<PAGE>
<PAGE>
As filed with the Securities and Exchange Commission
on February 19, 1997
Registration No. 333-_____
_________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________________
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
_____________________________________________
NEWSOUTH BANCORP, INC.
- ---------------------------------------------------------------
(Exact name of Registrant as Specified in Its Charter)
Delaware 56-1999749
- ---------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1311 Carolina Avenue, P.O. Box 2047
Washington, North Carolina 27889
(919) 946-4178
- -----------------------------------------------------------------
(Address of Principal Executive Offices)
Home Savings Bank, SSB
Employee's Savings and Profit Sharing Plan and Trust
- -----------------------------------------------------------------
(Full Title of the Plan)
J. Mark Poerio, Esquire
Joel E. Rappoport, Esquire
Housley Kantarian & Bronstein, P.C.
1220 19th Street N.W., Suite 700
Washington, D.C. 20036
- -----------------------------------------------------------------
(Name and Address of Agent For Service)
(202) 822-9611
- -----------------------------------------------------------------
(Telephone number, including area code, of agent for service)
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
====================================================================================
<S> <C> <C> <C> <C>
Title of Proposed Maximum Proposed Maximum Amount of
Securities to Amount to be Offering Price Aggregate Offering Registration
be registered(1) registered(2) Per Share(3) Price(4) Fee
- ------------------------------------------------------------------------------------
Common Stock, $.01
par value per share 30,493 $15.00 $457,400 $138.61
=====================================================================================
<FN>
(1) In addition, pursuant to Rule 416(c) under the Securities
Act of 1933, this registration statement also covers an
indeterminate amount of interests available pursuant to Financial
Institutions Thrift Plan as adopted by Home Savings Bank, SSB (to
be renamed as the Home Savings Bank, SSB Employees' Savings and
Profit Sharing Plan and Trust, effective March 1, 1997) (the
"Plan") as described herein.
(2) Estimates the maximum number of shares expected to be
issued under the Plan assuming that all employer and employee
contributions to the Plan are used to purchase shares of Common
Stock of NewSouth Bancorp, Inc. in the conversion of Home Savings
Bank, SSB from mutual to stock form ("Conversion"), together with
an indeterminate number of shares which may be necessary to
adjust the number of additional shares of Common Stock reserved
for issuance pursuant to the Plan and being registered herein, as
the result of a stock split, stock dividend, reclassification,
recapitalization or similar adjustment(s) of the Common Stock of
NewSouth Bancorp, Inc.
(3) Estimated solely for the purpose of calculating the
registration fee and calculated pursuant to Rule 457(c) based on
maximum subscription price of $15.00 per share of the Common
Stock of NewSouth Bancorp, Inc., as currently offered in the
Conversion.
(4) Estimated based on (2) and (3) above.
</FN>
</TABLE>
THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE AUTOMATICALLY
UPON THE DATE OF FILING, IN ACCORDANCE WITH SECTION 8(A) OF THE
SECURITIES ACT OF 1933.<PAGE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION*
- ------
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL
- ------- INFORMATION*
*This Registration Statement relates to the registration of
30,493 shares of Common Stock, $.01 par value per share, of
NewSouth Bancorp, Inc. (the "Company") reserved for issuance and
delivery under the Home Savings Bank, SSB Employees' Savings and
Profit Sharing Plan and Trust (the "Plan"). Documents containing
the information required by Part I of this Registration Statement
will be sent or given to participants in the Plan as specified by
Rule 428(b)(1). Such documents are not filed with the Securities
and Exchange Commission (the "Commission") either as part of this
Registration Statement or as prospectuses or prospectus
supplements pursuant to Rule 424, in reliance on Rule 428.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
- ------
The Company became subject to the informational requirements
of the Securities Exchange Act of 1934 (the "1934 Act") on
February 11, 1997 and, accordingly, will be filing periodic
reports and other information with the Commission. Reports,
proxy statements and other information concerning the Company
filed with the Commission may be inspected and copies may be
obtained (at prescribed rates) at the Commission's Public
Reference Section, Room 1024, 450 Fifth Street, N.W., Washington,
D.C. 20549.
The following document filed by the Company is incorporated
in this Registration Statement by reference: the Prospectus for
the Common Stock, included in the Company's Registration
Statement (Commission File No. 333-16335)
ALL DOCUMENTS FILED BY THE COMPANY AND THE PLAN PURSUANT TO
SECTIONS 13(A), 13(C), 14, AND 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934, AS AMENDED, AFTER THE DATE HEREOF AND 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 A PART HEREOF FROM THE DATE OF FILING OF SUCH DOCUMENTS.
ITEM 4. DESCRIPTION OF SECURITIES
- ------
The information required by Item 202 of Regulation S-K is
set forth in the description of the Common Stock included in the
Prospectus for the Common Stock (dated February 11, 1997), as
incorporated by reference under Item 3 hereof, such description
being incorporated by reference herein.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
- ------
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS OF THE COMPANY
- ------
Directors, officers and employees of the Company may be
entitled to benefit from the indemnification provisions contained
in the Delaware General Corporation Law (the "DGCL") and the
Company's Certificate of Incorporation. The general effect of
these provisions is summarized below:
<PAGE>
<PAGE>
DELAWARE GENERAL CORPORATION LAW
- --------------------------------
Section 145 of the DGCL permits a Delaware corporation to
indemnify any person who was or is a party or is threatened to be
made a party to any proceeding of any type, (other than an action
by or in the right of the corporation) by reason of the fact that
he is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and
reasonably incurred by him in connection with such action, suit
or proceeding if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests
of the corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his conduct was
unlawful. The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of nolo
contendere or its equivalent, may not, of itself, create a
presumption that these standards have not been met.
A Delaware corporation may also indemnify any person who was
or is a party or is threatened to be made a party to any
proceeding by or in the right of the corporation by reason of the
fact that he is or was a director, officer, employee or agent of
the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other
enterprise against expenses (including attorneys' fees) actually
and reasonably incurred by him in connection with the defense or
settlement of such action or suit if he acted in good faith and
in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation. However, no indemnification
may be made in respect of any claim, issue or matter as to which
such person shall have been adjudged to be liable to the
corporation unless and only to the extent that the Court of
Chancery or the court in which such action or suit was brought
determines upon application that such person is fairly and
reasonably entitled to be indemnified.
To the extent that a director, officer, employee or agent of
a corporation has been successful on the merits or otherwise in
defense of any proceeding described above indemnification against
expenses (including attorneys' fees) actually and reasonably
incurred by him is mandatory.
Any determination that indemnification of the director,
officer, employee or agent is proper in the circumstances because
he has met the applicable standard of conduct set forth in
subsections (a) and (b) must be made by a majority of the board
of directors by a majority vote of a quorum consisting of
directors who were not parties to such action, suit or
proceeding, or if such a quorum is not obtainable, or, even if
obtainable a quorum of disinterested directors so directs, by
independent legal counsel in a written opinion, or by the
stockholders.
Expenses (including attorneys' fees) incurred by an officer
or director in defending any civil, criminal, administrative or
investigative action, suit or proceeding may be paid by the
corporation in advance of the final disposition of or proceeding
upon receipt of an undertaking by or on behalf of such director
or officer to repay such amount if it shall ultimately be
determined that he is not entitled to be indemnified by the
corporation.
The indemnification and advancement of expenses provided by,
or granted pursuant to, the other subsections of this section is
not exclusive.
In addition, a corporation shall have power to purchase and
maintain insurance against any liability of individuals whom the
corporation is required to indemnify.
Article XVII of the Company's Certificate of Incorporation
sets forth circumstances under which directors, officers,
employees and agents may be insured or indemnified against
liability which they may incur in their capacities as such.
ARTICLE XVII
INDEMNIFICATION
A. Persons. The Corporation shall indemnify, to the
extent provided in paragraphs B, D or F:
(1) any person who is or was a director, officer,
employee, or agent of the Corporation; and
<PAGE>
<PAGE>
(2) any person who serves or served at the
Corporation's request as a director, officer, employee, agent,
partner or trustee of another corporation, partnership, joint
venture, trust or other enterprise.
B. Extent -- Derivative Suits. In case of a threatened,
pending or completed action or suit by or in the right of the
Corporation against a person named in paragraph A by reason of
his holding a position named in paragraph A, the Corporation
shall indemnify him if he satisfies the standard in paragraph C,
for expenses (including attorneys' fees but excluding amounts
paid in settlement) actually and reasonably incurred by him in
connection with the defense or settlement of the action or suit.
C. Standard -- Derivative Suits. In case of a
threatened, pending or completed action or suit by or in the
right of the Corporation, a person named in paragraph A shall be
indemnified only if:
(1) he is successful on the merits or otherwise; or
(2) he acted in good faith in the transaction which
is the subject of the suit or action, and in a manner he
reasonably believed to be in, or not opposed to, the best
interests of the Corporation, including, but not limited to,
the taking of any and all actions in connection with the
Corporation's response to any tender offer or any offer or
proposal of another party to engage in a Business
Combination (as defined in Article XV) not approved by the
board of directors. However, he shall not be indemnified in
respect of any claim, issue or matter as to which he has
been adjudged liable to the Corporation unless and only to
the extent that the court in which the suit was brought
shall determine, upon application, that despite the
adjudication but in view of all the circumstances, he is
fairly and reasonably entitled to indemnity for such
expenses as the court shall deem proper.
D. Extent -- Nonderivative Suits. In case of a
threatened, pending or completed suit, action or proceeding
(whether civil, criminal, administrative or investigative), other
than a suit by or in the right of the Corporation, together
hereafter referred to as a nonderivative suit, against a person
named in paragraph A by reason of his holding a position named in
paragraph A, the Corporation shall indemnify him if he satisfies
the standard in paragraph E, for amounts actually and reasonably
incurred by him in connection with the defense or settlement of
the nonderivative suit, including, but not limited to (i)
expenses (including attorneys' fees), (ii) amounts paid in
settlement, (iii) judgments, and (iv) fines.
E. Standard -- Nonderivative Suits. In case of a
nonderivative suit, a person named in paragraph A shall be
indemnified only if:
(1) he is successful on the merits or otherwise; or
(2) he acted in good faith in the transaction which
is the subject of the nonderivative suit and in a manner he
reasonably believed to be in, or not opposed to, the best
interests of the Corporation, including, but not limited to,
the taking of any and all actions in connection with the
Corporation's response to any tender offer or any offer or
proposal of another party to engage in a Business
Combination (as defined in Article XV) not approved by the
board of directors and, with respect to any criminal action
or proceeding, he had no reasonable cause to believe his
conduct was unlawful. The termination of a nonderivative
suit by judgment, order, settlement, conviction, or upon a
plea of nolo contendere or its equivalent shall not, in
itself, create a presumption that the person failed to
satisfy the standard of this subparagraph E(2).
F. Determination That Standard Has Been Met. A
determination that the standard of paragraph C or E has been
satisfied may be made by a court, or, except as stated in
subparagraph C(2) (second sentence), the determination may be
made by:
(1) the board of directors by a majority vote of a
quorum consisting of directors of the Corporation who were
not parties to the action, suit or proceeding; or
(2) independent legal counsel (appointed by a
majority of the disinterested directors of the Corporation,
whether or not a quorum) in a written opinion; or
(3) the stockholders of the Corporation.
G. Proration. Anyone making a determination under
paragraph F may determine that a person has met the standard as
to some matters but not as to others, and may reasonably prorate
amounts to be indemnified.<PAGE>
<PAGE>
H. Advance Payment. The Corporation shall pay in
advance any expenses (including attorneys' fees) which may become
subject to indemnification under paragraphs A through G if:
(1) the board of directors authorizes the specific
payment; and
(2) the person receiving the payment undertakes in
writing to repay the same if it is ultimately determined
that he is not entitled to indemnification by the
Corporation under paragraphs A through G.
I. Nonexclusive. The indemnification and advance
payment of expenses provided by paragraphs A through H shall not
be exclusive of any other rights to which a person may be
entitled by law, bylaw, agreement, vote of stockholders or
disinterested directors, or otherwise.
J. Continuation. The indemnification provided by this
Article XVII shall be deemed to be a contract between the
Corporation and the persons entitled to indemnification
thereunder, and any repeal or modification of this Article XVII
shall not affect any rights or obligations then existing with
respect to any state of facts then or theretofore existing or any
action, suit or proceeding theretofore or thereafter brought
based in whole or in part upon any such state of facts. The
indemnification and advance payment provided by paragraphs A
through H shall continue as to a person who has ceased to hold a
position named in paragraph A and shall inure to his heirs,
executors and administrators.
K. Insurance. The Corporation may purchase and maintain
insurance on behalf of any person who holds or who has held any
position named in paragraph A, against any liability incurred by
him in any such position, or arising out of his status as such,
whether or not the Corporation would have power to indemnify him
against such liability under paragraphs A through H.
L. Intention and Savings Clause. It is the intention of
this Article XVII to provide for indemnification to the fullest
extent permitted by the General Corporation Law of the State of
Delaware, and this Article XVII shall be interpreted accordingly.
If this Article XVII or any portion hereof shall be invalidated
on any ground by any court of competent jurisdiction, then the
Corporation shall nevertheless indemnify each director, officer,
employee, and agent of the Corporation as to costs, charges, and
expenses (including attorneys' fees), judgments, fines, and
amounts paid in settlement with respect to any action, suit, or
proceeding, whether civil, criminal, administrative, or
investigative, including an action by or in the right of the
Corporation to the full extent permitted by any applicable
portion of this Article XVII that shall not have been invalidated
and to the full extent permitted by applicable law. If the
General Corporation Law of the State of Delaware is amended, or
other Delaware law is enacted, to permit further or additional
indemnification of the persons defined in this Article XVII A,
then the indemnification of such persons shall be to the fullest
extent permitted by the General Corporation Law of the State of
Delaware, as so amended, or such other Delaware law.
INDEMNIFICATION OF DIRECTORS AND OFFICERS OF HOME SAVINGS BANK,
INC., SSB AND NEWSOUTH BANCORP, INC.
The Amended and Restated Certificate of Incorporation of the
Bank provide that, to the fullest extent permitted by the North
Carolina Business Corporation Act (the "NCBCA"), no person who
serves as a director shall be personally liable to the Bank or
any of its stockholders or otherwise for monetary damages for
breach of any duty as director.
In addition, Article IX of the Amended and Restated Bylaws
of the Converted Bank state that any person who at any time
serves or has served as a director or officer of the Bank, or
who, while serving as a director or officer of the Bank, serves
or has served at the request of the Bank as a director, officer,
partner, trustee, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, or as a
trustee or administrator under an employee benefit plan, shall
have a right to be indemnified by the Bank to the fullest extent
permitted by law against (a) reasonable expenses, including
attorneys' fees, incurred by him in connection with any
threatened, pending or completed civil, criminal, administrative,
investigative, or arbitrative action, suit, or proceeding (and
any appeal therein), whether or not brought by or on behalf of
the Bank, seeking to hold him liable by reason of the fact that
he is or was acting in such capacity, and (b) reasonable payments
made by him in satisfaction of any judgment, money decree, fine
(including an excise tax assessed with respect to an employee
benefit plan) or penalty for which he may have become liable in
any such action, suit or proceeding, or in connection with a
settlement approved by the Board of Directors of any such action,
suit or proceeding.
<PAGE>
<PAGE>
Sections 55-8-50 through 55-8-58 of the NCBCA contain
provisions prescribing the extent to which directors and officers
shall or may be indemnified. Section 55-8-51 of the NCBCA
permits a corporation, with certain exceptions, to indemnify a
present or former director against liability if (i) the director
conducted himself in good faith, (ii) the director reasonably
believed (x) that the director's conduct in the director's
official capacity with the corporation was in its best interests
and (y) in all other cases the director's conduct was at least
not opposed to the corporation's best interests, and (iii) in the
case of any criminal proceeding, the director had no reasonable
cause to believe the director's conduct was unlawful. A
corporation may not indemnify 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 a proceeding charging improper personal benefit to the
director. The above standard of conduct is determined by the
board of directors, or a committee or special legal counsel or
the shareholders as prescribed in Section 55-8-55.
Sections 55-8-52 and 55-8-56 of the NCBCA require a
corporation to indemnify a director or officer in the defense of
any proceeding to which the director or officer was a party
against reasonable expenses when the director or officer is
wholly successful in the director's or officer's defense, unless
the articles of incorporation provide otherwise. Upon
application, the court may order indemnification of the director
or officer if the director or officer is adjudged fairly and
reasonably so entitled under Section 55-8-54.
In addition, Section 55-8-57 permits a corporation to
provide for indemnification of directors, officers, employees or
agents, in its articles of incorporation or bylaws or by contract
or resolution, against liability in various proceedings and to
purchase and maintain insurance policies on behalf of these
individuals.
The foregoing is only a general summary of certain aspects
of North Carolina law dealing with indemnification of directors
and officers and does not purport to be complete. It is
qualified in its entirety by reference to the relevant statutes,
which contain detailed specific provisions regarding the
circumstances under which and the person for whose benefit
indemnifications shall or may be made.
The Bank has a directors and officers liability policy
providing for insurance against certain liabilities incurred by
directors and officers of the Bank while serving in their
capacities as such.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
- ------
Not applicable.
ITEM 8. EXHIBITS
- ------
The exhibits schedules filed as a part of this registration
statement are as follows:
4.1 Financial Institutions Thrift Plan as adopted by Home
Savings Bank, SSB (the "Plan")
4.2 Summary Plan Description of the Plan
4.3 Form of Investment Election to be made available to
Plan Participants with respect to the investment of
their accounts under the Plan
5.1 Opinion of Housley Kantarian & Bronstein, P.C. as to
the validity of the Common Stock being registered
5.2 Favorable Determination Letter from the Internal
Revenue Service Dated December 20, 1995, regarding the
tax-qualification of the Plan documents
23.1 Consent of Housley Kantarian & Bronstein, P.C.
(appears in their opinion filed as Exhibit 5.1)
23.2 Consent of Independent Certified Public Accountants
24 Power of Attorney (contained in the signature page to
this Registration Statement)
99.1 Copy of the Plan's most recent Annual Report, as filed
with the Internal Revenue Service on Form 5500
<PAGE>
<PAGE>
ITEM 9. UNDERTAKINGS
- ------
1. The undersigned Registrant hereby undertakes:
(a) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement to include any material
information with respect to the plan of distribution not
previously disclosed in the registration statement or
any material change to such information in the
registration statement.
(b) That, for the purpose of determining any
liability under the Securities Act of 1933, to treat
each such post-effective amendment as a new registration
statement relating to the securities offered therein,
and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(c) 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.
2. The undersigned Registrant hereby undertakes that,
for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report
pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
3. The undersigned Registrant hereby undertakes to
deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest annual
report to security holders that is incorporated by reference in
the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities
Exchange Act of 1934; and, where interim financial information
required to be presented by Article 3 of Regulation S-X are not
set forth in the prospectus, to deliver, or cause to be delivered
to each person to whom the prospectus is sent or given, the
latest quarterly report that is specifically incorporated by
reference in the prospectus to provide such interim financial
information.
4. Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the Registrant pursuant to
the foregoing provisions, or otherwise, the Registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the Registrant of expenses incurred or
paid by a director, officer or controlling person of the
Registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
as amended, the Registrant certifies that it has reasonable
grounds to believe that it meets all of the requirements for
filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Washington, State of
North Carolina, on February 18, 1997.
NEWSOUTH BANCORP, INC.
By: /s/ Thomas A. Vann
--------------------------
Thomas A. Vann, President
(Duly Authorized
Representative)
POWER OF ATTORNEY
We, the undersigned Directors of NewSouth Bancorp, Inc.,
hereby severally constitute and appoint Thomas A. Vann, with full
power of substitution, our true and lawful attorney and agent, to
do any and all things in our names in the capacities indicated
below which said Thomas A. Vann may deem necessary or advisable
to enable NewSouth Bancorp, Inc. to comply with the Securities
Act of 1933, as amended, and any rules, regulations and
requirements of the Securities and Exchange Commission, in
connection with the registration of NewSouth Bancorp, Inc. common
stock, including specifically, but not limited to, power and
authority to sign for us in our names in the capacities indicated
below, the Registration Statement and any and all amendments
(including post-effective amendments) thereto; and we hereby
ratify and confirm all that said Thomas A. Vann shall do or cause
to be done by virtue thereof.
Pursuant to the requirements of the Securities Act of 1933,
as amended, this Registration Statement has been signed by the
following persons in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signatures Title Date
- ---------- ----- -----
<S> <C> <C>
/s/ Thomas A. Vann President and Director February 18, 1997
- ---------------------- (Principal Executive Officer)
Thomas A. Vann
/s/ William L. Wall Executive Vice President and February 18, 1997
- --------------------- Chief Operating Officer
William L. Wall (Principal Financial and
Accounting Officer)
/s/ Edmund T. Buckman, Jr. Director February 18, 1997
- --------------------------
Edmund T. Buckman, Jr.
/s/ Linley H. Gibbs, Jr. Director February 18, 1997
- ------------------------
Linley H. Gibbs, Jr.
/s/ Frederick N. Holscher Director February 18, 1997
- -------------------------
Frederick N. Holscher
/s/ Frederick H. Howdy Director February 18, 1997
- ----------------------
Frederick H. Howdy
- ---------------------- Director ________ __, 1997
Charles E. Parker, Jr.
/s/ Marshall T. Singleton Director February 18, 1997
- -------------------------
Marshall T. Singleton
/TABLE
<PAGE>
<PAGE>
Pursuant to the requirements of the Securities Act of 1933,
the undersigned trustee of the Home Savings Bank, SSB Employees'
Savings and Profit Sharing Plan and Trust has duly caused this
registration statement to be signed in the City of Washington,
State of North Carolina, on February 18, 1997.
Thomas A. Vann, As Trustee of the Common Stock Fund
under the Home Savings Bank, SSB Employees' Savings and
Profit Sharing Plan and Trust
By: /s/ Thomas A. Vann
---------------------------------
<PAGE>
FINANCIAL INSTITUTIONS
THRIFT PLAN
14th Revision, Effective July 1, 1993
108 Corporate Park Drive P.O. Box 847 White Plains, N.Y. 10604
<PAGE>
<PAGE>
A tax-exempt, trusteed savings plan
established July 1, 1970
in order that eligible employees
of financial institutions and other organizations serving them
may save and invest on a regular, long term basis.
<PAGE>
<PAGE>
TABLE OF CONTENTS
PURPOSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
ARTICLE I DEFINITIONS. . . . . . . . . . . . . . . . . . . . . 1
ARTICLE II PARTICIPATION AND MEMBERSHIP. . . . . . . . . . . . 9
Section 1 Employer Participation. . . . . . . . . . . . . 9
Section 2 Employee Membership . . . . . . . . . . . . . . 9
ARTICLE III CONTRIBUTIONS. . . . . . . . . . . . . . . . . . . 13
Section 1 Contributions by Members. . . . . . . . . . . . 13
Section 2 Regular Contributions by Employer . . . . . . . 13
Section 3 Supplemental Contributions by Employer. . . . . 15
Section 4 401(k) Features . . . . . . . . . . . . . . . . 16
Section 5 Remittance of Contributions . . . . . . . . . . 23
Section 6 Transfer of Funds and Rollover Contributions. . 23
Section 7 Limitations on Member Contributions
and Matching Employer Contributions. . . . . . . . . . 27
Section 8 Profit Sharing Feature. . . . . . . . . . . . . 29
ARTICLE IV INVESTMENT OF CONTRIBUTIONS . . . . . . . . . . . . 35
ARTICLE V MEMBERS' ACCOUNTS, UNITS AND VALUATION . . . . . . . 38
ARTICLE VI VESTING OF UNITS. . . . . . . . . . . . . . . . . . 39
Section 1 Vesting . . . . . . . . . . . . . . . . . . . . 39
Section 2 Forfeitures . . . . . . . . . . . . . . . . . . 41
ARTICLE VII WITHDRAWAL PAYMENTS. . . . . . . . . . . . . . . . 43
Section 1 General . . . . . . . . . . . . . . . . . . . . 43
Section 2 Account Withdrawal While Employed . . . . . . . 44
Section 3 Account Withdrawal Upon Termination of
Employment or Employer Participation . . . . . . . 44
Section 4 Account Withdrawal Upon Member's
Disability. . . . . . . . . . . . . . . . . . . . . . . 48
Section 5 Member's Death. . . . . . . . . . . . . . . . . 49
ARTICLE VIII LOAN PROGRAM. . . . . . . . . . . . . . . . . . . 51
Section 1 General . . . . . . . . . . . . . . . . . . . . 51
Section 2 Loan Application. . . . . . . . . . . . . . . . 51
Section 3 Permitted Loan Amount . . . . . . . . . . . . . 52
Section 4 Source of Funds for Loan. . . . . . . . . . . . 53
Section 5 Conditions of Loan. . . . . . . . . . . . . . . 53
Section 6 Crediting of Repayment. . . . . . . . . . . . . 54
Section 7 Cessation of Payments on Loan . . . . . . . . . 54
Section 8 Loans to Former Members and Beneficiaries . . . 55
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ARTICLE IX ADMINISTRATION OF PLAN. . . . . . . . . . . . . . . 56
Section 1 Board of Directors. . . . . . . . . . . . . . . 56
Section 2 Trust Agreement . . . . . . . . . . . . . . . . 58
ARTICLE X MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . . 59
Section 1 General Limitations . . . . . . . . . . . . . . 59
Section 2 Top Heavy Provisions. . . . . . . . . . . . . . 61
Section 3 Information and Communications. . . . . . . . . 63
Section 4 Small Account Balances. . . . . . . . . . . . . 64
Section 5 Amounts Payable to Incompetents,
Minors or Estates. . . . . . . . . . . . 64
Section 6 Non-alienation of Amounts Payable . . . . . . . 64
Section 7 Unclaimed Amounts Payable . . . . . . . . . . . 65
Section 8 Leaves of Absence . . . . . . . . . . . . . . . 65
Section 9 Return of Contributions to Employer . . . . . . 66
Section 10 Controlling Law. . . . . . . . . . . . . . . . 66
ARTICLE XI TERMINATION OF EMPLOYER PARTICIPATION . . . . . . . 67
Section 1 Termination by Employer . . . . . . . . . . . . 67
Section 2 Termination by Board. . . . . . . . . . . . . . 67
Section 3 Termination Distribution. . . . . . . . . . . . 67
ARTICLE XII AMENDMENT OR TERMINATION OF THE PLAN AND
TRUST . . . . . . . . . . . . . . . . . . . . . . . . . . . 70
TRUSTS ESTABLISHED UNDER THE PLAN. . . . . . . . . . . . . . . 72
APPENDIX A . . . . . . . . . . . . . . . . . . . . . . . . . . 73
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PURPOSE
The purpose of the Financial Institutions Thrift Plan (the
"Plan") is to provide Members of participating Employers with a
convenient way to save on a regular and long-term basis and, in
addition to, or in lieu of such benefit, a benefit under a Profit
Sharing Feature, all as elected by the Employer, and as set forth
herein and in the Trust Agreement adopted as a part of this Plan.
This Plan, as hereby amended and restated, and the Trust
established hereunder, are intended to qualify as a plan and
trust which meet the requirements of Sections 401(a), 401(k), and
501(a), respectively, of the Internal Revenue Code of 1986, as
now in effect or hereafter amended, or any other applicable
provisions of law including, without limitation, the Employee
Retirement Income Security Act of 1974, as amended.
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ARTICLE I
DEFINITIONS
The following words and phrases as used in this Plan shall
have the following meanings:
1. "ACCOUNT" means the Plan account established and maintained
in respect of each Member pursuant to Article V, including the
Member's 401(k) Account, Regular Account, Rollover Account
(including Profit Sharing Rollover Amounts) and Profit Sharing
Account.
2. "BASIC AMOUNTS" means, with respect to a Member, the
contributions made on behalf of the Member by the Employer
pursuant to Article III, Section 2(B) and earnings thereon.
3. "BENEFICIARY" means the person or persons designated to
receive any amount payable under the Plan upon the death of a
Member. Such designation may be made or changed only by the
Member on a form provided by, and filed with, the Board prior to
his death. If the Member is not survived by a Spouse and if no
Beneficiary is designated, or if the designated Beneficiary
predeceases the Member, then any such amount payable shall be
paid to such Member's estate upon his death.
4. "BOARD" means the Board of Directors provided for in Article
IX, Section 1.
5. "BREAK IN SERVICE" means a Plan Year during which an
individual has not completed more than 500 Hours of Employment,
as determined by the Board in accordance with the IRS
Regulations. Solely for purposes of determining whether a Break
in Service has occurred, an individual shall be credited with the
Hours of Employment which such individual would have completed
but for a maternity or paternity absence, as determined by the
Board in accordance with this Article I, Paragraph (5), the Code
and the applicable regulations issued by the DOL and the IRS;
provided, however, that the total Hours of Employment so credited
shall not exceed 501 and the individual timely provides the Board
with such information as it may require. Hours of Employment
credited for a maternity or paternity absence shall be credited
entirely (i) in the Plan Year in which the absence began if such
hours of Employment are necessary to prevent a Break in Service
in such year, or (ii) in the following Plan Year. For purposes of
this Article I, Paragraph (5) maternity or paternity absence
shall mean an absence from work by reason of the individual's
pregnancy, the birth of the individual's child or the placement
of a child with the individual in connection with the adoption of
the child by such individual, or for purposes of caring for a
child for the period immediately following such birth or
placement.
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6. "CODE" means the Internal Revenue Code of 1986, as now in
effect or as hereafter amended. All citations to sections of the
Code are to such sections as they may from time to time be
amended or renumbered.
7. "COMMENCEMENT DATE" means the date on which an Employer
begins to participate in the Plan.
8. "CONTRIBUTION DETERMINATION PERIOD" means the Plan Year,
fiscal year, or calendar or fiscal quarter, as elected by an
Employer, upon which eligibility for and the maximum permissible
amount of any contribution to the Profit Sharing Feature, as
defined in Article III, Section 8, is determined. Notwithstanding
the foregoing, for purposes of Article VI, Section 2(B)(2),
Contribution Determination Period means the Plan Year.
9. "DISABILITY" means a Member's disability as defined in
Article VII, Section 4.
10. "DOL" means the United States Department of Labor.
11. "EMPLOYEE" means any person in the Employment of, and who
receives a salary from, an Employer, and any leased employee
within the meaning of Section 414(n)(2) of the Code, but
excluding, at the election of the Employer, any employee not paid
on a salaried basis provided the Employer continues to satisfy
the applicable Code Section 410(b) coverage test following such
exclusion. Notwithstanding the foregoing, if such leased
employees constitute less than twenty percent (20%) of the
Employer's nonhighly compensated workforce within the meaning of
Section 414(n)(5)(C)(ii) of the Code, such leased employees are
not Employees if they are covered by a plan meeting the
requirements of Section 414(n)(5)(B) of the Code. A director of
the Employer is not eligible to participate in the Plan unless he
is also an Employee.
12. "EMPLOYER" means any entity which has adopted the Plan in
accordance with Article II, Section 1.
13. "EMPLOYMENT" means all periods of service with an Employer
commencing with the Employee's first day of employment or
reemployment and ending on the date a break in service begins.
The first day of employment or reemployment is the first day the
Employee performs an hour of service. An Employee will also
receive credit for any period of severance of less than 12
consecutive months. Fractional periods of a year will be
expressed in terms of days.
For purposes of this Section (13), hour of service shall mean
each hour for which an Employee is paid or entitled to payment
for the performance of duties for an Employer.
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Break in service is a period of severance of at least 12
consecutive months.
Period of severance is a continuous period of time during which
the Employee is not employed by an Employer. Such period begins
on the date the Employee retires, quits or is discharged, or if
earlier, the 12 month anniversary of the date on which the
Employee was otherwise first absent from service.
If an Employer is a member of an affiliated service group (under
Section 414(m) of the Code), a controlled group of corporations
(under Section 414(b) of the Code), a group of trades or
businesses (under Section 414(c) of the Code), or any other
entity required to be aggregated with the Employer pursuant to
section 414(o) of the Code, service will be credited for any
employment for any period of time for any other member of such
group. Service will also be credited for any individual required
under section 414(n) or section 414(o) to be considered an
employee of any Employer aggregated under section 414(b), (c), or
(m).
In the case of an Employee who is absent from work for maternity
or paternity reasons, the 12-consecutive month period beginning
on the first anniversary of the first date of such absence shall
not constitute a break in service. For purposes of this
paragraph, an absence from work for maternity or paternity
reasons means an absence (1) by reason of the pregnancy of the
Employee, (2) by reason of the birth of a child of the Employee,
(3) by reason of the placement of a child with the Employee in
connection with the adoption of such child by such Employee, or
(4) for purposes of caring for such child for a period beginning
immediately following such birth or placement.
