<PAGE> 1
As filed with the Securities and Exchange Commission on March 31, 1998
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE
SECURITIES ACT OF 1933
V.F. CORPORATION
(Exact Name of Registrant as Specified in Charter)
<TABLE>
<S> <C>
PENNSYLVANIA 23-1180120
(State or Other Jurisdiction (I.R.S. Employer Identification Number)
of Incorporation or Organization)
</TABLE>
1047 NORTH PARK ROAD
WYOMISSING, PENNSYLVANIA 19610
(Address of Registrant's Principal Executive Offices)
V.F. CORPORATION TAX-ADVANTAGED
SAVINGS PLAN FOR HOURLY EMPLOYEES
(Full Title of the Plan)
CANDACE S. CUMMINGS, ESQ.
VICE PRESIDENT - ADMINISTRATION, GENERAL COUNSEL AND SECRETARY
V.F. CORPORATION
P.O. BOX 1022
READING, PENNSYLVANIA 19603
(Name and address of agent for service)
(610) 378-1151
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF SHARES TO BE AMOUNT TO BE OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
REGISTERED REGISTERED (1) PER SHARE (2) PRICE (2) REGISTRATION FEE
<S> <C> <C> <C> <C>
Common Stock 100,000 $51.96875 $5,196,875.00 $1,533.08
(no par value; stated capital
$1.00 per share)
</TABLE>
(1) In addition, pursuant to Rule 416 under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of: (a)
interests to be offered or sold pursuant to the employee benefit plan
described herein, and (b) additional shares which may be necessary to
adjust the number of shares reserved for issuance pursuant to the
Tax-Advantaged Savings Plan for Hourly Employees for any future stock
split, stock dividend or similar adjustment of the outstanding Common Stock
of the registrant.
<PAGE> 2
(2) Estimated pursuant to Rule 457(c) solely for the purpose of calculating the
registration fee.
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PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents which have been filed by V.F. Corporation
("registrant" or the "Company") with the Securities and Exchange Commission (the
"Commission") are incorporated by reference into this Registration Statement:
(a) the Company's Annual Report on Form 10-K for the year ended January
3, 1998;
(b) the description of the Common Stock, no par value per share (the
"Common Stock"), of the Company contained in the Company's Registration
Statement on Form 8-A dated April 27, 1965 filed pursuant to section 12(g)
of the Securities Exchange Act of 1934, as amended (the "1934 Act") and the
Company's Registration Statements on Form 8-A dated May 8, 1987 and January
23, 1998 filed pursuant to section 12(b) of the 1934 Act, which contain
descriptions of the Common Stock of the Company and certain rights relating
to the Common Stock, and any amendment or reports filed for the purpose of
updating such descriptions.
All documents filed by the Company or the Company's Tax-Advantaged
Savings Plan for Hourly Employees (the "Plan") pursuant to sections 13(a),
13(c), 14 and 15(d) of the 1934 Act after the date hereof and prior to the
filing of a post-effective amendment which indicates that all securities offered
pursuant to this Registration Statement have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference herein and to be a part hereof from the date of filing of such
documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Legal matters with respect to the Common Stock being offered hereby
have been passed upon for the Company by Pepper Hamilton LLP, Philadelphia,
Pennsylvania. M. Rust Sharp, of counsel to Pepper Hamilton LLP, is a director of
the Company. Mr. Sharp owns beneficially 22,923,288 shares of Common Stock as a
co-trustee under certain Deeds of Trust dated August 21, 1951 and under the Will
of John E. Barbey, deceased. Mr. Sharp has no pecuniary interest in the shares
owned by the trusts. Additionally, Mr. Sharp owns 2,000 shares of Common Stock
and options to purchase 28,200 shares of Common Stock.
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ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 1741 of the Pennsylvania Business Corporation Law, as amended
(the "BCL"), provides that a business corporation shall have the power to
indemnify any person who was or is a party or is threatened to be made a party
to any threatened, pending or completed action, suit or proceeding, whether
civil, criminal, administrative or investigative (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 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. Section 1742 of the BCL provides that in
the case of actions by or in the right of the corporation, a corporation may
indemnify any such persons only against expenses (including attorneys' fees)
actually and reasonably incurred in connection with the defense or settlement of
such action and only if such person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
corporation, provided that no such indemnification is permitted in respect to
any claim, issue or matter as to which such person is adjudged liable for
negligence or misconduct in the performance of his duty to the corporation,
except to the extent that a court determines that indemnification is proper
under the circumstances. The BCL further provides under Section 1743 that to the
extent that such person has been successful on the merits or otherwise in
defending any action (even one on behalf of the corporation), he is entitled to
indemnification for expenses (including attorneys' fees) actually and reasonably
incurred in connection with such action. The By-Laws of the Company provide for
indemnification of the officers or directors of the Company to the fullest
extent permissible under the BCL.
The indemnification provided for under the BCL is not exclusive of any
other rights of indemnification. Under Section 1746 of the BCL a corporation may
maintain insurance on behalf of any of the persons referred to above against
liability asserted against any of them and incurred in or arising out of any
capacity referred to above, whether or not the corporation would have the power
to indemnify against such liabilities under the BCL. Section 518 of the
Pennsylvania Associations Code ("Section 518") provides that a Pennsylvania
corporation shall have the power, by action of the shareholders, directors or
otherwise, to indemnify a person as to action in his official capacity and as to
action in another capacity while holding that office for any action taken or any
failure to take any action, whether or not the corporation would have the power
to indemnify the person under any other provision of law (including Section 1741
and 1742 of the BCL), except as provided in Section 518, and whether or not the
indemnified liability arises or arose from any threatened, pending or completed
action by or in the right of the corporation. Indemnification is not authorized
pursuant to Section 518 in any case where the act or failure to act giving rise
to the claim for indemnification is determined by a court to have constituted
willful misconduct or recklessness. In addition to the power to advance expenses
under the BCL, Section 518 provides that expenses incurred by an officer,
director, employee or agent in defending a civil or criminal action, suit or
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<PAGE> 5
proceeding may be paid by the corporation in advance of the final disposition of
such action, suit or proceeding upon receipt of an undertaking by or on behalf
of such person to repay such amount if it shall ultimately be determined that he
is not entitled to be indemnified by the corporation. Section 518 permits a
business corporation to create a fund, under the control of a trustee or
otherwise, to secure or insure in any manner its indemnification obligations
whether arising under or pursuant to Section 518 or otherwise. The Company's
By-Laws provide that any person made a party to any lawsuit by reason of being a
director or officer of the Company may be indemnified by the Company, to the
fullest extent permitted by Pennsylvania law, against the reasonable expenses,
including attorneys' fees, incurred by the director or officer in connection
with the defense of such lawsuit. The By-Laws further provide that a director of
the Company shall not be personally liable for monetary damages arising from any
action taken or any failure to act by the director unless (a) the director has
breached or failed to perform the duties of a director under Section 512 of the
Pennsylvania Associations Code or as such law may be amended from time to time
and (b) the breach of duty constituted self-dealing, willful misconduct or
recklessness. The limitation on a director's personal liability for monetary
damages does not apply to a director's criminal liability or liability for
taxes.
The Company maintains directors' and officers' liability insurance for
expenses for which indemnification is permitted by Pennsylvania Business
Corporation Law and Section 518. These insurance policies insure the Company
against amounts which it may become obligated to pay as indemnification to
directors and officers and insures its directors and officers against losses
(except fines, penalties and other matters uninsurable under law) arising from
any claim made against them on account of any alleged "wrongful act" in their
official capacity. A wrongful act is defined as "any breach of any duty,
neglect, error, misstatement, misleading statement, omission or other act done
or wrongfully attempted by the directors and officers or . . . so alleged by any
claimant on any matter claimed against them solely by reason of their being such
directors or officers," subject to certain exclusions. Directors and officers
are also insured against losses (except fines, penalties and other matters
uninsurable under law) arising out of the insured's breach of fiduciary duty,
subject to certain exclusions.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
Exhibit No. Description
----------- -----------
4 V.F. Corporation Tax-Advantaged Savings Plan for Hourly
Employees
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Coopers & Lybrand L.L.P.
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<PAGE> 6
24 Power of Attorney
In accordance with Item 8 of Form S-8, this registration statement does
not include Exhibit 5 -- Opinion regarding Legality, as:
1. The Company undertakes to submit the Plan and any amendment thereto
to the Internal Revenue Service in a timely manner and will make all changes
required by the Internal Revenue Service in order to qualify the Plan under
Section 401(a) and 401(k) of the Internal Revenue Code.
2. The Plan provides that shares of the Company's Common Stock issued
under the Plan will be purchased by the Trustee of the Plan on the open market.
The Plan does not provide for such shares to be issued by the Company out of its
authorized and unissued shares of Common Stock.
ITEM 9. UNDERTAKINGS
The undersigned registrant hereby undertakes as follows:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this registration statement (or the most recent
post-effective amendment thereof) which, individually or in aggregate, represent
a fundamental change in the information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than 20 percent change in the
maximum aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement; and
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement;
provided, however, that paragraphs (1)(i) and (1)(ii) above do not
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
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<PAGE> 7
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
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 each filing of the annual report of the Plan 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.
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.
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<PAGE> 8
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized in the Borough of Wyomissing, Commonwealth of Pennsylvania on the
30th day of March, 1998.
V.F. CORPORATION
By:/s/ Mackey J. McDonald
Mackey J. McDonald
President and
Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities and on the
dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
/s/ Mackey J. McDonald President and March 30, 1998
----------------------
Mackey J. McDonald Chief Executive Officer
/s/ Gerard G. Johnson Vice President - Finance March 30, 1998
---------------------- and Chief Financial Officer
Gerard G. Johnson
/s/ Robert K. Shearer Vice President - Controller March 30, 1998
--------------------------
Robert K. Shearer
DIRECTORS
---------
Robert D. Buzzell* George Fellows* William E. Pike*
Edward E. Crutchfield* Leon C. Holt, Jr.* Lawrence R. Pugh*
Ursula F. Fairbairn* Robert J. Hurst* M. Rust Sharp*
Barbara S. Feigin* Mackey J. McDonald* L. Dudley Walker*
</TABLE>
* By: /s/ Candace S. Cummings
---------------------------------
Candace S. Cummings, Attorney-In-Fact
Date: March 30, 1998
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<PAGE> 9
EXHIBIT INDEX
4 V.F. Corporation Tax-Advantaged Savings Plan For Hourly Employees
23.1 Consent of Coopers & Lybrand L.L.P.
23.2 Consent of Coopers & Lybrand L.L.P.
24 Power of Attorney
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EXHIBIT 4
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN
FOR HOURLY EMPLOYEES
Effective April 1, 1998
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<PAGE> 2
Table of Contents
<TABLE>
<CAPTION>
Page
<S> <C>
ARTICLE I - DEFINITIONS.................................................................. 1
A. Account................................................................ 1
B. Administrator.......................................................... 1
C. Beneficiary............................................................ 1
D. Code................................................................... 1
E. Committee.............................................................. 1
F. Company................................................................ 1
G. Compensation........................................................... 1
H. Determination Year..................................................... 2
I. Effective Date......................................................... 2
J. Eligible Employee...................................................... 2
K. Eligible Spouse........................................................ 3
L. Employee............................................................... 3
M. Employer............................................................... 3
N. Employer Minimum Contribution.......................................... 4
O. Employer Minimum Contribution Account.................................. 4
P. Entry Date............................................................. 4
Q. ERISA.................................................................. 4
R. Financial Hardship..................................................... 4
S. Highly Compensated Employee............................................ 5
T. Hour of Service........................................................ 5
U. Key Employee........................................................... 6
V. Leased Employee........................................................ 6
W. Non-Highly Compensated Employee........................................ 7
X. Non-Key Employee....................................................... 7
Y. Normal Retirement...................................................... 7
Z. Normal Retirement Age.................................................. 7
AA. Normal Retirement Date................................................. 7
BB. One-Year Break in Service.............................................. 8
CC. Participant............................................................ 8
DD. Plan................................................................... 8
EE. Plan Year.............................................................. 8
FF. Rollover Account....................................................... 8
GG. Salary Deferral Account................................................ 8
HH. Salary Deferral Contribution........................................... 8
II. Salary Deferral Election............................................... 8
JJ. Spousal Consent........................................................ 8
KK. Top-Heavy Plan......................................................... 9
LL. Total Compensation..................................................... 10
MM. Trust.................................................................. 12
</TABLE>
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<TABLE>
<S> <C>
NN. Trustee................................................................ 12
OO. Year of Service........................................................ 12
ARTICLE II - ELIGIBILITY AND PARTICIPATION............................................... 12
A. Service Requirement.................................................... 12
B. Eligibility Computation Period......................................... 12
C. Salary Deferral Election............................................... 13
D. Participation.......................................................... 13
E. Leaves of Absence...................................................... 13
F. Suspended Participation................................................ 13
ARTICLE III - EMPLOYER CONTRIBUTIONS..................................................... 14
A. Definitions............................................................ 14
B. Salary Deferral Contribution........................................... 15
C. Limitations on Salary Deferral Contributions........................... 16
D. Correcting Excess Deferrals and Excess Contributions................... 16
E. Employer Minimum Contribution.......................................... 20
F. Maximum Contribution................................................... 21
ARTICLE IV - ALLOCATIONS TO PARTICIPANTS' ACCOUNTS....................................... 21
A. Accounts............................................................... 21
B. Valuation of Accounts.................................................. 21
C. Allocation of Employer Minimum Contributions........................... 22
D. Allocation of Salary Deferral Contributions............................ 22
E. Allocation Limitations................................................. 22
F. Transfers from Other Plans............................................. 27
ARTICLE V - VESTING OF EMPLOYER CONTRIBUTIONS............................................ 28
A. Vesting................................................................ 28
ARTICLE VI - DISTRIBUTION OF BENEFITS.................................................... 28
A. Methods of Distribution................................................ 28
B. Time of Distribution to Participant.................................... 29
C. Time of Distribution to Beneficiary.................................... 31
D. Small Account Balances................................................. 31
E. Nonliability........................................................... 31
F. Distributions Prior to Termination of Employment....................... 32
G. Withdrawals on Account of Financial Hardship........................... 33
H. Direct Rollover of Eligible Rollover Distributions..................... 34
I. Loans to Participants.................................................. 35
ARTICLE VII - BENEFICIARIES.............................................................. 38
A. Designation............................................................ 38
B. Absence of Valid Designation of Beneficiaries.......................... 38
</TABLE>
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<PAGE> 4
<TABLE>
<S> <C>
ARTICLE VIII - ESTABLISHMENT OF TRUST; DIRECTED INVESTMENTS.............................. 39
A. Trust Agreement........................................................ 39
B. Trust Agreement Part of Plan........................................... 39
C. Participant-Directed Investments....................................... 39
D. Directions to Committee................................................ 40
E. Duty to Evaluate Investments........................................... 41
F. Costs of Investments................................................... 41
G. Rules of Committee..................................................... 41
ARTICLE IX - PLAN FIDUCIARIES AND ADMINISTRATION......................................... 41
A. Named Fiduciaries...................................................... 41
B. Fiduciary Standard..................................................... 42
C. Multiple Duties and Advisors........................................... 42
D. Allocation and Delegation of Fiduciary Duties.......................... 42
E. Indemnification........................................................ 42
F. Costs and Expenses..................................................... 43
G. Authority to Amend and Terminate....................................... 43
H. Committee.............................................................. 43
I. Plan Administration.................................................... 43
J. Claims Procedures...................................................... 44
K. Agent for Legal Process................................................ 46
L. Voting and Tender of Company Stock..................................... 46
ARTICLE X - AMENDMENT AND TERMINATION.................................................... 48
A. Amendment.............................................................. 48
B. Termination or Complete Discontinuance of Contributions................ 48
C. Nonreversion........................................................... 48
ARTICLE XI - MISCELLANEOUS............................................................... 49
A. Limitation of Rights; Employment Relationship.......................... 49
B. Transfer of Assets of Employer; Transfer of Assets of Plan............. 50
C. Spendthrift Provision.................................................. 50
D. Applicable Law; Severability........................................... 51
APPENDIX A - Employees' Savings Plan of Bassett-Walker, Inc. Merger...................... A-1
</TABLE>
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<PAGE> 5
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN
FOR HOURLY EMPLOYEES
Effective as of April 1, 1998, VF Corporation hereby adopts the VF
Corporation Tax-Advantaged Savings Plan for Hourly Employees (the "Plan") and
establishes a Trust Agreement under the Plan to provide retirement entitlements
for the exclusive benefit of its Eligible Employees and their Beneficiaries in
accordance with the terms and conditions set forth in the Plan.
