<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 21, 2000
REGISTRATION NO. 333-
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20552
-------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
-------------------
ENCOMPASS SERVICES CORPORATION
(Exact name of registrant as specified in its charter)
TEXAS 76-0535259
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3 GREENWAY PLAZA, SUITE 2000 77046
HOUSTON, TEXAS (Zip Code)
(Address of Principal Executive Offices)
ENCOMPASS SERVICES CORPORATION
EMPLOYEE SAVINGS 401(K) Plan
(Full title of plan)
GRAY H. MUZZY
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
3 GREENWAY PLAZA, SUITE 2000
HOUSTON, TEXAS 77046
(Name and address of agent for service)
(713) 860-0100
(Telephone number, including area code, of agent for service)
-------------------
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
=======================================================================================
Proposed
Title of Securities Amount to be Maximum Aggregate Amount of
to be Registered Registered Offering Price Registration Fee
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
Common Stock,
$.001 par value (1)..... 450,000 shares (2) $2,362,500 (3) $ 624 (3)
- ---------------------------------------------------------------------------------------
Plan Interests (4) (4) (4)
=======================================================================================
</TABLE>
(1) This Registration Statement covers the solicitation of offers to buy shares
of Common Stock, $.001 par value (the "Common Stock"), of Encompass
Services Corporation which may be directed to participants in the Encompass
Services Corporation Employee Savings 401(k) Plan (the "Plan").
(2) Pursuant to Rule 416(a), this Registration Statement also registers such
indeterminate number of additional shares of Common Stock issuable in
connection with stock splits, share dividends or similar transactions.
(3) Estimated pursuant to Rule 457(h) solely for the purpose of calculating the
registration fee based on the average of the high and low prices for the
Common Stock on the New York Stock Exchange on April 17, 2000 ($ 5.25 per
share).
(4) Pursuant to Rule 416(c), this Registration Statement covers an
indeterminate amount of interests to be acquired pursuant to the Plan.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Note: The documents containing the information specified in this Part I will be
sent or given to employees as specified by Rule 428(b)(1) ((S) 230.428(b)(1)).
Such documents need not be filed with the Commission either as part of this
registration statement or as prospectuses or prospectus supplements pursuant to
Rule 424 ((S) 230.424). These documents and the documents incorporated by
reference in the registration statement pursuant to Item 3 of Part II of this
Form, taken together, constitute a prospectus that meets the requirements of
Section 10(a) of the Securities Act. See Rule 428(a)(1) ((S) 230.428(a)(1)).
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
1. The following documents, or portions of documents, previously filed by
Encompass Services Corporation (the "Company") with the Securities and Exchange
Commission (the "Commission") are hereby incorporated herein by reference:
(a) (i) Annual Report on Form 10-K for the year ended December 31, 1999;
and
(ii) Current Reports on Form 8-K dated January 20, 2000; February 2,
2000; and February 25, 2000 and on Form 8-K/A dated April 17,
2000.
(b) The description of the Company's Common Stock, $.001 par value,
contained in the Registration Statement on Form 8-A dated November 4, 1997.
2. All reports subsequently filed by the Company or the Company's
Employee Savings 401(k) Plan pursuant to Sections 13(a), 13(c), 14 and 15(d) of
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part hereof from the date of filing such documents.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not Applicable
2
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Article 2.02-1.B of the Texas Business Corporation Act, as amended (the
"TBCA"), grants to a corporation the power to indemnify a person who was, is or
is threatened to be made a named defendant or respondent in a proceeding because
the person is or was a director against judgments, penalties (including excise
and similar taxes), fines, settlements and reasonable expenses actually incurred
in connection therewith, only if it is determined that the person (1) conducted
himself in good faith; (2) reasonably believed that (a) in the case of conduct
in his official capacity as a director of the corporation, his conduct was in
the corporation's best interests, and (b) in all other cases, his conduct was at
least not opposed to the corporation's best interest; and (3) in the case of any
criminal proceeding, he had no reasonable cause to believe that his conduct was
unlawful. Article 2.02-1.C limits the allowable indemnification by providing
that, except to the extent permitted by Article 2.02-1.E, a director may not be
indemnified in respect of a proceeding in which the person was found liable
(1) on the basis that he improperly received a personal benefit, whether or not
the benefit resulted from an action taken in his official capacity, or (2) to
the corporation. Article 2.02-1.E provides that if a director is found liable to
the corporation or is found liable on the basis that he improperly received a
personal benefit, the permissible indemnification (1) is limited to reasonable
expenses actually incurred by the person in connection with the proceeding, and
(2) shall not be made in respect of any proceeding in which the person shall
have been found liable for willful or intentional misconduct in the performance
of his duty to the corporation. Finally, Article 2.02-1.H provides that a
corporation shall indemnify a director against reasonable expenses incurred by
him in connection with a proceeding in which he is a named defendant or
respondent because he is or was a director if he has been wholly successful, on
the merits or otherwise, in the defense of the proceeding.
With respect to the officers of a corporation, Article 2.02-1.O of the TBCA
provides that a corporation may indemnify and advance expenses to an officer of
the corporation to the same extent that it may indemnify and advance expenses to
directors under Article 2.02-1. Further, Article 2.01-1.O provides that an
officer of a corporation shall be indemnified as, and to the same extent,
provided by Article 2.02-1.H for a director.
The Amended and Restated Certificate of Incorporation of the Company
(the "Certificate") provides that each person who was or is made a party or is
threatened to be made a party to or is otherwise involved in any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative, arbitrative or investigative, any appeal in such action, suit or
proceeding, and any inquiry or investigation that would lead to such action,
suit or proceeding (hereinafter a "proceeding"), by reason of the fact that he
or she, or a person of whom he or she is the legal representative, is or was a
director or officer of the Company or is or was serving at the request of the
Company as a director or officer of another corporation or of a partnership,
joint venture, trust or other enterprise, including service with respect to any
employee benefit plan (hereinafter an "indemnitee"), whether the basis of such
proceeding is alleged action in an official capacity as a director or officer or
in any other capacity while serving as a director or officer, shall be
indemnified and held harmless by the Company to the fullest extent authorized by
the TBCA, as the same exists or may hereafter be amended (but, in the case of
any such amendment, only to the extent that such
3
<PAGE>
amendment permits the Company to provide broader indemnification rights than
permitted prior thereto), against all judgments, fines, penalties (including
excise tax and similar taxes), settlements, and reasonable expenses actually
incurred by such indemnitee in connection therewith. The right to
indemnification conferred in this Article shall include the right to be paid by
the Company the expenses incurred in defending any such proceeding in advance of
its final disposition (hereinafter an "advancement of expenses"); provided,
however, that if the TBCA requires, an advancement of expenses incurred by an
indemnitee shall be made only upon delivery to the Company of any undertaking,
by or on behalf of such indemnitee, to repay all amount so advanced if it shall
ultimately be determined by that such indemnitee is not entitled to be
indemnified for such expenses under this Article or otherwise.
The Certificate also provides, to the greatest extent permitted by
applicable law in effect from time to time, a director of the Company shall not
be liable to the Company or its shareholders for monetary damages for an act or
omission in the director's capacity as a director except for liability for:
(i) a breach of a director's duty of loyalty to the Company or its shareholders;
(ii) an act or omission not in good faith that constitutes a breach of duty of
the director to the Company or that involved intentional misconduct or a knowing
violation of the law; (iii) a transaction from which a director received an
improper benefit, whether or not the benefit resulted from an action taken
within the scope of the director's office; (iv) an act or omission for which the
liability of a director is expressly provided for by statute; or (v) an act
related to any unlawful stock repurchase or unlawful payment of a dividend.
The Certificate provides that the Company may purchase and maintain
insurance, at its expense, on behalf of any indemnitee against any liability
asserted against him and incurred by him in such a capacity or arising out of
his status as a representative of the Company, whether or not the Company would
have the power to indemnify such person against such expense, liability or loss
under the TBCA.
The Company has entered into employment agreements with its executive
officers pursuant to which the Company is generally obligated to indemnify such
officers to the full extent permitted by the TBCA as described above.
The Company has purchased liability insurance policies covering the
directors and officers of the Company, including to provide protection where the
Company cannot legally indemnify a director or officer and where a claim arises
under the Employee Retirement Income Security Act of 1974 against a director or
officer based on an alleged breach of fiduciary duty or other wrongful act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not Applicable
ITEM 8. EXHIBITS.
4.1 Encompass Services Corporation Employee Savings 401(k) Plan.
4
<PAGE>
23.1 Consent of KPMG LLP.
23.2 Consent of PricewaterhouseCoopers LLP.
23.3 Consent of Frazier & Deeter, LLC.
23.4 Consent of Schenck & Associates SC.
23.5 Consent of Randolph W. Bryant (included in his opinion filed as
Exhibit 5.1).
24.1 Powers of Attorney.
Pursuant to paragraph (b) of Item 8 of Form S-8, in lieu of filing an
Exhibit 5 to this Registration Statement, the Company hereby undertakes that it
will submit the plan to which this Registration Statement relates and any
amendment thereto to the Internal Revenue Service ("IRS") in a timely manner and
will make all changes required by the IRS in order to qualify the plan under
Section 401 of the Internal Revenue Code.
ITEM 9. UNDERTAKINGS.
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a post-
effective amendment to the registration statement;
(i) To include any prospectus required by Section 10(a)(3) of the Act;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the registration statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement;
Provided, however, that paragraphs (i) and (ii) do not apply if the
registration statement is on Form S-8 and the information required to be
included in a post-effective amendment by those paragraphs is contained in
periodic reports filed by the registrant pursuant to Section 13 or Section 15(d)
of the Exchange Act that are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under the Act,
each such post-effective amendment shall be deemed to be a new registration
statement relating to the
5
<PAGE>
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Act, each filing of the registrant's annual
report pursuant to Section 13(a) or Section 15(d) of the Exchange Act (and,
where applicable, each filing of an employee benefit plan's annual report
pursuant to Section 15(d) of the Exchange Act) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Act 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.
6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement or amendment thereto to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Houston, State of Texas, on April 17,
2000.
ENCOMPASS SERVICES CORPORATION
By: /s/ J. Patrick Millinor, Jr.
-------------------------------
J. Patrick Millinor, Jr.
Chairman of the Board
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement or amendment thereto has been signed by the following
persons in the indicated capacities on April 17, 2000.
<TABLE>
<CAPTION>
Signature Title
---------- -----
<S> <C>
/s/J. Patrick Millinor, Jr. Director and Chairman of the Board
- ----------------------------------
J. Patrick Millinor, Jr.
/s/Joseph M. Ivey Director, President and Chief Executive Officer
- ---------------------------------- (principal executive officer)
Joseph M. Ivey
/s/Darren B. Miller Senior Vice President and Chief Financial Officer
- ---------------------------------- (principal financial officer)
Darren B. Miller
/s/Daniel W. Kipp Vice President, Treasurer and Chief Information
- ---------------------------------- Officer
Daniel W. Kipp (principal accounting officer)
/s/Andrew Africk* Director
- ----------------------------------
Andrew Africk
/s/Vincent W. Eades* Director
- ----------------------------------
Vincent W. Eades
</TABLE>
7
<PAGE>
/s/Michael Gross* Director
- ----------------------------------
Michael Gross
/s/William P. Love, Jr.* Director
- ----------------------------------
William P. Love, Jr.
/s/Donald L. Luke* Director, Executive Vice President and Chief
- ---------------------------------- Operating Officer
Donald L. Luke
/s/Lucian L. Morrison* Director
- ----------------------------------
Lucian L. Morrison
/s/Brooks Newmark* Director
- ----------------------------------
Brooks Newmark
/s/M. Jude Reyes* Director
- ----------------------------------
M. Jude Reyes
/s/John M. Sullivan* Director
- ----------------------------------
John M. Sullivan
*By: Darren B. Miller
-----------------------------
Darren B. Miller
(Attorney-in-Fact for persons indicated)
8
<PAGE>
Pursuant to the requirements of the Securities Act of 1933, the Encompass
Services Corporation Employee Savings 401(k) Plan has duly caused this
Registration Statement or amendment thereto to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Houston, and the State of
Texas, on April 17, 2000.
ENCOMPASS SERVICES CORPORATION
EMPLOYEE SAVINGS 401(K) PLAN
By: /s/J. Patrick Millinor, Jr.
------------------------------
J. Patrick Millinor, Jr.
9
<PAGE>
Exhibit 4.1
BUILDING ONE EMPLOYEE SAVINGS 401(k) PLAN
Effective as of April 1, 2000
<PAGE>
TABLE OF CONTENTS
PREAMBLE
<TABLE>
<CAPTION>
ARTICLE I
DEFINITIONS
<S> <C>
1.1 Plan Definitions 1
1.2 Interpretation 7
ARTICLE II
SERVICE
2.1 Special Definitions 8
2.2 Crediting of Hours of Service 9
2.3 Hours of Service Equivalencies 10
2.4 Limitations on Crediting of Hours of Service 11
2.5 Department of Labor Rules 11
2.6 Crediting of "Continuous Service" 11
2.7 Eligibility Service 12
2.8 Years of Vesting Service; Vesting Service After Reemployment 12
2.9 Crediting of Service on Transfer or Amendment 12
ARTICLE III
ELIGIBILITY
3.1 Eligibility 14
3.2 Transfers of Employment 14
3.3 Re-employment 14
3.4 Notification Concerning New Eligible Employees 14
3.5 Effect and Duration 15
ARTICLE IV
TAX-DEFERRED CONTRIBUTIONS
4.1 Tax-Deferred Contributions 16
4.2 Amount of Tax-Deferred Contributions 16
4.3 Amendments to Reduction Authorization 16
4.4 Suspension of Tax-Deferred Contributions 16
4.5 Resumption of Tax-Deferred Contributions 17
4.6 Delivery of Tax-Deferred Contributions 17
4.7 Vesting of Tax-Deferred Contributions 17
</TABLE>
(i)
<PAGE>
<TABLE>
<CAPTION>
ARTICLE V
AFTER-TAX AND ROLLOVER CONTRIBUTIONS
<S> <C>
5.1 Transferred After-Tax Contributions 18
5.2 Rollover Contributions 18
5.3 Vesting of After-Tax Contributions and Rollover Contributions 18
ARTICLE VI
EMPLOYER CONTRIBUTIONS
6.1 Contribution Period 41
6.2 Qualified Nonelective Contributions 41
6.3 Allocation of Qualified Nonelective Contributions 19
6.4 Amount and Allocation of Wage Rate Contributions 19
6.5 Amount and Allocation of Regular Matching Contributions 20
6.6 Additional Discretionary Matching Contributions 20
6.7 Limit on Tax-Deferred Contributions Matched 20
6.8 Qualified Matching Contributions 21
6.9 Discretionary Profit Sharing Contributions 21
6.10 Verification of Amount of Employer Contributions by the Sponsor 21
6.11 Payment of Employer Contributions 21
6.12 Allocation Requirements for Employer Contributions 21
6.13 Exceptions to Allocation Requirements for Employer Contributions 22
6.14 Vesting of Employer Contributions 22
6.15 Election of Former Vesting Schedule 23
6.16 Forfeitures to Reduce Employer Contributions 23
ARTICLE VII
LIMITATIONS ON CONTRIBUTIONS
7.1 Definitions 24
7.2 Code Section 402(g) Limit 27
7.3 Distribution of "Excess Deferrals" 28
7.4 Limitation on Tax-Deferred Contributions of Highly Compensated
Employees 28
7.5 Determination and Allocation of Excess Tax-Deferred Contributions
Among Highly Compensated Employees 30
7.6 Distribution of Excess Tax-Deferred Contributions 31
7.7 Limitation on Matching Contributions of Highly Compensated Employees 31
7.8 Determination and Allocation of Excess Matching Contributions Among
Highly Compensated Employees 33
7.9 Forfeiture or Distribution of "Excess Deferrals" 34
7.10 Multiple Use Limitation 34
7.11 Treatment of Forfeited Matching Contributions 35
</TABLE>
(ii)
<PAGE>
<TABLE>
<S> <C>
7.12 Determination of Income or Loss 35
7.13 Code Section 415 Limitations on Crediting of Contributions and
Forfeitures 35
7.14 Application of Code Section 415 Limitations Where Participant is
Covered Under Other Qualified Defined Contribution Plan 36
7.15 Scope of Limitations 36
ARTICLE VIII
TRUST FUNDS AND ACCOUNTS
8.1 General Fund 38
8.2 Investment Funds 38
8.3 Loan Investment Fund 38
8.4 Income on Trust 38
8.5 Participant Accounts 38
8.6 Sub-Accounts 39
ARTICLE IX
LIFE INSURANCE CONTRACTS
9.1 No Life Insurance Contracts 40
ARTICLE X
DEPOSIT AND INVESTMENT OF CONTRIBUTIONS
10.1 Future Contribution Investment Elections 41
10.2 Deposit of Contributions 41
10.3 Election to Transfer Between Funds 41
10.4 404(c) Protection 41
ARTICLE XI
CREDITING AND VALUING ACCOUNTS
11.1 Crediting Accounts 42
11.2 Valuing Accounts 42
11.3 Plan Valuation Procedures 42
11.4 Finality of Determinations 43
11.5 Notification 43
ARTICLE XII
LOANS
12.1 Application for Loan 44
12.2 Reduction of Account Upon Distribution 44
12.3 Requirements to Prevent a Taxable Distribution 45
</TABLE>
(iii)
<PAGE>
<TABLE>
<S> <C>
12.4 Administration of Loan Investment Fund 46
12.5 Default 46
12.6 Deemed Distribution Under Code Section 72(p) 46
12.7 Special Rules Applicable to Loans 47
12.8 Loans Granted Prior to Merger 47
ARTICLE XIII
WITHDRAWALS WHILE EMPLOYED
13.1 Non-Hardship, In-Service Withdrawals of Prior After-Tax and Prior
Profit-Sharing Contributions 49
13.2 Non-Hardship, In-Service Withdrawals of Rollover Contributions
Attributable to Merged Plans 49
13.3 Age 59 1/2Withdrawals of Tax-Deferred Contributions Attributable to
Merged Plans 49
13.4 Overall Limitations on Non-Hardship Withdrawals 49
13.5 Hardship Withdrawals 50
13.6 Hardship Determination 50
13.7 Satisfaction of Necessity Requirement for Hardship Withdrawals 50
13.8 Conditions and Limitations on Hardship Withdrawals 51
13.9 Order of Withdrawal from a Participant's Sub-Accounts 51
ARTICLE XIV
TERMINATION OF EMPLOYMENT
AND SETTLEMENT DATE
14.1 Termination of Employment and Settlement Date 53
14.2 Disposition of Non-Vested Amounts 53
14.3 Treatment of Forfeited Amounts 53
14.4 Recrediting of Forfeited Amounts 54
ARTICLE XV
DISTRIBUTIONS
15.1 Distributions to Participants 55
15.2 Distributions to Beneficiaries 55
15.3 Cash Outs and Participant Consent 55
15.4 Required Commencement of Distribution 56
15.5 Re-Employment of a Participant 56
15.6 Restrictions on Alienation 57
15.7 Facility of Payment 57
15.8 Inability to Locate Payee 57
15.9 Distribution Pursuant to Qualified Domestic Relations Orders 57
</TABLE>
(iv)
<PAGE>
<TABLE>
<CAPTION>
ARTICLE XVI
FORM OF PAYMENT
<S> <C>
16.1 Applicability 59
16.2 Normal Form of Payment 59
16.3 Optional Forms of Payment 59
16.4 Change of Election 59
16.5 Direct Rollover 59
16.6 Notice Regarding Forms of Payment 60
16.7 Re-Employment 60
16.8 Distribution in the Form of Employer Stock 61
ARTICLE XVII
BENEFICIARIES
17.1 Designation of Beneficiary 62
17.2 Spousal Consent Requirements 62
ARTICLE XVIII
ADMINISTRATION
18.1 Appointment of Committee 63
18.2 Committee Powers and Duties 63
18.3 Claim Procedure 65
18.4 Committee Procedures 66
18.5 Authorization of Benefit Payments 66
18.6 Authority of the Sponsor 66
18.7 Qualified Domestic Relations Orders 67
18.8 Indemnity 67
ARTICLE XIX
AMENDMENT AND TERMINATION
19.1 Amendment 68
19.2 Limitation on Amendment 68
19.3 Termination 68
19.4 Reorganization 69
19.5 Withdrawal of an Employer 70
ARTICLE XX
ADOPTION BY OTHER ENTITIES
20.1 Adoption by Related Companies 71
20.2 Effective Plan Provisions 71
</TABLE>
(v)
<PAGE>
<TABLE>
<CAPTION>
ARTICLE XXI
MISCELLANEOUS PROVISIONS
<S> <C>
21.1 No Commitment as to Employment 72
21.2 Benefits 72
21.3 No Guarantees 72
21.4 Expenses 72
21.5 Precedent 72
21.6 Duty to Furnish Information 72
21.7 Withholding 72
21.8 Merger, Consolidation, or Transfer of Plan Assets 73
21.9 Back Pay Awards 73
21.10 Condition on Employer Contributions 73
21.11 Return of Contributions to an Employer 74
21.12 Validity of Plan 74
21.13 Trust Agreement 74
21.14 Parties Bound 74
21.15 Application of Certain Plan Provisions 74
21.16 Merged Plans 75
21.17 Transferred Funds 75
21.18 Veterans Re-Employment Rights 75
ARTICLE XXII
TOP-HEAVY PROVISIONS
22.1 Definitions 76
22.2 Applicability 78
22.3 Minimum Employer Contribution 78
22.4 Accelerated Vesting 78
ARTICLE XXIII
EFFECTIVE DATE
23.1 Effective Date 80
</TABLE>
ADDENDUM A
ADDENDUM B
(vi)
<PAGE>
PREAMBLE
The Plan established hereunder, to be known as the Building One Employee Savings
401(k) Plan, is intended to qualify as a profit-sharing plan under Code Section
401(a), and includes a cash or deferred arrangement that is intended to qualify
under Code Section 401(k). The Plan is established and maintained for the
exclusive benefit of Eligible Employees and their Beneficiaries.
