<PAGE>
<PAGE>
As filed with the Securities and Exchange Commission
on December 5, 1997
Registration No. 333-_____
________________________________________________________________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________________________
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
_______________________________________
UNITED TENNESSEE BANKSHARES, INC.
---------------------------------
(Exact name of registrant as specified in its charter)
Tennessee To be Applied For
- ------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) (Identification No.)
344 Broadway
Newport, Tennessee 37821-0249
(423) 623-6088
-----------------------------
(Address of Principal Executive Office)
Newport Federal Savings and Loan Association 401(k)
Retirement Plan
---------------------------------------------------
(Full title of the plan)
with copies to:
Richard Harwood, President Gary R. Bronstein, Esquire
United Bankshares, Inc. J. Mark Poerio, Esquire
344 Broadway, P. O. Box 249 K. Scott Fife, Esquire
Newport, Tennessee 37821-0249 Housley Kantarian and
- ----------------------------- Bronstein, P.C.
(Name and address of agent for 1220 19th Street, N.W.,
service) Suite 700
Washington, D.C. 20036
(423) 623-6088
- -------------------------------------------------------------
(Telephone number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
==============================================================================
<S> <C> <C> <C> <C>
Title of Proposed Maximum Proposed Maximum Amount of
Securities to Amount to be Offering Price Aggregate Offering Registration
be registered(1) registered(2) Per Share(3) Price(4) Fee
- ------------------------------------------------------------------------------------
Common Stock 73,600 $10 $736,000 $217.12
===================================================================================
<FN>
(1) In addition, pursuant to Rule 416(c) under the Securities
Act of 1933, this registration statement also covers an
indeterminate amount of interests available pursuant to the
Newport Federal Savings and Loan Association 401(k) Retirement
Plan (the "Plan"), as described herein.
(2) Estimates the maximum number of shares expected to be
issued under the Plan assuming that all employer and employee
contributions to the Plan are used to purchase shares of common
stock of United Tennessee Bankshares, Inc. in the conversion of
Newport Federal Savings and Loan Association from mutual to
stock form ("Conversion"), together with an indeterminate number
of shares which may be necessary to adjust the number of
additional shares of common stock reserved for issuance pursuant
to the Plan and being registered herein, as the result of a
stock split, stock dividend, reclassification, recapitalization
or similar adjustment(s) of the common stock of United Tennessee
Bankshares, Inc.
(3) Estimated solely for the purpose of calculating the
registration fee and calculated pursuant to Rule 457(c) based on
maximum subscription price of $10.00 per share of the common
stock of United Tennessee Bankshares, Inc., as currently offered
in the Conversion.
(4) Estimated based on (2) and (3) above.
THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
AUTOMATICALLY UPON THE DATE OF FILING, IN ACCORDANCE WITH
SECTION 8(A) OF THE SECURITIES ACT OF 1933.<PAGE>
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
ITEM 1. PLAN INFORMATION*
- ------
ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL
- ------ INFORMATION*
*This Registration Statement relates to the registration
of 73,600 shares of common stock of United Tennessee Bankshares,
Inc. (the "Company") reserved for issuance and delivery under
the Newport Federal Savings and Loan Association 401(k)
Retirement Plan (the "Plan"). Documents containing the
information required by Part I of this Registration Statement
will be sent or given to participants in the Plan as specified
by Rule 428(b)(1). Such documents are not filed with the
Securities and Exchange Commission (the "Commission") either as
part of this Registration Statement or as prospectuses or
prospectus supplements pursuant to Rule 424, in reliance on Rule
428.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
- ------
The Company became subject to the informational
requirements of the Securities Exchange Act of 1934 (the "1934
Act") on January 1, 1998 and, accordingly, will be filing
periodic reports and other information with the Commission.
Reports, proxy statements and other information concerning the
Company filed with the Commission may be inspected and copies
may be obtained (at prescribed rates) at the Commission's Public
Reference Section, Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549.
The following document filed by the Company is
incorporated in this Registration Statement by reference: the
Company's Prospectus dated November 12, 1997, filed pursuant to
Rule 424(b) (the "Prospectus") (Commission File No. 333-36465).
ALL DOCUMENTS SUBSEQUENTLY FILED BY THE COMPANY AND FOR
THE PLAN PURSUANT TO SECTIONS 13(A), 13(C), 14, AND 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, AFTER THE DATE
HEREOF AND PRIOR TO THE FILING OF A POST-EFFECTIVE AMENDMENT
WHICH INDICATES THAT ALL SECURITIES OFFERED HAVE BEEN SOLD OR
WHICH DEREGISTERS ALL SECURITIES THEN REMAINING UNSOLD SHALL BE
DEEMED TO BE INCORPORATED BY REFERENCE IN THIS REGISTRATION
STATEMENT AND TO BE A PART HEREOF FROM THE DATE OF FILING OF
SUCH DOCUMENTS.
ITEM 4. DESCRIPTION OF SECURITIES
- ------
The information required by Item 202 of Regulation S-K is
set forth in the description of the Common Stock included in the
Prospectus incorporated by reference under Item 3 hereof, such
description being incorporated by reference herein.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
- ------
Article XIII of the Charter of the Company sets forth
circumstances under which directors, officers, employees and
agents shall or may be indemnified against liability which they
incur in their capacities as follows:
<PAGE>
ARTICLE XIII - Indemnification
(A) Except as provided in Section (B) of this Article, the
Company shall indemnify a director who is made a party to any
threatened, pending, or completed action, suit or proceeding,
whether civil, criminal, administrative, or investigative
("proceeding"), because he is or was a director against
liability incurred in such proceeding if (1) he conducted
himself in good faith; (2) he reasonably believed, (a) in the
case of conduct in his official capacity with the Company, that
his conduct was in the Company's best interest and, (b) in all
other cases, that his conduct was at least not opposed to its
best interests; and, (3) in the case of any criminal proceeding,
he had no reasonable cause to believe his conduct was unlawful.
The Company shall further indemnify any director and any
officer who is not a director who was wholly successful, on the
merits or otherwise, in the defense of any proceedings to which
he was a party because he is or was a director of the Company
against reasonable expenses incurred by him in connection with
the proceeding.
<PAGE>
<PAGE>
(B) The Company shall not indemnify a director in
connection with a proceeding by or in the right of the Company
in which the director was adjudged liable to the Company or
in connection with any other proceeding charging improper
personal benefit to him, whether or not involving action in his
official capacity, in which he was adjudged liable on the basis
that personal benefit was improperly received by him.
(C) The Company may pay for or reimburse the reasonable
expenses incurred by a director who is a party to a proceeding
in advance of final disposition of the proceeding if (1)
the director furnishes the Company a written affirmation of his
good faith belief that he has met the standard of conduct set
forth in Section (A) of this Article; (2) he provides the
Company a written undertaking, executed personally or on his
behalf, to repay the advance if it is ultimately determined that
he is not entitled to indemnification; and (3) a determination
is made that the facts then known to those making the
determination would not preclude indemnification under this
Article XIII.
(D) The Company may not indemnify a director hereunder
unless authorized in the specific case after a determination has
been made that indemnification of the director is permissible in
the circumstances because he has met the standard set forth in
Section (A) of this Article XIII. The determination shall be
made:
(1) By the board of directors by majority vote of a
quorum consisting of directors not at the time parties to the
proceeding;
(2) If a quorum cannot be obtained under Subsection
(1) of this Section, by majority vote of a committee duly
designated by the board of directors (in which designation
directors who are parties may participate), consisting solely of
two or more directors not at the time parties to the proceeding;
(3) By independent special legal counsel;
(a) Selected by the board of directors or its
committee in the manner prescribed in Subsections (1)
or (2) of this Section;
(b) If a quorum of the board of directors cannot
be obtained under Subsection (1) of this Section and a
committee cannot be designated under Subsection (2) of
this Section, selected by majority vote of the full
board of directors (in which selection directors who
are parties may participate); or
(4) By the shareholders, but shares owned by or voted
under the control of directors who are at the time parties to
the proceeding may not be voted on the determination.
(E) Authorization of indemnification and evaluation that
indemnification is permissible shall be made in the same manner
as the determination that indemnification is permissible, except
that, if the determination is made by special legal counsel,
authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled
under Subsection (3) of this Section to select counsel.
(F) The Company may indemnify and advance expenses to an
officer, employee or agent of the Company who is not a director
to the same extent as a director hereunder.
(G) The Company may purchase and maintain insurance on
behalf of an individual who is or was a director, officer,
employee, or agent of the Company, or who, while a director,
officer, employee, or agent of the Company, is or was serving at
the request of the Company as a director, officer, partner,
trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, employee benefit plan
or other enterprise, against liability asserted against or
incurred by him in that capacity or arising from his status
as a director, officer, employee or agent, whether or not the
Company would have power to indemnify him against the same
liability hereunder.
Article XII of the Company's Charter eliminates directors'
liability to the Company or its stockholders as follows:
<PAGE>
<PAGE>
ARTICLE XII - ELIMINATION OF DIRECTORS' LIABILITY
Directors of the Company shall have no liability to the
Company or its shareholders for monetary damages for breach of
fiduciary duty as a director, provided that this Article XII
shall not eliminate liability of a director (A) for any breach
of the director's duty of loyalty to the Company or its
shareholders; (B) for acts or omissions that are not in good
faith or that involve intentional misconduct or a knowing
violation of law; or (C) for unlawful distributions under
Section 48-18-304 of the Tennessee Business Corporation Act.
If the Tennessee Business Corporation Act is amended to
permit further elimination or limitation of the personal
liability of directors, then the liability of directors of the
Company shall be eliminated or limited to the fullest extent
permitted by the Tennessee Business Corporation Act, as so
amended. Any repeal or modification of this Article XII or
applicable Tennessee law shall not adversely affect any right or
protection of a director of the Company existing at the time of
such repeal or modification.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
- ------
Not applicable.
ITEM 8. EXHIBITS
- ------
The exhibits schedules filed as part of this Registration
Statement are as follows:
4.1 Newport Federal Savings and Loan Association 401(k)
Retirement Plan (the "Plan"), Adoption Agreement
#001, First, Second and Third Amendments to the Plan
4.2 Summary Plan Description of the Plan
4.3 Form of Investment Election to be made available to
Plan Participants with respect to the investment of
their accounts under the Plan
5.1 Opinion of Housley Kantarian & Bronstein, P.C. as to
the validity of the Common Stock being registered
5.2 Favorable determination letter from the Internal
Revenue Service dated May 10, 1990, regarding the
tax-qualification of the Plan
23.1 Consent of Housley Kantarian & Bronstein, P.C.
(appears in their opinion filed as Exhibit 5.1)
23.2 Consent of Independent Certified Public Accountants
23.3 Consent of RP Financial, LC
24 Power of Attorney (contained in the signature page
to this Registration Statement)
99.1 Copy of the Plan's most recent Annual Report, as
filed with the Internal Revenue Service on Form 5500
ITEM 9. UNDERTAKINGS
- ------
1. The undersigned registrant hereby undertakes:
(a) To file, during any period in which offers or
sales are being made, a post-effective amendment to this
registration statement --
(i) To include any prospectus required by
Section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of 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. Notwithstanding the foregoing, any increase or
decrease in volume of securities offered (if the total dollar
value of securities offered would not exceed that which
<PAGE>
<PAGE>
was registered) and any deviation from the low or high and of
the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(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 (a)(i) and (a)(ii) do not
apply if the registration statement is on Form S-3, Form S-8 or
Form F-3, and the information required to be included in a post-
effective amendment by those paragraphs is contained in periodic
reports filed with or furnished to the Commission by the
registrant pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the
registration statement.
(b) That, for the purpose of determining any
liability under the Securities Act of 1933, each such
post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered
therein, and the offering of the securities at that
time shall be deemed to be the initial bona fide offering
thereof.
(c) To remove from registration by means of a
post-effective amendment any of the securities being registered
which remain unsold at the termination of the offering.
(d) If the registrant is a foreign private issuer, to
file a post-effective amendment to the registration statement to
include any financial statements required by Rule 3-19 of this
chapter at the start of any delayed offering or throughout a
continuous offering. Financial statements and information
otherwise required by Section 10(a)(3) of the Act need
not be furnished, provided, that the registrant includes in the
prospectus, by means of a post-effective amendment, financial
statements required pursuant to this paragraph and other
information necessary to ensure that all other information in
the prospectus is at least as current as the date of those
financial statements. Notwithstanding the foregoing, with
respect to registration statements on Form F-3, a post-effective
amendment need not be filed to include financial statements and
information required by Section 10(a)(3) of the Act or Rule 3-19
of this chapter if such financial statements and information are
contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Form F-3.
2. The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act
of 1933, each filing of the registrant's annual report pursuant
to Section 13(a) or 15(d) of the Securities Exchange Act of 1934
(and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
3. The undersigned registrant hereby undertakes to
deliver or cause to be delivered with the prospectus, to each
person to whom the prospectus is sent or given, the latest
annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and
meeting the requirements of Rule 14a-3 or Rule 14c-3 under the
Securities Exchange Act of 1934; and, where interim financial
information required to be presented by Article 3 of Regulation
S-X are not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is
sent or given, the latest quarterly report that is specifically
incorporated by reference in the prospectus to provide such
interim financial information.
4. Insofar as indemnification for liabilities arising
under the Securities Act of 1933 may be permitted to directors,
officers and controlling persons of the registrant pursuant
to the foregoing provisions, or otherwise, the registrant has
been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities
(other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue. <PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of
1933, as amended, the registrant certifies that it has
reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this
Registration Statement to be signed on its behalf by the
undersigned thereunto duly authorized, in the City of Newport,
State of Tennessee, on December 4, 1997.
UNITED TENNESSEE BANKSHARES, INC.
By /s/ Richard G. Harwood
----------------------------
Richard G. Harwood
President and Chief Executive Officer
(Duly Authorized Representative)
We, the undersigned Directors of United Tennessee
Bankshares, Inc., hereby severally constitute and appoint
Richard G. Harwood, with full power of substitution, our true
and lawful attorney and agent, to do any and all things in our
names in the capacity indicated below which said Richard G.
Harwood may deem necessary or advisable to enable United
Tennessee Bankshares, Inc. to comply with Securities Act of
1933, as amended, and any rules, regulations and requirements of
the Securities and Exchange Commission, in connection with the
registration of United Tennessee Bankshares, Inc. common stock,
including specifically, but not limited to, power and authority
to sign for us in our names in the capacities indicated below,
the Registration Statement and any and all amendments (including
post-effective amendments) thereto; and we hereby ratify and
confirm all that said Richard G. Harwood shall do or cause to be
done by virtue thereof.
Pursuant to the requirements of the Securities Act
of 1933, this Registration Statement has been signed by the
following persons in the capacities and on the dates indicated.
</TABLE>
<TABLE>
<CAPTION>
Signatures Title Date
- ---------- ----- -----
<S> <C> <C>
/s/Richard G. Harwood President, Chief Executive Officer
- --------------------- and Director December 4, 1997
Richard G. Harwood (Principal Executive, Financial,
and Accounting Officer)
/s/ J. William Myers Chairman of the Board December 4, 1997
- -------------------- Director
J. William Myers
/s/ Clyde E. Driskill, Jr. Director December 4, 1997
- -------------------------
Clyde E. Driskill, Jr.
/s/ William B. Henry Director December 4, 1997
- --------------------
William B. Henry
/s/ Robert L. Overholt Director December 4, 1997
- ----------------------
Robert L. Overholt
/s/ Robert D. Self Director December 4, 1997
- ------------------
Robert D. Self
</TABLE>
<PAGE>
Pursuant to the requirements of the Securities Act of 1933,
the undersigned trustee of the Newport Federal Savings and Loan
Association 401(k) Retirement Plan has duly caused this
Registration Statement to be signed in the City of Newport,
State of Tennessee, on December 4, 1997.
Home Federal Bank of Tennessee,
as Trustee of The Newport
Federal Savings And Loan Association 401(k)
Retirement Plan
By /s/ William B. McGhee
-----------------------------
Its Assistant Vice President
----------------------------
<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit Description
- ------- -----------
4.1 Newport Federal Savings and Loan Association
401(k) Retirement Plan (the "Plan"), Adoption
Agreement #001, First, Second and Third Amendments
to the Plan
4.2 Summary Plan Description of the Plan
4.3 Form of Investment Election to be made available
to Plan Participants with respect to the
investment of their accounts under the Plan
5.1 Opinion of Housley Kantarian & Bronstein, P.C. as
to the validity of the Common Stock being
registered
5.2 Favorable determination letter from the Internal
Revenue Service dated May 10, 1990, regarding the
tax-qualification of the Plan
23.1 Consent of Housley Kantarian & Bronstein, P.C.
(appears in their opinion filed as Exhibit 5.1)
23.2 Consent of Independent Certified Public
Accountants
23.3 Consent of RP Financial, LC
24 Power of Attorney (contained in the signature page
to this Registration Statement)
99.1 Copy of the Plan's most recent Annual Report, as
filed with the Internal Revenue Service on Form
5500
December 4, 1997
Board of Directors
United Tennessee Bankshares, Inc.
344 Broadway, P. O. Box 249
Newport, Tennessee 37821-0249
Re: Registration Statement on Form S-8
---------------------------------------------------
Newport Federal Savings and Loan Association 401(k)
Retirement Plan
Dear Board Members:
We have acted as special counsel to United Tennessee
Bankshares, Inc. (the "Company"), a Tennessee corporation, in
connection with the preparation of the above-referenced
Registration Statement (the "Registration Statement") being
filed herewith under the Securities Act of 1933, as amended,
relating to participation interests in the Newport Federal
Savings and Loan Association 401(k) Retirement Plan (the "Plan")
and the sale to Plan participants of 73,600 shares of common
stock (the "Common Stock") of the Company, all as more fully
described in the Registration Statement. You have requested
the opinion of this firm with respect to certain legal aspects
of the proposed offering.
We have examined such documents, records and matters of law
as we have deemed necessary for purposes of this opinion and
based thereon, we are of the opinion that the Common Stock when
issued will be duly and validly issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement on Form S-8 and to
references to our firm included under the caption "Legal
Opinion" in the Prospectus which is part of the Registration
Statement.
Very truly yours,
Housley Kantarian & Bronstein, P.C.
By: /s/ J. Mark Poerio
----------------------------
J. Mark Poerio, Esquire
CONSENT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
United Tennessee Bankshares, Inc.
We consent to the incorporation by reference in this
registration statement of United Tennessee Bankshares, Inc. on
Form S-8, regarding Newport Federal Savings and Loan Association
401(k) Retirement Plan, of our report dated January 17, 1997, on
our audits of the consolidated financial statements of Newport
Federal Savings and Loan Association as of December 31, 1996 and
1995, and for each of the years in the three year period ended
December 31, 1996, which report was included in the Prospectus
for the common stock of United Tennessee Bankshares, Inc. and
incorporated by reference herein. We also consent to the
reference to our firm under the caption "Experts".
/s/ Pugh & Company, P.C.
Certified Public Accountants
December 3, 1997
December 4, 1997
Board of Directors
Newport Federal Savings and Loan Association
344 West Broadway
Newport, Tennessee 37821
Gentlemen:
We hereby consent to the use of our firm's name
incorporated by reference in the Form S-8 Registration Statement
for United Tennessee Bankshares, Inc. and any amendments
thereto. We also hereby consent to the inclusion of, summary of
and references to our Appraisal Report and our statement
concerning subscription rights incorporated by reference in such
filing.
Very truly yours,
RP FINANCIAL, L.C.
/s/ James J. Oren
James J. Oren
Vice President
<PAGE>
[ L O G O]
Newport Federal
Savings and Loan Association
401(K) Retirement Plan
Successor Trustee:
Home Federal Bank of Tennessee
Trust Department
Effective Date:
March 7, 1997
Trust Department
515 Market Street
Suite 500
Knoxville, Tennessee 37902
Phone (423) 544-3912
<PAGE>
<PAGE>
HOME FEDERAL BANK OF TENNESSEE, FSB
PROTOTYPE DEFINED CONTRIBUTION PLAN AND TRUST
Home Federal Bank of Tennessee, FSB hereby establishes this
Prototype Plan and Trust for Employers wishing to establish or
continue to maintain profit sharing or money purchase pension
plans.
An Employer may adopt this Prototype Plan as part of its
Plan by completing and signing an Adoption Agreement, which
adoption shall be effective when executed by the Trustee.
<PAGE>
<PAGE>
TABLE OF CONTENTS
ARTICLE TITLE PAGE
1 PURPOSE OF PLAN AND TRUST AND
IMPLEMENTING PROVISIONS
1.01 Purpose 1 - 1
1.02 Tax Aspects 1 - 1
1.03 Adoption Agreement 1 - 1
2 DEFINITIONS 2 - 1
3 ELIGIBILITY AND PARTICIPATION
3.01 Eligibility 3 - 1
3.02 Participation 3 - 1
3.03 Return on Eligible Class 3 - 2
3.04 Transfers Among Adopting Employers
Which are Controlled Group Members 3 - 2
3.05 Controlled Trades or Businesses 3 - 2
3.06 Acceptance 3 - 2
4 CONTRIBUTIONS
4.01 Employer Contributions 4 - 1
4.02 Employee Contributions 4 - 1
4.03 Elective Deferrals 4 - 2
4.04 Rollover Contributions 4 - 2
4.05 Trustee-To-Trustee Transfers 4 - 3
4.06 Prohibition of Reversion 4 - 4
5 PARTICIPANTS' ACCOUNTS
5.01 Establishment of Participants' Accounts 5 - 1
5.02 Valuation of Trust Fund 5 - 2
5.03 Allocation of Employer Contributions 5 - 2
5.04 Forfeitures 5 - 4
5.05 Trust Earnings and Losses 5 - 4
5.06 Inactive Participants 5 - 5
5.07 Limitations on Allocations 5 - 5
5.08 Participant-Directed Investments 5 - 13
<PAGE>
<PAGE>
6 CASH OR DEFERRED ARRANGEMENT
6.01 Salary Reduction Agreement 6 - 1
6.02 Annual Limit on Elective Deferrals 6 - 2
6.03 Distribution of Excess Elective Deferrals 6 - 2
6.04 Actual Deferral Percentage Test 6 - 3
6.05 Distribution of Excess Contributions 6 - 5
6.06 Recharacterization 6 - 6
6.07 Voluntary Non-deductible Contributions 6 - 7
6.08 Matching Contributions 6 - 7
6.09 Forfeitures and Vesting of Matching
Contributions 6 - 7
6.10 Qualified Matching Contributions 6 - 7
6.11 Limitations on Employee Contributions
and Matching Contributions 6 - 8
6.12 Distribution of Excess Aggregate
Contributions 6 - 11
6.13 Qualified Non-elective Contributions 6 - 12
6.14 Nonforfeitability and Vesting 6 - 13
6.15 Distribution Requirements 6 - 13
6.16 Hardship Distribution 6 - 14
6.17 Top-Heavy Requirements 6 - 14
7 RETIREMENT BENEFITS
7.01 Normal Retirement 7 - 1
7.02 Early Retirement 7 - 1
7.03 Disability Retirement 7 - 1
8 DEATH BENEFITS
8.01 Death Benefit 8 - 1
8.02 Insured Death Benefit 8 - 1
9 BENEFITS ON SEPARATION FROM SERVICE
9.01 Vested Benefit 9 - 1
9.02 Forfeitures 9 - 1
<PAGE>
<PAGE>
10 PAYMENT OF BENEFITS
10.01 Payment of Benefits 10 - 1
10.02 Time of Payment 10 - 1
10.03 Restrictions on Immediate Distribution 10 - 2
10.04 Termination of Employment Prior to
Early Retirement 10 - 3
10.05 Withdrawal from Employer Account
(Non-Integrated Profit-Sharing
Plans Only) 10 - 4
10.06 Distribution Requirements 10 - 5
10.07 Required Beginning Date 10 - 6
10.08 Limits on Distribution Periods 10 - 6
10.09 Determination of Amount to be
Distributed Each Year 10 - 6
10.10 Death Distribution Provisions 10 - 7
10.11 Definitions 10 - 9
10.12 Transitional Rule 10 - 11
10.13 Failure to Locate 10 - 12
10.14 Premature Distributions 10 - 13
11 JOINT AND SURVIVOR ANNUITY REQUIREMENTS
11.01 Controlling Article 11 - 1
11.02 Qualified Joint and Survivor Annuity 11 - 1
11.03 Qualified Pre-Retirement Survivor Annuity11 - 1
11.04 Definitions 11 - 1
11.05 Notice Requirements 11 - 3
11.06 Safe Harbor Rules 11 - 5
11.07 Transitional Rules 11 - 5
12 LOANS 12 - 1
13 TOP-HEAVY PLANS
13.01 Definitions 13 - 1
13.02 Minimum Allocation 13 - 4
13.03 Minimum Vesting Schedule 13 - 5
13.04 Special Limitations on Top Heavy
Allocations in Multiple Plans:
"Code Section 415(e) Buy-Back" 13 - 5
<PAGE>
<PAGE>
14 PAIRED PLANS
14.01 Paired Plans 14 - 1
14.02 Multiple Benefits from Super Top
Heavy Paired Plans 14 - 1
14.03 Minimum Defined Contribution Plan
Allocations Under Top Heavy Paired
Plans with Code Section 415(e)
Buy-Back 14 - 1
14.04 Minimum Defined Contribution Plan
Allocations Under Super Top Heavy
Paired Plans or Without Code
Section 415(e) Buy-Back 14 - 2
14.05 Defined Contribution Paired Plan
Prevention of Duplication of
Allocations 14 - 2
14.06 Forfeitures in Profit-Sharing Plans 14 - 3
14.07 Integrated Paired Plans 14 - 3
15 PLAN ADMINISTRATOR
15.01 Administrator 15 - 1
15.02 Claims Procedure 15 - 2
15.03 Records 15 - 3
15.04 Delegation of Authority 15 - 3
15.05 Correction of Errors 15 - 4
15.06 Domestic Relations Orders 15 - 4
16 THE TRUST
16.01 The Trust 16 - 1
16.02 Contributions to Trustee 16 - 1
16.03 Investment Powers 16 - 1
16.04 Appointment of Investment Manager 16 - 3
16.05 Employer-Directed Investments 16 - 5
16.06 Insurance Contracts 16 - 5
16.07 Custodial Role 16 - 6
16.08 Liability of Trustee 16 - 6
16.09 Court Actions 16 - 6
16.10 Prudent Man Rule 16 - 6
16.11 Prohibited Transactions 16 - 7
16.12 Conflict of Interest 16 - 7
16.13 Exemptions 16 - 7
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<PAGE>
16.14 Insurance 16 - 7
16.15 Accounts 16 - 8
16.16 Reports 16 - 8
16.17 Payments 16 - 8
16.18 Direction of Committee 16 - 9
16.19 Impossibility of Performance 16 - 9
16.20 Expenses 16 - 9
16.21 Taxes 16 - 9
16.22 Resignation or Removal of Trustee 16 - 10
16.23 Transfer of Assets to a Successor
Trustee or Other Medium of Funding 16 - 10
16.24 Assets of Controlled Group Members 16 - 11
17 AMENDMENT OR TERMINATION
17.01 Employer's Right to Amend Plan 17 - 1
17.02 Sponsor's Right to Amend Plan 17 - 2
17.03 Limitation of Right to Amend 17 - 2
17.04 Termination of Plan by Employer 17 - 2
17.05 Sponsor's Withdrawals of
Participation in Master Plan 17 - 3
17.06 Failure of Qualification 17 - 3
17.07 Mergers 17 - 3
18 MISCELLANEOUS
18.01 Liability of Employer 18 - 1
18.02 Spendthrift Clause 18 - 1
18.03 Successor Business of Employer 18 - 1
18.04 Qualification by the Internal
Revenue Service 18 - 2
18.05 Use Limited to Qualified Trusts 18 - 2
18.06 Conflict of Provisions 18 - 2
18.07 Definition of Words 18 - 2
18.08 Titles 18 - 3
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<PAGE>
ARTICLE 1
---------
PURPOSE OF PLAN AND TRUST AND IMPLEMENTING PROVISIONS
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1.01 Purpose.
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The purpose of this Plan and Trust is to enable the
Employer to establish or continue a defined contribution plan
for its employees.
1.02 Tax Aspects.
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It is the intent of the Sponsor in establishing this
Plan and Trust that it qualify and remain qualified under
Sections 401(a) and 501(a) of the Internal Revenue Code of 1986,
as amended. However, in the event that the Trust hereunder
after once having been qualified, fails to retain qualification,
the provisions of Section 17.06 hereof shall be applicable as of
the date said Trust is no longer qualified.
1.03 Adoption Agreement.
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For purposes of facilitating the creation of this Plan
and Trust under procedures promulgated by the Internal Revenue
Service for establishing a variable form master defined
contribution plan and trust, the Adoption Agreement executed by
the Employer and the Trustee is hereby made a part hereof by
reference as if fully set forth herein, and the definitions and
provisions thereof elected by the Employer shall be applicable
to the Plan and Trust of the Employer.
1 - 1<PAGE>
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ARTICLE 2
---------
DEFINITIONS
-----------
Unless otherwise explicitly specified, the following words and
phrases as used herein shall have the meanings set forth below
and shall be interpreted as stated in this ARTICLE.
2.01 "Account or Accounts" shall mean a Participant's
Employer Contributions Accounts, Voluntary Contributions
Account, Deductible Contributions Account, Elective Deferral
Account, Rollover Account, Trustee-to-Trustee Transfer Account
and Participant-Directed Investment Account, as described in
Section 5.01.
2.02 "Accumulated Net Profits" shall mean that part of the
surplus of the Employer derived from Net Profits and retained
from time to time by the Employer.
2.03 "Administrator" shall mean, with respect to the Plan,
the party to which the Employer shall delegate its
administrative duties and responsibilities in accordance with
ARTICLE 15 of the Plan and Section 3 of the Adoption Agreement.
If the Employer does not delegate its administrative duties and
responsibilities, the Employer shall be the Administrator.
2.04 "Adoption Agreement" shall mean the instrument by
which the Employer elects to establish or continue its Plan by
adoption of this prototype plan document.
2.05 "Allocation Date" shall mean the last day of each
Plan Year. The Employer may establish such other Allocation
Dates during a Plan Year; provided, however, that the use of
more than one Allocation Date during a Plan Year shall not be
applied so as to result in discrimination in favor of Employees
who are officers, shareholders or highly compensated.
2.06 "Anniversary Date" shall mean the first day of a Plan
Year.
2.07 "Beneficiary" shall mean the recipient or recipients
last designated by the Participant in writing on forms provided
by the Employer who shall receive any benefits payable under the
Plan upon the death of such Participant, subject, however, to
the requirements of ARTICLES 8 and 11. If no such designation
of Beneficiary has been received by the Employer prior to the
date of death of the Participant, then such benefit shall be
payable to the estate of the Participants.
2.08 "Board" shall mean the board of directors of the
Employer.
2 - 1<PAGE>
<PAGE>
2.09 "Break in Service" shall mean a twelve (12)
consecutive month period during which an Employee has not been
credited with more than five hundred (500) Hours of Service.
For eligibility purposes, the period shall mean the Eligibility
Computation Period. For purposes of computing an Employee's
nonforfeitable right to the Account balance derived from
Employer Contributions, Breaks in Service will be measured by
the twelve (12) consecutive month period designated by the
Employer in Section 11(b) of the Adoption Agreement.
2.10 "CODA" shall mean a qualified cash or deferred
arrangement as described in Section 401(k) of the Code, ARTICLE
VI of the Plan, and Section 24 of the profit sharing plan
Adoption Agreement.
2.11 "Code" shall mean the Internal Revenue Code of 1986,
as amended.
2.12 "Committee" shall mean the committee to which the
Employer may delegate its administrative duties and
responsibilities in accordance with ARTICLE 15.
2.13 "Compensation" shall mean, as elected by the Employer
in Section 9 of the Adoption Agreement, all of each
Participant's (a) W-2 earnings or (b) compensation as that term
is defined in Section 415(c)(3) of the Code. For any Self-
Employed Individual covered under the Plan, Compensation will
mean Earned Income. Compensation shall include only that
Compensation which is actually paid to the Participant during
the applicable period. Except as provided elsewhere in this
Plan, the applicable period shall be the period elected by the
Employer in Section 9 of the Adoption Agreement. If the
Employer makes no election, the applicable period shall be the
Plan Year.
Notwithstanding the above, if elected by the Employer
in the Adoption Agreement, Compensation shall include any amount
which is contributed by the Employer pursuant to a salary
reduction agreement which is not includible in the gross income
of the Employee under Section 125, 402(a)(8), 402(h) or 403(b)
of the Code.
The annual Compensation of each Participant taken into
account under the Plan for any Year shall not exceed $200,000,
as adjusted by the Secretary at the same time and in the same
manner as under Section 415(d) of the Code. In determining the
Compensation of a Participant for purposes of this limitation,
the rules of Section 414(q)(6) of the Code shall apply, except
in applying such rules, the term "family" shall include only the
Spouse of the Participant and any lineal descendants of the
Participant who have not attained age nineteen (19) before the
close of the year.
2 - 2<PAGE>
<PAGE>
If, as a result of the application of such rules the
adjusted $200,000 limitation is exceeded, then (except for
purposes of determining the portion of Compensation up to the
integration level if this Plan provides for permitted
disparity), the limitation shall be prorated among the affected
individuals in proportion to each such individual's Compensation
as determined under this Section prior to the application of
this limitation.
2.14 "Controlled Group Member" shall mean, except as
modified in Section 5.07(f)(vi), as follows: (a) any
corporation which is a member of a controlled group of
corporations (as defined in Section 414(b) of the Code) of which
the Employer is a member, (b) any organization which is a member
of a group of trades or businesses (whether or not incorporated)
which is under common control with respect to the Employer (as
defined in Section 414(c) of the Code), (c) any organization
which is a member of an affiliated service group (as defined by
Section 414(m) of the Code), or (d) any other entity required to
be aggregated with the Employer pursuant to Section 414(o) of
the Code and the regulations thereunder; but only for the period
during which such other corporation, trade or business,
organization or entity and the Employer are members of such
controlled group of corporations, are under such common control,
are serving as such affiliated service group or are required to
be aggregated. All employees of Controlled Group Members shall
be treated as employed by a single employer.
2.15 "Disability" shall mean the inability to engage in
any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected
to result in death or which has lasted or can be expected to
last for a continuous period of not less than twelve (12)
months. The permanence and degree of such impairment shall be
supported by medical evidence. If elected by the Employer in
Section 8 of the Adoption Agreement, nonforfeitable
contributions will be made to the Plan on behalf of each
disabled Participant who is not a Highly Compensation Employee
(within the meaning of Section 414(q) of the Code).
2.16 "Early Retirement Age" shall mean the age selected in
Section 13(b) of the Adoption Agreement, at which time a
Participant shall be entitled to receive an Early Retirement
Benefit.
2.17 "Early Retirement Benefit" shall mean the benefit to
which a Participant in entitled at his Early Retirement Date.
2.18 "Early Retirement Date" shall mean the date the
Participant attains his Early Retirement Age and is fully vested
pursuant to Section 9.01 of the Plan and Section 11 of the
Adoption Agreement.
2 - 3<PAGE>
<PAGE>
2.19 "Earned Income" shall mean the net earnings from
self-employment in the trade or business with respect to which
the Plan is established, for which personal services of the
individual are a material income-producing factor. Net earnings
shall be determined without regard to items not included in
gross income and the deductions allocable to such items. Net
earnings are reduced by contributions by the Employer to a
qualified plan to the extent deductible under Section 404 of the
Code. Net earnings shall be determined with regard to the
deduction allowed to the Employer by Section 164(f) of the Code
for taxable years beginning after December 31, 1989.
2.20 "Effective Date" shall mean, as to the Employer, the
Effective Date of the Plan as specified in Section 1(b) of the
Adoption Agreement.
2.21 "Elective Deferrals" shall mean contributions made at
the election of the Participant by the Employer pursuant to
ARTICLE 6 of the Plan.
2.22 "Eligibility Computation Period" shall mean, for
purposes of determining Years of Service and Breaks in Service
for purposes of eligibility, the following:
(a) The initial Eligibility Computation Period is
the twelve (12) consecutive month period beginning on the
Employment Commencement Date.
(b) The succeeding twelve (12) consecutive month
periods shall commence on one of the following dates, as elected
by the Employer in Section 5 of the Adoption Agreement:
(i) The first anniversary of the Employee's
Employment Commencement Date; or
(ii) The first Plan Year which commences prior to
the first anniversary of the Employee's Employment
Commencement Date regardless of whether the Employee is
entitled to be credited with one thousand (1,000) Hours of
Service during the initial Eligibility Computation Period.
An Employee who is credited with one thousand (1,000) Hours
of Service in both the initial Eligibility Computation Period
and the first Plan Year which commences prior to the first
anniversary of the Employee's initial Eligibility Computation
Period will be credited with two (2) Years of Service for
purposes of eligibility to participate.
Years of Service and Breaks in Service will be measured on the
same Eligibility Computation Period.
2 - 4<PAGE>
<PAGE>
2.23 "Employee" shall mean any employee of the Employer
maintaining the Plan or of any other employer required to be
aggregated with the Employer under Section 414(b), (c), (m) or
(o) of the Code. The term Employee shall also include any
Leased Employee deemed to be an employee of any employer
described in the preceding sentence as provided in Section
414(n) or (o) of the Code. For purposes of this Section,
Employee shall also include an Owner-Employee or Self-Employed
Individual. An individual who is classified in one or more of
the categories specifically excluded in Section 4 of the
Adoption Agreement shall not be defined as an Employee for
purposes of the Plan unless and until he ceases to be so
classified; provided, however, that any such excluded individual
shall be credited with Hours of Service hereunder during the
period he is excluded for purposes of determining his Years of
Vesting Service and the time of his participation in the Plan in
the event he ceases to be so classified.
2.24 "Employee Contributions" shall mean contributions
made by the Employee pursuant to Section 4.02 of the Plan and
Section 10 of the Adoption Agreement.
2.25 "Employer" shall mean that business organization, its
predecessors (if, and to the extent, Years of Service thereunder
is to be included pursuant to Section 2.62 of the Plan and
Section 12 of the Adoption Agreement), successors and/or
assigns, which have duly executed an Adoption Agreement. The
Employer also includes any Controlled Group Member that adopts
the Plan as provided in Section 23 of the Adoption Agreement.
2.26 "Employer Contributions" shall mean contributions
made by the Employer pursuant to Section 4.01 of the Plan and
Section 7 of the Adoption Agreement.
2.27 "Employment Commencement Date" shall mean the date on
which an Employee first performs an Hour of Service.
2.28 "Entry Date" shall mean the date on which an Employee
enters the Plan pursuant to Section 5(d) of the Adoption
Agreement.
2.29 "ERISA" shall mean Public Law 93-406, popularly known
as the Employee Retirement Income Security Act, as amended.
2.30 "Five-Percent Owner" shall mean any person who owns
(or is considered as owning within the meaning of Section 318 of
the Code) more than five (5) percent of the outstanding stock of
a corporate Employer or stock possessing more than five (5)
percent of the total combined voting power of all stock of the
Employer or more than five (5) percent of the interest in the
non-corporate Employer.
2 - 5<PAGE>
<PAGE>
2.31 "Forfeiture" shall mean the non-vested portion of a
Participant's Employer Contributions Account which is forfeited
pursuant to Sections 5.04 and 9.02.
2.32 "Highly Compensated Employee" shall mean any
Employee who performs Service for the Employer during the
determination year and who, during the look-back year: (a)
received Compensation from the Employer in excess of $75,000 (as
adjusted pursuant to Section 415(d) of the Code); (b) received
Compensation from the Employer in excess of $50,000 (as adjusted
pursuant to Section 415(d) of the Code) and was a member of the
top-paid group for such year; or (c) was an officer of the
Employer and received Compensation during such year that is
greater than fifty (50) percent of the dollar limitation in
effect under Section 415(b)(1)(A) of the Code. The term Highly
Compensated Employee also includes: (i) Employees who are both
described in the preceding sentence if the term "determination
year" is substituted for the term "look-back year" and the
Employee is one of the one hundred (100) Employees who received
the most Compensation from the Employer during the determination
year; and (ii) Employees who are Five-Percent Owners at any time
during the look-back year or determination year.
