<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JULY 27, 1999.
REGISTRATION No. 333-18691
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 2
TO
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
CHEMFIRST INC.
(Exact name of registrant as specified in its charter)
MISSISSIPPI 64-0679456
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
700 NORTH STREET
JACKSON, MISSISSIPPI 39202
(Address of Principal Executive Offices) (Zip Code)
CHEMFIRST INC. 401(k) SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
(Full title of the plan)
JAMES L. MCARTHUR
SECRETARY
CHEMFIRST INC.
700 NORTH STREET
JACKSON, MISSISSIPPI 39202
(601) 948-7550
(Name and address, including zip code, and telephone number, including
area code, of agent for service)
In addition, pursuant to Rule 416 under the Securities Act of 1933, as
amended, this Registration Statement also covers shares of Common Stock of
ChemFirst Inc. issuable to prevent dilution resulting from stock splits, stock
dividends or similar transactions.
<PAGE> 2
This Post-Effective Amendment No. 2 on Form S-8 amends and restates that
certain Registration Statement No. 333-18691 on Form S-8 filed December 24,
1996, as amended by that certain Post-Effective Amendment No. 1 filed on January
17, 1997 relating to the ChemFirst Inc. 401(k) Savings Plan, as amended and
merged, the ChemFirst Inc. 401(k) Savings and Employee Stock Ownership Plan and
Trust. Accordingly the contents of the Registration Statement are incorporated
in this Post-Effective Amendment No. 2 by reference.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
The information specified by Items 1 and 2 of Part I of Form S-8 is
omitted from this filing in accordance with provisions of Rule 428 under the
Securities Act of 1933 (the "Securities Act") and the introductory Note to Part
I of Form S-8.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The documents set forth below are incorporated by reference in this
Registration Statement. All documents subsequently filed by ChemFirst Inc.
("ChemFirst") and the ChemFirst Inc. 401(k) Savings and Employee Stock Ownership
Plan and Trust pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act of 1934 (the "Exchange Act"), prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated by reference in this Registration Statement and to be part
hereof commencing on the respective dates on which such documents are filed. Any
statement contained in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Registration Statement to the extent that a statement contained herein or
in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
(1) ChemFirst's Annual Report on Form 10-K for the year ended
December 31, 1998;
(2) The Annual Report on Form 11-K for the ChemFirst Inc. 401(k)
Savings and Employee Stock Ownership Plan and Trust for the plan
year ended December 31, 1998;
(3) ChemFirst's quarterly report on Form 10-Q for the quarterly
period ended March 31, 1999;
(4) All other reports filed with the Securities and Exchange
Commission pursuant to Section 13(a) or 15(d) of the Exchange
Act since the end of the fiscal year covered by the reports in
(1) and (2) above; and
(5) The description of the Common Stock which is contained in
ChemFirst's Registration Statement on Form 8-A dated December 9,
1996, filed pursuant to Section 12 of the Exchange Act, and all
amendments thereto and reports which have been filed for the
purpose of updating such description.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable.
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<PAGE> 3
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Subarticle E of Article 8 of the Mississippi Business Corporation Act
("MBCA") empowers a Mississippi corporation to indemnify against
liability an individual who is made a party to any threatened, pending
or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, formal or informal (a "Proceeding"),
because such person is or was a director of the corporation. To be
eligible for indemnification, the director must have conducted himself
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 action or proceeding, had no reasonable cause to
believe such person's conduct was unlawful. Liability indemnified
against includes the obligation to pay a judgment, settlement, penalty,
fine or reasonable expenses incurred with respect to a Proceeding. The
MBCA precludes a corporation from indemnifying a director 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 charging improper personal benefit to a director,
whether or not involving action in the director's official capacity, in
which the director was adjudged liable on the basis that personal
benefit was improperly received by the director.
Subarticle E further provides that if a director is wholly successful,
on the merits or otherwise, in the defense of any Proceeding to which he
was a party because he is or was a director, the corporation must
indemnify him against reasonable expenses incurred in connection with
the Proceeding. Also, a court may order a company to indemnify a
director if it determines the director is fairly and reasonably entitled
to indemnification in view of all of the relevant circumstances.
Subarticle E also allows corporations to indemnify officers, employees
or agents to the same extent as directors, and provides for mandatory or
court-ordered indemnification for these persons as described above.
Finally, the MBCA allows corporations to purchase and maintain insurance
on behalf of directors, officers, employees or agents against liability
asserted against or incurred by them in that capacity or arising from
their status as such, whether or not the corporation would have the
power to indemnify such person against liability under Subarticle E.
ChemFirst's Bylaws provide for indemnification of ChemFirst's officers
and directors to the fullest extent allowed by Mississippi law and
further permit such indemnification with respect to other employees and
agents. ChemFirst entered into indemnification agreements with certain
of its officers and its directors. The effect of these agreements is to
add a contractual right of indemnification to the indemnification rights
otherwise granted by law.
ChemFirst maintains directors' and officers' liability insurance which
protects each director and officer from certain claims and suits,
including shareholder derivative suits, even where the director may be
determined to not be entitled to indemnification under the MBCA and
claims and suits arising under the Securities Act. The policy may also
afford coverage under circumstances where the facts do not justify a
finding that the director or officer acted in good faith and in a manner
that was in or not opposed to the interests of ChemFirst.
The foregoing represents a summary of the general effect of the MBCA,
ChemFirst's Bylaws, indemnity agreements, and directors' and officers'
liability insurance coverage for purposes of general description only.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable.
ITEM 8. EXHIBITS.
In lieu of certain exhibit requirements, ChemFirst will submit or has
submitted 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 continue to qualify the Plan under
Section 401 of the Internal Revenue Code.
4.1* Amended and Restated Articles of Incorporation of ChemFirst are
incorporated by reference to Exhibit 3.1 of ChemFirst's S-1
Registration Statement (file number 333-15789).
II-2
<PAGE> 4
4.2* Bylaws of ChemFirst, as amended, are incorporated by reference
to Exhibit 4.3 of ChemFirst's S-8 Registration Statement (file
number 333-69965).
4.3* Rights Agreement dated as of October 30, 1996, by and between
ChemFirst and KeyCorp Shareholder Services, Inc. is incorporated
by reference to Exhibit 4 of ChemFirst's S-1 Registration
Statement (file number 333-15789).
4.4* First Amendment to Rights Agreement by and among ChemFirst,
KeyCorp Shareholder Services, Inc. and the Bank of New York is
incorporated by reference to Exhibit 4.5 to ChemFirst's S-8
Registration Statement (file number 333-69965).
4.5* ChemFirst's 401(k) Savings Plan is incorporated by reference to
Exhibit 4.4 of ChemFirst's S-8 Registration Statement (file
number 333-18691).
4.6 ChemFirst Inc. 401(k) Savings and Employee Stock Ownership Plan
and Trust (as amended and restated effective January 1, 1997;
supersedes ChemFirst's 401(k) Savings Plan, previously filed as
Exhibit 4.5).
4.7 First Amendment to ChemFirst Inc. 401(k) and Employee Stock
Ownership Plan and Trust.
4.8* Note Purchase Agreement between ChemFirst, State Farm Life
Insurance Company and Nationwide Life Insurance Company is
incorporated by reference to Exhibit 4(j) of ChemFirst's Annual
Report on Form 10-K for fiscal year ended December 31, 1998.
4.9* ChemFirst Inc. 1998 Long-Term Incentive Plan is incorporated by
reference to Appendix A to ChemFirst's Proxy Statement filed in
connection with its May 27, 1998 annual meeting of stockholders.
4.10 Second Amendment to ChemFirst Inc. 401(k) Savings and Employee
Stock ownership Plan and Trust.
5.3* Determination letter dated April 24, 1996 from the IRS regarding
ChemFirst's 401(k) Savings Plan is incorporated by reference to
Exhibit 5.3 of ChemFirst's Registration Statement (file number
333-18691).
23.1 Consent of KPMG Peat Marwick LLP.
24.1 Powers of Attorney is included on page II-5 herein.
* Previously filed.
ITEM 9. UNDERTAKINGS.
ChemFirst herein 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;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this 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 this
Registration Statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would
not exceed that which was registered) and any deviation
from the low or high end of the estimated maximum
offering range may be 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-3
<PAGE> 5
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in this
Registration Statement or any material change to such
information in the Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or
Form F-3, and 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 Securities and
Exchange Commission by ChemFirst pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by
reference in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, 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.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of ChemFirst's annual report
pursuant to Section 13(a) or Section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange
Act) that is incorporated by reference in the Registration
Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(5) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of ChemFirst pursuant to the foregoing
provisions, or otherwise, ChemFirst has been advised that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other
than the payment by ChemFirst of expenses incurred or paid by a
director, officer or controlling person of ChemFirst 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, ChemFirst 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 Securities Act and
will be governed by the final adjudication of such issue.
II-4
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Registrant
has duly caused this Post-Effective Amendment No. 2 to the Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi on July 27, 1999.
CHEMFIRST INC.
By: /s/ J. Kelley Williams
-----------------------------------
J. Kelley Williams
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
KNOW ALL MEN AND WOMEN BY THESE PRESENTS, that each person whose
signature appears below constitutes and appoints J. Kelley Williams and R.
Michael Summerford, and each of them, such individuals' true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for such individual and in his or her name, place and stead, in
any and all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement and any registration statement
related to the offering contemplated by this registration statement that is to
be effective upon filing pursuant to Rule 462(b) under the Securities Act of
1933, and to file the same, with all exhibits thereto, and all documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises as fully and to intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said
attorneys-in-fact and agents, or any of them, or their substitute or
substitutes, may lawfully do or cause to be done by virtue hereof.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ J. Kelley Williams Chairman of the Board of Directors, July 27, 1999
- ------------------------------------ Chief Executive Officer (Principal
J. Kelley Williams Executive Officer)
/s/ R. M. Summerford President and Chief Operating Officer July 27, 1999
- ------------------------------------
R. M. Summerford
/s/ Max P. Bowman Vice President, Finance and Treasurer
- ------------------------------------ (Principal Financial Officer) July 27, 1999
Max P. Bowman
/s/ Troy B. Browning Controller (Principal Accounting
- ------------------------------------ Officer) July 27, 1999
Troy B. Browning
/s/ Richard P. Anderson Director July 27, 1999
- ------------------------------------
Richard P. Anderson
/s/ Paul A. Becker Director July 27, 1999
- ------------------------------------
Paul A. Becker
</TABLE>
II-5
<PAGE> 7
<TABLE>
<S> <C> <C>
/s/ James W. Crook Director July 27, 1999
- ------------------------------------
James W. Crook
/s/ Michael J. Ferris Director July 27, 1999
- ------------------------------------
Michael J. Ferris
/s/ James E. Fligg Director July 27, 1999
- ------------------------------------
James E. Fligg
/s/ Robert P. Guyton Director July 27, 1999
- ------------------------------------
Robert P. Guyton
/s/ Paul W. Murrill Director July 27, 1999
- ------------------------------------
Paul W. Murrill
/s/ William A. Percy, II Director July 27, 1999
- ------------------------------------
William A. Percy, II
/s/ Dan F. Smith Director July 27, 1999
- ------------------------------------
Dan F. Smith
/s/ Leland R. Speed Director July 27, 1999
- ------------------------------------
Leland R. Speed
/s/ R. Gerald Turner Director July 27, 1999
- ------------------------------------
R. Gerald Turner
</TABLE>
II-6
<PAGE> 8
Pursuant to the requirements of the Securities Act of 1933, the Plan has
duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Jackson, State of
Mississippi, on the 27th day of July, 1999.
CHEMFIRST INC. 401(K) SAVINGS AND EMPLOYEE
STOCK OWNERSHIP PLAN AND TRUST
By: /s/ J. Steve Chustz
--------------------------------------
J. Steve Chustz
Employee Benefits Committee
By: /s/ William B. Kemp, Jr.
--------------------------------------
William B. Kemp, Jr.
Employee Benefits Committee
By: /s/ George M. Simmons
--------------------------------------
George M. Simmons
Employee Benefits Committee
By: /s/ R. M. Summerford
--------------------------------------
R. M. Summerford
Employee Benefits Committee
II-7
<PAGE> 9
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER EXHIBIT
------ -------
<S> <C>
4.1* Amended and Restated Articles of Incorporation of ChemFirst
are incorporated by reference to Exhibit 3.1 of ChemFirst's
S-1 Registration Statement (file number 333-15789).
4.2* Bylaws of ChemFirst, as amended, are incorporated by reference
to Exhibit 4.3 of ChemFirst's S-8 Registration Statement (file
number 333-69965).
4.3* Rights Agreement dated as of October 30, 1996, by and between
ChemFirst and KeyCorp Shareholder Services, Inc. is
incorporated by reference to Exhibit 4 of ChemFirst's S-1
Registration Statement (file number 333-15789).
4.4* First Amendment to Rights Agreement by and among ChemFirst,
KeyCorp Shareholder Services, Inc. and the Bank of New York is
incorporated by reference to Exhibit 4.5 to ChemFirst's S-8
Registration Statement (file number 333-69965).
4.5* ChemFirst's 401(k) Savings Plan is incorporated by reference
to Exhibit 4.4 of ChemFirst's S-8 Registration Statement (file
number 333-18691).
4.6 ChemFirst Inc. 401(k) Savings and Employee Stock Ownership
Plan and Trust (as amended and restated effective January 1,
1997; supersedes ChemFirst's 401(k) Savings Plan, previously
filed as Exhibit 4.5).
4.7 First Amendment to ChemFirst Inc. 401(k) and Employee Stock
Ownership Plan and Trust.
4.8* Note Purchase Agreement between ChemFirst, State Farm Life
Insurance Company and Nationwide Life Insurance Company is
incorporated by reference to Exhibit 4(j) of ChemFirst's
Annual Report on Form 10-K for fiscal year ended December 31,
1998.
4.9* ChemFirst Inc. 1998 Long-Term Incentive Plan is incorporated
by reference to Appendix A to ChemFirst's Proxy Statement
filed in connection with its May 27, 1998 annual meeting of
stockholders.
4.10 Second Amendment to ChemFirst Inc. 401(k) Savings and Employee
Stock Ownership Plan and Trust.
5.3* Determination letter dated April 24, 1996 from the IRS
regarding ChemFirst's 401(k) Savings Plan is incorporated by
reference to Exhibit 5.3 of ChemFirst's Registration Statement
(file number 333-18691).
23.1 Consent of KPMG Peat Marwick LLP.
24.1 Powers of Attorney is included on page II-5 herein.
</TABLE>
- ----------------
* Previously filed.
<PAGE> 1
PREAMBLE
A. The Employer has previously established a 401(k) Profit Sharing Plan
and Trust for the exclusive benefit of its eligible Employees and their
Beneficiaries;
B. The Employer has previously established an Employee Stock Ownership
Plan for the exclusive benefit of its eligible Employees and their
Beneficiaries;
C. Effective JANUARY 1, 1997, the Employer desires to amend, combine,
merge and consolidate the Employee Stock Ownership Plan with the 401(k) Profit
Sharing Plan and Trust so that together they will become and be a single 401(k)
Savings and Employee Stock Ownership Plan and Trust (hereinafter sometimes
called the "Merged Plan and Trust");
D. The Employer in recognition of the lasting contribution made by its
Employees to its successful operation wants to continue the Merged Plan and
Trust by amending and restating the Merged Plan and Trust to qualify under
Sections 401(a) and 501(a) of the Internal Revenue Code of 1986 as amended and
the regulations promulgated thereunder;
E. The Trustees are willing to act as Trustee under the terms of the
Plan and Trust contained in this Agreement;
F. The Trustee will hold, administer and distribute the transferred
assets as a part of the Merged Plan and Trust, and the Trustee must maintain a
separate Employer Contribution account for the benefit of the Employee on whose
behalf the Trustee accepted the transfer in order to reflect the value of the
transferred assets;
G. The Merged Plan and Trust will preserve all Code Section 411(d)(6)
protected benefits with respect to those transferred assets, in the manner
described in Section 10.05 of the Merged Plan and Trust;
H. The accounts of all active participants under the Employee Stock
Ownership Plan, and the trust funds allocable thereto, shall be transferred to
the Merged Plan and Trust; shall be reflected in such Participant's separate
accounts established pursuant to Section 10.05 of the Merged Plan and Trust; and
shall be used to fund benefits under the Merged Plan and Trust as therein
provided.
NOW, THEREFORE, considering the premises and their mutual covenants,
the Employer and the Trustees agree as follows:
1
<PAGE> 2
ARTICLE 1
DEFINITIONS
As used in this document, unless otherwise defined or required by the context,
the following terms have the meanings set forth in this Article 1. Some of the
terms used in this document are not defined in Article 1, but for convenience
are defined as they are introduced in the text.
1.01 Accounts
Accounts means the separate accounts maintained for each Participant
reflecting applicable contributions, applicable forfeitures, investment
income (loss) allocated to the accounts and distributions.
1.02 Accounting Date, Valuation Date
The term Accounting Date means the last day of each Accounting Period
and any other days within the Accounting Period upon which, consistent
with established methods and guidelines, the Plan Administrator applies
the valuation procedures specified in Section 4.02. The term Valuation
Date, unless otherwise specified, means any business day on which the
New York Stock Exchange is open. The Accounting Date is a Valuation
Date.
1.03 Accounting Period
Accounting Period means each of the 3-month periods which end on March
31, June 30, September 30 and December 31.
1.04 Accrued Benefit
A Participant's Accrued Benefit means the total value, as of a given
date, of his Accounts determined as of the Valuation Date immediately
preceding the date of determination. A Participant's Accrued Benefit
will not be reduced solely on account of any increase in the
Participant's age or service or on account of an amendment to the Plan.
A Participant's Vested Accrued Benefit is equal to his Vested
Percentage of that portion of his Accrued Benefit which is subject to
the Vesting Schedule plus 100% of the remaining portion of his Accrued
Benefit.
1.05 Acquisition Loan
A loan (or other extension of credit) used by the trustee to finance
the acquisition of Company Stock, which loan may constitute an
extension of credit to the Trust from a party-in-interest (as defined
in ERISA).
1.06 Anniversary Date
Anniversary Date means the last day of each Plan Year. The Anniversary
Date is an Accounting Date and an Allocation Date.
1.07 Beneficiary
Beneficiary means the person, persons, trust or other entity who is
designated to receive any amount payable upon the death of a
Participant.
1.08 Cash-Out Distribution
Cash-Out Distribution means, as described in Article 5, a distribution
to a Participant upon termination of employment of his Vested Accrued
Benefit.
2
<PAGE> 3
1.09 Code and ERISA
Code means the Internal Revenue Code of 1986, as it may be amended from
time to time, and all regulations issued thereunder. Reference to a
section of the Code includes that section and any comparable section or
sections of any future legislation that amends, supplements or
supersedes such section and any regulations issued thereunder.
ERISA means Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as it may be amended from time to time, and all
regulations issued thereunder. Reference to a section of ERISA includes
that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section and any
regulations issued thereunder.
1.10 Company Stock
(a) Company Stock shall mean:
(i) Common stock issued by the Employer (or by a
corporation which is a member of the same controlled
group) which is readily tradeable on an established
securities market; or
(ii) If there is no common stock which meets the
requirements of (i) above, then common stock issued
by the Employer (or by a corporation which is a
member of the same controlled group) having a
combination of voting power and dividend rights equal
to or in excess of:
(A) that class of common stock of the Employer
(or any other such corporation) having the
greatest voting power; and
(B) that class of common stock of the Employer
(or of any other such corporation) having
the greatest dividend rights; or
(iii) Noncallable preferred stock, if such stock is
convertible at any time into stock which meets the
requirements of (i) or (ii) above (whichever is
applicable) and if such conversion is at a conversion
price that is reasonable. A preferred stock will be
considered noncallable if after the call there will
be a reasonable opportunity for a conversion which
meets the requirements of the preceding sentence in
accordance with applicable Treasury regulations.
1.11 Compensation
Except where otherwise specifically provided in this Plan, Compensation
means a Participant's earned income, wages, salaries, and fees for
professional services, and other amounts received for personal services
actually rendered in the course of employment with the employer
maintaining the plan (including, but not limited to, commissions paid
to salesmen, compensation for services on the basis of a percentage of
profits, commissions on insurance premiums and tips), and excluding the
following:
(i) Employer contributions to a plan of deferred compensation
which are not included in the employee's gross income for the
taxable year in which contributed or employer contributions
under a simplified employee pension plan to the extent the
contributions are deductible by the employee, or any
distributions from a plan of deferred compensation;
(ii) Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
3
<PAGE> 4
(iii) Amounts realized from the sale, exchange or other disposition
of stock acquired under a qualified stock option;
(iv) Other amounts which received special tax benefits, or
contributions made by the employer (whether or not under a
salary reduction agreement) toward the purchase of an annuity
described in Code Section 403(b) (whether or not the amounts
are actually excludable from the gross income of the
employee);
(v) Compensation received prior to a Participant's Entry Date.
Effective January 1, 1998, this exclusion no longer applies to
an Employee who is a member of an Eligible Employee
Classification other than Temporary Employees;
(vi) Payments for overtime work in excess of the regularly
scheduled work period;
(vii) Expense or other allowances;
(viii) Bonuses; and
(ix) Shift differential pay.
Compensation also includes any amounts contributed by the Employer or
any Related Employer on behalf of any Employee pursuant to a payroll
withholding agreement which are not includable in the gross income of
the Employee due to Code Sections 125, 402(e)(3), 402(h) or 403(b) and,
effective JANUARY 1, 1998, Code Section 402(k).
Notwithstanding the foregoing, for all purposes under this Plan,
Compensation in excess of the Statutory Compensation Limit will be
disregarded.
The Statutory Compensation Limit means $160,000, as adjusted in
accordance with Code Section 401(a)(17)(B).
1.12 Effective Date
The original Effective Date of the Plan is July 1, 1974. The effective
date of this restatement of the Plan is JANUARY 1, 1997. The provisions
of this Merged Plan and Trust, as amended and restated, shall apply
solely to an Employee who terminates employment with the Employer on or
after the restated Effective Date of this Merged Plan and Trust. If an
Employee terminates employment with the Employer prior to the restated
Effective Date, that Employee shall be entitled to benefits under the
Merged Plan as the Plan existed on the Employee's termination date.
1.13 Eligible Employee Classification
An Eligible Employee Classification is a classification of Employees,
the members of which are eligible to participate in the Plan. All
employee classifications are eligible to participate in the Plan,
except: Any employee covered by a collective bargaining agreement
unless otherwise provided in any applicable collective bargaining
agreement and Leased Employees.
1.14 Eligible Participant
All Participants are Eligible Participants.
4
<PAGE> 5
1.15 Employee
(a) In General
An Employee is any person who is employed by the Employer or a
Participating Employer.
(b) Leased Employee
A Leased Employee means any person who, pursuant to an
agreement between the Employer or any Related Employer
("Recipient Employer") and any other person ("leasing
organization"), has performed services for the Recipient
Employer on a substantially full-time basis for a period of at
least one year and such services are performed under the
primary direction or control of the Recipient Employer.
Any Leased Employee will be treated as an Employee of the
Recipient Employer; however, contributions or benefits
provided by the leasing organization which are attributable to
the services performed for the Recipient Employer will be
treated as provided by the Recipient Employer. If all Leased
Employees constitute less than 20% of the Employer's
non-highly-compensated work force within the meaning of Code
Section 414(n)(1)(C)(ii), then the preceding sentence will not
apply to any Leased Employee if such Employee is covered by a
money purchase pension plan ("Safe Harbor Plan") which
provides: (1) a nonintegrated employer contribution rate of at
least 10% of compensation, (2) immediate participation, and
(3) full and immediate vesting.
Years of Eligibility Service for purposes of eligibility to
participate in the Plan and Years of Vesting Service for
purposes of determining a Participant's Vested Percentage
include service by an Employee as a Leased Employee.
(c) Temporary Employee
Temporary Employee is a classification established by the
Employer to designate Employees who are expected to work less
than a Year of Service as defined in Section 1.45(b)(2).
1.16 Employer/Plan Sponsor
The Employer and Plan Sponsor is CHEMFIRST INC., successor in interest
to First Mississippi Corporation. A Participating Employer is any
organization which has adopted this Plan and Trust in accordance with
Section 8.07.
The term Predecessor Employer means any prior employer to which the
Employer is the successor, including any Predecessor Employer for which
the Employer maintains the obligations of a Predecessor Plan
established by the Predecessor Employer. Service with a Predecessor
Employer will be included as Service with the Employer for purposes of
determining Eligibility under this Plan, unless it is determined that
the Company and/or business organization is not a Portability Group
Member.
Service with a Predecessor Employer for purposes of determining Years
of Vesting Service shall be determined as a part of the merger,
acquisition, and/or adoption agreement.
1.17 Employment Commencement Date
The date an Employee first performs an Hour of Service for the Employer
is his Employment Commencement Date.
1.18 Entry Date
Entry Date means the first day of the month which coincides with or
next follows the date upon which the eligibility requirements of
Section 2.01 are met. Effective January 1, 1998, Entry Date means, with
respect to an Employee who is a member of an Eligible Employee
Classification other than Temporary Employees, the Employee's
Employment Commencement Date.
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1.19 Fiscal Year
Fiscal Year means the taxable year of the Plan Sponsor. The Fiscal Year
of the Plan Sponsor is the 12-month period beginning January 1 and
ending December 31.
1.20 Forfeiture
The term Forfeiture refers to that portion, if any, of a Participant's
Accrued Benefit which is in excess of his Vested Accrued Benefit
following the termination of the Participant's employment.
A Forfeiture is considered to occur as of the earlier of (a) the date
of the occurrence of the fifth of 5 consecutive One Year
Breaks-in-Service or (b) the date a Cash-Out Distribution occurs in
accordance with the provisions of Article 5.
1.21 Highly Compensated Definitions
(a) Compensation
For purposes of this Section, Compensation means Compensation
defined in Section 1.11, excluding only the exclusions
described in paragraphs (i) through (iv), and including
deferrals under (a) Code Section 402(e)(3) relating to a Code
Section 401(k) arrangement; (b) Code Section 125 relating to a
cafeteria plan; (c) Code Section 403(b) relating to a tax
sheltered annuity plan; (d) Code Section 408(h) relating to a
simplified employee pension; and (e) Effective JANUARY 1,
1998, Code Section 402(k) relating to a simple retirement
account. Compensation in excess of the Statutory Compensation
Limit will be disregarded.
(b) Determination Year
Determination Year means the Plan Year for which the
determination of who is Highly Compensated is being made.
(c) Highly Compensated Employee
Highly Compensated Employee means any individual who is a
Highly Compensated Active Employee or a Highly Compensated
Former Employee within the meaning of Code Section 414(q) and
the regulations thereunder.
(d) Highly Compensated Active Employee
Highly Compensated Active Employee means any individual who:
(1) During the Determination Year or the Lookback Year
was at any time a 5-percent Owner (within the meaning
of Code Section 416(i)) of the Employer or any
Related Employer;
(2) During the Lookback Year (i) received Compensation
from the Employer and all Related Employers in excess
of $80,000 (or any greater amount determined by
regulations issued by the Secretary of the Treasury
under Code Section 415(d)), and (ii), subject to the
election of the Plan Sponsor, was in the Top-paid
Group for the Lookback Year.
(e) Highly Compensated Former Employee
Highly Compensated Former Employee means any Former Employee
who had a Separation Year
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(within the meaning of Treasury Regulation Section 1.414(q)-1T
Q&A-5) and was a Highly Compensated Active Employee for either
the Separation Year or any Determination Year ending on or
after the Employee's 55th birthday.
(f) Highly Compensated Group
Highly Compensated Group means all Highly Compensated
Employees.
(g) Lookback Year
Lookback Year means the 12-month period immediately preceding
the Determination Year.
(h) Non-Highly Compensated Employee
Non-Highly Compensated Employee means an Employee who is not a
Highly Compensated Employee.
(i) Non-Highly Compensated Group
Non-Highly Compensated Group means all Non-Highly Compensated
Employees.
(j) Top-Paid Group
Top-Paid Group means those individuals who are among the top
20 percent of Employees of the Employer and all Related
Employers when ranked on the basis of Compensation received
during the year. In determining the number of individuals in
the Top-Paid Group (but not the identity of those
individuals), the following individuals may be excluded:
(1) Employees who have not completed 6 months of Service
by the end of the year. For this purpose, an Employee
who has completed One Hour of Service in any calendar
month will be credited with one month of Service;
(2) Employees who normally work fewer than 17 1/2 hours
per week;
(3) Employees who normally work fewer than 6 months
during any year. For this purpose, an Employee who
has worked on one day of a month is treated as having
worked for the whole month;
(4) Employees who have not reached age 21 by the end of
the year;
(5) Nonresident aliens who received no earned income
(which constitutes income from sources within the
United States) within the year from the Employer or
any Related Employer; and
(6) Employees covered by a collective bargaining
agreement negotiated in good faith between the
employee representatives and the Employer or a group
of employers of which the Employer is a member if (i)
90% or more of all employees of the Employer and all
Related Employers are covered by collective
bargaining agreements, and (ii) this Plan covers only
Employees who are not covered under a collective
bargaining agreement.
1.22 Hour of Service
An Hour of Service means:
(a) Each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for the Employer. These
hours will be credited to the Employee for the computation
period in which the duties are performed;
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(b) Each hour for which an Employee is paid, or entitled to
payment, by the Employer 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. No more than 501
Hours of Service will be credited under this paragraph for any
12-month period. Hours under this paragraph will be calculated
and credited pursuant to Section 2530.200b-2 of the Department
of Labor Regulations which are incorporated herein by this
reference; and
(c) Each hour for which back pay, irrespective of mitigation of
damages, is either awarded or agreed to by the Employer. The
same Hours of Service will not be credited both under
paragraphs (a) or (b), as the case may be, and under this
paragraph (c). These hours will be credited to the Employee
for the computation period or periods to which the award or
agreement pertains rather than the computation period in which
the award, agreement or payment is made.
Hours of Service for all Employees will be determined on the basis of
actual hours for which an Employee is paid or is entitled to payment.
Hours of Service will be credited for employment with any Related
Employer or any Predecessor Employer. Hours of Service will be credited
for any individual considered an employee under Code Section 414(n) or
414(o) and the regulations thereunder.
Solely for purposes of determining whether a One Year Break-in-Service
has occurred, a Participant who is absent from work on an authorized
Leave of Absence or by reason of the Participant's pregnancy, birth of
the Participant's child, placement of a child with the Participant in
connection with the adoption of such child, or for the purpose of
caring for such child for a period immediately following such birth or
placement, will receive credit for the Hours of Service which otherwise
would have been credited to the Participant but for such absence. The
Hours of Service credited under this paragraph will be credited in the
Plan Year in which the absence begins if such crediting is necessary to
prevent a One Year Break-in-Service in such Plan Year; otherwise, such
Hours of Service will be credited in the following Plan Year. The Hours
of Service credited under this paragraph are those which would normally
have been credited but for such absence; in any case in which the Plan
Administrator is unable to determine such hours normally credited, 8
Hours of Service per day will be credited. No more than 501 Hours of
Service will be credited under this paragraph for any 12-month period.
The Date of Severance is the second anniversary of the date on which
the absence begins. The period between the initial date of absence and
the first anniversary of the initial date of absence is deemed to be a
period of Service. The period between the first and second
anniversaries of the initial date of absence is neither a period of
service nor a period of severance.
Notwithstanding the foregoing, effective December 12, 1994, an
authorized leave of absence granted on account of qualified military
service shall comply with the requirements of Code Section 414(u) in
determining a One Year Break-in-Service.
1.23 Investment Fund
An Investment Fund means any portion of the assets of the Trust Fund
which the Plan Administrator designates as an Investment Fund and for
which the Plan Administrator maintains a set of accounts separate from
the remaining assets of the Trust Fund.
(a) Specific Investment Fund means an Investment Fund which is
designated as a Specific Investment Fund by the Plan
Administrator in a manner and form acceptable to the Trustee.
(b) General Investment Fund means all assets of the Trust Fund
excluding the assets of any Specific Investment Funds.
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1.24 Leave of Absence
An authorized Leave of Absence means a period of time of one year or
less granted to an Employee by the Employer due to illness, injury,
temporary reduction in work force, or other appropriate cause or due to
military service during which the Employee's reemployment rights are
protected by law, provided the Employee returns to the service of the
Employer on or before the expiration of such leave, or in the case of
military service, within the time his reemployment rights are so
protected or within 60 days of his discharge from military service if
no federal law is applicable. All authorized Leaves of Absence are
granted or denied by the Employer in a uniform and nondiscriminatory
manner, treating Employees in similar circumstances in a like manner.
If the Participant does not return to active service with the Employer
on or prior to the expiration of his authorized Leave of Absence he
will be considered to have had a Date of Severance as of the earlier of
the date on which his authorized Leave of Absence expired, the first
anniversary of the last date he worked at least one hour as an Active
Participant, or the date on which he resigned or was discharged.
1.25 Normal Retirement Age
A Participant's Normal Retirement Age is age 65.
1.26 Normal Retirement Date
A Participant's Normal Retirement Date is the date on which the
Participant attains Normal Retirement Age.
1.27 One Year Break-in-Service
One Year Break-in-Service means any 365-day period following a
Participant's Date of Termination in which an Employee does not
complete at least one (1) Hour of Service.