Solely for purposes of determining vesting, "Employment" shall
include service performed by an individual for an Employer or
members of an affiliated service group (under Code Section
414(m)), a controlled group of corporations (under Code Section
414(b)), or a group of trades or businesses under common control
(under Code Section 414(c)), of which the Employer is a member,
during the period such individual is not a member of a class of
Employees otherwise eligible to participate in the Plan.
14. "ENROLLMENT DATE" means the date on which an Employee
becomes a Member as provided under Article II, Section 2.
15. "ERISA" means the Employee Retirement Income Security Act of
1974, as now in effect or as hereafter amended.
16. "401(k) ACCOUNT" means the Plan account established and
maintained in respect of a Member pursuant to Article III,
Section 4 and Article V, and shall include all amounts (and
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earnings thereon) credited thereto on behalf of the Member
pursuant to the provisions of Article III.
17. "HIGHLY COMPENSATED EMPLOYEE" or "HIGHLY COMPENSATED MEMBER"
means an Employee or Member who is employed during the
determination year and who during the look-back year: (i)
received compensation from the Employer in excess of $75,000 (as
adjusted pursuant to Section 415(d) of the Code); or (ii)
received compensation from the Employer in excess of $50,000 (as
adjusted pursuant to Section 415(d) of the Code) and was a member
of the top-paid group as defined in Section 414(q) of the Code
for such year; or (iii) was an officer of the Employer and
received compensation during such year that is greater than 50
percent of the dollar limitation in effect under Section
415(b)(1)(A) of the Code. The term Highly Compensated Employee
also includes: (i) employees who are both described in the
preceding sentence if the term "determination year" is
substituted for the term "look-back year" and the employee is one
of the 100 employees who received the most compensation from the
Employer during the determination year; and (ii) employees who
are 5 percent owners at any time during the look-back year or
determination year.
If no officer has satisfied the compensation requirement of (iii)
above during either a determination year or look-back year, the
highest paid officer for such year shall be treated as a Highly
Compensated Employee.
For this purpose, the determination year shall be the Plan Year.
The look-back year shall be the twelve-month period immediately
preceding the determination year.
If an Employee is, during a determination year or look-back year,
a family member of either a 5 percent owner who is an active or
former Employee or a Highly Compensated Employee who is one of
the 10 most highly compensated Employees ranked on the basis of
compensation paid by the Employer during such year, then the
family member and the 5 percent owner or top-ten Highly
Compensated Employee shall be aggregated. In such case, the
family member and 5 percent owner or top-ten Highly Compensated
Employee shall be treated as a single Employee receiving
compensation and plan contributions or benefits equal to the sum
of such compensation and contributions or benefits of the family
member and 5 percent owner or top-ten Highly Compensated
Employee. For purposes of this Paragraph, family member includes
the spouse, lineal ascendants and descendants of the Employee or
former Employee and the spouses of such lineal ascendants and
descendants.
The determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of
Employees in the top-paid group, the top 100 Employees, the
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number of Employees treated as officers and the compensation that
is considered, will be made in accordance with Section 414(q) of
the Code and the IRS Regulations thereunder.
18. "HOUR OF EMPLOYMENT" means
(A) Each hour for which an Employee is paid, or entitled to
payment, for the performance of duties for an Employer. These
hours will be credited to the Employee for the computation period
in which the duties are performed; and
(B) Each hour for which an Employee is paid, or entitled to
payment, by an 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
Employment will be credited under this Subsection (B) for any
single continuous period (whether or not such period occurs in a
single computation period). Hours under this Subsection (B) will
be calculated and credited pursuant to Section 2530.200b-2 of the
DOL Regulations which is 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 an Employer. The
same Hours of Employment will not be credited both under
Subsection (A) or (B), as the case may be, and under this
Subsection (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 Employment will be credited for employment with
other members of an affiliated service group (under Code Section
414(m)), a controlled group of corporations (under Code Section
414(b)), or a group of trades or businesses under common control
(under Code Section 414(c)), of which the Employer is a member,
and any other entity required to be aggregated with such Employer
pursuant to Code Section 414(o).
Hours of Employment will also be credited for any individual
considered an Employee for purposes of the Plan under Code
Section 414(n) or Section 414(o).
Solely for purposes of determining eligibility to
participate, "Hour of Employment" shall include service performed
by an individual for an Employer or members of an affiliated
service group (under Code Section 414(m)), a controlled group of
corporations (under Code Section 414(b)), or a group of trades or
businesses under common control (under Code Section 414(c)), of
which the Employer is a member, during the period such individual
is
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not a member of a class of Employees otherwise eligible to
participate in the Plan.
19. "IRS" means the United States Internal Revenue Service.
20. "LEAVE OF ABSENCE" means an absence authorized by an
Employee's Employer on a uniform basis, in accordance with
Article X, Section 8.
21. "MATCHING AMOUNTS" means, with respect to a Member, the
contributions made on behalf of the Member by the Employer
pursuant to Article III, Section 2(A) and earnings thereon.
22. "MEMBER" means an Employee enrolled in the membership of the
Plan under Article II, Section 2. Notwithstanding the foregoing,
Member shall include a former Member, except for purposes of
Article III (other than Section 6 thereof) of the Plan.
23. "MONTH" means any calendar month.
24. "NORMAL RETIREMENT AGE" means the Member's sixty-fifth (65th)
birthday.
25. "PLAN" means the Financial Institutions Thrift Plan
established herein and as from time to time amended.
26. "PLAN YEAR" means a 12-month period ending December 31.
27. "PROFIT SHARING ACCOUNT" means the Plan account established
in respect of each Member pursuant to Article III, Section
8(B)(2) and Article V which shall be maintained separate from any
other Account established in respect of such Member under the
Plan. Except as otherwise indicated under the Plan, a Member's
Profit Sharing Account shall not include his Profit Sharing
Rollover Amounts.
28. "PROFIT SHARING ROLLOVER AMOUNTS" means, with respect to an
Employee or Member whose Employer participates in the Plan solely
under Article III, Section 8 (Profit Sharing Feature), any
amounts (and earnings thereon) transferred or contributed on
behalf of such Employee or Member pursuant to Article III,
Section 6(C).
29. "REGULAR ACCOUNT" means the Plan account established and
maintained in respect of a Member pursuant to Article III,
Section 2(C) and Article V, and shall include all amounts (and
earnings thereon) credited thereto on behalf of the Member
pursuant to the provisions of Article III.
30. "REGULATIONS" means the applicable regulations issued under
the Code, ERISA or other applicable law, by the IRS, the DOL or
any other governmental authority and any proposed or temporary
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regulations or rules promulgated by such authorities pending the
issuance of such regulations.
31. "ROLLOVER ACCOUNT" means the Plan account established in
respect of each Member pursuant to Article III, Section 6(C) and
Article V which shall be maintained separate from any other
Account established in respect of such Member under the Plan. For
purposes of Article III, Section 4(H), Article VII, Sections 1
and 2, and Article VIII, a Member's Rollover Account shall not
include his Profit Sharing Rollover Amounts, unless otherwise
indicated therein.
32. "SALARY" means regular basic monthly salary or wages,
exclusive of special payments such as overtime, bonuses, fees,
deferred compensation (other than amounts deferred pursuant to a
Member's election under Article III, Section 4), severance
payments, and contributions by the Employer under this or any
other plan (other than before-tax contributions made on behalf of
a Member under a Code Section 125 cafeteria plan, unless the
Employer specifically elects to exclude such contributions).
Commissions shall be included at the Employer's option within
such limits, if any, as may be set by the Employer and applied
uniformly to all its commission Employees. In addition, Salary
may also include, at the Employer's option, special payments such
as (i) overtime or (ii) overtime plus bonuses. If an Employer
elects to include the special payments enumerated in (i) or (ii)
above in the definition of Salary (or, if the Employer adopts the
Plan after December 31, 1992 and elects to include commissions in
the definition of Salary), such Salary shall be determined based
on the amounts received by the Member during the relevant
determination period. Otherwise, unless an Employer specifically
requests to include Salary changes received by a Member during
the relevant determination period and is granted permission by
the Board, a Member's monthly Salary rate is one-twelfth of his
annual Salary rate as of each January 1. If commissions are
included in Salary, unless an Employer specifically requests to
include commissions received by a Member during the relevant
determination period and is granted permission by the Board, they
shall be calculated on a uniform basis based on the commissions
received by the Member during the 12-month period prior to the
determination period. As an alternative to the foregoing
definition, at the Employer's option, Salary may be defined to
include total taxable compensation reported on the Member's IRS
Form W-2, plus deferrals, if any, pursuant to Section 401(k) of
the Code and pursuant to Section 125 of the Code (unless the
Employer specifically elects to exclude such Section 125
deferrals), but excluding compensation deferred from previous
years. In no event, may a Member's Salary for any Plan Year
exceed for purposes of the Plan $200,000 or, effective January 1,
1994, $150,000 (adjusted for cost of living to the extent
permitted by the Code and the IRS Regulations).
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In determining the Salary for a Member for purposes of the dollar
limitation described in the preceding sentence, the rules of
Section 414(q)(6) of the Code shall apply, except that in
applying such rules the term "family" shall include only the
spouse of the Member and any lineal descendants of the Member who
have not attained age 19 before the close of the year.
33. "SPOUSE" or "SURVIVING SPOUSE" means the individual to whom a
Member or former Member was married on the date such Member
withdraws his Account, or if such Member has not withdrawn his
Account, the individual to whom the Member or former Member was
married on the date of his death.
34. "SUPPLEMENTAL AMOUNTS" means, with respect to a Member, the
contributions made on behalf of the Member by the Employer
pursuant to Article III, Section 3 and earnings thereon.
35. "TRUSTEE" means the Trustee or Trustees provided for in
Article IX, Section 2.
36. "TRUST FUND" means the Trust Fund or Funds established by the
Trust Agreement or Agreements provided for in Article IX, Section
2.
37. "UNIT" means the unit of measure described in Article V of a
Member's proportionate interest in Investment Funds A, B, C, D
and E.
38. "VALUATION DATE" means the last business day of any month for
the Trustee, except that in the event the underlying portfolios
of any Investment Fund cannot be valued on such date, the
Valuation Date for such Investment Fund shall be the next
subsequent date on which the underlying portfolio(s) can be
valued. Valuations shall be made as of the close of business on
such valuation date(s).
39. "YEAR OF EMPLOYMENT" means a 12-month period of Employment.
40. "YEAR OF SERVICE" means any Plan Year during which an
individual completed at least 1,000 Hours of Employment, or
satisfied any alternative requirement, as determined by the Board
in accordance with any applicable regulations issued by the DOL
and the IRS.
41. The masculine pronoun wherever used shall include the
feminine pronoun.
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ARTICLE II PARTICIPATION AND MEMBERSHIP
SECTION 1. EMPLOYER PARTICIPATION.
Any financial institution, or other organization serving it, may
apply to the Board for participation in the Plan if: (A) as of
its Commencement Date and in accordance with Section 410 (b) of
the Code and the IRS Regulations (i) the percentage of Nonhighly
Compensated Employees who will benefit under the Plan is at least
70% of the percentage of Highly Compensated Employees who will
benefit under the Plan (excluding such employees as are permitted
to be excluded under IRS Regulations), or (ii) the average
benefit percentage test (as defined in Section 410(b)(2) of the
Code and the IRS Regulations) will be satisfied with respect to
the Employer, and (B) as of its Commencement Date and in
accordance with Section 401(a)(26) of the Code and the IRS
Regulations, at least 50 (or, if a lesser number results, 40%) of
the Employer's Employees will benefit under the Plan. The
applicant shall submit the formal application and all required
information, and the Board, in its discretion, shall decide upon
admittance and determine the Commencement Date. The Board may, in
its discretion and at such times as it may determine, require an
affirmative showing by an Employer of its continued compliance
with the requirements of Section 410(b) and Section 401(a)(26) of
the Code and IRS Regulations. Initial and continued participation
shall be subject to the determination of the IRS that the Plan
and the Trust Fund are tax-qualified and tax-exempt under
Sections 401(a) and 501(a) of the Code, respectively. In
addition, any Employee who participated in the Plan but who has
been transferred to a governmental or quasi-governmental agency
serving the financial industry shall, notwithstanding anything to
the contrary in this Section, be permitted to continue to
participate in the Plan; provided that, in such case, such
Employee's employing agency has adopted the Plan.
SECTION 2. EMPLOYEE MEMBERSHIP.
(A) Employer contributions on behalf of any Member shall be
conditioned upon the Member making contributions under Article
III, Section 1, except in the case of the basic contribution
feature described in Article III, Section 2, the supplemental
contribution feature (Formula (2)) described in Article III,
Section 3, the 401(k) Feature described in Article III, Section
4(B) or the Profit Sharing Feature described in Article III,
Section 8.
(B) Every Employee (other than non-salaried Employees who, at
the election of the Employer, are excluded from participation)
shall be eligible for membership in the Plan on the later of:
(1) His Employer's Commencement Date, or
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(2) The first day of the month coincident with or next
following his satisfaction of one or more of the eligibility
requirements described hereunder, as designated by his Employer:
(i) the completion of any number of months not to exceed 12
consecutive months or (ii) the completion of one Year of Service
or two Years of Service, and/or (iii) if the Employer so elects,
it may adopt a minimum age requirement of age 21. The eligibility
requirement(s) designated by the Employer shall apply uniformly
to all Plan Features elected by the Employer. An Employer, at its
election and in a uniform and nondiscriminatory manner, may waive
the eligibility requirement(s) for participation specified under
this paragraph (B) for (1) all Employees, or (2) all those
Employees employed on or up to 12 months after the Employer's
Commencement Date under the Plan. Subject to the requirements of
the Code, where an Employee who participated as a Member under
the Plan terminates employment with an Employer and thereafter is
reemployed by the same (or a different) Employer, such Employee,
subject to any applicable break in service rules, shall
participate immediately upon returning to employment with respect
to the Profit Sharing Feature and the Basic and Supplemental
Employer Contribution and shall participate on the next
applicable payroll date with respect to Member Contributions,
Matching Employer Contributions and the 401(k) Feature, as and to
the extent any such contribution feature is then maintained by
such Employee's Employer. In the case of an Employer that adopts
a 401(k) Feature under Article III, Section 4, the eligibility
requirement(s) under such Feature, and any other Plan Feature
adopted by the Employer in addition to the 401(k) Feature, shall
be identical and shall not exceed the period described in clause
(i) above, and, at the election of the Employer, attainment of
age 21 as described in clause (iii) above. In the event a Member
is no longer part of an eligible class of Employees and thus
becomes ineligible to participate in the Plan, such Employee,
subject to any applicable break in service rules, shall
participate immediately upon returning to an eligible class of
Employees with respect to the Profit Sharing Feature and the
Basic and Supplemental Employer Contribution and shall
participate on the next applicable payroll date with respect to
Member Contributions, Matching Employer Contributions and the
401(k) Feature, as and to the extent any such contribution
feature is then maintained by such Employee's Employer.
For purposes of this Section and all purposes under the Plan, an
Employee who is employed on an hourly basis following the
adoption date of the Plan by the Employer, but prior to the
adoption of an hourly exclusion by his
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Employer, shall continue to be deemed to be an Employee and will
continue to receive benefits on the same basis as a regular
salaried Member, despite classification as an hourly employee. In
the event an individual who was not part of an eligible class of
Employees becomes part of an eligible class, such individual will
be eligible to participate in the Plan in accordance with the
provisions of this Section 2.
(C) Where an Employer designates a one Year of Service or two
Years of Service eligibility requirement, an Employee must
complete at least 1,000 Hours of Employment during each
12-consecutive-month eligibility computation period (measured
from his date of Employment and then from each January 1,
thereafter). Where an Employer designates an eligibility waiting
period of less than 12 months, an Employee must, for purposes of
eligibility, complete a required number of hours (measured from
his date of Employment and each anniversary thereafter) which is
arrived at by multiplying the number of months of the eligibility
waiting period requirement by 83 1/3; provided, however, if the
Employee completes at least 1,000 Hours of Employment during the
12-consecutive month eligibility computation period (measured
from his date of Employment and then from each January 1
thereafter) the Employee shall be deemed to satisfy the
eligibility waiting period designated by the Employer.
(D)(1) The Employer shall notify each Employee of his
membership in the Plan and shall furnish him with an enrollment
application in order that he may elect to make contributions
under Article III, Section 1 or elect to defer a percentage of
his Salary under the 401(k) Feature in Article III, Section 4 (if
applicable) or receive a basic contribution under Article III,
Section 2, or a Profit Sharing contribution under Article III,
Section 8 (if applicable), at the earliest possible date
consonant with Paragraph (E) of this Section.
(2) All Employees whose Employment commences after the
expiration date of the Employer's waiver of the eligibility
requirement(s) shall be enrolled in the Plan in accordance with
the eligibility requirement(s) designated in Paragraph (B) above.
(3) The Employer must submit enrollment applications to the
Board on a monthly basis.
(4) If it is determined that an Employee who is eligible to
be enrolled has, for any reason, not been so notified, such
Employee shall be furnished an application by his Employer and be
retroactively enrolled, as of the date he first became eligible,
upon receipt by the Board of the application properly executed.
In such event, the Employee
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may, at his election, make any contributions which he could have
made had he been enrolled on such date. The Employer will be
required to make the contributions (without Plan earnings
thereon) it would have made had the Employee been enrolled on
such earlier date. The Account of an Employee who is
retroactively enrolled shall, upon such enrollment, consist
solely of the number of Units which, as of the Valuation Date
coincident with or next following such enrollment, may be
credited to him pursuant to Article V based upon the amount of
contributions received by the Board.
(E) An Employee shall become a Member on his Enrollment Date
which shall be the date on which he becomes eligible. However, no
person shall under any circumstances become a Member unless and
until his enrollment application is filed with, and accepted by,
the Plan. If an Employee fails to complete the enrollment form
furnished to him, the Employer shall do so on his behalf. In the
event the Employer submits the enrollment form on behalf of the
Employee, the Employee shall be deemed to have elected not to
make any contributions under the Plan.
(F) At the option of the Employer, an Employee who is employed
on or prior to his Employer's Commencement Date may make a one
time election to waive participation in the Plan on the
Employer's Commencement Date.
(G) Membership under all provisions of the Plan shall terminate
upon the earlier of (a) a Member's termination of Employment and
payment to him of his entire vested interest, or (b) his death.
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ARTICLE III CONTRIBUTIONS
SECTION 1. CONTRIBUTIONS BY MEMBERS.
Under this Section, a Member of an Employer may elect to make a
monthly contribution under the Plan of 2% 3% 4%, 5%, 6%, 7%, 8%,
9%, 10%, 11%, or 12%, of his Salary. In addition, (i) a Member of
an Employer that adopts the Plan after December 31, 1992, and
does not elect to make contributions pursuant to the 401(k)
Feature, Option 1, under Section 4(B) of this Article, may elect
to make a monthly contribution under the Plan of 1% of his Salary
and (ii) effective July 1, 1992, a Member whose Employer makes
contributions under Section 2 of this Article, at a matching
and/or basic contribution rate such that the maximum Employer
contribution may not exceed 10% of his Salary, may elect to make
a monthly contribution of 13%, 14% or 15% of his Salary. He may
change his contribution rate or suspend his contributions at any
time, but reduced or suspended contributions may not subsequently
be made up.
SECTION 2. REGULAR CONTRIBUTIONS BY EMPLOYER.
(A) MATCHING EMPLOYER CONTRIBUTIONS
Under this Section, an Employer shall contribute monthly under
the Plan on behalf of each of its Members (subject to any
possible suspension under Article VII) an amount equal to a
percentage (as specified by the Employer) of the Member's
contributions not in excess of a maximum of 12% (in increments of
1% and subject to the further restrictions for Formula Step (2),
Formula 150 and Formula 200 specified below) of his Salary for
such month. The percentage chosen by the Employer shall be in
accordance with the schedule of contribution formulas listed
below, and must be uniformly applicable to all its Members.
Formula 0* - 0% of the Member's contributions.
Formula 25* - 25% of the Member's contributions.
Formula 50** - 50% of the Member's contributions.
______________________
* Not available to an Employer which adopts the 401(k) Feature
under Section 4(B) of this Article.
** Not available to an Employer which adopts the 401(k) Feature
under Section 4(B) of this Article contributes monthly
on behalf of each of its Members an amount equal to a
percentage of the Member's contributions not in excess of 3%
of his Salary for each month.
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Formula 75*** - 75% of the Member's
contributions.
Formula 100 - 100% of the Member's
contributions.
Formula Step (1)** - (i) 50% of the Member's
contributions during the
second and third years
of Employment.
(ii) 75% of the Member's
contributions during the
fourth and fifth years
of Employment.
(iii) 100% of the Member's
contributions upon
completion of 5 or more
years of Employment.
Formula Step (2)**** - (i) 100% of the Member's
contributions during the
second and third years
of Employment.
(ii) 150% of the Member's
contributions during the
fourth and fifth years
of Employment.
(iii) 200% of the Member's
contributions upon
completion of 5 or more
years of Employment.
Formula 150***** - 150% of the Member's
contributions.
Formula 200**** - 200% of the Member's
contributions.
(B) BASIC EMPLOYER CONTRIBUTIONS
Effective January 1, 1993, an Employer may, at its option, make a
basic contribution equal to a uniform percentage (as specified by
the Employer) of each of its Members' Salaries for each month,
provided that in no event shall such percentage exceed 15%. The
percentage so specified may be elected or changed by the Employer
by filing a properly completed form with the Thrift Plan Office.
No more than one such change may be made by an Employer during
any year. An employer may restrict the allocation of such basic
______________
*** Not available to an Employer which adopts the 401(k) Feature
under Section 4(B) of this Article and contributes monthly
on behalf of each of its Members an amount equal to a
percentage of the Member's contributions not in excess of 2%
of his Salary for such month.
**** Not available to an Employer
which contributes monthly on
behalf of each of its Members an
amount equal to a percentage of
the Member's contributions not
in excess of 7%, 8%, 9%, 10%,
11%, 12% 13%, 14%, or 15% of his
Salary for each month.
***** Not available to an Employer
which contributes monthly on
behalf of each of its Members an
amount equal to a percentage of
the Member's contributions not
in excess of 9%, 10%, 11%, 12%,
13%, 14% or 15% of his Salary
for each month.
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contribution to those Members who were employed with the Employer
on the last working day of the month for which the basic
contribution is made.
At the election of the Employer, any basic contribution shall be
credited to its Members' 401(k) Accounts or Regular Accounts on a
uniform basis.
(C) REGULAR ACCOUNTS
A Regular Account shall be established and maintained for each
Member on whose behalf contributions are made to the Plan
pursuant to Section 1 or 2 of this Article.
SECTION 3. SUPPLEMENTAL CONTRIBUTIONS BY EMPLOYER.
An Employer may, at its option, make a supplemental contribution
under Formula (1) or (2) below:
FORMULA (1) - A uniform percentage (as specified by the Employer)
of each Member's contributions which were received by the Plan
during the preceding Plan Year, provided that in no event shall a
supplemental contribution under Formula (1) for any Member exceed
6% of the Member's Salary. Such supplemental contribution may be
made on or before the last day of February in any year on behalf
of all those Members who were in its employ on the last working
day of the preceding Plan Year. For purposes of this Section,
Members on a Type 1 non-military Leave of Absence (as defined
under Article I, Paragraph (20) and Article X, Section 8(B)(1)),
or a Type 4 military Leave of Absence (as defined under Article
I, Paragraph (20) and Article X, Section 8(B)(4)), shall be
deemed employed on the last working day of such preceding Plan
Year.
FORMULA (2) - A uniform dollar amount per Member (provided that
this option shall not be available prior to December 31, 1992) or
a uniform percentage of each Member's Salary (i) for the
preceding Plan Year, regardless of whether the Member was
eligible to participate in the Plan during the entire Plan Year,
or (ii) if an Employer so elects with respect to all of its
Members, for the portion of the preceding Plan Year during which
the Member was eligible to participate in the Plan. Such
supplemental contribution may be made on or before the last day
of February in any year on behalf of all those Members who were
in its employ on the last working day of the preceding Plan Year.
For purposes of this Section, Members on a Type 1 non-military
Leave of Absence (as defined under Article I, Paragraph (20) and
Article X, Section 8(B)(1)), or a Type 4 military Leave of
Absence (as defined under Article I, Paragraph (20) and Article
X, Section 8(B)(4)), shall be deemed employed on the last working
day of such preceding Plan Year. The percentage contributed under
this Formula (2) shall be limited in accordance with the
Employer's matching formula and basic contribution rate under
Section 2 of this Article such that the sum of the Employer's
Formula (2) supplemental contribution plus the Employer
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basic contribution and the maximum Employer matching contribution
under Section 2 of this Article shall not exceed 15% of Salary
for such year.
At the election of the Employer, any supplemental contribution
shall be credited either to its Members' 401(k) Accounts or
Regular Accounts on a uniform and nondiscriminatory basis.
SECTION 4. 410(K) FEATURES.
(A) An Employer may, at its option, adopt either the 401(k)
Feature under Paragraph (B) of this Section or one of the 401(k)
Features described in Paragraph (C) of this Section. Under any
401(k) Feature, there shall be established for each of its
Members a "401(k) Account. " (For purposes of this Section, the
"401(k) Account" and the "Regular Account" shall comprise the
Member's Account as defined in Article I, Paragraph (1).) A
Member's 401(k) Account shall be invested pursuant to his overall
directions under Article IV but maintained separately from his
Regular Account (consisting of the value of contributions made
under Sections 1 and 2 of this Article).
(B) OPTION 1 - Under the 401(k) Feature provided in this
Paragraph (B), each Member may elect to defer 2%, 3%, 4%, 5%, 6%,
7%, 8%, 9%, 10%, 11% or 12% of his monthly Salary and direct his
Employer to contribute such amount to his 401(k) Account. In
addition, effective July 1, 1992, a Member whose Employer makes
contributions under Section 2 of this Article, at a matching
and/or basic contribution rate such that the maximum Employer
contribution may not exceed 10% of his Salary, may elect a
deferral rate of 13%, 14% or 15% of his Salary. Such deferral to
the 401(k) Account shall reduce the Member's current monthly
contribution under Section 1 of this Article.
The Employer shall contribute monthly to each Member's 401(k)
Account an amount equal to 2% of his monthly Salary not in excess
of $3,750, subject to Article X, Section 1 of the Plan, unless
the Member has deferred amounts of his monthly Salary pursuant to
the preceding paragraph, in which case the Employer's 2%
contribution will be allocated to the Member's Regular Account.
The amount which the Employer would otherwise be required to
contribute with respect to each Member under Section 2 of this
Article shall be reduced, but not below zero, by the amount which
it contributes with respect to the Member under this Paragraph
(B). Notwithstanding anything in this Paragraph to the contrary,
should a Member's deferrals to the 401(k) Account reach the
maximum specified under the provisions of Paragraph (I) below in
any Plan Year, the Employer's 2% contribution will be allocated
to the Member's Regular Account for the remainder of such Plan
Year.
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(C) Effective January 1, 1989, the Employer may no longer elect
the Monitored 401(k) Feature. The Monitored 401(k) Feature
previously required that each Member's contributions made under
Section 1 of this Article, up to 6% (or, at the election of the
Employer, up to 3%) of his Salary, shall be allocated to the
Member's 401(k) Account. If the Member contributed an amount in
excess of 6% (or, at the election of the Employer, in excess of
3%) of his Salary, the Member was permitted to allocate such
excess contributions to his 401(k) or Regular Account in
increments of 1% of his Salary.
Commencing effective January 1, 1989, the Employer, at its
option, may adopt either of the two additional 401(k) Features
described below:
OPTION 2 - Under this Feature, each Member, at his election, may
make deferrals to his 401(k) Account and/or contributions to his
Regular Account, in the amounts specified in Article III, Section
4(B), and Article III, Section 1, respectively. Such amounts may
be allocated between the 401(k) Account and/or the Regular
Account based on multiples of 1%.
If so adopted, Employer contributions under the Plan, which shall
be made monthly on behalf of each Member in an amount equal to a
percentage of the Member's deferrals to his 401(k) Account and
contributions to his Regular Account as specified by the Employer
under Section 2 of Article III (in 1% increments ranging from 1%
to 15%) of his Salary for such month, shall first be allocated to
a Member's 401(k) Account until total Member deferrals and
Employer contributions allocated to the Member's 401(k) Account
equal a percentage specified by the Employer not in excess of
15%. Thereafter, the Employer contributions, with respect to both
Member 401(k) deferrals and Regular contributions, shall be
contributed to the Member's Regular Account in an amount pursuant
to the percentage elected in the preceding sentence.
Notwithstanding the Employer election made under this Option 2,
if the Member has deferred amounts of his monthly Salary equal to
the maximum specified under the provisions of Paragraph (I)
below, the Employer shall contribute the remaining Employer
contributions to the Member's Regular Account.
OPTION 3 - Under this Feature each Member may make deferrals to
his 401(k) Account, but not contributions to his Regular Account.
Each Member may elect to defer 2%, 3%, 4%, 5%, 6%, 7%, 8%, 9%,
10%, 11%, or 12% of his monthly Salary and direct his Employer to
contribute such amount to his 401(k) Account. In addition, (i) a
Member of an Employer that adopts the Plan after December 31,
1992, may elect a deferral rate of 1% of his Salary and (ii)
effective July 1, 1992, a Member whose Employer makes
contributions under Section 2 of this Article, at a matching
and/or basic contribution rate such that the maximum Employer
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<PAGE>
contribution may not exceed 10% of his Salary, may elect a
deferral rate of 13%, 14% or 15% of his Salary. The Employer
shall contribute monthly under the Plan on behalf of each Member
an amount equal to a percentage, specified by the Employer under
Section 2 of Article III, of the Member's deferrals to his 401(k)
Account. The Employer's contributions under this Feature shall be
made to the Member's Regular Account.
(D) Notwithstanding any other provision of this Section 4,
the actual deferral percentages for the Plan Year for Highly
Compensated Employees shall not exceed the greater of the
following actual deferral percentages: (a) the actual deferral
percentage for such Plan Year of those Employees who are not
Highly Compensated Employees multiplied by 1.25; or (b) the
actual deferral percentage for the Plan Year of those Employees
who are not Highly Compensated Employees multiplied by 2.0,
provided that the actual deferral percentage for the Highly
Compensated Employees does not exceed the actual deferral
percentage for such other Employees by more than 2 percentage
points. For purposes of this Section 4, the "actual deferral
percentage" for a Plan Year means, for each specified group of
employees, the average of the ratios (calculated separately for
each Employee in such group) of (a) the amount of deferrals
and/or contributions made to the Member's 401(k) Account for the
Plan Year, to (b) the amount of the Member's compensation (as
defined in Section 414(s) of the Code) which, at the Employer's
election, shall include the compensation required to be reported
under Section 6041 or 6051 of the Code (i.e., "W-2 compensation")
for the Plan Year or, alternatively, where specifically elected
by the Employer, for only that part of the Plan Year during which
the Member was eligible to participate in the Plan. An Employee's
actual deferral percentage shall be zero if no 401(k) deferral or
contribution is made on his behalf for such Plan Year. If the
Plan and one or more other plans which include cash or deferred
arrangements are considered as one plan for purposes of Sections
401(a)(4) and 410(b) of the Code, the cash or deferred
arrangements included in such plans shall be treated as one
arrangement for purposes of this Section 4. For purposes of
determining the actual deferral percentage of a Member who is a
Highly Compensated Employee subject to the family aggregation
rules of Section 414(q)(6) of the Code because such Employee is
either a five-percent owner or one of the ten most Highly
Compensated Employees as described in Section 414(q)(6) of the
Code, the 401(k) deferrals, contributions and compensation (as
defined in Section 414(s) of the Code) of such Member shall
include 401(k) deferrals, contributions and compensation (as
defined in Section 414(s) of the Code) of "family members",
within the meaning of Section 414(q)(6) of the Code, and such
"family members" shall not be considered as separate Employees in
determining actual deferral percentages. In accordance with IRS
Regulations, the actual deferral percentage of a Member who is a
Highly Compensated Employee and who is eligible to participate in
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two or more cash or deferred arrangements maintained by his
Employer shall be determined by treating all such cash or
deferred arrangements as a single arrangement.
(E) The Thrift Plan Office shall determine as of the end of the
Plan Year whether one of the actual deferral percentage tests
specified in Paragraph (D) above is satisfied for such Plan Year.
