<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON OCTOBER 1, 1999
REGISTRATION NO. -
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------
INTRAWEST CORPORATION
(Exact name of registrant as specified in its charter)
British Columbia, Canada N/A
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Suite 800, 200 Burrard Street
Vancouver, British Columbia, Canada V6C 3L6
(604) 669-9777
(Address, including ZIP code, and telephone number, including
area code, of registrant's principal executive offices)
INTRAWEST 401(K) RETIREMENT PLAN
(Full title of plan)
<TABLE>
<S> <C>
PTSGE Corp. Copies to:
Preston Gates & Ellis LLP Gary J. Kocher
5000 Columbia Center Preston Gates & Ellis LLP
701 Fifth Avenue 5000 Columbia Center
Seattle, Washington 98104-7078 701 Fifth Avenue
(206) 623-7580 Seattle, Washington 98104-7078
(Name, address and telephone number, including (206) 623-7580
area code, of agent for service in the United
States)
</TABLE>
<TABLE>
<CAPTION>
=============================================================================================
Proposed
Maximum Proposed Maximum
offering aggregate
Title of securities Amount to be price per unit offering price Amount of
to be registered registered (1) (2) (2) registration fee
=============================================================================================
<S> <C> <C> <C> <C>
Common Shares,
without par value 30,000 shares $17.00 $510,000 $141.78
=============================================================================================
</TABLE>
In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
this registration statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
(1) Together with an indeterminate number of additional shares which may be
necessary to adjust the number of shares reserved for issuance pursuant
to such plan as the result of any future stock split, stock dividend or
similar adjustment of the outstanding Common Shares of the Registrant.
(2) Estimated solely for the purpose of calculating the registration fee
and, pursuant to Rule 457(c) of the Act, based upon the average high and
low prices of the Common Shares of the Registrant on the New York Stock
Exchange on September 29, 1999.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed with the Securities and
Exchange Commission (the "Commission") by Intrawest Corporation (the "Company")
are incorporated herein by reference:
(a) The Company's Annual Report on Form 40-F for the fiscal year
ended June 30, 1998 filed with the Commission on October 1, 1998, which contains
audited consolidated financial statements for the most recent fiscal year for
which such statements have been filed (the "Annual Report").
(b) All other reports filed pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), since the
end of the fiscal year covered by the Annual Report.
(c) The description of the Company's common shares without par value
(the "Common Shares") that is contained in the Company's Registration Statement
on Form 8-A filed pursuant to Section 12 of the Exchange Act including any
amendment or report filed for the purpose of updating such description.
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14
or 15(d) of the Exchange Act after the date of this Registration Statement and
prior to the filing of a post-effective amendment which indicates that all
securities offered hereby have been sold or which deregisters all securities
then remaining unsold are deemed to be incorporated by reference into this
Registration Statement and to be a part hereof from the respective dates of
filing of such documents.
Any statement contained in an incorporated document shall be deemed to
be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein or in any other subsequently filed
Incorporated Document modifies or supersedes such statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
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<PAGE> 3
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 128 of the Company Act (British Columbia) (the "BCCA") provides:
(1) A company, with the approval of the court, may indemnify a
person who is a director or former director of the company or is
a director or former director of a corporation of which the
company is or was a shareholder, and the person's heirs and
personal representatives, against all costs, charges and
expenses, including an amount paid to settle an action or
satisfy a judgment, actually and reasonably incurred by the
person, including an amount paid to settle an action or satisfy
a judgment in a civil, criminal or administrative action or
proceeding to which the person is made a party because of being
or having been a director, including an action brought by the
company or corporation, if
(a) the person acted honestly and in good faith with a view
to the best interests of the corporation of which the
person is or was a director, and
(b) in the case of a criminal or administrative action or
proceeding, the person had reasonable grounds for
believing that the person's conduct was lawful.
(2) The court, on the application of a company, director or a former
director, may make an order approving an indemnity under this
section, and the court may make any further order it considers
appropriate.
(3) On an application under subsection (2), the court may order
notice to be given to any interested person.
(4) A company may purchase and maintain insurance for the benefit of
a person referred to in this section against any liability
incurred by the person as a director or officer.
(5) Subsections (1) to (3) apply to officers or former officers of a
company or of a corporation of which the company is or was a
shareholder.
The Articles of the Company provide that:
23.1 (1) Subject to the provisions of the Company Act, the
Company shall indemnify a director or former director of
the Company and a director or a former director of a
corporation of which the Company is or was a
shareholder, and the heirs and personal representatives
of any such director or former director, against all
costs, charges and expenses, including an
-2-
<PAGE> 4
amount paid to settle an action or satisfy a judgment,
actually and reasonably incurred by him, including an
amount paid to settle an action or satisfy a judgment in
a civil, criminal or administrative action or proceeding
to which the person is made a party by reason of being
or having been a director of the Company or a director
of such corporation, including any action brought by the
Company or corporation if (a) the person acted honestly
and in good faith with a view to the best interests of
the Company or the corporation of which the person is or
was a director, and (b) in the case of a criminal or
administrative action or proceeding, the person had
reasonable grounds for believing that his conduct was
lawful.
(2) The determination of any action, suit or proceeding by
judgment, order, settlement, conviction or otherwise
shall not, of itself, create a presumption that the
person did not so act or did not have reasonable
grounds, as aforesaid.
(3) Each director of the Company upon being elected or
appointed shall be deemed to have contracted with the
Company on the terms of the foregoing indemnity.
23.2 The Company shall indemnify an officer or former officer of the
Company and an officer or former officer of a corporation of
which the Company is or was a shareholder, and the heirs and
personal representatives of any such officer or former officer,
to the full extent permitted by the Company Act.
23.3 (1) The indemnification provided by this Part shall not be
deemed exclusive of any other rights to which those
seeking indemnification may be entitled under any other
Part, or any valid and lawful agreement, vote of members
or disinterested directors or otherwise, or under the
provisions of any statute now or hereafter existing,
both as to action in the official capacity of such
person and as to action in another capacity while
holding such office, and shall continue as to a person
who has ceased to be a director, officer, employee or
agent and shall enure to the benefit of the heirs and
personal representatives of such person.
(2) The indemnification provided by this Part shall not be
exclusive of any powers, rights, agreements or
undertakings which may be legally permissible or
authorized by or under any applicable law.
(3) Notwithstanding any other provisions set forth in this
Part, the indemnification authorized by this Part shall
be applicable only to the extent that any such
indemnification shall not duplicate indemnity or
reimbursement which that person has received or shall
receive otherwise than under this Part.
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<PAGE> 5
23.4 The directors are authorized from time to time to cause the
Company to give indemnities to any director, officer, employee,
agent or other person who has undertaken or is about to
undertake any liability on behalf of the Company or any
corporation of which it is a shareholder.
A policy of directors' and officers' liability insurance is maintained
by the Company which insures directors and officers for losses as a result of
claims against the directors and officers of the Company in their capacity as
directors and officers and also reimburses the Company for payments made
pursuant to the indemnity provisions under the Articles and the BCCA.
Insofar as indemnification for liabilities under the Securities Act of
1933 (the "Securities Act") may be permitted to directors, officers or persons
controlling the Company pursuant to the foregoing provisions, the Company has
been advised that in the opinion of the Commission such indemnification is
against public policy in the United States as expressed in the Securities Act
and is therefore unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
EXHIBIT DESCRIPTION
------- -----------
4.1 -- Intrawest 401(k) Retirement Plan
5.1 -- Opinion of McCarthy Tetrault
23.1 -- Consent of McCarthy Tetrault (see Exhibit 5.1)
23.2 -- Consent of KPMG, Independent Auditors
The undersigned registrant hereby undertakes to submit the Plan and any
amendments thereto to the Internal Revenue Service (the "IRS") in a timely
manner and that the registrant will make all changes required by the IRS in
order to qualify the plan under section 401 of the Internal Revenue Code and to
maintain such qualification.
-4-
<PAGE> 6
ITEM 9. UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement 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.
(2) That, for purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933, each filing of
the registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) 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> 7
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 authorized and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized in the City of Vancouver, Province of
British Columbia, Country of Canada, on this 30th day of September, 1999.
INTRAWEST CORPORATION
By /s/ JOE S. HOUSSIAN
-------------------------------------------
Name: Joe S. Houssian
Title: Chairman, 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 indicated on this 30th day of September, 1999.
<TABLE>
<CAPTION>
SIGNATURE TITLE
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<S> <C>
Chairman, President and Chief Executive
/s/ JOE S. HOUSSIAN Officer (Principal Executive Officer)
- --------------------------------------
Joe S. Houssian
Executive Vice President and Chief
/s/ DANIEL O. JARVIS Financial Officer and Director
- -------------------------------------- (Principal Financial Officer)
Daniel O. Jarvis
Corporate Controller
/s/ DAVID C. BLAIKLOCK (Principal Accounting Officer)
- --------------------------------------
David C. Blaiklock
Director
- --------------------------------------
R. Thomas M. Allan
/s/ DAVID A. KING Director
- --------------------------------------
David A. King
Director
- --------------------------------------
Gordon H. MacDougall
/s/ PAUL M. MANHEIM Director
- --------------------------------------
Paul M. Manheim
Director
- --------------------------------------
Paul A. Novelly
/s/ BERNARD A. ROY Director
- --------------------------------------
Bernard A. Roy
/s/ KHALED C. SIFRI Director
- --------------------------------------
Khaled C. Sifri
/s/ HUGH R. SMYTHE Director
- --------------------------------------
Hugh R. Smythe
/s/ NICHOLAS C. H. VILLIERS Director
- --------------------------------------
Nicholas C. H. Villiers
/s/ GARY RAYMOND Director
- --------------------------------------
Gary Raymond
</TABLE>
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<PAGE> 8
INDEX TO EXHIBITS TO REGISTRATION STATEMENT ON FORM S-8
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION PAGE
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<S> <C> <C>
4.1 -- Intrawest 401(k) Retirement Plan
5.1 -- Opinion of McCarthy Tetrault
23.1 -- Consent of McCarthy Tetrault (see Exhibit 5.1)
23.2 -- Consent of KPMG, Independent Auditors
</TABLE>
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<PAGE> 1
EXHIBIT 4.1
INTRAWEST 401(k)
RETIREMENT PLAN
<PAGE> 2
Table of Contents
<TABLE>
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Page
<S> <C> <C>
ARTICLE I
DEFINITIONS
ARTICLE II
ADMINISTRATION
2.1 POWERS AND RESPONSIBILITIES OF THE EMPLOYER.........................15
2.2 DESIGNATION OF ADMINISTRATIVE AUTHORITY.............................15
2.3 POWERS AND DUTIES OF THE ADMINISTRATOR..............................15
2.4 RECORDS AND REPORTS.................................................17
2.5 APPOINTMENT OF ADVISERS.............................................17
2.6 PAYMENT OF EXPENSES.................................................17
2.7 CLAIMS PROCEDURE....................................................17
2.8 CLAIMS REVIEW PROCEDURE.............................................18
ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY...........................................18
3.2 EFFECTIVE DATE OF PARTICIPATION.....................................18
3.3 DETERMINATION OF ELIGIBILITY........................................19
3.4 TERMINATION OF ELIGIBILITY..........................................19
3.5 ELECTION NOT TO PARTICIPATE.........................................19
ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER CONTRIBUTION.......................19
4.2 PARTICIPANT'S SALARY REDUCTION ELECTION.............................20
4.3 TIME OF PAYMENT OF EMPLOYER CONTRIBUTION............................23
4.4 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS................23
4.5 ACTUAL DEFERRAL PERCENTAGE TESTS....................................26
4.6 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS......................28
4.7 ACTUAL CONTRIBUTION PERCENTAGE TESTS................................29
4.8 ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS..................31
4.9 MAXIMUM ANNUAL ADDITIONS............................................32
4.10 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS...........................35
4.11 TRANSFERS FROM QUALIFIED PLANS......................................36
4.12 VOLUNTARY CONTRIBUTIONS.............................................37
4.13 DIRECTED INVESTMENT ACCOUNT.........................................38
ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND.........................................39
5.2 METHOD OF VALUATION.................................................39
</TABLE>
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<PAGE> 3
<TABLE>
<S> <C> <C>
ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT...........................40
6.2 DETERMINATION OF BENEFITS UPON DEATH................................40
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY....................41
6.4 DETERMINATION OF BENEFITS UPON TERMINATION..........................41
6.5 DISTRIBUTION OF BENEFITS............................................45
6.6 DISTRIBUTION OF BENEFITS UPON DEATH.................................50
6.7 TIME OF SEGREGATION OR DISTRIBUTION.................................53
6.8 DISTRIBUTION FOR MINOR BENEFICIARY..................................53
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN......................53
6.10 PRE-RETIREMENT DISTRIBUTION.........................................54
6.11 ADVANCE DISTRIBUTION FOR HARDSHIP...................................54
6.12 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION.....................55
ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE...............................56
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE.........................57
7.3 OTHER POWERS OF THE TRUSTEE.........................................58
7.4 LOANS TO PARTICIPANTS...............................................60
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS............................61
7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES.......................62
7.7 ANNUAL REPORT OF THE TRUSTEE........................................62
7.8 AUDIT...............................................................62
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE......................63
7.10 TRANSFER OF INTEREST................................................64
7.11 DIRECT ROLLOVER.....................................................64
7.12 EMPLOYER SECURITIES AND REAL PROPERTY...............................65
ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS
8.1 AMENDMENT...........................................................65
8.2 TERMINATION.........................................................66
8.3 MERGER OR CONSOLIDATION.............................................66
ARTICLE IX
TOP HEAVY
9.1 TOP HEAVY PLAN REQUIREMENTS.........................................66
9.2 DETERMINATION OF TOP HEAVY STATUS...................................66
ARTICLE X
MISCELLANEOUS
10.1 PARTICIPANT'S RIGHTS................................................69
10.2 ALIENATION..........................................................69
10.3 CONSTRUCTION OF PLAN................................................70
10.4 GENDER AND NUMBER...................................................70
</TABLE>
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<TABLE>
<S> <C> <C>
10.5 LEGAL ACTION........................................................71
10.6 PROHIBITION AGAINST DIVERSION OF FUNDS..............................71
10.7 BONDING.............................................................71
10.8 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE..........................71
10.9 INSURER'S PROTECTIVE CLAUSE.........................................72
10.10 RECEIPT AND RELEASE FOR PAYMENTS....................................72
10.11 ACTION BY THE EMPLOYER..............................................72
10.12 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY..................72
10.13 HEADINGS............................................................73
10.14 APPROVAL BY INTERNAL REVENUE SERVICE................................73
10.15 UNIFORMITY..........................................................73
ARTICLE XI
PARTICIPATING EMPLOYERS
11.1 ADOPTION BY OTHER EMPLOYERS.........................................74
11.2 REQUIREMENTS OF PARTICIPATING EMPLOYERS.............................74
11.3 DESIGNATION OF AGENT................................................75
11.4 EMPLOYEE TRANSFERS..................................................75
11.5 PARTICIPATING EMPLOYER CONTRIBUTION.................................75
11.6 AMENDMENT...........................................................75
11.7 DISCONTINUANCE OF PARTICIPATION.....................................75
11.8 ADMINISTRATOR'S AUTHORITY...........................................76
</TABLE>
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<PAGE> 5
INTRAWEST 401(k) RETIREMENT PLAN
THIS AGREEMENT, is hereby made and entered into this 31st day of
October, 1997, by and between The Stratton Corporation (herein referred
to as the "Employer") and Robert A. Fries, Carl S. Williams, and Michael P.
Moran (herein referred to as the "Trustee").
WITNESSETH:
WHEREAS, The Stratton Corporation heretofore established a Profit
Sharing Plan and Trust effective June 30, 1978, (hereinafter called the
"Effective Date") known as Stratton Corporation Employees' 401(k) Savings &
Sales Incentive Plan and which plan shall hereafter be known as Intrawest 401(k)
Retirement Plan (herein referred to as the "Plan"), and effective January 1,
1998 shall be sponsored by Intrawest U.S. Holdings Inc. ("Employer" effective
January 1, 1998), in recognition of the contribution made to its successful
operation by its employees and for the exclusive benefit of its eligible
employees; and
WHEREAS, under the terms of the Plan, the Employer has the ability to
amend the Plan, provided the Trustee joins in such amendment if the provisions
of the Plan affecting the Trustee are amended;
NOW, THEREFORE, effective January 1, 1997, except as otherwise provided,
the Employer and the Trustee in accordance with the provisions of the Plan
pertaining to amendments thereof, hereby amend the Plan in its entirety and
restate the Plan to provide as follows:
ARTICLE I
DEFINITIONS
1.1 "Act" means the Employee Retirement Income Security Act of 1974, as
it may be amended from time to time.
1.2 "Administrator" means the Employer unless another person or entity
has been designated by the Employer pursuant to Section 2.2 to administer the
Plan on behalf of the Employer.
1.3 "Affiliated Employer" means any corporation which is a member of a
controlled group of corporations (as defined in Code Section 414(b)) which
includes the Employer; any trade or business (whether or not incorporated) which
is under common control (as defined in Code Section 414(c)) with the Employer;
any organization (whether or not incorporated) which is a member of an
affiliated service group (as defined in Code Section 414(m)) which includes the
Employer; and any other entity required to be aggregated with the Employer
pursuant to Regulations under Code Section 414(o).
<PAGE> 6
1.4 "Aggregate Account" means, with respect to each Participant, the
value of all accounts maintained on behalf of a Participant, whether
attributable to Employer or Employee contributions, subject to the provisions of
Section 9.2.
1.5 "Anniversary Date" means December 31.
1.6 "Annuity Starting Date" means, with respect to any Participant, the
first day of the first period for which an amount is paid as an annuity or any
other form.
1.7 "Beneficiary" means the person to whom the share of a deceased
Participant' total account is payable, subject to the restrictions of Sections
6.2 and 6.6.
1.8 "Code" means the Internal Revenue Code of 1986, as amended or
replaced from time to time.
1.9 "Compensation" with respect to any Participant means such
Participant's wages, salaries, fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash) for
personal services actually rendered in the course of employment with the
Employer maintaining the Plan to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid 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 Regulation
1.62-2(c)) for a Plan Year.
Compensation shall exclude (a)(1) contributions made by the Employer to
a plan of deferred compensation to the extent that, the contributions are not
includible in the gross income of the Participant for the taxable year in which
contributed, (2) Employer contributions made on behalf of an Employee to a
simplified employee pension plan described in Code Section 408(k) to the extent
such contributions are excludable from the Employee's gross income, (3) any
distributions from a plan of deferred compensation; (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; (c) amounts realized from the sale,
exchange or other disposition of stock acquired under a qualified stock option;
and (d) other amounts which receive special tax benefits, or contributions made
by the Employer (whether or not under a salary reduction agreement) towards the
purchase of any annuity contract described in Code Section 403(b) (whether or
not the contributions are actually excludable from the gross income of the
Employee).
For purposes of this Section, the determination of Compensation shall be
made by:
(a) including amounts which are contributed by the Employer
pursuant to a salary reduction agreement and which are not includible in the
gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.
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<PAGE> 7
For a Participant's initial year of participation, Compensation shall be
recognized as of such Employee's effective date of participation pursuant to
Section 3.2.
Compensation in excess of $150,000 shall be disregarded. Such amount
shall be adjusted for increases in the cost of living in accordance with Code
Section 401(a)(17), except that the dollar increase in effect on January 1 of
any calendar year shall be effective for the Plan Year beginning with or within
such calendar year. For any short Plan Year the Compensation limit shall be an
amount equal to the Compensation limit for the calendar year in which the Plan
Year begins multiplied by the ratio obtained by dividing the number of full
months in the short Plan Year by twelve (12).
For purposes of this Section, if the Plan is a plan described in Code
Section 413(c) or 414(0 (a plan maintained by more than one Employer), the
limitation applies separately with respect to the Compensation of any
Participant from each Employer maintaining the Plan.
If, in connection with the adoption of this amendment and restatement,
the definition of Compensation has been modified, then, for Plan Years prior to
the Plan Year which includes the adoption date of this amendment and
restatement, Compensation means compensation determined pursuant to the Plan
then in effect.
1.10 "Contract" or "Policy" means any life insurance policy, retirement
income or annuity policy, or annuity contract (group or individual) issued
pursuant to the terms of the Plan.
1.11 "Deferred Compensation" with respect to any Participant means the
amount of the Participant's total Compensation which has been contributed to the
Plan in accordance with the Participant's deferral election pursuant to Section
4.2 excluding any such amounts distributed as excess "annual additions" pursuant
to Section 4.10(a).
1.12 "Designated Investment Alternative" means a specific investment
identified by name by a Fiduciary as an available investment under the Plan
which may be acquired or disposed of by the Trustee pursuant to the investment
direction by a Participant.
1.13 "Directed Investment Option" means one or more of the following:
(a) a Designated Investment Alternative.
(b) any other investment permitted by the Plan and the
Participant Direction Procedures and acquired or disposed of by the Trustee
pursuant to the investment direction of a Participant.
1.14 "Early Retirement Date" means the first day of the month (prior to
the Normal Retirement Date) coinciding with or following the date on which a
Participant or Former Participant attains age 55. A Participant shall become
fully Vested upon satisfying this requirement if still employed at his Early
Retirement Age.
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<PAGE> 8
A Former Participant who terminates employment and who thereafter
reaches the age requirement contained herein shall be entitled to receive his
benefits under this Plan.
1.15 "Elective Contribution" means the Employer contributions to the
Plan of Deferred Compensation excluding any such amounts distributed as excess
"annual additions" pursuant to Section 4.10(a). In addition, any Employer
Qualified Non-Elective Contribution made pursuant to Section 4.1(c) and Section
4.6(b) which is used to satisfy the "Actual Deferral Percentage" tests shall be
considered an Elective Contribution for purposes of the Plan. Any contributions
deemed to be Elective Contributions (whether or not used to satisfy the "Actual
Deferral Percentage" tests) shall be subject to the requirements of Sections
4.2(b) and 4.2(c) and shall further be required to satisfy the nondiscrimination
requirements of Regulation 1.401(k)-l(b)(5), the provisions of which are
specifically incorporated herein by reference.
1.16 "Eligible Employee" means any Employee.
Employees who are Leased Employees within the meaning of Code Sections
414(n)(2) and 414(o)(2) shall not be eligible to participate in this Plan.
Employees whose employment is governed by the terms of a collective
bargaining agreement between Employee representatives (within the meaning of
Code Section 7701(a)(46)) and the Employer under which retirement benefits were
the subject of good faith bargaining between the parties will not be eligible to
participate in this Plan.
Employees of Affiliated Employers shall not be eligible to participate
in this Plan unless such Affiliated Employers have specifically adopted this
Plan in writing.
1.17 "Employee" means any person who is employed by the Employer or
Affiliated Employer. Employee shall include Leased Employees within the meaning
of Code Sections 414(n)(2) and 414(o)(2) unless such Leased Employees are
covered by a plan described in Code Section 414(n)(5) and such Leased Employees
do not constitute more than 20% of the recipient's non-highly compensated work
force. Employee shall exclude any person who is classified as an independent
contractor by the Employer (even if such classification is not recognized by the
Internal Revenue Service).
1.18 "Employer" means The Stratton Corporation and any successor which
shall maintain this Plan; and any predecessor which has maintained this Plan.
The Employer is a corporation, with principal offices in the State of Vermont.
Effective January 1, 1998, Employer means Intrawest U.S. Holdings Inc.
and any successor which shall maintain this Plan; and any predecessor which has
maintained this Plan. The Employer is a corporation, with principal offices in
the State of Colorado.
In addition, where appropriate, the term Employer shall include any
Participating Employer (as defined in Section 11.1) which shall adopt this Plan.
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1.19 "Excess Aggregate Contributions" means, with respect to any Plan
Year, the excess of the aggregate amount of the Employer matching contributions
made pursuant to Section 4.1 (b) and any qualified non-elective contributions or
elective deferrals taken into account pursuant to Section 4.7(c) on behalf of
Highly Compensated Participants for such Plan Year, over the maximum amount of
such contributions permitted under the limitations of Section 4.7(a) (determined
by reducing contributions made on behalf of Highly Compensated Participants in
order of their contribution percentages beginning with the highest of such
percentages).
1.20 "Excess Contributions" means, with respect to a Plan Year, the
excess of Elective Contributions used to satisfy the "Actual Deferral
Percentage" tests made on behalf of Highly Compensated Participants for the Plan
Year over the maximum amount of such contributions permitted under Section
4.5(a) (determined by reducing contributions made on behalf of Highly
Compensated Participants in order of the actual deferral percentages beginning
with the highest of such percentages). Excess Contributions shall be treated as
an "annual addition" pursuant to Section 4.9(b).