Notwithstanding the foregoing, with respect to Temporary Employees, a
One Year Break-in-Service for purposes of eligibility, means a
Computation Period described in Section 1.45(b)(2) relating to Year of
Service, during which an Employee has not completed more than five
hundred (500) Hours of Service with the Employer.
1.28 Participant
The term Participant means an Employee or former Employee who is
eligible to participate in this Plan and who is or who may become
eligible to receive a benefit of any type from this Plan or whose
Beneficiary may be eligible to receive any such benefit.
(a) Active Participant means a Participant who is currently an
Employee in an Eligible Employee Classification.
(b) Disabled Participant means a Participant who has terminated
his employment with the Employer due to his Disability and who
is receiving or is entitled to receive benefits from the Plan.
(c) Retired Participant means a Participant who has terminated his
employment with the Employer after meeting the requirements
for his Normal Retirement Date and who is receiving or is
entitled to receive benefits from the Plan.
(d) Vested Terminated Participant means a Participant who has
terminated his employment with the Employer and who has a
nonforfeitable right to all or a portion of his or her Accrued
Benefit and who has not received a distribution of the value
of his or her Vested Accrued Benefit.
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(e) Inactive Participant means a Participant who has (i)
interrupted his status as an Active Participant without
becoming a Disabled, Retired or Vested Terminated Participant
and (ii) has a non-forfeitable right to all or a portion of
his Accrued Benefit and has not received a complete
distribution of his benefit.
(f) Former Participant means a Participant who has terminated his
employment with the Employer and who currently has no
nonforfeitable right to any portion of his or her Accrued
Benefit.
1.29 Payroll Withholding Agreement
If a written Payroll Withholding Agreement is required pursuant to the
provisions of Article 3, then each Participant who elects to
participate in the Plan will file such Agreement on or before the first
day of the payroll period for which the Agreement is applicable (or at
some other time as specified by the Plan Administrator). Such Agreement
will be effective for each payroll period thereafter until modified or
amended.
The terms of such Agreement will provide that the Participant agrees to
have the Employer withhold, each payroll period, any whole percentage
of his Compensation (or such other amount as allowed by the Plan
Administrator under rules applied on a uniform and nondiscriminatory
basis), not to exceed the limitations of Article 7. In consideration of
such Agreement, the Employer periodically will make a contribution to
the Participant's proper Account(s) in an amount equal to the total
amount by which the Participant's Compensation from the Employer was
reduced during applicable payroll periods pursuant to the Payroll
Withholding Agreement.
Notwithstanding the above, Payroll Withholding Agreements will be
governed by the following general guidelines:
(a) A Payroll Withholding Agreement will apply to each payroll
period during which an effective agreement is on file with the
Employer. Upon termination of employment, such agreement will
become void.
(b) The Plan Administrator will establish and apply guidelines
concerning the frequency and timing of amendments or changes
to Payroll Withholding Agreements. Notwithstanding the
foregoing, a Participant may revoke his Payroll Withholding
Agreement at any time and discontinue all future withholding.
(c) The Plan Administrator may amend or revoke its Payroll
Withholding Agreement with any Participant at any time, if the
Employer determines that such revocation or amendment is
necessary to insure that a Participant's Annual Additions for
any Plan Year will not exceed the limitations of Article 7 or
to insure that the requirements of Sections 401(k) and 401(m)
of the Code have been satisfied with respect to the amount
which may be withheld and contributed on behalf of the Highly
Compensated Group.
(d) Except as provided above, a Payroll Withholding Agreement may
not be revoked or amended by the Participant or the Employer.
1.30 Plan, Plan and Trust, Trust
The terms Plan, Plan and Trust and Trust mean CHEMFIRST INC. 401(k)
SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST. The Plan
Identification Number is 002. The Plan is a merged plan consisting of
an employee stock ownership plan with a cash or deferred arrangement.
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The term Predecessor Plan means any qualified plan previously
established and maintained by the Employer and to which this Plan is
the successor.
1.31 Plan Administrator
The Plan Administrator is the Employee Benefit Committee.
1.32 Plan Year
The Plan Year is the 12 month period beginning January 1 and ending
December 31. The Limitation Year coincides with the Plan Year.
1.33 Portability Group Member
A Portability Group Member shall mean the Company and any business
organization with which the Company has agreed to recognize the
portability of either service or benefits, or both, with respect to
employees whose employment is transferred between such Portability
Group Members.
1.34 Qualified Annuity Definitions
(a) Annuity Starting Date
Annuity Starting Date means (i) the first day of the first
period for which an amount is payable as an annuity, or (ii)
in the case of a benefit not payable in the form of an
annuity, the first day on which all events have occurred which
entitled the Participant to such benefit.
(b) Qualified Election
(1) In General
Qualified Election means a written waiver of a
Qualified Joint and Survivor Annuity or a Qualified
Survivor Annuity. The waiver must be consented to by
the Participant's spouse with such written consent
witnessed by a representative of the Plan
Administrator or a notary public. The spouse's
consent must include the designation of a specific
Beneficiary and the form of payment which cannot be
changed without the consent of the spouse. Such
consent will not be required if the Participant
establishes to the satisfaction of the Plan
Administrator that such written consent may not be
obtained because there is no spouse, the spouse
cannot be located or other circumstances that may be
prescribed by Treasury Regulations. Any consent which
is required under this Section will be valid only
with respect to the spouse who signs the consent (or
in the event of a deemed Qualified Election, the
designated spouse). Additionally, any revocation of a
prior waiver may be made by a Participant without the
consent of the spouse at any time before the Annuity
Starting Date; however, any waiver of a Qualified
Joint and Survivor Annuity or a Qualified Survivor
Annuity which follows such revocation must be in
writing and must be consented to by the Participant's
spouse. The number of waivers or revocations of such
waivers will not be limited.
(2) Qualified Joint and Survivor Annuity Notices
Not more than 90 days nor less than 30 days before
the Participant's Annuity Starting Date, the Plan
Administrator will provide the Participant a written
explanation of:
o the terms and conditions of a Qualified
Joint and Survivor Annuity;
o the Participant's right to make and the
effect of a Qualified Election to waive the
Qualified Joint and Survivor Annuity form of
benefit;
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o a general description of the eligibility
conditions and other material features of
the optional forms of benefit and sufficient
additional information to explain the
relative values of the optional forms of
benefit available;
o the rights of the Participant's spouse; and
o the right to make, and the effect of, a
revocation of a previous Qualified Election
to waive the Qualified Joint and Survivor
Annuity.
(3) Qualified Survivor Annuity Notices
The election period to waive the Qualified Survivor
Annuity begins on the first day of the Plan Year in
which the Participant attains age 35 and ends on the
date of the Participant's death. If a Vested
Terminated Participant separates from service before
the beginning of the election period, the election
period begins on the date of separation from service.
The Plan Administrator will, within the applicable
notice period, provide each Participant a written
explanation of the Qualified Survivor Annuity
containing comparable information to that required
under the provisions of Section 1.32(b)(2). For
purposes of this paragraph, the term "applicable
notice period" means whichever of the following
periods ends last:
o the period beginning with the first day of
the Plan Year in which the Participant
attains age 32 and ending with the close of
the Plan Year preceding the Plan Year in
which the Participant attains age 35;
o the period beginning two years before and
ending 12 months after the individual
becomes a Participant;
o the period beginning two years before and
ending 12 months after the joint and
survivor rules become effective for the
Participant; or
o the period beginning one year before and
ending 12 months after the Participant
separates from service before attaining age
35.
A Participant who will not have attained age 35 as of
the end of any current Plan Year may make a special
Qualified Election to waive the Qualified Survivor
Annuity for the period beginning on the date of the
election and ending on the first day of the Plan Year
in which the Participant attains age 35. The Election
will not be valid unless the Participant receives a
written explanation of the Qualified Survivor Annuity
in terms comparable to the explanation required
above. Qualified Survivor Annuity coverage will
automatically resume as of the first day of the Plan
Year in which the Participant attains age 35. Any new
waiver on or after that date will be subject to the
full requirements of this Section 1.34(b).
(c) Qualified Joint and Survivor Annuity
A Qualified Joint and Survivor Annuity means an annuity which
is purchased from an Insurer and which is payable for the life
of the Participant with a survivor annuity for the life of his
Surviving Spouse in an amount which is 50% of the amount
payable during the joint lives of the Participant and his
spouse. The amount of the Qualified Joint and Survivor Annuity
will be the amount of benefit which can be purchased from an
Insurer with the Participant's Vested Accrued Benefit.
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(d) Qualified Life Annuity
A Qualified Life Annuity means an annuity which is purchased
from an Insurer and which is payable for the lifetime of the
Participant with payments terminating upon the death of the
Participant. The amount of the Qualified Life Annuity will be
the amount of benefit which can be purchased from an Insurer
with the Participant's Vested Accrued Benefit.
(e) Qualified Survivor Annuity
A Qualified Survivor Annuity which a Surviving Spouse will be
eligible to receive under the provisions of Section 6.02 means
a monthly benefit payable for the remaining lifetime of the
Surviving Spouse. The amount of the Qualified Survivor Annuity
benefit will be the amount of benefit which can be purchased
from an Insurer with the Participant's Vested Accrued Benefit.
If the Participant's Vested Accrued Benefit is $3,500 or less,
the Plan Administrator will direct the immediate distribution
of the Participant's Vested Accrued Benefit to the Surviving
Spouse. If the Participant's Vested Accrued Benefit at the
time of any distribution exceeds $3,500, the Vested Accrued
Benefit at any later time will be deemed to exceed $3,500. The
Surviving Spouse may elect to receive the Qualified Survivor
Annuity as a lump sum.
1.35 Related Employer
The terms Related Employer and Affiliated Employer are used
interchangeably and mean any other corporation, association, company or
entity on or after the Effective Date which is, along with the
Employer, a member of a controlled group of corporations (as defined in
Code Section 414(b)), a group of trades or businesses which are under
common control (as defined in Code Section 414(c)), an affiliated
service group (as defined in Code Section 414(m)), or any organization
or arrangement required to be aggregated with the Employer by Treasury
Regulations issued under Code Section 414(o).
1.36 Required Beginning Date
The Required Beginning Date for the commencement of benefit payments
from the Plan is the April 1 immediately following the calendar year in
which the Participant attains age 70 1/2 for a Participant who is a
Five Percent Owner (as defined in Section 1.39(d)) with respect to the
Plan Year in which the Participant attains age 70 1/2.
The Required Beginning Date for the commencement of benefit payments
from the Plan for any other Participant is the April 1 immediately
following the later of (i) the calendar year in which the Participant
attains age 70 1/2, or (ii) if so elected by the Participant, the
calendar year in which the Participant retires.
1.37 Service
(a) Service means any period of time the Employee is in the employ
of the Employer. Service in all cases includes periods during
which the Employee is on an "authorized leave of absence" or a
"maternity or paternity leave of absence" described in Section
1.22 relating to One Year Break-in-Service. Leaves of absence
also shall include periods of absence in connection with
military service during which the Employee's re-employment
rights are legally protected. Except for absence by reason of
military service, leaves of absence shall be for a maximum
period of two (2) years. Leaves of absence shall be granted on
a uniform and nondiscriminatory basis.
(b) If the Employer maintains the plan of a Predecessor Employer,
Service shall include service for the Predecessor Employer. To
the extent it may be required under applicable Treasury
regulations under Code Section 414, Service shall include all
service for any Predecessor Employer.
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1.38 Surviving Spouse
Surviving Spouse means a deceased Participant's spouse who was married
to the Participant on the Participant's date of death. The Plan
Administrator and the Trustee may rely conclusively on a Participant's
written statement of his marital status. Neither the Plan Administrator
nor the Trustee is required at any time to inquire into the validity of
any marriage, the effectiveness of a common-law relationship or the
claim of any alleged spouse which is inconsistent with the
Participant's report of his marital status and the identity of his
spouse.
1.39 Top-Heavy Definitions
(a) Aggregate Account
Aggregate Account means, with respect to each Participant, the
value of all accounts maintained on behalf of the Participant,
whether attributable to Employer or Employee contributions,
used to determine Top-Heavy Plan status under the provisions
of a defined contribution plan. A Participant's Aggregate
Account as of the Determination Date will be the sum of:
o the balance of his Account(s) as of the most recent
valuation date occurring within a 12-month period
ending on the Determination Date (excluding any
amounts attributable to deductible voluntary employee
contributions); plus
o contributions that would be allocated as of a date
not later than the Determination Date, even though
those amounts are not yet made or required to be
made; plus
o any Plan Distributions made within the Plan Year that
includes the Determination Date or within the four
preceding Plan Years.
(b) Aggregation Group
Aggregation Group means either a Required Aggregation Group or
a Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group
Each plan of the Employer in which a Key Employee is
a Participant, and each other plan of the Employer
which enables any plan in which a Key Employee
participates to meet the requirements of Code Section
401(a)(4) or 410, will be aggregated and the
resulting group will be known as a Required
Aggregation Group.
Each plan in the Required Aggregation Group will be
considered a Top-Heavy Plan if the Required
Aggregation Group is a Top-Heavy Group. No plan in
the Required Aggregation Group will be considered a
Top-Heavy Plan if the Required Aggregation Group is
not a Top-Heavy Group.
(2) Permissive Aggregation Group
The Employer may also include any other plan not
required to be included in the Required Aggregation
Group, provided the resulting group (to be known as a
Permissive Aggregation Group), taken as a whole,
would continue to satisfy the provisions of Code
Sections 401(a)(4) and 410.
Only a plan that is part of the Required Aggregation
Group will be considered a Top-Heavy Plan if the
Permissive Aggregation Group is a Top-Heavy Group. No
plan in the
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Permissive Aggregation Group will be considered a
Top-Heavy Plan if the Permissive Aggregation Group is
not a Top-Heavy Group.
Only those plans of the Employer in which the
Determination Dates fall within the same calendar
year will be aggregated in order to determine whether
the plans are Top-Heavy Plans.
(c) Determination Date
Determination Date means the last day of the preceding Plan
Year, or, in the case of the first Plan Year, the last day of
the first Plan Year.
(d) Key Employee
Key Employee means any Employee or former Employee (and his
Beneficiary) who, at any time during the Plan Year or any of
the preceding four Plan Years, was:
(1) A "Five Percent Owner" of the Employer. "Five Percent
Owner" means any person who owns (or is considered as
owning within the meaning of Code Section 318) more
than 5% of the value of the outstanding stock of the
Employer or stock possessing more than 5% of the
total combined voting power of all stock of the
Employer. If the Employer is not a corporation, Five
Percent Owner means any person who owns more than 5%
of the capital or profits interest in the Employer.
In determining percentage ownership hereunder,
Related Employers will be treated as separate
Employers; or
(2) A "One Percent Owner" of the Employer having
Compensation from the Employer of more than $150,000.
"One Percent Owner" means any person who owns (or is
considered as owning within the meaning of Code
Section 318) more than 1% of the value of the
outstanding stock of the Employer or stock possessing
more than 1% of the total combined voting power of
all stock of the Employer. If the Employer is not a
corporation, One Percent Owner means any person who
owns more than 1% of the capital or profits interest
in the Employer. In determining percentage ownership
hereunder, Related Employers will be treated as
separate Employers. However, in determining whether
an individual has Compensation of more than $150,000,
Compensation from each Related Employer will be taken
into account.
(3) One of the 10 Employees having Compensation not less
than the Defined Contribution Dollar Limit (as
defined in Section 7.03(j) for the Plan Year) who
owns (or is considered as owning within the meaning
of Code Section 318) both greater than 112% interest
and the largest interests in all Employers required
to be aggregated under Code Sections 414(b), (c), (m)
and (o); or
(4) An officer (within the meaning of the regulations
under Code Section 416) of the Employer having
Compensation greater than 50% of the Defined Benefit
Dollar Limit as defined in Section 7.03(f) for the
Plan Year.
For purposes of this Section, Compensation means Compensation
as defined in Section 1.11, actually paid or includable in
gross income of the Participant, excluding only the exclusions
described in paragraphs (i) through (iv), including amounts
contributed by the Employer or any Related Employer on behalf
of any Employee pursuant to a Payroll Withholding Agreement
which are not includable in the gross income of the Employee
due to Code Section 125, 402(e)(3), 402(h), 403(b) or,
effective JANUARY 1, 1998, 402(k). Compensation in excess of
the Statutory Compensation Limit is disregarded.
15
<PAGE> 16
(e) Non-Key Employee
Non-Key Employee means any Employee (and his Beneficiaries)
who is not a Key Employee.
(f) Plan Distributions
Plan distributions include distributions made before January
1, 1984, and distributions under a terminated plan which, if
it had not been terminated, would have been required to be
included in an aggregation group. However, distributions made
after the valuation date and before the Determination Date are
not included to the extent that they are already included in
the Participant's Single Sum Benefit as of the valuation date.
With respect to "unrelated rollovers and plan-to-plan
transfers (those which are both initiated by an employee and
made from a plan maintained by one employer to a plan
maintained by another employer), if such a rollover or
plan-to-plan transfer is made from this Plan, it will be
considered as a distribution for purposes of this Section. If
such a rollover or plan-to-plan transfer is made to this Plan,
it will not be considered as part of the Participant's Single
Sum Benefit. However, an unrelated rollover or plan-to-plan
transfer accepted before January 1, 1984, will be considered
as part of the Participant's Single Sum Benefit.
With respect to "related" rollovers and plan-to-plan transfers
(those which are either not initiated by an employee or are
made from one plan to another plan maintained by the same
employer), if such a rollover or plan-to-plan transfer is made
from this Plan, it will not be considered as a distribution
for purposes of this Section. If such a rollover or
plan-to-plan transfer is made to this Plan, it will be
considered as part of the Participant's Single Sum Benefit.
(g) Present Value of Accrued Benefit
In the case of the defined benefit plan, a Participant's
Present Value of Accrued Benefit, for Top-Heavy determination
purposes, will be determined using the following rules:
(1) The Present Value of Accrued Benefit will be
determined as of the most recent "valuation date"
within a 12-month period ending on the Determination
Date.
(2) For the first Plan Year, the Present Value of Accrued
Benefit will be determined as if (A) the Participant
terminated service as of the Determination Date; or
(B) the Participant terminated service as of the
valuation date, but taking into account the estimated
Present Value of Accrued Benefits as of the
Determination Date.
(3) For any other Plan Year, the Present Value of Accrued
Benefit will be determined as if the Participant
terminated service as of the valuation date.
(4) The valuation date must be the same date used for
computing the defined benefit plan minimum funding
costs, regardless of whether a calculation is
performed that plan year.
(5) A Participant's Present Value of Accrued Benefit as
of a Determination Date will be the sum of:
o the present value of his Accrued Benefit
determined using the actuarial assumptions
which are specified below; plus
o any Plan Distributions made within the Plan
Year that includes the Determination Date or
within the four preceding Plan Years; plus
16
<PAGE> 17
o any employee contributions, whether
voluntary or mandatory. However, amounts
attributable to qualified voluntary employee
contributions, as defined in Code Section
219(e)(2) will not be considered to be a
part of the Participant's Present Value of
Accrued Benefit.
For purposes of this Section, the present value of a
Participant's Accrued Benefit will be equal to the
greater of the present value determined using the
actuarial assumptions which are specified for
Actuarial Equivalent purposes or the present value
determined using the "Applicable Interest Rate." The
Applicable Interest Rate is the rate or rates that
would be used by the Pension Benefit Guaranty
Corporation for a trusteed single-employer plan to
value a Participant's or Beneficiary's benefit on the
date of distribution (the "PBGC Rate"). If the
present value using the PBGC Rate exceeds $25,000,
the Applicable Interest Rate is 120% of the PBGC
Rate. However, the use of 120% of the PBGC Rate will
never result in a present value less than $25,000.
(6) Solely for the purpose of determining if this Plan
(or any other plan included in a Required Aggregation
Group of which this Plan is a part) is Top-Heavy, the
Accrued Benefit of any Employee other than a Key
Employee will be determined under
(A) the method, if any, that uniformly applies
for accrual purposes under all plans
maintained by the Employer or any Related
Employer, or
(B) if there is no such method, as if the
benefit accrued no more rapidly than the
slowest accrual rate permitted under the
fractional accrual rate of Code Section
411(b)(1)(C).
(h) Single Sum Benefit
The Single Sum Benefit for any Participant in a
defined benefit pension plan will be equal to his
Present Value of Accrued Benefit. The Single Sum
Benefit for any Participant in a defined contribution
plan will be equal to his Aggregate Account.
(i) Top-Heavy Group
Top-Heavy Group means an Aggregation Group in which,
as of the Determination Date, the Single Sum Benefits
of all Key Employees under all plans included in the
group exceeds 60% of a similar sum determined for all
Participants.
Super Top-Heavy Group means an Aggregation Group in
which, as of the Determination Date, the sum of (1)
the Single Sum Benefits of all Key Employees under
all defined benefit plans included in the group, plus
(2) the Single Sum Benefit of all Key Employees under
all defined contribution plans included in the group
exceeds 90% of a similar sum determined for all
Participants.
(j) Top-Heavy Plan
This Plan will be a Top-Heavy Plan for any Plan Year
beginning after December 31, 1983, in which, as of
the Determination Date, the Single Sum Benefits of
all Key Employees exceed 60% of the Single Sum
Benefits of all Participants under this Plan.
This Plan will be a Super Top-Heavy Plan for any Plan
Year beginning after December 31, 1983, in which, as
of the Determination Date, the Single Sum Benefits of
all Key Employees exceed 90% of the Single Sum
Benefits of all Participants under this Plan.
17
<PAGE> 18
If any Participant is a Non-Key Employee for a given
Plan Year, but was a Key Employee for any prior Plan
Year, the Participant's Single Sum Benefit will not
be taken into account for purposes of determining
whether this Plan is a Top-Heavy or Super Top-Heavy
Plan (or whether any Aggregation Group which includes
this Plan is a Top-Heavy or Super Top-Heavy Group).
If an individual has performed no services for the
Employer at any time during the 5-year period ending
on the Determination Date, any Single Sum Benefit of
such individual will not be taken into account for
purposes of determining whether this Plan is a
Top-Heavy or Super Top-Heavy Plan (or whether any
Aggregation Group which includes this Plan is a
Top-Heavy Group or Super Top-Heavy Group).
1.40 Trust Fund, Trust
These terms mean the total cash, securities, real property, insurance
contracts and any other property held by the Trustee.
1.41 Trustee
Trustee means The Charles Schwab Trust Company or any successor
Trustee.
1.42 Vested Percentage
A Participant's Vested Percentage as of a given date will be that
percentage determined in accordance with the Vesting Schedule.
Notwithstanding the preceding, a Participant will be 100% vested upon
reaching his Normal Retirement Age.
1.43 Vesting Schedule
A Participant shall be fully vested at all times in amounts credited to
the Participant's Employee Account, Pre-401(k) Account, Rollover
Account and certain Employee Stock Ownership Accounts into which PAYSOP
accounts were merged on August 1, 1996. In addition, the Participant
also shall be entitled to receive a Nonforfeitable percentage of the
balance credited to the Company Matching Account and Employee Stock
Ownership Account, determined under the following vesting schedule:
<TABLE>
<CAPTION>
Nonforfeitable
--------------
Years of Service Percentage
---------------- ----------
<S> <C>
Less than 3 years 0%
At least 3 years 100%
</TABLE>
Notwithstanding the foregoing, the following vesting schedule shall
apply to Participants' Employee Stock Ownership Accounts merged
hereunder as of JANUARY 1, 1997, but only with respect to Participants
who are credited with an Hour of Service on or after JANUARY 1, 1997:
<TABLE>
<CAPTION>
Nonforfeitable
--------------
Years of Service Percentage
---------------- ----------
<S> <C>
Less than 1 year 0%
At least 1 but less than 2 years 10%
At least 2 but less than 3 years 25%
At least 3 years 100%
</TABLE>
18
<PAGE> 19
1.44 Written Resolution
The terms Written Resolution and Written Consent are used
interchangeably and reflect decisions, authorizations, etc. by the
Employer. A Written Resolution will be evidenced by a resolution of the
Board of Directors of the Employer.
1.45 Year of Service
(a) Crediting Years of Service. Years of Service are determined
using the Elapsed Time Method and/or the Hours of Service
Method as specified in this Section.
(1) Elapsed Time Method. The Elapsed Time Method shall be
used to compute Years of Eligibility Service and
Years of Vesting Service for all Employees who are
members of an Eligible Employee Classification.
Under the Elapsed Time Method, Years of Service are
based upon an Employee's Elapsed Time of employment
irrespective of the number of hours actually worked
during such period; a Year of Service (including a
fraction thereof) will be credited for each completed
365 days of Elapsed Time which need not be
consecutive. The following terms are used in
determining Years of Service under the Elapsed Time
Method:
o Date of Severance (Termination) - means the
earlier of (A) the actual date an Employee
resigns, is discharged, dies or retires, or
(B) the first anniversary of the date an
Employee is absent from work (with or
without pay) for any other reason, e.g.,
disability, vacation, leave of absence,
layoff, etc.
o Elapsed Time - means the total period of
service which has elapsed between a
Participant's Employment Commencement Date
and Date of Termination including Periods of
Severance where a One Year Break-in-Service
does not occur.
o Employment Commencement Date - means the
date an Employee first performs one Hour of
Service for the Employer.
o One Year Break-in-Service - means any
365-day period following an Employee's Date
of Termination as defined above in which the
Employee does not have at least one Hour of
Service.
o Period of Severance - is the time between
the actual Date of Severance as defined
above and the subsequent date, if any, on
which the Employee performs an Hour of
Service.
All periods of employment will be aggregated
including Periods of Severance unless there is a One
Year Break-in-Service.
(2) Hours of Service Method. The Hours of Service Method
shall be used to determine Years of Eligibility
Service for Leased and Temporary Employees.
Under the Hours of Service Method, a Year of Service
is credited for each 12 consecutive month Computation
Period during which an Employee is credited with a
specified number of Hours of Service.
19
<PAGE> 20
Under the Hours of Service Method, a One Year
Break-in-Service means any Computation Period during
which an Employee completes 500 or fewer Hours of
Service.
Years of Eligibility Service for purposes of determining
eligibility to participate in the Plan and Years of Vesting
Service for purposes of determining a Participant's Vested
Percentage include service with any organization which is a
Related Employer with respect to the Employer.
(b) For Eligibility Purposes
(1) Eligible Employee Classifications Other than
Temporary Employees. Employees who are members of an
Eligible Employee Classification and who are not
Temporary Employees shall complete six months of
Service for purposes of eligibility in the Plan. The
Computation Period for purposes of determining
eligibility is the six (6) consecutive month period
commencing on an Employee's Employment Commencement
Date and ending on the 183rd day thereafter during
which the Employee is continuously employed by the
Employer. An Employee shall receive credit for the
aggregate of all time periods commencing with the
first day the Employee is entitled to credit for an
Hour of Service, including the Re-Employment
Commencement Date, and ending on the date a
Break-in-Service begins. Effective January 1, 1998,
an Employee who is a member of an Eligible Employee
Classification other than Temporary Employees shall
be eligible to participate in the Plan on the
Employee's Employment Commencement Date.
(2) Temporary Employees. Year of Service for purposes of
eligibility shall mean the twelve (12) consecutive
month Computation Period during which the Employee
completes one thousand (1,000) Hours of Service. The
initial Computation Period, for purposes of this
subsection, shall be the twelve (12) consecutive
month period commencing with the date on which an
Employee is first entitled to credit for an Hour of
Service with the Employer, the Employment
Commencement Date. The Computation Period for each
Employee shall shift to the Plan Year which includes
the Anniversary Date of an Employee's Employment
Commencement Date without regard to whether the
Employee is entitled to be credited with one thousand
(1,000) Hours of Service during the period, provided
that an Employee who is credited with one thousand
(1,000) Hours of Service in both the initial
Computation Period and the Plan Year which includes
the first Anniversary Date of the Employee's
Employment Commencement Date shall be credited with
two (2) Years of Service. In computing an Employee's
Year(s) of Service in the case of any Participant who
has a One Year Break-in-Service, Service before the
Break in Service shall not be required to be taken
into account under the Plan until the Employee has
completed a Year of Service measured from the date of
re-employment.
(c) For Vesting Purposes
Years of Service for purposes of computing a Participant's
Vested Percentage are referred to as Years of Vesting Service
and are determined using the Elapsed Time Method. For purposes
of determining an Employee's Years of Vesting Service, an
Employee shall receive credit for the aggregate of all time
periods commencing on an Employee's Employment Commencement
Date, including the Re-Employment Commencement Date, and
ending on the date a Break-in-Service begins. An Employee also
shall receive credit for any Period of Severance of less than
365 days.
20
<PAGE> 21
A Year of Vesting Service (including a fraction thereof) will
be credited for each completed 365 days of Elapsed Time which
need not be consecutive. In computing an Employee's Years of
Vesting Service, the following rules shall apply:
(i) Service shall be disregarded in computing a
Participant's Years of Vesting Service under the Plan
for Plan Years beginning prior to March 1, 1985, for
which the Employee was eligible to make basic
contributions (after-tax contributions) but declined
to make any such contributions to the Plan, if such
period occurred prior to his initial date of
participation in the Plan.
(ii) Service shall be disregarded in computing a
Participant's Years of Vesting Service for Plan Years
beginning on or after March 1, 1985, but before
October 1, 1993, for which the Employee was eligible
to direct the Employer to make Salary Deferral
Contributions on his behalf but declined to direct
the Employer to make any such contributions to the
Plan; and if such period occurred prior to his
initial date of participation in the Plan.
(iii) Service prior to July 1, 1974, shall be disregarded
in computing a Participant's Years of Vesting
Service.
(d) Related Employers
Years of Eligibility Service for purposes of determining
eligibility to participate in the Plan and Years of Vesting
Service for purposes of determining a Participant's Vested
Percentage include service with any organization which is a
Related Employer with respect to the Employer.
(e) Loss of Service
If a Participant who is zero percent (0%) vested terminates
employment and incurs at least 5 consecutive One Year
Breaks-in-Service, he or she will lose all prior Eligibility
Service and Vesting Service.
(f) Change in Computation Method
With respect to the Employee Stock Ownership Plan Accounts
merged hereunder, for purposes of determining a Participant's
Years of Vesting Service in those Accounts as of December 31,
1996, the method used to calculate Years of Vesting Service
shall be the method described in Section 2.14 of the First
Mississippi Corporation Employee Stock Ownership Plan prior to
August 1, 1996, or in this Section 1.45, whichever will result
in the higher vested percentage.
21
<PAGE> 22
ARTICLE 2
PARTICIPATION
2.01 Participation
An Employee who is a member of an Eligible Employee Classification
other than Temporary Employees will become eligible to participate in
the Plan on the Entry Date which coincides with or next follows
completion of six (6) months of Service with the Employer.
Notwithstanding the preceding sentence, an Employee who has completed
at least six (6) months of Service with the Employer on the Effective
Date of this Plan shall be eligible to participate in this Plan on the
Effective Date. Effective January 1, 1998, an Employee who is a member
of an Eligible Employee Classification other than Temporary Employees
will become eligible to participate in the Plan on the Participant's
Employment Commencement Date.
Temporary Employees will become eligible to participate in the Plan on
the Entry Date which coincides with or next follows completion of one
(1) Year of Service with the Employer. Notwithstanding the preceding
sentence, a Temporary Employee who has completed one (1) Year of
Service with the Employer on the Effective Date of this Plan shall be
eligible to participate in this Plan on the Effective Date.
Employees not eligible to participate in the Plan are:
o Collective Bargaining Employees. Each Employee who is a member
of a collective bargaining unit shall not be eligible to
participate in this Plan unless the collective bargaining
agreement provides otherwise. An Employee is a member of a
collective bargaining unit if the Employee is 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 one or more employers if there is
evidence that retirement benefits were the subject of good
faith bargaining between the Employee representatives and the
employer or employers. The term "Employee representatives"
does not include an organization of which more than one-half
(1/2) the members are owners, officers, or executives of the
Employer.
o Leased Employees.
Notwithstanding the foregoing, if an Employee who is classified as a
Leased or Temporary Employee completes a Year of Service as defined in
Section 1.45(b)(2), such Employee shall be eligible to participate in
the Plan as of the first day of the month following completion of a
Year of Service.
An Employee who is otherwise eligible to participate may irrevocably
elect not to participate in the Plan. Any election under this paragraph
must be in writing and according to guidelines established by the Plan
Administrator.
2.02 Participant Re-Entry
If the employment of a Participant is terminated and the Participant
subsequently is re-employed, the re-employed Employee shall become a
Participant on the Re-employment Commencement Date. If an Employee
becomes eligible but terminates employment prior to the first Entry
Date, and the Employee is later re-employed, the Employee shall become
a Participant on the Re-employment Commencement Date.
2.03 Participation After Re-employment
An Employee who has satisfied all of the eligibility requirements but
terminates employment prior to his Entry Date will participate in the
Plan immediately upon returning to the employ of the Employer.
22
<PAGE> 23
A Participant or Former Participant who has terminated employment will
participate as an Active Participant in the Plan immediately upon
returning to the employ of the Employer.
An Employee who terminates employment prior to satisfying the
eligibility requirements of Section 2.01 and is subsequently
re-employed shall become a Participant after meeting the eligibility
requirements of Section 2.01, but shall be credited for Service
retroactively to the Re-employment Commencement Date for purposes of
eligibility and vesting.