This determination shall be made after first determining the
treatment of excess deferrals within the meaning of Section
402(g) of the Code under Paragraph (I) below. In the event that
neither of such actual deferral percentage tests is satisfied,
the Thrift Plan Office shall, to the extent permissible under the
Code and the IRS Regulations, refund the excess contributions for
the Plan Year in the following order of priority: by (i)
refunding such amounts deferred by the Member and allocated to
his 401(k) Account which were not matched by his Employer (and
any earnings and losses allocable thereto), and (ii) refunding
amounts deferred for such Plan Year by the Member and allocated
to his 401(k) Account (and any earnings and losses allocable
thereto) and, in accordance with the Code and applicable IRS
Regulations, forfeiting the amounts contributed for such Plan
Year by the Employer with respect to the Member's 401(k)
deferrals that are returned pursuant to this Paragraph (and any
earnings and losses allocable thereto). The distribution of such
excess contributions shall be made to Highly Compensated Members
to the extent practicable before the 15th day of the third month
immediately following the Plan Year for which such excess
contributions were made, but in no event later than the end of
the Plan Year following such Plan Year or, in the case of the
termination of the Plan in accordance with Article XII or
termination of Employer participation in the Plan in accordance
with Article XI, no later than the end of the twelve-month period
immediately following the date of such termination. For purposes
of this Section 4, "excess contributions" means, with respect to
any Plan Year, the excess of the aggregate amount of 401(k)
deferrals and/or contributions (and any earnings and losses
allocable thereto) made to the 401(k) Accounts of Highly
Compensated Members for such Plan Year, over the maximum amount
of such deferrals and/or contributions that could be made to the
401(k) Accounts of such Members without violating the
requirements of Paragraph (D) above, determined by reducing
401(k) deferrals and/or contributions made by or on behalf of
Highly Compensated Members in order of the actual deferral
percentages beginning with the highest of such percentages. The
distribution of excess contributions shall be made to Highly
Compensated Members on the basis of the respective portions of
the excess contributions attributable to each such Member. Excess
contributions of Members who are subject to the family member
aggregation rules shall be allocated among the family members in
proportion to the 401(k) deferrals (and amounts treated as 401(k)
deferrals) of each family member that are aggregated to determine
the combined actual deferral percentages.
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(F) Notwithstanding any other provision of the Plan, the sum
of the actual deferral percentage determined in accordance with
Paragraph (D) above of those Employees who are Highly Compensated
Employees and the actual contribution percentage determined in
accordance with Section 7 of this Article III of those Employees
who are Highly Compensated Employees may not exceed the aggregate
limit as determined below.
For purposes of this Section 4, the "aggregate limit" for a Plan
Year is the greater of:
(1) The sum of:
(a) 1.25 times the greater of the relevant actual deferral
percentage or the relevant actual contribution
percentage, and
(b) Two percentage points plus the lesser of the relevant
actual deferral percentage or the relevant actual
contribution percentage. In no event, however, shall
this amount exceed twice the lesser of the relevant
actual deferral percentage or the relevant actual
contribution percentage; or
(2) The sum of:
(a) 1.25 times the lesser of the relevant actual deferral
percentage or the relevant actual contribution
percentage, and
(b) Two percentage points plus the greater of the relevant
actual deferral percentage or the relevant actual
contribution percentage. In no event, however, shall
this amount exceed twice the greater of the relevant
actual deferral percentage or the relevant actual
contribution percentage; provided, however, that if a
less restrictive limitation is prescribed by the IRS,
such limitation shall be used in lieu of the
foregoing. The relevant actual deferral percentage and
relevant actual contribution percentage are defined in
accordance with the Code and the IRS Regulations.
The Thrift Plan Office shall determine as of the end of the Plan
Year whether the aggregate limit has been exceeded. This
determination shall be made after first determining the treatment
of excess deferrals within the meaning of Section 402(g) of the
Code under Paragraph (I) below, then determining the treatment of
excess contributions under Paragraph (E) above, and then
determining the treatment of excess aggregate contributions under
Section 7 of this Article III. In the event that the aggregate
limit is exceeded, the actual contribution percentage of those
Employees who are Highly Compensated Employees shall be reduced
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in the same manner as described in Section 7 of this Article
until the aggregate limit is no longer exceeded, unless the
Thrift Plan Office designates, in lieu of the reduction of the
actual contribution percentage a reduction in the actual deferral
percentage of those Employees who are Highly Compensated
Employees, which reduction shall occur in the same manner as
described in Section 4(E) of this Article until the aggregate
limit is no longer exceeded.
(G) Notwithstanding the provisions of Paragraphs (D) and (E)
above, the amount of excess contributions to be distributed
pursuant to Paragraph (E) above, with respect to a Member for a
Plan Year, shall be reduced by any excess deferrals distributed
to such Member for such Plan Year pursuant to Paragraph (I)
below.
(H) A withdrawal from the vested portion of a Member's 401(k)
Account may be made only upon (a) attainment of age 59 1/2, (b)
hardship (as determined by the Board in accordance with this
Paragraph (H)), (c) termination of Employment, (d) death, (e)
Disability or (f) termination of an Employer's participation in
the Plan provided the Employer certifies in writing in such form
as is satisfactory to counsel that no successor defined
contribution plan (other than an employee stock ownership plan as
defined in Section 4975(e)(7) of the Code) will be established or
maintained by the Employer at the time of termination of
participation in the Plan or will be maintained through the
period ending twelve months after distribution of all assets from
the Plan attributable to the Employer's participation in the Plan
and amounts distributed upon such event shall be in the form of a
"lump sum distribution" within the meaning of Section 402(e)(4)
of the Code (without regard to Code Sections 402(e)(4)(A)(i)-(iv)
and Code Sections 402(e) (4) (B) and (H)).
A withdrawal is on account of hardship only if the distribution
is both made on account of an immediate and heavy financial need
of the Member and is necessary to satisfy such financial need,
and further provided that no earnings in the Member's 401(k)
Account credited on or after January 1, 1989 and/or Employer
contributions made to the Member's 401(k) Account on or after
January 1, 1989 may be distributed in satisfying such need. For
the purposes of this Paragraph (H), the term "immediate and heavy
financial need" shall be limited to the need of funds for (i) the
payment of medical expenses described in Section 213(d) of the
Code previously incurred by the Member, the Member's Spouse, or
any of the Member's dependents (as defined in Section 152 of the
Code) or necessary for those persons to obtain such care, (ii)
the payment of tuition for the next twelve months of
post-secondary education of the Member, the Member's Spouse, the
Member's children, or any of the Member's dependents (as defined
in Section 152 of the Code), (iii) the purchase (excluding
mortgage payments) of a principal residence for the Member, or
(iv) the prevention of eviction of the Member from his principal
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residence or the prevention of foreclosure on the mortgage of the
Member's principal residence. For purposes of this Paragraph (H),
a distribution generally may be treated as "necessary to satisfy
a financial need" if the Employer reasonably relies upon the
Member's written representation that the need cannot be relieved
(i) through reimbursement or compensation by insurance or
otherwise, (ii) by reasonable liquidation of the Member's assets,
to the extent such liquidation would not itself cause an
immediate and heavy financial need, (iii) by cessation of Member
401(k) deferrals pursuant to Article III, Section 4 of the Plan
or Member Regular contributions pursuant to Article III, Section
1 of the Plan or (iv) by other distributions or nontaxable (at
the time of the loan) loans from plans maintained by the Employer
or by any other employer, or by borrowing from commercial sources
on reasonable commercial terms. The amount of any withdrawal
pursuant to this Paragraph (H) shall not exceed the amount
required to meet the demonstrated financial hardship, including
any amounts necessary to pay any federal income taxes and
penalties reasonably anticipated to result from the distribution,
as certified to the Plan by the Member.
No amounts may be withdrawn on account of hardship pursuant to
this Paragraph prior to a Member's withdrawal of the remaining
vested balance of his Regular Account and Rollover Account,
notwithstanding the withdrawal restrictions contained in Article
VII, Section 2 or below.
Only one in-service withdrawal under this Paragraph may be made
in any Plan Year, and any amounts paid under this Article may not
be returned to the Plan. The amount of a withdrawal under this
Paragraph (H) must be not less than the lesser of (i) $1,000,
(ii) the full value of the vested portion of the 401 (k) Account
(reduced by the amount of post-December 31, 1988 earnings and
Employer 401(k) contributions for those Members who have not
attained age 59 1/2, if such value is less than $1,000, or (iii)
the amount approved as a hardship withdrawal by the Board.
(I) Notwithstanding any other provision of the Plan, no
Member may defer to his 401(k) Account during any Plan Year an
amount in excess of $7,000 multiplied by the adjustment factor as
provided by the Secretary of the Treasury. The adjustment factor
shall mean the cost of living adjustment factor prescribed by the
Secretary of the Treasury under Section 402(g)(5) of the Code for
years beginning after December 31, 1987, as applied to such items
and in such manner as the Secretary shall provide. In the event
that the aggregate amount of 401(k) deferrals for a Member
exceeds the limitation in the previous sentence, the amount of
such excess, increased by any income and decreased by any losses
attributable thereto, shall be refunded to such Member no later
than the April 15 of the Plan Year following the Plan Year for
which the 401(k) deferrals were made.
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SECTION 5. REMITTANCE OF CONTRIBUTIONS.
The monthly contributions of both Members and their Employer
(including an administrative fee, as determined by the Board, to
be paid by the Employer to defray expenses attributable to its
participation in the Plan) shall be recorded by the Employer and
remitted to the Board so that the Board shall be in receipt
thereof by the 15th day of the month next following the month in
respect of which such contributions are payable. Such amounts
shall be used to provide additional Units pursuant to Article V.
Any contributions received by the Thrift Plan Office on the first
working day of a month shall be deemed to have been received on
the last working day of the immediately preceding month. Working
day shall be defined as any day regular mail is delivered by the
United States Postal Service.
SECTION 6. TRANSFER OF FUNDS AND ROLLOVER CONTRIBUTIONS.
(A) Upon such terms and conditions as the Board and the IRS
shall approve, and provided that all benefits (including all
optional forms of benefit) under the prior retirement plan are
protected in accordance with Section 411(d)(6) of the Code, or
any successor thereto, and the IRS Regulations thereunder, a
transfer of funds may be made to the Plan from a prior retirement
plan of an employer which was qualified under Section 401(a) of
the Code so long as such funds (a) have been allocated to the
individual members of such prior plan, (b) shall be allocated to
the Accounts of the Members of the Plan to whom they were
allocated under such prior plan, and (c) shall be applied so that
each Member affected thereby would receive a benefit immediately
after the transfer, if the Plan then terminated, at least equal
to the benefit he would have received upon a termination of such
prior plan immediately before such transfer. In addition to
protecting those prior retirement plan benefits as required in
the preceding sentence, the Thrift Plan Office may, in its
discretion, preserve any other prior retirement plan options
which it determines to be economically and administratively
feasible and which are not required to be protected under Section
411(d)(6) of the Code. Each Employee with respect to whom such a
transfer is made shall, upon such transfer, be eligible for
membership in the Plan.
(B) If the funds so transferred are transferred from a
retirement plan subject to Code Section 401 (a)(11), then such
funds shall be maintained in a separate account and any
subsequent distribution of those funds, and earnings thereon,
shall be subject to the following provisions:
(1) The benefit to which a married Member is entitled
shall, except as otherwise provided in this Paragraph (B), be
payable by purchase from an insurance company of a single premium
contract providing for a Qualified Joint and Survivor Annuity.
The term, "Qualified Joint and Survivor Annuity," means a benefit
providing an annuity commencing
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immediately for the life of the Member, ending with the payment
due on the last day of the month coincident with or preceding the
date of his death, and, if the Member dies leaving a Surviving
Spouse, a survivor annuity for the life of such Surviving Spouse
equal to one-half of the annuity payable for the life of the
Member under his Qualified Joint and Survivor Annuity, commencing
on the last day of the month following the date of the Member's
death and ending with the payment due on the first day of the
month coincident with or preceding the date of such Surviving
Spouse's death.
(2) In lieu of the form of benefit described immediately
above, any benefit payable pursuant to this Paragraph (B)
may be paid in one cash payment thereof, subject to the
provisions of Subparagraph (5) below.
(3) If a Member dies prior to the date payment of his benefit
commences (i) without leaving a Surviving Spouse, or (ii) leaving
a Surviving Spouse and having made a valid election to waive the
Preretirement Survivor Annuity in accordance with Subparagraph
(5) below, then the remaining value of the Member's account
subject to this Paragraph (B) shall become payable to his
Beneficiary in a lump sum subject to Article III, Section 8(E)(2)
and Article VII, Section 3(B).
(4) A Preretirement Survivor Annuity shall be paid to the
Surviving Spouse of a Member or former Member who dies before the
commencement of payment of any benefit from an account subject to
this Paragraph (B). The term " Preretirement Survivor Annuity"
means a benefit providing for payment of 50% of the Member's
account balance as of the Valuation Date coincident with or
preceding the date of his death, by the purchase of a single
premium contract issued by an insurance company providing a
survivor annuity to his Surviving Spouse, for the life of such
Surviving Spouse. Payment of a Preretirement Survivor Annuity
shall commence in the month following the month in which the
Member dies or as soon as practicable thereafter; provided,
however, that to the extent required by law, if the value of the
amount used to purchase a Preretirement Survivor Annuity exceeds
$3,500, then payment of the Preretirement Survivor Annuity shall
not commence prior to the date the Member reached (or would have
reached, had he lived) Normal Retirement Age without the written
consent of the Member's Surviving Spouse. Absence of any required
consent will result in a deferral of payment of the Preretirement
Survivor Annuity to the month following the month in which occurs
the earlier of (i) the date the required consent is received by
the Board or (ii) the date the Member would have reached Normal
Retirement Age had he lived.
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(5) (i) In the case of the Qualified Joint and Survivor
Annuity, the Fund shall no less than 30 days and no more than 90
days prior to the annuity starting date provide each Member a
written explanation of: (i) the terms and conditions of the
Qualified Joint and Survivor Annuity; (ii) the Member's right to
make and the effect of an election to waive the Qualified Joint
and Survivor Annuity form of benefit; (iii) the rights of a
Member's Spouse; and (iv) the right to make, and the effect of, a
revocation of a previous election to waive the Qualified Joint
and Survivor Annuity. In the case of the Preretirement Survivor
Annuity, the Fund shall provide each Member within the applicable
period for such Member a written explanation of the Preretirement
Survivor Annuity in such terms and in such manner as would be
comparable to the explanation provided for meeting the
requirements applicable to the Qualified Joint and Survivor
Annuity.
The applicable period for a Member is whichever of the following
periods ends last: (i) the period beginning with the first day of
the Plan Year in which the Member attains age 32 and ending with
the close of the Plan Year preceding the Plan Year in which the
Member attains age 35; (ii) a reasonable period ending after the
individual becomes a Member; or (iii) a reasonable period ending
after this subparagraph (i) first applies to the Member.
Notwithstanding the foregoing, notice must be provided within a
reasonable period ending after separation from service in the
case of a Member who separated from service before attaining age
35.
For purposes of applying the preceding paragraph, a reasonable
period ending after the enumerated events described in (ii) and
(iii) is the end of the two-year period beginning one year prior
to the date the applicable event occurs, and ending one year
after that date. In the case of a Member who separates from
service before the Plan Year in which age 35 is attained, notice
shall be provided within the two-year period beginning one year
prior to separation and ending one year after separation. If such
a Member thereafter returns to employment with an Employer, the
applicable period for such Member shall be redetermined.
(ii) A Member may, with the written consent of his Spouse
(unless the Board makes a written determination in accordance
with the Code and the Regulations that no such consent is
required), elect in writing (i) to receive his benefit in a
single lump sum payment within the 90-day period ending on his
annuity starting date
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(which is the first day of the first period for which an amount
is paid as an annuity or any other form); and (ii) to waive the
Preretirement Survivor Annuity within the period beginning on the
first day of the Plan Year in which the Member attains age 35 and
ending on the date of his death. Any election made pursuant to
this Subparagraph (5) may be revoked by a Member, without spousal
consent at any time within which such election could have been
made. Such an election or revocation must be made in accordance
with procedures developed by the Board and shall be notarized.
Any consent by a Spouse obtained under this provision (or
establishment that the consent of a Spouse may not be obtained)
shall be effective only with respect to such Spouse. A consent
that permits designations by the Member without any requirement
of further consent by such Spouse must acknowledge that the
Spouse has the right to limit consent to a specific Beneficiary,
and a specific form of benefit where applicable, and that the
Spouse voluntarily elects to relinquish either or both of such
rights. No consent obtained under this provision shall be valid
unless the Member has received the notice described in
subparagraph (i) above.
(6) Notwithstanding the preceding provisions of this Paragraph
(B), any benefit of $3,500, subject to the limits of Article X,
Section 4, or less shall be paid in a lump cash sum in full
settlement of the Plan's liability therefor; provided, however,
that in the case of a married Member, no such lump sum payment
shall be made after benefits have commenced without the consent
of the Member and his Spouse or, if the Member has died, the
Member's Surviving Spouse. Furthermore, if the value of the
benefit payable to a Member or his Surviving Spouse is greater
than $3,500 and the Member has or had not reached his Normal
Retirement Age, then to the extent required by law, unless the
Member (and, if the Member is married and his benefit is to be
paid in a form other than a Qualified Joint and Survivor Annuity,
his Spouse, or, if the Member was married, his Surviving Spouse)
consents in writing to an immediate distribution of such benefit,
his benefit shall continue to be held in the Trust until a date
following the earlier of (i) the date of the Board's receipt of
all required consents or (ii) the date the Member reaches his
earliest possible Normal Retirement Age under the Plan (or would
have reached such date had he lived), and thereafter shall be
paid in accordance with this Paragraph (B).
(C) Upon Such terms and conditions as the Board shall approve,
effective January 1, 1993, (i) all Members (regardless of whether
their Accounts are active) shall be permitted to make rollover
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contributions to the Plan of amounts held on their behalf in an
employee benefit plan qualified under Section 401(a) of the Code
or an individual retirement account or annuity described in
Section 408(d)(3) of the Code and (ii) an Employer may, at its
option, permit its Employees to make rollover contributions prior
to the date as of which the Employees become eligible for
membership in the Plan. All such amounts which are accepted by
the Thrift Plan Office shall be certified in form and substance
satisfactory to the Thrift Plan Office by the Member as
consisting of all or a portion of (i) a "qualified total
distribution" within the meaning of Section 402(a)(5)(E)(i) of
the Code or (ii) effective January 1, 1993, an "eligible rollover
distribution" or a "rollover contribution" within the meaning of
Section 402(c)(4) or Section 408(d)(3), respectively, of the
Code. A Member shall have a nonforfeitable vested interest in all
such amounts credited to his Rollover Account
SECTION 7. LIMITATIONS ON MEMBER CONTRIBUTIONS AND MATCHING
EMPLOYER CONTRIBUTIONS.
(A) Notwithstanding any other provision of this Section 7, the
actual contribution percentage for the Plan Year for Highly
Compensated Employees shall not exceed the greater of the
following actual contribution percentages: (a) the actual
contribution percentage for such Plan Year of those Employees who
are not Highly Compensated Employees multiplied by 1.25; or (b)
the actual contribution percentage for the Plan Year of those
Employees who are not Highly Compensated Employees multiplied by
2.0, provided that the actual contribution percentage for the
Highly Compensated Employees does not exceed the "actual
contribution percentage " for such other Employees by more than 2
percentage points. For purposes of this Section 7, the "actual
contribution percentage" for a Plan Year means, for each
specified group of Employees, the average of the ratios
(calculated separately for each Employee in such group) of (a)
the sum of (i) Employer matching contributions credited to his
Regular Account as described in Section 2 and Section 3, Formula
(1) of this Article for the Plan Year, (ii) Member contributions
credited to his Regular Account for the Plan Year, and (iii) in
accordance with and to the extent permitted by the IRS
Regulations, 401(k) deferrals credited to his 401(k) Account, to
(b) the amount of the Member's compensation (as defined in
Section 414(s) of the Code) which, at the Employer's election,
shall include the compensation required to be reported under
Section 6041 or 6051 of the Code (i.e., "W-2 compensation") for
the Plan Year or, alternatively, where specifically elected by
the Employer, for only that part of the Plan Year during which
the Member was eligible to participate in the Plan. The 401(k)
deferrals referred to in (iii) above in this Paragraph (A) may be
taken into account in determining the actual contribution
percentage for a Plan Year if the actual deferral percentage test
is satisfied prior to and following the exclusion of the 401(k)
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deferrals that are used to satisfy the actual contribution
percentage test. An Employee's actual contribution percentage
shall be zero if no such contributions are made on his behalf for
such Plan Year. The actual contribution percentage taken into
account under this Paragraph (A) for any Highly Compensated
Employee who is eligible to make Member contributions or receive
Employer matching contributions under two or more plans described
in Section 401(a) of the Code or arrangements described in
Section 401(k) of the Code that are maintained by the Employer
shall be determined as if all such contributions were made under
a single plan. For purposes of determining the actual
contribution percentage of a Member who is a Highly Compensated
Employee subject to the family aggregation rules of Section
414(q)(6) of the Code because such Member is either a
five-percent owner or one of the ten most Highly Compensated
Employees as described in Section 414(q)(6) of the Code, the
Employer matching and Member contributions and compensation (as
defined in Section 414(s) of the Code) of such Member shall
include the Employer matching and Member contributions and
compensation (as defined in Section 414(g) of the Code) of
"family members", within the meaning of Section 414(q)(6) of the
Code, and such "family members" shall not be considered as
separate Employees in determining actual contribution
percentages.
(B) The Thrift Plan Office shall determine as of the end of
the Plan Year whether one of the actual contribution percentage
tests specified in Paragraph (A) above is satisfied for such Plan
Year. This determination shall be made after first determining
the treatment of excess deferrals within the meaning of Section
402(g) of the Code under Article III, Section 4(I) and then
determining the treatment of excess contributions under Article
III, Section 4(E). In the event that neither of the actual
contribution percentage tests is satisfied, the Thrift Plan
Office shall refund the excess aggregate contributions in the
manner described in Paragraph (C) below. For purposes of this
Section 7, "excess aggregate contributions" means, with respect
to any Plan Year and with respect to any Member, the excess of
the aggregate amount of contributions (and any earnings and
losses allocable thereto) made as (a) Employer matching
contributions to their Regular Accounts, (b) Member contributions
to their Regular Accounts and (c) 401(k) deferrals by Members to
their 401(k) Accounts (to the extent permitted by the IRS
Regulations and if the Thrift Plan Office elects to take into
account such 401(k) contributions when calculating the actual
contribution percentage) of Highly Compensated Members for such
Plan Year, over the maximum amount of such contributions that
could be made as Employer matching contributions to Regular
Accounts, Member contributions to Regular Accounts and 401(k)
deferrals by Members to 401(k) Accounts of such Members without
violating the requirements of Paragraph (A) above.
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(C) If the Thrift Plan Office is required to refund excess
aggregate contributions for any Highly Compensated Member for a
Plan Year in order to satisfy the requirements of Paragraph (A)
above, then the refund of such excess aggregate contributions
shall be made with respect to such Highly Compensated Members to
the extent practicable before the 15th day of the third month
immediately following the Plan Year for which such excess
aggregate contributions were made, but in no event later than the
end of the Plan Year following such Plan Year or, in the case of
the termination of the Plan in accordance with Article XII or
termination of Employer participation in the Plan in accordance
with Article XI, no later than the end of the twelve-month period
immediately following the date of such termination. For each such
Member, the amounts so refunded shall be made in the following
order of priority: (i) to the extent that the amounts contributed
by the Member to his Regular Account for such Plan Year exceed
the highest rate of such contributions with respect to which
amounts were contributed by the Employer to the Member's Regular
Account, by refunding such amounts contributed by the Member to
his Regular Account which were not matched by his Employer (and
any earnings and losses allocable thereto) and (ii) by refunding
amounts contributed for such Plan Year by the Member to his
Regular Account which were matched by his Employer (and any
earnings and losses allocable thereto) and, solely to the extent
permitted under the Code and applicable IRS Regulations,
distributing to the Member amounts contributed for such Plan Year
by the Employer with respect to the amounts so returned (and any
earnings and losses allocable thereto). All such distributions
shall be made to, or shall be with respect to, Highly Compensated
Members on the basis of the respective portions of such amounts
attributable to each such Highly Compensated Member.
SECTION 8. PROFIT SHARING FEATURE.
(A) An Employer may, at its option, adopt a Profit Sharing
Feature as described herein, subject to any other provisions of
the Plan, where applicable. This Feature may be adopted either in
lieu of, or in addition to, any other Plan Feature contained in
this Article III, including the contributions described in
Sections 1 through 4 of this Article. The Profit Sharing Feature
is designed to provide the Employer a means by which to provide
discretionary contributions on behalf of Employees eligible under
the Plan.
Where investments provided for the contributions permitted
under Article III, Sections 1 through 4 were subject to the
Members' investment directions among the Investment Funds and the
Profit Sharing Feature elected by the Employer requires that all
account balances be invested in Investment Fund B or D, the
accounts provided under Article III, Sections 1 through 4 will
continue to be subject to the Members' directions, pursuant to
the provisions of Article IV.
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(B) (1) Subject to the provisions of Article X, Section
1, an Employer may, but shall not be required to, contribute on
behalf of each of its Members, on an annual (or at the election
of the Employer, quarterly) basis for any Plan Year or fiscal
year of the Employer (as the Employer shall elect), a
discretionary amount not to exceed the maximum amount allowable
as a deduction to the Employer under the provisions of Section
404 of the Code. Such Profit Sharing contribution must be
received by the Thrift Plan Office on or before the last business
day of the second month following the close of the Contribution
Determination Period on behalf of all those Members who were in
its employ on the last working day of such Contribution
Determination Period. For purposes of making the al locations
described in this Subparagraph (B)(1), a Member who is on a Type
1 non-military Leave of Absence (as defined in Article I,
Paragraph (20) and Article X, Section 8 (B) (1)) or a Type 4
military Leave of Absence (as defined in Article I, Paragraph
(20) and Article X, Section 8(B)(4)), shall, notwithstanding the
provisions of this Paragraph, be treated as if he were a Member
who was an Employee in Employment on the last day of such
Contribution Determination Period.
(2) A Profit Sharing Account shall be established and
maintained on behalf of each Member whose Employer has adopted
the Profit Sharing Feature showing each Member's interests in the
Investment Funds attributable solely to such Profit Sharing
contributions. The interest in each Investment Fund shall be
represented by Units. These Units will be valued in accordance
with Article V. Such account shall be known as the "Profit
Sharing Account," as defined under Article I, Paragraph (27) and
shall be an account segregated from all other accounts maintained
under the Plan with respect to such Member.
(C) (1) Contributions shall be allocated to each Member's
Profit Sharing Account for the Contribution Determination Period
at the election of the Employer, in accordance with one of the
options selected below: (1) in the same ratio as each Member's
Salary during such Contribution Determination Period bears to the
total of such Salary of all Members, (ii) in the same ratio as
each Member's Salary for the portion of the Contribution
Determination Period during which the Member satisfied the
Employer's eligibility requirement(s) bears to the total of such
Salary of all Members or (iii) an Employer may integrate the
Profit Sharing Feature with Social Security in accordance with
the following provision. The annual (or quarterly, if applicable)
contribution for any Contribution Determination Period (which
period shall include, for the purposes of the following maximum
integration levels provided under
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Subparagraphs (C)(1) and (2) for those Employers who have elected
quarterly allocations of contributions, the four quarters of a
Plan Year or fiscal year) shall be allocated to each Member who
is employed by the Employer on the last day of such Contribution
Determination Period in a uniform percentage (i) of each Member's
Salary during the Contribution Determination Period up to the
Social Security Taxable Wage Base for such Contribution
Determination Period (the "Base Contribution Percentage"), plus a
uniform percentage of each Member's Salary for the Contribution
Determination Period in excess of the Social Security Taxable
Wage Base for such Contribution Determination Period (the "Excess
Contribution Percentage"), or (ii) of each Member's Salary for
the portion of the Contribution Determination Period during which
the Member satisfied the Employer's eligibility requirement(s),
if any, up to the Base Contribution Percentage for such
Contribution Determination Period, plus a uniform percentage of
each Member's Salary for the portion of the Contribution
Determination Period during which the Member satisfied the
Employer's eligibility requirement(s), equal to the Excess
Contribution Percentage.
(2) The Excess Contribution Percentage described in
Subparagraph (1) above may not exceed the lesser of (i) the Base
Contribution Percentage, or (ii) the greater of (1) 5.7% or (2)
the percentage equal to the portion of the Code Section 3111(a)
tax imposed on employers under the Federal Insurance
Contributions Act (as in effect as of the beginning of the Plan
Year) which is attributable to old-age insurance. For purposes of
this Subparagraph (2), "compensation" as defined in Section
414(s) of the Code shall be substituted for "Salary" in
determining the Excess Contribution Percentage and the Base
Contribution Percentage.
(3) The Employer may not adopt the Social Security
integration options provided above if any other integrated
defined contribution or defined benefit plan is maintained by the
Employer during any Contribution Determination Period.
(4) No contributions by Members shall be made under
the Profit Sharing Feature provided under this Section 8 of
Article III.
(D) (1) Contributions under the Profit Sharing Feature
shall be invested in accordance with the provisions and
procedures of Article IV, except as otherwise provided in this
Paragraph (D). At the Employer's election, contributions on
behalf of Members may be invested (i) entirely in Investment Fund
B or D, or (ii) pursuant to the Member's directions among the
Investment Funds. If the Employer
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does not so elect, or until an effective direction is made by
Members, all contributions made pursuant to this Article III,
Section 8, shall be invested in Investment Fund D.
(2) A Member's investment directions, if any, with
respect to contributions made under the Profit Sharing Feature,
shall be submitted in writing and shall be separate from the
directions submitted with respect to all other contributions
under the Plan.
(3) Where an Employer previously elected to invest
contributions pursuant to Article IV and subsequently elects to
have all future contributions invested entirely in Investment
Fund B or D in accordance with Subparagraph (D)(1) above, Units
previously accumulated in the Investment Funds prior to such
election will continue to be subject to the Members' investment
directions among such Investment Funds in accordance with Article
IV. All future Employer contribution allocations made following
the Employer's election shall be allocated to Investment Fund B
or D, respectively.
(E) (1) Except as otherwise provided under Article VII,
Section 2, no amounts may be withdrawn from a Member's Profit
Sharing Account while still employed by the Employer, other than
(i) amounts required to be distributed no later than April 1 of
the calendar year following the calendar year in which the Member
attains age 70 1/2, in accordance with Article VII, Section 3(C);
(ii) amounts required to be distributed pursuant to the terms of
a Qualified Domestic Relations Order, as defined in Article X,
Section 6 of the Plan; or (iii) amounts withdrawn on account of
mistake of fact, within one year after the payment of the
contribution, as reviewed and approved by the Thrift Plan Office.
(2) Subject to the provisions of Article VII,
Section 3 of the Plan, upon receipt by the Plan of a notice of
termination of Employment, a Member may request to withdraw any
or all vested Units in his Profit Sharing Account, including any
Units held in a Rollover Account for such Member, following the
filing of a notice of withdrawal with the Thrift Plan Office.
Subject to the provisions of Article VII, Section 3 and, to the
extent applicable, the provisions of Article III, Section 6(B)
(relating to transferred amounts and spousal consent), the normal
form of benefit payment under the Profit Sharing Account upon
receipt by the Plan of a notice of withdrawal is a lump sum
payment. In lieu of a lump sum payment upon termination, to the
extent permissible under Article VII, Section 3(B)(2), and, to
the extent applicable, the provisions of Article III, Section
6(B) (relating to transferred amounts and spousal consent), a
Member may elect in his notice of withdrawal to (i) defer
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receipt of some or all of his vested Profit Sharing Account until
April 1 of the calendar year following the calendar year in which
the Member attains 70 1/2 in accordance with Article VII, Section
3(C); (ii) elect installment payments, as described below; (iii)
if the Member's Employer has adopted the Plan after June 30, 1992
and has elected the annuity option under Section 3(B)(2) of
Article VII, or to the extent otherwise required under Article
III, Section 6(B) (relating to transferred amounts and spousal
consent), receive an annuity, subject to the provisions of
Section 3(B)(2) of Article VII (including spousal consent rules);
or (iv) make periodic withdrawals not more frequently than once
per year pursuant to the provisions of Article VII, Section 2.
Notwithstanding the provisions of Article VII, Section 3 (other
than Subsection (B)(2) thereof), any terminated Member with a
Profit Sharing Account balance equal to or greater than $3,500
may elect to be paid in up to 10 annual installments (or,
effective January 1, 1993, in 15 or 20 annual installments,
provided that a Member shall not be permitted to elect an
installment period in excess of his remaining life expectancy and
if a Member attempts such an election, he shall be deemed to have
elected the installment period with the next lowest multiple
within the Member's remaining life expectancy). The election of
installments under this Subparagraph (2) may not be subsequently
changed by the Member, except that the Member may request, in a
notice of withdrawal, to withdraw the balance of the Units in his
Profit Sharing Account as of the last day of any month.
(3) Payments made on account of a Member's death
shall be governed by the provisions contained in Article VII,
Section 5.
(4) Notwithstanding the provisions of this Article
III, Section 8, and subject to the provisions of Article VII,
Section 3(C), any benefit payable to a Member shall commence no
later than April 1 of the calendar year following the calendar
year in which such Member attains age 70 1/2.