1.21 "Excess Deferred Compensation" means, with respect to any taxable
year of a Participant, the excess of the aggregate amount of such Participant's
Deferred Compensation and the elective deferrals pursuant to Section 4.2(f)
actually made on behalf of such Participant for such taxable year, over the
dollar limitation provided for in Code Section 402(g), which is incorporated
herein by reference. Excess Deferred Compensation shall be treated as an "annual
addition" pursuant to Section 4.9(b) when contributed to the Plan unless
distributed to the affected Participant not later than the first April 15th
following the close of the Participant's taxable year. Additionally, for
purposes of Sections 9.2 and 4.4(g), Excess Deferred Compensation shall continue
to be treated as Employer contributions even if distributed pursuant to Section
4.2(f). However, Excess Deferred Compensation of Non-Highly Compensated
Participants is not taken into account for purposes of Section 4.5(a) to the
extent such Excess Deferred Compensation occurs pursuant to Section 4.2(d).
1.22 "Fiduciary" means any person who (a) exercises any discretionary
authority or discretionary control respecting management of the Plan or
exercises any authority or control respecting management or disposition of its
assets, (b) renders investment advice for a fee or other compensation, direct or
indirect, with respect to any monies or other property of the Plan or has any
authority or responsibility to do so, or (c) has any discretionary authority or
discretionary responsibility in the administration of the Plan, including, but
not limited to, the Trustee, the Employer and its representative body, and the
Administrator.
1.23 "Fiscal Year" means the Employer's accounting year of 12 months
commencing on July 1st of each year and ending the following June 30th.
1.24 "Forfeiture" means that portion of a Participant's Account that is
not Vested, and occurs on the earlier of:
(a) the distribution of the entire Vested portion of a
Terminated Participant's Account, or
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(b) the last day of the Plan Year in which the Participant
incurs five (5) consecutive 1-Year Breaks in Service.
Furthermore, for purposes of paragraph (a) above, in the case of a
Terminated Participant whose Vested benefit is zero, such Terminated Participant
shall be deemed to have received a distribution of his Vested benefit upon his
termination of employment. Restoration of such amounts shall occur pursuant to
Section 6.4(g)(2). In addition, the term Forfeiture shall also include amounts
deemed to be Forfeitures pursuant to any other provision of this Plan.
1.25 "Former Participant" means a person who has been a Participant, but
who has ceased to be a Participant for any reason.
1.26 "415 Compensation" with respect to any Participant means such
Participant's wages, salaries, fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash) for
personal services actually rendered in the course of employment with the
Employer maintaining the Plan to the extent that the amounts are includible in
gross income (including, but not limited to, commissions paid 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 Regulation
1.62-2(c)) for a Plan Year.
"415 Compensation" shall exclude (a)(1) contributions made by the
Employer to a plan of deferred compensation to the extent that, the
contributions are not includible in the gross income of the Participant for the
taxable year in which contributed, (2) Employer contributions made on behalf of
an Employee to a simplified employee pension plan described in Code Section
408(k) to the extent such contributions are excludable from the Employee's gross
income, (3) any distributions from a plan of deferred compensation; (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; (c) amounts realized from
the sale, exchange or other disposition of stock acquired under a qualified
stock option; and (d) other amounts which receive special tax benefits, or
contributions made by the Employer (whether or not under a salary reduction
agreement) towards the purchase of any annuity contract described in Code
Section 403(b) (whether or not the contributions are actually excludable from
the gross income of the Employee).
For Plan Years beginning after December 31, 1997, for purposes of this
Section, the determination of "415 Compensation" shall be made by including
amounts which are contributed by the Employer pursuant to a salary reduction
agreement and which are not includible in the gross income of the Participant
under Code Sections 125, 402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and Employee
contributions described in Code Section 414(h)(2) that are treated as Employer
contributions.
If, in connection with the adoption of this amendment and restatement,
the definition of "415 Compensation" has been modified, then, for Plan Years
prior to the Plan Year which
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includes the adoption date of this amendment and restatement, "415 Compensation"
means compensation determined pursuant to the Plan then in effect.
1.27 "414(s) Compensation" with respect to any Participant means such
Participant's "415 Compensation" paid during a Plan Year. The amount of "414(s)
Compensation" with respect to any Participant shall include "414(s)
Compensation" for the entire twelve (12) month period ending on the last day of
such Plan Year, except that "414(s) Compensation" shall only be recognized for
that portion of the Plan Year during which an Employee was a Participant in the
Plan.
For purposes of this Section, the determination of "414(s) Compensation"
shall be made by including amounts which are contributed by the Employer
pursuant to a salary reduction agreement and which are not includible in the
gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.
"414(s) Compensation" in excess of $150,000 shall be disregarded. Such
amount shall be adjusted for increases in the cost of living in accordance with
Code Section 401(a)(17), except that the dollar increase in effect on January 1
of any calendar year shall be effective for the Plan Year beginning with or
within such calendar year. For any short Plan Year the "414(s) Compensation"
limit shall be an amount equal to the "414(s) Compensation" limit for the
calendar year in which the Plan Year begins multiplied by the ratio obtained by
dividing the number of full months in the short Plan Year by twelve (12).
If, in connection with the adoption of this amendment and restatement,
the definition of "414(s) Compensation" has been modified, then, for Plan Years
prior to the Plan Year which includes the adoption date of this amendment and
restatement, "414(s) Compensation" means compensation determined pursuant to the
Plan then in effect.
1.28 "Highly Compensated Employee" means an Employee described in Code
Section 414(q) and the Regulations thereunder, and generally means an Employee
who performed services for the Employer during the "determination year" and is
in one or more of the following groups:
(a) Employees who at any time during the "determination year"
or "look-back year" were "five percent owners" as defined in Section 1.35(c).
(b) Employees who received "415 Compensation" during the
"look-back year" from the Employer in excess of $80,000 and, to the extent
elected by the Employer, were in the Top Paid Group of Employees during the
"look-back year."
The "determination year" shall be the Plan Year for which testing is
being performed, and the "look-back year" shall be the immediately preceding
twelve-month period.
For purposes of this Section, the determination of "415 Compensation"
shall be made by including amounts which are contributed by the Employer
pursuant to a salary reduction
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<PAGE> 12
agreement and which are not includible in the gross income of the Participant
under Code Sections 125,402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and Employee
contributions described in Code Section 414(h)(2) that are treated as Employer
contributions. Additionally, the dollar threshold amount specified in (b) above
shall be adjusted at such time and in the same manner as under Code Section
415(d), except that the base period shall be the calendar quarter ending
September 30, 1996. In the case of such an adjustment, the dollar limit which
shall be applied is the limit for the calendar year in which the "look-back
year" begins.
1.29 "Highly Compensated Participant" means any Highly Compensated
Employee who is eligible to participate in the Plan.
1.30 "Hour of Service" means (1) each hour for which an Employee is
directly or indirectly compensated or entitled to compensation by the Employer
for the performance of duties (these hours will be credited to the Employee for
the computation period in which the duties are performed); (2) each hour for
which an Employee is directly or indirectly compensated or entitled to
compensation by the Employer (irrespective of whether the employment
relationship has terminated) for reasons other than performance of duties (such
as vacation, holidays, sickness, jury duty, disability, lay-off, military duty
or leave of absence) during the applicable computation period (these hours will
be calculated and credited pursuant to Department of Labor regulation
2530.200b-2 which is incorporated herein by reference); (3) each hour for which
back pay is awarded or agreed to by the Employer without regard to mitigation of
damages (these hours will be credited to the Employee for the computation period
or periods to which the award or agreement pertains rather than the computation
period in which the award, agreement or payment is made). The same Hours of
Service shah not be credited both under (1) or (2), as the case may be, and
under (3).
Notwithstanding the above, (i) no more than 501 Hours of Service are
required to be credited to an Employee on account of any single continuous
period during which the Employee performs no duties (whether or not such period
occurs in a single computation period); (ii) an hour for which an Employee is
directly or indirectly paid, or entitled to payment, on account of a period
during which no duties are performed is not required to be credited to the
Employee if such payment is made or due under a plan maintained solely for the
purpose of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws; and (iii) Hours of Service are not
required to be credited for a payment which solely reimburses an Employee for
medical or medically related expenses incurred by the Employee.
For purposes of this Section, a payment shall be deemed to be made by or
due from the Employer regardless of whether such payment is made by or due from
the Employer directly, or indirectly through, among others, a trust fund, or
insurer, to which the Employer contributes or pays premiums and regardless of
whether contributions made or due to the trust fund, insurer, or other entity
are for the benefit of particular Employees or are on behalf of a group of
Employees in the aggregate.
For purposes of this Section, Hours of Service will be credited for
employment with other Affiliated Employers. The provisions of Department of
Labor regulations 2530.200b-2(b) and (c) are incorporated herein by reference.
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<PAGE> 13
1.31 "Income" means the `income or losses allocable to Excess Deferred
Compensation, Excess Contributions or Excess Aggregate Contributions which
amount shall be allocated in the same manner as income or losses are allocated
pursuant to Section 4.4(0.
1.32 "Investment Manager" means an entity that (a) has the power to
manage, acquire, or dispose of Plan assets and (b) acknowledges fiduciary
responsibility to the Plan in writing. Such entity must be a person, firm, or
corporation registered as an investment adviser under the Investment Advisers
Act of 1940, a bank, or an insurance company.
1.33 "Key Employee" means an Employee as defined in Code Section 416(i)
and the Regulations thereunder. Generally, any Employee or former Employee (as
well as each of his Beneficiaries) is considered a Key Employee if he, at any
time during the Plan Year that contains the "Determination Date" or any of the
preceding four (4) Plan Years, has been included in one of the following
categories:
(a) an officer of the Employer (as that term is defined within
the meaning of the Regulations under Code Section 416) having annual "415
Compensation" greater than 50 percent of the amount in effect under Code Section
415 (b) (1) (a) for any such Plan Year.
(b) one of the ten employees having annual "415 Compensation"
from the Employer for a Plan Year greater than the dollar limitation in effect
under Code Section 415(c)(1)(a) for the calendar year in which such Plan Year
ends and owning (or considered as owning within the meaning of Code Section 318)
both more than one-half percent interest and the largest interests in the
Employer.
(c) a "five percent owner" of the Employer. "Five percent
owner" means any person who owns (or is considered as owning within the meaning
of Code Section 318) more than five percent (5%) of the outstanding stock of the
Employer or stock possessing more than five percent (5%) of the total combined
voting power of all stock of the Employer or, in the case of an unincorporated
business, any person who owns more than five percent (5%) of the capital or
profits interest in the Employer. In determining percentage ownership hereunder,
employers that would otherwise be aggregated under Code Sections 414(b), (c),
(m) and (o) shall be treated as separate employers.
(d) a "one percent owner" of the Employer having an annual
"415 Compensation" from the Employer of more than $150,000. "One percent owner"
means any person who owns (or is considered as owning within the meaning of Code
Section 318) more than one percent (1%) of the outstanding stock of the Employer
or stock possessing more than one percent (1%) of the total combined voting
power of all stock of the Employer or, in the case of an unincorporated
business, any person who owns more than one percent (1%) of the capital or
profits interest in the Employer. In determining percentage ownership hereunder,
employers that would otherwise be aggregated under Code Sections 414(b), (c),
(m) and (o) shall be treated as separate employers. However, in determining
whether an individual has "415 Compensation" of more than $150,000, "415
Compensation" from each employer required to be aggregated under Code Sections
414(b), (c), (m) and (o) shall be taken into account.
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<PAGE> 14
For purposes of this Section, the determination of "415 Compensation"
shall be made by including amounts which are contributed by the Employer
pursuant to a salary reduction agreement and which are not includible in the
gross income of the Participant under Code Sections 125, 402(e)(3),
402(h)(1)(B), 403(b) or 457(b), and Employee contributions described in Code
Section 414(h)(2) that are treated as Employer contributions.
1.34 "Late Retirement Date" means the first day of the month coinciding
with or next following a Participant's actual Retirement Date after having
reached his Normal Retirement Date.
1.35 "Leased Employee" means any person (other than an Employee of the
recipient) who pursuant to an agreement between the recipient and any other
person ("leasing organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with Code Section
414(n)(6)) on a substantially full time basis for a period of at least one year,
and such services are performed under primary direction or control by the
recipient. Contributions or benefits provided a Leased Employee by the leasing
organization which are attributable to services performed for the recipient
employer shall be treated as provided by the recipient employer. A Leased
Employee shall not be considered an Employee of the recipient:
(a) if such employee is covered by a money purchase pension
plan providing:
(1) a non-integrated employer contribution rate of at
least 10% of compensation, as defined in Code Section 415(c)(3), but including
amounts which are contributed by the Employer pursuant to a salary reduction
agreement and which are not includible in the gross income of the Participant
under Code Sections 125,402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and Employee
contributions described in Code Section 414(h)(2) that are treated as Employer
contributions.
(2) immediate participation; and
(3) full and immediate vesting; and
(b) if Leased Employees do not constitute more than 20% of the
recipient's non-highly compensated work force.
1.36 "Non-Elective Contribution" means the Employer contributions to the
Plan excluding, however, contributions made pursuant to the Participant's
deferral election provided for in Section 4.2 and any Qualified Non-Elective
Contribution used in the "Actual Deferral Percentage" tests.
1.37 "Non-Highly Compensated Participant" means any Participant who is
not a Highly Compensated Employee.
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1.38 "Non-Key Employee" means any Employee or former Employee (and his
Beneficiaries) who is not a Key Employee.
1.39 "Normal Retirement Age" means the Participant's 65th birthday. A
Participant shall become fully Vested in his Participant's Account upon
attaining his Normal Retirement Age.
1.40 "Normal Retirement Date" means the first day of the month
coinciding with or next following the Participant's Normal Retirement Age.
1.41 "1-Year Break in Service" means the applicable computation period
during which an Employee has not completed more than 500 Hours of Service with
the Employer. Further, solely for the purpose of determining whether a
Participant has incurred a 1-Year Break in Service, Hours of Service shall be
recognized for "authorized leaves of absence" and "maternity and paternity
leaves of absence." Years of Service and 1-Year Breaks in Service shall be
measured on the same computation period.
"Authorized leave of absence" means an unpaid, temporary cessation from
active employment with the Employer pursuant to an established nondiscriminatory
policy, whether occasioned by illness, military service, or any other reason.
A "maternity or paternity leave of absence" means, for Plan Years
beginning after December 31, 1984, an absence from work for any period by reason
of the Employee's pregnancy, birth of the Employee's child, placement of a child
with the Employee in connection with the adoption of such child, or any absence
for the purpose of caring for such child for a period immediately following such
birth or placement. For this purpose, Hours of Service shall be credited for the
computation period in which the absence from work begins, only if credit
therefore is necessary to prevent the Employee from incurring a 1-Year Break in
Service, or, in any other case, in the immediately following computation period.
The Hours of Service credited for a "maternity or paternity leave of absence"
shall be those which would normally have been credited but for such absence, or,
in any case in which the Administrator is unable to determine such hours
normally credited, eight (8)Hours of Service per day. The total Hours of Service
required to be credited for a "maternity or paternity leave of absence" shall
not exceed 501.
1.42 "Participant" means any Eligible Employee who participates in the
Plan and has not for any reason become ineligible to participate further in the
Plan.
1.43 "Participant Direction Procedures" means such instructions,
guidelines or policies, the terms of which are incorporated herein, as shall be
established pursuant to Section 4.13 and observed by the Administrator and
applied and provided to Participants who have Participant Directed Accounts.
1.44 "Participant's Account" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan and Trust resulting from the Employer Non-Elective
Contributions.
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A separate accounting shall be maintained with respect to that portion
of the Participant's Account attributable to Employer matching contributions
made pursuant to Section 4.1 (b), Employer discretionary contributions made
pursuant to Section 4.1 (d) and any Employer Qualified Non-Elective
Contributions.
1.45 "Participant's Combined Account" means the total aggregate amount
of each Participant's Elective Account and Participant's Account.
1.46 "Participant's Directed Account" means that portion of a
Participant's interest in the Plan with respect to which the Participant has
directed the investment in accordance with the Participant Direction Procedure.
1.47 "Participant's Elective Account" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan and Trust resulting from the Employer Elective
Contributions used to satisfy the "Actual Deferral Percentage" tests. A separate
accounting shall be maintained with respect to that portion of the Participant's
Elective Account attributable to such Elective Contributions pursuant to Section
4.2 and any Employer Qualified Non-Elective Contributions.
1.48 "Plan" means this instrument, including all amendments thereto.
1.49 "Plan Year" means the Plan's accounting year of twelve (12) months
commencing on January 1st of each year and ending the following December 31st.
1.50 "Pre-Retirement Survivor Annuity" means a death benefit which is an
immediate annuity for the life of the Participant's spouse the payments under
which must be equal to the amount of benefit which can be purchased with 50% of
the accounts of a Participant.
A proportionate share of each of the Participant's accounts shall be
used to provide the Pre-Retirement Survivor Annuity.
1.51 "Qualified Non-Elective Contribution" means any Employer
contributions made pursuant to Section 4. l(c) and Section 4.6(b) and Section
4.8(h). Such contributions shall be considered an Elective Contribution for the
purposes of the Plan and may be used to satisfy the "Actual Deferral Percentage"
tests or the "Actual Contribution Percentage" tests.
1.52 "Regulation" means the Income Tax Regulations as promulgated by the
Secretary of the Treasury or his delegate, and as amended from time to time.
1.53 "Retired Participant" means a person who has been a Participant,
but who has become entitled to retirement benefits under the Plan.
1.54 "Retirement Date" means the date as of which a Participant retires
for reasons other than Total and Permanent Disability, whether such retirement
occurs on a Participant's Normal Retirement Date, Early or Late Retirement Date
(see Section 6.1).
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1.55 "Super Top Heavy Plan" means a plan described in Section 9.2(b).
1.56 "Terminated Participant" means a person who has been a Participant,
but whose employment has been terminated other than by death, Total and
Permanent Disability or retirement.
1.57 "Top Heavy Plan" means a plan described in Section 9.2(a).
1.58 "Top Heavy Plan Year" means a Plan Year during which the Plan is a
Top Heavy Plan.
1.59 "Top Paid Group" means the top 20 percent of Employees who
performed services for the Employer during the applicable year, ranked according
to the amount of "415 Compensation" (determined for this purpose in accordance
with Section 1.29) received from the Employer during such year. All Affiliated
Employers shall be taken into account as a single employer.
1.60 "Total and Permanent Disability" means a physical or mental
condition of a Participant resulting from bodily injury, disease, or mental
disorder which renders him incapable of continuing his usual and customary
employment with the Employer. The disability of a Participant shall be
determined by a licensed physician chosen by the Administrator. The
determination shall be applied uniformly to all Participants.
1.61 "Trustee" means the person or entity named as trustee herein or in
any separate trust forming a part of this Plan, and any successors.
Effective prior to January 1, 1998, Trustee shall mean:
Robert A. Fries
Carl S. Williams
Michael P. Moran
Effective January 1, 1998, Trustee shall mean:
Norwest Bank Colorado
1.62 "Trust Fund" means the assets of the Plan and Trust as the same
shall exist from time to time.
1.63 "USERRA" means the Uniformed Services Employment and Reemployment
Rights Act of 1994. Notwithstanding any provision of this Plan to the contrary,
contributions, benefits and service credit with respect to qualified military
service will be provided in accordance with Code Section 414(u).
1.64 "Valuation Date" means the Anniversary Date and such other date or
dates deemed necessary by the Administrator. The Valuation Date may include any
day during the
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Plan Year that the Trustee, any transfer agent appointed by the Trustee or the
Employer and any stock exchange used by such agent are open for business.
1.65 "Vested" means the nonforfeitable portion of any account maintained
on behalf of a Participant.
1.66 "Voluntary Contribution Account" means the account established and
maintained by the Administrator for each Participant with respect to his total
interest in the Plan resulting from the Participant's nondeductible voluntary
contributions made pursuant to Section 4.12.
1.67 "Year of Service" means the computation period of twelve (12)
consecutive months, herein set forth, during which an Employee has at least 1000
Hours of Service.
For purposes of eligibility for participation, the initial computation
period shall begin with the date on which the Employee first performs an Hour of
Service. The participation computation period beginning after a 1-Year Break in
Service shall be measured from the date on which an Employee again performs an
Hour of Service. The participation computation period shall shift to the Plan
Year which includes the anniversary of the date on which the Employee first
performed an Hour of Service. An Employee who is credited with the required
Hours of Service in both the initial computation period (or the computation
period beginning after a 1-Year Break in Service) and the Plan Year which
includes the anniversary of the date on which the Employee first performed an
Hour of Service, shall be credited with two (2) Years of Service for purposes of
eligibility to participate.
For vesting purposes, the computation periods shall be the Plan Year,
including periods prior to the Effective Date of the Plan.
The computation period shall be the Plan Year if not otherwise set forth
herein.
Notwithstanding the foregoing, for any short Plan Year, the
determination of whether an Employee has completed a Year of Service shall be
made in accordance with Department of Labor regulation 2530.203-2(c). However,
in determining whether an Employee has completed a Year of Service for benefit
accrual purposes in the short Plan Year, the number of the Hours of Service
required shall be proportionately reduced based on the number of full months in
the short Plan Year.
Years of Service with the entities specified on the attached Addendum
shall be recognized for purposes of eligibility to participate and vesting.
Years of Service with any Affiliated Employer shall be recognized for
purposes of eligibility for participation and vesting, from the date the entity
became an Affiliated Employer.
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ARTICLE II
ADMINISTRATION
2.1 POWERS AND RESPONSIBILITIES OF THE EMPLOYER
(a) In addition to the general powers and responsibilities
otherwise provided for in this Plan, the Employer shall be empowered to appoint
and remove the Trustee and the Administrator from time to time as it deems
necessary for the proper administration of the Plan to ensure that the Plan is
being operated for the exclusive benefit of the Participants and their
Beneficiaries in accordance with the terms of the Plan, the Code, and the Act.
The Employer may appoint counsel, specialists, advisers, agents (including any
nonfiduciary agent) and other persons as the Employer deems necessary or
desirable in connection with the exercise of its fiduciary duties under this
Plan. The Employer may compensate such agents or advisers from the assets of the
Plan as fiduciary expenses (but not including any business (settlor) expenses of
the Employer), to the extent not paid by the Employer.
(b) The Employer shall establish a "funding policy and
method," i.e., it shall determine whether the Plan has a short run need for
liquidity (e.g., to pay benefits) or whether liquidity is a long run goal and
investment growth (and stability of same) is a more current need, or shall
appoint a qualified person to do so. The Employer or its delegate shall
communicate such needs and goals to the Trustee, who shall coordinate such Plan
needs with its investment policy. The communication of such a "funding policy
and method" shall not, however, constitute a directive to the Trustee as to
investment of the Trust Funds. Such "funding policy and method" shall be
consistent with the objectives of this Plan and with the requirements of Title I
of the Act.
(c) The Employer shall periodically review the performance of
any Fiduciary or other person to whom duties have been delegated or allocated by
it under the provisions of this Plan or pursuant to procedures established
hereunder. This requirement may be satisfied by formal periodic review by the
Employer or by a qualified person specifically designated by the Employer,
through day-to-day conduct and evaluation, or through other appropriate ways.
2.2 DESIGNATION OF ADMINISTRATIVE AUTHORITY
The Employer shall be the Administrator. The Employer may appoint any
person or committee, including, but not limited to, the Employees of the
Employer, to perform the duties of the Administrator. Any person so appointed
shall signify his acceptance by filing written acceptance with the Employer and
shall be indemnified by the Employer for actions taken in the performance of
their duties. Upon the resignation or removal of any individual performing the
duties of the Administrator, the Employer may designate a successor.
2.3 POWERS AND DUTIES OF THE ADMINISTRATOR
The primary responsibility of the Administrator is to administer the
Plan for the exclusive benefit of the Participants and their Beneficiaries,
subject to the specific terms of the Plan. The Administrator shall administer
the Plan in accordance with its terms and shall have the power
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and discretion to construe the terms of the Plan and to determine all questions
arising in connection with the administration, interpretation, and application
of the Plan. Any such determination by the Administrator shall be conclusive and
binding upon all persons and shall be overturned only if deemed to be arbitrary
and capricious. The Administrator may establish procedures, correct any defect,
supply any information, or reconcile any inconsistency in such manner and to
such extent as shall be deemed necessary or advisable to carry out the purpose
of the Plan; provided, however, that any procedure, discretionary act,
interpretation or construction shall be done in a nondiscriminatory manner based
upon uniform principles consistently applied and shall be consistent with the
intent that the Plan shall continue to be deemed a qualified plan under the
terms of Code Section 401(a), and shall comply with the terms of the Act and all
regulations issued pursuant thereto. The Administrator shall have all powers
necessary or appropriate to accomplish his duties under this Plan.