2.04 Change in Employment Classification
If a Participant is no longer a member of an eligible class of
Employees and becomes ineligible to participate but has not incurred a
Break-in-Service, such Employee will participate immediately upon
returning to an eligible class of Employees. If a Participant incurs a
Break-in-Service, eligibility will be determined under the
Break-in-Service rules of Section 1.27.
In the event an Employee who is not a member of an Eligible Employee
Classification becomes a member of such a classification, such Employee
will begin to participate immediately if he has satisfied the
eligibility requirements which are specified in Section 2.01.
2.05 Portability
In the event an individual is transferred to or from employment covered
by this Plan from or to employment covered by another plan. The
provisions of this Section 2.05 shall control in situations where the
provisions of this Section 2.05 are in conflict with any other Section
or Sections of the Plan.
In the event that an individual is transferred from employment covered
by a plan sponsored by a Portability Group Member to employment covered
by this Plan, employment of such individual which is counted for
eligibility, vesting, and/or benefit accrual under the other plan may
be counted as Service for the same purpose under this Plan if provided
for by the acquisition, merger, and/or adoption agreement. Provided,
however, that participation in this Plan shall not commence prior to
the date on which the transfer takes place.
In the event that an individual is transferred from employment covered
by this Plan to employment covered by a plan sponsored by a Portability
Group Member, employment of such individual which is counted for
vesting purposes under the other plan may be counted as Service for
vesting purposes under this Plan. The individual's Accounts in the Plan
shall be maintained on an inactive basis and will continue to share in
the allocation of investment earnings pursuant to Section 4.02 hereof.
Except as otherwise provided in this paragraph, such individual will
not share in the allocation of Company Matching Contributions or
Forfeitures under this Plan after the date of his transfer to
employment covered by a Portability Group Member. In the Plan Year in
which such transfer occurs, such individual shall be entitled to share
in the Company Matching Contributions or Forfeitures under the
Portability Group Member's plan.
23
<PAGE> 24
ARTICLE 3
PARTICIPANT ACCOUNTS
3.01 Employee Account
Employee Account means the Account of a Participant reflecting
applicable contributions, investment income or loss allocated thereto
and distributions. A Participant's Employee Account is 100% vested at
all times.
(a) Employee Contributions
(1) Amount of Contribution
Each Participant may elect to make an Employee
Contribution each Contribution Period not to exceed
15% of the Participant's Compensation. Such
contribution will be designated as a percentage of
Compensation and will be equal to an even multiple of
1% or such other amount as allowed by the Plan
Administrator. The Employer shall contribute to the
Trust Fund the amount of each Participant's Employee
Contribution which shall be treated as Employer
Elective Contributions and credited to that
Participant's Employee Account.
(2) Contribution Period
The Contribution Period is each month.
(3) Method of Contribution
All Employee Contributions will be made pursuant to a
Payroll Withholding Agreement in accordance with
Section 1.29.
(4) Limitations on Contributions
(i) Amount
A Participant may elect to defer
Compensation only in an amount which the
Participant otherwise could elect to receive
in cash and which is currently available to
the Participant. Compensation is not
currently available to the Participant if
the Participant is not eligible to receive
it at the time of the contribution election.
(ii) Nondiscrimination Requirements
All Employee Contributions are Elective
Contributions within the meaning of Section
4.05(a)(8) and must satisfy the
Nondiscrimination Requirements of Section
4.05(a)(5) and (7).
(iii) Excess Deferrals
The maximum amount of Employee Contribution
which can be made under the Plan on behalf
of any Participant during any calendar year
will be limited to that amount which would
not constitute an Excess Deferral as defined
in Section 4.05(a)(14). The Plan
Administrator will distribute any Excess
Deferral, together with the income allocable
to it, to the Participant no later than
April 15 of the calendar year immediately
following the year of the Excess Deferral.
If a Participant notifies the Plan
Administrator before March 1 of any calendar
year that Excess Deferrals have been made on
his Account for the previous calendar year
by reason of participation in a Cash or
Deferred
24
<PAGE> 25
Arrangement maintained by another employer
or employers, and if the Participant
requests that the Plan Administrator
distribute a specific amount to him on
account of Excess Deferrals and certifies
that the requested amount is an Excess
Deferral, the Plan Administrator will
designate the amount requested together with
the income allocable to it as a distribution
of Excess deferrals and distribute such
amount no later than April 15 of that
calendar year. The amount of Excess
Deferrals to be distributed will be reduced
by any Excess Contributions previously
distributed or recharacterized with respect
to the Plan Year beginning with or within
the calendar year. The amount of income
allocable to the Excess Deferral will be
determined as described in Section 4.05(f).
(4) Timing of Deposits
The Employer will deposit all Employee Contributions
on the earliest date on which such contributions can
reasonably be segregated from the Employer's general
assets. Employer Elective Contributions accumulated
through payroll deductions shall be paid to the
Trustee with reasonable promptness and not later than
fifteen (15) business days after the end of the month
in which payroll deductions were made.
(b) Withdrawals Before Separation From Service
(1) Restrictions on Distributions
No distribution may be made from the Participant's
Employee Account or any account comprised of Matching
Contributions or Nonelective Contributions which are
treated as Elective Contributions in accordance with
the provisions of Section 4.05(h) except under one of
the following circumstances:
o the Participant's retirement, death,
disability or termination of employment;
o the Participant's attaining of age 59 1/2;
o the avoidance or alleviation of a Financial
Hardship;
o the termination of this Plan without the
establishment of a successor plan within the
meaning of Treasury Regulation Section
1.401(k)-1(d)(3);
o the sale or other disposition by the
Employer of at least 85 percent of the
assets used by the Employer in a trade or
business to an unrelated corporation which
does not maintain the plan, but only if the
Participant continues employment with the
corporation acquiring the assets and only if
the Employer continues to maintain this
Plan; or
o the sale or other disposition by the
Employer of its interest in a subsidiary to
an unrelated entity which does not maintain
the plan, but only if the Participant
continues employment with the subsidiary and
only if the Employer continues to maintain
this Plan.
This paragraph does not apply to distributions of
Excess Deferrals, Excess Contributions, or excess
Annual Additions.
25
<PAGE> 26
(2) Financial Hardship Withdrawals
A Participant may file with the Plan Administrator a
written request to withdraw, in order to avoid or
alleviate a Financial Hardship, any amount not to
exceed that portion of his Employee Account which
represents the sum of
o his total Employee Contributions made after
1988, and
o his total Employee Contributions made before
1989 together with the income earned before
1989 which is allocable to those
Contributions.
The Plan Administrator will allow Financial Hardship
withdrawals only if they are necessary to satisfy a
Participant's immediate and heavy financial need.
(i) Immediate and Heavy Financial Need Defined
A withdrawal will be deemed to be made due
to an immediate and heavy financial need of
the Participant if it is made because of:
o Expenses for medical care described
in Code Section 213(d) previously
incurred by the Participant, his
spouse or any of his dependents (as
defined in Code Section 152) or
necessary for these persons to
obtain medical care described in
Code Section 213(d);
o Costs directly related to the
purchase (excluding mortgage
payments) of a principal residence
for the Participant;
o Payment of tuition or educational
fees for the next 12 months of
post-secondary education for the
Participant, his spouse, children or
dependents (as defined in Code
Section 152);
o Prevention of the eviction of the
Participant from his principal
residence or foreclosure on the
mortgage of the Participant's
principal residence.
(ii) Maximum Withdrawal Amount
No withdrawal may exceed the amount
necessary to satisfy the Participant's
immediate and heavy financial need. However,
the amount of an immediate and heavy
financial need may include any amounts
necessary to pay any federal, state or local
income taxes or penalties reasonably
anticipated to result from the distribution.
The Plan Administrator will allow the
withdrawal if it determines, after a full
review of the Participant's written request
and evidence presented by the Participant
showing immediate and heavy financial need
as well as the Participant's lack of other
reasonably available resources, that the
withdrawal is necessary to satisfy the need.
No withdrawal will be treated as necessary
to the extent it can be satisfied from other
resources which are reasonably available to
the Participant, including those of the
Participant's spouse and minor children. A
withdrawal will be treated as necessary to
the extent the Participant demonstrates to
the satisfaction of the Plan Administrator
that the need cannot be relieved by any of
the following:
26
<PAGE> 27
o Reimbursement or compensation by
insurance or otherwise;
o Reasonable liquidation of assets to
the extent the liquidation would
not itself cause an immediate and
heavy financial need;
o Cessation of Employee Contributions
or Employee After-tax Contributions
(as defined in Section 4.05(a)) or
both under any plan maintained by
any employer;
o Other distributions or nontaxable
(at the time of the loan) loans
from plans maintained by any
employer;
o Borrowing from commercial sources
on reasonable commercial terms.
Unless the Plan Administrator has evidence
to the contrary, it may rely upon the
Participant's written representation that
the need cannot be relieved by any of the
foregoing.
(iii) Safe Harbor
The Plan Administrator will not allow any
withdrawal until the Participant has
obtained all distributions, other than
hardship distributions, and all nontaxable
loans currently available to the Participant
under all plans maintained by the Employer.
Upon the withdrawal of any portion of a
Participant's Employee Account, the
Participant will become ineligible for any
Elective Contribution to this Plan or any
other plan maintained by the Employer, or to
make any contribution to this Plan or any
other plan maintained by the Employer until
the first day of the first payroll period
which begins not less than 12 months
following the date of withdrawal. For this
purpose the phrase "any other plan
maintained by the Employer" means all
qualified and nonqualified plans of deferred
compensation maintained by the Employer. The
phrase includes stock option, stock
purchase, or similar plans, or a cash or
deferred arrangement that is part of a
cafeteria plan within the meaning of Code
Section 125. It does not include the
mandatory employee contribution portion of a
defined benefit plan, nor does it include a
health or welfare benefit plan (including
one that is part of a cafeteria plan within
the meaning of Code Section 125).
Furthermore, the maximum amount of Employee
Contributions which can be made under the
Plan on behalf of any Participant during the
calendar year which follows the calendar
year in which the withdrawal was made will
be limited to the amount which would not be
treated as an Excess Deferral for that year
reduced by the amount of Employee
Contributions made on behalf of the
Participant in the calendar year of
withdrawal.
3.02 Pre 401(k) Account
Pre 401(k) Account means the Account of a Participant reflecting
applicable contributions, investment income or loss allocated thereto
and distributions. A Participant's Pre 401(k) Account is 100% vested at
all times.
(a) Pre 401(k) Contributions
The Pre 401(k) Account (previously referred to as the Employee
Nondeferred Account) is a frozen account, effective March 1,
1985, consisting of Employee After-tax contributions plus
accumulated earnings. The Plan will neither permit nor accept
Employee After-tax contributions.
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(b) Withdrawals Before Separation From Service
A Participant may withdraw all or any portion of his Pre
401(k) Account at any time and from time to time subject to
the limitations of this Section. Each withdrawal at the time
it is paid shall be charged to the Pre 401(k) Account of the
withdrawing Participant. Total withdrawals under this Section
may be limited to the lesser of the aggregate amount of
Employee After-tax contributions made by the Participant or
the market value of the Pre 401(k) Account of the Participant
on the date of withdrawal. Any amounts in a Pre 401(k) Account
in excess of the aggregate Employee After-tax contributions
made to the account shall remain fully vested and
Nonforfeitable and shall be distributed according to the
option selected under Section 5.05 when the Participant
separates from service. A distribution of Employee After-tax
contributions must comply with the survivor annuity
requirements described in Sections 1.32 and 5.05.
3.03 Company Matching Account
Company Matching Account means the Account of a Participant reflecting
applicable contributions, forfeitures, investment income or loss
allocated thereto and distributions. The Company Matching Account is
divided into sub-accounts: (1) the Company Stock Sub-Account and (2)
the Other Investments Sub-Account. The Company Stock Sub-Account holds
a Participant's total interest in the Trust Fund attributable to the
Participant's portion of the Company Matching Contribution made or
invested in Company Stock. The Other Investments Sub-Account holds a
Participant's total interest in the Trust Fund attributable to the
Participant's portion of the Company Matching Contribution made in cash
and invested in assets other than Company Stock. A Participant's
Company Matching Account is subject to the Vesting Schedule.
(a) Company Matching Contributions
For each Contribution Period, the Employer will make a Company
Matching Contribution to each Eligible Participant's Company
Matching Account in an amount which is determined in
accordance with this Section subject to the limitations of
Article 7.
(1) Eligible Participants
All Participants who are employed by the Employer
during the Contribution Period and who have elected
to make an Employee Contribution for the Contribution
Period are eligible to share in the allocation of the
Company Matching Contribution for the Contribution
Period.
(2) Contribution Period
The Contribution Period for Company Matching
Contributions is each month.
(3) Amount of Company Matching Contribution
The amount of the Company Matching Contribution to be
made to an Eligible Participant's Company Matching
Account is equal to 100% of that portion of the
Participant's Employee Contribution which is not in
excess of 4% of the Participant's annual
Compensation. The Company Matching Contribution on
behalf of each Participant shall be credited to each
Participant's Company Matching Account.
(4) Form of Company Matching Contribution
The Employer may make its contribution in cash or in
Company Stock as the Employer may determine from time
to time. The Employer shall specify in writing at the
time a cash contribution is made whether such
contribution shall be allocated to the Company Stock
Sub-Account or the Other Investments Sub-Account of
each Eligible Participant.
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The Employer may make its contribution in the form of
Company Stock at the fair market value determined at
the time of contribution, which shall be invested in
the Company Stock Sub-Account of each eligible
Participant in accordance with Section 3.03(a)(3).
(5) Limitations
All Company Matching Contributions are Matching
Contributions within the meaning of Section 4.05(a)
and must satisfy the Nondiscrimination Requirements
of Section 4.05. The Company Matching Contribution
for any Plan Year on behalf of a Participant shall
not exceed the Participant's Annual Additions
limitation described in Article 7, even if the
formula would otherwise require a larger
contribution.
(6) Allocation of Company Matching Contributions
The Company Matching Contribution shall be allocated
to the Company Matching Account of each eligible
Participant in the same ratio that each Participant's
Employee Contribution for the Contribution Period
bears to the total Employee Contributions of all
Participants for such Contribution Period.
(7) Application of Forfeitures
Forfeitures from a Participant's Company Matching
Account may be used to pay plan expenses and/or to
reduce Company Matching Contributions in the Plan
Year in which the Forfeitures are determined to
occur.
Notwithstanding the above, amounts forfeited from a
Participant's Company Matching Account prior to July
1, 1996, are added to the THRIFTERS FUND and
allocated along with Company Matching Contributions
on the last day of the Plan Year in which the
forfeitures are determined to occur.
Amounts forfeited prior to July 1, 1996, will be
allocated by the ratio which each Eligible
Participant's Compensation bears to the total
Compensation of all Eligible Participants.
Notwithstanding the foregoing, the portion of a
Participant's account attributable to assets other
than Company Stock acquired with the proceeds of an
Acquisition Loan shall be forfeited first.
(8) Timing of Deposit
The Employer shall pay to the Trustee the Company
Matching Contributions at any time and from time to
time; except that the total Company Matching
Contribution for any Plan Year shall be paid in full
not later than the time prescribed by Code Section
404(a)(6) to enable the Employer to obtain a
deduction on its federal income tax return for the
Employer's taxable year. The total Company Matching
Contribution for any Plan Year shall be deemed made
on the Anniversary Date of that Plan Year.
(b) Withdrawals Before Separation from Service
A Participant must take any withdrawals available to him under
Section 3.02(a) and/or Section 3.04(b) before being eligible
to make a Company Matching Account withdrawal.
A Participant will be permitted to make a Company Matching
Account withdrawal if at least one of the following conditions
applies:
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<PAGE> 30
(1) If the Employee has been a Participant for five or
more years and has a date of participation in the
Plan on or before January 1, 1995;
(2) If the Participant has attained age 59 1/2; or
(3) On account of a Participant's financial need or
hardship as that term is defined in Section
3.01(b)(2).
A Company Matching Account withdrawal will not result in a
suspension of Company Matching Contributions.
A Participant who is eligible to make a withdrawal from his
Company Matching Account may not make a withdrawal from his
Company Matching Account more frequently than once each Plan
Year.
3.04 Employee Stock Ownership Account
Employee Stock Ownership Account means the Account of a Participant
reflecting contributions by the Employer in the form of Company Stock,
forfeitures, investment income or loss allocated thereto and
distributions. The Employee Stock Ownership Account is divided into
sub-accounts: (1) the Company Stock Sub-Account and (2) the Other
Investments Sub-Account. The Company Stock Sub-Account holds a
Participant's total interest in the Trust Fund attributable to the
Participant's portion of the Employee Stock Ownership Contribution made
or invested in Company Stock. The Other Investments Sub-Account holds a
Participant's total interest in the Trust Fund attributable to the
Participant's portion of the Employee Stock Ownership Contribution made
in cash and invested in assets other than Company Stock. A
Participant's Employee Stock Ownership Account is subject to the
Vesting Schedule.
(a) Employee Stock Ownership Account Contributions
(1) Eligible Participant
A Participant is entitled to share in the allocation
of Employee Stock Ownership Contributions and
Forfeitures, if any, for the Plan Year only if he is
an Employee on the Anniversary Date of the Plan. A
Participant who separates from service prior to the
Anniversary Date of the Plan during the Plan Year for
which the contribution was made shall not share in an
allocation, unless separation from Service occurred
because of the Participant's death, disability or
retirement. No Participant, other than one who died,
became disabled or retired during the Plan Year,
shall be entitled to have any Employee Stock
Ownership Contributions allocated to his or her
Account, unless the Participant shall be employed by
the Employer on the Anniversary Date for the Plan
Year.
The Plan Administrator will suspend the accrual
requirements for Includable Employees who are
Participants, beginning first with the Includable
Employee(s) employed with the Employer on the last
day of the Plan Year, then the Includable Employee(s)
who have the latest Separation from Service during
the Plan Year, and continuing to suspend in
descending order the accrual requirements for each
Includable Employee who incurred an earlier
Separation from Service, from the latest to the
earliest Separation from Service date, until the Plan
satisfies both the minimum participation requirements
of Code Section 401(a)(26)(A) and the
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<PAGE> 31
minimum coverage requirements of Code Section
410(b)(1) for the Plan Year. If two or more
Includable Employees have a Separation from Service
on the same day, the Plan Administrator will suspend
the accrual requirements for all such Includable
Employees, irrespective of whether the Plan can
satisfy the minimum participation requirements of
Code Section 401(a)(26)(A) and the minimum coverage
requirements of Code Section 410(b)(1) by accruing
benefits for fewer than all such Includable
Employees. If the Plan suspends the accrual
requirements for an Includable Employee, that
Employee will share in the allocation of Employer
contributions and Participant Forfeitures, if any,
without regard to the number of Hours of Service he
has earned for the Plan Year and without regard to
whether he is employed by the Employer on the last
day of the Plan Year. If the Employer's Plan includes
Employer matching contributions subject to Code
Section 401(m), this suspension of accrual
requirements applies separately to the Code Section
401(m) portion of the Plan, and the Plan
Administrator will treat an Employee as benefiting
under that portion of the Plan if the Employee is an
Eligible Employee for purposes of the
nondiscrimination requirements of Code Section
401(m)(2)(A). "Includable" Employees are all
Employees other than: (a) those Employees excluded
from participating in the Plan for the entire Plan
Year by reason of the collective bargaining unit
exclusion or the nonresident alien exclusion or by
reason of the participation requirements of Section
2.01 and (b) any Employee who incurs a Separation
from Service during the Plan Year and fails to
complete at least 501 Hours of Service for the Plan
Year.
(2) Contribution Period
The Contribution Period shall be the Plan Year.
(3) Amount
For each Plan Year, the amount of the Employee Stock
Ownership Contribution to the Trust Fund will equal
the amount, if any, the Employer may from time to
time determine and authorize. Although the Employer
may contribute to this Plan whether or not it has net
profits, the Employer intends the merged Plan to be
an employee stock ownership plan with a cash or
deferred arrangement for all purposes of the Code.
The Employer shall not authorize contributions by the
Employer at such times or in such amounts that the
Plan in operation discriminates in favor of Highly
Compensated Employees. Notwithstanding the foregoing,
the Employee Stock Ownership Contribution for any
year shall be subject to the limitations of Article
7.
(4) Form of Employee Stock Ownership Account Contribution
The Employer may make its contribution in cash or in
Company Stock as the Employer may determine from time
to time. The Employer shall specify in writing at the
time a cash contribution is made whether such
contribution shall be allocated to the Company Stock
Sub-Account or the Other Investment Sub-Account of
each Eligible Participant. The Employer may make its
contribution in the form of Company Stock at the fair
market value determined at the time of contribution,
which shall be invested in the Company Stock
Sub-Account of each Eligible Participant in
accordance with Section 3.04(a)(6).
(5) Limitations
The Employee Stock Ownership Contribution for any
Plan Year on behalf of a Participant shall not exceed
the Participant's Annual Additions limitation
described in Article 7.
(6) Allocation of Employee Stock Ownership Account
Contribution
The Employee Stock Ownership Contribution shall be
allocated to the Employee Stock Ownership Account of
each eligible Participant in the same ratio that each
Participant's Compensation for the Plan Year bears to
the total Compensation of all such Participants for
the Plan Year.
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<PAGE> 32
(7) Application of Forfeitures
Forfeitures from a Participant's Employee Stock
Ownership Account will be used to reduce Employee
Stock Ownership Contributions in the Plan Year in
which the Forfeitures are determined to occur.
Notwithstanding the foregoing, the portion of a
Participant's account attributable to assets other
than Company Stock acquired with the proceeds of an
Acquisition Loan shall be forfeited first.
(8) Timing of Deposit
The Employer shall pay to the Trustee the Employee
Stock Ownership Contributions at any time and from
time to time; except that the total Employee Stock
Ownership Contribution for any Plan Year shall be
paid in full not later than the time prescribed by
Code Section 404(a)(6) to enable the Employer to
obtain a deduction on its federal income tax return
for the Employer's taxable year. The total Employee
Stock Ownership Contribution for any Plan Year shall
be deemed made on the Anniversary Date of that Plan
Year.
(b) Withdrawals Before Separation from Service
The Plan does not permit withdrawal of Employee Stock
Ownership Contributions prior to separation from Service.
(c) Minimum Allocation for Top-Heavy Plan
(1) Minimum Allocation. Notwithstanding the foregoing,
for any Plan Year in which the Plan is determined to
be Top-Heavy, the amount of Employee Stock Ownership
Contributions and Forfeitures allocated to the
Employee Stock Ownership Account of each Non-Key
Employee shall be equal to the lesser of three
percent (3%) of each Non-Key Employee's Compensation
or the highest contribution rate for the Plan Year
made on behalf of any Key Employee. However, if a
defined benefit plan maintained by the Employer which
benefits a Key Employee depends on this Plan to
satisfy the nondiscrimination rules of Code Section
401(a)(4) or the coverage rules of Code Section 410
(or another plan benefitting the Key Employee so
depends on the defined benefit plan), the top heavy
minimum allocation is 3% of the Non-Key Employee's
Compensation regardless of the contribution rate for
the Key Employee.
(2) Compensation. For purposes of this Section,
Compensation means Compensation defined in Section
1.11 except (i) Compensation does not include
Employee Contributions, and (ii) any exclusions from
Compensation (other than the exclusion of Employee
Contributions and the exclusions described in clauses
(i) through (iv) of Section 1.11) do not apply.
Notwithstanding the definition of Compensation in
Section 1.11(v), the period preceding a Participant's
Entry Date shall be included in determining the
minimum top-heavy allocation provided by this
Section.
(3) Contribution Rate. For purposes of this Section, a
Participant's contribution rate is the sum of
employer contributions (not including employer
contributions to Social Security) and Forfeitures
allocated to the Participant's Accounts for the Plan
Year divided by his or her Compensation for the
entire Plan Year. To determine a Participant's
contribution rate, the Plan Administrator must treat
all qualified top-heavy defined contribution plans
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<PAGE> 33
maintained by the Employer (or by any related
Employers described in Section 1.35) as a single
plan. For purposes of this Section, for Plan Years
beginning after 1988, the following rules apply:
(i) Employer Elective Contributions (described
in Section 3.01 as Employee Contributions)
on behalf of Key Employees are taken into
account in determining the minimum required
contribution under Code Section 416(c)(2).
However, Employer Elective Contributions on
behalf of Employees other than Key Employees
may not be treated as Employer Contributions
for the minimum contribution or benefit
requirement of Code Section 416.
(ii) Company Matching Contributions allocated to
Key Employees are treated as employer
contributions for determining the minimum
contribution or benefit under Code Section
416. However, if a plan utilizes Matching
Contributions allocated to Employees other
than Key Employees as Employee After-Tax
Contributions or Elective Contributions to
satisfy the minimum contribution
requirement, the Matching Contributions are
not treated as Matching Contributions for
applying the requirements of Code Section
401(k) and 401(m).
(iii) Qualified Non-Elective Contributions
described in Code Section 401(m)(4)(C) may
be treated as employer contributions for the
minimum contribution or benefit requirement
of Code Section 416.
(4) Participant Entitled to Top-Heavy Minimum Allocation.
The minimum allocation under this Section shall be
provided to each Non-Key Employee who is a
Participant and is employed by the Employer on the
last day of the Plan Year, whether or not the
Participant has been credited with one thousand
(1,000) Hours of Service for the Plan Year. The
minimum allocation under this Section shall not be
provided to any Participant who was not employed by
the Employer on the last day of the Plan Year. The
provisions of this Section shall not apply to any
Participant to the extent the Participant is covered
under any other plan or plans of the Employer under
which the minimum allocation or benefit requirements
under Code Section 416(c)(1) or (c)(2) are met for
the Participant.
(5) Compliance. The Plan will satisfy the top-heavy
minimum allocation under this Section. The Plan
Administrator first will allocate the Employee Stock
Ownership Contributions (and Forfeitures, if any) for
the Plan Year pursuant to the allocation formula
under Section 3.04(a)(6). The Employer then will
contribute an additional amount for the Employee
Stock Ownership Account of any Participant entitled
under this Section to a top-heavy minimum allocation
and whose contribution rate for the Plan Year, under
this Plan and any other plan aggregated under this
Section, is less than the top-heavy minimum
allocation. The additional amount is the amount
necessary to increase the Participant's contribution
rate to the top-heavy minimum allocation. The Plan
Administrator will allocate the additional
contribution to the Account of the Participant on
whose behalf the Employer makes the contribution.
3.05 Rollover Contributions
(a) Eligible Employee
Each Employee who is a member of an Eligible Employee
Classification, regardless of whether
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<PAGE> 34
he is a Participant in the Plan, will have the right to make a
Rollover Contribution of cash (or other property of a form
acceptable to the Plan Administrator and the Trustee in
accordance with the Employer's written policy regarding
Rollover Contributions) into the Plan from another qualified
plan. If the Employee is not a Participant hereunder, his
Rollover Account will constitute his entire interest in the
Plan. In no event will the existence of a Rollover Account
entitle the Employee to participate in any other benefit
provided by the Plan.
If specifically provided for in a Written Resolution, Rollover
Contribution will also mean the amount of assets transferred,
pursuant to Section 10.05, to this Plan from another plan
which is qualified under Code Sections 401(a) and 501(a).
The amount received by the Trustee as a Rollover Contribution
shall be credited to the Participant's Rollover Account. A
Participant's Rollover Contribution shall not be forfeitable
nor reduce in any way the obligations of the Employer under
the Plan.
(b) Withdrawals
A Participant may withdraw all or any portion of his Rollover
Account at any time subject to the limitations of Sections
1.34 and 5.05.
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ARTICLE 4
ACCOUNTING AND VALUATION
4.01 General Powers of the Plan Administrator
The Plan Administrator will have the power to establish rules and
guidelines, which will be applied on a uniform and non-discriminatory
basis, as it deems necessary, desirable or appropriate with regard to
accounting procedures and to the timing and method of contributions to
and/or withdrawals from the Plan.
4.02 Valuation Procedure
(a) Accounts other than Employee Stock Ownership Accounts
As of the end of each Accounting Period on the Accounting
Date, the Plan Administrator will determine the fair market
value of each Specific Investment Fund being administered by
the Trustee. To determine the gain or loss of the Accounts in
each Specific Investment Fund, the Plan Administrator will
first calculate the change in value of each Specific
Investment Fund between the current Accounting Period and the
last preceding Accounting Period. The net gain or loss in each
Specific Investment Fund will be allocated to the accounts of
those Participants who are participating in each Specific
Investment Fund on the Accounting Date. The Plan Administrator
will then charge to the prior account balances all previously
uncharged payments or distributions made from the Accounts
since the last preceding Accounting Period. Finally, the Plan
Administrator will allocate and credit Employer Contributions
that are to be allocated and credited as of that date in
accordance with Article 3.
(b) Employee Stock Ownership Accounts
As of each Anniversary Date, any cash dividends paid on shares
of Company Stock allocated to Participants' Company Stock
Sub-Accounts will, as directed by the Plan Administrator, (a)
be invested in Company Stock through any dividend reinvestment
plan maintained by the Employer, (b) invested by the Trustee
in Company Stock as soon as practical after receipt, or (c)
allocated to the Other Investment Sub-Account of such
Participants; provided, however, that any cash dividends which
are currently distributed to Participants under Article 12
shall not be so allocated.
Cash dividends on shares of Company Stock in the suspense
account shall be used to make payments on an Acquisition Loan.
The shares of Company Stock released from the suspense account
as a result of such payment shall be allocated in the manner
described in Section 12.01.
Any stock dividends received on Company Stock shall be
credited to the Account (including the suspense account) to
which such Company Stock was allocated.
Notwithstanding the foregoing, an independent appraiser
meeting requirements similar to those prescribed by the
applicable Treasury regulations or Code Section 170(a)(1) must
perform all valuations of Company Stock not readily tradeable
on an established securities market.
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4.03 Specific Investment Funds
(a) The Plan Administrator will select the Investment Funds
available under the Plan in a separate written Investment
Policy. The Plan Administrator shall maintain such Investment
Funds in accordance with the Employer's written Investment
Policy. Such Investment Funds shall be communicated to
Participants in writing.
All Accounts, other than Company Stock Sub-Accounts, shall be
allocated by the Plan Administrator to the Plan's Investment
Funds specified in a separate written Investment Policy.
Dividends, interest and other distributions shall be
reinvested in the same Specific Investment Fund from which
received.
Except as provided hereafter in this Section, the assets of
each such Specific Investment Fund shall be invested
exclusively in shares of the registered investment company
designated by the Board, provided that such shares constitute
securities described in ERISA Section 401(b)(1). Amounts in
any such Specific Investment Fund in amounts estimated by the
Trustee to be needed for cash withdrawals, or in amounts too
small to be reasonably invested, or in amounts which the
Trustee deems to be in the best interest of the Participants,
may be retained by the Trustee in cash or invested
temporarily.
4.04 Participant Direction of Investment
(a) Application of this Section
Subject to the provisions of this Section, each Participant
will have the right to direct the investment of all of his or
her Accounts, other than his or her Employee Stock Ownership
Account, among the Investment Funds which are made available
by the Plan Administrator. The Employee Stock Ownership
Account may not be reinvested in other investment options
until the Participant qualifies to make diversification
withdrawals in accordance with the provisions of Section 12.02
from the Employee Stock Ownership Account.
(b) General Powers of the Trustee
The Trustee will have the power to establish rules and
guidelines as it deems necessary, desirable or appropriate
with regard to the directed investment of contributions in
accordance with this Section. Such rules and guidelines are
intended to comply with Section 404(c) of ERISA and the
regulations thereunder. Included in such powers, but not by
way of limitation, are the following powers and rights:
(1) To temporarily invest those contributions which are
pending directed investment in a Specific Investment
Fund, in the General Investment Fund or in some other
manner as determined by the Trustee.
(2) To establish rules with regard to the transfer of all
or any part of the balance of an Account or Accounts
of a given Participant from one Investment Fund to
another.
(3) To maintain any part of the assets of any Investment
Fund in cash, or in demand or short-term time
deposits bearing a reasonable rate of interest, or in
a short-term investment fund that provides for the
collective investment of cash balances or in other
cash equivalents having ready marketability,
including, but not limited to, U.S. Treasury Bills,
commercial paper, certificates of deposit, and
similar types of short-term securities, as may be
deemed necessary by the Trustee in its sole
discretion.
The Trustee will not be liable for any loss that results from
a Participant's exercise of control over the investment of the
Participant's Accounts. If the Participant fails to provide
adequate
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directions, the Plan Administrator will direct the investment
of the Participant's Account. The Trustee will have no duty to
review or make recommendations regarding a Participant's
investment directions.
(c) Accounting
The Plan Administrator will maintain a set of accounts for
each Investment Fund. The accounts of the Plan Administrator
for each Investment Fund will indicate separately the dollar
amounts of all contributions made to such Investment Fund by
or on behalf of each Participant from time to time. The Plan
Administrator will compute the net income from investments;
net profits or losses arising from the sale, exchange,
redemption, or other disposition of assets, and the pro rata
share attributable to each Investment Fund of the expenses of
the administration of the Plan and Trust and will debit or
credit, as the case may be, such income, profits or losses,
and expenses to the unsegregated balance in each Investment
Fund from time to time. To the extent that the expenses of the
administration of the Plan and Trust are not directly
attributable to a given Investment Fund, such expenses, as of
a given Accounting Date, will be prorated among each
Investment Fund; such allocation of expenses will, in general,
be performed in accordance with the guidelines which are
specified in this Article.