(5) Where an Employer decides to no longer make
available the Profit Sharing Feature, as described in Article
III, Section 8, and adopts one of the options contained in
Article III, Sections 1 through 4 in lieu thereof, the investment
direction rights of Members with respect to their Profit Sharing
Accounts shall be in accordance with the investment direction
provisions of the Plan in effect immediately prior to such
Employer decision (in accordance with Article III, Section 8(D)),
unless otherwise specified by the Employer.
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(6) A transfer of funds may be made to the Profit
Sharing Feature from a prior retirement plan which was qualified
under Section 401(a) of the Code, subject to the provisions of
Article III, Sections 6(A) and (B) and such additional terms and
conditions as the Board shall approve. If the funds so
transferred are from a retirement plan which maintains employee
contributions, such transfer will not become effective until the
Employer either (i) returns such employee contributions to the
affected members prior to the transfer, or (ii) maintains the
prior trust to hold such employee contributions until such time
as they are fully distributed.
(7) Subject to the provisions of Article XI, an
Employer may terminate its participation in the Profit Sharing
Feature. Distributions shall be made in accordance with the
provisions of Article VII, Section 3.
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ARTICLE IV INVESTMENT OF CONTRIBUTIONS
All contributions to the Plan shall, upon receipt by the Board,
be delivered to the Trustee to be held in the Trust Fund and
invested and distributed by the Trustee in accordance with the
provisions of the Plan and Trust Agreement. The Trust Fund shall
consist of certain investment funds (each an "Investment Fund")
as described in the Trust Agreements and designated as follows:
"INVESTMENT FUND A" - A diversified equity portfolio with
the objective of simulating the performance of the Standard &
Poor's Composite Index of 500 stocks.
"INVESTMENT FUND B" - An income portfolio with the objective
of maximizing income at minimum risk of capital with
contributions invested in fixed income instruments, including,
but not limited to: (i) group annuity contracts including fixed
and variable rate contracts with insurance companies or other
financial institutions, (ii) bank time deposits or deposit
agreements, (iii) short term investment funds, (iv) U.S. Treasury
Bills and (v) third party agreements providing book value
liquidity for investments in U.S. Government or Agency securities
or collateralized mortgage obligations backed by Agency
collateral.
"INVESTMENT FUND C" - A diversified equity portfolio with
the objective of simulating the performance of the Standard &
Poor's MidCap Index of 400 stocks.
"INVESTMENT FUND D" - A government instrument fund with the
objective of maximizing income at minimum risk of capital with
underlying investments in obligations issued or guaranteed by the
United States government or agencies or instrumentalities
thereof.
"INVESTMENT FUND E" - A diversified debt portfolio with the
objective of simulating the performance of Lehman Brothers
Aggregate Bond Index.
A Trustee may in its discretion invest any amounts held by it in
any Investment Fund in any commingled or group trust fund
described in Section 401(a) of the Code and exempt under Section
501(a) of the Code or in any common trust fund exempt under
Section 584 of the Code, provided that such trust fund satisfies
the requirements of this Plan applicable to such investment fund
and that the Trustees serve as Trustee of such commingled, group
or common trust fund. To the extent that the Investment Funds are
at any time invested in any commingled, group or common trust
fund, the declaration of trust or other instrument pertaining to
such fund and any amendments thereto are hereby adopted as part
of this Agreement and deemed to form a part of the Plan.
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Except as provided in Article III, Section 8(D)(1), each Member
shall direct in writing that his contributions (including 401(k)
deferrals and rollover contributions, if any) and the
contributions made by his Employer (including Profit Sharing
contributions) on his behalf shall be invested (a) entirely in
any single Investment Fund or (b) in any combination of
Investment Funds in multiples of 5%. Until an effective direction
is made by the Member, all such contributions shall be invested
in Investment Fund D.
Any such investment direction shall be followed until changed.
Subject to the provisions of the following paragraphs of this
Section, one time during each month a Member may change his
investment direction as to future contributions and also as to
the value of his accumulated Units in the Investment Funds by
filing written notice with the Thrift Plan Office. Such directed
change will become effective upon the Valuation Date coinciding
with or next following the date which his notice was received by
the Thrift Plan Office subject to the same conditions with
respect to the amount to be transferred under this Section which
are specified in the Plan procedures for determining the amount
of payments made under Article VII, Section 1(A) of the Plan.
Except as otherwise provided below, a Member may not direct a
transfer of his accumulated units in Investment Fund B to
Investment Fund D and/or E. A Member may direct a transfer from
Investment Funds A and/or C to Investment Fund D and/or E
provided that, except as otherwise provided below, amounts
previously transferred from Investment Fund B following April 1,
1991, to Investment Funds A or C remain in such equity funds for
a period of three months prior to being transferred to Investment
Fund D or E.
Notwithstanding the above, a Member may direct a transfer from
Investment Fund B to Investment Fund D in multiples of 5% as of
April 30, 1991 by filing an irrevocable written notice on a form
supplied by the Thrift Plan Office with the Thrift Plan Office on
or before March 15, 1991. Notwithstanding any other provision in
the Plan to the contrary, amounts transferred or contributed to
Investment Fund B may not be distributed, borrowed or otherwise
withdrawn by the Member prior to July 1, 1991, unless the Member
terminates Employment. In the event that the aggregate amount
which Members have directed to be transferred from Investment
Fund B to Investment Fund D exceeds the amount the Board
determines to be available for such transfers under the
provisions of the investment contracts through which the assets
of Investment Fund B are invested, the Board shall limit, to such
extent as it may deem appropriate and in a uniform and
nondiscriminatory manner, the amount that any Member may so
transfer based on a proportion of the amount requested to be
transferred over the amount available to be transferred.
To the extent that the amount which a Member directs to be
transferred from Investment Fund B to Investment Fund D exceeds
the amount that the Board has determined he may transfer, he may
irrevocably elect,
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not later than March 15, 1991, in accordance with the form
supplied by the Thrift Plan Office, to transfer such excess
amounts (i) from Investment Fund B to Investment Funds A and/or C
as of April 30, 1991 and (ii) from Investment Funds A and/or C to
Investment Fund D as of the next following Valuation Date. If the
Member does not elect to transfer such excess amounts to the
equity funds, as of April 30, 1991, such excess amounts shall
remain in Investment Fund B and otherwise be held in accordance
with the provisions of the Plan.
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ARTICLE V MEMBERS' ACCOUNTS, UNITS AND VALUATION
An Account shall be established and maintained for each Member
showing his interests in the Investment Funds. The interest in
each Investment Fund shall be represented by Units. Separate
subaccounts shall be established and maintained for each Member,
as applicable, under (i) Article III, Section 8(B)(2) (Profit
Sharing Account), (ii) Article III, Section 4 (401(k) Account),
(iii) Article III, Section 2(C) (Regular Account). In addition, a
separate Rollover Account shall be established and maintained for
each Member or Employee who elects a rollover under Article III,
Section 6(C).
As of each Valuation Date, the value of a Unit in each Investment
Fund shall be determined by dividing (a) the sum of the net
assets at market value determined by the Trustee by (b) the total
number of outstanding Units.
The number of additional Units to be credited to a Member's
interest in each Investment Fund, as of any Valuation Date, shall
be determined by dividing (a) that portion of the aggregate
contributions by and on behalf of the Member which was directed
to be invested in such Investment Fund and received by the Board
during the month in which such Valuation Date occurs by (b) the
Unit value of such Investment Fund as of the next Valuation Date.
For purposes of the preceding sentence, in valuing a Member's
Account, contributions of both Members and their Employer which
have been reported and received by the Thrift Plan Office on the
first working day (as defined in Article III, Section 5) of a
month shall be deemed to have been received on the last working
day of the immediately preceding month. Working day shall be
defined as any day regular mail is delivered by the United States
Postal Service.
The value of a Member's Account may be determined as of any
Valuation Date by multiplying the number of Units to his credit
in each Investment Fund by the value of the Investment Fund Unit
on such date and aggregating the results.
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ARTICLE VI VESTING OF UNITS
SECTION 1. VESTING.
(A) All Units credited to a Member's Account shall
immediately and fully vest in him, except (i) Units credited to a
Member's Profit Sharing Account which shall vest in accordance
with the schedule adopted by his Employer under this Article and
(ii) Units attributable to contributions made by the Employer
after June 30 1992 under Section 2 or Section 3 of Article III,
with respect to which the Employer has elected to adopt a vesting
schedule as provided in this Article, which Units shall vest in
accordance with such schedule.
(B) An Employer may adopt a different vesting schedule for
its Members' (i) Profit Sharing Accounts, (ii) Matching Amounts
and (iii) Basic Amounts and Supplemental Amounts.
(C) In accordance with Subsection (A) above, one or more of
the following schedules may be elected by the Employer:
SCHEDULE 1: Applicable Units shall immediately and fully
vest. If the eligibility requirement(s) selected by the Employer
under Article II, Section 2(B), require(s) that an Employee
complete a period of Employment which is longer than 12
consecutive months, this vesting Schedule 1 shall be
automatically applicable.
SCHEDULE 2: Applicable Units shall become nonforfeitable
and fully vested in accordance with the schedule set forth below:
Completed Vested
Years of Employment Percentage
------------------- ----------
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
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SCHEDULE 3: Applicable Units shall become nonforfeitable
and fully vested in accordance with the schedule set forth below:
Completed Vested
Years of Employment Percentage
------------------- ----------
Less than 2 0%
5 or more 100%
SCHEDULE 4: Applicable Units shall become nonforfeitable
and fully vested in accordance with the schedule set forth below:
Completed Vested
Years of Employment Percentage
------------------- ----------
Less than 2 0%
3 or more 100%
SCHEDULE 5: Applicable Units shall become nonforfeitable
and fully vested in accordance with the schedule set forth below:
Completed Vested
Years of Employment Percentage
------------------- ----------
Less than 2 0%
1 but less than 2 25%
2 but less than 3 50%
3 but less than 4 75%
4 or more 100%
Notwithstanding the vesting schedules above, a Member's interest
in his Account shall become 100% vested in the event that (i) the
Member dies while in active Employment and the Plan has received
notification of death, (ii) the Member has been approved for
Disability, pursuant to the provisions of Article VII, Section 4,
and the Plan has received notification of Disability, or (iii)
the Member has attained Normal Retirement Age.
(D) VESTING ELECTION
(1) Except as otherwise provided in the next following
paragraph, in the event that the Employer adopts the Plan as a
successor plan to another defined contribution plan qualified
under Section 401(a) and 501(a) of the Code, or in the event that
the Employer changes or amends a vesting schedule adopted under
this Article, any Member who was
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covered under such predecessor plan or, in the case of a change
or amendment to the vesting schedule, any Member who has
completed at least 3 Years of Employment with such Employer, may
elect to have the nonforfeitable percentage of the portion of his
Account which is subject to such vesting schedule computed under
such predecessor plan's vesting provisions, or computed without
regard to such change or amendment (a "Vesting Election"). Any
Vesting Election made under this Section 1 shall be made by
notifying the Thrift Plan Office in writing within the election
period hereinafter described. The election period shall begin on
the date such amendment is adopted or the date such change is
effective, or the date the Plan which serves as a successor plan
is adopted or effective, as the case may be, and shall end no
earlier than the latest of the following dates: (i) the date
which is 60 days after the day such amendment is adopted; (ii)
the date which is 60 days after the day such amendment or change
becomes effective; (iii) the date which is 60 days after the day
the Member is given written notice of such amendment or change by
the Thrift Plan Office; (iv) the date which is 60 days after the
day the Plan is adopted by the Employer or becomes effective; or
(v) the date which is 60 days after the day the Member is give
written notice that the Plan has been designated as a successor
plan. Any election made pursuant to this Subsection (D) shall be
irrevocable.
(2) To the extent permitted under the Code and
Regulations, an Employer described in the foregoing paragraph may
elect to treat all of its Members who are eligible to make a
Vesting Election as having made such Vesting Election.
Furthermore, subject to the requirements of the applicable
Regulations, the Employer may elect to treat all its Members, who
were employed by the Employer on or before the effective date of
the change or amendment, as subject to the prior vesting
schedule, provided such prior schedule is more favorable.
SECTION 2. FORFEITURES.
(A) If a Member who was partially vested in his Account on
the date of his termination of Employment returns to Employment,
his years of Employment prior to the Break in Service shall be
included in determining future vesting and, if he returns before
incurring 5 consecutive one-year Breaks in Service, any Units
forfeited from his Account shall be restored to his Account;
provided, however, that if such a Member has received a
distribution pursuant to Article VII, Section 3 or Article III,
Section 8, his Account Units shall not be restored unless he
repays the full amount distributed to him to the Plan before the
earlier of (i) 5 years after the first date on which the Member
is subsequently reemployed by the Employer, or (ii) the close of
the first period
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of 5 consecutive one-year Breaks in Service commencing after the
withdrawal. The Units restored to the Member's Account will be
valued on the Valuation Date coincident with or next following
the later of (i) the date the Employee is rehired, or (ii) the
date a new enrollment application is received by the Thrift Plan
Office and (iii) the date the Employee repays the full amount
previously distributed to him that resulted in the forfeiture. If
a Member terminates Employment without any vested interest in his
Account, he shall (i) immediately be deemed to have received a
total distribution of his Account and (ii) thereupon forfeit his
entire Account; provided that if such Member returns to
Employment before the number of consecutive one-year Breaks in
Service equals or exceeds the greater of (i) 5, or (ii) the
aggregate number of the Member's Years of Service prior to such
Break in Service, his Account shall be restored in the same
manner as if such Member had been partially vested at the time of
his termination of Employment, and his Years of Employment prior
to incurring the first Break in Service shall be included in any
subsequent determination of his vesting service.
(B) Forfeited amounts, as defined in the preceding Paragraph
A, shall be made available to the Employer through transfer from
the Member's Account to the Employer Hold Account, upon: (1) if
the Member had a vested interest in his Account at his
termination of Employment, the earlier of (i) the date as of
which the Member receives a distribution of his entire vested
interest in his Account or (ii) the date upon which the Member
incurs 5 consecutive one-year Breaks in Service or (2) the date
of the Member's termination of Employment, if the Member then had
no vested interest in his Account. Once so transferred, such
amounts shall be used at the option of the Employer to (i) reduce
administrative expenses (in accordance with Article IX, Section
2) for that Contribution Determination Period, (ii) offset any
contribution to be made by such Employer for that Contribution
Determination Period, or (iii) be allocated to all eligible
Members at the end of such Contribution Determination Period in
accordance with clause (ii) of the first sentence in Article III,
Section 8(C)(1). The Employer Hold Account, referenced in this
Paragraph (B), shall be maintained to receive, in addition to the
forfeitures described above, (i) contributions in excess of the
limitations contained in Section 415 of the Code, as described in
Article X, Section 1(C), and (ii) Employer contributions made in
advance of the date allocable to Members.
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ARTICLE VII WITHDRAWAL PAYMENTS
SECTION 1. GENERAL.
(A) All payments in respect of a Member's Account shall be
made in cash from the Trust Fund and in accordance with the
provisions of this Article or Articles XI or XII or Article III,
Section 4. The amount of payment will be determined in accordance
with the Unit values on the Valuation Date coinciding with or
next following the date proper notice is filed with the Board,
unless following such Valuation Date a decrease in the Unit
values of the Member's investment in any of the Investment Funds
occurs prior to the date such Units of the Member are redeemed in
which case that part of the payment which must be provided
through the sale of existing Units shall equal the value of such
Units determined on the date of redemption which date shall occur
as soon as administratively practicable on or following the
Valuation Date such proper notice is filed with the Board. The
redemption date Unit value with respect to a Member's investment
in any Investment Fund shall equal the value of a Unit in such
Investment Fund, as determined in accordance with the valuation
method applicable to Unit investments in such Fund on the date
the Member's investment is redeemed.
Payments provided under this Section will be made in a lump
sum as soon as practicable after such Valuation Date or date of
redemption, as may be applicable, subject to, with respect to
amounts invested in Investment Fund B, if applicable, the
provisions of Article XI, Section 3 regarding the transfer of
guaranteed interest contracts, and with respect to amounts
invested in any other Investment Fund, subject to any other
applicable restriction on redemption imposed on amounts invested
in such Fund.
(B) At the election of the Employer, the Employer can suspend
matching contributions to the Plan on behalf of a Member, during
his uninterrupted period of Service with such Employer, who makes
a withdrawal from his Regular Account for a period of 6 months
after such withdrawal, except that (i) if the withdrawal does not
exceed the amount of the Member's contributions in his Regular
Account plus earnings thereon, Employer contributions on his
behalf may resume 3 months after such withdrawal, and (ii) if the
withdrawal does not exceed the amount, if any, of the Member's
contributions in his Regular Account made prior to January 1,
1987 without earnings, then Employer contributions on his behalf
shall not be affected by such withdrawal.
(C) Any partial withdrawal from a Member's Regular Account or
Rollover Account shall be in an amount of at least $1,000 or
shall be for the full amount of either (a) the Member's
contributions made prior to January 1, 1987 without earnings or
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(b) the Member's contributions plus earnings thereon. Any partial
withdrawal shall be deemed to come first from the Member's
contributions made prior to January 1, 1987 without earnings
referred to in (ii) above, second proportionately from the Member
contributions made after December 31, 1986 plus earnings thereon,
and finally from the balance of his Regular Account or Rollover
Account.
(D) Any amounts paid under this Article may not be returned
to the Plan.
SECTION 2. ACCOUNT WITHDRAWAL WHILE EMPLOYED.
A Member may voluntarily withdraw his Account (other than his
401(k) Account, Profit Sharing Account, or Profit Sharing
Rollover Amounts, if any) while in Employment by filing a notice
of withdrawal with the Thrift Plan Office; provided, however,
that in the event his Employer has elected to provide annuity
options under Article VII, Section 3(B)(2), no withdrawals may be
made from a married Member's Account without the written consent
of such Member's Spouse (which consent shall be subject to the
procedures set forth in Article III, Section 6(B)). Only one
in-service withdrawal under this Section may be made in any Plan
Year from each of the Member's Regular Account and Rollover
Account. This restriction shall not, however, apply to a
withdrawal of a Member's contributions made prior to January 1,
1987 without earnings, or a withdrawal under this Section in
conjunction with a hardship withdrawal as defined under Article
III, Section 4(H).
Notwithstanding the foregoing paragraph, a Member shall not
withdraw any Matching, Basic or Supplemental contributions made
by his Employer under Article III, Section 2 or Section 3 and
credited to his Regular Account unless (i) the Member has
completed 60 months of participation in the Plan, (ii) the
withdrawal occurs at least 24 months after such Matching, Basic
or Supplemental contributions were made by the Employer, (iii)
the Member's Employer terminates its participation in the Plan or
(iv) the Member dies, is disabled, retires, terminates Employment
or attains age 59 1/2. For purposes of the preceding
requirements, if the Member's Account includes amounts which have
been transferred from a defined contribution plan established
prior to the adoption of the Plan by the Member's Employer, the
period of time during which amounts were held on behalf of such
Member and the periods of participation of such Member under such
defined contribution plan shall be taken into account.
SECTION 3. ACCOUNT WITHDRAWAL UPON TERMINATION OF EMPLOYMENT OR
EMPLOYER PARTICIPATION.
(A) Except as provided in Article III, Sections 4 and 8, a
Member who terminates Employment with a participating Employer,
or whose Employer terminates its participation in the Plan under
Article XI, may withdraw his Account at any time thereafter up to
attainment of age 70 1/2 or, if elected by his Employer in
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accordance with the provisions of Article XI, Section 3, may
transfer his Account, including all outstanding loan balances, to
a qualified successor plan maintained by his Employer following
the termination by the Employer of its participation under the
Plan; provided, however, that the Member may not transfer
outstanding loan balances unless such qualified successor plan
provides participant loans. For purposes of this Section 3, a
qualified successor plan is an employee benefit plan established
or maintained by the Employer which (i) has received a favorable
determination letter from the IRS stating that such plan
satisfies the then current qualification and tax-exemption
requirements of the Code or with respect to which an opinion of
counsel to the same effect, and in such form as may be
satisfactory to the Thrift Plan Office, (ii) has provided the
Thrift Plan Office with written certification by its appropriate
fiduciaries that in the event of a transfer to such successor
plan of the withdrawn assets, the successor plan shall be fully
liable for the payment of all transferred benefits of the Members
of such Employer (who consent to the transfer), and that the Plan
shall not be liable for the payment of any part of such benefits,
(iii) has provided each Member's written consent to the transfer
and his release of all claims against the Plan arising out of his
membership therein, (iv) meets such other requirements of the
IRS, other appropriate governmental authority or of the Board,
which may apply, and (v) meets such other procedures as may be
established by the Board from time to time.
Any withdrawal under this Section requires that a notice of
withdrawal be filed with the Thrift Plan Office. If a Member does
not file such notice, the value of his Account will be paid to
him as soon as practicable after his attainment of age 70 1/2 but
in no event shall payment commence later than April 1 of the
calendar year following the calendar year in which the Member
attains age 70 1/2, unless otherwise provided by law. Only one
withdrawal under this Section may be made in any calendar year
from each of the Member's Rollover Account, Profit Sharing
Account, 401(k) Account and Regular Account.
(B) (1) In lieu of any lump sum payment of his total
Account, a Member who has terminated his Employment may elect in
his notice of withdrawal to be paid in up to 10 annual
installments (or, effective January 1, 1993, in 15 or 20 annual
installments, provided that a Member shall not be permitted to
elect an installment period in excess of his remaining life
expectancy and if a Member attempts such an election, he shall be
deemed to have elected the installment period with the next
lowest multiple within the Member's remaining life expectancy),
subject to the provisions of Article X, Section 4. The amount of
each installment will be equal to the value of the total Units in
the Member's Account, multiplied by a fraction, the numerator of
which is one and the denominator of which is
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the number of remaining annual installments including the one
then being paid, so that at the end of the installment period so
elected, the total Account will be liquidated. The value of the
Units will be determined in accordance with the Unit values on
the Valuation Date on or next following the Thrift Plan Office's
receipt of his notice of withdrawal and on each anniversary
thereafter. Payment will be made as soon as practicable after
each such Valuation Date, but in no event shall payment commence
later than April 1 of the calendar year following the calendar
year in which the Member attains age 70 1/2 subject to Paragraph
(C) below. The election of installments hereunder may not be
subsequently changed by the Member, except that upon written
notice to the Thrift Plan Office, the Member may withdraw the
balance of the Units in his Account in a lump sum at any time.
(2) ANNUITY OPTION. An Employer who adopts the Plan
after June 30, 1992 may, at its option, elect to provide an
annuity option in addition to the lump sum payment and
installment payment options described in Section 1(A) and
Subsection (B)(1) above. In the event an Employer elects to
provide an annuity option, the following provisions shall apply:
UNMARRIED MEMBERS: Any unmarried Member who has
terminated his Employment may elect, in lieu of any lump sum or
installment payment of his total Account(s) under Section 1(A) or
Subsection (B) above, to receive a benefit payable by purchase
from an insurance company of a single premium contract providing
for (i) a single life annuity for the life of the Member or (ii)
an annuity for the life of the Member and, if the Member dies
leaving a designated Beneficiary, a 50% survivor annuity for the
life of such designated Beneficiary.
MARRIED MEMBERS: Except as otherwise provided below,
(i) any married Member who has terminated his Employment shall
receive a benefit payable by purchase from an insurance company
of a single premium contract providing for a Qualified Joint and
Survivor Annuity, as defined under Section 6(B)(1) of Article III
and (ii) the Surviving Spouse of any married Member who dies
prior to the date payment of his benefit commences shall be
entitled to a Preretirement Survivor Annuity, as defined under
Section 6(B)(4) of Article III. Notwithstanding the foregoing,
any such married Member may elect to receive his benefit in any
other available form, and may waive the Preretirement Survivor
Annuity, in accordance with the spousal consent provisions of
Section 6(B) of Article III.
(C) In no event may payment of a Member's Account begin later
than April 1 of the year following the calendar year in which a
Member
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attains age 70 1/2; provided, however, if a Member attained age
70 1/2 prior to January 1, 1988, except as otherwise provided
below, any benefit payable to such Member shall commence no later
than the April 1 of the calendar year following the later of (i)
the calendar year in which the Member attains age 70 1/2 or (ii)
the calendar year in which the Member retires.
If a Member who is a 5% owner attained age 70 1/2 before January
1, 1988, any benefit payable to such Member shall commence no
later than the April 1 of the calendar year following the later
of (i) the calendar year in which the Member attains age 70 1/2
or (ii) the earlier of (A) the calendar year within which the
Member becomes a 5% owner or (B) the calendar year in which the
Member retires. For purposes of the preceding sentence, 5% owner
shall mean a 5% owner of such Member's Employer as defined in
Section 416(i) of the Code at any time during the Plan Year in
which such owner attains age 66 1/2 or any subsequent Plan Year.
Distributions must continue to such Member even if such Member
ceases to own more than 5% of the Employer in a subsequent year.
Unless the Member elects otherwise, distribution of benefits will
begin no later than the 60th day after the latest of the close of
the Plan Year in which (i) the Member attains age 65; (ii) occurs
the 10th anniversary of the year in which the Member commenced
participation in the Plan; or (iii) the Member terminates
Employment with an Employer. Notwithstanding the foregoing, the
failure of a Member and Spouse to consent to a distribution while
a benefit is immediately distributable shall be deemed to be an
election to defer commencement of payment of any benefit.
(D) This Subsection (D) applies to distributions made on or
after January 1, 1993. Solely to the extent required under
applicable law and regulations, and notwithstanding any provision
of the Plan to the contrary that would otherwise limit a
Distributee's election under this Subsection (D), a Distributee
may elect, at the time and in the manner prescribed by the Board,
to have any portion of an Eligible Rollover Distribution paid
directly to an Eligible Retirement Plan specified by the
Distributee in a Direct Rollover.
For purposes of this Subsection (D), the following terms shall
have the following meanings:
(1) ELIGIBLE ROLLOVER DISTRIBUTION: Solely to the extent
required under applicable law and regulations, 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
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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 includible in gross income (determined
without regard to the exclusion for net unrealized appreciation
with respect to employer securities).
(2) 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, an annuity plan described in Section 403(a)
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 a Surviving Spouse, an Eligible Retirement Plan
is an individual retirement account or individual retirement
annuity.
(3) 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.
(4) DIRECT ROLLOVER: A Direct Rollover is a payment by the
Plan to the Eligible Retirement Plan specified by the
Distributee.
SECTION 4. ACCOUNT WITHDRAWAL UPON MEMBER'S DISABILITY.
(A) A Member who is separated from Employment by reason of a
disability which is expected to last in excess of 12 consecutive
months and who is either (i) eligible for, or is receiving,
disability insurance benefits under the Federal Social Security
Act, (ii) approved for disability under the provisions of The
Comprehensive Retirement Program of the Financial Institutions
Retirement Fund (a defined benefit pension plan through which
federally insured financial institutions and organizations
serving them may cooperate in providing for the retirement of
their employees), or (iii) approved for disability under the
provisions of any other benefit program or policy maintained by
his Employer, which policy or program is applied on a uniform and
nondiscriminatory basis to all Employees of such Employer, shall
be deemed to be disabled for all purposes under the Plan.
(B) The Thrift Plan Office shall determine whether a Member
is disabled in accordance with the terms of Paragraph (A) above;
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provided, however, approval of Disability is conditioned upon
notice to the Thrift Plan Office of such Member's Disability by
the Employer within 13 months of the Member's separation from
Employment. The notice of Disability shall include a
certification that the Member meets one or more of the criteria
listed in Paragraph (A) above.
(C) Upon an Employer's filing a written notice of Disability,
a Member may withdraw his total Account balance under the Plan
(including his Rollover Account and/or total Profit Sharing
Account balance, if any) and have such amounts paid to him in
accordance with Article VII, Section 3. In lieu of such lump sum
payment, the Member may elect in his notice of withdrawal to (i)
defer receipt of some or all of his vested Account until April 1
of the calendar year following the calendar year in which the
Member attains 70 1/2 (ii) elect installment payments, as
described in Section 3(B) of this Article and Article III,
Section 8(E)(2), or (iii) make periodic withdrawals not more
frequently than once per year pursuant to the provisions of
Article VII, Section 1; provided, however, if a disabled Member
becomes reemployed subsequent to withdrawal of some or all of his
Account balance, such Member may not repay to the Plan any such
withdrawn amounts.
SECTION 5. MEMBER'S DEATH.
(A) Subject to Section 3(B)(2) above, if a married Member
dies, his Spouse, as Beneficiary, will receive a death benefit
equal to the value of the Member's Account determined on the
Valuation Date on or next following the Board's receipt of notice
that such Member died; provided, however, that if such Member's
Spouse had consented in writing to the designation of a different
Beneficiary, the Member's Account will be paid to such designated
Beneficiary. Such nonspousal designation may be revoked by the
Member without spousal consent at any time prior to the Member's
death. If a Member is not married at the time of his death, his
Account will be paid to his designated Beneficiary.
(B) Subject to Section 3(B)(2) above, a Member may elect that
upon his death, his Beneficiary, pursuant to Paragraph (A) above,
may receive, in lieu of any lump sum payment, payment in 5 annual
installments (10 if the Spouse is the Beneficiary, provided that
the Spouse's remaining life expectancy is at least 10 years)
whereby the value of 1/5th of such Member's Units (or 1/lOth in
the case of a spousal Beneficiary, provided that the Spouse's
remaining life expectancy is at least 10 years) in each
Investment Fund will be determined in accordance with the Unit
values on the Valuation Date on or next following the Board's
receipt of notice of the Member's death and on each anniversary
of such Valuation Date. Payment will be made as soon as
practicable after each Valuation Date until the Member's Account
is exhausted. Such election may be filed at any time with the
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Board prior to the Member's death and may not be changed or
revoked after such Member's death. If such an election is not in
effect at the time of the Member's death, his Beneficiary
(including any spousal Beneficiary) may elect to make withdrawals
in accordance with this Article, except that any balance
remaining in the deceased Member's Account must be withdrawn on
or before the December 31 of the calendar year which contains the
5th anniversary (the 10th anniversary in the case of a spousal
Beneficiary, provided that the Spouse's remaining life expectancy
is at least 10 years) of the Member's death. Notwithstanding the
foregoing provisions of this Paragraph (B), payment of a Member's
Account shall commence not later than the December 31 of the
calendar year immediately following the calendar year in which
the Member died or, in the event such Beneficiary is the Member's
Surviving Spouse, on or before the December 31 of the calendar
year in which such Member would have attained age 70 1/2, if
later (or, in either case, on any later date prescribed by the
IRS Regulations). If, upon the Spouse's or Beneficiary's death,
there is still a balance in the Account, the value of the
remaining Units will be paid in a lump sum to such Spouse's or
Beneficiary's estate. Notwithstanding anything in this Subsection
(B) to the contrary, if a Member dies after distribution of his
or her interest has begun, the remaining portion of such interest
will continue to be distributed at least as rapidly as under the
method of distribution being used prior to the Member's death. In
addition, to the extent any payments from a Member's Account
would be made after a Member's death to a beneficiary other than
the Member's Spouse, such payments shall be made in accordance
with Section 401(a)(9) of the Code and the IRS Regulations
thereunder. In addition, to the extent any payments from a
Member's Account would be made after a Member's death, such
payments shall be made in accordance with Section 401(a)(9) of
the Code and the IRS Regulations thereunder (including the
minimum distribution incidental benefit requirements).
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ARTICLE VIII LOAN PROGRAM
SECTION 1. GENERAL.
An Employer may, at its option, make available this loan program
for any Member (and, if applicable under Section 8 of this
Article, any Beneficiary), subject to applicable law, except that
(i) no loans may be made from a Member's Profit Sharing Account
as set forth in Article III, Section 8 or from a Member's Profit
Sharing Rollover Amounts, if any and (ii) in the event his
Employer has elected to provide annuity options under Article
VII, Section 3(B)(2), or amounts are transferred to the Plan from
a retirement plan subject to Section 401(a)(11) of the Code, no
loans may be made from a married Member's Account without the
written consent of such Member's Spouse which shall be obtained
no earlier than the beginning of the 90-day period that ends on
the date on which the loan is to be secured by any portion of
such Member's Account. The consent must be in writing, must
acknowledge the effect of the loan, and must be notarized. Such
consent shall thereafter be binding with respect to the
consenting Spouse or any subsequent Spouse with respect to that
loan. In the event an Employer elects the loan program under this
Article VIII, loans shall be available from the Rollover Accounts
of any Employees of the Employer who have not yet become Members.
SECTION 2. LOAN APPLICATION.