Effective as of April 1, 2000 or as soon thereafter as is administratively
practicable in the discretion of the Plan Sponsor (the "Merger Date"), the
following plans (the "Merged Plans") are merged into and made a part of the
Plan:
Advent Electric Co., Inc. 401(k) Profit Sharing Plan
American Air Company, Inc. 401(k) Profit Sharing Plan
Building One Services Corporation 401(k) Profit-Sharing Plan
Chambers Electronic Communications, LLC 401(k) Profit Sharing Plan and Trust
Crest International, Inc. 401(k) Savings and Retirement Plan
Gamewell Mechanical 401(k) Plan
Garfield - Indecon Electrical Services, Inc. 401(k) Retirement Savings Plan
Gulf States Group, Inc. Savings and Investment Plan
Ivey's, Inc. Salary Reduction Plan
The Lewis Companies, Inc. 401(k) Plan
McIntosh Mechanical 401(k) Plan
National Network Services, Inc. 401(k) Plan
Omni Mechanical Services 401(k) Plan
Regency Electric Company 401(k) Profit Sharing Plan and Trust
Riviera Electric Construction Company 401(k) Savings & Retirement Plan
Riviera Electric of California, Inc. 401(k) Savings & Retirement Plan
Robinson Mechanical Company's 401(k) Plan
Sanders Brothers, Inc. Employees Savings Plan
SKC Electric, Inc. Profit Sharing and 401(k) Retirement Plan
Spann Building Maintenance Co. 401(k) Plan
Taylor Electric Inc. Retirement & 401(k) Plan
Town & Country Electric, Inc. Prevailing Wage Profit-Sharing Plan & Trust
Town & Country Electric, Inc. 401(k) Savings & Profit Sharing Plan & Trust
Tri-City Electrical 401(k) Retirement Plan
Tri-M Corporation 401(k) Profit Sharing & Savings Plan
United Service Solutions, Inc. 401(k) Plan
Walker Engineering, Inc. Employee Savings Plan & Trust Agreement
Watson Electrical Construction Co. 401(k) Plan
Wilson Electric Company, Inc. Profit Sharing Plan
(vii)
<PAGE>
All assets and liabilities of the Merged Plans are transferred to and made a
part of the Plan as of the dates set forth in Addendum B hereto. In no event
shall a Participant's vested interest in his sub-account attributable to amounts
transferred to the Plan from one of the Merged Plans (his "Transferee Sub-
Account") on and after the Merger Date be less than his vested interest in his
account under the Merged Plans immediately prior to the Merger Date.
Notwithstanding any other provision of the Plan to the contrary, a Participant's
service credited for eligibility and vesting purposes under the Merged Plan as
of the Merger Date, if any, shall be included as Eligibility and Vesting Service
under the Plan.
(viii)
<PAGE>
ARTICLE I
DEFINITIONS
1.1 Plan Definitions
As used herein, the following words and phrases have the meanings hereinafter
set forth, unless a different meaning is plainly required by the context:
"Account" means the account maintained by the Trustee in the name of a
Participant that reflects his interest in the Trust and any Sub-Accounts
maintained thereunder, as provided in Article VIII.
"Additional Discretionary Matching Contribution" means any Matching Contribution
made to the Plan at an Employer's discretion in addition to the Employer's
Regular Matching Contribution as provided in Article VI.
"Administrator" means the Committee as described in Article XVIII.
"Beneficiary" of a Participant means the person or persons entitled under the
provisions of the Plan to receive a distribution hereunder in the event the
Participant dies before receiving a distribution of his entire interest under
the Plan.
"Benefit Payment Date" means (i) if payment is made through the purchase of an
annuity, the first day of the first period for which the annuity is payable or
(ii) if payment is made in any other form, the first day on which all events
have occurred which entitle the Participant to receive payment of his benefit.
"Break in Service" means any "computation period" (as defined in Section 2.1)
during which a person completes fewer than 501 Hours of Service except that no
person shall incur a Break in Service solely by reason of temporary absence from
work not exceeding 24 months resulting from illness, layoff, or other cause if
authorized in advance by an Employer or a Related Company pursuant to its
uniform leave policy, if his employment shall not otherwise be terminated during
the period of such absence.
"Code" means the Internal Revenue Code of 1986, as amended from time to time.
Reference to a Code section includes such section and any comparable section or
sections of any future legislation that amends, supplements, or supersedes such
section.
"Committee" means the administrative Committee under the Plan described in
Article XVIII.
"Compensation" of a Participant for any period means the wages as defined in
Code Section 3401(a), determined without regard to any rules that limit
compensation included
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in wages based on the nature or location of the employment or services
performed, and all other payments made to him for such period for services as an
Employee for which his Employer is required to furnish the Participant a written
statement under Code Sections 6041(d), 6051(a)(3), and 6052. Notwithstanding the
foregoing, Compensation shall not include moving expenses paid by the Employer.
In addition to the foregoing, Compensation includes any amount that would have
been included in the foregoing description, but for the Participant's election
to defer payment of such amount under Code Section 125, 402(e)(3), 402(h)(1)(B),
403(b), or 457(b) and certain contributions described in Code Section 414(h)(2)
that are picked up by the employing unit and treated as employer contributions.
In no event, however, shall the Compensation of a Participant taken into account
under the Plan for any Plan Year exceed $170,000 (subject to adjustment annually
as provided in Code Sections 401(a)(17)(B) and 415(d)).
"Disabled" means a Participant can no longer continue in the service of his
Employer because of a mental or physical condition that is likely to result in
death or is expected to continue for a period of at least six months. A
Participant shall be considered Disabled only if the Administrator determines he
is Disabled based on a written certificate of a physician that is acceptable to
the Administrator.
"Eligible Employee" means any Employee who has met the eligibility requirements
of Article III to participate in the Plan.
"Eligibility Service" of an Employee means the period or periods of service
credited to him under the provisions of Article II for purposes of determining
his eligibility to participate in the Plan as may be required under Article III.
"Employee" means any person classified by an Employer, in accordance with its
personnel policy, as an employee of the Employer, other than any such person who
is either (i) covered by a collective bargaining agreement that does not
specifically provide for coverage under the Plan, (ii) a nonresident alien who
does not receive United States source income, (iii) any person who is not on an
Employer's salaried or hourly payroll, who has agreed in writing to be treated
as other than an employee or whose compensation is reported to the Internal
Revenue Service on a form other than Form W-2, in each case regardless of
whether such person is treated as an employee for federal or state income tax
purposes; or (iv) any leased employee, as such term is defined in Section 414(n)
of the Code.
"Employer" means the Sponsor (if the Sponsor affirmatively adopts the Plan for
its employees as a participating employer) and any participating Related Company
that has adopted the Plan as provided under Article XX. Notwithstanding
anything herein to the contrary, employers who are participating employers under
the GroupMAC 401(k) Plan shall not be Employers for purposes of this Plan.
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"Employer Contribution" means the amount, if any, that an Employer contributes
to the Plan as may be provided under Article VI or Article XXII.
"Enrollment Date" means the first day of the payroll period coincident with or
next following the Participant's satisfaction of the eligibility requirements of
Article III (or as soon as administratively practicable thereafter).
"ERISA" means the Employee Retirement Income Security Act of 1974, as amended
from time to time. Reference to a section of ERISA includes such section and
any comparable section or sections of any future legislation that amends,
supplements, or supersedes such section.
"General Fund" means a fund maintained by the Trustee as required to hold and
administer any assets of the Trust that are not allocated among any separate
Investment Funds as may be provided in the Plan or the Trust Agreement. No
General Fund shall be maintained if all assets of the Trust are allocated among
separate Investment Funds.
"Highly Compensated Employee" means any employee who meets one of the following
criteria:
(a) was at any time a Five Percent (5%) Owner (within the meaning of Code
Section 416(i)) of an Employer during the Plan Year or the previous
Plan Year; or
(b) received compensation (within the meaning of Code Section 415(c)(3))
from an Employer for the previous Plan Year in excess of $80,000
(subject to adjustment annually at the same time and in the same
manner as under Code Section 415(d)).
Notwithstanding anything herein to the contrary, the determination of who is a
Highly Compensated Employee hereunder, shall be made in accordance with the
provisions of Code Section 414(q) and regulations issued thereunder.
"Hour of Service" with respect to a person means each hour, if any, that may be
credited to him in accordance with the provisions of Article II.
"Investment Fund" means any separate investment fund maintained under the Trust
by the Trustee as may be provided in the Plan or the Trust Agreement, to which
assets of the Trust may be allocated and separately invested.
"Matching Contribution" means any Employer Contribution made to the Plan on
account of a Participant's Tax-Deferred Contributions as provided in Article VI,
including Regular Matching Contributions and Additional Discretionary Matching
Contributions and any such contribution that is designated by an Employer as a
Qualified Matching Contribution.
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"Merged Plan Accounts" means a Participant's accumulated contributions and
accounts, including related investment earnings thereon under a Merged Plan
prior to the date of merger with this Plan, as such plans may be identified in
the Preamble.
"Normal Retirement Date" or "Normal Retirement Age" of a Participant means the
date he attains age 59 1/2; provided, however, that to the extent required to
satisfy Section 411 of the Code, and as provided in Addendum B hereto, the
Normal Retirement Date with respect to any Participant shall be the normal
retirement date that would have applied with respect to his Merged Accounts, if
any.
"Participant" means any person who has an Account in the Trust pursuant to this
Plan.
"Plan" means the Building One Employee Savings 401(k) Plan, as contained herein
and as it may be amended from time to time.
"Plan Year" means the 12-consecutive-month period ending each December 31,
except that the first Plan Year shall begin on April 1 and end on December 31.
"Predecessor Employer" means any company that is a predecessor organization to
an Employer under the Code, provided that the Employer maintains a plan of such
predecessor organization, as contemplated under Section 414(a) of the Code.
"Prior After-Tax Contributions" means any after-tax employee contribution made
by a Participant to another plan that is transferred directly to the Plan as
permitted in Article V.
"Prior Profit Sharing Contributions" means any profit-sharing contributions
transferred to the Plan in connection with the merger of a Merged Plan into this
Plan effective as of April 1, 2000.
"Qualified Joint and Survivor Annuity," as provided in the Addendum, means an
immediate annuity payable at earliest retirement age under the Plan, as defined
in regulations issued under Code Section 401(a)(11), that is payable (i) for the
life of a Participant, if the Participant is not married, or (ii) for the life
of a Participant with a survivor annuity payable for the life of the
Participant's spouse that is equal to 50 percent of the amount of the annuity
payable during the joint lives of the Participant and his spouse, if the
Participant is married. Notwithstanding the foregoing, the Qualified Joint and
Survivor Annuity payable with respect to any particular Merged Plan may provide
a spousal survivor annuity in excess of 50 percent, if provided under the Plan.
"Qualified Preretirement Survivor Annuity," as provided in the Addendum, means
an annuity payable for the life of a Participant's surviving spouse if the
Participant dies prior to his Benefit Payment Date.
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"Qualified Matching Contribution" means any Matching Contribution made to the
Plan as provided in Article VI that is 100 percent vested when made and may be
taken into account to satisfy the limitations on Tax-Deferred Contributions made
by Highly Compensated Employees under Article VII.
"Qualified Nonelective Contribution" means any Employer Contribution made to the
Plan as provided in Article VI that is 100 percent vested when made and may be
taken into account to satisfy the limitations on Tax-Deferred Contributions
and/or Matching Contributions made by Highly Compensated Employees under Article
VII, other than Qualified Matching Contributions.
"Regular Matching Contribution" means any Matching Contribution made to the Plan
at the rate specified in Article VI, other than the following:
(a) any Additional Discretionary Matching Contribution.
(b) any Matching Contribution characterized as a Qualified Matching
Contribution.
"Related Company" means any corporation or other business, which would be
aggregated with the Sponsor under Code Section 414(b), (c), (m) or (o).
"Required Beginning Date" means the following:
(a) for a Participant who is not a "five percent owner," April 1 of the
calendar year following the calendar year in which occurs the later of the
Participant's (i) attainment of age 70 1/2 or (ii) the Participant's
retirement.
(b) for a Participant who is a "five percent owner," April 1 of the calendar
year following the calendar year in which the Participant attains age 70
1/2.
A Participant is a "five percent owner" if he is a five percent owner, as
defined and determined in accordance with Code Section 416(i), but without
regard to whether the Plan is top-heavy, for the Plan Year ending with or within
the calendar year in which the Participants attains age 70 1/2. The "required
beginning date" of a Participant who is a "five percent owner" hereunder shall
not be redetermined if the Participant ceases to be a five percent owner as
defined in Code Section 416(i) with respect to any subsequent Plan Year.
Notwithstanding anything herein to the contrary, the determination of a
Participant's Required Beginning Date shall be made in accordance with Section
401(a)(9) of the Code.
"Rollover Contribution" means any rollover contribution to the Plan made by a
Participant as may be permitted under Article V.
"Settlement Date" of a Participant means the date on which a Participant's
interest under the Plan becomes distributable in accordance with Article XV.
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"Single Life Annuity," as provided in the Addendum, means an annuity payable for
the life of a Participant.
"Sponsor" means Encompass Services Corporation, and any successor thereto.
"Sub-Account" means any of the individual sub-accounts of a Participant's
Account that is maintained as provided in Article VIII.
"Tax-Deferred Contribution" means the amount contributed to the Plan on a
Participant's behalf by his Employer in accordance with Article IV.
"Transferee Sub-Account" means a Participant's vested interest in his sub-
account attributable to amounts transferred to the Plan from one of the Merged
Plans.
"Trust" or "Trust Fund" means the trust, custodial accounts, annuity contracts,
or insurance contracts maintained by the Trustee under the Trust Agreement.
"Trust Agreement" means any agreement or agreements entered into between the
Sponsor and the Trustee relating to the holding, investment, and reinvestment of
the assets of the Plan, together with all amendments thereto and shall include
any agreement establishing a custodial account, an annuity contract, or an
insurance contract (other than a life, health or accident, property, casualty,
or liability insurance contract) for the investment of assets if the custodial
account or contract would, except for the fact that it is not a trust,
constitute a qualified trust under Code Section 501(a).
"Trustee" means the trustee or any successor trustee which at the time shall be
designated, qualified, and acting under the Trust Agreement and shall include
any insurance company that issues an annuity or insurance contract pursuant to
the Trust Agreement or any person holding assets in a custodial account pursuant
to the Trust Agreement. The Sponsor may designate a person or persons other than
the Trustee to perform any responsibility of the Trustee under the Plan, other
than trustee responsibilities as defined in ERISA Section 405(c)(3), and the
Trustee shall not be liable for the performance of such person in carrying out
such responsibility except as otherwise provided by ERISA. The term Trustee
shall include any delegate of the Trustee as may be provided in the Trust
Agreement.
"Valuation Date" means each business day that the Trust (or sub portions
thereof) are valued to reflect the effect of income received and accrued,
realized and unrealized profits and losses and all other transactions since the
preceding Valuation Date or any such other date as may be determined by the
Committee, which dates need not be uniform with respect to the General Fund,
each Investment Fund, Account, or Sub-Account; provided, however, that the
General Fund and each Investment Fund shall be valued and each Account and Sub-
Account shall be adjusted no less often than once annually.
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"Vesting Service" of an employee means the period or periods of service credited
to him under the provisions of Article II for purposes of determining his vested
interest in his Employer Contributions Sub-Account.
"Wage Rate Contributions" means any contribution made to the Plan by the
Employer as set forth in Section 6.4.
1.2 Interpretation
Where required by the context, the noun, verb, adjective, and adverb forms of
each defined term shall include any of its other forms. Wherever used herein,
the masculine pronoun shall include the feminine, the singular shall include the
plural, and the plural shall include the singular.
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ARTICLE II
SERVICE
2.1 Special Definitions
For purposes of this Article, the following terms have the following meanings.
A "computation period" for purposes of determining an Employee's years of
Eligibility Service means (i) the 12-consecutive-month period beginning on the
first date he completes an Hour of Service, and (ii) each Plan Year beginning
after such date; provided, however, that if an employee first completed an Hour
of Service prior to the effective date of the Plan, a Plan Year shall not mean
any short Plan Year beginning on the effective date of the Plan, if any, but
shall mean any 12-consecutive-month period beginning after the first date the
employee completes an Hour of Service and before the effective date of the Plan
that would have been a Plan Year if the Plan had been in effect.
A "computation period" for purposes of determining an Employee's years of
Vesting Service means each Plan Year; provided, however, that if an employee
first completed an Hour of Service prior to the effective date of the Plan, a
Plan Year shall not mean any short Plan Year beginning on the effective date of
the Plan, if any, but shall mean any 12-consecutive-month period beginning
before the effective date of the Plan that would have been a Plan Year if the
Plan had been in effect.
The "continuous service" of an employee means the continuous service credited to
him in accordance with the provisions of this Article.
The "employment commencement date" of an employee means the date he first
completes an Hour of Service.
A "maternity/paternity absence" means a person's absence from employment with an
Employer or a Related Company because of the person's pregnancy, the birth of
the person's child, the placement of a child with the person in connection with
the person's adoption of the child, or the caring for the person's child
immediately following the child's birth or adoption. A person's absence from
employment will not be considered a maternity/paternity absence unless the
person furnishes the Administrator such timely information as may reasonably be
required to establish that the absence was for one of the purposes enumerated in
this paragraph and to establish the number of days of absence attributable to
such purpose.
The "re-employment commencement date" of an employee means the first date
following a "severance date" on which he again completes an Hour of Service.
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The "severance date" of an employee means the earlier of (i) the date on which
he retires, dies, or his employment with all Employers and Related Companies is
otherwise terminated, or (ii) the first anniversary of the first date of a
period during which he is absent from work with all Employers and Related
Companies for any other reason; provided, however, that if he terminates
employment with or is absent from work with all Employers and Related Companies
on account of service with the armed forces of the United States, he shall not
incur a "severance date" if he is eligible for re-employment rights under the
Uniformed Services Employment and Re-employment Rights Act of 1994 and he
returns to work with an Employer or a Related Company within the period during
which he retains such re-employment rights, but, if he does not return to work
within such period, his "severance date" shall be the earlier of the date which
is one year after his absence commenced or the last day of the period during
which he retains such re-employment rights.
2.2 Crediting of Hours of Service
A person shall be credited with an Hour of Service for:
(a) each hour for which he is paid, or entitled to payment, for the performance
of duties for an Employer, a Predecessor Employer, or a Related Company
during the applicable "computation period"; provided, however, that hours
compensated at a premium rate shall be treated as straight-time hours;
(b) subject to the provisions of Section 2.4, each hour for which he is paid,
or entitled to payment, by an Employer, a Predecessor Employer, or a
Related Company on account of a period of time during which no duties are
performed (irrespective of whether the employment relationship has
terminated) due to vacation, holiday, illness, incapacity (including
disability), lay-off, jury duty, military duty, or leave of absence;
(c) each hour for which he would have been scheduled to work for an Employer, a
Predecessor Employer, or a Related Company during the period that he is
absent from work because of service with the armed forces of the United
States provided he is eligible for re-employment rights under the Uniformed
Services Employment and Re-Employment Rights Act of 1994 and returns to
work with an Employer or a Related Company within the period during which
he retains such re-employment rights;
(d) each hour for which back pay, irrespective of mitigation of damages, is
either awarded or agreed to by an Employer, a Predecessor Employer, or a
Related Company; provided, however, that the same Hour of Service shall not
be credited both under paragraph (a) or (b) or (c) of this Section, as the
case may be, and under this paragraph (d); and provided, further, that the
crediting of Hours of Service for back pay awarded or agreed to with
respect to periods described in
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<PAGE>
such paragraph (b) shall be subject to the limitations set forth therein
and in Section 2.4;
(e) solely for purposes of determining whether a person who is on a
"maternity/paternity absence" has incurred a Break in Service for a
"computation period", Hours of Service shall include those hours with which
such person would otherwise have been credited but for such
"maternity/paternity absence", or shall include eight Hours of Service for
each day of "maternity/paternity absence" if the actual hours to be
credited cannot be determined; except that not more than 501 hours are to
be credited by reason of any "maternity/paternity absence"; provided,
however, that any hours included as Hours of Service pursuant to this
paragraph shall be credited to the "computation period" in which the
absence from employment begins, if such person otherwise would incur a
Break in Service in such "computation period", or, in any other case, to
the immediately following "computation period"; and
(f) solely for purposes of determining whether he has incurred a Break in
Service, each hour for which he would have been scheduled to work for an
Employer, a Predecessor Employer, or a Related Company during the period of
time that he is absent from work on an approved leave of absence pursuant
to the Family and Medical Leave Act of 1993; provided, however, that Hours
of Service shall not be credited to an employee under this paragraph if the
employee fails to return to employment with an Employer or Related Company
following such leave.
Except as otherwise specifically provided with respect to Predecessor Employers,
Hours of Service shall not be credited for employment with a corporation or
business prior to the date such corporation or business becomes a Related
Company.
2.3 Hours of Service Equivalencies
Notwithstanding any other provision of the Plan to the contrary, if an Employer
does not maintain records that accurately reflect actual hours of service, such
Employer shall credit Hours of Service to its employees in accordance with one
of the following equivalencies:
(a) If the Employer maintains its records on the basis of days worked, an
employee shall be credited with 10 Hours of Service for each day on which
he performs an Hour of Service.
(b) If the Employer maintains its records on the basis of weeks worked, an
employee shall be credited with 45 Hours of Service for each week in which
he performs an Hour of Service.
(c) If the Employer maintains its records on the basis of semi-monthly payroll
periods, an employee shall be credited with 95 Hours of Service for each
semi-monthly payroll period in which he performs an Hour of Service.
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<PAGE>
(d) If the Employer maintains its records on the basis of months worked, an
employee shall be credited with 190 Hours of Service for each month in
which he performs an Hour of Service.
2.4 Limitations on Crediting of Hours of Service
In the application of the provisions of paragraph (b) of Section 2.2, the
following shall apply:
(a) An hour for which a person is directly or indirectly paid, or entitled to
payment, on account of a period during which no duties are performed shall
not be credited to him if such payment is made or due under a plan
maintained solely for the purpose of complying with applicable workers'
compensation, unemployment compensation, or disability insurance laws.
(b) Hours of Service shall not be credited with respect to a payment which
solely reimburses a person for medical or medically-related expenses
incurred by him.
(c) A payment shall be deemed to be made by or due from an Employer, a
Predecessor Employer, or a Related Company (i) regardless of whether such
payment is made by or due from such employer directly or indirectly,
through (among others) a trust fund or insurer to which any such employer
contributes or pays premiums, and (ii) regardless of whether contributions
made or due to such trust fund, insurer, or other entity are for the
benefit of particular persons or are on behalf of a group of persons in the
aggregate.
(d) No more than 501 Hours of Service shall be credited to a person on account
of any single continuous period during which he performs no duties (whether
or not such period occurs in a single "computation period"), unless no
duties are performed due to service with the armed forces of the United
States for which the person retains re-employment rights as provided in
paragraph (c) of Section 2.2.
2.5 Department of Labor Rules
The rules set forth in paragraphs (b) and (c) of Department of Labor Regulations
Section 2530.200b-2, which relate to determining Hours of Service attributable
to reasons other than the performance of duties and crediting Hours of Service
to "computation periods", are hereby incorporated into the Plan by reference.