If no officer has satisfied the Compensation requirement of
(c) above during either a determination year or look-back year,
the highest paid officer for such year shall be treated as a
Highly Compensated Employee.
For this purpose, the determination year shall be the Plan
Year. The look-back year shall be the twelve-month period
immediately preceding the determination year.
A Highly Compensated Employee includes any Employee whose
Termination of Employment occurred (or who was deemed to have
incurred a Termination of Employment) prior to the determination
year, performs no Service for the Employer during the
determination year, and was a Highly Compensated active Employee
for either the Termination year or any determination year ending
on or after the Employee's 55th birthday.
If an Employee is, during a determination year or look-back
year, a Family Member of either a Five-Percent Owner who is an
active or former Employee or a Highly Compensated Employee who
is one of the ten (10) most highly compensated Employees ranked
on the basis of Compensation paid by the Employer during such
year, then the Family Member and the Five-Percent Owner or top-
ten Highly Compensated Employee shall be aggregated. In such
case, the Family Member and Five-Percent Owner or top-ten Highly
Compensated Employee shall be treated an a single Employee
receiving Compensation and Plan contributions or benefits equal
to the sum of such Compensation and contributions or benefits of
the Family Member and Five-Percent Owner or top-ten Highly
2 - 6<PAGE>
<PAGE>
Compensated Employee. For purposes of this Section, Family
Member includes the Spouse, lineal ascendants and descendants of
the Employee or former Employee and the spouses Of such lineal
ascendants and descendants.
The determination of who is a Highly Compensated Employee,
including the determinations of the number and identity of
Employees in the top-paid group, the top one hundred (100)
Employees, the number of Employees treated as officers and the
Compensation that is considered, will be made in accordance with
Section 414(q) of the Code and the regulations thereunder.
2.33 "Hour of Service" shall mean the following:
(a) Each hour for which an Employee is paid, or
entitled to payment, for the performance of duties for the
Employer and/or a Controlled Group Member. These Hours will be
credited to the Employee for the computation period in which the
duties are performed.
(b) Each hour for which an Employee is paid, or
entitled to payment, by the Employer and/or a Controlled Group
Member on account of a period of time during which no duties
were performed (irrespective of whether the employment
relationship has terminated) due to vacation, holiday, illness,
incapacity (including Disability), layoff, jury duty, military
duty or leave of absence. No more than five hundred one (501)
Hours of Service shall be credited under this subsection (b) for
any single continuous period (whether or not such period occurs
in a single computation period). Hours under this subsection
(b) will be calculated and credited pursuant to Section
2530.200b-2 of the Department of Labor Regulations which is
incorporated herein by this reference.
(c) Each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by the
Employer. The same hours shall not be credited both under
subsection (a) or (b) and under this subsection (c). These
hours shall be credited to the Employee for the computation
period or periods to which the award or agreement pertains
rather than the computation period in which the award, agreement
or payment is made.
Hours of Service will be credited for employment with
Controlled Group Members.
Hours of Service will also be credited for any
individual considered an Employee for purposes of this Plan
under Section 414(n) or (o) of the Code and the regulations
thereunder.
2 - 7<PAGE>
<PAGE>
Solely for purposes of determining whether a Break
in Service for participation and vesting purposes has occurred
in a computation period, an individual who is absent from work
for maternity or paternity reasons or is on an authorized leave
of absence (defined below) shall receive credit for the Hours of
Service which would otherwise have been credited to such
individual but for such absence, or in any case in which such
hours cannot be determined, eight (8) Hours of Service per day
of such absence. For purposes of this paragraph, an absence
from work for maternity or paternity reasons means an absence
(i) by reason of the pregnancy of the individual, (ii) by reason
of a birth of a child of the individual, (iii) by reason of the
placement of a child with the individual in connection with the
adoption of such child by such individual, or (iv) for purposes
of caring for such child for a period beginning immediately
following such birth or placement. An "authorized leave of
absence" means any unpaid absence authorized by the Employer
under the Employer's standard personnel practices, provided that
all persons under similar circumstances must be treated alike in
the granting of such Authorized Leaves of Absence. An absence
due to service in the Armed Forces of the United States shall be
considered an authorized leave of absence provided that the
absence is caused by war or other emergency, or provided that
the Employee is required to serve under the laws of conscription
in time of peace. The Hours of Service credited under this
paragraph for maternity or paternity reasons will be credited
(1) in the computation period in which the absence begins if the
crediting is necessary to prevent a Break in Service in that
period, or (2) in all other cases, in the following computation
period.
Hours of Service shall be determined on the basis of
the method selected in Section 6 of the Adoption Agreement.
2.34 "Inactive Participant" shall mean a Participant (or
former Participant who has a balance remaining in his Accounts)
who is not entitled to share in the allocation of Employer
Contributions because the Participant is excluded pursuant to
the option selected in Section 7(a) of the money purchase
pension plan Adoption Agreement or Section 8(a) of the profit
sharing plan Adoption Agreement.
2.35 "Investment Manager" shall mean:
(a) a registered investment advisor under the
Investment Advisors Act of 1940, a bank as defined in that Act
or an insurance company that:
(i) is qualified to perform services
relating to the management, acquisition or disposition of
Plan assets, and
2 - 8<PAGE>
<PAGE>
(ii) has acknowledged fiduciary responsibility
to the Plan in writing; or
(b) a bank or trust company that is subject to
supervision by the United States or a State, a broker or dealer
registered under the Securities Exchange Act of 1934 or a
"leasing agency" as defined in Section 3(a)(23) of the
Securities Exchange Act of 1934, or a nominee of such bank,
trust company, broker or dealer, or clearing agency.
2.36 "Leased Employee" shall mean any person (other than
an employee of the recipient) who pursuant to an agreement
between the recipient and any other person ("leasing
organization") has performed services for the recipient (or for
the recipient and related persons determined in accordance with
Section 414(n)(6) of the Code) on a substantially full time
basis for a period of at least one (1) year, and such services
are of a type historically performed by employees in the
business field of the recipient employer. Contributions or
benefits provided a Leased Employee by the leasing organization
which are attributable to services performed for the recipient
employer shall be treated as provided by the recipient employer.
A Leased Employee shall not be considered an employee of the
recipient if: (a) such employee is covered by a money purchase
pension plan providing: (i) a nonintegrated employer
contribution rate of at least ten (10) percent of compensation,
as defined in Section 415(c)(3) of the Code, but including
amounts contributed pursuant to a salary reduction agreement
which are excludible from the employee's gross income under
Section 125, 402(a)(8), 402(h) or 403(b) of the Code, (ii)
immediate participation, and (iii) full and immediate vesting;
and (b) Leased Employees do not constitute more than twenty (20)
percent of the recipient's non-highly compensated workforce.
2.37 "Net Profits" shall mean the Net Profits of the
Employer as defined in Section 7 of the Adoption Agreement (for
Profit-Sharing Plans).
2.38 "Normal Retirement Age" shall mean the age selected
in Section 13 of the Adoption Agreement, at which time a
Participant shall be entitled to receive a Normal Retirement
Benefit. If the Employer enforces a mandatory retirement age,
the Normal Retirement Age in the lesser of that mandatory age or
the age specified in the Adoption Agreement.
2.39 "Normal Retirement Benefit" shall mean the benefit to
which a Participant is entitled at his Normal Retirement Date.
2.40 "Normal Retirement Date" shall mean the first day of
the month coincident with or next following a Participant's
Normal Retirement Age.
2 - 9<PAGE>
[DATE]
2.41 "Owner-Employee" shall mean an individual who is a
sole proprietor, or who is a partner owning more than ten (10)
percent of the capital or profits interest of the partnership.
2.42 "Paired Plans" shall mean two (2) defined contribution
plans adopted by the Employer pursuant to Adoption Agreements
#001 and #003 under this prototype plan, the Defined
Contribution Basic Plan Document #01, when paired under ARTICLE
14. Paired Plans shall be standardized plans established by the
Employer pursuant to Revenue Procedure 84-23, as updated by
Revenue Procedure 89-9.
2.43 "Participant" shall mean an Employee who meets all
applicable conditions of eligibility of Section 5 of the
Adoption Agreement and has commenced participation in accordance
with such Section and ARTICLE 3 hereof.
2.44 "Plan" shall mean the defined contribution plan
established by the Employer as described in the Adoption
Agreement, together with the applicable provisions of this Plan,
including the Trust established pursuant to ARTICLE 16 hereof,
and any and all amendments thereto.
2.45 "Plan Year" shall mean the twelve (12) consecutive
month period designated by the Employer in Section l(d) of the
Adoption Agreement.
2.46 "Predecessor Employer" shall mean the same business of
the Employer prior to its present form. For example, if the
Employer is presently in corporate form, it shall mean the same
business operated as a proprietorship or partnership.
2.47 "Predecessor Plan" shall mean the plan of deferred
compensation, if any, which has been amended and restated by
adoption of this Plan.
2.48 "Qualified Joint and Survivor Annuity" shall mean an
immediate annuity for the life of the Participant with a
survivor annuity for the life of the Spouse as described in
Section 11.04(d).
2.49 "Qualified Life Insurance Company" shall mean a legal
reserve life insurance company licensed to do business in the
State in which the Employer maintains its principal place of
business.
2.50 "Retired Participant" shall mean any Participant
whose Termination of Employment entitles the Participant to
receive benefits under Section 7.01, 7.02 or 7.03, subject to
ARTICLE 11.
2 - 10<PAGE>
<PAGE>
2.51 "Self-Employed Individual" shall mean an individual
who has Earned Income for the taxable year from the trade or
business for which the Plan is established; also, an individual
who would have had Earned Income but for the fact that the trade
or business had no Net Profits for the taxable year.
2.52 "Service" shall mean service as an Employee of the
Employer.
2.53 "Sponsor" shall mean Home Federal Bank of Tennessee,
FSB, the sponsoring organization.
2.54 "TEFRA" shall mean the Tax Equity and Fiscal
Responsibility Act of 1982.
2.55 "Termination of Employment" shall mean the cessation
of active work for the Employer. However, should an Employee
cease active work due to sickness, injury, leave of absence, or
temporary layoff, employment shall be deemed to be continued
until receipt by the Trustee, from the Employer, of a written
notice of termination. In the giving of such notice of the
Employer to the Trustee, all Participants in similar situations
shall be treated alike.
2.56 "Trust Fund" shall mean the assets of the Trust
established pursuant to ARTICLE 16 hereunder, held and
administered by the Trustee for purposes of this Plan.
2.57 "Trust Fund Earnings" shall mean (a) the fair market
value of the Trust Fund on the current Allocation Date, minus
(b) the fair market value of the Trust Fund on the Allocation
Date that immediately precedes the current Allocation Date,
minus (c) all contributions paid to the Trust Fund from such
preceding Allocation Date through the current Allocation Date
(including any dividends or credits earned on insurance
contracts), plus (d) all benefits paid to Participants from such
preceding Allocation Date through the current Allocation Date
(including any insurance premiums paid or accrued).
2.58 "Trustee" shall mean the individual or, jointly and
severally, the individuals as specified in Section 3 of the
Adoption Agreement who have accepted the duties and
responsibilities of this position by execution of the Adoption
Agreement or such other writing as will evidence such
acceptance. The Trustee shall be specifically limited to those
other affiliates of the Sponsor which are legally authorized to
perform fiduciary trust services and to those individuals and
organizations permitted by law and authorized in writing by the
Sponsor to act as Trustee to the extent so authorized.
2 - 11<PAGE>
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2.59 "Vested Benefit" shall mean the portion of an Account
to which a Participant is entitled as determined under Section
9.01 of the Plan and Section 11 of the Adoption Agreement.
2.60 "Year of Service" shall mean a twelve (12) consecutive
month period during which an Employee has been credited with at
least one thousand (1,000) Hours of Service. For eligibility
purposes, the period shall be the Eligibility Computation
Period. For vesting purposes, the period will be measured by
the Plan Year, or the twelve (12) consecutive month period
commencing on the date the Employee first performs on Hour of
Service and each subsequent twelve (12) consecutive month period
commencing on the anniversary of such date, as elected by the
Employer in Section 11 of the Adoption Agreement. For all other
purposes, the period will be measured by the Plan Year.
If the Employer maintains the plan of a Predecessor Employer,
years of service with such Predecessor Employer will be treated
as Years of Service for the Employer.
If the first Plan Year is a Short Plan Year (less than twelve
(12) consecutive months) or the Plan Year is changed creating a
Short Plan Year, the following special rules apply for
determining Years of Service:
(a) A Participant receives credit for a Year of
Service for purposes of receiving an allocation of Employer
Contributions (and Forfeitures, if applicable), and for purposes
of computing Years of Service for vesting purposes and Years of
Service for eligibility purposes, if the Participant receives
credit for the Applicable Hours during the Short Plan Year. The
term Applicable Hours shall equal "X" where X is defined as H/12
times Y where Y equals the number of complete months in the
Short Plan Year, and H equals 1,000 Hours of Service.
(b) Notwithstanding the above, if a Participant would
have been credited with a Year of Service for vesting purposes
during the 12 month period beginning on the first day of the
Short Plan Year, then the Participant will receive a Year of
Service for vesting purposes for the Short Plan Year.
2.61 "Years of Vesting Service" shall mean the sum of an
Employee's Years of Service expressed in whole years; excluding,
however, any Years of Service excluded under Section 12 of the
Adoption Agreement.
2 - 12<PAGE>
<PAGE>
ARTICLE 3
---------
ELIGIBILITY AND PARTICIPATION
-----------------------------
3.01 Eligibility.
-----------
Each Employee who is not excluded from participation
under Section 4 of the Adoption Agreement and who has met the
eligibility requirements set forth in Section 5 of the Adoption
Agreement shall be eligible to become a Participant on the Entry
Date. Notwithstanding the foregoing, an Employee shall enter
the Plan no later than the earlier of:
(a) the first day of the Plan Year beginning after
the date on which the Employee has met the minimum age and
service requirements; or
(b) six (6) months after the date the requirements
are met.
3.02 Participation.
-------------
Each Employee who has met the eligibility requirements
for participation shall become a Participant as set forth in
Section 5 of the Adoption Agreement, with the following
exceptions:
(a) In the case of an Employer which maintained a
Predecessor Plan, each Employee participating in such plan
immediately prior to the Effective Date hereof shall become a
Participant on the Effective Date hereof.
(b) If the Plan provides one hundred (100) percent
vesting immediately after an Employee completes the eligibility
requirements set forth in Section 5 of the Adoption Agreement,
and an Employee has a one (1) year Break in Service before
satisfying the Plan's requirements for eligibility, Service
before such Break will not be taken into account.
(c) In the case of a Participant who does not have
any nonforfeitable right to the Account balance derived from
Employer Contributions, Years of Service before a period of
consecutive one (1) year Breaks in Service will not be taken
into account in computing eligibility Service if the number of
consecutive one (1) year Breaks in Service in such period equals
or exceeds the greater of five (5) or the aggregate number of
Years of Service. Such aggregate number of Years of Service
will not include any Years of Service disregarded under the
preceding sentence by reason of prior Breaks in Service. If a
Participant's Years of
3 - 1<PAGE>
<PAGE>
Service are disregarded pursuant to this subsection (c), such
Participant will be treated as a new Employee for eligibility
purposes. If a Participant's Years of Service may not be
disregarded pursuant to this subsection (c), such Participant
shall continue to participate in the Plan, or, if terminated,
shall participate immediately upon reemployment.
3.03 Return to Eligible Class.
------------------------
In the event a Participant is no longer a member of an
eligible class of Employees and becomes ineligible to
participate but has not incurred a Break in Service, such
Employee will participate immediately upon returning to an
eligible class of Employees. If such Participant incurs a Break
in Service, eligibility will be determined pursuant to Section
3.02.
In the event an Employee who is not a member of an
eligible class of Employees becomes a member of an eligible
class, such Employee will participate immediately if such
Employee has satisfied the minimum age and service requirements
and would have otherwise previously become a Participant.
3.04 Transfers Among Adopting Employers Which Are
Controlled Group Members.
--------------------------------------------
A transfer of an Employee directly from one adopting
Employer which is a Controlled Group Member to another shall not
constitute a termination of employment or an interruption in
Years of Service; provided, however, that there shall be no
duplication of benefits. The Accounts, if any, attributable to
a Participant's Service with an Employer which is a Controlled
Group Member from which he transferred shall be retained in such
Employer's Plan, shall be credited with any Trust Fund Earnings
or other adjustments attributable thereto in accordance with
Section 5.05 and shall continue to vest based on his continued
Years of Service under that Controlled Group Member to which he
transferred. Immediately upon his transfer, such Employee shall
participate in the plan of the Controlled Group Member to which
he transferred; provided, however, that his Years of Service for
determining his nonforfeitable benefit under the Plan of the
Employer from which he transferred shall count as Years of
Service under the Plan of the Controlled Group Member to which
he transferred.
3.05 Controlled Trades or Businesses.
-------------------------------
(a) If this Plan provides contributions or
benefits for one or more Owner-Employees who control both the
business for which this Plan is established and one or more
other trades or businesses, the Plan and the plan established
for other trades or
3 - 2<PAGE>
<PAGE>
businesses must, when looked at as a single plan, satisfy
Sections 401(a) and (d) of the Code for the employees of this
and all other trades or businesses.
(b) If the Plan provides contributions or benefits
for one or more Owner-Employees who control one or more trades
or businesses, the employees of the other trades or businesses
must be included in a plan which satisfies Section 401(a) and
(d) of the Code and which provides contributions and benefits
not less favorable than provided for such Owner-Employee under
this Plan.
(c) If an individual is covered as an Owner-Employee
under the plans of two or more trades or businesses which are
not controlled and the individual controls a trade or business,
then the contributions or benefits for the employees under the
plan of the trade or business which are controlled must be as
favorable as those provided for him Under the most favorable
plan of the trades or businesses which are not controlled.
(d) For purposes of subsections (a), (b) and (c),an
Owner-Employee, or two or more Owner-Employees shall be
considered to control a trade or business if such Owner-
Employee, or such two or more Owner-Employees together:
(i) own the entire interest in an unincorporated
trade or business, or
(ii) in the case of a partnership, own more than
50 percent of either the capital interest or the profits
interest in the partnership.
For purposes of the preceding sentence, an Owner-
Employee, or two or more Owner-Employees shall be treated as
owning any interest in a partnership which is owned, directly or
indirectly, by a partnership which such Owner-Employee or such
two or more Owner-Employees, are considered to control within
the meaning of the preceding sentence.
3.06 Acceptance.
-----------
The Plan shall not be deemed either to constitute a
contract between the Employer and any Participant or to be a
consideration or an inducement for the employment of any
Employee. No provision of the Plan shall be deemed to abridge or
limit any managerial right of the Employer or to give any
Employee or Participant the right to be retained in employment,
or to interfere with the right of the Employer to discharge any
Employee or Participant at any time, regardless of the effect
which such discharge may have upon him as a Participant. By his
act of participation herein, each Participant, on behalf of
himself, his heirs, assigns and Beneficiary or Beneficiaries
shall be deemed conclusively to have agreed to and accepted the
terms and conditions of the Plan.
3 - 3<PAGE>
<PAGE>
ARTICLE 4
---------
CONTRIBUTIONS
-------------
4.01 Employer Contributions.
----------------------
If the Plan is a profit sharing plan, then each Plan
Year the Employer shall make a contribution computed under
Section 7 of the Adoption Agreement. Such contribution may be
made either in cash or in other property acceptable to the
Trustee.
If the Plan is a money purchase pension plan, then
each Plan Year the Employer shall make a contribution as a
minimum funding standard computed under Section 7 of the
Adoption Agreement on behalf of Participants who are entitled to
receive an allocation pursuant to Section 7 of the Adoption
Agreement. The Employer Contribution may be made either in cash
or in other property acceptable to the Trustee.
Notwithstanding the foregoing, if the Plan is a
non-standardized plan, then a Self-Employed Individual, an
Owner-Employee or an Employee who is not an officer, shareholder
or highly compensated individual may elect not to participate in
the Plan in a Plan Year or, at his election, may direct the
Employer not to contribute on his behalf for a Plan Year, or to
contribute for a Plan Year a lesser portion than that to be
contributed on behalf of other Participants for the Plan Year
according to the contribution and allocation formulas of the
Plan. Such an election shall be in writing and shall be made in
such form, and at such time, as the Employer may require. An
Employee who is a partner in a partnership Employer that adopts
the Plan may elect to make a one-time irrevocable election upon
the Employee's Employment Commencement Date or upon the
Employee's date of Plan participation not to participate in the
Plan or to direct the Employer not to contribute on his behalf.
Such an election shall be in writing and shall be made in such
form, and at such time, as the Employer may require.
4.02 Employee Contributions.
----------------------
(a) Voluntary Contributions.
-----------------------
Except as provided for in Section 6.07, this Plan
will not accept non-deductible Voluntary Contributions for Plan
Years beginning after the Plan Year in which this Plan is
adopted by the Employer. Voluntary Contributions for Plan Years
beginning after December 31, 1986, together with any Matching
Contributions as defined in Section 401(m) of the Code, will be
limited so as to meet the nondiscrimination test of Section
401(m).
4 - 1<PAGE>
<PAGE>
(b) Deductible Contributions.
------------------------
The Administrator will not accept Deductible
Contributions which are made for a taxable year beginning after
December 31, 1986. Deductible Contributions made prior to that
date will be maintained in a separate Account which will be
nonforfeitable at all times. The Account will share in the
gains and losses of the Trust Fund in the same manner as
described in Section 5.05. No part of the Deductible
Contributions Account will be used to purchase life insurance.
Subject to ARTICLE 11 (if applicable), the Participant may
withdraw any part of the Deductible Contributions Account by
making a written application to the Administrator.
4.03 Elective Deferrals.
------------------
If the Plan is a profit sharing plan and the Employer
selects the CODA option under Section 24 of the Adoption
Agreement, subject to the limitations and requirements of
ARTICLE 6, beginning with the first full payroll period
beginning after the later of (a) the Effective Date or (b) the
date this Plan is communicated to the Participants, each
Employee who is eligible to participate in the Plan and who
desires to make Elective Deferrals shall sign a written
participation form (hereinafter referred to as the "Salary
Reduction Agreement"). The terms of the Salary Reduction
Agreement shall provide that the Participant agrees to accept a
reduction in Compensation from the Employer in whole percentages
or specified dollar amounts as provided in Section 24, Item 2 of
the Adoption Agreement; provided, however, that in no event
shall the reduction in Compensation, when added to the amount
allocated to the Participant's Employer Contributions Account
pursuant to Section 8 of the Adoption Agreement, exceed the
limits outlined in Section 5.07. In consideration of such
Agreement, the Employer will make a contribution (referred to as
an Elective Deferral) to the Plan on behalf of the Participant
for such payroll period in an amount equal to the total amount
by which the Participant's Compensation was reduced during the
payroll period pursuant to the Salary Reduction Agreement.
4.04 Rollover Contributions.
----------------------
If so authorized under Section 10 of the Adoption
Agreement, an Employee may roll over to this Plan the following:
(a) His interest in a pension, profit-sharing or
stock bonus plan qualified under Section 401(a) or 403(a) of the
Code to this Plan, provided that:
(i) no part of the distribution is attributable
to contributions made on behalf of the Employee while he was
a Key Employee in a Top-Heavy Plan as defined in Section
13.01;
4 - 2<PAGE>
<PAGE>
(ii) the amount distributed from such plan is
transferred to this Plan no later than the 60th day after
such distribution was received by the Employee;
(iii) the distribution constituted the Employee's
entire nonforfeitable interest in such plan and was made
within one taxable year to the Employee as a lump sum
distribution; and
(iv) the amount transferred to this Plan does
not include any voluntary employee contributions made by the
Employee to the prior Plan.
(b) An Individual Retirement Plan qualified under
Section 408 of the Code, where the Individual Retirement Plan
was used as a conduit from the plan from which the distribution
was made and the rollover is made in accordance with subsection
(a), provided that the amount so transferred does not include:
(i) amounts received by the Individual
Retirement Plan that were attributable to contributions made
on behalf of a Self-Employed Individual, and
(ii) contributions made by the Employee to the
Individual Retirement Plan or earnings on such contributions.
Furthermore, a rollover of "accumulated Deductible Employee
Contributions" (as defined by Section 72(o) of the Code) may be
made if and to the extent permitted by the Secretary of the
Treasury. An Employee's interest in such rollover and earnings
thereon shall remain 100 percent vested and nonforfeitable at
all times.
4.05 Trustee-To-Trustee Transfers.
----------------------------
If so authorized under Section 10 of the Adoption
Agreement, an Employee may make a direct transfer of plan assets
attributable to his participation in a pension, profit-sharing
or stock bonus plan qualified under Section 401(a) of the Code
to the Plan from such other plan by that plan's trustee. A
separate account shall be established for such assets in the
name of the Employee. Such assets, together with all records
relating to accrued benefits, contributions and account balances
shall be accepted from the trustee or custodian under the
qualified plan, or, in the case of insurance policies, from the
owner thereof if different from the trustee or custodian. An
Employee's interest in the separate account and earnings thereon
shall remain 100 percent vested and nonforfeitable at all times.
Such account shall be subject to the requirements set forth in
ARTICLE 11.
4 - 3<PAGE>
<PAGE>
Assets attributable to employment as an Owner-Employee
under an H.R.-1O plan (exclusive of the portion attributable to
voluntary contributions thereunder) shall not begin to be
distributed before the Employee dies, incurs a Disability or
attains age 59-1/2, nor later than the taxable year in which the
Employee attains age 70-1/2.
No part of such direct transfer may consist of
Voluntary Contributions. Likewise, the Trustee may make such a
direct transfer from this Plan of assets attributable to a
Participant's participation in this Plan to another pension,
profit-sharing or stock bonus plan qualified under Section
401(a) of the Code.
Such direct trustee-to-trustee transfers shall not
be considered either in determining the maximum benefits
permissible under the Plan pursuant to Section 5.07 hereof or as
contributions by the Employer under Section 7 of the Adoption
Agreement.
4.06 Prohibition of Reversion.
------------------------
Contributions made by the Employer to the Plan shall
be made irrevocably and it shall be impossible for the assets of
the Plan to inure to the benefit of the Employer or to be used
in any manner other than for the exclusive purpose of providing
benefits to Participants, Inactive Participants, Retired
Participants and Beneficiaries, and for defraying reasonable
expenses of administering the Plan; provided, however, that
nothing herein shall be construed to prohibit the return to the
Employer of all or part of a Contribution:
(a) which is made by the Employer due to a mistake
of fact, provided the return of such Contribution is made within
one (1) year after the date of payment thereof, or
(b) which is conditioned upon initial
qualification of the Plan under the Code pursuant to Section
17.06, provided the return is made, if the Plan does not
qualify, within one year after the denial of qualification by
the Internal Revenue Service, but only if the application for
the qualification is made by the time prescribed by law for
filing the Employer's return for the taxable year in which the
Plan is adopted, or such later date an the Secretary of the
Treasurer may prescribe, or
(c) to the extent a deduction thereof under
Section 404 of the Code is disallowed, provided the return of
such Contribution is limited to the amount disallowed and is
made within one year after the disallowance.
4 - 4<PAGE>
<PAGE>
ARTICLE 5
---------
PARTICIPANTS' ACCOUNTS
----------------------
5.01 Establishment of Participants' Accounts.
---------------------------------------
The Trustee shall maintain separate Accounts for each
Employee to which will be credited contributions and earnings as
follows:
(a) Employer Contributions Account. Employer
Contributions made on the Participant's behalf pursuant to
Section 7 of the Adoption Agreement and Forfeitures reallocated
pursuant to Section 7 of the Adoption Agreement, if applicable,
will be maintained in a separate Account.
(b) Voluntary Contributions Account. Voluntary
Contributions made by the Participant pursuant to Section 6.07,
if any, will be maintained in a separate Account which will be
nonforfeitable at all times.
(c) Matching Contributions Account. Matching
Contributions made by the Employer on the Participant's behalf
pursuant to Section 6.08, will be maintained in a separate
Account.
(d) Deductible Contributions Account. Deductible
Contributions which are made for taxable years beginning before
January 1, 1987 will be maintained in a separate Account which
will be nonforfeitable at all times. No part of the Deductible
Contribution Account will be used to purchase life insurance.
Subject to ARTICLE 11 (if applicable), the Participant may
withdraw any part of the Deductible Contribution Account by
making a written application to the Administrator.
(e) Elective Deferral Account. Elective Deferrals
made on the Participant's behalf through an applicable Salary
Reduction Agreement pursuant to Section 6.01, and the interest,
dividends, earnings or proceeds of any insurance policy(ies)
purchased with funds from this Account will be maintained in a
separate Account which will be nonforfeitable at all times.
(f) Rollover Account. Rollover Contributions made
by an Employee pursuant to Section 4.04 will be maintained in a
separate Account which will be nonforfeitable at all times.
(g) Trustee-to-Trustee Transfer Account. Trustee-
to-Trustee Transfers made by an Employee pursuant to Section
4.05 will be maintained in a separate Account which will be
nonforfeitable at all times. Such Account shall be subject to
the rules of ARTICLE 11.
5 - 1<PAGE>
<PAGE>
(h) Participant-Directed Investment Account.
Participant-Directed Investments, if elected by the Employer in
Section 17 of the Adoption Agreement, will be maintained in a
separate Account, but such Account shall not be segregated and
shall be maintained separately only for bookkeeping purposes.
Each of the Accounts described above, except for
Participant-Directed Investment Accounts, will share in the
gains and losses of the Trust Fund in the same manner as
described in Section 5.05. Each of the Accounts described above
shall be debited with all disbursements to the Participant or
his Beneficiary and, except for Deductible Contributions
Accounts, the purchases of insurance policies from this Account.
5.02 Valuation of Trust Fund.
-----------------------
(a) The assets of the Trust Fund will be valued
annually at fair market value as of the last day of the Plan
Year. On such date, the earnings and losses of the Trust Fund
will be allocated to each Participant's Accounts in the ratio
that such Account balances bear to all Account balances.
(b) If the Plan is fully insured, any dividends or
credits earned on insurance contracts will be applied, within
the taxable year of the Employer in which received or within the
next succeeding taxable year, toward the next premiums due
before any further Employer Contributions are so applied.
(c) If the Plan is trusteed, any dividends or credits
earned on insurance contracts will be allocated to the
Participant's Account derived from Employer Contributions for
whose benefit the contract is held.
5.03 Allocation of Employer Contributions.
------------------------------------
On each Allocation Date, on behalf of each eligible
Participant, Employer Contributions shall be allocated to such
Participant's Employer Contributions Account in accordance with
Section 8 of the Adoption Agreement.
If the Plan is a profit-sharing plan and the Plan is
integrated with Social Security, as elected in Section 8 of the
Adoption Agreement, Employer Contributions for the Plan Year
plus any Forfeitures will be allocated to Participants' Accounts
as follows:
STEP ONE: Contributions and Forfeitures will be
allocated to each Participant's Account in the ratio that each
Participant's total Compensation bears to all Participant's
total Compensation, but not in excess of 3% of each
Participant's Compensation.
5 - 2<PAGE>
<PAGE>
STEP TWO: Any Contributions and Forfeitures remaining
after the allocation in Step One will be allocated to each
Participant's Account in the ratio that each Participant's
Compensation for the Plan Year in excess of the integration
level bears to the excess Compensation of all Participants, but
not in excess of 3%.
STEP THREE: Any Contributions and Forfeitures
remaining after the allocation in Step Two will be allocated to
each Participant's Account in the ratio that the sum of each
Participant's total Compensation and Compensation in excess of
the integration level bears to the sum of all Participants total
Compensation and Compensation in excess of the integration
level, but not in excess of the maximum profit-sharing disparity
rate.
STEP FOUR: Any remaining Employer Contributions or
Forfeitures will be allocated to each Participant's Account in
the ratio that each Participant's total Compensation for the
Plan Year bears to all Participants' total Compensation for that
Year.
The integration level shall be equal to the taxable
wage base or such lesser amount elected by the Employer in
Section 8 of the Adoption Agreement. The taxable wage base is
the maximum amount of earnings which may be considered wages for
a Year under Section 3121(a)(1) of the Code in effect as of the
beginning of the Plan Year.
Compensation shall mean Compensation as defined in
Section 13.02.
The maximum profit-sharing disparity rate is equal to
the lesser of:
(a) 2.7%
(b) the applicable percentage determined in
accordance with the table below:
If the integration level
the
applicable
is more than but not more than percentage is:
$0 X* 2.7%
X* of TWB 80% of TWB 1.3%
80% of TWB Y** 2.4%
*X = the greater of $10,000 or 20 percent of the TWB.
**Y = any amount more than 80% of the TWB but less than 100% of
the TWB.
5 - 3<PAGE>
<PAGE>
If the integration level used is equal to the taxable wage base,
the applicable percentage is 2.7%.
5.04 Forfeitures.
-----------
On each Allocation Date, any Forfeitures occurring
will be disposed of in the following manner:
(a) If the Plan is a profit sharing plan, any
Forfeitures occurring will be aggregated with any Employer
Contributions for the Plan Year and allocated in accordance with
Section 8 of the Adoption Agreement;
(b) If the Plan is a money purchase pension plan, as
elected by the Employer in Section 11 of the Adoption Agreement:
(i) any Forfeitures occurring will reduce
Employer Contributions for the next Plan Year, or
(ii) Forfeitures will be allocated in the ratio
that the Compensation of each Participant bears to that of
all Participants.
No Forfeitures will occur solely as a result of an
Employee's withdrawal of Voluntary Contributions.
5.05 Trust Earnings and Losses.
-------------------------
On each Allocation Date, each Participant's Account
shall be credited or charged with such Account's share of the
Trust Fund Earnings or losses since the last Allocation Date.
With respect to Participant-Directed Investment Accounts,
earnings and losses shall be credited or charged to these
Accounts as set forth in Section 5.08 hereof. With respect to
the other Accounts of the Participant not directed pursuant to
Section 5.08 hereof, earnings and losses shall be in the same
proportion to such Trust Fund Earnings that such Account balance
on the last Allocation Date bears to the total of the
nondirected Account balances on the last Allocation Date of all
Participants who were Participants on the last Allocation Date
and who are Participants on the current Allocation Date. In
determining the Account balances on the last Allocation Date,
(i) the Elective Deferral Account shall be increased by one-half
of any Elective Deferrals (excluding any additional Elective
Deferrals made during the last complete payroll period of a Plan
Year) credited to the Elective Deferral Account since the
preceding Allocation Date, (ii) each Employer Contributions
Account balance shall be reduced by the cash surrender value of
any life insurance policies included in the Employer
Contributions Account balance on the last Allocation Date, and
(iii) each Account shall be reduced by the amount of any
disbursements from such Account during the Plan Year.
Alternatively, if approved by the Trustee (or custodian)
5 - 4<PAGE>
<PAGE>
and the Administrator, Trust Fund Earnings may be allocated in
any equitable, uniform and nondiscriminatory manner which is
selected for the purpose of recognizing the timing of
contributions, withdrawals, distributions, transfers,
Participant or Employer directed investments or other temporal
events affecting Account value as adjustments to Account
balances.
If a Participant rolls over or transfers funds
pursuant to Section 4.04 or 4.05 during the Plan Year, then for
purposes of allocating the Participant's share of the Trust Fund
Earnings and losses for that same Plan Year, the Participant's
Rollover Account balance or Trustee-to-Trustee Transfer Account
balance as of the preceding Allocation Date shall include the
amount the Participant rolls over or transfers during the Plan
Year, times the number of days in the Plan Year in which the
rollover or transfer occurs, beginning with the day of the
transfer or rollover, divided by 365.
5.06 Inactive Participants.
---------------------
Unless otherwise provided under Section 8(b) of the
Adoption Agreement, an Inactive Participant shall not be
entitled to share in Employer Contributions, or Forfeitures if
applicable, for a Plan Year. Nevertheless, his Accounts shall
be maintained and credited or charged with Trust Fund Earnings
in accordance with Section 5.05 hereof, until the balance
thereof (to the extent vested) shall have been fully
distributed.
5.07 Limitations on Allocations.
--------------------------
(a) Participant in One Defined Contribution Plan.
--------------------------------------------
(i) If the Participant does not participate
in, and has never participated in, another qualified plan, a
welfare benefit fund as described in Section 419(e) of the
Code maintained by the Employer, or an individual medical
account as described in Section 415(l)(2) of the Code
maintained by the Employer, which provides an Annual Addition
as defined in subsection (e)(i), the amount of Annual
Additions which may be credited to the Participant's
Individual Account for any Limitation Year will not exceed
the lesser of the Maximum Permissible Amount or any other
limitation contained in this Plan. If the Employer
Contribution that would otherwise be contributed or allocated
to the Participant's Employer Contributions Account would
cause the Annual Additions for the Limitation Year to exceed
the Maximum Permissible Amount, the amount contributed or
allocated will be reduced so that the Annual Additions for
the Limitation Year will equal the Maximum Permissible
Amount.
5 - 5<PAGE>
<PAGE>
(ii) Prior to determining the Participant's
actual Compensation for the Limitation Year, the Employer may
determine the Maximum Permissible Amount for a Participant on
the basis of a reasonable estimation of the Participant's
Compensation for the Limitation Year, uniformly determined
for all Participants similarly situated.
(iii) As soon as is administratively feasible
after the end of the Limitation Year, the Maximum Permissible
Amount for the Limitation Year will be determined on the
basis of the Participant's actual Compensation for the
Limitation Year.
(iv) If pursuant to subsection (iii) or as a
result of the allocation of Forfeitures, there is an Excess
Amount, the excess will be disposed of as follows:
(1) Any non-deductible Voluntary
Contributions, to the extent they would reduce the
Excess Amount, will be returned to the Participant;
(2) If after the application of paragraph
(1) an Excess Amount still exists, and the Participant
is covered by the Plan at the end of the Limitation
Year, the Excess Amount in the Participant's Employer
Contributions Account will be used to reduce Employer
Contributions (including any allocation of
Forfeitures) for such Participant in the next
Limitation Year, and each succeeding Limitation Year
if necessary.
(3) If after the application of paragraph
(1) an Excess Amount still exists, and the Participant
is not covered by the Plan at the end of a Limitation
Year, the Excess Amount will be held unallocated in a
suspense account. The suspense account will be
applied to reduce future Employer Contributions
(including allocation of any Forfeitures) for all
remaining Participants in the next Limitation Year,
and each succeeding Limitation Year, if necessary.
(4) If a suspense account is in existence
at any time during a Limitation Year pursuant to this
Section, it will not participate in the allocation of
the Trust's investment gains and losses. If a
suspense account is in existence at any time during a
particular Limitation Year, all amounts in the
suspense account must be allocated and reallocated to
Participants' Accounts before any Employer
Contributions or any Employee Contributions may be
made to the Plan for that Limitation Year. Excess
amounts may not be distributed to Participants or
former Participants.
5 - 6<PAGE>
<PAGE>
(b) Participant Covered Under Another Defined
Contribution Plan.