The Plan and Trust are intended to meet the requirements for
qualification under Section 401(a) and Section 401(k) and exemption from tax
under Section 501(a) of the Internal Revenue Code of 1986, as amended.
ARTICLE I
DEFINITIONS
A. "Account" shall mean the aggregate of the following accounts of the
Participant, as established in the books and records of the Plan:
1. Salary Deferral Account;
2. Rollover Account; and
3. Employer Minimum Contribution Account.
B. "Administrator" shall mean the Plan Administrator as specified in
Article IX.
C. "Beneficiary" shall mean the person or persons (natural or
otherwise) designated by or for a Participant, entitled under this Plan to
receive benefits after the death of a Participant.
D. "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
E. "Committee" shall mean the VF Corporation Pension Committee,
appointed and acting in accordance with Article IX of this Plan.
F. "Company" shall mean VF Corporation, a Pennsylvania corporation.
G. "Compensation" shall mean all compensation for the Plan Year (or
such other applicable period specifically designated in the Plan) paid or
payable in cash or in kind by the Employer for personal services. However,
Compensation shall not include any amounts paid or payable by reason of services
performed (i) after the date an Employee ceases to be a Participant, and (ii)
prior to the date an Employee becomes a Participant. Compensation shall not
include, with
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<PAGE> 6
respect to any Employee, in any Plan Year (or such other applicable period
specifically designated in the Plan), any compensation in excess of $160,000 (or
such other amount established by the Secretary of the Treasury in accordance
with Section 401(a)(17) of the Code). In addition, Compensation shall not
include any amounts contributed by an Employer (except elective and salary
deferral contributions pursuant to a cash or deferred arrangement), for or on
account of its Employees, under this Plan or under any other employee benefit
plan qualified under the provisions of Section 401(a) of the Code. For purposes
of the Highly Compensated Employee definition, "Compensation" shall mean Total
Compensation as defined in this Article I including elective and salary
reduction contributions made to a cafeteria plan or cash or deferred
arrangement.
H. "Determination Year" shall mean the Plan Year that is being tested.
I. "Effective Date" shall mean April 1, 1998.
J. "Eligible Employee" shall mean any Employee, except the following
persons:
1. A person who is compensated on a salaried or a sales
commission basis;
2. A person who is assigned to regular service outside the
United States, unless carried on a United States payroll;
3. A person whose Compensation and conditions of employment
are subject to determination by collective bargaining, unless the
collective bargaining agreement provides to the contrary, in which case
such person shall be eligible to participate upon the terms and
conditions provided herein;
4. A person who is a nonresident alien and who receives no
earned income (within the meaning of Section 911(d) of the Code) from
an Employer, such earned income constituting income from sources within
the United States (within the meaning of Section 861(a)(3) of the
Code); or
5. A person employed at an Employer location or in a job
classification specified from time to time by the Committee as
ineligible to participate in the Plan.
Notwithstanding anything to the contrary in the Plan, no person who is
classified by the Employer as an independent contractor, or otherwise as other
than an employee, shall be considered an Eligible Employee for purposes of this
Plan, regardless of whether such person is a common law employee of the
Employer.
Notwithstanding anything to the contrary in the Plan, no person who is
a Leased Employee within the meaning of Section 414(n) or 414(o) of the Code
shall be considered an Eligible Employee for purposes of this Plan.
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<PAGE> 7
K. "Eligible Spouse" shall mean the spouse to whom a Participant is
married on either the date distribution of his Plan benefits commences or the
date of his death, whichever occurs earlier. To the extent provided under a
"qualified domestic relations order" as described in Section 414(p) of the Code,
the term Eligible Spouse shall mean a former spouse in addition to or in place
of the Participant's current spouse.
L. "Employee" shall mean a person currently employed by the Employer,
any portion of whose income is subject to withholding of income tax and/or for
whom Social Security or railroad retirement contributions are made by the
Employer. "Employee" shall also include any Leased Employee deemed to be an
Employee as provided in Section 414(n) or 414(o) of the Code. For purposes of
the Highly Compensated Employee and Non-Highly Compensated Employee definitions,
"Employee" shall mean any individual who performs services for the Employer
(other than a nonresident alien who received no earned income as defined under
Section 911(d)(2) of the Code from his Employer that constituted income from
sources within the United States as defined in Code Section 861(a)(3)) and is
either a common-law employee or a self-employed individual as defined in Section
401(c)(1) of the Code; "Employee" also shall include a Leased Employee unless
such individual is not covered under this Plan and is covered under a
safe-harbor money purchase pension plan.
M. "Employer" shall mean the Company and any other corporation or other
business entity which has adopted or hereafter adopts the Plan with the approval
of the Company. In addition, for purposes of determining an Employee's Hours of
Service, the term "Employer" includes:
1. Any corporation or trade or business which is or was a
member of a controlled group of corporations, a group of businesses
under common control or an affiliated service group (within the meaning
of Section 414(b), (c), (m), and (o) of the Code, respectively) of
which an Employer adopting the Plan is a member, but only for such
period as the corporation or trade or business and the adopting
Employer are or were considered members of the group;
2. Any corporation or trade or business which is a predecessor
employer, if this Plan is a successor plan to the predecessor
employer's qualified plan; and
3. Any corporation or trade or business which has been
acquired directly or indirectly by the Company, provided that such
corporation or trade or business shall be treated as an Employer under
this Plan only during such Plan Years as are designated by the Board of
Directors of the Company, and only with respect to those persons
employed by such corporation or trade or business on the date it was
acquired by the Company.
For purposes of the Highly Compensated Employee and Non-Highly Compensated
Employee definitions, an "Employer" shall mean the corporation or other business
entity which has adopted this Plan; "Employer" also shall include any
corporation or trade or business which is or was a member of a controlled group
of corporations, a group of businesses under common control, or an
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<PAGE> 8
affiliated service group (within the meaning of Sections 414(b), (c), and (m) of
the Code, respectively) of which the entity identified in the preceding sentence
is a member.
N. "Employer Minimum Contribution" shall mean the contribution, if any,
made to the Plan by the Employer pursuant to Paragraph E of Article III.
O. "Employer Minimum Contribution Account" shall mean the account
maintained for each Participant in the books and records of the Plan for the
purpose of recording Employer Minimum Contributions allocated to the
Participant, as adjusted for earnings and losses allocated thereto.
P. "Entry Date" shall mean the date upon which an Eligible Employee
becomes a Participant, which shall be the Effective Date or the first day of any
month.
Q. "ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
R. "Financial Hardship" shall mean the existence of a Participant's
immediate and heavy financial need. A need shall exist if it is necessary for:
1. The payment of medical expenses described in Section 213(d)
of the Code incurred by the Participant, his spouse or dependents, or
enabling such persons to obtain such medical care;
2. The payment of tuition and related educational fees for the
next twelve months of post-secondary education for the Participant, his
spouse, children, or dependents;
3. The purchase (excluding mortgage payments) of a
Participant's principal residence;
4. Payments necessary to prevent eviction of the Participant
from his principal residence or foreclosure on his principal residence;
or
5. Other expenses which the Commissioner of the Internal
Revenue Service indicates will be deemed to be made on account of such
need.
In addition, any Participant may apply in writing to the Committee to determine
that an expense of the Participant constitutes an immediate and heavy financial
need. The Committee shall make such determination on the basis of objective
criteria adopted by the Committee and applied on a nondiscriminatory basis.
S. "Highly Compensated Employee" shall mean any Employee who, during
the Determination Year, performed services for the Employer and (i) was a five
percent (5%) owner within the meaning of Section 416(i)(1)(B)(i) of the Code and
the regulations thereunder at any time during the Determination Year or the
preceding year, or (ii) for the preceding year received
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<PAGE> 9
more than $80,000 in Compensation (indexed at the same time and in the same
manner as the dollar limit in Section 415(d) of the Code is indexed).
T. "Hour of Service" shall mean each hour for which an Employee is:
1. Directly or indirectly paid or entitled to payment by the Employer
for the performance of duties;
2. Directly or indirectly paid or entitled to payment by the Employer
on account of a period of time during which no duties were 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 authorized under Paragraph E of Article
II. However, no more than 501 Hours of Service shall be credited under this
subparagraph 2 on account of any single continuous period during which the
Employee performs no duties (whether or not such period occurs in a single
computation period). Payments made or due under a plan maintained by the
Employer solely to comply with applicable workers' compensation, unemployment
compensation, or disability insurance law, or to reimburse an Employee for
medical or medically-related expenses shall not be considered as payments by the
Employer for purposes of this subparagraph.
3. Absent from work by reason of the pregnancy of the Employee, the
birth of a child of the Employee, the placement of a child with the Employee in
connection with the adoption of the child by the Employee, or the care of such
child by the Employee for a period immediately following birth or placement. No
more than 501 Hours of Service shall be credited under this subparagraph 3 by
reason of any one pregnancy or placement. Hours of Service credited under this
subparagraph 3 shall be credited solely for purposes of determining whether a
One-Year Break in Service has occurred in a computation period. All Hours of
Service credited under this subparagraph 3 shall be credited only in the
computation period in which the absence from work begins if any of such Hours of
Service are required in that computation period to avoid a One-Year Break in
Service. If none of the Hours of Service credited under this subparagraph 3 are
required to avoid a One-Year Break in Service in the computation period in which
the absence begins, then the Hours of Service will be credited to the next
computation period. An Employee will be credited with 8 Hours of Service for
each day of absence covered by this subparagraph. Credit shall be given pursuant
to this subparagraph 3 only after the Employee furnishes to the Administrator
such timely information as the Administrator may reasonably require to establish
that the absence is for a reason described in this subparagraph; or
4. Either awarded back pay or for which the Employer agrees to pay such
back pay, irrespective of mitigation of damages. An Hour of Service received
under this subparagraph 4 shall be credited to that computation period for which
the award was granted. The same Hours of Service shall not be credited both
under either subparagraph 1 or 2, as the case may be, and under this
subparagraph 4. Hours of Service for which back pay is awarded or agreed to with
respect to periods described in subparagraph 2 shall be subject to the
limitations set forth in that paragraph.
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<PAGE> 10
Hours of Service shall be calculated and credited in accordance with
Department of Labor Regulation Section 2530.200b-2(b) and (c), which is
incorporated herein by this reference.
U. "Key Employee" shall mean an Employee or former Employee and their
Beneficiaries who, within the meaning of Section 416(i) of the Code and the
regulations thereunder, is or at any time during the four preceding Plan Years
has been:
1. An officer of the Employer whose annual compensation
exceeds 50% of the amount in effect under Section 415(b)(1)(A) of the
Code for any such Plan Year;
2. One of the ten Employees whose annual compensation from the
Employer exceeds the limitation in effect under Section 415(c)(1)(A)
and who owns or is considered as owning more than a one-half percent
(1/2%) ownership interest and one of the ten largest percentage
ownership interests in the Employer;
3. A five percent (5%) owner of the Employer; or
4. A one percent (1%) owner of the Employer having an annual
compensation of more than $150,000.
For purposes of this definition, no more than fifty employees (or, if
less than fifty, either three employees or ten percent of all employees,
whichever is greater) shall be treated as officers. In addition, for purposes of
determining ownership percentages hereunder, the constructive ownership rules of
Section 318 of the Code shall apply as provided by Section 416(i)(1)(B) of the
Code. For purposes of subparagraph 2, if two Employees have the same interest in
the Employer, the Employee having greater annual compensation from the Employer
shall be treated as having a larger interest. For purposes of determining the
number of officers taken into account under subparagraph U-1 above, employees
described in Section 414(q)(5) of the Code shall be excluded. For purposes of
determining compensation, Total Compensation shall be used in addition to
elective and salary-reduction contributions made to any 401(k) plan of the
Employer, a simplified employee pension plan, a cafeteria plan, and a
tax-sheltered annuity.
V. "Leased Employee" shall mean a person (other than an Employee) who
has performed services (i) of a type historically performed for the Employer by
employees in the Employer's field of business, (ii) on a substantially full-time
basis for a period of at least one (1) year, (iii) either directly or indirectly
for the Employer (or for the Employer and related persons determined in
accordance with Section 414(n)(6) of the Code), and (iv) pursuant to a written
or oral agreement between the Employer and any other person. For purposes of
this Plan, Leased Employees shall be treated as follows:
1. Contributions and benefits to the Leased Employee by the
person who has entered into the agreement with the Employer, which are
attributable to services for the Employer, shall be treated as provided
by Employer.
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<PAGE> 11
2. Service provided by the individual who becomes a Leased
Employee to the person who has entered into the agreement with the
Employer, which are attributable to services performed for the
Employer, shall be treated as provided under this Plan.
The term "Leased Employee" shall include a person described above who is covered
by a qualified money purchase pension plan of the other person who has entered
into the agreement with the Employer which provides (i) a nonintegrated employer
contribution rate of at least ten percent (10%) of compensation as defined in
Section 415(c)(3) of the Code including amounts contributed pursuant to a salary
reduction agreement which are excludable from his gross income under Sections
125, 402(a)(8), 402(h), and 403(b) of the Code, (ii) immediate participation,
and (iii) immediate and full vesting.
W. "Non-Highly Compensated Employee" shall mean any Employee who is not
a Highly Compensated Employee.
X. "Non-Key Employee" shall mean any Employee who is not a Key
Employee.
Y. "Normal Retirement" shall mean retirement on or after the
Participant's Normal Retirement Age. In the case of a Participant who continues
in the employ of the Employer after reaching such Normal Retirement Age, "Normal
Retirement" shall mean retirement on the delayed retirement date, which is the
date of the Participant's actual termination of employment. A Participant who
attains Normal Retirement Age and who retires on his Normal Retirement Date
shall be entitled to receive distributions in accordance with Article VI. A
Participant who continues in the employ of the Employer after reaching Normal
Retirement Age shall continue to participate in the Plan and to have
contributions allocated to his Account. When such Participant subsequently
retires, he shall then be entitled to have the balance standing in his Account
under the Plan distributed at such retirement date and in the same manner as if
he had retired at his Normal Retirement Date.
Z. "Normal Retirement Age" shall mean age sixty-five (65).
AA. "Normal Retirement Date" shall mean the first day of the month
coinciding with or next following a Participant's attainment of Normal
Retirement Age.
BB. "One-Year Break in Service" shall mean, with respect to any
Employee, a computation period during which the Employee is credited with 500 or
fewer Hours of Service. Except as provided in Paragraph B of Article II, the
Plan Year shall be the computation period.
CC. "Participant" shall mean any Eligible Employee who has become a
participant of this Plan, in accordance with Article II of this Plan.
DD. "Plan" shall mean the VF Corporation Tax-Advantaged Savings Plan
for Hourly Employees, as set forth herein, and any amendments hereto.
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<PAGE> 12
EE. "Plan Year" shall mean the twelve (12) month period ending December
31st, except that the first Plan Year shall commence on April 1, 1998 and end on
December 31, 1998.
FF. "Rollover Account" shall mean the account established for an
Eligible Employee in the books and records of the Plan for the purpose of
recording any funds transferred to the Trustee from, or attributable to, another
qualified plan or an individual retirement account pursuant to Paragraph F of
Article IV, as adjusted for earnings and losses allocated thereto.
GG. "Salary Deferral Account" shall mean the account maintained for
each Participant in the books and records of the Plan for the purpose of
recording any Salary Deferral Contributions allocated to the Participant, as
adjusted for earnings and losses allocated thereto.
HH. "Salary Deferral Contribution" shall mean the contribution, if any,
made to the Plan by the Employer pursuant to Paragraph B of Article III.
II. "Salary Deferral Election" shall mean an election made by an
Eligible Employee to defer a specified percentage of his Compensation for the
Plan Year pursuant to Paragraph B of Article III.
