of upon default of repayment of the loan, and (iii)
if the value and liquidity of that security is such that it may reasonably be
anticipated that loss of principal or interest will not result from the loan.
The adequacy of such security will be determined in light of the type and
amount of security which would be required in the case of an otherwise
identical transaction in a normal commercial setting between unrelated parties
on arm's-length terms. During the period that a loan is outstanding, if a
Participant becomes eligible to receive a hardship or After Tax withdrawal or a
distribution, the amount of such Participant's Account which he shall be
eligible to receive through withdrawal or distribution shall not exceed that
amount which will reduce by more than 50 percent such Participant's Account
balance, excluding all outstanding loan amounts. Should a withdrawal or
distribution reduce the Account balance by more than 50 percent, the withdrawal
or distribution shall first be applied to reduce such loan amount, and, once
the loan is repaid in full, any excess amount may be distributed to such
Participant (or his Beneficiary).
(i) Rate of Interest. A loan from the Plan to a Participant or
a Beneficiary must bear a reasonable rate of interest. A loan will be
considered to bear "a reasonable rate of interest" if such loan provides the
Plan with a return commensurate with interest rates charged by persons in the
business of lending money for loans which would be made under similar
circumstances. The Administrative Committee's decision as to the rate of
interest for any Plan loan shall be based primarily on the rate of interest
that one or more local banks would charge on a similar loan, taking into
account, among other things, the collateral pledged to secure the loan.
(j) Source of Loan Amounts. The proceeds of a loan shall be
charged against the subaccounts of the borrower in the same proportion as the
balance of each such subaccount bears to the total balance of his entire
Account.
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(k) Crediting Loan Payments to Accounts. The loan shall be
considered a directed investment of the borrower and any principal and interest
paid on the loan shall be considered a part of his total Account. Each payment
of principal and interest shall be credited to the borrower's subaccounts as
provided in the Loan Policy Statement.
(l) Remedies in the Event of Default. If any loan payments are
not paid as and when due or within 30 days after such due date, the
Administrative Committee may declare the loan to be in default. The
Administrative Committee may take such actions, as it deems appropriate, to
allow the borrower to cure such default or to otherwise collect such overdue
payments or, as the case may be, the outstanding balance of the loan. Among
other things, the Administrative Committee's actions may include causing all or
any portion of the borrower's Account which has been pledged to secure the loan
to be used to repay such loan; provided, although the Administrative Committee
may treat any portion of the loan balance that remains outstanding after a
default as taxable income to the borrower in accordance with the terms of Code
Section 72(p), no portion of such outstanding loan balance may be treated as a
reduction of a Participant's Account balance until such time as such reduction,
if treated as a distribution, will not breach the restrictions of Section
10.1(c). In the unlikely event that default by a Participant who is currently
employed occurs, foreclosure may be delayed until the borrower ceases to be an
employee, if such delay is necessary to maintain the qualified status of the
Plan; provided, such a delay must not jeopardize the Plan's ability to collect
the full amount of principal and interest due under the loan.
10.10 Unclaimed Benefits.
In the event a Participant becomes entitled to benefits under the
Plan other than death benefits and the Administrative Committee is unable to
locate such Participant (after sending a letter, return receipt requested, to
the Participant's last known address, and after such further diligent efforts
as the Administrative Committee in its sole discretion deems appropriate)
within 1 year from the date upon which he becomes so entitled, the
Administrative Committee shall direct that such benefits be paid to the
Beneficiary of such Participant; provided, if the distribution is payable upon
the termination of the Plan, the Administrative Committee shall not be required
to wait until the end of such 1-year period. If the Participant and the
Beneficiary cannot be located and fail to claim such benefits by the end of the
fifth Plan Year following the Plan Year in which such Participant becomes
entitled to such benefits, then the full Account of the Participant shall be
deemed abandoned and treated as a Forfeiture; provided, in the event such
Participant or Beneficiary is located or makes a claim subsequent to the
allocation of the abandoned Account, the amount of the abandoned Account
(unadjusted for any investment gains or losses from the time of abandonment)
shall be restored (from abandoned Accounts, Forfeitures, Trust earnings or
Contributions made by the Participating Companies) and paid to such Participant
or Beneficiary, as appropriate; and, provided further, the Administrative
Committee, in its sole discretion, may delay the deemed date of abandonment of
any such Account for a period longer than the prescribed five Plan Years if it
believes that it is in the best interest of the Plan to do so.
10.11 Claims.
(a) Procedure. Claims for benefits under the Plan may be filed
with the Administrative Committee on forms supplied by the Administrative
Committee. The Administrative Committee shall furnish to the claimant written
notice of the disposition of a claim within 90 days after the application
therefor is filed; provided, if special circumstances require an extension of
time for processing the claim, the Administrative Committee shall furnish
written notice of the extension to the claimant prior to the end of the initial
90-day period, and such extension shall not exceed one additional, consecutive
90-day period. In the event the claim is denied, the notice of the disposition
of the claim shall provide the specific reasons for the denial, cites of the
pertinent provisions of the Plan, and, where appropriate, an explanation as to
how the claimant can perfect the claim and/or submit the claim for review.
(b) Review Procedure. Any Participant or Beneficiary who has
been denied a benefit, or his duly authorized representative, shall be
entitled, upon request to the Administrative Committee, to appeal the denial of
his claim. To do so, the claimant must obtain a form from the Administrative
Committee on which to request further consideration of his position. The
claimant, or his duly authorized representative, may review pertinent documents
related to the Plan and in the Administrative Committee's possession in order
to prepare the appeal. The form
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containing the request for review, together with a written statement of the
claimant's position, must be filed with the Administrative Committee no later
than 60 days after receipt of the written notification of denial of a claim
provided for in subsection (a). The Administrative Committee's decision shall
be made within 60 days following the filing of the request for review and shall
be communicated in writing to the claimant; provided, if special circumstances
require an extension of time for processing the appeal, the Administrative
Committee shall furnish written notice to the claimant prior to the end of the
initial 60-day period, and such extension shall not exceed one additional
60-day period. If unfavorable, the notice of decision shall explain the reason
or reasons for denial and indicate the provisions of the Plan or other
documents used to arrive at the decision.
(c) Satisfaction of Claims. Any payment to a Participant or
Beneficiary or to their legal representative or heirs at law, all in accordance
with the provisions of the Plan, shall to the extent thereof be in full
satisfaction of all claims hereunder against the Trustee, the Administrative
Committee and the Adopting Company, any of whom may require such Participant,
Beneficiary, legal representative or heirs at law, as a condition to such
payment, to execute a receipt and release therefor in such form as shall be
determined by the Trustee, the Administrative Committee or the Adopting
Company, as the case may be. If receipt and release shall be required but
execution by such Participant, Beneficiary, legal representative or heirs at
law shall not be accomplished so that the terms of Section 10.1(b), Section
10.2 and Section 10.3 (dealing with the timing of distributions) may be
fulfilled, such benefits may be distributed or paid into any appropriate court
or to such other place as such court shall direct, for disposition in
accordance with the order of such court, and such distribution shall be deemed
to comply with the requirements of Section 10.1(b), Section 10.2 and Section
10.3.
10.12 Explanation of Rollover Distributions.
Within a reasonable period of time [as defined for purposes of
Code Section 402(f)] before making an Eligible Rollover Distribution from the
Plan to a Participant or Beneficiary, the Administrative Committee shall
provide such Participant or Beneficiary with a written explanation of (i) the
provisions under which the distributee may have the distribution directly
transferred to another Eligible Retirement Plan, (ii) the provisions which
require the withholding of tax on the distribution if it is not directly
transferred to another Eligible Retirement Plan, (iii) the provisions under
which the distribution will not be subject to tax if transferred to an Eligible
Retirement Plan within 60 days after the date on which the distributee receives
the distribution, and (iv) such other terms and provisions as may be required
under Code Section 402(f) and the regulations promulgated thereunder.
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ARTICLE XI
PAYMENT OF BENEFITS WITH ANNUITY PROVISIONS
This Article XI shall apply only if elected by the Adopting Company pursuant to
Section 11.1 of the Adoption Agreement. (Article X and Article XI are mutually
exclusive; only one can be elected in the Adoption Agreement, and only one can
apply; provided, notwithstanding that the Adopting Company elects Article X as
the general distribution rules, if the Plan is a transferee plan with respect
to any accounts that provide for a life annuity form of distribution, such that
the exception to the requirements of Code Section 401(a)(11) [set forth in Code
Section 401(a)(11)(B)(iii)] is not applicable, the distribution provisions of
this Article XI shall apply but only to the extent required under Code Section
411(d)(6) and Code Section 401(a)(11) with respect to such Transfer Accounts
(see Section 11.1 of the Adoption Agreement).
11.1 Benefits Payable Upon Separation From Service For Reasons Other
Than Death
(a) General Rule Concerning Benefits Payable. Subject to the
requirements of Section 7.9 and in accordance with the terms of subsection (b)
hereof and subject to the restrictions set forth in subsections (c) and (d)
hereof, if a Participant separates from service with all Affiliates for any
reason other than death, or if a Participant becomes Disabled but remains an
employee of an Affiliate, he shall be entitled to receive or begin receiving a
distribution of (i) the vested amount credited to his Account, determined as of
the Valuation Date coincident with or immediately preceding the date payment of
such distribution is to be made or commenced (or, if daily Valuation Dates are
elected in Section 2.1(d) of the Adoption Agreement, the Valuation Date on
which such distribution is processed), plus (ii) the vested amount of any
Contributions made on his behalf since such Valuation Date. For purposes of
this subsection, the "date payment of such distribution is to be made" refers
to the date established for such purpose by administrative practice even if
actual payment is made at a later date due to delays in the valuation,
administrative or any other procedure.
(b) Timing of Distribution.
(1) Except as provided in subsections (b)(2), (b)(3) and
(d) hereof and Section 11.5, benefits payable to a Participant under this
Section shall be distributed, or shall commence to be distributed, as
soon as administratively feasible after such Participant becomes Disabled
or separates from service with all Affiliates for any reason other than
death. The Participant's Benefit Commencement Date under this subsection
(b)(1) shall be the first day of the month coincident with or immediately
following the date he becomes Disabled or he separates from service. Any
payments that do not actually begin on the date as of which payment is
scheduled to commence under this Article shall be adjusted so that the
first payment includes all amounts due through the date of such payment.
(2) Notwithstanding the foregoing, in the event that (A)
the value of the Participant's Account exceeds (or at any time prior to
distribution exceeded) $3,500 and (B) the Benefit Commencement Date
described in subsection (b)(1) hereof occurs or is to occur prior to the
Participant's Normal Retirement Age, benefits shall not be distributed
(or commence to be distributed) to such Participant at the time set forth
in subsection (b)(1) hereof without the Participant's written election,
on a form provided by the Administrative Committee; provided, failure to
consent shall be deemed an election to defer; and provided further, no
consent shall be required to make a distribution required to satisfy Code
Section 401(a)(9) or Section 415. In order for such Participant's
election to be valid, he must actually separate from service or he must
become Disabled on or before his selected Benefit Commencement Date, his
election must be filed with the Administrative Committee within the
90-day period ending on such date, and the Administrative Committee (no
later than 30 days and no earlier than 90 days before his Benefit
Commencement Date) must have presented him with a notice describing the
material features and an explanation of the relative values of the
optional forms of benefit in a manner that satisfies the requirements of
Code Section 417(a)(3) and informing him of his right to defer his
distribution. If the Participant does not consent in writing to the
distribution (or commencement of his distribution) of his benefit
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at such time, then, unless the Participant elects to further defer
distribution of his benefit and the Participant makes such an election in
writing, his benefit shall be distributed (or commence to be distributed)
as soon as practicable after he files a written election with the
Administrative Committee requesting such payment. If a Participant fails
to file a written election specifying the time of payment, his benefit
shall be distributed (or commence to be distributed) as soon as
administratively feasible after the end of the Plan Year in which he
attains Normal Retirement Age, but in no event later than the 60th day
after the end of such Plan Year; provided, if the amount of payment
cannot be ascertained by such date, payment shall be made (or commence)
no later than 60 days after the earliest date on which such payment can
be ascertained under the Plan. A Participant's Benefit Commencement Date
under this subsection (b)(2) shall be the date as of which benefits are
scheduled to begin hereunder.
(3) Notwithstanding anything in the Plan to the contrary,
in no event shall payment of a Participant's benefit commence (or be
made), retroactive to such date, later than 60 days after the end of the
Plan Year which includes the latest of (i) the date on which the
Participant attained Normal Retirement Age, (ii) the date which is the
10th anniversary of the date he commenced participation in the Plan, or
(iii) the date he actually separates from service with all Affiliates;
provided, if the amount of the payment cannot be ascertained by the date
as of which payments are scheduled to be made (or commence) hereunder,
payment shall be made (or commence) no later than 60 days after the
earliest date on which such payment can be ascertained under the Plan;
and, provided further, the Participant's benefit payments shall be made
(or commence) no later than the April 1 following the calendar year in
which the Participant attains age 70 1/2 without regard to whether he has
actually separated from service with all Affiliates prior to such date.
All distributions will be made in accordance with Code Section 401(a)(9),
the regulations promulgated under Code Section 401(a)(9), including
Treasury Regulation Section 1.401(a)(9)-2 (relating to incidental benefit
limitations) and any other provisions reflecting the requirements of Code
Section 401(a)(9) and prescribed by the Internal Revenue Service; and the
terms of the Plan reflecting the requirements of Code Section 401(a)(9)
override the distribution options (if any) in the Plan which are
inconsistent with those requirements.