(d) Future Contributions
Each Participant who chooses to participate in the Plan will
elect the percentage of those contributions (which are subject
to Participant direction of investment) which is to be
deposited to each available Investment Fund. Such election
will be in effect until modified. If any Participant fails to
make an election by the appropriate date, he will be deemed to
have elected an Investment Fund(s) as determined by the Plan
Administrator. Elections will be limited to multiples of one
percent (or such other reasonable increments as determined by
the Plan Administrator).
(e) Change in Investment of Past Contributions
A Participant may file an election with the Plan Administrator
to shift the aggregate amount or reasonable increments (as
determined by the Plan Administrator) of the balance of his
existing Account or Accounts which are subject to Participant
direction of investment among the various Investment Funds at
any time. Elections will be limited to multiples of one
percent (or such other reasonable increments as determined by
the Plan Administrator).
(f) Changes in Investment Elections
Elections with respect to future contributions and/or with
respect to changes in the investment of past contributions
will be made in writing on a form provided by the Plan
Administrator, except that each Participant may authorize the
Plan Administrator in writing on an authorization form
provided by the Plan Administrator to accept such directions
as may be made by the Participant by use of a telephone voice
response system maintained for such purpose.
The Plan Administrator may establish additional rules and
procedures with respect to investment election changes
including, for example, the number of allowed changes per
specified period, the amount of reasonable fee, if any, which
will be charged to the Participant for making a change,
specified dates or cutoff dates for making a change, etc.
(g) Addition and Deletion of Specific Investment Funds
Specific Investment Funds may be made available from time to
time by the Trustee. Specific Investment Funds, as are from
time to time made available by the Trustee, may be deleted or
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added from time to time by the Plan Administrator. The Plan
Administrator will establish guidelines for the proper
administration of affected Accounts when a Specific Investment
Fund is added or deleted.
4.05 Nondiscrimination Requirements
(a) Definitions Applicable to the Nondiscrimination Requirements
The following definitions apply to this Section:
(1) Aggregate Limit
With respect to a given Plan Year, Aggregate Limit
means the greater of the sum of [(A) + (B)l or the
sum of [(C) + (D)l where:
(A) is equal to 125% of the greater of DP or CP;
(B) is equal to 2 percentage points plus the
lesser of DP or CP, not to exceed 2 times
the lesser of DP or CP;
(C) is equal to 125% of the lesser of DP or CP;
(D) is equal to 2 percentage points plus the
greater of DP or CP, not to exceed 2 times
the greater of DP or CP;
DP represents the Deferral Percentage for the
Non-highly Compensated Group eligible under
the Cash or Deferred Arrangement for the
Plan Year; and
CP represents the Contribution Percentage for
the Non-highly Compensated Group eligible
under the plan providing for the Employee
After-tax Contributions or Employer Matching
Contributions for the Plan Year beginning
with or within the Plan Year of the Cash or
Deferred Arrangement.
(2) Cash or Deferred Arrangement (CODA)
A Cash or Deferred Election is any election (or
modification of an earlier election) by an Employee
to have the Employer either:
o provide an amount to the Employee in the
form of cash or some other taxable benefit
that is not currently available, or
o contribute an amount to the Plan (or provide
an accrual or other benefit) thereby
deferring receipt of Compensation.
A Cash or Deferred Election will only be made with
respect to an amount that is not currently available
to the Employee on the date of election. Further, a
Cash or Deferred Election will only be made with
respect to amounts that would have (but for the Cash
or Deferred Election) become currently available
after the later of the date on which the Employer
adopts the Cash or Deferred Arrangement or the date
on which the arrangement first becomes effective.
A Cash or Deferred Election does not include a
one-time irrevocable election upon the Employee's
commencement of employment or first becoming an
Eligible Employee.
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<PAGE> 39
(3) Compensation
For purposes of this Section, Compensation means
Compensation as defined in Section 1.11. Compensation
in excess of the Statutory Compensation Limit is
disregarded.
The period used to determine an Employee's
Compensation for a Plan Year may be limited to that
portion of the Plan Year in which the Employee was an
Eligible Employee, provided that this method is
applied uniformly to all Eligible Employees under the
Plan for the Plan Year.
(4) Contribution Percentage
Contribution Percentage means, for any specified
group, the average of the ratios calculated (to the
nearest one-hundredth of one percent) separately for
each Participant in the group, of the amount of
Employee After-tax Contributions and Matching
Contributions which are made by or on behalf of each
Participant for a Plan Year to each Participant's
Compensation for the Plan Year.
For purposes of determining the Contribution
Percentage, each Employee who is eligible under the
terms of the Plan to make or to have contributions
made on his behalf is treated as a Participant. The
Contribution Percentage of an eligible Employee who
makes no Employee After-tax Contribution and receives
no Matching Contribution is zero.
The Contribution Percentage of a Participant who is a
Highly Compensated Employee for the Plan Year and who
is eligible to make Employee After-tax Contributions
or receive an allocation of Matching Contributions
(including Elective Contributions and Nonelective
Contributions which are treated as Employee or
Matching Contributions for purposes of the
Contribution Percentage Test) allocated to his
accounts under two or more plans which are sponsored
by the Employer will be determined as if the Employee
After-tax and Matching Contributions were made under
a single plan. For purposes of this paragraph, if a
Highly Compensated Employee participates in two or
more such plans which have different Plan Years, all
plans ending with or within the same calendar year
will be treated as a single plan.
(5) Contribution Percentage Test
The Contribution Percentage Test is a test applied on
a Plan Year basis to determine whether a plan meets
the requirements of Code Section 401(m).
In each of the following tests, the Contribution
Percentage for the Highly Compensated Group for a
Plan Year is compared with the Contribution
Percentage for the Non-highly Compensated Group for
the preceding Plan Year (or the current Plan Year if
elected by the Employer; provided, however, that if
such an election is made, it may not be changed
except as provided by the Secretary of the Treasury.)
In the case of the first Plan Year of the Plan (if
this is not a successor plan within the meaning of
Treasury Regulation 1.401(k)-1(d)(3)), the
Contribution Percentage for the Non-highly
Compensated Group will be the Contribution Percentage
for the Non-highly Compensated Group for the first
Plan Year or, if the Employer elects to use 3% as the
Deferral Percentage for the first Plan Year, the
Contribution Percentage that would result if the
Deferral Percentage for each Non-highly Compensated
Participant were 3%.
The Contribution Percentage Test may be met by either
satisfying the General
39
<PAGE> 40
Contribution Percentage Test or the Alternative
Contribution Percentage Test.
The General Contribution Percentage Test is satisfied
if the Contribution Percentage for the Highly
Compensated Group does not exceed 125% of the
Contribution Percentage for the Non-highly
Compensated Group.
The Alternative Contribution Percentage Test is
satisfied if the Contribution Percentage for the
Highly Compensated Group does not exceed the lesser
of:
o The Contribution Percentage for the
Non-highly Compensated Group plus 2
percentage points, or
o the Contribution Percentage for the
Non-highly Compensated Group multiplied by
2.0.
If (i) one or more Highly Compensated Employees of
the Employer or any Related Employer are eligible to
participate in both a Cash or Deferred Arrangement
and a plan which provides for Employee After-tax
Contributions or Matching Contributions, (ii) the
Deferral Percentage for the Highly Compensated Group
does not satisfy the General Deferral Percentage
Test, and (iii) the Contribution Percentage for the
Highly Compensated Group does not satisfy the General
Contribution Percentage Test, then the Contribution
Percentage Test will be deemed to be satisfied only
if the sum of the Deferral Percentage and the
Contribution Percentage for the Highly Compensated
Group does not exceed the Aggregate Limit.
The Plan will not fail to satisfy the Contribution
Percentage test merely because all of the Eligible
Employees under the Plan for a Plan Year are Highly
Compensated Employees.
(6) Deferral Percentage
Deferral Percentage means, for any specified group,
the average of the ratios calculated (to the nearest
one-hundredth of one percent) separately for each
Participant in the group, of the amount of Elective
Contributions which are made on behalf of each
Participant for a Plan Year to each Participant's
Compensation for the Plan Year.
For purposes of determining the Deferral Percentage,
each Employee who is eligible under the terms of the
Plan to have contributions made on his behalf is
treated as a Participant. The Deferral Percentage of
an eligible Employee who makes no Elective
Contribution is zero.
The Deferral Percentage of a Participant who is a
Highly Compensated Employee for the Plan Year and who
is eligible to have Elective Contributions (including
Nonelective Contributions or Matching Contributions
which are treated as Elective Contributions for
purposes of the Deferral Percentage Test) allocated
to his accounts under two or more Cash or Deferred
Arrangements which are maintained by the Employer
will be determined as if the Elective Contributions
were made under a single Arrangement. For purposes of
this paragraph, if a Highly Compensated Employee
participates in two or more Cash or Deferred
Arrangements which have different Plan Years, all
Cash or Deferred Arrangements ending with or within
the same calendar year will be treated as a single
Arrangement.
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<PAGE> 41
(7) Deferral Percentage Test
The Deferral Percentage Test is a test applied on a
Plan Year basis to determine whether a plan meets the
requirements of Code Section 401(k).
In each of the following tests, the Deferral
Percentage for the Highly Compensated Group for a
Plan Year is compared with the Deferral Percentage
for the Non-highly Compensated Group for the
preceding Plan Year (or the current Plan year if
elected by the Employer; provided, however, that if
such an election is made, it may not be changed
except as provided by the Secretary of the Treasury).
In the case of the first Plan Year of the Plan (if
this is not a successor plan within the meaning of
Treasury Regulation 1.401(k)-1(d)(3)), the Deferral
Percentage for the Non-highly Compensated Group will
be 3%, or, if elected by the Employer, the actual
Deferral Percentage for the Non-highly Compensated
Group for the first Plan Year.
The Deferral Percentage Test may be met by either
satisfying the General Deferral Percentage Test of
the Alternative Deferral Percentage Test.
The General Deferral Percentage Test is satisfied if
the Deferral Percentage for the Highly Compensated
Group does not exceed 125% of the Deferral Percentage
for the Non-highly Compensated Group.
The Alternative Deferral Percentage Test is satisfied
if the Deferral Percentage for the Highly Compensated
Group does not exceed the lesser of:
o the Deferral Percentage for the Non-highly
Compensated Group plus 2 percentage points,
or
o the Deferral Percentage for the Non-highly
Compensated Group multiplied by 2.0.
If (i) one or more Highly Compensated Employees of
the Employer or any Related Employer are eligible to
participate in both a Cash or Deferred Arrangement
and a plan which provides for Employee After-tax
Contributions or Matching Contributions, (ii) the
Deferral Percentage for the Highly Compensated Group
does not satisfy the General Deferral Percentage
Test, and (iii) the Contribution Percentage for the
Highly Compensated Group does not satisfy the General
Contribution Percentage Test, then the Deferral
Percentage Test will be deemed to be satisfied only
if the sum of the Deferral Percentage and the
Contribution Percentage for the Highly Compensated
Group does not exceed the Aggregate Limit.
The Plan will not fail to satisfy the Deferral
Percentage test merely because all of the Eligible
Employees under the Plan for a Plan Year are Highly
Compensated Employees.
(8) Elective Contribution
Elective Contribution means any contribution made by
the Employer to a Cash or Deferred Arrangement on
behalf of and at the election of an Employee. An
Elective Contribution will be taken into account for
a given Plan Year only if:
o The Elective Contribution is allocated to
the Participant's Account as of a date
within the Plan Year to which it relates;
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<PAGE> 42
o The allocation is not contingent upon the
Employee's participation in the Plan or
performance of services on any date after
the allocation date;
o The Elective Contribution is actually paid
to the trust no later than 12 months after
the end of the Plan Year to which the
Elective Contribution relates; and
o The Elective Contribution relates to
Compensation which either (i) but for the
Participant's election to defer, would have
been received by the Participant in the Plan
Year or (ii) is attributable to services
performed by the Participant in the Plan
Year and, but for the Participant's election
to defer, would have been received by the
Participant within two and one-half months
after the close of the Plan Year.
Elective Contributions will be treated as Employer
Contributions for purposes of Code Sections 401(a),
401(k), 402(a), 404, 409, 411, 412, 415, 416, and
417.
(9) Elective Deferral
Elective Deferral means the sum of the following:
o Any Elective Contribution to any Cash or
Deferred Arrangement to the extent it is not
includable in the Participant's gross income
for the taxable year of contribution;
o Any employer contribution to a simplified
employee pension as defined in Code Section
408(k) to the extent not includable in the
Participant's gross income for the taxable
year of contribution;
o Any employer contribution to an annuity
contract under Code Section 403(b) under a
salary reduction agreement to the extent not
includable in the Participant's gross income
for the taxable year of contribution; plus
o Any employee contribution designated as
deductible under a trust described in Code
Section 501(c)(18) for the taxable year of
contribution.
(10) Eligible Employee
Eligible Employee means an Employee who is directly
or indirectly eligible to make a Cash or Deferred
Election under the Plan for all or a portion of the
Plan Year. An Employee who is unable to make a Cash
or Deferred Election because the Employee has not
contributed to another plan is also an Eligible
Employee. An Employee who would be eligible to make
Elective Contributions but for a suspension due to a
distribution, a loan, or an election not to
participate in the Plan, is treated as an Eligible
Employee for purposes of Code Section 401(k)(3) and
401(m) for a Plan Year even though the Employee may
not make a Cash or Deferred Election due to the
suspension. Also, an Employee will not fail to be
treated as an Eligible Employee merely because the
employee may receive no additional Annual Additions
because of Code Section 415(c)(1) or 415(e).
(11) Employee After-tax Contribution
Employee After-tax Contribution means any
contribution made by an Employee to any plan
maintained by the Employer or any Related Employer
which is other than an
42
<PAGE> 43
Elective Contribution and which is designated or
treated at the time of contribution as an after-tax
contribution. Employee After-tax Contributions
include amounts attributable to Excess Contributions
which are recharacterized as Employee After-tax
Contributions.
(12) Excess Contribution
Excess Contribution means, for each member of the
Highly Compensated Group, the amount of Elective
Contribution (including any Qualified Nonelective
Contributions and Qualified Matching Contributions
which are treated as Elective Contributions) which
exceeds the maximum contribution which could be made
if the Deferral Percentage Test were to be satisfied.
(13) Excess Aggregate Contribution
Excess Aggregate Contribution means, for each member
of the Highly Compensated Group, the amount of
Employee After-tax and Matching Contributions
(including any Qualified Nonelective Contributions
and Elective Contributions which are treated as
Matching Contributions) which exceeds the maximum
contribution which could be made if the Contribution
Percentage Test were to be satisfied.
(14) Excess Deferral
Excess Deferral means, for a given calendar year,
that amount by which each Participant's total
Elective Deferrals under all plans of all employers
exceed the dollar limit in effect under Code Section
402(g) for the calendar year.
(15) Matching Contribution
Matching Contribution means any contribution made by
the Employer to any plan maintained by the Employer
or any Related Employer which is based on an Elective
Contribution or an Employee After-tax Contribution
together with any forfeiture allocated to the
Participant's Account on the basis of Elective
Contributions, Employee After-tax Contributions or
Matching Contributions. A Matching Contribution will
be taken into account for a given Plan Year only if:
o The Matching Contribution is allocated to a
Participant's Account as of a date within
the Plan Year to which it relates;
o The allocation is not contingent upon the
Employee's participation in the Plan or
performance of services on any date after
the allocation date;
o The Matching Contribution is actually paid
to the Trust no later than 12 months after
the end of the Plan Year to which the
Matching Contribution relates; and
o The Matching Contribution is based on an
Elective or Employee After-tax Contribution
for the Plan Year.
Any contribution or allocation, other than a
Qualified Nonelective Contribution, which is used to
meet the minimum contribution or benefit requirement
of Code Section 416 is not treated as being based on
Elective Contributions or Employee After-tax
Contributions and therefore is not treated as a
Matching Contribution.
Qualified Matching Contribution means a Matching
Contribution which is 100% vested
43
<PAGE> 44
and may be withdrawn or distributed only under the
conditions described in Treasury Regulation
1.401(k)-l(d).
(16) Nonelective Contribution
Nonelective Contribution means any Employer
Contribution, other than a Matching Contribution,
which meets all of the following requirements:
o The Nonelective Contribution is allocated to
a Participant's Account as of a date within
the Plan Year to which it relates;
o The allocation is not contingent upon the
Employee's participation in the Plan or
performance of services on any date after
the allocation date;
o The Nonelective Contribution is actually
paid to the Trust no later than 12 months
after the end of the Plan Year to which the
Non,elective Contribution relates; and
o The Employee may not elect to have the
Nonelective Contribution paid in cash in
lieu of being contributed to the Plan.
Qualified Nonelective Contribution means a
Nonelective Contribution which is 100% vested and may
be withdrawn or distributed only under the conditions
described in Treasury Regulation 1.401(k)-l(d).
(b) Application of Deferral Percentage Test
All Elective Contributions, including any Elective
Contributions which are treated as Employee After-tax or
Matching Contributions with respect to the Contribution
Percentage Test, must satisfy the Deferral Percentage Test.
Furthermore, any Elective Contributions which are not treated
as Employee After-tax or Matching Contributions with respect
to the Contribution Percentage Test must satisfy the Deferral
Percentage Test. The Plan Administrator will determine as soon
as administratively feasible after the end of the Plan Year
whether the Deferral Percentage Test has been satisfied. If
the Deferral Percentage Test is not satisfied, the Employer
may elect to make an additional contribution to the Plan on
account of the Non-highly Compensated Group. The additional
contribution will be treated as a Nonelective Contribution.
If the Deferral Percentage Test is not satisfied after any
Nonelective Contributions, the Plan Administrator may, in its
sole discretion, recharacterize all or any portion of the
Excess Contribution of each Highly Compensated Employee as an
Employee After-tax Contribution if Employee After-tax
Contributions are otherwise allowed by the Plan. If so, the
Plan Administrator will notify all affected Participants and
the Internal Revenue Service of the amount recharacterized no
later than the 15th day of the third month following the end
of the Plan Year in which the Excess Contribution was made.
Excess Contributions will be includable in the Participant's
gross income on the earliest date any Elective Contribution
made on behalf of the Participant during the Plan Year would
have been received by the Participant had the Participant
elected to receive the amount in cash. Recharacterized Excess
Contributions will continue to be treated as Employer
Contributions that are Elective Contributions for all other
purposes under the Code, including Code Sections 401(a) (other
than 401(a)(4) and 401(m)), 404, 409, 411, 412, 415, 416, 417
and 401(k)(2). With respect to the Plan Year for which the
Excess Contribution was made, the Plan Administrator will
treat the recharacterized amount as an Employee After-tax
Contribution for purposes of the Deferral Percentage Test and
the Contribution Percentage Test and for purposes of
determining whether the Plan meets the requirements of Code
Section
44
<PAGE> 45
401(a)(4), but not for any other purposes under this Plan.
Therefore, recharacterized amounts will remain subject to the
nonforfeiture requirements and distribution limitations which
apply to Elective Contributions.
If the Deferral Percentage Test is still not satisfied, then
after the close of the Plan Year in which the Excess
Contribution arose but within 12 months after the close of
that Plan Year, the Plan Administrator will distribute the
Excess Contributions, together with allocable income, to
Participants of the Highly Compensated Group. Failure to do so
will cause the Plan to not satisfy the requirements of Code
Section 401(a)(4) for the Plan Year for which the Excess
Contribution was made and for all subsequent Plan Years for
which the Excess Contribution remains uncorrected.
The amount of Excess Contribution to be distributed to a
Highly Compensated Employee for a Plan Year will be reduced by
any Excess Deferrals previously distributed to the Participant
for the calendar year ending with or within the Plan Year in
accordance with Code Section 402(g)(2).
Excess Contributions will be treated as Employer Contributions
for purposes of Code Sections 404 and 415 even if distributed
from the Plan.
(c) Application of Contribution Percentage Test
Employee After-tax Contributions and Matching Contributions,
disregarding any Matching Contributions which are treated as
Elective Contributions with respect to the Deferral Percentage
Test, must satisfy the Contribution Percentage Test. The Plan
Administrator will determine as soon as administratively
feasible after the end of the Plan Year whether the
Contribution Test has been satisfied. If the Contribution
Percentage Test is not satisfied, the Employer may elect to
make an additional contribution to the Plan for the benefit of
the Non-Highly Compensated Group. The additional contribution
will be treated as a Nonelective Contribution.
If the Contribution Percentage Test is still not satisfied,
then after the close of the Plan Year in which the Excess
Aggregate Contribution arose but within 12 months after the
close of that Plan Year, the Plan Administrator will
distribute (or forfeit, to the extent not vested) the Excess
Aggregate Contributions, together with allocable income, to
Participants of the Highly Compensated Group. Failure to do so
will cause the Plan to not satisfy the requirements of Code
Section 401(a)(4) for the Plan Year for which the Excess
Aggregate Contribution was made and for all subsequent Plan
Years for which the Excess Aggregate Contribution remains
uncorrected.
The determination of any Excess Aggregate Contributions will
be made after the recharacterization of any Excess
Contributions as Employee After-tax Contributions.
Excess Aggregate Contributions, including forfeited Matching
Contributions, will be treated as Employer Contributions for
purposes of Code Sections 404 and 415 even if they are
distributed from the Plan.
Forfeited Matching Contributions that are reallocated to the
Accounts of other Participants are treated as Annual Additions
under Code Section 415 for the Participant whose Accounts they
are reallocated to and for the Participants from whose
Accounts they are forfeited.
(d) Reduction of Excess Amounts
For the purpose of determining the total amounts of Excess
Contributions and/or Excess Aggregate Contributions to be
recharacterized, returned to Participants, or forfeited, as
the case
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<PAGE> 46
may be, the Administrator shall take the following steps.
First, the Administrator shall calculate both the Deferral
Percentage or the Contribution Percentage of the affected
Participant(s) and the percentage of Excess Contributions or
Excess Aggregated Contributions, as applicable. Second, the
Administrator shall calculate the total dollar amount by which
the Deferral Percentage or Contribution Percentage for the
Highly Compensated Employee group must be reduced in order to
satisfy the Deferral Percentage Test or the Contribution
Percentage Test, as applicable. Third, the Administrator shall
calculate the total dollar amount of the Excess Contributions
or Excess Deferrals for the affected Highly Compensated
Employee(s). Fourth, the Excess Contributions or Excess
Aggregate Contributions, as applicable, of the Highly
Compensated Employee(s) with the highest dollar amount of
Excess Contributions or Excess Aggregate Contributions, as
applicable, will be reduced by refunding, recharacterizing or
forfeiting, as applicable, in the amount of Employee
Contributions or Company Matching Contributions, as
applicable, by the amount required to cause the dollar amount
of such Highly Compensated Employee(s)' Employee Contributions
or Company Matching Contributions, as applicable, necessary to
equal the dollar amount of Employee Contributions or Company
Matching Contributions of the Highly Compensated Employee(s)
with the next highest dollar amount of Employee Contributions
or Company Matching Contributions. If the total amount
distributed, recharacterized, or forfeited, as applicable, is
less than the total Excess Contributions or Excess Aggregate
Contributions, this Section shall be applied to the Highly
Compensated Employee(s) with the next highest dollar amount of
Excess Contributions or Excess Aggregate Contributions, as
applicable; this reduction shall continue until the total
amount of reduced, refunded or forfeited Excess Contributions
or Excess Aggregate Contributions, as applicable, equals the
total dollar amount calculated above. When calculating the
amount of a distribution, recharacterization, or forfeiture,
if a lessor reduction, when added to any amounts already
distributed, recharacterized, or forfeited, as applicable,
under this Section, would equal the total required
distribution, recharacterization, or forfeiture, as
applicable, necessary to permit the Plan to satisfy the
requirements of this Section, the lesser amount of reductions,
recharacterizations, or forfeitures shall be applied.
(e) Priority of Reductions
The Plan Administrator will correct Excess Contributions and
Excess Aggregate Contributions as follows. The method of
correcting Excess Contributions and Excess Aggregate
Contributions must meet the requirements of Code Section
401(a)(4). The determination of whether a rate of Matching
Contribution discriminates under Code Section 401(a)(4) will
be made after making any corrective distributions of Excess
Deferrals, Excess Contributions and Excess Aggregate
Contributions.
Excess Aggregate Contributions (and any attributable income)
will be corrected first, by distributing any excess Employee
After-tax Contributions (and any attributable income); then by
distributing vested excess Matching Contributions (and any
attributable income); and finally, by forfeiting or
distributing non-vested Matching Contributions (and any
attributable income). The Plan will not distribute Employee
After-tax Contributions while the Matching Contributions based
upon those Employee After-tax Contributions remain allocated.
(f) Income
The income allocable to any Excess Contribution made to a
given Account for a given Plan Year will be equal to the total
income allocated to the Account for the Plan Year, multiplied
by a fraction, the numerator of which is the amount of the
Excess Contribution and the denominator of which is equal to
the sum of the balance of the Account at the beginning of the
Plan Year plus the Participant's Elective Contributions and
amounts treated as Elective Contributions for the Plan Year.
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<PAGE> 47
The income allocable to any Excess Aggregate Contribution made
to a given Account for a given Plan Year will be equal to the
total income allocated to the Account for the Plan Year,
multiplied by a fraction, the numerator of which is the amount
of the Excess Aggregate Contribution and the denominator of
which is equal to the sum of the balance of the Account at the
beginning of the Plan Year plus the Participant's Employee
After-tax and Matching Contributions and amounts treated as
Employee After-tax and Matching Contributions for the Plan
Year.
Notwithstanding the foregoing, the Plan may use any reasonable
method for computing the income allocable to any Excess
Contribution or Excess Aggregate Contribution provided the
method does not violate Code Section 401(a)(4), is used
consistently for all corrective distributions under the Plan
for the Plan Year, and is used by the Plan for allocating
income to the Participants' Accounts.
Income includes all earnings and appreciation, including
interest, dividends, rents, royalties, gains from the sale of
property, and appreciation in the value of stocks, bonds,
annuity and life insurance contracts and other property,
regardless of whether the appreciation has been realized.
(g) Treatment as Elective Contributions
The Plan Administrator may, in its discretion, treat all or
any portion of Qualified Nonelective Contributions or
Qualified Matching Contributions or both, whether to this Plan
or to any other qualified plan which has the same Plan Year
and is maintained by the Employer or a Related Employer, as
Elective Contributions for purposes of satisfying the Deferral
Percentage Test if they meet all of the following
requirements:
o All Nonelective Contributions, including the
Qualified Nonelective Contributions treated as
Elective Contributions for purposes of the Deferral
Percentage Test, satisfy the requirements of Code
Section 401(a)(4);
o Any Nonelective Contributions which are not treated
as Elective Contributions for purposes of the
Deferral Percentage Test or as Matching Contributions
for purposes of the Contribution Percentage Test
satisfy the requirements of Code Section 401(a)(4);
o The Qualified Matching Contributions which are
treated as Elective Contributions for purposes of the
Deferral Percentage Test are not taken into account
in determining whether any Employee After-tax
Contributions or other Matching Contributions satisfy
the Contribution Percentage Test;
o Any Matching Contributions which are not treated as
Elective Contributions for purposes of the Deferral
Percentage Test satisfy the requirements of Code
Section 401(m); and
o The plan which includes the Cash or Deferred
Arrangement and the plan or plans to which the
Qualified Nonelective Contributions and Qualified
Matching Contributions are made could be aggregated
for purposes of Code Section 410(b).
(h) Treatment as Matching Contributions
The Plan Administrator may, in its discretion, treat all or
any portion of Qualified Nonelective Contributions or Elective
Contributions or both, whether to this Plan or to any other
qualified plan which has the same Plan Year and is maintained
by the Employer or a Related Employer, as Matching
Contributions for purposes of satisfying the Contribution
Percentage Test if they meet all of the following
requirements:
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<PAGE> 48
o All Nonelective Contributions, including the
Qualified Nonelective Contributions treated as
Matching Contributions for purposes of the
Contribution Percentage Test, satisfy the
requirements of Code Section 401(a)(4);
o Any Nonelective Contributions which are not treated
as Elective Contributions for purposes of the
Deferral Percentage Test or as Matching Contributions
for purposes of the Contribution Percentage Test
satisfy the requirements of Code Section 401(a)(4);
o The Elective Contributions which are treated as
Matching Contributions for purposes of the
Contribution Percentage Test are not taken into
account in determining whether any other Elective
Contributions satisfy the Deferral Percentage Test;
o The Qualified Nonelective Contributions and Elective
Contributions which are treated as Matching
Contributions for purposes of the Contribution
Percentage Test are not taken into account in
determining whether any other contributions or
benefits satisfy Code Section 401(a);
o All Elective Contributions, including those treated
as Matching Contributions for purposes of the
Contribution Percentage Test, satisfy the
requirements of Code Section 401(k)(3); and
o The plan that takes Qualified Nonelective
Contributions and Elective Contributions into account
in determining whether Employee After-tax and
Matching Contributions satisfy the requirements of
Code Section 401(m)(2)(A) and the plan or plans to
which the Qualified Nonelective Contributions and
Elective Contributions are made could be aggregated
for purposes of Code Section 410(b).
(i) Aggregation of Plans
If the Employer or a Related Employer sponsors one or more
other plans which include a Cash or Deferred Arrangement, the
Employer may elect to treat any two or more of such plans as
an aggregated single plan for purposes of satisfying Code
Sections 401(a)(4), 401(k) and 410(b). The Cash or Deferred
Arrangements included in such aggregated plans will be treated
as a single Arrangement for purposes of this Section. However,
only those plans that have the same plan year may be so
aggregated.
If the Employer or a Related Employer sponsors one or more
other plans to which Employee After-tax Contributions or
Matching Contributions are made, the Employer may elect to
treat any two or more of such plans as an aggregated single
plan for purposes of satisfying Code Sections 401(a)(4),
401(m) and 410(b). However, only those plans that have the
same plan year may be so aggregated.
Any such aggregation must be made in accordance with Treasury
Regulation 1.401(k)-1(b)(3). For example, contributions and
allocations under the portion of a plan described in Code
Section 4975(e)(7) (an ESOP) may not be aggregated with the
portion of a plan not described in Code Section 4975(e)(7) (a
non-ESOP) for purposes of determining whether the ESOP or
non-ESOP satisfies the requirements of Code Sections
401(a)(4), 401(k), 401(m) and 410(b).
Plans that could be aggregated under Code Section 410(b) but
that are not actually aggregated for a Plan Year for purposes
of Code Section 410(b) may not be aggregated for purposes of
Code
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Sections 401(k) and 401(m).
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ARTICLE 5
RETIREMENT BENEFITS
5.01 Valuation of Accounts
For purposes of this Article, the value of a Participant's Accrued
Benefit will be determined as of the Valuation Date immediately
preceding the date that benefits are to be distributed.
5.02 Normal Retirement
After an Active Participant reaches his Normal Retirement Date, he may
elect to retire. Upon such retirement he will become a Retired
Participant and his Accrued Benefit will become distributable to him. A
Participant's Accrued Benefit will become nonforfeitable no later than
the date upon which he attains his Normal Retirement Age. The form and
timing of benefit payment will be governed by the provisions of Section
5.05.
5.03 Disability Retirement
In the event of a Participant's termination due to Disability, he will
be entitled to begin to receive a distribution of his Accrued Benefit
which will become nonforfeitable as of his Date of Termination. The
form of benefit payment will be governed by the provisions of Section
5.05.
Disability shall mean a Participant's total and permanent disability as
a result of a disease or bodily injury which renders the Participant
incapable of engaging in substantial gainful activity, and as a result
of such disability he is qualified for and is receiving either (a)
disability benefits under the Social Security Act or (b) payments
(other than Worker's Compensation or Health Care Benefits) payable
directly or indirectly by the Employer or its' insurer as a result of
the Participant's sickness or injury under any long term disability
program maintained by the Employer.
5.04 Termination of Employment
(a) In General
If a Participant's employment terminates for any reason other
than retirement, death, or disability, his Accrued Benefit
will become distributable to him as of the last day of the
month which coincides with or next follows the last date upon
which any contributions on the Participant's behalf are made
to the Trust following the Participant's Date of Termination
of employment (or as of such earlier date as determined by the
Plan Administrator in a uniform and nondiscriminatory manner).
The form and timing of benefit payment will be governed by the
provisions of Section 5.05.
(b) Cash-Out Distribution
If a Participant terminates employment and receives a
distribution equal to 100% of his Employee Account and the
Vested Percentage of his Company Matching and Employee Stock
Ownership Accounts, a Cash-Out Distribution will be deemed to
have occurred if the following conditions are met:
(1) The Participant was less than 100% vested in his
Company Matching and Employee Stock Ownership
Accounts; and
(2) The entire distribution is made before the last day
of the second Plan Year following the Plan Year in
which the Participant terminated employment.
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(c) Restoration of Company Matching and Employee Stock Ownership
Accounts
If, following the date of a Cash-Out Distribution, a
Participant returns to an Eligible Employee Classification
prior to incurring 5 consecutive One Year Breaks-in-Service,
then the Participant will have the right to repay to the
Trustee, within 5 years after his return date, the portion of
the Cash-Out Distribution which was attributable to his
Company Matching and Employee Stock Ownership Accounts in
order to restore such Accounts to their value as of the date
of the Cash-Out Distribution.