-----------------------------------------
(i) This Section applies if, in addition to
this Plan, the Participant is covered under another qualified
Master or Prototype defined contribution plan maintained by
the Employer, a welfare benefit fund as defined in Section
419(e) of the Code maintained by the Employer, or an
individual medical account, as defined in Section 415(l)(2)
of the Code maintained by the Employer, which provides an
Annual Addition as defined in subsection (e)(i), during any
Limitation Year. The Annual Additions which may be credited
to a Participant's Accounts under this Plan for any such
Limitation Year will not exceed the Maximum Permissible
Amount reduced by the Annual Additions credited to a
Participant's individual account under the other plans and
welfare benefit funds for the same Limitation Year. If the
Annual Additions with respect to the Participant under other
defined contribution plans and welfare benefit funds
maintained by the Employer are less than the Maximum
Permissible Amount and the Employer Contribution that would
otherwise be contributed or allocated to the Participant's
Employer Contributions Account under this Plan would cause
the Annual Additions for the Limitation Year to exceed this
limitation, the amount contributed or allocated will be
reduced so that the Annual Additions under all such plans and
funds for the Limitation Year will equal the Maximum
Permissible Amount. If the Annual Additions with respect to
the Participant under such other defined contribution plans
and welfare benefit funds in the aggregate are equal to or
greater than the Maximum Permissible Amount, no amount will
be contributed or allocated to the Participant's Accounts
under this Plan for the Limitation Year.
(ii) Prior to determining the Participant's
actual Compensation for the Limitation Year, the Employer may
determine the Maximum Permissible Amount for a Participant in
the manner described in subsection (a) (ii).
(iii) As soon as is administratively feasible
after the end of the Limitation Year, the Maximum Permissible
Amount for the Limitation Year will be determined on the
basis of the Participant's actual Compensation for the
Limitation Year.
(iv) If, pursuant to subparagraph (iii) or
as a result of the allocation of Forfeitures, a Participant's
Annual Additions under this Plan and such other plans would
result in an Excess Amount for a Limitation Year, the Excess
Amount will be deemed to consist of the Annual Additions last
allocated, except that Annual Additions attributable to a
welfare benefit fund or individual medical account will be
deemed to have been allocated first, regardless of the actual
Allocation Date.
5 - 7<PAGE>
<PAGE>
(v) If an Excess Amount was allocated to a
Participant on an Allocation Date of this Plan which
coincides with an allocation date of another plan, the Excess
Amount attributed to this Plan will be the product of:
(1) the total Excess Amount allocated as
of such date, times
(2) the ratio of (A) the Annual Additions
allocated to the Participant for the Limitation Year
as of such date under this Plan to (B) the total
Annual Additions allocated to the Participant for the
Limitation Year as of such date under this and all the
other qualified Master or Prototype defined
contribution plans.
(vi) Any Excess Amount attributed to this Plan
will be disposed in the manner described in subsection
(a)(iv).
(c) Participant Covered Under Another Defined
Contribution Plan Which Is Not A Master Or
Prototype Plan.
------------------------------------------
If the Participant is covered under another
qualified defined contribution plan maintained by the Employer
which is not a Master or Prototype Plan, Annual Additions which
may be credited to the Participant's Accounts under this Plan
for any Limitation Year will be limited in accordance with
subsections (b) and (c) as though the other plan was a Master or
Prototype Plan unless the Employer provides other limitations in
Section 19 of the Adoption Agreement.
(d) Participant Covered Under A Defined Benefit Plan.
------------------------------------------------
If the Employer maintains, or at any time
maintained, a qualified defined benefit plan covering any
Participant in this Plan, the sum of the Participant's Defined
Benefit Plan Fraction and Defined Contribution Plan Fraction
will not exceed 1.0 in any Limitation Year. The Annual
Additions which may be credited to the Participant's Accounts
under this Plan for any Limitation Year will be limited in
accordance with Section 19 of the Adoption Agreement.
(e) Definitions.
-----------
(i) Annual Additions: The sum of the
following amounts credited to a Participant's Accounts for
the Limitation Year:
5 - 8<PAGE>
<PAGE>
(1) Employer Contributions, including
Elective Deferrals;
(2) Employee Contributions;
(3) Forfeitures, if applicable; and
(4) Amounts allocated, after March 31,
1984, to an individual medical account as defined in
Section 415(l)(2) of the Code, which is part of a
pension or annuity plan maintained by the Employer
are treated as Annual Additions to a defined
contribution plan. Also, amounts derived from
contributions paid or accrued after December 31,
1985, in taxable years ending after such date, which
are attributable to postretirement medical benefits,
allocated to the separate account of a Key Employee,
as defined in Section 419A(d)(3) of the Code, under
a welfare benefit fund as defined in Section 419(e)
of the Code maintained by the Employer, are treated
as Annual Additions to a defined contribution plan.
For this purpose, any Excess Amount applied under subsection
(a) (iv) or (b) (iv) in the Limitation Year to reduce
Employer Contributions will be considered Annual Additions
for such Limitation Year.
(ii) Compensation: A Participant's earned
income, wages, salaries, and fees for professional services
and other amounts received for personal services actually
rendered in the course of employment with the Employer
maintaining the Plan (including, but not limited to,
commissions paid to salesmen, compensation for services on
the basis of a percentage of profits, commissions on
insurance premiums, tips and bonuses), and excluding the
following:
(1) Employer contributions to a plan
of deferred compensation which are not includible in
the Employee's gross income for the taxable year in
which contributed, or Employer contributions under a
simplified employee pension plan to the extent such
contributions are deductible by the Employee, or any
distributions from a plan of deferred compensation;
(2) Amounts realized from the
exercise of a nonqualified stock option, or when
restricted stock (or property) held by the Employee
either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
(3) Amounts realized from the sale,
exchange or other disposition of stock acquired
under a qualified stock option; and
5 - 9<PAGE>
<PAGE>
(4) Other amounts which received special
tax benefits, or contributions made by the Employer
(whether or not under a salary reduction agreement)
towards the purchase of an annuity described in
Section 403(b) of the Code (whether or not the amounts
are actually excludible from the gross income of the
Employee).
For purposes of applying the limitations of this Section
5.07, Compensation for a Limitation Year is the Compensation
actually paid or includible in gross income during such
limitation year.
Notwithstanding the preceding sentence, Compensation for a
Participant in a defined contribution plan who has incurred a
Disability is the Compensation such Participant would have
received for the Limitation Year if the Participant was paid
at the rate of Compensation paid immediately before incurring
the Disability; such imputed Compensation for the disabled
Participant may be taken into account only if the Participant
is not a Highly Compensated Employee and contributions made
on behalf of such Participant are nonforfeitable when made.
(iii) Defined Benefit Fraction: A fraction,
the numerator of which is the sum of the Participant's
Projected Annual Benefits under all the defined benefit plans
(whether or not terminated) maintained by the Employer, and
the denominator of which is the lesser of 125 percent of the
dollar limitation determined for the Limitation Year under
Sections 415(b) and (d) of the Code or 140 percent of the
Highest Average Compensation, including any adjustments under
Section 415(b) of the Code.
Notwithstanding the above, if the Participant was a
Participant as of the first day of the first Limitation Year
beginning after December 31, 1986, in one or more defined
benefit plans maintained by the Employer which were in
existence on May 6, 1986, the denominator of this fraction
will not be less than 125 percent of the sum of the Annual
Benefits under such plans which the Participant had accrued
as of the close of the last Limitation Year beginning before
January 1, 1987, disregarding any changes in the terms and
conditions of the Plan after May 5, 1986. The preceding
sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements
of Section 415 for all Limitation Years beginning before
January 1, 1987.
5 - 10<PAGE>
<PAGE>
(iv) Defined Contribution Dollar Limitation:
$30,000 or if greater, one-fourth of the defined benefit
dollar limitation set forth in Section 415(b)(1) of the Code
as in effect for the Limitation Year.
(v) Defined Contribution Fraction: A
fraction, the numerator of which is the sum of the Annual
Additions to the Participant's accounts under all the defined
contribution plans (whether or not terminated) maintained by
the Employer for the current and all prior Limitation Years
(including the Annual Additions attributable to the Partici-
pant's non-deductible voluntary employee contributions to all
defined benefit plans, whether or not terminated, maintained
by the Employer, and the Annual Additions attributable to all
welfare benefit funds, as defined in Section 419(e) of the
Code, and individual medical accounts, as defined in Section
415(l)(2) of the Code, maintained by the Employer), and the
denominator of which is the sum of the Maximum Aggregate
Amounts for the current and all prior Limitation Years with
the Employer (regardless of whether a defined contribution
plan was maintained by the Employer). The Maximum Aggregate
Amount in any Limitation Year is the lesser of 125 percent of
the dollar limitation determined under Sections 415(b) and
(d) of the Code in effect under Section 415(c)(1)(A) of the
Code or 35 percent of the Participant's Compensation for such
year.
If the Employee was a Participant as of the end of the first
day of the first Limitation Year beginning after December 31,
1986, in one or more defined contribution plans maintained by
the Employer which were in existence on May 6, 1986, the
numerator of this fraction will be adjusted if the sum of
this fraction and the Defined Benefit Fraction would
otherwise exceed 1.0 under the terms of this Plan. Under the
adjustment, an amount equal to the product of (1) the excess
of the sum of the fractions over 1.0 times (2) the
denominator of this fraction, will be permanently subtracted
from the numerator of this fraction. The adjustment is
calculated using the fractions as they would be computed as
of the end of the last Limitation Year beginning before
January 1, 1987, and disregarding any changes in the terms
and conditions of the Plan made after May 5, 1986, but using
the Section 415 limitation applicable to the first Limitation
Year beginning on or after January 1, 1987.
5 - 11<PAGE>
<PAGE>
The Annual Addition for any Limitation Year beginning before
January 1, 1987, shall not be recomputed to treat all
Participant contributions as Annual Additions.
(vi) Employer: For purposes of this Section
5.07, Employer shall mean the Employer that adopts this Plan,
and all Controlled Group Members as that term is modified by
Section 415(h) of the Code.
(vii) Excess Amount: The excess of the
Participant's Annual Additions for the Limitation Year over
the Maximum Permissible Amount.
(viii) Highest Average Compensation: The
Average Compensation for the three consecutive Years of
Service that produces the highest average. A Year of Service
is the 12-consecutive month period defined in Section 11 of
the Adoption Agreement.
(ix) Limitation Year: A calendar year, or
the twelve (12) consecutive month period elected by the
Employer in Section l(c) of the Adoption Agreement. All
qualified plans maintained by the Employer must use the same
Limitation Year. If the Limitation Year is amended to a
different 12-consecutive month period, the new Limitation
Year must begin on a date within the Limitation Year in which
the amendment is made.
(x) Master or Prototype Plan: A Plan the
form of which is the subject of a favorable opinion letter
from the Internal Revenue Service.
(xi) Maximum Permissible Amount: The maximum
Annual Addition that may be contributed or allocated to a
Participant's Accounts under the Plan for any Limitation Year
shall not exceed the lesser of:
(1) The Defined Contribution Dollar
limitation; or
(2) 25 percent of the Participant's
Compensation for the Limitation Year.
The Compensation limitation referred to in (2) shall not I
apply to any contribution for medical benefits (within the
meaning of Section 401(h) or 419A(f)(2) of the Code) which is
otherwise treated as an Annual Addition under Section
415(l)(1) or 419A(d)(2) of the Code.
If a short Limitation Year is created because of an amendment
changing the Limitation Year to a different twelve
consecutive month period, the Maximum Permissible Amount will
not exceed the Defined Contribution Dollar Limitation
multiplied by the following fraction:
5 - 12<PAGE>
<PAGE>
number of months in the short Limitation Year
---------------------------------------------
12
(xii) Projected Annual Benefit: The annual
retirement benefit (adjusted to an actuarially equivalent
straight-life annuity if such benefit is expressed in a form
other than a straight-life annuity or qualified joint and
survivor annuity) to which the Participant would be entitled
under the terms of the Plan assuming:
(1) the Participant will continue
employment until Normal Retirement Age under the
Plan (or current age, if later), and
(2) the Participant's Compensation for
the current Limitation Year and all other relevant
factors used to determine benefits under the Plan
will remain constant for all future Limitation Years.
5.08 Participant-Directed Investments.
--------------------------------
If elected by the Employer in Section 17 (a) or (b) of
the Adoption Agreement, each Participant may direct the Trustee
as to the type of investment to be purchased with the
Participant's Accounts other than the nonvested portion of his
Employer Contributions Account. Any directions to the Trustee
with respect to investments shall be delivered in writing to the
Trustee and shall be on a form for such purpose provided by the
Trustee. Directed investments to be executed by the Trustee
shall be made by the Trustee as soon as reasonably possible
after actual receipt of such direction; provided, however, that
the Trustee shall not be liable for any loss to the Account due
to reasonable delay in the execution of such directions. Such
directed investments shall be limited to those investments set
forth in Section 16.03(a) hereof, and may be made without any
duty to diversify. The Trustee may leave earnings on any
securities so obtained for reinvestment in accordance with the
direction of the Participant. Notwithstanding the foregoing, in
no event shall a directed investment of a Participant be
permitted in such an investment that the Trustee, in its sole
discretion, deems itself unable to administer efficiently,
properly and conveniently with respect thereto; provided,
however, that the Trustee's acceptance of the administration of
a directed investment shall not be unreasonably withheld. Upon
establishing such separate account, it shall be credited or
charged only with the increases or decreases resulting from the
administration and investment thereof as a separate unit, except
that the Trustee shall charge against such account a pro rata
portion of the fees and expenses incurred in the administration
of the Plan in general, as well as the fees and expenses
properly chargeable only to such segregated account. Thereafter,
the value of the Accounts of a Participant who directs the
segregation thereof under this Section
5 - 13<PAGE>
<PAGE>
shall be determined by reference to the value of the Accounts as
of any applicable date of determination, notwithstanding any
other provision of the Plan. The Trustee shall be under no duty
to question any such direction of a Participant with respect to
investments, nor shall the Trustee be required to review any
securities or the property held in the Account. Neither the
Trustee nor the Employer shall have any liability whatsoever for
any losses which may result from either the Participant's
direction or any investment decision made pursuant to this
Section, or for any loss which may result by reason of the
failure of a Participant to make such directions. Nor shall the
Trustee or the Employer have any liability or responsibility
whatsoever for any disparity between the performance or rates of
investment return of Participant-Directed Accounts and the Trust
Fund in general. A Participant shall be entitled to direct the
investment of his Account hereunder at such time and in such
manner as may be nondiscriminatorily established by the
Employer.
5 - 14<PAGE>
<PAGE>
ARTICLE 6
---------
CASH OR DEFERRED ARRANGEMENT
----------------------------
6.01 Salary Reduction Agreement.
--------------------------
(a) Unless the Employer specifies otherwise, the
Salary Reduction Agreement described in Section 4.03 shall apply
to each payroll period, beginning with the first payroll period
after the Entry Date following the execution of the Salary
Reduction Agreement, and continuing until such time as the
Participant elects otherwise or terminates employment.
(b) The Salary Reduction Agreement may be amended by
the Participant to change the amount of the Compensation
reduction. A change in the amount of the Compensation reduction
can be made for the first payroll period of the Plan Year next
following the timely notice of change, or any other date
selected by the Employer in the Adoption Agreement. Such notice
of change must be filed with the Administrator prior to the date
the change is effective.
(c) If elected by the Employer in the Adoption
Agreement, the Salary Reduction Agreement may be amended by the
Participant to increase the amount of the Compensation reduction
for the last complete payroll period of the Plan Year.
(d) A separate Salary Reduction Agreement may be
executed whereby the Participant elects to accept a reduction in
Compensation which is attributable to a bonus. Such election
may be made and the Salary Reduction Agreement executed at any
time prior to the payment of the bonus.
(e) A Participant may elect to suspend the
Compensation reduction at any time. A notice of suspension shall
be effective until it is revoked by the Participant. A
suspension revocation shall be accomplished by filing a new
Salary Reduction Agreement in accordance with the terms of the
Adoption Agreement.
(f) The Salary Reduction Agreement of a Participant
who is a Highly Compensated Employee may be amended by the
Participant to decrease the amount of the Compensation reduction
for the balance of a Plan Year if a midyear or interim Actual
Deferral Percentage test indicates that the Participant will
have Excess Contributions for the Plan Year.
(g) If the Employer elects in the Adoption Agreement
to permit withdrawals and a Participant makes such a withdrawal,
the Participant's Elective Deferrals will be suspended during
the 12-month period following the withdrawal.
6 - 1<PAGE>
<PAGE>
In accordance with Section 401(k) of the Code, all
amounts withheld from a Participant's Compensation in accordance
with this Section and contributed as Elective Deferrals to the
Plan shall not be included in the gross income for the
Participant for federal tax purposes, and shall be deemed for
tax purposes to be an Employer Contribution to the Plan. Such
Contributions shall be included in gross income for FICA and
FUTA tax purposes.
6.02 Annual Limit on Elective Deferrals.
----------------------------------
No Participant shall be permitted to have Elective
Deferrals made under this Plan, or any other qualified plan
maintained by the Employer, during any taxable year, in excess
of the dollar limitation contained in Section 402(g) of the Code
in effect at the beginning of such taxable year.
If a Participant receives a hardship distribution
pursuant to Section 6.16, the dollar limitation described above,
for the Participant's taxable year immediately following the
taxable year of the hardship distribution shall be reduced by
the amount of the Participant's Elective Deferrals for the
taxable year of the hardship distribution.
6.03 Distribution of Excess Elective Deferrals.
-----------------------------------------
A Participant may assign to this Plan any Excess
Elective Deferrals made during a taxable year of the Participant
by notifying the Administrator on or before the date specified
in the Adoption Agreement of the amount of the Excess Elective
Deferrals to be assigned to the Plan.
Notwithstanding any other provision of the Plan,
Excess Elective Deferrals, plus any income and minus any loss
allocable thereto, shall be distributed no later than April 15
to any Participant to whose account Excess Elective Deferrals
were assigned for the preceding year and who claims Excess
Elective Deferrals for such taxable year.
Definitions:
-----------
(a) "Elective Deferrals" shall mean any Employer
Contributions made to the Plan at the election of the
Participant, in lieu of cash Compensation, and shall include
Contributions made pursuant to a Salary Reduction Agreement or
other deferral mechanism. With respect to any taxable year, a
Participant's Elective Deferral is the sum of all Employer
Contributions made on behalf of such Participant pursuant to an
election to defer under any qualified CODA as described in
Section 401(k) of the Code, any
6 - 2<PAGE>
<PAGE>
simplified employee pension cash or deferred arrangement as
described in Section 402(h)(1)(B) of the Code, any eligible
deferred compensation plan under Section 457 of the Code, any
plan as described under Section 501(c)(18) of the Code, and any
Employer contributions made on the behalf of a Participant for
the purchase of an annuity contract under Section 403(b) of the
Code pursuant to a Salary Reduction Agreement.
(b) "Excess Elective Deferrals" shall mean those
Elective Deferrals that are includible in a Participant's gross
income under Section 402(g) of the Code to the extent such
Participant's Elective Deferrals for a taxable year exceed the
dollar limitation under such Code section. Excess Elective
Deferrals shall be treated as Annual Additions under the Plan.
Determination of income or loss: Excess Elective
Deferrals shall be adjusted for any income or loss up to the
date of distribution. The income or loss allocable to Excess
Elective Deferrals is the sum of: (1) income or loss allocable
to the Participant's Elective Deferral Account for the taxable
year multiplied by a fraction, the numerator of which is such
Participant's Excess Elective Deferrals for the year and the
denominator is the Participant's Account balance attributable to
Elective Deferrals without regard to any income or loss
occurring during such taxable year; and (2) ten percent of the
amount determined under (1) multiplied by the number of whole
calendar months between the end of the Participant's taxable
year and the date of distribution, counting the month of
distribution if distribution occurs after the 15th of such
month.
6.04 Actual Deferral Percentage Test.
-------------------------------
(a) The Actual Deferral Percentage (hereinafter
"ADP") for participants who are Highly Compensated Employees for
each Plan Year and the ADP for Participants who are Non-highly
Compensated Employees for the same Plan Year must satisfy one of
the following tests:
(i) The ADP for Participants who are Highly
Compensated Employees for the Plan Year shall not exceed the
ADP for Participants who are Non-highly Compensated Employees
for the same Plan Year multiplied by 1.25; or
(ii) The ADP for Participants who are Highly
Compensated Employees for the Plan Year shall not exceed the
ADP for Participants who are Non-highly Compensated Employees
for the same Plan Year multiplied by 2.0, provided that the
ADP for Participants who are Highly Compensated Employees
does not exceed the ADP for Participants who are Non-highly
Compensated Employees by more than two (2) percentage points.
6 - 3<PAGE>
<PAGE>
(b) Special Rules:
-------------
(i) The ADP for any Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to
have Elective Deferrals (and Qualified Non-elective
Contributions or Qualified Matching Contributions, or both,
if treated as Elective Deferrals for purposes of the ADP
test) allocated to his or her accounts under two or more
arrangements described in Section 401(k) of the Code, that
are maintained by the Employer, shall be determined as if
such Elective Deferrals (and, if applicable, such Qualified
Non-elective Contributions or Qualified Matching
Contributions, or both) were made under a single arrangement.
If a Highly Compensated Employee participates in two or more
cash or deferred arrangements that have different Plan Years,
all cash or deferred arrangements ending with or within the
same calendar year shall be treated as a single arrangement.
(ii) In the event that this Plan satisfies the
requirements of Sections 401(k), 401(a)(4), or 410(b) of the
Code only if aggregated with one or more other plans, or if
one or more other plans satisfy the requirements of such
Sections of the Code only if aggregated with this Plan, then
this Section shall be applied by determining the ADP of
employees as if all such plans were a single plan. For Plan
Years beginning after December 31, 1989, plans may be
aggregated in order to satisfy Section 401(k) of the Code
only if they have the same Plan Year.
(iii) For purposes of determining the ADP of a
Participant who is a Five-Percent Owner or one of the ten
most highly-paid Highly Compensated Employees, the Elective
Deferrals (and Qualified Non-elective Contributions or
Qualified Matching Contributions, or both, if treated as
Elective Deferrals for purposes of the ADP test) and
Compensation of such Participant shall include the Elective
Deferrals (and, if applicable, Qualified Non-elective
Contributions and Qualified Matching Contributions, or both)
and Compensation for the Plan Year of Family Members (as
defined in Section 414(q)(6) of the Code). Family Members,
with respect to such Highly Compensated Employees, shall be
disregarded as separate Employees in determining the ADP both
for Participants who are Non-highly Compensated Employees and
for Participants who are Highly Compensated Employees.
(iv) For purposes of determining the ADP test,
Elective Deferrals, Qualified Non-elective Contributions and
Qualified Matching Contributions must be made before the last
day of the twelve-month period immediately following the Plan
Year to which contributions relate.
6 - 4<PAGE>
<PAGE>
(v) The Employer shall maintain records
sufficient to demonstrate satisfaction of the ADP test and
the amount of Qualified Non-elective Contributions or
Qualified Matching Contributions, or both, used in such test.
(vi) The determination and treatment of the ADP
amounts of any Participant shall satisfy such other
requirements as may be prescribed by the Secretary of the
Treasury.
(c) "Actual Deferral Percentage" shall mean, for a
specified group of Participants for a Plan Year, the average of
the ratios (calculated separately for each Participant in such
group) of (1) the amount of Employer Contributions actually paid
over to the Trust Fund on behalf of such Participant for the
Plan Year to (2) the Participant's Compensation for such Plan
Year (whether or not the Employee was a Participant for the
entire Plan Year). Employer Contributions on behalf of any
Participant shall include: (1) any Elective Deferrals made
pursuant to the Participant's Salary Reduction Agreement,
including Excess Elective Deferrals of Highly Compensated
Employees, but excluding Elective Deferrals that are taken into
account in the Contribution Percentage test (provided the ADP
test is satisfied both with and without exclusion of these
Elective Deferrals): and (2) at the election of the Employer,
Qualified Non-elective Contributions and Qualified Matching
Contributions. For purposes of computing Actual Deferral
Percentages, an Employee who would be a Participant but for the
failure to make Elective Deferrals shall be treated as a
Participant on whose behalf no Elective Deferrals are made.
6.05 Distribution of Excess Contributions.
------------------------------------
Notwithstanding any other provision of this plan,
Excess Contributions, plus any income and minus any loss
allocable thereto, shall be distributed no later than the last
day of each Plan Year to Participants to whose Accounts such
Excess Contributions were allocated for the preceding Plan
Year. If such excess amounts are distributed more than 2-1/2
months after the last day of the Plan Year in which such excess
amounts arose, a ten (10) percent excise tax will be imposed on
the Employer maintaining the Plan with respect to such amounts.
Such distributions shall be made to Highly Compensated Employees
on the basis of the respective portions of the Excess
Contributions attributable to each of such Employees. Excess
Contributions shall be allocated to Participants who are subject
to the family member aggregation rules of Section 414(q)(6) of
the Code in the manner prescribed by the regulations.
Excess Contributions (including the amounts
recharacterized) shall be treated as Annual Additions under the
Plan.
6 - 5<PAGE>
<PAGE>
Determination of Income or Loss: Excess Contributions
shall be adjusted for any income or loss up to the date of
distribution. The income or loss allocable to Excess
Contributions is the sum of: (1) income or loss allocable to the
participant's Elective Deferral Account (and, if applicable, the
Qualified Non-elective Contribution account or the Qualified
Matching Contributions account or both) for the Plan Year
multiplied by a fraction, the numerator of which is such
Participant's Excess Contributions for the year and the
denominator is the Participant's Account balance attributable to
Elective Deferrals (and Qualified Non-elective Contributions or
Qualified Matching Contributions, or both, if any of such
contributions are included in the ADP test) without regard to
any income or loss occurring during such Plan Year; and (2) ten
percent of the amount determined under (1) multiplied by the
number of whole calendar months between the end of the Plan Year
and the date of distribution, counting the month of distribution
if distribution occurs after the 15th of such month.
Accounting for Excess Contributions: Excess
Contributions shall be distributed from the Participant's
Elective Deferral Account and Qualified Matching Contribution
account (if applicable) in proportion to the Participant's
Elective Deferrals and Qualified Matching Contributions (to the
extent used in the ADP test) for the Plan Year. Excess
Contributions shall be distributed from the Participant's
Qualified Non-elective Contribution Account only to the extent
that such Excess Contributions exceed the balance in the
Participant's Elective Deferral Account and Qualified Matching
Contribution Account.
"Excess Contributions" shall mean, with respect to
any Plan Year, the excess of:
(a) The aggregate amount of Employer Contributions
actually taken into account in computing the ADP of Highly
Compensated Employees for such Plan Year, over
(b) The maximum amount of such Contributions
permitted by the ADP test (determined by reducing Contributions
made on behalf of Highly Compensated Employees in order of the
ADPS, beginning with the highest of such percentages).
6.06 Recharacterization.
------------------
If the Employer elects in Section 24, Item 7 of the
Adoption Agreement to permit Employees to make Voluntary Non-
deductible Contributions to the Plan, a Participant may treat
his or her Excess Contributions as an amount distributed to the
Participant and then contributed by the Participant to the Plan.
Recharacterized amounts will remain nonforfeitable and subject
to the same distribution requirements as Elective Deferrals.
Amounts may not be recharacterized by a Highly Compensated
Employee to the extent that such amount in combination with
other Employee Contributions made by that Employee would exceed
any stated limit under the plan on Employee Contributions.
6 - 6<PAGE>
<PAGE>
Recharacterization must occur no later than two and
one-half months after the last day of the Plan Year in which
such Excess Contributions arose and is deemed to occur no
earlier than the date the last Highly Compensated Employee is
informed in writing of the amount recharacterized and the
consequences thereof. Recharacterized amounts will be taxable
to the Participant for the Participant's tax year in which the
Participant would have received them in cash.
6.07 Voluntary Non-deductible Contributions.
--------------------------------------
If elected by the Employer in Section 24, Item 7 of
the Adoption Agreement, Employees will be permitted to make
Voluntary Non-deductible Contributions to the Plan. Voluntary
Non-deductible Contributions shall be maintained in a separate
Account pursuant to Section 5.01(b).
6.08 Matching Contributions.
----------------------
If elected by the Employer in Section 24, Item 8 of
the Adoption Agreement, the Employer will make Matching
Contributions to the Plan. Matching Contributions will be
maintained in a separate Account pursuant to Section 5.01(c).
6.09 Forfeitures and Vesting of Matching Contributions.
-------------------------------------------------
Matching Contributions shall be vested in accordance
with Section 24, Item 9 of the Adoption Agreement. In any
event, Matching Contributions shall be fully vested at Normal
Retirement Age, upon the complete or partial termination of the
profit-sharing plan, or upon the complete discontinuance of
Employer Contributions.
Forfeitures of Matching Contributions, other than
Excess Aggregate Contributions, shall be made in accordance with
Section 5.04.
6.10 Qualified Matching Contributions.
--------------------------------
If elected by the Employer in Section 24, Item 4 of
the Adoption Agreement, the Employer will make Qualified
Matching Contributions to the Plan. "Qualified Matching
Contributions" shall mean Matching Contributions which are
subject to the distribution and nonforfeitability requirements
under Section 40l(k) of the Code when made.
6 - 7<PAGE>
<PAGE>
6.11 Limitations on Employee Contributions and Matching
Contributions.
--------------------------------------------------
(a) The ACP for Participants who are Highly
Compensated Employees for each Plan Year and the ACP for
Participants who are Non-highly Compensated Employees for the
same Plan Year must satisfy one of the following tests:
(i) The ACP for Participants who are Highly
Compensated Employees for the Plan Year shall not exceed the
ACP for Participants who are Non-highly Compensated Employees
for the same Plan Year multiplied by 1.25; or
(ii) The ACP for Participants who are Highly
Compensated Employees for the Plan Year shall not exceed the
ACP for Participants who are Non-highly Compensated Employees
for the same Plan Year multiplied by two (2), provided that
the ACP for Participants who are Highly Compensated Employees
does not exceed the ACP for Participants who are Non-highly
Compensated Employees by more than two (2) percentage points.
(b) Special Rules:
-------------
(i) Multiple Use: If one or more Highly
Compensated Employees participate in both a CODA and a plan
subject to the ACP test maintained by the Employer and the
sum of the ADP and ACP of those Highly Compensated Employees
subject to either or both tests exceeds the Aggregate Limit,
then the ACP of those Highly Compensated Employees who also
participate in a CODA will be reduced (beginning with such
Highly Compensated Employee whose ACP is the highest) so that
the limit is not exceeded. The amount by which each Highly
Compensated Employee's Contribution Percentage Amounts is
reduced shall be treated as an Excess Aggregate Contribution.
The ADP and ACP of the Highly Compensated Employees are
determined after any corrections required to meet the ADP and
ACP tests. Multiple use does not occur if either the ADP and
ACP of the Highly Compensated Employees does not exceed 1.25
multiplied by the ADP and ACP of the Non-highly Compensated
Employees.
(ii) For purposes of this Section, the
Contribution Percentage for any Participant who is a Highly
Compensated Employee and who is eligible to have Contribution
Percentage Amounts allocated to his or her account under two
or more plans described in Section 401(a) of the Code, or
arrangements described in Section 401(k) of the Code that are
maintained by the Employer, shall be determined as if the
total of such Contribution Percentage Amounts was made under
each plan. If a Highly Compensated Employee participates in
two or more cash or deferred arrangements that have different
plan years, all
6 - 8<PAGE>
<PAGE>
cash or deferred arrangements ending with or within the same
calendar year shall be treated as a single arrangement.
(iii) In the event that this Plan satisfies the
requirements of Sections 401(m), 401(a)(4) or 410(b) of the
Code only if aggregated with one or more other plans, or if
one or more other plans satisfy the requirements of such
sections of the Code only if aggregated with this Plan, then
this Section shall be applied by determining the Contribution
Percentage of employees as if all such plans were a single
plan. For plan years beginning after December 31, 1989,
plans may be aggregated in order to satisfy Section 401(m) of
the Code only if they have the same plan year.
(iv) For purposes of determining the
Contribution Percentage of a Participant who is a Five-
Percent Owner or one of the ten most highly paid Highly
Compensated Employees, the Contribution Percentage Amounts
and Compensation of such Participant shall include the
Contribution Percentage Amounts and Compensation for the Plan
Year of Family Members (as defined in Section 414(q)(6) of
the Code). Family Members, with respect to Highly
Compensated Employees, shall be disregarded as separate
Employees in determining the Contribution Percentage both for
Participants who are Non-highly Compensated Employees and for
Participants who are Highly Compensated Employees.
(v) For purposes of determining the
Contribution Percentage test, Employee Contributions are
considered to have been made in the Plan Year in which
contributed to the trust. Matching Contributions and
Qualified Non-elective Contributions will be considered made
for a Plan Year if made no later than the end of the twelve-
month period beginning on the day after the close of the Plan
Year.
(vi) The Employer shall maintain records
sufficient to demonstrate satisfaction of the ACP test and
the amount of Qualified Non-elective Contributions or
Qualified Matching Contributions, or both, used in such test.
(vii) The determination and treatment of the
Contribution Percentage of any Participant shall satisfy such
other requirements as may be prescribed by the Secretary of
the Treasury.
(c) Definitions:
-----------
(i) "Aggregate Limit" shall mean the sum of (1) 125
percent of the greater of the ADP of the Non-highly
Compensated Employees for the Plan Year or the ACP of Non-
highly Compensated Employees under the Plan subject to
6 - 9<PAGE>
<PAGE>
Section 401(m) of the Code for the Plan Year beginning with
or within the Plan Year of the CODA and (2) the lesser of
200% or two plus the lesser of such ADP or ACP. "Lesser" is
substituted for "greater" in ("1"), above, and "greater" is
substituted for "lesser" after "two plus the" in "(2)" if it
would result in a larger Aggregate Limit.
(ii) "Average Contribution Percentage" shall
mean the average of the Contribution Percentages of the
Eligible Participants in a group.
(iii) "Contribution Percentage" shall mean the
ratio (expressed as a percentage) of the Participant's
Contribution Percentage Amounts to the Participant's
Compensation for the Plan Year (whether or not the Employee
was a Participant for the entire Plan Year).
(iv) "Contribution Percentage Amounts" shall
mean the sum of the Employee Contributions, Matching
Contributions, and Qualified Matching Contributions (to the
extent not taken into account for purposes of the ADP test)
made under the Plan on behalf of the Participant for the Plan
Year. Such Contribution Percentage Amounts shall include
Forfeitures of Excess Aggregate Contributions or Matching
Contributions allocated to the Participant's Account which
shall be taken into account in the year in which such
Forfeiture is allocated. If so elected in the Adoption
Agreement the Employer may include Qualified Non-elective
Contributions in the Contribution Percentage Amounts. The
Employer also may elect to use Elective Deferrals in the
Contribution Percentage Amounts so long as the ADP test is
met before the Elective Deferrals are used in the ACP test
and continues to be met following the exclusion of those
Elective Deferrals that are used to meet the ACP test.
(v) "Eligible Participant" shall mean any Employee
who is eligible to make an Employee Contribution, or an
Elective Deferral (if the Employer takes such Contributions
into account in the calculation of the Contribution
Percentage), or to receive a Matching Contribution (including
Forfeitures) or a Qualified Matching Contribution. If an
Employee Contribution is required as a condition of
participation in the Plan, any Employee who would be a
Participant in the Plan if such employee made such a
contribution shall be treated as an eligible participant on
behalf of whom no Employee Contributions are made.
(vi) "Employee Contribution" shall mean any
contribution made to the Plan by or on behalf of a
Participant that is included in the Participant's gross
income in the year in which made and that is maintained under
a separate account to which earnings and losses are
allocated.
6 - 10<PAGE>
<PAGE>
(vii) "Matching Contribution" shall mean an Employer
Contribution made to this or any other defined contribution
plan on behalf of a Participant on account of an Employee
Contribution made by such Participant, or on account of a
Participant's Elective Deferral, under a plan maintained by
the Employer.
6.12 Distribution of Excess Aggregate Contributions.
----------------------------------------------
Notwithstanding any other provision of this Plan,
Excess Aggregate Contributions, plus any income and minus any
loss allocable thereto, shall be forfeited, if forfeitable, or
if not forfeitable, distributed no later than the last day of
each Plan Year to Participants to whose Accounts such Excess
Aggregate Contributions were allocated for the preceding Plan
Year. Excess Aggregate Contributions shall be allocated to
Participants who are subject to the Family Member aggregation
rules of Section 414(q)(6) of the Code in the manner prescribed
by the regulations. If such Excess Aggregate Contributions are
distributed more than 2-1/2 months after the last day of the
Plan Year in which such excess amounts arose, a ten (10) percent
excise tax will be imposed on the Employer maintaining the Plan
with respect to those amounts. Excess Aggregate Contributions
shall be treated as Annual Additions under the Plan.
Determination of Income or Loss: Excess Aggregate
Contributions shall be adjusted for any income or loss up to the
date of distribution. The income or loss allocable to Excess
Aggregate Contributions is the sum of: (a) income or loss
allocable to the Participant's Voluntary Contributions Account,
Matching Contributions Account (if any, and if all amounts
therein are not used in the ADP test) and, if applicable,
Qualified Non-elective Contribution Account and Elective
Deferral Account for the Plan Year multiplied by a fraction, the
numerator of which is such Participant's Excess Aggregate
Contributions for the Year and the denominator is the
Participant's Account balance(s) attributable to Contribution
Percentage Amounts without regard to any income or loss
occurring during such Plan Year; and (b) ten percent of the
amount determined under (a) multiplied by the number of whole
calendar months between the end of the Plan Year and the date of
distribution, counting the month of distribution if distribution
occurs after the 15th of such month.
Forfeitures of Excess Aggregate Contributions:
Forfeitures of Excess Aggregate Contributions may either be
reallocated to the Accounts of Non-highly Compensated Employees
or applied to reduce Employer Contributions, as elected by the
Employer in Section 24, Item 10(d) of the Adoption Agreement.
6 - 11<PAGE>
<PAGE>
Accounting for Excess Aggregate Contributions:
Excess Aggregate Contributions shall be forfeited, if
forfeitable or distributed on a prorata basis from the
Participant's Voluntary Contributions Account, Matching
Contributions Account, and Qualified Matching Contributions
Account (and, if applicable, the Participant's Qualified Non-
elective Contributions Account or Elective Deferral Account, or
both).
"Excess Aggregate Contributions" shall mean, with
respect to any Plan Year, the excess of:
(a) The aggregate Contribution Percentage Amounts
taken into account in computing the numerator of the
Contribution Percentage actually made on behalf of Highly
Compensated Employees for such Plan Year, over
(b) The maximum Contribution Percentage Amounts
permitted by the ACP test (determined by reducing contributions
made on behalf of Highly Compensated Employees in order of their
Contribution Percentages beginning with the highest of such
percentages).
Such determination shall be made after first
determining Excess Elective Deferrals pursuant to Section 6.03
and then determining Excess Contributions pursuant to Section
6.05.
6.13 Qualified Non-elective Contributions.
------------------------------------
The Employer may elect to make Qualified Non-elective
Contributions under the Plan on behalf of Employees as provided
in Section 24, Item 3 of the Adoption Agreement.
In addition, in lieu of distributing Excess
Contributions as provided in Section 6.05, or Excess Aggregate
Contributions as provided in Section 6.12 of the Plan, and to
the extent elected by the Employer in Section 24, Item 3 of the
Adoption Agreement, the Employer may make Qualified Non-elective
Contributions on behalf of Non-highly Compensated Employees that
are sufficient to satisfy either the Actual Deferral Percentage
test or the Average Contribution Percentage test, or both,
pursuant to regulations under the Code.
"Qualified Non-elective Contributions" shall mean
contributions (other than Matching Contributions or Qualified
Matching Contributions) made by the Employer and allocated to
Participants' Accounts that the Participants may not elect to
receive in cash until distributed from the Plan; that are
nonforfeitable when made; and that are distributable only in
accordance with the distribution provisions that are applicable
to Elective Deferrals and Qualified Matching Contributions.
6 - 12<PAGE>
<PAGE>
6.14 Nonforfeitability and Vesting.
-----------------------------
The Participant's accrued benefit derived from
Elective Deferrals, Qualified Non-elective Contributions,
Employee Contributions, and Qualified Matching Contributions is
non-forfeitable. Separate Accounts for Elective Deferrals,
Qualified Non-elective Contributions, Employee Contributions,
Matching Contributions, and Qualified Matching Contributions
will be maintained for each Participant. Each Account will be
credited with the applicable contributions and earnings thereon.