(c) Restrictions on Distributions from Before Tax and
Supplemental Accounts. Notwithstanding anything in the Plan to the contrary,
(i) amounts in a Participant's Before Tax and Supplemental Accounts, and (ii)
amounts in a Participant's Transfer Accounts credited with before tax
contributions, matching and company contributions used to satisfy the Code
Section 401(k) actual deferral percentage test and company contributions used
to satisfy the Code Section 401(m) average contribution percentage test, shall
not be distributable to such Participant earlier than the earliest of the
following to occur:
(1) The Participant's death, Disability or separation from
service with all Affiliates;
(2) The termination of the Plan without the establishment
or maintenance of a successor defined contribution plan [other than an
employee stock ownership plan as defined in Code Section 4975(e)] at the
time the Plan is terminated or within the period ending 12 months after
the final distribution of all assets in all Before Tax, Supplemental and
Transfer Accounts described above in this subsection (c); provided, if
fewer than 2 percent of the Employees who are or were eligible under the
Plan at the time of its termination are or were eligible under another
defined contribution plan at any time during the 24 month period
beginning 12 months before the time of termination, such other plan shall
not be a successor plan;
(3) The date of disposition by the Participating Company
employing such Participant of substantially all of its assets [within the
meaning of Code Section 409(d)(2)] that were used by such Participating
Company in a trade or business; provided, such Participant continues
employment with the corporation acquiring such assets. The sale of 85
percent of the assets used in a trade or business will be deemed a sale
of "substantially all" of the assets used in such trade or business;
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(4) The date of disposition by the Participating Company
employing such Participant of its interest in a subsidiary [within the
meaning of Code Section 409(d)(3)]; provided, such Participant continues
employment with such subsidiary;
(5) The attainment by such Participant of age 59-1/2; or
(6) The Participant's incurrence of a financial hardship
as described in Section 11.9; provided, for an event described in subsections
(c)(2), (c)(3) or (c)(4) hereof to constitute events permitting a distribution
from the Before Tax and Supplemental Accounts (or the affected Transfer
Accounts), such distribution must be made on account of such event in the form
of a lump sum distribution, as defined in Code Section 402(d)(4) (without
regard to clauses (i), (ii), (iii) and (iv) of subparagraph (A), or
subparagraphs (B) and (F) thereof); and provided, further, for the events
described in subsections (c)(3) or (c)(4) hereof to constitute events
permitting such a distribution, the Participating Company must maintain the
Plan after the disposition.
(d) Discontinuance Upon Reemployment or Termination of
Disability. If a Participant becomes eligible to receive or begins receiving
benefit payments in accordance with the terms of this Article XI and
subsequently is reemployed by an Affiliate (or ceases to be Disabled, as
applicable) prior to the time his Account has been distributed in full, all
distributions to such Participant shall be delayed or cease until such
Participant again becomes eligible to receive distributions from the Plan.
Notwithstanding the foregoing, if a Participant's benefit payments have
commenced in the form of a life annuity, joint and survivor annuity or
installment payments, for which an annuity contract has been purchased,
payments under such annuity contract shall not cease but shall continue during
the period of his reemployment.
11.2 Normal Payment Forms.
Except as provided in Section 11.5 or Section 11.8 or unless a
Participant otherwise elects in accordance with Section 11.3 or Section 11.7
(to the extent said section applies), a benefit described in this Article XI
shall be paid as follows:
(a) in the form of a Life Annuity, if the Participant does not
have a Spouse on his Benefit Commencement Date; or
(b) in the form of a Joint and 50% Survivor Annuity payable to
the Participant and his Spouse (as his Joint Annuitant), if the Participant has
a Spouse on his Benefit Commencement Date.
11.3 Election of Optional Payment Forms.
(a) Election. After receiving the retirement notice described
in Section 11.4, a Participant who is eligible for an annuity form of benefit
under Section 11.2 may make a Qualified Retirement Election at any time within
the 90-day period ending on his Benefit Commencement Date to have his benefits
paid in one of the alternative benefit payment forms described in subsection
(b) hereof and/or to name a Joint Annuitant (including a non-spouse Joint
Annuitant for a married Participant) with respect to that form of benefit.
(b) Optional Payment Forms. The alternative benefit forms from
which a Participant may elect pursuant to the terms of this Section shall be
equivalent to the amount of the Participant's vested Account balance and shall
be as follows:
(1) Life Annuity. A monthly retirement benefit payable
during the Participant's lifetime, with payments to cease after the
payment due on the first day of the month in which the Participant's
death occurs.
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(2) Joint and 50% or 100% Survivor Annuity. A monthly
retirement benefit which shall be payable during the Participant's
lifetime, with 50 or 100 percent, as elected by the Participant, of the
Participant's monthly benefit amount continuing after his death to the
person designated (or deemed designated) as his Joint Annuitant if such
Joint Annuitant survives him, for such Joint Annuitant's remaining
lifetime. Payments shall cease with the payment due on the first day of
the month in which occurs the later of the Participant's death or his
Joint Annuitant's death.
(3) Life Annuity with 5, 10 or 15 Years Certain. A
monthly benefit which shall be payable during the Participant's lifetime
with payments to cease after the payment due on the first day of the
month in which the Participant's death occurs; provided, payments shall
continue for a period of 5, 10 or 15 years as elected by the Participant,
after the Participant's Benefit Commencement Date, regardless of whether
the Participant dies before all such payments are made, and shall be paid
to his Joint Annuitant for the balance of such period certain; and,
provided further, in the event the joint life expectancy of the
Participant and his Joint Annuitant [determined as of the Participant's
Benefit Commencement Date in accordance with Code Section 401(a)(9)] is
less than the period certain selected by the Participant, then the
guaranteed period under this subsection shall not exceed such joint life
expectancy. If both the Participant and his Joint Annuitant die before
the expiration of the period certain described in this subsection such
that benefits remain due hereunder, all remaining amounts due shall be
paid to the estate of the Joint Annuitant.
(4) Periodic Installments. Periodic installments (either
monthly, quarterly, semiannually or annually, as elected by the
Participant) for a period not to exceed the period provided in subsection
(d) hereof. The amount distributed in each year shall be determined by
dividing the vested amount of the Participant's Account balance as of the
preceding Valuation Date by the number of distributions remaining;
(5) Level Installments. Periodic equal installments
(either monthly, quarterly, semiannually or annually, as elected by the
Participant) payable until the vested amount of the Participant's Account
balance is completely distributed. No installment arrangement may
provide for payments extending beyond the period provided in subsection
(d) hereof; or
(6) Single-Sum Payment. A single-sum payment of the
Participant's vested Account balance.
(7) Other Forms. If the Plan accepts a transfer of assets
and liabilities from a Prior Plan as part of a merger, consolidation or
transfer from another qualified retirement plan and any optional forms of
benefit not provided under the Plan are provided under the transferring
Prior Plan, the Plan shall offer such optional forms of benefit with
respect solely to the Transferred Accounts resulting from the merger,
consolidation or transfer, and such optional forms shall be described in
Section 1.1(c) of any Appendix 1 of the Adoption Agreement; provided, all
of the requirements relating to notices and elections, as required by the
Code and ERISA, shall apply.
(c) Rate of Payments to Joint Annuitant or Beneficiary.
Notwithstanding anything herein to the contrary, if a Participant dies after
his benefit payments to him have begun under an annuity form of payment, the
remaining portion of his distributable benefit shall be distributed to his
Joint Annuitant or Beneficiary at least as rapidly as under the method of
distribution in effect at the time of the Participant's death, such that the
requirements of Code Section 401(a)(9) shall be satisfied.
(d) Special Rules for Installment Payments. If a Participant
elects for his benefit to be paid in installment payments over a term certain
as provided in subsections (b)(4) or (b)(5) hereof, the following rules shall
apply:
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(1) The maximum length of the period over which
installment payments shall be made shall be the joint life expectancy of
such Participant and his designated Joint Annuitant or Beneficiary. The
initial value of the obligation for the installment payments shall be
equal to the vested amount of the Participant's Account balance on the
day payments are scheduled to commence. Notwithstanding anything herein
to the contrary, distributions from the Plan must satisfy the
requirements of Code Section 401(a)(9)(G). This means that (i) for
calendar years beginning before January 1, 1989, the present value of the
installment payments to be made to such Participant (in the event of his
retirement or Disability) must exceed 50 percent of the present value of
the total payments to be made to such Participant and his Joint
Annuitant; and, (ii) for calendar years beginning after December 31,
1988, the incidental benefit rules as described in Treasury Regulation
Section 1.401(a)(9)-2 must be satisfied.
(2) If a Participant dies after payment of his benefits
from the Plan has begun but before his entire benefit has been
distributed, his Joint Annuitant or Beneficiary may elect to receive the
remainder of the deceased Participant's Account in the form of a single
sum payment or to continue to receive the same installment payments which
would have been paid to the deceased Participant if he had survived.
(3) If a Joint Annuitant or Beneficiary who has begun
receiving installment payments pursuant to the terms of this subsection
dies prior to the full payment thereof, the remaining vested amount of
the Account balance shall be distributed to the designated beneficiary of
such Joint Annuitant or, if no such beneficiary has been designated or
survives, to the estate of such Joint Annuitant.
(4) If a distribution is to be made in the form of
installments payable over the life expectancy or joint life expectancy of
the Participant and his Joint Annuitant or Beneficiary, the life
expectancy or joint life expectancy, as applicable, of such persons shall
be calculated at the time distributions commence and shall not thereafter
be recalculated, unless the Joint Annuitant or Beneficiary is the
Participant's Spouse and the Participant and his Spouse both make an
irrevocable election, prior to the Participant's Benefit Commencement
Date, to have the life expectancy or joint life expectancy recalculated
annually.
(e) Direct Rollover Distributions. If (i) a Participant, (ii)
his Spouse who is his Beneficiary or (iii) his Spouse or former Spouse who is
the alternate payee under a qualified domestic relations order, as defined in
Code Section 414(p), who is the recipient of any Eligible Rollover
Distribution, elects to have such Eligible Rollover Distribution paid directly
to an Eligible Retirement Plan and specifies (in such form and at such time as
the Administrative Committee may prescribe) the Eligible Retirement Plan to
which such distribution is to be paid, such distribution shall be made in the
form of a direct trustee-to-trustee transfer to the specified Eligible
Retirement Plan; provided, such transfer shall be made only to the extent that
the Eligible Rollover Distribution would be included in gross income if not so
transferred [determined without regard to Code Section 402(c) and Section
403(a)(4)].
(f) Provision for Annuity Payments. If a Participant elects an
annuity form of payment, such payments, at the discretion of the Trustee, shall
be made directly from the Trust or through an annuity contract purchased with
the Participant's vested Account balance and distributed to him, and the amount
of such payments shall be equal to the amount that can be provided through such
an annuity contract. An annuity contract purchased and distributed pursuant to
this subsection shall be a non-transferable nonparticipating annuity with
distribution terms that comply with Code Section 401(a)(9), the regulations
thereunder, and the terms of the Plan.
11.4 Retirement Notice.
No less than 30 days and no more than 90 days before each
Participant's Benefit Commencement Date, the Administrative Committee shall
furnish each such Participant written notice of:
(a) the terms and conditions of the benefit payment forms
described in Section 11.3(b), the conditions under which they will be provided
and the relative financial effect of selecting any alternative benefit form;
(b) the Participant's right (subject to the written consent of
such Participant's Spouse, if any) to elect a benefit payment form other than
the normal form payable to him under Section 11.2 and the effect, if any, of
such election;
(c) the right of a married Participant's Spouse to negate the
Participant's election of an optional benefit payment form through a failure to
consent in writing before a notary public or a Plan representative to such
election;
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(d) the Administrative Committee's right to rely on a Spouse's
properly executed and notarized consent to the payment of Plan benefits in one
of the optional forms described in Section 11.3(b), which consent shall be
irrevocable with respect to such Spouse under the Plan;
(e) the Participant's right to revoke an election that his
benefit be paid in a form other than the normal form payable to him under
Section 11.2; and
(f) the Participant's right, upon his written request delivered
to the Administrative Committee, to receive more specific information regarding
the financial effect of selecting an alternative benefit form (including the
amount of payments under an annuity).
11.5 Cash-Out Payment of Benefits.
Notwithstanding anything to the contrary in this Article XI, and
subject to the terms of Section 9.3, in the event that the vested portion of
the Account of any Participant who separates from the service of all Affiliates
is less than or equal to $3,500, the full vested amount of such benefit
automatically shall be paid to such Participant in one single-sum, cash-out
distribution as soon as practicable after the date the Participant separates
from service, but in no event later than the end of the second Plan Year
following the Plan Year in which such Participant's separation occurs. In the
event a Participant has no vested interest in his Account at the time of his
separation from service, he shall be deemed to have received a cash-out
distribution at the time of his separation from service, and the forfeiture
provisions of Section 9.3(a) shall apply.
11.6 Assets Distributed; Effect of Outstanding Loans.
(a) Assets Distributed. Any distribution to a Participant, his
Joint Annuitant or his Beneficiary shall be made in the form of cash. Such
cash distributions may be paid directly from the Trust Fund or through the
purchase with Trust Fund assets of an annuity contract which is distributed to
the Participant, Joint Annuitant or Beneficiary, as applicable, and pursuant to
which an insurance company is obligated to make such cash distributions in
accordance with the distribution provisions of the Plan; provided, any such
distributed annuity contract will be nontransferable. If cash distributions
are made directly from the Trust Fund, the Participant's Account shall remain
invested in the Trust Fund and shall continue to participate in the investment
experience of the Trust Fund pursuant to the terms of Section 6.6, unless the
form of distribution elected by such Participant, Joint Annuitant or
Beneficiary does not give such Participant, Joint Annuitant or Beneficiary the
right to participate in investment experience following the date of
commencement of the distribution.
(b) Payment of Amounts Invested in Company Stock Trust Fund. In
the event of a distribution to a Participant whose Accounts are invested in the
Company Stock Trust Fund, the Company Stock Trustee shall liquidate the shares
of Company Stock allocated to such Accounts and shall transfer cash
representing the value of such shares to the Master Trust Fund, and the Master
Trustee shall pay such amounts to such Participant, Joint Annuitant or
beneficiary together with other distributions from the Master Trust Fund.
(c) Effect of Outstanding Loans. If an amount becomes payable
to a Participant, his Joint Annuitant or his Beneficiary pursuant to this
Article at a time when a Participant has an outstanding loan from the Plan, the
terms of Section 11.12(i) shall apply.
11.7 REA Transition Rules.
(a) Any living Participant not receiving benefits on August 23,
1984, who would otherwise not receive the benefits hereunder must be given the
opportunity to elect to have such sections apply (1) if such Participant is
credited with at least one Hour of Service under the Plan or a Prior Plan in a
Plan Year beginning on or after January 1, 1976, and (2) such Participant had
at least 10 Years of Vesting Service when he separated from service.
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(b) Any living Participant not receiving benefits on August 23,
1984, who was credited with at least one Hour of Service under the Plan or a
Prior Plan on or after September 2, 1974, and who is not otherwise credited
with any service in a Plan Year beginning on or after January 1, 1976, must be
given the opportunity to have his benefits paid in accordance with subsection
(d) hereof.
(c) The respective opportunities to elect (as described in
subsections (a) and (b) hereof) must be afforded to the appropriate
Participants during the period commencing on August 23, 1984, and ending on the
date benefits would otherwise commence to such Participants.