JJ. "Spousal Consent" shall mean an Eligible Spouse's written consent
which acknowledges the effect of the Participant's election and is witnessed by
a Plan representative or a notary public. Spousal Consent may be in the form of
a specific consent, general consent or limited general consent:
1. A "specific consent" shall specify the nonspouse
Beneficiary, if any.
2. A "general consent" shall allow the Participant, without
further Spousal Consent, to change the Beneficiary designation if such
general consent indicates that the Eligible Spouse has the right to
limit her consent to a specific Beneficiary and that such spouse
voluntarily elects to relinquish such right.
3. A "limited general consent" shall allow the Participant,
without further Spousal Consent, to change the Beneficiary designation
to any person or persons (natural or otherwise) among those set forth
in writing.
Once made, a general consent shall be irrevocable. A specific or limited general
consent shall be irrevocable unless the Participant changes his Beneficiary
designation; upon such event, a specific consent and a limited general consent
(if the Participant's subsequent Beneficiary designation is not among those
options expressly set forth in the limited general consent) shall be deemed to
be revoked. Notwithstanding the foregoing, Spousal Consent is not required if
the Participant establishes to the satisfaction of a Plan representative that
such written consent may not be obtained because there is no Eligible Spouse or
that the Eligible Spouse cannot be located. In addition, no Spousal Consent is
necessary if the Participant has been legally separated or abandoned within the
meaning of local law and the Participant provides the Plan representative with a
court order to that effect, so long as such court order does not conflict with a
qualified domestic relations order. If the
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<PAGE> 13
Eligible Spouse is legally incompetent to consent, the Eligible Spouse's legal
guardian may consent on her behalf, even if the legal guardian is the
Participant. If the Eligible Spouse has consented to the designation of a trust
as the Participant's Beneficiary, Spousal Consent is not required for the
designation of or change in trust beneficiaries.
KK. "Top-Heavy Plan" shall mean (1) a plan in which, as of the
"determination date," the aggregate of "accounts" of Key Employees exceeds sixty
percent (60%) of the aggregate of "accounts" of all employees under the plan;
and (2) each plan which is included in an "aggregation group" if such group is a
top-heavy group, as determined under Section 416(g)(2) of the Code. For purposes
of this Paragraph: (a) "determination date" means the last day of the
immediately preceding Plan Year or, in the case of the first Plan Year, the last
day of such year. Where two or more plans are aggregated, the plans will be
aggregated by adding together the results for each plan as of the determination
dates for such plans which fall in the same calendar year; (b) "accounts" means
the sum of all accounts maintained for the employee determined as of the most
recent valuation date occurring within the twelve-month period ending on the
determination date (or, in the case of a defined benefit plan, the present value
of the cumulative accrued benefits determined as of the valuation date used for
computing plan costs for minimum funding purposes), including distributions made
with respect to such employee under the plan during the five (5) year period
ending on the "determination date," but excluding, however, rollover
contributions, the account of a Non-Key Employee who was formerly a Key
Employee, the account of an individual who has not performed services for the
Employer at any time during the five (5) year period ending on the determination
date, and further excluding those amounts attributable to deductible employee
contributions (as defined in Section 72(o)(5)(A) of the Code); and (c)
"aggregation group" means (i) each plan of the Employer in which a Key Employee
participates, and each other plan of the Employer which enables a plan in which
a Key Employee participates to meet the requirements of Section 401(a)(4) or
Section 410 of the Code (including a terminated plan maintained within the last
five (5) year period ending on the "determination date"), and (ii) any other
plan maintained by the Employer which the Company elects to include within the
group, provided the resulting group satisfies Section 401(a)(4) and Section 410
of the Code. In determining the cumulative accrued benefits of a defined benefit
plan for purposes of this Paragraph, the actuarial assumptions specified by the
defined benefit plan for this purpose shall be utilized. If differing actuarial
assumptions are specified for two or more defined benefit plans, then the
actuarial assumptions for the defined benefit plan including the largest number
of employees in the first year any defined benefit plan is included within the
aggregation group shall be utilized. Solely for the purpose of determining if
the Plan, or any other plan in a required aggregation group of which this Plan
is a part, is a Top-Heavy Plan, the accrued benefit of an Employee other than a
Key Employee shall be determined (a) under the method, if any, that uniformly
applies for accrual purposes under all plans maintained by the Employer, or (b)
if there is no such method, as if such benefit accrued not more rapidly than the
slowest accrual rate permitted under the fractional accrual rate of Section
411(b)(1)(C) of the Code.
LL. "Total Compensation" shall mean all amounts paid or made available
to an Employee which are treated as compensation under Treasury Regulation
Section 1.415-2(d)(2), and are not excluded from compensation under Treasury
Regulation Section 1.415-2(d)(3).
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<PAGE> 14
1. Items Includable as Compensation. For purposes of applying
the limitations of Section 415 of the Code, the term "compensation"
includes:
(a) The Participant's wages, salaries, fees for
professional services and other amounts received for personal
services actually rendered in the course of employment with an
Employer maintaining the Plan (including, but not limited to,
commissions paid to salesmen, compensation for services on the
basis of a percentage of profits, commissions on insurance
premiums, tips, bonuses, fringe benefits, and reimbursements
or other expense allowances under a nonaccountable plan (as
described in Treasury Regulation Section 1.62-2(c))).
(b) In the case of a Participant who is an employee
within the meaning of Section 401(c)(1) of the Code and the
regulations thereunder, the Participant's earned income (as
described in Section 401(c)(2) of the Code and the regulations
thereunder).
(c) For purposes of subsections (a) and (b) of this
subparagraph, earned income from sources outside the United
States (as defined in Section 911(b) of the Code, whether or
not excludable from gross income under Section 911 of the
Code).
(d) Amounts described in Sections 104(a)(3), 105(a)
and 105(h) of the Code, but only to the extent that these
amounts are includable in the gross income of the employee.
(e) Amounts paid or reimbursed by the Employer for
moving expenses incurred by an employee, but only to the
extent that at the time of the payment it is reasonable to
believe that these amounts are not deductible by the employee
under Section 217 of the Code.
(f) The value of a non-qualified stock option granted
to an employee by the Employer, but only to the extent that
the value of the option is includable in the gross income of
the employee for the taxable year in which granted.
(g) The amount includable in the gross income of an
employee upon making the election described in Section 83(b)
of the Code.
(h) Elective and salary reduction contributions made
to a cafeteria plan or cash or deferred arrangement.
2. Items Not Includable as Compensation. The term
"compensation" does not include items such as:
(a) Subject to subparagraph LL-1(h) above,
contributions made by the Employer to a plan of deferred compensation
to the extent that, before the application of the
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<PAGE> 15
Code Section 415 limitations to that plan, the contributions are not
includable in the gross income of the employee for the taxable year in
which contributed. Additionally, any distributions from a plan of
deferred compensation are not considered as compensation for Code
Section 415 purposes, regardless of whether such amounts are includable
in the gross income of the employee when distributed. However, any
amount received by an employee pursuant to an unfunded non-qualified
plan is permitted to be considered as compensation for Code Section 415
purposes in the year such amounts are includable in the gross income of
the employee.
(b) Amounts realized from the exercise of a
non-qualified stock option, or when restricted stock (or property) held
by an employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture under Section 83 of the
Code and the regulations thereunder.
(c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option.
(d) Other amounts which receive special tax benefits,
such as premiums for group term life insurance (but only to the extent
that the premiums are not includable in the gross income of the
employee), or contributions made by an Employer (whether or not under a
salary reduction agreement) toward the purchase of an annuity contract
described in Section 403(b) of the Code (whether or not the
contributions are excludable from the gross income of the employee).
Except as otherwise provided in this Plan, Total Compensation shall be
determined on the basis of the Plan Year.
MM. "Trust" shall mean the trust established pursuant to Article VIII
of this Plan.
NN. "Trustee" shall mean the trustee or trustees of the Trust
established pursuant to this Plan.
OO. "Year of Service" shall mean a computation period during which an
Employee is credited with not less than 1,000 Hours of Service with the
Employer. Except as provided in Paragraph B of Article II, the Plan Year shall
be the computation period.
ARTICLE II
ELIGIBILITY AND PARTICIPATION
An Eligible Employee shall become a Participant of the Plan in
accordance with the following requirements:
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<PAGE> 16
A. Service Requirement
1. Each Employee who is an Eligible Employee on February 28,
1998 shall be eligible to become a Participant of the Plan as of the
Effective Date. Each Employee who is not an Eligible Employee on
February 28, 1998 shall, following completion of one (1) Year of
Service, be eligible to become a Participant of the Plan as of the
Entry Date coincident with or next following completion of the Year of
Service.
2. An Eligible Employee who satisfies the service requirements
of subparagraph 1 but who is not an Eligible Employee on the Entry Date shall
become a Participant of the Plan immediately upon again becoming an Eligible
Employee.
B. Eligibility Computation Period
For purposes of Article II, the initial Eligibility Computation Period
shall be the twelve (12) consecutive month period commencing with the date on
which an Employee first performs an Hour of Service for the Employer. Subsequent
Eligibility Computation Periods will be the Plan Year, commencing with the Plan
Year which includes the first anniversary of the date the Employee first
performs an Hour of Service.
C. Salary Deferral Election
An Employee who is eligible to become a Salary Deferral Participant
under Paragraph A of this Article II shall become a Salary Deferral Participant
as of the Entry Date coincident with or next following the date he makes a
written application to become a Salary Deferral Participant and signs a form
providing a Salary Deferral Election. The Employer shall to the extent possible
notify each Eligible Employee of his prospective eligibility to become a Salary
Deferral Participant at least thirty (30) days prior to the date he must file an
application, but such notice shall be given only the first time an Employee is
eligible to become a Salary Deferral Participant, and failure to give such
notice shall not impose any liability upon the Employer or the Committee.
D. Participation
Participation in the Plan continues until a Participant terminates by
Normal Retirement, by delayed retirement, or by death or severs employment with
the Employer (including by reason of disability in accordance with subparagraph
B-7 of Article VI). An Employee whose participation in the Plan has terminated
shall become a Participant again on the date he again becomes an Eligible
Employee. An Employee whose participation in the Plan has terminated but who has
not received all benefits under the Plan shall be a "former Participant."
E. Leaves of Absence
A Participant's employment shall not be deemed to have terminated while
he is a member of the Armed Forces of the United States, provided that he
returns to the employment of the Employer within ninety (90) days (or such
longer period as may be prescribed by law) from the
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<PAGE> 17
date he first became entitled to his discharge. Participants who do not return
to the employ of the Employer within the required time in case of service with
the Armed Forces, shall be deemed to have terminated their employment as of the
date when their leaves of absence began, unless such failure to return was the
result of Normal Retirement, delayed retirement or death.
F. Suspended Participation
A Participant who ceases to be an Eligible Employee, but who has not
separated from the service of the Employer, shall become a suspended
Participant. During the period of suspension, no amounts which are based on his
Compensation or Total Compensation from and after the date of suspension shall
be credited to his Account. However, the Participant shall be entitled to
benefits in accordance with the other provisions of the Plan while he is a
suspended Participant.
ARTICLE III
EMPLOYER CONTRIBUTIONS
A. Definitions
For purposes of this Article III, the following definitions shall apply
unless indicated otherwise:
1. "Actual Deferral Percentage" shall mean the ratio
(expressed as a percentage to the nearest one-hundredth of one percent)
of the Elective Deferrals made on behalf of an Eligible Participant for
the Plan Year to the Eligible Participant's Compensation (determined
without regard to the limitation on amounts paid or payable by reason
of services performed after the date an Employee ceases to be an
Eligible Participant and prior to the date an Employee becomes an
Eligible Participant) for the Plan Year. The Actual Deferral Percentage
of an Eligible Participant who makes no Elective Deferrals shall be
zero (0).
2. "Average Actual Deferral Percentage" shall mean the average
(expressed as a percentage to the nearest one-hundredth of one percent)
of the Actual Deferral Percentages of the Eligible Participants in a
group.
3. "Elective Deferrals" shall mean Salary Deferral
Contributions and any other contributions made by the Employer to this
Plan and any other qualified plans that are maintained by the Employer
which are aggregated with this Plan under subparagraph D-6 of this
Article III for the Plan Year at the election of the Eligible
Participant, in lieu of cash compensation (that either would have been
received by the Eligible Participant in the Plan Year or is
attributable to services performed by the Eligible Participant within
the Plan Year and would have been received by the Eligible Participant
within 2 1/2 months after the close of the Plan Year but for a deferral
election), and shall include contributions made pursuant to a salary
reduction agreement. Such "Elective Deferrals" shall be taken into
account for a Plan Year only if they are allocated to the Eligible
Participant's account as of
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<PAGE> 18
a date within that Plan Year, the allocation is not contingent on the
Eligible Participant's participation in the plan or performance of
services for the Employer after such date, and the Elective Deferrals
are paid to a trust no later than twelve (12) months after the close of
the Plan Year to which they relate.
4. "Eligible Participant" for purposes of Paragraphs C and D
of this Article III shall mean any Employee who is otherwise authorized
under this Plan and any other qualified plans that are maintained by
the Employer which are aggregated with this Plan under subparagraph D-6
of this Article III to have Elective Deferrals allocated to his account
for the Plan Year.
5. "Excess Deferral Amount" shall mean the amount of Excess
Deferrals for a calendar year which the Participant allocates to this
Plan pursuant to the procedure set forth in subparagraph D-1 of this
Article III.
B. Salary Deferral Contribution
1. A Participant electing to participate in the Plan shall
make a Salary Deferral Election for the Plan Year electing to defer any
whole percentage from 2% to 10% of his Compensation. In no event shall
such deferral exceed $10,000 in a taxable year (as adjusted by the
Secretary of the Treasury at the same time and in the same manner as
under Section 415(d) of the Code, except rounded to the next lowest
multiple of $500).
2. A Participant, by filing a written election form with the
Committee at least ten (10) days prior to the first day of the month
for which the election is to become effective, may change his Salary
Deferral Election once each month, to become effective the first day of
the month following the receipt of the election form by the Committee.
A Participant, by filing a written election with the Committee, may
elect to suspend Salary Deferral Contributions. The suspension will
become effective as soon as administratively possible, but no later
than the first day of the calendar month following thirty (30) days
after receipt of the election by the Committee. A Participant who
suspends all Salary Deferral Contributions will not be permitted to
resume Salary Deferral Contributions for the remainder of the calendar
quarter in which contributions were suspended.
3. Subject to the provisions of Paragraphs C and D of this
Article III, for each Plan Year the Employer shall make a Salary
Deferral Contribution to the Plan for each Participant in an amount
equal to the amount of Compensation which the Participant has elected
to defer pursuant to his Salary Deferral Election. The Employer shall
pay over all Salary Deferral Contributions to the Trustee on the
earliest date on which such contributions can reasonably be segregated
from the Employer's general assets, but in any event, no later than the
15th business day of the month following the month in which such
amounts would otherwise have been payable to the Employee in cash.
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<PAGE> 19
4. All Salary Deferral Elections, changes in Salary Deferral
Elections or suspensions of Salary Deferral Elections shall be made in
writing on such forms and in such manner as may be established by the
Committee.
5. No other Employer provided benefit shall be directly or
indirectly conditioned upon any Employee's election to make a Salary
Deferral Election under this Article III.
C. Limitations on Salary Deferral Contributions
The following limitations shall apply to Salary Deferral Contributions:
1. No Participant shall receive a Salary Deferral Contribution
under this Plan which, when combined with any other Elective Deferrals
of the Participant under any other qualified plan in which the
Participant participates for the calendar year, exceeds $10,000 (as
adjusted by the Secretary of the Treasury at the same time and in the
same manner as under Section 415(d) of the Code, except rounded to the
next lowest multiple of $500).
2. The Average Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees for the Plan Year
shall not exceed the Average Actual Deferral Percentage for Eligible
Participants who are Non-Highly Compensated Employees for the preceding
Plan Year multiplied by 1.25; or
3. The Average Actual Deferral Percentage for Eligible
Participants who are Highly Compensated Employees for the Plan Year
shall not exceed the Average Actual Deferral Percentage for Eligible
Participants who are Non-Highly Compensated Employees for the preceding
Plan Year multiplied by two (2), provided that the Average Actual
Deferral Percentage for Eligible Participants who are Highly
Compensated Employees does not exceed the Average Actual Deferral
Percentage for Eligible Participants who are Non-Highly Compensated
Employees for the preceding Plan Year by more than two (2) percentage
points.