6. 15 Distribution Requirements.
-------------------------
Elective Deferrals, Qualified Non-elective
Contributions, and Qualified Matching Contributions, and income
allocable to each are not distributable to a Participant or his
or her Beneficiary or Beneficiaries, in accordance with such
Participant's or Beneficiary or Beneficiaries election, earlier
than Termination of Employment, death, or Disability.
Such amounts may also be distributed upon:
(a) Termination of the Plan without the establishment
of another defined contribution plan.
(b) The disposition by a corporation to an unrelated
corporation of substantially all of the assets (within the
meaning of Section 409(d)(2) of the Code) used in a trade or
business of such corporation if such corporation continues to
maintain this Plan after the disposition, but only with respect
to Employees who continue employment with the corporation
acquiring such assets.
(c) The disposition by a corporation to an unrelated
entity of such corporation's interest in a subsidiary (within
the meaning of Section 409(d)(3) of the Code) if such
corporation continues to maintain this Plan, but only with
respect to Employees who continue employment with such
subsidiary.
(d) The attainment of age 59-1/2 in the case of a
profit-sharing plan.
(e) The hardship of the participant as described in
Section 6.15.
All distributions that may be made pursuant to one
or more of the foregoing distributable events are subject to the
espousal and Participant consent requirements (if applicable)
contained in Sections 401(a)(11) and 417 of the Code.
6 - 13<PAGE>
<PAGE>
6.16 Hardship Distribution.
---------------------
Distribution of Elective Deferrals (and earnings
thereon accrued as of December 31, 1988) may be made to a
Participant in the event of hardship. For the purposes of this
Section, hardship is defined as an immediate and heavy financial
need of the Employee where such Employee lacks other available
resources. Hardship distributions are subject to the espousal
consent requirements contained in Sections 401(a)(11) and 417 of
the Code.
Special Rules:
-------------
(a) The following are the only financial needs
considered immediate and heavy: deductible medical expenses
(within the meaning of Section 213(d) of the Code) of the
Employee, the Employee's Spouse, children, or dependents; the
purchase (excluding mortgage payments) of a principal residence
for the Employee; payment of tuition for the next quarter or
semester of postsecondary education for the Employee, the
Employee's Spouse, children or dependents; or the need to
prevent the eviction of the Employee from, or a foreclosure on
the mortgage of, the Employee's principal residence.
(b) A distribution will be considered as necessary
to satisfy an immediate and heavy financial need of the Employee
only if:
(i) The Employee has obtained all
distributions, other than hardship distributions, and all
nontaxable loans under all plans maintained by the Employer;
(ii) All plans maintained by the Employer
provide that the Employee's Elective Deferrals (and Employee
Contributions) will be suspended for twelve months after the
receipt of the hardship distribution;
(iii) The distribution is not in excess of the
amount of an immediate and heavy financial need; and
(iv) All plans maintained by the Employer
provide that the Employee may not make Elective Deferrals for
the Employee's taxable year immediately following the taxable
year of the hardship distribution in excess of the applicable
limit under Section 402(g) of the Code for such taxable year
less the amount of such Employee's Elective Deferrals for the
taxable year of the hardship distribution.
6.17 Top-heavy Requirements.
----------------------
Neither Elective Deferrals nor Matching Contributions
may be taken into account for the purpose of satisfying the
minimum top-heavy contribution requirement.
6 - 14<PAGE>
<PAGE>
ARTICLE 7
---------
RETIREMENT BENEFITS
-------------------
7.01 Normal Retirement.
-----------------
Each Participant shall be eligible to retire on his
Normal Retirement Date. Such Participant's Account balance
shall be paid in accordance with ARTICLES 10 and 11.
Notwithstanding the other requirements of this Plan, a
Participant who attains his Normal Retirement Age may retire on
his Normal Retirement Date or may elect to continue in Service
subject to the Employer's retirement policy, if any, and the
provisions of the Age Discrimination in Employment Act of 1986.
If such Participant continues in Service, then he shall be
eligible to continue in all respects as a Participant in the
Plan until his actual retirement. Subject to Section 10.07, no
retirement benefit shall be payable until actual retirement
unless such Participant who could take normal retirement
requests that his retirement benefits commence before his actual
retirement. In such case, the Committee shall direct the Trustee
to commence payment of retirement benefits as soon as
practicable following such request.
7.02 Early Retirement.
----------------
If a Participant's Termination of Employment occurs
before the Participant attains his Normal Retirement Age, but
after he has attained his Early Retirement Age as set forth in
Section 13(b) of the Adoption Agreement, if applicable, and he
has completed the required Years of Service set forth in such
Section, if any, the Participant shall be entitled to an Early
Retirement Benefit equal to the value of his Accounts. If the
Employer elected both an age and Service requirement for Early
Retirement in Section 13 of the Adoption Agreement and a
Participant's Termination of Employment occurs before he
satisfies the age requirement for Early Retirement, but after he
satisfies the Service requirement, the Participant will be
entitled to elect an Early Retirement Benefit upon satisfaction
of such age requirement. Such Account balance shall be paid in
accordance with ARTICLES 10 and 11.
7.03 Disability Retirement.
---------------------
A Participant who has incurred a Disability shall be
eligible to retire on the first day of the month next following
the Employer's determination of the Employee's Disability.
Notwithstanding the vesting schedule elected by the Employer in
Section 11 of the Adoption Agreement, an Employee's right to his
or her Account balance shall be nonforfeitable in the event of
Disability. Such Account balance shall be paid in accordance
with ARTICLES 10 and 11.
7 - 1<PAGE>
<PAGE>
ARTICLE 8
---------
DEATH BENEFITS
--------------
8.01 Death Benefit.
-------------
In the event of the death of a Participant before his
retirement, as provided in ARTICLE 7, or other Termination of
Employment prior to any distribution to him of his Accounts,
100 percent of the balance of the Participant's Accounts shall
be paid as provided below, less any amounts to be paid pursuant
to ARTICLE 11:
(a) If the Plan is a profit-sharing plan, then, at
the direction of the Committee, the Trustee shall pay the death
benefit pursuant to Section 10.10 to the deceased Participant's
surviving Spouse unless there is a Qualified Election, as
defined in Section 11.04(c), and, in that case, to the party or
parties designated as Beneficiary.
(b) If the Plan is a money purchase pension plan,
then the Trustee shall pay the death benefit pursuant to Section
10.10.
8.02 Insured Death Benefit.
---------------------
An additional Death Benefit may be provided through
the purchase of life insurance policies if, and as, so provided
in Section 18 of the Adoption Agreement.
(a) Governing Provisions. The following provisions
shall govern the purchase and administration of life insurance
policies hereunder:
(i) Each Participant may request the Employer
to purchase ordinary life, term or universal life insurance
policies on his life as follows:
(1) Ordinary life - For purposes of
these incidental insurance provisions, ordinary life
insurance contracts are contracts with both
nondecreasing death benefits and nonincreasing
premiums. If such contracts are purchased, less
than 1/2 of the aggregate Employer Contributions
allocated to any Participant will be used to pay the
premiums attributable to them.
(2) Term and universal life - No more
than 1/4 of the aggregate Employer Contributions
allocated to any Participant will be used to pay the
premiums on term life insurance contracts, universal
life insurance contracts, and all other life
insurance contracts which are not ordinary life.
8 - 1<PAGE>
<PAGE>
(3) Combination - The sum of 1/2 of
the ordinary life insurance premiums and all other
life insurance premiums will not exceed 1/4 of the
aggregate Employer Contributions allocated to any
Participant.
(ii) Subject to ARTICLE 11, the contracts on a
Participant's life will be converted to cash or an annuity or
distributed to the Participant upon commencement of benefits.
(iii) The Trustee shall apply for and will be
the owner of any insurance contract purchased under the terms
of this Plan. The insurance contract(s) must provide that
proceeds will be payable to the Trustee, however the Trustee
shall be required to pay over all proceeds of the contract(s)
to the Participant's designated Beneficiary in accordance
with the distribution provisions of this Plan. A
Participant's Spouse will be the designated Beneficiary of
the proceeds in all circumstances unless a Qualified Election
has been made in accordance with Section 11.04(c), if
applicable. Under no circumstances shall the Trust Fund
retain any part of the proceeds. In the event of any
conflict between the terms of this Plan and the terms of any
insurance contract purchased hereunder, the Plan provisions
shall control.
(iv) Any dividends or credits earned on life
insurance policies will be allocated to the Accounts derived
from Employer Contributions for whose benefit the policy is
held to reduce premium payments.
(v) Policies shall be purchased for a
Participant only if he provides such evidence of insurability
as may be required by the insurer. If he is not insurable at
standard rates, the policy purchased shall be for such face
amount as can be provided by the amount of premium which
would have been paid if the Participant had been insurable at
standard rates. If the Participant is uninsurable, then no
policies shall be purchased.
(vi) Additional life insurance policies
shall be purchased as of any premium due date only if the
face amount of each additional policy will be at least
$1,000.
(vii) Upon a Participant's Termination of
Employment other than by death or Normal, Early or Disability
Retirement, any nonvested portion of the cash value of any
life insurance policy shall be subject to Forfeiture and
treated in the manner provided in Section 5.04 hereof.
8 - 2<PAGE>
<PAGE>
(b) Vesting and Disposition of Policies.
-----------------------------------
(i) If there are no Employee Contributions, the
cash value of any life insurance policies issued on the life
of a Participant shall be vested as provided in Section 11 of
the Adoption Agreement, but the Trustee shall offer the
policies to the Participant upon his Termination of
Employment for any reason other than death or retirement in
exchange for an amount equal to the nonvested portion of the
total cash value of the policies, if such amount is paid to
the Trustee within 30 days of the date such policies are
offered to the Participant. Subject to the requirements of
ARTICLE 11, if the policies are distributed to him upon his
Termination of Employment without payment by the Participant
of the nonvested portion of the cash value thereof, such
portion shall be charged to the Participant's Employer
Contributions Account.
(ii) If there are Employee Contributions, the
portion of the cash value of any life insurance policies
which is attributable to Employee Contributions shall be 100
percent vested. The portion attributable to Employee
Contributions shall be equal tp the percentage of said cash
value which equals (1) the sum of Employee Contributions
applied to the payment of premiums on said policies divided
by (2) the total premiums paid on said policies. The balance
of the cash value of the life insurance policies which is
attributable to the Employer Contributions shall be vested as
provided in Section 11 of the Adoption Agreement. The
Trustee shall offer the policies to the Participant upon his
Termination of Employment for any reason other than death or
retirement in exchange for an amount equal to the total
nonvested portion of the cash value of the policies, if such
amount is paid to the Trustee within a reasonable time after
the date of his Termination of Employment. Subject to the
provisions of ARTICLE 11, if the policies are distributed to
him upon his Termination of Employment without payment by the
Participant of the nonvested portion of the cash value
thereof, such portion shall be charged to the Participant's
Employer Contributions Account.
(iii) Any policies on the life of a Participant,
the premiums for which have been paid entirely by Employee
Contributions, shall be vested in him upon Termination of
Employment and shall be in addition to all other benefits
provided by the Plan.
8 - 3<PAGE>
<PAGE>
ARTICLE 9
---------
BENEFITS ON SEPARATION FROM SERVICE
-----------------------------------
9.01 Vested Benefit.
--------------
(a) If at a Participant's Termination of Employment
for reasons other than on account of his death he then does not
become entitled to a benefit under ARTICLE 7, he may be entitled
to a Vested Benefit under this Section. Such Vested Benefit
shall be equal to the nonforfeitable percentage of his
Employer-derived Account balance determined in accordance
with the vesting schedule selected in Section 11 of the Adoption
Agreement. Notwithstanding such vesting schedule, an Employee's
right to his or her other Account balances shall be
nonforfeitable upon the attainment of Normal Retirement Age.
Employee-derived Account balances shall be nonforfeitable at all
times.
(b) In the case of a Participant who has five (5)
or more consecutive one (1) year Breaks in Service, all Years of
Service after such Breaks in Service will be disregarded for the
purpose of vesting the Employer-derived Account balance that
accrued before such Breaks in Service. Such Participant's
prebreak Service will count in vesting the post-break Employer-
derived Account balance only if either:
(i) such Participant has any nonforfeitable
interest in the Account balance attributable to Employer
Contributions at the time of Termination of Employment; or
(ii) upon returning to Service the number of
consecutive one (1) year Breaks in Service is less than the
number of Years of Service.
Separate Accounts will be maintained for the Participant's
prebreak and post-break Employer-derived Account balance. Both
Accounts will share in the earnings and losses of the Trust
Fund.
9.02 Forfeitures.
-----------
If a Participant incurs a Termination of Employment,
the non-vested portion of the Participant's Employer Account or
Matching Account, pursuant to Section 9.01, shall be forfeited
on the, earlier of the following dates:
(a) the date the Participant receives a
distribution of the entire vested balance of such Accounts,
pursuant to ARTICLE 10; or
(b) the date the Participant incurs his fifth
consecutive one-year Break in Service.
9 - 1
<PAGE>
<PAGE>
ARTICLE 10
----------
PAYMENT OF BENEFITS
-------------------
10.01 Payment of Benefits.
-------------------
(a) The determination as to the value of an Account
with respect to any benefit hereunder to which a Participant,
Retired Participant or Beneficiary shall have become entitled
shall be based on the balance in the Account on the Allocation
Date preceding the date benefits are paid or commence to be
paid, plus contributions allocated to his Account after such
Allocation Date, less any payments from such Account since such
Allocation Date.
(b) Before payment of any benefit hereunder, written
application therefor shall be made by the Participant or
Beneficiary, as the case may be, and submitted to the Employer
in such form and manner as the Employer shall uniformly
prescribe. Any payment made in accordance 'with the provisions
of the Plan to a Participant or Beneficiary, or to their legal
representative shall, to the extent of the method of computation
as well as the amount thereof, constitute full satisfaction of
all claims hereunder against the Trustee, the Administrator and
the Employer, any of whom may require such Participant,
Beneficiary or legal representative, as a condition precedent to
such payment, to execute a receipt and release therefor in such
form as shall be determined by the Trustee, the Administrator or
the Employer, as the case may be. In the event any benefits are
distributed in the form of annuity contracts, any such contract
or contracts shall be endorsed as non-transferable.
10.02 Time of Payment.
---------------
Payment of benefits under the Plan shall commence in
accordance with the following:
(a) Payment of benefits provided in ARTICLE 7 or
ARTICLE 8 shall commence after the value of the Participant's
Accounts shall have been determined following the date the
Participant is eligible to receive such benefits.
(b) Payment of benefits provided in Section 7.03
or ARTICLE 9 shall commence at the time selected by the Employer
pursuant to Section 13(d) of the Adoption Agreement.
(c) Notwithstanding the foregoing, unless the
Participant elects otherwise, distribution of benefits will
begin no later than the 60th day after the latest of the close
of the Plan Year in which:
10 - 1<PAGE>
<PAGE>
(i) the Participant attains age 65 (or
Normal Retirement Age, if earlier);
(ii) occurs the 10th anniversary of the year
in which the Participant commenced participation in the Plan;
or,
(iii) occurs the Participant's
Termination of Employment.
Notwithstanding the foregoing, the failure of a
Participant and Spouse to consent to a distribution while a
benefit is immediately distributable, within the meaning of
Section 10.03, shall be deemed to be an election to defer
commencement of payment of any benefit sufficient to satisfy
this Section.
10.03 Restrictions on Immediate Distribution.
--------------------------------------
(a) If the value of a Participant's vested Account
balance derived from Employer and Employee Contributions exceeds
(or at the time of any prior distribution exceeded) $3,500, and
the Account balance is immediately distributable, the
Participant and the Participant's Spouse (or where either the
Participant or the spouse has died, the survivor) must consent
to any distribution of such Account balance. The consent of the
Participant and the Participant's Spouse shall be obtained in
writing within the 90-day period ending on the Annuity Starting
Date. The Annuity Starting Date is the first day of the first
period for which an amount is paid as an annuity or any other
form. The Administrator shall notify the Participant and the
Participant's Spouse of the right to defer any distribution
until the Participant's Account balance is no longer immediately
distributable. Such notification shall include a general
description of the material features, and an explanation of the
relative values of, the optional forms of benefit available
under the Plan in a manner that would satisfy the notice
requirements of Section 417(a)(3) of the Code, and shall be
provided no less than 30 days and no more than 90 days prior to
the Annuity Starting Date.
(b) Notwithstanding the foregoing, only the
Participant need consent to the commencement of a distribution
in the form of a Qualified Joint and Survivor Annuity while the
Account balance is immediately distributable. (Furthermore, if
payment in the form of a Qualified Joint and Survivor Annuity is
not required with respect to the Participant pursuant to Section
11.06 of the Plan, only the Participant need consent to the
distribution of an Account balance that is immediately
distributable.) Neither the consent of the Participant nor the
Participant's Spouse shall be required to the extent that a
distribution is required to satisfy Section 40l(k)(9) or 415 of
the Code. In addition, upon termination of this Plan if
10 - 2<PAGE>
<PAGE>
the Plan does not offer an annuity option (purchased from a
commercial provider), the Participant's Account balance may,
without the Participant's consent, be distributed to the
Participant or transferred to another defined contribution plan
(other than an employee stock ownership plan as defined in
Section 4975(e)(7) of the Code) within the same controlled
group.
An Account balance is immediately distributable if
any part of the Account balance could be distributed to the
Participant (or surviving Spouse) before the Participant attains
or would have attained if not deceased) the later of Normal
Retirement Age or age 62.
(c) For purposes of determining the applicability
of the foregoing consent requirements to distributions made
before the first day of the first Plan Year beginning after
December 31, 1988, the Participant's vested Account balance
shall not include amounts attributable to accumulated Deductible
Contributions within the meaning of Section 72(o)(5)(B) of the
Code.
10.04 Termination of Employment Prior to Early Retirement.
---------------------------------------------------
(a) If, at an Employee's Termination of Employment,
the value of the Employee's vested Account balance derived from
Employer and Employee Contributions is not greater than $3,500,
the Employee will receive a distribution of the value of the
entire vested portion of such Account balance and the nonvested
portion will be treated as a Forfeiture. For purposes of this
Section, if the value of an Employee's vested Account balance is
zero, the Employee shall be deemed to have received a
distribution of such vested Account balance. A Participant's
vested Account balance shall not include accumulated Deductible
Contributions within the meaning of Section 72(o)(5)(B) of the
Code for Plan Years beginning prior to January 1, 1989.
(b) If, at an Employee's Termination of Employment,
the Employee elects, in accordance with the requirements of
Section 10.03, to receive the value of his vested Account
balance, the nonvested portion will be treated as a Forfeiture.
If the Employee elects to have distributed less than the entire
vested portion of the Account balance derived from Employer
Contributions, the part of the nonvested portion that will be
treated as a Forfeiture is the total nonvested portion
multiplied by a fraction, the numerator of which is the amount
of the distribution attributable to Employer Contributions and
the denominator of which is the total value of the vested
Employer derived Account balance.
10 - 3<PAGE>
<PAGE>
(c) If an Employee receives a distribution
pursuant to this Section and the Employee resumes employment
covered under this Plan, the Employee's Employer-derived Account
balance will be restored to the amount on the date of
distribution if the Employee repays to the Plan the full amount
of the distribution attributable to Employer Contributions
before the earlier of 5 years after the first date on which the
Participant is subsequently reemployed by the Employer, or the
date the Participant incurs 5 consecutive 1-year Breaks in
Service following the date of the distribution. If an Employee
is deemed to receive a distribution pursuant to this Section,
and the Employee resumes employment covered under this Plan
before the date the Participant incurs 5 consecutive 1-year
Breaks in Service, upon the reemployment of such Employee, the
Employer-derived Account balance of the Employee will be
restored to the amount on the date of such deemed contribution.
10.05 Withdrawal from Employer Account (Non-Integrated
Profits Plans Only).
------------------------------------------------
(a) The Administrator of a nonintegrated
profit-sharing plan may adopt a policy which allows a
Participant to withdraw all or any part of his vested interest
from his Employer Contributions Account and/or his Rollover
Account; provided, however, that the policy shall allow
withdrawals only:
(i) from monies that have been in the Plan for
at least two years, or
(ii) if the Participant has financial need due
to a hardship.
(b) In the event the Administrator adopts a withdrawal
policy, it shall be communicated to all Participants and shall
allow withdrawals in a uniform, nondiscriminatory manner. If
the policy allows withdrawals for hardships, it may include, but
is not limited to, expenses incurred by the Participant for:
(i) education, illness, medical treatment or
hospitalization for the Participant, his Spouse, their
respective parents or dependent children,
(ii) the purchase of a home,
(iii) a casualty loss, or
(iv) an unexpected or unusual expense.
(c) In the event the Administrator adopts a policy
allowing withdrawals, and a Participant withdraws funds from his
Employer Contributions Account which are less than 100 percent
vested at the time of withdrawal, the Committee shall establish
10 - 4<PAGE>
<PAGE>
a separate Account for the Participant and the Participant's
vested portion of the separate Account shall not at any relevant
time be less than an account ("X") determined by the formula: X
= P (AB = (R x D)) - (R x D). For purposes of applying the
formula, P is the vested percentage at the relevant time; D is
the amount of the distributions; R is the ratio of the Account
balance at the relevant time to the Account balance after
withdrawal; and the relevant time is the time at which, under
the Plan, the vested percentage in the Account cannot increase.
10.06 Distribution Requirements.
-------------------------
(a) Subject to ARTICLE 11, the requirements of this
Section shall apply to any distribution of a Participant's
interest and will take precedence over any inconsistent
provisions of this Plan. Unless otherwise specified, the
provisions of this Section apply to calendar years beginning
after December 31, 1984.
(b) All distributions required under this Section
shall be determined and made in accordance with the Proposed
Regulations under Section 401(a)(9) of the Code, including the
minimum distribution incidental benefit requirement of Section
1.401(a)(9)-2 of the Proposed Regulations.
(c) Except as provided in subsection (d), the
Participant shall, subject to the requirements of ARTICLE 11,
select the method of payment of benefits from his Accounts. The
optional forms of benefit provided by this Plan are as follows:
(i) a lump sum distribution, (ii) substantially equal, periodic,
monthly, quarterly, semiannual or annual installments over a
period not exceeding the life expectancy of the Participant or
the life expectancy of the Participant and his designated
Beneficiary, or (iii) the purchase of a single premium
non-transferable annuity contract from a life insurance company,
or (iv) in the case of a profit-sharing plan, nonperiodic
installments to the extent this method complies with Section
401(a)(9) of the Code and Regulations thereunder; provided,
however, that if the contract provides for continuance of
annuity payments after a Participant's death to a Beneficiary
other than the Participant's Spouse, the value of such death
benefit shall be less than the value of the Participant's
annuity.
(d) In the case of a profit-sharing plan or
distribution that meets the safe harbor requirements pursuant to
Section 11.06, the optional forms of benefit provided by this
Plan are as follows: (i) a lump sum distribution, (ii)
substantially equal, periodic, monthly, quarterly, semiannual or
annual installments over a period
10 - 5<PAGE>
<PAGE>
not exceeding the life expectancy of the Participant or the life
expectancy of the Participant and his designated Beneficiary, or
(iii) nonperiodic installments to the extent this method
complies with Section 401(a)(9) of the Code and Regulations
thereunder.
If the Participant elects to receive his benefits
over a period in excess of the Participant's then life
expectancy, the then present value of the payments to be made
over the period of the Participant's then life expectancy must
be more than 50 percent of the then present value of the total
payments to be made to the Participant and his Beneficiary.
10.07 Required Beginning Date.
-----------------------
The entire interest of a participant must be
distributed or begin to be distributed no later than the
Participant's Required Beginning Date (defined below).
10.08 Limits on Distribution Periods.
------------------------------
As of the first Distribution Calendar Year (defined
below), distributions, if not made in a single sum, may only be
made over one of the following periods (or a combination
thereof):
(a) the life of the Participant,
(b) the life of the Participant and a designated
Beneficiary,
(c) a period certain not extending beyond the life
expectancy of the Participant, or
(d) a period certain not extending beyond the joint
and last survivor expectancy of the Participant and a designated
Beneficiary.
10.09 Determination of Amount to be Distributed Each Year.
---------------------------------------------------
If the Participant's interest is to be distributed in
other than a single sum, the following minimum distribution
rules shall apply on or after the Required Beginning Date:
(a) Individual account.
------------------
(i) If a Participant's benefit is to be
distributed over (1) a period not extending beyond the Life
Expectancy (defined below) of the Participant or the joint
life and last survivor expectancy of the Participant and the
Participant's designated Beneficiary or (2) a period not
10 - 6<PAGE>
<PAGE>
extending beyond the Life Expectancy of the designated
Beneficiary, the amount required to be distributed for each
calendar year, beginning with distributions for the first
Distribution Calendar Year, must at least equal the quotient
obtained by dividing the Participant's benefit by the
applicable Life Expectancy.
(ii) For calendar years beginning before
January 1, 1989, if the Participant's Spouse is not the
designated Beneficiary, the method of distribution selected
must assure that at least fifty (50) percent of the present
value of the amount available for distribution is paid within
the Life Expectancy of the Participant.
(iii) For calendar years beginning after
December 31, 1988, the amount to be distributed each year,
beginning with distributions for the first Distribution
Calendar Year shall not be less than the quotient obtained by
dividing the Participant's benefit by the lesser of (1) the
Applicable Life Expectancy or (2) if the Participant's Spouse
is not the designated Beneficiary, the applicable divisor
determined from the table set forth in Q&A-4 of Section
1.401(a)(9)2 of the Proposed Income Tax Regulations.
Distributions after the death of the Participant shall be
distributed using the applicable Life Expectancy in
subsection (i) as the relevant divisor without regard to
Regulations Section 1.401(a)(9)2.
(iv) The minimum distribution required for
the Participant's first Distribution Calendar Year must be
made on or before the Participant's Required Beginning Date.
The minimum distribution for other calendar years, including
the minimum distribution for the Distribution Calendar Year
in which the Employee's Required Beginning Date occurs, must
be made on or before December 31 of that Distribution
Calendar Year.
(b) Other forms. If the Participant's benefit is
distributed in the form of an annuity purchased from an
insurance company, distributions thereunder shall be made in
accordance with the requirements of Section 401(a)(9) of the
Code and the proposed regulations thereunder.
10.10 Death Distribution Provisions.
-----------------------------
(a) Distribution beginning before death. If the
Participant dies after distribution of his or her interest has
begun, the remaining portion of such interest will continue to
be distributed at least as rapidly as under the method of
distribution being used prior to the Participant's death.
10 - 7<PAGE>
<PAGE>
(b) Distribution beginning after death. If the
Participant dies before distribution of his or her interest
begins, distribution of the Participant's entire interest shall
be completed by December 31 of the calendar year containing the
fifth anniversary of the Participant's death except to the
extent that an election is made to receive distributions in
accordance with (i) or (ii) below:
(i) if any portion of the Participant's
interest is payable to a designated Beneficiary,
distributions may be made over the life or over a period
certain not greater than the Life Expectancy of the
designated Beneficiary commencing on or before December 31 of
the calendar year immediately following the calendar year in
which the Participant died,
(ii) if the designated Beneficiary is the
Participant's surviving Spouse, the date distributions are
required to begin in accordance with (i) above shall not be
earlier than the later of (1) December 31 of the calendar
year immediately following the calendar year in which the
Participant died and (2) December 31 of the calendar year in
which the Participant would have attained age 70-1/2.
If the Participant has not made an election
pursuant to this subsection (b) by the time of his or her death,
the Participant's designated Beneficiary must elect the method
of distribution no later than the earlier of (A) December 31 of
the calendar year in which distributions would be required to
begin under this Section, or (B) December 31 of the calendar
year which contains the fifth anniversary of the ' date of death
of the Participant. If the Participant has no designated
Beneficiary, or if the designated Beneficiary does not elect a
method of distribution, distribution of the Participant's entire
interest must be completed by December 31 of the calendar year
containing the fifth anniversary of the Participant's death.
(c) For purposes of subsection (b), if the surviving
Spouse dies after the Participant, but before payments to such
Spouse begin, the provisions of subsection (b), with the
exception of paragraph (ii) therein, shall be applied as if the
surviving Spouse were the Participant.
(d) For purposes of this Section 10. 10, any amount
paid to a child of the Participant will be treated as if it had
been paid to the surviving Spouse if the amount becomes payable
to the surviving Spouse when the child reaches the age of
majority.
(e) For the purposes of this Section 10.10,
distribution of a Participant's interest is considered to begin
on the Participant's Required Beginning Date (or, if subsection
(c) is applicable, the date distribution is required to begin to
10 -8<PAGE>
<PAGE>
the surviving Spouse pursuant to subsection (b)). If
distribution in the form of an annuity irrevocably commences to
the Participant before the Required Beginning Date, the date
distribution is considered to begin is the date distribution
actually commences.
10.11 Definitions.
-----------
(a) Applicable Life Expectancy: The Life Expectancy
(or joint and last survivor expectancy) calculated using the
attained age of the Participant (or designated Beneficiary) as
of the Participant's (or designated Beneficiary's) birthday in
the applicable calendar year reduced by one for each calendar
year which has elapsed since the date Life Expectancy was first
calculated. If Life Expectancy is being recalculated, the
applicable Life Expectancy shall be the life expectancy as so
recalculated. The applicable calendar year shall be the first
Distribution Calendar Year, and if Life Expectancy is being
recalculated such succeeding calendar year.
(b) Designated Beneficiary: The individual who is
designated as the Beneficiary under the Plan in accordance with
Section 401(a)(9) of the Code and the regulations thereunder.
(c) Distribution Calendar Year: A calendar year for
which a minimum distribution is required. For distributions
beginning before the Participant's death, the first Distribution
Calendar Year is the calendar year immediately preceding the
calendar year which contains the Participant's Required
Beginning Date. For distributions beginning after the
Participant's death, the first Distribution Calendar Year is the
calendar year in which distributions are required to begin
pursuant to Section 10.10.
(d) Life Expectancy: Life Expectancy and joint
and last survivor expectancy are computed by use of the expected
return multiples in Tables V and VI of Section 1.72-9 of the
Income Tax Regulations.
Unless otherwise elected by the Participant (or Spouse, in
the case of distributions described in Section 10.10(b)(ii)) by
the time distributions are required to begin, Life Expectancies
shall be recalculated annually. Such election shall be
irrevocable as to the Participant (or Spouse) and shall apply to
all subsequent years. The Life Expectancy of a nonspouse
Beneficiary may not be recalculated.
(e) Participant's Benefit.
---------------------
(i) The account balance as of the last
Allocation Date in the calendar year immediately preceding
the Distribution Calendar Year (Allocation Calendar Year)
increased by the amount of any Contributions or Forfeitures
allocated to
10 - 9<PAGE>
<PAGE>
the Account balance as of dates in the Allocation Calendar
Year after the Allocation Date and decreased by distributions
made in the Allocation Calendar Year after the Allocation
Date.
(ii) Exception for second Distribution Calendar Year.
For purposes of paragraph (i), if any portion of the minimum
distribution for the first Distribution Calendar Year is made
in the second Distribution Calendar Year on or before the
Required Beginning Date, the amount of the minimum
distribution made in the second Distribution Calendar Year
shall be treated as if it had been made in the immediately
preceding Distribution Calendar Year.
(f) Required Beginning Date.
-----------------------
(i) General rule. The Required Beginning
Date of a Participant is the first day of April of the
calendar year following the calendar year in which the
Participant attains age 70-1/2.
(ii) Transitional rules. The Required
Beginning Date of a Participant who attains age 70-1/2 before
January 1, 1988, shall be determined in accordance with (1)
or (2) below:
(1) Non-Five-Percent Owners. The
Required Beginning Date of a Participant who is not
a Five-Percent Owner is the first day of April of
the calendar year following the calendar year in
which the later of retirement or attainment of age
70-1/2 occurs.
(2) Five-Percent Owners. The Required
Beginning Date of a Participant who is a Five-Percent
Owner during any year beginning after December 31,
1979, is the first day of April following the later
of:
(A) the calendar year in which
the Participant attains age 70-1/2, or
(B) the earlier of the calendar
year with or within which ends the Plan Year
in which the Participant becomes a Five-
Percent Owner, or the calendar year in which
the Participant retires.
The Required Beginning Date of a Participant
who is not a Five-Percent Owner who attains age 70-1/2 during
1988 and who has not retired as of January 1, 1989, is April
1, 1990.
10 - 10<PAGE>
<PAGE>
(iii) Five-Percent Owner. A Participant is
treated as a Five-Percent Owner for purposes of this Section
if such Participant is a Five-Percent Owner as defined in
Section 416(i) of the Code (determined in accordance with
Section 416 of the Code but without regard to whether the
Plan is Top-heavy) at any time during the Plan Year ending
with or within the calendar year in which such Five-Percent
Owner attains age 66-1/2 or any subsequent Plan Year.
(iv) Once distributions have begun to a
Five-Percent Owner under this Section, they must continue to
be distributed, even if the Participant ceases to be a Five-
Percent Owner in a subsequent year.
10.12 Transitional Rule.
-----------------
(a) Notwithstanding the other requirements of this
ARTICLE and subject to the requirements of ARTICLE 11,
distribution on behalf of any Employee, including a Five-Percent
Owner, may be made in accordance with all of the following
requirements (regardless of when such distribution commences):
(i) The distribution by the trust is one which
would not have disqualified such trust under Section
401(a)(9) of the Code as in effect prior to amendment by the
Deficit Reduction Act of 1984.
(ii) The distribution is in accordance with
a method of distribution designated by the Employee whose
interest in the trust is being distributed or, if the
Employee is deceased, by a Beneficiary of such Employee.
(iii) Such designation was in writing, was
signed by the Employee or the Beneficiary, and was made
before January 1, 1984.
(iv) The Employee had accrued a benefit under
the Plan as of December 31, 1983.
(v) The method of distribution designated
by the Employee or the Beneficiary specifies the time at
which distribution will commence, the period over which
distributions will be made, and in the case of any
distribution upon the Employee's death, the Beneficiaries of
the Employee listed in order of priority.
(b) A distribution upon death will not be covered
by this transitional rule unless the information in the
designation contains the required information described above
with respect to the distributions to be made upon the death of
the Employee.
10 - 11<PAGE>
<PAGE>
(c) For any distribution which commences before
January 1, 1984, but continues after December 31, 1983, the
Employee, or the Beneficiary, to whom such distribution is being
made, will be presumed to have designated the method of
distribution under which the distribution is being made if the
method of distribution was specified in writing and the
distribution satisfies the requirements in subsections (a)(i)
and (v).
(d) If a designation is revoked any subsequent
distribution must satisfy the requirements of Section 401(a)(9)
of the Code and the proposed regulations thereunder. If a
designation is revoked subsequent to the date distributions are
required to begin, the trust must distribute by the end of the
calendar year following the calendar year in which the
revocation occurs the total amount not yet distributed which
would have been required to have been distributed to satisfy
Section 401(a)(9) of the Code and the proposed regulations
thereunder, but for the Section 242(b)(2) election. For
calendar years beginning after December 31, 1988, such
distributions must meet the minimum distribution incidental
benefit requirements in Section 1.401(a)(9)-2 of the proposed
regulations. Any changes in the designation will be considered
to be a revocation of the designation. However, the mere
substitution or addition of another Beneficiary (one not named
in the designation) under the designation will not be considered
to be a revocation of the designation, so long as such
substitution or addition does not alter the period over which
distributions are to be made under the designation, directly or
indirectly (for example, by altering the relevant measuring
life). In the case in which an amount is transferred or rolled
over from one plan to another plan, the rules in Q&A J-2 and Q&A
J-3 shall apply.
10.13 Failure to Locate.
-----------------
If the Participant or Beneficiary to whom benefits
are to be distributed cannot be located, and reasonable efforts
have been made to find him, including the sending of
notification by certified or registered mail to his last known
address, the Administrator may direct the Trustee to treat the
benefits as a Forfeiture for the Plan Year in which the benefit
is no longer immediately distributable (after the Participant
attains the later of (i) Normal Retirement Age or (ii) age 62),
provided, however, that if a benefit is forfeited pursuant to
this Section 10.13, such benefit will be reinstated if a claim
is made by the Participant or Beneficiary.
10.14 Premature Distributions.
-----------------------
Any distribution to a Participant shall be
considered premature, and an additional income tax shall be
imposed which is equal to ten percent of the amount which is
includible in the Participant's gross income, unless the
distribution is:
10 - 12<PAGE>
<PAGE>
(a) made on or after the date on which the
Participant attains age 59-1/2;
(b) made to a Beneficiary of the Participant after
the Participant's death and pursuant to ARTICLE 8;
(c) made to the Participant due to his Disability;
(d) made in a series of substantially equal
periodic payments (not less frequently than annually) for the
life (or life expectancy) of the Participant or the joint lives
(or joint life expectancies) of the Participant and his
Beneficiary after the Participant's Termination of Employment;
(e) made on or after the date on which the
Participant attains age 55 and his subsequent Termination of
Employment;
(f) made to the Participant in an amount not in
excess of the amount allowable as a deduction for federal income
tax purposes for amounts paid during the taxable year for
medical care (determined without regard to whether the
Participant itemizes deductions for such taxable year);
(g) made to an alternate payee pursuant to a
qualified domestic relations order as defined in Section 414(p)
of the Code; or
(h) qualified and is rolled over or transferred to
an individual retirement account or qualified pension or profit-
sharing plan pursuant to Section 402 or 408 of the Code,
whichever is applicable.
10 - 13<PAGE>
<PAGE>
ARTICLE 11
----------
JOINT AND SURVIVOR ANNUITY REQUIREMENTS
---------------------------------------
11.01 Controlling Article.
-------------------
The provisions of this ARTICLE shall apply to any
Participant who is credited with at least one (1) Hour of
Service on or after August 23, 1984, and such other Participants
as provided in Section 11.07. Any annuity contract distributed
herefrom must be non-transferable. The terms of any annuity
contract purchased and distributed by the Plan to a Participant
or Spouse shall comply with the requirements of this Plan.
11.02 Qualified Joint and Survivor Annuity.
------------------------------------
Unless an optional form of benefit is selected
pursuant to a Qualified Election within the ninety (90) day
period ending on the Annuity Starting Date, a married
Participant's vested Account balances will be paid in the form
of a Qualified Joint and Survivor Annuity and an unmarried
Participant's vested Account balances will be paid in the form
of a life annuity. The Participant may elect to have such
annuity distributed upon attainment of the Earliest Retirement
Age under the Plan.
11.03 Qualified Pre-Retirement Survivor Annuity.
-----------------------------------------
Unless an optional form of benefit has been selected
within the Election Period pursuant to a Qualified Election, if
a Participant dies before the Annuity Starting Date then the
Participant's vested Account balances will be applied toward the
purchase of an annuity for the life of the surviving Spouse.
The surviving Spouse may elect to have such annuity distributed
within a reasonable period after the Participant's death. In
lieu of the purchase of an annuity for the life of the surviving
Spouse, the surviving Spouse may elect to have the benefits paid
by one of the methods described in Section 10.06(c).
11.04 Definitions.
-----------
(a) Election Period: The period which begins on
the first day of the Plan Year in which the Participant attains
age 35 and ends on the date of the Participant's death. If a
Participant's Termination of Employment occurs prior to the
first day of the Plan Year in which age 35 is attained, with
respect to the Account balances as of the date of separation,
the election period shall begin on the date of Termination.
11 - 1<PAGE>
<PAGE>
Pre-age 35 waiver: A Participant who will not yet
attain age 35 as of the end of any current Plan Year may make a
special Qualified Election to waive the Qualified Pre-Retirement
Survivor Annuity for the period beginning on the date of such
election and ending on the first day of the Plan Year in which
the Participant will attain age 35. Such election shall not be
valid unless the Participant receives a written explanation of
the Qualified Pre-Retirement Survivor Annuity in such terms as
are comparable to the explanation required under Section
11.05(a). Qualified Pre-Retirement Survivor Annuity coverage
will be automatically reinstated as of the first day of the Plan
Year in which the Participant attains age 35. Any new waiver on
or after such date shall be subject to the full requirements of
this ARTICLE.