2.6 Crediting of "Continuous Service"
A person shall be credited with "continuous service" for the aggregate of the
periods of time between his "employment commencement date" or any "re-employment
commencement date" and the "severance date" that next follows such "employment
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commencement date" or "re-employment commencement date"; provided, however, that
an employee who has a "re-employment commencement date" within the 12-
consecutive-month period following the earlier of the first date of his absence
or his "severance date" (as defined in clause (i) of that definition) shall be
credited with "continuous service" for the period between his first date of
absence or "severance date" (as defined in clause (i) of that definition) and
"re-employment commencement date".
2.7 Eligibility Service
A full-time employee shall be credited with Eligibility Service equal to his
"continuous service". An employee who is not a full-time employee shall be
credited with one year of Eligibility Service for each computation period in
which he is credited with at least 1,000 Hours of Service.
"Full-time employee" means an employee who is expected to work 1,000 or more
hours during each 12-consecutive-month period.
2.8 Years of Vesting Service; Vesting Service After Reemployment
An employee (full-time or otherwise) shall be credited with a year of Vesting
Service for each "computation period" during which he is credited with at least
1,000 Hours of Service.
If an employee terminates employment after becoming vested in Employer
Contributions hereunder, he shall be vested immediately in future Employer
Contributions made on his behalf upon his reparticipation in the Plan. If an
employee terminates employment without having been vested in Employer
Contributions hereunder, he shall be entitled to have his Vesting Service
rendered prior to his termination of employment restored and counted as Vesting
Service if he returns to service with an Employer before he has had five (5)
consecutive one-year Breaks In Service. His entitlement to resume vesting in
Employer Contributions that were forfeited upon his initial termination of
service shall be determined in accordance with the provisions of Article XIV.
2.9 Crediting of Service on Transfer or Amendment
Notwithstanding any other provision of the Plan to the contrary, if any Employee
is transferred from employment covered under a qualified plan maintained by an
Employer or a Related Company for which service for vesting purposes is credited
based on elapsed time in accordance with Treasury Regulations Section 1.410(a)-7
to employment covered under the Plan or, any Employee who is not a full-time
employee is transferred from employment covered under a qualified plan
maintained by an Employer or a Related Company for which service for eligibility
purposes is credited based on elapsed time, an affected Employee shall be
credited with Eligibility Service and/or Vesting Service hereunder as provided
in Treasury Regulations Section 1.410(a)-7(f)(1).
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Notwithstanding any other provision of the Plan to the contrary, if a full-time
Employee is transferred from employment covered under a qualified plan
maintained by an Employer or a Related Company for which service for eligibility
purposes is credited based on Hours of Service and computation periods in
accordance with Department of Labor Regulations Sections 2530.200 through
2530.203, an affected Employee shall be credited with Eligibility Service
hereunder as provided in Treasury Regulation Section 1.410(a)-7(f)(1).
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ARTICLE III
ELIGIBILITY
3.1 Eligibility
With respect to eligibility to receive Wage Rate Contributions, each Employee
shall become an Eligible Employee as of the date he becomes an Employee.
With respect to eligibility to participate in all other aspects of the Plan,
each other Employee shall become an Eligible Employee as of the Enrollment Date
coinciding with or next following the date on which he has both attained age 18
and completed one of the following eligibility requirements:
(a) one year of Eligibility Service; or
(b) with respect to full-time employees as defined in Section 2.7, if earlier,
90 days of Eligibility Service.
3.2 Transfers of Employment
If a person is transferred directly from employment with an Employer or with a
Related Company in a capacity other than as an Employee to employment as an
Employee, he shall become an Eligible Employee as of the date he is so
transferred if prior to an Enrollment Date coinciding with or preceding such
transfer date he has met the eligibility requirements of Section 3.1.
Otherwise, the eligibility of a person who is so transferred to participate in
the Plan shall be determined in accordance with Section 3.1.
3.3 Re-employment
The eligibility of a person to re-participate in the Plan who was neither vested
nor a participant at the time of his initial termination of employment with an
Employer and all Related Companies and who is re-employed by an Employer or a
Related Company shall be determined in accordance with Section 3.1 or 3.2. If a
person who terminated employment with an Employer and all Related Companies is
re-employed as an Employee and if he had been an Eligible Employee and vested
prior to his termination of employment, he shall again become an Eligible
Employee on the date he is re-employed. If a person who terminated employment
with an Employer and all Related Companies is re-employed as an Employee and if
he had been an Eligible Employee but had not yet vested prior to his termination
of employment, then he shall be readmitted as a Participant in the Plan in
accordance with Sections 3.1 or 3.2; provided however, that if his termination
of employment resulted in at least five (5) consecutive one-year Breaks in
Service, then he shall lose all prior eligibility service previously accrued
hereunder.
3.4 Notification Concerning New Eligible Employees
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Each Employer shall notify the Administrator as soon as practicable of Employees
becoming Eligible Employees as of any date.
3.5 Effect and Duration
Upon becoming an Eligible Employee, an Eligible Employee shall be entitled to
make Tax-Deferred Contributions to the Plan in accordance with the provisions of
Article IV and receive allocations of Employer Contributions in accordance with
the provisions of Article VI (provided he meets any applicable requirements
thereunder) and shall be bound by all the terms and conditions of the Plan and
the Trust Agreement. A person shall continue as an Eligible Employee eligible to
make Tax-Deferred Contributions to the Plan and to participate in allocations of
Employer Contributions only so long as he continues employment as an Employee.
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ARTICLE IV
TAX-DEFERRED CONTRIBUTIONS
4.1 Tax-Deferred Contributions
Effective as of the date he becomes an Eligible Employee, each Eligible Employee
may elect, in accordance with rules prescribed by the Administrator, to have
Tax-Deferred Contributions made to the Plan on his behalf by his Employer as
hereinafter provided. An Eligible Employee's election shall include his
authorization for his Employer to reduce his Compensation and to make Tax-
Deferred Contributions on his behalf. An Eligible Employee who elects not to
have Tax-Deferred Contributions made to the Plan as of the first Enrollment Date
he becomes eligible to participate may change his election by amending his
reduction authorization as prescribed in this Article.
Tax-Deferred Contributions on behalf of an Eligible Employee shall commence with
the first payment of Compensation made on or after the date on which his
election is effective.
4.2 Amount of Tax-Deferred Contributions
The amount of Tax-Deferred Contributions to be made to the Plan on behalf of an
Eligible Employee by his Employer shall be a whole number percentage of his
Compensation up to 15 percent. In the event an Eligible Employee elects to have
his Employer make Tax-Deferred Contributions on his behalf, his Compensation
shall be reduced for each payroll period by the percentage he elects to have
contributed on his behalf to the Plan in accordance with the terms of his
currently effective reduction authorization.
4.3 Amendments to Reduction Authorization
An Eligible Employee may elect, on a daily or such other less frequent basis as
the Administrator may prescribe, and in a manner as the Administrator shall
provide, to change the amount of his future Compensation that his Employer
contributes on his behalf as Tax-Deferred Contributions, such change having
effect as of the next following payroll period or as soon as administratively
practicable thereafter. An Eligible Employee who amends his reduction
authorization shall be limited to selecting an amount of his Compensation that
is otherwise permitted under this Article IV.
4.4 Suspension of Tax-Deferred Contributions
An Eligible Employee on whose behalf Tax-Deferred Contributions are being made
may elect, on a daily or such other less frequent basis as the Administrator may
prescribe, and in a manner as the Administrator shall provide, to suspend his
Tax-Deferred Contributions, such suspension having effect as of the next
following payroll period or as
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soon as administratively practicable thereafter. Any such voluntary suspension
shall remain in effect until Tax-Deferred Contributions are resumed as
hereinafter set forth.
4.5 Resumption of Tax-Deferred Contributions
An Eligible Employee who has voluntarily suspended his Tax-Deferred
Contributions may elect, on a daily or such other less frequent basis as the
Administrator may prescribe, and in the manner prescribed by the Administrator,
to have such contributions resumed.
4.6 Delivery of Tax-Deferred Contributions
As soon after the date an amount would otherwise be paid to an Employee as it
can reasonably be separated from Employer assets, each Employer shall cause to
be delivered to the Trustee in cash all Tax-Deferred Contributions attributable
to such amounts. In no event shall such withheld amounts be delivered to the
Trustee later than the date required by Department of Labor Regulations Section
2510.3-102(b).
4.7 Vesting of Tax-Deferred Contributions
A Participant's vested interest in his Tax-Deferred Contributions Sub-Account
shall be at all times 100 percent.
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ARTICLE V
AFTER-TAX AND ROLLOVER CONTRIBUTIONS
5.1 Transferred After-Tax Contributions
Eligible Employees are not currently permitted to make After-Tax Contributions
to the Plan. However, a Participant's Account may include Prior After-Tax
Contributions.
5.2 Rollover Contributions
An Employee who was a participant in a plan qualified under Code Section 401 and
who receives (or is eligible to receive) a cash distribution from such plan that
he elects either (i)to roll over to a qualified retirement plan or (ii)to roll
over into a conduit IRA from which he receives a later cash distribution, may
elect to make a Rollover Contribution of such distribution to the Plan if he is
entitled under Code Section 402(c) or 408(d)(3)(A) to roll over such
distribution to another qualified retirement plan (either via a direct rollover
or conventional rollover within 60 days). The Administrator may require an
Employee to provide it with such information as it seems necessary or desirable
to show that he is entitled to roll over such distribution to another qualified
retirement plan. An Employee who has not elected a direct rollover to the Plan
shall make a Rollover Contribution to the Plan by delivering, or causing to be
delivered, to the Trustee the cash that constitutes the Rollover Contribution
amount within 60 days of receipt of the distribution from the plan or from the
conduit IRA in the manner prescribed by the Administrator.
5.3 Vesting of Prior After-Tax Contributions and Rollover Contributions
A Participant's vested interest in his Prior After-Tax Contributions Sub-Account
and his Rollover Contributions Sub-Account shall be at all times 100 percent.
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ARTICLE VI
EMPLOYER CONTRIBUTIONS
6.1 Contribution Period
The Contribution Periods for Employer Contributions shall be as follows:
(a) The Contribution Period for Regular Matching Contributions under the Plan
is the Employer's payroll period.
(b) The Contribution Period for Additional Discretionary Matching Contributions
is the Plan Year.
(c) The Contribution Period for Discretionary Profit Sharing Contributions is
the Plan Year.
(d) The Contribution Period for Qualified Nonelective Contributions under the
Plan is the Plan Year.
(e) The Contribution Period for Wage Rate Contributions under the Plan is the
Plan Year, or such other period as may be required by law.
6.2 Qualified Nonelective Contributions
Each Employer may make a Qualified Nonelective Contribution to the Plan for the
Contribution Period in an amount determined by the Sponsor.
6.3 Allocation of Qualified Nonelective Contributions
Any Qualified Nonelective Contribution made for a Contribution Period shall be
allocated among the Eligible Employees during the Contribution Period who have
met the allocation requirements for Qualified Nonelective Contributions
described in this Article, other than any such Eligible Employee who is a Highly
Compensated Employee. The allocable share of each such Eligible Employee in the
Qualified Nonelective Contribution shall be as determined by the Administrator.
Amounts that are contributed as Qualified Nonelective Contributions shall be
accounted for separately and may be withdrawn only as permitted under the Plan.
6.4 Amount and Allocation of Wage Rate Contributions
If applicable, each Employer shall make a Wage Rate Contribution to the Plan for
each Contribution Period on behalf of each of its Employees employed on a
project covered by a "prevailing rate schedule". Wage Rate Contributions shall
be equal to the "fringe benefit rate" determined for each such Employee
multiplied by each Hour of Service he
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has performed since the last day of the preceding calendar quarter. For purposes
of this Section, "prevailing rate schedule" means the schedule published by the
United States Department of Labor, indicating the minimum hourly rate for wage
and fringe benefits (including but not limited to retirement benefits) that must
be paid to Employees of an Employer working on particular jobs financed and/or
contracted by the United States, State of California, or any of the states,
counties, municipalities and/or other governmental entities. Such schedule shall
be that schedule required to be applied by the Employer on the particular job
under which the Employee is performing services. "Fringe benefit rate" means for
each applicable class of Employees, the hourly rate that is part of the
prevailing wage rate in the "prevailing rate schedule."
6.5 Amount and Allocation of Regular Matching Contributions
Each Employer shall make a Regular Matching Contribution to the Plan for each
Contribution Period on behalf of each of its Eligible Employees during the
Contribution Period who has met the allocation requirements for Regular Matching
Contributions described in this Article.
Subject to Section 6.7, the amount of such Regular Matching Contribution shall
be equal to 50 percent of the aggregate Tax-Deferred Contributions made for the
Contribution Period by or on behalf of such Eligible Employee.
6.6 Additional Discretionary Matching Contributions
In addition to its Regular Matching Contribution, each Employer may make an
Additional Discretionary Matching Contribution to the Plan for each Contribution
Period on behalf of each of its Eligible Employees who has met the allocation
requirements for Additional Discretionary Matching Contributions described in
this Article. The amount of any such Additional Discretionary Matching
Contribution with respect to similarly situated Eligible Employees, as
determined by the Employer in a non-discriminatory manner, shall be equal to a
uniform percentage, determined by the Employer, in its discretion, of the Tax-
Deferred Contributions made on behalf of each such similarly situated Eligible
Employee for the Contribution Period. Notwithstanding anything herein to the
contrary, no Additional Discretionary Matching Contributions shall be made on
behalf of any Eligible Employees who are Highly Compensated Employees for the
year to which such contributions relate.
6.7 Limit on Tax-Deferred Contributions Matched
Notwithstanding any other provision of this Article to the contrary, Tax-
Deferred Contributions made to the Plan on behalf of an Eligible Employee for a
Contribution Period that exceed six percent of the Eligible Employee's
Compensation for the Contribution Period shall be excluded in determining the
amount and allocation of Regular Matching Contributions with respect to such
Eligible Employee for the Contribution Period.
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6.8 Qualified Matching Contributions
An Employer may designate any portion or all of its Matching Contribution as a
Qualified Matching Contribution. Amounts that are designated as Qualified
Matching Contributions shall be accounted for separately and may be withdrawn
only as permitted under the Plan.
6.9 Discretionary Profit-Sharing Contributions
In addition to its other contributions under this Article, each Employer may
make a Discretionary Profit-Sharing Contribution to the Plan for each
Contribution Period on behalf of each of its Eligible Employees who has met the
allocation requirements for Discretionary Profit-Sharing Contributions
described in this Article. Notwithstanding anything herein to the contrary, no
Discretionary Profit-Sharing Contributions shall be made on behalf of any
Eligible Employees who are Highly Compensated Employees for the year to which
such contributions relate. Discretionary Profit-Sharing Contributions for each
Contribution Period shall be allocated among the Eligible Employees of the
Employer that elected to make the contribution, in the ratio in which such
Eligible Employees' Compensation bears to the aggregate Compensation of all such
Eligible Employees of the contributing Employer for the Contribution Period.
6.10 Verification of Amount of Employer Contributions by the Sponsor
The Administrator shall verify the amount of Employer Contributions to be made
by each Employer in accordance with the provisions of the Plan. Notwithstanding
any other provision of the Plan to the contrary, the Administrator shall
determine the portion of the Employer Contribution to be made by each Employer
with respect to an Employee who transfers from employment with one Employer as
an Employee to employment with another Employer as an Employee.
6.11 Payment of Employer Contributions
Employer Contributions made for a Contribution Period shall be paid in cash to
the Trustee within the period of time required under the Code in order for the
contribution to be deductible by the Employer in determining its Federal income
taxes for the Plan Year.
6.12 Allocation Requirements for Employer Contributions
A person who was an Eligible Employee at any time during a Contribution Period
shall be eligible to receive an allocation of Regular Matching Contributions for
such Contribution Period.
A person who was an Eligible Employee during a Contribution Period shall be
eligible to receive an allocation of Additional Discretionary Matching
Contributions and
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Discretionary Profit-Sharing Contributions for such Contribution Period only if
he is employed as an Employee on the last day of the Contribution Period.
A person who was an Eligible Employee at any time during a Contribution Period
shall be eligible to receive an allocation of Wage Rate Contributions for such
Contribution Period.
A person who was an Eligible Employee at any time during a Contribution Period
shall be eligible to receive an allocation of Qualified Nonelective
Contributions for such Contribution Period.
6.13 Exceptions to Allocation Requirements for Employer Contributions
Notwithstanding any other provision of the Plan to the contrary, the last day
allocation requirement described above shall not apply to any Participant who
would have otherwise been eligible to receive an allocation if he had not
terminated employment during the Contribution Period on or after his Normal
Retirement Date or he had not died or sustained a Disability during the
Contribution Period.
6.14 Vesting of Employer Contributions
A Participant's vested interest in his Qualified Nonelective and Qualified
Matching Contributions Sub-Accounts shall be at all times 100 percent.
With respect to an Employee who became a Participant in connection with the
merger of a plan into this Plan that provided 100 percent immediate vesting in
employer contributions prior to such merger, such Participant shall continue to
be 100 percent vested in the value of the Employer Contributions in his Account
under the Plan.
With respect to all other Participants, a Participant's vested interest in his
Regular and Additional Discretionary Matching Contributions, Discretionary
Profit-Sharing Contributions, Wage Rate Contributions and Prior Profit-Sharing
Contributions Sub-Accounts shall be zero percent until the Participant has
completed one year of Vesting Service at which time his vested interest in his
Matching Contributions Sub-Account shall be 100 percent.
Notwithstanding the foregoing, if a Participant is employed by an Employer or a
Related Company on his Normal Retirement Date, the date he becomes Disabled, or
the date he dies, his vested interest in his Regular and Additional
Discretionary Matching Contributions, Discretionary Profit-Sharing
Contributions, Wage Rate Contributions and Prior Profit-Sharing Contributions
Sub-Accounts shall be 100 percent.
As described in Article III, and notwithstanding any other provision of the Plan
to the contrary, a Participant's service credited for vesting purposes under a
Merged Plan as of the Merger Date, if any, shall be included as Vesting Service
under the Plan.
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<PAGE>
6.15 Election of Former Vesting Schedule
If the Sponsor adopts an amendment to the Plan that directly or indirectly
affects the computation of a Participant's vested interest in his Employer
Contributions Sub-Account, any Participant with three or more years of Vesting
Service shall have a right to have his vested interest in his Employer
Contributions Sub-Account continue to be determined under the vesting provisions
in effect prior to the amendment rather than under the new vesting provisions,
unless the vested interest of the Participant in his Employer Contributions Sub-
Account under the Plan as amended is not at any time less than such vested
interest determined without regard to the amendment. A Participant shall
exercise his right under this Section by giving written notice of his exercise
thereof to the Administrator within 60 days after the latest of (i) the date he
receives notice of the amendment from the Administrator, (ii) the effective date
of the amendment, or (iii) the date the amendment is adopted. Notwithstanding
the foregoing, a Participant's vested interest in his Employer Contributions
Sub-Account on the effective date of such an amendment shall not be less than
his vested interest in his Employer Contributions Sub-Account immediately prior
to the effective date of the amendment.
6.16 Forfeitures to Reduce Employer Contributions
Notwithstanding any other provision of the Plan to the contrary, the amount of
the Employer Contribution required under this Article for a Plan Year shall be
reduced by the amount of any forfeitures occurring during the Plan Year that are
not used to pay Plan expenses and that are applied against Employer
Contributions as provided in Article XIV.
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ARTICLE VII
LIMITATIONS ON CONTRIBUTIONS
7.1 Definitions
For purposes of this Article, the following terms have the following meanings:
(a) The "aggregate limit" means the sum of (i) 125 percent of the greater of
the average "contribution percentage" for "eligible participants" other
than Highly Compensated Employees or the average "deferral percentage" for
Eligible Employees other than Highly Compensated Employees and (ii) the
lesser of 200 percent or two plus the lesser of such average "contribution
percentage" or average "deferral percentage", or, if it would result in a
larger "aggregate limit", the sum of (iii) 125 percent of the lesser of the
average "contribution percentage" for "eligible participants" other than
Highly Compensated Employees or the average "deferral percentage" for
Eligible Employees other than Highly Compensated Employees and (iv) the
lesser of 200 percent or two plus the greater of such average "contribution
percentage" or average "deferral percentage". For purposes of determining
the "aggregate limit", the "contribution percentages" and "deferral
percentages" used shall be for the applicable "testing year".
(b) The "annual addition" with respect to a Participant for a "limitation year"
means the sum of the Tax-Deferred Contributions and Employer Contributions
allocated to his Account for the "limitation year" (including any "excess
contributions" that are distributed pursuant to this Article), the employer
contributions, "employee contributions", and forfeitures allocated to his
accounts for the "limitation year" under any other qualified defined
contribution plan (whether or not terminated) maintained by an Employer or
a Related Company concurrently with the Plan, and amounts described in Code
Sections 415(l)(2) and 419A(d)(2) allocated to his account for the
"limitation year".
(c) The "contribution percentage" with respect to an "eligible participant" for
a particular Plan Year means the ratio of the Matching Contributions made
to the Plan on his behalf for the Plan Year to his "test compensation" for
such Plan Year. To the extent permitted by regulations issued under Code
Section 401(m), the Sponsor may elect to include the Tax-Deferred
Contributions and/or Qualified Nonelective Contributions made to the Plan
on an "eligible participant's" behalf for the Plan Year in computing the
numerator of such "eligible participant's" "contribution percentage".
Notwithstanding the foregoing, any Tax-Deferred Contributions, Qualified
Matching Contributions, and/or Qualified Nonelective Contributions that are
included in determining the numerator of an "eligible participant's"
"deferral percentage" may not be included in determining the numerator of
his "contribution percentage".
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Contributions made on an "eligible participant's" behalf for a Plan Year
shall be included in determining his "contribution percentage" for such
Plan Year only if the contributions are allocated to the "eligible
participant's" Account as of a date within such Plan Year and are made to
the Plan before the end of the 12-month period immediately following the
Plan Year to which the contributions relate. Contributions included for
purposes of determining the "contribution percentage" for the "testing
year" of an "eligible participant" who is not a Highly Compensated Employee
relate to the "testing year" and therefore must be made before the last day
of the Plan Year for which the limitation on Matching Contributions
described in Section 7.7 is being determined. The determination of an
"eligible participant's" "contribution percentage" shall be made after any
reduction required to satisfy the Code Section 415 limitations is made as
provided in this Article VII and shall satisfy such other requirements as
may be prescribed by the Secretary of the Treasury.
(d) The "deferral percentage" with respect to an Eligible Employee for a
particular Plan Year means the ratio of the Tax-Deferred Contributions made
on his behalf for the Plan Year to his "test compensation" for the Plan
Year. To the extent permitted by regulations issued under Code Section
401(k), the Sponsor may elect to include Qualified Matching Contributions
and/or Qualified Nonelective Contributions made to the Plan on the Eligible
Employee's behalf for the Plan Year in computing the numerator of such
Eligible Employee's "deferral percentage". Notwithstanding the foregoing,
any Tax-Deferred Contributions, Qualified Matching Contributions, and/or
Qualified Nonelective Contributions that are included in determining the
numerator of an Eligible Employee's "contribution percentage" may not be
included in determining the numerator of his "deferral percentage".