(A) Subject to the restrictions described in Paragraph (B) of
this Section, a Member in Employment may borrow from his Account
in the Investment Funds by filing an application with the Thrift
Plan Office. Such application (hereinafter referred to as a
"completed application") shall (i) specify the terms pursuant to
which the loan is requested to be made and (ii) provide such
information and documentation as the Board shall require,
including a note, duly executed by the Member, granting a
security interest of an amount not greater than 50% of his vested
Account, to secure the loan. With respect to such Member, the
completed application shall authorize the repayment of the loan
through payroll deductions. Such loan will become effective upon
the Valuation Date coinciding with or next following the date on
which his completed application and other required documents were
received by the Thrift Plan Office, subject to the same
conditions with respect to the amount to be transferred under
this Section which are specified in the Plan procedures for
determining the amount of payments made under Article VII,
Section 1(A) of the Plan.
(B) The Board shall establish standards in accordance with
the Code and ERISA which shall be uniformly applicable to all
Members eligible to borrow from their interests in the Trust Fund
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similarly situated and shall govern the approval or disapproval
of completed applications. The terms for each loan shall be set
solely in accordance with such standards.
(C) In accordance with the Board's established standards,
each completed application shall be reviewed and approved or
disapproved as soon as practicable after the receipt thereof, and
the applying Member shall be promptly notified of such approval
or disapproval. Notwithstanding the foregoing, the review of a
completed application, or payment of the proceeds of an approved
loan, may be deferred if the proceeds of the loan would otherwise
be paid during the period commencing on December 1 and ending on
the following January 31.
(D) Subject to Paragraph (C) of this Section and Paragraph
(C) of Section 6 of this Article VIII, upon approval of a
completed application, payment of the loan to the Member shall be
made from the Investment Fund(s) in the same proportion that the
Member's Regular Account, 401(k) Account and/or Rollover Account,
as applicable, are invested at the time of the loan, and the
relevant portion of the Member's interest in such Investment
Fund(s) shall be cancelled and shall be transferred in cash to
the Member. The Thrift Plan Office shall maintain sufficient
records regarding such amounts to permit an accurate crediting of
repayments of the loan.
SECTION 3. PERMITTED LOAN AMOUNT.
The amount of each loan may not be less than $1,000 nor more than
the maximum amount as described below. The maximum amount
available for loan under the Plan (when added to the outstanding
balance of all other loans from the Plan to the borrowing Member)
shall not exceed the lesser of: (a) $50,000 reduced by the excess
(if any) of (i) the highest outstanding loan balance attributable
to the Account of the Member requesting the loan from the Plan
during the one-year period ending on the day preceding the date
of the loan, over (ii) the outstanding balance of all other loans
from the Plan to the Member on the date of the loan, or (b) 50
percent of the value of the Member's vested Account (excluding
the Member's interest in his Profit Sharing Account and his
Profit Sharing Rollover Amounts, if any) based on the latest
available information on the date on which the Thrift Plan Office
receives the completed application for the loan and other
required documents. The maximum amount available for a loan for
purposes of item (b) of the preceding sentence shall be
determined by valuing the Member's interest in his 401(k)
Account, his Regular Account and his Rollover Account, as of the
applicable Valuation Date, regardless of whether the 401(k)
Account is available for loan, provided that, with respect to
Members whose Employer has not elected to make the 401(k) Account
available for loans, then in no event shall the amount of the
loan exceed the value of such Member's Regular Account and his
Rollover Account.
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SECTION 4. SOURCE OF FUNDS FOR LOAN.
The amount of the loan will be deducted from the Member's Account
in the Investment Funds in accordance with Section 2(D) of this
Article and the Plan procedures for determining the amount of
payments made under Article VII, Section 1(A). If an Employer
elects to make loans available both from a Member's Regular
Account and his 401(k) Account, the Member may designate the
account from which the loan shall be allocable. Notwithstanding
the foregoing, effective January 1, 1993, a Member or Employee
whose Employer has elected the loan program under this Article
VIII may also designate that his loan be made from his Rollover
Account. The account from which the Member first chooses to
borrow must be exhausted before the Member can borrow any amount
from the other account. A loan from either the 401(k) Account or
the Regular Account will first be allocable out of amounts not
previously taxed and then, to the extent necessary, out of the
Member's Regular contributions (if any).
SECTION 5. CONDITIONS OF LOAN.
(A) Each loan to a Member under the Plan shall be repaid in
level monthly amounts through regular payroll deductions after
the effective date of the loan, and continuing thereafter with
each payroll. Except as otherwise required by the Code and the
IRS Regulations, each loan shall have a repayment period of not
less than 24 months and not in excess of 60 months.
Notwithstanding the foregoing, each loan made after December 31,
1992 shall have a repayment period of (i) at least 12 months and
(ii) if the purpose of the loan is the purchase of a primary
residence, not more than 180 months.
(B) The rate of interest for the term of the loan will be
established as of the loan date, and will be the Barron's Prime
Rate (base rate) plus 1% as published on the last Saturday of the
preceding month, or such other rate as may be required by
applicable law and determined by reference to the prevailing
interest rate charged by commercial lenders under similar
circumstances. The applicable rate would then be in effect
through the last business day of the month.
(C) Repayment of all loans under the Plan shall be secured by
50% of the Member's vested interest in his Regular Account, his
401(k) Account and his Rollover Account, if any, determined as of
the origination of such loan; provided, however, that repayment
shall be secured by the Member's interest in his 401(k) Account,
to the extent applicable, only for such time, and to the extent
that, a portion of such loan is allocated to such account.
(D) Only one loan may be made to a Member in the Plan Year
from each of his (i) Rollover Account and (ii) 401(k) Account and
Regular Account.
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SECTION 6. CREDITING OF REPAYMENT.
(A) Upon lending any amount to a Member, the Board shall
establish and maintain a loan receivable account with respect to,
and for the term of, the loan. The allocations described in this
Section shall be made from the loan receivable account.
(B) Upon receipt of each monthly installment payment and the
crediting thereof to the Member's loan receivable account, there
shall be allocated to the Member's Account in the Investment
Funds in accordance with his most recent investment instructions,
the principal portion of the installment payment plus that
portion of the interest equal to the rate determined in Section
5(B) of this Article, less 2%.
(C) The unpaid balance owed by a Member on a loan under the
Plan shall not reduce the amount credited to his Account.
However, from the time of payment of the proceeds of the loan to
the Member, such Account shall be deemed invested, to the extent
of such unpaid balance, in such loan until the complete repayment
thereof or distribution from such Account. Any loan repayment
shall first be deemed allocable to a Member's Regular Account
contributions, then earnings on such Member's Regular Account
contributions and finally Employer contributions plus earnings.
Notwithstanding the preceding sentence, any loan repayment of
amounts derived from a Member's 401(k) Account, Regular Account
and Rollover Account shall be applied to such accounts on a
proportionate basis that reflects the allocable portion of those
Member accounts deemed invested in the loan.
SECTION 7. CESSATION OF PAYMENTS ON LOAN.
(A) If a Member, while employed, fails to make a monthly
installment payment when due, as specified in the completed
application, subject to applicable law, he will be deemed to have
received a distribution of the outstanding balance of the loan.
If such default occurs after the first 24 monthly payments (or,
effective January 1, 1993, the first 12 monthly payments) of the
loan have been satisfied, the Member may pay the outstanding
balance, including accrued interest from the due date, within 60
days of the due date of the last monthly installment payment, in
which case no such distribution will be deemed to have occurred.
Subject to applicable law, notwithstanding the foregoing, a
Member that borrows amounts from his 401(k) Account may not cease
to make monthly installment payments while employed and receiving
a Salary from the Employer.
(B) Except as otherwise provided under Section 8 below, upon
a Member's termination of Employment, death or Disability, or the
termination of his Employer's participation in the Plan, no
further monthly installment payments may be made. Unless the
outstanding balance, including accrued interest from the due
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date, is paid within 60 days of the date of such occurrence, the
Member will be deemed to have received a distribution of the
outstanding balance of the loan including accrued interest from
the due date. This Subsection (B) shall also apply to a Member
(i) whose Employer terminates its participation in the Plan
without establishing or maintaining a qualified successor plan
(as defined in Article VII, Section 3) to which the Member's
Account could be transferred, (ii) who elects not to transfer the
total accumulated balance of his Account to such qualified
successor plan, as provided under Article VII, Section 3(A),
where the Employer has satisfied all conditions and requirements
to permit such transfer, or (iii) who fails to transfer
outstanding loan balances as provided under Article VII, Section
3(A)(2).
SECTION 8. LOANS TO FORMER MEMBERS AND BENEFICIARIES.
Notwithstanding any other provisions of this Article VIII, (i)
effective July 1, 1992, a Member who terminates Employment for
any reason or whose Employer terminates participation in the Plan
(a "Terminated Member") shall be permitted to continue making
scheduled repayments with respect to any loan balance outstanding
at the time he becomes a Terminated Member and (ii) effective
November 1, 1992, any Terminated Member (or Beneficiary) shall be
permitted to borrow from his Account if his Employer (or the
Employer of the Member with respect to whom he is a Beneficiary)
permitted loans under the Plan at the time he became a Terminated
Member (or became entitled to benefits as a Beneficiary). If any
individual who continues to make repayments or who borrows from
his Account pursuant to this Section 8 fails to make a monthly
installment payment within 60 days of the scheduled payment date,
he will be deemed to have received a distribution of the
outstanding balance of the loan.
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ARTICLE IX ADMINISTRATION OF PLAN
SECTION 1. BOARD OF DIRECTORS.
(A) The general administration of the Plan and the general
responsibility for carrying out the provisions of the Plan shall
be placed in a Board of Directors who must be Members of the
Plan. The President of the Plan shall be the chief administrative
officer of the Plan, a member ex officio of the Board and, for
purposes of ERISA, the "plan administrator. " The Board shall
constitute the "named fiduciary" for purposes of ERISA. The Board
may adopt, and amend from time to time, by-laws not inconsistent
with the Trust and the Plan and shall have such duties and
exercise such powers as are provided in the Plan, Trust Agreement
and by-laws. The number of Directors, their method of election
and their terms of office shall be governed by such by-laws. The
Board shall hold an annual meeting each year and may hold
additional meetings from time to time.
(B) The Board members shall serve without compensation, but
shall be reimbursed for any reasonable expenses incurred in their
capacities as Board members. Neither the Plan Administrator, nor
any Board member, officer or employee of the Plan shall be
personally liable by virtue of any contract or other instrument
executed by him or on his behalf in such capacity nor for any
mistake of judgment made in good faith. Each Employer, by its
participation in the Plan, agrees that each member of the Board
and officer and employee of the Plan shall be indemnified by the
Employer for any liability, in excess of that which is covered by
insurance, arising out of any act or omission to act in
connection with the Plan, except for fraud or willful misconduct.
The obligation to pay any such expense shall be allocated among
the Employers by the Board in such manner as the Board deems
equitable.
(C) The Board shall elect from its membership a chairman and
a vice-chairman of the Board, and shall elect such other officers
of the Plan as the Board deems desirable. The Board may appoint
committees and shall arrange for such legal, accounting,
investment advisory or management, administrative and other
services as it deems appropriate to carry out the Plan, and may
act in reliance upon the advice and actions of the persons or
firms providing such services. The Board may delegate to any
committee, officer, employee or agent the authority to perform
any act pertaining to the Plan or the administration thereof. No
Employer shall under any circumstances or for any purpose be
deemed an agent of the Board. The Board shall cause to be
maintained proper accounts and accounting procedures and shall
submit an Annual Report on the operations of the Plan to each
Employer for the information of its members. The Board may adopt
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by-laws governing the conduct of its affairs and may amend such
by-laws from time to time.
(D) The Board shall have the exclusive right to interpret the
Plan and to determine any question arising under or in connection
with the administration of the Plan. Its decision or action in
respect thereof shall be conclusive and binding upon all persons
having an interest in the Trust or under the Plan. The Board
shall have no duty to see that contributions received by the
Trustee under the Plan comply with the provisions of the Plan,
nor any duty to enforce payment of any contributions under the
Plan.
(E) (1) All claims for benefits under the Plan shall be
submitted in writing to, and within a reasonable period of time
decided by, the President of the Plan. If the claim is wholly or
partially denied, written notice of the denial shall be furnished
within 90 days after receipt of the claim; provided that, if
special circumstances require an extension of time for processing
the claim, an additional 90 days from the end of the initial
period shall be allowed for processing the claim, in which event
the claimant shall be furnished with a written notice of the
extension prior to the termination-of the initial 90-day period
indicating the special circumstances requiring an extension. The
written notice denying the claim shall set forth the reasons for
the denial, including specific reference to pertinent provisions
of the Plan on which the denial is based, a description of any
additional information necessary to perfect the claim and
information regarding review of the claim and its denial.
(2) A claimant may review all pertinent documents and
may request a review by the Board, at the office of the Plan, of
a decision denying the claim. Such a request shall be made in
writing and filed with the Board within 60 days after delivery to
the claimant of written notice of the decision. Such written
request for review shall contain all additional information which
the claimant wishes the Board to consider. The Board may hold a
hearing or conduct an independent investigation, and the decision
on review shall be made as soon as possible after the Board's
receipt of the request for review. Written notice of the decision
on review shall be furnished to the claimant within 60 days after
receipt by the Board of a request for review, unless special
circumstances require an extension of time for processing, in
which event an additional 60 days shall be allowed for review and
the claimant shall be so notified in writing. Written notice of
the decision on review shall include specific reasons for the
decision. For all purposes under the Plan, such decision on
claims (where no review is requested) and decision on review
(where review
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is requested) shall be final, binding and conclusive on all
interested persons as to participation and benefits eligibility,
the amount of benefits and as to any other matter of fact or
interpretation relating to the Plan.
SECTION 2. TRUST AGREEMENT.
(A) The Board shall enter into one or more Trust Agreements
with a Trustee or Trustees selected by the Board. The Trust
established under any such agreement shall be a part of the Plan
and shall provide that all funds received by the Trustee as
contributions under the Plan and the income therefrom (other than
such part as is necessary to pay the expenses and charges
referred to in Paragraph (B) of this Section) shall be held in
the Trust Fund for the exclusive benefit of the Members or their
Beneficiaries, and managed, invested and reinvested and
distributed by the Trustee in accordance with the Plan. Sums
received for investment may be invested (i) wholly or partly
through the medium of any common, collective or commingled trust
fund maintained by a bank or other financial institution and
which is qualified under Sections 401(a) and 501(a) of the Code
and constitutes a part of the Plan, or (ii) wholly or partly
through the medium of a group annuity or other type of contract
issued by an insurance company and constituting a part of the
Plan, and utilizing, under any such contract, general, commingled
or individual investment accounts. Subject to the provisions of
Article XII, the Board may from time to time and without the
consent of any Employer, Member or Beneficiary (a) amend the
Trust Agreement or any such insurance contract in such manner as
the Board may deem necessary or desirable to carry out the Plan,
(B) remove the Trustee and designate a successor Trustee upon
such removal or upon the resignation of the Trustee, and (c)
provide for an alternate funding agency under the Plan. The
Trustee shall make payments under the Plan only to the extent, in
the amounts, in the manner, at the time, and to the persons as
shall from time to time be set forth and designated in written
authorizations from the Board.
(B) The Trustee shall from time to time charge against and
pay out of the Trust Fund taxes of any and all kinds whatsoever
which are levied or assessed upon or become payable in respect of
such Fund, the income or any property forming a part thereof, or
any security transaction pertaining thereto. To the extent not
paid by the Employers, the Trustee shall also charge against and
pay out of the Trust Fund other expenses incurred by the Trustee
in the performance of its duties under the Trust, the expenses
incurred by the Board in the performance of its duties under the
Plan (including reasonable compensation for agents and cost of
services rendered in respect of the Plan), such compensation of
the Trustee as may be agreed upon from time to time between the
Board and the Trustee, and all other proper charges and
disbursements of the Trustee or the Board.
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ARTICLE X MISCELLANEOUS PROVISIONS
SECTION 1. GENERAL LIMITATIONS.
(A) In order that the Plan be maintained as a qualified plan
and trust under the Code, contributions in respect of a Member
shall be subject to the limitations set forth in this Section,
notwithstanding any other provision of the Plan. The
contributions in respect of a Member to which this Section is
applicable are his own contributions and his Employer's
contributions.
For purposes of this Section 1, a Member's contributions
shall be determined without regard to any rollover contributions
(as defined by Section 401(a)(5) of the Code).
(B) Annual additions to a Member's Account (including his
401(k) and Regular Accounts and his Profit Sharing Account) and
to any other defined contribution plan maintained by the Member's
Employer in respect of any Plan Year may not exceed the
limitations set forth in Section 415 of the Code, which are
incorporated by reference. For these purposes, "annual additions"
shall have the meaning set forth in Section 415(c)(2) of the
Code, as modified elsewhere in the Code and the Regulations, and
the limitation year shall mean the Plan Year unless any other
twelve-consecutive-month period is designated pursuant to a
written resolution adopted by the Employer and approved by the
Board. If a Member in the Plan also participates in any defined
benefit plan (as defined in Sections 414(j) and 415(k) of the
Code) maintained by the Employer or any of its Affiliates, in the
event that in any Plan Year the sum of the Member's "defined
benefit fraction" (as defined in Section 415(e)(2) of the Code)
and the Member's "defined contribution fraction" (as defined in
Section 415(e)(3) of the Code) exceeds 1.0, the benefit under
such defined benefit plan or plans shall be reduced in accordance
with the provisions of that plan or those plans, so that the sum
of such fractions in respect of the Member will not exceed 1.0.
If this reduction does not ensure that the limitation set forth
in this Paragraph (B) is not exceeded, then the annual addition
to any defined contribution plan, other than the Plan, shall be
reduced in accordance with the provisions of that plan but only
to the extent necessary to ensure that such limitation is not
exceeded.
(C) In the event that, due to forfeitures, reasonable error
in estimating a Member's compensation, or other limited facts and
circumstances, total contributions to a Member's Account are
found to exceed the limitations of thin Section, the Board shall
cause contributions made under Article III, Section 1 in excess
of such limitations to be refunded to the affected Member, with
earnings thereon, and shall take appropriate steps to reduce, if
necessary, the Employer contributions made with respect to those
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returned contributions. Such refunds shall not be deemed to be
withdrawals, loans, or distributions from the Plan. If a Member's
annual contributions exceed the limitations contained in
Paragraph (B) of this Section after the Member's Article III,
Section 1 contributions, with earnings thereon, if any, have been
refunded to such Member, the Profit Sharing contribution to be
allocated to any Member in respect of any Contribution
Determination Period (including allocations as provided in this
Paragraph) shall instead be allocated to or for the benefit of
all other Members who are Employees in Employment as of the last
day of the Contribution Determination Period as determined under
Article III, Section 8(C) and allocated in the same proportion
that each such Member's Salary for such Contribution
Determination Period bears to the total Salary for such
Contribution Determination Period of all such Members or, the
Board may, at the election of the Employer, utilize such excess
to reduce the contributions which would otherwise be made for the
succeeding Contribution Determination Period by the Employer. If,
with respect to any Contribution Determination Period, there is
an excess Profit Sharing contribution, and such excess cannot be
fully allocated in accordance with the preceding sentence because
of the limitations prescribed in Paragraph (B) of this Section,
the amount of such excess which cannot be so allocated shall be
allocated to the Employer Hold Account and made available to the
Employer pursuant to the terms of Article VI, Section 2(B)(2)
except that any such excess contribution may not be applied to
reduce administrative expenses (in accordance with Article IX,
Section 2). The Board, in accordance with Paragraph (D) of this
Section, shall take whatever additional action may be necessary
to assure that contributions to Members' Accounts meet the
requirements of this Section.
(D) In addition to the steps set forth in Paragraph (C)
above, the Board may from time to time adjust or modify the
maximum limitations applicable to contributions made in respect
of a Member under this Section 1 as may be required or permitted
by the Code or ERISA prior to or following the date that
allocation of any such contributions commence and shall take
appropriate action to real locate the annual contributions which
would otherwise have been made but for the application of this
Section.
(E) Membership in the Plan shall not give any Employee the
right to be retained in the Employment of his Employer and shall
not affect the right of the Employer to discharge any Employee.
(F) Each Member, Spouse and Beneficiary assumes all risk in
connection with any decrease in the market value of the assets of
the Trust Fund. Neither the Board nor the Trustee guarantees that
upon withdrawal the value of a Member's Account, his Profit
Sharing Account, and/or his Rollover Account will be equal to or
greater than the amount of the Member's own deferrals or
contributions, or those credited on his behalf in which the
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Member has a vested interest, under the Plan.
(G) The establishment, maintenance or crediting of a Member's
Account pursuant to the Plan shall not vest in such Member any
right, title or interest in the Trust Fund except at the times
and upon the terms and conditions and to the extent expressly set
forth in the Plan and the Trust Agreement.
(H) The Trust Fund shall be the sole source of payments under
the Plan and the Employer and the Board assume no liability or
responsibility for such payments, and each Member, Spouse or
Beneficiary who shall claim the right to any payment under the
Plan shall be entitled to look only to the Trust Fund for such
payment. All contributions to the Trust Fund shall be deemed to
have been made in the State of New York.
SECTION 2. TOP HEAVY PROVISIONS.
In respect of any Employer, the Plan will be considered a Top
Heavy Plan for any Plan Year if it is determined to be a Top
Heavy Plan as of the last day of the preceding Plan Year. The
provisions of this Section 2 shall apply and supersede all other
provisions in the Plan during each Plan Year with respect to
which the Plan, with regard to such Employer, is determined to be
a Top Heavy Plan.
(A) For purposes of this Section 2, the following terms shall
have the meanings set forth below:
(1) "AFFILIATE" shall mean any entity affiliated with
any Employer within the meaning of Section 414(b), 414(c) or
414(m) of the Code, or pursuant to the IRS Regulations under
Section 414(o) of the Code, except that for purposes of applying
the provisions hereof with respect to the limitation on
contributions, Section 415(h) of the Code shall apply.
(2) "AGGREGATION GROUP" shall mean the group composed of
each qualified retirement plan of the Employer or an Affiliate in
which a Key Employee is a member and each other qualified
retirement plan of the Employer or an Affiliate which enabler a
plan of the Employer or an Affiliate in which a Key Employee is a
member to satisfy Sections 401(a)(4) or 410 of the Code. In
addition, the Board may choose to treat any other qualified
retirement plan as a member of the Aggregation Group if such
Aggregation Group will continue to satisfy Sections 401(a)(4) and
410 of the Code with such plan being taken into account.
(3) "KEY EMPLOYEE" shall mean a "Key Employee" as
defined in Sections 416(i)(1) and (5) of the Code and the IRS
Regulations. For purposes of Section 416 of the Code and for
purposes of determining who is a Key Employee, an
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Employer which is not a corporation may have "officers" only for
Plan Years beginning after December 31, 1985. For purposes of
determining who is a Key Employee pursuant to this Subparagraph
(3), compensation shall have the meaning prescribed in Section
414(g) of the Code, or to the extent required by the Code or the
IRS Regulations, Section 1.415-2(d) of the IRS Regulations.
(4) "NON-KEY EMPLOYEE" shall mean a "Non-Key
Employee" as defined in Section 416(i)(2) of the Code and the IRS
Regulations thereunder.
(5) "TOP HEAVY PLAN" shall mean a "Top Heavy Plan" as
defined in Section 416(g) of the Code and the IRS Regulations
thereunder.
(6) "DETERMINATION DATE" shall mean the last day of
the preceding Plan Year or, in the case of the first Plan Year,
the last day of such Plan Year.
(7) "TOP HEAVY RATIO" is a fraction, the numerator of
which is the sum of the account balances of all Key Employees as
of the applicable Determination Date (including any part of any
account balance distributed in the five year period ending on the
Determination Date), and the denominator of which is the sum of
all account balances (including any part of any account balance
distributed in the five year period ending on the Determination
Date), both computed in accordance with Section 416 of the Code
and the IRS Regulations thereunder.
(B) Subject to the provisions of Paragraph (D) below, for
each Plan Year that the Plan is a Top Heavy Plan, the Employer's
contribution allocable to each Employee (other than a Key
Employee) who has satisfied the eligibility requirement(s) of
Article II, Section 2, and who is in service at the end of the
Plan Year shall not be less than the lesser of (i) 3% of such
eligible Employee's compensation (as defined in Section 414(s) of
the Code or to the extent required by the Code or the IRS
Regulations, Section 1.415-2(d) of the Regulations), provided
that for any Plan Year beginning on or after January 1, 1994 no
more than $150,000 (adjusted for cost of living to the extent
permitted by the Code and the IRS Regulations) shall be taken
into account), or (ii) the percentage at which Employer
contributions for such Plan Year are made and allocated on behalf
of the Key Employee for whom such percentage is the highest. For
the purpose of determining the appropriate percentage under
clause (ii), all defined contribution plans required to be
included in an Aggregation Group shall be treated as one plan.
Clause (ii) shall not apply if the Plan is required to be
included in an Aggregation Group which enables a defined benefit
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plan also required to be included in said Aggregation Group to
satisfy Sections 401(a)(4) or 410 of the Code. Contributions
attributable to salary reduction that are made to a Key
Employee's 401(k) Account shall be taken into account in
determining the minimum required contribution under this
Subsection (B).
(C) If the Plan is a Top Heavy Plan for any Plan Year, and
the Employer has elected vesting Schedule 3 under Article VI, the
vested interest of each Member, who is credited with at least one
Hour of Employment on or after the Plan becomes a Top Heavy Plan,
in the Units allocated to his Account and subject to vesting
Schedule 3 shall not be less than the percentage determined in
accordance with the following schedule:
Completed Vested
Years of Employment Percentage
------------------- ----------
Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 or more 100%
(D) (1) For each Plan Year that the Plan is a Top Heavy
Plan, 1.0 shall be substituted for 1.25 as the multiplicand of
the dollar limitation in determining the denominator of the
defined benefit plan fraction and of the defined contribution
plan fraction for purposes of Section 415(e) of the Code.
(2) If, after substituting "90%" for "60%" wherever the
latter appears in Section 416(g) of the Code, the Plan is not
determined to be a Top Heavy Plan, the provisions of Subparagraph
(1) of this Paragraph (D) shall not be applicable if the minimum
Employer contribution allocable to any Member who is a Non-Key
Employee as specified in Paragraph (B) of this Section is
determined by substituting "4%" for "3%."
(E) The Board shall, to the maximum extent permitted by the
Code and in accordance with the IRS Regulations, apply the
provisions of this Section 2 by taking into account the benefits
payable and the contributions made under the Financial
Institutions Retirement Fund or any other qualified plan
maintained by an Employer, to prevent inappropriate omissions or
required duplication of minimum contributions.
SECTION 3. INFORMATION AND COMMUNICATIONS.
Each Employer, Member, Spouse and Beneficiary shall be required
to furnish the Board with such information and data as may be
considered
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necessary by the Board. All notices, instructions and other
communications with respect to the Plan shall be in such form as
is prescribed from time to time by the Board, shall be mailed by
first class mail or delivered personally, and shall be deemed to
have been duly given and delivered only upon actual receipt
thereof by the Board. All information and data submitted by an
Employer or a Member, including a Member's birth date, marital
status, salary and circumstances of his employment and
termination thereof, may be accepted and relied upon by the
Board. All communications from the Board or the Trustee to an
Employer, Member, Spouse or Beneficiary shall be deemed to have
been duly given if mailed by first class mail to the address of
such person as last shown on the records of the Plan.
SECTION 4. SMALL ACCOUNT BALANCES.
Notwithstanding the foregoing provisions of the Plan, and except
as provided in Article III, Section 6(B)(6), if the value of all
of a Member's Account under the Plan (including a Profit Sharing
Account and a Rollover Account, if any), when aggregated is equal
to or exceeds $500, then no Account will be distributed without
the consent of the Member prior to age 65 (at the earliest).
SECTION 5. AMOUNTS PAYABLE TO INCOMPETENTS, MINORS OR ESTATES.
If the Board shall find that any person to whom any amount is
payable under the Plan is unable to care for his affairs because
of illness or accident, or is a minor, or has died, then any
payment due him or his estate (unless a prior claim therefor has
been made by a duly appointed legal representative) may be paid
to his Spouse, relative or any other person deemed by the Board
to be a proper recipient on behalf of such person otherwise
entitled to payment. Any such payment shall be a complete
discharge of the liability of the Trust Fund therefor.
SECTION 6. NON-ALIENATION OF AMOUNTS PAYABLE.
Except insofar as may otherwise be required by applicable law, or
Article VIII, or pursuant to the terms of a Qualified Domestic
Relations Order, no amount payable under the Plan shall be
subject in any manner to alienation by anticipation, sale,
transfer, assignment, bankruptcy, pledge, attachment, charge or
encumbrance of any kind, and any attempt to so alienate shall be
void; nor shall the Trust Fund in any manner be liable for or
subject to the debts or liabilities of any person entitled to any
such amount payable; and further, if for any reason any amount
payable under the Plan would not devolve upon such person
entitled thereto, then the Board, in its discretion, may
terminate his interest and hold or apply such amount for the
benefit of such person or his dependents as it may deem proper.
For the purposes of the Plan, a "Qualified Domestic Relations
Order" means any judgment, decree or order (including approval of
a property settlement agreement) which has been determined by the
Board in accordance with
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<PAGE>
procedures established under the Plan, to constitute a Qualified
Domestic Relations Order within the meaning of Section 414(p)(1)
of the Code. No amounts may be withdrawn under Article VII and
Article III, Section 8, and no loans granted under Article VIII,
if the Thrift Plan Office has received a document which may be
determined following its receipt to be a Qualified Domestic
Relations Order prior to completion of review of such order by
the Office within the time period prescribed for such review by
the IRS Regulations.
SECTION 7. UNCLAIMED AMOUNTS PAYABLE.
If the Board cannot ascertain the whereabouts of any person to
whom an amount is payable under the Plan, and if, after 5 years
from the date such payment is due, a notice of such payment due
is mailed to the address of such person, as last shown on the
records of the Plan, and within 3 months after such mailing such
person has not filed with the Board written claim therefor, the
Board may direct in accordance with ERISA that the payment
(including the amount allocable to the Member's contributions) be
cancelled, and used in abatement of the Plan's administrative
expenses, provided that appropriate provision is made for
recrediting the payment if such person subsequently makes a claim
therefor.
SECTION 8. LEAVES OF ABSENCE.
(A) Contribution allocations and vesting service continue to
the extent provided in Paragraphs (B)(1), (2), (3) or (4), below,
during any approved Leave of Absence, provided that the Employer
notifies the Plan of its intention to grant to a specific
Employee or Member, pursuant to the Employer's policy which is
uniformly applicable to all its Employees under similar
circumstances, one of the Leaves of Absence described in
Paragraph (B) below, and agrees to notify the Plan at the
conclusion of such leave.
(B) For purposes of the Plan there are only four types of
approved Leaves of Absence:
(1) Non-military leave granted to a Member for a
period not in excess of one year during which service is
recognized for vesting purposes and the Member is entitled to
share in any supplemental contributions under Article III,
Section 3 or forfeitures under Article VI, Section 2, if any, on
a pro-rata basis, determined by the Salary earned during the Plan
Year or Contribution Determination Period; or
(2) Non-military leave or layoff granted to a Member
for a period not in excess of one year during which service is
recognized for vesting purposes, but the Member is not entitled
to share in any contributions or forfeitures as defined under (1)
above, if any, during the period of the leave; or
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(3) To the extent not otherwise required by
applicable law, military or other governmental service leave
granted to a Member from which he returns directly to the service
of the Employer. Under this leave, a Member may not share in any
contributions or forfeitures as defined under (1) above, if any,
during the period of the leave, but vesting service will continue
to accrue; or
(4) To the extent not otherwise required by applicable
law, a military leave granted at the option of the Employer to a
Member who is subject to military service pursuant to an
involuntary call-up in the Reserves of the U.S. Armed Services
from which he returns to the service of the Employer within 90
days of his discharge from such military service. Under this
leave, a Member is entitled to share in any contributions or
forfeitures as defined under (1) above, if any, and vesting
service will continue to accrue. Notwithstanding any provision of
the Plan to the contrary, if a Member has one or more loans
outstanding at the time of this leave, repayments on such loan(s)
may be suspended, if the Member so elects, until such time as the
Member returns to the service of the Employer or the end of the
leave, if earlier.
SECTION 9. RETURN OF CONTRIBUTIONS TO EMPLOYER.
(A) In the case of a contribution that is made by an Employer
by reason of a mistake of fact, such Employer may request the
return to it of such contribution within one year after the
payment of the contribution, provided such refund is made within
one year after the payment of the contribution.
(B) In the case of a contribution made by an Employer or a
contribution otherwise deemed to be an Employer contribution
under the Code, such contribution shall be conditioned upon the
deductibility of the contribution by the Employer under Section
404 of the Code. To the extent the deduction for such
contribution is disallowed, in accordance with IRS Regulations,
the Employer may request the return to it of such contribution
within one year after the disallowance of the deduction.
SECTION 10. CONTROLLING LAW.
The Plan and all rights thereunder shall be governed by and
construed in accordance with the laws of the State of New York
and ERISA.