The Administrator shall be charged with the duties of the general
administration of the Plan, including, but not limited to, the following:
(a) the discretion to determine all questions relating to the
eligibility of Employees to participate or remain a Participant hereunder and to
receive benefits under the Plan;
(b) to compute, certify, and direct the Trustee with respect
to the amount and the kind of benefits to which any Participant shall be
entitled hereunder;
(c) to authorize and direct the Trustee with respect to all
nondiscretionary or otherwise directed disbursements from the Trust;
(d) to maintain all necessary records for the administration
of the Plan;
(e) to interpret the provisions of the Plan and to make and
publish such roles for regulation of the Plan as are consistent with the terms
hereof;
(f) to determine the size and type of any Contract to be
purchased from any insurer, and to designate the insurer from which such
Contract shall be purchased;
(g) to compute and certify to the Employer and to the Trustee
from time to time the sums of money necessary or desirable to be contributed to
the Plan;
(h) to consult with the Employer and the Trustee regarding the
short and long-term liquidity needs of the Plan in order that the Trustee can
exercise any investment discretion in a manner designed to accomplish specific
objectives;
(i) to prepare and distribute to Employees a procedure for
notifying Participants and Beneficiaries of their rights to elect joint and
survivor annuities and Pre-Retirement Survivor, Annuities as required by the Act
and regulations thereunder;
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(j) to prepare and implement a procedure to notify Eligible
Employees that they may elect to have a portion of their Compensation deferred
or paid to them in cash;
(k) to act as the named Fiduciary responsible for
communications with Participants as needed to maintain Plan compliance with
ERISA Section 404(c), including but not limited to the receipt and transmitting
of Participant's directions as to the investment of their account(s) under the
Plan and the formulation of policies, roles, and procedures pursuant to which
Participants may give investment instructions with respect to the investment of
their accounts;
(l) to assist any Participant regarding his rights, benefits,
or elections available under the Plan.
2.4 RECORDS AND REPORTS
The Administrator shall keep a record of all actions taken and shall
keep all other books of account, records, policies, and other data that may be
necessary for proper administration of the Plan and shall be responsible for
supplying all information and reports to the Internal Revenue Service,
Department of Labor, Participants, Beneficiaries and others as required by law.
2.5 APPOINTMENT OF ADVISERS
The Administrator, or the Trustee with the consent of the Administrator,
may appoint counsel, specialists, advisers, agents (including nonfiduciary
agents) and other persons as the Administrator or the Trustee deems necessary or
desirable in connection with the administration of this Plan, including but not
limited to agents and advisers to assist with the administration and management
of the Plan, and thereby to provide, among such other duties as the
Administrator may appoint, assistance with maintaining Plan records and the
providing of investment information to the Plan's investment fiduciaries and to
Plan Participants.
2.6 PAYMENT OF EXPENSES
All expenses of administration may be paid out of the Trust Fund unless
paid by the Employer. Such expenses shall include any expenses incident to the
functioning of the Administrator, or any person or persons retained or appointed
by any Named Fiduciary incident to the exercise of their duties under the Plan,
including, but not limited to, fees of accountants, counsel, Investment
Managers, agents (including nonfiduciary agents) appointed for the purpose of
assisting the Administrator or the Trustee in carrying out the instructions of
Participants as to the directed investment of their accounts and other
specialists and their agents, and other costs of administering the Plan. Until
paid, the expenses shall constitute a liability of the Trust Fund.
2.7 CLAIMS PROCEDURE
Claims for benefits under the Plan may be fried in writing with the
Administrator. Written notice of the disposition of a claim shall be furnished
to the claimant within 90 days after the application is Fried. In the event the
claim is denied, the reasons for the denial shall be
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specifically set forth in the notice in language calculated to be understood by
the claimant, pertinent provisions of the Plan shall be cited, and, where
appropriate, an explanation as to how the claimant can perfect the claim will be
provided. In addition, the claimant shall be furnished with an explanation of
the Plan's claims review procedure.
2.8 CLAIMS REVIEW PROCEDURE
Any Employee, former Employee, or Beneficiary of either, who has been
denied a benefit by a decision of the Administrator pursuant to Section 2.7
shall be entitled to request the Administrator to give further consideration to
his claim by filing with the Administrator (on a form which may be obtained from
the Administrator) a request for a hearing. Such request, together with a
written statement of the reasons why the claimant believes his claim should be
allowed, shall be Fried with the Administrator no later than 60 days after
receipt of the written notification provided for in Section 2.7. The
Administrator shall then conduct a hearing within the next 60 days, at which the
claimant may be represented by an attorney or any other representative of his
choosing and at which the claimant shall have an opportunity to submit written
and oral evidence and arguments in support of his claim. At the hearing (or
prior thereto upon 5 business days written notice to the Administrator) the
claimant or his representative shall have an opportunity to review all documents
in the possession of the Administrator which are pertinent to the claim at issue
and its disallowance. Either the claimant or the Administrator may cause a court
reporter to attend the hearing and record the proceedings. In such event, a
complete written transcript of the proceedings shall be furnished to both
parties by the court reporter. The full expense of any such court reporter and
such transcripts shall be borne by the party causing the court reporter to
attend the heating. A final decision as to the allowance of the claim shall be
made by the Administrator within 60 days of receipt of the appeal (unless there
has been an extension of 60 days due to special circumstances, provided the
delay and the special circumstances occasioning it are communicated to the
claimant within the 60 day period). Such communication shall be written in a
manner calculated to be understood by the claimant and shah include specific
reasons for the decision and specific references to the pertinent Plan
provisions on which the decision is based.
ARTICLE III
ELIGIBILITY
3.1 CONDITIONS OF ELIGIBILITY
Any Eligible Employee who has completed one (1) Year of Service and has
attained age 21 shall be eligible to participate hereunder as of the date he has
satisfied such requirements. However, any Employee who was a Participant in the
Plan prior to the effective date of this amendment and restatement shall
continue to participate in the Plan.
3.2 EFFECTIVE DATE OF PARTICIPATION
An Eligible Employee shall become a Participant effective as of the
first day of the month coinciding with or next following the date on which such
Employee met the eligibility
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requirements of Section 3.1, provided said Employee was still employed as of
such date (or if not employed on such date, as of the date of rehire if a 1-Year
Break in Service has not occurred).
In the event an Employee who is not a member of an eligible class of
Employees becomes a member of an eligible class, such Employee will participate
immediately if such Employee has satisfied the minimum age and service
requirements and would have otherwise previously become a Participant.
3.3 DETERMINATION OF ELIGIBILITY
The Administrator shall determine the eligibility of each Employee for
participation in the Plan based upon information furnished by the Employer. Such
determination shall be conclusive and binding upon all persons, as long as the
same is made pursuant to the Plan and the Act. Such determination shall be
subject to review per Section 2.8.
3.4 TERMINATION OF ELIGIBILITY
(a) In the event a Participant shall go from a classification
of an Eligible Employee to an ineligible Employee, such Former Participant shall
continue to vest in his interest in the Plan for each Year of Service completed
while a noneligible Employee, until such time as his Participant's Account shall
be forfeited or distributed pursuant to the terms of the Plan. Additionally, his
interest in the Plan shall continue to share in the earnings of the Trust Fund.
(b) In the event a Participant is no longer a member of an
eligible class of Employees and becomes ineligible to participate, such Employee
will participate immediately upon returning to an eligible class of Employees.
3.5 ELECTION NOT TO PARTICIPATE
An Employee may, subject to the approval of the Employer, elect
voluntarily not to participate in the Plan. The election not to participate must
be communicated to the Employer, in writing, at least thirty (30) days before
the beginning of a Plan Year.
ARTICLE IV
CONTRIBUTION AND ALLOCATION
4.1 FORMULA FOR DETERMINING EMPLOYER CONTRIBUTION
For each Plan Year, the Employer shall contribute to the Plan:
(a) The amount of the total salary reduction elections of all
Participants made pursuant to Section 4.2(a), which amount shall be deemed an
Employer Elective Contribution.
(b) On behalf of each Participant who is eligible to share in
matching contributions for the Plan Year, a discretionary matching contribution
equal to a uniform
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percentage of each such Participant's Deferred Compensation, the exact
percentage, if any, to be determined each year by the Employer, which amount, if
any, shall be deemed an Employer Non-Elective Contribution.
In determining the amount of matching contribution for a given plan year
quarter, Compensation and Deferred Compensation shall be recognized for that
plan year quarter only.
(c) On behalf of each Non-Highly Compensated Participant who
is eligible to share in the Qualified Non-Elective Contribution for the Plan
Year, a discretionary Qualified Non-Elective Contribution equal to a uniform
percentage of each eligible individual's Compensation, the exact percentage, if
any, to be determined each year by the Employer. Any Employer Qualified
Non-Elective Contribution shall be deemed an Employer Elective Contribution.
(d) A discretionary amount, which amount, if any, shall be
deemed an Employer Non-Elective Contribution.
(e) Additionally, to the extent necessary, the Employer shall
contribute to the Plan the amount necessary to provide the top heavy minimum
contribution. All contributions by the Employer shall be made in cash.
4.2 PARTICIPANT'S SALARY REDUCTION ELECTION
(a) Each Participant may elect to defer from 2% to 16% of his
Compensation which would have been received in the Plan Year, but for the
deferral election. Effective prior to January 1, 1998, each Participant may
elect to defer from 3% to 18% of his Compensation.
A deferral election (or modification of an earlier election) may not be
made with respect to Compensation which is currently available on or before the
date the Participant executed such election. For purposes of this Section,
Compensation shall be determined prior to any reductions made pursuant to Code
Sections 125, 402(e)(3), 402(h)(1)(B), 403(b) or 457(b), and Employee
contributions described in Code Section 414(h)(2) that are treated as Employer
contributions.
The amount by which Compensation is reduced shall be that Participant's
Deferred Compensation and be treated as an Employer Elective Contribution and
allocated to that Participant's Elective Account.
(b) The balance in each Participant's Elective Account shall
be fully Vested at all times and shall not be subject to Forfeiture for any
reason.
(c) Notwithstanding anything in the Plan to the contrary,
amounts held in the Participant's Elective Account may not be distributable
(including any offset of loans) earlier than:
(1) a Participant's separation from service, Total and
Permanent Disability, or death;
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(2) a Participant's attainment of age 59 1/2;
(3) the termination of the Plan without the establishment
or existence of a "successor plan," as that term is described in Regulation
1.401(k)-1 (d)(3);
(4) the date of disposition by the Employer to an entity
that is not an Affiliated Employer of substantially all of tile assets (within
the meaning of Code Section 409(d)(2)) used in a trade or business of such
corporation if such corporation continues to maintain this Plan after the
disposition with respect to a Participant who continues employment with the
corporation acquiring such assets;
(5) the date of disposition by the Employer or an
Affiliated Employer who maintains the Plan of its interest in a subsidiary
(within the meaning of Code Section 409(d)(3)) to an entity which is not an
Affiliated Employer but only with respect to a Participant who continues
employment with such subsidiary; or
(6) the proven financial hardship of a Participant,
subject to the limitations of Section 6.11.
(d) For each Plan Year, a Participant's Deferred Compensation
made under this Plan and all other plans, contracts or arrangements of the
Employer maintaining this Plan shall not exceed, during any taxable year of the
Participant, the limitation imposed by Code Section 402(g), as in effect at the
beginning of such taxable year. If such dollar limitation is exceeded, a
Participant will be deemed to have notified the Administrator of such excess
amount which shall be distributed in a manner consistent with Section 4.2(f).
The dollar limitation shall be adjusted annually pursuant to the method provided
in Code Section 415(d) in accordance with Regulations.
(e) In the event a Participant has received a hardship
distribution from his Participant's Elective Account pursuant to Section 6.11
(c) or pursuant to Regulation 1. 401(k)- l (d) (2) (iv) (b) from any other plan
maintained by the Employer, then such Participant shall not be permitted to
elect to have Deferred Compensation contributed to the Plan on his behalf for a
period of twelve (12) months following the receipt of the distribution.
Furthermore, the dollar limitation under Code Section 402(g) shall be reduced,
with respect to the Participant's taxable year following the taxable year in
which the hardship distribution was made, by the amount of such Participant's
Deferred Compensation, if any, pursuant to this Plan (and any other plan
maintained by the Employer) for the taxable year of the hardship distribution.
(f) If a Participant's Deferred Compensation under this Plan
together with any elective deferrals (as defined in Regulation 1.402(g)-l(b))
under another qualified cash or deferred arrangement (as defined in Code Section
401(k)), a simplified employee pension (as defined in Code Section 408(k)), a
salary reduction arrangement (within the meaning of Code Section 3121(a)(5)(D)),
a deferred compensation plan under Code Section 457(b), or a trust described in
Code Section 501(c)(18) cumulatively exceed the limitation imposed by Code
Section 402(g) (as adjusted annually in accordance with the method provided in
Code
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Section 415(d) pursuant to Regulations) for such Participant's taxable year, the
Participant may, not later than March 1 following the close of the Participant's
taxable year, notify the Administrator in writing of such excess and request
that his Deferred Compensation under this Plan be reduced by an amount specified
by the Participant. In such event, the Administrator may direct the Trustee to
distribute such excess amount (and any Income allocable to such excess amount)
to the Participant not later than the first April 15th following the close of
the Participant's taxable year. Any distribution of less than the entire amount
of Excess Deferred Compensation and Income shall be treated as a pro rata
distribution of Excess Deferred Compensation and Income. The amount distributed
shall not exceed the Participant's Deferred Compensation under the Plan for the
taxable year (and any Income allocable to such excess amount). Any distribution
on or before the last day of the Participant's taxable year must satisfy each of
the following conditions:
(1) the distribution must be made after the date on which
the Plan received the Excess Deferred Compensation;
(2) the Participant shall designate the distribution as
Excess Deferred Compensation; and
(3) the Plan must designate the distribution as a
distribution of Excess Deferred Compensation.
Matching contributions which relate to Excess Deferred Compensation
which is distributed pursuant to this Section 4.2(f) shall be forfeited.
(g) Notwithstanding Section 4.2(f) above, a Participant's
Excess Deferred Compensation shall be reduced, but not below zero, by any
distribution of Excess Contributions pursuant to Section 4.6(a) for the Plan
Year beginning with or within the taxable year of the Participant.
(h) At Normal Retirement Date, or such other date when the
Participant shall be entitled to receive benefits, the fair market value of the
Participant's Elective Account shall be used to provide additional benefits to
the Participant or his Beneficiary.
(i) Employer Elective Contributions made pursuant to this
Section may be segregated into a separate account for each Participant in a
federally insured savings account, certificate of deposit in a bank or savings
and loan association, money market certificate, or other short-term debt
security acceptable to the Trustee until such time as the allocations pursuant
to Section 4.4 have been made.
(j) The Employer and the Administrator shall implement the
salary reduction elections provided for herein in accordance with the following:
(1) A Participant must make his initial salary deferral
election within a reasonable time, not to exceed thirty (30) days, after
entering the Plan pursuant to Section 3.2. If the Participant fails to make an
initial salary deferral election within such time, then such
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Participant may thereafter make an election in accordance with the roles
governing modifications. The Participant shall make such an election by entering
into a written salary reduction agreement with the Employer and filing such
agreement with the Administrator. Such election shall initially be effective
beginning with the pay period following the acceptance of the salary reduction
agreement by the Administrator, shall not have retroactive effect and shall
remain in force until revoked.
(2) A Participant may modify a prior election at any time
during the Plan Year and concurrently make a new election by filing a written
notice with the Administrator within a reasonable time before the pay period for
which such modification is to be effective. Any modification shall not have
retroactive effect and shall remain in force until revoked. Prior to January 1,
1998, modifications are effective only as of the first day of the month
following the date that the new election is Fried with the Administrator.
(3) A Participant may elect to prospectively revoke his
salary reduction agreement in its entirety at any time during the Plan Year by
providing the Administrator with thirty (30) days written notice of such
revocation (or upon such shorter notice period as may be acceptable to the
Administrator). Such revocation shall become effective as of the beginning of
the first pay period coincident with or next following the expiration of the
notice period. Furthermore, the termination of the Participant's employment, or
the cessation of participation for any reason, shall be deemed to revoke any
salary reduction agreement then in effect, effective immediately following the
close of the pay period within which such termination or cessation Occurs.
4.3 TIME OF PAYMENT OF EMPLOYER CONTRIBUTION
The Employer shall generally pay to the Trustee its contribution to the
Plan for each Plan Year within the time prescribed by law, including extensions
of time, for the filing of the Employer federal income tax return for the Fiscal
Year.
However, Employer Elective Contributions accumulated through payroll
deductions shall be paid to the Trustee as of the earliest date on which such
contributions can reasonably be segregated from the Employer 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 Participant
in cash. The provisions of Department of Labor regulations 2510.3-102 are
incorporated herein by reference. Furthermore, any additional Employer
contributions which are allocable to the Participant's Elective Account for a
Plan Year shall be paid to the Plan no later than the twelve-month period
immediately following the close of such Plan Year.
4.4 ALLOCATION OF CONTRIBUTION, FORFEITURES AND EARNINGS
(a) The Administrator shall establish and maintain an account
in the name of each Participant to which the Administrator shall credit as of
each Anniversary Date all amounts allocated to each such Participant as set
forth herein.
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(b) The Employer shall provide the Administrator with all
information required by the Administrator to make a proper allocation of the
Employer contributions for each Plan Year. Within a reasonable period of time
after the date of receipt by the Administrator of such information, the
Administrator shall allocate such contribution as follows:
(1) With respect to the Employer Elective Contribution
made pursuant to Section 4.1 (a), to each Participant's Elective Account in an
amount equal to each such Participant's Deferred Compensation for the year.
(2) With respect to the Employer Non-Elective Contribution
made pursuant to Section 4.1 (b), to each Participant's Account in accordance
with Section 4.1 (b).
Any Participant actively employed during the Plan Year shall be eligible
to share in the matching contribution for the Plan Year.
(3) With respect to the Employer Qualified Non-Elective
Contribution made pursuant to Section 4.1 (c), to each Participant's Elective
Account when used to satisfy the "Actual Deferral Percentage" tests or
Participant's Account in accordance with Section 4.1(c).
Any Non-Highly Compensated Participant actively employed during the Plan
Year shall be eligible to share in the Qualified Non-Elective Contribution for
the Plan Year.
(4) With respect to the Employer Non-Elective Contribution
made pursuant to Section 4.1(d), to each Participant's Account in the same
proportion that each such Participant's Compensation for the year bears to the
total Compensation of all Participants for such year.
Effective January 1, 1998, only Participants who have completed a Year
of Service during the Plan Year and are actively employed on the last day of the
Plan Year shall be eligible to share in the discretionary contribution for the
year. Effective prior to January 1, 1998, only Participants who are actively
employed on the last day of the Plan Year or who completed a Year of Service in
the year of their termination of employment shall be eligible to share in the
discretionary contribution for the year.
(c) As of each Anniversary Date any amounts which became
Forfeitures since the last Anniversary Date shall first be made available to
reinstate previously forfeited account balances of Former Participants, if any,
in accordance with Section 6.4(g)(2). The remaining Forfeitures, if any, shall
be allocated to Participants' Accounts and used to reduce the contribution of
the Employer hereunder for the Plan Year in which such Forfeitures occur in the
following manner:
(1) Forfeitures attributable to Employer matching
contributions made pursuant to Section 4.1 (b) shall be used to reduce the
Employer contribution for the Plan Year in which such Forfeitures occur.
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(2) Forfeitures attributable to Employer discretionary
contributions made pursuant to Section 4.1 (d) shall be added to any Employer
discretionary contribution for the Plan Year in which such Forfeitures occur and
allocated among the Participants' Accounts in the same manner as any Employer
discretionary contribution.
Provided, however, that in the event the allocation of Forfeitures
provided herein shall cause the "annual addition" (as defined in Section 4.9) to
any Participant's Account to exceed the amount allowable by the Code, the excess
shall be reallocated in accordance with Section 4.10.
(d) For any Top Heavy Plan Year, Non-Key Employees not
otherwise eligible to share in the allocation of contributions and Forfeitures
as provided above, shall receive the minimum allocation provided for in Section
4.4(g) if eligible pursuant to the provisions of Section 4.4(i).
(e) Notwithstanding the foregoing, Participants who are not
actively employed on the last day of the Plan Year due to Total and Permanent
Disability or death shall share in the allocation of contributions and
Forfeitures for that Plan Year.
(f) As of each Valuation Date, any earnings or losses (net
appreciation or net depreciation) of the Trust Fund shall be allocated in the
same proportion that each Participant's and Former Participant's time weighted
average nonsegregated accounts bear to the total of all Participants' and Former
Participants' time weighted average nonsegregated accounts as of such date.
Earnings or losses with respect to a Participant's Directed Account shall be
allocated in accordance with Section 4.13.
Participants' transfers from other qualified plans deposited in the
general Trust Fund shall share in any earnings and losses (net appreciation or
net depreciation) of the Trust Fund in the same manner provided above. Each
segregated account maintained on behalf of a Participant shall be credited or
charged with its separate earnings and losses.
(g) Minimum Allocations Required for Top Heavy Plan Years:
Notwithstanding the foregoing, for any Top Heavy Plan Year, the sum of the
Employer contributions and Forfeitures allocated to the Participant's Combined
Account of each Non-Key Employee shall be equal to at least three percent (3%)
of such Non-Key Employee's "415 Compensation" (reduced by contributions and
forfeitures, if any, allocated to each Non-Key Employee in any defined
contribution plan included with this plan in a Required Aggregation Group).
However, if (1) the sum of the Employer contributions and Forfeitures allocated
to the Participant's Combined Account of each Key Employee for such Top Heavy
Plan Year is less than three percent (3%) of each Key Employee's "415
Compensation" and (2) this Plan is not required to be included in an Aggregation
Group to enable a defined benefit plan to meet the requirements of Code Section
401(a)(4) or 410, the sum of the Employer contributions and Forfeitures
allocated to the Participant's Combined Account of each Non-Key Employee shall
be equal to the largest percentage allocated to the Participant's Combined
Account of any Key Employee. However, in determining whether a Non-Key Employee
has received the required minimum allocation, such Non-Key Employee's Deferred
Compensation and matching
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<PAGE> 30
contributions needed to satisfy the "Actual Contribution Percentage" tests
pursuant to Section 4.7(a) shall not be taken into account.
However, no such minimum allocation shall be required in this Plan for
any Non-Key Employee who participates in another defined contribution plan
subject to Code Section 412 included with this Plan in a Required Aggregation
Group.
(h) For purposes of the minimum allocations set forth above,
the percentage allocated to the Participant's Combined Account of any Key
Employee shall be equal to the ratio of the sum of the Employer contributions
and Forfeitures allocated on behalf of such Key Employee divided by the "415
Compensation" for such Key Employee.
(i) For any Top Heavy Plan Year, the minimum allocations set
forth above shall be allocated to the Participant's Combined Account of all
Non-Key Employees who are Participants and who are employed by the Employer on
the last day of the Plan Year, including Non-Key Employees who have (1) failed
to complete a Year of Service; and (2) declined to make mandatory contributions
(if required) or, in the case of a cash or deferred arrangement, elective
contributions to the Plan.
(j) For the purposes of this Section, "415 Compensation" shall
be limited to $150,000. Such amount shall be adjusted for increases in the cost
of living in accordance with Code Section 401(a)(17), except that the dollar
increase in effect on January 1 of any calendar year shall be effective for the
Plan Year beginning with or within such calendar year. For any short Plan Year
the "415 Compensation" limit shall be an amount equal to the "415 Compensation"
limit for the calendar year in which the Plan Year begins multiplied by the
ratio obtained by dividing the number of full months in the short Plan Year by
twelve (12).
(k) Notwithstanding anything herein to the contrary,
Participants who terminated employment for any reason during the Plan Year shall
share in the salary reduction contributions made by the Employer for the year of
termination without regard to the Hours of Service credited.
(l) If a Former Participant is reemployed after five (5)
consecutive 1-Year Breaks in Service, then separate accounts shall be maintained
as follows:
(1) one account for nonforfeitable benefits attributable
to pre-break service; and
(2) one account representing his status in the Plan
attributable to post-break service.
4.5 ACTUAL DEFERRAL PERCENTAGE TESTS
(a) Maximum Annual Allocation: For each Plan Year, the annual
allocation derived from Employer Elective Contributions to a Participant's
Elective Account shah satisfy one of the following tests:
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<PAGE> 31
(1) The "Actual Deferral Percentage" for the Highly
Compensated Participant group shall not be more than the "Actual Deferral
Percentage" of the Non-Highly Compensated Participant group multiplied by 1.25,
or
(2) The excess of the "Actual Deferral Percentage" for the
Highly Compensated Participant group over the "Actual Deferral Percentage" for
the Non-Highly Compensated Participant group shall not be more than two
percentage points. Additionally, the "Actual Deferral Percentage" for the Highly
Compensated Participant group shall not exceed the "Actual Deferral Percentage"
for the Non-Highly Compensated Participant group multiplied by 2. The provisions
of Code Section 401(k)(3) and Regulation 1.401(k)-l(b) are incorporated herein
by reference.
However, in order to prevent the multiple use of the alternative method
described in (2) above and in Code Section 401(m) (9) (a) , any Highly
Compensated Participant eligible to make elective deferrals pursuant to Section
4.2 and to make Employee contributions or to receive matching contributions
under this Plan or under any other plan maintained by the Employer or an
Affiliated Employer shall have a combination of his Elective Contributions and
his Employee contributions and matching contributions reduced pursuant to
Section 4.6(a) and Regulation 1.401 (m)-2, the provisions of which are
incorporated herein by reference.