Contributions made on an Eligible Employee's behalf for a Plan Year shall
be included in determining his "deferral percentage" for such Plan Year
only if they meet the following requirements:
(1) Tax-Deferred Contributions must relate to Compensation that either (i)
would, but for the Eligible Employee's deferral election, have been
received by the Eligible Employee during such Plan Year or (ii) is
attributable to services performed by the Eligible Employee during
such Plan Year and would, but for the Eligible Employee's deferral
election, have been received by the Eligible Employee within two and
one-half months after the close of the Plan Year.
(2) They must be allocated to the Eligible Employee's Account as of a date
within such Plan Year.
(3) They must be made to the Plan before the end of the 12-month period
immediately following the Plan Year to which they relate.
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Qualified Matching Contributions and Qualified Nonelective Contributions
included for purposes of determining the "deferral percentage" of an
Eligible Employee who is not a Highly Compensated Employee relate to the
"testing year" and therefore must be made before the last day of the Plan
Year for which the limitation on Tax-Deferred Contributions described in
Section 7.4 is being determined.
The determination of an Eligible Employee's "deferral percentage" shall be
made after any reduction required to satisfy the Code Section 415
limitations is made as provided in this Article VII and shall satisfy such
other requirements as may be prescribed by the Secretary of the Treasury.
(e) An "elective contribution" means any employer contribution made to a plan
maintained by an Employer or a Related Company on behalf of a Participant
in lieu of cash compensation pursuant to his written election to defer
under any qualified CODA as described in Code Section 401(k), any
simplified employee pension cash or deferred arrangement as described in
Code Section 402(h)(1)(B), any eligible deferred compensation plan under
Code Section 457, or any plan as described in Code Section 501(c)(18), and
any contribution made on behalf of the Participant by an Employer or a
Related Company for the purchase of an annuity contract under Code Section
403(b) pursuant to a salary reduction agreement.
(f) An "eligible participant" means any Eligible Employee who is eligible to
have Tax-Deferred Contributions made on his behalf (if Tax-Deferred
Contributions are taken into account in determining "contribution
percentages"), or to participate in the allocation of Matching
Contributions.
(g) An "employee contribution" means any employee after-tax contribution
allocated to an "eligible participant's" Account under any qualified plan
of an Employer or a Related Company.
(h) An "excess deferral" with respect to a Participant means that portion of a
Participant's Tax-Deferred Contributions for his taxable year that, when
added to amounts deferred for such taxable year under other plans or
arrangements described in Code Section 401(k), 408(k), or 403(b) (other
than any such plan or arrangement that is maintained by an Employer or
Related Company), would exceed the dollar limit imposed under Code Section
402(g) as in effect on January 1 of the calendar year in which such taxable
year begins and is includible in the Participant's gross income under Code
Section 402(g).
(i) A "limitation year" means the Plan Year.
(j) A "matching contribution" means any employer contribution allocated to an
Eligible Employee's account under any plan of an Employer or a Related
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Company solely on account of "elective contributions" made on his behalf or
"employee contributions" made by him.
(k) A "qualified matching contribution" means any employer contribution
allocated to an Eligible Employee's account under any plan of an Employer
or a Related Company solely on account of "elective contributions" made on
his behalf or "employee contributions" made by him that is a qualified
matching contribution as defined in regulations issued under Code Section
401(k), is nonforfeitable when made, and is distributable only as permitted
in regulations issued under Code Section 401(k).
(l) A "qualified nonelective contribution" means any employer contribution
allocated to an Eligible Employee's account under any plan of an Employer
or a Related Company that the Participant could not elect instead to
receive in cash, that is a qualified nonelective contribution as defined in
Code Sections 401(k) and 401(m) and regulations issued thereunder, is
nonforfeitable when made, and is distributable only as permitted in
regulations issued under Code Section 401(k).
(m) The "test compensation" of an Eligible Employee or "eligible participant"
for a Plan Year means compensation as defined in Code Section 414(s) and
regulations issued thereunder, limited, however, to $150,000 (subject to
adjustment annually as provided in Code Sections 401(a)(17)(B) and 415(d);
provided, however, that the dollar increase in effect on January 1 of any
calendar year, if any, is effective for Plan Years beginning in such
calendar year) and, if elected by the Sponsor, further limited solely to
"test compensation" of an Employee attributable to periods of time when he
is an Eligible Employee or "eligible participant".
(n) The "testing year" means the Plan Year immediately preceding the Plan Year
for which the limitations on "deferral percentages" and "contribution
percentages" of Highly Compensated Employees are being determined.
7.2 Code Section 402(g) Limit
In no event shall the amount of the Tax-Deferred Contributions made on behalf of
an Eligible Employee for his taxable year, when aggregated with any "elective
contributions" made on behalf of the Eligible Employee under any other plan of
an Employer or a Related Company for his taxable year, exceed the dollar limit
imposed under Code Section 402(g), as in effect on January 1 of the calendar
year in which such taxable year begins. In the event that the Administrator
determines that the reduction percentage elected by an Eligible Employee will
result in his exceeding the Code Section 402(g) limit, the Administrator may
adjust the reduction authorization of such Eligible Employee by reducing the
percentage of his Tax-Deferred Contributions to such smaller percentage that
will result in the Code Section 402(g) limit not being exceeded. If the
Administrator determines that the Tax-Deferred Contributions made on behalf of
an Eligible Employee would exceed the Code Section 402(g) limit for his taxable
year, the
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Tax-Deferred Contributions for such Participant shall be automatically suspended
for the remainder, if any, of such taxable year.
If an Employer notifies the Administrator that the Code Section 402(g) limit has
nevertheless been exceeded by an Eligible Employee for his taxable year, the
Tax-Deferred Contributions that, when aggregated with "elective contributions"
made on behalf of the Eligible Employee under any other plan of an Employer or a
Related Company, would exceed the Code Section 402(g) limit, plus any income and
minus any losses attributable thereto, shall be distributed to the Eligible
Employee no later than the April 15 immediately following such taxable year.
Any Tax-Deferred Contributions that are distributed to an Eligible Employee in
accordance with this Section shall not be taken into account in determining the
---
Eligible Employee's "deferral percentage" for the "testing year" in which the
Tax-Deferred Contributions were made, unless the Eligible Employee is a Highly
Compensated Employee.
If an amount of Tax-Deferred Contributions is distributed to a Participant in
accordance with this Section, Matching Contributions that are attributable
solely to the distributed Tax-Deferred Contributions, plus any income and minus
any losses attributable thereto, shall be forfeited by the Participant as of the
last day of the month in which the distribution of Tax-Deferred Contributions
pursuant to this Section occurs.
7.3 Distribution of "Excess Deferrals"
Notwithstanding any other provision of the Plan to the contrary, if a
Participant notifies the Administrator in writing no later than the March 1
following the close of the Participant's taxable year that "excess deferrals"
have been made on his behalf under the Plan for such taxable year, the "excess
deferrals", plus any income and minus any losses attributable thereto, shall be
distributed to the Participant no later than the April 15 immediately following
such taxable year. Any Tax-Deferred Contributions that are distributed to a
Participant who is a Highly Compensated Employee in accordance with this Section
shall nevertheless be taken into account in determining the Participant's
"deferral percentage" for the "testing year" in which the Tax-Deferred
Contributions were made. If an amount of Tax-Deferred Contributions is
distributed to a Participant in accordance with this Section, Matching
Contributions that are attributable solely to the distributed Tax-Deferred
Contributions, plus any income and minus any losses attributable thereto, shall
be forfeited by the Participant as of the last day of the month in which the
distribution of Tax-Deferred Contributions pursuant to this Section occurs.
7.4 Limitation on Tax-Deferred Contributions of Highly Compensated Employees
Notwithstanding any other provision of the Plan to the contrary, the Tax-
Deferred Contributions made with respect to a Plan Year on behalf of Eligible
Employees who are Highly Compensated Employees may not result in an average
"deferral percentage" for such Eligible Employees that exceeds the greater of:
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(a) a percentage that is equal to 125 percent of the average "deferral
percentage" for all other Eligible Employees for the "testing year"; or
(b) a percentage that is not more than 200 percent of the average "deferral
percentage" for all other Eligible Employees for the "testing year" and
that is not more than two percentage points higher than the average
"deferral percentage" for all other Eligible Employees for the "testing
year",
unless the "excess contributions", determined as provided in Section 7.5, are
distributed as provided in Section 7.6.
In order to assure that the limitation contained herein is not exceeded with
respect to a Plan Year, the Administrator is authorized to suspend completely
further Tax-Deferred Contributions on behalf of Highly Compensated Employees for
any remaining portion of a Plan Year or to adjust the projected "deferral
percentages" of Highly Compensated Employees by reducing the percentage of their
deferral elections for any remaining portion of a Plan Year to such smaller
percentage that will result in the limitation set forth above not being
exceeded. In the event of any such suspension or reduction, Highly Compensated
Employees affected thereby shall be notified of the reduction or suspension as
soon as possible and shall be given an opportunity to make a new deferral
election to be effective the first day of the next following Plan Year. In the
absence of such an election, the election in effect immediately prior to the
suspension or adjustment described above shall be reinstated as of the first day
of the next following Plan Year.
In determining the "deferral percentage" for any Eligible Employee who is a
Highly Compensated Employee for the Plan Year, "elective contributions",
"qualified nonelective contributions", and "qualified matching contributions"
(to the extent that "qualified nonelective contributions" and "qualified
matching contributions" are taken into account in determining "deferral
percentages") made to his accounts under any plan of an Employer or a Related
Company that is not mandatorily disaggregated pursuant to IRS regulations
Section 1.410(b)- 7(c), as modified by Section 1.401(k)-1(g)(11), shall be
treated as if all such contributions were made to the Plan; provided, however,
that if such a plan has a plan year different from the Plan Year, any such
contributions made to the Highly Compensated Employee's accounts under the plan
for the plan year ending with or within the same calendar year as the Plan Year
shall be treated as if such contributions were made to the Plan.
Notwithstanding the foregoing, such contributions shall not be treated as if
they were made to the Plan if regulations issued under Code Section 401(k) do
not permit such plan to be aggregated with the Plan.
If one or more plans of an Employer or Related Company are aggregated with the
Plan for purposes of satisfying the requirements of Code Section 401(a)(4) or
410(b), then "deferral percentages" under the Plan shall be calculated as if the
Plan and such one or more other plans were a single plan. Plans may be
aggregated to satisfy Code Section 401(k) only if they have the same plan year.
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The Administrator shall maintain records sufficient to show that the limitation
contained in this Section was not exceeded with respect to any Plan Year and the
amount of the "qualified nonelective contributions" and/or "qualified matching
contributions" taken into account in determining "deferral percentages" for any
Plan Year.
Notwithstanding anything herein to the contrary, in the event that the
limitations of this Section are exceeded, the Administrator may take any and all
actions which, in its discretion are necessary or appropriate to ensure that the
limitations of this Section are satisfied, including, but not limited to using
"current year" testing in accordance with Code Section 401(k)(3)(A) and the
regulations thereunder.
7.5 Determination and Allocation of Excess Tax-Deferred Contributions Among
Highly Compensated Employees
Notwithstanding any other provision of the Plan to the contrary, in the event
that the limitation on Tax-Deferred Contributions described in Section 7.4 is
exceeded in any Plan Year, the Administrator shall determine the dollar amount
of the excess by reducing the dollar amount of the contributions included in
determining the "deferral percentage" of Highly Compensated Employees in order
of their "deferral percentages" as follows:
(a) The highest "deferral percentage(s)" shall be reduced to the greater of (1)
the maximum "deferral percentage" that satisfies the limitation on Tax-
Deferred Contributions described in Section 7.4 or (2) the next highest
"deferral percentage".
(b) If the limitation on Tax-Deferred Contributions described in Section 7.4
would still be exceeded after application of the provisions of paragraph
(a), the Administrator shall continue reducing "deferral percentages" of
Highly Compensated Employees, continuing with the next highest "deferral
percentage", in the manner provided in paragraph (a) until the limitation
on Tax- Deferred Contributions described in Section 7.4 is satisfied.
The determination of the amount of "excess contributions" hereunder shall be
made after Tax- Deferred Contributions and "excess deferrals" have been
distributed pursuant to Sections 7.2 and 7.3, if applicable.
After determining the dollar amount of the "excess contributions" that have been
made to the Plan, the Administrator shall allocate such excess among Highly
Compensated Employees in order of the dollar amount of the Tax-Deferred,
Qualified Nonelective, and Qualified Matching Contributions (to the extent such
contributions are included in determining "deferral percentages") allocated to
their Accounts as follows:
(c) The contributions made on behalf of the Highly Compensated Employee(s) with
the largest dollar amount of Tax-Deferred and Qualified Matching
Contributions
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allocated to his Account for the Plan Year shall be reduced by the dollar
amount of the excess (with such dollar amount being allocated equally among
all such Highly Compensated Employees), but not below the dollar amount of
such contributions made on behalf of the Highly Compensated Employee(s)
with the next highest dollar amount of such contributions allocated to his
Account for the Plan Year.
(d) If the excess has not been fully allocated after application of the
provisions of paragraph (c), the Administrator shall continue reducing the
permissible contributions made on behalf of Highly Compensated Employees,
continuing with the Highly Compensated Employees with the largest remaining
dollar amount of such contributions allocated to their Accounts for the
Plan Year, in the manner provided in paragraph (c) until the entire excess
determined above has been allocated.
7.6 Distribution of Excess Tax-Deferred Contributions
"Excess contributions" allocated to a Highly Compensated Employee pursuant to
the preceding Section, plus any income and minus any losses attributable
thereto, shall be distributed to the Highly Compensated Employee prior to the
end of the next succeeding Plan Year. If such excess amounts are distributed
more than 21/2 months after the last day of the Plan Year for which the excess
occurred, an excise tax may be imposed under Code Section 4979 on the Employer
maintaining the Plan with respect to such amounts.
Excess amounts shall be distributed from the Highly Compensated Employee's Tax-
Deferred Contributions and Qualified Matching Contributions Sub-Accounts in
proportion to the Tax-Deferred Contributions and Qualified Matching
Contributions included in determining the Highly Compensated Employee's
"deferral percentage" for the Plan Year.
If an amount of Tax-Deferred Contributions is distributed to a Participant in
accordance with this Section, Matching Contributions that are attributable
solely to the distributed Tax-Deferred Contributions, plus any income and minus
any losses attributable thereto, shall be forfeited by the Participant as of the
last day of the month in which the distribution of Tax-Deferred Contributions
pursuant to this Section occurs.
7.7 Limitation on Matching Contributions of Highly Compensated Employees
Notwithstanding any other provision of the Plan to the contrary, the Matching
Contributions made with respect to a Plan Year on behalf of "eligible
participants" who are Highly Compensated Employees may not result in an average
"contribution percentage" for such "eligible participants" that exceeds the
greater of:
(a) a percentage that is equal to 125 percent of the average "contribution
percentage" for all other "eligible participants" for the "testing year";
or
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(b) a percentage that is not more than 200 percent of the average "contribution
percentage" for all other "eligible participants" for the "testing year"
and that is not more than two percentage points higher than the average
"contribution percentage" for all other "eligible participants" for the
"testing year"
unless the "excess contributions", determined as provided in Section 7.8, are
forfeited or distributed as provided in Section 7.9.
In determining the "contribution percentage" for any "eligible participant" who
is a Highly Compensated Employee for the Plan Year, "matching contributions",
"employee contributions", "qualified nonelective contributions", and "elective
contributions" (to the extent that "qualified nonelective contributions" and
"elective contributions" are taken into account in determining "contribution
percentages") made to his accounts under any plan of an Employer or a Related
Company that is not mandatorily disaggregated pursuant to IRS regulations
Section 1.410(b)- 7(c), as modified by IRS regulations Section 1.401(k)-
1(g)(11), shall be treated as if all such contributions were made to the Plan;
provided, however, that if such a plan has a plan year different from the Plan
Year, any such contributions made to the Highly Compensated Employee's accounts
under the plan for the plan year ending with or within the same calendar year as
the Plan Year shall be treated as if such contributions were made to the Plan.
Notwithstanding the foregoing, such contributions shall not be treated as if
they were made to the Plan if regulations issued under Code Section 401(m) do
not permit such plan to be aggregated with the Plan.
If one or more plans of an Employer or a Related Company are aggregated with the
Plan for purposes of satisfying the requirements of Code Section 401(a)(4) or
410(b), the "contribution percentages" under the Plan shall be calculated as if
the Plan and such one or more other plans were a single plan. Plans may be
aggregated to satisfy Code Section 401(m) only if they have the same plan year.
The Administrator shall maintain records sufficient to show that the limitation
contained in this Section was not exceeded with respect to any Plan Year and the
amount of the "elective contributions", "qualified nonelective contributions",
and/or "qualified matching contributions" taken into account in determining
"contribution percentages" for any Plan Year.
Notwithstanding anything herein to the contrary, in the event that the
limitations of this Section are exceeded, the Administrator may take any and all
actions which, in its discretion are necessary or appropriate to ensure that the
limitations of this Section are satisfied, including, but not limited to using
"current year" testing in accordance with Code Section 401(m)(2)(A) and the
regulations thereunder.
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7.8 Determination and Allocation of Excess Matching Contributions Among Highly
Compensated Employees
Notwithstanding any other provision of the Plan to the contrary, in the event
that the limitation on Matching Contributions described in Section 7.7 is
exceeded in any Plan Year, the Administrator shall determine the dollar amount
of the excess by reducing the dollar amount of the contributions included in
determining the "contribution percentage" of Highly Compensated Employees in
order of their "contribution percentages" as follows:
(a) The highest "contribution percentage(s)" shall be reduced to the greater of
(1) the maximum "contribution percentage" that satisfies the limitation on
Matching Contributions described in Section 7.7 or (2) the next highest
"contribution percentage".
(b) If the limitation on Matching Contributions described in Section 7.7 would
still be exceeded after application of the provisions of paragraph (a), the
Administrator shall continue reducing "contribution percentages" of Highly
Compensated Employees, with the next highest "contribution percentage", in
the manner provided in paragraph (a) until the limitation of Matching
Contributions described in Section 7.7 is satisfied.
The determination of the amount of excess Matching Contributions shall be made
after application of Sections 7.2, 7.3, and 7.6, if applicable.
After determining the dollar amount of the "excess contributions" that have been
made to the Plan, the Administrator shall allocate such excess among Highly
Compensated Employees in order of the dollar amount of the Matching and Tax-
Deferred Contributions (to the extent such contributions are included in
determining "contribution percentages") allocated to their Accounts as follows:
(c) The contributions made on behalf of the Highly Compensated Employee(s) with
the largest dollar amount of Matching and Tax-Deferred Contributions
allocated to his Account for the Plan Year shall be reduced by the dollar
amount of the excess (with such dollar amount being allocated equally among
all such Highly Compensated Employees), but not below the dollar amount of
such contributions made on behalf of the Highly Compensated Employee(s)
with the next highest dollar amount of such contributions allocated to his
Account for the Plan Year.
(d) If the excess has not been fully allocated after application of the
provisions of paragraph (c), the Administrator shall continue reducing the
contributions made on behalf of Highly Compensated Employees, continuing
with the Highly Compensated Employees with the largest remaining dollar
amount of such contributions allocated to their Accounts for the Plan Year,
in the manner
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provided in paragraph (c) until the entire excess determined above has been
allocated.
7.9 Forfeiture or Distribution of "Excess Contributions"
"Excess contributions" allocated to a Highly Compensated Employee pursuant to
the preceding Section, plus any income and minus any losses attributable
thereto, shall be forfeited, to the extent forfeitable, or distributed to the
Participant prior to the end of the next succeeding Plan Year as hereinafter
provided. If such excess amounts are distributed more than 2 1/2 months after
the last day of the Plan Year for which the excess occurred, an excise tax may
be imposed under Code Section 4979 on the Employer maintaining the Plan with
respect to such amounts.
The distribution or forfeiture requirement of this Section shall be satisfied by
reducing contributions made by or on behalf of the Highly Compensated Employee
to the extent necessary in the following order:
(a) Matching Contributions included in determining the Highly Compensated
Employee's "contribution percentage" shall be distributed or forfeited, as
appropriate.
(b) Tax-Deferred Contributions included in determining the Highly Compensated
Employee's "contribution percentage" shall be distributed.
Excess Matching Contributions shall be distributed only to the extent a
Participant has a vested interest in his Matching Contributions Sub-Account and
shall otherwise be forfeited. Any amounts forfeited with respect to a
Participant pursuant to this Section shall be treated as a forfeiture under the
Plan as of the last day of the month in which the distribution of contributions
pursuant to this Section occurs.
7.10 Multiple Use Limitation
Notwithstanding any other provision of the Plan to the contrary, the following
multiple use limitation as required under Code Section 401(m) shall apply: the
sum of the average "deferral percentage" for Eligible Employees who are Highly
Compensated Employees and the average "contribution percentage" for "eligible
participants" who are Highly Compensated Employees may not exceed the "aggregate
limit". In the event that, after satisfaction of the limitations provided under
this Article, it is determined that contributions under the Plan fail to satisfy
the multiple use limitation contained herein, the multiple use limitation shall
be satisfied by further reducing the "deferral percentages" of Eligible
Employees who are Highly Compensated Employees to the extent necessary to
eliminate the excess, as provided in the preceding Sections. Instead of reducing
"deferral percentages", the Administrator may determine to satisfy the multiple
use limitation in an alternative manner, consistently applied, that may be
permitted by regulations issued under Code Section 401(m).
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7.11 Treatment of Forfeited Matching Contributions
Any Matching Contributions that are forfeited pursuant to the provisions of the
preceding Sections of this Article shall be treated as a forfeiture under the
Plan and applied in accordance with the provisions of Article XIV.
7.12 Determination of Income or Loss
The income or loss attributable to "excess contributions" that are distributed
pursuant to this Article shall be determined for the preceding Plan Year under
the method otherwise used for allocating income or loss to Participant's
Accounts.
7.13 Code Section 415 Limitations on Crediting of Contributions and Forfeitures
Notwithstanding any other provision of the Plan to the contrary, the "annual
addition" with respect to a Participant for a "limitation year" shall in no
event exceed the lesser of (i) $30,000 (adjusted as provided in Code Section
415(d)) or (ii) 25 percent of the Participant's compensation, as defined in Code
Section 415(c)(3) and regulations issued thereunder, for the "limitation year";
provided, however, that the limit in clause (i) shall be pro-rated for any short
"limitation year" as may be required under Code Section 415(c). If the "annual
addition" to the Account of a Participant in any "limitation year" would
otherwise exceed the amount that may be applied for his benefit under the
limitation contained in this Section, the limitation shall be satisfied by
reducing contributions made to the Participant's Account to the extent necessary
in the following order:
Tax-Deferred Contributions made on behalf of the Participant for the
"limitation year" that have not been matched, if any, shall be reduced.