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<PAGE>
ARTICLE XI TERMINATION OF EMPLOYER
PARTICIPATION
SECTION 1. TERMINATION BY EMPLOYER.
Any Employer may terminate its participation in the Plan by
giving the Board written notice specifying a termination date
which shall be a Valuation Date at least 60 days subsequent to
the date such notice is received by the Board.
SECTION 2. TERMINATION BY BOARD.
The Board may terminate any Employer's participation, as of a
termination date specified by the Board, if the Board determines
that the Employer has failed to make proper contributions or to
comply with any other provision of the Plan or any applicable
rulings or Regulations under the Code, within 15 days after
notice and demand by the Board. Except as provided under Article
III, Section 3, upon complete discontinuance of an Employer's
contributions, its participation shall automatically terminate,
and its termination date shall be a Valuation Date specified by
the Board which is within 3 months subsequent to the last day
through which the Employer's contributions to the Trust Fund were
paid.
SECTION 3. TERMINATION DISTRIBUTION.
If an Employer's participation is terminated, the Board shall
promptly notify the IRS and such other appropriate governmental
authority as applicable law may require. Neither the Employer not
its Employees shall make any further contributions under the Plan
after the termination date, except that the Employer shall remit
to the Board an amount equal to the product of (i) $30 multiplied
by (ii) the number of the Employer's Members and Employees with a
balance in their Accounts as of the termination date, to defray
the cost of implementing its termination. If the Employer elects
to permit transfers to a qualified successor plan in accordance
with Article VII, Section 3, the Employer shall remit to the
Board an additional amount equal to the product of (i) $30
multiplied by (ii) the number of its Members and Employees with a
balance in their Accounts actually electing to transfer their
assets, to defray the cost of such transfer transaction. Except
as Article III, Section 4 may provide, each Employee may
thereafter withdraw the current value of his Accounts in
accordance with Article VII. Subject to the provisions of Article
XII, Paragraph (D), an Employer whose participation has been
terminated pursuant to this Article may transfer assets under its
prior Plan to a qualified successor plan, provided such plan
satisfies the requirements contained in Article VII, Section 3
and the transfer is otherwise in accordance with the procedures
of such Section.
With respect to the transfer of the amounts which are held in
Investment Funds A and C and which are attributable to the
terminating
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Employer, such transfer shall, subject to the provisions of
Article VII, Sections 1 and 3, be made in cash.
With respect to the transfer of the amounts which are held in
Investment Fund B and which are attributable to a terminating
Employer which has established a qualified successor plan, the
"Investment Fiduciary" (i.e., the Thrift Plan, or alternatively,
the Investment Manager of Fund B shall determine whether the
Employer shall be offered to have transferred to its successor
plan such amounts in the form of new investment contracts (the
"New Contracts") or, alternatively, whether the transfer from
Investment Fund B shall be made in cash.
If such amounts are determined to be offered in the form of New
Contracts by the Investment Fiduciary, the Investment Fiduciary
reserves the right to designate for acceptance by the Employer
one or more such New Contracts to be issued by one or more of the
issuers of the investment contracts then held under Investment
Fund B (the "Issuers"). If the Investment Fiduciary designates
more than one such New Contract, the Employer, in its acceptance
of the transfer of the New Contracts to its successor plan, must
accept all such New Contracts designated by the Investment
Fiduciary.
If all of the New Contracts designated by the Investment
Fiduciary are not accepted by the terminating Employer or,
alternatively, the Investment Fiduciary determines that the
transfer from Investment Fund B shall be made in cash and a cash
transfer is not accepted by the terminating Employer, funds
attributable to such Employer's participation under the Plan
shall continue to be maintained under the Issuers' contracts in
Investment Fund B under the Thrift Plan with no future right of
the Employer to request a transfer under the provisions of this
Section, provided that the Members who are Employees of such
Employer may obtain distributions of benefits from the Plan in
accordance with the provisions of Article VII, Sections 1 and 3.
If the New Contracts are accepted by the terminating Employer,
the Investment Fiduciary will, as of the transfer date specified
by the Thrift Plan, instruct the Issuers to allocate to such New
Contracts the asset values attributable to those Members electing
to transfer their Fund Account balances to the Employer's
qualified successor plan, thereby establishing such New Contracts
for the Employer. Such New Contracts may consist of terms
substantially similar to the terms then in effect of the
investment contracts held under Investment Fund B on the later of
the date of termination or the Valuation Date as of which the
transfer will occur, provided that the provisions of the
qualified successor plan are substantially similar to the
provisions of the Thrift Plan as determined by the Issuers.
Notwithstanding any other provision of this Section, the asset
values allocated to such New Contracts shall in no case exceed in
the aggregate an amount equal to the amount of all funds
attributable to
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such Employer, which are subject to such a transfer to a
qualified successor plan of the Employer in accordance with the
procedures of Article VII, Section 3(A), under all investment
contracts held under Investment Fund B under the Plan.
Upon the termination of participation under the Plan of an
Employee's or Member's any rights of the Employee or Member to
make contributions, rollovers or transfers to the Plan shall
cease.
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<PAGE>
ARTICLE XI I AMENDMENT OR TERMINATION OF THE PLAN AND TRUST
(A) The Board shall have the right to amend or terminate the
Plan or Trust Agreement at any time in whole or in part, for any
reason, and without the consent of any Employer, Member or
Beneficiary, and each Employer by its adoption of the Plan and
Trust shall be deemed to have delegated this authority to the
Board. No amendment, however, shall impair such rights of payment
as the Member or his Beneficiary would have had, if such
amendment had not been made, with respect to contributions made
by him or on his behalf prior to such amendment, except to the
extent that such amendment is, in the opinion of the Board,
necessary or desirable to qualify or maintain the Plan and the
Trust as a plan and trust meeting the requirements of Sections
401(a) and 501(a) of the Code as now in effect or hereafter
amended, or any other applicable section of the Code now or
hereafter in force from time to time; and no amendment shall make
it possible for any part of the Trust Fund (other than such part
as may be necessary to pay the expenses and charges referred to
in Article IX) to be used for purposes other than for the
exclusive benefit of Members or their Beneficiaries.
(B) In the event of termination of the Plan by the Board or
upon a complete discontinuance of contributions under the Plan,
the Units credited to each Member's Account as of the date of
such termination or complete discontinuance of contributions
shall be fully vested in the Member, and the Trustee shall upon
direction of the Board liquidate the assets of the Trust Fund
with such promptness as the Trustee deems prudent. When such
liquidation has been completed and after provision for all
expenses and charges referred to in Article IX, and proportionate
adjustment of all Plan Accounts to reflect such expenses, the
Trustee shall pay to each person who was a Member on such
termination date (or in the event of his death on or after such
date, to his Spouse or Beneficiary) a lump sum equal to the
amount, if any, then credited to his Account after such
liquidation and provision for expenses and charges.
(C) Notwithstanding any termination of the Plan by the Board,
the Board shall remain in existence and all the provisions of the
Plan shall remain in force which are necessary for the execution
of the Plan and the distribution of the Trust Fund assets in
accordance with this Article.
(D) No assets of the Plan shall in any event be merged,
consolidated with, or transferred to any other plan unless each
Member affected thereby would, if such plan then terminated
immediately after such event, receive thereunder a benefit which
is equal to or greater than the benefit to which he would have
been entitled if the Plan had terminated immediately before such
event.
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(E) In the event that any governmental authority or the Board
determines that a partial termination (within the meaning of
ERISA) of the Plan has occurred as to any Employer, then the
Units credited to the Account of each Member who is affected
thereby shall be fully vested in such Member and the provisions
of Article XI and this Article XII, which in the opinion of the
Board are necessary for the execution of the Plan and the
allocation and distribution of assets of the Plan, shall apply.
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<PAGE>
TRUSTS ESTABLISHED UNDER THE PLAN
Assets of the Plan are held in trust under Trust Agreements
with Bankers Trust Company, New York, NY, and Republic National
Bank of New York, N.A., pursuant to Article IX, Section 2 of the
Plan. Any Employer or Member may obtain a copy of these Trust
Agreements from the office of the Plan.
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<PAGE>
APPENDIX A
The Plan, as set forth herein, constitutes a restatement of
the Plan with amendments effective through July 1, 1993. Although
this restatement is generally effective July 1, 1993, the
inclusion of amendments to conform with the Tax Reform Act of
1986 and other applicable laws necessitates different effective
dates for certain provisions of the Plan. Accordingly,
notwithstanding the general effective date of this restatement,
various provisions shall be effective as expressly provided under
the Plan and the following sections, as amended, shall be
effective as indicated below:
Sections Effective
-------- ---------
Art. X, Section 2 (A) (1) July 18, 1984
Art. VII, Section 5(B) January 1, 1985
Art. I, Paragraph 14; Art. X January 1, 1987
Sections 1, 2(A)(4) & (5)
Art. I, Paragraphs 4, 9, 24, & 32; January 1, 1988
Art. II, Section 2; Art. III,
Section 1, Section 2(A) (the first
sentence), Section 3; Art. IV
(fifth paragraph); Art. V (the first
paragraph); Art. VI; Art. VII,
Sections 2, 3(A) and 5; Art. VIII,
Section 1 (after the proviso);
Art. X, Sections 2(C), 4, 8,
9 and 10.
Art. I, Paragraph 10 July 1, 1988
Art. VIII, Sections 2 through 7 October 18, 1989
(except clause (a) of the second
sentence of Section 3 which shall
be effective January 1, 1989)
Art. III, Section 3 January 1, 1990
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<PAGE>
ADOPTION AGREEMENT
- ----------------------------------------------------------------
For Home Savings Bank, SSB
Employees' Savings & Profit Sharing Plan and Trust
Pentegra
<PAGE>
<PAGE>
Home Savings Bank, SSB: Home Savings Bank, SSB
---------------------------
Address: 1311 Carolina Avenue, Washington NC 27889
-----------------------------------------
Phone No.: (919) 946-4178
--------------
Contact Person: Thomas A. Vann, President
-------------------------
Name of Plan: Home Savings Bank, SSB Employees' Savings
& Profit Sharing Plan and Trust
-----------------------------------------
- -
THIS ADOPTION AGREEMENT, upon execution by the Employer and the
Trustee, and subsequent approval by a duly authorized
representative of Pentegra Services, Inc. (the "Sponsor"),
together with the Sponsor's Employees' Savings & Profit Sharing
Plan and Trust Agreement (the "Agreements), shall constitute the
[Home Savings Bank, SSB] Employees' Savings & Profit Sharing Plan
and Trust (the "Plan"). The terms and provisions of the Agreement
are hereby incorporated herein by this reference; provided,
however, that if there is any conflict between the Adoption
Agreement and the Agreement, this Adoption Agreement shall
control.
The elections hereinafter made by the Employer in this Adoption
Agreement may be changed by the Employer from time to time by
written instrument executed by a duly authorized representative
thereof; but if any other provision hereof or any provision of
the Agreement is changed by the Employer other than to satisfy
the requirements of Section 415 or 416 of the Internal Revenue
Code of 1986, as amended (the "Code"), because of the required
aggregation of multiple plans, or if as a result of any change by
the Employer the Plan fails to obtain or retain its tax-qualified
status under Section 401(a) of the Code, the Employer shall be
deemed to have amended the Plan evidenced hereby and by the
Agreement into an individually designed plan, in which event the
Sponsor shall thereafter have no further responsibility for the
tax-qualified status of the Plan. However, the Sponsor may amend
any term, provision or definition of this Adoption Agreement or
the Agreement in such manner as the Sponsor may deem necessary or
advisable from time to time and the Employer and the Trustee, by
execution hereof, acknowledge and consent thereto.
Notwithstanding the foregoing, no amendment of this Adoption
Agreement or of the Agreement shall increase the duties or
responsibilities of the Trustee without the written consent
thereof.<PAGE>
<PAGE>
I. EFFECT OF EXECUTION OF ADOPTION AGREEMENT
The Employer, upon execution of this Adoption Agreement by a
duly authorized representative thereof, (choose 1 or 2):
1. _______ Establishes as a new plan the [Home Bank, SSB)
Employees' Savings & Profit Sharing Plan and
Trust, effective ________________, 19__.
2. ___X___ Amends its existing defined contribution plan
and trust (Financial Institutions Thrift Plan)
dated July 1, 1995, in its entirety into the
[Home Savings Bank, SSB] Employees' Savings &
Profit Sharing Plan and Trust, effective March
1, 1997, except as otherwise provided herein or
in the Agreement.
II. DEFINITIONS
A. "Contribution Determination Period" for purposes of
determining and allocating Employer profit sharing
contributions means (choose 1, 2, 3 or 4):
1. ________ The Plan Year.
2. ________ The Employer's Fiscal Year (defined as the
Plan's "limitation year") being the twelve
(12) consecutive month period commencing
_________________ (month/day) and ending
_________________ (month/day).
3. ________ The three (3) consecutive monthly periods
that comprise each of the Plan Year
quarters.
4. ________ The three (3) consecutive monthly periods
that comprise each of the Employer's
Fiscal Year quarters. (Employer's Fiscal
Year is the twelve (12) consecutive month
period commencing (month/day) and ending
(month/day)
B. "Effective Date" means March 1, 1997.
------- -
C. Employer
1. "Employer," for purposes of the Plan, shall mean:
Home Savings Bank, SSB.
----------------------
2. The Employer is (choose whichever may apply):
(a) _______ A member of a controlled group of
corporations under Section 414(b) of
the Code.
(b) _______ A member of a group of entities under
common control under Section 414(c)
of the Code.
(c) _______ A member of an affiliated service
group under Section 414(m) of the
Code.
(d) __X____ A corporation.
(e) _______ A sole proprietorship or partnership.
(f) _______ A Subchapter S corporation.
<PAGE>
<PAGE>
3. Employer's Taxable Year Ends on 12/31.
-----
4. Employer's Federal Taxpayer Identification
Number is 56 0266599.
----------
5. Employer's Plan Number is (enter 3 digit number)
D. "Entry Date" means the first day of the (choose 1 or
2):
1. ________ Calendar month coinciding with or next
following the date the Employee satisfies
the Eligibility requirements described in
Section III.
2. ________ Calendar quarter coinciding with or next
following the date the Employee satisfies
the Eligibility requirements described in
Section III.
E. "Member" means an Employee enrolled in the membership
of the Plan.
F. "Normal Retirement Age" means (choose 1 or 2):
1. ___X____ Attainment of age 65 (select an age not
less than 55 and not greater than 65).
2. ________ Later of: (i) attainment of age 65 or (ii)
the fifth anniversary of the date the
Member commenced participation in the
Plan.
G. "Normal Retirement Date" means the first day of the
first calendar month coincident with or next following the date
upon which a Member attains his or her Normal Retirement Age.
H. "Plan Year" means the twelve (12) consecutive month
period beginning on each January 1.
I. "Salary" for benefit purposes under the Plan means
(choose 1, 2 or 3):
1. ________ Basic Salary only.
2. ________ Basic Salary plus one or more of the
following (if 2 is chosen, then choose (a),
(b) or (c), whichever shall apply):
(a) ____ Commissions not in excess of
$_____________.
(b) ____ Overtime
(c) ____ Overtime and bonuses
3. ____X___ Total taxable compensation as reported on
Form W-2 (exclusive of any compensation
deferred from a prior year).
Note: Member pre-tax elective deferrals, if any, are
always included in Plan Salary.
J. "Salary" shall not include:
_______ Member pre-tax contributions to a Code
Section 125 cafeteria plan.
<PAGE>
<PAGE>
III. ELIGIBILITY REQUIREMENTS
A. Employees shall be eligible to participate in the Plan in
accordance with the provisions of Article II of the Plan, except
the following Employees shall be excluded (choose whichever shall
apply):
1. ____X____ Employees who have not attained age 21.
2. ____X____ Employees who have not, during the 12
consecutive month period (1-11, 12 or
24) beginning with an Employee's Date of
Employment,Date of Reemployment or any
anniversary thereof, completed 1000
number of Hours of Service (determined
by multiplying the number of months
above by 83 1/3).
Note: Employers which permit Members to make
pre-tax elective deferrals to the Plan
(see V.A.3.) may not elect a 24 month
eligibility period.
3. __________ Employees included in a unit of Employees
covered by a collective bargaining
agreement, if retirement benefits were
the subject of good faith bargaining
between the Employer and Employee
representatives.
4. __________ Employees who are nonresident aliens and
who receive no earned income from the
Employer which constitutes income from
sources within the United States.
5. ____X______ Employees included in the following job
classifications:
(a) __X___ Hourly Employees
(b) ______ Salaried Employees
6. __________ Employees of the following employers
which are aggregated under Section
414(b), 414(c) or 414(m) of the Code:
Note: If no entries are made above, all Employees
shall be eligible to participate in the Plan on the later of: (i)
the Effective Date or (ii) the first day of the calendar month or
calendar quarter (as designated by the Employer in Section
II.D.).) coinciding with or immediately following the Employee's
Date of Employment or, as applicable, Date of Reemployment.
B. Such Eligibility Computation Period established above
shall be applicable to (choose 1 or 2):
1. ___X___ Both present and future Employees.
2. _______ Future Employees only.
<PAGE>
<PAGE>
C. Such Eligibility requirements established above shall
be (choose 1 or 2):
1. ___X___ Applied to the designated Employee group
on and after the Effective Date of the
Plan.
2. _______ Waived for the _______ consecutive monthly
period (may not exceed 12) beginning on the
Effective Date of the Plan.
IV. HOURS OF EMPLOYMENT AND PRIOR EMPLOYMENT CREDIT
A. The number of Hours of Employment with which an
Employee or Member is credited shall be (choose 1 or 2):
1. ________ The actual number of Hours of Employment.
(Hour of Service Method)
2. ___x____ 83 1/3 Hours of Employment for every month of
Employment. (Elapsed Time Method)
B. Prior Employment Credit:
_______ Employment with the following entity or
entities shall be included for eligibility
and vesting purposes:
Note: If this Plan is a continuation of a
Predecessor Plan, service under the
Predecessor Plan shall be counted as
Employment under this Plan.
________________________________________________
________________________________________________
________________________________________________
V. CONTRIBUTIONS
Note: Annual Member pre-tax elective deferrals, Employer
matching contributions, Employer basic contributions,
Employer supplemental contributions, Employer profit
sharing contributions and Employer Qualified Non-Elective
contributions, in the aggregate, may not exceed 15% of all
Members' Salary (excluding from Salary Member pre-tax
elective deferrals).
A. Employee Contributions (choose 1 or 2; 3 or 4; 5 and/or 6):
1. _______ A Member may make after-tax contributions
to the Plan, based on multiples of 1% of
monthly Salary.
2. ___X___ A Member may not make after-tax
contributions to the Plan.
3. ___X___ A Member may make pre tax elective
deferrals to the Plan, based on multiples
of 1% of monthly Salary.
4. _______ A Member may not make pre-tax elective
deferrals to the Plan.
5. ___X___ The maximum amount of monthly
contributions a Member may make to the
Plan is 15.0% (1-20) of the Member's
monthly Salary.
6. ___X___ An Employee may allocate a rollover
contribution to the Plan prior to
satisfying the Eligibility requirements
described above.
<PAGE>
<PAGE>
B. A Member may change his or her contribution rate (choose
1 or 2):
1. ___X___ 1 time per calendar month.
2. _______ 1 time per calendar quarter.
C. Employer Matching Contributions (choose 1, 2, 3 or 4;
and fill in 5 if applicable):
1. _______ No Employer matching contributions will be
made to the Plan.
2. ___X___ The Employer shall allocate to each
contributing Member's Account an amount
equal to 50% (based on 5% increments not
to exceed 200%) of the Member's
contributions for that month.
3. ________ The Employer shall allocate to each
contributing Member's Account an amount
determined in accordance with the
following schedule:
Years of Employment Matching%
------------------- ---------
Less than 3 50%
At least 3, but less than 5 75%
5 or more 100%
4. _______ The Employer shall allocate to each
contributing Member's Account an amount
determined in accordance with the
following schedule:
Years of Employment Matching%
------------------- ---------
Less than 3 100%
At least 3, but less than 5 150%
5 or more 200%
5. The Employer matching contributions under 2, 3 or 4
above shall be based on the Member's contributions
not in excess of 6% (1-20 but not in excess of the
percentage specified in A.5. above) of the Member's
Salary.
D. Employer Basic Contributions (choose 1 or 2):
1. ___X___ No Employer basic contributions will be made
to the Plan.
2. _______ The Employer shall allocate an amount equal
to ____% (based on 1% increments not to
exceed 15%) of Member's Salary for the month
to (choose (a) or (b)):
(a) _________ The Accounts of all Members
(b) _________ The Accounts of all Members who
were employed with the Employer
on the last day of such month.
<PAGE>
<PAGE>
E. Employer Supplemental Contributions:
The Employer may make supplemental contributions for
any Plan Year in accordance with Section 3.7 of the Plan.
F. Employer Profit Sharing Contributions (Choose 1, 2,
3, 4, or 5):
1. ___X___ No Employer Profit Sharing Contributions
will be made to the Plan.
Non-Integrated Formula
----------------------
2. _______ Profit sharing contributions shall be
allocated to each Member in the same ratio
as each Member's Salary during such
Contribution Determination Period bears to
the total of such Salary of all Members.
3. _______ Profit sharing contributions shall be
allocated to each Member in the same ratio
as each Member's Salary for the portion of
the Contribution Determination Period
during which the Member satisfied the
Employer's eligibility requirement(s)
bears to the total of such Salary of all
Members.
Integrated Formula
------------------
4. _______ Profit sharing contributions shall be
allocated to each Member's Account in a
uniform percentage (specified by the
Employer as %) of each Member's Salary
during the Contribution Determination
Period up to the Social Security Taxable
Wage Base as defined in Section ___ of the
Plan ["Base Salary") for the Plan Year that
includes such Contribution Determination
Period, plus a uniform percentage(specified
by the Employer as ___%) of each Member's
Salary for the Contribution Determination
Period in excess of the Social Security
Taxable Wage Base ("Excess Salary") for the
Plan Year that includes such Contribution
Determination Period, in accordance with
Article III of the Plan.
5. _______ Profit sharing contributions shall be
allocated to each Member's Account in a
uniform percentage (specified by the
Employer as ___%) of each Member's Salary
for
the portion of the Contribution
Determination Period during which the
Member satisfied the Employer's eligibility
requirement(s), if any, up to the Base
Salary for the Plan Year that includes such
Contribution Determination Period, plus a
uniform percentage (specified by the
Employer as ___%) of each Member's Excess
Salary for the portion of the Contribution
Determination Period during which the
Member satisfied the Employer's eligibility
requirement(s) in accordance with Article
III of the Plan.
G. Allocation of Employer Profit Sharing Contributions:
In accordance with Section V, G above, a Member shall
be eligible to share in Employer Profit Sharing Contributions, if
any, as follows (choose 1 or 2):
1. ________ A Member shall be eligible for an
allocation of Employer Profit Sharing
Contributions for a Contribution
Determination Period in all events.
<PAGE>
<PAGE>
2. ________ A Member shall be eligible for an
allocation of Employer Profit Sharing
Contributions for a Contribution
Determination Period only if he or she
(choose (a), (b) or (c) whichever shall
apply):
(a) _______ is employed on the last day of
the Contribution Determination
Period or retired, died or
became totally and permanently
disabled prior to the last day
of the Contribution Determina-
tion Period.
(b) _______ completed 1,000 Hours of
Employment if the Contribution
Determination Period is a period
of 12 months (250 Hours of
Employment if the Contribution
Determination Period is a period
of 3 months) or retired, died or
became totally and permanently
disabled prior to the last day
of the Contribution Determina-
tion Period.
(c) _______ is employed on the last day of
the Contribution Determination
Period and, if such period is 12
months, completed 1,000 Hours of
Employment (250 Hours of
Employment if the Contribution
Determination Period is a period
of 3 months) or retired, died or
became totally and permanently
disabled prior to the last day
of the Contribution
Determination Period.
H. Employer Qualified Nonelective Contributions:
The Employer may make qualified nonelective
contributions for any Plan Year in accordance with Section 3.9 of
the Plan.
VI. INVESTMENT FUNDS
The Employer hereby selects the following Investment Funds to be
made available under the Plan (choose whichever shall apply). The
Employer agrees and acknowledges that the selection of Investment
Funds made in this Section VI is solely its responsibility, and
no other person, including the Sponsor, has any discretionary
authority or control with respect to such selection process.
1. ___X___ 500 Stock Index Fund
2. ___X___ Stable Value Fund
3. ___X___ MidCap 400 Stock Index Fund
4. ___X___ Government Money Market Fund
5. ___X___ Bond Index Fund
6. ___X___ Home Savings Bank Stock Fund
<PAGE>
<PAGE>
VII. EMPLOYER SECURITIES
A. If the Employer makes available an Employer Stock
Fund pursuant to Section VI of this Adoption Agreement, then
voting and tender offer rights with respect to Employer Stock
shall be delegated and exercised as follows (choose 1 or 2):
1. _______ The Plan Administrator shall direct the
Trustee as to the voting of all Employer
Stock and as to all rights in the event of
a tender offer involving such Employer
Stock.
2. ___X___ Each Member shall be entitled to direct the
Plan Administrator as to the voting and
tender offer rights involving Employer
Stock held in such Member's Account, and
the Plan Administrator shall follow or
cause the Trustee to follow such
directions. If a Member fails to provide
the Plan Administrator with directions as
to voting or tender offer rights, the Plan
Administrator shall exercise those rights
as it determines in its discretion and
shall direct the Trustee accordingly.
VIII. INVESTMENT DIRECTION
A. Members shall be entitled to designate what
percentage of employee contributions and employer contributions
made on their behalf will be invested in the various Investment
Funds offered by the Employer as specified in Section VI of this
Adoption Agreement; provided, however, that the following
portions of a Member's Account must be invested in the Employer
Stock Fund (choose whichever shall apply):
1. _______ Employer Profit Sharing Contributions
2. _______ Employer Matching Contributions
3. _______ Employer Basic Contributions
4. _______ Employer Supplemental Contributions
5. _______ Employer Qualified Nonelective
Contributions
B. A Member may change his or her investment direction
(choose 1 or 2):
1. ___X___ 1 time per calendar month.
2. _______ 1 time per calendar quarter.
C. If a Member fails to make an effective investment
direction, the Member's contributions and Employer contributions
made on the Member's behalf shall be invested in U.S. Government
Money Market Fund (insert one of the Investment Funds selected in
Section VI of this Adoption Agreement).
<PAGE>
<PAGE>
IX. VESTING SCHEDULES; YEARS OF EMPLOYMENT FOR VESTING
PURPOSES
A. (Choose 1, 2, 3, 4, 5, 6, or 7)
<TABLE>
<CAPTION>
Schedule Years of Employment Vested%
- -------- ------------------- ------
<S> <C> <C>
1. _____ Immediate Upon Enrollment 100%
2. _____ 2-6 Year Graded Less than 2 0%
2 but less than 3 20%
3 but less than 4 40%
4 but less than 5 60%
5 but less than 6 80%
6 or more 100%
3. _____ 5-Year Cliff Less than 5 0%
5 or more 100%
4. _____ 3-Year Cliff Less than 3 0%
3 or more 100%
5. __X__ 4-Year Graded Less than 1 0%
1 but less than 2 25%
2 but less than 3 50%
3 but less than 4 75%
4 or more 100%
Schedule Years of Employment Vested
- -------- ------------------- ------
6. _____ 3-7 Year Graded Less than 3 0%
3 but less than 4 20%
4 but less than 5 40%
5 but less than 6 60%
6 but less than 7 80%
7 or more 100%
7. _____ Other Less than ___ 0%
__ but less than __ ___%
__ but less than __ ___%
__ but less than __ ___%
__ but less than __ ___%
__ or more 100%
B. With respect to the schedules listed above, the
Employer elects (choose 1, 2, 3 and 4, or 5):
1. Schedule __5__ solely with respect to Employer
matching contributions.
2. Schedule _____ solely with respect to Employer
basic contributions.
3. Schedule _____ solely with respect to Employer
supplemental contributions.
<PAGE>
<PAGE>
4. Schedule _____ solely with respect to Employer
profit sharing contributions.
5. Schedule _____ with respect to all Employer
contributions.
NOTE: Notwithstanding any election by the Employer to
the contrary, each Member shall acquire a 100% vested interest in
his Account attributable to all Employer contributions made to
the Plan upon the earlier of (i) attainment of Normal Retirement
Age, (ii) approval for disability or (iii) death. In addition, a
Member shall at all times have a 100% vested interest in the
Employer Qualified Non Elective Contributions, if any, and in the
pre-tax elective deferrals and nondeductible after-tax Member
Contributions.
C. Years of Employment Excluded for Vesting Purposes
The following Years of Employment shall be disregarded
for vesting purposes (choose whichever shall apply):
1. _____ Years of Employment during any period in
which neither the Plan nor any predecessor
plan was maintained by the Employer.
2. _____ Years of Employment of a Member prior to
attaining age 18.
X. WITHDRAWAL PROVISIONS
A. The following portions of a Member's Account will be
eligible for in-service withdrawals, subject to the provisions of
Article VII of the Plan (choose whichever shall apply):
1. _____ Employee after-tax contributions and the
earnings thereon.
2. _____ Employee pre-tax elective deferrals and the
earnings thereon.
3. _____ Employee rollover contributions and the
earnings thereon.
4. _____ Employer matching contributions and the
earnings thereon.
5. _____ Employer basic contributions and the earnings
thereon.
6. _____ Employer supplemental contributions and the
earnings thereon.
7. _____ Employer profit sharing contributions and the
earnings thereon.
8. _____ Employer qualified nonelective contributions
and earnings thereon.
9. __X__ In service withdrawals permitted only in the
event of (choose (a) and/or (b)):
(a) __x__ Hardship.
(b) __x__ Attainment of age 59 1/2.
10._____ No in-service withdrawals shall be allowed.
<PAGE>
<PAGE>
B. Notwithstanding any elections made in Subsection A of
this Section X above, the following portions of a Member's
Account shall be excluded from eligibility for in-service
withdrawals (choose whichever shall apply):
1. _____ Employer contributions, and the earnings
thereon, credited to the Employer Stock Fund.
2. _____ All contributions and/or deferrals, and the
earnings thereon, credited to the Employer
Stock Fund.
3. _____ Other: ____________________
XI. DISTRIBUTION OPTION (choose 1 or 2)
1. _____ Lump Sum and partial lump sum payments only.
2. __X__ Lump Sum and partial lump sum payments plus one or
more of the following (choose (a) and/or (b)):
(a) __X__ Installment payments.
(b) _____ Annuity payments.
XII. LOAN PROGRAM (CHOOSE 1, 2 or 3)
1. _____ No loans will be permitted from the Plan.
2. __X__ Loans will be permitted from the Member's Account.
3. _____ Loans will be permitted from the Member's Account,
excluding (choose whichever shall apply):
(a) _____ Employer Profit sharing contributions
and the earnings thereon.
(b) _____ Employer matching contributions and the
earnings thereon.
(c) _____ Employer basic contributions and the
earnings thereon.
(d) _____ Employer supplemental contributions and
the earnings thereon.
(e) _____ Employee after-tax contributions and
the earnings thereon.
(f) _____ Employee pre-tax elective deferrals and
the earnings thereon.
(g) _____ Employee rollover contributions and the
earnings thereon.
(h) _____ Employer qualified nonelective
contributions and the earnings thereon.
(i) _____ Any amounts to the extent invested in
the Employer stock fund.
<PAGE>
<PAGE>
XIII. ADDITIONAL INFORMATION
If additional space is needed to select or describe an
elective feature of the Plan, the Employer should attach
additional pages and use the following format:
The following is hereby made a part of Section - of the
Adoption Agreement and is thus incorporated into and made a part
of the [Plan Name]
Signature of Employer's Authorized Representative
/s/ Thomas A. Vann
-------------------
Signature of Trustee /s/ Thomas A. Vann
------------------
Supplementary Page -- of [total number of pages].
XIV. PLAN ADMINISTRATOR
The Named Plan Administrator under the Plan shall be the
(choose 1, 2, 3 or 4):
Note: Pentegra Services, Inc. may not be appointed Plan
Administrator.
1. __X__ Employer
2. _____ Employer's Board of Directors
3. _____ Plan's Administrative Committee
4. _____ Other (if chosen, then provide the following
information)
Name: ____________________________________
Address: __________________________________
Tel No. ___________________________________
Contact:___________________________________
Note: If no Named Plan Administrator is
designated above, the Employer shall be deemed the Named Plan
Administrator.