The Plan Administrator will restore an eligible Participant's
Company Matching and Employee Stock Ownership Accounts as of
the Accounting Date coincident with or immediately following
the complete repayment of the Cash-Out Distribution. To
restore the Participant's Company Matching and Employee Stock
Ownership Accounts, the Plan Administrator, to the extent
necessary, will, under rules and guidelines applied in a
uniform and nondiscriminatory manner, first allocate to the
Participant's Company Matching and Employee Stock Ownership
Accounts the amount, if any, of Forfeitures which would
otherwise be allocated under Article 3. To the extent such
forfeitures for a particular Accounting Period are
insufficient to enable the Plan Administrator to make the
required restoration, the Employer will contribute such
additional amount as is necessary to enable the Plan
Administrator to make the required restoration. The Plan
Administrator will not take into account the allocation under
this Section in applying the limitation on allocations under
Article 7.
(d) Non-Vested Participant
If a Participant who is zero percent vested in his Company
Matching and Employee Stock Ownership Accounts terminates
employment, a Cash-Out Distribution will be deemed to have
occurred as of the Participant's Date of Termination of
employment.
If the Participant subsequently returns to an Eligible
Employee Classification prior to incurring five (5)
consecutive One Year Breaks-in-Service, then the Participant
will immediately become entitled to a complete restoration of
his Company Matching and Employee Stock Ownership Accounts as
of the Accounting Date coincident with or next following his
date of re-employment. Such restoration will be made in
accordance with the provisions of Section 5.04(c).
5.05 Form of Benefit Payment
Subject to the provisions of Section 5.06, the Plan Administrator will
direct the Trustee to make the payment of any benefit provided under
this Plan upon the event giving rise to such benefit within 60 days
following the receipt of a Participant's written request for the
payment of benefits on a form provided by the Plan Administrator. The
Plan Administrator may temporarily suspend such processing in the event
of unusual or extraordinary circumstances such as the conversion of
Plan records from one recordkeeper to another.
The form of benefit will be determined as follows:
(a) a Participant who is not married on the date benefits are to
commence will be provided a Qualified Life Annuity, unless a
lump sum payment is elected, under a Qualified Election, by
the Participant within the 90-day period which ends on his
benefit commencement date.
(b) a Participant who is married on the date benefits commence
will be provided a Qualified Joint and Survivor Annuity unless
a lump sum payment is elected, under a Qualified Election, by
the Participant within the 90-day period which ends on his
benefit commencement date.
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Within the 90-day period which ends on a married Participant's expected
benefit commencement date, the Plan Administrator will provide each
Participant with a written explanation of:
(a) the terms and conditions of a Qualified Joint and Survivor
Annuity;
(b) the Participant's right to make and the effect of a Qualified
Election to waive the Qualified Joint and Survivor Annuity
form of benefit;
(c) the rights of a Participant's spouse; and
(d) the right to make, and the effect of, a revocation of a
previous Qualified Election to waive the Qualified Joint and
Survivor Annuity.
Notwithstanding the above, if a terminated Participant's Vested Accrued
Benefit is $3,500 or less, such Participant's Vested Accrued Benefit
shall be payable in a lump sum of the entire amount of his Vested
Accrued Benefit. If the value of his Vested Accrued Benefit at the time
of any distribution exceeds $3,500, the value of his Vested Accrued
Benefit at any later time will be deemed to also exceed $3,500.
Upon request, the Participant may receive his benefit paid in a series
of substantially equal annual or more frequent installments from the
Trust Fund over a period certain not extending beyond the end of the
period measured by the joint life and last survivor expectancy of the
Participant and his spouse. A Participant may elect to receive an
installment distribution in the form of a Nontransferable Annuity
Contract. The Plan Administrator and the Trustee will have the power to
establish rules and guidelines as deemed necessary or appropriate with
regard to the payment of benefits under the installment payment form.
Notwithstanding the foregoing, if Company Stock acquired with the
proceeds of an Acquisition Loan available for distribution consist of
more than one class, a distributee must receive substantially the same
proportion of each class. A Participant entitled to a distribution
under this Section shall have the right to demand that all payments
under the foregoing paragraphs be made in Company Stock or in cash for
fractional shares to the extent his or her Accounts are invested in
Company Stock. A Participant's benefits attributable to Company Stock
may be paid in whole or in part in cash.
5.06 Commencement of Benefit
Subject to the provisions of this Article, commencement of a benefit
will, unless the Participant elects otherwise in writing, begin not
later than the 60th day after the later of the close of the Plan Year
in which the Participant attains Normal Retirement Age or the close of
the Plan Year which contains the date the Participant terminates his
service with the Employer.
Payment of a Participant's benefits must begin no later than his
Required Beginning Date.
All distributions required under this Section will be determined and
made in accordance with the regulations issued under Code Section
401(a)(9), including those dealing with minimum distribution
requirements. Notwithstanding the provisions of Section 5.05, an Active
Participant who has reached his Required Beginning Date will receive an
annual distribution of his Accrued Benefit equal to the minimum
required distribution determined under Code Section 401(a)(9).
For purposes of this Section, life expectancy and joint and last
survivor expectancy are to be computed by the use of the return
multiples contained in Section 1.72-9 of the Income Tax Regulations.
If the Participant dies after distribution of his interest has begun,
the remaining portion of the interest will
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continue to be distributed at least as rapidly as under the method of
distribution being used before the Participant's death.
5.07 Special Distribution and Payment Requirements
Notwithstanding any contrary provision, unless other Plan distribution
provisions require earlier distribution of the Participant's Accounts,
if the Participant elects, the Plan Administrator shall direct the
Trustee to commence distribution of that portion of the Participant's
Accrued Benefit attributable to Company Stock in the Participant's
Company Stock Sub-Account acquired by the Plan after December 31, 1986,
as follows:
(a) If the Participant retires, dies or is disabled, distribution
of the Participant's Accrued Benefit attributable to Company
Stock acquired after December 31, 1986, will begin no later
than one (1) year after the close of the Plan Year in which
the Participant separates from Service on account of death,
disability or attainment of Normal Retirement Age.
(b) If the Participant separates from Service for any reason other
than attainment of Normal Retirement Age, death or disability,
the Plan Administrator shall direct the Trustee to commence
distribution of the Participant's Accrued Benefit no later
than one (1) year after the close of the Plan Year which is
the fifth (5th) Plan Year following the Plan Year in which the
Participant separates from Service for any reason other than
attainment of Normal Retirement Age, death or disability.
(c) If the Participant resumes employment with the Employer on or
before the last day of the fifth (5th) Plan Year following the
Plan Year of the Participant's separation from Service, the
distribution provisions of this paragraph will not apply until
the Participant again may separate from Service for any other
reason other than attainment of Normal Retirement Age, death
or disability.
This distribution requirement is subject to the form of distribution
requirements of Section 5.05. For purposes of this paragraph, Company
Stock does not include any Company Stock acquired with the proceeds of
an Acquisition Loan until the close of the Plan Year in which the
borrower repays the Acquisition Loan in full.
Unless the Participant elects otherwise, a distribution of the
Participant's Accrued Benefit attributable to Company Stock acquired
after December 31, 1986, in the Participant's Company Stock
Sub-Account, will be in substantially equal periodic payments (not less
frequently than annually) over a period not longer than the greater of
(A) five (5) years, or (B) in the case of a Participant with an Accrued
Benefit in excess of $500,000, five (5) years plus one (1) additional
year (but not more than five (5) additional years) for each $100,000 or
fraction thereof by which the balance exceeds $500,000.
The portion of a Participant's Accrued Benefit attributable to Company
Stock which was acquired by the Plan after December 31, 1986, shall be
determined by multiplying the number of shares of such securities held
in the account by a fraction, the numerator of which is the number of
shares acquired by the Plan after December 31, 1986, and allocated to
the Participant's Company Stock Sub-Accounts (not to exceed the number
of shares held by the Plan on the date of distribution) and the
denominator of which is the total number of shares held by the Plan at
the date of distribution.
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5.08 Directed Transfer of Eligible Rollover Distributions
(a) General
Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a Distributee's election under this
Section, a Distributee may elect, at the time and in the
manner prescribed by the Plan Administrator, to have any
portion of an Eligible Rollover Distribution paid directly to
an Eligible Retirement Plan specified by the Distributee in a
Direct Rollover.
(b) Eligible Rollover Distribution
An Eligible Rollover Distribution is any distribution of all
or any portion of the balance to the credit of the
Distributee, except that an Eligible Rollover Distribution
does not include: any distribution that is one of a series of
substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the
Distributee or the joint lives (or joint life expectancies) of
the Distributee and the Distributee's designated beneficiary,
or for a specified period of ten years or more; any
distribution to the extent such distribution is required under
Section 401(a)(9) of the Code; and the portion of any
distribution that is not includable in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
(c) Eligible Retirement Plan
An Eligible Retirement Plan is an individual retirement
account described in section 408(a) of the Code, an individual
retirement annuity described in section 408(b) of the Code, or
a qualified trust described in section 401(a) of the Code,
that accepts the Distributee's Eligible Rollover Distribution.
However, in the case of an Eligible Rollover Distribution to
the surviving spouse, an Eligible Retirement Plan is an
individual retirement account or individual retirement
annuity.
(d) Distributee
A Distributee includes an Employee or Former Employee. In
addition, the Employee's or Former Employee's surviving spouse
and the Employee's or Former Employee's spouse or former
spouse who is the alternate payee under a qualified domestic
relations order, as defined in Section 414(p) of the Code, are
Distributees with regard to the interest of the spouse or
former spouse.
(e) Direct Rollover
A Direct Rollover is a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
(f) Waiver of 30-Day Notice
If a distribution is one to which Code Sections 401(a)(11) and
417 do not apply, such distribution may commence less than 30
days after the notice required under Section 1.411(a)-11(c) of
the Income Tax Regulations is given, provided that:
o the Plan Administrator clearly informs the
Participant that the Participant has a right to a
period of at least 30 days after receiving the notice
to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular
distribution option); and
o the Participant, after receiving the notice,
affirmatively elects to receive a distribution.
5.09 Indefinite Layoff
If a full time permanent Employee who is a Participant is indefinitely
laid off due to a lack of work or
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economic or industrial reasons, his vested percentage shall be one
hundred percent (100%).
Prior to July 1, 1994, if such a Participant does not receive a
distribution of any part of his Accounts under the Plan until after the
end of the Plan year in which his layoff occurred, he shall be entitled
to share in the allocation of Forfeitures on the last day of the Plan
Year during which such layoff occurred as if:
(a) he had completed at least 1,000 Hours of Service during such
Plan Year; and
(b) he was an active Participant on the last day of such Plan
Year.
After July 1, 1994, Participant's who are indefinitely laid off will
not share in the allocation of Forfeitures on the last day of the Plan
Year during which such layoff occurs.
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ARTICLE 6
DEATH BENEFIT
6.01 Valuation of Accounts
For purposes of this Article, the value of a Participant's Accrued
Benefit will be determined as of the Valuation Date immediately
preceding the date that benefits are to be distributed.
6.02 Death Benefit
(a) Pre-Retirement Death Benefit
In the event of the death of a Participant prior to the date
that he begins to receive a retirement benefit under the Plan,
if the Participant has a Surviving Spouse and if a Beneficiary
other than the Participant's Surviving Spouse has not been
designated pursuant to a Qualified Election, the Participant's
Surviving Spouse will be entitled to receive a Qualified
Survivor Annuity.
If a Surviving Spouse does not exist or if a Beneficiary other
than the Participant's Surviving Spouse has been designated
pursuant to a Qualified Election, the Participant's designated
Beneficiary will be entitled to receive the value of the
Participant's Accrued Benefit.
(b) Post-Retirement Death Benefit
In the event of the death of a Retired Participant or a
Disabled Participant receiving a benefit, a benefit will be
paid to the Participant's Beneficiary or Surviving Spouse in
accordance with the form of benefit payment elected under the
Plan.
6.03 Designation of Beneficiary
Each Participant will be given the opportunity to designate a
Beneficiary or Beneficiaries, and from time to time the Participant may
file with the Plan Administrator a new or revised designation on the
form provided by the Plan Administrator. If a Participant is married,
any designation of a Beneficiary other than the Participant's spouse
must be consented to by the Participant's spouse pursuant to a
Qualified Election.
If a Participant dies without designating a Beneficiary, or if the
Participant is predeceased by all designated Beneficiaries and
contingent Beneficiaries, the Plan Administrator will distribute all
benefits which are payable in the event of the Participant's death in
the following manner and to the first of the following (who are listed
in order of priority) who survive the Participant by at least 30 days:
o All to the Participant's Surviving Spouse;
o Equally among the then living children of the Participant (by
birth or adoption);
o Among the Participant's then living lineal descendants, by
right of representation; or
o The Participant's estate.
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ARTICLE 7
LIMITATIONS ON BENEFITS
7.01 Limitation on Annual Additions
The amount of the Annual Addition which may be allocated under this
Plan to any Participant's Account as of any Allocation Date will not
exceed the Defined Contribution Limit (based upon his Aggregate
Compensation up to such Valuation Date) reduced by the sum of any
allocations of annual additions made to Participant's Accounts under
this Plan as of any preceding Allocation Date within the Limitation
Year.
If the Annual Addition under this Plan on behalf of a Participant is to
be reduced as of any Allocation Date as a result of the next preceding
paragraph, the reduction will be, to the extent required, effected by
first reducing Participant contributions (which increase the annual
addition), then Forfeitures (if any), and then Employer contributions
to be allocated under this Plan on behalf of the Participant as of the
Allocation Date.
Any necessary reduction will be made as follows:
(a) The amount of the reduction consisting of nondeductible
Participant contributions will be paid to the Participant as
soon as administratively feasible.
(b) The amount of the reduction consisting of any other
Participant contributions will be paid to the Participant as
soon as administratively feasible.
(c) The amount of the reduction consisting of Forfeitures will be
allocated and reallocated to other Accounts in accordance with
the Plan formula for allocating Forfeitures to the extent that
such allocations do not cause the additions to any other
Participant's Accounts to exceed the lesser of the Defined
Contribution Limit or any other limitation provided in the
Plan.
(d) The amount of the reduction consisting of Employer
contributions will be allocated and reallocated to other
Accounts in accordance with the Plan formula for Employer
Contributions to the extent that such allocations do not cause
the additions to any other Participant's Accounts to exceed
the lesser of the Defined Contribution Limit or any other
limitation provided in the Plan.
(e) To the extent that the reductions described in paragraph (d)
cannot be allocated to other Participant's Accounts, the
reductions will be allocated to a suspense account as
Forfeitures and held therein until the next succeeding
Allocation Date on which Forfeitures could be applied under
the provisions of the Plan. All amounts held in a suspense
account must be applied as Forfeitures before any additional
contributions, which would constitute annual additions, may be
made to the Plan. If the Plan terminates, the suspense account
will revert to the Employer to the extent it may not be
allocated to any Participant's Accounts.
(f) If a suspense account is in existence at any time during a
Limitation Year pursuant to this Section, it will not
participate in the allocation of the Trust Fund's investment
gains and losses.
7.02 Where Employer Maintains Another Qualified Plan
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(a) Where Employer Maintains Another Qualified Defined
Contribution Plan
If the Employer maintains this Plan and one or more other
qualified defined contribution plans, one or more welfare
benefit funds (as defined in Code Section 419(e)), or one or
more individual medical accounts (as defined in Code Section
415(l)(2)), all of which are referred to in this Article 7 as
"qualified defined contribution plans", the annual additions
allocated under this Plan to any Participant's Accounts will
be limited in accordance with the allocation provisions of
this Section 7.02(a).
The amount of the Annual Additions which may be allocated
under this Plan to any Participant's Accounts as of any
Allocation Date will not exceed the Defined Contribution Limit
(based upon Aggregate Compensation up to the allocation date)
reduced by the sum of any allocations of Annual Additions made
to the Participant's Accounts under this Plan and any other
qualified defined contribution plans maintained by the
Employer as of any earlier Allocation Date within the
Limitation Year.
If an Allocation Date of this Plan coincides with an
Allocation Date of any other plan described in the above
paragraph, the amount of Annual Additions to be allocated on
behalf of a Participant under this Plan as of such date will
be an amount equal to the product of the amount described in
the next preceding paragraph multiplied by a fraction (not to
exceed 1.0), the numerator of which is the amount to be
allocated under this Plan without regard to this Article
during the Limitation Year and the denominator of which is the
amount that would otherwise be allocated on the Allocation
Date under all plans without regard to this Article 7.
If the Annual Addition under this Plan on behalf of a
Participant is to be reduced as of any Allocation Date as a
result of the next preceding two paragraphs, the reduction
will be, to the extent required, effected by first reducing
Participant contributions (which increase the annual
addition), then Forfeitures (if any), and then any Employer
contributions, to be allocated under this Plan on behalf of
the Participant as of the Allocation Date.
If as a result of the first four paragraphs of this Section
7.02 the allocation of ANNUAL Additions is reduced, the
reduction will be treated in the manner described in the third
paragraph of Section 7.01.
(b) Where Employer Maintains a Qualified Defined Benefit Plan
(1) In General
If the Employer maintains (or has ever maintained),
in addition to this Plan, one or more qualified
defined benefit plans, then for any Limitation Year,
the sum of the Defined Benefit Plan Fraction and the
Defined Contribution Plan Fraction will not exceed
1.0. If, in any Limitation Year, the sum of the
Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction for a Participant would
exceed 1.0 without adjustment to the amount of the
annual benefit that can be paid to the Participant
under the defined benefit plan, then the amount of
annual benefit that would otherwise be paid to the
Participant under the defined benefit plan will be
reduced to the extent necessary to reduce the sum of
the Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction for the Participant to
1.0.
(2) Transition Rule under TRA '86
If a plan was in existence on May 6, 1986, the
numerator of the Defined Contribution
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Plan Fraction will be reduced (to not less than zero)
as prescribed by the Secretary of the Treasury by
subtracting the amount required to decrease the sum
of the Defined Contribution Plan Fraction plus the
Defined Benefit Plan Fraction to 1.0. Such amount is
determined (as of the first day of the first
Limitation Year beginning on or after January 1,
1987) as the product of:
(A) The amount by which, without this
adjustment, the sum of the Defined
Contribution Plan Fraction plus the Defined
Benefit Plan Fraction exceeds 1.0,
multiplied by
(B) The denominator of the Defined Contribution
Plan Fraction, as computed through the last
Limitation Year beginning before January 1,
1987, disregarding any changes in the terms
and conditions of the plan after May 5,
1986.
This subparagraph 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.
(3) Transition Rule under TEFRA
In the case of a plan which met the limitation of
Section 415 of the Code for the last Limitation Year
beginning before January 1, 1983, the numerator of
the Defined Contribution Plan Fraction will be
reduced (to not less than zero) as prescribed by the
Secretary of the Treasury by subtracting the amount
required to decrease the sum of the Defined
Contribution Plan Fraction plus the Defined Benefit
Plan Fraction to 1.0. Such amount is determined (as
of the first day of the first Limitation Year
beginning on or after January 1, 1983) as the product
of:
(A) The amount by which, without this
adjustment, the sum of the Defined
Contribution Plan Fraction plus the Defined
Benefit Plan Fraction exceeds 1.0.
multiplied by
(B) The denominator of the Defined Contribution
Plan Fraction, as computed through the last
Limitation Year beginning before January 1,
1983.
7.03 Definitions Applicable to Article 7
(a) Aggregate Compensation
Aggregate Compensation means the total amount of salary,
wages, commissions, bonuses and overtime, paid or otherwise
includable in the gross income of a Participant during the
Limitation Year, but excluding:
(i) Employer contributions to any deferred compensation
plan (to the extent the contributions are not
included in the Participant's gross income for the
taxable year in which contributed) or simplified
employee pension under Code Section 408(k) (to the
extent the contributions are excludable from the
Participant's gross income;
(ii) distributions from any plan of deferred compensation,
whether or not such amounts are includable in the
gross income of the Employees when distributed;
(iii) amounts realized from the exercise of any
nonqualified stock option, or when restricted
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stock becomes freely transferrable or is no longer
subject to a substantial risk of forfeiture;
(iv) amounts realized from the sale, exchange, or other
disposition of stock acquired under a qualified stock
option described in Part II, Subchapter D, Chapter 1
of the Code;
(v) premiums paid by the Employer for group term life
insurance (to the extent the premiums are not
includable in the Participant's gross income);
contributions by the Employer to an annuity under
Code Section 403(b) (to the extent not includable in
the Participant's gross income); and any other
amounts received under any Employer sponsored fringe
benefit plan (to the extent not includable in the
Participant's gross income);
(vi) any contribution for medical benefits, within the
meaning of Code Section 419A(f)(2), after separation
from Service which is otherwise treated as an Annual
Addition; and
(vii) any amount otherwise treated as an Annual Addition
under Code Section 415(l)(1).
For Plan Years beginning prior to JANUARY 1, 1998, Aggregate
Compensation excludes any amounts contributed by the Employer
or any Related Employer on behalf of any Employee pursuant to
a salary reduction agreement which are not includable in the
gross income of the Employee due to Code Section 125,
402(e)(3), 402(h), 403(b), and 402(k).
Notwithstanding the above, for Plan Years beginning on or
after JANUARY 1, 1998, Aggregate Compensation includes any
amounts contributed by the Employer or any Related Employer on
behalf of any Employee pursuant to a salary reduction
agreement which are not includable in the gross income of the
Employee due to Code Section 125, 402(e)(3), 402(h), 402(k) or
403(b).
Aggregate Compensation in excess of the Statutory Compensation
Limit is disregarded.
Aggregate Compensation for any Limitation Year is the
Aggregate Compensation actually paid or includable in gross
income in such year.
(b) Allocation Date
Allocation Date means the date with respect to which all or a
portion of employer contributions, employee contributions or
forfeitures or both are allocated to participant accounts
under a defined contribution plan.
(c) Annual Additions
For Plan Years beginning after December 31, 1986, Annual
Additions are the sum of the following amounts allocated to
any defined contribution plan maintained by the Employer
(including voluntary contributions to any defined benefit plan
maintained by the Employer) on behalf of a Participant for a
Limitation Year:
o All Employee and Employer contributions;
o All reallocated forfeitures;
o 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 the Employer, and amounts
derived from contributions paid or accrued after
December 31,
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1985, in taxable years ending after that date, which
are attributable to post-retirement medical benefits
required by Code Section 401(h)(6) to be allocated to
the separate account of a Key Employee under a
welfare benefit plan (as defined in Code Section
419(e)) maintained by the Employer.
Contributions or forfeitures will be treated as Annual
Additions regardless of whether they constitute Excess
Deferrals, Excess Contributions or Excess Aggregate
Contributions within the meaning of the regulations under Code
Section 401(k) or 401(m) and regardless of whether they are
corrected through distribution or recharacterization. Excess
deferrals distributed in accordance with Treasury Regulation
1.402(g)-1(e)(2) or (3) are not Annual Additions. The Annual
Addition for any Limitation Year beginning before January 1,
1987, will not be recomputed to treat all Employee After-tax
Contributions as Annual Additions.
(d) Annual Benefit
Annual Benefit means a benefit payable annually in the form of
a straight life annuity (with no ancillary benefits) under a
plan to which employees do not contribute and under which no
rollover contributions are made.
(e) Defined Benefit Compensation Limit
The Defined Benefit Compensation Limit is equal to 100% of the
Participant's average Aggregate Compensation for the three
consecutive calendar years (or other twelve consecutive month
periods adopted by the Employer pursuant to a Written
Resolution and applied on a uniform and consistent basis) of
service during which the Participant had the greatest
Aggregate Compensation.
Where the annual benefit is payable to a Participant in a form
other than a straight life annuity or a Qualified Joint and
Survivor Annuity, the Defined Benefit Compensation Limit will
be the Actuarial Equivalent of a straight life annuity
beginning at the same age. No adjustment is required for the
following: pre-retirement disability benefits, pre-retirement
death benefits and post-retirement medical benefits. For
purposes of this paragraph, the interest rate used in
adjusting the Defined Benefit Compensation Limit will be the
greater of (1) 5%, or (2) the post-retirement interest rate
specified in the plan for Actuarial Equivalent purposes.
Where the annual benefit is payable to a Participant who has
fewer than 10 years of service with the Employer or any
Related or Predecessor Employer, the Defined Benefit
Compensation Limit will be multiplied by a fraction, the
numerator of which is the Participant's number of years of
service with the Employer or Related or Predecessor Employer,
and the denominator of which is 10.
With regard to a Participant who has separated from service
with a nonforfeitable right to an Accrued Benefit, the Defined
Benefit Compensation Limit will be adjusted effective January
1 of each Calendar year. For any Limitation Year beginning
after the separation occurs, the Defined Benefit Compensation
Limit will be equal to the Defined Benefit Compensation Limit
which was applicable to the Participant in the Limitation Year
in which he separated from service multiplied by a fraction,
the numerator of which is the Defined Benefit Dollar Limit for
the Limitation Year in which the Defined Benefit Compensation
Limit is being adjusted and the denominator of which is the
Defined Benefit Dollar Limit for the Limitation Year in which
the Participant separated from service.
(f) Defined Benefit Dollar Limit
The Defined Benefit Dollar Limit is equal to $90,000 for
calendar years 1984 through 1987. As
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of January 1, 1988 and as of January 1 of each subsequent
calendar year, the dollar limitation (described in Code
Section 415(b)(1)(A)) as determined by the Secretary of the
Treasury for that calendar year will become effective as the
Defined Benefit Dollar Limit for the calendar year. For
calendar years between 1976 and 1983, the Defined Benefit
Dollar Limit is $75,000 as adjusted by the Secretary of the
Treasury under Code Section 415(d) for that calendar year. The
Defined Benefit Dollar Limit for a calendar year applies to
Limitation Years ending with or within that calendar year.
Where the annual benefit is payable to a Participant in a form
other than a straight life annuity or a Qualified Joint and
Survivor Annuity, the Defined Benefit Dollar Limit will be the
Actuarial Equivalent of a straight life annuity beginning at
the same age. No adjustment is required for the following:
pre-retirement disability benefits, pre-retirement death
benefits, and post-retirement medical benefits. For purposes
of this paragraph, the interest rate used for adjusting the
Defined Benefit Dollar Limit will be the greater of (1) 5%, or
(2) the post-retirement interest rate specified for Actuarial
Equivalent purposes.
Where the annual benefit is payable to a Participant who has
fewer than 10 years of participation in the Plan, the Defined
Benefit Dollar Limit will be multiplied by a fraction, the
numerator of which is the Participant's number of years (or
part thereof) of participation in the Plan, and the
denominator of which is 10. To the extent provided by the
Secretary of the Treasury, this paragraph will be applied to
each change in the benefit structure of the Plan.
For a benefit commencing before a Participant's Social
Security Retirement Age but at or after age 62, the Defined
Benefit Dollar Limit will be adjusted in a manner which is
consistent with the reduction for old-age insurance benefits
commencing before Social Security Retirement Age under the
Social Security Act. The reduction will be 5/9 of 1% for each
of the first 36 months and 5/12 of 1% for each additional
month (up to 24 months) by which benefits commence before the
month of the Participant's Social Security Retirement Age. The
Defined Benefit Dollar Limit for a benefit commencing before
age 62 will be adjusted to the Actuarial Equivalent of the
Defined Benefit Dollar Limit for a benefit commencing at age
62 based on an interest rate equal to the greater of (1) 5%,
or (2) the interest rate specified in the plan for determining
actuarial equivalence for early retirement.
For a benefit commencing after a Participant's Social Security
Retirement Age, the Defined Benefit Dollar Limit will be
adjusted to the actuarial equivalent of the Defined Benefit
Dollar Limit for a benefit commencing at the Participant's
Social Security Retirement Age. For purposes of this
paragraph, the interest rate used for adjusting the Defined
Benefit Dollar Limit will be the lesser of (1) 5%, or (2) the
interest rate specified in the plan for determining actuarial
equivalence for early retirement.
(g) Defined Benefit Limit
The Defined Benefit Limit is the lesser of the Defined Benefit
Dollar Limit or the Defined Benefit Compensation Limit.
(h) Defined Benefit Plan Fraction Denominator
The Defined Benefit Plan Fraction Denominator with respect to
any Participant is the lesser of (1) the product of the
Defined Benefit Dollar Limit multiplied by 1.25, or (2) the
product of the Defined Benefit Compensation Limit multiplied
by 1.4. However, for purposes of determining the Defined
Benefit Plan Fraction Denominator, "years of service with the
Employer or any Related or Predecessor Employer" will be
substituted for "years of participation in the Plan" wherever
it appears in Section 7.03(f).
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(i) Defined Benefit Plan Fraction
The Defined Benefit Plan Fraction is a fraction determined as
of the close of a Limitation Year, the numerator of which is
the Projected Annual Benefit payable to a Participant under
this Plan and the denominator of which is the Defined Benefit
Fraction Denominator. If a Participant has participated in
more than one defined benefit plan maintained by the Employer,
the numerator of the Defined Benefit Plan Fraction is the sum
of the projected annual benefits payable to the Participant
under all of the defined benefit plans, whether or not
terminated.
(j) Defined Contribution Limit
The Defined Contribution Limit for a given Limitation Year is
equal to the lesser of (1) the Defined Contribution
Compensation Limit, which is 25% of Aggregate Compensation
applicable to the Limitation Year, or (2) the Defined
Contribution Dollar Limit, which, for calendar years after
1983 is the greater of $30,000 or one-fourth of the Defined
Benefit Dollar Limit for the Limitation Year, and for calendar
years between 1976 and 1983 is one-third of the Defined
Benefit Dollar Limit. If a short Limitation Year is created
because of an amendment changing the Limitation Year to a
different 12 consecutive month period, the Defined
Contribution Dollar Limit is multiplied by a fraction, the
numerator of which is equal to the number of months in the
short Limitation Year and the denominator of which is 12.
(k) Defined Contribution Plan Fraction
The Defined Contribution Plan Fraction is a fraction
determined as of the close of a Limitation Year, the numerator
of which is the sum of the Annual Additions to the
Participant's Accounts under all defined contribution plans of
the Employer for the current and all prior Limitation Years
and the denominator of which is the sum of the Annual
Additions which would have been made for the Participant for
the current and all prior Limitation Years (for all prior
years of service with the Employer or any predecessor
Employer) if in each Limitation year the Annual Additions
equaled the lesser of (1) the product of the Defined
Contribution Compensation Limit for the Limitation Year
multiplied by 1.4, or (2) the product of the Defined
Contribution Dollar Limit for the Limitation Year multiplied
by 1.25. The aggregate amount in the numerator of this
fraction due to years beginning before January 1, 1976 may not
exceed the aggregate amount in the denominator of this
fraction for all such years.
For purposes of this Section 7.03(k), the Annual Addition for
any Limitation Year beginning before January 1, 1987 will not
be recomputed to treat all Employee After-tax Contributions as
Annual Additions.
(l) Employer
The Employer is the Employer that adopts this Plan together
with all Related Employers. For this purpose, the definition
of Related Employer in Section 1.35 of this Plan is modified
by Code Section 415(h).
(m) Limitation Year
The Limitation Year will be the 12 consecutive month period
which is specified in Article 1 of this Plan and which is
adopted for all qualified plans maintained by the Employer
pursuant to a Written Resolution adopted by the Employer. In
the event of a change in the Limitation Year, the additional
limitations of Treasury Regulation Section 1.415-2(b)(4)(iii)
will also apply.
(n) Projected Annual Benefit
For purposes of this Section, a Participant's Projected Annual
Benefit is equal to the annual benefit to which a Participant
in a defined benefit Plan would be entitled under the terms of
the
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plan based on the following assumptions:
o The Participant will continue employment until
reaching normal retirement age as determined under
the terms of the plan (or current age, if that is
later);
o The Participant's compensation for the Limitation
Year under consideration will remain the same for all
future years;
o All other relevant factors used to determine benefits
under the plan for the Limitation Year under
consideration will remain constant for all future
Limitation Years; and
o The benefits resulting from any Participant
Contributions or Rollover Contributions are
disregarded.
(o) Social Security Retirement Age
Social Security Retirement Age means age 65 for a Participant
born before January 1, 1938; age 66 for a Participant born
after December 31, 1937, but before January 1, 1955; and age
67 for a Participant born after December 31, 1954.
(p) Transition Rule Under TRA '86
If, at the beginning of the first Limitation Year beginning
after December 31, 1986, an Employee was a Participant in a
defined benefit plan of the Employer or any Related Employer
that was in existence on May 6, 1986, the Defined Benefit
Dollar Limit for that Participant is the greater of the
Defined Benefit Dollar Limit described above or the
Participant's Current Accrued Benefit on that date determined
without regard to changes in the terms and conditions of the
Plan or cost-of-living increases occurring after May 5, 1986.
This Section 7.03(p) applies only if all defined benefit plans
maintained by the Employer and all Related Employers,
individually and in the aggregate, satisfied the requirements
of Code Section 415 for all Limitation Years beginning before
January 1, 1987.
(q) Transition Rule Under TEFRA
The Defined Benefit Dollar Limit for a Participant in a
defined benefit plan of the Employer or any Related Employer
that was in existence on July 1, 1982, will not be less than
the protected current accrued benefit, payable annually,
provided under question T-3 of Internal Revenue Service Notice
83-10.