(b) For the purposes of this Section "Actual Deferral
Percentage" means, with respect to the Highly Compensated Participant group and
Non-Highly Compensated Participant group for a Plan Year, the average of the
ratios, calculated separately for each Participant in such group, of the amount
of Employer Elective Contributions allocated to each Participant's Elective
Account for such Plan Year, to such Participant's "414(s) Compensation" for such
Plan Year. The actual deferral ratio for each Participant and the "Actual
Deferral Percentage" for each group shall be calculated to the nearest
one-hundredth of one percent. Employer Elective Contributions allocated to each
Non-Highly Compensated Participant's Elective Account shah be reduced by Excess
Deferred Compensation to the extent such excess amounts are made under this Plan
or any other plan maintained by the Employer.
(c) For the purposes of Sections 4.5(a) and 4.6, a Highly
Compensated Participant and a Non-Highly Compensated Participant shall include
any Employee eligible to make a deferral election pursuant to Section 4.2,
whether or not such deferral election was made or suspended pursuant to Section
4.2.
(d) For the purposes of this Section and Code Sections
401(a)(4), 410(b) and 401(k), if two or more plans which include cash or
deferred arrangements are considered one plan for the purposes of Code Section
401 (a)(4) or 410(b) (other than Code Section 410(b)(2)(A)(ii)), the cash or
deferred arrangements included in such plans shall be treated as one
arrangement. In addition, two or more cash or deferred arrangements may be
considered as a single arrangement for purposes of determining whether or not
such arrangements satisfy Code Sections 401(a)(4), 410(b) and 401(k). In such a
case, the cash or deferred arrangements included in such plans and the plans
including such arrangements shall be treated as one arrangement and as one plan
for purposes of this Section and Code Sections
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401(a)(4), 410(b) and 4010c). Plans may be aggregated under this paragraph (e)
only if they have the same plan year.
Notwithstanding the above, an employee stock ownership plan described in
Code Section 4975(e)(7) or 409 may not be combined with this Plan for purposes
of determining whether the employee stock ownership plan or this Plan satisfies
this Section and Code Sections 401(a)(4), 410(b) and 401(k).
(e) For the purposes of this Section, if a Highly Compensated
Participant is a Participant under two or more cash or deferred arrangements
(other than a cash or deferred arrangement which is part of an employee stock
ownership plan as defined in Code Section 4975(e)(7) or 409) of the Employer or
an Affiliated Employer, all such cash or deferred arrangements shall be treated
as one cash or deferred arrangement for the purpose of determining the actual
deferral ratio with respect to such Highly Compensated Participant. However, if
the cash or deferred arrangements have different plan years, this paragraph
shall be applied by treating all cash or deferred arrangements ending with or
within the same calendar year as a single arrangement.
4.6 ADJUSTMENT TO ACTUAL DEFERRAL PERCENTAGE TESTS
In the event that the initial allocations of the Employer Elective
Contributions made pursuant to Section 4.4 do not satisfy one of the tests set
forth in Section 4.5(a), the Administrator shall adjust Excess Contributions
pursuant to the options set forth below:
(a) On or before the fifteenth day of the third month
following the end of each Plan Year, the Highly Compensated Participant having
the largest amount of Elective Contributions shall have a portion of his
Elective Contributions distributed to him until the total amount of Excess
Contributions has been distributed, or until the amount of his Elective
Contributions equals the Elective Contributions of the Highly Compensated
Participant having the second largest amount of Elective Contributions. This
process shall continue until the total amount of Excess Contributions has been
distributed. In determining the amount of Excess Contributions to be distributed
with respect to an affected Highly Compensated Participant as determined herein,
such amount shall be reduced pursuant to Section 4.2(f) by any Excess Deferred
Compensation previously distributed to such affected Highly Compensated
Participant for his taxable year ending with or within such Plan Year.
(1) With respect to the distribution of Excess
Contributions pursuant to (a) above, such distribution:
(i) may be postponed but not later than the close
of the Plan Year following the Plan Year to which they are allocable;
(ii) shall be adjusted for Income; and
(iii) shall be designated by the Employer as a
distribution of Excess Contributions (and Income).
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(2) Any distribution of less than the entire amount of
Excess Contributions shall be treated as a pro rata distribution of Excess
Contributions and Income.
(3) Matching contributions which relate to Excess
Contributions shall be forfeited unless the related matching contribution is
distributed as an Excess Aggregate Contribution pursuant to Section 4.8.
(b) Within twelve (12) months after the end of the Plan Year,
the Employer may make a special Qualified Non-Elective Contribution on behalf of
Non-Highly Compensated Participants electing salary reductions pursuant to
Section 4.2 in an amount sufficient to satisfy one of the tests set forth in
Section 4.5(a). Such contribution shall be allocated to the Participant's
Elective Account of each Non-Highly Compensated Participant electing salary
reductions pursuant to Section 4.2 in the same proportion that each such
Non-Highly Compensated Participant's Deferred Compensation for the year bears to
the total Deferred Compensation of all such Non-Highly Compensated Participants.
(c) If during a Plan Year the projected aggregate amount of
Elective Contributions to be allocated to all Highly Compensated Participants
under this Plan would, by virtue of the tests set forth in Section 4.5(a), cause
the Plan to fail such tests, then the Administrator may automatically reduce
proportionately or in the order provided in Section 4.6(a) each affected Highly
Compensated Participant's deferral election made pursuant to Section 4.2 by an
amount necessary to satisfy one of the tests set forth in Section 4.5(a).
4.7 ACTUAL CONTRIBUTION PERCENTAGE TESTS
(a) The "Actual Contribution Percentage" for the Highly
Compensated Participant group shall not exceed the greater of:
(1) 125 percent of such percentage for the Non-Highly
Compensated Participant group; or
(2) the lesser of 200 percent of such percentage for the
Non-Highly Compensated Participant group, or such percentage for the Non-Highly
Compensated Participant group plus 2 percentage points. However, to prevent the
multiple use of the alternative method described in this paragraph and Code
Section 401(m) (9) (a) , any Highly Compensated Participant eligible to make
elective deferrals pursuant to Section 4.2 or any other cash or deferred
arrangement maintained by the Employer or an Affiliated Employer and to make
Employee contributions or to receive matching contributions under this Plan or
under any plan maintained by the Employer or an Affiliated Employer shall have a
combination of his Elective Contributions and his Employee contributions and
matching contributions reduced pursuant to Regulation 1.401(m)-2 and Section
4.8(a). The provisions of Code Section 401(m) and Regulations 1.401 (m)-1 (b)
and 1.401 (m)-2 are incorporated herein by reference.
(b) For the purposes of this Section and Section 4.8, "Actual
Contribution Percentage" for a Plan Year means, with respect to the Highly
Compensated Participant group
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and Non-Highly Compensated Participant group, the average of the ratios
(calculated separately for each Participant in each group rounded to the nearest
one-hundredth of one percent) of:
(1) the sum of Employer matching contributions made
pursuant to Section 4.1 (b) on behalf of each such Participant for such Plan
Year; to
(2) the Participant's "414(s) Compensation" for such Plan
Year.
(c) For purposes of determining the "Actual Contribution
Percentage," only Employer matching contributions contributed to the Plan prior
to the end of the succeeding Plan Year shall be considered. In addition, the
Administrator may elect to take into account, with respect to Employees eligible
to have Employer matching contributions pursuant to Section 4.1 (b) allocated to
their accounts, elective deferrals (as defined in Regulation 1.402(g)-1(b)) and
qualified non-elective contributions (as defined in Code Section 401(m)(4)(C))
contributed to any plan maintained by the Employer. Such elective deferrals and
qualified non-elective contributions shall be treated as Employer matching
contributions subject to Regulation 1. 401(m)-1(b) (5) which is incorporated
herein by reference. However, the Plan Year must be the same as the plan year of
the plan to which the elective deferrals and the qualified non-elective
contributions are made.
(d) For purposes of this Section and Code Sections 401(a)(4),
410(b) and 401(m), if two or more plans of the Employer to which matching
contributions, Employee contributions, or both, are made are treated as one plan
for purposes of Code Sections 401(a)(4) or 410(b) (other than the average
benefits test under Code Section 410(b)(2)(A)(ii)), such plans shall be treated
as one plan. In addition, two or more plans of the Employer to which matching
contributions, Employee contributions, or both, are made may be considered as a
single plan for purposes of determining whether or not such plans satisfy Code
Sections 401(a)(4), 410(b) and 401(m). In such a case, the aggregated plans must
satisfy this Section and Code Sections 401(a)(4), 410(b) and 401(m) as though
such aggregated plans were a single plan. Plans may be aggregated under this
paragraph (e) only if they have the same plan year.
Notwithstanding the above, an employee stock ownership plan described in
Code Section 4975(e)(7) or 409 may not be aggregated with this Plan for purposes
of determining whether the employee stock ownership plan or this Plan satisfies
this Section and Code Sections 401(a)(4), 410(b) and 401(m).
(e) If a Highly Compensated Participant is a Participant under
two or more plans (other than an employee stock ownership plan as defined in
Code Section 4975(e)(7) or 409) which are maintained by the Employer or an
Affiliated Employer to which matching contributions, Employee contributions, or
both, are made, all such contributions on behalf of such Highly Compensated
Participant shall be aggregated for purposes of determining such Highly
Compensated Participant's actual contribution ratio. However, if the plans have
different plan years, this paragraph shall be applied by treating all plans
ending with or within the same calendar year as a single plan.
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(f) For purposes of Sections 4.7(a) and 4.8, a Highly
Compensated Participant and Non-Highly Compensated Participant shall include any
Employee eligible to have Employer matching contributions pursuant to Section
4.1 (b) (whether or not a deferral election was made or suspended pursuant to
Section 4.2(e)) allocated to his account for the Plan Year.
4.8 ADJUSTMENT TO ACTUAL CONTRIBUTION PERCENTAGE TESTS
(a) In the event that the "Actual Contribution Percentage" for
the Highly Compensated Participant group exceeds the "Actual Contribution
Percentage" for the Non-Highly Compensated Participant group pursuant to Section
4.7(a), the Administrator (on or before the fifteenth day of the third month
following the end of the Plan Year, but in no event later than the close of the
following Plan Year) shall direct the Trustee to distribute to the Highly
Compensated Participant having the largest amount of contributions determined
pursuant to Section 4.7(b)(1), his Vested portion of such contributions (and
Income allocable to such contributions) and, if forfeitable, forfeit such
non-Vested portion of such contributions attributable to Employer matching
contributions (and Income allocable to such forfeitures) until the total amount
of Excess Aggregate Contributions has been distributed, or until his remaining
amount equals the amount of contributions determined pursuant to Section
4.7(b)(1) of the Highly Compensated Participant having the second largest amount
of contributions. This process shall continue until the total amount of Excess
Aggregate Contributions has been distributed.
If the correction of Excess Aggregate Contributions attributable to
Employer matching contributions is not in proportion to the Vested and
non-Vested portion of such contributions, then the Vested portion of the
Participant's Account attributable to Employer matching contributions after the
correction shall be subject to Section 6.50).
(b) Any distribution and/or forfeiture of less than the entire
amount of Excess Aggregate Contributions (and Income) shall be treated as a pro
rata distribution and/or forfeiture of Excess Aggregate Contributions and
Income. Distribution of Excess Aggregate Contributions shall be designated by
the Employer as a distribution of Excess Aggregate Contributions (and Income).
Forfeitures of Excess Aggregate Contributions shall be treated in accordance
with Section 4.4.
(c) Excess Aggregate Contributions, including forfeited
matching contributions, shall be treated as Employer contributions for purposes
of Code Sections 404 and 415 even if distributed from the Plan.
Forfeited matching contributions that are reallocated to Participants'
Accounts for the Plan Year in which the forfeiture occurs shall be treated as an
"annual addition" pursuant to Section 4.9(b) for the Participants to whose
Accounts they are reallocated and for the Participants from whose Accounts they
are forfeited.
(d) For each Highly Compensated Participant, the amount of
Excess Aggregate Contributions is equal to the Employer matching contributions
made pursuant to Section 4.1 (b) and any qualified non-elective contributions or
elective deferrals taken into
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account pursuant to Section 4.7(c) on behalf of the Highly Compensated
Participant (determined prior to the application of this paragraph) minus the
amount determined by multiplying the Highly Compensated Participant's actual
contribution ratio (determined after application of this paragraph) by his
"414(s) Compensation." The actual contribution ratio must be rounded to the
nearest one-hundredth of one percent. In no case shall the amount of Excess
Aggregate Contribution with respect to any Highly Compensated Participant exceed
the amount of Employer matching contributions made pursuant to Section 4.1 (b)
and any qualified non-elective contributions or elective deferrals taken into
account pursuant to Section 4.7(c) on behalf of such Highly Compensated
Participant for such Plan Year.
(e) The determination of the amount of Excess Aggregate
Contributions with respect to any Plan Year shah be made after first determining
the Excess Contributions, if any, to be treated as voluntary Employee
contributions due to recharacterization for the plan year of any other qualified
cash or deferred arrangement (as defined in Code Section 4010c)) maintained by
the Employer that ends with or within the Plan Year.
(f) If during a Plan Year the projected aggregate amount of
Employer matching contributions to be allocated to all Highly Compensated
Participants under this Plan would, by virtue of the tests set forth in Section
4.7(a), cause the Plan to fail such tests, then the Administrator may
automatically reduce proportionately or in the order provided in Section 4.8(a)
each affected Highly Compensated Participant's projected share of such
contributions by an amount necessary to satisfy one of the tests set forth in
Section 4.7(a).
(g) Notwithstanding the above, within twelve (12) months after
the end of the Plan Year, the Employer may make a special Qualified Non-Elective
Contribution on behalf of Non-Highly Compensated Participants in an amount
sufficient to satisfy one of the tests set forth in Section 4.7(a). Such
contribution shall be allocated to the Participant's Account of each Non-Highly
Compensated Participant in the same proportion that each Non-Highly Compensated
Participant's Compensation for the year bears to the total Compensation of all
Non-Highly Compensated Participants. A separate accounting of any special
Qualified Non-Elective Contribution shall be maintained in the Participant's
Account.
4.9 MAXIMUM ANNUAL ADDITIONS
(a) Notwithstanding the foregoing, the maximum "annual
additions" credited to a Participant's accounts for any "limitation year" shall
equal the lesser of: (1) $30,000 adjusted annually as provided in Code Section
415(d) pursuant to the Regulations, or (2) twenty-five percent (25%) of the
Participant's "415 Compensation" for such "limitation year." For any short
"limitation year," the dollar limitation in (1) above shall be reduced by a
fraction, the numerator of which is the number of full months in the short
"limitation year" and the denominator of which is twelve (12).
(b) For purposes of applying the limitations of Code Section
415, "annual additions" means the sum credited to a Participant's accounts for
any "limitation year" of (1) Employer contributions, (2) Employee contributions,
(3) forfeitures, (4) amounts allocated, after March 31, 1984, to an individual
medical account, as defined in Code
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Section 415(1)(2) which is part of a pension or annuity plan maintained by the
Employer and (5) amounts derived from contributions paid or accrued after
December 31, 1985, in taxable years ending after such date, which are
attributable to post-retirement medical benefits allocated to the separate
account of a key employee (as defined in Code Section 419A(d)(3)) under a
welfare benefit plan (as defined in Code Section 419(e)) maintained by the
Employer. Except, however, the "415 Compensation" percentage limitation referred
to in paragraph (a)(2) above shall not apply to: (1) any contribution for
medical benefits (within the meaning of Code Section 419A(f)(2)) after
separation from service which is otherwise treated as an "annual addition," or
(2) any amount otherwise treated as an "annual addition" under Code Section
415(1)(1).
(c) For purposes of applying the limitations of Code Section
415, the transfer of funds from one qualified plan to another is not an "annual
addition." In addition, the following are not Employee contributions for the
purposes of Section 4.9(b)(2)' (1) rollover contributions (as defined in Code
Sections 402(e)(6), 403(a)(4), 403(b)(8) and 408(d)(3)); (2) repayments of loans
made to a Participant from the Plan; (3) repayments of distributions received by
an Employee pursuant to Code Section 411(a) (7) (b) (cash-outs); (4) repayments
of distributions received by an Employee pursuant to Code Section 411(a)(3)(d)
(mandatory contributions); and (5) Employee contributions to a simplified
employee pension excludable from gross income under Code Section 408(k)(6).
(d) For purposes of applying the limitations of Code Section
415, the "limitation year" shall be the Plan Year.
(e) For the purpose of this Section, all qualified defined
contribution plans (whether terminated or not) ever maintained by the Employer
shall be treated as one defined contribution plan.
(f) For the purpose of this Section, if the Employer is a
member of a controlled group of corporations, trades or businesses under common
control (as defined by Code Section 1563(a) or Code Section 414(b) and (c) as
modified by Code Section 415(h)), is a member of an affiliated service group (as
defined by Code Section 414(m)), or is a member of a group of entities required
to be aggregated pursuant to Regulations under Code Section 414(o), all
Employees of such Employers shall be considered to be employed by a single
Employer.
(g) For the purpose of this Section, if this Plan is a Code
Section 413(c) plan, each Employer who maintains this Plan will be considered to
be a separate Employer.
(h) (1) If a Participant participates in more than one defined
contribution plan maintained by the Employer which have different Anniversary
Dates, the maximum "annual additions" under this Plan shall equal the maximum
"annual additions" for the "limitation year" minus any "annual additions"
previously credited to such Participant's accounts during the "limitation year."
(2) If a Participant participates in both a defined
contribution plan subject to Code Section 412 and a defined contribution plan
not subject to Code Section 412
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maintained by the Employer which have the same Anniversary Date, "annual
additions" will be credited to the Participant's accounts under the defined
contribution plan subject to Code Section 412 prior to crediting "annual
additions" to the Participant's accounts under the defined contribution plan not
subject to Code Section 412.
(3) If a Participant participates in more than one defined
contribution plan not subject to Code Section 412 maintained by the Employer
which have the same Anniversary Date, the maximum "annual additions" under this
Plan shall equal the product of (a) the maximum "annual additions" for the
"limitation year" minus any "annual additions" previously credited under
subparagraphs (1) or (2) above, multiplied by 03) a fraction (i) the numerator
of which is the "annual additions" which would be credited to such Participant's
accounts under this Plan without regard to the limitations of Code Section 415
and (ii) the denominator of which is such "annual additions" for all plans
described in this subparagraph.
(i) If an Employee is (or has been) a Participant in one or
more defined benefit plans and one or more defined contribution plans maintained
by the Employer, the sum of the defined benefit plan fraction and the defined
contribution plan fraction for any "limitation year" may not exceed 1.0.
(j) The defined benefit plan fraction for any "limitation
year" is a fraction, the numerator of which is the sum of the Participant's
projected annual benefits under all the defined benefit plans (whether or not
terminated) maintained by the Employer, and the denominator of which is the
lesser of 125 percent of the dollar limitation determined for the "limitation
year" under Code Sections 415 (b) and (d) or 140 percent of the highest average
compensation, including any adjustments under Code Section 415(b).
Notwithstanding the above, if the Participant was a Participant as of
the first day of the first "limitation year" beginning after December 31, 1986,
in one or more defined benefit plans maintained by the Employer which were in
existence on May 6, 1986, the denominator of this fraction will not be less than
125 percent of the sum of the annual benefits under such plans which the
Participant had accrued as of the close of the last "limitation year" beginning
before January 1, 1987, disregarding any changes in the terms and conditions of
the plan after May 5, 1986. The preceding sentence applies only if the defined
benefit plans individually and in the aggregate satisfied the requirements of
Code Section 4115 for all "limitation years" beginning before January 1, 1987.
(k) The defined contribution plan fraction for any "limitation
year" is a fraction, the numerator of which is the sum of the annual additions
to the Participant's Account under all the defined contribution plans (whether
or not terminated) maintained by the Employer for the current and all prior
"limitation years" (including the annual additions attributable to the
Participant's nondeductible Employee contributions to all defined benefit plans,
whether or not terminated, maintained by the Employer, and the annual additions
attributable to all welfare benefit funds, as defined in Code Section 419(e),
and individual medical accounts, as defined in Code Section 415(1)(2),
maintained by the Employer), and the denominator of which is the sum of the
maximum aggregate amounts for the current and all prior "limitation years" of
service with the Employer (regardless of whether a defined contribution plan was
maintained by the
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Employer). The maximum aggregate amount in any "limitation year" is the lesser
of 125 percent of the dollar limitation determined under Code Sections 415(b)
and (d) in effect under Code Section 415(c)(1)(a) or 35 percent of the
Participant's Compensation for such year.
If the Employee was a Participant as of the end of the first day of the
first "limitation 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, the numerator of this fraction will be adjusted if the sum of this
fraction and the defined benefit fraction would otherwise exceed 1.0 under the
terms of this Plan. Under the adjustment, an amount equal to the product of (1)
the excess of the sum of the fractions over 1.0 times (2) the denominator of
this fraction, will be permanently subtracted from the numerator of this
fraction. The adjustment is calculated using the fractions as they would be
computed as of the end of the last "limitation year" beginning before January 1,
1987, and disregarding any changes in the terms and conditions of the Plan made
after May 5, 1986, but using the Code Section 415 limitation applicable to the
first "limitation year" beginning on or after January 1, 1987. The annual
addition for any "limitation year" beginning before January 1, 1987 shall not be
recomputed to treat all Employee contributions as annual additions.
(l) Notwithstanding anything contained in this Section to the
contrary, the limitations, adjustments and other requirements prescribed in this
Section shall at all times comply with the provisions of Code Section 415 and
the Regulations thereunder, the terms of which are specifically incorporated
herein by reference.
4.10 ADJUSTMENT FOR EXCESSIVE ANNUAL ADDITIONS
(a) If, as a result of the allocation of Forfeitures, a
reasonable error in estimating a Participant's Compensation, a reasonable error
in determining the amount of elective deferrals (within the meaning of Code
Section 402(g)(3)) that may be made with respect to any Participant under the
limits of Section 4.9 or other facts and circumstances to which Regulation
1.415-6(b)(6) shall be applicable, the "annual additions" under this Plan would
cause the maximum "annual additions" to be exceeded for any Participant, the
Administrator shall (1) distribute any elective deferrals (within the meaning of
Code Section 402(g)(3)) or return any Employee contributions (whether voluntary
or mandatory), and for the distribution of gains attributable to those elective
deferrals and Employee contributions, to the extent that the distribution or
return would reduce the "excess amount" in the Participant's accounts (2) hold
any "excess amount" remaining after the return of any elective deferrals or
voluntary Employee contributions in a "Section 415 suspense account" (3) use the
"Section 415 suspense account" in the next "limitation year" (and succeeding
"limitation years" if necessary) to reduce Employer contributions for that
Participant if that Participant is covered by the Plan as of the end of the
"limitation year," or if the Participant is not so covered, allocate and
reallocate the "Section 415 suspense account" in the next "limitation year" (and
succeeding "limitation years" if necessary) to all Participants in the Plan
before any Employer or Employee contributions which would constitute "annual
additions" are made to the Plan for such "limitation year" (4) reduce Employer
contributions to the Plan for such "limitation year" by the amount of the
"Section 415 suspense account" allocated and reallocated during such "limitation
year."
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(b) For purposes of this Article, "excess amount" for any
Participant for a "limitation year" shall mean the excess, if any, of (1) the
"annual additions" which would be credited to his account under the terms of the
Plan without regard to the limitations of Code Section 415 over (2) the maximum
"annual additions" determined pursuant to Section 4.9.
(c) For purposes of this Section, "Section 415 suspense
account" shall mean an unallocated account equal to the sum of "excess amounts"
for all Participants in the Plan during the "limitation year." The "Section 415
suspense account" shall not share in any earnings or losses of the Trust Fund.
4.11 TRANSFERS FROM QUALIFIED PLANS
(a) With the consent of the Administrator, amounts may be
transferred from other qualified plans by Eligible Employees, provided that the
trust from which such funds are transferred permits the transfer to be made and
the transfer will not jeopardize the tax exempt status of the Plan or Trust or
create adverse tax consequences for the Employer. The amounts transferred shall
be set up in a separate account herein referred to as a "Participant's Rollover
Account." Such account shall be fully Vested at all times and shall not be
subject to Forfeiture for any reason.
(b) Amounts in a Participant's Rollover Account shall be held
by the Trustee pursuant to the provisions of this Plan and may not be withdrawn
by, or distributed to the Participant, in whole or in part, except as provided
in paragraphs (c) and (d) of this Section.
(c) Except as permitted by Regulations (including Regulation
1.411(d)-4), amounts attributable to elective contributions (as defined in
Regulation 1.401(k)-1(g)(3)), including amounts treated as elective
contributions, which are transferred from another qualified plan in a
plan-to-plan transfer shall be subject to the distribution limitations provided
for in Regulation 1.401(k)- 1 (d).
(d) The Administrator, at the election of the Participant,
shall direct the Trustee to distribute all or a portion of the amount credited
to the Participant's Rollover Account. Any distributions of amounts held in a
Participant's Rollover Account shall be made in a manner which is consistent
with and satisfies the provisions of Section 6.5, including, but not limited to,
all notice and consent requirements of Code Sections 417 and 411(a)(11) and the
Regulations thereunder. Furthermore, such amounts shall be considered as part of
a Participant's benefit in determining whether an involuntary cash-out of
benefits without Participant consent may be made.