4. For purposes of applying subparagraphs C-2 and C-3 above
for the Plan's first Plan Year, the amount taken into account as the
Average Actual Deferral Percentage for Eligible Participants who are
Non-Highly Compensated Employees shall be three percent (3%).
D. Correcting Excess Deferrals and Excess Contributions
1. Notwithstanding any other provision of the Plan:
(a) Excess Deferral Amounts and income allocable
thereto shall be distributed to Participants who claim such
Excess Deferral Amounts for the preceding calendar year no
later than the April 15 following the calendar year in which
such Excess Deferral Amounts are contributed to the Plan. A
Participant's
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<PAGE> 20
claim pursuant to this subparagraph D-1(a) shall be in
writing; shall be submitted to the Committee no later than
March 1; shall specify the Participant's Excess Deferral
Amount from the preceding calendar year; and shall be
accompanied by the Participant's written statement that if
such amounts are not distributed, such Excess Deferral Amount,
when added to amounts deferred under other plans or
arrangements described in Section 401(k), 408(k) or 403(b) of
the Code, exceeds the limit imposed on the Participant by
Section 402(g) of the Code for the year in which the deferral
occurred.
(b) The Excess Deferral Amount distributed to a
Participant with respect to a calendar year shall be adjusted
for income or loss. The income or loss attributable to the
Excess Deferral Amount shall include a pro rata share of
income or loss in the Plan Year in which the Excess Deferral
Amount was made (the "Contribution Year Income") and a pro
rata share of income or loss for the period between the end of
the Plan Year in which the Excess Deferral Amount was made and
the date of distribution under subparagraph D-1(a) of this
Article III (the "Distribution Year Income").
(i) The Contribution Year Income shall be
determined by multiplying the income or loss for the
Plan Year allocable to the Participant's Elective
Deferrals by a fraction the numerator of which is the
Excess Deferral Amount of the Participant for the
Plan Year and the denominator of which is the total
balance of the Participant's account attributable to
Elective Deferrals, without adjustment for gain or
loss during the Plan Year.
(ii) The Distribution Year Income shall be
determined by multiplying ten percent (10%) of the
Contribution Year Income by the number of calendar
months which have elapsed since the end of the Plan
Year in which the Excess Deferral Amount was made.
For purposes of determining the number of calendar
months that have elapsed since the end of the Plan
Year in which the Excess Deferral Amount was made, a
distribution occurring in the first fifteen days of a
calendar month will be deemed made on the last day of
the preceding month. A distribution occurring after
the fifteenth day of a calendar month will be deemed
made on the first day of the next succeeding calendar
month.
2. In the event that the limitations imposed by subparagraphs C-2 and
C-3 of this Article III are not satisfied for any Plan Year, the Plan and any
other qualified plans that are maintained by the Employer which are aggregated
with this Plan shall take the following remedial measure under this subparagraph
D-2 no later than the last day of each Plan Year for Eligible Participants to
whose accounts such Excess Contributions were allocated for the preceding Plan
Year.
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(a) The Employer shall determine the Excess Contributions
under subparagraph D-3 below and distribute such Excess Contributions,
with income or loss attributable thereto under subparagraph D-4 below,
no later than 2 1/2 months following the last day of the Plan Year for
which the Excess Contributions were made to Eligible Participants to
whose accounts Excess Contributions were allocated for the preceding
Plan Year. Amounts distributed shall be distributed from the Eligible
Participant's Salary Deferral Account.
Any distribution under this subparagraph D-2 may be made without any
notice or consent otherwise required under Article VI. In addition,
such distribution shall not be considered a distribution for purposes
of determining whether the Plan and any other qualified plans that are
maintained by the Employer which are aggregated with this Plan satisfy
the minimum distribution requirements of subparagraph B-6 of Article
VI.
3. Excess Contributions shall be determined as follows:
(a) The Employer shall rank its Eligible Participants
who are Highly Compensated Employees by amount of Salary
Deferral Contribution in descending order. The Employer shall
then reduce the amount of Elective Deferrals made on behalf of
the Highly Compensated Employee with the highest Salary
Deferral Contribution until the first of the following occurs:
(i) The Plan and any other qualified plans
that are maintained by the Employer which are
aggregated with this Plan satisfy the limitations set
forth in subparagraphs C-2 and C-3 of this Article
III; or
(ii) The Salary Deferral Contribution for
such Highly Compensated Employee is reduced to an
amount which equals the Salary Deferral Contribution
of the Highly Compensated Employee with the next
highest Salary Deferral Contribution. The Employer
shall then repeat the application of this
subparagraph D-3(a) until the Plan and any other
qualified plans that are maintained by the Employer
which are aggregated with this Plan satisfy the
limitations set forth in subparagaphs C-2 and C-3 of
this Article III.
(b) For each Eligible Participant who is a Highly
Compensated Employee, "Excess Contributions" shall mean the
difference between:
(i) The sum of the Elective Deferrals
allocated to the Highly Compensated Employee for such
Plan Year (determined prior to the application of
this subparagraph D-3); and
(ii) The amount determined by multiplying
the Highly Compensated Employee's Actual Deferral
Percentage (determined after application of this
subparagraph D-3) by his Compensation.
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Notwithstanding the foregoing, in no event shall
Excess Contributions exceed the amount of Elective
Deferrals made on behalf of such Highly Compensated
Employee for such Plan Year.
4. The income or loss attributable to Excess Contributions
shall include a pro rata share of income or loss in the Plan Year in which the
Excess Contributions were made (the "Contribution Year Income") and a pro rata
share of income or loss for the period between the end of the Plan Year in which
the Excess Contributions were made and the date of distribution under
subparagraph D-2 of this Article III (the "Distribution Year Income").
(a) The Contribution Year Income shall be determined
by multiplying the income or loss for the Plan Year allocable
to Elective Deferrals by a fraction the numerator of which is
the Excess Contributions of the Eligible Participant for the
Plan Year and the denominator of which is the total balance of
the Eligible Participant's account attributable to Elective
Deferrals without adjustment for gain or loss during the Plan
Year.
(b) The Distribution Year Income shall be determined
by multiplying ten percent (10%) of the Contribution Year
Income by the number of calendar months which have elapsed
since the end of the Plan Year in which the Excess
Contributions were made. For purposes of determining the
number of calendar months that have elapsed since the end of
the Plan Year in which the Excess Contributions were made, a
distribution occurring in the first fifteen days of a calendar
month will be deemed made on the last day of the preceding
month. A distribution occurring after the fifteenth day of a
calendar month will be deemed made on the first day of the
next succeeding calendar month.
5. The Excess Contributions shall be reduced, in accordance with
regulations prescribed by the Secretary of the Treasury, by the amount of Excess
Deferrals previously distributed to the Eligible Participant under subparagraph
D-1 of this Article III for his taxable year ending with or within such Plan
Year.
6. For purposes of this Paragraph D:
(a) The Actual Deferral Percentage for any Eligible
Participant who is a Highly Compensated Employee for the Plan Year and
who is eligible to have Elective Deferrals allocated to his account
under two or more arrangements described in Section 401(k) of the Code
that are maintained by the Employer shall be determined as if all such
Elective Deferrals were made under a single arrangement, provided that
no such arrangement is part of a plan that is an employee stock
ownership plan of the Employer as defined in Section 4975(e) of the
Code. If any such plan is an employee stock ownership plan, the Actual
Deferral Percentage shall be determined separately for all employee
stock ownership plans and all non-employee stock ownership plans. If
such an Eligible Participant participates in two or more plans or
arrangements that have different plan years, all such plans or
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<PAGE> 23
arrangements ending with or within the same calendar year shall be
treated as a single plan or arrangement.
(b) If the Employer maintains this Plan in addition to one or
more qualified plans which contain a cash or deferred arrangement, such
plans shall be treated as follows. In the event that this Plan
satisfies the requirements of Section 401 (a)(4) or 410(b) of the Code
only if aggregated with one or more other plans, or if one or more
other plans satisfy the requirements of Section 401 (a)(4) or 410(b) of
the Code only if aggregated with this Plan, then subparagraphs C-2 and
C-3 of this Article III shall be applied by determining the Actual
Deferral Percentage of Eligible Participants as if all such plans were
a single plan. This Plan may be aggregated with any other qualified
plan maintained by the Employer to determine whether the Actual
Deferral Percentage of Eligible Participants satisfies the requirements
of subparagraphs C-2 and C-3 of this Article III, provided that the
aggregated plans are treated as one plan for purposes of Sections 401
(a)(4), 401(k), and 410(b) of the Code. Notwithstanding the foregoing,
the plans so aggregated must have a plan year that is the same as the
Plan Year and no plan so aggregated may be an employee stock ownership
plan (as defined in Section 4975(e) of the Code).
(c) The determination and treatment of the Actual Deferral
Percentage of any Eligible Participant shall satisfy such other
requirements as may be prescribed by the Secretary of the Treasury.
E. Employer Minimum Contribution
1. Notwithstanding anything in this Plan to the contrary, and
subject to the limitations set forth in subparagraphs 2 and 3 below, in
any Plan Year in which the Plan is a Top-Heavy Plan, the Employer shall
contribute an amount so as to provide allocations for each Non-Key
Employee Participant who is employed on the last day of the Plan Year
(including such Non-Key Employee Participant who has not accrued a Year
of Service for the Plan Year) of Employer contributions under this Plan
which, together with any other contributions allocated to the Non-Key
Employee Participant under any other defined contribution plans
maintained by the Employer, equals three percent (3%) of the
Participant's Total Compensation (excluding Total Compensation in
excess of $160,000, as adjusted by the Secretary of the Treasury in
accordance with Section 401(a)(17) of the Code).
2. The percentage minimum contribution required under
subparagraph E-1 above shall in no event exceed the percentage at which
contributions are made (or required to be made) under the Plan for the
Plan Year for the Key Employee for whom such percentage is the highest
for the Plan Year. In determining the highest rate of contribution
applicable to a Key Employee, amounts elected to be deferred under a
qualified Section 401(k) arrangement shall be counted for purposes of
Section 416 of the Code.
3. No minimum contribution will be required for a Participant
under this Plan for any Plan Year if the Company maintains another
qualified plan under which a minimum
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<PAGE> 24
benefit or contribution is being accrued or made for such Participant
in accordance with Section 416(c) of the Code.
4. Notwithstanding any provision of this Paragraph E to the
contrary, in any Plan Year in which this Plan is a Top-Heavy Plan, each
Non-Key Employee Participant who is also covered by a defined benefit
plan of the Employer, shall accrue a minimum benefit equal to the
minimum benefit provided by the defined benefit plan. No minimum
Employer contribution shall be credited under this Plan.
F. Maximum Contribution
Employer contributions to the Plan shall not exceed the amount
which the Employer estimates will be deductible under Section 404(a)(3), or, if
applicable, Section 404(a)(7) of the Code, or any successor or similar statutory
provision hereafter enacted.
ARTICLE IV
ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
A. Accounts
For purposes of allocating Employer contributions made
pursuant to Article III, the Committee shall establish and maintain, where
appropriate, separate accounts for each Participant, including a Salary Deferral
Account and an Employer Minimum Contribution Account. Since these individual
accounts are maintained only for accounting purposes, a segregation of the Trust
assets within each account is not required.
B. Valuation of Accounts
1. Within a reasonable period of time after the end of each
month and within a reasonable period of time after the removal or
resignation of the Trustee, the Trustee shall determine the fair market
value of the assets of the Trust as of the close of the month (or the
close of the shorter period ending with such resignation or removal).
Further, if an Employee's participation in the Plan ceases for any
reason, the Committee shall direct the Trustee to determine the fair
market value of the Trust as of the date specified by the Committee,
provided that the Committee, in its sole discretion, acting in a
non-discriminatory manner determines there has been a significant
change in the value of Trust assets. The date of such valuation shall
be deemed a valuation date. As of any valuation date, and before
allocating Employer contributions, the Committee shall allocate the
increment of Trust earnings for each of the respective investment
vehicles available under Paragraph C of Article VI to (or, as the case
may be, charge the losses against) the respective Accounts of the
Participants in proportion to the balances of such Accounts invested in
the respective investment vehicles as of the most recent valuation
date.
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<PAGE> 25
2. If a Participant, former Participant or Beneficiary becomes
entitled to a benefit pursuant to Article VI, the value of the Account
available to be distributed shall be determined as of the last day of
the month in which the Participant or Beneficiary, as applicable, files
a written request for payment of benefits with the Committee, provided
such written request is filed on or before the 28th day of the month
(or such other deadline as shall be specified by the Committee).
C. Allocation of Employer Minimum Contributions
In any Plan Year in which the Plan is a Top-Heavy Plan,
Employer Minimum Contributions, if any, shall be allocated to the Employer
Minimum Contribution Accounts of Participants in amounts specified in Paragraph
E of Article III.
D. Allocation of Salary Deferral Contributions
Salary Deferral Contributions shall be allocated to the Salary Deferral
Accounts of Participants in amounts equal to the Salary Deferral Contribution
contributed on their behalf pursuant to Paragraph B of Article III.
E. Allocation Limitations
1. Notwithstanding anything to the contrary contained in this
Plan, the Annual Additions to a Participant's Account for any Plan Year
shall not exceed the lesser of the Defined Contribution Dollar
Limitation for the Plan Year or twenty-five percent (25%) of the
Participant's Total Compensation for the Plan Year. The percentage
limitation of the preceding sentence shall not apply to any
contribution for medical benefits (within the meaning of Section
419A(f)(2) of the Code) after separation from service which is
otherwise treated as an Annual Addition, or to any amount otherwise
treated as an Annual Addition under Section 415(l)(2) of the Code. For
purposes of this Paragraph E, the term:
(a) "Annual Additions" means for any Plan Year the
sum of the following amounts credited to a Participant's
accounts in all qualified defined contribution plans
maintained by an Employer: (i) Employer contributions, (ii)
Employee Contributions, and (iii) forfeitures. Solely for
purposes of this subparagraph 1(a), the Total Compensation for
a totally disabled (within the meaning of Section 22(e) of the
Code) member of a profit sharing plan maintained by an
Employer is the compensation which the member would have
received for the year if the member had been paid at the rate
of compensation paid immediately before becoming permanently
and totally disabled; provided such imputed compensation may
be taken into account only if the member is not a Highly
Compensated Employee and only if contributions to the profit
sharing plan are nonforfeitable when made. In addition amounts
allocated to an individual medical account, as defined in
Section 415(l)(2) of the Code, which are part of a pension or
annuity plan maintained by an Employer, and amounts derived
from contributions paid or accrued after December 31, 1985, in
taxable years ending after such date,
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<PAGE> 26
which are attributable to post-retirement medical benefits
allocated to the separate account of a key employee, as
defined in Section 419A(d)(3) of the Code, under a welfare
benefit fund, as defined in Section 419(e) of the Code,
maintained by an Employer, shall also be treated as Annual
Additions;
(b) "Annual Benefit" means the Participant's annual
benefit payable in the form of a straight life annuity under
all qualified defined benefit plans maintained by an Employer,
excluding any benefits attributable to the Participant's
contributions or rollover contributions, if any, to the plans
or to any assets transferred from a qualified plan that was
not maintained by an Employer. No actuarial adjustment to the
benefit is required for (i) the value of a qualified joint and
survivor annuity, (ii) the value of benefits which are not
directly related to retirement benefits (such as a qualified
disability benefit, pre-retirement death benefit, or
post-retirement medical benefit), and (iii) the value of
post-retirement cost-of-living increases made in accordance
with regulations;
(c) "Defined Benefit Dollar Limitation" means the
dollar limitation set forth in Section 415(b)(1) of the Code
($130,000 for 1998), as adjusted by the Secretary of the
Treasury under Section 415(d) of the Code to reflect increases
in the cost-of-living, in such manner as the Secretary shall
prescribe (except rounded to the next lowest multiple of
$5,000);
(d) "Defined Contribution Dollar Limitation" means
the dollar limitation set forth in Section 415(c)(1)(A) of the
Code ($30,000 for 1998), as adjusted by the Secretary of the
Treasury under Section 415(d) of the Code to reflect increases
in the cost-of-living, in such manner as the Secretary shall
prescribe (except rounded to the next lowest multiple of
$5,000);
(e) "Employee Contributions" means contributions to
the Plan by a Participant during the Plan Year, without regard
to any rollover contributions (as defined in Sections 402(c),
403(a)(4), 403(b)(8), and 408(d)(3) of the Code), and without
regard to any employee contributions to a simplified employee
pension which are excludable from gross income under Section
408(k)(6) of the Code;
(f) "Employer" includes a corporation which is a
member of a controlled group of corporations or a trade or
business which is under common control as defined in Section
414(b) or (c) of the Code (as modified by Section 415(h)); a
service organization which is a member of an affiliated
service group which includes an Employer adopting this Plan,
as defined in Section 414(m) of the Code; a leasing
organization with respect to which an Employer adopting this
Plan is a "recipient" within the meaning of Section 414(n) of
the Code; and any other entity required to be aggregated with
the Employer pursuant to regulations under Section 414(o) of
the Code; and
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<PAGE> 27
(g) "Projected Annual Benefit" means the Annual
Benefit a Participant would receive, assuming the Participant
continued his employment and continued receiving his current
Total Compensation in each subsequent Plan Year until the
later of: (i) the Participant's Normal Retirement Age or (ii)
the Participant's current age, and further assuming that all
relevant factors used to determine benefits under the plan for
the current Plan Year remained constant for all future years.