7.04 Effect of Top-Heavy Status
(a) General
Notwithstanding the provisions of Section 7.03, "1.0" will be
substituted for "1.25" wherever it appears in Sections 7.03(h)
and 7.03(k) for any Limitation Year in which the Plan is found
to be Top-Heavy for the Plan Year which coincides with or ends
within such Limitation Year.
(b) Non-application
If the Plan is not determined to be Super Top-Heavy, then for
the Plan Year which coincides with or ends within a Limitation
Year, the following will apply:
(1) Any Non-Key Employee who is a Participant in both
this Plan and a defined benefit plan maintained by
the Employer or a Related Employer will be entitled
to a minimum
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accrued benefit under the defined benefit plan equal
to the greater of the accrued benefit provided under
the defined benefit plan or a monthly benefit in the
form of a straight life annuity (with no ancillary
benefits) commencing at normal retirement date equal
to the Participant's average monthly compensation
(which means the average rate of Aggregate
Compensation during the five consecutive years, as
defined for purposes of determining average monthly
compensation, in which the Participant had the
highest Aggregate Compensation) multiplied by the
lesser of (A) 3% for each year of benefit service
performed while actually participating in the plan
during a Plan Year in which the plan is determined to
be Top-Heavy, or (B) 30%.
A Participant will not be required to be employed on
the last day of a Plan Year in order to be entitled
to the benefit provided by this Section 7.04(b). The
defined benefit plan may not satisfy the requirements
of this Section 7.04(b) through Employer
contributions to Social Security.
(2) Section 7.04(a) will not apply for such Limitation
Year.
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ARTICLE 8
MISCELLANEOUS
8.01 Employment Rights of Parties Not Restricted
The adoption and maintenance of this Plan will not be deemed a contract
between the Employer and any Employee. Nothing in this Plan will give
any Employee or Participant the right to be retained in the employ of
the Employer or to interfere with the right of the Employer to
discharge any Employee or Participant at any time, nor will it give the
Employer the right to require any Employee or Participant to remain in
its employ, or to interfere with any Employee's or Participant's right
to terminate his employment at any time.
8.02 Alienation
(a) General
No person entitled to any benefit under this Plan will have
any right to sell, assign, transfer, hypothecate, encumber,
commute, pledge, anticipate or otherwise dispose of his
interest in the benefit, and any attempt to do so will be
void. No benefit under this Plan will be subject to any legal
process, levy, execution, attachment or garnishment for the
payment of any claim against such person.
(b) Exceptions
Section 8.02(a) will not apply to the extent a Participant or
Beneficiary is indebted to the Plan under the provisions of
the Plan. At the time a distribution is to be made to or for a
Participant's or Beneficiary's benefit, the portion of the
amount distributed which equals the indebtedness will be
withheld by the Trustee to apply against or discharge the
indebtedness. Before making a payment, however, the
Participant or Beneficiary must be given written notice by the
Plan Administrator that the indebtedness is to be so paid in
whole or part from his Vested Accrued Benefit. If the
Participant or Beneficiary does not agree that the
indebtedness is a valid claim against his Vested Accrued
Benefit, he will be entitled to a review of the validity of
the claim in accordance with procedures established by the
Plan Administrator.
Section 8.02(a) will not apply to a qualified domestic
relations order (QDRO) as defined in Code Section 414(p), and
those other domestic relations orders permitted to be so
treated by the Plan Administrator under the provisions of the
Retirement Equity Act of 1984. The Plan Administrator will
establish a written procedure to determine the qualified
status of domestic relations orders and to administer
distributions under such qualified orders. Further, to the
extent provided under a QDRO, a former spouse of a Participant
will be treated as the spouse or Surviving Spouse for all
purposes under the Plan. Where, however, because of a QDRO,
more than one individual is to be treated as a Surviving
Spouse, the total amount to be paid in the form of a Qualified
Survivor Annuity or the survivor portion of a Qualified Joint
and Survivor Annuity may not exceed the amount that would be
paid if there were only one Surviving Spouse. All rights and
benefits, including elections, provided to a Participant under
this Plan will be subject to the rights afforded to any
alternate payee as such term is defined in Code Section
414(p).
This Plan specifically permits distribution to an alternate
payee under a QDRO (without regard to whether the Participant
has attained his or her earliest retirement age as that term
is defined under Code Section 414(p)) in the same manner that
is provided for a Vested Terminated Participant.
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8.03 Qualification of Plan
The Employer will have the sole responsibility for obtaining and
retaining qualification of the Plan under the Code with respect to the
Employer's individual circumstances.
8.04 Construction
To the extent not preempted by ERISA, this Plan will be construed
according to the laws of the state in which the Employer's principal
place of business is located. Words used in the singular will include
the plural, the masculine gender will include the feminine, and vice
versa, whenever appropriate.
8.05 Named Fiduciaries
(a) Allocation of Functions
The authority to control and manage the operation and
administration of the Plan and Trust created by this
instrument will be allocated between the Plan Sponsor, the
Trustee, and the Plan Administrator, all of whom are
designated as Named Fiduciaries with respect to the Plan and
Trust as provided for by Section 402(a)(2) of ERISA. The Plan
Sponsor reserves the right to allocate the various
responsibilities for the present execution of the functions of
the Plan, other than the Trustee's responsibilities, among its
Named Fiduciaries. Any person or group of persons may serve in
more than one fiduciary capacity with regard to the Plan.
(b) Responsibilities of the Plan Sponsor
The Plan Sponsor, in its capacity as a Named Fiduciary, will
have only the following authority and responsibility:
o To appoint or remove the Plan Administrator and
furnish the Trustee with certified copies of any
resolutions of the Plan Sponsor with regard thereto;
o To appoint and remove the Trustee;
o To appoint a successor Trustee or additional
Trustees;
o To communicate information to the Plan Administrator
and the Trustee as needed for the proper performance
of the duties of each;
o To appoint an investment manager (or to refrain from
such appointment), to monitor the performance of the
investment manager so appointed, and to terminate
such appointment (more than one investment manger may
be appointed and in office at any time); and
o To establish and communicate to the Trustee a funding
policy for the Plan.
(c) Limitation on Obligations of Named Fiduciaries
No Named Fiduciary will have authority or responsibility to
deal with matters other than as delegated to it under this
Plan or by operation of law. A Named Fiduciary will not in any
event be liable for breach of fiduciary responsibility or
obligation by another fiduciary (including Named Fiduciaries)
if the responsibility or authority of the act or omission
deemed to be a breach was not within the scope of the Named
Fiduciary's authority or delegated responsibility.
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(d) Standard of Care and Skill
The duties of each fiduciary will be performed with the care,
skill, prudence and diligence under the circumstances then
prevailing that a prudent person acting in a like capacity and
familiar with such matters would use in the conduct of an
enterprise of like character and with like objectives.
8.06 Status of Insurer
The term Insurer refers to any legal reserve life insurance company
licensed to do business in the state within which the Employer
maintains its principal office. The Insurer will file such returns,
keep such records, make such reports and supply such information as
required by applicable law or regulation.
8.07 Adoption and Withdrawal by Other Organizations
(a) Procedure for Adoption
Subject to the provisions of this Section 8.07, any
organization now in existence or hereafter formed or acquired,
which is not already a Participating Employer under this Plan
and which is otherwise legally eligible may, in the future,
with the consent and approval of the Plan Sponsor, by formal
Written Resolution (referred to in this Section as an Adoption
Resolution), adopt the Plan and Trust hereby created for all
or any classification of persons in its employment and
thereby, from and after the specified effective date, become a
Participating Employer under this Plan. Such consent will be
effected by and evidenced by a formal Written Resolution of
the Plan Sponsor. The Adoption Resolution may contain such
specific changes and variations in Plan terms and provisions
applicable to the adopting Participating Employer and its
Employees as may be acceptable to the Plan Sponsor and the
Trustee. However, the sole, exclusive right of any other
amendment of whatever kind or extent to the Plan is reserved
to the Plan Sponsor. The Adoption Resolution will become, as
to the adopting organization and its Employees, a part of this
Plan as then amended or thereafter amended. It will not be
necessary for the adopting organization to sign or execute the
original or then amended Plan and Trust Agreement or any
future amendment to the Plan and Trust Agreement. The
effective date of the Plan for the adopting organization will
be that stated in the Adoption Resolution and from and after
such effective date the adopting organization will assume all
the rights, obligations and liabilities as a Participating
Employer under this Plan. The administrative powers of and
control by the Plan Sponsor as provided in the Plan, including
the sole right of amendment or termination of the Plan, of
appointment and removal of the Plan Administrator and the
Trustee, and of appointment and removal of an investment
manager will not be diminished by reason of the participation
of the adopting organization in the Plan.
(b) Withdrawal
Any Participating Employer may withdraw from the Plan at any
time, without affecting the Plan Sponsor or other
Participating Employers not withdrawing, by complying with the
provisions of the Plan. A withdrawing Participating Employer
may arrange for the continuation by itself or its successor of
this Plan in separate forms for its own employees, with such
amendments, if any, as it may deem proper, and may arrange for
continuation of the Plan by merger with an existing plan and
transfer of plan assets. The Plan Sponsor may, it its absolute
discretion, terminate a Participating Employer's participation
at any time when in its judgment the Participating Employer
fails or refuses to discharge its obligations under the Plan.
(c) Adoption Contingent Upon Initial and Continued Qualifications
The adoption of this Plan by an organization as provided is
hereby made contingent and subject to the condition precedent
that said adopting organization meets all the statutory
requirements for qualified plans, including, but not limited
to, Sections 401(a) and 501(a) of the Internal Revenue
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Code for its Employees. If the Plan or the Trust, in its
operation, becomes disqualified, for any reason, as to the
adopting organization and its Employees, the portion of the
Plan assets allocable to them will be segregated as soon as is
administratively feasible, pending either the prompt (1)
requalification of the Plan as to the organization and its
employees to the satisfaction of the Internal Revenue Service
so as not to affect the continued qualified status thereof as
to other Employers, (2) withdrawal of the organization from
this Plan and a continuation by itself or its successor of its
plan separately from this Plan, or by merger with another
existing plan, with a transfer of its said segregated portion
of Plan assets, or (3) termination of the Plan as to itself
and its Employees.
8.08 Employer Contributions
Employer contributions made to the Plan and Trust are made and will be
held for the sole purpose of providing benefits to Participants and
their Beneficiaries.
In no event will any contribution made by the Employer to the Plan and
Trust or income therefrom revert to the Employer except as provided in
Section 7.01(e) or as provided below.
(a) Any contribution made to the Plan and Trust by the Employer
because of a mistake of fact may be returned to the Employer
within one year of such contribution. The amount of the
mistaken contribution is equal to the excess of (a) the amount
contributed over (b) the amount that would have been
contributed had there not occurred a mistake of fact. Earnings
attributable to mistaken contributions may not be returned to
the Employer, but losses attributable thereto shall reduce the
amount to be returned.
(b) Notwithstanding any other provision of the Plan and Trust, if
the Internal Revenue Service determines initially that the
Plan, as adopted by the Employer, does not qualify under
applicable sections of the Code and applicable Treasury
Department Regulations, and the Employer does not wish to
amend this Plan and Trust so that it does qualify, the value
of all assets will be distributed by the Trustee to the
Employer within one year after the date such initial
qualification is denied. Thereafter, the Employer's
participation in this Plan and Trust will be considered
rescinded and of no force or effect.
(c) Any contribution made by the Employer is conditioned on the
deductibility of such contribution and may be refunded to the
Employer, to the extent the contribution is determined not to
be deductible, within one year after such determination is
made. Earnings attributable to excess contributions may not be
returned to the Employer, but losses attributable thereto
shall reduce the amount to be returned.
8.09 Employees in Qualified Military Service
Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credits with respect to qualified
military service will be provided in accordance with Section 414(u) of
the Internal Revenue Code.
8.10 Unclaimed Benefits
In the event of the failure of a Participant or Beneficiary to claim
benefits payable under the Plan, and the inability of the Plan
Administrator to find the Participant or Beneficiary after a good faith
effort to do so, the benefits shall be allocated in the same manner as
Forfeitures at the end of the applicable Plan Year. This provision
shall be administered in a uniform and non-discriminatory manner. If a
claim is later made by the Participant or his Beneficiary, the
benefits, together with estimated earnings, will be reinstated from
subsequent forfeitures, and to the extent insufficient to make such
restitution, from Employer contributions.
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ARTICLE 9
ADMINISTRATION
9.01 Plan Administrator
The Plan Administrator will have the responsibility for the general
supervision and administration of the Plan and will be a fiduciary of
the Plan. The Employer may, by Written Resolution, appoint one or more
individuals to serve as Plan Administrator. If the Employer does not
appoint an individual or individuals as Plan Administrator, the
Employer will function as Plan Administrator. The Employer may at any
time, with or without cause, remove an individual as Plan Administrator
or substitute another individual therefor.
9.02 Powers and Duties of the Plan Administrator
The Plan Administrator will be charged with and will have delegated to
it the power, duty, authority and discretion to interpret and construe
the provisions of this Plan, to determine its meaning and intent and to
make application thereof to the facts of any individual case; to
determine in its discretion the rights and benefits of Participants or
the eligibility of Employees; to give necessary instructions and
directions to the Trustee and the Insurer as herein provided or as may
be requested by the Trustee and the Insurer from time to time; to
resolve all questions of fact relating to any of the foregoing; and to
generally direct the administration of the Plan according to its terms.
All decisions of the Plan Administrator in matters properly coming
before it according to the terms of this Plan, and all actions taken by
the Plan Administrator in the proper exercise of its administrative
powers, duties and responsibilities, will be final and binding upon all
Employees, Participants and Beneficiaries and upon any person having or
claiming any rights or interest in this Plan. The Employer and the Plan
Administrator will make and receive any reports and information, and
retain any records necessary or appropriate to the administration of
this Plan or to the performance of duties hereunder or to satisfy any
requirements imposed by law. In the performance of its duties, the Plan
Administrator will be entitled to rely on information duly furnished by
any Employee, Participant or Beneficiary or by the Employer or Trustee.
Notwithstanding the foregoing, if the Plan Administrator adopts a loan
policy, pursuant to Section 11.16, the loan policy must be a written
document and must include (A) the identity of the person or positions
authorized to administer the participant loan program; (B) a procedure
for applying for the loan; (C) the criteria for approving or denying a
loan; (D) the limitations, if any, on the types and amounts of loans
available; (E) the procedure for determining a reasonable rate of
interest; (F) the types of collateral which may secure the loan; and
(G) the events constituting default and the steps the Plan will take to
preserve plan assets in the event of default. This Section specifically
incorporates any written loan policy adopted by the Plan Administrator
as part of the Employer's Plan.
9.03 Actions of the Plan Administrator
The Plan Administrator may adopt such rules as it deems necessary,
desirable or appropriate with respect to the conduct of its affairs and
the administration of the Plan. Whenever any action to be taken in
accordance with the terms of the Plan requires the consent or approval
of the Plan Administrator, or whenever an interpretation is to be made
of the terms of the Plan, the Plan Administrator will act in a uniform
and non-discriminatory manner, treating all Employees and Participants
in similar circumstances in a like manner. If the Plan Administrator is
a group of individuals, all of its decisions will be made by a majority
vote. The Plan Administrator will have the authority to employ one or
more persons to render advice or services with regard to the
responsibilities of the Plan Administrator, including but not limited
to attorneys, actuaries, and accountants. Any persons employed to
render advice or services will have no fiduciary responsibility for any
ministerial functions performed with respect to this Plan.
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9.04 Reliance on Plan Administrator and Employer
Until the Employer gives notice to the contrary, the Trustee and any
persons employed to render advice or services will be entitled to rely
on the designation of Plan Administrator that has been furnished to
them. In addition, the Trustee and any persons employed to render
advice or services will be fully protected in acting upon the written
directions and instructions of the Plan Administrator made in
accordance with the terms of this Plan. If the Plan Administrator is a
group of individuals, unless otherwise specified, any one of such
individuals will be authorized to sign documents on behalf of the Plan
Administrator and such authorized signatures will be recognized by all
person dealing with the Plan Administrator.
The Trustee and any persons employed to render advice or services may
take cognizance of any rules established by the Plan Administrator and
rely upon them until notified to the contrary. The Trustee and any
persons employed to render advice or services will be fully protected
in taking any action upon any paper or document believed to be genuine
and to have been properly signed and presented by the Plan
Administrator, Employer or any agent of the Plan Administrator acting
on behalf of the Plan Administrator.
9.05 Reports to Participants
The Plan Administrator will report in writing to a Participant his
Accrued Benefit under the Plan and the Vested Percentage of such
benefit when the Participant terminates his employment or requests such
a report in writing from the Plan Administrator. To the extent required
by law or regulation, the Plan Administrator will annually furnish to
each Participant, and to each Beneficiary receiving benefits, a report
which fairly summarizes the Plan's most recent report.
9.06 Bond
The Plan Administrator and other fiduciaries of the Plan will be bonded
to the extent required by ERISA or other applicable law. No additional
bond or other security for the faithful performance of any duties under
this Plan will be required.
9.07 Compensation of Plan Administrator
The Compensation of the Plan Administrator will be left to the
discretion of the Plan Sponsor; no person who is receiving full pay
from the Employer will receive compensation for services as Plan
Administrator. All reasonable and necessary expenses incurred by the
Plan Administrator in supervising and administering the Plan will be
paid from the Plan assets by the Trustee at the direction of the Plan
Administrator to the extent not paid by the Plan Sponsor.
9.08 Claims Procedure
The Plan Administrator will make all determinations as to the rights of
any Employee, Participant, Beneficiary or other person under the terms
of this Plan. Any Employee, Participant or Beneficiary, or person
claiming under them, may make claim for benefit under this Plan by
filing written notice with the Plan Administrator setting forth the
substance of the claim. If a claim is wholly or partially denied, the
claimant will have the opportunity to appeal the denial upon filing
with the Plan Administrator a written request for review within 60 days
after receipt of notice of denial. In making an appeal the claimant may
examine pertinent Plan documents and may submit issues and comments in
writing. Denial of a claim or a decision on review will be made in
writing by the Plan Administrator delivered to the claimant within 60
days after receipt of the claim or request for review, unless special
circumstances require an extension of time for processing the claim or
review, in which event the Plan Administrator's decision must be made
as soon as possible thereafter but not beyond an additional 60 days. If
no action on an initial claim is taken within 120 days, the claims will
be deemed denied for purposes of permitting the claimant to proceed to
the review stage. The denial of a claim or the decision on review will
specify the reasons for the denial or decision and will make reference
to the pertinent Plan provisions upon which the denial or decision is
based. The denial of a claim will also include a description of any
additional material or
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information necessary for the claimant to perfect the claim and an
explanation of the claim review procedure herein described. The Plan
Administrator will serve as an agent for service of legal process with
respect to the Plan unless the Employer, through written resolution,
appoints another agent.
If a Participant or Beneficiary is entitled to a distribution from the
Plan, the Participant or Beneficiary will be responsible for providing
the Plan Administrator with his current address. If the Plan
Administrator notifies the Participant or Beneficiary by registered
mail (return receipt requested) at his last known address that he is
entitled to a distribution and also notifies him of the provisions of
this paragraph, and the Participant or Beneficiary fails to claim his
benefits under the Plan or provide his current address to the Plan
Administrator within one year after such notification, the
distributable amount will be forfeited and used to reduce the cost of
the Plan. If the Participant or Beneficiary is subsequently located,
such benefit will be restored.
9.09 Liability of Fiduciaries
Except for a breach of fiduciary responsibility due to gross negligence
or willful misconduct, the Plan Administrator will not incur any
individual liability for any decision, act, or failure to act
hereunder. The Plan Administrator may engage agents to assist it and
may engage legal counsel who may be counsel for the Employer. The Plan
Administrator will not be responsible for any action taken or omitted
to be taken on the advice of counsel.
If there is more than one person serving as a fiduciary in any capacity
(for example, co-Trustees), each will use reasonable care to prevent
the other or others from committing a breach of this Plan. Nothing
contained in this Section will preclude any agreement allocating
specific responsibilities or obligations among the co-fiduciaries
provided that the agreement does not violate any of the terms and
provisions of this Plan. In those instances where any duties have been
allocated between co-fiduciaries, a fiduciary will not be liable for
any loss resulting to the Plan arising from any act or omission on the
part of another co-fiduciary to whom responsibilities or obligations
have been allocated except under the following circumstances:
o If he participates knowingly in, or knowingly undertakes to
conceal, an act or omission of a co-fiduciary knowing the act
or omission is a breach, or
o If by his failure to comply with his specific responsibilities
which give rise to his status as a fiduciary, he has enabled
the other fiduciary to commit a breach; or
o If he has knowledge of a breach by a co-fiduciary, unless he
makes reasonable efforts under the circumstances to remedy the
breach.
9.10 Expenses of Administration
The Employer does not and will not guarantee the Plan assets against
loss. The Employer may in its sole discretion, but will not be
obligated to, pay the ordinary expenses of establishing the Plan,
including the fees of consultants, accountants and attorneys in
connection therewith. The Employer may, in its sole discretion (but
will not be obligated to), pay other costs and expenses of
administering the Plan, the taxes imposed upon the Plan, if any, and
the fees, charges or commissions with respect to the purchase and sale
of Plan assets. Unless paid by the Employer, such costs and expenses,
taxes (if any), and fees, charges and commissions will be a charge upon
Plan assets and deducted by the Trustee.
9.11 Distribution Authority
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If any person entitled to receive payment under this Plan is a minor,
declared incompetent or is under other legal disability, the Plan
Administrator may, in its sole discretion, direct the Trustee to:
o Distribute directly to the person entitled to the payment;
o Distribute to the legal guardian or, if none, to a parent of
the person entitled to payment or to a responsible adult with
whom the person entitled to payment maintains his residence;
o Distribute to a custodian for the person entitled to payment
under the Uniform Gifts to Minors Act if permitted by the laws
of the state in which the person entitled to payment resides;
or
o Withhold distribution of the amount payable until a court of
competent jurisdiction determines the rights of the parties
thereto or appoints a guardian of the estate of the person
entitled to payment.
If there is any dispute, controversy or disagreement between any
Beneficiary or person and any other person as to who is entitled to
receive the benefits payable under this Plan, or if the Plan
Administrator is uncertain as to who is entitled to receive benefits,
or if the Plan Administrator is unable to locate the person who is
entitled to benefits, the Plan Administrator may with acquittance
interplead the funds into a court of competent jurisdiction in the
judicial district in which the Employer maintains its principal place
of business and, upon depositing the funds with the clerk of the court,
be released from any further responsibility for the payment of the
benefits. If it is necessary for the Plan Administrator to retain legal
counsel or incur any expense in determining who is entitled to receive
the benefits, whether or not it is necessary to institute court action,
the Plan Administrator will be entitled to reimbursement from the
benefits for the amount of its reasonable costs, expenses and
attorneys' fees incurred.
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ARTICLE 10
AMENDMENT OR TERMINATION OF PLAN
10.01 Right of Plan Sponsor to Amend or Terminate
The Plan Sponsor reserves the right to alter, amend, revoke or
terminate this Plan. No amendment will deprive any Participant or
Beneficiary of any vested right nor will it reduce the present value
(determined upon an actuarial equivalent basis) of any Accrued Benefit
to which he is then entitled with respect to Employer contributions
previously made, except as may be required to maintain the Plan as a
qualified plan under the Code. No amendment will change the duties or
responsibilities of the Trustee without its express written consent
thereto.
A plan amendment which has the effect of (a) eliminating or reducing an
early retirement benefit or a retirement-type subsidy, or (b)
eliminating an optional benefit form, will, with respect to benefits
attributable to service before the amendment be treated as reducing
Accrued Benefits. In the case of a retirement-type subsidy, the
preceding sentence will apply only with respect to a Participant who
satisfies (either before or after the amendment) the preamendment
conditions for the subsidy. In general, a retirement-type subsidy is a
subsidy that continues after retirement but does not include a
disability retirement benefit, a medical benefit, a social security
supplement, a pre-retirement death benefit, or a plant shutdown benefit
(that does not continue after retirement).
A minimum Accrued Benefit value will apply if this Plan is or becomes a
successor to a profit sharing plan, a defined contribution pension
plan, a target benefit plan, or a defined benefit pension plan which
was fully insured, or any plan under which the accrued benefit of a
Participant was determined as a lump sum or account balance. The
actuarial equivalent value of a Participant's Accrued Benefit will not
be less than the actuarial equivalent value of his Accrued Benefit on
the Effective Date of the Plan.
10.02 Allocation of Assets Upon Termination of Plan
If this Plan is revoked or terminated (in whole or in part) or if
contributions are completely discontinued, the Accounts of all affected
Participants will become non-forfeitable. The Employer will then
arrange for allocation of all assets among Participants so affected by
the total or partial termination in accordance with the requirements of
all applicable law and the regulations and requirements of the Internal
Revenue Service. All allocated amounts will be retained in the Plan to
the credit of the individual Participants until distribution as
directed by the Employer. Distribution to Participants may be in the
form of cash or other Plan assets or partly in each.
10.03 Exclusive Benefit
At no time will any part of the principal or income of the Plan assets
be used or diverted for purposes other than the exclusive benefit of
Participants in the Plan and their Beneficiaries, nor may any portion
of the Plan assets revert to the Employer except as provided in
Sections 7.01(e) and 8.08.
10.04 Failure to Qualify
Notwithstanding any of the foregoing provisions, if this Plan, upon
adoption by the Employer, is submitted to the Internal Revenue Service
which then determines that the Plan as initially adopted by the
Employer is not a qualified plan under the Code, the Employer may elect
to terminate this Plan by giving written notice thereof. Such
termination will have the same effect as if the Plan were never
adopted, all policies and contracts will be cancelled, and all
contributions, to the extent recoverable from the Trustee, will be
returned to their source. If any amendment to this Plan is submitted to
the Internal Revenue Service within the period allowed under Code
Section 401(b) which then determines that the Plan as amended is not a
qualified plan under the Code, the Employer may cancel or modify any or
all provisions of the amendment retroactive to the effective date of
the amendment in order to maintain the qualified
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status of the Plan, whereupon written notice thereof will be furnished
to all affected Employees, Participants and Beneficiaries.
10.05 Mergers, Consolidations or Transfers of Plan Assets
In the event this Plan is merged or consolidated with another plan
which is qualified under Code Sections 401(a) (and 501(a) if
applicable), or in the event of a transfer of the assets or liabilities
of this Plan to another plan which is qualified under Code Sections
401(a) (and 501(a) if applicable), the benefit which each Participant
would be entitled to receive under the successor plan or other plan if
it were terminated immediately after the merger, consolidation or
transfer will be equal to or greater than the benefit which the
Participant would have received immediately before the merger,
consolidation or transfer if this Plan had then terminated.
Any transfer of assets and/or liabilities to (or from) this Plan from
(or to) another plan qualified under Code Sections 401(a) (and 501(a)
if applicable) will be evidenced by a Written Resolution by the Plan
Sponsor of each affected plan which specifically authorizes such
transfer of assets and/or liabilities.
Unless a transfer of assets to this Plan is an Elective Transfer, the
Plan will preserve all Code Section 411(d)(6) protected benefits with
respect to those transferred assets, in the manner described in Section
10.01. A transfer is an Elective Transfer if: (a) the transfer
satisfies this Section 10.05; (b) the transfer is voluntary, under a
fully informed election by the Participant; (c) the Participant has an
alternative that retains his or her Code Section 411(d)(6) protected
benefits, including an option to leave the benefit in the transferor
plan, if that plan is not terminating; (d) the transfer satisfies the
applicable spousal consent requirements of the Code; (e) the transferor
plan satisfies the joint and survivor notice requirements of the Code,
if the Participant's transferred benefit is subject to those
requirements; (f) the Participant has a right to immediate distribution
from the transferor plan, in lieu of the Elective Transfer; (g) the
transferred benefit is at least the greater of the single sum
distribution provided by the transferor plan for which the Participant
is eligible or the present value of the Participant's Accrued Benefit
under the transferor plan payable at that plan's normal retirement age;
(h) the Participant has a one hundred percent (100%) Nonforfeitable
interest in the transferred benefit; and (i) the transfer otherwise
satisfies applicable Treasury regulations. An Elective Transfer may
occur between qualified plans of any type.
If the Plan receives a direct transfer, by merger or otherwise, of
Elective Contributions, or amounts treated as Elective Contributions,
under a Plan with a Code Section 401(k) arrangement, the distribution
restrictions of Code Sections 401(k)(2) and 401(k)(10) continue to
apply to those transferred Elective Contributions.
10.06 Effect of Plan Amendment on Vesting Schedule
No amendment to the Vesting Schedule will deprive a Participant of his
nonforfeitable right to his Vested Accrued Benefit as of the date of
the amendment. Further, if the Vesting Schedule of the Plan is amended,
or if the Plan is amended in any way that directly or indirectly
affects the computation of a Participant's non-forfeitable percentage,
each Participant with at least 3 Years of Vesting Service as of the
last day of the election period described below may elect, within a
reasonable period after the adoption of the amendment, to have his
Vested Percentage computed under the Plan without regard to such
amendment. The period during which such election may be made will
commence with the date the amendment is adopted and will end 60 days
after the latest of:
(a) the date the amendment is adopted;
(b) the date the amendment becomes effective; or
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(c) the date the Participant is issued written notice of the
amendment by the Employer.
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ARTICLE 11
TRUSTEE AND TRUST FUND
11.01 Acceptance of Trust
The Trustee, by signing this Agreement, accepts this Trust and agrees
to perform the duties of the Trustee in accordance with the terms and
conditions set forth herein.
11.02 Trust Fund
(a) Purpose and Nature
The Trustee will establish and maintain a Trust Fund for
purposes of providing a means of accumulating the assets
necessary to provide the benefits which become payable under
the Plan. The Trustee will receive, hold and invest all
contributions made by the Employer, any Participating
Employers, and the Participants, including the investment
earnings thereon. The Trust Fund arising from such
contributions and earnings will consist of all assets held by
the Trustee under the Plan and Trust. All benefits payable
under the Plan will be paid by the Trustee from the Trust
Fund.
Any person having any claim under the Plan will look solely to
the assets of the Trust Fund for satisfaction. In no event
will the Plan Administrator, the Employer, any Employees, any
officer of the Employer or any agents of the Employer or the
Plan Administrator be liable in their individual capacities to
any person whomsoever, under the provisions of this Plan and
Trust, except as provided by law.
The Trust Fund will be used and applied only in accordance
with the provisions of the Plan and Trust, to provide the
benefits thereof, and no part of the corpus or income of the
Trust Fund will be used for, or diverted to, purposes other
than for the exclusive benefit of the Participants or their
Beneficiaries entitled to benefits under the Plan, except to
the extent specifically provided elsewhere herein.
(b) Investments
The Trustee will invest the Trust Fund in accordance with the
investment policy for the Trust Fund considering the fiduciary
requirements of law, the objectives of the Plan, and the
liquidity needs of the Plan.
(c) Operation of Trust Fund
The Trust Fund will be maintained in accordance with the
accounting requirements of the Plan. No Participant will have
any right to any specific asset or any specific portion of the
Trust Fund prior to distribution of benefits. Withdrawals from
the Trust Fund will be made to provide benefits to
Participants and Beneficiaries in the amounts specified by the
Plan, and to pay expenses authorized by the Plan
Administrator.
(d) Plan Sponsor Direction of Investment
The Plan Sponsor will have the right to direct the Trustee
with respect to the investment and reinvestment of assets
comprising the Trust Fund. The Trustee and the Plan Sponsor
(or the Plan Administrator or an Investment Committee
appointed by the Plan Sponsor) will execute a letter of
agreement as a part of this Plan containing such conditions,
limitations and other provisions they deem appropriate before
the Trustee will follow any Plan Sponsor direction with
respect to the investment or reinvestment of any part of the
Trust Fund.
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(e) Combined Trust Fund for Collective Investment Purposes
At the Plan Sponsor's direction, the Trustee, for collective
investment purposes, may combine into a single fund the Trust
created under this Plan with the Trust created under any other
qualified retirement plan maintained by the Plan Sponsor. The
Plan Sponsor will ensure that records of the combined fund are
maintained in such a manner as to properly reflect each
Participant's Accrued Benefit under the Plan(s) in which he is
a Participant.
11.03 Receipt of Contributions
The Trustee will be accountable to the Employer for the funds
contributed to it, but will have no duty to see that the contributions
received comply with the provisions of the Plan. The Trustee will not
be obligated to collect any contributions from the Employer or the
Participants.