(e) The Administrator may direct that employee transfers made
after a valuation date be segregated into a separate account for each
Participant in a federally insured savings account, certificate of deposit in a
bank or savings and loan association, money market certificate, or other short
term debt security acceptable to the Trustee until such time as the allocations
pursuant to this Plan have been made, at which time they may remain segregated
or be invested as part of the general Trust Fund, to be determined by the
Administrator.
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(f) For purposes of this Section, the term "qualified plan"
shall mean any tax qualified plan under Code Section 401(a). The term "amounts
transferred from other qualified plans" shall mean: (i) amounts transferred to
this Plan directly from another qualified plan; (ii) distributions from another
qualified plan which are eligible rollover distributions and which are either
transferred by the Employee to this Plan within sixty (60) days following his
receipt thereof or are transferred pursuant to a direct rollover; (iii) amounts
transferred to this Plan from a conduit individual retirement account provided
that the conduit individual retirement account has no assets other than assets
which (a) were previously distributed to the Employee by another qualified plan
as a lump-sum distribution (B) were eligible for tax-free rollover to a
qualified plan and (c) were deposited in such conduit individual retirement
account within sixty (60) days of receipt thereof and other than earnings on
said assets; and (iv) amounts distributed to the Employee from a conduit
individual retirement account meeting the requirements of clause (iii) above,
and transferred by the Employee to this Plan within sixty (60) days of his
receipt thereof from such conduit individual retirement account.
(g) Prior to accepting any transfers to which this Section
applies, the Administrator may require the Employee to establish that the
amounts to be transferred to this Plan meet the requirements of this Section and
may also require the Employee to provide an opinion of counsel satisfactory to
the Employer that the amounts to be transferred meet the requirements of this
Section.
(h) Notwithstanding anything herein to the contrary, a
transfer directly to this Plan from another qualified plan (or a transaction
having the effect of such a transfer) shall only be permitted if it will not
result in the elimination or reduction of any "Section 411 (d)(6) protected
benefit" as described in Section 8.1.
4.12 VOLUNTARY CONTRIBUTIONS
(a) Any voluntary Employee contributions prior to the first
day of the Plan Year beginning in 1987 shall be maintained in each Participant's
Voluntary Contribution Account. The balance in each Participant's Voluntary
Contribution Account shall be fully Vested at all times and shall not be subject
to Forfeiture for any reason.
(b) A Participant may elect to withdraw his voluntary
contributions from his Voluntary Contribution Account and the actual earnings
thereon in a manner which is consistent with and satisfies the provisions of
Section 6.5, including, but not limited to, all notice and consent requirements
of Code Sections 417 and 411(a)(11) and the Regulations thereunder. If the
Administrator maintains sub-accounts with respect to voluntary contributions
(and earnings thereon) which were made on or before a specified date, a
Participant shall be permitted to designate which sub-account shall be the
source for his withdrawal.
(c) At Normal Retirement Date, or such other date when the
Participant or his Beneficiary shall be entitled to receive benefits, the fair
market value of the Voluntary Contribution Account shall be used to provide
additional benefits to the Participant or his Beneficial.
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4.13 DIRECTED INVESTMENT ACCOUNT
(a) Participants may, subject to a procedure established by
the Administrator (the Participant Direction Procedures) and applied in a
uniform nondiscriminatory manner, direct the Trustee to invest all of their
accounts in specific assets, specific funds or other investments permitted under
the Plan and the Participant Direction Procedures. That portion of the interest
of any Participant so directing will thereupon be considered a Participant's
Directed Account.
(b) As of each Valuation Date, all Participant Directed
Accounts shall be charged or credited with the net earnings, gains, losses and
expenses as well as any appreciation or depreciation in the market value using
publicly listed fair market values when available or appropriate.
(1) To the extent that the assets in a Participant's
Directed Account are accounted for as pooled assets or investments, the
allocation of earnings, gains and losses of each Participant's Directed Account
shall be based upon the total amount of funds so invested, in a manner
proportionate to the Participant's share of such pooled investment.
(2) To the extent that the assets in the Participant's
Directed Account are accounted for as segregated assets, the allocation of
earnings, gains and losses from such assets shall be made on a separate and
distinct basis.
(c) The Participant Direction Procedures shall provide an
explanation of the circumstances under which Participants and their
Beneficiaries may give investment instructions, including, but need not be
limited to, the following:
(1) the conveyance of instructions by the Participants and
their Beneficiaries to invest Participant Directed Accounts in Directed
Investments;
(2) the name, address and phone number of the Fiduciary
(and, if applicable, the person or persons designated by the Fiduciary to act on
its behalf) responsible for providing information to the Participant or a
Beneficiary upon request relating to the investments in Directed Investments;
(3) applicable restrictions on transfers to and from any
Designated Investment Alternative;
(4) any restrictions on the exercise of voting, tender and
similar rights related to a Directed Investment by the Participants or their
Beneficiaries;
(5) a description of any transaction fees and expenses
which affect the balances in Participant Directed Accounts in connection with
the purchase or sale of Directed Investments; and
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(6) general procedures for the dissemination of investment
and other information relating to the Designated Investment Alternatives as
deemed necessary or appropriate, including but not limited to a description of
the following:
(i) the investment vehicles available under the
Plan, including specific information regarding any Designated Investment
Alternative;
(ii) any designated Investment Managers; and
(iii) a description of the additional information
which may be obtained upon request from the Fiduciary designated to provide such
information.
(d) Any information regarding investments available under the
Plan, to the extent not required to be described in the Participant Direction
Procedures, may be provided to the Participant in one or more written documents
which are separate from the Participant Direction Procedures and are not thereby
incorporated by reference into this Plan.
(e) The Administrator may, at its discretion, include in or
exclude by amendment or other action from the Participant Direction Procedures
such instructions, guidelines or policies as it deems necessary or appropriate
to ensure proper administration of the Plan, and may interpret the same
accordingly.
ARTICLE V
VALUATIONS
5.1 VALUATION OF THE TRUST FUND
The Administrator shall direct the Trustee, as of each Valuation Date,
to determine the net worth of the assets comprising the Trust Fund as it exists
on the Valuation Date. In determining such net worth, the Trustee shall value
the assets comprising the Trust Fund at their fair market value as of the
Valuation Date and shall deduct all expenses for which the Trustee has not yet
obtained reimbursement from the Employer or the Trust Fund. The Trustee may
update the value of any shares held in the Participant Directed Account by
reference to the number of shares held by that Participant, priced at the market
value as of the Valuation Date.
5.2 METHOD OF VALUATION
In determining the fair market value of securities held in the Trust
Fund which are listed on a registered stock exchange, the Administrator shall
direct the Trustee to value the same at the prices they were last traded on such
exchange preceding the close of business on the Valuation Date. If such
securities were not traded on the Valuation Date, or if the exchange on which
they are traded was not open for business on the Valuation Date, then the
securities shall be valued at the prices at which they were last traded prior to
the Valuation Date. Any unlisted security held in the Trust Fund shall be valued
at its bid price next preceding the close of business on the Valuation Date,
which bid price shall be obtained from a registered broker or an investment
banker. In determining the fair market value of assets other than securities for
which trading or
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bid prices can be obtained, the Trustee may appraise such assets itself, or in
its discretion, employ one or more appraisers for that purpose and rely on the
values established by such appraiser or appraisers.
ARTICLE VI
DETERMINATION AND DISTRIBUTION OF BENEFITS
6.1 DETERMINATION OF BENEFITS UPON RETIREMENT
Every Participant may terminate his employment with the Employer and
retire for the purposes hereof on his Normal Retirement Date or Early Retirement
Date. However, a Participant may postpone the termination of his employment with
the Employer to a later date, in which event the participation of such
Participant in the Plan, including the right to receive allocations pursuant to
Section 4.4, shall continue until his Late Retirement Date. Upon a Participant's
Retirement Date or attainment of his Normal Retirement Date without termination
of employment with the Employer, or as soon thereafter as is practicable, the
Trustee shall distribute, at the election of the Participant, all amounts
credited to such Participant's Combined Account in accordance with Section 6.5.
6.2 DETERMINATION OF BENEFITS UPON DEATH
(a) Upon the death of a Participant before his Retirement Date
or other termination of his employment, all amounts credited to such
Participant's Combined Account shall become fully Vested. The Administrator
shall direct the Trustee, in accordance with the provisions of Sections 6.6 and
6.7, to distribute the value of the deceased Participant's accounts to the
Participant's Beneficiary.
(b) Upon the death of a Former Participant, the Administrator
shall direct the Trustee, in accordance with the provisions of Sections 6.6 and
6.7, to distribute any remaining Vested amounts credited to the accounts of a
deceased Former Participant to such Former Participant's Beneficiary.
(c) Any security interest held by the Plan by reason of an
outstanding loan to the Participant or Former Participant shall be taken into
account in determining the amount of the Pre-Retirement Survivor Annuity.
(d) The Administrator may require such proper proof of death
and such evidence of the fight of any person to receive payment of the value of
the account of a deceased Participant or Former Participant as the Administrator
may deem desirable. The Administrator's determination of death and of the fight
of any person to receive payment shall be conclusive.
(e) Unless otherwise elected in the manner prescribed in
Section 6.6, the Participant's spouse shall receive a death benefit equal to the
Pre-Retirement Survivor Annuity. The Participant may designate a Beneficiary
other than his spouse to receive that portion of his death benefit which is not
payable as a Pre-Retirement Survivor Annuity. The Participant may
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also designate a Beneficiary other than his spouse to receive the Pre-Retirement
Survivor Annuity but only if:
(1) the Participant and his spouse have validly waived the
Pre-Retirement Survivor Annuity in the manner prescribed in Section 6.6, and the
spouse has waived his or her fight to be the Participant's Beneficiary, or
(2) the Participant is legally separated or has been
abandoned (within the meaning of local law) and the Participant has a court
order to such effect (and there is no "qualified domestic relations order" as
defined in Code Section 414(p) which provides otherwise), or
(3) the Participant has no spouse, or
(4) the spouse cannot be located.
In such event, the designation of a Beneficiary shall be made on a form
satisfactory to the Administrator. A Participant may at any time revoke his
designation of a Beneficiary or change his Beneficiary by filing written notice
of such revocation or change with the Administrator. However, the Participant's
spouse must again consent in writing to any change in Beneficiary of that
portion of the death benefit that would otherwise be paid as a Pre-Retirement
Survivor Annuity unless the original consent acknowledged that the spouse had
the fight to limit consent only to a specific Beneficiary and that the spouse
voluntarily elected to relinquish such fight. The Participant may, at any time,
designate a Beneficiary to receive death benefits that are in excess of the
Pre-Retirement Survivor Annuity. In the event no valid designation of
Beneficiary exists at the time of the Participant's death, the death benefit
shall be payable to his estate.
6.3 DETERMINATION OF BENEFITS IN EVENT OF DISABILITY
In the event of a Participant's Total and Permanent Disability prior to
his Retirement Date or other termination of his employment, all amounts credited
to such Participant's Combined Account shall become fully Vested. In the event
of a Participant's Total and Permanent Disability, the Trustee, in accordance
with the provisions of Sections 6.5 and 6.7, shall distribute to such
Participant all amounts credited to such Participant's Combined Account as
though he had retired.
6.4 DETERMINATION OF BENEFITS UPON TERMINATION
(a) If a Participant's employment with the Employer is
terminated for any reason other than death, Total and Permanent Disability or
retirement, such Participant shall be entitled to such benefits as are provided
hereinafter pursuant to this Section 6.4.
Distribution of the funds due to a Terminated Participant shall be made
on the occurrence of an event which would result in the distribution had the
Terminated Participant remained in the employ of the Employer (upon the
Participant's death, Total and Permanent Disability, Early or Normal
Retirement). However, at the election of the Participant, the Administrator
shall direct
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the Trustee to cause the entire Vested portion of the Terminated Participant's
Combined Account to be payable to such Terminated Participant. Any distribution
under this paragraph shall be made in a manner which is consistent with and
satisfies the provisions of Section 6.5, including, but not limited to, all
notice and consent requirements of Code Sections 417 and 411(a)(11) and the
Regulations thereunder.
(b) The Vested portion of any Participant's Account shall be a
percentage of the total amount credited to his Participant's Account determined
on the basis of the Participant's number of Years of Service according to the
following schedules:
Vesting Schedule
Employer Discretionary Contributions
<TABLE>
<CAPTION>
Years of Service Percentage
--------------------- ---------------
<S> <C>
1 20%
2 40%
3 60%
4 80%
5 100%
</TABLE>
Vesting Schedule
Matching Contributions
<TABLE>
<CAPTION>
Years of Service Percentage
--------------------- ---------------
<S> <C>
1 20%
2 40%
3 60%
4 80%
5 100%
</TABLE>
(c) Notwithstanding the vesting schedule above, the Vested
percentage of a Participant's Account shall not be less than the Vested
percentage attained as of the later of the effective date or adoption date of
this amendment and restatement.
(d) Notwithstanding the vesting schedule above, upon the
complete discontinuance of the Employer contributions to the Plan or upon any
full or partial termination of the Plan, all amounts credited to the account of
any affected Participant shall become 100% Vested and shall not thereafter be
subject to Forfeiture.
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(e) A Participant with at least three (3) Years of Service as
of the expiration date of the election period may elect to have his
nonforfeitable percentage computed under the Plan without regard to such
amendment and restatement. If a Participant fails to make such election, then
such Participant shall be subject to the new vesting schedule. The Participant's
election period shall commence on the adoption date of the amendment and shall
end 60 days after the latest of:
(1) the adoption date of the amendment,
(2) the effective date of the amendment, or
(3) the date the Participant receives written notice of
the amendment from the Employer or Administrator.
Except, however, any Employee who was a Participant as of the later of
the effective date or adoption date of this amendment and restatement and who
completed three (3) Years of Service shall be subject to the pre-amendment
vesting schedule provided such schedule is more liberal than the new vesting
schedule.
Pre-Amendment Vesting Schedule
Fifty percent (50%) of the Employer Matching Contribution Account was
100% vested immediately. The remaining 50% of the Employer Matching Contribution
Account was subject to the following schedule:
<TABLE>
<CAPTION>
Years of Service Percentage
--------------------- ---------------
<S> <C>
2 25%
3 50%
4 75%
5 100%
</TABLE>
(f) The computation of a Participant's nonforfeitable
percentage of his interest in the Plan shall not be reduced as the result of any
direct or indirect amendment to this Plan. For this purpose, the Plan shall be
treated as having been amended if the Plan provides for an automatic change in
vesting due to a change in top heavy status. In the event that the Plan is
mended to change or modify any vesting schedule, a Participant with at least
three (3) Years of Service as of the expiration date of the election period may
elect to have his nonforfeitable percentage computed under the Plan without
regard to such amendment. If a Participant fails to make such election, then
such Participant shall be subject to the new vesting schedule. The Participant's
election period shall commence on the adoption date of the amendment and shall
end 60 days after the latest of:
(1) the adoption date of the amendment,
(2) the effective date of the amendment, or
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(3) the date the Participant receives written notice of the
amendment from the Employer or Administrator.
(g) (1) If any Former Participant shall be reemployed by the
Employer before a 1-Year Break in Service occurs, he shall continue to
participate in the Plan in the same manner as if such termination had not
occurred.
(2) If any Former Participant shall be reemployed by the
Employer before five (5) consecutive 1-Year Breaks in Service, and such Former
Participant had received a distribution of his entire Vested interest prior to
his reemployment, his forfeited account shall be reinstated only if he repays
the full amount distributed to him before the earlier of five (5) years after
the first date on which the Participant is subsequently reemployed by the
Employer or the close of the first period of five (5) consecutive 1-Year Breaks
in Service commencing after the distribution. In the event the Former
Participant does repay the full amount distributed to him, the undistributed
portion of the Participant's Account must be restored in full, unadjusted by any
gains or losses occurring subsequent to the Valuation Date coinciding with or
preceding his termination. The source for such reinstatement shall first be any
Forfeitures occurring during the year. If such source is insufficient, then the
Employer shall contribute an amount which is sufficient to restore any such
forfeited Accounts provided, however, that if a discretionary contribution is
made for such year pursuant to Section 4.1 (d), such contribution shall first be
applied to restore any such Accounts and the remainder shall be allocated in
accordance with Section 4.4.
(3) If any Former Participant is reemployed after a 1-Year
Break in Service has occurred, Years of Service shall include Years of Service
prior to his 1-Year Break in Service subject to the following roles:
(i) If a Former Participant has a 1-Year Break in
Service, his pre-break and post-break service shall be used for computing Years
of Service for eligibility and for vesting purposes only after he has been
employed for one (1) Year of Service following the date of his reemployment with
the Employer;
(ii) Any Former Participant who under the Plan does
not have a nonforfeitable right to any interest in the Plan resulting from
Employer contributions shall lose credits otherwise allowable under (i) above if
his consecutive 1-Year Breaks in Service equal or exceed the greater of (a) five
(5) or (b) the aggregate number of his pre-break Years of Service;
(iii) After five (5) consecutive 1-Year Breaks in
Service, a Former Participant's Vested Account balance attributable to pre-break
service shall not be increased as a result of post-break service;
(iv) If a Former Participant is reemployed by the
Employer, he shall participate in the Plan immediately on his date of
reemployment;
(v) If a Former Participant (a 1-Year Break in
Service previously occurred, but employment had not terminated) is credited with
an Hour of Service
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after the first eligibility computation period in which he incurs a 1-Year Break
in Service, he shall participate in the Plan immediately.
6.5 DISTRIBUTION OF BENEFITS
(a) (1) Unless otherwise elected as provided below, a
Participant who is married on the Annuity Starting Date and who does not die
before the Annuity Starting Date shall receive the value of all of his benefits
in the form of a joint and survivor annuity. The joint and survivor annuity is
an annuity that commences immediately and shall be equal in value to a single
life annuity. Such joint and survivor benefits following the Participant's death
shall continue to the spouse during the spouse's lifetime at a rate equal to 50
9; of the rate at which such benefits were payable to the Participant. This
joint and 50% survivor annuity shall be considered the designated qualified
joint and survivor annuity and automatic form of payment for the purposes of
this Plan. However, the Participant may elect to receive a smaller annuity
benefit with continuation of payments to the spouse at a rate of seventy-five
percent (75%) or one hundred percent (100%) of the rate payable to a Participant
during his lifetime, which alternative joint and survivor annuity shall be equal
in value to the automatic joint and 50% survivor annuity. An unmarried
Participant shall receive the value of his benefit in the form of a life
annuity. Such unmarried Participant, however, may elect in writing to waive the
life annuity. The election must comply with the provisions of this Section as if
it were an election to waive the joint and survivor annuity by a married
Participant, but without the spousal consent requirement. The Participant may
elect to have any annuity provided for in this Section distributed upon the
attainment of the "earliest retirement age" under the Plan. The "earliest
retirement age" is the earliest date on which, under the Plan, the Participant
could elect to receive retirement benefits.
(2) Any election to waive the joint and survivor annuity
must be made by the Participant in writing during the election period and be
consented to by the Participant's spouse. If the spouse is legally incompetent
to give consent, the spouse's legal guardian, even if such guardian is the
Participant, may give consent. Such election shall designate a Beneficiary (or a
form of benefits) that may not be changed without spousal consent (unless the
consent of the spouse expressly permits designations by the Participant without
the requirement of further consent by the spouse). Such spouse's consent shall
be irrevocable and must acknowledge the effect of such election and be witnessed
by a Plan representative or a notary public. Such consent shall not be required
if it is established to the satisfaction of the Administrator that the required
consent cannot be obtained because there is no spouse, the spouse cannot be
located, or other circumstances that may be prescribed by Regulations. The
election made by the Participant and consented to by his spouse may be revoked
by the Participant in writing without the consent of the spouse at any time
during the election period. The number of revocations shall not be limited. Any
new election must comply with the requirements of this paragraph. A former
spouse's waiver shall not be binding on a new spouse.
(3) The election period to waive the joint and survivor
annuity shall be the 90 clay period ending on the Annuity Starting Date.
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(4) With regard to the election, the Administrator shall
provide to the Participant no less than 30 days and no more than 90 days before
the Annuity Starting Date a written explanation of:
(i) the terms and conditions of the joint and
survivor annuity,
(ii) the Participant's fight to make, and the
effect of, an election to waive the joint and survivor annuity,
(iii) the fight of the Participant's spouse to
consent to any election to waive the joint and survivor annuity, and
(iv) the fight of the Participant to revoke such
election, and the effect of such revocation.
Notwithstanding the above, if the Participant elects (with spousal
consent) to waive the requirement that the written explanation be provided at
least 30 days before the Annuity Starting Date, the election period shall be
extended to the 30th day after the date on which such explanation is provided to
the Participant.
(5) Any distribution provided for in this Section 6.5 may
commence less than 30 days after the notice required by Code Section 417(a)(3)
or Code Section 417(a)(7) is given, provided that:
(i) the Administrator clearly informs the
Participant that the Participant has a fight to a period of 30 days after
receiving the notice to consider whether to waive the joint and survivor annuity
and consent to a form of distribution other than a joint and survivor annuity,
(ii) the Participant is permitted to revoke an
affirmative distribution election at least until the Annuity Starting Date, or,
if later, at any time prior to the expiration of the 7-day period that begins
the day after the explanation of the joint and survivor annuity is provided to
the Participant, and
(iii) distribution in accordance with the
affirmative election does not commence before the expiration of the 7-day period
that begins the day after the explanation of the joint and survivor annuity is
provided to the Participant.
(b) In the event a married Participant duly elects pursuant to
paragraph (a)(2) above not to receive his benefit in the form of a joint and
survivor annuity, or if such Participant is not married, in the form of a life
annuity, the Administrator, pursuant to the election of the Participant, shall
direct the Trustee to distribute to a Participant or his Beneficiary any amount
to which he is entitled under the Plan in one or more of the following methods:
(1) One lump-sum payment in cash or in property.
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(2) Payments over a period certain in monthly, quarterly,
semiannual, or annual cash installments. In order to provide such installment
payments, the Administrator may (a) segregate the aggregate amount thereof in a
separate, federally insured savings account, certificate of deposit in a bank or
savings and loan association, money market certificate or other liquid
short-term security or (b) purchase a nontransferable annuity contract for a
term certain (with no life contingencies) providing for such payment. The period
over which such payment is to be made shall not extend beyond the Participant's
life expectancy (or the life expectancy of the Participant and his designated
Beneficiary).
(3) Purchase of or providing an annuity. However, such
annuity may not be in any form that will provide for payments over a period
extending beyond either the life of the Participant (or the fives of the
Participant and his designated Beneficiary) or the life expectancy of the
Participant (or the life expectancy of the Participant and his designated
Beneficiary).
(c) The present value of a Participant's joint and survivor
annuity derived from Employer and Employee contributions may not be paid without
his written consent if the value exceeds, or has ever exceeded, $3,500 ($5,000
for Plan Years beginning after August 5, 1997)at the time of any prior
distribution. Further, the spouse of a Participant must consent in writing to
any immediate distribution. Any written consent required by this Section 6.5(c)
must be obtained not more than 90 days before commencement of the distribution
and shall be made in a manner consistent with Section 6.5(a)(2).
(d) The present value of a Participant's joint and survivor
annuity derived from Employer and Employee contributions may not be paid without
his written consent. Further, the spouse of a Participant must consent in
writing to any immediate distribution if the value of the Participant's benefit
exceeds, or has ever exceeded, $3,500 ($5,000 for Plan Years beginning after
August 5, 1997) at the time of any prior distribution. Any written consent
required by this Section 6.5(c) must be obtained not more than 90 days before
commencement of the distribution and shall be made in a manner consistent with
Section 6.5(a)(2).
If the value of the Participant's benefit derived from Employer and
Employee contributions does not exceed $3,500 ($5,000 for Plan Years beginning
after August 5, 1997) and has never exceeded $3,500 or $5,000, whichever is
applicable, at the time of any prior distribution, the Administrator may
immediately distribute such benefit without such Participant's consent. No
distribution may be made under the preceding sentence after the Annuity Starting
Date unless the Participant and his spouse consent in writing to such
distribution.
(e) Any distribution to a Participant who has a benefit which
exceeds, or has ever exceeded, $3,500 ($5,000 for Plan Years beginning after
August 5, 1997) at the time of any prior distribution shall require such
Participant's consent if such distribution commences prior to the later of his
Normal Retirement Age or age 62. With regard to this required consent:
(1) No consent shall be valid unless the Participant has
received a general description of the material features and an explanation of
the relative values of the
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<PAGE> 52
optional forms of benefit available under the Plan that would satisfy the notice
requirements of Code Section 417.
(2) The Participant must be informed of his fight to defer
receipt of the distribution. If a Participant fails to consent, it shall be
deemed an election to defer the commencement of payment of any benefit. However,
any election to defer the receipt of benefits shall not apply with respect to
distributions which are required under Section 6.5(e).