Tax-Deferred Contributions made on behalf of the Participant for the
"limitation year" that have been matched, if any, and the Matching
Contributions attributable thereto shall be reduced pro rata.
Employer Contributions, other than Matching Contributions, otherwise
allocable to the Participant's Account for the "limitation year", if any,
shall be reduced.
The amount of any reduction of Tax-Deferred Contributions (plus any income
attributable thereto) shall be returned to the Participant. The amount of any
reduction of Employer Contributions shall be deemed a forfeiture for the
"limitation year".
Amounts deemed to be forfeitures under this Section shall be held unallocated in
a suspense account established for the "limitation year" and shall be applied
against the Employer's contribution obligation for the next following
"limitation year" (and succeeding "limitation years", as necessary). If a
suspense account is in existence at any
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time during a "limitation year", all amounts in the suspense account must be
applied against the Employer's contribution obligation before any further
contributions that would constitute "annual additions" may be made to the Plan.
No suspense account established hereunder shall share in any increase or
decrease in the net worth of the Trust.
For purposes of this Article, excesses shall result only from the allocation of
forfeitures, a reasonable error in estimating a Participant's annual
compensation (as defined in Code Section 415(c)(3) and regulations issued
thereunder), a reasonable error in determining the amount of "elective
contributions" that may be made with respect to any Participant under the limits
of Code Section 415, or other limited facts and circumstances that justify the
availability of the provisions set forth above.
7.14 Application of Code Section 415 Limitations Where Participant is Covered
Under Other Qualified Defined Contribution Plan
If a Participant is covered by any other qualified defined contribution plan
(whether or not terminated) maintained by an Employer or a Related Company
concurrently with the Plan, and if the "annual addition" for the "limitation
year" would otherwise exceed the amount that may be applied for the
Participant's benefit under the limitation contained in the preceding Section,
such excess shall be reduced first by returning "employee contributions" made by
the Participant to all defined contribution plans for the "limitation year", and
the income attributable thereto, to the extent necessary in the order prescribed
by the Administrator. If the limitation contained in the preceding Section
still is not satisfied after all such "employee contributions" have been
returned, the excess shall be reduced by returning or forfeiting, as provided in
each defined contribution plan, "elective contributions" made on the
Participant's behalf to all such plans for the "limitation year", and, if
"elective contributions" are returned, the income attributable thereto, to the
extent necessary in the order prescribed by the Administrator. If the
limitation contained in the preceding Section still is not satisfied after all
such "elective contributions" have been returned or forfeited, the portion of
the employer contributions and of forfeitures for the "limitation year" under
all such plans that has been allocated to the Participant under such plans but
which exceeds the limitation set forth in the preceding Section, shall be deemed
a forfeiture for the "limitation year" and shall be disposed of as provided in
such plans; provided, however, that the amount of the employer contributions and
forfeitures that is a deemed forfeiture under this Section shall be effected in
the order prescribed by the Administrator, but first under any defined
contribution plan that is not a money purchase pension plan and, if the
limitation still is not satisfied, then under such money purchase pension plan.
7.15 Scope of Limitations
The Code Section 415 limitations contained in the preceding Sections shall be
applicable only with respect to benefits provided pursuant to defined
contribution plans and defined benefit plans described in Code Section 415(k).
For purposes of applying the Code
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Section 415 limitations contained in the preceding Sections, the term "Related
Company" shall be adjusted as provided in Code Section 415(h).
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ARTICLE VIII
TRUST FUNDS AND ACCOUNTS
8.1 General Fund
The Trustee shall maintain a General Fund as required to hold and administer any
assets of the Trust that are not allocated among the Investment Funds as
provided in the Plan or the Trust Agreement. The General Fund shall be held and
administered as a separate common trust fund. The interest of each Participant
or Beneficiary under the Plan in the General Fund shall be an undivided
interest.
8.2 Investment Funds
The Sponsor shall determine the number and type of Investment Funds and shall
communicate the same and any changes therein in writing to the Administrator and
the Trustee. Each Investment Fund shall be held and administered as a separate
common trust fund. The interest of each Participant or Beneficiary under the
Plan in any Investment Fund shall be an undivided interest.
The Sponsor may determine to offer one or more Investment Funds that are
invested in whole or in part in equity securities issued by an Employer or a
Related Company that are "qualifying employer securities" as defined in ERISA
Section 407(d)(5). In no event may a Participant's Tax-Deferred Contributions
made for any Plan Year beginning on or after January 1, 1999 in excess of one
percent of the Participant's Compensation for such Plan Year be required to be
invested in such equity securities.
8.3 Loan Investment Fund
If a loan from the Plan to a Participant is approved in accordance with the
provisions of Article XII, the Sponsor shall direct the establishment and
maintenance of a loan Investment Fund in the Participant's name. The assets of
the loan Investment Fund shall be held and administered as a separate trust
fund. A Participant's loan Investment Fund shall be invested in the note
reflecting the loan that is executed by the Participant in accordance with the
provisions of Article XII. Notwithstanding any other provision of the Plan to
the contrary, income received with respect to a Participant's loan Investment
Fund shall be allocated and the loan Investment Fund shall be administered as
provided in Article XII.
8.4 Income on Trust
Any dividends, interest, distributions, or other income received by the Trustee
with respect to any separate portion of the Trust maintained hereunder shall be
allocated by the Trustee to the portion of the Trust for which the income was
received.
8.5 Participant Accounts
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As of the first date a contribution is made by or on behalf of an Employee there
shall be established an Account in his name reflecting his interest in the
Trust. Each Account shall be maintained and administered for each Participant
and Beneficiary in accordance with the provisions of the Plan. The balance of
each Account shall be the balance of the account after all credits and charges
thereto, for and as of such date, have been made as provided herein.
8.6 Sub-Accounts
A Participant's Account shall be divided into such separate, individual Sub-
Accounts as are necessary or appropriate to reflect the Participant's interest
in the Trust.
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ARTICLE IX
LIFE INSURANCE CONTRACTS
9.1 No Life Insurance Contracts
A Participant's Account may not be invested in life insurance contracts on the
life of the Participant.
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ARTICLE X
DEPOSIT AND INVESTMENT OF CONTRIBUTIONS
10.1 Future Contribution Investment Elections
Each Eligible Employee shall make an investment election in the manner and form
prescribed by the Administrator directing the manner in which the contributions
made on his behalf shall be invested. An Eligible Employee's investment
election shall specify the percentage, in the percentage increments prescribed
by the Administrator, of such contributions that shall be allocated to one or
more of the Investment Funds with the sum of such percentages equaling 100
percent. The investment election by a Participant shall remain in effect until
his entire interest under the Plan is distributed or forfeited in accordance
with the provisions of the Plan or until he files a change of investment
election with the Administrator, in such form as the Administrator shall
prescribe. If filed in accordance with any rules prescribed by the
Administrator, a Participant's change of investment election may be made
effective as of the date or dates prescribed by the Administrator.
10.2 Deposit of Contributions
All contributions made on a Participant's behalf shall be deposited in the Trust
and allocated among the Investment Funds in accordance with the Participant's
currently effective investment election. If no investment election is on file
with the Administrator at the time contributions are to be deposited to a
Participant's Account, his contributions shall be allocated among the Investment
Funds as directed by the Administrator.
10.3 Election to Transfer Between Funds
A Participant may elect to transfer investments from any Investment Fund to any
other Investment Fund. The Participant's transfer election shall specify a
percentage, in the percentage increments prescribed by the Administrator, of the
amount eligible for transfer, which percentage may not exceed 100 percent. Any
transfer election must be filed with the Administrator, in such form as the
Administrator shall prescribe. Subject to any restrictions pertaining to a
particular Investment Fund, if filed in accordance with any rules prescribed by
the Administrator, a Participant's transfer election may be effective as of the
date or dates prescribed by the Administrator.
10.4 404(c) Protection
The Plan is intended to constitute a plan described in ERISA Section 404(c) and
regulations issued thereunder. The fiduciaries of the Plan may be relieved of
liability for any losses that are the direct and necessary result of investment
instructions given by a Participant, his Beneficiary, or an alternate payee
under a qualified domestic relations order.
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ARTICLE XI
CREDITING AND VALUING ACCOUNTS
11.1 Crediting Accounts
All contributions made under the provisions of the Plan shall be credited to
Accounts in the Trust by the Trustee, in accordance with procedures established
in writing by the Administrator, either when received or on the succeeding
Valuation Date after valuation of the Trust has been completed for such
Valuation Date as provided in Section 11.2, as shall be determined by the
Administrator.
11.2 Valuing Accounts
Accounts in the Trust shall be valued by the Trustee on the Valuation Date, in
accordance with procedures established in writing by the Administrator, either
in the manner adopted by the Trustee and approved by the Administrator or in the
manner set forth in Section 11.3 as Plan valuation procedures, as determined by
the Administrator.
11.3 Plan Valuation Procedures
With respect to the Trust, the Administrator may determine that the following
valuation procedures shall be applied. As of each Valuation Date hereunder, the
portion of any Accounts under the Trust shall be adjusted to reflect any
increase or decrease in the value of the Trust for the period of time occurring
since the immediately preceding Valuation Date for the Trust (the "valuation
period") in the following manner:
(a) First, the value of the Trust shall be determined by valuing all of the
assets of the Trust Fund at fair market value.
(b) Next, the net increase or decrease in the value of the Trust attributable
to net income and all profits and losses, realized and unrealized, during
the valuation period shall be determined on the basis of the valuation
under paragraph (a) taking into account appropriate adjustments for
contributions, loan payments, and transfers to and distributions,
withdrawals, loans, and transfers from such Trust during the valuation
period.
(c) Finally, the net increase or decrease in the value of the Trust shall be
allocated among Accounts in the Trust in the ratio of the balance of the
portion of such Account in the Trust as of the preceding Valuation Date
less any distributions, withdrawals, loans, and transfers from such Account
balance in the Trust since the Valuation Date to the aggregate balances of
the portions of all Accounts in the Trust similarly adjusted, and each
Account in the Trust shall be credited or charged with the amount of its
allocated share.
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Notwithstanding the foregoing, the Administrator may adopt such accounting
procedures as it considers appropriate and equitable to establish a
proportionate crediting of net increase or decrease in the value of the Trust
for contributions, loan payments, and transfers to and distributions,
withdrawals, loans, and transfers from such Trust made by or on behalf of a
Participant during the valuation period.
11.4 Finality of Determinations
The Trustee shall have exclusive responsibility for determining the balance of
each Account maintained hereunder. The Trustee's determinations thereof shall
be conclusive upon all interested parties.
11.5 Notification
Within a reasonable period of time after the end of each Plan Year, the
Administrator shall notify each Participant and Beneficiary of the balances of
his Account and Sub-Accounts as of a Valuation Date during the Plan Year.
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ARTICLE XII
LOANS
12.1 Application for Loan
A Participant who is a party in interest as defined in ERISA Section 3(14) may
make application to the Administrator for a loan from his Account. Loans shall
be made to Participants in accordance with written guidelines which are hereby
incorporated into and made a part of the Plan. A loan shall not be made
hereunder unless the Participant applying for the loan has incurred an immediate
and heavy financial need as defined in Article XIII.
As collateral for any loan granted hereunder, the Participant shall grant to the
Plan a security interest in his vested interest under the Plan equal to the
amount of the loan; provided, however, that in no event may the security
interest exceed 50 percent of the Participant's vested interest under the Plan
determined as of the date as of which the loan is originated in accordance with
Plan provisions. The Participant also shall enter into an agreement to repay the
loan by payroll withholding. No loan in excess of 50 percent of the
Participant's vested interest under the Plan shall be made from the Plan. Loans
shall not be made available to Highly Compensated Employees in an amount greater
than the amount made available to other employees.
A loan shall not be granted unless the Participant consents to the charging of
his Account for unpaid principal and interest amounts in the event the loan is
declared to be in default. If a Participant's Account is subject to the
"automatic annuity" provisions under Addendum A, the Participant's spouse must
consent in writing to any loan hereunder. Any spousal consent given pursuant to
this Section must be made within the 90-day period ending on the date the Plan
acquires a security interest in the Participant's Account, must acknowledge the
effect of the loan, and must be witnessed by a Plan representative or a notary
public. Such spousal consent shall be binding with respect to the consenting
spouse and any subsequent spouse with respect to the loan. A new spousal
consent shall be required if the Participant's Account is used for security in
any renegotiation, extension, renewal, or other revision of the loan.
12.2 Reduction of Account Upon Distribution
Notwithstanding any other provision of the Plan, the amount of a Participant's
Account that is distributable to the Participant or his Beneficiary under
Article XIII or XV shall be reduced by the portion of his vested interest that
is held by the Plan as security for any loan outstanding to the Participant,
provided that the reduction is used to repay the loan. If distribution is made
because of the Participant's death prior to the commencement of distribution of
his Account and the Participant's vested interest in his Account is payable to
more than one individual as Beneficiary, then the balance of the Participant's
vested interest in his Account shall be adjusted by reducing the vested account
balance by the
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amount of the security used to repay the loan, as provided in the preceding
sentence, prior to determining the amount of the benefit payable to each such
individual.
12.3 Requirements to Prevent a Taxable Distribution
Notwithstanding any other provision of the Plan to the contrary, the following
terms and conditions shall apply to any loan made to a Participant under this
Article:
(a) The interest rate on any loan to a Participant shall be a reasonable
interest rate commensurate with current interest rates charged for loans
made under similar circumstances by persons in the business of lending
money.
(b) The amount of any loan to a Participant (when added to the outstanding
balance of all other loans to the Participant from the Plan or any other
plan maintained by an Employer or a Related Company) shall not exceed the
lesser of:
(i) $50,000, reduced by the excess, if any, of the highest outstanding
balance of any other loan to the Participant from the Plan or any
other plan maintained by an Employer or a Related Company during the
preceding 12-month period over the outstanding balance of such loans
on the date a loan is made hereunder; or
(ii) 50 percent of the vested portions of the Participant's Account and his
vested interest under all other plans maintained by an Employer or a
Related Company.
(c) The term of any loan to a Participant shall be no greater than five years,
except in the case of a loan used to acquire 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.
(d) Except as otherwise permitted under Treasury regulations, substantially
level amortization shall be required over the term of the loan with
payments made not less frequently than quarterly, except that the
amortization schedule may be waived while a Participant is on a leave of
absence from employment with an Employer or any Related Company for up to
one year, provided that all of the following requirements are met:
(i) Such leave is either without pay or at a reduced rate of pay that,
after withholding for employment and income taxes, is less than the
amount required to be paid under the amortization schedule;
(ii) Payments resume after the earlier of (a) the date such leave of
absence ends or (b) the one-year anniversary of the date such leave
began;
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(iii) The period during which payments are suspended does not exceed one
year;
(iv) Payments resume in an amount not less than the amount required under
the original amortization schedule; and
(v) The waiver of the amortization schedule does not extend the period of
the loan beyond the maximum period permitted under this Article.
12.4 Administration of Loan Investment Fund
Upon approval of a loan to a Participant, the Administrator shall direct the
Trustee to transfer an amount equal to the loan amount from the Investment Funds
in which it is invested, as directed by the Administrator, to the loan
Investment Fund established in the Participant's name. Any loan approved by the
Administrator shall be made to the Participant out of the Participant's loan
Investment Fund. All principal and interest paid by the Participant on a loan
made under this Article shall be deposited to his Account and shall be allocated
upon receipt among the Investment Funds in accordance with the Participant's
currently effective investment election. The balance of the Participant's loan
Investment Fund shall be decreased by the amount of principal payments and the
loan Investment Fund shall be terminated when the loan has been repaid in full.
12.5 Default
If a Participant fails to make or cause to be made, any payment required under
the terms of the loan within 90 days following the date on which such payment
shall become due, unless payment is not made because the Participant is on a
leave of absence and the amortization schedule is waived as provided in Section
12.3(d), or there is an outstanding principal balance existing on a loan after
the last scheduled repayment date, the Administrator shall direct the Trustee to
declare the loan to be in default, and the entire unpaid balance of such loan,
together with accrued interest, shall be immediately due and payable. In any
such event, if such balance and interest thereon is not then paid, the Trustee
shall charge the Account of the borrower with the amount of such balance and
interest as of the earliest date a distribution may be made from the Plan to the
borrower without adversely affecting the tax qualification of the Plan or of the
cash or deferred arrangement.
12.6 Deemed Distribution Under Code Section 72(p)
If a Participant's loan is in default as provided in Section 12.5, the
Participant shall be deemed to have received a taxable distribution in the
amount of the outstanding loan balance as required under Code Section 72(p),
whether or not distribution may actually be made from the Plan without adversely
affecting the tax qualification of the Plan; provided, however, that the taxable
portion of such deemed distribution shall be reduced in accordance with the
provisions of Code Section 72(e) to the extent the deemed
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distribution is attributable to the Participant's After-Tax Contributions. The
amount of any loan that is deemed to have been distributed to a Participant
hereunder shall cease to be an outstanding loan for purposes of Code Section
72(p) and a Participant shall not be treated as having received a taxable
distribution when his Account is offset by such outstanding loan balance as
provided in Section 12.5. Any interest that accrues on a loan after it is deemed
to have been distributed shall not be treated as an additional loan to the
Participant and shall not be included in the Participant's taxable income as a
deemed distribution. Notwithstanding the foregoing, however, unless a
Participant repays such loan, with interest, the amount of such loan, with
interest thereon calculated as provided in the original loan note, shall
continue to be considered an outstanding loan for purposes of determining the
maximum permissible amount of any subsequent loan under Section 12.3(b).
If a Participant elects to repay a loan after it is deemed to have been
distributed hereunder, such repayment shall be treated as an After-Tax
Contribution to the Plan solely for purposes of determining the taxable portion
of the Participant's Account and shall not be treated as an After-Tax
Contribution for any other Plan purpose, including application of the
limitations on contributions applicable under Code Sections 401(m) and 415.
12.7 Special Rules Applicable to Loans
Any loan made hereunder shall be subject to the following rules and any such
other rules as the Administrator may establish in accordance with any written
loan guidelines:
(a) Minimum Loan Amount: A Participant may not request a loan for less than
$500.
(b) Maximum Number of Outstanding Loans: A Participant with an outstanding
loan may not apply for another loan until the existing loan is paid in full
and may not refinance an existing loan or attain a second loan for the
purpose of paying off the existing loan.
(c) Maximum Period for Principal Residence Loan: The term of any loan to a
Participant that is used to acquire 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 shall be no greater than
15 years.
(d) Pre-Payment Without Penalty: A Participant may pre-pay the balance of any
loan hereunder prior to the date it is due without penalty.
12.8 Loans Granted Prior to Merger
Notwithstanding any other provision of this Article to the contrary, any loan
made under the provisions of a Plan as in effect prior to its merger into this
Plan shall remain outstanding until repaid in accordance with its terms or the
otherwise applicable plan provisions.
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ARTICLE XIII
WITHDRAWALS WHILE EMPLOYED
13.1 Non-Hardship, In-Service Withdrawals of Prior After-Tax and Prior Profit-
Sharing Contributions
A Participant who is employed by an Employer or a Related Company may elect,
subject to the limitations and conditions prescribed in this Article, solely
with respect to his Merged Accounts, and only as permitted in Addendum B, to
make an in-service cash withdrawal (subject to the "automatic annuity"
provisions of Addendum A, if applicable), from his Prior After-Tax Contributions
or Prior Profit-Sharing Contributions Sub-Account.
13.2 Non-Hardship, In-Service Withdrawals of Rollover Contributions Attributable
to Merged Plans
A Participant who is employed by an Employer or a Related Company may elect,
subject to the limitations and conditions prescribed in this Article, solely
with respect to his Merged Accounts, and only as permitted in Addendum B, to
make an in-service cash withdrawal (subject to the "automatic annuity"
provisions of Addendum A, if applicable), from his Rollover Contributions Sub-
Account.
13.3 Age 59 1/2 Withdrawals of Tax-Deferred Contributions Attributable to Merged
Plans
A Participant who is employed by an Employer or a Related Company and who has
attained age 59 1/2 may elect, subject to the limitations and conditions
prescribed in this Article, solely with respect to his Merged Accounts, and only
as permitted in Addendum B, to make an in-service cash withdrawal (subject to
the "automatic annuity" provisions of Addendum A, if applicable), from his
vested interest in his Tax-Deferred Contributions Sub-Account.
13.4 Overall Limitations on Non-Hardship Withdrawals
Non-hardship withdrawals made pursuant to this Article shall be subject to the
following conditions and limitations:
(a) A Participant must apply for a non-hardship withdrawal such number of days
prior to the date as of which it is to be effective as the Administrator
may prescribe.
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(b) Withdrawals may be made effective as of the date or dates prescribed by the
Administrator.
(c) If the portion of a Participant's Account to be withdrawn is subject to the
"automatic annuity" provisions of Addendum A, the Participant's spouse must
consent to any withdrawal hereunder, unless the withdrawal is made in the
form of a Qualified Joint and Survivor Annuity.
13.5 Hardship Withdrawals
A Participant who is employed by an Employer or a Related Company and who is
determined by the Administrator to have incurred a hardship in accordance with
the provisions of this Article may elect, subject to the limitations and
conditions prescribed in this Article, to make a cash withdrawal from his vested
interest in any of his Sub-Accounts; provided however, that income credited
after December 31, 1988 with respect to a Participant's Tax-Deferred
Contributions, or amounts that are treated as Tax-Deferred Contributions for
purposes of the actual deferral percentage test described in Article VII.
13.6 Hardship Determination
The Administrator shall grant a hardship withdrawal only if it determines that
the withdrawal is necessary to meet an immediate and heavy financial need of the
Participant. An immediate and heavy financial need of the Participant means a
financial need on account of:
(c) expenses previously incurred by or necessary to obtain for the Participant,
the Participant's spouse, or any dependent of the Participant (as defined
in Section 152 of the Code) medical care described in Section 213(d) of the
Code;
(d) costs directly related to the purchase (excluding mortgage payments) of a
principal residence for the Participant;
(e) payment of tuition, related educational fees, and room and board expenses
for the next 12 months of post-secondary education for the Participant, the
Participant's spouse, or any dependent of the Participant; or
(f) the need to prevent the eviction of the Participant from his principal
residence or foreclosure on the mortgage of the Participant's principal
residence.
13.7 Satisfaction of Necessity Requirement for Hardship Withdrawals
A withdrawal from a Participant's Tax-Deferred Sub-Account shall be deemed to be
necessary to satisfy an immediate and heavy financial need of a Participant only
if the Participant satisfies all of the following requirements:
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(a) The withdrawal is not in excess of the amount of the immediate and heavy
financial need of the Participant.