XV. TRUSTEE
The Employer hereby appoints the following person or entity
to serve as Trustee under the Plan:
Name: THOMAS A. VANN IN CARE OF HOME SAVINGS BANK, SSB
-------------------------------------------------
Address: PO BOX 2047, 1311 CAROLINA AVENUE, WASHINGTON, NC 27889
------------------------------------------------------
Tel No: (919) 946-4178
------------------------------------------------------
Contact: THOMAS A. VANN OR JANET WOOLARD
------------------------------------------------------
<PAGE>
<PAGE>
EXECUTION OF ADOPTION
AGREEMENT
By execution of this Adoption Agreement by a duly authorized
representative of the Employer, the Employer acknowledges that it
has established or, as the case may be, amended a tax-qualified
retirement plan into the (Home Savings Bank, SSB) Employees'
Savings & Profit Sharing Plan and Trust (the "Plan"). The
Employer hereby represents and agrees that it will assume full
fiduciary responsibility for the operation of the Plan and for
complying with all duties and requirements imposed under
applicable law, including, but not limited to, the Employee
Retirement Income Security Act of 1974, as amended, and the
Internal Revenue Code of 1986, as amended. In addition, the
Employer represents and agrees that it will accept full
responsibility of complying with any applicable requirements of
federal or state securities law as such laws may apply to the
Plan and to any investments thereunder. The Employer further
acknowledges that any opinion letter issued with respect to the
Adoption Agreement and the Agreement by the Internal Revenue
Service ("IRS") to Pentegra Services, Inc., as sponsor of the
Employees' Savings & Profit Sharing Plan, does not constitute a
ruling or a determination with respect to the tax qualified
status of the Plan and that the appropriate application must be
submitted to the IRS in order to obtain such a ruling or
determination with respect to the Plan.
THE FAILURE TO PROPERLY COMPLETE THE ADOPTION AGREEMENT MAY
RESULT IN DISQUALIFICATION OF THE PLAN AND TRUST EVIDENCED
THEREBY.
The Sponsor will inform the Employer of any amendments to the
Plan or Trust Agreement or of the discontinuance or abandonment
of the Plan or Trust.
Any inquiries regarding the adoption of the Plan should be
directed to the Sponsor as follows:
Pentegra Services, Inc.
108 Corporate Park Drive
White Plains, New York 10604
(914) 694-1300
IN WITNESS WHEREOF, the Employer has caused this Adoption
Agreement to be executed by its duly authorized officer this 11th
day of February, 1997.
Home Savings Bank, SSB
By: /s/ Thomas A. Vann
----------------------------
Name: THOMAS A. VANN
----------------------------
Title: PRESIDENT
----------------------------
</TABLE>
Financial Institutions Thrift Plan
As Adopted by
HOME SAVINGS BANK, SSB
SUMMARY PLAN DESCRIPTION
108 CORPORATE PARK DRIVE - WHITE PLAINS, NY 10604
<PAGE>
<PAGE>
SUMMARY PLAN DESCRIPTION
HOME SAVINGS BANK, SSB
Washington, North Carolina
July 1, 1996
FINANCIAL INSTITUTIONS THRIFT PLAN
108 Corporate Park Drive
White Plains, NY 10604
<PAGE>
<PAGE>
TO OUR MEMBERS:
We are pleased to present this booklet so that you may better
understand and appreciate the savings plan which is provided by
your employer through its participation in the Financial
Institutions Thrift Plan (the "Plan").
The Plan is a tax-exempt, trusteed savings plan which was created
in 1970. It is administered by a professional staff under the
direction of a Board of Directors (the "Board") comprised of
persons who are officers of Federal Home Loan Banks or
participating financial institutions and the President of the
Plan.
The Plan enables financial institutions to make it possible for
their employees to save and invest on a regular, long term basis.
All contributions to the Plan (a defined contribution type plan)
are paid to the Trustee to be invested for the benefit of all
members. An individual account is maintained for each member.
Under certain conditions, a member may make withdrawals from his
account based on its market value.
The Plan offers federal income tax advantages. The employee does
not pay taxes on employer contributions or investment income
until he withdraws them. An employer subject to income tax may
deduct its contributions.
This booklet highlights the main features of the Plan. The Plan
and Declaration of Trust contain the governing provisions and
should be consulted as official text in all cases.
Board of Directors,
Financial Institutions Thrift Plan
<PAGE>
<PAGE>
TABLE OF CONTENTS
Page
Employee Eligibility . . . . . . . . . . . . . . . . . . . 2
Plan Contributions . . . . . . . . . . . . . . . . . . . . 3
Allocation of Contributions. . . . . . . . . . . . . . . . 3
Plan Salary . . . . . . . . . . . . . . . . . . . . . . . 4
Investment of Contributions. . . . . . . . . . . . . . . . 5
Valuation of Accounts. . . . . . . . . . . . . . . . . . . 7
Reporting to Members . . . . . . . . . . . . . . . . . . . 7
Vesting . . . . . . . . . . . . . . . . . . . . . . . . . 8
Account Withdrawal . . . . . . . . . . . . . . . . . . . . 9
-- While Employed . . . . . . . . . . . . . . . . . . 9
-- Upon Termination of Employment . . . . . . . . . . 10
-- Upon Disability. . . . . . . . . . . . . . . . . . 11
-- Upon Death . . . . . . . . . . . . . . . . . . . . 11
Reenrollment . . . . . . . . . . . . . . . . . . . . . . . 11
Rollovers. . . . . . . . . . . . . . . . . . . . . . . . . 11
Loans. . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Negative Cash Flow Provision . . . . . . . . . . . . . . . 13
Plan Limitations . . . . . . . . . . . . . . . . . . . . . 14
Top Heavy Information. . . . . . . . . . . . . . . . . . . 15
Disputed Claims Procedure. . . . . . . . . . . . . . . . . 15
Statement of Member's Rights . . . . . . . . . . . . . . . 16
Other Plan Information . . . . . . . . . . . . . . . . . . 17
<PAGE>
<PAGE>
EMPLOYEE ELIGIBILITY
Each employee shall be enrolled as a member when eligible. You
will be eligible for membership in the Plan on the first day of
the month after you complete 1 year of employment and attain age
21.
In order for you to complete 1 year of employment, you must
complete at least 1,000 hours of employment in a 12 consecutive
month period. The initial 12 consecutive month period is measured
from your date of employment, and (if you do not complete at
least 1,000 hours of employment in such period) subsequent 12
month periods are measured on a calendar year basis from the
January 1 immediately following your date of employment.
In counting hours you will be credited with an hour of employment
for every hour you have a right to be paid. This includes vacation,
sick leave, jury duty, etc., and any hours for which back pay may
be due.
You will become a member as soon as a properly executed enrollment
application is received by the Board. Your membership will continue
until the earlier of (a) your termination of employment and payment
to you of your entire account or (b) your death.
NOTE: Your employer will notify you of your right to become a
member when you are eligible and will furnish you with an
enrollment application. If, for any reason, you are not so
notified, you will be retroactively enrolled as of the date
you first became eligible. In this event, both you and your
employer will be required to make the contributions (without
plan earnings thereon) each would have made had you been
enrolled on such earlier date, and your account will then
consist solely of the units credited to you as a result of
these contributions.
Establishment of Rollover Accounts
- ----------------------------------
Notwithstanding the above, any employee may establish a "rollover"
account within the Plan, regardless of whether the employee has
satisfied the employer's eligibility requirement(s). However, the
existence of a "rollover" account will not constitute active
membership in the Plan, such participation being available only
after satisfaction of the employer's eligibility requirement(s)
described above.
2
<PAGE>
<PAGE>
PLAN CONTRIBUTIONS
Employee - You may elect to make a monthly contribution of 1%,
2%, 3%, 4%, 5%, 6%, 7%, 8%, 9%, 10%, 11%, 12%, 13%, 14% or 15% of
monthly Plan Salary (see "Plan Salary" section of this booklet).
You may elect not to make any contributions. You may change the
rate at which you are contributing as of the first day of any
month. You may suspend your contributions at any time, but
suspended contributions may not be subsequently made up.
Employer - Your employer will contribute on a monthly basis an
amount equal to 50% of your monthly contribution.
The above percentage rate shall apply to only the first 6% of your
monthly Plan Salary (see "Plan Salary" section of this booklet).
ILLUSTRATION
Employee Employer's 50%
Contribution Rate Matching Contribution
----------------- ---------------------
2% 1.0%
3% 1.5%
4% 2.0%
5% 2.5%
6-15% 3.0%
Please refer to the "Account Withdrawal" section of this booklet to
determine if there are any restrictions on employer contributions
on account of a withdrawal.
ALLOCATION OF CONTRIBUTIONS
Your employer has established a Regular account and a 401(k)
account for each member. The total of the value of your Regular and
401 (k) accounts represents your interest in the Thrift Plan.
Employee
- --------
All of your contributions will be allocated to your 401 (k)
account.
Employer
- --------
All employer contributions will be allocated to your Regular
account.
3
<PAGE>
<PAGE>
Internal Revenue Service Nondiscrimination Rules
- ------------------------------------------------
If you are a highly compensated employee, a portion of your
contributions allocated to your 401(k) account and/or employer
contributions allocated to your Regular account may have to be
returned to you in order to comply with special Internal Revenue
Service (IRS) nondiscrimination rules (see "Plan Limitations"
section of this booklet for other limitations). In general, a
highly compensated employee is an employee who at any time during
the current or preceding year:
(a) was a 5% owner,
(b) received annual compensation from the employer in
excess of $75,000 (indexed for cost-of-living adjustments,
if any),
(c) received annual compensation from the employer in excess
of $50,000 (indexed for cost-of-living adjustments, if
any) and was in the top 20% of employees by compensation
in such year, or
(d) was an officer of the employer and received annual
compensation from the employer in excess of $45,000
(indexed for cost-of-living adjustments, if any).
(W2)
PLAN SALARY
Plan Salary is defined as total compensation as reported on your
Form W-2, exclusive of any compensation deferred from a prior
year, plus pre-tax contributions which you make to an Internal
Revenue Code Section 401 (k) plan or Section 125 cafeteria plan.
However, Plan Salary for any year may not exceed $150,000
(indexed for cost-of-living adjustments, if any).
4
<PAGE>
<PAGE>
INVESTMENT OF CONTRIBUTIONS
Contributions are invested by the Trustee at your direction in
one or more of the following five investment funds:
INVESTMENT FUND A - A passively managed, diversified equity
portfolio with the objective of simulating
the performance of the Standard & Poor's
Composite Index of 500 stocks, selected by
Bankers Trust Company, New York, as Trustee.
An investment in Fund A provides an
opportunity for investment growth generally
consistent with that of widely traded common
stocks, but with a corresponding risk of
decline in value.
INVESTMENT FUND B - A portfolio of fixed income contracts
primarily managed by Bankers Trust Company
with the objective of maximizing income at
minimum risk of capital. Contributions are
invested in fixed income instruments
including but not limited to group annuity
contracts issued by insurance companies.
INVESTMENT FUND C - A passively managed, diversified portfolio
of stocks with the objective of replicating
the performance of the S&P MidCap Index,
managed by State Street Asset Management.
An investment in Fund C provides an
opportunity for investment return generally
consistent with that of smaller to medium
sized company stocks, with an above average
potential for increase or decrease in value.
INVESTMENT FUND D - A government instrument fund with the
objective of maximizing income at minimum
risk of capital with underlying investments
in obligations issued or guaranteed by the
United States government or agencies or
instrumentalities thereof, selected by
Bankers Trust Company as Trustee.
INVESTMENT FUND E - A portfolio of high quality treasury,
agency, corporate and asset/mortgage-backed
securities managed by State Street Asset
Management with the objective of replicating
the total performance of the Lehman Brothers
Aggregate Bond Index.
5
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Contributions made by you and on your behalf are invested at your
direction in one or more of these funds in any combination of
multiples of 5%. You may apply different investment instructions
to amounts already accumulated as opposed to future
contributions. Changes in investment instructions may be made by
submitting a properly completed form or by use of Pentegra by
Phone.
Any changes received by 4 PM Eastern Time (Stock Market Closing)
will be processed at the day's current business price.
Transaction changes received after 4 PM Eastern Time (Stock
Market Closing) will be processed on the next business day. Your
Plan allows for a change of investment direction on a daily
basis.
Amounts invested in Fund B may not be transferred directly to
Fund D or Fund E. Fund B amounts must first be transferred to
Fund A and/or Fund C and remain in Fund A and/or Fund C for some
minimum period of time (currently three months) before such
amounts may be transferred to Fund D or Fund E. Amounts
transferred from Fund A and/or Fund C to Fund B will be deemed to
have first come from amounts, if any, which could not be
transferred directly to Fund D or Fund E at that time.
Each investment instruction may apply to either future
contributions or your already accumulated account, or both. Each
change is effective on the valuation date (see "Valuation of
Accounts" section of this booklet) coinciding with or next
following the day on which your written notice of change is
received by the Board (except to the extent described in the
"Negative Cash Flow Provision" section of this booklet).
If no investment direction is given, all contributions credited
to a member's account will be invested in Fund D.
(Daily Changes)
6
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VALUATION OF ACCOUNTS
The Plan uses a unit value system for valuing each member's
account. Under this system each member's share in an Investment
Fund is represented by units. The number of new units credited to
a member in an Investment Fund is determined by dividing the
total amount of contributions (both employee and employer)
invested in the Fund by the unit value of the Fund as of the next
valuation date. The total value of a member's share in an
Investment Fund as of any valuation date is determined by
multiplying the total number of units to the member's credit by
the unit value of the Fund on that date.
The sum of your shares in the available investment funds would
represent the value of your plan account.
NOTE: If for some reason (such as the shut down of the financial
markets) the underlying portfolios of any Investment Fund cannot be
valued on the last business day of a month, the valuation date for
such Investment Fund shall be the next subsequent date on which the
underlying portfolios can be valued.
REPORTING TO MEMBERS
As soon as practicable after the end of each calendar quarter you
will receive a Personal Statement from the Plan. This Statement
provides information about your account including its market value,
the number of units you have in Funds A, B, C, D and E, the unit
value of each Fund as of the end of the quarter and the amount of
contributions you have made.
7
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<PAGE>
VESTING
"Vesting" is the process under which you earn a non-forfeitable
right to the units in your account. You are always 100% vested
(i.e., you will not give up any units when you terminate
employment) in any contributions you make to the Thrift Plan.
With respect to any employer contributions credited to your
account, the following schedule will dictate when vesting will
occur:
Years of Service Vesting Percentage
---------------- ------------------
Less than 1 0%
1 25%
2 50%
3 75%
4 or more 100%
You will also become 100% vested in the employer contributions
and earnings thereon credited to your account upon your death,
approved disability or attainment of age 65 while employed with
this employer.
If you terminate employment with this employer prior to
completing 1 year of service, you will forfeit all of the
employer contributions and earnings thereon credited to your
account. However, if you are reemployed by this employer prior to
incurring 5 consecutive 1 -year breaks in service, measured from
your date of termination, you are eligible to have the amount of
the forfeiture and your corresponding vesting service restored to
your account.
If you terminate employment with this employer after completing 1
year of service, but prior to completing 4 years of service, you
will forfeit the non-vested portion of the employer contributions
and earnings thereon credited to your account. If you are
reemployed by this employer prior to incurring 5 consecutive
1-year breaks in service, you are eligible to have the amount of
the forfeiture restored to your account. If you received a
distribution of the vested portion of your account prior to
incurring 5 consecutive 1-year breaks in service, such
restoration is conditioned on your paying back to your account
the amount of your prior vested balance within 5 years of the
date it was distributed to you. In either event, your prior
vesting service will be recredited to your account.
8
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<PAGE>
ACCOUNT WITHDRAWAL
You may make a total or partial withdrawal of the vested portion
of your account by filing the appropriate form with your employer
or the Thrift Plan Office. A withdrawal is based on the unit
values on the valuation date (see "Valuation of Accounts" section
of this booklet) coinciding with or next following the date that
written notice is received by the Thrift Plan Office (except to
the extent described in the "Negative Cash Flow Provision"
section of this booklet).
Under current law, an excise tax of 10% is generally imposed on
the taxable portion of withdrawals occurring prior to your
attainment of age 59 1/2%. There are certain exceptions to the
10% excise tax. For example, the 10% excise tax will not apply to
withdrawals made on account of separation from service at or
after attainment of age 55, death or disability.
WHILE EMPLOYED
A. From the Regular Account:
Not more than one voluntary withdrawal may be made from your
Regular account in a calendar year unless it is limited to your
own contributions, if any, made prior to January 1,1987 ("pre
1987 contributions") without earnings. When you make a
withdrawal, you may continue making contributions to the Plan.
No partial withdrawal of less than $1,000 will be permitted
unless it is for either the full amount of (a) your own "pre-1987
contributions" without earnings, (b) your own contributions
(pre-1987 plus post-1986) and earnings on them or (c) the total
vested balance of your Regular account.
In general, employer contributions credited on your behalf will
not be available for in-service withdrawal until such employer
contributions have been invested in the Plan for at least 24
months (2 years) or you have been a participant in the Plan for
at least 60 months (5 years) or the attainment of age 59 1/2.
B. From the 401(k) Account:
Not more than one withdrawal may be made from your 401(k) account
in a calendar year.
As required by Internal Revenue Service Regulations, a withdrawal
from your 401(k) account prior to age 59 1/2 or termination of
employment can only be made on account of hardship. The existence
of an immediate and heavy financial need, and the lack of any
other available financial resources to meet this need, must be
demonstrated for a hardship withdrawal. The following situations
will be considered to constitute an immediate and heavy financial
need:
1) Medical expenses (other than amounts paid by insurance).
2) The purchase of a principal residence (mortgage payments are
excluded).
9
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<PAGE>
3) Post-secondary education tuition (for the next semester or
quarter).
4) The prevention of the eviction from a principal residence or
foreclosure on the mortgage of a principal residence.
You will be required to receive a distribution of the remaining
available vested balance, if any, of your Regular account and your
Rollover account, if any, prior to making a hardship withdrawal
from your 401(k) account. In no event may the maximum amount of a
hardship withdrawal from your 401(k) account exceed the value of
your 401(k) account as of December 31, 1988 plus the amount of any
401(k) contributions which you make to the Plan on or after January
1, 1989 reduced by the amount of any hardship withdrawals which you
make from your 401(k) account on or after January 1, 1989. No
partial withdrawal of less than $1,000 will be permitted unless it
is for either (a) the amount necessary to satisfy your hardship or
(b) the total vested balance of your 401(k) account.
In general, employer contributions credited on your behalf will not
be available for in-service withdrawal until such employer
contributions have been invested in the Plan for at least 24 months
(2 years) or you have been a participant in the Plan for at least
60 months (5 years) or the attainment of age 59 1/2.
C. From the Rollover Account
Not more than one withdrawal may be made from your Rollover account
in a calendar year. No partial withdrawal of less than $1,000 will
be permitted unless it is for the total balance of your Rollover
account.
(Revised 12/93)
UPON TERMINATION OF EMPLOYMENT
You may leave your account with the Thrift Plan and defer receipt
of your vested balance until April 1 of the calendar year following
the calendar year in which you attain age 70 1/2, except to the
extent that your vested account balance as of the date of your
termination is less than $500, in which case your interest in the
Plan will be cashed out and payment sent to you.
Except as provided above, you may make one withdrawal per account
each calendar year or defer withdrawal from your account until the
April 1 of the calendar year following the calendar year in which
you attain age 70 1/2. You may continue to change the investment
instructions (see "Investment of Contributions" section of this
booklet) with respect to your remaining account balance.
If your total vested account equals or exceeds $500, you may elect,
in lieu of a lump sum payment, to be paid in annual installments
over a period of 2-10, 15 or 20 years with the right to take in a
lump sum the vested balance of your account at any time during such
payment period. If your life expectancy is actuarialy determined to
be less than the period you elect, the maximum period over which
you can receive annual installments will be the next lower payment
period.
(Revised 9/93)
10
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<PAGE>
UPON DISABILITY
If you are disabled in accordance with the definition of disability
under the Thrift Plan, you will be entitled to the same withdrawal
rights as if you had terminated your employment (see "Account
Withdrawal - Upon Termination of Employment" section of this
booklet).
You are disabled under the Thrift Plan if you are eligible to
receive (i) disability insurance benefits under Title II of the
Federal Social Security Act or (ii) disability benefits under the
Financial Institutions Retirement Fund or any other Internal
Revenue Service qualified employee benefits plan or long-term
disability plan of your employer.
UPON DEATH
If you die when you are a member of the Plan, the value of your
entire account will be payable to your beneficiary. This payment
will be made in the form of a lump sum, unless the payment would
exceed $500, and you had elected prior to your death that the
payment be made in annual installments over a period not to exceed
5 years (10 years if your spouse is your beneficiary). If such an
election is not in effect at the time of your death, your
beneficiary may elect to receive the benefit in the form of annual
installments over a period not to exceed 5 years (10 years if your
spouse is your beneficiary) or make withdrawals as often as once
per year, except that any balance remaining must be withdrawn by
the 5th anniversary (10th anniversary if your spouse is your
beneficiary) of your death.
If you are married, your spouse will be your beneficiary unless
your spouse consents in writing to the designation of a different
beneficiary.
REENROLLMENT
If you terminate employment and are subsequently reemployed by the
same or another participating employer, you will be eligible for
immediate reenrollment.
ROLLOVERS
If you are eligible to participate in the Plan, you may make a
rollover contribution of an eligible rollover distribution from any
other Internal Revenue Service qualified retirement plan or an
individual retirement arrangement (IRA). These funds will be
maintained in a separate rollover account in which you will have a
nonforfeitable vested interest. Your withdrawal rights while in
service and upon termination of employment are generally the same
as with respect to your Regular account under the Thrift Plan (see
"Account Withdrawal" section of this booklet).
(Revised 9/93)
11
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<PAGE>
LOANS
You may borrow from the vested portion of your Regular account
and/or 401(k) account and/or your Rollover account, if you have
one, any amount between $1,000 and $50,000 (reduced by your highest
outstanding loan balance(s) from the Thrift Plan during the
preceding 12 months), subject to the following further limitation:
In no event may you borrow more than 50% of the combined vested
balance of your Regular account, your 401(k) account and your
Rollover account, if any.
You may borrow only once in each calendar year from your Regular
and/or 401(k) account and once in each calendar year from your
Rollover account, if any. Each loan must be for at least $1,000.
With respect to a loan from your 401(k) and/or Regular accounts,
you may choose to borrow first from either your Regular or 401(k)
account. Whichever account you borrow from first, such account must
be exhausted before you may borrow any amount from the other
account. A loan from your Rollover account, if you have one, will
be considered a separate loan. The amount of your loan will first
be deducted from the taxable portion of your account and then from
the after-tax portion, if any.
The amount of your loan will be deducted on the valuation date (see
"Valuation of Accounts" section of this booklet) coinciding with or
next following the date the Thrift Plan Office receives your
properly executed Loan Application, Promissory Note and Disclosure
Statement (except to the extent described in the "Negative Cash
Flow Provision" section of this booklet). On request, your employer
or the Thrift Plan Office will provide you with the application
form. The loan will not affect your right to continue making
contributions or to receive the corresponding employer matching
contributions.
Your loan will be deducted proportionately from the Funds in which
the account (from which you are taking the loan) is invested. Your
loan repayments will be credited in accordance with your investment
instructions in effect at the time of each repayment.
The rate of interest for the term of the loan will be established
as of the loan date, and shall be a reasonable rate of interest
generally comparable to the rates of interest then in effect at a
major banking institution (e.g., the Barron's Prime Rate [base
rate] plus 1%).
Repayments are made through salary deductions and will be
transmitted along with regular monthly contribution reports. The
repayment period is between 1 and 15 years for loans used
exclusively for the purchase of a primary residence or 1 and 5
years for all other loans, at your option. After 12 monthly
payments have been made, you may repay the outstanding balance of
the loan. If a loan includes any amounts from your 401(k) account,
you will not be permitted to default on the loan repayment while
employed. Your employer is required to withhold the loan repayments
from your monthly salary.
12
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<PAGE>
Crediting of repayments will take the following form: As you
repay the loan, the principal portion, together with the
interest, will be credited to your account, after deducting 2% of
the outstanding balance to cover administrative expense. In this
way, you will be paying interest to yourself.
In the event that you leave employment or die before repaying the
loan, the outstanding balance will be due and, if not paid within
60 days, will be deemed a distribution, unless you elect to
continue to repay the loan on a monthly basis directly to the
Thrift Plan office.
(Revised 9/93)
NEGATIVE CASH FLOW PROVISION
In the event that there is a negative cash flow (which may be
caused by a large number of withdrawals, loans and/or investment
direction changes out of Investment Funds A, B, C, D or E)
coupled with a decline in the stock market shortly after a
month-end valuation, the lesser of the month-end unit value or
the sale date estimated unit value will be used to value that
portion of the withdrawals, loans and/or investment direction
changes which must be provided through the sale of existing
units.
(Revised 1/93)
13
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<PAGE>
PLAN LIMITATIONS
- - Internal Revenue Service ("IRS") requirements impose certain
limitations on the amount of contributions that may be made to
this and other qualified plans. In general, the annual
"contributions" made to a defined contribution plan such as this
Plan, in respect of any member, may not exceed the lesser of 25%
of the member's total compensation or $30,000. (This amount may
be subject to periodic adjustment by the IRS at some time in the
future.) For this purpose, "contributions" include employer
contributions, member 401(k) contributions and member after-tax
contributions. The annual member contributions allocated to a
member's 401(k) account may not exceed the lesser of 25% of the
member's total compensation or $7,000 (indexed for cost-of-living
adjustments, if any). Further, if your employer has another
tax-qualified plan in effect, these limits are subject to
additional restrictions.
- - Each member and beneficiary assumes the risk in connection
with any decrease in the market value of his account. The benefit
to which you may be entitled upon your withdrawal of account
cannot be determined in advance.
- - As a defined contribution plan, the Plan is not covered by
the plan termination insurance provisions of Title IV of the
Employee Retirement Income Security Act of 1974 ("ERISA").
Therefore, your benefits are not insured by the Pension Benefit
Guaranty Corporation in the event of a plan termination.
- - The Trustee is empowered to charge against and pay out of
the Trust Fund, to the extent not paid by the employers, all
proper costs of operation and administration of the Plan,
including the expenses and compensation of the Trustee, expenses
of the Board and compensation for its agents.
- - Except as may otherwise be required by applicable law or
pursuant to the terms of a Qualified Domestic Relations Order,
amounts payable by the Plan generally may not be assigned, and if
any person entitled to a payment attempts to assign it, his
interest in the amount payable may be terminated and held for the
benefit of that person or his dependents.
- - If the Board cannot locate any person entitled to a payment
from the Plan and if 5 years have elapsed from the due date of
such payment, the Board may cancel all payments due him to the
extent permitted by law.
- - Membership in the Plan does not give you the right to
continued employment with your employer or affect your employer's
right to terminate your employment.
- - Your employer's continued participation is subject to IRS
approval and any requirements the IRS may impose.
- - An employer may terminate its participation in the Plan at
any time. In addition, the Board retains the right to terminate
the Plan or an employer's participation in the Plan in certain
circumstances. If the Plan is terminated or if your employer's
participation in the Plan is terminated, there will be no further
contributions to the Plan for your account.
14
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<PAGE>
TOP HEAVY INFORMATION
A "top heavy" plan is a plan under which more than 60% of the
accrued benefits (account values) are for key employees. Key
employees generally include officers and shareholders earning
more than $45,000 (indexed for cost-of-living adjustments, if
any) per year. If your employer's plan is top heavy for a
particular plan year, you may be entitled to a minimum employer
contribution equal to the lesser of 3% of your Plan Salary or the
greatest percentage contributed by the employer for any key
employee. This minimum contribution would be offset by the
regular contribution made by your employer (see "Plan
Contributions" section of this booklet).
In order to receive the minimum contribution for any plan year,
you must be employed on the last day of the plan year (December
31). If your employer also provides a defined benefit or another
defined contribution plan, your minimum benefit may be provided
under such plan.
DISPUTED CLAIMS PROCEDURE
If you disagree with respect to any benefit to which you feel you
are entitled, you should make written claim to the President of
the Plan. If your claim is denied, you will receive written
notice explaining the reason for the denial within 90 days after
the claim is filed.
The President's decision shall be final unless you appeal such
decision in writing to the Board of Directors of the Plan at 108
Corporate Park Drive, White Plains, NY 10604, within 60 days
after receiving the notice of denial. The written appeal should
contain all information you wish to be considered. The Board will
review the claim within 60 days after the appeal is made. Its
decision shall be in writing, shall include the reason for such
decision and shall be final.
15
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<PAGE>
STATEMENT OF MEMBER'S RIGHTS
As a member of the Plan, you are entitled to certain rights and
protections under ERISA which provides that all members shall be
entitled to:
- - Examine, without charge, at the Plan Administrator's office
or at other specified locations, all plan documents, and copies
of all documents filed by the Plan with the U. S. Department of
Labor such as detailed annual reports and plan descriptions.
- - Obtain copies of all plan documents and other plan
information upon written request to the Plan Administrator. The
Administrator may make a reasonable charge for the copies.
- - Receive a summary of the Plan's annual financial report. The
Plan Administrator is required by law to furnish each member with
a copy of such summary.
In addition to creating rights for Plan members, ERISA imposes
duties upon the people who are responsible for the operation of
the Plan. The people who operate your Plan, called "fiduciaries",
have a duty to do so prudently and in the interest of you and
other plan members and beneficiaries. No one may fire you or
otherwise discriminate against you in any way to prevent you from
obtaining a benefit or exercising your rights under ERISA. If
your claim for a benefit is denied in whole or in part, you will
receive a written explanation of the reason for the denial. As
already explained, you also have the right to have your claim
reconsidered.
Under ERISA, there are steps you can take to enforce the above
rights. For instance, if you request materials from the Plan and
do not receive them within 30 days, you may file suit in a
federal court. In such a case, the court may require the Plan
Administrator to provide the materials and pay you up to $100 a
day until you receive them, unless such materials were not sent
for reasons beyond the Administrator's control. If you have a
claim for benefits which is denied or ignored, in whole or in
part, you may file suit in a state or federal court.
If it should happen that Plan fiduciaries misuse the Plan's
money, or if you are discriminated against for asserting your
rights, you may seek assistance from the U. S. Department of
Labor or you may file suit in a federal court. The court will
decide who should pay court costs and legal fees. If you are
successful, the court may order the person you have sued to pay
these costs and fees. If you lose, the court may order you to pay
such costs and fees (for example, if it finds your claim is
frivolous).
If you have any questions about your Plan, you should contact the
Plan Administrator. If you have any questions about this
statement or your rights under ERISA, you should contact the
nearest Area Office of the U.S. Labor-Management Services
Administration, Department of Labor.
This Statement of ERISA Rights is required by federal law and
regulation.
16
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<PAGE>
OTHER PLAN INFORMATION
PLAN SPONSOR
The Plan is sponsored by the --
Financial Institutions Thrift Plan
108 Corporate Park Drive
White Plains, NY 10604
Telephone (914) 694-1300
Employer Identification Number- 13 6321489
Plan Number 002
Plan Year End December 31
PLAN ADMINISTRATOR:
The Plan Administrator is the President of the Plan whose place
of business is the office of the Financial Institutions Thrift
Plan. The President is also the person designated as agent for
service of legal process. Service of legal process may also be
made upon the Plan Trustee.
BOARD OF DIRECTORS:
The make-up of the Board changes from year to year, but you may
refer to the most recent Annual Report (which is sent to your
employer) for a current listing of the Board members and their
places of business.
TRUSTEE:
The name and address of the current Trustee(s) of the Plan may be
found in the Annual Report. A Trustee may be changed from time to
time by the Board.
PARTICIPATING EMPLOYERS:
A listing of employers participating in the Plan is available upon
request.
17
ENROLLMENT APPLICATION HOME SAVINGS BANK, SSB
EMPLOYEE MUST COMPLETE SECTIONS A, B, C AND REVERSE SIDE
A. EMPLOYEE DATA (Please Type or Print Clearly):
1. Social Security Number _________________________________
2. Name_____________________________________________________
Last First Middle Initial
3. Current Address__________________________________________
Street City State Zip Code
4. Birth Date ________-______-19_____ To be completed for
MM DD YY Home Savings Bank, SSB's
Authorized Representative
5. Check appropriate boxes:
[ ] Male [ ] Female Participation Date
[ ] Single [ ] Married ________-01, 19__
MM YY
Service Date
_______-_____, 19__
MM DD YY
Annual Gross Salary
$__________
________% 5% Stock Owner
________ Officer
B. EMPLOYEE CONTRIBUTIONS: (Please choose one option)
[ ] (1) I elect to contribute the following percentage
of my monthly Plan salary and authorize such
contributions to be deducted from my salary:
% of pre-tax deferrals ________%
MUST BE A WHOLE PERCENTAGE AND MAY NOT EXCEED
15%.
[ ] (2) I hereby direct that my contribution rate under
the Home Savings Bank, SSB Employees' Savings
and Profit Sharing Plan be the same as my
contribution rate in effect March 1, 1997 under
the Financial Institutions Thrift Plan.