(3) Notice of the rights specified under this paragraph
shall be provided no less than 30 days and no more than 90 days before the
Annuity Starting Date. However, if the Participant elects (with spousal consent)
to waive the requirement that the written explanation be provided at least 30
days before the Annuity Starting Date, the election period shall be extended to
the 30th day after the date on which such explanation is provided to the
Participant.
(4) Written consent of the Participant to the distribution
must not be made before the Participant receives the notice and must not be made
more than 90 days before the Annuity Starting Date.
(5) No consent shall be valid if a significant detriment
is imposed under the Plan on any Participant who does not consent to the
distribution.
Any such distribution may commence less than 30 days, subject to Section
6.5(a)(5), after the notice required under Regulation 1.411(a)-11(c) is given,
provided that: (1) the Administrator clearly informs the Participant that the
Participant has a fight to a period of at least 30 days after receiving the
notice to consider the decision of whether or not to elect a distribution (and,
if applicable, a particular distribution option), and (2) the Participant, after
receiving the notice, affirmatively elects a distribution.
(f) Notwithstanding any provision in the Plan to the contrary,
the distribution of a Participant's benefits, whether under the Plan or through
the purchase of an annuity contract, shall be made in accordance with the
following requirements and shall otherwise comply with Code Section 401(a)(9)
and the Regulations thereunder (including Regulation 1.401(a)(9)-2), the
provisions of which are incorporated herein by reference:
(1) A Participant's benefits shall be distributed or must
begin to be distributed to him not later than April 1st of the calendar year
following the later of (i) the calendar year in which the Participant attains
age 70 1/2 or (ii) the calendar year in which the Participant retires, provided,
however, that this clause (ii) shall not apply in the case of a Participant who
is a "five (5) percent owner" at any time during the five (5) Plan Year period
ending in the calendar year in which he attains age 70 1/2 or, in the case of a
Participant who becomes a "five (5) percent owner" during any subsequent Plan
Year, clause (ii) shall no longer apply and the required beginning date shall be
the April 1st of the calendar year following the calendar year in which such
subsequent Plan Year ends. Such distributions shall be equal to or greater than
any required distribution.
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Alternatively, distributions to a Participant must begin no later than
the applicable April 1st as determined under the preceding paragraph and must be
made over the life of the Participant (or the fives of the Participant and the
Participant's designated Beneficiary) or the life expectancy of the Participant
(or the life expectancies of the Participant and his designated Beneficiary) in
accordance with Regulations.
(2) Distributions to a Participant and his Beneficiaries
shall only be made in accordance with the incidental death benefit requirements
of Code Section 401(a) (9) (g) and the Regulations thereunder.
(g) For purposes of this Section, the life expectancy of a
Participant and a Participant's spouse (other than in the case of a life
annuity) may, at the election of the Participant or the Participant's spouse, be
redetermined in accordance with Regulations. The election, once made, shall be
irrevocable. If no election is made by the time distributions must commence,
then the life expectancy of the Participant and the Participant's spouse shall
not be subject to recalculation. Life expectancy and joint and last survivor
expectancy shall be computed using the return multiples in Tables V and VI of
Regulation 1.72-9.
(h) Subject to the spouse's fight of consent afforded under
the Plan, the restrictions imposed by this Section shall not apply if a
Participant has, prior to January 1, 1984, made a written designation to have
his retirement benefit paid in an alternative method acceptable under Code
Section 401(a) as in effect prior to the enactment of the Tax Equity and Fiscal
Responsibility Act of 1982.
(i) All annuity Contracts under this Plan shall be
non-transferable when distributed. Furthermore, the terms of any annuity
Contract purchased and distributed to a Participant or spouse shall comply with
all of the requirements of the Plan.
(j) If a distribution is made at a time when a Participant is
not fully Vested in his Participant's Account and the Participant may increase
the Vested percentage in such account:
(1) a separate account shall be established for the
Participant's interest in the Plan as of the time of the distribution; and
(2) at any relevant time, the Participant's Vested portion
of the separate account shall be equal to an amount ("X") determined by the
formula:
X equals P(AB plus (R x D)) - (R x D)
For purposes of applying the formula: P is the Vested percentage at the
relevant time, AB is the account balance at the relevant time, D is the amount
of distribution, and R is the ratio of the account balance at the relevant time
to the account balance after distribution.
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6.6 DISTRIBUTION OF BENEFITS UPON DEATH
(a) Unless otherwise elected as provided below, a Vested
Participant who dies before the Annuity Starting Date and who has a surviving
spouse shall have the Pre-Retirement Survivor Annuity paid to his surviving
spouse. The Participant's spouse may direct that payment of the Pre-Retirement
Survivor Annuity commence within a reasonable period after the Participant's
death. If the spouse does not so direct, payment of such benefit will commence
at the time the Participant would have attained the later of his Normal
Retirement Age or age 62. However, the spouse may elect a later commencement
date. Any distribution to the Participant's spouse shall be subject to the roles
specified in Section 6.6(g).
(b) Any election to waive the Pre-Retirement Survivor Annuity
before the Participant's death must be made by the Participant in writing during
the election period and shall require the spouse's irrevocable consent in the
same manner provided for in Section 6.5(a)(2). Further, the spouse's consent
must acknowledge the specific nonspouse Beneficiary. Notwithstanding the
foregoing, the nonspouse Beneficiary need not be acknowledged, provided the
consent of the spouse acknowledges that the spouse has the fight to limit
consent only to a specific Beneficiary and that the spouse voluntarily elects to
relinquish such fight.
(c) The election period to waive the Pre-Retirement Survivor
Annuity shall begin on the first day of the Plan Year in which the Participant
attains age 35 and end on the date of the Participant's death. An earlier waiver
(with spousal consent) may be made provided a written explanation of the
Pre-Retirement Survivor Annuity is given to the Participant and such waiver
becomes invalid at the beginning of the Plan Year in which the Participant turns
age 35. In the event a Vested Participant separates from service prior to the
beginning of the election period, the election period shall begin on the date of
such separation from service.
(d) With regard to the election, the Administrator shall
provide each Participant within the applicable period, with respect to such
Participant (and consistent with Regulations), a written explanation of the
Pre-Retirement Survivor Annuity containing comparable information to that
required pursuant to Section 6.5(a)(4). For the purposes of this paragraph, the
term "applicable period" means, with respect to a Participant, whichever of the
following periods ends last:
(1) The period beginning with the first day of the Plan
Year in which the Participant attains age 32 and ending with the close of the
Plan Year preceding the Plan Year in which the Participant attains age 35;
(2) A reasonable period after the individual becomes a
Participant;
(3) A reasonable period ending after the Plan no longer
fully subsidizes the cost of the Pre-Retirement Survivor Annuity with respect to
the Participant;
(4) A reasonable period ending after Code Section
401(a)(11) applies to the Participant; or
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(5) A reasonable period after separation from service in
the case of a Participant who separates before attaining age 35. For this
purpose, the Administrator must provide the explanation beginning one year
before the separation from service and ending one year after such separation. If
such a Participant thereafter returns to employment with the Employer, the
applicable period for such Participant shall be redetermined.
For purposes of applying this Section 6.6(d), a reasonable period ending
after the enumerated events described in paragraphs (2), (3) and (4) is the end
of the two year period beginning one year prior to the date the applicable event
occurs, and ending one year after that date.
(e) If the aggregate value of the Participant's account
balance derived from Employer and Employee contributions does not exceed $3,500
($5,000 for Plan Years beginning after August 5, 1997) and has never exceeded
$3,500 or $5,000, whichever is applicable, at the time of any prior
distribution, the Administrator shall direct the immediate distribution of the
present value of the Pre-Retirement Survivor Annuity to the Participant's
spouse. No distribution may be made under the preceding sentence after the
Annuity Starting Date unless the spouse consents in writing. If the value
exceeds, or has ever exceeded, $3,500 ($5,000 for Plan Years beginning after
August 5, 1997) at the time of any prior distribution, an immediate distribution
of the entire amount of the Pre-Retirement Survivor Annuity may be made to the
surviving spouse, provided such surviving spouse consents in writing to such
distribution. Any written consent required under this paragraph must be obtained
not more than 90 days before commencement of the distribution and shall be made
in a manner consistent with Section 6.5(a)(2).
(f) (1) To the extent the death benefit is not paid in the
form of a Pre-Retirement Survivor Annuity, it shall be paid to the Participant's
Beneficiary by either of the following methods, as elected by the Participant
(or if no election has been made prior to the Participant's death, by his
Beneficiary), subject to the roles specified in Section 6.6(g):
(i) One lump-sum payment in cash or in property.
(ii) Payment in monthly, quarterly, semi-annual, or
annual cash installments over a period to be determined by the Participant or
his Beneficiary. After periodic installments commence, the Beneficiary shall
have the fight to direct the Trustee to reduce the period over which such
periodic installments shall be made, and the Trustee shall adjust the cash
amount of such periodic installments accordingly.
(2) In the event the death benefit payable pursuant to
Section 6.2 is payable in installments, then, upon the death of the Participant,
the Administrator may direct the Trustee to segregate the death benefit into a
separate account, and the Trustee shall invest such segregated account
separately, and the funds accumulated in such account shall be used for the
payment of the installments.
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(g) Notwithstanding any provision in the Plan to the contrary,
distributions upon the death of a Participant shall be made in accordance with
the following requirements and shall otherwise comply with Code Section
401(a)(9) and the Regulations thereunder. If the death benefit is paid in the
form of a Pre-Retirement Survivor Annuity, then distributions to the
Participant's surviving spouse must commence on or before the later of: (1)
December 31st of the calendar year immediately following the calendar year in
which the Participant died; or (2) December 31st of the calendar year in which
the Participant would have attained age 70 1/2. If it is determined pursuant to
Regulations that the distribution of a Participant's interest has begun and the
Participant dies before his entire interest has been distributed to him, the
remaining portion of such interest shall be distributed at least as rapidly as
under the method of distribution selected pursuant to Section 6.5 as of his date
of death. If a Participant dies before he has begun to receive any distributions
of his interest under the Plan or before distributions are deemed to have begun
pursuant to Regulations (and distributions are not to be made in the form of a
Pre-Retirement Survivor Annuity), then his death benefit shall be distributed to
his Beneficiaries by December 31st of the calendar year in which the fifth
anniversary of his date of death occurs.
However, the 5-year distribution requirement of the preceding paragraph
shall not apply to any portion of the deceased Participant's interest which is
payable to or for the benefit of a designated Beneficiary. In such event, such
portion may, at the election of the Participant (or the Participant's designated
Beneficiary), be distributed over the life of such designated Beneficiary (or
over a period not extending beyond the life expectancy of such designated
Beneficiary) provided such distribution begins not later than December 31st of
the calendar year immediately following the calendar year in which the
Participant died. However, in the event the Participant's spouse (determined as
of the date of the Participant's death) is his Beneficiary, the requirement that
distributions commence within one year of a Participant's death shall not apply.
In lieu thereof, distributions must commence on or before the later of: (1)
December 31st of the calendar year immediately following the calendar year in
which the Participant died; or (2) December 31st of the calendar year in which
the Participant would have attained age 70 1/2. If the surviving spouse dies
before distributions to such spouse begin, then the 5-year distribution
requirement of this Section shall apply as if the spouse was the Participant.
(h) For purposes of Section 6.6(g), the election by a
designated Beneficiary to be excepted from the 5-year distribution requirement
must be made no later than December 31st of the calendar year following the
calendar year of the Participant's death. Except, however, with respect to a
designated Beneficiary who is the Participant's surviving spouse, the election
must be made by the earlier of: (1) December 31st of the calendar year
immediately following the calendar year m which the Participant died or, if
later, the calendar year in which the Participant would have attained age 70
1/2; or (2) December 31st of the calendar year which contains the fifth
anniversary of the date of the Participant's death. An election by a designated
Beneficiary must be in writing and shall be irrevocable as of the last day of
the election period stated herein. In the absence of an election by the
Participant or a designated Beneficiary, the 5-year distribution requirement
shall apply.
(i) For purposes of this Section, the life expectancy of a
Participant and a Participant's spouse (other than in the case of a life
annuity) may, at the election of the
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Participant or the Participant's spouse, be redetermined in accordance with
Regulations. The election, once made, shall be irrevocable. If no election is
made by the time distributions must commence, then the life expectancy of the
Participant and the Participant's spouse shall not be subject to recalculation.
Life expectancy and joint and last survivor expectancy shall be computed using
the return multiples in Tables V and VI of Regulation 1.72-9.
(j) Subject to the spouse's right of consent afforded under
the Plan, the restrictions imposed by this Section shall not apply if a
Participant has, prior to January 1, 1984, made a written designation to have
his death benefits paid in an alternative method acceptable under Code Section
401(a) as in effect prior to the enactment of the Tax Equity and Fiscal
Responsibility Act of 1982.
6.7 TIME OF SEGREGATION OR DISTRIBUTION
Except as limited by Sections 6.5 and 6.6, whenever the Trustee is to
make a distribution or to commence a series of payments the distribution may be
made or begun as soon as is practicable. However, distributions to Highly
Compensated Employees will be made as soon as practicable after the Anniversary
Date following termination of employment. However, unless a Former Participant
elects in writing to defer the receipt of benefits (such election may not result
in a death benefit that is more than incidental), the payment of benefits shall
begin not later than the 60th day after the close of the Plan Year in which the
latest of the following events occurs' (a) the date on which the Participant
attains the earlier of age 65 or the Normal Retirement Age specified herein; (b)
the 10th anniversary of the year in which the Participant commenced
participation in the Plan; or (c) the date the Participant terminates his
service with the Employer.
6.8 DISTRIBUTION FOR MINOR BENEFICIARY
In the event a distribution is to be made to a minor, then the
Administrator may direct that such distribution be paid to the legal guardian,
or if none, to a parent of such Beneficiary or a responsible adult with whom the
Beneficiary maintains his residence, or to the custodian for such Beneficiary
under the Uniform Gift to Minors Act or Gift to Minors Act, if such is permitted
by the laws of the state in which said Beneficiary resides. Such a payment to
the legal guardian, custodian or parent of a minor Beneficiary shall fully
discharge the Trustee, Employer, and Plan from further liability on account
thereof.
6.9 LOCATION OF PARTICIPANT OR BENEFICIARY UNKNOWN
In the event that all, or any portion, of the distribution payable to a
Participant or his Beneficiary hereunder shall, at the later of the
Participant's attainment of age 62 or his Normal Retirement Age, remain unpaid
solely by reason of the inability of the Administrator, after sending a
registered letter, return receipt requested, to the last known address, and
after further diligent effort, to ascertain the whereabouts of such Participant
or his Beneficiary, the amount so distributable shall be treated as a Forfeiture
pursuant to the Plan. In the event a Participant or Beneficiary is located
subsequent to his benefit being reallocated, such benefit shall be restored
unadjusted for earnings or losses.
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6.10 PRE-RETIREMENT DISTRIBUTION
At such time as a Participant shall have attained the age of 59 1/2
years, the Administrator, at the election of the Participant, shall direct the
Trustee to distribute all or a portion of the amount then credited to the
accounts maintained on behalf of the Participant. However, no distribution from
a segregated portion of the Participant's Account shall occur prior to 100%
vesting of such segregated portion. In the event that the Administrator makes
such a distribution, the Participant shall continue to be eligible to
participate in the Plan on the same basis as any other Employee. Any
distribution made pursuant to this Section shall be made in a manner consistent
with Section 6.5, including, but not limited to, all notice and consent
requirements of Code Sections 417 and 411 (a)(11) and the Regulations
thereunder.
Notwithstanding the above, pre-retirement distributions from a
Participant's Elective Account shall not be permitted prior to the Participant
attaining age 59 1/2 except as otherwise permitted under the terms of the Plan.
Notwithstanding the above, pre-retirement distributions from a
Participant's Voluntary Contribution Account and Rollover Account shall be
permitted at any time at the election of the Participant.
6.11 ADVANCE DISTRIBUTION FOR HARDSHIP
(a) The Administrator, at the election of the Participant,
shall direct the Trustee to distribute to any Participant in any one Plan Year
up to the lesser of 100% of his Participant's Elective Account and Participant's
Account valued as of the last Valuation Date or the amount necessary to satisfy
the immediate and heavy financial need of the Participant. Any distribution made
pursuant to this Section shall be deemed to be made as of the first day of the
Plan Year or, if later, the Valuation Date immediately preceding the date of
distribution, and the Participant's Elective Account and Participant's Account
shall be reduced accordingly. Withdrawal under this Section shall be authorized
only if the distribution is on account of:
(1) Expenses for medical care described in Code Section
213(d) previously incurred by the Participant, his spouse, or any of his
dependents (as defined in Code Section 152) or necessary for these persons to
obtain medical care;
(2) The costs directly related to the purchase of a
principal residence for the Participant (excluding mortgage payments);
(3) Payment of tuition, related educational fees, and room
and board expenses for the next twelve (12) months of post-secondary education
for the Participant, his spouse, children, or dependents; or
(4) Payments necessary to prevent the eviction of the
Participant from his principal residence or foreclosure on the mortgage of the
Participant's principal residence.
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(b) No such distribution shall be made from the Participant's
Account until such Account has become fully Vested.
(c) No distribution shall be made pursuant to this Section
unless the Administrator, based upon the Participant's representation and such
other facts as are known to the Administrator, determines that all of the
following conditions are satisfied:
(1) The distribution is not in excess of the amount of the
immediate and heavy financial need of the Participant. The amount of the
immediate and heavy financial need may include any amounts necessary to pay any
federal, state, or local income taxes or penalties reasonably anticipated to
result from the distribution;
(2) The Participant has obtained all distributions, other
than hardship distributions, and all nontaxable (at the time of the loan) loans
currently available under all plans maintained by the Employer;
(3) The Plan, and all other plans maintained by the
Employer, provide that the Participant's elective deferrals and voluntary
Employee contributions will be suspended for at least twelve (12) months after
receipt of the hardship distribution or, the Participant, pursuant to a legally
enforceable agreement, will suspend his elective deferrals and voluntary
Employee contributions to the Plan and all other plans maintained by the
Employer for at least twelve (12) months after receipt of the hardship
distribution; and
(4) The Plan, and all other plans maintained by the
Employer, provide that the Participant may not make elective deferrals for the
Participant's taxable year immediately following the taxable year of the
hardship distribution in excess of the applicable limit under Code Section
402(g) for such next taxable year less the amount of such Participant's elective
deferrals for the taxable year of the hardship distribution.
(d) Notwithstanding the above, distributions from the
Participant's Elective Account pursuant to this Section shall be limited, as of
the date of distribution, to the Participant's Elective Account as of the end of
the last Plan Year ending before July 1, 1989, plus the total Participant's
Deferred Compensation after such date, reduced by the amount of any previous
distributions pursuant to this Section and Section 6.10.
(e) Any distribution made pursuant to this Section shall be
made in a manner which is consistent with and satisfies the provisions of
Section 6.5, including, but not limited to, all notice and consent requirements
of Code Sections 417 and 411 (a) (11) and the Regulations thereunder.
6.12 QUALIFIED DOMESTIC RELATIONS ORDER DISTRIBUTION
All rights and benefits, including elections, provided to a Participant
in this Plan shall be subject to the rights afforded to any "alternate payee"
under a "qualified domestic relations order." Furthermore, a distribution to an
"alternate payee" shall be permitted if such distribution is authorized by a
"qualified domestic relations order," even if the affected Participant has not
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separated from service and has not reached the "earliest retirement age" under
the Plan. For the purposes of this Section, "alternate payee," "qualified
domestic relations order" and "earliest retirement age" shall have the meaning
set forth under Code Section 414(p).
ARTICLE VII
TRUSTEE
7.1 BASIC RESPONSIBILITIES OF THE TRUSTEE
(a) The Trustee shall have the following categories of
responsibilities:
(1) Consistent with the "funding policy and method"
determined by the Employer, to invest, manage, and control the Plan assets
subject, however, to the direction of a Participant with respect to his
Participant Directed Accounts, the Employer or an Investment Manager if the
Trustee should appoint such manager as to all or a portion of the assets of the
Plan;
(2) At the direction of the Administrator, to pay benefits
required under the Plan to be paid to Participants, or, in the event of their
death, to their Beneficiaries; and
(3) To maintain records of receipts and disbursements and
furnish to the Employer and/or Administrator for each Plan Year a written annual
report per Section 7.7.
(b) In the event that the Trustee shall be directed by a
Participant (pursuant to the Participant Direction Procedures), or the Employer,
or an Investment Manager with respect to the investment of any or all Plan
assets, the Trustee shall have no liability with respect to the investment of
such assets, but shall be responsible only to execute such investment
instructions as so directed.
(1) The Trustee shall be entitled to rely fully on the
written instructions of a Participant (pursuant to the Participant Direction
Procedures), or the Employer, or any Fiduciary or nonfiduciary agent of the
Employer, in the discharge of such duties, and shall not be liable for any loss
or other liability, resulting from such direction (or lack of direction) of the
investment of any part of the Plan assets.
(2) The Trustee may delegate the duty to execute such
instructions to any nonfiduciary agent, which may be an affiliate of the Trustee
or any Plan representative.
(3) The Trustee may refuse to comply with any direction
from the Participant in the event the Trustee, in its sole and absolute
discretion, deems such directions improper by virtue of applicable law. The
Trustee shall not be responsible or liable for any loss or expense which may
result from the Trustee's refusal or failure to comply with any directions from
the Participant.
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(4) Any costs and expenses related to compliance with the
Participant's directions shall be borne by the Participant's Directed Account,
unless paid by the Employer.
(c) If there shall be more than one Trustee, they shall act by
a majority of their number, but may authorize one or more of them to sign papers
on their behalf.
7.2 INVESTMENT POWERS AND DUTIES OF THE TRUSTEE
(a) The Trustee shall invest and reinvest the Trust Fund to
keep the Trust Fund invested without distinction between principal and income
and in such securities or property, real or personal, wherever situated, as the
Trustee shall deem advisable, including, but not limited to, stocks, common or
preferred, bonds and other evidences of indebtedness or ownership, and real
estate or any interest therein. The Trustee shall at all times in making
investments of the Trust Fund consider, among other factors, the short and
long-term financial needs of the Plan on the basis of information furnished by
the Employer. In making such investments, the Trustee shall not be restricted to
securities or other property of the character expressly authorized by the
applicable law for trust investments; however, the Trustee shall give due regard
to any limitations imposed by the Code or the Act so that at all times the Plan
may qualify as a qualified Profit Sharing Plan and Trust.
(b) The Trustee may employ a bank or trust company pursuant to
the terms of its usual and customary bank agency agreement, under which the
duties of such bank or trust company shall be of a custodial, clerical and
record-keeping nature.
(c) With respect to any Employer stock which is allocated to a
Participant's Directed Investment Account, the Participant or Beneficiary shall
direct the Trustee with regard to any voting, tender and similar rights
associated with the ownership of Employer stock, (i.e., the "Stock Right(s)") as
follows:
(1) Each Participant or Beneficiary shall direct the
Trustee to vote or otherwise exercise such Stock Rights in accordance with the
provisions, conditions and terms of any such Stock Right(s).
(2) Such directions shall be provided to the Trustee by
the Participant or Beneficiary in accordance with the procedure as established
by the Administrator. The Trustee shall vote or otherwise exercise such Stock
Right(s) with respect to which it has received directions to do so under this
Section.
(3) To the extent to which a Participant or Beneficiary
does not instruct the Trustee or does not issue valid directions to the Trustee
to vote or otherwise exercise such Stock Right(s), such Participants or
Beneficiaries shall be deemed to have directed the Trustee that such Stock
Rights remain nonvoted and unexercised.