(d) Any Participant who has elected pursuant to subsection (b)
and any Participant who does not elect under subsection (a) or who meets the
requirements of subsection (a) except that such Participant does not have at
least 10 Years of Vesting Service when he separates from service, shall have
his benefits distributed in accordance with all of the following requirements
if benefits would have been payable in the form of a Life Annuity:
(1) If benefits in the form of a Life Annuity become
payable to a married Participant who:
(i) begins to receive payments under the Plan on or
after Normal Retirement Age; or
(ii) dies on or after Normal Retirement Age while
still working for a Participating Company; or
(iii) begins to receive payments on or after the
"qualified early retirement age"; or
(iv) separates from service on or after attaining
Normal Retirement Age (or the "qualified early retirement age")
and after satisfying the eligibility requirements for the payment
of benefits under the Plan and thereafter dies before beginning to
receive such benefits;
then such benefits shall be received under the Plan in the form of a
Joint and 50% Survivor Annuity with his Spouse as Joint Annuitant, unless
the Participant has elected otherwise during the election period. The
election period must begin at least 6 months before the Participant
attains "qualified early retirement age" and end not more than 90 days
before the commencement of benefits. Any such election shall be in
writing and may be changed by the Participant at any time.
(2) A Participant who is employed after attaining the
"qualified early retirement age" shall be given the opportunity to elect,
during the election period, to have a survivor annuity payable on death.
The election period begins on the later of (i) the 90th day before the
Participant attains the "qualified early retirement age", or (ii) the
date on which participation begins, and ends on the date the Participant
separates from service. Any such election shall be in writing and may be
changed by the Participant at any time. If the Participant elects the
survivor annuity, payments under such annuity must not be less than the
payments which would have been made to the Spouse under the Joint and 50%
Survivor Annuity if the Participant had retired on the day before his
death.
(3) For purposes of this subsection, "qualified early
retirement age" means the latest of:
(i) the earliest date under the Plan on which the
Participant may elect to receive retirement benefits;
(ii) the first day of the 120th month beginning
before the Participant reaches Normal Retirement Age; or
(iii) the date the Participant begins participation.
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11.8 Qualified Domestic Relations Orders.
In the event the Administrative Committee receives a domestic
relations order which it determines to be a qualified domestic relations order
("QDRO") [see Section 16.1(b)], the Plan shall pay such benefit to the
prescribed alternate payee(s) at such time and in such form, as shall be
described in the QDRO and permitted under Section 16.1(b). If the QDRO
requires immediate payment, the specified benefit shall be paid to the
alternate payee as soon as practicable following the end of the month within
which the Administrative Committee determines that the order is qualified or,
if later, after timing restrictions and requirements under the Code are
satisfied. To the extent consistent with the QDRO, the amount of the payment
to an alternate payee shall include earnings, interest and other investment
proceeds through (but not after) the Valuation Date as of which the Trustee
processes the distribution. If a Participant's Account is partially paid or
payable to an alternate payee, the Participant's remaining portion of his
Account shall be reduced accordingly and shall be subject to the distribution
provisions in this Article XI.
11.9 Hardship Withdrawals.
(a) Parameters of Hardship Withdrawals. If elected by the
Adopting Company pursuant to Section 11.2 of the Adoption Agreement, a
Participant may make a withdrawal from his vested Account [other than (i) his
Supplemental Account or Transfer Accounts described in Section 11.1(c), and
(ii) any investment earnings attributable to Before Tax Contributions and
earned after December 31, 1988] on account of hardship. For purposes of this
subsection, a withdrawal will be on account of "hardship" if it is necessary to
satisfy immediate and heavy financial need of the Participant. A withdrawal
based on financial hardship cannot exceed the amount necessary to meet the
immediate financial need created by the hardship and not reasonably available
from other resources of the Participant. The Administrative Committee shall
make its determination, as to whether a Participant has suffered an immediate
and heavy financial need and whether it is necessary to use a hardship
withdrawal from the Plan to satisfy that need, on the basis of all relevant
facts and circumstances. The Administrative Committee shall also establish the
minimum amount that may be withdrawn.
(b) Immediate and Heavy Financial Need. For purposes of the
Plan, an immediate and heavy financial need exists if the withdrawal is on
account of (i) expenses for medical care described in Code Section 213(d)
previously incurred by the Participant, his Spouse or dependents, or necessary
to obtain such medical care for such persons, (ii) the purchase (excluding
mortgage payments) of a principal residence for the Participant, (iii) the
payment of tuition and related educational fees for the next 12 months of
post-secondary education for the Participant, his Spouse or dependents, or (iv)
the need to prevent eviction of the Participant from his principal residence or
foreclosure on the mortgage of the Participant's principal residence.
(c) Necessary to Satisfy a Financial Need. A withdrawal will be
considered as necessary to satisfy an immediate and heavy financial need of a
Participant only if (i) the Participant has obtained all distributions, other
than hardship withdrawals, and all nontaxable loans under all plans maintained
by the Participating Company and its Affiliates; (ii) all plans maintained by
the Company and its Affiliates provide that the Participant's Before Tax and
After Tax Contributions will be suspended for a 12-month period, beginning with
the month following the month of receipt of the hardship withdrawal; (iii) the
withdrawal is not in excess of the amount of the Participant's immediate and
heavy financial need; and (iv) all plans maintained by the Participating
Company and its Affiliates provide that the employee may not make Before Tax
Contributions for his taxable year immediately following the taxable year of
the hardship withdrawal in excess of the Maximum Deferral Amount for such
taxable year less the amount of his Before Tax Contributions for the taxable
year of the hardship withdrawal. The amount of an immediate and heavy
financial need may include amounts necessary for the Participant to pay any
federal, state or local taxes which are reasonably anticipated to result from
the hardship withdrawal.
(d) Election to Withdraw. All applications for hardship
withdrawals shall be in writing on a form provided by the Administrative
Committee and shall contain such information as the Administrative Committee
may reasonably request. The Participant's Spouse, if any, must consent to any
withdrawal. The spousal consent must be obtained within the 90-day period that
ends on the date the withdrawal is to be paid. Such consent must be in
writing,
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must acknowledge the effect of the withdrawal and must be witnessed by a notary
public or Plan representative, all in a manner consistent with the rules
applicable to Qualified Retirement Elections.
(e) Payment of Withdrawal. The amount of a hardship withdrawal
shall be paid to a Participant in a single sum as soon as practicable after the
Administrative Committee approves the withdrawal application or, if later,
after timing restrictions and requirements under the Code are satisfied. Any
such withdrawal shall be treated as a payment of benefits under this Article
XI, and all of the requirements of this Article shall apply.
(f) Effect of Outstanding Loans. If an amount becomes payable
to a Participant pursuant to this Section at a time when such Participant has
an outstanding Loan from the Plan, the terms of Section 11.12(i) shall apply.
11.10 Withdrawals from After Tax and Voluntary Accounts.
(a) Election to Withdraw. If elected by the Adopting Company
pursuant to Section 11.3 of the Adoption Agreement, a Participant may elect to
withdraw all or a part of the value of his After Tax Account, his Voluntary
Account and any Transfer Account credited with after tax contributions while he
is an employee of an Affiliate. Such election must be made in a writing,
executed by the Participant and delivered to the Administrative Committee at
such time prior to the desired withdrawal date as the Administrative Committee
may require. The Participant's Spouse, if any, must consent to any withdrawal.
The spousal consent must be obtained within the 90-day period that ends on the
date the withdrawal is to be paid. Such consent must be in writing, must
acknowledge the effect of the withdrawal and must be witnessed by a notary
public or Plan representative, all in a manner consistent with the rules
applicable to Qualified Retirement Elections.
(b) Payment of Withdrawal. Any such withdrawal shall be treated
as a payment of benefits under this Article XI, and all of the requirements of
this Article.
(c) Effect of Outstanding Loans. If an amount becomes payable
to a Participant pursuant to this Section at a time when such Participant has
an outstanding loan from the Plan, the terms of Section 11.12(i) shall apply.
11.11 Withdrawals of Transfer Accounts.
If the assets and benefits of a qualified retirement plan which,
(i) allows Code Section 411(d)(6) protected in-service withdrawals (other than
those permitted in Section 11.9, Section 11.10 and Section 11.11) and/or (ii)
allows one or more Code Section 411(d)(6) protected forms of distribution not
generally permitted hereunder, are transferred to or merged into the Plan, the
Participants who have Transfer Accounts reflecting the accrued benefits under
that prior plan shall be permitted to withdraw and/or receive distributions of,
all or a portion of the amounts from their Transfer Accounts in a manner and
subject to rules and restrictions, similar to those provided under the prior
plan such that the Plan will comply with the requirements of Code Section
411(d)(6); provided, any such withdrawal shall be treated as a payment of
benefits under this Article XI, and all of the requirements of this Article
(including, but not limited to, the spousal consent, normal payment forms and
Qualified Retirement Election requirements) shall apply.
11.12 Loans to Participants.
(a) Grant of Authority. If elected by the Adopting Company
pursuant to Section 11.4 of the Adoption Agreement, loans to Participants and
Beneficiaries generally shall be allowed; provided, if the Administrative
Committee determines in its sole discretion that it is not administratively
feasible or desirable to make such loans during any period of time, no loans
shall be made during such period; and, provided further, no loan shall be
permitted or made to any person who is (i) an owner-employee, as defined in
Section 7.8(e), (ii) a more than 5-percent shareholder employee of an
S-corporation that is an Affiliate, or (iii) any family member or affiliated
company with respect to any of the persons described in clauses (i) or (ii)
hereof, all as more fully described in ERISA Section 408(d). Subject to the
limitations set forth in this Section and to such uniform and nondiscriminatory
rules as may from time to time be adopted by the Administrative Committee, the
Trustee may make a loan or loans to the borrower, as
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approved by the Administrative Committee. A Participant or Beneficiary may
obtain loan application forms from the Administrative Committee and return such
forms completed to the Administrative Committee. The Administrative Committee
shall administer the loan program. The terms of this Section shall apply to
all loans made or renewed on or after October 19, 1989, and the terms of the
Plan in effect prior to the Effective Date shall apply to all loans made or
renewed prior to that date.
(b) Nondiscriminatory Policy. Loans shall be available to all
Participants and Beneficiaries on a reasonably equivalent basis, without regard
to an individual's race, color, religion, age, sex or national origin;
provided, the Administrative Committee may provide for different treatment of
Participants who are active employees of Affiliates and Participants and
Beneficiaries who are not, as long as that different treatment is based on
valid economic differences which may exist between these two groups and which
commercial lenders in the business of making similar types of loans legally
recognize for purposes of loan availability. Loans shall not be made available
to borrowers who are Highly Compensated Employees in an amount greater than the
amount available to other borrowers; provided, this limitation shall be
interpreted to mean that, subject to the other limitations in this Section, the
same percentage of each Participant's and Beneficiary's vested Account balance
may be loaned to each such borrower regardless of the actual amount of his
vested Account balance.
(c) Approval of Loans. The Administrative Committee shall
approve a loan for a Participant or Beneficiary; provided, (i) the Participant
or Beneficiary submits properly completed loan application documents, (ii) the
Administrative Committee determines that it is administratively feasible to
make loans at such time, (iii) the amount of loan requested does not exceed the
amount of vested Account balance available to secure the loan, and (iv) the
Participant or Beneficiary does not have a loan outstanding.
(d) Consent Rules. If a Participant applies for a loan from the
Plan and the amount of such loan (when added to the outstanding balances of all
loans made to the Participant under the Plan (and all other qualified employer
plans, as defined in Code Section 72(p)(4)(A), maintained by the Affiliates)
which used the Participant's Account as security therefor) is (or has ever
been) greater than $3,500, the Participant's Spouse, if any, must consent to
such loan. The spousal consent must be obtained within the 90-day period that
ends on the date the loan is to be secured by the Participant's Account. Such
consent must be in writing, must acknowledge the effect of the loan and must be
witnessed by a notary public or Plan representative, all in a manner consistent
with the rules applicable to Qualified Retirement Elections. Such consent
thereafter will be binding with respect to the consenting Spouse and any
subsequent Spouse with respect to such loan. A new consent will be required if
the Account balance is used for renegotiating extension, renewal or other
revision of the loan.
(e) Minimum Loan Amount. The minimum amount of any loan shall
$1,000.
(f) Maximum Loan Amount. No Participant or Beneficiary may have
more than one loan outstanding at any time. In addition, no loan may be made
to any Participant or Beneficiary from the Plan if the amount of such loan
exceeds the lesser of:
(1) $50,000 minus the highest aggregate principal balance,
outstanding during the year ending on the day before such loan is made,
of all loans made to the Participant or Beneficiary by the qualified
employer plans [as defined in Code Section 72(p)(4)(A)] maintained by the
Affiliates; or
(2) the difference between (A) 50 percent of the
Participant's or Beneficiary's total vested interest in the Plan and all
other qualified employer plans maintained by the Affiliates, minus (B)
the total amount of all loans outstanding on the date the loan is made
from all qualified employer plans maintained by the Affiliates.
Notwithstanding anything herein to the contrary, in no event shall the amount
of a loan made to a Participant or Beneficiary from the Plan exceed 50 percent
of such Participant's or Beneficiary's vested Account balance immediately after
the origination of the loan.
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(g) Maximum Loan Term.
(1) Except as provided in subsection (g)(2) hereof, the
terms of any loan made to a Participant or Beneficiary from the Plan
shall require that the full amount of the loan be repaid within the
5-year period commencing on the date the loan is made, and in no event
shall the repayment period of the loan subsequently be extended beyond
such 5-year period. The Trustee shall make a diligent effort to collect
the full amount of the loan within this specified repayment period and
shall inform the borrower that, in the event the loan is not fully repaid
within the 5-year period, the borrower will be treated as having received
a taxable distribution from the Plan.
(2) The 5-year repayment rule set forth in subsection
(g)(1) hereof shall not apply to the extent that a loan to a Participant
or Beneficiary from the Plan is used to acquire any dwelling unit which
is used, or within a reasonable time is to be used, as a principal
residence of the borrower. Whether a dwelling unit is to be used within
a reasonable time as a principal residence is to be determined by the
Administrative Committee at the time the loan is made, and the
Administrative Committee may require such written statements and other
evidence from the borrower as it deems necessary to make this
determination. Loans made with respect to principal residences pursuant
to this subsection generally shall have a repayment period that the
Administrative Committee determines is appropriate taking into account
circumstances which commercial lenders would consider relevant, but in no
event shall the term of the loan exceed 10 years. The Trustee, with the
consent of the Administrative Committee, may extend or renew such loans
if the conditions qualifying the Participant or Beneficiary for the
initial loan continue beyond the loan due date; provided, such extensions
and renewals shall be treated as the making of new loans under this
Section and shall satisfy the maximum loan amounts and other limitations
and requirements set forth in this Section.
(h) Terms of Repayment. All loans to Participants and
Beneficiaries made by the Trustee shall be subject to a definite repayment
schedule which requires substantially level amortization over the term of the
loan with payments to be made not less frequently than quarterly (and more
frequently if required by the Administrative Committee's policy regarding Plan
loans). Unless the Administrative Committee provides for different methods in
its written loan policy statement, payments shall be made by Participants who
are employees of Affiliates on a payroll deduction basis, and payments from
other Participants and from Beneficiaries shall be made by cash, check or other
cash equivalent.