(b) Earliest Retirement Age: The earliest date on
which, under the Plan, the Participant could elect to receive
retirement benefits.
(c) Qualified Election: A waiver of a Qualified
Joint and Survivor Annuity or a Qualified Pre-Retirement
Survivor Annuity may be made. Any waiver of a Qualified Joint
and Survivor Annuity or a Qualified Pre-Retirement Survivor
Annuity shall not be effective unless: (i) the Participant's
Spouse consents in writing to the election; (ii) the election
designates a specific Beneficiary, including any class of
Beneficiaries or any contingent Beneficiaries, which may not be
changed without espousal consent (or the Spouse expressly
permits designations by the Participant without any further
espousal consent); (iii) the Spouse's consent acknowledges the
effect of the election; and (iv) the Spouse's consent is
witnessed by a Plan representative or notary public.
Additionally, a Participant's waiver of the Qualified Joint and
Survivor Annuity shall not be effective unless the election
designates a form of benefit payment which may not be changed
without espousal consent (or the Spouse expressly permits
designations by the Participant without any further espousal
consent). If it is established to the satisfaction of a Plan
representative that there is no Spouse or that the Spouse cannot
be located, a waiver will be deemed a Qualified Election.
Any consent by a Spouse obtained under this subsection
(c) (or establishment that the consent of a Spouse may not be
obtained) shall be effective only with respect to such Spouse.
A consent that permits designations by the Participant without
any requirement of further consent by such Spouse must
acknowledge that the Spouse has the right to limit consent to a
specific Beneficiary, and a specific form of benefit where
applicable, and that the Spouse voluntarily elects to relinquish
either or both of such rights. A revocation of a prior waiver
may be made by a Participant without the consent of the Spouse
at any time before
11 - 2<PAGE>
<PAGE>
the commencement of benefits. The number of revocations shall
not be limited. No consent obtained under this provision shall
be valid unless the Participant has received notice as provided
in Section 11.05.
(d) Qualified Joint and Survivor Annuity: An
immediate annuity for the life of the Participant with a
survivor annuity for the life of the Spouse which is not less
than 50 percent and not more than 100 percent of the amount of
the annuity which is payable during the joint lives of the
Participant and the Spouse and which is the amount of benefit
which can be purchased with the Participant's vested Account
balances. The percentage of the survivor annuity under the Plan
shall be 50% (unless a different percentage is elected by the
Employer in Section 19 of the Adoption Agreement).
(e) Spouse (surviving Spouse): The Spouse or
surviving Spouse of the Participant, provided that a former
spouse will be treated as the Spouse or surviving Spouse and a
current spouse will not be treated as the Spouse or surviving
Spouse to the extent provided under a qualified domestic
relations order as described in Section 414(p) of the Code.
(f) Annuity Starting Date: The first day of the
first period for which an amount is paid as an annuity or any
other form.
(g) Vested Account balances: The aggregate value
of the Participant's vested Account balances derived from
Employer and Employee Contributions (including rollovers),
whether vested before or upon death, including the proceeds of
insurance contracts, if any, on the Participant's life. The
provisions of this Section shall apply to a Participant who is
vested in amounts attributable to Employer Contributions,
Employee Contributions (or both) at the time of death or
distribution.
11.05 Notice Requirements.
-------------------
(a) In the case of a Qualified Joint and Survivor
Annuity as described in Section 11.02, the Administrator shall
no less than 30 days and no more than 90 days prior to the
Annuity Starting Date provide each Participant a written
explanation of:
(i) the terms and conditions of a Qualified
Joint and Survivor Annuity;
(ii) the Participant's right to make and the
effect of an election to waive the Qualified Joint and
Survivor Annuity form of benefit;
(iii) the rights of a Participant's Spouse;
and
11 - 3<PAGE>
<PAGE>
(iv) the right to make, and the effect of, a
revocation of a previous election to waive the Qualified
Joint and Survivor Annuity.
(b) In the case of a Qualified Pre-Retirement
Survivor Annuity as described in Section 11.03, the
Administrator shall provide each Participant, within the
applicable period for such Participant a written explanation of
the Qualified Pre-Retirement Survivor Annuity in such terms and
in such manner as would be comparable to the explanation
provided for meeting the requirements of subsection (a)
applicable to a Qualified Joint and Survivor Annuity.
The applicable period for a Participant is whichever
of the following periods ends last: (i) the period beginning
with the first day of the Plan Year in which the Participant
attains age 32 and ending with the close of the Plan Year
preceding the Plan Year in which the Participant attains age 35;
(ii) a reasonable period ending after the individual becomes a
Participant; (iii) a reasonable period ending after Section
417(a)(5) of the Code ceases to apply to the Participant; (iv) a
reasonable period ending after this Section 11.05 first applies
to the Participant. Notwithstanding the foregoing, notice must
be provided within a reasonable period ending after Termination
of Employment in the case of a Participant whose Termination of
Employment occurred before attaining age 35.
For proposes of applying the preceding paragraph, a
reasonable period ending after the enumerated events described
in (ii), (iii) and (iv) is the end of the two-year period
beginning one year prior to the date the applicable event
occurs, and ending one year after that date. In the case of a
Participant's Termination of Employment before the Plan Year in
which age 35 is attained, notice shall be provided within the
two-year period beginning one year prior to Termination and
ending one year after Termination. If such a Participant
thereafter returns to employment with the Employer, the
applicable period for such Participant shall be redetermined.
(c) Notwithstanding the other requirements of this
Section 11.05, the respective notices prescribed by this Section
need not be given to a Participant if (i) the plan "fully
subsidizes" the costs of a Qualified Joint and Survivor Annuity
or Qualified Pre-Retirement Survivor Annuity, and (ii) the Plan
does not allow the Participant to waive the Qualified Joint and
Survivor Annuity or Qualified Pre-Retirement Survivor Annuity
and does not allow a married Participant to designate a
nonspouse Beneficiary. For purposes of this subsection (c), a
plan fully subsidizes the costs of a benefit if no increase in
cost, or decrease in benefits to the Participant may result from
the Participant's failure to elect another benefit.
11 - 4<PAGE>
<PAGE>
11.06 Safe Harbor Rules.
-----------------
(a) This Section shall apply to a Participant in a
profit-sharing plan, and to any distribution, made on or after
the first day of the first Plan Year beginning after December
31, 1988, from or under a separate Account attributable solely
to accumulated Deductible Employee Contributions, and maintained
on behalf of a Participant in a money purchase pension plan,
(including a target benefit plan) if the following conditions
are satisfied: (i) the Participant does not or cannot elect
payments in the form of a life annuity; and (ii) on the death of
a Participant, the Participant's vested Account balances will be
paid to the Participant's surviving Spouse, but if there is no
surviving Spouse, or if the surviving Spouse has consented in a
manner conforming to a Qualified Election, then to the
Participant's designated Beneficiary. The surviving Spouse may
elect to have distribution of the vested Account balances
commence within the 90-day period following the date of the
Participant's death. The Account balances shall be adjusted for
gains or losses occurring after the Participant's death in
accordance with the provisions of the Plan governing the
adjustment of Account balances for other types of distributions.
This Section 11.06 shall not be operative with respect to a
Participant in a profit-sharing plan if the Plan is a direct or
indirect transferee of a defined benefit plan, money purchase
plan, a target benefit plan, stock bonus, or profit-sharing plan
which is subject to the survivor annuity requirements of
Sections 401(a)(11) and 417 of the Code. If this Section 11.06
is operative, ' then the provisions of this ARTICLE, other than
Section 11.07, shall be inoperative.
(b) The Participant may waive the spousal death
benefit described in this Section at any time provided that no
such waiver shall be effective unless it satisfies the
conditions of Section 11.04(c) (other than the notification
requirement referred to therein) that would apply to the
Participant's waiver of the Qualified Pre-Retirement Survivor
Annuity.
(c) For purposes of this Section 11.06, vested
Account balances shall mean in the case of a money purchase
pension plan or a target benefit plan, the Participant's
separate Account balances attributable solely to accumulated
Deductible Contributions. In the case of a profit-sharing plan,
vested Account balances shall have the same meaning as provided
in Section 11.04(g).
11.07 Transitional Rules.
------------------
(a) Any living Participant not receiving benefits
on August 23, 1984, who would otherwise not receive the benefits
prescribed by the previous Sections of this ARTICLE must be
given the opportunity to elect to have the prior Sections of
this ARTICLE
11 - 5<PAGE>
<PAGE>
apply if such Participant is credited with at least one (1) Hour
of Service under this Plan or the predecessor plan (if any) in a
Plan Year beginning on or after January 1, 1976, and such
Participant had at least ten (10) Years of Service at his
Termination of Employment.
(b) Any living Participant not receiving benefits on
August 23, 1984, who was credited with at least one (1) Hour of
Service under this Plan or a predecessor plan (if any) on or
after September 2, 1974, and who is not otherwise credited with
any Service in a Plan Year beginning on or after January 1,
1976, must be given the opportunity to have his benefits paid in
accordance with subsection (d).
(c) The respective opportunities to elect (as
described in subsections (a) and (b)) must be afforded to the
appropriate Participants during the period commencing on August
23, 1984, and ending on the date benefits would otherwise
commence to said Participants.
(d) Any Participant who has elected pursuant to
subsection (b) and any Participant who does not elect under
subsection (a) or who meets the requirements of subsection (a)
except that such Participant does not have at least ten (10)
Years of Service at his Termination of Employment, shall have
his benefits distributed in accordance with all of the following
requirements if benefits would have been payable in the form of
a life annuity:
(i) Automatic joint and survivor annuity. If
benefits in the form of a life annuity become payable to a
married Participant who:
(1) begins to receive payments under
the Plan on or after his Normal Retirement Age; or
(2) dies on or after Normal Retirement
Age while still working for the Employer; or
(3) begins to receive payment on or
after the Qualified Early Retirement Age; or
(4) at his Termination of Employment
on or after attaining his Normal Retirement Age (or
the Qualified Early Retirement Age) and after
satisfying the eligibility requirements for the
payment of benefits under the Plan and thereafter
dies before beginning to receive such benefits;
11 - 6<PAGE>
<PAGE>
then such benefits will be received under this Plan
in the form of a Qualified Joint and Survivor
Annuity, unless the Participant has elected otherwise
during the Election Period. The Election Period must
begin at least six (6) months before the Participant
attains Qualified Early Retirement Age and end not
more than ninety (90) days before the commencement of
benefits. Any election hereunder will be in writing
and may be changed by the Participant at any time.
(ii) Election of early survivor annuity. A
Participant who is employed after attaining the Qualified
Early Retirement Age will be given the opportunity to elect,
during the Election Period, to have a survivor annuity
payable on death. If the Participant elects the survivor
annuity, payments under such annuity must not be less than
the payments which would have been made to the Spouse under
the Qualified Joint and Survivor Annuity if the Participant
had retired on the day before his death. Any election under
this provision will be in writing and may be changed by the
Participant at any time. The Election Period begins on the
later of (1) the 90th day before the Participant attains the
Qualified Early Retirement Age, or (2) the date on which
participation begins, and ends on the date of the
Participant's Termination of Employment.
(iii) For purposes of subsection (d):
(1) Qualified Early Retirement Age is
the latest of:
A) the earliest date under the
Plan, on which the Participant may elect to
receive retirement benefits,
(B) the first day of the 120th
month beginning before the Participant reaches
Normal Retirement Age, or
(C) the date the Participant
begins participation.
(2) Qualified Joint and Survivor Annuity
is an annuity for the life of the Participant with a
survivor annuity for the life of the Spouse as
described in Section 11.04(d).
11 - 7<PAGE>
<PAGE>
ARTICLE 12
---------
LOANS
-----
If permitted in Section 14 of the Adoption Agreement,
the Employer, upon written application of a Participant in such
manner and form as required by the Employer, may, in its sole
discretion, authorize and direct the Trustee to make a loan from
the Trust Fund to the Participant. All loans shall comply with
the following terms and conditions:
(a) Loans shall be made available to all Participants
and Beneficiaries on a reasonably equivalent basis.
(b) Loans shall not be made available to Highly
Compensated Employees in an amount greater than the amount made
available to other Employees.
(c) Loans must be adequately secured and bear a
reasonable interest rate.
(d) No Participant loan shall exceed the amount of the
Participant's vested Account balance.
(e) A Participant must obtain the consent of his or
her Spouse, if any, to use of the Account balance as security
for the loan. Spousal consent shall be obtained no earlier than
the beginning of the 90-day period that ends on the date on
which the loan is to be so secured. The consent must be in
writing, must acknowledge the effect of the loan, and must be
witnessed by a Plan representative or notary public. Such
consent shall thereafter be binding with respect to the
consenting Spouse or any subsequent Spouse with respect to that
loan. A new consent shall be required if the Account balance is
used for renegotiation, extension, renewal, or other revision of
the loan. Notwithstanding the foregoing, this subsection (e)
shall not apply in the case of a profit-sharing plan that meets
the conditions described in Section 11.06.
(f) In the event of default, foreclosure on the note
and attachment of security will not occur until a distributable
event occurs in the Plan.
(g) No loans will be made to any shareholder-employee
or Owner-Employee. For purposes of this requirement, a
shareholder-employee means an employee or officer of an electing
small business (Subchapter S) corporation who owns (or is
considered as owning within the meaning of Section 318(a)(1) of
the Code), on any day during the taxable year of such
corporation, more than five-percent of the outstanding stock of
the corporation.
12 - 1<PAGE>
<PAGE>
If a valid spousal consent has been obtained
in accordance with (e), then, notwithstanding any other
provision of this Plan, the portion of the Participant's vested
Account balance used as a security interest held by the Plan by
reason of a loan outstanding to the Participant shall be taken
into account for purposes of determining the amount of the
Account balance payable at the time of death or distribution,
but only if the reduction is used as repayment of the loan. If
less than 100% of the Participant's vested Account balance
(determined without regard to the preceding sentence) is payable
to the surviving Spouse, then the Account balance shall be
adjusted by first reducing the vested Account balance by the
amount of the security used as repayment of the loan, and then
determining the benefit payable to the surviving Spouse.
No loan to any Participant or Beneficiary can
be made to the extent that such loan when added to the
outstanding balance of all other loans to the Participant or
Beneficiary would exceed the lesser of (i) $50,000 reduced by
the excess (if any) of the highest outstanding balance of loans
during the one year period ending on the day before the loan is
made, over the outstanding balance of loans from the Plan on the
date the loan is made, or (ii) one-half the present value of the
nonforfeitable accrued benefit of the Participant or, if
greater, the total accrued benefit up to $10,000. For the
purpose of the above limitation, all loans from all plans of the
Employer and other Controlled Group Members are aggregated.
Furthermore, any loan shall by its terms require that repayment
(principal and interest) be amortized in level payments, not
less frequently than quarterly, over a period not extending
beyond five years from the date of the loan, unless such loan is
used to acquire a dwelling unit which within a reasonable time
(determined at the time the loan is made) will be used as the
principal residence of the Participant. An assignment or pledge
of any portion of the Participant's interest in the Plan and a
loan, pledge, or assignment with respect to any insurance
contract purchased under the Plan, will be treated as a loan
under this paragraph.
12 - 2<PAGE>
<PAGE>
ARTICLE 13
----------
TOP-HEAVY PLANS
---------------
If the Plan is or becomes Top-heavy in any Plan Year
beginning after December 31, 1983, the provisions of this
ARTICLE 13 will supersede any conflicting provisions in the Plan
or Adoption Agreement.
13.01 Definitions.
-----------
(a) Key Employee: Any Employee or former Employee
(and the Beneficiaries of such Employee) who at any time during
the determination period was (i) an officer of the Employer if
such individual's Compensation exceeds fifty (50) percent of the
dollar limitation under Section 415(b)(1)(A) of the Code, (ii)
an owner (or considered an owner under Section 318 of the Code)
of one of the ten largest interests in the Employer if such
individual's Compensation exceeds the dollar limitation under
Section 415(c) (1)(A) of the Code, (iii) a Five-Percent Owner,
or (iv) a one percent owner of the Employer who has Compensation
of more than $150,000. For purposes of this subsection (a),
Compensation means compensation as defined in Section 415(c)(3)
of the Code, but including amounts contributed by the Employer
pursuant to a salary reduction agreement which are excludible
from the Employees gross income under Section 125, 402(a)(8),
402(h) or 403(b) of the Code. The determination period is the
Plan Year containing the Determination Date and the four (4)
preceding Plan Years. The determination of who is a Key
Employee will be made in accordance with Section 416(i)(1) of
the Code and the regulations thereunder.
(b) Top-heavy Plans: For any Plan Year beginning
after December 31, 1983, this Plan is Top-heavy if any of the
following conditions exists:
(i) If the Top-heavy Ratio for this Plan
exceeds sixty (60) percent and this Plan is not part of any
Required Aggregation Group or Permissive Aggregation Group of
plans.
(ii) If this Plan is a part of a Required
Aggregation Group of plans but not part of a Permissive
Aggregation Group and the Top-heavy Ratio for the group of
plans exceeds sixty (60) percent.
(iii) If this Plan is a part of a Required
Aggregation Group and part of a Permissive Aggregation Group
of plans and the Top-heavy Ratio for the Permissive
Aggregation Group exceeds sixty (60) percent.
13 - 1<PAGE>
<PAGE>
(c) Top-heavy Ratio:
---------------
(i) If the Employer maintains one or more
defined contribution plans (including any simplified employee
pension plan) and the Employer has not maintained any defined
benefit plans which during the five (5) year period ending on
the Determination Date(s) has or has had accrued benefits,
the Top-heavy Ratio for this Plan alone or for the Required
or Permissive Aggregation Group as appropriate is a fraction,
the numerator of which is the sum of the account balances of
all Key Employees as of the Determination Date(s) (including
any part of any account balance distributed in the five (5)
year period ending on the Determination Date(s)), and the
denominator of which is the sum of all account balances
(including any part of any account balance distributed in the
five (5) year period ending on the Determination Date(s)),
both computed in accordance with Section 416 of the Code and
the regulations thereunder. Both the numerator and
denominator of the Top-heavy Ratio are increased to reflect
any contribution not actually made as of the Determination
Date, but which is required to be taken into account on that
date under Section 416 of the Code and the regulations
thereunder.
(ii) If the Employer maintains one or more
defined contribution plans (including any simplified employee
pension plan) and the Employer maintains or has
maintained one or more defined benefit plans which during the
five (5) year period ending on the Determination Date(s) has
or has had any accrued benefits, the Top-heavy Ratio for any.
Required or Permissive Aggregation Group as appropriate is a
fraction, the numerator of which is the sum of the account
balances under the aggregate defined contribution plan or
plans for all Key Employees determined in accordance with
(i), and the present value of accrued benefits under the
aggregated defined benefit plan or plans for all Key
Employees as of the Determination Date(s), and the
denominator of which is the sum of the account balances under
the aggregated defined contribution plan or plans for all
Participants, determined in accordance with (i), and the
present value of accrued benefits under the defined benefit
plan or plans for all Participants as of the Determination
Date(s), all determined in accordance with Section 416 of the
Code and the regulations thereunder. The accrued benefits
under a defined benefit plan in both the numerator and
denominator of the Top-Heavy Ratio are increased for any
distribution of an accrued benefit made in the five (5) year
period ending on the Determination Date.
13 - 2<PAGE>
<PAGE>
(iii) For purposes of (i) and (ii), the value
of account balances and the present value of accrued benefits
will be determined as of the most recent Valuation Date that
falls within or ends with the twelve (12) month period ending
on the Determination Date, except as provided in Section 416
of the Code and the regulations thereunder for the first and
second plan years of a defined benefit plan. The account
balances and accrued benefits of a Participant(1) who is not
a Key Employee but who was a Key Employee in a prior year, or
(2) who has not been credited with at least one Hour of
Service with any Employer maintaining the Plan at any time
during the five (5) year period ending on the Determination
Date will be disregarded. The calculation of the Top-heavy
Ratio and the extent to which distributions, rollovers and
transfers are taken into account will be made in accordance
with Section 416 of the Code and the regulations thereunder.
Deductible Contributions will not be taken into account for
purposes of computing the Top-heavy Ratio. When aggregating
plans, the value of account balances and accrued benefits
will be calculated with reference to the Determination Dates
that fall within the same calendar year.
The accrued benefit of a Participant other than
a Key Employee shall be determined under (A) the method, if
any, that uniformly applies for accrual purposes under all
defined benefit plans maintained by the Employer, or (B) if
there is no such method, as if such benefit accrued not more
rapidly than the slowest accrual rate permitted under the
fractional rule of Section 411(b)(1)(C) of the Code.
(d) Permissive Aggregation Group: The Required
Aggregation Group of plans plus any other plan or plans of the
Employer which, when considered as a group with the Required
Aggregation Group, would continue to satisfy the requirements of
Sections 401(a)(4) and 410 of the Code.
(e) Required Aggregation Group: (i) Each qualified
plan of the Employer in which at least one Key Employee
participates, or participated at any time during the
Determination Period (regardless of whether the Plan has
terminated), and (ii) any other qualified plan of the Employer
which enables a Plan described in (i) to meet the requirements
of Section 401(a)(4) or 410 of the Code.
(f) Determination Date: For any Plan Year subsequent
to the first Plan Year, the last day of the preceding Plan Year.
For the first Plan Year, the last day of that Plan Year.
(g) Valuation Date: The date elected by the Employer
in Section 16 of the Adoption Agreement as of which account
balances or accrued benefits are valued for purposes of
calculating the Top-heavy Ratio.
13 - 3<PAGE>
<PAGE>
(h) Present Value: Present Value shall be based only
on the interest and mortality rates specified in Section 16 of
the Adoption Agreement.
(i) Super Top Heavy Plan: The Plan if it would be a
Top Heavy Plan under Section 13.01(b) hereof if the words
"ninety (90) percent" were substituted for the words "sixty (60)
percent" in Section 13.01(b) hereof.
13.02 Minimum Allocation.
------------------
(a) Except as otherwise provided in subsections (b)
and (c), the Employer Contributions and Forfeitures allocated on
behalf cf any Participant who is not a Key Employee shall not be
less than the lesser of three percent of such Participant's
Compensation or in the case where the Employer has no defined
benefit plan which designates this Plan to satisfy Section 401
of the Code, the largest percentage of Employer Contributions
and Forfeitures, as a percentage of the first $200,000 of the
Key Employee's Compensation, allocated on behalf of any Key
Employee for that Plan Year. The minimum allocation is
determined without regard to any Social Security contribution.
This minimum allocation shall be made even though, under other
Plan provisions, the Participant would not otherwise be entitled
to receive an allocation, or would have received a lesser
allocation for the Plan Year because of (i) the Participant's
failure to complete 1,000 Hours of Service (or any equivalent
provided in the Plan), or (ii) in the case of a CODA, the
Participant's failure to have Elective Deferrals made to the
Plan on his behalf, or (iii) Compensation less than a stated
amount.
(b) For purposes of computing the minimum allocation,
Compensation shall mean compensation as defined in Section 2.13.
If the Plan is a nonstandardized plan, Compensation is to be
computed without reference to the exclusions otherwise permitted
in Section 9 of the Adoption Agreement.
(c) The provision in subsection (a) shall not apply
to any Participant who was not employed by the Employer on the
last day of the Plan Year.
(d) The provision in subsection (a) shall not apply
to any Participant to the extent the Participant is covered
under any other plan or plans of the Employer and the Employer
has provided in Section 16 of the Adoption Agreement that the
minimum allocation or benefit requirement applicable to
Top-heavy plans will be met in the other plan or plans.
(e) The minimum allocation required (to the extent
required to be nonforfeitable under Section 416(b) of the Code)
may not be forfeited under Section 411(a)(3)(B) or (D) of the
Code. For each Plan Year in which the Paired Plans are Top
Heavy, the
13 - 4<PAGE>
<PAGE>
Employer will provide a minimum contribution equal to three (3)
percent of total Compensation for each non-Key Employee who is
entitled to a minimum contribution under Paired Plans #001 or
#003.
13.03 Minimum Vesting Schedule.
------------------------
For any Plan Year in which this Plan is Top-heavy, one
of the minimum vesting schedules as elected by the Employer in
Section 16 of the Adoption Agreement will automatically apply to
the Plan. The minimum vesting schedule applies to all benefits
within the meaning of Section 411(a)(7) of the Code except those
attributable to Employee Contributions, including benefits
accrued before the effective date of Section 416 of the Code and
benefits accrued before the Plan became Top-heavy. Further, no
decrease in a Participant's nonforfeitable percentage may occur
in the event the Plan's status as Top-heavy changes for any Plan
Year. However, this Section does not apply to the Account
balances of any Employee who does not have an Hour of Service
after the Plan has initially become Top-heavy and such
Employee's Account balance attributable to Employer
Contributions and Forfeitures will be determined without regard
to this Section 13.03.
13.04 Special Limitations on Top Heavy Allocations in
Multiple Plans: "Code Section 415(e) Buy-Back".
-----------------------------------------------
If for any Plan Year the Plan is a Top Heavy Plan, and
the Employer maintains or has ever maintained a qualified
defined benefit pension plan, then in applying the limitations
of Section 5.07 the words "100 percent" shall be substituted for
the words "125 percent" in both the Defined Benefit Fraction and
the Defined Contribution Fraction, as such terms are defined in
Section 5.07, unless the Employer elects to "buyback" the use of
the "125 percent" limit with respect to any Plan Year in which
the Plan is not Super Top Heavy by providing minimum benefits in
excess of those otherwise required pursuant to the provisions of
Section 13.02. An Employer accomplishes this "Code Section
415(e) Buy-Back" by electing to retain the use of the "125
percent" limit in Section 16(c)(i) of a nonstandardized Adoption
Agreement or Section 16(b)(i) of a standardized Adoption
Agreement and by agreeing to provide the required increased
minimum benefits according to one (1) of the following methods.
(a) If the Plan is a Paired Plan, then the minimum
accrual provisions of Sections 14.03 shall apply automatically.
13 - 5<PAGE>
<PAGE>
(b) If the Plan is not a Paired Plan, the Employer
may nevertheless elect to provide the minimum accruals set out
in Section 14.03 by electing in Section 16(c)(ii) of a
nonstandardized Adoption Agreement or Section 16(b)(ii) of a
standardized Adoption Agreement to be subject to the Paired Plan
provisions of ARTICLE 14.
(c) If the Plan is not a Paired Plan, the Employer
may elect (by setting out overriding provisions in Section
16(c)(ii) of a non-standardized Adoption Agreement or Section
16(b)(ii) of a standardized Adoption Agreement) to provide the
minimum accruals required by Section 416(h)(2) of the Code by
some method other than that set out in Section 14.03.
If the Plan is one (1) of multiple qualified plans
maintained by the Employer and is not a Paired Plan, nor is to
be considered to be a Paired Plan, and the Employer has not
elected to utilize the Code Section 415(e) Buy-Back provisions,
then the Employer shall provide (by setting out overriding
provisions in Section 16(c)(ii) of a nonstandardized Adoption
Agreement or Section 16(b)(ii) of a standardized Adoption
Agreement) minimum benefit accruals pursuant to Section 416(f)
of the Code.
13 - 6<PAGE>
<PAGE>
ARTICLE 14
----------
PAIRED PLANS
------------
14.01 Paired Plans.
------------
The provisions of this ARTICLE shall apply if either:
(a) this Plan is a Paired Plan or,
(b) this Plan is not a Paired Plan, but is to be
considered to be subject to the Paired Plan provisions of this
ARTICLE under Section 16(c)(ii) of the Adoption Agreement.
Under this ARTICLE, Sections 14.03 and 14.04 shall
apply with respect to Plan Years in which the Plan is considered
as paired hereunder with a defined benefit pension plan
maintained by the Employer, while Sections 14.05 and 14.06 shall
apply with respect to Plan Years in which the Plan is paired, or
considered as paired hereunder with another defined contribution
plan maintained by the Employer, whether or not the Plan is also
considered as paired hereunder with a defined benefit pension
plan.
With respect to such Paired Plans, the term
"Compensation" shall have the meaning set forth in Section
415(c)(3) of the Code.
14.02 Multiple Benefits from Super Top Heavy Paired Plans.
---------------------------------------------------
In any Plan Year in which the Plan is considered to be
a Paired Plan with a defined benefit pension plan, and the Plan
is or becomes a Super Top Heavy Plan, as defined in Section
13.01(i), then the "Code Section 415(e) Buy-Back", as that term
is defined in Section 13.04 hereof, shall not be available.
14.03 Minimum Defined Contribution Plan Allocations
Under Top Heavy Paired Plans with Code Section
415(e) Buy-Back.
----------------------------------------------
In any Plan Year in which the Plan is considered to
be a Paired Plan (or has elected to be treated as a Paired Plan)
with a qualified defined benefit pension plan, when the Plans
are considered Top Heavy Plans, but are not Super Top Heavy
Plans, and the Employer has elected to utilize the Code Section
415(e) Buy-Back, minimum nonintegrated allocations shall be made
under this Section. Each Employee who participates in this
Paired Plan and who also participates in the defined benefit
pension plan
14 - 1<PAGE>
<PAGE>
considered to be a Paired Plan shall receive a minimum
nonintegrated allocation of seven and one-half percent (7-1/2%)
of Compensation under Section 13.02 of this Paired Plan instead
of three percent (3%) of Compensation. Any Employee who is a
Participant otherwise entitled to receive top heavy allocations
from this Paired Plan, but who is not entitled to receive a
minimum benefit from the defined benefit pension plan considered
to be Paired Plan, shall receive a minimum nonintegrated
allocation of four percent (4%) of Compensation under Section
13.02 of this Paired Plan instead of three percent (3%) of
Compensation. Any Employee who is a Participant not entitled to
receive top heavy allocations from this Paired Plan, but who is
entitled to receive a minimum benefit from the defined benefit
pension plan considered to be a Paired Plan, shall receive a
minimum nonintegrated accrued benefit of 3% of the highest five
(5) consecutive year average compensation (not to exceed a
cumulative accrued benefit of thirty percent (30%)).
14.04 Minimum Defined Contribution Plan Allocations Under
Under Super Top Heavy Paired Plans or Without Code
Section 415(e) Buy-Back.
---------------------------------------------------
In any Plan Year in which the Plan is considered to
be a Paired Plan (or has elected to be treated as a Paired Plan)
with a qualified defined benefit pension plan, if the Paired
Plans are considered Super Top Heavy or if the Employer has
elected not to utilize the Code Section 415(e) Buy-Back, then
minimum nonintegrated allocations shall be made under this
Section. Each Employee who is a Participant in this Paired Plan
and who also participates in the defined benefit pension Paired
Plan shall receive a minimum nonintegrated allocation of five
percent (5%) of such Participant's Compensation under Section
13.02 of this Paired Plan instead of three percent (3%) of
Compensation. Any Employee who is a Participant otherwise
entitled to receive top heavy allocations from this Paired Plan,
but who does not participate in the defined benefit pension
Paired Plan, shall receive a minimum nonintegrated allocation of
three percent (3%) of Compensation under 13.02 of this Paired
Plan.
The minimum nonintegrated allocations provided
hereunder shall be made without reference to, or limitation by,
any lesser Employer contribution having been allocated on behalf
of any Key Employee in the Plan.
14.05 Defined Contribution Paired Plan Prevention of
Duplication of Allocations.
----------------------------------------------
In any Plan Year in which the Plan is a Paired Plan
with a defined contribution plan, the Employer shall provide
each Employee who is a Participant in this Paired Plan and who
participates in the other defined contribution Paired Plan the
minimum nonintegrated allocation specified under this ARTICLE
only in that Paired Plan indicated in Section 16(c)(iii) of the
Adoption Agreement.
14 - 2<PAGE>
<PAGE>
14.06 Forfeitures in Profit-Sharing Plans.
-----------------------------------
If this Plan is a profit-sharing Paired Plan, then the
minimum nonintegrated allocations provided by this Plan under
this ARTICLE shall include in their computation Forfeitures.
14.07 Integrated Paired Plans.
-----------------------
If the Paired Plans involve integration with Social
Security, then only one (1) Paired Plan shall be integrated.
14 - 3<PAGE>
<PAGE>
ARTICLE 15
----------
PLAN ADMINISTRATION
-------------------
15.01 Administrator.
-------------
The Employer shall be the Administrator of the Plan
and shall have the sole power, duty and responsibility of
directing the administration of the Plan in accordance with the
provisions herein set forth. Except with respect to rights and
powers expressly or impliedly reserved in the Sponsor to amend
the Plan in order to maintain its status as a Plan qualified and
approved under the Code, and to assist in its interpretation and
administration, the Employer shall have the sole and absolute
right and power to construe and interpret the provisions of the
Plan and administer it for the best interest of its Employees
including, but not limited to, the following powers and duties:
(a) to construe any ambiguity and interpret any
provision of the Plan or supply any omission or reconcile any
inconsistencies in such manner as it deems proper;
(b) to determine eligibility to become a Participant
in the Plan in accordance with its terms;
(c) to decide all questions of eligibility for, and
determine the amount, manner, and time of payment of any
benefits hereunder, and to afford any person dissatisfied with
such decision or determination, upon written notice thereof, the
right to a full and fair hearing thereon;
(d) to establish uniform rules and procedures to be
followed by Participants and Beneficiaries in filing
applications for benefits, in furnishing and verifying proofs
necessary to determine age, and in any other matters required to
administer the Plan;
(e) to adopt such reasonable accounting methods as
it deems necessary or desirable, to receive and review the
annual allocation report on the Plan and to bring up to date the
balances of all Accounts;
(f) to receive and review reports of the financial
condition and of the receipts and disbursements of the Trust
Fund from the Trustee, and to determine and communicate to the
Trustee the long-term and short-term financial goals of the
Plan;
(g) to file such reports and statements, and to make
such disclosures as required by law; and
15 - 1<PAGE>
<PAGE>
(h) to furnish to Participants and Beneficiaries
such information and statements, with respect to the Plan and
their individual interests therein as required by law, and any
additional information as deemed to be appropriate by the
Employer.
All directions by the Employer shall be conclusive
on all parties concerned; including the Trustee, and all
decisions of the Employer as to the facts of any case and the
meaning, intent, or proper construction of any provision of the
Plan, or as to any rule or regulation in its application to any
case shall be final and conclusive; provided, however, that all
rules and decisions of the Employer shall be uniformly and
consistently applied to all Employees in similar circumstances,
and the Employer shall have no power to administratively add to,
subtract from or modify any of the terms of the Plan, or to
change, add to or subtract from any benefits provided by the
Plan, or to waive or fail to apply any requirements of
eligibility for participation or for benefits under the Plan.
15.02 Claims Procedure.
----------------
If, upon application for benefits made by a
Participant or Beneficiary pursuant to Section 10.01(b), the
Employer shall determine that benefits applied for shall be
denied either in whole or in part, the following provisions
shall govern:
(a) Notice of Denial. The Employer shall, upon
its denial of a claim for benefits under the Plan, provide the
applicant with written notice of such denial setting forth:
(i) the specific reason or reasons for the
denial;
(ii) specific reference to pertinent Plan
provisions upon which the denial is based;
(iii) a description of any additional material
or information necessary for the claimant to perfect the
claim, and
(iv) an explanation of the claimant's rights
with respect to the claims review procedure as provided in
subsection (b) of this Section.
(b) Claims Review. Every claimant with respect to
whom a claim is denied shall, upon written notice of such
denial, have the right to:
(i) request a review of the denial of benefits
by written notice delivered to the Employer,
15 - 2<PAGE>
<PAGE>
(ii) review pertinent documents, and
(iii) submit issues and comments in writing.
(c) Decision on Review. The Employer shall, upon
receipt of a request for review submitted by the claimant in
accordance with subsection (b), appoint a committee for the
purpose of conducting such review, and provide the claimant with
written notice of the decision reached by the said Committee
setting forth the specific reasons for the decision and specific
references to the provisions of the Plan upon which the decision
is based. Such notice shall be delivered to the claimant not
later than 60 days following the receipt of the claimant's
request, or, in the event that the Employer shall determine that
a hearing is needed no later than 120 days following the receipt
of such request.
15.03 Records.
-------
All acts, determinations and correspondence with
respect to the Plan shall be duly recorded and all such records,
together with such other documents, including the Plan and all
amendments thereto, if any, pertinent to the Plan or the
administration thereof, shall be preserved in the custody of the
Employer and shall at all reasonable times be made available to
Participants and Beneficiaries for examination.
15.04 Delegation of Authority.
-----------------------
The administrative duties and responsibilities of the
Employer as set forth in this ARTICLE may be delegated by the
Employer in whatever manner it chooses, in whole or in part, to
either a Plan Committee consisting of such persons as the
Employer shall select or an Administrator. The Employer shall
certify to the Trustee in writing as to the membership and
extent of authority of such Committee, or the identity and
extent of authority of such Administrator, and any changes
relative thereto as may occur from time to time. The authority
of either the Committee or the Administrator shall be deemed to
be that of the Employer to the extent so certified by the
Employer. The Trustee shall be entitled to rely on the last
such certification received and to continue to rely thereon
until subsequent written certification to the contrary is
received from the Employer. The Employer shall indemnify and
save harmless either the members of the Committee, and each of
them, or the Administrator from any liability arising from the
effects and consequences of their acts, omissions and conduct in
their official capacity with respect to the Plan and the
administration thereof, except to the extent that such liability
shall result from their own willful misconduct or gross
negligence.
15 - 3<PAGE>
<PAGE>
The Employer, or either the Plan Committee or the
Administrator to which it has delegated its duties and
responsibilities hereunder, may employ such competent agent or
agents as it may deem appropriate or desirable to perform such
ministerial duties or consultative or other services as the
Employer or either its Committee or Administrator may in its
discretion deem necessary to facilitate the efficient and
proper administration of the Plan. The Employer and either its
Committee or Administrator shall be entitled to rely upon all
reports, advice and information furnished by such agent or
agents, and all action taken or suffered by them in good faith
in reliance thereon shall be conclusive upon all agents,
Participants, Retired Participants, Beneficiaries and other
persons interested in the Plan.
15.05 Correction of Errors.
--------------------
If any change in records or error results in any
Participant, Retired Participant or Beneficiary receiving from
the Plan more or less than he would have been entitled to
receive had the records been correct or had the error not been
made, the Employer, upon discovery of such error, shall correct
the error by adjusting, as far as is practicable, the payments
in such a manner that the benefits to which such person was
correctly entitled shall be paid.
15.06 Domestic Relations Orders.
-------------------------
(a) If the Trustee, the Employer, or the Committee
receives a domestic relations order that purports to require the
payment of a Participant's benefits to a person, other than the
Participant, the Committee shall take the following steps:
(i) If benefits are in pay status, the
Committee shall direct the Trustee to account separately for
the amounts that will be payable to the Alternate Payees
(defined below) if the order is a Qualified Domestic
Relations Order (defined below).
(ii) The Committee shall promptly notify the
named Participant and any Alternate Payees of the receipt of
the domestic relations order and of the Committee's
procedures for determining if the order is a Qualified
Domestic Relations Order.
(iii) The Committee shall determine whether the
order is a Qualified Domestic Relations order under the
provisions of Section 414(p) of the Code.
(iv) The Committee shall notify the named
Participant and any Alternate Payees of its determination as
to whether the order meets the requirements of a Qualified
Domestic Relations Order.
15 - 4<PAGE>
<PAGE>
(b) If, within 18 months beginning on the date the
first payment would be made under the domestic relations order
(the "18-Month Period"), the order is determined to be a
Qualified Domestic Relations Order, the Committee shall direct
the Trustee to pay the specified amounts to the persons entitled
to receive the amounts pursuant to the order.
(c) If, within the 18-Month Period (i) the order is
determined not to be a Qualified Domestic Relations Order or
(ii) the issue as to whether the order is a Qualified Domestic
Relations order has not been resolved, the Committee shall
direct the Trustee to pay the amounts (and any interest thereon)
to the Participant or other person who would have been entitled
to such amounts if there had been no order.