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7.3 OTHER POWERS OF THE TRUSTEE
The Trustee, in addition to all powers and authorities under common law,
statutory authority, including the Act, and other provisions of the Plan, shall
have the following powers and authorities, to be exercised in the Trustee's sole
discretion:
(a) To purchase, or subscribe for, any securities or other
property and to retain the same. In conjunction with the purchase of securities,
margin accounts may be opened and maintained;
(b) To sell, exchange, convey, transfer, grant options to
purchase, or otherwise dispose of any securities or other property held by the
Trustee, by private contract or at public auction. No person dealing with the
Trustee shall be bound to see to the application of the purchase money or to
inquire into the validity, expediency, or propriety of any such sale or other
disposition, with or without advertisement;
(c) To vote upon any stocks, bonds, or other securities; to
give general or special proxies or powers of attorney with or without power of
substitution; to exercise any conversion privileges, subscription rights or
other options, and to make any payments incidental thereto; to oppose, or to
consent to, or otherwise participate in, corporate reorganizations or other
changes affecting corporate securities, and to delegate discretionary powers,
and to pay any assessments or charges in connection therewith; and generally to
exercise any of the powers of an owner with respect to stocks, bonds,
securities, or other property. However, the Trustee shall not vote proxies
relating to securities for which it has not been assigned full investment
management responsibilities. In those cases where another party has such
investment authority or discretion, the Trustee will deliver all proxies to said
party who will then have full responsibility for voting those proxies;
(d) To cause any securities or other property to be registered
in the Trustee's own name or in the name of one or more of the Trustee's
nominees, and to hold any investments in bearer form, but the books and records
of the Trustee shall at all times show that all such investments are part of the
Trust Fund;
(e) To borrow or raise money for the purposes of the Plan in
such amount, and upon such terms and conditions, as the Trustee shall deem
advisable; and for any sum so borrowed, to issue a promissory note as Trustee,
and to secure the repayment thereof by pledging all, or any part, of the Trust
Fund; and no person lending money to the Trustee shall be bound to see to the
application of the money lent or to inquire into the validity, expediency, or
propriety of any borrowing;
(f) To keep such portion of the Trust Fund in cash or cash
balances as the Trustee may, from time to time, deem to be in the best interests
of the Plan, without liability for interest thereon;
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(g) To accept and retain for such time as the Trustee may deem
advisable any securities or other property received or acquired as Trustee
hereunder, whether or not such securities or other property would normally be
purchased as investments hereunder;
(h) To make, execute, acknowledge, and deliver any and all
documents of transfer and conveyance and any and all other instruments that may
be necessary or appropriate to carry out the powers herein granted;
(i) To settle, compromise, or submit to arbitration any
claims, debts, or damages due or owing to or from the Plan, to commence or
defend suits or legal or administrative proceedings, and to represent the Plan
in all suits and legal and administrative proceedings;
(j) To employ suitable agents and counsel and to pay their
reasonable expenses and compensation, and such agent or counsel may or may not
be agent or counsel for the Employer;
(k) To apply for and procure from responsible insurance
companies, to be selected by the Administrator, as an investment of the Trust
Fund such annuity, or other Contracts (on the life of any Participant) as the
Administrator shall deem proper; to exercise, at any time or from time to time,
whatever rights and privileges may be granted under such annuity, or other
Contracts; to collect, receive, and settle for the proceeds of all such annuity
or other Contracts as and when entitled to do so under the provisions thereof;
(l) To invest funds of the Trust in time deposits or savings
accounts bearing a reasonable rate of interest in the Trustee's bank;
(m) To invest in Treasury Bills and other forms of United
States government obligations;
(n) To invest in shares of investment companies registered
under the Investment Company Act of 1940;
(o) To sell, purchase and acquire put or call options if the
options are traded on and purchased through a national securities exchange
registered under the Securities Exchange Act of 1934, as amended, or, if the
options are not traded on a national securities exchange, are guaranteed by a
member firm of the New York Stock Exchange;
(p) To deposit monies in federally insured savings accounts or
certificates of deposit in banks or savings and loan associations;
(q) To pool all or any of the Trust Fund, from time to time,
with assets belonging to any other qualified employee pension benefit trust
created by the Employer or an affiliated company of the Employer, and to
commingle such assets and make joint or common investments and carry joint
accounts on behalf of this Plan and such other trust or trusts,
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allocating undivided shares or interests in such investments or accounts or any
pooled assets of the two or more trusts in accordance with their respective
interests;
(r) To appoint a nonfiduciary agent or agents to assist the
Trustee in carrying out any investment instructions of Participants and of any
Investment Manager or Fiduciary, and to compensate such agent(s) from the assets
of the Plan, to the extent not paid by the Employer;
(s) To do all such acts and exercise all such rights and
privileges, although not specifically mentioned herein, as the Trustee may deem
necessary to carry out the purposes of the Plan.
7.4 LOANS TO PARTICIPANTS
(a) The Trustee may, in the Trustee's discretion, make loans
to Participants and Beneficiaries under the following circumstances' (1) loans
shall be made available to all Participants and Beneficiaries on a reasonably
equivalent basis; (2) loans shall not be made available to Highly Compensated
Employees in an amount greater than the amount made available to other
Participants and Beneficiaries; (3) loans shall bear a reasonable rate of
interest; (4)loans shall be adequately secured; and (5) shall provide for
repayment over a reasonable period of time.
(b) Loans made pursuant to this Section (when added to the
outstanding balance of all other loans made by the Plan to the Participant)
shall be limited to the lesser of:
(1) $50,000 reduced by the excess (if any) of the highest
outstanding balance of loans from the Plan to the Participant during the one
year period ending on the day before the date on which such loan is made, over
the outstanding balance of loans from the Plan to the Participant on the date on
which such loan was made, or
(2) one-half (1/2) of the present value of the
non-forfeitable accrued benefit of the Participant under the Plan.
For purposes of this limit, all plans of the Employer shall be
considered one plan. Additionally, with respect to any loan made prior to
January 1, 1987, the $50,000 limit specified in (1) above shall be unreduced.
(c) Loans shall provide for level amortization with payments
to be made not less frequently than quarterly over a period not to exceed five
(5) years. However, loans used to acquire any dwelling unit which, within a
reasonable time, is to be used (determined at the time the loan is made) as a
principal residence of the Participant shall provide for periodic repayment over
a reasonable period of time that may exceed five (5) years. For this purpose, a
principal residence has the same meaning as a principal residence under Code
Section 1034. Notwithstanding the foregoing, loans made prior to January 1, 1987
which are used to acquire, construct, reconstruct or substantially rehabilitate
any dwelling unit which, within a reasonable period of time is to be used
(determined at the time the loan is made) as a principal residence of the
Participant or a member of his family (within the meaning of Code Section
267(c)(4)) may
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provide for periodic repayment over a reasonable period of time that may exceed
five (5) years. Additionally, loans made prior to January 1, 1987, may provide
for periodic payments which are made less frequently than quarterly and which do
not necessarily result in level amortization. Loan repayments will be suspended
under this Plan as permitted under Code Section 414(u)(4).
(d) Any loan made pursuant to this Section after August 18,
1985 where the Vested interest of the Participant is used to secure such loan
shall require the written consent of the Participant's spouse in a manner
consistent with Section 6.5(a). Such written consent must be obtained within the
90-day period prior to the date the loan is made. However, no spousal consent
shall be required under this paragraph if the total accrued benefit subject to
the security is not in excess of $3,500 ($5,000 for Plan Years beginning after
August 5, 1997).
(e) Any loans granted or renewed on or after the last day of
the first Plan Year beginning after December 31, 1988 shall be made pursuant to
a Participant loan program. Such loan program shall be established in writing
and must include, but need not be limited to, the following:
(1) the identity of the person or positions authorized to
administer the Participant loan program;
(2) a procedure for applying for loans;
(3) the basis on which loans will be approved or denied;
(4) limitations, if any, on the types and amounts of loans
offered;
(5) the procedure under the program for determining a
reasonable rate of interest;
(6) the types of collateral which may secure a Participant
loan; and
(7) the events constituting default and the steps that
will be taken to preserve Plan assets.
Such Participant loan program shall be contained in a separate written
document which, when properly executed, is hereby incorporated by reference and
made a part of the Plan. Furthermore, such Participant loan program may be
modified or amended in writing from time to time without the necessity of
amending this Section.
7.5 DUTIES OF THE TRUSTEE REGARDING PAYMENTS
At the direction of the Administrator, the Trustee shall, from time to
time, in accordance with the terms of the Plan, make payments out of the Trust
Fund. The Trustee shall not be responsible in any way for the application of
such payments.
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7.6 TRUSTEE'S COMPENSATION AND EXPENSES AND TAXES
The Trustee shall be paid such reasonable compensation as shall from
time to time be agreed upon in writing by the Employer and the Trustee. An
individual serving as Trustee who already receives full-time pay from the
Employer shall not receive compensation from the Plan. In addition, the Trustee
shall be reimbursed for any reasonable expenses, including reasonable counsel
fees incurred by it as Trustee. Such compensation and expenses shall be paid
from the Trust Fund unless paid or advanced by the Employer. All taxes of any
kind and all kinds whatsoever that may be levied or assessed under existing or
furore laws upon, or in respect of, the Trust Fund or the income thereof, shall
be paid from the Trust Fund.
7.7 ANNUAL REPORT OF THE TRUSTEE
Within a reasonable period of time after the later of the Anniversary
Date or receipt of the Employer contribution for each Plan Year, the Trustee
shall furnish to the Employer and Administrator a written statement of account
with respect to the Plan Year for which such contribution was made setting
forth:
(a) the net income, or loss, of the Trust Fund;
(b) the gains, or losses, realized by the Trust Fund upon sales
or other disposition of the assets;
(c) the increase, or decrease, in the value of the Trust Fund;
(d) all payments and distributions made from the Trust Fund; and
(e) such further information as the Trustee and/or Administrator
deems appropriate. The Employer, forthwith upon its receipt of each such
statement of account, shall acknowledge receipt thereof in writing and advise
the Trustee and/or Administrator of its approval or disapproval thereof. Failure
by the Employer to disapprove any such statement of account within thirty (30)
days after its receipt thereof shall be deemed an approval thereof. The approval
by the Employer of any statement of account shall be binding as to all matters
embraced therein as between the Employer and the Trustee to the same extent as
if the account of the Trustee had been settled by judgment or decree in an
action for a judicial settlement of its account in a court of competent
jurisdiction in which the Trustee, the Employer and all persons having or
claiming an interest in the Plan were parties; provided, however, that nothing
herein contained shall deprive the Trustee of its fight to have its accounts
judicially settled if the Trustee so desires.
7.8 AUDIT
(a) If an audit of the Plan's records shall be required by the
Act and the regulations thereunder for any Plan Year, the Administrator shall
direct the Trustee to engage on behalf of all Participants an independent
qualified public accountant for that purpose. Such accountant shall, after an
audit of the books and records of the Plan in accordance with generally
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accepted auditing standards, within a reasonable period after the close of the
Plan Year, furnish to the Administrator and the Trustee a report of his audit
setting forth his opinion as to whether any statements, schedules or lists that
are required by Act Section 103 or the Secretary of Labor to be fried with the
Plan's annual report, are presented fairly in conformity with generally accepted
accounting principles applied consistently. All auditing and accounting fees
shall be an expense of and may, at the election of the Administrator, be paid
from the Trust Fund.
(b) If some or all of the information necessary to enable the
Administrator to comply with Act Section 103 is maintained by a bank, insurance
company, or similar institution, regulated and supervised and subject to
periodic examination by a state or federal agency, it shall transmit and certify
the accuracy of that information to the Administrator as provided in Act Section
103(b) within one hundred twenty (120) days after the end of the Plan Year or by
such other date as may be prescribed under regulations of the Secretary of
Labor.
7.9 RESIGNATION, REMOVAL AND SUCCESSION OF TRUSTEE
(a) The Trustee may resign at any time by delivering to the
Employer, at least thirty (30) days before its effective date, a written notice
of his resignation.
(b) The Employer may remove the Trustee by mailing by
registered or certified mail, addressed to such Trustee at his last known
address, at least thirty (30) days before its effective date, a written notice
of his removal.
(c) Upon the death, resignation, incapacity, or removal of any
Trustee, a successor may be appointed by the Employer; and such successor, upon
accepting such appointment in writing and delivering same to the Employer,
shall, without further act, become vested with all the estate, rights, powers,
discretions, and duties of his predecessor with like respect as if he were
originally named as a Trustee herein. Until such a successor is appointed, the
remaining Trustee or Trustees shall have full authority to act under the terms
of the Plan.
(d) The Employer may designate one or more successors prior to
the death, resignation, incapacity, or removal of a Trustee. In the event a
successor is so designated by the Employer and accepts such designation, the
successor shall, without further act, become vested with all the estate, rights,
powers, discretions, and duties of his predecessor with the like effect as if he
were originally named as Trustee herein immediately upon the death, resignation,
incapacity, or removal of his predecessor.
(e) Whenever any Trustee hereunder ceases to serve as such, he
shall furnish to the Employer and Administrator a written statement of account
with respect to the portion of the Plan Year during which he served as Trustee.
This statement shall be either (i) included as part of the annual statement of
account for the Plan Year required under Section 7.7 or (ii) set forth in a
special statement. Any such special statement of account should be rendered to
the Employer no later than the due date of the annual statement of account for
the Plan Year. The procedures set forth in Section 7.7 for the approval by the
Employer of annual statements of account shall apply to any special statement of
account rendered hereunder and approval by the Employer of any such special
statement in the manner provided in Section 7.7 shall have the
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same effect upon the statement as the Employer's approval of an annual statement
of account. No successor to the Trustee shall have any duty or responsibility to
investigate the acts or transactions of any predecessor who has rendered all
statements of account required by Section 7.7 and this subparagraph.
7.10 TRANSFER OF INTEREST
Notwithstanding any other provision contained in this Plan, the Trustee
at the direction of the Administrator shall transfer the Vested interest, if
any, of such Participant in his account to another trust forming part of a
pension, profit sharing or stock bonus plan maintained by such Participant's new
employer and represented by said employer in writing as meeting the requirements
of Code Section 401(a), provided that the trust to which such transfers are made
permits the transfer to be made.
7.11 DIRECT ROLLOVER
(a) Notwithstanding any provision of the Plan to the contrary
that would otherwise limit a distributee's election under this Section, a
distributee may elect, at the time and in the manner prescribed by the
Administrator, to have any portion of an eligible rollover distribution that is
equal to at least $200 paid directly to an eligible retirement plan specified by
the distributee in a direct rollover.
(b) For purposes of this Section the following definitions
shall apply:
(1) An eligible rollover distribution is any distribution
of all or any portion of the balance to the credit of the distributee, except
that an eligible rollover distribution does not include: any distribution that
is one of a series of substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the distributee or the
joint lives (or joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a specified period of ten years or
more; any distribution to the extent such distribution is required under Code
Section 401(a)(9); the portion of any other distribution that is not includible
in gross income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities); and any other distribution
that is reasonably expected to total less than $200 during a year.
(2) 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.
(3) A distributee includes an Employee or former Employee.
In addition, the Employee's or former Employee's surviving spouse and the
Employee's or former Employee's spouse or former spouse who is the alternate
payee under a qualified domestic
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relations order, as defined in Code Section 414(p), are distributees with regard
to the interest of the spouse or former spouse.
(4) A direct rollover is a payment by the Plan to the
eligible retirement plan specified by the distributee.
7.12 EMPLOYER SECURITIES AND REAL PROPERTY
The Trustee shall be empowered to acquire and hold "qualifying Employer
securities" and "qualifying Employer real property," as those terms are defined
in the Act, provided, however, that the Trustee shall not be permitted to
acquire any qualifying Employer securities or qualifying Employer real property
if, immediately after the acquisition of such securities or property, the fair
market value of all qualifying Employer securities and qualifying Employer real
property held by the Trustee hereunder should amount to more than 100% of the
fair market value of all the assets in the Trust Fund.
ARTICLE VIII
AMENDMENT, TERMINATION AND MERGERS
8.1 AMENDMENT
(a) The Employer shall have the fight at any time to amend the
Plan, subject to the limitations of this Section. However, any amendment which
affects the rights, duties or responsibilities of the Trustee and Administrator,
other than an amendment to remove the Trustee or Administrator, may only be made
with the Trustee's and Administrator's written consent. Any such amendment shall
become effective as provided therein upon its execution. The Trustee shall not
be required to execute any such amendment unless the Trust provisions contained
herein are a part of the Plan and the amendment affects the duties of the
Trustee hereunder.
(b) No amendment to the Plan shall be effective if it
authorizes or permits any part of the Trust Fund (other than such part as is
required to pay taxes and administration expenses) to be used for or diverted to
any purpose other than for the exclusive benefit of the Participants or their
Beneficiaries or estates; or causes any reduction in the amount credited to the
account of any Participant; or causes or permits any portion of the Trust Fund
to revert to or become property of the Employer.
(c) Except as permitted by Regulations, no Plan amendment or
transaction having the effect of a Plan amendment (such as a merger, plan
transfer or similar transaction) shall be effective to the extent it eliminates
or reduces any "Section 411(d)(6) protected benefit" or adds or modifies
conditions relating to "Section 411(d)(6) protected benefits" the result of
which is a further restriction on such benefit unless such protected benefits
are preserved with respect to benefits accrued as of the later of the adoption
date or effective date of the amendment. "Section 411(d)(6) protected benefits"
are benefits described in Code Section 411(d) (6) (a) , early retirement
benefits and retirement-type subsidies, and optional forms of benefit.
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8.2 TERMINATION
(a) The Employer shall have the fight at any time to terminate
the Plan by delivering to the Trustee and Administrator written notice of such
termination. Upon any full or partial termination, all amounts credited to the
affected Participants' Combined Accounts shall become 100% Vested as provided in
Section 6.4 and shall not thereafter be subject to forfeiture, and all
unallocated amounts shall be allocated to the accounts of all Participants in
accordance with the provisions hereof.
(b) Upon the full termination of the Plan, the Employer shall
direct the distribution of the assets of the Trust Fund to Participants in a
manner which is consistent with and satisfies the provisions of Section 6.5.
Distributions to a Participant shall be made in cash or in property or through
the purchase of irrevocable nontransferable deferred commitments from an
insurer. Except as permitted by Regulations, the termination of the Plan shall
not result in the reduction of "Section 411(d)(6) protected benefits" in
accordance with Section 8.1 (c).
8.3 MERGER OR CONSOLIDATION
This Plan and Trust may be merged or consolidated with, or its assets
and/or liabilities may be transferred to any other plan and trust only if the
benefits which would be received by a Participant of this Plan, in the event of
a termination of the plan immediately after such transfer, merger or
consolidation, are at least equal to the benefits the Participant would have
received if the Plan had terminated immediately before the transfer, merger or
consolidation, and such transfer, merger or consolidation does not otherwise
result in the elimination or reduction of any "Section 411 (d)(6) protected
benefits" in accordance with Section 8.1 (c).
ARTICLE IX
TOP HEAVY
9.1 TOP HEAVY PLAN REQUIREMENTS
For any Top Heavy Plan Year, the Plan shall provide the special vesting
requirements of Code Section 416(b) pursuant to Section 6.4 of the Plan and the
special minimum allocation requirements of Code Section 416(c) pursuant to
Section 4.4 of the Plan.
9.2 DETERMINATION OF TOP HEAVY STATUS
(a) This Plan shall be a Top Heavy Plan for any Plan Year in
which, as of the Determination Date, (1) the Present Value of Accrued Benefits
of Key Employees and (2) the sum of the Aggregate Accounts of Key Employees
under this Plan and all plans of an Aggregation Group, exceeds sixty percent
(60%) of the Present Value of Accrued Benefits and the Aggregate Accounts of all
Key and Non-Key Employees under this Plan and all plans of an Aggregation Group.
If any Participant is a Non-Key Employee for any Plan Year, but such
Participant was a Key Employee for any prior Plan Year, such Participant's
Present Value of Accrued Benefit
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and/or Aggregate Account balance shall not be taken into account for purposes of
determining whether this Plan is a Top Heavy or Super Top Heavy Plan (or whether
any Aggregation Group which includes this Plan is a Top Heavy Group). In
addition, if a Participant or Former Participant has not performed any services
for any Employer maintaining the Plan at any time during the five year period
ending on the Determination Date, any accrued benefit for such Participant or
Former Participant shall not be taken into account for the purposes of
determining whether this Plan is a Top Heavy or Super Top Heavy Plan.
(b) This Plan shall be a Super Top Heavy Plan for any Plan
Year in which, as of the Determination Date, (1) the Present Value of Accrued
Benefits of Key Employees and (2) the sum of the Aggregate Accounts of Key
Employees under this Plan and all plans of an Aggregation Group, exceeds ninety
percent (90%) of the Present Value of Accrued Benefits and the Aggregate
Accounts of all Key and Non-Key Employees under this Plan and all plans of an
Aggregation Group.
(c) Aggregate Account: A Participant's Aggregate Account as of
the Determination Date is the sum of:
(1) his Participant's Combined Account balance as of the
most recent valuation occurring within a twelve (12) month period ending on the
Determination Date;
(2) an adjustment for any contributions due as of the
Determination Date. Such adjustment shall be the amount of any contributions
actually made after the Valuation Date but due on or before the Determination
Date, except for the first Plan Year when such adjustment shall also reflect the
amount of any contributions made after the Determination Date that are allocated
as of a date in that first Plan Year.
(3) any Plan distributions made within the Plan Year that
includes the Determination Date or within the four (4) preceding Plan Years.
However, in the case of distributions made after the Valuation Date and prior to
the Determination Date, such distributions are not included as distributions for
top heavy purposes to the extent that such distributions are already included in
the Participant's Aggregate Account balance as of the Valuation Date.
Notwithstanding anything herein to the contrary, all distributions, including
distributions made prior to January 1, 1984, and distributions under a
terminated plan which if it had not been terminated would have been required to
be included in an Aggregation Group, will be counted. Further, distributions
from the Plan (including the cash value of life insurance policies) of a
Participant's account balance because of death shall be treated as a
distribution for the purposes of this paragraph.
(4) any Employee contributions, whether voluntary or
mandatory. However, amounts attributable to tax deductible qualified voluntary
employee contributions shall not be considered to be a part of the Participant's
Aggregate Account balance.
(5) with respect to unrelated rollovers and plan-to-plan
transfers (ones which are both initiated by the Employee and made from a plan
maintained by one employer to a plan maintained by another employer), if this
Plan provides the rollovers or plan-to-plan
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transfers, it shall always consider such rollovers or plan-to-plan transfers as
a distribution for the purposes of this Section. If this Plan is the plan
accepting such rollovers or plan-to-plan transfers, it shall not consider such
rollovers or plan-to-plan transfers as part of the Participant's Aggregate
Account balance. However, rollovers or plan-to-plan transfers accepted prior to
January 1, 1984 shall be considered as part of the Participant's Aggregate
Account balance.
(6) with respect to related rollovers and plan-to-plan
transfers (ones either not initiated by the Employee or made to a plan
maintained by the same employer), if this Plan provides the rollover or
plan-to-plan transfer, it shall not be counted as a distribution for purposes of
this Section. If this Plan is the plan accepting such rollover or plan-to-plan
transfer, it shall consider such rollover or plan-to-plan transfer as part of
the Participant's Aggregate Account balance, irrespective of the date on which
such rollover or plan-to-plan transfer is accepted.
(7) For the purposes of determining whether two employers
are to be treated as the same employer in (5) and (6) above, all employers
aggregated under Code Section 414(b), (c), (m) and (o) are treated as the same
employer.
(d) "Aggregation Group" means either a Required Aggregation
Group or a Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group: In determining a Required
Aggregation Group hereunder, each plan of the Employer in which a Key Employee
is a participant in the Plan Year containing the Determination Date or any of
the four preceding Plan Years, and each other plan of the Employer which enables
any plan in which a Key Employee participates to meet the requirements of Code
Sections 401(a)(4) or 410, will be required to be aggregated. Such group shall
be known as a Required Aggregation Group.
In the case of a Required Aggregation Group, each plan in the group will
be considered a Top Heavy Plan if the Required Aggregation Group is a Top Heavy
Group. No plan in the Required Aggregation Group will be considered a Top Heavy
Plan if the Required Aggregation Group is not a Top Heavy Group.
(2) Permissive Aggregation Group: The Employer may also
include any other plan not required to be included in the Required Aggregation
Group, provided the resulting group, taken as a whole, would continue to satisfy
the provisions of Code Sections 401(a)(4) and 410.
Such group shall be known as a Permissive Aggregation Group.
In the case of a Permissive Aggregation Group, only a plan that is part
of the Required Aggregation Group will be considered a Top Heavy Plan if the
Permissive Aggregation Group is a Top Heavy Group. No plan in the Permissive
Aggregation Group will be considered a Top Heavy Plan if the Permissive
Aggregation Group is not a Top Heavy Group.
(3) Only those plans of the Employer in which the
Determination Dates fall within the same calendar year shall be aggregated in
order to determine whether such plans are Top Heavy Plans.
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(4) An Aggregation Group shall include any terminated plan
of the Employer if it was maintained within the last five (5) years ending on
the Determination Date.
(e) "Determination Date" means (a) the last day of the
preceding Plan Year, or (b) in the case of the first Plan Year, the last day of
such Plan Year.
(f) Present Value of Accrued Benefit: In the case of a defined
benefit plan, the Present Value of Accrued Benefit for a Participant other than
a Key Employee, shall be as determined using the single accrual method used for
all plans of the Employer and Affiliated Employers, or if no such single method
exists, using a method which results in benefits accruing not more rapidly than
the slowest accrual rate permitted under Code Section 411(b) (1) (c) . The
determination of the Present Value of Accrued Benefit shall be determined as of
the most recent Valuation Date that falls within or ends with the 12-month
period ending on the Determination Date except as provided in Code Section 416
and the Regulations thereunder for the first and second plan years of a defined
benefit plan.
(g) "Top Heavy Group" means an Aggregation Group in which, as
of the Determination Date, the sum of:
(1) the Present Value of Accrued Benefits of Key Employees
under all defined benefit plans included in the group, and
(2) the Aggregate Accounts of Key Employees under all
defined contribution plans included in the group, exceeds sixty percent (60%) of
a similar sum determined for all Participants.
ARTICLE X
MISCELLANEOUS
10.1 PARTICIPANT'S RIGHTS
This Plan shall not be deemed to constitute a contract between the
Employer and any Participant or to be a consideration or an inducement for the
employment of any Participant or Employee. Nothing contained in this Plan shall
be deemed to give any Participant or Employee the fight to be retained in the
service of the Employer or to interfere with the fight of the Employer to
discharge any Participant or Employee at any time regardless of the effect which
such discharge shall have upon him as a Participant of this Plan.