(i) Adequacy of Security. All loans to Participants and
Beneficiaries made by the Trustee shall be secured by the pledge of a dollar
amount of the borrower's Account balance which is equal to 50 percent of the
borrower's Account balance immediately after the origination of the loan or, if
lesser, the amount of the loan. Notwithstanding anything herein to the
contrary, the pledge of such security shall be made in such manner and amount
as the Administrative Committee may require for the loan to be considered
adequately secured. A loan will be considered to be "adequately secured" (i)
if the security posted for such loan is in addition to and supporting a promise
to pay, (ii) if it is pledged in a manner such that it may be sold, foreclosed
upon, or otherwise disposed of upon default of repayment of the loan, and (iii)
if the value and liquidity of that security is such that it may reasonably be
anticipated that loss of principal or interest will not result from the loan.
The adequacy of such security will be determined in light of the type and
amount of security which would be required in the case of an otherwise
identical transaction in a normal commercial setting between unrelated parties
on arm's-length terms. During the period that a loan is outstanding, if a
Participant becomes eligible to receive a hardship or After Tax withdrawal or a
distribution, the amount of such Participant's Account which he shall be
eligible to receive through withdrawal or distribution shall not exceed that
amount which will reduce by more than 50 percent such Participant's Account
balance, excluding all outstanding loan amounts. Should a withdrawal or
distribution reduce the Account balance by more than 50 percent, the withdrawal
or distribution shall first be applied to reduce such loan amount, and, once
the loan is repaid in full, any excess amount may be distributed to such
Participant (or his Beneficiary).
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(j) Rate of Interest. A loan from the Plan to a Participant or
a Beneficiary must bear a reasonable rate of interest. A loan will be
considered to bear "a reasonable rate of interest" if such loan provides the
Plan with a return commensurate with interest rates charged by persons in the
business of lending money for loans which would be made under similar
circumstances. The Administrative Committee's decision as to the rate of
interest for any Plan loan shall be based primarily on the rate of interest
that one or more local banks would charge on a similar loan, taking into
account, among other things, the collateral pledged to secure the loan.
(k) Source of Loan Amounts. The proceeds of a loan shall be
charged against the subaccounts of the borrower in the same proportion as the
balance of each such subaccount bears to the total balance of his entire
Account.
(l) Crediting Loan Payments to Accounts. The loan shall be
considered a directed investment of the borrower and any principal and interest
paid on the loan shall be considered a part of his total Account. Each payment
of principal and interest shall be credited to the borrower's subaccounts as
provided in the Loan Policy Statement.
(m) Remedies in the Event of Default. If any loan payments are
not paid as and when due or within 30 days after such due date, the
Administrative Committee may declare the loan to be in default. The
Administrative Committee may take such actions, as it deems appropriate, to
allow the borrower to cure such default or to otherwise collect such overdue
payments or, as the case may be, the outstanding balance of the loan. Among
other things, the Administrative Committee's actions may include causing all or
any portion of the borrower's Account which has been pledged to secure the loan
to be used to repay such loan; provided, although the Administrative Committee
may treat any portion of the loan balance that remains outstanding after a
default as taxable income to the borrower in accordance with the terms of Code
Section 72(p), no portion of such outstanding loan balance may be treated as a
reduction of a Participant's Account balance until such time as such reduction,
if treated as a distribution, will not breach the restrictions of Section
11.1(c). In the unlikely event that default by a Participant who is currently
employed occurs, foreclosure may be delayed until the borrower ceases to be an
employee, if such delay is necessary to maintain the qualified status of the
Plan; provided, such delay must not jeopardize the Plan's ability to collect
the full amount of principal and interest due under the loan.
11.13 Unclaimed Benefits.
In the event a Participant becomes entitled to benefits under the
Plan other than death benefits and the Administrative Committee is unable to
locate such Participant (after sending a letter, return receipt requested, to
the Participant's last known address, and after such further diligent efforts
as the Administrative Committee in its sole discretion deems appropriate)
within 1 year from the date upon which he becomes so entitled, the
Administrative Committee shall direct that such benefits be paid to the Joint
Annuitant of such Participant; provided, if such Joint Annuitant has not been
designated, has died or cannot be located in a manner similar to that described
in Section 11.21(b), the person(s) who have been designated as the
Participant's Beneficiary or, if none, who have been designated as the
Beneficiary by operation of the Plan under Section 11.21(a), shall be deemed to
be such Participant's Joint Annuitant for purposes of this Section; and,
provided further, if the distribution is payable upon termination of the Plan,
the Administrative Committee shall not be required to wait until the end of
such 1-year period. If neither the Participant, his Joint Annuitant nor his
Beneficiary can be located and all of them fail to claim such benefits by the
end of the fifth Plan Year following the Plan Year in which such Participant
becomes entitled to such benefits, then the full Account of the Participant
shall be deemed abandoned and treated as a Forfeiture; provided, in the event
such Participant, Joint Annuitant or Beneficiary is located or makes a claim
subsequent to the allocation of the abandoned Account, the amount of the
abandoned Account (unadjusted for any investment gains or losses from the time
of abandonment) shall be restored (from abandoned Accounts, Forfeitures, Trust
earnings or Contributions made by the Participating Companies) to such
Participant, Joint Annuitant or Beneficiary, as appropriate; and, provided
further, the Administrative Committee, in its sole discretion, may delay the
deemed date of abandonment of any such Account for a period longer than the
prescribed five Plan Years if it believes that it is in the best interest of
the Plan to do so.
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11.14 Claims.
(a) Procedure. Claims for benefits under the Plan may be filed
with the Administrative Committee on forms supplied by the Administrative
Committee. The Administrative Committee shall furnish to the claimant written
notice of the disposition of a claim within 90 days after the application
therefor is filed; provided, if special circumstances require an extension of
time for processing the claim, the Administrative Committee shall furnish
written notice of the extension to the claimant prior to the end of the initial
90-day period, and such extension shall not exceed one additional, consecutive
90-day period. In the event the claim is denied, the notice of the disposition
of the claim shall provide the specific reasons for the denial, cites of the
pertinent provisions of the Plan, and, where appropriate, an explanation as to
how the claimant can perfect the claim and/or submit the claim for review.
(b) Review Procedure. Any Participant, Joint Annuitant or
Beneficiary who has been denied a benefit, or his duly authorized
representative, shall be entitled, upon request to the Administrative
Committee, to appeal the denial of his claim. To do so, the claimant must
obtain a form from the Administrative Committee on which to request further
consideration of his position. The claimant, or his duly authorized
representative, may review pertinent documents related to the Plan and in the
Administrative Committee's possession in order to prepare the appeal. The form
containing the request for review, together with a written statement of the
claimant's position, must be filed with the Administrative Committee no later
than 60 days after receipt of the written notification of denial of a claim
provided for in subsection (a) hereof. The Administrative Committee's decision
shall be made within 60 days following the filing of the request for review and
shall be communicated in writing to the claimant; provided, if special
circumstances require an extension of time for processing the appeal, the
Administrative Committee shall furnish written notice to the claimant prior to
the end of the initial 60-day period, and such an extension shall not exceed
one additional 60-day period. If unfavorable, the notice of decision shall
explain the reason or reasons for denial and indicate the provisions of the
Plan or other documents used to arrive at the decision.
(c) Satisfaction of Claims. Any payment to a Participant, Joint
Annuitant or Beneficiary, or to his legal representative or heirs at law, all
in accordance with the provisions of the Plan, shall to the extent thereof be
in full satisfaction of all claims hereunder against the Trustee, the
Administrative Committee and the Adopting Company, any of whom may require such
Participant, Joint Annuitant, Beneficiary, legal representative or heirs at
law, as a condition to such payment, to execute a receipt and release therefor
in such form as shall be determined by the Trustee, the Administrative
Committee or the Adopting Company, as the case may be. If receipt and release
shall be required but execution by such Participant, Joint Annuitant,
Beneficiary, legal representative or heirs at law shall not be accomplished so
that the terms of Section 11.1(b) (dealing with the timing of distributions)
may be fulfilled, such benefits may be distributed or paid into any appropriate
court or to such other place as such court shall direct, for disposition in
accordance with the order of such court, and such distribution shall be deemed
to comply with the requirements of Section 11.1(b).
11.15 Explanation of Rollover Distributions.
Within a reasonable period of time [as defined for purposes of
Code Section 402(f)] before making an Eligible Rollover Distribution from the
Plan to a Participant or Beneficiary, the Administrative Committee shall
provide such Participant or Beneficiary with a written explanation of (i) the
provisions under which the distributee may have the distribution directly
transferred to another Eligible Retirement Plan, (ii) the provisions which
require the withholding of tax on the distribution if it is not directly
transferred to another Eligible Retirement Plan, (iii) the provisions under
which the distribution will not be subject to tax if transferred to an Eligible
Retirement Plan within 60 days after the date on which the distributee receives
the distribution, and (iv) such other terms and provisions as may be required
under Code Section 402(f) and the regulations promulgated thereunder.
11.16 Payment of Survivor Benefits.
(a) General. Subject to the requirements of Section 7.9 and
except as provided in Section 11.19 or unless a Participant or his Beneficiary
otherwise elects in accordance with Section 11.18, if a Participant who has a
vested interest
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in all or any portion of his Account dies on or after August 23, 1984 and
before his Benefit Commencement Date, a monthly Survivor Annuity shall be
payable on his behalf to his Beneficiary. Such monthly Survivor Annuity shall
be an annuity for the life of the Participant's Beneficiary, the actuarial
equivalent of which shall be equal to the Participant's vested Account as of
the Valuation Date immediately preceding the date such annuity is scheduled to
begin (or, if daily Valuation Dates are elected in Section 2.1(d) of the
Adoption Agreement, the Valuation Date on which such distribution is
processed).
(b) Exclusion. No survivor benefit shall be payable under this
Section 11.16 to any person who is not living on the date as of which the
payment is scheduled to commence under Section 11.18.
11.17 Election of Optional Payment Forms.
(a) Election. Subject to Section 11.19, a Participant may make
an election to have such survivor benefit paid in one of the alternative
benefit payment forms described in subsection (b) hereof. Any such election
generally may be made at any time during the period beginning on or after the
first day of the Plan Year in which the Participant attains age 35 and ending
on the earlier of the Participant's death or Benefit Commencement Date;
provided, an election may be made prior to the date this period begins, but the
effectiveness of any such election shall expire as of the date the Participant
attains age 35. No spousal consent shall be required for any such election
which changes the form of benefit (but see Section 11.21 regarding spousal
consent requirements for designation of a non-spouse Beneficiary). In
addition, after the death of the Participant, his Beneficiary may elect to
receive a distribution in any of the alternative benefit payment forms
described in subsection (b) hereof.
(b) Optional Payment Forms. The alternative benefit forms from
which a Participant or Beneficiary may elect pursuant to the terms of this
Section shall be equivalent to the Participant's or Beneficiary's vested
Account balance and shall be as follows:
(1) Life Annuity with 5, 10 or 15 Years Certain. A
monthly benefit which shall be payable during the lifetime of the
Beneficiary and which, if the Beneficiary dies within 5, 10 or 15 years
as elected by the Participant or his Beneficiary, of the date as of which
his survivor benefit payments commence, shall continue to be paid to his
Beneficiary for the balance of such 5, 10 or 15-year period, whichever is
applicable; provided, in the event the life expectancy of the Beneficiary
[determined as of the Beneficiary's benefit commencement date in
accordance with Code Section 401(a)(9)] is less than 5, 10 or 15 years,
whichever is applicable, then the guaranteed period under this subsection
shall not exceed such life expectancy;
(2) Periodic Installments. Periodic installments (either
monthly, quarterly, semiannually or annually) for a period not to exceed
the period provided in subsection (c) hereof. The amount distributed in
each year shall be determined by dividing the vested amount of the
Participant's Account balance as of the preceding Valuation Date by the
number of distributions remaining;
(3) Level Installments. Periodic equal installments
(either monthly, quarterly, semiannually or annually) payable until the
vested amount of the Participant's Account balance is completely
distributed. No installment arrangement may provide for payments
extending beyond the period provided in subsection (c) hereof; or
(4) Single-Sum Payment. A single-sum payment of the
Participant's Account balance;
provided, if the Participant designates more than one Beneficiary to receive
payment of his benefit upon his death, the Participant (and his Beneficiaries)
shall be deemed to have selected a single sum payment as the form of benefit
distribution.
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(c) Special Rules for Installment Payments. If a Participant or
his Beneficiary elects for his benefit to be paid in installment payments over
a term certain as provided in subsection (b)(2) or (b)(3) hereof, the following
rules shall apply:
(1) The maximum length of the period over which
installment payments shall be made shall be the shorter of 10 years (5
years if the Beneficiary is not an individual, such as a trust or estate)
or the life expectancy of the Beneficiary. Such life expectancy shall be
calculated at the time distributions are to commence and shall not be
recalculated.
(2) If a Beneficiary who has begun receiving installment
payments pursuant to the terms of this subsection dies prior to the full
payment thereof, the remaining amount of the Account balance shall be
distributed to the designated beneficiary of such Beneficiary or, if no
such beneficiary has been designated or survives, to the estate of such
Beneficiary.
11.18 Commencement of Survivor Benefits.
(a) Payments to Spouse. Except as provided in Section 11.19, if
the Participant's Spouse is his Beneficiary and is eligible to receive a
survivor benefit under Section 11.16(a) payment of such benefit shall commence
as of the first day of the calendar month following the later of (i) the date
on which the Participant would have attained his Normal Retirement Age (if he
had survived) or (ii) the Participant's date of death; provided, if the
Participant dies before his Normal Retirement Age, his Spouse instead may elect
(on a form provided for this purpose by the Administrative Committee and in a
manner that satisfies the requirements of the Retirement Equity Act of 1984)
for the payment of his survivor benefit to commence as of the first day of any
calendar month following the Participant's date of death.
(b) Payments to a Non-Spouse Beneficiary. Except as provided in
Section 11.19, if a Beneficiary who is not the Participant's Spouse is eligible
to receive a survivor benefit under Section 11.16(a), payment of such benefit
shall commence as of the first day of the calendar month following the
Participant's date of death.
(c) Minimum Benefit Rules. All distributions will be made in
accordance with Code Section 401(a)(9), the regulations promulgated under Code
Section 401(a)(9), including Treasury Regulation Section 1.401(a)(9)-2 and any
other provisions reflecting the requirements of Code Section 401(a)(9) and
prescribed by the Internal Revenue Service, all of which are incorporated by
reference; and the terms of the Plan reflecting the requirements of Code
Section 401(a)(9) override the distribution options (if any) in the Plan which
are inconsistent with those requirements.