(d) If an order is determined to be a Qualified
Domestic Relations Order after the end of the 18-Month Period,
the determination shall be applied prospectively only.
(e) A Qualified Domestic Relation Order shall not
require:
(i) the Plan to provide any type or form of
benefits, or any option, not otherwise provided under the
Plan, or
(ii) the payment of benefits to an Alternate
Payee which are required to be paid to another Alternate
Payee under another order previously determined to be a
Qualified Domestic Relations Order.
(f) In the case of any payment before a Participant
has terminated employment, a Qualified Domestic Relations Order
shall not be treated as failing to meet the requirements of
subparagraph (e)(i) above solely because such order requires
that payment of benefits be made to an Alternate Payee:
(i) on or after the date on which the Participant
attains (or would have attained) the earliest retirement
date, or
(ii) as if the Participant had retired on the
date on which such payment is to begin under such order (but
taking into account only the value of the Participant's
Account on such date).
For this purpose, "earliest retirement date" shall
mean the earlier of: (1) the date on which the Participant is
entitled to a distribution under the Plan, or (2) the later of
the date the Participant attains age fifty (50), or the earliest
date on which the Participant could begin receiving benefits
under the Plan if he terminated employment.
15 - 5<PAGE>
<PAGE>
(g) To the extent provided in a Qualified Domestic
Relations Order, the former spouse of a Participant shall be
treated as a Surviving Spouse for purposes of Sections
401(a)(11) and 417 of the Code.
(h) For the purposes of this Section, the following
terms shall have the following definitions:
Alternate Payee - Any spouse, former spouse,
child or other dependent of a Participant who is recognized
by a domestic relations order as having a right to all or a
portion of the benefits payable under the Plan to the
Participant.
Qualified Domestic Relations Order - Any
domestic relations order or judgment that meets the
requirements set forth in Section 414(p) of the Code.
(i) In addition to the right to all or a portion
of the benefits payable under the Plan to a Participant, an
Alternate Payee shall have the same option of obtaining a loan
from the Plan, pursuant to ARTICLE 12, or directing the
investment of his Account, pursuant to Section 5.08, if such
options are available to Participants.
15 - 6<PAGE>
<PAGE>
ARTICLE 16
----------
THE TRUST
---------
16.01 The Trust.
---------
The Employer which executed an Adoption Agreement and
thus adopted the Plan, thereby established a Trust. By
execution of the Adoption Agreement, the Trustee accepted the
position of trustee thereof, and all the duties and
responsibilities of that position. The Trust Fund shall consist
of such cash and other property as shall be paid or delivered
from time to time by the Employer to the Trustee, together with
the earnings and profits thereon. The Trust Fund shall be held,
managed and administered by the Trustee in trust without
distinction between principal and income in accordance with the
provisions of this Plan, but shall be accounted for separately
by the Trustee as to each Employer which adopts the Plan.
16.02 Contributions to Trustee.
------------------------
Contributions shall be paid to the Trustee in
accordance with the terms of the Plan. It shall be the duty of
the Trustee to receive, hold, invest, reinvest and distribute
the Trust Fund in accordance with the provisions of this Plan.
The Trustee shall be under no duty to enforce payment of any
contribution to the Trust Fund and shall not be responsible for
the adequacy of the Trust Fund to meet and discharge any
liabilities under the Plan.
16.03 Investment Powers.
-----------------
The Trustee, upon its own discretion with respect to
Trust Fund investments, shall, except as otherwise restricted by
law and the provisions hereof and except as provided in Section
16.04, be authorized and empowered:
(a) to invest and reinvest the principal and income
of the Trust Fund in any and all stocks, bonds, mutual funds,
notes, debentures, mortgages, equipment trust certificates,
insurance company contracts and in such other property, real or
personal, investments and securities of any kind, class or
character, including investments and qualifying securities or
realty of the Employer, whether income producing or not, units
of any commingled, common pooled or mutual trust fund described
in this Section, including securities issued by the Trustee (if
the option under Section 5.08 is available to a Participant),
savings accounts, certificates of deposit and time deposits of
the Trustee or other institutions and securities as the Trustee
may at some future date be authorized to make available to the
Trust customer by the Securities and Exchange Commissioner
within the guidelines,
16 - 1<PAGE>
<PAGE>
policies, procedures or approvals of the Comptroller of the
Currency or the Federal Deposit Insurance Corporation; and in
making such investments and reinvestments, the Trustee shall not
be restricted to properties and securities authorized for
investment by Trustees or other fiduciaries by the applicable
statutory legal list of such properties and securities;
(b) to keep such portion of the Trust Fund in cash or
cash balances as deemed to be in the best interest of the Trust;
(c) to sell, exchange, convey, transfer or otherwise
dispose of any property held by it, by private contract or at
public auction;
(d) to vote or to refrain from voting upon any
stocks, bonds or other securities; to give general or special
proxies or powers of attorney with or without power of
substitution; to exercise any conversion privileges,
subscription rights, or other options and to make any payments
incidental thereto; to consent to or otherwise participate in
corporate reorganizations or other changes affecting corporate
securities and to delegate discretionary powers and to pay any
assessments or charges in connection therewith, and generally to
exercise any of the powers of any owner with respect to stocks,
bonds, securities or other property held in the Fund;
(e) to make, execute, acknowledge and deliver any
and all documents of transfer and conveyance and any and all
other instruments that may be necessary or appropriate to carry
out the powers herein granted;
(f) to register any investment of the Trust Fund
in its own name or in the name of a nominee or nominees and to
hold any investment in bearer form, but the books and records of
the Trustee shall at all times show that all such investments
are part of the Trust Fund;
(g) to employ suitable agents and counsel, and to
pay their reasonable expenses and compensation;
(h) to borrow money from time to time for the
purposes of the Trust on such terms and conditions as may be
deemed to be advisable, and for any sum so borrowed to issue its
promissory note as Trustee and to secure the repayment thereof
by pledging all or any part of the Fund; and
(i) to make loans to Participants pursuant to ARTICLE
12 of the Plan and Section 14 of the Adoption Agreement.
16 - 2<PAGE>
<PAGE>
Notwithstanding the foregoing, the Trustee is
specifically authorized to invest the assets of the Trust Fund
in any and all funds, whether or not presently in existence,
which are, or shall be, maintained by the Trustee, including,
without limiting the generality of the foregoing, mutual
commingled, pooled or common Trust Funds, the terms and
conditions of which are, and shall be on a continuing basis,
hereby incorporated by reference as if fully set forth herein.
Further provided, however, that notwithstanding any provision of
the Plan to the contrary, no Trust Fund assets attributable to
individual retirement accounts, if any, shall be invested in
life insurance contracts, and no Trust Fund assets attributable
to either individual retirement accounts or individually
directed account amounts, if any, shall be invested in
"collectibles" (as defined by Section 408(n) of the Code).
16.04 Appointment of Investment Manager.
---------------------------------
The Employer, if it has so elected in Section 17(a)
of the Adoption Agreement, may at any time and from time to time
appoint in writing an Investment Manager or Managers to manage
all or any portion of the assets of the Plan, and may revoke any
such appointment previously made. For purposes hereof, the
Employer shall mean only the entity executing the Adoption
Agreement as "Employer," but shall not mean any organization
executing the Plan as an "Adopting Employer." While such an
appointment is in effect, the relations among the Administrator,
Employer, Investment Manager and Trustee shall be governed by
the following provisions:
(a) The Employer shall certify to the Trustee the
name or names of any Investment Manager appointed by it to
manage the investment or reinvestment of all or any portion of
the Trust Fund. Such certificate shall also state that the
Investment Manager has acknowledged his fiduciary status with
respect to the Plan in writing.
(b) The Trustee shall segregate any portion of the
Trust Fund held by it which will be subject to the management of
an Investment Manager into one or more separate accounts to be
known as investment manager accounts and shall charge any
expenses related to investments directed by an Investment
Manager against such accounts. Each Investment Manager shall
have the right and power to manage the investment and
reinvestment of his investment manager account. The Trustee
shall follow the directions of the Investment Manager with
respect to the account of such Investment Manager and shall not
be obligated to invest or otherwise manage any such investment
manager account. All directions given by an Investment Manager
to the Trustee shall be in writing, signed by an officer or a
partner of the Investment
16 - 3<PAGE>
<PAGE>
Manager or by such other person or persons as may be designated
by such officer or partner. Subject to such conditions as may
be approved by the Employer and Trustee, the Investment Manager
may place direct orders for the purchase or sale of securities
or other property for its investment manager account, provided,
however, that, in the case of an Investment Manager as defined
in Section 2.35(a), the Trustee shall nevertheless retain
custody of the assets comprising said account. In the case of
an Investment Manager defined in Section 2.35(b), the Investment
Manager may be permitted to retain custody of the assets
comprising said account.
(c) If the Employer, by written notice to the
Trustee, terminates the authority of an Investment Manager but
does not appoint a successor to manage the investment and
reinvestment of the account of such Investment Manager, the
portion of the fund then held in such investment manager account
shall return to the unsegregated portion of the Trust Fund and
the Trustee shall have authority to manage the investment and
reinvestment of such account. Until receipt of a written notice
terminating the authority of an Investment Manager, the
Trustee shall be fully protected in relying upon the latest
prior written notice of appointment of an Investment Manager.
(d) Any Investment Manager may, in writing, authorize
the Trustee to invest any portion of his investment manager
account in short-term investments. The Trustee, in its sole
discretion, may make such investments either directly or by
investment collectively with other assets, including but not
limited to investment in any common, commingled, mutual or
pooled trust fund established and maintained by the Trustee for
the investment of funds administered in a fiduciary capacity.
(e) The Trustee shall not be responsible for any loss
caused by its acting upon any notice, direction or certification
of any Investment Manager appointed by the Employer which the
Trustee reasonably believes to be genuine. The Trustee shall
have no duty to question any direction, action or inaction of
any Investment Manager taken as provided in this Section 16.04.
The Trustee shall have no duty to review the securities or other
property held in any investment manager account or to make any
suggestions to any Investment Manager or to the Employer with
respect to the investment, reinvestment, or disposition of
investments in any investment manager account. The Trustee
shall not be responsible for the results arising from the
Trustee's compliance with the instructions of any Investment
Manager.
16 - 4<PAGE>
<PAGE>
(f) The Trustee shall not be responsible for
determining the reasonableness of any compensation paid to or
agreed to be paid to an Investment Manager. Any such
compensation to an Investment Manager shall be paid from the
Trust Fund, if the Administrator so directs.
16.05 Employer-Directed Investments.
-----------------------------
Notwithstanding any other provision of this Plan
except Section 5.08, the Employer shall have the right to direct
in writing the Trustee from time to time to invest the assets of
the Fund in such securities or other investments as the Employer
shall specify in its direction, which may include, but shall not
be limited to, specifying the percentage of assets to be
invested in and among the trust funds authorized for investment
under Section 1603 hereof. Such direction shall be made in such
form and manner as shall be required by the Trustee of the
individual or individuals duly authorized by the Employer.
Directed investments shall be made by the Trustee as
soon as reasonably possible after actual receipt of such
direction; provided, however, the Trustee shall not be liable
for losses due to reasonable delay in the execution of such
directions. Notwithstanding the foregoing, in no event shall a
directed investment be permitted in such an investment that the
Trustee in its sole discretion, deems itself unable to
administer efficiently, properly and conveniently with respect
thereto; provided, however, that the Trustee's acceptance of the
administration of a directed investment shall not be
unreasonably withheld. The Trustee shall be under no duty to
question any such direction of an Employer with respect to
investments, nor shall the Trustee be required to review any
securities or other property held pursuant to written notice.
The Trustee shall not have any liability whatsoever for any
losses which may result from either the Employer's direction or
any investment decision made pursuant to this Section, or for
any loss which may result by reason of the failure of the
Employer to make such directions. Nor shall the Trustee have
any liability or responsibility whatsoever for any disparity
between the performance or rates of investment return of
Employer-directed investments and the Trust Fund in general.
16.06 Insurance Contracts.
-------------------
The Trustee may either invest in life insurance
contracts or may purchase from the life insurance company
specified by the Employer non-transferable annuity contracts if
deemed appropriate and directed by the Employer either to carry
out properly or to safeguard the obligations under the Plan.
16 - 5<PAGE>
<PAGE>
16.07 Custodial Role.
--------------
Notwithstanding any other provisions in this Plan, if
the Trustee is a bank and the bank does not have trust powers
under State and/or Federal banking laws and regulations, but
otherwise qualifies as a Bank under Section 581 of the Code,
then the Trustee will assume the role as a custodian under this
Plan, and all investments shall be handled in accordance with
Section 16.04 and/or Section 5.08, if selected. Furthermore, a
bank or trust company having trust powers shall act as custodian
where Participant or Employer-directed investments are made
under Sections 16.04 and 5.08. The Trustee's responsibilities
will be as provided in Sections 16.04 and 5.08.
16.08 Liability of Trustee.
--------------------
The Trustee shall not be liable for its failure to
carry out the terms of this Agreement, or any instruction or
direction of the Employer (or its agent), or a Participant, when
issued in accordance with this Plan, or for relying upon advice
given by any competent counsel or other agent employed by the
Trustee or Employer, or for the making, retention or sale of any
investment or reinvestment, or for any loss to or diminution of
the Trust Fund, except due to its own negligence, willful mis-
conduct, lack of good faith or conduct otherwise constituting a
breach of fiduciary duty.
16.09 Court Actions.
-------------
As a prerequisite to taking any action hereunder, the
Trustee shall neither be required to receive either any order to
consent of any court, nor shall the Trustee be required to file
any court return or to report to any court.
16.10 Prudent Man Rule.
----------------
In discharging its duties, the Trustee shall act with
the skill, prudence and diligence under the circumstances then
prevailing that a prudent man acting in a like capacity and
familiar with such matters Would use in the conduct of an
enterprise of like character and with like aims:
(a) by diversifying the investments of the Trust,
to the extent the Trustee has the discretionary authority and
responsibility for such investments, so as to minimize the risk
of large losses, unless under the circumstances it is clearly
prudent not to do so; and
(b) in accordance with the documents and instruments
governing the Plan, insofar as such documents and instruments
are consistent with the provisions of ERISA.
16 - 6<PAGE>
<PAGE>
16.11 Prohibited Transactions.
-----------------------
Any other provisions of the Plan and Trust Agreement
to the contrary notwithstanding, neither the Employer, the
Trustee nor any Disqualified Person as defined in Section
4975(d) of the Code may engage, directly or indirectly, in any
of the acts or transactions under Section 4975(c) of the Code
and Section 406 of ERISA for which no exemption is provided by
Section 4975(d) of the Code or Section 408 of ERISA.
16.12 Conflict of Interest.
--------------------
The Trustee, except as expressly permitted in
Section 16.03(a), shall not:
(a) deal with the assets of the Plan in its own
interest or for its own account;
(b) in its individual or in any other capacity,
act in any transaction involving the Plan (or on behalf of a
party or representing a party) where interests are adverse to
the interest of the Plan or the interest of its Participants or
Beneficiaries; or
(c) receive any consideration for its own account
from any party dealing with the Plan in connection with a
transaction involving the assets of the Plan.
Provided, however, that nothing in this Section
shall be construed to preclude the Trustee from receiving
reasonable compensation for services rendered, or for
reimbursement of expenses properly and actually incurred in the
performance of its duties under the Plan.
16.13 Exemptions.
----------
Nothing in this ARTICLE shall be construed to preclude
a transaction which is otherwise prohibited hereunder or under
the Act, provided that the Trustee, or any other interested
party or parties, shall first apply to, and secure from the
Secretary of Labor, an exemption with respect to such
transaction.
16.14 Insurance.
---------
The Trustee may purchase insurance to insure itself,
the Trust Fund, or other fiduciary against. liability or losses
occurring by reason of an act or omission of any fiduciary,
provided that such insurance shall permit recourse by the
insurer against the fiduciary in the case of a breach of
fiduciary duty.
16 - 7<PAGE>
<PAGE>
16.15 Accounts.
--------
The Trustee shall keep accurate and detailed accounts
of all investments, receipts, disbursements and other
transactions hereunder, and all accounts, books and records
relating thereto shall be open to inspection and audit at all
reasonable times by any person designated by the Employer. The
Trust Fund may, at the Trustee's discretion, be administered on
a unit accounting basis and the value of a unit on the date of
adoption or amendment of the Plan shall be as determined by the
Trustee.
16.16 Reports.
-------
Annually, or more frequently if determined by either
the Employer or the Trustee, or as shall be required by law, the
Trustee shall cause a valuation to be made of the Trust Fund at
its fair market value. Within 120 days after the end of the
Plan Year (or on such other date as may be prescribed under
regulations of the Secretary of Labor) and at the time of each
valuation during the Plan Year, the Trustee shall file with the
Employer and certify the accuracy of a written statement setting
forth, for the valuation period, all investments, receipts,
disbursements, and such other information as the Trustee
maintains which the Employer may require from time to time in
order to fulfill its obligations under applicable law. Upon
expiration of 90 days from the date of filing of the statement
as provided herein, the Trustee's liability for any inaccuracies
or omissions appearing upon the face of such statement shall
cease, except as otherwise may be provided by law, and except
with respect to any inaccuracies or omissions as to which the
Employer shall file with the Trustee written objection before
the expiration of such 90-day period.
To the extent consistent with applicable law, each
transaction, whether an increase or a decrease to the Trust
Fund, may be expressed in terms of a number of units computed on
the basis of the unit value determined on the preceding
valuation date. In the event that transactions are reported in
this manner, the Trustee shall state, in addition to such other
information as is required by law, the number of units in the
Trust Fund and the value of a unit on the date of the statement.
16.17 Payments.
--------
The Trustee shall make payment from the Trust Fund to
such persons, in such manner and in such amounts as the Employer
may direct in writing from time to time. The Trustee shall be
fully protected in acting upon any such written direction
without inquiry or investigation, and shall have no duty or
authority to determine the rights or benefits of any Participant
or Beneficiary under the Plan, or to inquire into the right or
power of the Employer to direct any payment from the Fund.
16 - 8<PAGE>
<PAGE>
16.18 Direction of Committee.
----------------------
The Trustee shall be fully protected in relying upon
the written certification of the Employer as to the membership
and extent of authority of any committee duly authorized to act
on its behalf and in continuing to rely thereon until subsequent
certification has been delivered to the Trustee. The Trustee
shall be fully protected in relying and acting upon any written
direction of such committee whose membership and authority has
been certified to the Trustee, and in continuing to so act and
rely until subsequent certification that said authority has been
revoked or modified has been delivered to the Trustee.
16.19 Impossibility of Performance.
----------------------------
In case it becomes impossible for either the Employer
or the Trustee to perform any act under the Plan, that act shall
be performed which in the judgment of the Trustee will most
nearly carry out the intent and purpose of the Plan. All
parties to this Plan or all parties in any way interested in the
Plan shall be bound by any acts performed under such conditions.
16.20 Expenses.
--------
The expenses incurred by the Employer in the
installation, administration and amendment of the Plan shall be
paid from the Trust Fund, unless paid directly by the Employer.
Such compensation to the Trustee as may be set forth in its
published fee schedule or as from time to time agreed upon in
writing from time to time between the Employer and the Trustee
and the expenses incurred by the Trustee in the performance of
its duties, including professional fees of any person, firm or
agent employed by the Trustee to carry out the investment,
management or administrative functions hereunder, and all other
proper charges and disbursements of the Trustee, shall be paid
from the Trust Fund, unless paid directly by the Employer.
16.21 Taxes.
-----
The Trustee shall pay out of the Trust Fund taxes of
any and all kinds including, without limiting the generality of
the foregoing, property taxes and income taxes levied or
assessed under existing or future laws upon or with respect to
the Trust, or any monies, securities or other property forming a
part thereof, or the income therefrom, subject to the terms of
any agreements or contracts made with respect to trust
investments which make other provisions for such tax payments.
The Trustee may assume that any taxes assessed on or with
respect to the Trust or its income are lawfully assessed unless
the Employer shall in writing advise the Trustee that in the
opinion of counsel for the Employer, such taxes are or may be
unlawfully assessed. In the event that the Employer shall so
advise the Trustee, the Trustee shall, if so requested in
16 - 9<PAGE>
<PAGE>
writing by the Employer, contest the validity of such taxes in
any manner deemed appropriate by the Employer or its counsel for
the refund, abatement, reduction or elimination of any such
taxes.
16.22 Resignation or Removal of Trustee.
---------------------------------
The Trustee may resign at any time upon 90 days'
written notice to the Employer. The Trustee may be removed by
the Employer, or the Employer may increase or decrease the
number of Trustees, at any time upon 90 days' written notice
delivered to the Trustee. In the event of such removal or
resignation, the Employer shall designate a Successor Trustee or
other medium of funding under an agreement executed for such
purpose. If the Employer does not so designate such Successor
Trustee or medium of funding within 60 days, the Trustee may
apply to a court of competent jurisdiction for the purpose of
securing the designation of same. Upon the expiration of 90
days from resignation or removal of the Trustee, the Trustee's
liability for any inaccuracies or omissions shall cease, except
as otherwise may be provided by law, and except with respect to
any inaccuracies or omissions as to which the Employer shall
file with the Trustee written objection before the expiration of
such 90-day period.
16.23 Transfer of Assets to a Successor Trustee or Other
Medium of Funding.
--------------------------------------------------
In the event the Employer wishes to continue the Plan
through a Successor Trustee or through another medium of
funding, it may, upon 90 days' written notice and upon
furnishing evidence of the continuation of the Plan through a
Successor Trustee or medium of funding, direct the Trustee to
transfer the assets of the Trust Fund to such Successor Trustee
or medium of funding, in which event the Trustee shall deliver
in cash or in kind the assets of the Trust Fund (less expenses),
including such instruments of conveyance and further assurance
as may be reasonably required for vesting in such Successor
Trustee or other medium of funding all right, title and interest
of the Trustee in assets of the Trust Fund attributable to the
Employer. The transfer of assets under the circumstances above
shall not, within itself, be deemed a termination of the Plan,
or a cessation of Employer Contributions to the Plan. Upon
completion of such transfer of assets, the terms and provisions
of the Plan and of this Agreement shall no longer control with
respect to the Employer or the Plan (or its successor) as it may
be continued by the Employer.
16 - 10<PAGE>
<PAGE>
16.24 Assets of Controlled Group Members.
----------------------------------
A Controlled Group Member with the written approval
of the other Controlled Group Members may direct the Trustee to
commingle the Trust Fund assets of its Plan with those of the
assets of other Controlled Group Members held by the Trustee in
a mutual, commingled, pooled or common Trust Fund; provided,
however, that adequate records shall be maintained at all times
so that it is possible to ascertain and separate the Trust Fund
assets of each Controlled Group Member.
16 - 11<PAGE>
<PAGE>
ARTICLE 17
----------
AMENDMENT OR TERMINATION
------------------------
17.01 Employer's Right to Amend Plan.
------------------------------
(a) The Sponsor may amend any part of the Plan. For
purposes of Sponsor amendments, the mass submitter shall be
recognized as the agent of the Sponsor. If the Sponsor does not
adopt the amendments made by the mass submitter, it will no
longer be identical to or a minor modifier of the mass submitter
plan.
(b) The Employer may (i) change the choice of options
in the Adoption Agreement, (ii) add overriding language in the
Adoption Agreement when such language is necessary to satisfy
Section 415 or 416 of the Code because of the required
aggregation of multiple plans, and (iii) add certain model
amendments published by the Internal Revenue Service which
specifically provide that their adoption will not cause the Plan
to be treated as individually designed. An Employer that amends
the Plan for any other reason, including a waiver of the minimum
funding requirement under Section 412(d) of the Code, will no
longer participate in this master or prototype Plan and will be
considered to have an individually designed plan.
(c) If the Plan's vesting schedule is amended, or the
Plan is amended in any way that directly or indirectly affects
the computation of the Participant's nonforfeitable percentage
or if the Plan is deemed amended by an automatic change to or
from a Top-heavy vesting schedule, each Participant with at
least three (3) Years of Service with the Employer may elect,
within a reasonable period after the adoption of the amendment
or change, to have the nonforfeitable percentage computed under
the Plan without regard to such amendment or change. For
Participants who do not have at least one (1) Hour of Service in
any Plan Year beginning after December 31, 1988, the preceding
sentence shall be applied by substituting "five (5) Years of
Service" for "three (3) Years of Service" where such language
appears.
The period during which the election may be made shall
commence with the date the amendment is adopted or deemed to be
made and shall end on the latest of:
(i) sixty (60) days after the amendment is
adopted;
(ii) sixty (60) days after the amendment
becomes effective; or
17 - 1<PAGE>
<PAGE>
(iii) sixty (60) days after the Participant
is issued written notice of the amendment by the Employer or
Administrator.
(d) No amendment to the Plan shall be effective to
the extent that it has the effect of decreasing a Participant's
accrued benefit. Notwithstanding the preceding sentence, a
Participant's Account balance may be reduced to the extent
permitted under Section 412(c)(8) of the Code. For purposes of
this subsection, a Plan amendment which has the effect of
decreasing a Participant's Account balance or eliminating an
optional form of benefit, with respect to benefits attributable
to Service before the amendment shall be treated as reducing an
accrued benefit. Furthermore, if the vesting schedule of a Plan
is amended, in the case of an Employee who is a Participant as
of the later of the date such amendment is adopted or the date
it becomes effective, the nonforfeitable percentage (determined
as of such date) of such Employee's Employer-derived Accrued
Benefit will not be less than the percentage computed under the
Plan without regard to such amendment.
17.02 Sponsor's Right to Amend Plan.
-----------------------------
The Employer, by its act of adopting the Plan,
expressly delegates to the Sponsor the power and authority to
amend this Master Plan, in whole or in part, at such time or
times and in such manner as the Sponsor shall deem necessary or
desirable. The Sponsor shall promptly notify in writing the
Employer of any such amendment, and upon receipt of such
notification the Employer shall be bound thereby.
17.03 Limitation of Right to Amend.
----------------------------
No amendment shall have the effect of causing or
permitting any part of the Trust Fund to be used for or diverted
to, purposes other than for the exclusive benefit of
Participants, Retired Participants and Beneficiaries, and no
amendment shall have the effect of revesting in the Employer any
portion of the Trust Fund.
17.04 Termination of Plan by Employer.
-------------------------------
(a) Right Reserved. Although the Employer expects
the Plan to be continued indefinitely, it reserves the right to
terminate the Plan at any time by action by the Board and to
discontinue all contributions hereunder in the case of a profit-
sharing plan. If the Plan is a profit-sharing plan, the
Employer reserves the right to temporarily suspend contributions
from time to time as it shall deem appropriate and necessary,
and such suspension of contributions shall not be considered to
be a termination of the Plan. In the event of termination or
partial termination of the Plan, or a complete discontinuance of
17 - 2<PAGE>
<PAGE>
contributions to the Plan, the Employer shall notify the Trustee
in writing of such termination and, prior to any distribution of
assets hereunder, shall file notice, in such form and manner as
is required by law, with the Internal Revenue Service.
(b) Distribution upon Termination. In the event
of the termination or partial termination of the Plan, the
Account balances of each affected Participant shall be
nonforfeitable. In the event of a complete discontinuance of
contributions under a profit-sharing plan, the Account balances
of each affected Participant will be nonforfeitable. The
Employer, by written notice of termination of the Plan, shall
direct the Trustee to reduce such assets of the Trust Fund to
cash which are not designated by the Employer, or, in the case
of a Participant-Directed Investment Account, as provided in
Section 5.08, by the Participant, to be retained for
distribution in kind. The Trustee shall cause a valuation of
the Trust Fund to be made as of the date such assets are reduced
to cash, at which time the balances of Accounts shall be brought
up to date in accordance with Section 5.05. Upon completion of
such accounting and receipt from the Employer of directions as
to the form of distributions, the Trustee shall distribute the
assets of the Trust Fund to the Participants or Beneficiaries,
as the case may be, in accordance with such directions. Each
Participant or Beneficiary who is entitled to receive a
distribution may elect an option in accordance with Section
10.06(c) or (d), whichever applies. The manner in which the
funds are applied in the case of a termination shall be subject
to the requirements of ARTICLE 11.
17.05 Sponsor's Withdrawal of Participation in Master
Plan.
-----------------------------------------------
The Sponsor may withdraw its participation as a
Sponsor of this Plan as a Master Plan. The Sponsor shall notify
each Employer who has adopted the Plan that the Sponsor has
withdrawn its participation. Such an Employer will be deemed to
have an individually-designed plan at that point.
17.06 Failure of Qualification.
------------------------
If the Employer's Plan fails to attain or retain
qualification, such Plan will no longer participate in this
Master/Prototype Plan and will be considered an individually-
designed Plan. If the Employer's Plan fails to attain or retain
qualification, the funds of such plan will be removed from this
Master Trust as soon as administratively feasible.
17.07 Mergers.
-------
In the event of any merger or consolidation with, or
transfer of assets to any other plan, each Participant will
receive a benefit immediately after such merger, consolidation
or transfer (if the Plan then terminated) which is at least
equal to the benefit the Participant was entitled to immediately
before such merger, consolidation or transfer (if the Plan had
then terminated).
17 - 3<PAGE>
<PAGE>
ARTICLE 18
----------
MISCELLANEOUS
-------------
18.01 Liability of Employer.
---------------------
No Employee, Participant, Retired Participant or
Beneficiary shall have any right or claim to any benefit under
the Plan except in accordance with its provisions. The adoption
of the Plan shall neither be construed as creating any contract
of employment between the Employer and any Employee or otherwise
conferring upon any Employee or other person any legal right to
continuation of employment, nor as limiting or qualifying the
right of the Employer to discharge any Employee without regard
to the effect that such discharge might have upon his rights
under the Plan.
18.02 Spendthrift Clause.
------------------
Except for Plan loans to Participants as permitted
by ARTICLE 12 and the assignments provided therefor, no benefit
or interest available hereunder will be subject to assignment or
alienation, either voluntarily or involuntarily. The preceding
sentence shall also apply to the creation, assignment, or
recognition of a right to any benefit payable with respect to a
Participant pursuant to a domestic relations order, unless such
order is determined to be a qualified domestic relations order,
as defined in Section 414(p) of the Code, or any domestic
relations order entered before January 1, 1985.
18.03 Successor Business of Employer.
------------------------------
Unless this Plan is sooner terminated, any
incorporated successor to the business of the Employer may
continue the Plan and such successor shall thereupon succeed to
all the rights, powers and duties of the Employer hereunder.
The employment of any Employee who has continued in the employ
of such successor shall not be deemed to have been terminated or
severed for any purpose hereunder.
In the event that the Employer is reorganized or
dissolved for any reason without any provision being made for
the continuance of this Plan by a successor to the business of
the Employer, the Plan shall terminate and the assets shall be
distributed as provided in Section 17.04(b)hereof.
18 - 1<PAGE>
<PAGE>
18.04 Qualification by the Internal Revenue Service.
---------------------------------------------
This Plan is adopted by the Employer with the intent
that it shall qualify, as provided in Sections 401(a) and 501(a)
of the Code. Therefore, notwithstanding any provision of the
Plan to the contrary, the Employer reserves the right, in the
event of the failure of the Plan to qualify initially, as
evidenced by receipt of a letter from the Internal Revenue
Service that the Plan does not qualify, at its option to do
either of the following:
(a) to withdraw and terminate the Plan and Trust
hereunder, in which event no Participant or Beneficiary shall,
except with respect to a refund of his Employee Account, have
any right or claim hereunder or to any benefit from the Plan
without regard to the provisions of ARTICLE 17 hereof, whereupon
all contributions shall be returned to the Employer, and the
Trustee shall be discharged from all obligations hereunder; or
(b) to amend the Plan in whole or in part,
retroactively or otherwise, as is necessary or advisable so that
the Plan shall qualify and continue to qualify.
18.05 Use Limited to Qualified Trusts.
-------------------------------
This Master Plan shall be made available by the
Sponsor only to Plans established hereunder which shall meet,
and continue to meet, the requirements of Sections 401(a) and
501(a) of the Code. Should this Master Plan be disqualified as
to any adopting Employer, the funds held in Trust on behalf of
said adopting Employer shall be segregated and appropriate
disposition made thereof within a reasonable time after notice
of such adverse determination of disqualification by the
Internal Revenue Service.
18.06 Conflict of Provisions.
----------------------
If any provision or term of this Plan, or of the
Trust Agreement entered into pursuant hereto, is deemed to be at
variance with, or contrary to, any law of the United States or
applicable state law, said provision shall be severable to the
extent it does not disqualify the Plan under Sections 401(a) and
501(a) of the Code and the provision of the law shall be deemed
to govern.
18.07 Definition of Words.
-------------------
Feminine or neuter pronouns shall be substituted for
those of the masculine form, and the plural shall be substituted
for the singular, in any place or places herein where the
context may require such substitution or substitutions.
18 - 2<PAGE>
<PAGE>
18.08 Titles.
------
The titles of ARTICLES and Sections are included
only for convenience and shall not be construed as a part of the
Plan or in any respect to affect or modify its provisions.
18 - 3<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Sponsor hereby establishes this Plan
on this 31st day of May, 1990.
THE SPONSOR:
HOME FEDERAL BANK OF TENNESSEE, FSB
ATTEST: By: ____________________________
__________________________ Title: _________________________
Corporate Trust Executive Vice President
Administrative and Treasurer
Address: 521 Market Street
Knoxville, Tennessee 37902
Telephone: (615) 544-3912<PAGE>
<PAGE>
HOME FEDERAL BANK OF TENNESSEE, FSB
PROTOTYPE DEFINED CONTRIBUTION PLAN AND TRUST
ADOPTION AGREEMENT #001
STANDARDIZED
PROFIT SHARING PLAN
NEWPORT FEDERAL SAVINGS AND LOAN ASSOCIATION
--------------------------------------------
(Name of Employer)
NEWPORT FEDERAL SAVINGS AND LOAN ASSOCIATION
401(K) RETIREMENT PLAN
--------------------------------------------
(Name of Plan)
DEFINED CONTRIBUTION BASIC PLAN DOCUMENT #01<PAGE>
<PAGE>
ADOPTION AGREEMENT
PLAN SPONSOR INFORMATION
Name and Address: Home Federal Bank of Tennessee, FSB
521 Market Street
Knoxville, Tennessee 37902
Telephone Number: (615) 544-3912
Authorized Representative: ___________________________________
The undersigned Employer by executing this Adoption
Agreement hereby adopts the Home Federal Bank of Tennessee, FSB
Prototype Defined Contribution Plan and Trust of which this
Adoption Agreement forms an integral part.
The undersigned Trustee by executing this Adoption
Agreement hereby accepts the duties and responsibilities of this
position with respect to the Prototype Plan.
Wherever the word "Plan" appears herein or in the Prototype
Plan, it shall be deemed to mean the Prototype Plan as adopted
by the Employer, together with all of the definitions and
provisions applicable to it as elected herein.
Limitations with respect to provisions available to the
Employer are set out in parentheses. Marked brackets ( x )
indicate the provisions which do apply to the Plan. Brackets
left unmarked ( ) indicate the provisions which do not apply to
the Plan. Failure to properly fill out the Adoption Agreement
may result in disqualification of the Plan.
The Plan Sponsor will inform the Employer of any amendments
made to the Prototype Plan or of the discontinuance or
abandonment of the Prototype Plan.
Plan Name: Newport Federal Savings and Loan Association
401(k) Retirement Plan
--------------------------------------------
SECTION 1. PLAN INFORMATION
-----------------------------
(a) The Employer hereby
( ) establishes the above named Plan
( x ) amends, restates, and continues the above named
Plan, which was originally effective on January
1, 1986,
1<PAGE>
<PAGE>
( ) amends, restates, and continues the above named
Plan, which was previously named the
________________________________________
____________ and which was originally
effective on _______________, 19___,
by adopting the HOME FEDERAL BANK OF TENNESSEE, FSB
PROTOTYPE DEFINED CONTRIBUTION PLAN AND TRUST.
(b) The Effective Date of this Plan adoption or amendment
shall be effective September 1, 1997.
(c) The Limitation Year shall be
( x ) a calendar year ending on each December 31.
( ) the twelve (12) consecutive month period ending
on ___________________.
If the Employer elects a year other than the calendar
year, such period must be the same for all qualified
plans of the Employer. If the Limitation Year is
amended to a different twelve (12) consecutive month
period, the new Limitation Year must begin on a date
within the Limitation Year in which the amendment is
made.
(d) The Plan Year shall be
( x ) the twelve (12) consecutive month period which
coincides with the Limitation Year.
( ) the twelve (12) consecutive month period
commencing on _____________________ and each
anniversary thereof.
If the first Plan Year is a short Plan Year (less than
twelve (12) consecutive months), the first day of the
short Plan shall be ____________________________.
(e) Three-digit number assigned to the Plan: 002
(f) This Plan
( x ) is not a Paired Plan.
( ) is a Paired Plan.
This Plan is paired with Adoption Agreement #:
( ) 003 or ( ) 005
2<PAGE>
<PAGE>
SECTION 2. EMPLOYER INFORMATION
---------------------------------
Name: Newport Federal Savings and Loan Association
--------------------------------------------
Business address: P.O. Box 249
Newport, TN 37821
-----------------
Telephone number: (423) 623-6088
--------------
Date of incorporation or
commencement of business: -----------------
Federal tax identification number: 62-0309135
----------
Employer's fiscal year end: December 31
-----------
Type of entity:
( x ) Corporation
( ) Subchapter S Corporation
( ) Sole Proprietorship
( ) Partnership
( ) Tax Exempt Organization
( ) Professional Corporation
( ) Professional Association
The Employer contributes to the following additional
pension or profit-sharing plans:
Third National Bank (SunTrust)
------------------------------
Prior Trustee, if applicable: __________________________
SECTION 3. PLAN ADMINISTRATION
--------------------------------
(a) The Trustee shall be:
( x ) Home Federal Bank of Tennessee, FSB
3<PAGE>
<PAGE>
( ) Name:___________________________________
Address: _______________________________
________________________________________
( ) Name:___________________________________
Address: _______________________________
________________________________________
(b) The Plan Administrator shall be:
( ) The Employer, ATTN: Richard Harwood, President
--------------------------
Telephone Number: (423) 623-6088
--------------------------
( ) Other: (specify) --------------------------
Address: --------------------------
--------------------------
Telephone Number: --------------------------
SECTION 4. EMPLOYEE CLASSES EXCLUDED
--------------------------------------
The following class(es) of individuals employed by the
Employer shall not be eligible to participate in the Plan:
( x ) no exclusions.
( ) employees included in a unit of employees
covered by a collective bargaining agreement
between the Employer and Employee
representatives, if retirement benefits were
the subject of good faith bargaining. For
this purpose, the term "Employee
representatives" does not include any
organization more than half of whose members
are employees who are owners, officers or
executives of the Employer.
( ) employees who are nonresident aliens and who
receive no earned income from the Employer
which constitutes income from sources within
the United States.
4<PAGE>
<PAGE>
SECTION 5. ELIGIBILITY
------------------------
(a) Each Employee who is employed on the Effective Date of
the Plan shall be eligible to participate in the Plan
upon meeting the following eligibility requirements:
( x ) attained the age of 21 (cannot exceed 21).
( x ) completed 6 months Year(s) of Service
(cannot exceed one (1) Year unless the Plan
provides a nonforfeitable right to one hundred
percent (100%) of the Participant's Account
balance derived from Employer Contributions
after not more than two (2) Years of Service
in which case up to two (2) Years is
permissible. In addition, if the Employer
adopts the CODA permitting Elective Deferrals
under the Plan, the minimum number of Years of
Service required for participation in the CODA
cannot exceed one (1). If the Year(s) of
Service Employee selected is or includes a
fractional Year, an Employee will not be
required to complete any specified number of
Hours of Service to receive credit for such
fractional Year.)