2. The benefits to which a Participant may become entitled
will be subject to those additional limitations set forth herein.
(a) If a Participant of this Plan also is or has been
a participant in a defined benefit plan, as defined in Section
414(j) of the Code, or a welfare benefit fund, as defined in
Section 419(e) of the Code, to which contributions have been
made by the Employer, then in addition to the limitation
contained in subparagraph 1, the sum of the defined benefit
plan fraction and the defined contribution plan fraction for
any Plan Year shall not exceed 1.0. This limitation shall
apply only through the Plan Year ending December 31, 1999. For
purposes of this subparagraph 2:
(i) The defined benefit plan fraction for
any Plan Year is a fraction, the numerator being the
Projected Annual Benefit of the Participant under all
defined benefit plans maintained by the Employer
(determined as of the close of the Plan Year) and the
denominator being the lesser of:
(1) The product of 1.25 (1.0 in
the event this Plan is a Top-Heavy Plan)
multiplied by the Defined Benefit Dollar
Limitation, or
(2) The product of 1.4
multiplied by an amount which is 100% of the
Participant's average Total Compensation for
the three (3) consecutive Plan Years in
which his Total Compensation was the
highest.
Notwithstanding the above, the transition rules under
Section 415(e) of the Code are hereby incorporated by
reference for Participants who were members as of the
first day of the first Plan Year beginning after
December 31, 1986, in one or more defined benefit
plans maintained by the Employer which were in
existence on May 6, 1986.
(ii) The defined contribution plan fraction
for any Plan Year is a fraction, the numerator being
the sum of the Annual Additions to the accounts of
the Participant in all defined contribution plans as
of the end of the Plan Year under consideration, and
the denominator being the sum of the lesser of the
following amounts determined for such Plan Year and
for each prior year of service with the Employer:
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<PAGE> 28
(1) The product of 1.25 (1.0 in
the event this Plan is a Top-Heavy Plan)
multiplied by the Defined Contribution
Dollar Limitation, or
(2) The product of 1.4
multiplied by an amount equal to 25% of the
Participant's Total Compensation.
Notwithstanding the above, the transition rules under
Section 415(e) of the Code are hereby incorporated by
reference for Participants who were members as of the
first day of the first Plan Year beginning after
December 31, 1986, in one or more defined
contribution plans maintained by the Employer which
were in existence on May 6, 1986.
3. For purposes of the limitations contained in subparagraphs
1 and 2 of this Paragraph E, all defined contribution plans of the
Employer (whether or not terminated) shall be treated as one defined
contribution plan. Similarly, all defined benefit plans of the Employer
(whether or not terminated) shall be treated as one defined benefit
plan for these purposes.
4. Notwithstanding anything to the contrary contained in this
Paragraph E, in the event this Plan is a Top-Heavy Plan but would not
be a Top-Heavy Plan if "90 percent" were substituted for "60 percent"
each place it appears in the "Top-Heavy Plan" definition of Article I,
and, further, if the minimum contribution percentage in Paragraph C of
this Article IV is at least four percent (4%), then the special
provisions for Top-Heavy Plans contained in subparagraph E-2(a)(i)(1)
and (a)(ii)(1) shall not apply.
5. If the Annual Additions to a Participant's Account would
exceed the limitations described in subparagraphs 1 and 2 of this
Paragraph E, the following rules shall apply:
(a) If the Employer maintains both defined benefit
and defined contribution plans, any adjustment necessary to
meet the limitations of this Paragraph E shall be made by
first reducing the Participant's Annual Benefit under the
defined benefit plan(s);
(b) No Participant may make a contribution to this
Plan with respect to a Plan Year if the contribution would
cause the Annual Additions to the Participant's Account with
respect to such Plan Year to exceed the limitations set forth
in subparagraphs 1 and 2 of this Paragraph E; and
(c) Except as provided in subparagraph 6 of this
Paragraph E, and after taking into account the reductions
required in subparagraph 5(a), the Employer contributions to
this Plan on behalf of a Participant shall be reduced to the
extent necessary to prevent the Annual Additions to any
Participant's Account from exceeding the limitations set forth
in subparagraphs 1 and 2 of this Paragraph E.
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<PAGE> 29
6. If, due to a reasonable error in calculating a
Participant's Total Compensation for a Plan Year, or due to the
allocation of forfeitures, or due to such other facts and circumstances
as may justify the availability of this special rule, as determined by
the Internal Revenue Service, the Annual Additions to the Participant's
Account under this Plan and under any other defined contribution plan
maintained by an Employer exceed the limitations set forth in
subparagraphs 1 and 2 of this Paragraph E, then the aggregate of the
Annual Additions to this Plan and the Annual Additions to any other
defined contribution plan referred to in subparagraph 3 of this
Paragraph E shall be reduced, until the applicable limitation is
satisfied, by refunding any Employee contributions to any other defined
contribution plan, which would be aggregated with the Annual Additions
to this Plan, together with earnings thereon, pursuant to subparagraph
3 of this Paragraph E.
7. If, after the reduction provided in subparagraph 6, there
remains an excess amount which cannot be allocated to the Participant,
such Employer contribution provisionally allocated to a Participant's
Account in excess of the limitations of subparagraphs 1 and 2 of this
Paragraph E shall be credited to a suspense account and shall serve to
reduce Employer contributions to the Plan on behalf of the Participant
in the next Plan Year and in succeeding Plan Years in accordance with
the limitations of subparagraphs 1 and 2 of this Paragraph E.
8. The Employer elects to use the Plan Year as the limitation
year for purposes of Section 415 of the Code.
F. Transfers from Other Plans
1. Transfers from Other Qualified Plans. An Eligible Employee
who has had distributed to him all or a portion of his interest in a plan
meeting the requirements of Section 401(a) of the Code (the "Other Plan") may,
in accordance with procedures approved by the Committee (including without
limitation that the amount transferred consists solely of cash), transfer the
distribution received from the Other Plan to the Trustee, provided the following
conditions are met:
(a) The transfer occurs on or before the sixtieth
(60th) day after he receives the distribution from the Other
Plan; and
(b) The distribution from the Other Plan qualifies as
an eligible rollover distribution within the meaning of
Section 402(c)(4) of the Code.
Notwithstanding any other provision hereof, there may be
transferred directly from the trustee of the Other Plan to the Trustee,
subject to the approval of the Company, all or any of the assets,
including after-tax contributions, if any, held (whether by trustee,
custodian or otherwise) on behalf of any Other Plan which is maintained
for the benefit of any Eligible Employees who are or are about to
become Participants of this Plan. Transfers pursuant to this
subparagraph may be made regardless of whether the Eligible Employee
has satisfied the service requirements of Paragraph A of Article II.
Amounts transferred
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<PAGE> 30
pursuant to this Paragraph F, and any gains or losses allocable
thereto, shall be accounted for separately from amounts otherwise
allocable to the Eligible Employee under the Plan.
2. Transfers From Individual Retirement Accounts. An Eligible
Employee who receives a distribution from an individual retirement
account described in Section 408(a) of the Code or an individual
retirement annuity described in Section 408(b) of the Code which
constitutes the entire amount of such account or annuity (including
earnings thereon), and no portion of which is attributable to any
source other than a rollover contribution described in Section 402 of
the Code, may, in accordance with procedures approved by the Committee
(including without limitation that the transfer consists solely of
cash), transfer the entire amount of such distribution to the Trustee,
within sixty (60) days after receiving the distribution. Transfers
pursuant to this subparagraph may be made regardless of whether the
Eligible Employee has satisfied the service requirements of Paragraph A
of Article II.
3. Administration. The Committee shall develop such
procedures, including procedures for obtaining information from an
Eligible Employee desiring to make such a transfer, as it deems
necessary or desirable to enable it to determine that the proposed
transfer will meet the requirements of this Paragraph F. If such
requirements are met, the amount transferred shall be deposited in the
Trust Fund and shall be credited to a Rollover Account. The Rollover
Account shall be one hundred percent (100%) vested in the Eligible
Employee and shall share in the allocation of gains or losses, as the
case may be, in accordance with Paragraph B hereof, but shall not share
in any other allocations. Upon termination of employment, the total
amount of the Eligible Employee's Rollover Account shall be distributed
in accordance with Article VI. In the case of an Eligible Employee who
has not completed the service requirements of Paragraph A of Article II
at the date of the transfer, the Rollover Account shall represent the
Eligible Employee's sole interest in the Plan until he becomes a
Participant.
ARTICLE V
VESTING OF EMPLOYER CONTRIBUTIONS
A. Vesting
1. The Participant shall vest in his Salary Deferral Account
and Employer Minimum Contribution Account in accordance with this
Article V.
(a) The Salary Deferral Account and Employer Minimum
Contribution Account of a Participant shall be fully vested
and nonforfeitable at all times, and shall not be subject to
divestment for cause.
ARTICLE VI
DISTRIBUTION OF BENEFITS
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<PAGE> 31
A. Methods of Distribution
1. The distribution of benefits to which a Participant may
become entitled shall be made in accordance with this Article VI.
Notwithstanding any Plan provision to the contrary, all Plan
distributions shall comply with the requirements of Section 401(a)(9)
of the Code and the regulations thereunder, including the incidental
death benefit distribution rules in Section 1.401(a)(9)-2.
(a) The benefits provided by the Plan shall be
distributed in a single distribution in cash of the entire
vested balance then standing in the Participant's Account
(reduced by any security interest held by the Plan by reason
of a loan outstanding to the Participant).
(b) Notwithstanding the foregoing, the Participant
(or Beneficiary, as applicable) may elect that the
distribution be in the form of Company common stock up to the
number of full shares then reflected in the portion of the VF
Corporation Stock Fund (as described in Paragraph C of Article
VIII) allocated to such Participant (or Beneficiary) and the
balance of the Participant's Account in cash, or a lesser
number of shares of Company common stock and the balance of
the Account in cash.
2. If a Participant dies before all events have occurred which
entitle the Participant to a distribution of benefits, his vested
Account balance (reduced by any security interest held by the Plan by
reason of a loan outstanding to the Participant) shall be distributed
to his Beneficiary in a single distribution at the time set forth in
Paragraph C of this Article VI.
B. Time of Distribution to Participant
1. The Committee must provide the Participant with a "general
notice of distribution" no less than thirty (30) and no more than
ninety (90) days before the Participant's distribution commencement
date. Such notice must be in writing and must set forth the following
information: (i) an explanation of the eligibility requirements for,
the material features of, and the value of the form of benefits
available under subparagraph A-1 of this Article VI, and (ii) the
Participant's right to defer receipt of a Plan distribution under
subparagraphs B-3 and B-4 of this Article VI. Such notice shall be
given to the Participant in person, by mailing, by posting, or by
placing it in an Employer publication which is distributed in such a
manner as to be reasonably available to such Participant. If the notice
is to be posted, it shall be posted at the location within the
Participant's principal place of employment which is customarily used
for employer notices to employees with regard to labor-management
relation matters.
2. Upon receipt of the general notice of distribution, a
Participant may consent to receive a distribution of his vested Account
as soon as practicable after his termination of service. The
distribution may commence less than thirty (30) days after the general
notice
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is given, if the distribution is one to which Sections 401(a)(11) and
417 of the Code do not apply, provided the Committee clearly informs
the Participant pursuant to the notice that the Participant has a right
to a period of at least thirty (30) days after receiving the notice to
consider the decision of whether or not to elect a distribution (and,
if applicable, a particular distribution method), and the Participant,
after receiving the notice, affirmatively elects a distribution. A
Participant's vested Account shall be distributed in the manner set
forth in subparagraph A-1 of this Article VI.
3. To the extent not inconsistent with subparagraph B-4 below,
payment of the vested balance in the Participant's Account shall begin
no later than the 60th day after the latest of the close of the Plan
Year in which:
(a) The Participant attains the earlier of age
sixty-five (65) or Normal Retirement Age;
(b) Occurs the tenth (10th) anniversary of the year
in which the Participant entered the Plan; or
(c) The Participant terminates service with the
Employer.
4. In the event that the Participant has terminated service
and the Participant (and the Eligible Spouse, if applicable) does not
consent to receive a Plan distribution, the Participant's vested
Account shall be distributed in a single distribution as soon as
practicable thereafter, but in no event before the date the Participant
attains Normal Retirement Age (unless the Participant (and the Eligible
Spouse, if applicable) elects and consents to an earlier distribution),
if such vested Account exceeds $5,000.
5. If the form of distribution is other than a single
distribution, then the Participant's entire interest shall be paid over
a period not extending beyond the life (or the life expectancy) of the
Participant, or the lives (or the joint life and last survivor
expectancy) of the Participant and his Beneficiary.
6. Notwithstanding anything to the contrary contained in this
Plan, distribution of the vested balance in the Participant's Account
shall be made no later than April 1st of the calendar year following
the calendar year in which the Participant (a) attains age 70-1/2 or
(b) terminates employment, whichever occurs later; provided, however,
that subparagraph B-6(a) shall not apply to an Employee who was a
five-percent (5%) owner (as defined in Section 416 of the Code) with
respect to the Plan Year ending in the calendar year in which the
Employee attains age 70-1/2. If it is not possible to make the required
payment because of the Committee's inability to locate the Participant
after making reasonable efforts to do so, a payment retroactive to the
required commencement date shall be made no later than sixty (60) days
after the date the Participant is located.
7. In the event of a physical or mental impairment that
qualifies a Participant for disability benefits under a long term
disability benefits plan maintained by the Employer
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and/or eligibility for disability benefits under the Social Security
Act, the Participant shall be entitled to a distribution of the entire
balance of his Account (reduced by any security interest held by the
Plan by reason of a loan outstanding to the Participant), distributed
in the manner set forth in subparagraph A-1 of this Article VI and
subject to the notice and consent requirements of subparagraphs B-1,
B-2 and B-4 of this Article VI. The determination of total disability
for purposes of this subparagraph shall be based solely on the
Participant's receipt of disability payments under an
Employer-sponsored long term disability benefits plan or the Social
Security Act.
C. Time of Distribution to Beneficiary
1. A Participant's Beneficiary shall receive a distribution of
the Participant's vested Account balance which shall commence within
ninety (90) days (or within such longer period as is reasonable based
on the particular facts and circumstances) after the Participant's
death, to be distributed in the manner set forth in subparagraph A-2 of
this Article VI.
2. Notwithstanding any provision of this Article VI to the
contrary, any distribution to a Participant's Beneficiary must comply
with the following requirements:
(a) If distributions to a Participant have begun and
the Participant dies before his entire interest has been
distributed to him, the remaining portion shall be distributed
at least as rapidly as under the distribution method being
utilized on the date of his death.