(b) The Participant has obtained all distributions, other than hardship
distributions, and all non-taxable loans currently available under all
plans maintained by an Employer or any Related Company.
(c) The Participant's Tax-Deferred Contributions and the Participant's elective
tax-deferred contributions and employee after-tax contributions under all
other qualified and non-qualified deferred compensation plans maintained by
an Employer or any Related Company shall be suspended for at least twelve
months after his receipt of the withdrawal.
(d) The Participant's Tax-Deferred Contributions and "elective contributions",
as defined in Article VII, for his taxable year immediately following the
taxable year of the withdrawal shall not exceed the applicable limit under
Code Section 402(g) for such next taxable year less the amount of the
Participant's Tax-Deferred Contributions and "elective contributions" for
the taxable year of the withdrawal.
A Participant shall not fail to be treated as an Eligible Employee for purposes
of applying the limitations contained in Article VII of the Plan merely because
his Tax-Deferred Contributions are suspended in accordance with this Section.
13.8 Conditions and Limitations on Hardship Withdrawals
Hardship withdrawals made pursuant to this Article shall be subject to the
following conditions and limitations:
(a) A Participant must apply for a hardship withdrawal such number of days
prior to the date as of which it is to be effective as the Administrator
may prescribe.
(b) Hardship withdrawals may be made effective as of the date or dates
prescribed by the Administrator.
(c) The amount of a hardship withdrawal may include any amounts necessary to
pay any Federal, state, or local income taxes or penalties reasonably
anticipated to result from the distribution.
(d) If a Participant's Account is subject to the "automatic annuity" provisions
of the Addendum, the Participant's spouse must consent to any withdrawal
hereunder, unless the withdrawal is made in the form of a Qualified Joint
and Survivor Annuity.
13.9 Order of Withdrawal from a Participant's Sub-Accounts
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Distribution of a withdrawal amount shall be made from a Participant's Sub-
Accounts, to the extent necessary, in the order prescribed by the Administrator,
which order shall be uniform with respect to all Participants and non-
discriminatory. If the Sub-Account from which a Participant is receiving a
withdrawal is invested in more than one Investment Fund, the withdrawal shall be
charged against the Investment Funds on a pro-rata basis as directed by the
Administrator.
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ARTICLE XIV
TERMINATION OF EMPLOYMENT AND SETTLEMENT DATE
14.1 Termination of Employment and Settlement Date
A Participant's Settlement Date shall occur on the date he terminates employment
with the Employers and all Related Companies because of death, disability,
retirement, or other termination of employment. Notice of a Participant's
Settlement Date shall be given by the Administrator to the Trustee.
14.2 Disposition of Non-Vested Amounts
That portion of a Participant's Employer Contributions Sub-Account that is not
vested upon the occurrence of his Settlement Date shall be disposed of as
follows:
(a) If the Participant has no vested interest in his Account upon the
occurrence of his Settlement Date or his vested interest in his Account as
of the date of distribution does not exceed $5,000 resulting in the
distribution or deemed distribution to the Participant of his entire vested
interest in his Account, the non-vested balance remaining in the
Participant's Employer Contributions Sub-Account shall be immediately
forfeited and his Account closed following (i) the Participant's Settlement
Date, if the Participant has no vested interest in his Account and is
therefore deemed to have received distribution on that date, or (ii) the
date actual distribution is made to the Participant.
(b) If the Participant's vested interest in his Account exceeds $5,000 and the
Participant is eligible for and consents in writing to a single sum payment
of his vested interest in his Account, the non-vested balance remaining in
the Participant's Employer Contributions Sub-Account shall be immediately
forfeited and his Account closed following his receipt of the single sum
payment, provided that such distribution is made because of the
Participant's Settlement Date. A distribution is deemed to be made because
of a Participant's Settlement Date if it occurs prior to the end of the
second Plan Year beginning on or after the Participant's Settlement Date.
14.3 Treatment of Forfeited Amounts
Whenever the non-vested balance of a Participant's Employer Contributions Sub-
Account is forfeited during a Plan Year in accordance with the provisions of the
preceding Section, the amount of such forfeiture, determined as of the last day
of the Plan Year in which the forfeiture occurs, shall be applied against Plan
expenses for such Plan Year or against the Employer Contribution obligations for
the Plan Year of the Employer for which the Participant last performed services
as an Employee. Notwithstanding the foregoing, however, should the amount of
all such forfeitures for any Plan Year with respect to any Employer exceed the
amount of such Employer's Employer Contribution
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obligation for the Plan Year, the excess amount of such forfeitures shall be
held unallocated in a suspense account established with respect to the Employer
and shall be applied against Plan expenses and the Employer's Employer
Contribution obligations for the following Plan Year.
14.4 Recrediting of Forfeited Amounts
A former Participant who forfeited the non-vested portion of his Employer
Contributions Sub-Account in accordance with the provisions of paragraph (a) or
(b) of Section 14.2 and who is re-employed by an Employer or a Related Company
shall have such forfeited amounts recredited to a new Account in his name,
without adjustment for interim gains or losses experienced by the Trust, if he
returns to employment with an Employer or a Related Company before he incurs
five consecutive Breaks in Service commencing after the date he received, or is
deemed to have received, distribution of his vested interest in his Account.
Funds needed in any Plan Year to recredit the Account of a Participant with the
amounts of prior forfeitures in accordance with the preceding sentence shall
come first from forfeitures that arise during such Plan Year, and then from
Trust income earned in such Plan Year, with each Trust Fund being charged with
the amount of such income proportionately, unless his Employer chooses to make
an additional Employer Contribution, and shall finally be provided by his
Employer by way of a separate Employer Contribution.
A former Participant who was a partially vested participant in a Merged Plan and
who received an actual distribution of his entire vested account and who returns
to employment within the time period described above may elect to repay to the
Plan the full amount of such distribution that is attributable to Employer
Contributions before the earlier of (i) the end of the five-year period
beginning on the date he is re-employed or (ii) the date he incurs five
consecutive Breaks in Service commencing after the date he received, or is
deemed to have received, distribution of his vested interest in his Account.
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ARTICLE XV
DISTRIBUTIONS
15.1 Distributions to Participants
A Participant whose Settlement Date occurs shall receive distribution of his
vested interest in his Account in the form provided under Article XVI beginning
as soon as reasonably practicable following his Settlement Date or the date his
application for distribution is filed with the Administrator, if later.
15.2 Distributions to Beneficiaries
If a Participant dies prior to his Benefit Payment Date, his Beneficiary shall
receive distribution of the Participant's vested interest in his Account in the
form provided under Article XVI beginning as soon as reasonably practicable
following the date the Beneficiary's application for distribution is filed with
the Administrator. Unless distribution is to be made over the life or over a
period certain not greater than the life expectancy of the Beneficiary,
distribution of the Participant's entire vested interest shall be made to the
Beneficiary no later than the end of the fifth calendar year beginning after the
Participant's death. If distribution is to be made over the life or over a
period certain no greater than the life expectancy of the Beneficiary,
distribution shall commence no later than:
(a) If the Beneficiary is not the Participant's spouse, the end of the first
calendar year beginning after the Participant's death; or
(b) If the Beneficiary is the Participant's spouse, the later of (i) the end of
the first calendar year beginning after the Participant's death or (ii) the
end of the calendar year in which the Participant would have attained age
70 1/2.
If distribution is to be made to a Participant's spouse, it shall be made
available within a reasonable period of time after the Participant's death that
is no less favorable than the period of time applicable to other distributions.
If a Participant dies after the date distribution of his vested interest in his
Account begins under this Article, but before his entire vested interest in his
Account is distributed, his Beneficiary shall receive distribution of the
remainder of the Participant's vested interest in his Account beginning as soon
as reasonably practicable following the Participant's date of death in a form
that provides for distribution at least as rapidly as under the form in which
the Participant was receiving distribution.
15.3 Cash Outs and Participant Consent
Notwithstanding any other provision of the Plan to the contrary, if a
Participant's vested interest in his Account does not exceed $5,000,
distribution of such vested interest shall be made to the Participant in a
single sum payment as soon as reasonably practicable
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following his Settlement Date. If a Participant has no vested interest in his
Account on his Settlement Date, he shall be deemed to have received distribution
of such vested interest as of his Settlement Date.
If a Participant's vested interest in his Account exceeds $5,000, distribution
shall not commence to such Participant prior to the date he attains age 62 (or
normal retirement age, if later) without the Participant's written consent and,
if the Participant is married and his Account is subject to the Qualified Joint
and Survivor Annuity requirements specified in Addendum A, the written consent
of his spouse. Notwithstanding the foregoing, spousal consent shall not be
required if distribution is made through the purchase of a Qualified Joint and
Survivor Annuity or the spouse cannot be located or spousal consent cannot be
obtained for other reasons set forth in Code Section 401(a)(11) and regulations
issued thereunder.
If a Participant's Account is subject to the "automatic annuity" provisions of
Addendum A, the Participant's vested interest in his Account shall be deemed to
exceed $5,000 if the Participant's Benefit Payment Date has occurred with
respect to amounts currently held in his Account and as of such Benefit Payment
Date his vested interest in his Account exceeded $5,000.
15.4 Required Commencement of Distribution
Notwithstanding any other provision of the Plan to the contrary, distribution of
a Participant's vested interest in his Account shall commence to the Participant
no later than the earlier of:
(a) unless the Participant elects a later date, 60 days after the close of the
Plan Year in which (i) the Participant's Normal Retirement Date occurs,
(ii) the tenth anniversary of the year in which he commenced participation
in the Plan occurs, or (iii) his Settlement Date occurs, whichever is
latest; or
(b) his Required Beginning Date.
Distributions required to commence under this Section shall be made in the form
provided under Article XVI and in accordance with Code Section 401(a)(9) and
regulations issued thereunder, including the minimum distribution incidental
benefit requirements.
15.5 Re-Employment of a Participant
If a Participant whose Settlement Date has occurred is re-employed by an
Employer or a Related Company, his right to any distribution or further
distributions from the Trust arising from his prior Settlement Date shall be
suspended, and his interest in the Trust shall thereafter be treated in the same
manner as that of any other Participant whose Settlement Date has not occurred.
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15.6 Restrictions on Alienation
Except as provided in Code Section 401(a)(13) (relating to qualified domestic
relations orders), Code Section 401(a)(13)(C) and (D) (relating to offsets
ordered or required under a criminal conviction involving the Plan, a civil
judgement in connection with a violation or alleged violation of fiduciary
responsibilities under ERISA, or a settlement agreement between the Participant
and the Department of Labor in connection with a violation or alleged violation
of fiduciary responsibilities under ERISA), Section 1.401(a)-13(b)(2) of
Treasury regulations (relating to Federal tax levies and judgments), or as
otherwise required by law, no benefit under the Plan at any time shall be
subject in any manner to anticipation, alienation, assignment (either at law or
in equity), encumbrance, garnishment, levy, execution, or other legal or
equitable process; and no person shall have power in any manner to anticipate,
transfer, assign (either at law or in equity), alienate or subject to
attachment, garnishment, levy, execution, or other legal or equitable process,
or in any way encumber his benefits under the Plan, or any part thereof, and any
attempt to do so shall be void.
15.7 Facility of Payment
If the Administrator finds that any individual to whom an amount is payable
hereunder is incapable of attending to his financial affairs because of any
mental or physical condition, including the infirmities of advanced age, such
amount (unless prior claim therefore shall have been made by a duly qualified
guardian or other legal representative) may, in the discretion of the
Administrator, be paid to another person for the use or benefit of the
individual found incapable of attending to his financial affairs or in
satisfaction of legal obligations incurred by or on behalf of such individual.
The Trustee shall make such payment only upon receipt of written instructions to
such effect from the Administrator. Any such payment shall be charged to the
Account from which any such payment would otherwise have been paid to the
individual found incapable of attending to his financial affairs and shall be a
complete discharge of any liability therefor under the Plan.
15.8 Inability to Locate Payee
If any benefit becomes payable to any person, or to the executor or
administrator of any deceased person, and if that person or his executor or
administrator does not present himself to the Administrator within a reasonable
period after the Administrator mails written notice of his eligibility to
receive a distribution hereunder to his last known address and makes such other
diligent effort to locate the person as the Administrator determines, that
benefit will be forfeited. However, if the payee later files a claim for that
benefit, the benefit will be restored.
15.9 Distribution Pursuant to Qualified Domestic Relations Orders
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Notwithstanding any other provision of the Plan to the contrary, if a qualified
domestic relations order so provides, distribution may be made to an alternate
payee pursuant to a qualified domestic relations order, as defined in Code
Section 414(p), regardless of whether the Participant's Settlement Date has
occurred or whether the Participant is otherwise entitled to receive a
distribution under the Plan.
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ARTICLE XVI
FORM OF PAYMENT
16.1 Applicability
Subject to the provisions of Addenda A and B regarding grandfathered forms of
payment, the provisions of this Article shall apply to all Participants and
Beneficiaries eligible to receive a distribution under the Plan.
16.2 Normal Form of Payment
Distributions shall be made to the Participant, or, in the case of his death, to
his Beneficiary, in a single sum payment.
16.3 Optional Forms of Payment
The optional forms of payment described on Addenda A and B are available only
with respect to Merged Plan Accounts.
16.4 Change of Election
A Participant or Beneficiary who has elected an optional form of payment may
revoke or change his election at any time prior to his Benefit Payment Date by
filing his election with the Administrator in the form prescribed by the
Administrator.
16.5 Direct Rollover
Notwithstanding any other provision of the Plan to the contrary, in lieu of
receiving distribution in the form of payment provided under this Article, a
"qualified distributee" may elect in writing, in accordance with rules
prescribed by the Administrator, to have a portion or all of any "eligible
rollover distribution" paid directly by the Plan to the "eligible retirement
plan" designated by the "qualified distributee". Any such payment by the Plan
to another "eligible retirement plan" shall be a direct rollover.
Notwithstanding the foregoing, a "qualified distributee" may not elect a direct
rollover with respect to an "eligible rollover distribution" if the total value
of such distribution is less than $200 or with respect to a portion of an
"eligible rollover distribution" if the value of such portion is less than $500.
For purposes of this Section, the following terms have the following meanings:
(a) An "eligible retirement plan" means 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 rollovers;
provided, however, that,
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in the case of a direct rollover by a surviving spouse, an eligible
retirement plan does not include a qualified trust described in Code
Section 401(a).
(b) An "eligible rollover distribution" means any distribution of all or any
portion of the balance of a Participant's Account; provided, however, that
an eligible rollover distribution does not include the following:
(1) any distribution to the extent such distribution is required under
Code Section 401(a)(9).
(2) the portion of any distribution that consists of the Participant's
After-Tax Contributions.
(3) any distribution that is one of a series of substantially equal
periodic payment made not less frequently than annually for the life
or life expectancy of the "qualified distributee" or the joint lives
or life expectancies of the "qualified distributee" and the "qualified
distributee's" designated beneficiary, or for a specified period of
ten years or more.
(4) any hardship withdrawal of Tax-Deferred Contributions made in
accordance with the provisions of Article XIII.
(c) A "qualified distributee" means a Participant, his surviving spouse, or his
spouse or former spouse who is an alternate payee under a qualified
domestic relations order, as defined in Code Section 414(p).
16.6 Notice Regarding Forms of Payment
Within the 60 day period ending 30 days before a Participant's Benefit Payment
Date, the Administrator shall provide the Participant with a written explanation
of his right to defer distribution until Normal Retirement Age, his right to
make a direct rollover and the forms of payment provided under the Plan.
Distribution of the Participant's Account may commence fewer than 30 days after
such notice is provided to the Participant if (i) the Administrator clearly
informs the Participant of his right to consider his election of whether or not
to make a direct rollover or to receive a distribution prior to Normal
Retirement Age and his form of payment for a period of at least 30 days
following his receipt of the notice and (ii) the Participant, after receiving
the notice, affirmatively elects an early distribution.
16.7 Re-Employment
If a Participant is re-employed by an Employer or a Related Company prior to
receiving distribution of the entire balance of his vested interest in his
Account, his prior election of a form of payment hereunder shall remain in
effect and distributions pursuant to such form shall continue uninterrupted.
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16.8 Distribution in the Form of Employer Stock
Notwithstanding any other provision of the plan to the contrary, to the extent
any portion of a Participant's Account is invested in Employer Stock, he may
elect to receive a distribution of that portion in the form of Employer stock.
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ARTICLE XVII
BENEFICIARIES
17.1 Designation of Beneficiary
A married Participant's Beneficiary shall be his spouse, unless the Participant
designates a person or persons other than his spouse as Beneficiary with his
spouse's written consent; provided, however, that such written spousal consent
shall not be required if the Participant is not married to such spouse on his
Benefit Payment Date. A Participant's designation of a Beneficiary shall be
subject to the Qualified Preretirement Survivor Annuity provisions of the
Addendum A, with respect to Merged Plan Accounts, if applicable.
If no Beneficiary has been designated pursuant to the provisions of this
Section, or if no Beneficiary survives the Participant and he has no surviving
spouse, then the Beneficiary under the Plan shall be the Participant's estate.
If a Beneficiary dies after becoming entitled to receive a distribution under
the Plan but before distribution is made to him in full, and if no other
Beneficiary has been designated to receive the balance of the distribution in
that event, the estate of the deceased Beneficiary shall be the Beneficiary as
to the balance of the distribution.
17.2 Spousal Consent Requirements
Any written spousal consent given pursuant to this Article must acknowledge the
effect of the action taken and must be witnessed by a Plan representative or a
notary public. In addition, the spouse's written consent must either (i)
specify any non-spouse Beneficiary designated by the Participant and that such
Beneficiary may not be changed without written spousal consent or (ii)
acknowledge that the spouse has the right to limit consent to a specific
Beneficiary, but permit the Participant to change the designated Beneficiary
without the spouse's further consent. A Participant's spouse will be deemed to
have given written consent to the Participant's designation of Beneficiary if
the Participant establishes to the satisfaction of a Plan representative that
such consent cannot be obtained because the spouse cannot be located or because
of other circumstances set forth in Section 401(a)(11) of the Code and
regulations issued thereunder. Any written consent given or deemed to have been
given by a Participant's spouse hereunder shall be valid only with respect to
the spouse who signs the consent.
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ARTICLE XVIII
ADMINISTRATION
18.1 Appointment of Committee
The Sponsor shall appoint a Committee, consisting of at least three (3) persons
which shall be the Plan Administrator and named fiduciary of the Plan under
ERISA and to perform administrative duties as set forth herein. Each member of
the Committee shall serve for such term as the Board of Directors of the Sponsor
may designate or until his death, resignation or removal by the Board. The
Sponsor shall promptly appoint successors to fill vacancies in the Committee;
however, during interim periods which occur after resignation or death of a
Committee member and before the appointment of a new member, the Committee may
operate with fewer than three (3) members. All usual and reasonable expenses of
the Committee may be paid in whole or in part by the Sponsor, and any expenses
not paid by the Sponsor shall be paid by the Trustee out of the principal or
income of the Trust. The members of the Committee shall not receive
compensation with respect to their services for the Committee. The members of
the Committee shall serve without bond or security for the performance of their
duties hereunder unless the applicable law makes the furnishing of such bond or
security mandatory or unless required by the Administrator. The Sponsor may pay
the premium on any bond secured under this Section including the purchase of
fiduciary liability insurance for any person who becomes a fiduciary under this
Plan.
18.2 Committee Powers and Duties
The Committee shall have such powers as may be necessary to discharge its duties
hereunder, including, but no by way of limitation, the following powers and
duties:
a. to interpret and construe, in its discretion, all terms, provisions,
conditions and limitations of the Plan and to reconcile any inconsistency
or supply any omitted detail that may appear in this Plan in such manner
and to such extent, consistent with the general terms of the Plan, as the
Committee shall deem is necessary and proper to effectuate the Plan for the
greatest benefit of all Participants;
b. to determine all questions, in its discretion, relating to eligibility
of Employees to become Participants; all periods of Vesting and Eligibility
Service credit of Participants and Compensation of Participants;
c. to prescribe rules for the operation of the Plan as are not
inconsistent with the terms of the Plan;
d. to determine the amount, manner and time of payment of any benefits
hereunder and to authorize all disbursements by the Trustee from the Trust
Fund,
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except disbursements for ordinary expenses incurred in the administration
of the Trust;
e. to prescribe forms or procedures to be followed by Participants or
Beneficiaries filing applications for benefits, and for other occurrences n
the administration of the Plan; and
f. to receive from the Employer and from Employees such information as
shall be necessary for the proper administration of the Plan;
g. to employ and independent qualified public accountant to examine the
books, records, and any financial statements and schedules which are
required to be included in the annual report;
h to file with the appropriate government agency (or agencies) the annual
report, plan description summary plan description, and other pertinent
documents which may be duly requested;
i. to file such terminal and supplementary reports as may be necessary in
the event of the termination of the Plan;
j. to furnish each Employee and each Beneficiary receiving benefits
hereunder a summary plan description explaining the Plan;
k. to furnish any Employee or Beneficiary, who requests in writing,
statements indicating such Employee's or Beneficiary's total account
balances and nonforfeitable benefits, if any;
l. to furnish to an Employee a statement containing information contained
in a registration statement required by Section 6057(a)(2) of the Internal
Revenue Code of 1986 prior to the time prescribed by law to file such
registration if such statement contains information regarding the Employee;
m. to maintain all records necessary for verification of information
required to be filed with the appropriate government agency (or agencies);
n. to report to the Trustee all available information regarding the amount
of benefits payable to each Employee, the computations with respect to the
allocation of assets, and any other information which the Trustee may
require in order to terminate the Plan;
o. to delegate to one or more of the members of the Committee the right to
act in its behalf in all matters connected with the administration of the
Plan and Trust;
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p. to delegate to any individual(s) such of the above powers and duties as
the Committee deems appropriate;
q. to appoint or employ for the Plan any agents it deems advisable,
including, but not limited to, legal counsel; and
r. in addition to all other powers herein granted, and consistent with the
provisions hereof, the Committee shall have all other rights and powers
reasonably necessary to supervise and control the administration of this
Plan, including the right to administer the Plan in a manner reasonably
calculated to comply with any changes in or modifications to all relevant
laws, as such changes may be made from time to time.
All rules and decisions of the Committee shall be uniformly and consistently
applied to all Employees in similar circumstances.
A majority of the members of the Committee shall constitute a quorum for the
transaction of business. No action shall be taken except upon a majority vote
of the Committee members or by unanimous written consent. An individual shall
not vote or decide upon any matter relating solely to himself or vote in any
cases in which his individual right or claim to any benefit under the Plan is
particularly involved. If, in any case in which a Committee member is so
disqualified to act, and the remaining members cannot agree, the Board of
Directors of the Sponsor will appoint a temporary substitute member to exercise
all the powers of the disqualified member concerning the matter in which he is
disqualified.