If this is a continuation of a Predecessor Plan, no
Employee who has been a Participant under the
Predecessor Plan and who is otherwise eligible to
participate in this Plan shall be excluded from
participation because of failure to satisfy the
above age and Service requirements.
(b) Each Employee who is first employed after the
Effective Date of the Plan shall be eligible to
participate in the Plan upon meeting the following
eligibility requirements:
( x ) attained the age of 21 (cannot exceed 21).
( x ) completed 6 months Year(s) of Service
(cannot exceed one (1) Year unless the Plan
provides a nonforfeitable right to one hundred
percent (100%) of the Participant's Account
balance derived from Employer Contributions
after not more than two (2) Years of Service
Service in which case up to two (2) Years is
permissible. In addition, if the Employer
adopts the CODA permitting Elective Deferrals
under the Plan, the minimum number of Years of
Service required for participation in the CODA
cannot exceed one (1). If the Year(s) of
Service selected is or includes a fractional
Year, an
5<PAGE>
<PAGE>
Employee will not be required to complete any
specified number of Hours of Service to
receive credit for such fraction Year.)
(Note: The selection of eligibility requirements in
subsections (a) and (b) cannot discriminate in favor of
Highly Compensated Employees.)
(c) The initial Eligibility Computation Period shall be
the twelve (12) consecutive month period beginning
on the Employment Commencement Date. The succeeding
twelve (12) consecutive month periods shall be as
follows:
( x ) The twelve (12) consecutive month period
beginning on each anniversary of the
Employee's Employment Commencement Date.
( ) Plan Years beginning with the Plan Year in
which occurs the first anniversary of the
Employee's Employment Commencement Date.
(d) The Plan Entry Date shall be as follows:
( ) The Employee's date of hire.
( ) The first day of the Plan Year in which
the Employee meet the Plan's eligibility
requirements.
( ) The first day of the Plan Year coincident with
or immediately following the date the Employee
meets the Plan's eligibility requirements
(note: this option cannot be selected if the
eligibility requirements stated in Sections
5(a) and (b) exceed age 20-1/2 and/or 1/2
Year of Service).
( x ) The first day of the Plan Year or the date six
(6) months after the first day of the Plan
Year coincident with or immediately following
the date the Employee meets the Plan's
eligibility requirements. If the first Plan
year is a short Plan Year (less than twelve
(12) consecutive months), the Entry Date(s)
for the short Plan Year (if the short Plan
Year is six (6) consecutive months or less)
OR the first day of the short Plan Year or the
date six (6) months after the first day of the
short Plan Year (if the short Plan Year is
more than six (6) but less than twelve (12)
consecutive months).
6<PAGE>
<PAGE>
( ) The first day of the Plan Year or the date six
(6) months after the first day of the Plan
Year or the last day of the Plan Year
coincident with or immediately following the
date the Employee meets the Plan's eligibility
requirements. If the first Plan Year is a
short Plan Year (less than twelve (12)
consecutive months), the Entry Date(s) for the
short Plan Year shall be the first day of the
short Plan Year or the last day of the short
Plan Year (if the short Plan Year is six (6)
consecutive months or less) OR the first day
of the short Plan Year or the date six (6)
months after the first day of the short Plan
Year or the last day of the short Plan Year
(if the short Plan Year is more than six (6)
but less than twelve (12) consecutive months).
( ) The first day of the Plan Year nearest the
date the Employee meets the Plan's eligibility
requirements.
SECTION 6. HOURS OF SERVICE
-----------------------------
Service shall be determined on the basis of the method
selected below. Only one method may be selected. The
method selected shall be applied to all Employees covered
under the Plan.
( x ) On the basis of actual hours for which an Employee
is paid or entitled to payment.
( ) On the basis of days worked. An Employee shall be
credited with 10 Hours of Service per day if under
Section 2.33 of the Plan such Employee would be
credited with at least one (1) Hour of Service
during the day.
( ) On the basis of weeks worked. An Employee shall be
credited with forty-five (45) Hours of service per
week if under Section 2.33 of the Plan such
Employee would be credited with at least one (1)
Hour of Service during the week.
( ) On the basis of semi-monthly payroll periods. An
Employee shall be credited with ninety-five (95)
Hours of Service per semi-monthly payroll period
if under Section 2.33 of the Plan such Employee
would be credited with at least one (1) Hour of
Service during the semi-monthly payroll period.
7<PAGE>
<PAGE>
( ) On the basis of months worked. An Employee shall
be credited with one hundred ninety (190) Hours of
Service per month if under Section 2.33 of the Plan
such Employee would be credited with at least one
(1) Hour of Service during the month.
SECTION 7. EMPLOYER CONTRIBUTIONS
-----------------------------------
(a) The Employer shall contribute an amount for each
Plan Year as follows:
( x ) a discretionary amount to be determined
annually by the Board.
( ) ______% of each Participant's
Compensation (maximum of 15%).
( ) ______% of profits in excess of
$___________.
(b) Such contribution
( ) shall
( x ) shall not
come from, and be limited to, Net Profits or
Accumulated Net Profits.
(c) (Note: The following selections are optional.) Net
Profits shall be defined as the amount of net income
of the Employer
( ) determined before contributions to this
Plan in accordance with accounting practices
normally utilized by the Employer
( ) determined before contributions to this Plan
in accordance with accounting practices
normally utilized by the Employer and before
adjustments for
( ) dividends
( ) state income taxes
( ) federal income taxes
( ) excise taxes
8<PAGE>
<PAGE>
excluding, however,
( ) gains or losses on the sale of
capital assets
( ) income or losses from the sale of
marketable securities
( ) dividends from shares of publicly
owned companies
( ) net proceeds of any life insurance
policies held by the Employer
SECTION 8. ALLOCATION OF EMPLOYER CONTRIBUTIONS AND FORFEITURES
- ----------------------------------------------------------------
(a) Active Participants.
(i) For Plan Years beginning before January 1, 1990,
each Participant shall be eligible to share in
Employer Contributions and Forfeitures for the
Plan Year upon meeting the following requirements
(note: choose one or both):
( ) employed by the Employer on the last
day of the Plan Year.
( ) completed at least 1,000 Hours of
Service during the Plan Year.
(ii) For Plan Years beginning on or after January 1,
1990, each Participant shall be eligible to share
in Employer Contributions and Forfeitures for the
Plan Year, excluding, however (note: this
selection is optional):
( x ) Participants who terminate employment
during the Plan Year with not more than
500 Hours of Service and who are not
Employees as of the last day of the Plan
Year.
(b) Allocation of Employer Contributions and Forfeitures.
Employer Contributions and Forfeitures shall be
allocated as follows (note: choose only one method):
( x ) NON-INTEGRATED
--------------
Employer Contributions and Forfeitures shall be
allocated to each eligible Participant in the ratio
that such Participant's Compensation bears to the
Compensation of all Participants. (Note: The
additional participation requirements of Section
13.02(a) of the Plan must be met unless the Employer
maintains a Money Purchase or Target Benefit Pension
Plan and makes the minimum Top-Heavy allocations to
such Plan.)
9<PAGE>
<PAGE>
( ) INTEGRATED
The integration level is equal to:
( ) taxable wage base (the taxable wage base is
the maximum amount of earnings which may be
considered wages for a Year under Section
3121(a)(1) of the Code in effect as of the
beginning of the Plan Year).
( ) $__________ (a dollar amount less than the
taxable wage base).
( ) ________% of the taxable wage base (not to
exceed 100%).
Employer Contributions for the Plan Year plus any
Forfeitures will be allocated to eligible
Participants' Accounts as follows:
STEP ONE: Employer Contributions and Forfeitures will
be allocated to each eligible Participant's Account in
the ratio that each Participant's total Compensation
bears to all Participant's total Compensation, but not
in excess of 3% of each Participant's Compensation.
STEP TWO: Any Employer Contributions and Forfeitures
remaining after the allocation in Step One will be
allocated to each eligible Participant's Account in
the ratio that each Participant's Compensation for the
Plan Year in excess of the integration level bears to
the excess Compensation of all Participants, but not
in excess of 3%.
STEP THREE: Any Employer Contributions and Forfeitures
remaining after the allocation in Step Two will be
allocated to each Participant's Account in the ratio
that the sum of each Participant's total Compensation
and Compensation in excess of the integration level
bears to the sum of all Participants' total
Compensation and Compensation in excess of the
integration level, but not in excess of the maximum
profit-sharing disparity rate.
If the integration level is equal to the taxable wage
base, the maximum profit-sharing disparity rate is
equal to 2.7%.
If the integration level is not equal to the taxable
wage base, the maximum profit-sharing disparity rate
is equal to the percentage determined in accordance
with the table below:
10<PAGE>
<PAGE>
If the integration level:
the applicable
is more than but not more than percentage is:
-----------------------------------------------------
$0 X* 2.7%
X* of TWB 80% of TWB 1.3%
80% of TWB Y** 2.4%
* X = the greater of $10,000 or 20 percent of the TWB
** Y = any amount more than 80% of the TWB but less
than 100% of the TWB.
STEP FOUR: Any remaining Employer Contributions or
Forfeitures will be allocated to each Participant's
Account in the ratio that each Participant's total
Compensation for the Plan Year bears to all
Participant's total Compensation for that Year.
If an Employee's entry date for participation in the
Plan is not the first day of the Plan Year, then the
integration level
( ) shall
( ) shall not
be prorated in the Plan Year in which the Participant
enters or reenters the Plan in the ratio that the
length of the Participant's participation in the Plan
that Plan Year bears to the length of that entire
Plan Year.
(c) Terminated Participants. (Note: These selections
are optional.) Participants who do not meet the
requirements of (a) during the Plan Year shall not
share in Employer Contributions and Forfeitures for
such Plan year except as provided below:
(i) For Plan Years beginning before January 1, 1990,
( ) if, in (a)(i), the Employer selected
the first option only, then a
Participant who terminates employment
during the Plan Year on account of
(choose as many as apply)
( ) death
( ) disability
( ) or retirement
shall be entitled to share in the
Employer Contributions and Forfeitures.
11<PAGE>
<PAGE>
( ) if, in (a)(i), the Employer selected
the both options, then a Participant
who completes 1,000 Hours of Service
during the Plan Year but who terminates
employment during the Plan Year on
account of
( ) death
( ) disability
( ) or retirement
shall be entitled to share in the
Employer Contributions and Forfeitures.
( ) if, in (a)(i), the Employer selected
both options or the second option only,
then a Participant who terminates
employment during the Plan Year on
account of
( ) death
( ) disability
( ) or retirement
and who does not complete 1,000 Hours of
Service during the Plan Year shall be
entitled to share in the Employer
Contributions and Forfeitures.
(ii) For Plan Years beginning on or after January 1,
1990, if the Employer selected the exclusion
option under (a) (ii), such excluded Participants
who terminate employment on account of
( x ) death
( x ) disability
( x ) or retirement
and who do not complete 500 Hours of Service
during the Plan Year shall be entitled to share
in the Employer Contributions and Forfeitures.
12<PAGE>
<PAGE>
(d) Disabled Participants. The Employer may elect to
make non-forfeitable contributions on behalf of Non-
highly Compensated Employees who become disabled.
Such contributions will be made on the basis of the
compensation each such Participant would have
received for the Limitation Year if the Participant
had been paid at the rate of compensation paid
immediately before become totally disabled.
The Employer
( ) will
( x ) will not
make contributions on behalf of disabled Participants.
SECTION 9. COMPENSATION; SPECIAL DEFINITIONS
----------------------------------------------
Compensation shall mean all of each Participant's
( x ) W-2 earnings
( ) compensation (as that term is defined in
Section 415(c)(3) of the Code)
which is actually paid to the Participant during
( ) the Plan Year.
( ) the taxable year ending with or within the Plan
Year.
( ) the Limitation Year ending with or within the Plan
Year.
( x ) the period during the Plan Year the Employee is a
Participant in the Plan.
13<PAGE>
<PAGE>
Compensation
( x ) shall not include
( ) shall include
Employer Contributions made pursuant to a Salary Reduction
Agreement which are not includible in the gross income of
the Employee under Section 125, 402(a)(8), or 402(h) or
403(b) of the Code.
SECTION 10. EMPLOYEE CONTRIBUTION
-----------------------------------
(a) Voluntary Contributions (non-deductible), unless
elected in the CODA Adoption Agreement, are not
permitted for Plan Years beginning after the Plan
Year in which the Plan is adopted.
(b) Deductible Contributions are not permitted for Plan
Years beginning after 1986.
(c) Rollover Contributions
( ) shall be permitted.
( x ) shall be permitted only for those Employees
who have met the eligibility requirements set
forth in Section 5.
( ) shall not be permitted.
(d) Trustee-to-Trustee Transfers
( ) shall be permitted.
The Plan
( ) shall
( ) shall not
accept the transfer of assets from a defined
benefit plan or money purchase pension plan
(including a target benefit plan), or from a
stock bonus or profit-sharing plan which would
otherwise provide for a life annuity form of
payment to the Participant.
( ) shall be permitted only for those Employees
who have met the eligibility requirements
set forth in Section 5.
14<PAGE>
<PAGE>
The Plan
( ) shall
( x ) shall not
accept the transfer of assets from a defined
benefit plan or money purchase pension plan
(including a target benefit plan), or from a
stock bonus or profit-sharing plan which would
otherwise provide for a life annuity form of
payment to the Participant.
( ) shall not be permitted.
SECTION 11. VESTING SCHEDULE
------------------------------
(a) The nonforfeitable interest of each Employee in his
or her Employer Contributions Account balance shall
be determined on the basis of the following (note:
if, under Sections 5(a) and (b) of this Adoption
Agreement, more than one (1) Year of Service is
required, "Nonforfeitable when made" must be
checked):
( ) Nonforfeitable when made.
( ) 100% vesting after ______ (not to exceed 5)
Years of Vesting Service.
( x ) 0% vesting after 1 Year of Vesting Service.
0% vesting after 2 Years of Vesting Service.
20% (not less than 20) vesting after 3 Years
of Vesting Service.
40% (not less than 40) vesting after 4 Years
of Vesting Service.
60% (not less than 60) vesting after 5 Years
of Vesting Service.
80% (not less than 80) vesting after 6 Years
of Vesting Service.
100% vesting after 7 Years of Vesting Service.
15<PAGE>
<PAGE>
(b) For vesting purposes, a Year of Service will be
measured by
( ) the Plan Year.
( ) the twelve (12) consecutive month period
commencing on the Employee's Employment
Commencement Date and each subsequent
twelve (12) consecutive month period
commencing on the anniversary of such date.
SECTION 12. RESTRICTIONS ON YEARS OF VESTING SERVICE
------------------------------------------------------
All of an Employee's Years of Service with the Employer
are counted to determine the nonforfeitable percentage in
the Employee's Account balance derived from Employer
Contributions except:
( x ) Years of Service before age 18;
( ) Years of Service during a period for which the
Employee made no mandatory contributions under
a predecessor plan;
( ) Years of Service before the Employer
maintained this Plan;
( ) Years of Service before the Employer
maintained this Plan or a predecessor plan;
( ) Years of Service before January 1, 1971,
unless the Employee has had at least three (3)
Years of Service after December 31, 1970;
( ) Years of Service before the effective date of
ERISA if such Service would have been disregarded
under the break in service rules of the prior plan
in effect from time to time before such date. For
this purpose, break in service rules are rules
which result in the loss of prior vesting or
benefit accruals, or which deny an Employee
eligibility to participate, by reason of
separation or failure to complete a required period
of service within a specific period of time.
SECTION 13. RETIREMENT AGES
-----------------------------
(a) Normal Retirement. For each Participant, Normal
Retirement Age shall be
16<PAGE>
<PAGE>
( x ) age 65 (not to exceed 65) years.
( ) the later of age ___ (not to exceed 65) years
or the ___ (not to exceed 5th) anniversary of
the first day of the first Plan Year in which
the Participant commenced participation in the
Plan.
(b) Early Retirement.
( ) Not applicable.
( x ) The Early Retirement Age for each Participant
shall be
( ) age ____ years.
( x ) the later of age 55 years and/or
the date he is credited with 10
Years of Service.
(c) Disability. (Note: This selection is optional.) For
purposes of the Plan, Disability shall not include a
physical or mental condition which results directly or
indirectly from
( ) injury intentionally self-inflicted,
( ) injury or disease resulting from military
service, or
( ) injury or disease suffered or contracted
prior to the Employee's Employment
Commencement Date.
(d) Payment of Benefits. Benefits under ARTICLE 10 of the
Plan due a Participant upon Termination of Employment
for a reason other than death, Disability or Normal or
Early Retirement shall be paid to the terminated
Participant or applied for his benefit from his
Account(s) as follows (note: select only one):
( x ) within 60 days following the close of the Plan
Year in which the Participant's Termination of
Employment occurs, or as soon as practicable
thereafter.
( ) within 60 days following the close of the Plan
Year during which the Participant incurs a one
(1) year Break in Service, or as soon as
practicable thereafter.
( ) within 60 days following the close of the Plan
ear during which the terminated Participant
attains what would have been his Normal
Retirement Age.
17<PAGE>
<PAGE>
( ) in a manner uniformly and nondiscriminatorily
established by the Administrator and not
otherwise in contravention of Section 10.02
of the Plan.
SECTION 14. PARTICIPANT LOANS
-------------------------------
Participant loans
( x ) shall be permitted (complete attached Exhibit 1).
( ) shall not be permitted.
SECTION 15. WITHDRAWALS
-------------------------
(a) Employer Contributions (note: if the Plan is
integrated with Social Security, withdrawals are not
permitted)
( ) Withdrawals from a Participant's Employer
Contributions Account shall not be permitted.
( ) Withdrawals of up to _____% (note: not more
than 100%) of a Participant's vested interest
in his Employer Contributions Account shall
be permitted in accordance with Section 10.05
of the Plan.
(b) Employee Contributions
(Note: this section of the Adoption Agreement should
be filled out only if the Plan permitted Employee
Contributions for Plan Years beginning on or before
the Effective Date.)
( ) Withdrawals from a Participant's Employee
Contributions Account shall not be permitted.
( ) Withdrawals of up to ___% (note: not more
than 100%) of a Participant's Employee
Contributions Account may be permitted.
(c) Rollover Contributions
(Note: this section of the Adoption Agreement should
be filled out only if Rollover Contributions are a
feature of this Plan.)
( ) Withdrawals from a Participant's Rollover
Account shall not be permitted.
( x ) Withdrawals of up to 100% (note: not more than
100%) of a Participant's Rollover Account may
be permitted.
18<PAGE>
<PAGE>
SECTION 16. TOP-HEAVY PLANS
-----------------------------
This section automatically applies only in Plan Years in
which the Plan is Top-Heavy, but all options herein must
be completed in case the Plan ever becomes Top-Heavy.
(a) Single Plan-Minimum Contributions and Allocations.
Notwithstanding the provisions of Section 8, and
before any contributions are allocated thereunder,
minimum Employer Contributions shall be made and
allocated pursuant to Section 13.02 of the Plan in a
Plan Year in which the Plan is Top-Heavy.
(b) Minimum Vesting. Notwithstanding the provisions of
Section 11, the vested interest of each Employee in
his Employer Contributions Account in a Plan Year in
which the Plan is Top Heavy shall be determined,
pursuant to Section 13.03 of the Plan, on the basis
of the following vesting schedule, unless an equal
or a more rapid vesting schedule has been selected
in Section 11:
( ) 100% vesting after _____ (not to exceed 3)
Years of Vesting Service.
( x ) 0% vesting after 1 Year of Vesting Service.
20% (not less than 20) vesting after 2 Years
of Vesting Service.
40% (not less than 40) vesting after 3 Years
of Vesting Service.
60% (not less than 40) vesting after 4 Years
of Vesting Service.
80% (not less than 80) vesting after 5 Years
of Vesting Service.
100% vesting after 6 Years of Vesting Service.
If the vesting schedule under the Plan shifts in or
out of the above schedule for any Plan Year because
of the Plan's Top-Heavy status, such shift is an
amendment to the vesting schedule and the election
rule in Section 17.01(c) of the Plan applies.
(c) Multiple Plans-Minimum Contributions and Allocations.
This subsection shall only apply if you sponsor
another qualified retirement plan.
19<PAGE>
<PAGE>
(i) Code Section 415(e) Buy-Backs. If another
retirement plan is a qualified defined benefit
plan, and if for a Plan Year the plans are
Top-Heavy (but not Super Top Heavy), then the
"Code Section 415(e) buy back" provisions, as
defined in Section 13.04 of the Plan,
( x ) shall be utilized, so that 125%
( ) shall not be utilized, so that 100%
of the dollar limitations set out in Section
5.07 of the Plan shall be used in computing
the Defined Benefit Fraction and the Defined
Contributions Fraction.
(ii) Minimum Accruals.
( ) Even if the Plan is not a Paired Plan,
the Plan shall be considered to be
subject to the Paired Plan minimum
allocation provisions of ARTICLE 14
of the Plan as if it were a Paired Plan.
( ) The following overriding provisions shall
control instead of the Paired Plan
provisions regarding minimum accruals:
________________________________________
________________________________________
________________________________________
________________________________________
(iii) No Duplicate Benefits. If another retirement
plan is a qualified defined contribution plan
which is to be treated as a Paired Plan, then
the required minimum Employer Contributions
and allocations shall be provided only under
( ) this Plan.
( ) the other qualified defined
contribution plan.
(iv) Present Value. For purposes of establishing
Present Value to compute the Top-Heavy Ratio for
the Plan as set forth in Section 13.01(c) of the
Plan, any benefit under a qualified defined
benefit pension plan maintained by the Employer
shall be discounted only for mortality and
interest based on the following factors which,
if a lump sum benefit is available, should be
the factors used to compute a lump sum benefit:
20<PAGE>
<PAGE>
Mortality Table: ( ) the UP-1984
Mortality Table
( X ) as provided in the
qualified defined
benefit pension plan
( ) Other: _____________
____________________
Interest Rate: ( ) the current rate
specified for
the purchase of
immediate annuities
by the Pension
Benefit Guaranty
Corporation
( X ) as provided in the
qualified defined
benefit pension plan
( ) Other: _____________
____________________
(v) Valuation Date. For purposes of computing the
Top-Heavy Ratio, the Valuation Date shall be:
( X ) The Limitation Year selected in Section
1(c).
( ) The twelve (12) consecutive month period
ending on ________________.
SECTION 17. INVESTMENTS
-------------------------
(Note: Choose any one option or permitted combination of
options.)
(a) Investment decisions with respect to the portion of
the assets of the Plan indicated below shall be
controlled as follows (note: all selections must total
100% of assets and shall be measured as of the
execution date of this Adoption Agreement, or such
other date as set by the Employer):
( X ) 100% (not more than 100%) controlled by the
Trustee in its sole discretion.
( ) ___% (not more than 100%) controlled by an
Investment Manager appointed by the Employer
pursuant to the provisions of Section 16.04
of the Plan.
21<PAGE>
<PAGE>
( ) ___% (not more than 100%) controlled by each
Participant, with respect to his Accounts
other than his Employer Contributions Accounts
pursuant to the provisions of Section 5.08
of the Plan.
(b) ( ) Although the Trustee or an Investment Manager
has been designated above to control a portion
of the investments, notwithstanding the
portion of the investment control designated
above, the Administrator may elect to permit
each Participant to have the right, at the
Participant's discretion, to control the
investment of the vested amount of his
Employer Contributions Account and the amount
of his other Accounts.
(c) ( X ) The Trustee may delegate its duty physically
to hold and safeguard the assets of the Plan
to the Sponsor as custodian.
(d) ( X ) Investment by the Plan in Qualifying Employer
Securities shall be permitted, provided the
requirements of Section 406, 407 and 408 of
ERISA are met, to a maximum of 100% (note:
not more than 100%) of ( ) that portion of
the Trust Fund attributable to Employer
Contributions and Forfeitures ( X ) the value
of the entire Trust Fund (note: election of
this second option may require the
registration of such securities with the
Securities and Exchange Commission). With
respect to the voting of such Qualifying
Employer Securities, the following entity
shall vote such shares (note:select only one):
( ) the Trustee.
( ) the Participant to whose Account the
shares have been allocated.
( X ) the Administrator or, if appointed,
the Committee.
SECTION 18. INSURED DEATH BENEFIT
-----------------------------------
( X ) No life insurance shall be provided
under the Plan
( ) An additional death benefit may be
provided through the purchase of life
insurance policies at the election of
a Participant in accordance with
Section 8.02 of the Plan.
22<PAGE>
<PAGE>
SECTION 19. JOINT AND SURVIVOR ANNUITY
----------------------------------------
(a) Benefits under the Plan
( ) may
( X ) may not
be paid in the form of an annuity involving life
contingencies. (Note: Optional forms of benefit
payment may not be eliminated.)
(b) If benefits may be paid in the form of an annuity,
then the Qualified Joint and Survivor Annuity shall
be an annuity with 50% of the annuity benefit
continuing to a Participant's surviving Spouse at the
Participant's death, unless a greater percentage is
elected below:
( ) 75%
( ) 100%
SECTION 20. LIMITATION ON ALLOCATIONS
---------------------------------------
If you maintain or ever maintained another qualified plan
(other than Paired Plan #003 or #005) in which any Participant
in this Plan is (or was) a Participant or could become a
Participant, you must complete this Section. You must also
complete this Section if you maintain a welfare benefit fund, as
defined in Section 419(e) of the Code, or an individual medical
account, as defined in Section 415(1)(2) of the Code, under
which amounts are treated as Annual Additions with respect to
any Participant in this Plan.
(a) ( ) If the Participant is covered under another
qualified defined contribution plan maintained
by the Employer, other than a master or
prototype plan (note: select only one option):
( ) The provisions of subsections (b) and
(c) of Section 5.07 of the Plan will
apply as if the other plan were a
master or prototype plan.
23<PAGE>
<PAGE>
( ) The amount of Annual Additions allocated to
any Participant's Accounts under this Plan
shall be limited to the Maximum Permissible
Amount, and excess amounts will be properly
reduces, as follows:
___________________________________________
___________________________________________
___________________________________________
___________________________________________
( X ) This situation is not applicable.
(b) ( ) If the Participant is or has been a
Participant in a defined benefit plan
maintained by the Employer (note:
select only one option):
( ) In any Limitation Year, the Annual
Additions credited under this Plan to
the Participant may not cause the sum
of the Defined Benefit Fraction and
Defined Contribution Fraction to
exceed 1.0. If the Employer's
contribution that would otherwise be
made on the Participant's behalf
during the Limitation Year would cause
the 1.0 limitation to be exceeded, the
rate of contribution under this Plan
will be reduced so that the sum of the
fractions equals 1.0. If the 1.0
limitation is exceeded because of an
Excess Amount, such Excess Amount will
be reduced in accordance with
subsection 5.07 (a)(iv) of the Plan.
( ) The amount of Annual Additions
allocated to any Participant's
Accounts under this Plan shall be
limited to the Maximum Permissible
Amount, and Excess Amounts will be
properly reduced, as follows:
_____________________________________
_____________________________________
_____________________________________
_____________________________________
( X ) This situation is not applicable.
(c) The Limitation Year is the following twelve (12)
consecutive month period:
( ) The Limitation Year selected in Section 1(c).
( ) The twelve (12) consecutive month period
ending on _______________.
24<PAGE>
<PAGE>
SECTION 21. SERVICE WITH PREDECESSOR EMPLOYER
-----------------------------------------------
Employment with the following Predecessor Employer(s) shall
be considered Service with the Employer for all purposes of the
Plan. (Note: If the Employer is maintaining a tax-qualified
plan of a Predecessor Employer, that Predecessor Employer must
be listed; place an asterisk (*) after the name of any such
Predecessor Employer.):
( ) There are no such predecessor employers.
( ) (1) _____________________________________________
(2) _____________________________________________
(3) _____________________________________________
SECTION 22. CONTROLLED GROUP MEMBERS
--------------------------------------
The following employers are Controlled Group Members:
( ) There are no such employers.
( ) (1) _____________________________________________
(2) _____________________________________________
(3) _____________________________________________
SECTION 23. CONTROLLED GROUP MEMBERS WHO ARE ADOPTING EMPLOYERS
- ----------------------------------------------------------------
The following Controlled Group Members have adopted the
Plan for which a single Trust Fund may be used for the
investment of the Trust Fund:
( ) There are no such Employers.
( ) (1) _____________________________________________
(2) _____________________________________________
25<PAGE>
<PAGE>
SECTION 24. CODA OPTION
-------------------------
( X ) Check here and complete the following provisions if
the Elective Deferrals are permitted under this
Plan.
ITEM 1. EMPLOYER CONTRIBUTIONS UNDER THE CODA OPTION
- ------------------------------------------------------
( X ) Check here if the Employer may make contributions
to the CODA without regard to current or
accumulated earnings and profits for the taxable
year or years ending with or within the Plan Year.
ITEM 2. ELECTIVE DEFERRALS
- ----------------------------
(a) A Participant may elect pursuant to a Salary Reduction
Agreement to have his or her Compensation reduced
by the following percentages or amount per pay period
as designated in writing to the Administrator (check
the applicable option and fill int he appropriate
blank):
( X ) An amount not in excess of 15% of a
Participant's Compensation.
( ) An amount not in excess of $_____
(enter a specified dollar amount)
of a Participant's Compensation.
No Participant shall be permitted to have Elective
Deferrals made under this Plan during any calendar year in
excess of $7,000, multiplied by the Adjustment Factor.
(b) (i) A Participant may elect to commence Elective
Deferrals as of January 1 and July 1 (enter at
least one date or period during a calendar year).
Such election shall become effective as of the
first pay period following the pay period during
which the Participant's election to commence
Elective Deferrals was made, or as soon as
administratively feasible thereafter.
(ii) A Participant's election to have Elective
Deferrals made shall remain in effect until the
Salary Reduction Agreement is modified or
terminated. A Participant may (1) modify the
amount of Elective Deferrals as of January 1 &
July 1 (enter at least one date or period during
a calendar year) or (2) terminate Elective
Deferrals at any time. Such election shall
become effective as of the first pay period
following the pay period during which the
Participant's election to modify or terminate
Elective Deferrals was made, or as soon as
administratively feasible thereafter.
26<PAGE>
<PAGE>
(c) ( X ) Check here if a Participant may base Elective
Deferrals on cash bonuses that, at the
Participant's election, may be contributed to the
CODA or received by the Participant in cash. A
Participant shall be afforded a reasonable period
to elect to defer amounts described in this
subsection (c). Such election shall become
effective as of the first pay period following
the pay period during which the Participant's
election to make such Elective Deferrals was
made, or as soon as administratively feasible
thereafter.
(d) A Participant shall designate the amount and
frequency of his or her Elective Deferrals in the form and
manner specified by the Administrator.
ITEM 3. QUALIFIED NON-ELECTIVE CONTRIBUTIONS
- ----------------------------------------------
(a) The Employer (ELECT ONE)
( X ) will
( ) will not
make Qualified Non-elective Contributions to the Plan.
If the Employer does make such Contributions to the
Plan, then the amount of such Contributions for each
Plan Year shall be (ELECT ONE)
( ) percent (not to exceed 15 percent) of the
Compensation of all Participants eligible to
share in the allocation.
( ) percent of the net profits, but in no event
more than $_____ for any Plan Year.
( X ) an amount as determined by the Employer.
(b) Allocation of Qualified Non-elective Contributions
shall be made to the Accounts of [ELECT ONE]
( ) all Participants.
( X ) only Non-highly Compensated Participants.
27<PAGE>
<PAGE>
(c) Allocation of Qualified Non-elective Contributions
shall be made [ELECT ONE]
( X ) in the ratio which each Participant's
Compensation for the Plan Year bears to the
total Compensation of all Participants for
such Plan Year.
( ) in the ratio which each Participant's
Compensation not in excess of $_____ for the
Plan Year bears to the total Compensation of
all Participants not in excess of $_____ for
such Plan Year.
(d) In accordance with Section 6.13 of the Plan,
allocations of special Qualified Non-elective
Contributions to each Non-highly Compensated
Employee's Account shall be made (ELECT ONE)
( X ) in the ratio which each Non-highly Compensated
Employee's Compensation for the Plan Year
bears to the total Compensation of all
Non-highly Compensated Employees for such
Plan Year.
( ) in the ratio in which each Non-highly
Compensated Employee's Compensation not in
excess of $_____ for the Plan Year bears to
the total Compensation of all Non-highly
Compensated Employees not in excess of $_____
for such Plan Year.
ITEM 4. QUALIFIED MATCHING CONTRIBUTIONS
- ------------------------------------------
(a) The Employer
( ) will
( X ) will not
make Qualified Matching Contributions to the Plan. If
the Employer does make such Contributions to the Plan
for a Plan Year, then such contributions shall be made
on behalf of (ELECT ONE)
( ) all Participants
( ) all Participants who are Non-highly
Compensated Employees
28<PAGE>
<PAGE>
who make (ELECT ONE OR BOTH)
( ) Elective Deferrals
( ) Employee Contributions
to the Plan.
(b) The Employer shall contribute and allocate to each
Participant's Qualified Matching Contributions Account
as follows:
( ) ___ percent of the Participant's Elective
Deferrals.
( ) ___ percent of the Participant's Employee
Contributions.
( ) an amount to be determined annually by the
Board.
(c) The Employer shall not match amounts provided above in
excess of
( ) $_____
( ) ___ percent of the Participant's Compensation.
( ) an amount to be determined annually by the
Board.
ITEM 5. ACTUAL DEFERRAL PERCENTAGE
- ------------------------------------
(a) Qualified Matching Contributions and Qualified
Non-elective Contributions may be taken into account
as Elective Deferrals for purposes of calculating the
Actual Deferral Percentages. In determining Elective
Deferrals for the purpose of the ADP test, the
Employer shall include (ELECT, AS APPROPRIATE)
( ) Qualified Matching Contributions
( X ) Qualified Non-elective Contributions
under this Plan or any other Plan of the Employer, as
provided by regulations under the Code.
29<PAGE>
<PAGE>
(b) The amount of Qualified Matching Contributions made
under Item 4 of this CODA Option and taken into
account as Elective Deferrals for purposes of
calculating the Actual Deferral Percentage, subject to
such other requirements as may be prescribed by the
Secretary of the Treasury, shall be
( ) all such Qualified Matching Contributions
( X ) such Qualified Matching Contributions that are
needed to meet the Actual Deferral Percentage
test stated in Section 6.04 of the Plan.
(c) The amount of Qualified Non-elective Contributions
made under Item 3 of this CODA Option and taken into
account as Elective Deferrals for purposes of
calculating the Actual Deferral Percentages, subject
to such other requirements as may be prescribed by the
Secretary of the Treasury, shall be
( ) all such Qualified Non-elective Contributions.
( X ) such Qualified Non-elective Contributions that
are needed to meet the Actual Deferral
Percentage test stated in Section 6.04 of the
Plan.
ITEM 6. CLAIMS FOR EXCESS ELECTIVE DEFERRALS
- ----------------------------------------------
Participants who claim Excess Elective Deferrals for the
preceding taxable year must submit their claims in writing
to the Administrator by March 1 (SPECIFY A DATE BEFORE
APRIL 15).
ITEM 7. VOLUNTARY NON-DEDUCTIBLE CONTRIBUTIONS
- ------------------------------------------------
( ) Check here and complete the provisions below if
Employees may make Voluntary Non-deductible
Contributions to the Plan.
Voluntary Non-deductible Contributions shall be
made
( ) regularly by payroll deduction, and shall share in
investment income for the Plan Year for which made
( ) as determined by the Participant, and shall not
share in investment income for the Plan Year for
which made
and shall be
30<PAGE>
<PAGE>
( ) combined with other Plan assets for investment
purposes.
( ) invested separately from other Plan assets in an
account consisting of certificates of deposit,
money market certificates, collective investment
trusts, other short-term debt security instruments
or any other investments acceptable to the Trustee.
ITEM 8. MATCHING CONTRIBUTIONS
- --------------------------------
(a) The Employer
( X ) will
( ) will not
make Matching Contributions to the Plan. If the
Employer does make such Contributions to the Plan for
a Plan Year, then such Contributions shall be made on
behalf of (ELECT ONE)
( X ) all Participants
( ) all Participants who are Non-highly
Compensated Employees
who make (ELECT ONE OR BOTH)
( X ) Elective Deferrals
( ) Employee Contributions
to the Plan.
(b) The Employer shall contribute and allocate to each
Participant's Matching Contributions Account an amount
equal to
( ) percent of the Participant's Elective
Deferrals.
( ) percent of the Participant's Employee
Contributions.
( X ) an amount to be determined annually by the
Board.
31<PAGE>
<PAGE>
(c) The Employer shall not match amounts provided above in
excess of
( ) $_____
( X ) 6 percent of the Participant's Compensation.
( ) an amount to be determined annually by the
Board.
ITEM 9. VESTING OF MATCHING CONTRIBUTIONS
- -------------------------------------------
Matching Contributions will be vested in accordance with
the following schedule (ELECT ONE)
( ) Nonforfeitable when made.
( ) The profit-sharing plan's general vesting schedule,
other than that for Elective Deferrals.
( ) 100% vesting after (not to exceed 5) Years of
Vesting Service.
( X ) 0% vesting after 1 Year of Vesting Service.
0% vesting after 2 Years of Vesting Service.
20% (not less than 20) vesting after 3 Years of
Vesting Service.
40% (not less than 40) vesting after 4 Years of
Vesting Service.
60% (not less than 60) vesting after 5 Years of
Vesting Service.
80% (not less than 80) vesting after 6 Years of
Vesting Service.
100% vesting after 7 Years of Vesting Service.
If the Plan is Top Heavy pursuant to ARTICLE 13, the
vesting schedule selected in Section 16(b) shall apply.
32<PAGE>
<PAGE>
ITEM 10. AVERAGE CONTRIBUTION PERCENTAGE
- ------------------------------------------
(a) In computing the Average Contribution Percentage, the
Employer shall take into account, and include as
Contribution Percentage Amounts,
( X ) Elective Deferrals
( X ) Qualified Non-elective Contributions
under this Plan or any other plan of the Employer, as
provided by regulations.
(b) The amount of Qualified Non-elective Contributions
that are made under Item 3 of this CODA Option and
taken into account as Contribution Percentage Amounts
for purposes of calculating the Average Contribution
Percentage, subject to such other requirements as may
be prescribed by the Secretary of the Treasury, shall
be
( ) all such Qualified Non-elective Contributions.
( X ) such Qualified Non-elective Contributions that
are needed to meet the Average Contribution
Percentage test stated in Section 6.11 of the
Plan.
(c) The amount of Elective Deferrals made under Item 2 of
this CODA Option and taken into account as
Contribution Percentage Amounts for purposes of
calculating the Average Contribution Percentage,
subject to such other requirements as may be
prescribed by the Secretary of the Treasury, shall be
( ) all such Elective Deferrals.
( X ) such Elective Deferrals that are needed to
meet the Average Contribution Percentage test
stated in Section 6.11 of the Plan.
(d) Forfeitures of Excess Aggregate Contribution shall be
( ) applied to reduce Employer Contributions for
the Plan Year in which the Excess arose, but
allocated as in the following option, to the
extent the Excess exceeds Employer
Contributions or the Employer has already
contributed for such Plan Year.
33<PAGE>
<PAGE>
( X ) allocated, after all other Forfeitures under
the Plan, to the Matching Contribution Account
of each Non-highly Compensated Employee who
made Elective Deferrals or Employee
Contributions in the ratio which each such
Participant's Compensation for the Plan Year
bears to the total Compensation of all such
Participants for such Plan Year.
ITEM 11. HARDSHIP DISTRIBUTIONS
- ---------------------------------
( X ) Check here if the Employer permits distributions of
Elective Deferrals (and earnings thereon accrued as
of December 31. 1988) in the event of hardship.