(b) In no event shall distributions be made later
than December 31 of the calendar year which contains the fifth
anniversary of the Participant's death.
D. Small Account Balances
Notwithstanding anything to the contrary in Paragraphs A, B and C of
this Article VI, if the Participant has terminated service or has died with a
vested Account balance of $5,000 or less on the date distributions commence, the
entire vested Account balance shall be distributed in a single sum distribution
as soon as practicable to the Participant, or, in the event of his death, to his
Beneficiary.
E. Nonliability
Any payment to any Participant, or to his legal representative or
Beneficiary, in accordance with the provisions of the Plan, shall to the extent
thereof be in full satisfaction of all claims hereunder against the Trustee, the
Committee and the Employer, any of whom may require such Participant, legal
representative or Beneficiary, as a condition precedent to such payment, to
execute a receipt therefor in such form as shall be determined by the Trustee,
the Committee, or the Employer, as the case may be. The Employer does not
guarantee the Trust, the Participants, former Participants or their
Beneficiaries against loss of or depreciation in value of any right or benefit
that
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any of them may acquire under the terms of this Plan. All benefits payable
hereunder shall be paid or provided for solely from the Trust, and the Employer
does not assume any liability or responsibility therefor.
F. Distributions Prior to Termination of Employment
A Participant's Accounts in the Plan shall be subject to distribution
prior to separation from service in accordance with the following:
1. Such distribution shall be made only on account of:
(a) The termination of the Plan without establishment
or maintenance of another defined contribution plan (other
than an employee stock ownership plan as defined in Section
4975(e)(7) of the Code);
(b) The sale or other disposition by a corporation of
substantially all of its assets (within the meaning of Section
409(d)(2) of the Code) used by such corporation in a trade or
business of such corporation with respect to a Participant who
continues employment with the corporation acquiring such
assets;
(c) The sale or other disposition by a corporation of
such corporation's interest in a subsidiary (within the
meaning of Section 409(d)(3) of the Code) with respect to a
Participant who continues employment with such subsidiary;
(d) The showing of Financial Hardship by the
Participant as provided in Paragraph G of this Article VI; or
(e) The Participant's attainment of age 59 1/2.
Notwithstanding the foregoing, any distribution made pursuant to subparagraphs
F-1(a), F-1(b) and F-1(c) above must meet the requirements of Section 401(k)(10)
of the Code.
2. Application for distribution under this Paragraph F shall be made in
writing by the Participant, and shall be made in accordance with the method of
distribution and the notice requirements set forth in subparagraphs A-1, B-1 and
B-2 of this Article VI.
3. In the event that the distribution is due to the Plan's termination,
distributions shall be made in accordance with the following rules:
(a) If the Employer or any other entity within the same
controlled group (within the meaning of Sections 414(b), (c) and (m) of
the Code) as the Employer does not maintain another profit sharing
plan, money purchase pension plan (including a target benefit plan), or
a stock bonus plan (other than an employee stock ownership plan as
defined in Section 4975(e)(7) of the Code) at the time the
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Plan is terminated, the Participant shall receive a single distribution
as soon as practicable after Plan termination.
(b) If the Employer or any other entity within the same
controlled group (within the meaning of Sections 414(b), (c) and (m) of
the Code) as the Employer maintains another profit sharing plan, money
purchase pension plan (including a target benefit plan), or a stock
bonus plan (other than an employee stock ownership plan as defined in
Section 4975(e)(7) of the Code) at the time the Plan is terminated, the
Participant may consent to a Plan distribution to commence as soon as
practicable after Plan termination, provided that consent of the
Participant is obtained. In the event that the Participant does not
consent to such distribution, his Account balance shall be transferred
to an account established for such Participant in such other plan
provided that such transfer does not violate Section 411(d)(6) of the
Code and the regulations thereunder.
(c) Notwithstanding the foregoing, the Participant's Account
balance shall be distributed in accordance with Paragraph D of this
Article VI if the Account balance does not exceed $5,000 at the time
the distribution is to be made.
G. Withdrawals on Account of Financial Hardship
1. Withdrawals on account of Financial Hardship shall be permitted from
the Rollover Account and the Salary Deferral Account of the Participant.
Withdrawals from the Salary Deferral Account shall be limited to the amount of
the contributions to such Account. No amount attributable to income on such
contributions may be withdrawn from the Salary Deferral Account on account of
such hardship. Withdrawals on account of Financial Hardship shall be taken first
from the Participant's Rollover Account, if any, and then from the Participant's
Salary Deferral Account.
2. The Participant must demonstrate to the Committee that a withdrawal
under this Paragraph G is necessary to satisfy a Financial Hardship. The amount
of the withdrawal may include any amounts necessary to pay any federal, state or
local income taxes or penalties reasonably anticipated to result from the
withdrawal. The Participant may demonstrate such need by certifying to the
Committee that the Financial Hardship cannot reasonably be relieved:
(a) Through reimbursement or compensation by insurance or
otherwise;
(b) By liquidation of the Employee's assets;
(c) By cessation of Elective Deferrals or employee
contributions under the Plan or other plans maintained by the Employer
or any other employer;
(d) By other distributions or nontaxable loans from plans
maintained by the Employer or any other employer; or
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(e) By borrowing from commercial sources on reasonable
commercial terms in an amount sufficient to satisfy the Financial
Hardship.
Assets owned by an Employee's spouse or minor children that
are reasonably available to the Employee shall be considered resources
of the Employee. A Financial Hardship cannot reasonably be relieved by
one of the actions listed in subparagraphs G- 2(a) through G-2(e) above
if the effect would be to increase the amount of the Financial
Hardship.
3. In lieu of satisfying subparagraph G-2 above, a Participant may
receive a distribution not in excess of the amount necessary to satisfy the
expense of a Financial Hardship (including any amounts necessary to pay any
federal, state or local income taxes or penalties reasonably anticipated to
result from the distribution) if the Participant has obtained all other
distributions and all nontaxable loans currently available under this Plan and
all other plans maintained by the Employer. In order to receive a distribution
under this subparagraph G-3, the Participant shall not be permitted to make
Elective Deferrals or after-tax employee contributions to any qualified or
nonqualified plan of the Employer (including, but not limited to, stock option
and stock purchase plans and cafeteria plans within the meaning of Section 125
of the Code), except for mandatory employee contributions to a defined benefit
plan of the Employer and employee contributions to health or welfare plans of
the Employer, within twelve months after the Financial Hardship withdrawal. In
addition, the Participant's Elective Deferrals made in the calendar year
following a withdrawal on account of a Financial Hardship under this
subparagraph G-3 shall not exceed $10,000 (as adjusted by the Secretary of the
Treasury at the same time and in the same manner as under Section 415(d) of the
Code), reduced by the Participant's elective contributions which were made in
the calendar year of the Financial Hardship withdrawal.
4. Application for Financial Hardship withdrawal shall be made in
writing by the Participant, and shall be made in accordance with the method of
distribution and the notice requirements set forth in subparagraphs A-1, B-1,
and B-2 of this Article VI.
H. Direct Rollover of Eligible Rollover Distributions
1. Direct Rollover Availability. Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a distributee's election under
this subparagraph H, a distributee may elect, at the time and in the manner
prescribed by the Committee, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan specified by the
distributee in a direct rollover.
2. Definitions.
(a) Eligible Rollover Distribution - An eligible rollover
distribution is any distribution of all or any portion of the balance
to the credit of the distributee, except that an eligible rollover
distribution does not include: any distribution that is one of a series
of substantially equal periodic payments (not less frequently than
annually) made for the life (or life expectancy) of the distributee or
the joint lives (or joint life expectancies) of the
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distributee and the distributee's designated beneficiary, or for a
specified period of ten years or more; any distribution to the extent
such distribution is required under Code Section 401(a)(9); and the
portion of any distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
(b) Eligible Retirement Plan - An eligible retirement plan is
an individual retirement account described in Code Section 408(a), an
individual retirement annuity described in Code Section 408(b), an
annuity plan described in Code Section 403(a), or a qualified trust
described in Code Section 401(a), that accepts the distributee's
eligible rollover distribution. However, in the case of an eligible
rollover distribution to the surviving spouse, an eligible retirement
plan is an individual retirement account or individual retirement
annuity.
(c) Distributee - A distributee includes a Participant or
former Participant. In addition, the Participant's or former
Participant's surviving spouse and the Participant's or former
Participant'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.
(d) Direct Rollover - A direct rollover is a payment by the
Plan to the eligible retirement plan specified by the distributee.
I. Loans to Participants
Upon application of a Participant to the Committee, the Committee shall
direct the Trustee to make loans to the Participant from his Account under the
Plan as provided in this Paragraph I.
1. A loan to a Participant (when added to the outstanding
balance of all other loans from this Plan and any other qualified plan
maintained by the Employer) shall not be in an amount that exceeds the
lesser of:
(a) $50,000, reduced by the excess, if any, of:
(i) The highest outstanding balance of loans from the
Plan during the one (1) year period ending on the day before
the date such loan is made, over
(ii) The outstanding balance of loans from the Plan
on the date such loan is made; or
(b) Fifty percent (50%) of the vested balance of such
Participant's Account.
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2. The Participant shall submit an application to the
Committee indicating the name of the Participant, the amount of the
loan requested, and any collateral to be pledged in addition to a
portion of the Participant's vested right, title and interest in his
Account.
3. A loan requested by a Participant shall be approved by the
Committee if the Committee determines that the loan will not constitute
a taxable distribution from the Plan, the loan is adequately secured,
and, if applicable, the spouse of the Participant consents to the loan.
The only other factors which may be taken into consideration when
determining whether or not to approve a loan are those which would be
considered in a normal commercial setting by an entity in the business
of making similar types of loans.
4. This loan program shall be administered in accordance with
the rules set forth in this Article VI and written procedures
established by the Committee. Such written procedures shall include,
but need not be limited to, the following:
(a) The identity of the persons or positions
authorized to administer the Participant loan program;
(b) The procedure for applying for Plan loans;
(c) The basis on which loans will be approved or
denied;
(d) The limitation, if any, on the types and amounts
of loans offered;
(e) The procedure for determining a reasonable rate
of interest to be charged for Plan loans, provided that such
rate (i) shall be selected by the Committee and adjusted from
time-to-time as necessary when any loan is granted, renewed or
otherwise modified and (ii) shall provide the Trust with a
return commensurate with the interest rates charged by persons
in the business of lending money for loans which would be made
under similar circumstances;
(f) The types of collateral which may secure a
Participant's loan, provided that if the Participant's Account
is to be used as collateral, such collateral (when added to
the Participant's benefit pledged as collateral for all
outstanding loans) does not exceed fifty percent (50%) of the
Participant's vested Account determined immediately after the
origination of the loan, and the loan is supported by the
Participant's collateral promissory note for the amount of the
loan payable to the Trustee; and
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(g) The events constituting default and the steps
that will be taken to preserve Plan assets in the event of
such default.
5. The minimum amount of a loan is $1,000.
6. Interest on a loan shall be charged at a rate equal to the prime
rate stated in the Money Rates section of The Wall Street Journal on the date
the loan application is received by the Committee.
7. The term of a loan shall not exceed five (5) years (ten (10) years
for a loan used to acquire a principal residence of the Participant), and,
except as provided by the Secretary of the Treasury, shall require substantially
level amortization of the loan (with payments by payroll deduction) over its
term.
8. If any loan made hereunder to a Participant is not repaid in
accordance with its terms (subject to any grace period permitted by the
Committee in accordance with regulations of the Secretary of the Treasury), the
loan shall be in default. If the loan is in default, the Committee shall deduct
the total amount thereof, including interest thereon, from any distribution of
Trust assets to which the Participant or his Beneficiary may be entitled, at the
earliest time the distribution otherwise would be allowed under the terms of
this Plan. If the Participant's Account is not sufficient to pay the remaining
balance of any such loan, he shall be liable for any balance still due.
9. As of the loan date, an amount equal to the principal amount of the
loan shall be deducted from the Participant's Account. Loan repayments by a
Participant shall be credited to the Participant's Account under the Plan.
10. No loan shall be made to a Participant during a period in which the
Committee is making a determination of whether a domestic relations order
affecting the Participant's Account is a "qualified domestic relations order",
within the meaning of Section 414(p) of the Code. Further, if the Committee is
in receipt of a qualified domestic relations order with respect to a
Participant, it may prohibit such Participant from obtaining a loan until the
alternate payee's rights under such order are satisfied.
ARTICLE VII
BENEFICIARIES
A. Designation
A Participant shall have the right to designate, on forms provided by
the Committee, a Beneficiary or Beneficiaries to receive the benefits herein
provided in the event of his death (reduced by any security interest held by the
Plan by reason of a loan outstanding to the Participant) and to revoke such
designation or to substitute another Beneficiary or Beneficiaries at any time.
Notwithstanding the preceding sentence, a married Participant's initial
designation of a
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Beneficiary or change in Beneficiary designation to someone
other than or in addition to his Eligible Spouse shall not be effective unless
Spousal Consent is obtained.
B. Absence of Valid Designation of Beneficiaries
If, upon the death of a Participant, former Participant or Beneficiary,
there is no valid designation of Beneficiary on file with the Committee, the
following shall be designated by the Committee as the Beneficiary or
Beneficiaries, in order of priority:
1. The surviving spouse;
2. Surviving children, including adopted children, in equal
shares;
3. Surviving parents, in equal shares;
4. The Participant's estate;
5. The Beneficiary's estate.
The determination of the Committee as to which persons, if any, qualify
within the categories listed above shall be final and conclusive upon all
persons.
ARTICLE VIII
ESTABLISHMENT OF TRUST; DIRECTED INVESTMENTS
A. Trust Agreement
Contributions made by the Employer and all other assets of this Plan
shall be held in trust under a Trust Agreement. The Employer shall enter into a
Trust Agreement with the Trustee for the administration of the Trust which shall
contain the assets of the Plan. The Trustee shall not be responsible for the
administration of this Plan but only for the Trust established pursuant to this
Plan.
B. Trust Agreement Part of Plan
The Trust Agreement shall be deemed to be a part of this Plan, and any
rights or benefits accruing to any person under this Plan shall be subject to
all of the relevant terms and provisions of the Trust Agreement, including any
amendments. In addition to the powers of the Trustee set forth in the Trust
Agreement, the Trustee shall have any powers, express or implied, granted to it
under the Plan. In the event of any conflict between the provisions of the Trust
Agreement and the provisions of the Plan, the provisions of the Plan shall
control, except for the duties and responsibilities of the Trustee, in which
case the Trust Agreement shall control.
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C. Participant-Directed Investments
Each Participant shall have the right to direct the investment of his
own Account, provided the Participant elects to do so in writing in accordance
with the Plan's provisions. Such contributions shall be invested in various
investment vehicles as directed by the Participant pursuant to the following
provisions of this Plan.
1. The Committee shall establish, from time to time, one or
more separate and distinct investment vehicles. Each Participant shall
have the right to elect the percentage (in whole percentages) of his
contribution which he wishes to have invested in each vehicle. The
right to elect among such investment vehicles as set forth herein shall
be the sole and exclusive investment power granted to a Participant.
The Committee, at its discretion, may make available to the
Participants one or more of the following investment vehicles:
(a) VF Corporation Stock Fund: Monies shall be
invested in common stock of the Company; and
(b) Other Vehicles: Such other investment vehicles
which the Committee may select.
2. A Participant may, by filing a written election with the
Committee, elect to change the investment vehicles (and/or the
percentages (in whole percentages) to be allocated thereto) in which
(i) his current Account balance and future earnings thereon are to be
invested and (ii) future contributions and earnings thereon are to be
invested; provided, however, that no more than fifty percent (50%) of
the Participant's contributions may be invested in the VF Corporation
Stock Fund.
(a) Subject to the restriction on investment in the
VF Corporation Stock Fund set forth in subparagraph C-2 above,
any transfer direction with respect to a change in the
investment of a Participant's current Account balance and
future earnings thereon, which is made through a written
election filed with the Committee at least ten (10) days prior
to the end of a month (or such other deadline as shall be
specified by the Committee) shall become effective as of the
first day of the following month, or as soon as
administratively feasible thereafter.