11.04 Powers of the Trustee
The Plan Sponsor designates the Trustee to administer the Trust as a
nondiscretionary Trustee. The Trustee will not have any discretion or
authority regarding investment of the Trust Fund, but must act solely
as a directed trustee of the funds contributed to it. Subject to the
provisions and limitations contained elsewhere in this Plan, the
Trustee is authorized and empowered, but not by way of limitation, with
the following powers, rights and duties:
(a) To invest any part or all of the Trust Fund in any common or
preferred stocks, open-end or closed-end mutual funds, United
States retirement plan bonds, corporate bonds, debentures,
convertible debentures, commercial paper, U.S. Treasury bills,
book entry deposits with the United States Federal Reserve
Bank or System, Master Notes or similar arrangements sponsored
by the Trustee or any other financial institution as permitted
by law, improved or unimproved real estate situated in the
United States, mortgages, notes or other property of any kind,
real or personal, as a prudent man would so invest under like
circumstances with due regard for the purposes of this Plan;
(b) To maintain any part of the assets of the Trust Fund in cash,
or in demand or short-term time deposits bearing a reasonable
rate of interest (including demand or short-term time deposits
of or with the Trustee), or in a short-term investment fund or
in other cash equivalents having ready marketability,
including, but not limited to, U.S. Treasury Bills, commercial
paper, certificates of deposit (including such certificates of
deposit of or with the Trustee), and similar types of
short-term securities, as may be deemed necessary by the
Trustee in its sole discretion;
(c) To manage, sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair, insure,
lease for any term even though commencing in the future or
extending beyond the term of the Trust, and otherwise deal
with all property, real or personal, in such manner, for such
considerations and on such terms and conditions as the Trustee
will decide;
(d) To credit and distribute the Trust as directed by the Plan
Administrator or any agent of the Plan Administrator. The
Trustee will not be obliged to inquire as to whether any payee
or distributes is entitled to any payment or whether the
distribution is proper or within the terms of the Plan, or as
to the manner of making any payment or distribution. The
Trustee will be accountable only to the Plan Administrator for
any payment or distribution made by it in good faith on the
order or direction of the Plan Administrator or any agent of
the Plan Administrator;
(e) To borrow money, assume indebtedness, extend mortgages and
encumber by mortgage or pledge;
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(f) To compromise, contest, arbitrate, or abandon claims and
demands, in its discretion;
(g) To have with respect to the Trust all of the rights of an
individual owner, including the power to give proxies, to
participate in any voting trusts, mergers, consolidations or
liquidations, and to exercise or sell stock subscriptions or
conversion rights;
(h) To hold any securities or other property in the name of the
Trustee or its nominee, or in another form as it may deem
best, with or without disclosing the trust relationship;
(i) To perform any and all other acts in its judgment necessary or
appropriate for the proper and advantageous management,
investment and distribution of the Trust;
(j) To retain any funds or property subject to any dispute without
liability for the payment of interest, and to decline to make
payment or delivery of the funds or property until final
adjudication is made by a court of competent jurisdiction;
(k) To file all tax forms or returns required of the Trustee;
(l) To begin, maintain or defend any litigation necessary in
connection with the administration of the Plan, except that
the Trustee will not be obligated to or required to do so
unless indemnified to its satisfaction;
(m) To keep any or all of the Trust property at any place or
places within the United States or abroad, or with a
depository or custodian at such place or places; provided,
however, that the Trustee may not maintain the indicia of
ownership of any assets of the Plan outside the jurisdiction
of the District Courts of the United States, except as may be
expressly authorized in U.S. Treasury or U.S. Department of
Labor regulations; and
(n) To acquire or hold qualifying employer securities, defined in
ERISA Section 407(d)(5), or qualifying employer real property,
defined in ERISA Section 407(d)(4), of an Employer not to
exceed a stated percentage, if any, of the Trust Fund and such
additional authority as enumerated above under the description
of the Trustee's authority, to the extent necessary and
convenient to carry out the duties of the Trustee.
11.05 Investment in Common or Collective Trust Funds
Notwithstanding the provisions of Section 11.04, the Plan Sponsor
specifically authorizes the Trustee to invest all or any portion of the
assets comprising the Trust Fund in any common or collective trust fund
which at the time of the investment provides for the pooling of the
assets of plans qualified under Code Section 401(a). The authorization
applies only if such common or collective trust fund: (a) is exempt
from taxation under Code Section 584 or 501(a); (b) if exempt under
Code Section 501(a), expressly limits participation to pension and
profit sharing trusts which are exempt under Code Section 501(a) by
reason of qualifying under Code Section 401(a); (c) prohibits that part
of its corpus or income which equitably belongs to any participating
trust from being used for or diverted to any purposes other than for
the exclusive benefit of the Employees or their Beneficiaries who are
entitled to benefits under such participating trust; (d) prohibits
assignment by participating trust of any part of its equity or interest
in the group trust; and (e) the sponsor of the group trust created or
organized the group trust in the United States and maintains the group
trust at all times as a domestic trust in the United States. The
provisions of the common or collective trust fund agreement, as amended
by the Trustee from time to time, are by this reference incorporated
within this Plan and Trust. The provisions of the common or collective
trust fund will govern any investment of Plan assets in that fund. This
provision constitutes the express permission required by Section
408(b)(8) of ERISA.
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11.06 Investment in Insurance Company Contracts
The Trustee may invest any portion of the Trust Fund in a deposit
administration, guaranteed investment or similar type of investment
contract (hereinafter referred to as Contract); provided, however, that
no such Contract may provide for an optional form of benefit which
would not be provided for under the provisions hereof. The Trustee will
be the complete and absolute owner of Contracts held in the Trust Fund.
The Trustee may convert from one form to another any Contract held in
the Trust Fund; designate any mode of settlement; sell or assign any
Contract held in the Trust Fund; surrender for cash any Contract held
in the Trust Fund; agree with the insurance company issuing any
Contract to any release, reduction, modification or amendment thereof;
and, without limitation of any of the foregoing, exercise any and all
of the rights, options and privileges that belong to the absolute owner
of any Contract held in the Trust Fund that are granted by the terms of
any such Contract or by the terms of this Agreement.
The Trustee will hold in the Trust Fund the proceeds of any sale,
assignment or surrender of any Contract held in the Trust Fund and any
and all dividends and other payments of any kind received in respect to
any Contract held in the Trust Fund.
No insurance company which may issue any Contract based upon the
application of the Trustee will be responsible for the validity of this
Plan, be required to look into the terms of this Plan, be required to
question any act of the Plan Administrator or the Trustee hereunder or
be required to verify that any action of the Trustee is authorized by
this Plan. If a conflict should arise between the terms of the Plan and
any such Contract, the terms of the Plan will govern.
11.07 Fees and Expenses from Fund
The Trustee will be entitled to receive reasonable annual compensation
as may be mutually agreed upon from time to time between the Plan
Sponsor and the Trustee. The Trustee will pay all expenses reasonably
incurred by it in its administration and investment of the Trust Fund
from the Trust Fund unless the Plan Sponsor pays the expenses. No
person who is receiving full pay from the Plan Sponsor will receive
compensation for services as Trustee.
11.08 Records and Accounting
The Trustee will keep full and complete records of the administration
of the Trust Fund which the Employer and the Plan Administrator may
examine at any reasonable time. As soon as practical after the end of
each Plan Year and at such other reasonable times as the Employer may
direct, the Trustee will prepare and deliver to the Employer and the
Plan Administrator an accounting of the administration of the Trust,
including a report on the fair market value of all assets of the Trust
Fund.
11.09 Distribution Directions
If no one claims a payment or distribution made from the Trust, the
Trustee will notify the Plan Administrator and will dispose of the
payment in accordance with the subsequent direction of the Plan
Administrator.
11.10 Third Party
No person dealing with the Trustee will be obliged to see to the proper
application of any money paid or property delivered to the Trustee, or
to inquire whether the Trustee has acted pursuant to any of the terms
of the Plan. Each person dealing with the Trustee may act upon any
notice, request or representation in writing by the Trustee, or by the
Trustee's duly authorized agent, and will not be liable to any person
whomsoever in so doing. The certification of the Trustee that it is
acting in accordance with the Plan will be conclusive in favor of any
person relying on the certification.
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11.11 Professional Agents, Affiliates and Arbitration
(a) Professional Agents
The Trustee may employ and pay from the Trust Fund reasonable
compensation to agents, attorneys, accountants and other
persons to advise the Trustee as in its opinion may be
necessary. The Trustee may delegate to any agent, attorney,
accountant or other person selected by it any non-Trustee
power or duty vested in it by the Plan; the Trustee may act or
refrain from acting on the advice or opinion of any agent,
attorney, accountant or other person so selected.
(b) Use of Affiliates
(1) Charles Schwab Trust Company (CSTC) is authorized to
contract or make other arrangements with The Charles
Schwab Corporation, Charles Schwab & Co., Inc., their
affiliates and subsidiaries, successors and assigns
(collectively referred to as Schwab), and any other
organizations affiliated with or subsidiaries of CSTC
or related entities, for the provision of services to
the Trust Fund or Plan, except where such
arrangements are prohibited by law or regulation. As
used below, authorized person means any person whose
authorization is required pursuant to the provision
of any prohibited transaction exemption otherwise
applicable.
(2) CSTC is authorized to place securities orders, settle
securities trades, hold securities in custody and
other related activities on behalf of the Trust Fund
through or by Schwab whenever possible unless the
authorized person specifically instructs the use of
another Broker. Trades and related activities
conducted through the Broker will be subject to fees
and commissions established by the Broker, which may
be paid from the Trust Fund or netted from the
proceeds of trades.
(3) Trades will not be executed through Schwab unless the
Plan Administrator and the authorized person have
received disclosure concerning the relationship of
Schwab to CSTC, and the fees and commissions which
may be paid to Schwab, CSTC and any affiliate or
subsidiary of any of them as a result of using Schwab
to execute trades or for other services.
(4) CSTC is authorized to disclose such information as is
necessary to the operation and administration of the
Trust Fund to Schwab and to such other persons or
organizations that CSTC determines have a legitimate
business purpose for obtaining such information.
(5) At the direction of the authorized person, CSTC may
purchase shares of regulated investment companies (or
other investment vehicles) advised by Schwab or CSTC
("Schwab Funds"), except to the extent that such
investment is prohibited by law or regulation. Schwab
Fund shares may not be purchased for or held by the
Trust Fund unless the Plan Administrator has received
disclosure concerning the relationship of Schwab or
CSTC to the Schwab Funds, and any fees which may be
paid to such entities.
(6) To the extent permitted under applicable laws, CSTC
may invest in deposits, long and short term debt
instruments, stocks and other securities, including
those of CSTC or Schwab.
(7) CSTC and Schwab are authorized to tape record
conversations between CSTC or
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Schwab and persons acting on behalf of the Plan or a
Participant in order to verify data on transactions.
(c) Arbitration
Any dispute under this agreement will be resolved by
submission of the issue to a member of the American
Arbitration Association who is chosen by the Employer and the
Trustee. If the Employer and the Trustee cannot agree on such
a choice, each will nominate a member of the American
Arbitration Association, and the two nominees will then select
an arbitrator. Expenses of the arbitration will be paid as
decided by the arbitrator.
11.12 Valuation of Trust
The Trustee will value the Trust Fund as of the last day of each Plan
Year to determine the fair market value of the Trust, and the Trustee
will value the Trust Fund on such other date(s) as may be necessary to
carry out the provisions of the Plan.
11.13 Liability of Trustee
The Trustee will be liable only for the safeguarding and administration
of the assets of this Trust Fund in accordance with the provisions
hereof and any amendments hereto and no other duties or
responsibilities will be implied. The Trustee will not be required to
pay any interest on funds paid to or deposited with it or to its credit
under the provisions of this Trust, unless pursuant to a written
agreement between the Employer and the Trustee. The Trustee will not be
responsible for the adequacy of the Trust Fund to meet and discharge
any liabilities under the Plan and will not be required to make any
payment of any nature except from funds actually received as Trustee.
The Trustee may consult with legal counsel (who may be legal counsel
for the Employer) selected by the Trustee and will be fully protected
for any action taken, suffered or omitted in good faith in accordance
with the opinion of said legal counsel. It will not be the duty of the
Trustee to determine the identity or mailing address of any Participant
or any other person entitled to benefits hereunder, such identity and
mailing addresses to be furnished by the Employer, the Plan
Administrator or an agent of the Plan Administrator. The Trustee will
be under no liability in making payments in accordance with the terms
of this Plan and the certification of the Plan Administrator or an
agent of the Plan Administrator who has been granted such powers by the
Plan Administrator.
Except to the extent required by any applicable law, no bond or other
security for the faithful performance of duty hereunder will be
required of the Trustee.
11.14 Removal or Resignation and Successor Trustee
A Trustee may resign at any time upon giving 30 days prior written
notice to the Plan Sponsor or, with the consent of the Plan Sponsor, a
Trustee may resign with less than 30 days prior written notice.
The Plan Sponsor may remove a Trustee by giving at least 30 days prior
written notice to the Trustee.
Upon the removal or resignation of a Trustee, the Plan Sponsor will
appoint and designate a successor Trustee which will be one or more
individual successor Trustees or a corporate Trustee organized under
the laws of the United States or of any state thereof with authority to
accept and execute trusts. Any successor Trustee must accept and
acknowledge in writing its appointment as a successor Trustee before it
can act in such capacity.
Title to all property and records or true copies of such records
necessary to the current operation of the Trust Fund held by the
Trustee hereunder will vest in any successor Trustee acting pursuant to
the provisions hereof, without the execution or filing of any further
instrument. Any resigning or removed Trustee will execute all
instruments and do all acts necessary to vest such title in any
successor Trustee of record. Each successor Trustee will have, exercise
and enjoy all the powers, both discretionary and
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ministerial, herein conferred upon his predecessor. No successor
Trustee will be obligated to examine the accounts, records and acts of
any previous Trustee or Trustees, and each successor Trustee in no way
or manner will be responsible for any action or omission to act on the
part of any previous Trustee.
Any corporation which results from any merger, consolidation or
purchase to which the Trustee may be a party, or which succeeds to the
trust business of the Trustee, or to which substantially all the trust
assets of the Trustee may be transferred, will be the successor to the
Trustee hereunder without any further act or formality with like effect
as if the successor Trustee had originally been named Trustee herein;
and in any such event it will not be necessary for the Trustee or any
successor Trustee to give notice thereof to any person, and any
requirement, statutory or otherwise, that notice will be given is
hereby waived.
11.15 Appointment of Investment Manager
One or more Investment Managers may be appointed by the Plan Sponsor
(or the Plan Administrator) to exercise full investment management
authority with respect to all or a portion of the Trust assets.
Authorized payment of the fees and expenses of the Investment
Manager(s) may be made from the Trust assets. For purposes of this
agreement, any Investment Manager so appointed will, during the period
of his appointment, possess fully and absolutely those powers, rights
and duties of the Trustee (to the extent delegated by the Plan Sponsor
or the Plan Administrator) with respect to the investment or
reinvestment of that portion of the Trust assets over which the
Investment Manager has investment management authority. The Investment
Manager must be one of the following:
(a) Registered as an investment advisor under the Investment
Advisors Act of 1940;
(b) A bank, as defined in the Investment Advisors Act of 1940; or
(c) An insurance company qualified to manage, acquire, or dispose
of such Plan assets under the laws of more than one state.
Any Investment Manager will acknowledge in writing to the Plan Sponsor
or the Plan Administrator and to the Trustee that he or it is a
fiduciary with respect to the Plan. During any period of time when the
Investment Manager is so appointed and serving, and with respect to
those assets in the Plan over which the Investment Manager exercises
investment management authority, the Trustee's responsibility will be
limited to holding such assets as a custodian, providing accounting
services, disbursing benefits as authorized, and executing such
investment instructions only as directed by the Investment Manager. The
Trustee will not be responsible for any acts or omissions of the
Investment Manager. Any certificates or other instruments duly signed
by the Investment Manager (or the authorized representative of the
Investment Manager), purporting to evidence any instruction, direction
or order of the Investment Manager with respect to the investment of
those assets of the Plan over which the Investment Manager has
investment management authority, will be accepted by the Trustee as
conclusive proof thereof. The Trustee will also be fully protected in
acting in good faith upon any notice, instruction, direction, order,
certificate, opinion, letter, telegram or other document believed by
the Trustee to be genuine and from the Investment Manager (or the
authorized representative of the Investment Manager). The Trustee will
not be liable for any action taken or omitted by the Investment Manager
or for any mistakes of judgment or other action made, taken or omitted
by the Trustee in good faith upon direction of the Investment Manager.
11.16 Loans to Participants
This Plan authorizes the Trustee to lend on a nondiscriminatory basis
to an Active Participant in accordance with the loan policy established
by the Plan Administrator, provided that (a) loans are
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available to all Active Participants on a reasonably equivalent basis
and are not available in a greater amount for Highly Compensated
Employees than for other Employees; (b) any loan is adequately secured
and bears a reasonable rate of interest; (c) the loan provides for
repayment within a specified time; (d) the default provisions of the
note prohibit offset of the Participant's Nonforfeitable Accrued
Benefit prior to the time the Trustee otherwise would distribute the
Participant's Nonforfeitable Accrued Benefit; (e) the amount of the
loan does not exceed (at the time the Plan extends the loan) the
present value of the Participant's Nonforfeitable Accrued Benefit; and
(f) the loan otherwise conforms to the exemption provided by Code
Section 4975(d)(1). If the joint and survivor requirements of Section
5.05 apply to the Participant, the Participant may not pledge any
portion of his or her Accrued Benefit as security for a loan, unless,
within the 90-day period ending on the date the pledge becomes
effective, the Participant's spouse, if any, consents to the security
or, by separate consent, to an increase in the amount of security. If
the Employer is an unincorporated trade or business, a Participant who
is an Owner-Employee may not receive a loan from the Plan, unless he or
she has obtained a prohibited transaction exemption from the Department
of Labor. If the Employer is an "S Corporation," a Participant who is a
shareholder-employee (an employee or an officer) who, at any time
during the Employer's taxable year, owns more than 5%, either directly
or by attribution under Code Section 318(a)(1), of the Employer's
outstanding stock may not receive a loan from the Plan, unless he has
obtained a prohibited transaction exemption from the Department of
Labor. If the Employer is not an unincorporated trade or business nor
an "S Corporation," this Section does not impose any restrictions on
the class of Participants eligible for a loan from the Plan.
All Participant's Accounts, other than the Employee Stock Ownership
Account, are available to fund participant loans. All interest and
principal repayments will be credited to the Participant's Account from
which the loan was made.
In addition to any additional rules and regulations as the Plan
Administrator may adopt all loans will comply with the following terms
and conditions:
(a) Only Active Participants will be eligible to apply for a loan.
Each application for a loan will be made in writing to the
Plan Administrator, whose action thereon will be final.
(b) Each loan will be made against collateral being the assignment
of 50% of the borrower's entire right, title and interest in
and to the Trust Fund, supported by the borrower's promissory
note for the amount of the loan, including interest payable to
the order of the Trustee, and any additional security deemed
necessary to adequately secure the Loan. If a person fails to
make a required payment within 90 days of the due date set
forth in the loan agreement, the loan will be in default.
There will be no foreclosure against a Participant's Accrued
Benefit prior to his becoming entitled to a distribution of
benefits in accordance with the terms of this Plan. All loans
will become due and payable in full upon the termination of a
Participant's employment. If a Participant with an outstanding
loan terminates employment and becomes entitled to a
distribution of benefits from the Plan, then the outstanding
balance of the unpaid loan plus any accrued interest thereon
will be deducted from the amount of otherwise distributable
benefits and the Participant's promissory note will be
distributed to the Participant.
(c) The principal repayment will be amortized over the fixed life
of a loan with installments of principal and interest to be
paid not less often than quarterly. The period of repayment
for each loan will be arrived at by mutual agreement between
the Plan Administrator and the borrower, but in no event will
such period exceed a reasonable period of time. The period of
repayment will in no event exceed 5 years unless the loan is
to be used to acquire, construct, reconstruct or substantially
rehabilitate any dwelling unit which, within a reasonable
period of time, is to be used as a principal residence of the
Participant or a member of the family (spouse, brother,
sister, ancestor, or lineal descendants) of the Participant.
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(d) The minimum amount of any loan is equal to $1,000.
(e) The maximum amount of any loan is such that when the amount of
the loan is added to the outstanding balance of all other
loans made to the Participant from the Plan (and any other
plans maintained by the Employer or any Related Employer) the
total does not exceed the lesser of:
(1) 50% of the Participant's Vested Accrued Benefit. In
determining the Participant's Vested Accrued Benefit,
the Plan Administrator shall disregard amounts
attributable to the Employee Stock Ownership Account;
or
(2) $50,000, reduced by the amount, if any, of the
highest balance of all outstanding loans to the
Participant during the one-year period ending on the
day prior to the day on which the loan in question is
made.
(f) Each loan will bear interest at a rate equal to the prime rate
which is published in the Wall Street Journal as being
representative of the base rate on corporate loans at large
U.S. money center commercial banks on the date on which the
loan is made, plus 1 percentage point.
(g) A Participant may have no more than three (3) loans
outstanding at any time.
(h) Each loan will require the Participant (and, if the
Participant is married, the Participant's spouse) to consent
to the loan and the possible reduction in the Participant's
Accrued Benefit. Such consent must be made in writing within
the 90-day period before the making of the loan.
(i) No loan will be permitted to a Participant in a year in which
he is either an Owner-Employee or Shareholder-Employee as
defined in Code Section 4975(d).
The spousal consent must meet requirements which are
comparable to the requirements described in Code Section
417(a)(2). Any security interest held by the Plan by reason of
an outstanding loan is taken into account in determining the
value of a Qualified Survivor Annuity. However, in the event a
Participant defaults on a loan, the security interest in the
loan will be deducted from the Qualified Survivor Annuity.
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ARTICLE 12
PROVISIONS RELATING TO EMPLOYER STOCK
12.01 Investment in Company Stock
(a) The Trustee shall invest Participant Employee Stock Ownership
and Company Matching Contribution Accounts primarily in
Company Stock to the extent practicable and may invest one
hundred percent (100%) of such Accounts in Company Stock. The
Company Stock may be Treasury Stock which has been purchased
by the Employer; stock which has been authorized, but never
issued by the Employer; Company Stock traded on a public
market; or Company Stock owned by shareholders of the
Employer. Provided, however, that the Trustee shall invest the
proceeds of an Acquisition Loan to acquire Company Stock only
in "qualifying employer securities." For purposes of
determining Voting Rights under subsection (e), Company Stock
shall include shares of Getchell Gold Corporation stock held
in the Trust Fund.
(b) Purchase Price. For the purchase of Company Stock, from the
Employer or from a shareholder of the Employer, the Trustee
shall not pay more than fair market value as determined by the
current market price of the Company Stock, if there is a
market, and if there is not a market for the stock, then as
determined by an independent appraisal after taking into
account the book value of the stock, the earnings of the
Employer and other factors normally taken into account in
determining fair market value of stock of a corporation. For
the purchase of Company Stock from a Disqualified Person, the
value of the Company Stock must be determined as of the date
of the transaction. For any other purchase, the value shall be
at the discretion of the Trustee, based on a current valuation
or based upon the price fixed as of the most recent Valuation
Date. Notwithstanding the preceding provisions of this
Section, the Trustee may purchase Company Stock at a price
lower than that determined in accordance with the preceding
provisions of this Section from any source whatsoever. If a
public market is made for the Company Stock, the Trustee shall
purchase the Company Stock at the public trading price
determined at the time of the purchase regardless of whether
such stock is purchased from the Employer or on the open
market.
(c) Acquisition Loan. The Trustee is expressly authorized to enter
into an Acquisition Loan transaction. The following terms and
conditions apply to any Acquisition Loan.
(i) The Trustee shall use the proceeds of any Acquisition
Loan:
(A) to acquire Company Stock described in
Section 1.10(b)(i), (ii) or (iii);
(B) to repay the Acquisition Loan; or
(C) to repay a prior Acquisition Loan.
(ii) Any Acquisition Loan shall provide that the creditor
is without recourse against the Plan and Trust. The
Acquisition Loan shall further provide that no person
entitled to payment under the Acquisition Loan shall
have any rights to the assets of the Plan and Trust
other than:
(A) the collateral given under the Acquisition
Loan;
(B) contributions (other than contributions of
Company Stock) made by the
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Employer to meet the repayment requirements
of the Acquisition Loan; or
(C) earnings attributable to:
(1) the Company Stock pledged as
collateral for such loan; or
(2) the Employer contributions
described in the preceding
paragraph (B).
(iii) Any Acquisition Loan shall provide that payments made
on the loan by the Plan shall not exceed for any Plan
Year an amount equal to the sum of Employer
Contributions and Plan earnings for the current Plan
Year, plus the amounts in prior years, less the sum
of the note payment for prior years.
(iv) Collateral for the Acquisition Loan shall be
restricted to Company Stock acquired with the
proceeds of the Acquisition Loan or Company Stock
acquired with a prior Acquisition Loan which prior
Acquisition Loan is repaid with the proceeds of the
Acquisition Loan.
(v) Any Acquisition Loan shall provide that in the event
of default, the value of the Plan assets transferred
in satisfaction of the Acquisition Loan must not
exceed the amount of the default. If the lender is a
Disqualified Person, the Acquisition Loan shall
provide for the transfer of Plan assets upon default
only upon and to the extent of the failure of the
Plan to meet the repayment schedule of the loan.
(vi) Any Acquisition Loan shall provide for a reasonable
rate of interest, taking into account all relevant
factors.
(vii) Any Acquisition Loan shall provide for a release from
encumbrance of shares of Company Stock held as
collateral as of each Anniversary Date equal to the
number of encumbered shares of Company Stock held
immediately before the release, multiplied by a
fraction. The numerator of the fraction is the amount
of principal and interest paid during the Plan Year.
The denominator of the fraction is the sum of the
principal and interest to be paid in all future years
without taking into account any possible extensions
of the loan. If a variable rate of interest is used,
the calculation of the denominator shall be based
upon the rate applicable as of the end of the Plan
Year in question. Release of shares of more than one
class shall be made on a pro rata basis applying such
fraction.
(viii) Any Acquisition Loan shall call for a definitely
determinable period of repayment and may not be
payable at the demand of any person except in the
case of default.
(ix) The Trustee shall comply with all requirements under
Code Section 4975 and the applicable Treasury
regulations to assure that the loan qualifies as an
Acquisition Loan.
(x) Notwithstanding that this Plan ceases to be an
employee stock ownership plan, Company Stock acquired
with the proceeds of an Acquisition Loan will
continue, after the Trustee repays the loan, to be
subject to the provisions of Treasury Regulations
Sections 54.4975-7(b)(4), (10), (11) and (12)
relating to put, call or other options and to
buy-sell or similar arrangements, except to the
extent those regulations are inconsistent with Code
Section 409(h).
(d) Allocation. The Trustees shall allocate all Company Stock
contributed or purchased for each
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Plan Year in accordance with the provisions of Sections
3.03(a)(6) and 3.04(a)(6) as applicable. Additional shares or
fractional shares of Company Stock shall be added to each
Participant's Company Stock Sub-Account as of the applicable
Contribution Period.
(i) Provided, however, that the Trustee shall hold any
shares of Company Stock which are acquired with the
proceeds of an Acquisition Loan in a suspense
account. As of each Anniversary Date, a pro rata
amount of such Company Stock shall be released from
the suspense account in accordance with Section
12.01(c)(vii), and allocated in accordance with the
immediately preceding paragraph. The amount to be
released shall equal the total number of shares
acquired from the proceeds of the Acquisition Loan,
multiplied by a fraction. The numerator of the
fraction is the amount of principal and interest paid
on the loan during the Plan Year. The denominator of
the fraction is the sum of the numerator plus the
principal and interest to be paid for all future
years, without taking into account any possible
extensions of the loan.
(ii) Any dividend income received during the year for the
shares held in suspense shall be applied by the
Trustee in the subsequent year towards the repayment
of the Acquisition Loan.
(e) Voting Rights
(i) Regarding the Company Stock held in the Trust Fund,
the Trustee may vote the same in person or by proxy;
may join in any merger, reorganization of capital
adjustment; may exercise or sell any conversion,
subscription, or similar rights; and may hold any
assets in the name of its nominee or unregistered
agent. A majority vote of the Trustees shall control
the vote of the Company Stock.
(ii) Notwithstanding the foregoing, if the Employer has a
registration-type class of securities defined in Code
Section 409(e)(4), each Participant or Beneficiary in
the Plan shall be entitled to direct the Trustee as
to the manner in which his or her allocable share of
the Company Stock held in the Trust Fund will be
voted. If the Employer does not have a
registration-type class of securities defined in Code
Section 409(e)(4), each Participant or Beneficiary
shall be entitled to direct the Trustee as to the
manner in which the voting rights under securities of
the Employer which are allocated to his or her
account are to be exercised regarding any corporate
matter involving the voting of the shares with
respect to the approval or disapproval of any
corporate merger or consolidation, recapitalization,
reclassification, liquidation, dissolution, sale of
substantially all assets of a trade or business, or
any similar transaction which the Secretary may
prescribe in regulations.
(f) Tender Offers
Each Participant, or, in the event of his death, his
Beneficiary, shall have the right, to the extent of the number
of full shares of Company Stock in his account, to direct the
Trustee in writing as to the manner in which to respond to a
tender or exchange offer with respect to shares of such
Company Stock.
The Employer shall utilize its best efforts to timely
distribute or cause to be distributed to each Participant (or
Beneficiary) such information as will be distributed to
shareholders of the Employer in connection with any such
tender or exchange offer.
The Trustee shall, with respect to all Company Stock held in
the Trust Fund, accept or reject the
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terms of any tender offer and, accordingly, tender Company
Stock held by the Trustee in the Trust Fund in accordance with
the terms and provisions of any tender offer, or not tender
such Company Stock, as directed by the respective Participants
(or Beneficiaries). With respect to shares of Company Stock
which are allocated to Participants who have not given
directions, the Trustee shall not tender any shares of Company
Stock with respect to which such Participants (or
Beneficiaries) have the right of direction.
The Plan Administrator may establish such rules and guidelines
as it deems appropriate to properly effect the provisions of
this Section.
(g) Shareholder Agreements
The Trustee may enter into agreements with shareholders to
purchase shares of Company Stock under which the Trustee is
granted an option to purchase all or a portion of the shares
of Company Stock owned by the shareholders on the death of the
shareholder or shareholders. To provide for the funding of the
purchase of shares of Company Stock, the Trustee may apply for
and pay premiums on contracts of life insurance on the life of
such shareholder for the benefit of the Trust Fund as a whole,
provided, however, that if this Plan invests in Leveraged
Company Stock the Trustee may not enter into any agreement
which would obligate the Plan and Trust to purchase Company
Stock from a particular shareholder at an indefinite time
determined upon the happening of an event such as the death of
the shareholder.
12.02 Partial Diversification of Investment
A Qualified Participant may elect within the Diversification Election
Interval during his Qualified Election Period to direct the trustee on
the investment of: (a) not more than twenty-five percent (25%) of the
Qualified Participant's Accrued Benefit (excluding accumulated
contributions in the Participant's Pre 401(k) Account) at the end of
the Plan Year, reduced by amounts previously diversified, during the
first four (4) years of his Qualified Election Period; and (b) not more
than fifty percent (50%) of the Qualified Participant's Accrued Benefit
(excluding accumulated contributions in the Participant's Pre 401(k)
Account) at the end of the Plan Year, reduced by amounts previously
diversified, during the fifth (5th) year of his Qualified Election
Period.
The Trustee shall complete diversification of a Qualified Participant's
investment in accordance with a Qualified Participant's Election no
later than ninety (90) days after the close of the Diversification
Election Interval. The Trustee shall satisfy this requirement: (a) by
distributing to the Participant an amount equal to the amount for which
the Participant elected diversification; or (b) by substituting for the
amount of the Company Stock for which the Participant elected
diversification an equivalent amount of other assets, according to the
Participant's investment direction based on at least three (3)
investment options consistent with applicable Treasury regulations. All
valuations of Company Stock contemplated herein must be made by an
independent appraiser if not publicly traded on an established
securities market.
For purposes of this Section, the following definitions apply:
(a) "Qualified Participant" means any Employee who has completed
at least ten (10) years of participation under the Plan and
has attained age fifty-five (55) years.
(b) "Qualified Election Period" means the six (6) Plan Year Period
beginning with the later of:
(i) the first Plan Year in which the individual first
became a qualified Participant, or
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(ii) the first Plan Year beginning after December 31,
1986.
The Employer may elect to treat an individual first becoming a
qualified Participant in the first Plan Year beginning in 1987
as having become a Participant in the first Plan Year
beginning in 1988.
(c) "Diversification Election Interval" means the span of ninety
(90) days after the close of each Plan Year within a Qualified
Participant's Qualified Election Period.
12.03 Dividend Distributions
If so determined by the Board of Directors of the Employer, any
applicable dividends on Company Stock allocated to the Company Stock
Accounts of Participants may be paid currently (or within 90 days after
the Anniversary Date of the Plan Year in which the dividends are paid
to the Trust) in cash to such Participants on a nondiscriminatory
basis, or the Employer may pay such dividends directly to Participants.
Such distribution (if any) of applicable dividends to Participants may
be limited to Participants who are Active Participants, may be limited
to dividends on shares of Company Stock allocated to Participants'
Company Stock Sub-Accounts which are then vested or may be applicable
to dividends on all Company Stock Sub-Accounts.
12.04 Put Option
(a) Stock Subject to Put. The Employer shall issue a put option to
each former Participant receiving a distribution of Company
Stock from the Plan that is not readily tradeable on an
established securities market in accordance with the terms set
forth in this Section.
(b) Period, Exercise of Option. The put option shall be
exercisable during the sixty (60) day period beginning on the
date that the shares of Company Stock subject to the put
option are distributed to the Participant. If the option is
not exercised during such period, the put option shall be
exercisable for an additional period of sixty (60) days during
the following Plan Year after the Plan Administrator
determines the fair market value of the Company Stock, as
provided in applicable Treasury regulations. The put option
shall be exercisable only by a Participant; by the
Participant's donee; or by a person, including an estate or
its distributee, to whom such Company Stock has passed because
of the Participant's death. For purposes of this Section,
Participant means the Plan Participant or designated death
Beneficiary.