11.19 Cash-Out Payment of Survivor Benefits.
If the Participant's vested Account balance is $3,500 or less at
all times before the Participant's date of death, the full amount of such
vested Account balance automatically shall be paid to his Beneficiary in one
single-sum, cash-out distribution as soon as practicable after the
Participant's date of death.
11.20 Death During Suspension of Benefits.
If a Participant separates from service for any reason (other than
death), he begins receiving benefits as of his Benefit Commencement Date, he
then becomes reemployed, his benefit payments are suspended [as provided in
Section 11.1(d)], and he dies before payment of his benefits recommence, his
suspended benefits (if any) and any new benefits which are allocated to his
Account during such period of reemployment shall be treated as a survivor
benefit and shall be determined and paid pursuant to the terms of this Article.
11.21 Beneficiary Designation.
(a) General. In accordance with the terms of this Section,
Participants shall designate and from time to time may redesignate their
Beneficiary or Beneficiaries in such form and manner as the Administrative
Committee
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may determine. A Participant shall be deemed to have named his Surviving
Spouse, if any, as his sole Beneficiary unless his Spouse consents to the
payment of all or a specified portion of the Participant's death benefit to a
Beneficiary other than or in addition to the Surviving Spouse in a manner
satisfying the requirements of a Qualified Spousal Waiver and such other
procedures as the Administrative Committee may establish. Notwithstanding the
foregoing, a married Participant may designate a nonspouse Beneficiary without
a Qualified Spousal Waiver if the Participant establishes to the satisfaction
of the Administrative Committee that a Qualified Spousal Waiver may not be
obtained because his Spouse cannot be located or such other permissible
circumstances exist as the Secretary of the Treasury may prescribe by
regulation. A Qualified Spousal Waiver generally may be made at any time
during the period beginning on or after the first day of the Plan Year in which
the Participant attains age 35 and ending on the earlier of the Participant's
death or Benefit Commencement Date; provided, a Qualified Spousal Waiver may be
made prior to the date this period begins, but any such election shall expire
as of the date the Participant attains age 35.
(b) No Designation or Designee Dead or Missing. In the event
that:
(1) a Participant dies without designating a Beneficiary;
(2) the Beneficiary designated by a Participant is not
surviving when a payment is to be made to such person under the Plan, and
no contingent Beneficiary has been designated; or
(3) the Beneficiary designated by a Participant cannot be
located by the Administrative Committee within 1 year after the date
benefits are to commence to such person;
then, in any of such events, the Beneficiary of such Participant with respect
to any benefits that remain payable under the Plan shall be the Participant's
Surviving Spouse, if any, and if not, then the estate of the Participant.
11.22 Survivor Benefit Notice.
The Administrative Committee shall furnish each Participant (other
than a Participant who has separated from service and who has no vested
Account) with a written notice which explains the terms and conditions related
to the survivor benefit provided hereunder and which is comparable in content
and substance to the retirement notice described in Section 11.4. The
Administrative Committee shall furnish such survivor benefit notice within
whichever of the following periods ends last:
(1) the period beginning on the 1st day of the Plan Year
in which the Participant attains age 32 and ending on the last day of the
Plan Year preceding the Plan Year in which the Participant attains age
35;
(2) the period which begins 1 year before and ends on the
day before the 1-year anniversary of the date on which an Employee
becomes a Participant; or
(3) with respect to a Participant whose employment with
all Affiliates ends before he attains age 35, the period which begins 1
year before and ends 1 year after the date on which he separates from
service.
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ARTICLE XII
ADMINISTRATION
12.1 Administrative Committee; Appointment and Term of Office.
(a) Appointment. The Administrative Committee shall consist of
not less than one member who shall be appointed by and serve at the pleasure of
the Board.
(b) Removal, Resignation, Successor. The Board shall have the
right to remove any member of the Administrative Committee at any time. A
member may resign at any time by written resignation to the Board. If a
vacancy in the Administrative Committee should occur, a successor may be
appointed by the Board.
(c) Certification. A written certification shall be given to
the Trustee by the Board of all members of the Administrative Committee
together with a specimen signature of each member. For all purposes hereunder,
the Trustee shall be conclusively entitled to rely upon such certification
until the Trustee is otherwise notified in writing.
12.2 Organization of Administrative Committee.
The Administrative Committee may elect a Chairman and a Secretary
from among its members. In addition to those powers set forth elsewhere in the
Plan, the Administrative Committee may appoint such agents, who need not be
members of such Administrative Committee, as it may deem necessary for the
effective performance of its duties and may delegate to such agents such powers
and duties, whether ministerial or discretionary, as the Administrative
Committee may deem expedient or appropriate. The compensation of such agents
who are not full-time Employees of a Participating Company shall be fixed by
the Administrative Committee within limits set by the Board and shall be paid
by the Adopting Company (to be divided equitably among the Participating
Companies) or from the Trust Fund as determined by the Administrative
Committee. The Administrative Committee shall act by majority vote; provided,
the Board or the Administrative Committee itself may appoint one or more of the
Administrative Committee's members to act on its behalf in general or with
respect to specific matters. Its members shall serve as such without
compensation.
12.3 Powers and Responsibility.
The Administrative Committee shall fulfill the duties of
"administrator" as set forth in Section 3(16) of ERISA and shall have complete
control of the administration of the Plan hereunder, with all powers necessary
to enable it properly to carry out its duties as set forth in the Plan and the
Trust Agreement. The Administrative Committee shall have the following duties
and responsibilities:
(a) to construe the Plan and to determine all questions that
shall arise thereunder;
(b) to decide all questions relating to the eligibility of
Employees to participate in the benefits of the Plan;
(c) to determine the benefits of the Plan to which any
Participant or his Joint Annuitant or Beneficiary may be entitled, to take any
actions necessary to assure timely payment of benefits, and to take any actions
necessary to assure a full and fair review for any person who is denied a claim
to any benefits under the Plan;
(d) to maintain and retain records relating to Participants and
their Joint Annuitants and Beneficiaries;
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(e) to prepare and furnish to Participants all information
required under federal law or provisions of the Plan to be furnished to them;
(f) to prepare and furnish to the Trustee sufficient employee
data and the amount of Contributions received from all sources so that the
Trustee may maintain separate accounts for Participants and Beneficiaries and
make required payments of benefits;
(g) to prepare and file or publish with the Secretary of Labor,
the Secretary of the Treasury, their delegates and all other appropriate
government officials all reports and other information required under law to be
so filed or published;
(h) to provide directions to the Trustee with respect to the
methods of benefit payment, valuations at dates other than the regular
Valuation Dates and all other matters where called for in the Plan or requested
by the Trustee;
(i) to employ or retain other persons, including legal counsel,
to render advice with respect to any responsibility or authority being carried
out by the Administrative Committee and to assist in the administration of the
Plan;
(j) to arrange for fiduciary bonding; and
(k) to provide procedures for determination of claims for
benefits;
(l) to take any action necessary or appropriate to assure that
the Plan is administered for the exclusive purpose of providing benefits to
Participants, their Joint Annuitants and Beneficiaries in accordance with the
Plan and defraying reasonable expenses of administering the Plan, subject to
the requirements of any applicable law; and
(m) generally, to operate and administer the Plan, and further,
to make all such decisions, which shall be binding and final, that are
necessary or appropriate for the proper administration of the Plan;
all as further set forth herein.
12.4 Records of Administrative Committee.
(a) Execution of Notices. Any notice, direction, order,
request, certification or instruction of the Administrative Committee to the
Trustee shall be in writing and shall be signed by a member of the
Administrative Committee. The Trustee and every other person shall be entitled
to rely conclusively upon any and all such notices, directions, orders,
requests, certifications and instructions received from the Administrative
Committee and reasonably believed to be properly executed, and shall act and be
fully protected in acting in accordance with any such directions that are
proper.
(b) Preservation of Records. All acts and determinations of the
Administrative Committee shall be duly recorded by its Secretary or under his
supervision, and all such records (including records necessary to demonstrate
compliance with the nondiscrimination requirements of the Code), together with
such other documents as may be necessary for the administration of the Plan,
shall be preserved in the custody of such Secretary.
12.5 Reporting and Disclosure.
The Administrative Committee shall keep all individual and group
records relating to Participants, Joint Annuitants and Beneficiaries and all
other records necessary for the proper operation of the Plan. Such records
shall be made available to the Participating Companies and to each Participant,
Joint Annuitant and Beneficiary for examination during normal business hours
except that a Participant, Joint Annuitant or Beneficiary shall examine only
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such records as pertain exclusively to the examining Participant, Joint
Annuitant or Beneficiary and the Plan and Trust Agreement. The Administrative
Committee shall prepare and shall file as required by law or regulation all
reports, forms, documents and other items required by ERISA, the Code and every
other relevant statute, each as amended, and all regulations thereunder. This
provision shall not be construed as imposing upon the Administrative Committee
the responsibility or authority for the preparation, preservation, publication
or filing of any document required to be prepared, preserved or filed by the
Trustee or by any other Named Fiduciary to whom such responsibilities are
delegated by law or by the Plan.
12.6 Construction of the Plan.
The Administrative Committee shall take such steps as are
considered necessary and appropriate to remedy any inequity that results from
incorrect information received or communicated in good faith or as the
consequence of an administrative error. The Administrative Committee, in its
sole and full discretion, shall interpret the Plan and shall determine the
questions arising in the administration, interpretation and application of the
Plan. The Administrative Committee shall endeavor to act, whether by general
rules or by particular decisions, so as not to discriminate in favor of or
against any person and so as to treat all persons in similar circumstances
uniformly. The Administrative Committee shall correct any defect, reconcile
any inconsistency or supply any omission with respect to the Plan.
12.7 Assistants and Advisers.
(a) Retaining Advisers. The Administrative Committee shall have
the right to hire, at the expense of the Adopting Company (to be divided
equitably among the Participating Companies), such professional assistants and
consultants as it, in its sole discretion, deems necessary or advisable. To
the extent that the costs for such assistants and advisers are not so paid by
the Adopting Company, they shall be paid at the direction of the Administrative
Committee from the Trust Fund as an expense of the Trust Fund.
(b) Reliance on Advisers. The Administrative Committee and the
Participating Companies shall be entitled to rely upon all certificates and
reports made by an accountant, attorney or other professional adviser selected
pursuant to this Section. The Administrative Committee, the Participating
Companies, and the Trustee shall be fully protected in respect to any action
taken or suffered by them in good faith in reliance upon the advice or opinion
of any such accountant, attorney or other professional adviser. Any action so
taken or suffered shall be conclusive upon each of them and upon all other
persons interested in the Plan.
12.8 Bonding.
The Administrative Committee shall arrange for fiduciary bonding
as is required by law, but no bonding in excess of the amount required by law
shall be required by the Plan.
12.9 Indemnification.
The Administrative Committee and each of its members shall be
indemnified by the Participating Companies against judgment amounts, settlement
amounts (other than amounts paid in settlement to which the Participating
Companies do not consent) and expenses, reasonably incurred by the Committee or
member thereof in connection with any action to which the Committee or such
member may be a party (by reason of his service as a member of a Committee)
except in relation to matters as to which the Committee or he shall be adjudged
in such action to be personally guilty of gross negligence or willful
misconduct in the performance of its or his duties. The foregoing right to
indemnification shall be in addition to such other rights as the Committee or
each Committee member may enjoy as a matter of law or by reason of insurance
coverage of any kind. Rights granted hereunder shall be in addition to and not
in lieu of any rights to indemnification to which such Committee or each
Committee member may be entitled pursuant to the by-laws of the Participating
Company. Service on the Administrative Committee shall
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be deemed in partial fulfillment of a member's function as an Employee, officer
and/or director of the Participating Company, if he serves in such other
capacity as well.
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ARTICLE XIII
ALLOCATION OF AUTHORITY AND RESPONSIBILITIES
13.1 Adopting Company and Board.
(a) General Responsibilities. The Adopting Company, as Plan
sponsor, and the Board each shall serve as a Named Fiduciary having the
following authority and responsibilities:
(1) To appoint the Trustee, the Company Stock Trustee and
the Administrative Committee and to monitor each of their performances;
(2) To communicate such information to the Trustee and the
Administrative Committee as each needs for the proper performance of its
duties; and
(3) To provide channels and mechanisms through which the
Administrative Committee and/or the Trustee can communicate with
Participants, Joint Annuitants and Beneficiaries.
In addition, the Adopting Company shall perform such duties as are imposed by
law or by regulation and shall serve as Plan Administrator in the absence of an
appointed Administrative Committee.
(b) Allocation of Authority. In the event any of the areas of
authority and responsibilities of the Adopting Company and the Board overlap
with that of any other Plan fiduciary, the Adopting Company and the Board shall
coordinate with such other fiduciaries the execution of such authority and
responsibilities; provided, the decision of the Adopting Company and the Board
with respect to such authority and responsibilities ultimately shall be
controlling.
(c) Authority of Participating Companies. Notwithstanding
anything herein to the contrary, and in addition to the authority and
responsibilities specifically given to the Participating Companies in the Plan,
the Adopting Company, in its sole discretion, may grant the Participating
Companies such authority and charge them with such responsibilities as the
Adopting Company deems appropriate.
13.2 Administrative Committee.
The Administrative Committee shall have the authority and
responsibilities imposed by Article XII hereof. With respect to said authority
and responsibilities, the Administrative Committee shall be a Named Fiduciary,
and as such, shall have no authority or responsibilities other than as granted
in the Plan or as imposed as a matter of law.
13.3 Trustee.
The Trustee shall be a Named Fiduciary with respect to investment
of Trust Fund assets and shall have the powers and duties set forth in the
Master Trust Agreement, or with respect to the Company Stock Trustee, the
Company Stock Trust Agreement.
13.4 Limitations on Obligations of Fiduciaries.
No fiduciary shall have authority or responsibility to deal with
matters other than as delegated to it under the Plan, under the Trust Agreement
or by operation of law. A fiduciary shall not in any event be liable for
breach of fiduciary responsibility or obligation by another fiduciary
(including Named Fiduciaries) if the responsibility or
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authority for the act or omission deemed to be a breach was not within the
scope of such fiduciary's authority or delegated responsibility.
Without limitation upon the foregoing, the Master Trustee shall
have no responsibility or authority for the acts of the Company Stock Trustee,
and the Company Stock Trustee shall have no responsibility or authority for the
acts or omissions of the Master Trustee.