(b) Subject to the restriction on investment in the
VF Corporation Stock Fund set forth in subparagraph C-2 above,
a Participant's direction to change the investment of his
future contributions and earnings thereon, which is made
through a written election filed with the Committee at least
ten (10) days prior to the end of a month (or such other
deadline as shall be specified by the Committee) shall become
effective as of the first day of the following month, or as
soon as administratively feasible thereafter.
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A Participant's current Account balance and his future contributions thereto
shall continue to be invested in accordance with the Participant's most recent
election, until the effective date of the Participant's investment election
change, if any.
3. In the event that the Participant does not make an initial
election to direct such investments, all amounts held for the
Participant shall be invested in the investment vehicle or vehicles
selected by the Committee in its absolute discretion, and the Committee
shall be absolved of any liability for any decision so made to the
extent permitted by ERISA.
4. The Committee shall provide each Participant with
information relating to these investment procedures and the investment
vehicles offered at the time the Participant is first eligible to
participate in the Plan. The Committee may establish such rules as it
deems necessary to administer and implement the provisions of this
Paragraph C.
D. Directions to Committee
A Participant shall exercise his rights under this Article by written
instructions to the Committee. The Committee shall transmit the Participant's
directions to the Trustee in such form as the Committee and Trustee shall
determine.
E. Duty to Evaluate Investments
Neither the Committee, the Trustee nor any fiduciary under the Plan
shall have any duty to evaluate any investment decision made by the Participant,
including the decision to retain an investment. However, the Committee and the
Trustee shall have the express power to refuse any investment direction of the
Participant which would be administratively burdensome or which the Committee or
the Trustee believes would constitute a prohibited transaction as defined in
Section 406 and Section 407 of ERISA or Section 4975 of the Code.
F. Costs of Investments
The costs of making, retaining and divesting the investments of the
Trust shall be charged directly to the Trust and shall be treated as an expense
of the Trust.
G. Rules of Committee
The Committee may establish such rules, regulations and procedures as
it deems necessary to carry out the purposes of Paragraphs C, D and E of this
Article.
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ARTICLE IX
PLAN FIDUCIARIES AND ADMINISTRATION
A. Named Fiduciaries
The authority to control and manage the operation and administration of
the Plan is vested in the named fiduciaries specified herein. Each named
fiduciary shall be responsible solely for the tasks allocated to it. No
fiduciary shall have any liability for a breach of fiduciary responsibility of
another fiduciary with respect to the Plan and Trust, unless it participates
knowingly in the breach; has actual knowledge of the breach and fails to take
reasonable remedial action to remedy said breach; or, through its negligence in
performing its own specific fiduciary responsibilities, which give rise to its
status as a fiduciary, it has caused another fiduciary to commit a breach of
fiduciary responsibility.
B. Fiduciary Standard
Each named fiduciary and every other fiduciary under the Plan shall
discharge its duties with respect to the Plan solely in the interests of the
Participants and Beneficiaries and:
1. For the exclusive purpose of providing benefits to
Participants and their Beneficiaries and defraying reasonable expenses
of administering the Plan;
2. With the care, skill, prudence and diligence, under the
circumstances then prevailing, that a prudent man acting in a like
capacity and familiar with such matters would use in the conduct of an
enterprise of a like character and with like aims; and
3. In accordance with the documents and instruments governing
the Plan, insofar as these are consistent with the provisions of Title
I of ERISA.
C. Multiple Duties and Advisors
Any person or group of persons may serve in more than one fiduciary
capacity with respect to the Plan. A named fiduciary, or a fiduciary designated
by a named fiduciary in accordance with the terms of the Plan, may employ one or
more persons to render advice with regard to any responsibilities such fiduciary
has under the Plan.
D. Allocation and Delegation of Fiduciary Duties
Each named fiduciary may allocate its fiduciary duties among its
members or may delegate its responsibilities to persons who are not named
fiduciaries with respect to the specific responsibility delegated. Any such
allocation or delegation shall be in writing and shall be made a permanent part
of the records of the named fiduciary. Such allocation or delegation shall be
reviewed periodically by the named fiduciary and shall be terminable upon such
notice as the named fiduciary, in its sole discretion, deems reasonable and
prudent under the circumstances. An
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action by the Company or the Committee allocating or delegating its named
fiduciary responsibilities shall be evidenced by a duly adopted writing of the
Company or resolution of the Committee.
E. Indemnification
Any Employer shall indemnify and hold harmless the named fiduciaries
and any officers or employees of the Employer to which fiduciary
responsibilities have been delegated, from and against any and all liabilities,
claims, demands, costs and expenses, including attorneys' fees, which may arise
out of an alleged breach in the performance of their fiduciary duties under the
Plan and under ERISA, other than such liabilities, claims, demands, costs and
expenses as may result from the gross negligence or willful misconduct of such
persons. The Company shall conduct the defense of such persons in any proceeding
to which this Paragraph applies. An Employer may satisfy its obligation under
this Paragraph, in whole or in part, through the purchase of a policy or
policies of insurance; however, no insurer shall have any rights against the
Employer arising out of this Paragraph.
F. Costs and Expenses
The costs and expenses of the named fiduciaries shall be paid from Plan
assets held in the Trust to the extent not paid by the Company. The payment by
the Company of such costs and expenses for a Plan Year shall not be deemed an
election to pay the costs and expenses in any subsequent Plan Year. The Company
may charge to an Employer such expenses advanced by it on behalf of the
Employer.
G. Authority to Amend and Terminate
Subject to Article X, the Company is the named fiduciary responsible
for the amendment and termination of the Plan and Trust. In addition, the
Company shall appoint and replace the members of the Committee.
H. Committee
1. The VF Corporation Pension Committee (or more briefly denoted as
"the Committee") is the named fiduciary with the power and the duty to: (a)
interpret the terms of the Plan; (b) formulate rules and regulations necessary
to administer the Plan in accordance with its terms; (c) finally review claims
under the claims review procedure; (d) establish and execute the funding policy
of the Plan; and (e) annually review the funding policy and method.
2. The Committee shall keep minutes of its meetings and proceedings
regarding the Plan. Except as otherwise provided herein, every decision made or
action taken by a majority of the members then in office shall constitute a
decision or action of the Committee, and shall be final, conclusive and binding
upon all persons affected. A Committee decision or action, under or in
connection with the Plan, may be made or taken either at a meeting held pursuant
to its rules, at which a majority of the members then in office are present and
vote in favor thereof, or without a
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meeting if approved and evidenced by a writing signed by a majority of the
members then in office. No Committee member shall vote on any question relating
solely to himself.
I. Plan Administration
The Committee shall be the Administrator of the Plan for purposes of
Section 3(16) of ERISA and Section 414(g) of the Code. In addition, the
Committee as Administrator shall have the power and the duty to perform the
following administrative functions according to the policies, interpretations,
rules, practices and procedures established by the Company or itself in
accordance with the respective areas of named fiduciary responsibilities:
1. Apply Plan rules determining eligibility for participation
or benefits;
2. Calculate service and compensation credits for benefits;
3. Prepare employee communications material;
4. Maintain Participants' service and employment records;
5. Prepare reports required by government agencies, which
shall include maintaining records to demonstrate compliance with the
nondiscrimination requirements of Article III of the Plan;
6. Calculate benefits which satisfy the requirements of
Sections 401 (a)(9), 401 (a)(11) and 417 of the Code;
7. Orient new Participants and advise Participants regarding
their rights and options under the Plan;
8. Collect contributions and apply contributions as provided
in the Plan;
9. Prepare reports concerning Participants' benefits;
10. Process claims; and
11. Make recommendations to the Company on matters of Plan
administration within the scope of the Company's named fiduciary
responsibilities.
The Administrator (and those to whom it has delegated its authority) shall have
vested in it under the terms of this Plan full discretionary and final authority
when exercising its duties hereunder.
J. Claims Procedures
1. Filing of Claim. A Participant or Beneficiary who believes
he is entitled to a benefit which he has not received may file a claim
in writing with the
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<PAGE> 46
Committee. The Committee may require a claimant to submit additional
information, if necessary to process the claim. The Committee shall
review the claim and render its decision within ninety (90) days from
the date the claim is filed (or the requested additional information is
submitted, if later), unless special circumstances require an extension
of time for processing the claim. If such an extension is required,
written notice of the extension shall be furnished the claimant within
the initial ninety (90) day period. The notice shall indicate the
special circumstances requiring the extension and the date by which the
Committee expects to reach a decision on the claim. In no event shall
the extension exceed a period of ninety (90) days from the end of the
initial period.
2. Notice of Claim Denial. If the Committee denies a claim, in
whole or in part, it shall provide the claimant with written notice of
the denial within the period specified in subparagraph 1. The notice
shall be written in language calculated to be understood by the
claimant, and shall include the following information:
(a) The specific reason for such denial;
(b) Specific reference to pertinent Plan provisions
upon which the denial is based;
(c) A description of any additional material or
information which may be needed to clarify or perfect the
request, and an explanation of why such information is
required; and
(d) An explanation of the Plan's review procedure
with respect to the denial of benefits.
3. Review Procedure. Any claimant whose claim has been denied,
in whole or in part, shall follow those review procedures as set forth
herein.
(a) A claimant whose claim has been denied, in whole
or in part, may request a full and fair review of the claim by
the Committee by making written request therefor within sixty
(60) days of receipt of the notification of denial. The
claimant shall be permitted to examine all documents pertinent
to the claim and shall be permitted to submit issues and
comments regarding the claim to the Committee in writing.
(b) The Committee shall render its decision within
sixty (60) days after receipt of the application for review,
unless special circumstances (such as the need to hold a
hearing) require an extension of time for processing, in which
case the decision shall be rendered as soon as possible but
not later than one hundred and
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twenty (120) days after receipt of a request for review. If an
extension of time is necessary, written notice shall be
furnished the claimant before the extension period commences.
(c) The Committee shall decide whether a hearing
shall be held on the claim. If so, it shall notify the
claimant in writing of the time and place for the hearing.
Unless the claimant agrees to a shorter period, the hearing
shall be scheduled at least fourteen (14) days after the date
of the notice of hearing. The claimant and/or his authorized
representative may appear at any such hearing.
(d) The Committee shall send its decision on review
to the claimant in writing within the time specified in (b)
above. If the claim is denied, in whole or in part, the
decision shall specify the reasons for the denial in a manner
calculated to be understood by the claimant, referring to the
specific Plan provisions on which the decision is based. The
Committee shall not be restricted in its review to those
provisions of the Plan cited in the original denial of the
claim.
(e) If the Committee does not furnish its decision on
review within the time specified in this subparagraph 3, the
claim shall be deemed denied on review.
K. Agent for Legal Process
The Committee shall be the Plan's agent for service of legal process.
L. Voting and Tender of Company Stock
1. Voting of Company Stock. The provisions of this subparagraph L-1
shall under all circumstances apply to all shares of VF Corporation common stock
("Company Stock") in the VF Corporation Stock Fund. Each Participant (or
Beneficiary, as applicable) is, for purposes of this subparagraph L-1, hereby
designated as a "named fiduciary" (within the meaning of ERISA) with respect to
the shares of Company Stock allocated to his Account, and shall have the right
to direct the Trustee with respect to the vote of the shares of Company Stock
allocated to his Account, on each matter brought before any meeting of the
stockholders of the Company. Before each such meeting of stockholders, the
Company shall cause to be furnished to each Participant (or Beneficiary) a copy
of the proxy solicitation material, together with a form requesting confidential
directions to the Trustee on how such shares of Company Stock allocated to such
Participant's (or Beneficiary's) Account shall be voted on each such matter.
Upon timely receipt of such directions, the Trustee shall on each such matter
vote as directed the number of shares (including fractional shares) of Company
Stock allocated to such Participant's (or Beneficiary's) Account, and the
Trustee shall have no discretion in such matter. The instructions received by
the Trustee from Participants (or Beneficiaries) shall be held by the Trustee in
confidence and shall not be divulged
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<PAGE> 48
or released to any person, including the Committee or officers or employees of
the Company or any other Employer. The Trustee shall vote allocated shares of
Company Stock for which it has not received direction, in the same proportion as
directed shares are voted, and the Trustee shall have no discretion in such
matter.
2. Tender of Company Stock. The provisions of this subparagraph L-2
shall under all circumstances apply to all shares of Company Stock in the VF
Corporation Stock Fund. The provisions of this subparagraph L-2 shall apply in
the event a tender or exchange offer, including but not limited to a tender
offer or exchange offer within the meaning of the Securities Exchange Act of
1934, as amended (hereinafter a "tender offer") for Company Stock is commenced
by a person or persons.
In the event a tender offer for Company Stock is commenced,
the Committee as Plan Administrator, promptly after receiving notice of the
commencement of any such tender offer, shall transfer certain of the
Administrator's recordkeeping functions under the Plan to an independent
recordkeeper (which if the Trustee consents in writing, may be the Trustee). The
functions so transferred shall be those necessary to preserve the
confidentiality of any directions given by the Participants (or Beneficiaries)
in connection with the tender offer. The Trustee shall have no discretion or
authority to sell, exchange or transfer any of such shares pursuant to such
tender offer except to the extent, and only to the extent, as provided in this
Plan.
Each Participant (or Beneficiary) is, for purposes of this
subparagraph L-2, hereby designated as a "named fiduciary" (within the meaning
of ERISA) with respect to the shares of Company Stock allocated to his Account,
and shall have the right, to the extent of the number of shares of Company Stock
allocated to his Account, to direct the Trustee (through the independent
recordkeeper) in writing as to the manner in which to respond to a tender offer
with respect to shares of Company Stock. The Company shall use its best efforts
to timely distribute or cause to be distributed to each Participant (or
Beneficiary) such information as will be distributed to stockholders of the
Company in connection with any such tender offer. Upon timely receipt of such
instructions from Participants (or Beneficiaries) through the independent
recordkeeper, the Trustee shall respond as instructed with respect to such
shares of Company Stock (including fractional shares). The instructions from
Participants (or Beneficiaries) received by the Trustee through the independent
recordkeeper shall be held by the Trustee in confidence and shall not be
divulged or released to any person, including the Committee or officers or
employees of the Company or any other Employer. If the Trustee shall shall not
receive timely instruction from a Participant (or Beneficiary) as to the manner
in which to respond to a tender offer, the Trustee shall not tender or exchange
any shares of Company Stock with respect to which such Participant (or
Beneficiary) has the right of direction, and the Trustee shall have no
discretion in such matter.
The independent recordkeeper shall solicit confidentially from
each Participant (or Beneficiary) the directions described in this subparagraph
L-2 as to whether shares are to be tendered. The independent recordkeeper, if
different from the Trustee, shall instruct the Trustee as to the amount of
shares to be tendered, in accordance with the above provisions.
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<PAGE> 49
ARTICLE X
AMENDMENT AND TERMINATION
A. Amendment
To provide for contingencies which may require or make advisable the
clarification, modification or amendment of this Plan, the Company reserves the
right to amend this Plan (and such right is delegated to the Company by all
Employers), at any time and from time to time, in whole or in part, by adopting
such amendment in writing. Moreover, the Committee is authorized and empowered
to amend the Plan from time to time, without Company action or approval, to
conform Plan wording to changes in applicable law or regulations, provide
interpretative clarification and similar actions; provided, however, that any
such amendment shall require the approval of all members of the Committee. The
Company's and the Committee's respective powers to amend include the right,
without limitation, to make retroactive amendments referred to in Section 401(b)
of the Code. However, such right to amend the Plan shall be subject to Paragraph
C of this Article X. Further, no amendment of the Plan shall alter, change or
modify the duties, powers or liabilities of the Trustee without its written
consent.
B. Termination or Complete Discontinuance of Contributions
Although the Employer has established the Plan with the bona fide
intention and expectation that it will be able to make contributions
indefinitely, nevertheless the Employer is not and shall not be under any
obligation or liability whatsoever to continue its contributions or to maintain
the Plan for any given length of time. An Employer may, in its sole and absolute
discretion, discontinue such contributions or terminate the Plan with respect to
its Employees, in accordance with the provisions of the Plan, at any time with
no liability whatsoever for such discontinuance or termination. If the Plan is
terminated or partially terminated, or if contributions of an Employer are
completely discontinued, the rights of all affected Participants in their
Accounts shall thereupon become nonforfeitable, notwithstanding any other
provisions of the Plan. However, the Trust shall continue until all
Participants' Accounts have been completely distributed to or for the benefit of
the Participants, in accordance with the Plan.