C. INVESTMENT INSTRUCTIONS: (Please choose one option).
(Note: If no direction is made, all contributions will be
invested in the Stable Value Fund.)
[ ] (1) I hereby direct that my Total Thrift Plan
Account to be transferred from my Thrift Plan
Account to Home Savings Bank, SSB Employees'
Savings and Profit Sharing Plan to be invested
in whole percentages as follows:
500 Stock Index Fund ________%
Stable Value Fund ________%
MidCap 400 Stock Index Fund ________%
Government Money Market Fund ________%
Bond Index Fund ________%
NewSouth Bancorp, Inc. Common
Stock Fund ________%
____________________________
100 %
[ ] (2) I hereby direct that all my Investment
Instructions under the Home Savings Bank, SSB
Employees' Savings and Profit Sharing Plan be
the same as my Investment Instructions in effect
March 1, 1997 under the Financial Institutions
Thrift Plan.
D. NEW INVESTMENT INSTRUCTIONS: (Note: If no direction is made,
all contributions will be invested in the GOVERNMENT MONEY MARKET
FUND.) * Amounts invested in the Stable Value Fund may not be
transferred directly to this Fund. I direct that all future
contributions made on my behalf be invested in whole percentages
as follows:
500 Stock Index Fund ________%
Stable Value Fund ________%
MidCap 400 Stock Index Fund ________%
Government Money Market Fund * ________%
Bond Index Fund * ________%
____________________________
100 %
(continued on reverse side)
Pentegra Services, Inc. - 108 Corporate Park Drive - White Plains
NY 10604 - 914-694-1300 - 800-872-3473 - FAX 914-694-6429
<PAGE>
<PAGE>
DESIGNATION OF BENEFICIARY
I hereby request that any benefit under the Home Savings Bank,
SSB Employees' Savings & Profit Sharing Plan which becomes
payable in the event of my death be paid as set forth in the
option(s) completed below. This request supersedes any previous
designation of a beneficiary that I may have made.
1. Spouse -
Primary TO _________________, _______________, __________
Beneficiary Name Relationship Social
Security No.
NOTE FOR MARRIED PARTICIPANTS: FEDERAL LEGISLATION REQUIRES THAT
YOUR SPOUSE BE NAMED BENEFICIARY FOR YOUR ACCOUNT UNLESS A SIGNED
WAIVER IS PROVIDED BY YOU AND YOUR SPOUSE. (SEE YOUR PLAN
ADMINISTRATOR FOR DETAILS AND COMPLETE WAIVER SECTION BELOW.)
2. OTHER To the following named person(s) as are living at
PRIMARY my death:
BENEFICIARIES ----------------------, -----------, ----%, --------------
Name and Address Relationship Social Security
No.
----------------------, -----------, ----%, --------------
Name and Address Relationship Social Security
No.
If not living at my death, to the following named
persons as are living at my death:
3. CONTINGENT
BENEFICIARIES
----------------------, -----------, ----%, --------------
Name and Address Relationship Social Security
No.
----------------------, -----------, ----%, --------------
Name and Address Relationship Social Security
No.
----------------------, -----------, ----%, --------------
Name and Address Relationship Social Security
No.
4. ESTATE OF INSURED To the executors or administrators of
my estate, as named below or in my
will in effect at the time of my death.
------------------ -----------------
Name Address
- -------------------------- ----------------------- ----------
Signature of Employee Signature of Witness Date
WAIVER TO BE COMPLETED BY SPOUSE IF EMPLOYEE ELECTS OTHER THAN 1
ABOVE
I, the undersigned, am the employee's spouse and agree to the
designation of the above-named primary and contingent
beneficiary(ies). I understand that any death benefit payable
under the Home Savings Bank, SSB Employees' Savings & Profit
Sharing Plan shall be paid in accordance with the above
designations.
---------------------------
Signature of Spouse
State of: ________________ ss:
County of: ________________
On this ____ day of _______________, 19__, personally appeared
before me the said named __________________________, to me known
and known to me to be the person described in and who executed
the foregoing instrument, and he (she) acknowledged that he (she)
executed the same.
(Seal) _______________________ (Notary Public)
STAMP OR SEAL REQUIRED My commission expires ___________
_________________________________________________________________
HOME SAVINGS BANK, SSB MUST COMPLETE THE FOLLOWING:
I hereby direct PSI to enroll the above member in Home Savings
Bank, SSB Employees' Savings & Profit Sharing Plan based on the
information contained herein.
_______________________________________________________________
Signature of Home Savings Bank, SSB's Authorized Representative
____________________________________
Date
February 19, 1997
Board of Directors
NewSouth Bancorp, Inc.
1311 Carolina Avenue, P.O. Box 2047
Washington, North Carolina 27889
Re: Registration Statement on Form S-8
---------------------------------------------
Home Savings Bank, SSB Employees' Savings and
Profit Sharing Plan and Trust
Dear Board Members:
We have acted as special counsel to Newsouth Bancorp, Inc.,
a Delaware corporation (the "Company"), in connection with the
preparation of the Registration Statement on Form S-8 filed with
the Securities Exchange Commission (the "Registration Statement")
under the Securities Act of 1933, as amended, relating to
participation interests in the Home Savings Bank, SSB Employees'
Savings and Profit Sharing Plan and Trust (the "Plan") and the
sale to Plan participants of shares of common stock, par value
$.01 per share (the "Common Stock") of the Company, all as more
fully described in the Registration Statement. You have
requested the opinion of this firm with respect to certain legal
aspects of the proposed offering.
We have examined such documents, records and matters of law
as we have deemed necessary for purposes of this opinion and
based thereon, we are of the opinion that the Common Stock when
issued pursuant to and in accordance with the terms of the Plan
will be legally issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement on Form S-8 and to
references to our firm included under the caption "Legal Opinion"
in the Prospectus which is part of the Registration Statement.
Very truly yours,
Housley Kantarian & Bronstein, P.C.
By: /s/ J. Mark Poerio
-------------------------------------
J. Mark Poerio, Esquire
Internal Revenue Service Department of the Treasury
District Director
EP/EO Division
2 Cupania Circle
Monterey Park, CA 91755-7406
Date: December 20, 1995
ADVISORY LETTER NUMBER:
V1950507
Directors of Financial TYPE OF PLAN:
Institutions Thrift Plan Thrift Plan
108 Corporate Park PERSON TO CONTACT:
P.O. Box 847 MaryAnn Jimenez
White Plains, NY 10604 TELEPHONE NUMBER:
213-725-0905
REFER REPLY TO:
EP/EO:EPSB:EPSG-1:MJ
ORIGINAL DATE RECEIVED:
June 30, 1994
Dear Applicant:
We have reviewed your specimen document identified above as
part of our Volume Submitter Program. It is our opinion that the
document meets the requirements of the Internal Revenue Code as
amended by the Tax Reform Act of 1986.
This opinion may change based on the release of temporary
and/or final regulations or other enhancements of the tax law,
which would affect deferred compensation plans issued after the
date of this letter. In the event this occurs, you will be
notified by this office of the need for amendments to your
document.
The acceptability of the form of this document does not
constitute a determination of the qualification of an adopting
employer's plan under section 401(a) of the Internal Revenue
Code, or of the exemption of the related trust or custodial
account under section 501(a). The qualification of the adopting
employer may also be affected by the options or variables
selected by the employer.
An employer adopting this specimen document who wants such a
determination and reliance on the volume submitter letter must
file Form 5307, Short Form Application For Determination For
Employee Benefit Plan, with the Key District Director. Adopting
employers must individually amend the plan to remain in
compliance. A copy of this letter must be submitted with each
application. Any alteration made to the specimen document after
the date of this letter must be indicated in a cover letter.
If you have any questions, please contact the person whose
name and telephone number are shown above.
Sincerely,
Chief, EP South Branch
EP/EO Division
Los Angeles Key District
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
NewSouth Bancorp, Inc.
We consent to the incorporation by reference in this registration
statement of NewSouth Bancorp, Inc. on Form S-8, regarding Home
Savings Bank, SSB Employees' Savings and Profit Sharing Plan and
Trust, of our report dated October 18, 1996, on our audits of the
consolidated financial statements of Home Savings Bank, SSB as of
September 30, 1996 and 1995, and for the three years then ended,
which report was included in the Prospectus for the common stock
of NewSouth Bancorp, Inc. and incorporated by reference herein.
We also consent to the reference to our firm under the caption
"Experts."
/s/ Coopers and Lybrand L.L.P.
COOPERS AND LYBRAND L.L.P.
Raleigh, North Carolina
February 18, 1997
<TABLE>
<C> <S> <C>
Form 5500-C/R Return/Report of Employee Benefit Plan OMB Nos. 1210-0016
Department of the Treasury (With fewer than 100 participants) 1210-0089
Internal Revenue Service This form is required to be filled under sections 104 and 4065 of the Employee
---------- Retirement Income Security Act of 1974 and sections 6039D, 6047(e), -------------------
Department of Labor 6057(b), and 6058(a) of the Internal Revenue Code. 1995
Pension and Welfare Benefits Administration See separate instructions. -------------------
---------- This Form is Open
Pension Benefit Guaranty Corporation to Public Inspection.
- ------------------------------------------------------------------------------------------------------------------------------------
For the calendar plan year 1995 or fiscal plan year beginning , 1995, and ending , 1995
- ------------------------------------------------------------------------------------------------------------------------------------
If A(1) through A(4), B, C, and/or D do not apply to this year's return/report For IRS Use Only
leave the boxes unmarked. EP-ID
You must check either box A(5) or A(6), whichever is applicable. See instructions. -------------------------------------------
A This return/report is: (5) Form 5500-C filer check here. . . . [X]
(1) [_] the first return/report filed for the plan; (Complete only pages 1 and 3 through 6)
(2) [_] an amended return/report (Code section 6039D file's see
(3) [_] the final return/report filed for the plan; or instructions on page 5.)
(4) [_] a short plan year return/report (less than 12 months). (6) Form 5500-R filer check here. . . . [_]
(Complete only pages 1 and 2. Detach
pages 3 through 6 before filing.) If
you checked box (1) or (3), you must
file a Form 5500-C. (See page 6 of the
instructions.)
IF ANY INFORMATION ON A PREPRINTED PAGE 1 IS INCORRECT, CORRECT IT. IF ANY INFORMATION IS MISSING, ADD IT.
PLEASE USE RED INK WHEN MAKING THESE CHANGES AND INCLUDE THE PREPRINTED PAGE 1 WITH YOUR
COMPLETED RETURN/REPORT.
B Check here if any information reported in 1a, 2a, 2b, or 5a changed since the last return/report for this plan . . . . . . [_]
C If your plan year changed since the last return/report, check here. . . . . . . . . . . . . . . . . . . . . . . . . . . . . [_]
D If you filed for an extension of time to file this return/report, check here and attach a copy of the approved extension. . [_]
- ------------------------------------------------------------------------------------------------------------------------------------
1a Name and address of plan sponsor (employer, if for a single-employer plan) 1b Employer identification number (EIN)
(Address should include room or suite no.) 56 0266599
---------------------------------------
1c Sponsor's telephone number
Home Savings Bank SSB 919-946-4178
1311 Carolina Avenue ---------------------------------------
Washington NC 27889 1d Business code (see instructions,
page 19)
6030
---------------------------------------
1e CUSIP issuer number
n/a
- ------------------------------------------------------------------------------------------------------------------------------------
2a Name and address of administrator (if same as plan sponsor, enter "Same") 2b Administrator's EIN
13 3381592
Michael J. Reynolds, President/Financial Institutions Thrift Plan (FITP) ---------------------------------------
108 Corporate Park Drive 2c Administrator's telephone number
White Plains, NY 10604 (914) 694-1300
- ------------------------------------------------------------------------------------------------------------------------------------
3 If you are filing this page without the preprinted historical plan information and the name, address, and EIN of the plan
sponsor or plan administrator has changed since the last return/report filed for this plan, enter the information from the last
return/report on lines 3a and/or 3b and complete line 3c.
a Sponsor ________________________________________________ EIN _________________ Plan number ________________
b Administrator ________________________________ EIN ____________________________________________
c If line 3a indicates a change in the sponsor's name, address, and EIN, is this a change in sponsorship only? (See line 3c on
page 9 of the instructions for the definition of sponsorship.) Enter "Yes" or "No."
- ------------------------------------------------------------------------------------------------------------------------------------
4 ENTITY CODE. (If not shown, enter the applicable code from page 9 of the instructions.) F
- ------------------------------------------------------------------------------------------------------------------------------------
5a Name of plan Financial Institutions Thrift Plan as adopted by Home Savings 5b Effective date of plan
-------------------------------------------------------------------- (mo., day, yr.)
Bank, SSB 10-01-92
--------------------------------------------------------------------------------- ---------------------------------------
- -------------------------------------------------------------------------------------------- 5c Three-digit
All filers must complete 6a through 6d, as applicable. plan number 002
6a [_] Welfare benefit plan 6b [X] Pension benefit plan ---------------------------------------
(If the correct codes are not preprinted below, enter the applicable codes from [6] [_] [_] [_] [_] [_] [_] [_]
page 9 of the instructions in the boxes.) [_] [_] [_] [_] [_] [_] [_] [_]
6-defined contribution plan/multiple employer-other
6c Pension plan features. (If the correct codes are not preprinted below, enter the applicable
pension plan feature codes from page 9 of the instructions in the boxes.) [C] [G] [_] [_] [_] [_] [_] [_]
6d [_] Fringe benefit plan. Attach Schedule F (Form 5500). See instructions.
- ------------------------------------------------------------------------------------------------------------------------------------
Caution: A penalty for the late or incomplete filing of this return/report will be assessed unless reasonable cause is established.
- ------------------------------------------------------------------------------------------------------------------------------------
Under penalties of perjury and other penalties set forth in the instructions, I declare that I have examined this return/report,
including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete.
Signature of employer/plan sponsor /s/ Kristie W. Hawkins Date 5-29-96
-------------------------------------------------------------- ----------------------------
Type or print name of individual signing for employer/plan sponsor Kristie W. Hawkins, Controller-Treasurer
----------------------------------------------------------------
Signature of plan administrator _____________________________________________________ Date _________________________
Type or print name of individual signing for plan administrator
- ------------------------------------------------------------------------------------------------------------------------------------
For Paperwork Reduction Act Notice, see page 1 of the instructions. MGA Form 5500-C/R (1995)
</TABLE>
<PAGE>
<PAGE>
<TABLE>
<S> <C>
Form 5500-C/R (1995) Page 3
Complete page 1, and pages 3 through 6 only, if you are filing Form 5500-C. (See instructions on page 13.)
- -------------------------------------------------------------------------------------------------------------------------
6e Check all applicable investment arrangements below (See instructions on page 13):
(1) [_] Master trust (2) [_] 103-12 investment entity
(3) [_] Common/collective trust (4) [_] Pooled separate account
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
.........................................................................................................................
f Single-employer plans enter the tax year end of the employer in which this plan year ends Month _____ Day _____
Year _____
g Is any part of this plan funded by an insurance contract described in Code section 412(i)?................... [_] Yes
[_] No
h If line 6g is "Yes," was the part subject to the minimum funding standards for either of the prior 2 plan years?
[_] Yes [_] No
- -------------------------------------------------------------------------------------------------------------------------
7a Total participants: (1) At the beginning of plan year 75 (2) At the end of plan year 72
----------------------- ------------
b Enter number of participants with account balances at the end of the plan year. (Defined benefits plans do not
complete this item.) _______________________
c Number of participants that terminated employment during the plan year with accrued benefits that were less than 100%
vested __________________
Yes No
d (1) Were any participants in the pension benefit plan separated from service with a deferred vested _________
benefit for which a Schedule SSA (Form 5500) is required to be attached?............................... 7d(1)
----------
(2) If "Yes," enter the number of separated participants required to be reported
- ------------------------------------------------------------------------------------------------------------------------
8a Was this plan ever amended since its effective date? If "Yes," complete line 8b and, if the amendment was
adopted in this plan year, complete lines 8c through 8e..................................................... 8a
b If line 8a is "Yes," enter the date the most recent amendment was adopted Month ____ Day ____ Year ____ ________
c Did any amendment during the current plan year result in the retroactive reduction of accrued benefits for
any participant? 8c
d During this plan year, did any amendment change the information contained in the latest summary plan _________
description or summary description of modifications available at the time of amendment?.................... 8d
e If line 8d is "Yes," has a summary plan description or summary description of modifications that reflect __________
the plan amendments referred to on line 8d been both furnished to participants and filed with the
Department of Labor?....................................................................................... 8e
- -------------------------------------------------------------------------------------------------------------------------
9a Was this plan terminated during this plan year or any prior plan year? If "Yes," enter year _______________ 9a X
---------
b Were all plan assets either distributed to participants or beneficiaries, transferred to another plan, or
brought under the control of PBGC?......................................................................... 9b
---------
c Was a resolution to terminate this plan adopted during this plan year or any prior plan year?.............. 9c
d If line 9a or line 9c is "Yes," have you received a favorable determination letter from the IRS for the ---------
termination?............................................................................................... 9d
---------
e If line 9d is "No," has a determination letter been requested from the IRS?................................ 9e
f If line 9a or line 9c is "yes," have participants and beneficiaries been notified of the termination or ---------
the proposed termination?.................................................................................. 9f
g If line 9a is "Yes" and the plan is covered by PBGC, is the plan continuing to file a PBGC Form 1 and pay --------
premiums until the end of the plan year in which assets are distributed or brought under the control of
PBGC?...................................................................................................... 9g
---------
h During this plan year, did any trust assets revert to the employer for which the Code section 4980 excise
tax is due?................................................................................................ 9h
---------
i If line 9h is "Yes," enter the amount of tax paid with Form 5330 $
- -------------------------------------------------------------------------------------------------------------------------
10a Was this plan merged or consolidated into another plan(s), or were assets or liabilities transferred to
another plan(s) since the end of the plan year covered by the last return/report Form 5500 or 5500-C
which was filed for this plan (or during this plan year if this is the first return/report)? If "Yes,"
complete lines 10b through 10e............................................................................ 10a
If "YES," identify the other plan(s): ----------------
c Employer identification number(s) d Plan number(s)
b Name of plan(s)
--------------------------------------- ------------------------------------ ----------------
------------------------------------------------------ ------------------------------------ -----------------
e If required, has a Form 5310-A been filed?...................................................... [_] Yes [_] No
- -------------------------------------------------------------------------------------------------------------------------
11 Enter the plan funding arrangement code 12 Enter the plan benefit arrangement code from Yes No
from page 14 of the instructions page 14 of the instructions
- -------------------------------------------------------------------------------------------------------------------------
13 Is this a plan established or maintained pursuant to one or more collective bargaining agreements?......... 13
14 If any benefits are provided by an insurance company, insurance service, or similar organization, enter -----------
the number of Schedules A (Form 5500), Insurance Information, that are attached. If none, enter -0-.
- -------------------------------------------------------------------------------------------------------------------------
/TABLE
<PAGE>
<PAGE>
<TABLE>
<S>
<C> <C> <C> <C>
Form 5500 C/R (1995) Complete page 1, and pages 3 through 6 only, if you are filing Form 5500-C. Page 4
- -------------------------------------------------------------------------------------------------------------------------
Welfare Plans Do Not Complete Lines 15 Through 25. Skip To Line 26 on page 5.
- -------------------------------------------------------------------------------------------------------------------------
15a If this is a defined benefit plan subject to the minimum funding standards for this plan year, Yes No
-------------------
is Schedule B (Form 5500) required to be attached? (If this is a defined contribution plan,
leave blank.) (See instructions.) ........................................................... 15a
-------------------
If "Yes," attach Schedule B (Form 5500).
b If this is a defined contribution plan (i.e., money purchase or target benefit), is it subject
to the minimum funding standards (if a waiver was granted, see instructions)? (If this is a
defined benefit plan, leave blank.)........................................................... 15b
--------------------
If "Yes," complete (1), (2), and (3) below:
(1) Amount of employer contribution required for the plan year under Code
section 412 15b(1) $
---------------------------------
(2) Amount of contribution paid by the employer for the plan year........ 15b(2) $
---------------------------------
Enter date of last payment by employer Month_____ Day_____ Year_____
(3) If (1) is greater than (2), subtract (2) from (1) and enter the funding
deficiency here. Otherwise, enter -0-. (If you have a funding
deficiency, file Form 5330.)......................................... 15b(3) $
- ------------------------------------------------------------------------------------------------------------------------
16 Has the annual compensation of each participant taken into account under the current plan year
been limited as required by section 401(a)(17)? (See instructions.).......................... 16
- -------------------------------------------------------------------------------------------------------------------------
17a (1) Did the plan distribute any annuity contracts this year? (See instructions.)............ 17a(1)
-------------------
(2) If (1) is "Yes," did these contracts contain a requirement that the spouse consent before
any distributions under the contract are made in a form other than a qualified joint and
survivor annuity?........................................................................ 17a(2)
-------------------
b Did the plan make distributions or loans to married participants and beneficiaries without the
required consent of the participant's spouse?................................................. 17b
-------------------
c Upon plan amendment or termination, do the accrued benefits of every participant include the
subsidized benefits that the participant may become entitled to receive subsequent to the
plan amendment or termination?................................................................ 17c
- -------------------------------------------------------------------------------------------------------------------------
18 Is the plan administrator making an election under section 412(c)(8) for an amendment adopted
after the end of the plan year? (See instructions.).......................................... 18
-------------------
19 If a change in the actuarial funding method was made for the plan year pursuant to a Revenue
Procedure providing automatic approval for the change, indicate whether the plan sponsor agrees
to the change................................................................................. 19
-------------------
20 Have any contributions been made or benefits accrued in excess of the Code section 415 limits,
as amended?................................................................................... 20
-------------------
21 Check if you are applying either of the following in completing lines 21a through 21o (see
instructions):
(i) [_] Reasonable, good-faith interpretation of the nondiscrimination provisions
(ii) [_] Substantiation guidelines
If you checked box 21(ii), enter the first day of the plan year for
which data is being submitted Month_____ Day_____ Year_____
a Does the employer apply the separate line of business rules of Code section 414(r) when
testing this plan for the coverage and discrimination tests requirements of Code sections
410(b) and 401(a)(4)?......................................................................... 21a X
-------------------
b If line 21a is "Yes," enter the total number of separate lines of business claimed by the
employer_________
if more than one separate line of business, see instructions for additional information to attach.
c Does the employer apply the mandatory disaggregation rules under Income Tax Regulations section
1.410(b)-7(c)? If "Yes," see instructions for additional information to attach............... 21c X
-------------------
d In testing whether this plan satisfies the coverage and discrimination tests of Code sections
410(b) and 401(a), does the employer aggregate plans?......................................... 21d X
-------------------
e Does the employer restructure the plan into component plans to satisfy the coverage and
discrimination tests of Code sections 410(b) and 401(a)(4)?................................... 21e X
-------------------
f If you meet either one of the following exceptions, check the applicable box to tell us which
exception you meet and DO NOT complete the rest of question 21:
(1) [_] No highly compensated employee benefited under the plan at any time during the plan year;
(2) [_] This is a collectively bargained plan that benefits only collectively bargained employees,
no more than 2% of whom are professional employees.
g Did any leased employee perform services for the employer at any time during the plan year?... 21g X
-------------------
Number
-------------------
h Enter the total number of employees of the employer. Employer includes entities aggregated with
the employer under Code section 414(b), (c), or (m). Include leased employees and self-employed
individuals................................................................................... 21h 108
-------------------
i Enter the total number of employees excludable under the plan because of: (1) failure to meet
requirements for minimum age and years of service; (2) collectively bargained employees;
(3) nonresident aliens who receive no earned income from U. S. sources; and (4) 500 hours
of service/last day rule...................................................................... 21i 36
-------------------
- -------------------------------------------------------------------------------------------------------------------------
/TABLE
<PAGE>
<PAGE>
<TABLE>
<S> <C> <C>
Form 5500-C/R(1995) Complete page 1, and pages 3 through 6 only, if you are filing Form 5500-C. Page 5
- -------------------------------------------------------------------------------------------------------------------------
Number
---------------
j Enter the number of nonexcludable employees. Subtract line 21i from line 21h. . . . . . . . . . . . 21j 72
---------------
k Do 100% of the nonexcludable employees entered on line 21j benefit under the plan? . . . [X] Yes [_] No
If line 21k is "Yes," DO NOT complete lines 21l through 21o.
l Enter the number of nonexcludable employees (line 21j) who are highly compensated employees. . . . . 21l
---------------
m Enter the number of nonexcludable employees who benefit under the plan . . . . . . . . . . . . . . . 21m
---------------
n Enter the number of employees entered on line 21m who are highly compensated employees . . . . . . . 21n
---------------
o This plan satisfies the coverage requirements on the basis of (check one):
(1) [_] The average benefits test (2) [_] The ratio percentage test-enter percentage[_][_][_][.][__]%
- -------------------------------------------------------------------------------------------------------------------------
Yes No
---------------
22a Is it or was it ever intended that this plan qualify under Code section 401(a)?
If "Yes", complete lines 22b and 22c . . 22a
---------------
b Enter the date of the most recent IRS determination letter . . . . . . . . . . Month_______ Year______
---------------
c Is a determination letter request pending with the IRS? . . . . . . . . . . . . . . . . . . . . . . . 22c
- -------------------------------------------------------------------------------------------------------------------------
23a Does the plan hold any assets that have a fair market value that is not readily determinable on an
established market? (If "Yes", complete line 23b.) (See instructions) . . . . . . . . . . . . . . . 23a
---------------
b Were all the assets referred to on line 23a valued for the 1995 plan year by an
independent third-party appraiser? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23b
---------------
c If line 23b is "No," enter the value of the assets that were not valued by an independent
third-party appraiser for the 1995 plan year . . . . . . . . . . . . . . . . . . . . . . . 23c
----------
d Enter the most recent date the assets on line 23c were valued by an independent third-party appraiser.
(If more than one asset, see instructions.) Month________ Day________ Year______
(If this plan has NO ESOP features, leave line 23e blank and go to line 24.)
e If dividends paid on employer securities held by the ESOP were used to make payments
on ESOP loans, enter the amount of the dividends used to make the payments. . . . . . . . . 23e
------------
- -------------------------------------------------------------------------------------------------------------------------
24 Does the employer/sponsor listed in 1a of this form maintain other qualified pension benefit plans? . 24
If "Yes," enter the total number of plans, including this plan -------------
- -------------------------------------------------------------------------------------------------------------------------
25a Is the plan covered under the Pension Benefit Guaranty Corporation termination insurance
program? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [_] Yes [_] No [_] Not determined
b If line 25a is "Yes" or "Not determined," enter the EIN and the plan number used to identify it.
EIN Plan number
- -------------------------------------------------------------------------------------------------------------------------
26 You may NOT use N/A in response to any line 26 item. If you check "Yes," you must enter a dollar Yes No Amount
amount in the amount column. -----------------
During this plan year:
a Was this plan covered by a fidelity bond? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26a
---------------
b If line 26a is "Yes," enter the name of the surety company _______________________________________ --------------
c Was there any loss to the plan, whether or not reimbursed, caused by fraud or dishonesty? . . . . . 26c
---------------
d Was there any sale, exchange, or lease of any property between the plan to the employer, any
fiduciary, any of the five most highly paid employees of the employer, any owner of a 10% or
more interest in the employer, or relatives of any such persons? . . . . . . . . . . . . . . . . . 26d
---------------
e Was there any loan or extension of credit by the plan to the employer, any fiduciary, any of the
five most highly paid employees of the employer, any owner of a 10% or more interest in the employer,
or relatives of any such persons? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26e
---------------
f Did the plan acquire or hold any employer security or employer real property? . . . . . . . . . . . 26f
---------------
g Has the plan granted an extension on any delinquent loan owed to the plan? . . . . . . . . . . . . 26g
---------------
h Were any participant contributions transmitted to the plan more than 31 days after receipt or
withholding by the employer? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26h
---------------
i Were any loans by the plan or fixed income obligations due the plan classified as uncollectible
or in default as of the close of the plan year? . . . . . . . . . . . . . . . . . . . . . . . . . . 26i
---------------
j Has any plan fiduciary had a financial interest in excess of 10% in any party providing services
to the plan or received anything of value from any such party? . . . . . . . . . . . . . . . . . . 26j
---------------
k Did the plan at any time hold 20% or more of its assets in any single security, debt, mortgage,
parcel or real estate, or partnership/joint venture interests? . . . . . . . . . . . . . . . . . . 26k
---------------
l Did the plan at any time engage in any transaction or series of related transactions involving 20%
or more of the current value of plan assets? . . . . . . . . . . . . . . . . . . . . . . . . . . . 26l
---------------
m Were there any noncash contributions made to the plan whose value was set without an appraisal by
an independent third party? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26m
--------------
n Were there any purchases of nonpublicly traded securities by the plan whose value was set without
an appraisal by an independent third party? . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26n
---------------
o Has the plan reduced or failed to provide any benefit when due under the terms of the plan because
of insufficient assets? . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26o
---------------
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
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<PAGE>
<TABLE>
<S> <C> <C> <C>
Form 5500 C-R(1995) Complete page 1, and pages 3 through 6 only, if you are filing Form 5500-C Page 6
- -------------------------------------------------------------------------------------------------------------------------
27 Current value of plan assets and liabilities at the beginning and end of the plan year. Combine the value of plan
assets held in more than one trust. Allocate the value of the plan's interest in a commingled trust containing the assets
of more than one plan on a line-by-line basis unless the trust meets one of the specific exception described in the
instructions. Do not enter the value of the portion of an insurance contract that guarantees during this plan year to pay
a specific dollar benefit at a future date. Round off amounts to the nearest dollar. Any other amounts are subject to
rejection. Plans with no assets at the beginning and end of the plan year enter -0- on line 27f.
- -------------------------------------------------------------------------------------------------------------------------
(a) Beginning (b) End of
Assets of year year
----------------------------
a Cash ............................................................................... 27a
----------------------------
b Receivables ........................................................................ 27b
----------------------------
c Investments:
(1) U.S. Government securities .................................................... 27c(1)
----------------------------
(2) Corporate debt and equity instruments ......................................... 27c(2)
----------------------------
(3) Real estate and mortgages (other than to participants) ........................ 27c(3)
----------------------------
(4) Loans to participants:
A Mortgages .................................................................. (4)A
----------------------------
B Other ...................................................................... (4)B
----------------------------
(5) Other ......................................................................... 27c(5)
----------------------------
(6) Total investments. Add lines 27c(1) through 27c(5) ............................ 27c(6)
----------------------------
d Buildings and other property used in plan operations ............................... 27d
----------------------------
e Other assets ....................................................................... 27e
----------------------------
f Total assets. Add lines 27a, 27b, 27c(6), 27d, and 27e ............................. 27f
----------------------------
Liabilities
g Payables ........................................................................... 27g
----------------------------
h Acquisition indebtedness ........................................................... 27h
----------------------------
i Other liabilities .................................................................. 27i
----------------------------
j Total liabilities. Add lines 27g through 27i ....................................... 27j
----------------------------
k Net assets. Subtract line 27j from line 27f ........................................ 27k
- -------------------------------------------------------------------------------------------------------------------------
28 Plan income, expenses, and changes in net assets for the plan year. Include all income and expenses of the plan
including any trust(s) or separately maintained fund(s) and any payments/receipts to/from insurance carriers. Round off
amounts to the nearest dollar. Any other amounts are subject to rejection.
Income (a) Amount (b) Total
----------------------------
a Contributions received or receivable in cash from:
(1) Employer(s) (including contributions on behalf of self-employed individuals) .. 28a(1)
----------------------------
(2) Employees ..................................................................... 28a(2)
----------------------------
(3) Others ........................................................................ 28a(3)
----------------------------
(4) Add lines 28a(1) through 28a(3) ............................................... 28a(4)
----------------------------
b Noncash contributions. Enter the total of lines 28a(4) and lines 28b in column (b) . 28b
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c Earnings from investments (interest, dividends, rents, royalties) ................. 28c
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d Net realized gain (loss) on sale or exchange of assets ............................. 28d
----------------------------
e Other income (specify) ............................................................. 28e
----------------------------
f Total income. Add lines 28b through 28e ............................................ 28f
----------------------------
Expenses
g Distribution of benefits and payments to provide benefits:
(1) Directly to participants or their beneficiaries ............................... 28g(1)
----------------------------
(2) Other ......................................................................... 28g(2)
----------------------------
(3) Total distribution of benefits and payments to provide benefits ............... 28g(3)
----------------------------
h Administrative expenses (salaries, fees, commissions, insurance premiums) .......... 28h
----------------------------
i Other expenses (specify) ........................................................... 28i
----------------------------
j Total expenses. Add lines 28g through 28i .......................................... 28j
----------------------------
k Net income (loss). Subtract line 28j from line 28f ................................. 28k
- -------------------------------------------------------------------------------------------------------------------------
</TABLE>