13.5 Delegation.
Named Fiduciaries shall have the power to delegate specific
fiduciary responsibilities (other than Trustee responsibilities). Such
delegations may be to officers or Employees of a Participating Company or to
other persons, all of whom shall serve at the pleasure of the Named Fiduciary
making such delegation and, if full-time Employees of a Participating Company,
without compensation. Any such person may resign by delivering a written
resignation to the delegating Named Fiduciary. Vacancies created by any reason
may be filled by the appropriate Named Fiduciary or the assigned
responsibilities may be reabsorbed or redelegated by the Named Fiduciary.
13.6 Multiple Fiduciary Roles.
Any person may hold more than one position of fiduciary
responsibility and shall be liable for each such responsibility separately.
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ARTICLE XIV
AMENDMENT, TERMINATION AND ADOPTION
14.1 Amendment of Master Plan.
The Master Plan may be amended at any time and from time to time,
in the sole discretion of the Master Plan Sponsor, effective as of the time
designated by the Master Plan Sponsor, by an instrument in writing executed by
the Master Plan Sponsor, of which each Participating Company is notified in
writing not less than 15 days before such effective date. Each Participating
Company, by executing the Adoption Agreement or Joinder Agreement, as
applicable, shall thereby delegate to the Master Plan Sponsor the power to
amend the Master Plan and shall thereby be deemed to have assented to any such
amendment. Notwithstanding the foregoing, any amendment which is required by
the Internal Revenue Service in order that the Plan and the Trust may qualify
or continue to be qualified, under the applicable provisions of the Code, or
which in the judgment of counsel to the Master Plan Sponsor is necessary or
appropriate to such qualifications or continued qualification, or which in the
judgment of such counsel is necessary or appropriate to otherwise comply with
the provisions of ERISA, may be made effective retroactively or prospectively
without prior notice to any Participating Company.
14.2 Amendment of an Adopting Company's Plan.
(a) Execution of New Adoption Agreement. Each Adopting Company,
by action of the Board, may amend its Plan at any time and from time to time by
amending its Adoption Agreement to adopt any provision which could be adopted
by a new Adopting Company in an Adoption Agreement.
(b) Other Amendment. Except for (i) changes pursuant to
subsection (a) above, (ii) amendments stated in the Adoption Agreement which
allow the Plan to satisfy Code Section 415 and to avoid duplication of benefit
reduction under Code Section 416 due to required aggregation of plans, or (iii)
certain model amendments published by the Internal Revenue Service that
specifically provide that their adoption will not cause the Plan to be treated
as individually designed, if the Adopting Company, by action of the Board,
amends the Plan or the nonelective portions of the Adoption Agreement, the Plan
shall immediately be considered an individually designed plan.
14.3 Limitation on Amendments.
No amendment to the Master Plan or a Plan shall decrease a
Participant's Account balance, eliminate or reduce an early retirement benefit
or a retirement-type subsidy, or eliminate an optional form of benefit with
respect to benefits attributable to service before the amendment. Furthermore,
no amendment to the Master Plan or a Plan shall have the effect of decreasing
the vested portion of a Participant's Account. An Adopting Company, by action
of the Board, may amend its Plan by adding overriding language to the Adoption
Agreement where such language is necessary to satisfy Code Section Section 415
and 416 because of the required aggregation of multiple plans under these
Sections.
14.4 Maintaining Qualified Status.
If a Plan fails to retain its qualified status, such Plan shall no
longer be considered as a Plan under this Master Plan and will be considered an
individually designed plan.
14.5 Termination.
(a) Right to Terminate. By establishing a Plan hereunder each
Participating Company represents that such Plan is intended to be a permanent
and continuing program for providing benefits to the Participants therein, but
each Adopting Company nevertheless reserves the right to terminate its Plan at
any time or to completely discontinue
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Contributions to the Plan at any time by action of the Board. In either event,
the Administrative Committee, each Participating Company and the Trustee shall
be promptly advised of such decision in writing. [For termination of the Plan
by a Participating Company as to itself (rather than the termination of the
entire Plan) refer to Section 14.6(e).]
(b) Vesting Upon Complete Termination. If the Plan is
terminated or frozen by the Adopting Company or Contributions to the Plan are
completely discontinued, the Accounts of all Participants, Joint Annuitants,
Beneficiaries or other successors in interest as of such date shall become 100
percent vested and nonforfeitable. Upon termination of the Plan, the
Administrative Committee, in its sole discretion, shall instruct the Trustee
either (i) to continue to manage and administer the assets of the Trust for the
benefit of the Participants and their Joint Annuitants and Beneficiaries
pursuant to the terms and provisions of the Trust Agreement, or (ii) if there
is no successor plan permitted under the terms of Section 10.1(c) or Section
11.1(c) or no benefits subject to the restrictions in said Sections, to pay
over to each Participant the value of his interest in a single sum; provided,
such payment shall be subject to the provisions of Section 14.5(c). If the
Administrative Committee instructs the Trustee to continue to manage and
administer the assets of the Trust pursuant to clause (i), then the Plan shall
continue to be kept in compliance with all applicable laws and Internal Revenue
service regulations; investment earnings and losses shall continue to be
allocated among Accounts in accordance with the Plan and Trust Agreement; and
the Plan will be deemed to be frozen rather than terminated.
(c) Liquidation of Plan Assets. In the event that the
Administrative Committee decides to distribute the assets of the Plan then held
in the Trust, as soon as administratively feasible following the termination of
the Plan or the Administrative Committee's decision, whichever is later, the
assets under the Plan shall be converted to cash or other distributable assets,
to the extent necessary to effect a complete distribution of such assets as
described hereinbelow. Following completion of the conversion, on a date
selected by the Administrative Committee, each individual with an Account under
the Plan on such date shall receive a distribution of the total amount then
credited to his Account; provided, if (i) either (A) the Adopting Company has
elected Section 11.1 of the Adoption Agreement, or (B) the Participating
Company or any of its Affiliates then maintains another qualified retirement
plan other than an employee stock ownership plan [as defined in Code Section
4975(e)]; and (ii) the balance of a Participant's Account is greater than
$3,500; and (iii) such Participant does not consent to a lump sum distribution,
the Administrative Committee shall direct that the Participant's Account be
distributed by the purchase and distribution of a non- transferable
nonparticipating annuity with distribution terms comparable to those in Section
11.1 (and the applicable provisions in Article XI) and which otherwise complies
with Code Section 401(a)(9), the regulations thereunder, and the terms of the
Plan. The amount of cash and other property distributable to each such
individual shall be determined as of the date of distribution (treating, for
this purpose, such distribution date as the Valuation Date as of which the
distributable amount is determined). In the case of a termination distribution
as provided herein, the Administrative Committee may direct the Trustee to take
any action provided in Section 10.10 or Section 11.13 (dealing with unclaimed
benefits), except that it shall not be necessary to hold funds for any period
of time stated in such Section. Within the expense limitations set forth in
the Plan, the Administrative Committee may direct the Trustee to use assets of
the Trust Fund to pay any due and accrued expenses and liabilities of the Trust
and any expenses involved in termination of the Plan (other than expenses
incurred for the benefit of the Participating Companies).
(d) Vesting Upon Partial Termination. In the event of a partial
termination of the Plan, the Accounts of those Participants, Joint Annuitants
and Beneficiaries affected shall become 100 percent vested and nonforfeitable
and, unless transferred to another qualified plan in accordance with the terms
of Section 5.3, shall be distributed in a manner and at a time consistent with
the terms of Article X or Article XI.
14.6 Adoption of the Plan by Affiliates.
(a) Procedures for Participation. The Adopting Company shall
become a Participating Company in the Plan on the Effective Date. Any other
Affiliate may become a Participating Company and commence participation in the
Plan subject to the provisions of this subsection. In order for an Affiliate
to become a Participating Company, (i) the Affiliate must enter into a Joinder
Agreement; (ii) the Administrative Committee must accept such Joinder
Agreement; and (iii) the Master Plan Sponsor and the Boards of Directors of the
Affiliate and the Adopting Company must approve the Joinder Agreement. The
Joinder Agreement shall specify the date as of which the Affiliate's
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participation in the Plan shall be effective and shall specify that the
Affiliate shall be subject to and bound by the Plan and the Trust. A copy of
the Joinder Agreement shall be provided to the Administrative Committee. Upon
adoption of the Plan by an Affiliate as herein provided, the Employees of such
company shall be eligible to participate in the Plan subject to the terms
thereof and of the Joinder Agreement.
(b) Single Plan. The Plan, as adopted by an Adopting Company
and its related Participating Companies pursuant to a particular Adoption
Agreement and any Joinder Agreements, shall be considered a single plan for
purposes of Treasury Regulation Section 1.414(l)-1(b)(1). All assets
contributed to the Plan by such Participating Companies shall be held in a
single fund together; and, as long as a Participating Company continues to be
designated as such, all assets held in such fund shall be available to pay
benefits to all Participants, Joint Annuitants and Beneficiaries irrespective
of which Participating Company is the employer of such Participant. Nothing
contained herein shall be construed (i) to create a single plan as among
Participating Companies which are not parties to such Plan, Adoption Agreement
and/or Joinder Agreement; or (ii) to prohibit the separate accounting for
assets contributed by the Participating Companies for purposes of cost
allocation, contributions, forfeitures and other purposes, pursuant to the
terms of the Plan and as directed by the Administrative Committee.
(c) Authority under Plan. As long as a Participating Company's
designation as such remains in effect, such Participating Company shall be
bound by, and subject to, all provisions of the Plan and the Trust. Subject to
Section 14.2, the exclusive authority to amend the Plan shall be vested in the
Adopting Company, and no Participating Company other than the Adopting Company
shall have any right to amend the Plan. Any amendment to the Plan adopted by
the Adopting Company shall be binding upon every Participating Company without
further action by such Participating Company.
(d) Contributions to Plan. As long as each Participating
Company is a Participating Company, it shall be required to make Contributions
to the Plan at such times and in such amounts as specified in Articles IV and
VII. The Contributions made (or to be made) to the Plan by the Participating
Companies shall be allocated between and among such companies in whatever
equitable manner or amounts as the Administrative Committee shall determine.
(e) Procedure for Withdrawal from Plan. No Participating
Company other than the Adopting Company shall have the right to terminate the
Plan. However, any Participating Company may withdraw from the Plan, with the
approval of the Adopting Company, by action of its board of directors, provided
such action is communicated in writing to the Adopting Company. The withdrawal
of a Participating Company shall be effective as of the last day of the Plan
Year which follows receipt of the notice of withdrawal (unless the Adopting
Company consents to a different effective date). In addition, the Adopting
Company may terminate the designation of a Participating Company to be
effective on such date as the Adopting Company specifies.
(f) Effect of Withdrawal from Plan. Any Participating Company
that ceases to be a Participating Company shall be liable for all costs and
liabilities (whether imposed under the terms of the Plan, the Code or ERISA)
accrued through the effective date of its withdrawal or termination. The
Participating Company's cessation of Plan participation shall not necessarily
be a partial termination, but that shall be determined on a case-by-case basis
through application of the appropriate legal standards. In the event of the
withdrawal or termination of a Participating Company as provided in this
Section, such Participating Company shall have no right to direct that assets
of the Plan be transferred to a successor plan for its employees, unless such
transfer is approved by the Administrative Committee in its sole discretion.
14.7 Merger, Consolidation and Transfer of Assets or Liabilities.
(a) Mergers and Spin-offs Accepted. The Administrative
Committee, in its sole discretion, may permit other qualified retirement plans
to transfer assets and liabilities to the Plan as part of a merger, spin-off or
similar transaction. The plan benefit of a Participant who participated in
such other plan and whose benefit is transferred to the Plan shall be
determined in accordance with any Appendix 1 of the Adoption Agreement. Any
merger, consolidation or transfer pursuant to this Section shall be made in
accordance with the terms of the Code and
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subject to such rules and requirements as the Administrative Committee may deem
appropriate. Without limiting the generality of the foregoing, as a condition
to permitting any such merger, consolidation or transfer, the requirements of
Code Section 411(d)(6) must be satisfied and Appendix 1 of the Adoption
Agreement shall set forth the protected benefits [within the meaning of Code
Section 411(d)(6)] provided under such other plan which are not provided under
the Plan, and which shall be preserved, but only with respect to benefits that
have accrued under such other plan as of the effective date of the merger,
transfer or consolidation. Any transfer hereunder shall be made in accordance
with the terms of the Code and subject to such rules and requirements as the
Administrative Committee may deem appropriate.
(b) Spin-offs to Other Plans. The Administrative Committee, in
its sole discretion, may cause the Plan to transfer to another qualified
retirement plan (as part of a spin-off or similar transaction) assets and
liabilities maintained under the Plan. Any such transfer shall be made in
accordance with the terms of the Code and subject to such rules and
requirements as the Administrative Committee may deem appropriate. Upon the
effectiveness of any such transfer, the Plan and Trust shall have no further
responsibility or liability with respect to the transferred assets and
liabilities.
(c) Statutory Requirements. In the event of any merger or
consolidation of the Plan with, or transfer of assets or liabilities of the
Plan to or from, any other plan, each Participant and Beneficiary shall have a
plan benefit in the surviving or transferee plan (determined as if such plan
were then terminated immediately after such merger, consolidation or transfer
of assets or liabilities) that is equal to or greater than the benefit he would
have been entitled to receive under the Plan or other plan immediately before
such merger, consolidation or transfer of assets or liabilities, if the Plan or
other plan, as applicable, had terminated at that time.
14.8 Contingent Adoption.
Notwithstanding anything to the contrary elsewhere provided in the
Plan and the Trust Agreement, the initial adoption of the Plan and Trust by an
Adopting Company shall be contingent upon the Plan and Trust initially being
approved and qualified by the Internal Revenue Service with respect to such
Adopting Company and any related Participating Companies as meeting the
requirements of the Code and the regulations issued thereunder, so as to permit
the Participating Companies to claim a credit or deduction for income tax
purposes with respect to all funds contributed by them to the Trust and so as
to make the Trust tax exempt under the present Code Section 501(a); and, in the
event qualification is not obtained, the Plan shall thereupon become null and
void and of no effect, ab initio, with respect to such Participating Companies,
and the Trustee shall forthwith deliver to each such Participating Company all
of the property of such Trust upon request of such Participating Company. If
the Plan fails to attain or retain qualification, the Plan will no longer
participate in the Master Plan and will be considered an individually designed
plan.
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ARTICLE XV
TOP-HEAVY PROVISIONS
15.1 Top-Heavy Plan Years.
The provisions set forth in this Article XV shall become effective
for any Plan Years with respect to which the Plan is determined to be a
Top-Heavy Plan and shall supersede any other provisions of the Plan which are
inconsistent with these provisions; provided, if the Plan is determined not to
be a Top-Heavy Plan in any Plan Year subsequent to a Plan Year in which the
Plan was a Top-Heavy Plan, the provisions of this Article XV shall not apply
with respect to such subsequent Plan Year, except as set forth in Section 15.2
of the Adoption Agreement; and, provided, further, to the extent that any of
the requirements of this Article XV shall no longer be required under Code
Section 416 or any other section of the Code, such requirements shall be of no
force or effect.