10.2 ALIENATION
(a) Subject to the exceptions provided below, no benefit which
shall be payable out of the Trust Fund to any person (including a Participant or
his Beneficiary) shall be subject in any manner to anticipation, alienation,
sale, transfer, assignment, pledge, encumbrance, or charge, and any attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber, or charge the
same shall be void; and no such benefit shall in any manner be liable
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for, or subject to, the debts, contracts, liabilities, engagements, or torts of
any such person, nor shall it be subject to attachment or legal process for or
against such person, and the same shall not be recognized by the Trustee, except
to such extent as may be required by law.
(b) This provision shall not apply to the extent a Participant
or Beneficiary is indebted to the Plan, as a result of a loan from the Plan. At
the time a distribution is to be made to or for a Participant's or Beneficiary's
benefit, such proportion of the amount distributed as shall equal such loan
indebtedness shah be paid by the Trustee to the Trustee or the Administrator, at
the direction of the Administrator, to apply against or discharge such loan
indebtedness. Prior to making a payment, however, the Participant or Beneficiary
must be given written notice by the Administrator that such loan indebtedness is
to be so paid in whole or part from his Participant's Combined Account. If the
Participant or Beneficiary does not agree that the loan indebtedness is a valid
claim against his Vested Participant's Combined Account, he shall be entitled to
a review of the validity of the claim in accordance with procedures provided in
Sections 2.7 and 2.8.
(c) This provision shall not apply to a "qualified domestic
relations order" defined in Code Section 414(p), and those other domestic
relations orders permitted to be so treated by the Administrator under the
provisions of the Retirement Equity Act of 1984. The Administrator shall
establish a written procedure to determine the qualified status of domestic
relations orders and to administer distributions under such qualified orders.
Further, to the extent provided under a "qualified domestic relations order," a
former spouse of a Participant shall be treated as the spouse or surviving
spouse for all purposes under the Plan.
(d) Notwithstanding any provision of this Section to the
contrary, an offset to a Participant's accrued benefit against an amount that
the Participant is ordered or required to pay the Plan with respect to a
judgment, order, or decree issued, or a settlement entered into, on or after
August 5, 1997, shall be permitted in accordance with Code Sections
401(a)(13)(c) and (D).
10.3 CONSTRUCTION OF PLAN
This Plan and Trust shall be construed and enforced according to the Act
and the laws of the State of Colorado (Vermont prior to January 1, 1998), other
than its laws respecting choice of law, to the extent not preempted by the Act.
10.4 GENDER AND NUMBER
Wherever any words are used herein in the masculine, feminine or neuter
gender, they shall be construed as though they were also used in another gender
in all cases where they would so apply, and whenever any words are used herein
in the singular or plural form, they shall be construed as though they were also
used in the other form in all cases where they would so apply.
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10.5 LEGAL ACTION
In the event any claim, suit, or proceeding is brought regarding the
Trust and/or Plan established hereunder to which the Trustee, the Employer or
the Administrator may be a party, and such claim, suit, or proceeding is
resolved in favor of the Trustee, the Employer or the Administrator, they shall
be entitled to be reimbursed from the Trust Fund for any and all costs,
attorney's fees, and other expenses pertaining thereto incurred by them for
which they shall have become liable.
10.6 PROHIBITION AGAINST DIVERSION OF FUNDS
(a) Except as provided below and otherwise specifically
permitted by law, it shall be impossible by operation of the Plan or of the
Trust, by termination of either, by power of revocation or amendment, by the
happening of any contingency, by collateral arrangement or by any other means,
for any part of the corpus or income of any trust fund maintained pursuant to
the Plan or any funds contributed thereto to be used for, or diverted to,
purposes other than the exclusive benefit of Participants, Retired Participants,
or their Beneficiaries.
(b) In the event the Employer shall make an excessive
contribution under a mistake of fact pursuant to Act Section 403(c)(2)(A), the
Employer may demand repayment of such excessive contribution at any time within
one (1) year following the time of payment and the Trustees shall return such
amount to the Employer within the one (1) year period. Earnings of the Plan
attributable to the excess contributions may not be returned to the Employer but
any losses attributable thereto must reduce the amount so returned.
10.7 BONDING
Every Fiduciary, except a bank or an insurance company, unless exempted
by the Act and regulations thereunder, shall be bonded in an amount not less
than 10% of the amount of the funds such Fiduciary handles; provided, however,
that the minimum bond shall be $1,000 and the maximum bond, $500,000. The amount
of funds handled shall be determined at the beginning of each Plan Year by the
amount of funds handled by such person, group, or class to be covered and their
predecessors, if any, during the preceding Plan Year, or if there is no
preceding Plan Year, then by the amount of the funds to be handled during the
then current year. The bond shall provide protection to the Plan against any
loss by reason of acts of fraud or dishonesty by the Fiduciary alone or in
connivance with others. The surety shall be a corporate surety company (as such
term is used in Act Section 412(a)(2)), and the bond shall be in a form approved
by the Secretary of Labor. Notwithstanding anything in the Plan to the contrary,
the cost of such bonds shall be an expense of and may, at the election of the
Administrator, be paid from the Trust Fund or by the Employer.
10.8 EMPLOYER'S AND TRUSTEE'S PROTECTIVE CLAUSE
Neither the Employer, the Administrator, nor the Trustee, nor their
successors shall be responsible for the validity of any Contract issued
hereunder or for the failure on the part of the
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insurer to make payments provided by any such Contract, or for the action of any
person which may delay payment or render a Contract null and void or
unenforceable in whole or in part.
10.9 INSURER'S PROTECTIVE CLAUSE
Any insurer who shall issue Contracts hereunder shall not have any
responsibility for the validity of this Plan or for the tax or legal aspects of
this Plan. The insurer shall be protected and held harmless in acting in
accordance with any written direction of the Trustee, and shall have no duty to
see to the application of any funds paid to the Trustee, nor be required to
question any actions directed by the Trustee. Regardless of any provision of
this Plan, the insurer shall not be required to take or permit any action or
allow any benefit or privilege contrary to the terms of any Contract which it
issues hereunder, or the roles of the insurer.
10.10 RECEIPT AND RELEASE FOR PAYMENTS
Any payment to any Participant, his legal representative, Beneficiary,
or to any guardian or committee appointed for such Participant 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 and the Employer,
either of whom may require such Participant, legal representative, Beneficiary,
guardian or committee, as a condition precedent to such payment, to execute a
receipt and release thereof in such form as shall be determined by the Trustee
or Employer.
10.11 ACTION BY THE EMPLOYER
Whenever the Employer under the terms of the Plan is permitted or
required to do or perform any act or matter or thing, it shall be done and
performed by a person duly authorized by its legally constituted authority.
10.12 NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
The "named Fiduciaries" of this Plan are (1) the Employer, (2) the
Administrator and (3) the Trustee. The named Fiduciaries shall have only those
specific powers, duties, responsibilities, and obligations as are specifically
given them under the Plan or as accepted by or assigned to them pursuant to any
procedure provided under the Plan, including but not limited to any agreement
allocating or delegating their responsibilities, the terms of which are
incorporated herein by reference. In general, unless otherwise indicated herein
or pursuant to such agreements, the Employer shall have the duties specified in
Article II hereof, as the same may be allocated or delegated thereunder,
including but not limited to the responsibility for making the contributions
provided for under Section 4.1; and shall have the authority to appoint and
remove the Trustee and the Administrator; to formulate the Plan's "funding
policy and method"; and to amend or terminate, in whole or in part, the Plan.
The Administrator shall have the responsibility for the administration of the
Plan, including but not limited to the items specified in Article II of the
Plan, as the same may be allocated or delegated thereunder. The Administrator
shall act as the named Fiduciary responsible for communicating with the
Participant according to the Participant Direction Procedures. The Trustee shall
have the responsibility of management and control of the assets held under the
Trust, except to the extent
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<PAGE> 77
directed pursuant to Article II or with respect to those assets, the management
of which has been assigned to an Investment Manager, who shall be solely
responsible for the management of the assets assigned to it, all as specifically
provided in the Plan and any agreement with the Trustee. Each named Fiduciary
warrants that any directions given, information furnished, or action taken by it
shall be in accordance with the provisions of the Plan, authorizing or providing
for such direction, information or action. Furthermore, each named Fiduciary may
rely upon any such direction, information or action of another named Fiduciary
as being proper under the Plan, and is not required under the Plan to inquire
into the propriety of any such direction, information or action. It is intended
under the Plan that each named Fiduciary shall be responsible for the proper
exercise of its own powers, duties, responsibilities and obligations under the
Plan as specified or allocated herein. No named Fiduciary shall guarantee the
Trust Fund in any manner against investment loss or depreciation in asset value.
Any person or group may serve in more than one Fiduciary capacity. In the
furtherance of their responsibilities hereunder, the "named Fiduciaries" shall
be empowered to interpret the Plan and Trust and to resolve ambiguities,
inconsistencies and omissions, which findings shall be binding, final and
conclusive.
10.13 HEADINGS
The headings and subheadings of this Plan have been inserted for
convenience of reference and are to be ignored in any construction of the
provisions hereof.
10.14 APPROVAL BY INTERNAL REVENUE SERVICE
(a) Notwithstanding anything herein to the contrary,
contributions to this Plan are conditioned upon the initial qualification of the
Plan under Code Section 401. If the Plan receives an adverse determination with
respect to its initial qualification, then the Plan may return such
contributions to the Employer within one year after such determination, provided
the application for the 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.
(b) Notwithstanding any provisions to the contrary, except
Sections 3.5, 3.6, and 4.l(e), any contribution by the Employer to the Trust
Fund is conditioned upon the deductibility of the contribution by the Employer
under the Code and, to the extent any such deduction is disallowed, the Employer
may, within one (1) year following the disallowance of the deduction, demand
repayment of such disallowed contribution and the Trustee shall return such
contribution within one (1) year following the disallowance. Earnings of the
Plan attributable to the excess contribution may not be returned to the
Employer, but any losses attributable thereto must reduce the amount so
returned.
10.15 UNIFORMITY
All provisions of this Plan shall be interpreted and applied in a
uniform, nondiscriminatory manner. In the event of any conflict between the
terms of this Plan and any Contract purchased hereunder, the Plan provisions
shall control.
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<PAGE> 78
ARTICLE XI
PARTICIPATING EMPLOYERS
11.1 ADOPTION BY OTHER EMPLOYERS
Notwithstanding anything herein to the contrary, with the consent of the
Employer and Trustee, any other corporation or entity, whether an affiliate or
subsidiary or not, may adopt this Plan and all of the provisions hereof, and
participate herein and be known as a Participating Employer, by a properly
executed document evidencing said intent and will of such Participating
Employer.
11.2 REQUIREMENTS OF PARTICIPATING EMPLOYERS
(a) Each such Participating Employer shall be required to use
the same Trustee as provided in this Plan.
(b) The Trustee may, but shall not be required to, commingle,
hold and invest as one Trust Fund all contributions made by Participating
Employers, as well as all increments thereof. However, the assets of the Plan
shall, on an ongoing basis, be available to pay benefits to all Participants and
Beneficiaries under the Plan without regard to the Employer or Participating
Employer who contributed such assets.
(c) The transfer of any Participant from or to an Employer
participating in this Plan, whether he be an Employee of the Employer or a
Participating Employer, shall not affect such Participant's rights under the
Plan, and all amounts credited to such Participant's Combined Account as well as
his accumulated service time with the transferor or predecessor, and his length
of participation in the Plan, shall continue to his credit.
(d) All rights and values forfeited by termination of
employment shall inure only to the benefit of the Participants of the Employer
or Participating Employer by which the forfeiting Participant was employed,
except if the Forfeiture is for an Employee whose Employer is an Affiliated
Employer, then said Forfeiture shall inure to the benefit of the Participants of
those Employers who are Affiliated Employers. Should an Employee of one
("First") Employer be transferred to an associated ("Second") Employer which is
an Affiliated Employer, such transfer shall not cause his account balance
(generated while an Employee of "First" Employer) in any manner, or by any
amount to be forfeited. Such Employee's Participant Combined Account balance for
all purposes of the Plan, including length of service, shall be considered as
though he had always been employed by the "Second" Employer and as such had
received contributions, forfeitures, earnings or losses, and appreciation or
depreciation in value of assets totaling the amount so transferred.
(e) Any expenses of the Trust which are to be paid by the
Employer or borne by the Trust Fund shall be paid by each Participating Employer
in the same proportion that the total amount standing to the credit of all
Participants employed by such Employer bears to the total standing to the credit
of all Participants.
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<PAGE> 79
11.3 DESIGNATION OF AGENT
Each Participating Employer shall be deemed to be a party to this Plan;
provided, however, that with respect to all of its relations with the Trustee
and Administrator for the purpose of this Plan, each Participating Employer
shall be deemed to have designated irrevocably the Employer as its agent. Unless
the context of the Plan clearly indicates the contrary, the word "Employer"
shall be deemed to include each Participating Employer as related to its
adoption of the Plan.
11.4 EMPLOYEE TRANSFERS
It is anticipated that an Employee may be transferred between
Participating Employers, and in the event of any such transfer, the Employee
involved shall carry with him his accumulated service and eligibility. No such
transfer shall effect a termination of employment hereunder, and the
Participating Employer to which the Employee is transferred shall thereupon
become obligated hereunder with respect to such Employee in the same manner as
was the Participating Employer from whom the Employee was transferred.
11.5 PARTICIPATING EMPLOYER CONTRIBUTION
Any contribution subject to allocation during each Plan Year shall be
allocated only among those Participants of the Employer or Participating
Employer making the contribution, except if the contribution is made by an
Affiliated Employer, in which event such contribution shall be allocated among
all Participants of all Participating Employers who are Affiliated Employers in
accordance with the provisions of this Plan. On the basis of the information
furnished by the Administrator, the Trustee shall keep separate books and
records concerning the affairs of each Participating Employer hereunder and as
to the accounts and credits of the Employees of each Participating Employer. The
Trustee may, but need not, register Contracts so as to evidence that a
particular Participating Employer is the interested Employer hereunder, but in
the event of an Employee transfer from one Participating Employer to another,
the employing Employer shall immediately notify the Trustee thereof.
11.6 AMENDMENT
Amendment of this Plan by the Employer at any time when there shall be a
Participating Employer hereunder shall only be by the written action of each and
every Participating Employer and with the consent of the Trustee where such
consent is necessary in accordance with the terms of this Plan.
11.7 DISCONTINUANCE OF PARTICIPATION
Any Participating Employer shall be permitted to discontinue or revoke
its participation in the Plan. At the time of any such discontinuance or
revocation, satisfactory evidence thereof and of any applicable conditions
imposed shall be delivered to the Trustee. The Trustee shall thereafter
transfer, deliver and assign Contracts and other Trust Fund assets allocable to
the Participants of such Participating Employer to such new Trustee as shall
have been designated by
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<PAGE> 80
such Participating Employer, in the event that it has established a separate
pension plan for its Employees, provided however, that no such transfer shall be
made if the result is the elimination or reduction of rely "Section 411(d)(6)
protected benefits" in accordance with Section 8.1 (c). If no successor is
designated, the Trustee shall retain such assets for the Employees of said
Participating Employer pursuant to the provisions of Article VII hereof. In no
such event shall any part of the corpus or income of the Trust as it relates to
such Participating Employer be used for or diverted to purposes other than for
the exclusive benefit of the Employees of such Participating Employer.
11.8 ADMINISTRATOR'S AUTHORITY
The Administrator shall have authority to make any and all necessary
roles or regulations, binding upon all Participating Employers and all
Participants, to effectuate the purpose of this Article.
IN WITNESS WHEREOF, this Plan has been executed the day and year first
above written.
The Stratton Corporation
By /s/
--------------------------------------
Employer
/s/ Carl S. Williams
---------------------------------------
Trustee
/s/ Robert Fries
---------------------------------------
Trustee
/s/ Michael P. Moran
---------------------------------------
Trustee
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<PAGE> 81
INTRAWEST 401(k) RETIREMENT PLAN
FUNDING POLICY AND METHOD
A pension benefit plan (as defined in the Employee Retirement Income
Security Act of 1974) has been adopted by the company for the purpose of
rewarding long and loyal service to the company by providing to employees
additional financial security at retirement. Incidental benefits are provided in
the case of disability, death or other termination of employment.
Since the principal purpose of the plan is to provide benefits at normal
retirement age, the principal goal of the investment of the funds in the plan
should be both security and long-term stability with moderate growth
commensurate with the anticipated retirement dates of participants. Investments,
other than "fixed dollar" investments, should be included among the plan's
investments to prevent erosion by inflation. However, investments should be
sufficiently liquid to enable the plan, on short notice, to make some
distributions in the event of the death or disability of a participant.
<PAGE> 82
ADDENDUM
TO
INTRAWEST 401(K) RETIREMENT PLAN
Years of Service Recognized
Pursuant to Section 1.69, Years of Service with the following entities shall be
recognized for purposes of eligibility to participate and vesting:
Copper Mountain, Inc.
Ski Venture, Inc.
Village of River Run at Keystone Mountain
Apex Travel, Inc.
Snowshoe-Silver Creek Mountain Resort and its wholly-owned subsidiaries
The Stratton Corporation
Intrawest U.S.A., Inc.
TDC Management, Inc.
TDC(SC), Inc.
Stratton Restaurant & Lodging
Intrawest Corporation and its Canadian and U.S. affiliates as of
10/31/97, except Wilderness Property Management, L.L.C.
Great Gorge Resort, Inc.
Angel Projects, L.L.C.
Great American Recreation Association
Keystone/Intrawest L.L.C.
Breeze, Inc.
Max Snowboard, Inc.
Lippon, L.L.C.
Murph's Libations, L.L.C.
<PAGE> 83
DELEGATION OF ADMINISTRATIVE AUTHORITY
BY PLAN ADMINISTRATOR
OF
INTRAWEST 401(K) RETIREMENT PLAN
Pursuant to Section 2.2 of the Intrawest 401(k) Retirement Plan
("Plan"), the Plan Administrator may appoint a person or committee to perform
certain duties of the Plan Administrator. The Plan Administrator hereby
authorizes the performance of file following specific duties by appointed
individuals (to be known as Local Benefit Committees and named on the attached
sheet) at each office of the Employer and Participating Employers, as they
pertain to the employees of the Employer or Participating Employer, and
delegates the following specific duties to those individuals:
(a) the discretion to determine all questions relating to the
eligibility of Employees to participate or remain a Participant and receive
benefits under the Plan;
(b) to compute, certify, and direct the Trustee with respect to the
amount and the kind of benefits to which any Participant shall be entitled under
the Plan;
(c) to maintain necessary records (date of hire, date of birth, date of
termination, hours worked, and compensation and other payroll data) for the
administration of the Plan which pertain to the Participating Employer;
(d) to prepare and distribute to Employees a procedure for notifying
Participants and Beneficiaries of their rights to elect qualified joint and
survivor annuities and Pre-Retirement Survivor Annuities; to distribute to
employees and terminated employees all required distribution notifications and
election forms;
(e) to prepare and implement a procedure to notify Eligible employees
that they may elect to have a portion of their compensation deferred or paid to
them in cash;
(f) to be responsible for communications with Participants as needed to
maintain Plan compliance with ERISA Section 404(c), including, but not limited
to, the receipt and transmitting of Participant's directions as to the
investment of their account(s) under the Plan and the formulation of policies,
roles, and procedures pursuant to which Participants may give investment
instructions with respect to the investment of their accounts; and
(g) to assist any Participant by responding to inquiries regarding his
rights, benefits, or the elections available under the Plan.
PLAN ADMINISTRATOR: Intrawest U.S. Holdings Inc.
By /s/ Date: 31 October 1997
------------------------
<PAGE> 84
AMENDMENT NO. 1
TO THE
INTRAWEST 401(K) RETIREMENT PLAN
WHEREAS, effective as of January 1, 1998, Intrawest U.S. Holdings Inc.
(herein "Employer") be, came the successor sponsor of the amended and restated
Intrawest 40l(k) Retirement Plan ("Plan") which was originally effective June
30, 1978 (originally called the "Stratton Corporation Employees' 401(k) Savings
and Sales Incentive Plan"), and
WHEREAS, the Employer wishes to amend certain provisions of the Plan,
and
WHEREAS, Article VIII, Section 8.1 of the Plan authorizes the Employer
to amend the Plan document;
NOW, THEREFOR, the Employer hereby amends the Plan document, effective
January l, 1998, in the following respects:
(1) Section 1.9 "Compensation" shall be amended by replacing the
first two paragraphs with the following:
1.9 "Compensation" with respect to any Participant
means such Participant's wages as defined in Code
Section 3401(a) and all other payments of
compensation by the Employer (in the course of
the Employer's trade or business) for a Plan Year
for which the Employer is required to furnish the
Participant a written statement under Code
Sections 6041(d), 605i(a)(3) and 6052.
Compensation must be determined without regard to
any rules under Code Section 3401(a) that limit
the remuneration included in wages based on the
nature or location of the employment or the
services performed (such as the exception for
agricultural labor in Code Section 3401 (a)(2).
(2) Section 1.26 "415 Compensation" shall be amended by replacing
the first two paragraphs with the following:
1.26 "415 Compensation" with respect to any
Participant means such Participant's wages as
defined in Code Section 3401(a) and all other
payments of compensation by the Employer (in the
course of the Employer's wade or business) for a
Plan Year for which the Employer is required to
furnish the Participant a written statement under
Code Sections 6041 (d), 6051(a)(3) and 6052. "415
Compensation" must be determined without regard to
any rules under Code Section 3401(a) that limit
the remuneration included in wages based on the
nature or location of the employment or the
services performed (such as the exception for
agricultural labor in Code Section 3401(a)(2)).
-1-
<PAGE> 85
(3) Section 6.4(e) ("Determination of Benefits Upon Termination") shall
be amended by insertion of the. following at the end of said section:
Any Employee who was a Participant in this Plan prior to January 1, 1998 s1~1
have the following Vesting Schedule apply to their Employer Matching
Contribution Account effective January 1, 1995:
Fifty percent (50%) of the Employer Matching Contribution Account shall be 100%
vested immediately. The remaining 50% of the Employer Matching Contribution
Account shall be subject to the following schedule:
Vesting Schedule
Matching Contributions
<TABLE>
<CAPTION>
Years of Service Percentage
-------------------- --------------
<S> <C>
1 20%
2 40%
3 60%
4 80%
5 100%
</TABLE>
IN ALL OTHER RESPECTS, the Plan shall remain in full force and effect.
IN WITNESS WHEREOF, the Employer has caused this amendment to be
executed this 15th day of December, 1998.
Employer: Intrawest U.S. Holdings Inc.
By /s/ David A. Hill, Vice President
----------------------------------------------
Participating Employer: The Stratton Corporation
By /s/ John E. Currie, Vice President
----------------------------------------------
Participating Employer: Copper Mountain, Inc.
By /s/ David E. Hill, Vice President
----------------------------------------------
Participating Employer: Snowshoe Resort, Inc.
By /s/ John E. Currie, Vice President
----------------------------------------------
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<PAGE> 86
Participating Employer: Intrawest Squaw
Corporation
By /s/ John E. Currie, Vice President
----------------------------------------------
Participating Employer: Intrawest Mammoth
Corporation
By /s/ John E. Currie, Vice President
----------------------------------------------
Participating Employer: Great Gorge Resort, Inc.
By /s/ John E. Currie, Vice President
----------------------------------------------
-3-
<PAGE> 1
EXHIBIT 5.1
[Letterhead of McCarthy Tetrault]
August 5, 1999
Securities and Exchange Commission
450 Fifth Street NW
Washington, DC 20549
Dear Sirs/Mesdames:
Re: Registration Statement on Form S-8 of Intrawest Corporation;
Intrawest 401(k) Retirement Plan
We have acted as Canadian counsel to Intrawest Corporation (the
"Company") in connection with the filing of the above-referenced Registration
Statement (the "Registration Statement") relating to the registration of 30,000
common shares without par value of the Company (the "Shares") issuable upon the
exercise of options granted or to be granted under the Company's 401(k)
Retirement Plan (the "Plan"). In connection therewith, we have considered such
questions of law and have examined and relied upon such resolutions, records,
certificates of public officials and officers of the Company and other documents
we deemed necessary or appropriate to enable us to render the opinion expressed
below.
Based on the foregoing, it is our opinion that any shares issued in
accordance with the Plan and upon receipt by the Company of the consideration
therefor shall be validly issued and outstanding as fully paid and
non-assessable shares.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to all references to our firm included in or made a
part of the Registration Statement.
Yours Truly,
/s/ McCARTHY TETRAULT
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT CHARTERED ACCOUNTANTS
The Board of Directors
Intrawest Corporation
We consent to the incorporation by reference in the Registration
Statement on Form S-8 of Intrawest Corporation pertaining to the Intrawest
401(k) Retirement Plan of our report dated September 10, 1998, which report
appears in the June 30, 1998 annual report on Form 40-F of Intrawest
Corporation.
/s/ KPMG LLP
Chartered Accountants
Vancouver, Canada
September 22, 1999