(c) Rights Under Put Option. The put option shall give to the
eligible holder the right to put such shares to the Employer
based upon a fair valuation formula established by the Plan
Administrator. Such put option may grant to the Trustee an
option to assume the rights and obligations of the Employer at
the time the put option is exercised. The Trustee shall be
under no obligation to exercise this option.
(d) Option Rights Not Affected by Amendment. The rights provided
to Participants under this Article shall be non-terminable and
no amendment to this Plan shall affect these rights except
such amendments to this Article as may be required to assure
the continuing qualification of the Plan under the Code.
(e) Commencement and Form of Payment. If Company Stock is
distributed as part of a total distribution, the payment for
such stock sold under a put option shall be made no later than
30 days after the date the put option was exercised. Payment
may be made in a lump sum, or in substantially equal, annual
installments over a period not exceeding five years, as
described in
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Section 5.05. If payment for Company Stock sold under a put
option is made in installments, the first installment shall be
paid not later than 30 days after the date on which the put
option was exercised, and the Company shall provide adequate
security (within the meaning of Section 409(h)(5) of the Code
and regulations thereunder) to secure payment of the unpaid
installments, and pay interest on the unpaid installment
balance at a reasonable rate (as determined by the Company or
the Plan Administrator). The Plan Administrator shall give
written notice of the terms and conditions of the put option
to the Participant at the time of distribution and at the
beginning of the second option period.
If Company Stock is distributed to a Participant as part of an
installment distribution, the payment for any Company Stock
sold under a put option shall be made no later than 30 days
after the date the put option was exercised.
12.05 Lifetime Transfer/Right of First Refusal
(a) Notice of Offer. If a former Participant or Beneficiary, who
has received a distribution of Company Stock, receives a bona
fide offer for the purchase of all or a portion of the shares,
the person shall give written notice of the offer to the
Trustees and to the Employer. The notice shall set forth the
name of the proposed transferee, the number of shares to be
transferred, the price per share, and all other terms and
conditions of the proposed transfer.
(b) Right of First Refusal. On receipt of the notice regarding the
transfer, the Trustees shall have the exclusive right and
option, exercisable at any time during a period of fourteen
(14) days from the date of the notice to purchase the shares
of the Employer covered by the offer in question at the same
price and on the same terms and conditions of the offer as set
out in the notice. If the Trustees decide to exercise the
option, the Trustees shall give written notice of this effect
to the Former Participant or Beneficiary desiring to sell, and
the sale and purchase shall be closed within thirty (30) days
thereafter. If the Trustees do not elect to exercise the
option to purchase any or all of the offered shares, the
Trustees shall, prior to the expiration of the fourteen (14)
day period stated above, notify the Employer of the Trustees'
election, and the Employer shall be entitled during the
remainder of the fourteen (14) day period to purchase that
portion of the offered shares, not so purchased by the
Trustees, on the same terms and conditions as set out in the
offer.
(c) Requirements. Notwithstanding the foregoing, the right of
first refusal shall be subject to the following requirements:
(i) The Company Stock subject to such right must be
equity or debt convertible into equity;
(ii) The right of first refusal may not be exercised at a
time when the Company Stock is publicly traded;
(iii) The right of first refusal may be granted only to the
Trustees and the Employer;
(iv) The selling price and terms of purchase by either the
Trustees or Employer, pursuant to this right of first
refusal, shall be no less favorable to the seller
than the greater of the selling price and terms
offered by a good faith purchaser or fair market
value;
(v) The right of first refusal shall lapse no later than
fourteen (14) days after notice of the third party
offer is given.
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12.06 Nonterminable Protections and Rights
Except as provided in this Article, no Company Stock may be subject to
a put, call, or other option, or buy-sell or similar arrangement when
held by and when distributed from the Trust Fund, whether or not the
Plan is then an employee stock ownership plan. The protections and
rights granted in this Article, in Sections 5.05 and 5.07 pursuant to
Code Section 409(o) attributable to stock acquired after December 31,
1986, and in Section 12.02 pursuant to Code Section 401(a)(28)(B), are
nonterminable and shall continue to exist under the terms of this Plan
so long as any Company Stock is held by the Trust Fund or by any
Participant or other person for whose benefit such protections and
rights have been created. Neither the repayment of an Acquisition Loan
described in Section 12.01 nor the failure of the Plan to be an
employee stock ownership plan, nor an amendment of the Plan shall cause
a termination of the protections and rights.
12.07 Special Provisions Applicable to Employer Securities
In accordance with Rule 16(b)-3 adopted by the Securities and Exchange
Commission, the following provisions shall apply with respect to
purchases, sales and allocations to Participant accounts of Company
Stock, notwithstanding anything else to the contrary in this Plan or in
any rules adopted hereunder:
(a) Annual Limit on Shares Acquired or Awarded
The Plan shall not acquire or award to Participants in any
fiscal year of the Plan more than 2% of the outstanding shares
of Common Stock of the Company or more than 2% of the
outstanding shares of Common Stock of First Miss Gold, in each
case based on the number of such shares outstanding as of the
beginning of each such fiscal year; and
(b) Fiduciary Duties with regard to Prices and Values
The Trustee and other Plan Fiduciaries shall act in accordance
with their fiduciary duties in determining the prices at which
the Trustee shall purchase Company Stock and in determining
the value used in allocating such securities to Participant
Accounts.
12.08 Limitation with Respect to an Electing Estate or Shareholder
(a) If the executor of the estate of a deceased shareholder sells
Company Stock to the Trust and elects (with the consent of the
Company) an estate tax deduction pursuant to Section 2057(a)
of the Code, or if a shareholder sells Company Stock to the
Trust and elects (with the consent of the Company) favorable
tax treatment under Section 1042 of the Code, then no portion
of the Trust Assets attributable to (or allocable in lieu of)
the Company Stock acquired by the Trust in such transaction
may be allocated (directly or indirectly):
(i) During the "nonallocation period", to the Accounts of
the decedent whose estate makes such sale; or to the
shareholder who makes the sale;
(ii) During the "nonallocation period" to the Accounts of
any person related to the decedent or shareholder
(within the meaning of Section 267(b) of the Code; or
(iii) To the Accounts of any shareholder owning (as
determined under Section 318(a) of the Code, at any
time described in Code Section 409(n)(3)(B), more
than 25% (in value or in number of shares) of any
class of outstanding stock of the Company.
(b) For purposes of this Section, the "nonallocation period" is
the ten-year period beginning on the later of:
(i) the date on which the Company Stock held by the
estate or shareholder is sold to the
92
<PAGE> 93
Plan, or
(ii) if such Company Stock is acquired with the proceeds
of an Acquisition Loan, the date of allocation of the
shares of Company Stock released from the suspense
account (as described in Section 12.01(d) with
respect to the final payment on such Acquisition
Loan.
93
<PAGE> 94
IN WITNESS WHEREOF, this instrument has been executed by the duly authorized and
empowered officers of the Employer, this 2nd day of December, 1997.
CHEMFIRST INC.
By: /s/ THOMAS G. TEPAS
-----------------------------------------
President
The Trustee agrees to continue to serve as Trustee under the terms of this
instrument.
CHARLES SCHWAB TRUST COMPANY
By: /s/ GREGORY MUNSON
-----------------------------------------
94
<PAGE> 1
EXHIBIT 4.7
FIRST AMENDMENT TO
CHEMFIRST, INC.
401(k) AND EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
THIS AMENDMENT, effective JANUARY 1, 1998, by and between CHEMFIRST,
INC., a Business Corporation, having its principal office in Jackson,
Mississippi (hereinafter referred to as "Employer"), and CHARLES SCHWAB TRUST
COMPANY (hereinafter sometimes referred to as "Trustee");
R E C I T A L S:
A. WHEREAS, the Employer has previously established the ChemFirst, Inc.
401(k) and Employee Stock Ownership Plan and Trust ("Plan and Trust") for the
benefit of those employees who qualify thereunder and for their beneficiaries;
and
B. WHEREAS, the Employer desires to amend the Plan and Trust to (i)
clarify the definition of Eligible Employee and (ii) eliminate the service
requirement for purposes of eligibility and entry in the Plan;
NOW, THEREFORE, pursuant to Section 10.01 of the Plan and Trust, the
following amendment is hereby made and shall be effective as of JANUARY 1, 1998:
1. SECTION 1.13 OF THE PLAN IS AMENDED AS UNDERLINED TO READ AS FOLLOWS:
1.13 Eligible Employee Classification
An Eligible Employee Classification is a classification of Employees,
the members of which are eligible to participate in the Plan. All
Employees who are classified as "Regular Employees" are eligible to
participate in the Plan.
2. SECTION 1.15 OF THE PLAN IS AMENDED AS UNDERLINED TO READ AS FOLLOWS:
1.15 Employee
(a) In General
An Employee is any person who is employed by the Employer or a
Participating Employer.
(b) Leased Employee
A Leased Employee means any person who, pursuant to an
agreement between the Employer or any Related Employer
("Recipient Employer") and any other person ("leasing
organization"), has performed services for the Recipient
Employer on a substantially full-time basis for a period of at
least one year and such services are performed under the
primary direction or control of the Recipient Employer.
<PAGE> 2
Any Leased Employee will be treated as an Employee of the
Recipient Employer; however, contributions or benefits
provided by the leasing organization which are attributable to
the services performed for the Recipient Employer will be
treated as provided by the Recipient Employer. If all Leased
Employees constitute less than 20% of the Employer's
non-highly-compensated work force within the meaning of Code
Section 414(n)(1)(C)(ii), then the preceding sentence will not
apply to any Leased Employee if such Employee is covered by a
money purchase pension plan ("Safe Harbor Plan") which
provides: (1) a nonintegrated employer contribution rate of at
least 10% of compensation, (2) immediate participation, and
(3) full and immediate vesting.
Years of Eligibility Service for purposes of eligibility to
participate in the Plan and Years of Vesting Service for
purposes of determining a Participant's Vested Percentage
include service by an Employee as a Leased Employee.
(c) Regular Employee
Regular Employee is an Employee (whether full time or part
time) hired to fill a specific position on a permanent basis
and for whom the Employer annually budgets compensation and
benefits.
3. SECTION 1.27 OF THE PLAN IS AMENDED IN ITS ENTIRETY TO READ AS FOLLOWS:
1.27 One Year Break-in-Service
One Year Break-in-Service means any 365-day period following a
Participant's Date of Termination in which an Employee does not
complete at least one (1) Hour of Service.
4. SECTION 1.45 OF THE PLAN IS AMENDED IN ITS ENTIRETY TO READ AS FOLLOWS:
1.45 Year of Service
(a) Crediting Years of Service. Years of Service are determined
using the Elapsed Time Method as specified in this Section.
(1) Elapsed Time Method. The Elapsed Time Method shall be
used to compute Years of Eligibility Service and
Years of Vesting Service for all Regular Employees.
Under the Elapsed Time Method, Years of Service are
based upon an Employee's Elapsed Time of employment
irrespective of the number of hours actually worked
during such period; a Year of Service (including a
fraction thereof) will be credited for each completed
365 days of Elapsed Time which need not be
consecutive. The following terms are used in
determining Years of Service under the Elapsed Time
Method:
o Date of Severance (Termination) - means the
earlier of (A) the actual date an Employee
resigns, is discharged, dies or retires, or
(B) the first anniversary of the date an
Employee is absent from work (with or
without pay) for any other reason, e.g.,
disability, vacation, leave of absence,
layoff, etc.
o Elapsed Time - means the total period of
service which has elapsed between a
Participant's Employment Commencement Date
and Date of Termination including Periods of
Severance where a One Year Break-in-Service
does not occur.
<PAGE> 3
o Employment Commencement Date - means the
date an Employee first performs one Hour of
Service for the Employer.
o One Year Break-in-Service - means any
365-day period following an Employee's Date
of Termination as defined above in which the
Employee does not have at least one Hour of
Service.
o Period of Severance - is the time between
the actual Date of Severance as defined
above and the subsequent date, if any, on
which the Employee performs an Hour of
Service.
All periods of employment will be aggregated
including Periods of Severance unless there is a One
Year Break-in-Service.
Years of Eligibility Service for purposes of determining
eligibility to participate in the Plan and Years of Vesting
Service for purposes of determining a Participant's Vested
Percentage include service with any organization which is a
Related Employer with respect to the Employer.
(b) For Eligibility Purposes. All Regular Employees who have
completed at least one (1) hour of service shall be eligible
to participate in the Plan.
(c) For Vesting Purposes
Years of Service for purposes of computing a Participant's
Vested Percentage are referred to as Years of Vesting Service
and are determined using the Elapsed Time Method. For purposes
of determining an Employee's Years of Vesting Service, an
Employee shall receive credit for the aggregate of all time
periods commencing on an Employee's Employment Commencement
Date, including the Re-Employment Commencement Date, and
ending on the date a Break-in-Service begins. An Employee also
shall receive credit for any Period of Severance of less than
365 days. A Year of Vesting Service (including a fraction
thereof) will be credited for each completed 365 days of
Elapsed Time which need not be consecutive. In computing an
Employee's Years of Vesting Service, the following rules shall
apply:
(i) Service shall be disregarded in computing a
Participant's Years of Vesting Service under the Plan
for Plan Years beginning prior to March 1, 1985, for
which the Employee was eligible to make basic
contributions (after-tax contributions) but declined
to make any such contributions to the Plan, if such
period occurred prior to his initial date of
participation in the Plan.
(ii) Service shall be disregarded in computing a
Participant's Years of Vesting Service for Plan Years
beginning on or after March 1, 1985, but before
October 1, 1993, for which the Employee was eligible
to direct the Employer to make Salary Deferral
Contributions on his behalf but declined to direct
the Employer to make any such contributions to the
Plan; and if such period occurred prior to his
initial date of participation in the Plan.
(iii) Service prior to July 1, 1974, shall be disregarded
in computing a Participant's Years of Vesting
Service.
<PAGE> 4
(d) Related Employers
Years of Eligibility Service for purposes of determining
eligibility to participate in the Plan and Years of Vesting
Service for purposes of determining a Participant's Vested
Percentage include service with any organization which is a
Related Employer with respect to the Employer.
(e) Loss of Service
If a Participant who is zero percent (0%) vested terminates
employment and incurs at least 5 consecutive One Year
Breaks-in-Service, he or she will lose all prior Eligibility
Service and Vesting Service.
(f) Change in Computation Method
With respect to the Employee Stock Ownership Plan Accounts
merged hereunder, for purposes of determining a Participant's
Years of Vesting Service in those Accounts as of December 31,
1996, the method used to calculate Years of Vesting Service
shall be the method described in Section 2.14 of the First
Mississippi Corporation Employee Stock Ownership Plan prior to
August 1, 1996, or in this Section 1.45, whichever will result
in the higher vested percentage.
5. SECTION 2.01 OF THE PLAN IS AMENDED IN ITS ENTIRETY TO READ AS FOLLOWS:
2.01 Participation
All Regular Employees are eligible to participate in the Plan on the
Regular Employee's Employment Commencement Date.
Employees not eligible to participate in the Plan are:
o Collective Bargaining Employees. Each Employee who is a member
of a collective bargaining unit shall not be eligible to
participate in this Plan unless the collective bargaining
agreement provides otherwise. An Employee is a member of a
collective bargaining unit if the Employee is 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 one or more employers if there is
evidence that retirement benefits were the subject of good
faith bargaining between the Employee representatives and the
employer or employers. The term "Employee representatives"
does not include an organization of which more than one-half
(1/2) the members are owners, officers, or executives of the
Employer.
o Leased Employees.
An Employee who is otherwise eligible to participate may irrevocably
elect not to participate in the Plan. Any election under this paragraph
must be in writing and according to guidelines established by the Plan
Administrator.
<PAGE> 5
IN WITNESS WHEREOF, this instrument has been executed by the duly
authorized and empowered officers of the Employer, this 31st day of December,
1998.
EMPLOYER:
CHEMFIRST, INC.
By: /s/ James R. Lewis
-------------------------------------------
TRUSTEE:
CHARLES SCHWAB TRUST COMPANY
By: /s/ K. Mason
-------------------------------------------
<PAGE> 1
Exhibit 4.10
SECOND AMENDMENT TO
CHEMFIRST INC.
401(k) SAVINGS AND EMPLOYEE STOCK OWNERSHIP PLAN AND TRUST
THIS AMENDMENT, effective as specifically stated herein, by and
between CHEMFIRST INC., a Business Corporation, having its principal office in
Jackson, Mississippi (hereinafter referred to as "Employer"), and CHARLES
SCHWAB TRUST COMPANY (hereinafter sometimes referred to as "Trustee");
R E C I T A L S:
A. WHEREAS, the Employer has previously established the ChemFirst Inc.
401(k) Savings and Employee Stock Ownership Plan and Trust ("Plan and Trust")
for the benefit of those employees who qualify thereunder and for their
beneficiaries; and
B. WHEREAS, the Employer desires to amend the Plan and Trust to (i)
clarify the definition of Eligible Employee; (ii) increase the cashout
distribution threshold to $5,000; and (iii) incorporate those special trust
provisions requested by the Plan Trustee that are described in the Addendum &
Letter Agreement attached hereto, for informational purposes only, as Exhibit
A;
NOW, THEREFORE, pursuant to Section 10.01 of the Plan and Trust, the
following amendment is hereby made and shall be effective as specifically
stated herein:
1. EFFECTIVE JANUARY 1, 1999, SECTION 1.13 OF THE PLAN IS AMENDED AS
UNDERLINED TO READ AS FOLLOWS:
1.13 Eligible Employee Classification
An Eligible Employee Classification is a classification of Employees,
the members of which are eligible to participate in the Plan. All
Employees who are classified as "Regular Employees" are eligible to
participate in the Plan. Any reference to Employee within this
Agreement is assumed to mean an Employee who is classified as a
Regular Employee.
1
<PAGE> 2
2. EFFECTIVE JANUARY 1, 1997, SECTION 1.34(e) OF THE PLAN IS AMENDED AS
UNDERLINED TO READ AS FOLLOWS:
1.34 Qualified Annuity Definitions
* * * *
(e) Qualified Survivor Annuity
A Qualified Survivor Annuity which a Surviving Spouse will be
eligible to receive under the provisions of Section 6.02
means a monthly benefit payable for the remaining lifetime of
the Surviving Spouse. The amount of the Qualified Survivor
Annuity benefit will be the amount of benefit which can be
purchased from an Insurer with the Participant's Vested
Accrued Benefit.
If the Participant's Vested Accrued Benefit is $3,500 ($5,000
for Plan Years beginning after August 5, 1997) or less, the
Plan Administrator will direct the immediate distribution of
the Participant's Vested Accrued Benefit to the Surviving
Spouse. If the Participant's Vested Accrued Benefit at the
time of any distribution exceeds $3,500 ($5,000 for Plan
Years beginning after August 5, 1997), the Vested Accrued
Benefit at any later time will be deemed to exceed $3,500
($5,000 for Plan Years beginning after August 5, 1997). The
Surviving Spouse may elect to receive the Qualified Survivor
Annuity as a lump sum.
3. EFFECTIVE JANUARY 1, 1997, SECTION 5.05 OF THE PLAN IS AMENDED AS
UNDERLINED TO READ AS FOLLOWS:
5.05 Form of Benefit Payment
Subject to the provisions of Section 5.06, the Plan Administrator will
direct the Trustee to make the payment of any benefit provided under
this Plan upon the event giving rise to such benefit within 60 days
following the receipt of a Participant's written request for the
payment of benefits on a form provided by the Plan Administrator. The
Plan Administrator may temporarily suspend such processing in the
event of unusual or extraordinary circumstances such as the conversion
of Plan records from one recordkeeper to another.
The form of benefit will be determined as follows:
(a) a Participant who is not married on the date benefits are to
commence will be provided a Qualified Life Annuity, unless a
lump sum payment is elected, under a Qualified Election, by
the Participant within the 90-day period which ends on his
benefit commencement date.
(b) a Participant who is married on the date benefits commence
will be provided a Qualified Joint and Survivor Annuity
unless a lump sum payment is elected, under a Qualified
Election, by the Participant within the 90-day period which
ends on his benefit commencement date.
Within the 90-day period which ends on a married Participant's
expected benefit commencement date, the Plan Administrator will
provide each Participant with a written explanation of:
(a) the terms and conditions of a Qualified Joint and Survivor
Annuity;
(b) the Participant's right to make and the effect of a Qualified
Election to waive the Qualified Joint and Survivor Annuity
form of benefit;
(c) the rights of a Participant's spouse; and
(d) the right to make, and the effect of, a revocation of a
previous Qualified Election to waive the Qualified Joint and
Survivor Annuity.
2
<PAGE> 3
Notwithstanding the above, if a terminated Participant's Vested
Accrued Benefit is $3,500 ($5,000 for Plan Years beginning after
August 5, 1997) or less, such Participant's Vested Accrued Benefit
shall be payable in a lump sum of the entire amount of his Vested
Accrued Benefit. If the value of his Vested Accrued Benefit at the
time of any distribution exceeds $3,500 ($5,000 for Plan Years
beginning after August 5, 1997), the value of his Vested Accrued
Benefit at any later time will be deemed to also exceed $3,500 ($5,000
for Plan Years beginning after August 5, 1997).
Upon request, the Participant may receive his benefit paid in a series
of substantially equal annual or more frequent installments from the
Trust Fund over a period certain not extending beyond the end of the
period measured by the joint life and last survivor expectancy of the
Participant and his spouse. A Participant may elect to receive an
installment distribution in the form of a Nontransferable Annuity
Contract. The Plan Administrator and the Trustee will have the power
to establish rules and guidelines as deemed necessary or appropriate
with regard to the payment of benefits under the installment payment
form.
Notwithstanding the foregoing, if Company Stock acquired with the
proceeds of an Acquisition Loan available for distribution consist of
more than one class, a distributee must receive substantially the same
proportion of each class. A Participant entitled to a distribution
under this Section shall have the right to demand that all payments
under the foregoing paragraphs be made in Company Stock or in cash for
fractional shares to the extent his or her Accounts are invested in
Company Stock. A Participant's benefits attributable to Company Stock
may be paid in whole or in part in cash.
4. EFFECTIVE JANUARY 1, 1997, SECTION 7.02(b) OF THE PLAN IS AMENDED BY
ADDING THE FOLLOWING SUBSECTION TO READ AS FOLLOWS:
7.02 (b) Where Employer Maintains a Qualified Defined Benefit Plan
* * * * *
(4) For Plan Years beginning after December 31, 1999,
the combined plan limits of Code Section 415(e)
shall no longer apply.
5. EFFECTIVE JANUARY 1, 1997, SECTION 7.03(a) OF THE PLAN IS AMENDED BY
ADDING THE FOLLOWING PARAGRAPH TO READ AS FOLLOWS:
7.03 Definitions Applicable to Article 7
* * * * *
Notwithstanding the foregoing, in the case of a Participant (i) who is
permanently and totally disabled (as provided in Code Section
415(c)(3)(C), (ii) who is not an eligible Highly Compensated Employee,
and (iii) with respect to whom the Employer elects to have this
paragraph apply, the term Aggregate Compensation for purposes of this
section shall mean the Aggregate Compensation the Participant would
have received for the Plan Year if the Participant had been paid at
the rate of Aggregate Compensation paid immediately before becoming
permanently and totally disabled. This subsection shall apply only if
contributions made with respect to amounts treated as Aggregate
Compensation under this paragraph are nonforfeitable when made.
6. EFFECTIVE JANUARY 1, 1997, SECTION 7.03(j) OF THE PLAN IS AMENDED IN
ITS ENTIRETY TO READ AS FOLLOWS:
7.03 Definitions Applicable to Article 7
* * * * *
(j) Defined Contribution Limit
3
<PAGE> 4
The Defined Contribution Limit for a given Limitation Year is equal to
the lesser of (1) the Defined Contribution Compensation Limit, which
is 25% of Aggregate Compensation applicable to the Limitation Year, or
(2) the Defined Contribution Dollar Limit, which is $30,000. If a
short Limitation Year is created because of an amendment changing the
Limitation Year to a different 12 consecutive month period, the
Defined Contribution Dollar Limit is multiplied by a fraction, the
numerator of which is equal to the number of months in the short
Limitation Year and the denominator of which is 12.
7. EFFECTIVE JANUARY 1, 1997, ARTICLE 11 IS AMENDED BY ADDING SECTION
11.17 TO READ AS FOLLOWS:
11.17 Special Rules Concerning Trustee Responsibilities
Notwithstanding the foregoing sections of this Article 11, the
following provisions regarding the investment of Plan assets and the
Trustee's duties and responsibilities thereto shall override any Plan
provision to the contrary:
(a) Investments.
1. Notwithstanding the provisions of Section 11.04
above, except as provided below, the Plan
Administrator shall have all power over and
responsibility for the management, disposition, and
investment of the Trust assets, and the Trustee
shall comply with proper written directions of the
Plan Administrator concerning those assets. Except
to the extent required by ERISA, the Trustee shall
have no duty or responsibility to review, initiate
action, or make recommendations regarding Trust
assets and shall retain assets until directed in
writing by the Plan Administrator to dispose of
them.
A. As permitted under the Plan, each
Participant and/or beneficiary may have
investment power over the account
maintained for him or her, and may direct
the investment and reinvestment of assets
of the account among the options authorized
by the Plan Administrator. The Trustee
shall have no duty or responsibility to
review or make recommendations regarding
investments made at the direction of the
Plan Administrator or Participant and shall
be required to act only upon receipt of
proper written directions.
B. As permitted under the Plan, the Plan
Administrator may appoint an investment
manager or managers within the meaning of
section 3(38) of ERISA to direct, control
or manage the investment of all or a
portion of the Trust assets, as provided in
sections 3(38) and 403(a)(2) of ERISA.
2. In its administration of the Trust Fund, the Trustee
shall have and exercise whatever powers are
necessary to discharge its obligations and exercise
its rights under the Trust Agreement. Subject to the
direction of the Plan Administrator, or the person
authorized to make investment decisions (the
"Authorized Person"), the Trustee shall have full
power and authority with respect to property held in
the Trust Fund to exercise all such rights and
privileges, including, without limitation, the
following:
A. To deposit securities in a security
depository and permit the securities so
deposited to be held in the name of the
depository's nominee, and to deposit
securities issued or guaranteed by the U.S.
Government or any agency or instrumentality
thereof, including securities evidenced by
book entry rather than by certificate, with
the U.S. Department of the Treasury, a
Federal Reserve Bank or other appropriate
custodial entity, in the same account as
the Trustee's own property, provided the
Trustee's records and accounts show that
such securities are assets of the Trust
Fund;
4
<PAGE> 5
B. To deliver to the Administrator, or the
person or persons identified by the
Administrator, proxies and powers of
attorney and related informational
material, for any shares or other property
held including Employer Securities in the
Trust. Subject to the provisions of Section
11.17(a)(2)(C), the Administrator shall
have responsibility for instructing the
Trustee as to voting such shares and the
tendering of such shares, by proxy or in
person, except to the extent such
responsibility is delegated to another
person, under the terms of the Plan or
Trust Agreement or under an agreement
between the named fiduciary of the Plan and
an investment manager, in which case such
persons shall have such responsibility. The
Trustee may use agents to effect such
delivery to the Administrator or the person
or persons identified by the Administrator.
In no event shall the Trustee be
responsible for the voting or tendering of
shares of securities held in the Trust or
for ascertaining or monitoring whether, or
how, proxies are voted or whether the
proper number of proxies is received.
C. In addition to the provisions of Section
12.01(e) of the Plan, all voting rights
with respect to shares of Company Stock
held in the Trust Fund and allocated to
Participants' Accounts shall be exercised
by the Trustee in such manner as may be
directed by the respective Participant
(which term, for purposes of this
subsection C, shall include the beneficiary
of a deceased Participant and any alternate
payee for whom an account has been
established with an interest in Company
Stock). Any shares of Company Stock in the
Trust Fund that are allocated to
Participants who fail to give directions to
the Trustee shall be voted by the Trustee
in the same proportion as the Shares for
which voting instructions have been
received, subject to the power of the
Administrator to direct the Trustee to vote
such shares in a different manner, if the
Administrator determines that such action
is consistent with its fiduciary
obligations under ERISA. The Administrator
may establish such rules and guidelines as
it deems necessary to properly effect the
provisions of this section;
D. In addition to the provisions of Section
11.04(h) of the Plan, to register Trust
Fund property in the Trustee's own name, in
the name of a nominee or in bearer form,
provided the Trustee's records and accounts
show that such property is an asset of the
Trust Fund;
(b) Settlement of Accounts. In addition to the provisions of
Section 11.08 of the Plan, the Trustee's account shall be
deemed approved upon receipt by the Trustee of the Employer's
written approval of the account or upon the passage of the
sixty day period of time after receipt by the Employer,
except for any matters covered by written objections that
have been delivered to the Trustee by the Employer and for
which the Trustee has not given an explanation or made an
adjustment satisfactory to the Employer.
(c) Company Stock. In addition to the provisions of Section 12.01
of the Plan:
1. No assets of the Trust Fund shall be invested in the
securities of the Employer or its affiliates unless
the Administrator determines that the securities are
exempt from registration under the federal
Securities Act of 1933, as amended, and are exempt
from registration or qualification under the
applicable state law, and of any other applicable
blue sky law, or in the alternative, that the
securities have been so registered and/or qualified.
The Administrator shall also specify what
restrictive legend on transfer, if any, is required
to be set forth on the certificates for the
securities and the procedure to be followed by the
Trustee to effectuate a resale of such securities.
The Administrator shall not direct the investment in
"employer securities" or "employer real property",
within the meaning of section 407 of ERISA, if such
investment
5
<PAGE> 6
would be prohibited by ERISA. The Administrator
shall only direct the investment of Trust funds into
securities of the Employer or an affiliate (i) if
those securities are traded on an exchange
permitting a readily ascertainable fair market
value, or (ii) if the Administrator shall have
obtained a current valuation by a qualified
independent appraiser.
2. The Employer represents and warrants that it will
take all responsibility (and hereby assumes all
liability for the failure) to notify Participants of
any limitations on investment directions necessary
or appropriate to comply with federal securities
laws (including the Exchange Act and the 1933 Act),
including but not limited to the frequency of
investment changes by certain officers and
shareholder-employees pursuant to Section 16(a) and
the volume of trading in Company Stock pursuant to
Rule l0b-6. Consequently the Trustee shall have no
liability to a Participant, and beneficiary, or the
Employer for carrying out instructions relating to
the acquisition or disposition of Company Stock
regardless of whether those instructions subject
such person or the Employer to any liability.
The Employer represents and warrants that either the
percentage of the issued and outstanding class of
equity security registered under section 12 of the
Exchange Act which is Company Stock owned by the
Plan (the "Plan Percentage") is less than 4.5% or
that the Plan and its prior trust have complied with
all notice and filing requirements imposed by
federal securities laws with regard to Company
Stock. The Employer covenants that it will (a)
notify the Trustee in writing within 5 business days
following any date as of which the Plan Percentage
equals or exceeds 4.5%, (b) monitor the Plan
Percentage on a daily basis so long as the Plan
Percentage is at least 4.5%, (c) notify the Trustee
in writing within 5 business days following any date
as of which the Plan Percentage equals or exceeds 5%
and, if applicable, 10%, and (d) provide monthly
written reports to the Trustee disclosing the Plan
Percentage. The foregoing monitoring and
notification requirements shall cease during any
month when the Plan Percentage is below 4.5% for
each day of the month. The provisions of this
Section shall survive the termination of this Trust
Agreement.
3. The election to purchase stock from a participant as
described in Section 12.05 of the Plan and Trust,
shall be the exclusive right and option of the Plan
Administrator and the Trustee shall be responsible
only for following the directions of the Plan
Administrator.
(d) Resignation or Removal of Trustee. Notwithstanding the
provisions of Section 11.14, if either party has given notice
of Trustee removal or resignation as provided under Section
11.14 above, and upon the expiration of the advance notice
period no other successor Trustee has been appointed and has
accepted such appointment, this provision shall serve as (i)
notice of appointment of the Chief Executive Officer of the
Employer as Trustee and (ii) as acceptance by that person of
that appointment.
(e) Applicable Law. Notwithstanding the provisions of Section
8.04, the Trust will be administered in the State of
California, and its validity, construction, and all rights
hereunder shall be governed by ERISA and, to the extent not
preempted, by the laws of California. If any provision of
this Agreement shall be invalid or unenforceable, the
remaining provisions shall continue to be fully effective.
6
<PAGE> 7
IN WITNESS WHEREOF, this instrument has been executed by the duly
authorized and empowered officer of the Employer, this 1st day of July, 1999.
EMPLOYER:
CHEMFIRST INC.
By: /s/ William B. Kemp
------------------------------
William B. Kemp
Vice President
TRUSTEE:
CHARLES SCHWAB TRUST COMPANY
By: /s/ K. Mason
------------------------------
7
<PAGE> 1
EXHIBIT 23.1
The Board of Directors
ChemFirst Inc.:
We consent to the use of our reports incorporated herein by reference.
/s/ KPMG Peat Marwick LLP
KPMG Peat Marwick LLP
Jackson, Mississippi
July 27, 1999