In addition to all other powers herein granted, and consistent with the
provisions hereof, the Committee shall have the discretionary authority to
exercise all other rights and powers reasonably necessary to supervise and
control the administration of this Plan. The determination of any fact by the
Committee and the construction placed by the Committee upon the provisions of
this Plan shall be binding upon all of the Participants under this Plan, their
Beneficiaries and the Employers.
18.3 Claim Procedure
The Committee may prescribe procedures for obtaining benefits and is required to
provide a notice in writing to any person whose claim for benefits under this
Plan has been denied, setting forth (1) the specific reason for such denial, (2)
the specific reference to pertinent Plan provisions on which the denial is
based, (3) a description of any additional material or information necessary to
the claimant to perfect the claim and an explanation of why such material or
information is necessary, and (4) an explanation of the Plan's claim review
procedure as described below, including the name and address of the party to
whom an appeal should be sent.
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A claimant has the right to appeal a denial of claim by written application to
the Committee within sixty (60) days of notice of denial or, if no such notice
has been given, at the end of the expiration of a reasonable period of time
after the claim was filed. The claimant, or a duly authorized representative,
may review pertinent documents and may submit issues and comments in writing to
the Committee.
After the Committee reviews the claims appeal, a final decision shall be made
and communicated to the claimant within sixty (60) days of receipt of the appeal
by the Committee, unless special circumstances require an extension. Such
extension cannot extend beyond one hundred twenty (120) days after receipt of
the appeal by the Committee. The communication shall be set forth in writing in
a manner calculated to be understood by the claimant and shall identify the
reasons for the denial and shall reference any pertinent Plan provisions upon
which the denial is based.
18.4 Committee Procedures
The Committee shall adopt such bylaws as it deems desirable. The Committee
shall elect one of its members as chairman and shall elect a secretary who may,
but need not be a member of the Committee. The Committee shall advise the
Trustee of such elections in writing. The Secretary of the Committee shall keep
a record of all meetings and forward all necessary communications to the
Trustee.
18.5 Authorization of Benefit Payments
The Committee shall issue directions to the Trustee concerning all benefits
which are to be paid from the Trust pursuant to the provisions of the Plan. The
Committee shall keep on file, in such manner, as it may deem convenient or
proper, all reports from the Trustee.
18.6 Authority of the Sponsor
The Sponsor, by action of its board of directors, may:
(a) allocate any of the powers, authority, or responsibilities for the
operation and administration of the Plan (other than trustee
responsibilities as defined in Section 405(c)(3) of ERISA) among named
fiduciaries; and
(b) designate a person or persons other than a named fiduciary to carry out any
of such powers, authority, or responsibilities;
except that no allocation by the Sponsor of, or designation by the Sponsor with
respect to, any of such powers, authority, or responsibilities to another named
fiduciary or a person other than a named fiduciary shall become effective unless
such allocation or designation shall first be accepted by such named fiduciary
or other person in a writing signed by it and delivered to the Sponsor.
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18.7 Qualified Domestic Relations Orders
The Administrator shall establish reasonable procedures to determine the status
of domestic relations orders and to administer distributions under domestic
relations orders which are deemed to be qualified orders. Such procedures shall
be in writing and shall comply with the provisions of Section 414(p) of the Code
and regulations issued thereunder.
18.8 Indemnity
The Sponsor indemnifies and saves harmless any member of the Board of Directors
of an Employer or of the Sponsor, any member of the Committee and any Employee
of an Employer or of the Sponsor from and against any and all loss resulting
from liability to which any such person may be subjected by reason of any
conduct (except willful or reckless misconduct) in a fiduciary capacity under
this Plan or Trust, or both, including all expenses reasonably incurred in such
person's defense, in case the Corporation fails to provide such defense. The
indemnification provisions of this Section shall not relieve any such person of
any liability he may have under ERISA for breach of a fiduciary duty.
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ARTICLE XIX
AMENDMENT AND TERMINATION
19.1 Amendment
Subject to the provisions of Section 19.2, the Sponsor may at any time and from
time to time, by action of its board of directors, or such officers of the
Sponsor as are authorized by its board of directors, amend the Plan, either
prospectively or retroactively. Any such amendment shall be by written
instrument executed by the Sponsor.
19.2 Limitation on Amendment
The Sponsor shall make no amendment to the Plan which shall decrease the accrued
benefit of any Participant or Beneficiary, except that nothing contained herein
shall restrict the right to amend the provisions of the Plan relating to the
administration of the Plan and Trust. Moreover, no such amendment shall be made
hereunder which shall permit any part of the Trust to revert to an Employer or
any Related Company or be used or be diverted to purposes other than the
exclusive benefit of Participants and Beneficiaries. The Sponsor shall make no
retroactive amendment to the Plan unless such amendment satisfies the
requirements of Code Section 401(b) and/or Section 1.401(a)(4)-11(g) of the
Treasury regulations, as applicable.
19.3 Termination
The Sponsor reserves the right, by action of its board of directors, to
terminate the Plan as to all Employers at any time (the effective date of such
termination being hereinafter referred to as the "termination date"). Upon any
such termination of the Plan, the following actions shall be taken for the
benefit of Participants and Beneficiaries:
(a) As of the termination date, each Investment Fund shall be valued and all
Accounts and Sub-Accounts shall be adjusted in the manner provided in
Article XI, with any unallocated contributions or forfeitures being
allocated as of the termination date in the manner otherwise provided in
the Plan. The termination date shall become a Valuation Date for purposes
of Article XI. In determining the net worth of the Trust, there shall be
included as a liability such amounts as shall be necessary to pay all
expenses in connection with the termination of the Trust and the
liquidation and distribution of the property of the Trust, as well as other
expenses, whether or not accrued, and shall include as an asset all accrued
income.
(b) All Accounts shall then be disposed of to or for the benefit of each
Participant or Beneficiary in accordance with the provisions of Article XV
as if the termination date were his Settlement Date; provided, however,
that notwithstanding the provisions of Article XV, if the Plan does not
offer an annuity option and if neither his Employer nor a Related Company
establishes or maintains another
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defined contribution plan (other than an employee stock ownership plan as
defined in Code Section 4975(e)(7)), the Participant's written consent to
the commencement of distribution shall not be required regardless of the
value of the vested portions of his Account.
(c) Notwithstanding the provisions of paragraph (b) of this Section, no
distribution shall be made to a Participant of any portion of the balance
of his Tax-Deferred Contributions Sub-Account prior to his separation from
service (other than a distribution made in accordance with Article XIII or
required in accordance with Code Section 401(a)(9)) unless (i) neither his
Employer nor a Related Company establishes or maintains another defined
contribution plan (other than an employee stock ownership plan as defined
in Code Section 4975(e)(7), a tax credit employee stock ownership plan as
defined in Code Section 409, or a simplified employee pension as defined in
Code Section 408(k)) either at the time the Plan is terminated or at any
time during the period ending 12 months after distribution of all assets
from the Plan; provided, however, that this provision shall not apply if
fewer than two percent of the Eligible Employees under the Plan were
eligible to participate at any time in such other defined contribution plan
during the 24- month period beginning 12 months before the Plan
termination, and (ii) the distribution the Participant receives is a "lump
sum distribution" as defined in Code Section 402(e)(4), without regard to
clauses (i), (ii), (iii), and (iv) of sub-paragraph (A), sub-paragraph (B),
or sub-paragraph (H) thereof.
Notwithstanding anything to the contrary contained in the Plan, upon any such
Plan termination, the vested interest of each Participant and Beneficiary in his
Employer Contributions Sub-Account shall be 100 percent; and, if there is a
partial termination of the Plan, the vested interest of each Participant and
Beneficiary who is affected by the partial termination in his Employer
Contributions Sub-Account shall be 100 percent. For purposes of the preceding
sentence only, the Plan shall be deemed to terminate automatically if there
shall be a complete discontinuance of contributions hereunder by all Employers.
19.4 Reorganization
The merger, consolidation, or liquidation of any Employer with or into any other
Employer or a Related Company shall not constitute a termination of the Plan as
to such Employer. If an Employer disposes of substantially all of the assets
used by the Employer in a trade or business or disposes of a subsidiary and in
connection therewith one or more Participants terminates employment but
continues in employment with the purchaser of the assets or with such
subsidiary, no distribution from the Plan shall be made to any such Participant
from his Tax- Deferred Contributions Sub-Account prior to his separation from
service (other than a distribution made in accordance with Article XIII or
required in accordance with Code Section 401(a)(9)), except that a distribution
shall be permitted to be made in such a case, subject to the Participant's
consent (to the extent required by law), if (i) the distribution would
constitute a "lump sum distribution"
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as defined in Code Section 402(e)(4), without regard to clauses (i), (ii),
(iii), or (iv) of sub-paragraph (A), sub-paragraph (B), or sub-paragraph (H)
thereof, (ii) the Employer continues to maintain the Plan after the disposition,
(iii) the purchaser does not maintain the Plan after the disposition, and (iv)
the distribution is made by the end of the second calendar year after the
calendar year in which the disposition occurred.
19.5 Withdrawal of an Employer
An Employer other than the Sponsor may withdraw from the Plan at any time upon
notice in writing to the Administrator (the effective date of such withdrawal
being hereinafter referred to as the "withdrawal date"), and shall thereupon
cease to be an Employer for all purposes of the Plan. An Employer shall be
deemed automatically to withdraw from the Plan in the event of its complete
discontinuance of contributions, or, subject to Section 19.4 and unless the
Sponsor otherwise directs, it ceases to be a Related Company of the Sponsor or
any other Employer. The interest of any Participant employed by the withdrawing
Employer who is transferred to or continues in employment with any other
Employer or a Related Company, and the interest of any Participant employed
solely by an Employer or a Related Company other than the withdrawing Employer,
shall remain unaffected by such withdrawal; no adjustment to his Accounts shall
be made by reason of the withdrawal; and he shall continue as a Participant
hereunder subject to the remaining provisions of the Plan.
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ARTICLE XX
ADOPTION BY OTHER ENTITIES
20.1 Adoption by Related Companies
A Related Company that is not an Employer may, with the consent of the Sponsor,
adopt the Plan and become an Employer hereunder by causing an appropriate
written instrument evidencing such adoption to be executed in accordance with
the requirements of its organizational authority. Any such instrument shall
specify the effective date of the adoption.
20.2 Effective Plan Provisions
An Employer who adopts the Plan shall be bound by the provisions of the Plan in
effect at the time of the adoption and as subsequently in effect because of any
amendment to the Plan.
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ARTICLE XXI
MISCELLANEOUS PROVISIONS
21.1 No Commitment as to Employment
Nothing contained herein shall be construed as a commitment or agreement upon
the part of any person to continue his employment with an Employer or Related
Company, or as a commitment on the part of any Employer or Related Company to
continue the employment, compensation, or benefits of any person for any period.
21.2 Benefits
Nothing in the Plan nor the Trust Agreement shall be construed to confer any
right or claim upon any person, firm, or corporation other than the Employers,
the Trustee, Participants, and Beneficiaries.
21.3 No Guarantees
The Employers, the Administrator, and the Trustee do not guarantee the Trust
from loss or depreciation, nor do they guarantee the payment of any amount which
may become due to any person hereunder.
21.4 Expenses
The expenses of administration of the Plan, including the expenses of the
Administrator and fees of the Trustee, shall be paid from the Trust as a general
charge thereon, unless the Sponsor elects to make payment. Notwithstanding the
foregoing, the Sponsor may direct that administrative expenses that are
allocable to the Account of a specific Participant shall be paid from that
Account and that the costs incident to the management of the assets of an
Investment Fund or to the purchase or sale of securities held in an Investment
Fund shall be paid by the Trustee from such Investment Fund.
21.5 Precedent
Except as otherwise specifically provided, no action taken in accordance with
the Plan shall be construed or relied upon as a precedent for similar action
under similar circumstances.
21.6 Duty to Furnish Information
The Employers, the Administrator, and the Trustee shall furnish to any of the
others any documents, reports, returns, statements, or other information that
the other reasonably deems necessary to perform its duties hereunder or
otherwise imposed by law.
21.7 Withholding
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The Trustee shall withhold any tax which by any present or future law is
required to be withheld, and which the Administrator notifies the Trustee in
writing is to be so withheld, from any payment to any Participant or Beneficiary
hereunder.
21.8 Merger, Consolidation, or Transfer of Plan Assets
The Plan shall not be merged or consolidated with any other plan, nor shall any
of its assets or liabilities be transferred to another plan, unless, immediately
after such merger, consolidation, or transfer of assets or liabilities, each
Participant in the Plan would receive a benefit under the Plan which is at least
equal to the benefit he would have received immediately prior to such merger,
consolidation, or transfer of assets or liabilities (assuming in each instance
that the Plan had then terminated).
21.9 Back Pay Awards
The provisions of this Section shall apply only to an Employee or former
Employee who becomes entitled to back pay by an award or agreement of an
Employer without regard to mitigation of damages. If a person to whom this
Section applies was or would have become an Eligible Employee after such back
pay award or agreement has been effected, and if any such person who had not
previously elected to make Tax-Deferred Contributions pursuant to Section 4.1
shall within 30 days of the date he receives notice of the provisions of this
Section make an election to make Tax-Deferred Contributions in accordance with
such Section 4.1 (retroactive to any Enrollment Date as of which he was or has
become eligible to do so), then such Participant may elect that any Tax-Deferred
Contributions not previously made on his behalf but which, after application of
the foregoing provisions of this Section, would have been made under the
provisions of Article IV shall be made out of the proceeds of such back pay
award or agreement. In addition, if any such Employee or former Employee would
have been eligible to participate in the allocation of Employer Contributions
under the provisions of Article VI or XXII for any prior Plan Year after such
back pay award or agreement has been effected, his Employer shall make an
Employer Contribution equal to the amount of the Employer Contribution which
would have been allocated to such Participant under the provisions of Article VI
or XXII as in effect during each such Plan Year. The amounts of such additional
contributions shall be credited to the Account of such Participant. Any
additional contributions made pursuant to this Section shall be made in
accordance with, and subject to the limitations of the applicable provisions of
the Plan.
21.10 Condition on Employer Contributions
Notwithstanding anything to the contrary contained in the Plan or the Trust
Agreement, any contribution of an Employer hereunder is conditioned upon the
continued qualification of the Plan under Code Section 401(a), the exempt status
of the Trust under Code Section 501(a), and the deductibility of the
contribution under Code Section 404. Except as otherwise provided in this
Section and Section 21.11, however, in no event
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shall any portion of the property of the Trust ever revert to or otherwise inure
to the benefit of an Employer or any Related Company.
21.11 Return of Contributions to an Employer
Notwithstanding any other provision of the Plan or the Trust Agreement to the
contrary, in the event any contribution of an Employer made hereunder:
(a) is made under a mistake of fact, or
(b) is disallowed as a deduction under Code Section404,
such contribution may be returned to the Employer within one year after the
payment of the contribution or the disallowance of the deduction to the extent
disallowed, whichever is applicable. In the event the Plan does not initially
qualify under Code Section 401(a), any contribution of an Employer made
hereunder may be returned to the Employer within one year of the date of denial
of the initial qualification of the Plan, but only if an application for
determination was made within the period of time prescribed under ERISA Section
403(c)(2)(B).
21.12 Validity of Plan
The validity of the Plan shall be determined and the Plan shall be construed and
interpreted in accordance with the laws of the state or commonwealth in which
the Sponsor has its principal place of business, except as preempted by
applicable Federal law. The invalidity or illegality of any provision of the
Plan shall not affect the legality or validity of any other part thereof.
21.13 Trust Agreement
The Trust Agreement and the Trust maintained thereunder shall be deemed to be a
part of the Plan as if fully set forth herein and the provisions of the Trust
Agreement are hereby incorporated by reference into the Plan.
21.14 Parties Bound
The Plan shall be binding upon the Employers, all Participants and Beneficiaries
hereunder, and, as the case may be, the heirs, executors, administrators,
successors, and assigns of each of them.
21.15 Application of Certain Plan Provisions
For purposes of the general administrative provisions and limitations of the
Plan, a Participant's Beneficiary or alternate payee under a qualified domestic
relations order shall be treated as any other person entitled to receive
benefits under the Plan. Upon any
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termination of the Plan, any such Beneficiary or alternate payee under a
qualified domestic relations order who has an interest under the Plan at the
time of such termination, which does not cease by reason thereof, shall be
deemed to be a Participant for all purposes of the Plan. A Participant's
Beneficiary, if the Participant has died, or alternate payee under a qualified
domestic relations order shall be treated as a Participant for purposes of
directing investments as provided in Article X.
21.16 Merged Plans
In the event another defined contribution plan (the "merged plan") is merged
into and made a part of the Plan, each Employee who was eligible to participate
in the "merged plan" immediately prior to the merger shall become an Eligible
Employee on the date of the merger. In no event shall a Participant's vested
interest in his Sub-Account attributable to amounts transferred to the Plan from
the "merged plan" (his "transferee Sub-Account") on and after the merger be less
than his vested interest in his account under the "merged plan" immediately
prior to the merger. Notwithstanding any other provision of the Plan to the
contrary, a Participant's service credited for eligibility and vesting purposes
under the "merged plan" as of the merger, if any, shall be included as
Eligibility and Vesting Service under the Plan to the extent Eligibility and
Vesting Service are credited under the Plan. Special provisions applicable to a
Participant's "transferee Sub-Account", if any, shall be specifically reflected
in the Plan or in an Addendum to the Plan.
21.17 Transferred Funds
If funds from another qualified plan are transferred or merged into the Plan,
such funds shall be held and administered in accordance with any restrictions
applicable to them under such other plan to the extent required by law and shall
be accounted for separately to the extent necessary to accomplish the foregoing.
21.18 Veterans Re-Employment Rights
Notwithstanding any other provision of the Plan to the contrary, contributions,
benefits, and service credit with respect to qualified military service shall be
provided in accordance with Code Section 414(u). The Administrator shall notify
the Trustee of any Participant with respect to whom additional contributions are
made because of qualified military service.
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ARTICLE XXII
TOP-HEAVY PROVISIONS
22.1 Definitions
For purposes of this Article, the following terms shall have the following
meanings:
(a) The "compensation" of an employee means "compensation" as defined in Code
Section 415 and regulations issued thereunder. In no event, however, shall
the "compensation" of a Participant taken into account under the Plan for
any Plan Year exceed $170,000 (subject to adjustment annually as provided
in Code Sections 401(a)(17)(B) and 415(d); provided, however, that the
dollar increase in effect on January 1 of any calendar year, if any, is
effective for Plan Years beginning in such calendar year).
(b) The "determination date" with respect to any Plan Year means the last day
of the preceding Plan Year, except that the "determination date" with
respect to the first Plan Year of the Plan, shall mean the last day of such
Plan Year.
(c) A "key employee" means any Employee or former Employee who is a "key
employee" pursuant to the provisions of Code Section 416(i)(1) and any
Beneficiary of such Employee or former Employee.
(d) A "non-key employee" means any Employee who is not a "key employee".
(e) A "permissive aggregation group" means those plans included in each
Employer's "required aggregation group" together with any other plan or
plans of the Employer, so long as the entire group of plans would continue
to meet the requirements of Code Sections 401(a)(4) and 410.
(f) A "required aggregation group" means the group of tax-qualified plans
maintained by an Employer or a Related Company consisting of each plan in
which a "key employee" participates and each other plan that enables a plan
in which a "key employee" participates to meet the requirements of Code
Section 401(a)(4) or Code Section 410, including any plan that terminated
within the five-year period ending on the relevant "determination date".
(g) A "super top-heavy group" with respect to a particular Plan Year means a
"required" or "permissive aggregation group" that, as of the "determination
date", would qualify as a "top-heavy group" under the definition in
paragraph(i) of this Section with "90 percent" substituted for "60 percent"
each place where "60 percent" appears in the definition.
(h) A "super top-heavy plan" with respect to a particular Plan Year means a
plan that, as of the "determination date", would qualify as a "top-heavy
plan" under the
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definition in paragraph (j) of this Section with "90 percent" substituted
for "60 percent" each place where "60 percent" appears in the definition. A
plan is also a "super top-heavy plan" if it is part of a "super top-heavy
group".
(i) A "top-heavy group" with respect to a particular Plan Year means a
"required" or "permissive aggregation group" if the sum, as of the
"determination date", of the present value of the cumulative accrued
benefits for "key employees" under all defined benefit plans included in
such group and the aggregate of the account balances of "key employees"
under all defined contribution plans included in such group exceeds 60
percent of a similar sum determined for all employees covered by the plans
included in such group.
(j) A "top-heavy plan" with respect to a particular Plan Year means (i), in the
case of a defined contribution plan (including any simplified employee
pension plan), a plan for which, as of the "determination date", the
aggregate of the accounts (within the meaning of Code Section 416(g) and
the regulations and rulings thereunder) of "key employees" exceeds 60
percent of the aggregate of the accounts of all participants under the
plan, with the accounts valued as of the relevant valuation date and
increased for any distribution of an account balance made in the five-year
period ending on the "determination date", (ii), in the case of a defined
benefit plan, a plan for which, as of the "determination date", the present
value of the cumulative accrued benefits payable under the plan (within the
meaning of Code Section 416(g) and the regulations and rulings thereunder)
to "key employees" exceeds 60 percent of the present value of the
cumulative accrued benefits under the plan for all employees, with the
present value of accrued benefits for employees (other than "key
employees") to be determined under the accrual method uniformly used under
all plans maintained by an Employer or, if no such method exists, under the
slowest accrual method permitted under the fractional accrual rate of Code
Section 411(b)(1)(C) and including the present value of any part of any
accrued benefits distributed in the five-year period ending on the
"determination date", and (iii) any plan (including any simplified employee
pension plan) included in a "required aggregation group" that is a "top-
heavy group". For purposes of this paragraph, the accounts and accrued
benefits of any employee who has not performed services for an Employer or
a Related Company during the five-year period ending on the "determination
date" shall be disregarded. For purposes of this paragraph, the present
value of cumulative accrued benefits under a defined benefit plan for
purposes of top-heavy determinations shall be calculated using the
actuarial assumptions otherwise employed under such plan, except that the
same actuarial assumptions shall be used for all plans within a "required"
or "permissive aggregation group". A Participant's interest in the Plan
attributable to any Rollover Contributions, except Rollover Contributions
made from a plan maintained by an Employer or a Related Company, shall not
be considered in determining whether the Plan is top-heavy. Notwithstanding
the foregoing, if a
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plan is included in a "required" or "permissive aggregation group" that is
not a "top-heavy group", such plan shall not be a "top-heavy plan".
(k) The "valuation date" with respect to any "determination date" means the
most recent Valuation Date occurring within the 12-month period ending on
the "determination date".