C. Nonreversion
1. Except as provided in this subparagraph C-1, the assets of
the Plan shall never inure to the benefit of an Employer; such assets
shall be held for the exclusive purpose of providing benefits to
Participants and their Beneficiaries and for defraying the reasonable
administrative expenses of the Plan.
(a) If an Employer contribution is made by virtue of
a mistake of fact, this Paragraph C shall not prohibit the
return of such contribution to the Employer within one (1)
year after the payment of the contribution.
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<PAGE> 50
(b) If an Employer contribution is made to the Plan
which does not initially qualify under Section 401(a) of the
Code, or any successor provision thereto, then the
contribution shall be returned to the Employer within one (1)
year after the date of denial of qualification of the Plan,
provided that an application for determination is made by the
time prescribed by law for filing the Employer's return for
the taxable year in which the Plan was adopted, or such later
date as the Secretary of the Treasury may prescribe.
(c) If a deduction for an Employer contribution is
disallowed under Section 404 of the Code, or any successor
provision thereto, the contribution shall be returned to the
Employer (to the extent disallowed) within one (1) year after
such disallowance.
2. Neither the Company nor the Committee shall have the right to modify
or amend the Plan retroactively in such a manner so as (i) to reduce the
Participant's vested Account balance, (ii) to reduce the benefits of any
Participant or his Beneficiary accrued under the Plan by reason of contributions
made by an Employer prior to the modification or amendment, or (iii) to
eliminate an optional form of benefit with respect to benefits attributable to
service before the amendment, except to the extent permitted by Section 411
(d)(6) of the Code or Section 204(g) of ERISA and the regulations interpreting
these sections.
ARTICLE XI
MISCELLANEOUS
A. Limitation of Rights; Employment Relationship
Neither the establishment of the Plan and the Trust, nor any
modifications thereof, nor the creation of any fund or account, nor the payment
of any benefits, shall be construed as giving to any Participant or other person
any legal or equitable right against the Employer or the Trustee except as
provided herein; and in no event shall the terms of employment of any Employee
or Participant, express or implied, be modified or in any way be affected
hereby.
B. Transfer of Assets of Employer; Transfer of Assets of Plan
1. If the Employer merges or consolidates with or into a
corporation, or if substantially all of the assets of the Employer are
transferred to another business, the Plan hereby created shall
terminate on the effective date of such merger, consolidation or
transfer. However, if the surviving corporation resulting from such
merger or consolidation, or the business to which the Employer's assets
have been transferred, adopts this Plan, it shall continue and such
corporation or business shall succeed to all rights, powers and duties
of the Employer hereunder. The employment of any Employee who
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<PAGE> 51
continues in the employ of such successor corporation or business shall
not be deemed to have been terminated for any purpose hereunder.
2. In no event shall this Plan be merged or consolidated with
any other plan, nor shall there be any transfer of assets or
liabilities from this Plan to any other plan, unless immediately after
such merger, consolidation or transfer, each Participant's benefits, if
such other plan were then to terminate, are at least equal to or
greater than the benefits to which the Participant would have been
entitled, had this Plan been terminated immediately before such merger,
consolidation, or transfer.
C. Spendthrift Provision
1. Except as otherwise provided in subparagraph 2 hereof,
neither the Employer nor the Trustee shall recognize any transfer,
mortgage, pledge, hypothecation, order, or assignment by any
Participant or Beneficiary of all or part of his interest hereunder,
except a transfer pursuant to a "qualified domestic relations order"
within the meaning of Section 414(p) of the Code. Such interest shall
not otherwise be subject in any manner to transfer by operation of law.
Such interest shall be exempt from the claims of creditors or other
claimants from all orders, decrees, levies, garnishments and/or
executions and other legal or equitable processes or proceedings
against such Participant or Beneficiary to the fullest extent permitted
by law. Upon the Committee's determination that a domestic relations
order constitutes a qualified domestic relations order, benefits shall
be payable in accordance with such order and Section 414(p) of the
Code, including payments prior to the date on which the Participant
attains the "earliest retirement age" under the Plan (as defined in
Section 414(p) of the Code). Plan benefits otherwise payable to or with
respect to the Participant shall be adjusted to reflect payments to the
alternate payee(s) pursuant to the order.
2. If any Employee's participation in the Plan terminates at a
time when he owes money to the Trust, as a result of loans made to him
pursuant to Paragraph I of Article VI, the Committee shall direct
payment to the Trust from the vested portion of his Account, and, if
necessary, the Committee may direct payment from other collateral on
any amount so owing.
D. Applicable Law; Severability
The Plan hereby created shall be construed, administered and governed
in all respects in accordance with ERISA and the laws of the Commonwealth of
Pennsylvania; provided, however, that if any provision of this Plan is
susceptible of more than one interpretation, such interpretation shall be given
thereto as is consistent with the Plan being a qualified employees' profit
sharing plan and a qualified cash or deferred arrangement under the provisions
for qualification set forth in the Code. If any provision of this Plan shall be
held by a court of competent jurisdiction to be invalid or unenforceable, the
remaining provisions shall continue in full force and effect.
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<PAGE> 52
Executed this 27th day of March, 1998.
VF CORPORATION
By: /s/ Louis L.J. Fecile
----------------------------------
Name: Louis L.J. Fecile
Title: Vice President - Employee
Benefits
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<PAGE> 53
VF CORPORATION TAX-ADVANTAGED SAVINGS PLAN
FOR HOURLY EMPLOYEES
APPENDIX A (EMPLOYEES' SAVINGS PLAN OF BASSETT-WALKER, INC. MERGER)
VF Corporation (the "Company") is the plan sponsor of the VF
Corporation Tax-Advantaged Savings Plan for Hourly Employees (the "Plan"). The
Company's indirect wholly-owned subsidiary, VF Knitwear, Inc. (f/k/a
Bassett-Walker, Inc.) ("VF Knitwear"), is the plan sponsor of the Employees'
Savings Plan of Bassett-Walker, Inc. (the "Bassett-Walker Savings Plan").
Pursuant to resolutions of the Executive Committee of the
Company's Board of Directors adopted as of March 17, 1998, and resolutions of VF
Knitwear's Board of Directors adopted as of March 17, 1998:
1. VF Knitwear adopts and becomes a participating
Employer in the Plan effective as of April 1, 1998,
so that Employees of VF Knitwear who satisfy the
eligibility conditions of the Plan are eligible to
participate in the Plan on and after April 1, 1998;
and
2. After giving effect to the merger as of December 31,
1997 of the "salaried" portion of the Bassett-Walker
Savings Plan with and into the VF Corporation
Tax-Advantaged Savings Plan for Salaried Employees,
the Bassett-Walker Savings Plan and the remaining
accounts, assets and liabilities thereunder have been
merged with and into the Plan, effective as
of April 1, 1998.
This Appendix A to the Plan, which is incorporated in and a
part of the Plan, specifies the terms and conditions of the Bassett-Walker
Savings Plan merger with and into the Plan, as follows:
a. Merged Accounts/Vesting. If a VF Knitwear employee was in
active service (including approved leave of absence, sick leave, vacation and
the like) with VF Knitwear (then named "Bassett-Walker, Inc.") as of December
31, 1997, his or her account under the Bassett-Walker Savings Plan became fully
vested and nonforfeitable in connection with the "freezing" of the
Bassett-Walker Savings Plan as of that date, and accordingly such account
following transfer to the Plan in connection with the merger of the
Bassett-Walker Savings Plan with and into the Plan shall be considered 100%
vested and nonforfeitable under this Plan. Other Bassett-Walker Savings Plan
participants' accounts transferred to the Plan shall retain their vested status
as determined under the Bassett-Walker Savings Plan.
b. "After-Tax" Funds. Notwithstanding that Participants are
not permitted to make employee after-tax contributions to the Plan, the Plan
shall accept and hold after-tax
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<PAGE> 54
contributions and amounts attributable thereto (collectively, "after-tax funds")
solely as part of the accounts transferred to the Plan in connection with the
merger of the Bassett-Walker Savings Plan with and into the Plan. The Plan shall
accept and hold no other after-tax funds, except as otherwise specifically
provided in the Plan.
c. Preservation of "Optional Forms of Benefit". It is intended
that all "optional forms of benefit" within the meaning of Section 411(d)(6)(B)
of the Code available under the Bassett-Walker Savings Plan to the accounts
transferred to the Plan in connection with the merger of the Bassett-Walker
Savings Plan with and into the Plan shall be preserved and made available to
such transferred accounts under this Plan. If any such optional form of benefit
is not specified in this Appendix A, the omission shall be considered
inadvertent and such optional form of benefit shall be deemed included herein
and available to the transferred accounts under this Plan. The Plan shall be
construed and administered in accordance with this intention to preserve all
optional forms of benefit. In furtherance of such intention, the Plan shall
apply the optional forms of benefit available under the Bassett-Walker Savings
Plan to the accounts transferred from the Bassett-Walker Savings Plan in
connection with the merger transaction (and solely to those transferred
accounts), including, without limitation, as follows:
i. Normal Form. The normal form of benefit
payments shall be a single sum distribution.
In accordance with Article VI, Subparagraph
A-1(b) of the Plan, the Participant may
elect that the single-sum payment be in
Company common stock up to the number of
full shares then reflected in the portion of
the VF Corporation Stock Fund allocated to
such Participant and the balance in cash, or
a lesser number of shares of Company common
stock and the balance in cash.
ii. Optional Form. In lieu of receiving payment
in a single sum in accordance with clause i.
above, a Participant may elect, in writing
on a form prescribed by the Committee, that
benefit payments be paid in monthly,
quarterly, semi-annual or annual
installments over a period not to exceed the
lesser of ten (10) years or the life
expectancy of the Participant or the life
expectancies of the Participant and
designated Beneficiary.
iii. Withdrawal of Additional Prior After-Tax and
After-Tax Additional Contributions. With
thirty (30) days written notice to the
Committee, a Participant may request a
withdrawal of all or a portion of his or her
account under the Plan transferred from the
Bassett-Walker Savings Plan attributable to
first, his or her additional Prior After-Tax
Contributions (as defined in the Bassett-
Walker Savings Plan) and second, his or her
After-Tax Additional Contributions (as
defined in the Bassett-Walker Savings Plan).
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<PAGE> 55
Payment of such amount shall be in a single
sum as soon as reasonably possible after the
first of the month coincident with or next
following the date the Committee receives
the withdrawal request. Amounts withdrawn
pursuant to this clause iii. may not be
repaid to the Plan.
iv. Withdrawal of Basic Prior After-Tax and
After-Tax Basic Contributions. With thirty
(30) days written notice to the Committee, a
Participant may request a withdrawal of all
or a portion of his or her account under the
Plan transferred from the Bassett-Walker
Savings Plan attributable to first, his or
her basic Prior After-Tax Account (as
defined in the Bassett-Walker Savings Plan)
and second, his or her After-Tax Basic
Account (as defined in the Bassett-Walker
Savings Plan). A withdrawal under this
clause iv. shall not, however, be available
until the Participant has first withdrawn
the entire amount available pursuant to
clause iii. above. Payment of such amount
shall be in a single sum as soon as
reasonably possible after the Committee
receives the withdrawal request. Amounts
withdrawn pursuant to this clause iv. may
not be repaid to the Plan.
* * *
The provisions of the Plan are modified to conform with this
Appendix A, but in all other respects the provisions of the Plan are to be and
shall remain in full force and effect.
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<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 5, 1998, on our audits of the
consolidated financial statements of VF Corporation as of January 3, 1998 and
January 4, 1997, and for each of the three fiscal years in the period ended
January 3, 1998, appearing on page 33 of the 1997 Annual Report to Shareholders,
which is incorporated by reference in the 1997 VF Corporation Annual Report on
Form 10-K. We also consent to the incorporation by reference in this
Registration Statement on Form S-8 of our report dated February 5, 1998 on our
audits of the consolidated financial statement schedule of VF Corporation as of
January 3, 1998 and January 4, 1997, and for each of the three fiscal years in
the period ended January 3, 1998, which report is included in the VF Corporation
1997 Annual Report on Form 10-K.
COOPERS & LYBRAND, L.L.P.
Philadelphia, PA
March 31, 1998
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<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated March 20, 1998 on our audits of the
financial statements of the VF Corporation Tax-Advantaged Savings Plan for
Salaried Employees as of December 31, 1997 and December 31, 1996 and for each of
the three years in the period ended December 31, 1997, which report is included
in the Form 11-K, which is filed as Exhibit 99(A) to the VF Corporation 1997
Annual Report on Form 10-K.
COOPERS & LYBRAND, L.L.P.
Philadelphia, PA
March 31, 1998
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<PAGE> 1
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that the undersigned V.F. Corporation,
a corporation organized and existing under the laws of the Commonwealth of
Pennsylvania ("VF"), and the undersigned directors and officers of VF hereby
constitute and appoint M.J. McDonald and C.S. Cummings, and each of them,
severally, his or her true and lawful attorneys and agents at any time and from
time to time to do any and all acts and things and execute in his or her name
(whether on behalf of VF, or by attesting the seal of VF or otherwise), any and
all instruments and documents which said attorneys and agents, or any of them,
may deem necessary or advisable and may be required to enable VF and the
Tax-Advantaged Savings Plan for Hourly Employees (the "Plan") to comply with the
Securities Act of 1933, as amended, and any rules, regulations or requirements
of the Securities and Exchange Commission ("Commission") in respect thereof, in
connection with the Plan and shares of Common Stock of VF offered pursuant to or
in connection with the Plan, including specifically, but without limiting the
generality of the foregoing, power of attorney to sign the name of VF and affix
the corporate seal and to sign the names of the undersigned directors and
officers to all registration statements, and all amendments and supplements
thereto, on Form S-8 or S-8/S-3 or on any other appropriate Form, hereafter
filed with the Commission and all instruments or documents filed as a part
thereof or in connection therewith, and each of the undersigned hereby ratifies
and confirms all that said attorneys, agents, or any of them, shall do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, each of the undersigned has subscribed to these
presents as of the 30th day of March, 1998.
ATTEST: V.F. CORPORATION
/s/ Candace S. Cummings By: /s/ Mackey J. McDonald
- ----------------------------------- -----------------------------
Candace S. Cummings Mackey J. McDonald
Vice President - Administration, President and Chief
General Counsel and Secretary Executive Officer
Principal Executive Officer: Principal Financial Officer:
/s/ Mackey J. McDonald /s/ Gerard G. Johnson
- ----------------------------------- --------------------------------
Mackey J. McDonald Gerard G. Johnson
President and Chief Vice President - Finance and
Executive Officer Chief Financial Officer
-6-
<PAGE> 2
Principal Accounting Officer:
<TABLE>
<S> <C>
/s/ Robert K. Shearer /s/ Robert D. Buzzell
- -------------------------------------------- --------------------------------
Robert K. Shearer, Vice President - Robert D. Buzzell, Director
Controller
/s/ Edward E. Crutchfield /s/ Ursula F. Fairbairn
- -------------------------------------------- --------------------------------
Edward E. Crutchfield, Director Ursula F. Fairbairn, Director
/s/ Barbara S. Feigin /s/ George Fellows
- -------------------------------------------- --------------------------------
Barbara S. Feigin, Director George Fellows, Director
/s/ Leon C. Holt, Jr. /s/ Robert J. Hurst
- -------------------------------------------- --------------------------------
Leon C. Holt, Jr., Director Robert J. Hurst, Director
/s/ Mackey J. McDonald /s/ William E. Pike
- -------------------------------------------- --------------------------------
Mackey J. McDonald, Director William E. Pike, Director
/s/ Lawrence R. Pugh /s/ M. Rust Sharp
- -------------------------------------------- --------------------------------
Lawrence R. Pugh, Director M. Rust Sharp, Director
/s/ L. Dudley Walker
- --------------------------------------------
L. Dudley Walker, Director
</TABLE>
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