15.2 Determination of Top-Heavy Status.
(a) Application. The Plan will be considered a Top-Heavy Plan
for a Plan Year if either:
(1) the Plan is not part of a Required Aggregation Group
or a Permissive Aggregation Group and, as of the Determination Date of
such Plan Year, the value of the Accounts of the Participants who are Key
Employees under the Plan exceeds 60 percent of the value of the Accounts
of all Participants; or
(2) the Plan is part of a Required Aggregation Group
which, as of the Determination Date of such Plan Year, is a Top-Heavy
Group;
provided, the Plan shall not be considered a Top-Heavy Plan for a Plan Year
under subsection (a)(2) hereof if the Plan also is part of a Permissive
Aggregation Group which is not a Top-Heavy Group for such Plan Year. The
amount of Participants' Accounts shall be the total of their accounts under all
defined contribution plans and simplified employee pension plans (within the
meaning of Code Section 408) that are part of any Required or Permissive
Aggregation Group, plus the present value of accrued benefits under all
aggregated defined benefit plans, all determined in accordance with Code
Section 416 and the regulations issued thereunder. For purposes hereof, the
accrued benefit of a Participant other than a Key Employee shall be determined
under (i) the method, if any, that uniformly applies for accrual purposes under
all defined benefit plans maintained by the Affiliates, or (ii) if there is no
such method, as if such benefit accrued not more rapidly than the slowest
accrual rate permitted under the fractional rule of Code Section 411(b)(1)(C).
Present value shall be based only on the interest and mortality rates specified
in Section 15.4 of the Adoption Agreement.
(b) Special Definitions.
(1) Determination Date. The term "Determination Date"
shall mean (i) in the case of the Plan Year that includes the Effective
Date of the Plan, the last day of such Plan Year, and (ii) with respect
to any other Plan Year of the Plan, the last day of the immediately
preceding Plan Year and (iii) for any plan year of each other qualified
plan maintained by a Participating Company or Affiliate which is part of
a Required or Permissive Aggregation Group, the date determined under (i)
or (ii) above as if the term "Plan Year" means the plan year for each
such other qualified plan. The date of the Determination Date shall
always be a valuation date under the applicable plan for purposes of
valuing the account balances or accrued benefits for purposes of
determining whether the Plan is top heavy.
(2) Key Employee. The term "Key Employee" shall mean an
Employee defined in Code Section 416(i) and the Treasury regulations
thereunder. Generally, Key Employee shall mean an Employee, former
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Employee or deceased Employee (and the beneficiaries of any such
Employee) who, at any time during the Plan Year or the 4 previous Plan
Years, was either:
(A) an officer of an Affiliate having a combined
annual Compensation [as defined in Section 2.29] from all
Affiliates greater than 50 percent of the amount in effect under
Code Section 415(b)(1)(A) for any such Plan Year; provided, no
less than one nor more than fifty individuals shall be treated as
officers of an Affiliate;
(B) one of the ten individuals owning [or considered
as owning under Code Section 318, as modified by Code Section
416(i)(1)(B)(iii)] the largest percentage ownership interests in
value in the Affiliates (as more fully described in Treasury
Regulation Section 1.416-1, T-19 and T-20) and having a combined
annual Compensation [as defined in Section 2.29] from all
Affiliates of more than the limitation in effect under Code
Section 415(c)(1)(A);
(C) a 5-percent owner [or constructive owner within
the meaning of Code Section 318, as modified by Code Section
416(i)(1)(B)(iii)] of an Affiliate; or
(D) a 1-percent owner [or constructive owner within
the meaning of Code Section 318, as modified by Code Section
416(i)(1)(B)(iii) and the Treasury regulations thereunder] of an
Affiliate having a combined annual Compensation [as defined in
Section 2.29] from all Affiliates of more than $150,000.
For purposes of subsection (B) hereof, if two individuals have the same
percentage ownership interest in an Affiliate, the individual having
greater combined annual Compensation from all Affiliates shall be treated
as having the larger interest. In determining percentage ownership
hereunder, employers that otherwise would be aggregated under Code
Section Section 414(b), (c) and (m) shall be treated as separate
employers.
(3) Non-Key Employee. The term "Non-Key Employee" shall
mean any Employee who is not a Key Employee. For purposes hereof, former
Key Employees shall be treated as Non-Key Employees.
(4) Permissive Aggregation Group. The term "Permissive
Aggregation Group" shall mean a Required Aggregation Group and any other
qualified plan or plans maintained or contributed to by an Affiliate
which, when considered with the Required Aggregation Group, would
continue to satisfy the requirements of Code Section Section 401(a)(4)
and 410.
(5) Required Aggregation Group. The term "Required
Aggregation Group" shall mean a group of plans of the Affiliates
consisting of (i) each plan which, for such Plan Year or any of the 4
preceding Plan Years, qualifies under Code Section 401(a) and in which a
Key Employee is a participant, and (ii) each other plan which, during
this 5-year period, qualifies under Code Section 401(a) and which enables
any plan described in clause (i) hereof to satisfy the requirements of
Code Section Section 401(a)(4) or 410.
(6) Top-Heavy Group. The term "Top-Heavy Group" shall
mean a Required or Permissive Aggregation Group with respect to which the
sum (determined as of a Determination Date) of (i) the present value of
the cumulative accrued benefits for Key Employees under all Defined
Benefit Plans included in such group, and (ii) the aggregate of the
accounts of Key Employees under all Defined Contribution Plans included
in such group, exceeds 60 percent of a similar sum determined for all
Employees. The present value of the cumulative accrued benefits shall be
determined in accordance with the interest rate and mortality assumptions
specified in Section 15.4 of the Adoption Agreement.
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(c) Special Rules. The following rules shall apply in
determining whether the Plan is a Top-Heavy Plan under subsection (a)(1) or
(a)(2) above:
(1) The value of any account balance under any Defined
Contribution Plan and the value of any accrued benefit under any Defined
Benefit Plan shall be determined as of the most recent valuation date
that falls within, or ends with, the 12-month period ending on the
Determination Date or, if plans are aggregated, the Determination Dates
that fall within the same calendar year;
(2) The value of the Accounts under the Plan or the
accounts under any other Defined Contribution Plan included in a Required
or Permissive Aggregation Group for any Determination Date, other than
the Determination Date for the first plan year, shall include the amounts
actually contributed and paid to the plan on or before the Determination
Date, and shall exclude any amounts to be contributed with respect to
such preceding plan year but not actually paid to the plan on or before
the Determination Date. The value of the accounts under any Defined
Contribution Plan for the Determination Date of the first plan year shall
include all amounts contributed to the plan as of the Determination Date,
regardless of whether such amounts shall have been actually paid or
merely accrued as of the Determination Date;
(3) The value of any account balance under any Defined
Contribution Plan and the present value of any accrued benefit under any
Defined Benefit Plan as of any Determination Date shall be increased by
the aggregate distributions made under the plan during the 5-year period
ending on the Determination Date;
(4) Accrued benefits and accounts of the following
individuals shall not be taken into account for a Plan Year: (A) any
Non-Key Employee who, in a prior Plan Year, was a Key Employee or (B) any
Employee who had not performed any services for a Participating Company
at any time during the 5-year period ending on the Determination Date for
such Plan Year;
(5) The value of any account balance shall not include
deductible employee contributions, as described in Code Section
72(o)(5)(A);
(6) The extent to which rollovers and plan to plan
transfers are taken into account in determining the value of any account
balance or accrued benefit shall be determined in accordance with Code
Section 416 and the regulations thereunder; and
(7) Effective for plan years beginning after December 31,
1986, each Non-Key Employee's accrued benefit under the Plan and any
other Defined Benefit Plans shall be determined (A) under the method, if
any, that uniformly applies for accrual purposes under all Defined
Benefit Plans, or (B) if there is no such method, as if such benefit
accrued not more rapidly than the slowest accrual rate permitted under
the fractional accrual rate set forth under Code Section 411(b)(1)(C).
15.3 RESERVED
15.4 Top-Heavy Minimum Contribution.
(a) Multiple Defined Contribution Plans. For any Plan Year in
which the Plan is a Top-Heavy Plan, the aggregate Company Contributions (when
added to similar contributions made under other defined contribution plans)
allocated to the Account of any Active Participant who is a Non-Key Employee
shall not be less than the Defined Contribution Minimum. To the extent the
Company Contributions to the Plan for such Plan Year are less than the Defined
Contribution Minimum, any additional Company Contributions shall be provided by
the plan elected pursuant to Section 15.3 of the Adoption Agreement.
For purposes hereof, a Non-Key Employee shall not fail to receive
a minimum contribution hereunder for a Plan Year because (i) such Non-Key
Employee fails to complete 1,000 Hours of Service for such Plan Year or
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(ii) such Non-Key Employee is excluded from participation (or receives no
allocation) merely because his Compensation is less than a stated amount or
because he failed to make a Deferral Election for such Plan Year.
(b) Defined Contribution and Benefit Plans. In the event that
Non-Key Employees are covered under both the Plan and one or more Defined
Benefit Plans maintained by an Affiliate, the minimum contribution level set
forth in subsection (a) hereof shall be satisfied if each such Non-Key Employee
receives a benefit level under such Defined Contribution and Defined Benefit
Plans which is not less than the Defined Benefit Minimum offset by any benefits
provided under the Plan and any other Defined Contribution Plans maintained by
any Affiliate.
(c) Defined Contribution Minimum. The term "Defined
Contribution Minimum" means, with respect to the Plan, a minimum level of
Company Contributions allocated with respect to a Plan Year to the Account of
each Active Participant who is a Non-Key Employee; such level being the lesser
of:
(1) 3 percent of such Active Participant's Compensation
for such Plan Year; or
(2) if no Defined Benefit Plan of an Affiliate uses the
Plan to satisfy the requirements of Code Section Section 401(a)(4) or
410, the highest percentage of Compensation at which Company
Contributions are made, or are required to be made, under the Plan for
such Plan Year for any Key Employee.
For purposes of this subsection, (i) qualified, nonelective contributions made
by the Company in order to satisfy the anti-discrimination tests of Code
Section 401(k) or Section 401(m) (for example, Supplemental Contributions) may
be treated as Company Contributions; (ii) Before Tax and Matching Contributions
shall be taken into account as Company Contributions for Key Employees; (iii)
Matching Contributions may be treated as Company Contributions and may be taken
into account for satisfying the Minimum Contribution Requirement for Non-Key
Employees, but only if such Matching Contributions are not treated as Matching
Contributions for purposes of the ADP Tests or Code Section 401(m) and instead
satisfy the requirements of Code Section 401(a)(4) as Company Contributions;
and (iv) Before Tax Contributions shall not be taken into account for
satisfying the Minimum Contribution Requirement for Non-Key Employees.
(d) Defined Benefit Minimum. The term "Defined Benefit Minimum"
means, with respect to a Defined Benefit Plan, a minimum level of accrued
benefit derived from employer contributions with respect to a plan year for
each participant who is a Non-Key Employee; such level, when expressed as a
life annuity commencing at Normal Retirement Age, being not less than the
product of (1) and (2), where:
(1) equals the Non-Key Employee's average Compensation for
the period of consecutive years (not exceeding 5) when such Non-Key
Employee had the highest aggregate Compensation from all Affiliates; and
(2) equals the lesser of (A) 2 percent times such Non-Key
Employee's number of years of service or (B) 20 percent.
For purposes of determining the Defined Benefit Minimum, "years of service"
shall not include any year of service if the plan was not a Top-Heavy Plan for
the plan year ending during such year of service and shall not include any
years of service completed in a plan year beginning before January 1, 1984.
Compensation in years before January 1, 1984, and Compensation in years after
the close of the last plan year in which the plan is a Top-Heavy Plan shall be
disregarded. All accruals of employer-provided benefits, whether or not
attributable to years for which the Plan is top-heavy, may be used in computing
whether the minimum contribution requirements set forth in this Section are
satisfied.
15.5 Top-Heavy Minimum Vesting.
(a) Schedule. For any Plan Year in which the Plan is determined
to be a Top-Heavy Plan, the vesting schedule set forth in Section 15.1 of the
Adoption Agreement shall apply and shall be substituted in lieu of the schedule
in
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Section 9.1 of the Adoption Agreement for any Employee who has an Hour of
Service after the Plan initially became top- heavy and while the top-heavy
vesting schedule set forth in Section 15.1 of the Adoption Agreement is in
effect.
(b) Post-Top Heavy Periods. Unless otherwise elected pursuant
to Section 15.2 of the Adoption Agreement, in the event the Plan after being a
Top-Heavy Plan ceases to be such, the vesting schedule in Section 15.1 of the
Adoption Agreement shall continue to apply only to the portion of each
Participant's Account as existed on the last day of the Top-Heavy Plan Year;
provided, any Participant who had at least 3 Years of Vesting Service shall be
permitted to elect, within a reasonable time determined by the Administrative
Committee, to have his vested percentage determined under the schedule set
forth in Section 15.1 of the Adoption Agreement.
15.6 Adjustments in Code Section 415 Limitations for Top-Heavy Plans.
(a) Special Adjustment. In the event that, during a Plan Year
in which the Plan is a Top-Heavy Plan, an individual is a participant in both a
Defined Benefit Plan and a Defined Contribution Plan maintained by an
Affiliate, the computation of the Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction, as set forth in Section Section 7.7(e)(iii) and (v)
hereof, shall be modified by substituting "100 percent" for "125 percent" each
time it appears in said subsections; provided, in the event that the
requirements set forth in subsection (b) hereof are satisfied, the
modifications otherwise required by this subsection (a) shall not be required
and shall be of no effect.
(b) Exception. In the event that:
(1) the Plan would not be a Top-Heavy Plan if "90 percent"
were substituted for "60 percent" each time it appears in Section
15.2(a)(1) and in the definition of Top-Heavy Group in Section
15.2(b)(6);
(2) the Plan would continue to satisfy the requirements of
Section 15.4 hereof if "3 percent" were substituted for "2 percent" each
time it appears in Section 15.4(d), and if "20 percent", as used in
Section 15.4(d), were increased by one percentage point (but not by more
than 10 percentage points) for each year for which the plan was taken
into account under this Section 15.6; and
(3) the Plan would continue to satisfy the requirements of
Section 15.4 hereof if "4 percent" were substituted for "3 percent" each
time it is used in Section 15.4(c);
then, the substitution of "100 percent" for "125 percent" as otherwise required
in subsection (a) hereof, shall not be required or effected.