22.2 Applicability
Notwithstanding any other provision of the Plan to the contrary, the provisions
of this Article shall be applicable during any Plan Year in which the Plan is
determined to be a "top-heavy plan" as hereinafter defined. If the Plan is
determined to be a "top-heavy plan" and upon a subsequent "determination date"
is determined no longer to be a "top-heavy plan", the vesting provisions of this
Article shall continue to apply.
22.3 Minimum Employer Contribution
If the Plan is determined to be a "top-heavy plan" for a Plan Year, the Employer
Contributions, other than Matching Contributions, allocated to the Account of
each "non-key employee" who is an Eligible Employee and who is employed by an
Employer or a Related Company on the last day of such top-heavy Plan Year shall
be no less than the lesser of (i) three percent of his "compensation" or (ii)
the largest percentage of "compensation" that is allocated as an Employer
Contribution and/or Tax-Deferred Contribution for such Plan Year to the Account
of any "key employee"; except that, in the event the Plan is part of a "required
aggregation group", and the Plan enables a defined benefit plan included in such
group to meet the requirements of Code Section 401(a)(4) or 410, the minimum
allocation of Employer Contributions to each such "non-key employee" shall be
three percent of the "compensation" of such "non-key employee". Any minimum
allocation to a "non-key employee" required by this Section shall be made
without regard to any social security contribution made on behalf of the non-key
employee, his number of hours of service, his level of "compensation", or
whether he declined to make elective or mandatory contributions.
Employer Contributions allocated to a Participant's Account in accordance with
this Section shall be considered annual additions under Article VII for the
limitation year for which they are made and shall be separately accounted for.
Employer Contributions allocated to a Participant's Account shall be allocated
upon receipt among the Investment Funds in accordance with the Participant's
currently effective investment election.
22.4 Accelerated Vesting
If the Plan is determined to be a top-heavy plan, a Participant's vested
interest in his Employer Contributions Sub-Account shall be determined no less
rapidly than in accordance with the following vesting schedule:
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Year of Vesting Service Vested Interest
Less than 1 0%
1 or more 100%
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ARTICLE XXIII
EFFECTIVE DATE
23.1 Effective Date
The Plan is effective as of April 1, 2000.
* * *
EXECUTED AT __________________________________________,
________________________, this _________ day of ________________, 2000.
ENCOMPASS SERVICES CORPORATION
By:______________________________
Name:____________________________
Title: __________________________
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Addendum A - Grandfathered Annuity Form of Payment
A.1 Applicability
Notwithstanding any other provision of the Plan to the contrary, the following
provisions apply with respect to the Merged Plan Account of a former participant
in one of the following plans that merged into the Plan effective April 1, 2000:
1. Advent Electric Co., Inc. 401(k) Profit Sharing Plan;
2. American Air Company, Inc. 401(k) Profit Sharing Plan;
3. Building One Services Corporation 401(k) Profit Sharing Plan;
4. Chambers Electronic Communications, LLC 401(k) Profit Sharing Plan and
Trust;
5. Ivey's, Inc. Salary Reduction Plan;
6. The Lewis Companies, Inc. 401(k) Plan;
7. National Network Services, Inc. 401(k) Plan.
8. Robinson Mechanical Company's 401(k) Plan;
9. SKC Electric, Inc. Profit Sharing and 401(k) Retirement Plan;
10. Tri-M Corporation 401(k) Profit Sharing & Savings Plan; and
11. Walker Engineering, Inc. Employee Savings Plan & Trust Agreement
(restricted to those participants in the plan on June 30, 1988)
The term "Participant" when used in this Addendum refers only to a Participant
who satisfies the requirements described above.
A.2 Definitions
For purposes of this Article, the following terms have the following meanings:
(a) The "automatic annuity form" means the form of annuity that will be
purchased on behalf of a Participant who has elected to receive
distribution through the purchase of an annuity contract that provides for
payment over his life unless the Participant elects another form of
annuity.
(b) A "qualified election" means an election that is made during the qualified
election period. A "qualified election" of a form of payment other than a
Qualified Joint and Survivor Annuity or designating a Beneficiary other
than the Participant's spouse to receive amounts otherwise payable as a
Qualified Preretirement Survivor Annuity must include the written consent
of the Participant's spouse, if any. A Participant's spouse will be deemed
to have given written consent to the Participant's election if the
Participant establishes to the satisfaction of a Plan representative that
spousal consent cannot be obtained because the spouse cannot be located or
because of other circumstances set forth in Code Section 401(a)(11) and
regulations issued thereunder. The spouse's written consent must
acknowledge the effect of the Participant's election and must be witnessed
by a Plan representative or a notary public. In addition, the spouse's
written consent
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must either (i) specify the form of payment selected instead of a Qualified
Joint and Survivor Annuity, if applicable, and that such form may not be
changed (except to a Qualified Joint and Survivor Annuity) without written
spousal consent and specify any non-spouse Beneficiary designated by the
Participant, if applicable, and that such Beneficiary may not be changed
without written spousal consent or (ii) acknowledge that the spouse has the
right to limit consent as provided in clause (i), but permit the
Participant to change the form of payment selected or the designated
Beneficiary without the spouse's further consent. Any written consent given
or deemed to have been given by a Participant's spouse hereunder shall be
irrevocable and shall be effective only with respect to such spouse and not
with respect to any subsequent spouse.
(c) The "qualified election period" with respect to the "automatic annuity
form" means the 90 day period ending on a Participant's Benefit Payment
Date. The "qualified election period" with respect to a Qualified
Preretirement Survivor Annuity means the period beginning on the later of
(i) the date his Account becomes subject to the automatic annuity
provisions of this Addendum or (ii) the first day of the Plan Year in which
the Participant attains age 35 or, if he terminates employment prior to
such date, the day he terminates employment with his Employer and all
Related Companies. A Participant whose employment has not terminated may
make a "qualified election" designating a Beneficiary other than his spouse
prior to the Plan Year in which he attains age 35; provided, however, that
such election shall cease to be effective as of the first day of the Plan
Year in which the Participant attains age 35.
A.3 Normal Form of Payment
Unless a Participant, or his Beneficiary (if the Participant has died), elects
the optional annuity form of payment provided in this Addendum or the optional
form described in Section XVI, distribution shall be made to the Participant, or
his Beneficiary, as the case may be, in the normal form of payment provided in
Article XVI.
A.4 Optional Annuity Form of Payment
The Participant (or his Beneficiary, if the Participant has died) may elect to
receive distribution of all or a portion of his Account through the purchase of
a single premium, nontransferable annuity contract from an insurance company.
The Participant or his Beneficiary may select, subject to the automatic annuity
form requirements of Section A.6, the term and the form of the annuity payment
from those available from the insurance company. Notwithstanding the foregoing,
a Participant's Beneficiary may not elect to receive distribution of an annuity
payable over the joint lives of the Beneficiary and any other individual.
The terms of any annuity contract purchased hereunder and distributed to a
Participant or his Beneficiary shall comply with the requirements of the Plan.
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A.5 Change of Election
Subject to the automatic annuity requirements of this Addendum, a Participant or
Beneficiary who has elected a form of payment provided under Article XVI or this
Addendum may revoke or change his election at any time prior to his Benefit
Payment Date by filing his election with the Administrator in the form
prescribed by the Administrator.
A.6 Automatic Annuity Requirements
If a Participant elects to receive distribution through the purchase of an
annuity contract that provides for payment over his life, distribution shall be
made to such Participant through the purchase of an annuity contract that
provides for payment in one of the following "automatic annuity forms", unless
the Participant elects a different type of annuity.
(a) The "automatic annuity form" for a Participant who is married on his
Benefit Payment Date is the 50 percent Qualified Joint and Survivor
Annuity.
(b) The "automatic annuity form" for a Participant who is not married on his
Benefit Payment Date is the Single Life Annuity.
A Participant who has elected to receive distribution through the purchase of an
annuity contract that provides for payment over his life may only change his
election of a form of payment pursuant to a "qualified election"; provided,
however, that spousal consent shall not be required if the form of payment
elected by the Participant is a Qualified Joint and Survivor Annuity.
A.7 Qualified Preretirement Survivor Annuity Requirements
If a married Participant who elects to receive distribution through the purchase
of an annuity contract that provides for payment over his life dies before his
Benefit Payment Date, his spouse shall receive distribution of the value of the
Participant's vested interest in his Account through the purchase of an annuity
contract that provides for payment over the life of the Participant's spouse. A
Participant's spouse may elect to receive distribution under any one of the
other forms of payment available under the Plan instead of in the Qualified
Preretirement Survivor Annuity form. A married Participant who has elected to
receive distribution through the purchase of annuity contract that provides for
payment over his life may only designate a non-spouse Beneficiary to receive
distribution of his Account pursuant to a "qualified election".
A.8 Notice Regarding Forms of Payment
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The explanation provided to a Participant pursuant to Article XVI, shall include
a description of the annuity form of payment available under this Addendum,
including a written explanation of (i) the terms and conditions of the
"automatic annuity form" applicable if the Participant elects to receive
distribution through the purchase of an annuity that provides for payment over
his life, (ii) the Participant's right to choose a form of payment other than
the "automatic annuity form" or to revoke such choice, and (iii) the rights of
the Participant's spouse.
The Administrator shall provide such explanation within the 60 day period ending
30 days before the Participant's Benefit Payment Date. Notwithstanding the
foregoing, distribution of the Participant's Account may commence fewer than 30
days after such explanation is provided to the Participant if (i) the
Administrator clearly informs the Participant of his right to consider his
election of whether or not to make a direct rollover or to receive a
distribution prior to Normal Retirement Age and his election of a form of
payment for a period of at least 30 days following his receipt of the
explanation, (ii) the Participant, after receiving the explanation,
affirmatively elects an early distribution with his spouse's written consent, if
necessary, and, if the Participant has elected distribution through the purchase
of an annuity contract that provides for payment over his life, (iii) the
Participant may revoke his election at any time prior to the later of his
Benefit Payment Date or the expiration of the seven-day period beginning the day
after the date the explanation is provided to him, and (iv) distribution does
not commence to the Participant before such revocation period ends.
In addition, the Administrator shall provide a Participant who has elected
distribution through the purchase of an annuity that provides for payment over
his life with a written explanation of (i) the terms and conditions of the
Qualified Preretirement Survivor Annuity, (ii) the Participant's right to
designate a non-spouse Beneficiary to receive distribution of his Account
otherwise payable as a Qualified Preretirement Survivor Annuity or to revoke
such designation, and (iii) the rights of the Participant's spouse. The
Administrator shall provide such explanation within one of the following
periods, whichever ends last:
(a) the period beginning with the first day of the Plan Year in which the
Participant attains age 32 and ending on the last day of the Plan Year
preceding the Plan Year in which the Participant attains age 35;
(b) the period beginning 12 calendar months before the date an individual
becomes a Participant and ending 12 calendar months after such date; or
(c) provided the Participant's Account does not include assets transferred
directly from a plan subject to Code Section 417, the period beginning 12
calendar months before the date the Participant elects to receive
distribution through the purchase of an annuity contract that provides for
payment over his life and ending 12 calendar months after such date;
provided, however, that in the case of a Participant who separates from
service prior to attaining age 35, the explanation
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shall be provided to such Participant within the period beginning 12
calendar months before the Participant's separation from service and ending
12 calendar months after his separation from service.
A.9 Re-Employment
If a Participant had elected to receive distribution through the purchase of an
annuity contract that provides for payment over his life, and he returned to
employment causing the suspension of payment of his benefit, the automatic
annuity and Qualified Preretirement Survivor Annuity requirements described in
this Addendum shall continue to apply to his entire Merged Plan Account upon
subsequent termination.
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Addendum B - Merged Plan Grandfathered Features
The following Appendix details the benefits, rights and features under the
Merged Plans that are preserved in grandfathered form under this Plan, in
accordance with Code Section 411(d)(6). The features described below are
preserved only with respect to the Participant assets transferred to this Plan
on account of the merger of each applicable Merged Plan (referred to herein as
"Merged Accounts"), and are not available with respect to rollovers or other
contributions to this Plan on or after April 1, 2000. To the extent that
optional forms of annuities are available with respect to Merged Accounts, the
forms of annuities available shall be those that are stated in the applicable
Merged Plan document. Merged Accounts shall be initially invested in the
investment funds under the Plan which, in the discretion of the Sponsor, most
closely resemble the investment funds in which such accounts were invested
immediately prior to their deposit into the Plan's Trust.
1. Advent Electric Co., Inc. 401(k) Profit Sharing Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Early Retirement Age: 55 (Participant qualifies for 100% vesting in
Merged Accounts).
(ii) Normal Retirement Age: 60 (Participant qualifies for 100% vesting in
Merged Accounts).
(iii) Distribution Options:
1. Annuities
2. Installments: Periodic installments, over a period no longer
than the Participant's life or Participant's and
Beneficiary's joint life expectancy.
2. American Air Company, Inc. 401(k) Profit Sharing Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options:
1. Annuities
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2. Installments: Periodic installments, over a period no longer
than the Participant's life or Participant's and
Beneficiary's joint life expectancy.
(ii) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any amounts from his Merged Accounts.
3. Atlantic Electric Company, Inc. Plan
Reserved for future anticipated plan merger.
4. B & R Electric Co., Inc. Plan
Reserved for future anticipated plan merger.
5. Building One Mechanical/Electrical Services Corp.
Reserved for future anticipated plan merger.
6. Building One Services Corporation 401(k) Profit-Sharing Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Early Retirement Age: 60 (Participant qualifies for 100% vesting in
Merged Accounts).
(ii) Distribution Options: Annuities
(iii) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any amounts from his Merged Accounts.
7. Chambers Electronic Communications, LLC 401(k) Profit Sharing Plan and
Trust
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options:
1. Annuities
2. Installments: Periodic installments, over a period not to
exceed ten years.
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8. Crest International, Inc. 401(k) Savings and Retirement Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options: Installments: Periodic installments, over a
period not to exceed Participant's life expectancy or Participant's
and Beneficiary's joint life expectancy.
(ii) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any amounts from his Merged Accounts.
9. C.R. Hipp Construction Company Plan
Reserved for future anticipated plan merger.
10. Del-Air Services Company, Inc. Plan
Reserved for future anticipated plan merger.
11. Electronics Contracting, Inc.
Reserved for future anticipated plan merger.
12. Gamewell Mechanical 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any amounts from his Merged Accounts
attributable to elective deferrals plus income only.
13. Garfield - Indecon Electrical Services, Inc. 401(k) Retirement Savings Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
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Protected Optional Features:
(i) Distribution Options: Installments: Periodic installments, over a
period not to exceed Participant's life expectancy or Participant's
and Beneficiary's joint life expectancy.
(ii) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any vested amounts from his Merged Accounts.
14. Gulf States Group, Inc. Savings and Investment Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
No Protected Optional Features.
15. Ivey's, Inc. Salary Reduction Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options:
1. Installments: Periodic installments, over a period not to
exceed Participant's life expectancy or Participant's and
Beneficiary's joint life expectancy.
2. Annuities
16. King & Arthur Mechanical Plan
Reserved for future anticipated plan merger.
17. The Lewis Companies, Inc. 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Vesting in profit sharing account: Plan provided for 100% immediate
vesting in Profit Sharing account.
(ii) Distribution Options:
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1. Periodic installments, over a period not to exceed
Participant's life expectancy or Participant's and
Beneficiary's joint life expectancy.
2. Annuities
(iii) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any vested amounts from his Merged Accounts other
than rollovers. No rollover withdrawal feature for plan.
18. M.H. Technology, Inc. Plan
Reserved for future anticipated plan merger.
19. McIntosh Mechanical 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
No Protected Optional Features.
20. National Network Services, Inc. 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options:
1. Periodic installments, over a period no longer than the
Participant's life expectancy or Participant's and
Beneficiary's joint life expectancy.
2. Annuities
21. Omni Mechanical Services 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options: Periodic installments.
(ii) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any vested amounts from his Merged Accounts
other than rollovers. No rollover withdrawal feature for plan.
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22. Regency Electric Company 401(k) Profit Sharing Plan and Trust
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options: Periodic installments over a period not to
exceed Participant's life expectancy or Participant's and
Beneficiary's joint life expectancy.
23. Riviera Electric Construction Company 401(k) Savings & Retirement Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Normal Retirement Age: 59 1/2 or 5th anniversary of plan participation
(Participant qualifies for 100% vesting in Merged Accounts).
(ii) In-Service Withdrawal Options: Upon attainment of the later of age 59
1/2, or the fifth anniversary of plan participation, a Participant may
withdraw any vested amounts from his Merged Accounts.
24. Riviera Electric of California, Inc. 401(k) Savings & Retirement Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: Upon attainment of the later of age 65
or the fifth anniversary of plan participation, a Participant may
withdraw any vested amounts from his Merged Accounts.
25. Robinson Mechanical Company's 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options: Annuities
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26. S.L. Page Corporation Plan
Reserved for future anticipated plan merger.
27. Sanders Brothers, Inc. Employees Savings Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: Upon attainment of age 59 1/2,
Participant may withdraw any amounts from his Merged Accounts.
28. SKC Electric, Inc. Profit Sharing and 401(k) Retirement Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options:
1. Installments: Periodic installments, over a period not to
exceed the Participant's life expectancy or the
Participant's and Beneficiary's joint life expectancy.
2. Annuities
29. Spann Building Maintenance Co. 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: Upon attainment of age 65, Participant
may withdraw any amounts from his Merged Accounts.
30. Sullivan Electric, Inc.
Reserved for future anticipated plan merger.
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31. Taylor Electric Inc. Retirement & 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: Upon attainment of age 55, Participant
may withdraw any amounts from his vested Merged Accounts.
(ii) Distribution Options: Periodic installments, over a period not to
exceed the Participant's life expectancy or the Participant's and
Beneficiary's joint life expectancy.
32. Town & Country Electric, Inc. Prevailing Wage Profit-Sharing Plan & Trust
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
No Protected Optional Features.
33. Town & Country Electric, Inc. 401(k) Savings & Profit Sharing Plan & Trust
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Normal Retirement Age: Age 55. (Participant qualifies for 100% vesting
in Merged Accounts).
(ii) Distribution Options: Installments: Periodic installments, over a
period not to exceed Participant's life expectancy or Participant's
and Beneficiary's joint life expectancy.
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34. Tri-City Electrical 401(k) Retirement Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options: Annuities
35. Tri-M Corporation 401(k) Profit Sharing & Savings Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: As permitted by the plan, a Participant
may withdraw any amounts from his vested Merged Accounts that have
accumulated for 2 years.
(ii) Distribution Options: Annuities
36. Tri-State Electrical, Inc. Plan
Reserved for future anticipated plan merger.
37. United Service Solutions, Inc. 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) In-Service Withdrawal Options: Upon attainment of age 65, a
Participant may withdraw any amounts from his Merged Accounts.
38. Walter C. Davis & Son, Inc. Plan
Reserved for future anticipated plan merger.
39. Walker Engineering, Inc. Employee Savings Plan & Trust
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
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Protected Optional Features:
(i) Distribution Options: Annuities: Only available to participants who
were in the "Prior Plan."
40. Watson Electrical Construction Co. 401(k) Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
No Protected Optional Features.
41. Wilson Electric Company, Inc. Profit Sharing Plan
Merger Date: April 1, 2000 (or as soon as is administratively practicable
thereafter, in the discretion of the appropriate officers of the Sponsor).
Protected Optional Features:
(i) Distribution Options: Installments: 5 substantially equal periodic
installments.
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EXHIBIT 23.1
CONSENT OF KPMG LLP
The Board of Directors
Encompass Services Corporation:
We consent to the use of our reports incorporated herein by reference.
/s/ KPMG LLP
KPMG LLP
Houston, Texas
April 17, 2000
<PAGE>
EXHIBIT 23.2
CONSENT OF PRICEWATERHOUSECOOPERS LLP
We hereby consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated February 12, 2000, except for Notes 1
and 19, which are as of February 22, 2000, relating to the financial statements
of Building One Services Corporation, which appears in Encompass Services
Corporation's Current Report on Form 8-K/A dated April 17, 2000.
/s/ PRICEWATERHOUSECOOPERS LLP
PRICEWATERHOUSECOOPERS LLP
Minneapolis, Minnesota
April 17, 2000
<PAGE>
EXHIBIT 23.3
CONSENT OF FRAZIER & DEETER, LLC
The Board of Directors
Encompass Services Corporation
(formerly named Group Maintenance America Corp.):
We consent to the use of our reports incorporated herein by reference.
/s/ FRAZIER & DEETER, LLC
FRAZIER & DEETER, LLC
Atlanta, Georgia
April 17, 2000
<PAGE>
EXHIBIT 23.4
CONSENT OF SCHENCK & ASSOCIATES SC
The Board of Directors
Encompass Services Corporation
(formerly named Group Maintenance America Corp.):
We consent to the use of the reports of Shinners, Huchovski and Company, S.C.
incorporated herein by reference. Effective July 1, 1999, Shinners, Hucovski and
Company, S.C. merged with Schenck & Associates SC.
/s/ SCHENCK & ASSOCIATES SC
SCHENCK & ASSOCIATES SC
Green Bay, Wisconsin
April 17, 2000
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ Andrew Africk
--------------------------
Andrew Africk
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ Vincent W. Eades
--------------------------
Vincent W. Eades
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ Michael Gross
--------------------------
Michael Gross
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ William P. Love, Jr.
--------------------------
William P. Love, Jr.
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ Donald L. Luke
--------------------------
Donald L. Luke
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ Lucian L. Morrison
--------------------------
Lucian L. Morrison
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ Brooks Newmark
--------------------------
Brooks Newmark
<PAGE>
ENCOMPASS SERVICES CORPORATION
POWER OF ATTORNEY
The undersigned, in his capacity as a Director of Encompass Services
Corporation (the "Company"), does hereby appoint Gary H. Muzzy and Darren B.
Miller, and each of them, severally, his true and lawful attorneys, or attorney,
to execute in his name, place and stead, in his capacity as a Director of said
Company, a Registration Statement on Form S-8 for the registration of the
Encompass Services Corporation Employee Savings 401(k) Plan (the "Plan") and for
the registration of (i) contributions to the Plan by participating employees,
(ii) contributions made by the employers of participants in the Plan, and/or
(iii) shares of Common Stock of the Company, par value $.001 per share, that are
available for purchase by employees participating in the Plan, and any and all
amendments and post-effective amendments to said Registration Statement, and all
instruments necessary or incidental in connection therewith, and to file the
same with the Securities and Exchange Commission, granting to each of said
attorneys the full power and authority to do and perform, with or without the
other of said attorneys, in the name and on behalf of the undersigned, in any
and all capacities, every lawful act whatsoever requisite or necessary to be
done in the premises, as fully and to all intents and purposes as the
undersigned might or could in person, the undersigned hereby ratifying and
approving the lawful acts of said attorneys and each of them.
IN TESTIMONY WHEREOF, the undersigned has executed this instrument this
27th day of March, 2000.
/s/ John Sullivan
--------------------------
John Sullivan