15.7 Special Effective Date.
The provisions of this Article generally are effective as of the
Effective Date, but to the extent the Code requires an earlier or later
effective date with respect to any portion(s) of this Article, such other
effective date shall apply.
15.8 Construction of Limitations and Requirements.
The descriptions of the limitations and requirements set forth in
this Article are intended to serve as statements of the minimum legal
requirements necessary for the Plan to remain qualified under the applicable
terms of the Code. The Adopting Company does not desire or intend, and the
terms of this Article shall not be construed, to impose any more restrictions
on the operation of the Plan than required by law. Therefore, the terms of
this Article and any related terms and definitions in the Plan shall be
interpreted and operated in a manner which imposes the least restrictions on
the Plan. For example, if use of a more liberal definition of "Compensation"
is permissible at any time under the law, then the more liberal provisions may
be applied as if such provisions were included in the Plan.
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ARTICLE XVI
MISCELLANEOUS
16.1 Nonalienation of Benefits and Spendthrift Clause.
(a) General Nonalienation Requirements. Except to the extent
permitted by law and as provided in subsections (b) and (c) hereof, none of the
Accounts, benefits, payments, proceeds or distributions under the Plan shall be
subject to the claim of any creditor of a Participant or Beneficiary or to any
legal process by any creditor of such Participant or of such Beneficiary; and
neither such Participant nor any such Beneficiary shall have any right to
alienate, commute, anticipate or assign any of the Accounts, benefits,
payments, proceeds or distributions under the Plan except to the extent
expressly provided herein.
(b) Exception for Qualified Domestic Relations Orders.
(1) The nonalienation requirements of subsection (a)
hereof shall apply to the creation, assignment or recognition of a right
to any benefit, payable with respect to a Participant pursuant to a
domestic relations order, unless such order is (i) determined to be a
qualified domestic relations order, as defined in Code Section 414(p),
entered on or after January 1, 1985, or (ii) any domestic relations
order, as defined in Code Section 414(p), entered before January 1, 1985,
pursuant to which a transferor plan was paying benefits on January 1,
1985. The Administrative Committee shall establish reasonable written
procedures to determine the qualified status of a domestic relations
order. Further, to the extent provided under a qualified domestic
relations order, a former spouse of a Participant shall be treated as the
Spouse or Surviving Spouse for all purposes under the Plan.
(2) The Administrative Committee shall establish
reasonable procedures to administer distributions under qualified
domestic relations orders which are submitted to it. The Administrative
Committee, to the extent provided in a qualified domestic relations
order, shall direct the Trustee to pay, in a single sum payment, the full
amount of the benefit payable to any alternate payee under a qualified
domestic relations order. Such cash- out payment may be made as soon as
practicable after the end of the month within which the Administrative
Committee determines that a domestic relations order is a qualified
domestic relations order under Code Section 414(p) or if later, when the
terms of the qualified domestic relations order permit such a
distribution. [See also Section 10.5 or Section 11.8.] If the terms of
a qualified domestic relations order do not permit an immediate cash-out
payment, the benefits shall be paid to the alternate payee in accordance
with the terms of the Plan and such order.
(c) Exception for Loans from the Plan. All loans made by the
Trustee to any Participant or Beneficiary shall be secured by a pledge of the
borrower's interest in the Plan.
16.2 Headings.
The headings and subheadings in the Plan have been inserted for
convenience of reference only and are to be ignored in any construction of the
provisions hereof. Unless otherwise explicitly indicated to the contrary, each
reference herein, to "Section ", "Section" or "subsection", shall be a
reference to the Master Plan.
16.3 Construction, Controlling Law.
In the construction of the Plan, the masculine shall include the
feminine and the feminine the masculine, and the singular shall include the
plural and the plural the singular, in all cases where such meanings would be
appropriate. Unless otherwise specified, any reference to a section shall be
interpreted as a reference to a section of
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the Master Plan. The Plan shall be construed in accordance with the laws of
the State of Georgia and applicable federal laws.
16.4 No Contract of Employment.
Neither the establishment of the Plan, nor any modification
thereof, nor the creation of any fund, trust or account, nor the payment of any
benefits shall be construed as giving any Participant, Employee or any person
whomsoever the right to be retained in the service of any Affiliate, and all
Participants and other Employees shall remain subject to discharge to the same
extent as if the Plan had never been adopted.
16.5 Legally Incompetent.
The Administrative Committee may in its discretion direct that
payment be made and the Trustee shall make payment on such direction, directly
to an incompetent or disabled person, whether incompetent or disabled because
of minority or mental or physical disability, or to the guardian of such person
or to the person having legal custody of such person, without further liability
with respect to or in the amount of such payment either on the part of any
Participating Company, the Administrative Committee or the Trustee.
16.6 Heirs, Assigns and Personal Representatives.
The Plan shall be binding upon the heirs, executors,
administrators, successors and assigns of the parties, including each
Participant, Beneficiary and Joint Annuitant, present and future.
16.7 Title to Assets, Benefits Supported Only By Trust Fund.
No Participant, Beneficiary or Joint Annuitant shall have any
right to, or interest in, any assets of the Trust Fund upon separation from
service or otherwise, except as provided from time to time under the Plan, and
then only to the extent of the benefits payable under the Plan to such
Participant out of the assets of the Trust Fund. Any person having any claim
under the Plan shall look solely to the assets of the Trust Fund for
satisfaction. The foregoing sentence notwithstanding, each Participating
Company shall indemnify and save any of its officers, members of its board of
directors or agents, and each of them, harmless from any and all claims, loss,
damages, expense and liability arising from their responsibilities in
connection with the Plan and from acts, omissions and conduct in their official
capacity, except to the extent that such effects and consequences shall result
from their own willful misconduct or gross negligence.
16.8 Legal Action.
In any action or proceeding involving the assets held with respect
to the Plan or Trust Fund or the administration thereof, the Participating
Companies, the Administrative Committee and the Trustee shall be the only
necessary parties and no Participants, Employees, or former Employees of the
company, their Beneficiaries or any other person having or claiming to have an
interest in the Plan shall be entitled to any notice of process; provided, that
such notice as is required by the Internal Revenue Service and the Department
of Labor to be given in connection with Plan amendments, termination,
curtailment or other activity shall be given in the manner and form and at the
time so required. Any final judgment which is not appealed or appealable that
may be entered in any such action or proceeding shall be binding and conclusive
on the parties hereto, the Administrative Committee and all persons having or
claiming to have an interest in the Plan.
16.9 No Discrimination.
The Adopting Company, through the Administrative Committee, shall
administer the Plan in a uniform and consistent manner with respect to all
Participants, Beneficiaries and Joint Annuitants and shall not permit
discrimination in favor of officers, stockholders, supervisory or Highly
Compensated Employees.
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16.10 Severability.
If any provisions of the Plan shall be held invalid or
unenforceable, such invalidity or unenforceability shall not affect any other
provisions hereof, and the Plan shall be construed and enforced as if such
provisions had not been included; provided, this Section notwithstanding, if
the events described in Section 14.8 shall occur, then Section 14.8 shall
control.
16.11 Exclusive Benefit; Refund of Contributions.
No part of the Trust Fund shall be used for or diverted to
purposes other than the exclusive benefit of the Participants and their
Beneficiaries, subject, however, to the payment of all costs of maintaining and
administering the Plan and Trust. Notwithstanding the foregoing, Contributions
to the Trust by a Participating Company may be refunded to the Participating
Company under the following circumstances and subject to the following
limitations:
(a) Permitted Refunds. If and to the extent permitted by the
Code and other applicable laws and regulations thereunder, upon the
Participating Company's request, a Contribution which is (i) made by a mistake
in fact, or (ii) conditioned upon initial qualification of the Plan with the
Plan receiving an adverse determination even though the application for
determination is submitted to the Internal Revenue Service for review within
the remedial amendment period (as defined in Treasury Regulation Section
1.401(b)-1) respecting the Plan, or (iii) conditioned upon the deductibility of
the Contribution under Code Section 404, shall be returned to the Participating
Company making the Contribution within 1 year after the payment of the
Contribution, the denial of the qualification, or the disallowance of the
deduction (to the extent disallowed), whichever is applicable.
(b) Payment of Refund. If any refund is paid to a Participating
Company hereunder, such refund shall be made without interest or other
investment gains, shall be reduced by any investment losses attributable to the
refundable amount and shall be apportioned among the Accounts of the
Participants as an investment loss, except to the extent that the amount of the
refund can be attributed to one or more specific Participants (for example, as
in the case of certain mistakes of fact), in which case the amount of the
refund attributable to each such Participant's Account shall be debited
directly against such Account.
(c) Limitation on Refund. No refund shall be made to a
Participating Company if such refund would cause the balance in a Participant's
Account to be less than the balance would have been had the refunded
contribution not been made.
16.12 Predecessor Service.
In the event a Participating Company maintains the Plan as
successor to a predecessor employer who maintained the Plan, service for the
predecessor employer shall be treated as service for the Participating Company.
To the extent required under the Code or ERISA or otherwise designated by the
Administrative Committee, in the event assets and liabilities of a qualified
retirement plan are transferred, merged or consolidated with the Plan, service
with the employer who maintained the transferring plan shall be treated as
service for the Participating Company.
16.13 Plan Expenses.
As permitted under the Code and ERISA, expenses incurred with
respect to administering the Plan and Trust shall be paid by the Trustee from
the Trust Fund to the extent such costs are not paid by the Participating
Companies.
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16.14 Special Effective Dates.
(a) Intent of Plan. The Plan generally is effective as of the
Effective Date. The Plan is intended to be in compliance with all current laws
and regulations, including the following laws and regulations (which are listed
in Section 4 of IRS Revenue Procedure 88-42):
(1) Titles XI and XVIII of the Tax Reform Act of 1986;
(2) Subtitle C of Title IX of the Omnibus Budget
Reconciliation Act of 1986;
(3) Sections 9343(c) and 9346 of the Omnibus Budget
Reconciliation Act of 1987;
(4) Optional Form of Benefit Regulations;
(5) Temporary regulations under Code Section Section
414(q) and (s);
(6) Proposed regulations under Code Section Section
401(a)(9), 410 and 411;
(7) Notice 87-20, regarding amendments to Code Section
Section 411(a)(11)(B) and 417(e)(3) made by Section 1139 of the Tax
Reform Act of 1986;
(8) Notice 87-21, regarding changes to Code Section 415
made by the Tax Reform Act of 1986; and
(9) Rev. Rule 86-74, regarding changes to the plan
integration rules resulting from the Social Security Amendments of 1983.
In addition, the Plan is intended to include all provisions required by the
Technical Corrections and Miscellaneous Revenue Act of 1988.
(b) Compliance. To the extent any of the changes and provisions
described above have requisite effective dates other than the Effective Date,
the Plan shall be deemed to be effective as of such requisite effective dates
solely for the purpose of satisfying the applicable legal and regulatory
requirements.
16.15 Purpose and Applicability.
(a) Purpose. The purpose of each Plan adopted by a
Participating Company shall be to provide benefits to Participants under the
Plan upon retirement, Disability, death and separation from service, all upon
the terms and conditions, and subject to the limitations, contained herein.
(b) Applicability. The provisions of each Plan adopted by a
Participating Company as a new plan, or each Plan adopted by a Participating
Company as a restatement of a Prior Plan, shall apply only to persons employed
by such company on and after the Effective Date of the Plan. Except for the
Plan's provisions affecting the payment of benefits, if this Plan is a
restatement of a Prior Plan, the rights and benefits of Participants who were
employed by the Participating Company prior to the Effective Date of the Plan,
but who were not employed on or after such Effective Date, shall be determined
in accordance with the provisions of the Prior Plan in effect on the date they
separated from service.
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IN WITNESS WHEREOF, the Master Plan Sponsor has caused the Master Plan to
be executed by its duly authorized officer, as of the date first above written.
GEORGIA BANKERS ASSOCIATION
By: /s/ John J. Brannen
---------------------------
Title: President
------------------------
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EXHIBIT 5
OPINION OF TROUTMAN SANDERS LLP
May 14, 1997
Appalachian Bancshares, Inc.
315 Industrial Boulevard
Ellijay, Georgia 30540
Re: Registration Statement on Form S-8
Appalachian Bancshares, Inc. 1997 Directors' Non-Qualified Stock
Option Plan and 1997 Employee Stock Incentive Plan
Appalachian Bancshares, Inc. Section 401(k) Profit Sharing Plan
Ladies and Gentlemen:
We have served as counsel for Appalachian Bancshares, Inc., a Georgia
corporation (the "Company"), in connection with the registration under the
Securities Act of 1933, as amended, pursuant to a Registration Statement on
Form S-8 (the "Registration Statement"), under which up to 300,000 shares (the
"Shares") of Common Stock, $5.00 par value, of the Company are to be registered
for issuance under the Company's 1997 Directors' Non-Qualified Stock Option
Plan and 1997 Employee Stock Incentive Plan and the Appalachian Bancshares,
Inc. Section 401(k) Profit Sharing Plan (collectively, the "Plans").
We have examined such documents and certificates of public officials as
we have deemed necessary or appropriate for the purpose of issuing this opinion.
In such examinations, we have assumed the genuineness of all signatures on all
originals and copies of documents we have examined, the authenticity of all
documents submitted to us as originals and the conformity to original documents
of all certified, conformed or photostatic copies. As to questions of fact
material and relevant to our opinion, we have relied upon certificates or
representations of Company officials and of appropriate governmental officials.
We express no opinion as to matters under or involving the laws of any
jurisdiction other than the corporate law of the State of Georgia.
Based upon and subject to the foregoing and having regard for such legal
considerations as we have deemed relevant, it is our opinion that:
<PAGE> 2
1. The Shares have been duly authorized; and
2. After the Registration Statement becomes effective and up to
300,000 Shares to be issued pursuant to the Plans shall have been
issued upon the terms set forth in the respective Plans and as
contemplated by the Registration Statement, such Shares will be
validly issued, fully-paid and nonassessable.
We hereby consent to the filing of this opinion as Exhibits 5 and 23.2 to
the Registration Statement and the reference to our name in the Registration
Statement.
Sincerely,
/s/ Troutman Sanders LLP
---------------------------------
TROUTMAN SANDERS LLP
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement on Form S-8 of our report dated
February 3, 1997 included or incorporated by reference in the Appalachian
Bancshares, Inc. Annual Report on Form 10-KSB for the year ended December 31,
1996 and to all references to our firm included in this registration statement.
/s/ Schauer, Taylor, Cox & Edwards, P.C.
------------------------------------------
Schauer, Taylor, Cox & Edwards, P.C.
Birmingham, Alabama
May 14, 1997