In the event a Participant receives a hardship
distribution:
(a) the Participant's Elective Deferrals (and
Voluntary Non-Deductible Contributions) will be
suspended for twelve (12) months after the
receipt of the hardship distribution, and
(b) the Participant may not make Elective Deferrals
for the Participant's taxable year immediately
following the taxable year of the hardship
distribution in excess of the applicable limit
under Section 402 (g) of the Code for such
taxable year less that amount of such
Participant's Elective Deferrals for the
taxable year of the hardship distribution.
ITEM 12. LIMITATIONS ON CONTRIBUTIONS
- ---------------------------------------
Amounts that are contributed or allocated to the Accounts
of each Participant under the Plan must not, when
aggregated with amounts that are contributed or allocated
to the accounts of each Participant under any other plan or
plans in accordance with the provisions of the underlying
Plan document, exceed the applicable limitations on
contributions and allocations as stated in the underlying
Plan document and otherwise required under Section 415 of
the Code and the regulations thereunder.
34<PAGE>
<PAGE>
ITEM 13. COMPENSATION
- ----------------------
( ) Check here if, in addition to Compensation as
defined in Section 2.13 of the Plan, Compensation
shall also include Compensation which is not
currently includible in the Participant's gross
income by reason of the application of Section 125,
402(a)(8), 402(h)(1)(B) or 403(b) of the Code.
An Employer who has ever maintained or who later adopts any plan
(including a Welfare Benefit Fund, as defined in Section 419(e)
of the Code, which provides post-retirement medical benefits
allocated to separate accounts for Key Employees as defined in
Section 419A(d)(3) of the Code, or an individual medical
account, as defined in Section 415(1)(2) of the Code) in
addition to this opinion letter issued by the National Office of
the Internal Revenue Service as evidence that this Plan is
qualified under Section 401 of the Internal Revenue Code. If
the Employer who adopts or maintains multiple plans wishes to
obtain reliance that his or her Plan(s) are qualified,
application for a determination letter should be made to the
appropriate Key District Director of the Internal Revenue.
This Adoption Agreement may be used only in conjunction with
Basic Plan document #01.
35<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Employer and the undersigned
Trustee(s) have caused this Adoption Agreement to be executed
this 19th day of August, 1997.
THE EMPLOYER:
Newport Federal Savings and Loan
Association
ATTEST: By: /s/ Richard Harwood
-------------------
/s/ Nancy Bryant Title: President
- ---------------- ---------
ADOPTING EMPLOYER:
ATTEST: By: _____________________________
_________________________ Title: __________________________
ADOPTING EMPLOYER:
ATTEST: By: _____________________________
_________________________ Title: __________________________
THE TRUSTEE:
HOME FEDERAL BANK OF TENNESSEE
------------------------------
ATTEST: By: _____________________________
Title: Assistant Vice President
_________________________ ------------------------
THE CUSTODIAN (only if Sponsor
named Custodian:
_________________________________
ATTEST: By: _____________________________
_________________________ Title: __________________________
36<PAGE>
<PAGE>
LOAN
EXHIBIT 1
---------
LOAN PROGRAM
------------
( x ) Check here and either adopt the Model Loan Program
attached hereto or complete the provisions of this
Exhibit below if loans are permitted under this Plan
as elected by the Employer in Section 14 of the Adoption
Agreement.
( ) The Model Loan Program attached shall apply.
( ) The provisions filled in below shall apply
(attach separate sheet if necessary).
This Exhibit 1 shall be subject to the provisions of ARTICLE 12
of the Plan. If there is any conflict between the terms of this
Exhibit 1 and ARTICLE 12 of the Plan, the Plan shall control.
________________________________________________________________
Person(s) or position(s) authorized to administer the loan
program: (specify) _____________________________________________
Loan procedure: ________________________________________________
________________________________________________
________________________________________________
________________________________________________
Basis on which loan will be approved or denied: ________________
________________________________________________
________________________________________________
Limitations (if any) on types and amounts of loans offered: ____
________________________________________________
________________________________________________
________________________________________________
Procedure for determining reasonable rate of interest: _________
________________________________________________
Types of collateral which may secure a loan: ___________________
________________________________________________
Events constituting default and steps to be taken to preserve
Plan assets in the event of such default: ______________________
________________________________________________
________________________________________________
________________________________________________
1<PAGE>
<PAGE>
LOAN
MODEL LOAN PROGRAM
- ---------------------------------------------------------------
LOAN PROCEDURES
---------------
The administrator(s) of the loan program shall be the head
of human resources and/or personnel (and those individuals to
whom he or she may delegate this authority). The administrator
shall keep loan applications and make them available to all plan
participants during regular business hours. When a plan
participant applies for a loan, the administrator of the loan
program will contact two, or if possible three, local banks or
lending institutions. The administrator shall obtain from those
banks or lending institutions current prime rates based upon the
same terms of the loan to be made from the plan. Consequently
all such rates shall be obtained on a secured loan basis for a
fixed amount of time at a fixed (i.e., not variable) rate. The
administrator of the loan program shall then notify the plan
participant of the rate to apply to his or her loan and
determine if the participant wishes to continue his or her
application for the loan. If the participant does not, the loan
application will be so noted and retained in the files of the
administrator. If the participant still wants to be considered
for a loan, the administrator shall notify the participant of
his or her approval or denial for a loan. Thereafter as soon as
practicable, the loan shall be made to the plan participant if
approved. No loan shall be made for a period beyond five years
unless the loan is to purchase a principal residence. All loan
repayments shall be made by payroll deduction at least
quarterly. Each loan shall be evidenced by a note containing an
acceleration upon default clause. The same loan note, varying
only as to rate (as concurrently determined at the loan
application) and term of the loan, shall be used for all
similarly situated plan participants.
BASIS ON WHICH LOAN WILL BE APPROVED OR DENIED
----------------------------------------------
Loans generally will be approved except for the following:
1. Employees for whom there is a reasonable expectation
that their work performance or past history with the
company will result in their not being employed
throughout the duration of their loan;
2. Employees who are seeking loans extending beyond their
period of expected service because of retirement;
3. Former employees not actively at work with the
employer so as to justify the payroll deduction
repayment of the loan amount;
2<PAGE>
<PAGE>
LOAN
4. Seasonal or part-time employees who may reasonably be
expected not to work a sufficient number of hours to
seasonally repay a requested loan based on the
required loan rate schedule;
5. Loans to any employee in excess of amounts permitted
under the loan program.
LIMITATIONS ON TYPES AND AMOUNTS OF LOANS OFFERED
-------------------------------------------------
Loans generally will be offered for the following reasons:
1. Purchase or refurbishment of a home;
2. Payment of secondary or post-secondary education;
3. Purchase of a new or used car to be used for
transportation to and from work
or to transport children to school;
4. Medical expenses not paid for or reimbursed by the
Medical Plan or Plans maintained by the employer;
5. For purposes of taking a regularly scheduled vacation;
6. To meet emergency liquidity requirements of the plan
participant.
The loan shall be limited to the lesser of (a) an amount
equal to one-half of the participant's vested interest in his
account balances as of the last valuation date or (b) $50,000.
SCHEDULE FOR DETERMINING REASONABLE RATE OF INTEREST
----------------------------------------------------
The administrator of the loan program shall check with not
less than two and preferably three banks or lending institutions
to determine what prevailing rates are being commercially
offered in the geographic area concurrently with the loan
application or the same term (i.e., duration) of the loan to be
made from the plan. These rates shall be averaged and increased
by one (1) percentage point (i.e., 100 basis points) to
determine the rate to be paid by the plan participant. Further,
this rate shall be charged to the participant during the term of
his or her loan. Interest rate shall be fixed during the term
and will not fluctuate.
COLLATERAL WHICH MAY SECURE A LOAN
----------------------------------
The only security acceptable to secure a loan is one-half
of the vested account balance of an employee.
3<PAGE>
<PAGE>
LOAN
EVENTS CONSTITUTING DEFAULT AND STEPS TO BE TAKEN
TO DEFER PLAN ASSETS IN EVENT OF SUCH A DEFAULT
-------------------------------------------------
In the event of default the amount of loan will accelerate
and become immediately due and payable. The administrator of
the loan program will send a written notice to the plan
participant telling him or her that he or she has defaulted on
their loan and that the full amount of the loan is now due and
payable, with interest continuing to accrue at the original
specified rate on all outstanding balances until the full amount
due is paid. The offset to the account balance will occur at
the time there has been a distributable event. Account balances
shall also be credited with regular plan earnings or losses
prior to distribution.
4<PAGE>
<PAGE>
FIRST AMENDMENT TO THE
HOME FEDERAL BANK OF TENNESSEE, FSB
PROTOTYPE DEFINED CONTRIBUTION PLAN AND TRUST
BASIC DOCUMENT #01
- ----------------------------------------------------------------
WHEREAS, Home Federal Bank of Tennessee, FSB (sponsor)
established the Home Federal Bank of Tennessee, FSB Prototype
Defined Contribution Plan and Trust #01 (Prototype Plan), and
the Adoption Agreements for such Prototype Plan having received
favorable opinion letters from the Internal Revenue Service,
dated as of May 10, 1990; and
WHEREAS, the Sponsor has been expressly delegated the
authority by the adopting Employers of the Prototype Plan to
amend the Prototype Plan as the Sponsor deems necessary or
desirable; and
WHEREAS, the Internal Revenue Service, under Revenue
Procedure 93-12, requires that the Prototype Plan be amended to
comply with the Unemployment Compensation Amendments of 1992;
NOW, THEREFORE, the Prototype Plan is hereby amended as
follows:
I.
Add to the end of the Prototype Plan new ARTICLE 19 to
read as follows:
ARTICLE 19
DIRECT ROLLOVERS
19-01 Election of Direct Rollover. This ARTICLE
applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary
that would otherwise limit a Distributee's election under
this ARTICLE, a Distributee may elect, at the time and in
the manner prescribed by the Administrator, to have any
portion of an Eligible Rollover Distribution paid directly
to an Eligible Retirement Plan specified by the Distributee
in a Direct Rollover.
19.02 Definitions.
(a) Eligible Rollover Distribution: An Eligible
Rollover Distribution is any distribution of all or
any portion of the balance to the credit of the
Distributee, except that an Eligible Rollover
Distribution does not include:
<PAGE>
<PAGE>
(i) any distribution that is one of a
series of substantially equal periodic payments
(not less frequently than annually) made for the
life (or life expectancy) of the Distributee or
the joint lives (or joint life expectancy) of the
Distributee or the joint lives (or joint life
expectancies) of the Distributee and the
Distributee's Beneficiary, or for a specified
period of ten years or more; or
(ii) any distribution to the extent such
distribution is required under Section 401(a)(9)
of the Code; and
(iii) the portion of any distribution that
that is not includible in gross income
(determined without regard to the exclusion for
net unrealized appreciation with respect to
Employer securities).
(b) Eligible Retirement Plan: An Eligible
Retirement Plan is an individual retirement account
described in Section 408(a) of the Code, an individual
retirement annuity described in Section 408(b) of the
Code, an annuity plan described in Section 403(a) of
the Code or a qualified trust described in Section
401(a) of the Code, that accepts the Distributee's
Eligible Rollover Distribution. However, in the case
of an Eligible Rollover Distribution to the surviving
spouse, an Eligible Retirement Plan is an individual
retirement account or individual retirement annuity.
(c) Distributee: A Distributee includes an
Employee or former Employee. In addition, the
Employee's or former Employee's surviving spouse and
the Employee's or former Employee's spouse or former
spouse who is the alternate payee under a qualified
domestic relations order, as defined in Section 414(p)
of the Code, are Distributees with regard to the
interest of the spouse or former spouse.
(d) Direct Rollover: A Direct Rollover is a
payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.
II.
The effective date of this First Amendment shall be
January 1, 1993.
III.
In all other respects, the Prototype Plan is ratified
and confirmed.
* * * * *
2<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Sponsor hereby adopts this
First Amendment on this 18th day of February, 1993.
THE SPONSOR:
HOME FEDERAL BANK OF TENNESSEE, FSB
ATTEST:
/s/ Evelyn R. Crawley By: /s/ David E. Sharp
- --------------------- ----------------------
Evelyn R. Crawley, Secretary David E. Sharp
Title: CHAIRMAN AND CEO
------------------------
3<PAGE>
<PAGE>
SECOND AMENDMENT TO THE
HOME FEDERAL BANK OF TENNESSEE, FSB
PROTOTYPE DEFINED CONTRIBUTION PLAN AND TRUST
BASIC DOCUMENT #01
- ----------------------------------------------------------------
WHEREAS, Home Federal Bank of Tennessee, FSB (Sponsor)
established the Home Federal Bank of Tennessee, FSB Prototype
Defined Contribution Plan and Trust #01 (Prototype Plan), and
the Adoption Agreements for such Prototype Plan having received
favorable opinion letters from the Internal Revenue Service,
dated as of May 10, 1990; and
WHEREAS, the Sponsor has been expressly delegated the
authority by the adopting Employers of the Prototype Plan to
amend the Prototype Plan as the Sponsor deems necessary
or desirable; and
WHEREAS, the Internal Revenue Service, under Revenue
Procedure 94-13, requires that the Prototype Plan be amended to
comply with the Omnibus Budget Reconciliation Act of 1993 (OBRA
'93);
NOW, THEREFORE, the Prototype Plan is hereby amended
as follows:
I.
Add to the end of Section 2.13, entitled Compensation,
to read as follows:
In addition to other applicable limitations set forth
in the plan, and notwithstanding any other provision of the
plan to the contrary, for plan years beginning on or after
January 1, 1994, the annual compensation of each employee
taken into account under the plan shall not exceed the OBRA
'93 annual compensation limit. The OBRA '93 annual
compensation limit is $150,000, as adjusted by the
Commissioner for increases in the cost of living in
accordance with section 401(a)(17)(B) of the Internal
Revenue Code. The cost-of-living adjustment in effect for
a calendar year applies to any period, not exceeding 12
months, over which compensation is determined
(determination period) beginning in such calendar year.
If a determination period consists of fewer than 12 months,
the OBRA '93 annual compensation limit will be multiplied
by a fraction, the numerator of which is the number of
months in the determination period, and the denominator of
which is 12.
For plan years beginning on or after January 1, 1994,
any reference in this plan to the limitation under section
401(a)(17) of the Code shall mean the OBRA '93 annual
compensation limit set forth in this provision.
<PAGE>
<PAGE>
If compensation for any prior determination period is
taken into account in determining an employee's benefits
accruing in the current plan year, the compensation for
that prior determination period is subject to the OBRA '93
annual compensation limit in effect for that prior
determination period. For this purpose, for determination
periods beginning before the first day of the first plan
year beginning on or after January 1, 1994, the OBRA '93
annual compensation limit is $150,000.
II.
The effective date of this Second Amendment shall be
January 1, 1994.
III.
In all other respects, the Prototype Plan is ratified
and confirmed.
* * * * *
2<PAGE>
IN WITNESS WHEREOF, the Sponsor hereby adopts this
Second Amendment on this 3rd day of May, 1994.
THE SPONSOR:
HOME FEDERAL BANK OF TENNESSEE, FSB
ATTEST:
By: /s/ Ray Thomas
- --------------------- -------------------------------
Title: Executive Vice President
and Treasurer
3<PAGE>
<PAGE>
THIRD AMENDMENT TO THE
HOME FEDERAL BANK OF TENNESSEE, FSB
PROTOTYPE DEFINED CONTRIBUTION PLAN AND TRUST
BASIC DOCUMENT #01
- ----------------------------------------------------------------
WHEREAS, Home Federal Bank of Tennessee, FSB (Sponsor)
established the Home Federal Bank of Tennessee, FSB Prototype
Defined Contribution Plan and Trust #01 (Prototype Plan), and
the Adoption Agreements for such Prototype Plan having received
favorable opinion letters from the Internal Revenue Service,
dated as of May 10, 1990; and
WHEREAS, the Sponsor has been expressly delegated the
authority by the adopting Employers of the Prototype Plan to
amend the Prototype Plan as the Sponsor deems necessary or
desirable; and
WHEREAS, the Internal Revenue Service, under Revenue
Procedure 93-47, requires that the Prototype Plan be amended to
reflect the modifications made by Notice 93-26, 1993-18 I.R.B.
11, to the 30-day notice requirement under Section
1.411(a)-ll(c) of the Income Tax Regulations;
NOW, THEREFORE, the Prototype Plan is hereby amended
as follows:
I.
Add a new paragraph to the end of Section 10.03(a),
entitled Restrictions on Immediate Distribution, to read as
follows:
If a distribution is one to which Sections 401(a)(11)
and 417 of the Code do not apply, such distribution may
commence less than 30 days after the notice required under
Section 1.411(a)-ll(c) of the Income Tax Regulations is
given, provided that:
(1) the plan administrator clearly informs the
participant that the participant has a right to a
period of at least 30 days after receiving the notice
to consider the decision of whether or not to elect a
distribution (and, if applicable, a particular
distribution option), and
(2) the participant, after receiving the notice,
affirmatively elects a distribution.
<PAGE>
<PAGE>
II.
The effective date of this Third Amendment shall be
January 1, 1994.
III.
In all other respects, the Prototype Plan is ratified
and confirmed.
* * * * *
2
<PAGE>
<PAGE>
IN WITNESS WHEREOF, the Sponsor hereby adopts this
Third Amendment on this 13th day of November, 1995.
THE SPONSOR:
HOME FEDERAL BANK OF TENNESSEE, FSB
ATTEST:
By: /s/ Ray Thomas
- --------------------- -------------------------------
Title: Executive Vice President
and Treasurer
3
<PAGE>
<PAGE>
RESOLUTION OF BOARD OF DIRECTORS
OF
NEWPORT FEDERAL SAVINGS AND LOAN ASSOCIATION
I hereby certify that the following is a true copy of
resolutions duly adopted by the Board of Directors of the
Employer at a special meeting held on March 7, 1997 at which a
quorum was present and acting throughout.
WHEREAS, The Employer has previously adopted the Third National
Corporation Prototype Defined Contribution Plan and Trust Plan
hereinafter called the Former Plan and Trust effective as of
January 1, 1986; and
WHEREAS, The Employer desires to amend and restate the Former
Plan and Trust in total;
NOW THEREFORE, Be it resolved that the Employer hereby removes
Third National Corporation DBA SunTrust as Trustee under the
Trust for the Plan and does hereby appoint Home Federal Bank of
Tennessee, as successor Trustee, effective as of March 7, 1997;
and
BE IT RESOLVED FURTHER, that the Employer hereby amends and
restates the former plan under the terms of the Home Federal
Bank of Tennessee Prototype Defined Contribution Plan and Trust,
effective as of March 7, 1997;
RESOLVED, That the proper officers or representatives of the
Employer are hereby authorized and directed to execute an
Adoption Agreement setting forth the terms and conditions of the
Employer's amended and restated Plan.
RESOLVED, That the Treasurer is hereby authorized and directed
to pay to the Trustee(s) under the Employer's Plan, such sum or
sums in accordance with the terms of said Plan from year to year
until otherwise directed by this Board.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed the
seal of said Employer on this 7th day of March, 1997.
CORPORATE SEAL Newport Federal Savings and Loan Assn.
William B. Henry, Secretary
---------------------------
By: /s/ William B. Henry, Secretary
SUMMARY PLAN DESCRIPTION
FOR THE
NEWPORT FEDERAL SAVINGS
AND LOAN ASSOCIATION 401(k) RETIREMENT PLAN
Effective: January 1, 1986
As Amended: September 1, 1997
<PAGE>
<PAGE>
TABLE OF CONTENTS
Page
(1) GENERAL . . . . . . . . . . . . . . . . . . . . 1
(2) IDENTIFICATION OF PLAN. . . . . . . . . . . . . 1
(3) TYPE OF PLAN. . . . . . . . . . . . . . . . . . 1
(4) PLAN ADMINISTRATOR. . . . . . . . . . . . . . . 1
(5) TRUSTEE/TRUST FUND. . . . . . . . . . . . . . . 2
(6) HOURS OF SERVICE. . . . . . . . . . . . . . . . 2
(7) ELIGIBILITY TO PARTICIPATE. . . . . . . . . . . 2
(8) EMPLOYER'S CONTRIBUTIONS. . . . . . . . . . . . 3
401(k) Arrangement. . . . . . . . . . . . . . . 3
Matching contributions. . . . . . . . . . . . . 4
Qualified nonelective contributions . . . . . . 4
Employer's nonelective contributions. . . . . . 4
Allocation of forfeitures . . . . . . . . . . . 5
Compensation. . . . . . . . . . . . . . . . . . 5
Conditions for allocation . . . . . . . . . . . 5
(9) EMPLOYEE CONTRIBUTIONS. . . . . . . . . . . . . 5
(10) VESTING IN EMPLOYER CONTRIBUTIONS . . . . . . . 6
Vesting for Deferral Contributions Account. . . 6
Special vesting rule for death or disability. . 6
Year of service . . . . . . . . . . . . . . . . 6
Forfeiture Break in Service Rule. . . . . . . . 7
Example (7)
Cash Out Rule . . . . . . . . . . . . . . . . . 7
(11) PAYMENT OF BENEFITS AFTER TERMINATION OF
EMPLOYMENT. . . . . . . . . . . . . . . . . . . 8
Forms of Benefit Payment. . . . . . . . . . . . 9
(12) PAYMENT OF BENEFITS PRIOR TO TERMINATION OF
EMPLOYMENT - HARDSHIP WITHDRAWALS. . . . . . . 10
2<PAGE>
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Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
(13) DISABILITY BENEFITS . . . . . . . . . . . . . .10
(14) PAYMENT OF BENEFITS UPON DEATH. . . . . . . . .11
(15) DISQUALIFICATION OF PARTICIPANT STATUS -
LOSS OR DENIAL OF BENEFITS. . . . . . . . . . .11
(16) CLAIMS PROCEDURE. . . . . . . . . . . . . . . .12
(17) RETIRED PARTICIPANT, SEPARATED PARTICIPANT
WITH VESTED BENEFIT, BENEFICIARY RECEIVING
BENEFITS. . . . . . . . . . . . . . . . . . . 12
(18) PARTICIPANT'S RIGHTS UNDER ERISA. . . . . . . .13
(19) FEDERAL INCOME TAXATION OF BENEFITS PAID. . . .14
(20) LOANS . . . . . . . . . . . . . . . . . . . . .14
(21) INVESTMENT IN EMPLOYER SECURITIES . . . . . . .16
3<PAGE>
<PAGE>
SUMMARY PLAN DESCRIPTION
(1) GENERAL. The legal name, address and Federal employer
identification number of the Employer are -
Newport Federal Savings and Loan Association
P.O. Box 249
Newport, TN 37821
EIN: 62-0309135
The Employer has established a retirement plan ("Plan") to
supplement your income upon retirement. In addition to
retirement benefits, the Plan may provide benefits in the event
of your death or disability or in the event of your termination
of employment prior to normal retirement. If after reading the
summary you have any question, please ask the Plan
Administrator. We emphasize this summary plan description is a
highlight of the more important provisions of the Plan. If
there is conflict between a statement in this summary plan
description and in the Plan, the terms of the Plan control.
(2) IDENTIFICATION OF PLAN. The Plan is known as the Newport
Federal Savings and Loan Association 401(k) Retirement Plan.
The Employer has assigned 002 as the Plan identification number.
The plan year is the period on which the Plan maintains its
records: the plan year for this Plan is the 12-month period
ending December 31.
(3) TYPE OF PLAN. The Plan is commonly known as a 401(k)
Profit Sharing Plan. Section (8), "Employer's Contributions,"
explains how you share in the Employer's annual contributions to
the trust fund and the extent to which the Employer has an
obligation to make annual contributions to the trust fund.
Under this Plan, there is no fixed dollar amount of retirement
benefits. Your actual retirement benefit will depend on the
amount of your account balance at the time of retirement. Your
account balance will reflect the annual allocations, the period
of time you participate in the Plan and the success of the Plan
in investing and re-investing the assets of the trust fund. A
governmental agency known as the Pension Benefit Guaranty
Corporation (PBGC) insures the benefits payable under plans
which provide for fixed and determinable retirement benefits.
This Plan does not provide a fixed and determinable retirement
benefit. Therefore, the PBGC does not include this Plan within
its insurance program.
(4) PLAN ADMINISTRATOR. The Employer is the Plan
Administrator. The Employer's telephone number is (423) 623-
6088. The Employer has designated Richard Harwood, President,
to assist the Employer with the duties of Plan Administrator.
You may contact him at the Employer's address. The Plan
Administrator is responsible for providing you and other
participants information regarding your rights and benefits
under the Plan. The Plan Administrator also has the primary
authority for filing the various reports, forms and returns with
the Department of Labor and the Internal Revenue Service.
<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
The name of the person designated as agent for service of legal
process and the address where a processor may serve legal
process upon the Plan are Richard Harwood, President, Newport
Federal Savings and Loan Association, P.O. Box 249, Newport, TN
37821. A legal processor also may serve the Trustee of the Plan
or the Plan Administrator.
The Plan Administrator has the responsibility for making all
discretionary determinations under the Plan and for giving
distribution directions to the Trustee.
(5) Trustee/Trust Fund. The Employer has appointed Home
Federal Bank of Tennessee, 515 Market Street, Knoxville,
Tennessee 37902, to hold the office of Trustee. The Trustee
will hold all amounts the Employer contributes to it in a trust
fund and directs the investment of the Plan Fund except those
funds directed by Participants to be invested in Employer
Securities, in accordance with Section (21) of the Summary.
Upon the direction of the Plan Administrator, the Trustee will
make all distribution and benefit payments from the trust fund
to participants and beneficiaries. The Trustee will maintain
trust fund records on a plan year basis.
(6) Hours of Service. The Plan and this summary plan
description include references to hours of service. To become
eligible to participate in the Plan, to advance on the vesting
schedule or to share in the allocation of Employer contributions
for a plan year, the Plan requires you to complete a minimum
number of hours of service during a specified period. The
sections covering eligibility to participate, vesting and
Employer contributions explain this aspect of the Plan in the
context of those topics. However, hour of service has the same
meaning for all purposes of the Plan.
The Department of Labor, in its regulations, has prescribed
various methods under which the Employer may credit hours of
service. The Employer has selected the "actual" method for
crediting hours of service. Under the actual method, you will
receive credit for each hour for which the Employer pays you,
directly or indirectly, or for which you are entitled to
payment, for the performance of your employment duties. You
also will receive credit for certain hours during which you do
not work if the Employer pays you for those hours, such as paid
vacation.
If an employee's absence from employment is due to maternity or
paternity leave, the employee will receive credit for unpaid
hours of service related to his leave, not to exceed 501 hours.
The Plan Administrator will credit these hours of service to the
first period during which the employee otherwise would incur a
l-year break in service as a result of the unpaid absence.
(7) ELIGIBILITY TO PARTICIPATE. To become a participant, you
must complete six months of service and attain age 21. You do
not have to complete any form for entry into the Plan. You will
become
2<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
a participant on January 1 or July 1 immediately following the
later of the date you complete the age and service
requirement.
For example, if you begin work on February 15 and work from that
February 15 through the following August 15, you would enter the
Plan on the January 1 immediately following the completion of 6
months of service.
The example in the prior paragraph assumes you are at least age
21 when you complete the service requirement. If you have not
attained age 21 when you complete the service requirement, then
you will become a participant in the Plan on the first January 1
or July 1 immediately following your attainment of age 21.
(8) EMPLOYER'S CONTRIBUTIONS.
401(k) ARRANGEMENT. The Plan includes a "401(k) arrangement,"
under which you may elect to have the Employer contribute a
portion of your compensation to the Plan. The contributions the
Employer makes under your election are "elective deferrals."
The Plan Administrator will allocate your elective deferrals to
a separate account designated by the Plan as your Deferral
Contributions Account.
As a participant in the Plan, you may enter into a salary
reduction agreement with the Employer as of January 1 or July 1
of any Plan Year. The Plan Administrator will give you a salary
reduction agreement form which will explain your salary
reduction options. The Employer will withhold from your pay the
amount you have agreed to have the Employer contribute to the
Plan as elective deferrals, not to exceed 15% of your
compensation. Your salary reduction agreement shall stay in
effect until modified by you as of any January 1 or July, or
terminated at any time.
For any calendar year, your elective deferrals also may not
exceed a specific dollar amount determined by the Internal
Revenue Service. If your elective deferrals for a particular
calendar year exceed the dollar limitation in effect for that
calendar year, the Plan will refund the excess amount, plus any
earnings (or losses) allocated to that excess amount. If you
participate in another "401(k) arrangement" or in similar
arrangements under which you elect to have an employer
contribute on your behalf, your total elective deferrals may not
exceed the dollar limitation in effect for that calendar year.
The Form W-2 you receive from each employer for the calendar
year will report the amount of your elective deferrals for that
calendar year under that employer's plan. If your total
elective deferrals exceed the dollar limitation in effect for
that calendar year, you should decide which plan you wish to
designate as the plan with the excess amount. If you designate
this Plan as holding the excess amount for a calendar year, you
must notify the Plan Administrator of that designation by March
1 of the following calendar year. The Trustee then will
distribute the excess amount to you, plus earnings (or loss)
allocated to that excess amount.
3<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
MATCHING CONTRIBUTIONS. For each plan year, the Employer will
contribute to the Plan an amount of matching contributions
determined by the Employer at its discretion. The Employer may
choose not to make matching contributions for a particular plan
year. The Plan Administrator will allocate the matching
contributions on the basis of the participants' "eligible
contributions." A participant's "eligible contributions" equal
the participant's elective deferrals for the plan year (other
than any elective deferrals which exceed the dollar limitation
determined by the Internal Revenue Service), not in excess of 6%
of compensation. A participant's share of the matching
contributions is equal to his share of the total eligible
contributions made by all participants. For example, if your
eligible contributions equal 1% of the total eligible
contributions made by all participants, your account would
receive an allocation of 1% of the total amount of matching
contributions made by the Employer for the plan year. The Plan
Administrator allocates your share of these matching
contributions to your Regular Matching Contributions Account.
QUALIFIED NONELECTIVE CONTRIBUTIONS. The Plan permits the
Employer to contribute a discretionary amount for a plan year
which the Employer will designate as qualified nonelective
contributions. The Employer may choose not to make qualified
nonelective contributions for a particular plan year. If the
Employer makes qualified nonelective contributions for a plan
year, the Plan Administrator will allocate those contributions
to the separate accounts of those nonhighly compensated
participants who are eligible for an allocation for the plan
year. The Plan Administrator will base a nonhighly compensated
participant's allocation of qualified nonelective contributions
upon the participant's share of the total compensation paid
during that plan year to all nonhighly compensated participants
eligible for the allocation. For example, if your compensation
for a particular plan year equals 1% of total compensation for
all nonhighly compensated participants eligible for the
allocation, the Plan Administrator would allocate 1% of the
total qualified nonelective contributions to your Qualified
Nonelective Contributions Account.
EMPLOYER'S NONELECTIVE CONTRIBUTIONS. Each plan year, the
Employer will make nonelective contributions to the Plan in the
amount determined by the Employer at its discretion. The
Employer may choose not to make nonelective contributions to the
Plan for a particular plan year.
The Plan as adopted by the Employer is a nonintegrated profit
sharing plan. For each plan year the Employer makes nonelective
contributions to the Plan, the Plan Administrator will allocate
this contribution to the separate accounts maintained for
participants pro rata in accordance with compensation.
Thus, the Plan Administrator will allocate the Employer's non-
elective contribution in the ratio that the sum of each
participant's compensation bears to the sum of all compensation.
ALLOCATION OF FORFEITURES. The Plan allocates participant
forfeitures as if the forfeitures were additional Employer
nonelective contributions for the plan year in which the
forfeiture occurs.
4<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
COMPENSATION. The Plan defines compensation as the employee's
total amount of earnings reportable as W-2 earnings for Federal
income tax withholding purposes, not including contributions not
taxed under Code Subsection Subsection 125, 402(a)(8), 402(h) or
403(b). With limited exceptions, the Plan includes an
employee's compensation only for the part of the plan year in
which he actually is a participant.
CONDITIONS FOR ALLOCATION. Generally, your account is entitled
to an allocation of Employer contributions for each plan year in
which you are a participant on the last day of the Plan Year, or
if you complete more than 500 Hours of Service in the Plan Year.
As an exception, you are entitled to an allocation for the Plan
Year in which you retire, die or become disabled.
The contribution allocations described in this Section (8) may
vary for certain employees if the Plan is top heavy. Generally,
the plan is top heavy if more than 60% of the Plan's assets are
allocated to the accounts of key employees (certain owners and
officers). If the Plan is top heavy, any participant who is not
a key employee and who employed on the last day of the plan
year, may not receive a contribution allocation which is less
than a certain minimum. Usually that minimum is 3%, but if the
contribution allocation for the plan year is less than 3% for
all the key employees, the top heavy minimum is the smaller
allocation rate. If you are a participant in the Plan, your
allocation described in this Section (8) in most cases will be
equal to or greater than the top heavy minimum contribution
allocation. The Plan also may vary the definition of the top
heavy minimum contribution allocation to take into account
another plan maintained by the Employer.
The law limits the amount of "additions" (other than trust
earnings) which the Plan may allocate to your account under the
Plan. Your additions may never exceed 25% of your compensation
for a particular plan year, but may be less if 25% of your
compensation exceeds a dollar amount announced by the Internal
Revenue Service each year. The Plan may need to reduce this
limitation if you participate (or have participated) in any
other plans maintained by the Employer. The discussion of Plan
allocations in this Section (8) is subject to this limitation.
(9) EMPLOYEE CONTRIBUTIONS. The Plan does not permit nor
require you to make employee contributions to the trust fund.
"Employee contributions" are contributions made by an employee
for which the employee does not receive an income tax deduction.
The only source of contributions under the Plan is the annual
Employer contribution, including the "elective deferrals" made
at your election under the 401(k) arrangement described in
Section (8). "Elective deferrals" are not "employee
contributions" for purposes of the Plan.
(10) VESTING IN EMPLOYER CONTRIBUTIONS. Your interest in the
contributions the employer makes to the Plan for your benefit
become 100% vested when you attain normal retirement age (as
defined in Section (11)). Prior to normal retirement age, your
interest in the contributions the employer makes on your behalf
become vested in accordance with the following schedule:
5<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
Years of Service Nonforfeitable Percentage
Less than 3. . . . . . . . . . . . . . . . . . .0%
3 . . . . . . . . . . . . . . . . . . . . 20%
4 . . . . . . . . . . . . . . . . . . . . 40%
5 . . . . . . . . . . . . . . . . . . . . 60%
6 . . . . . . . . . . . . . . . . . . . . 80%
7 or more. . . . . . . . . . . . . . . . . . .100%
VESTING FOR DEFERRAL CONTRIBUTIONS ACCOUNT. The 100% vesting
schedule does not apply to your Deferral Contributions Account
described in Section (8). Instead, you are 100% vested at all
times in your Deferral Contributions Account.
SPECIAL VESTING RULE FOR DEATH OR DISABILITY. If you die or
become disabled while still employed by the Employer, your
entire Plan interest becomes 100% vested, even if you otherwise
would have a vested interest less than 100%.
YEAR OF SERVICE. To determine your percentage under the vesting
schedule, a year of service means a 12-month vesting service
period in which you complete at least 1,000 hours of service.
The Plan measures the vesting service period as the plan year.
If you complete at least 1,000 during a plan year, you will
receive credit for a year of service even though you are not
employed by the Employer on the last day of that plan year.
You will receive credit for years of service with the Employer
prior to the time the Employer established the Plan and for
years of service prior to the time you became a participant in
the Plan. You will receive no vesting credit for employment
prior to age 18.
The Plan provides two methods of vesting forfeiture which may
apply before a participant becomes 100% vested in his entire
interest under the Plan. The primary method of vesting
forfeiture is the "forfeiture break in service" rule. The
secondary method of forfeiture is the "cash out" rule. Also see
Section (15) relating to loss or denial of benefits.
FORFEITURE BREAK IN SERVICE RULE. Termination of employment
alone will not result in a forfeiture under the Plan unless you
do not return to employment with the Employer before incurring a
"forfeiture break in service." A "forfeiture break in service"
is a period of 5 consecutive vesting service periods in which
you do not work more than 500 hours in each vesting service
period comprising the 5 year period.
EXAMPLE. Assume you are 60% vested in your account
balance. After working 400 hours during a particular vesting
service period, you terminate employment and perform no further
service
6<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
for the Employer during the next 4 vesting service
periods. Under this example, you would have a "forfeiture break
in service" during the fourth vesting service period following
the vesting service period in which you terminated employment
because you did not work more than 500 hours during any vesting
service period of 5 consecutive vesting service periods.
Consequently, you would forfeit the 40% non-vested portion of
your account. If you had returned to employment with the
Employer at any time during the 5 consecutive vesting service
periods and worked more than 500 hours during any vesting
service period within that 5-year period, you would not incur a
forfeiture under the "forfeiture break in service" rule.
CASH OUT RULE. The cash out rule applies if you terminate
employment and receive a total distribution of the vested
portion of your account balance before you incur a forfeiture
break in service. For example, assume you terminated employment
during a particular vesting service period after completing 800
hours of service. Assume further the total value of your
account balance is $6,000 in which you have a 60% vested
interest. Before you incur a forfeiture break in service, you
receive a distribution of the $3,600 vested portion of your
account balance. Upon payment of the $3,600 vested portion of
your account balance, you would forfeit the $2,400 nonvested
portion. If you return to employment before you incur a
"forfeiture break in service," you may have the Plan restore
your "cash out" forfeiture by repaying the amount of the
distribution you received attributable to Employer
contributions. This repayment right applies only if you do not
incur a "forfeiture break in service." You must make this
repayment no later than the date 5 years after you return to
employment with the Employer. Upon your reemployment with the
Employer, you may request the Plan Administrator to provide you
a full explanation of your rights regarding this repayment
option. If the vested portion of your account balance does not
exceed $3,500 ($5,000 beginning in 1998), the Plan will
distribute that vested portion to you in a lump sum, without
your consent. This involuntary cash-out distribution will result
in the forfeiture of your nonvested account balance, in the same
manner as an employee who voluntarily elects a cash-out
distribution. Also, upon reemployment you would have the same
repayment option as an employee who elected a cash-out
distribution, if you return to employment before incurring a
"forfeiture break in service."
If you are 0% vested in your entire interest in the Plan, the
Plan will treat you as having received a cash-out distribution
of $0. This "distribution" results in a forfeiture of your
entire Plan interest. Normally, this forfeiture occurs on the
date you terminate employment with the Employer. However, if
you are entitled to an allocation of Employer contributions for
the plan year in which you terminate employment with the
Employer, this forfeiture occurs as of the first day of the next
plan year. If you return to employment before you incur a
forfeiture break in service, the Plan will restore this
forfeiture, as if you repaid a cash-out distribution.
(11) PAYMENT OF BENEFITS AFTER TERMINATION OF EMPLOYMENT.
After you terminate employment with the Employer, the time at
which the Plan will commence distribution to you and the form of
that distribution depends on whether of your vested account
balance exceeds $3,500 ($5,000
7<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
beginning in 1998). If you receive a distribution from the Plan
before you attain age 55, the law imposes a 10% penalty on the
amount of the distribution you must include in your gross
income, unless you qualify for an exception from this penalty.
You should consult a tax advisor regarding this 10% penalty.
This summary makes references to your normal retirement age.
Normal retirement age under the Plan is 65.
NORMAL RETIREMENT AGE. Normal retirement age under the Plan is
age 65. You are 100% vested at normal retirement age.
EARLY RETIREMENT AGE. Early retirement age under the Plan is
age 55 if you have 10 years of service. You are 100% vested at
early retirement age.
DISTRIBUTIONS. If your vested account balance does not exceed
$3,500 ($5,000 beginning in 1998), the Plan will distribute that
portion to you, in lump sum, after you terminate employment with
the Employer, in accordance with the administrative procedures
of the Plan, within 60 days following the close of the Plan Year
in which you terminated employment. If you already have
attained normal retirement age when you terminate employment,
the Plan must make this distribution no later than the 60th day
following the close of the plan year in which your employment
terminates, even if the normal distribution date would occur
later. The Plan does not permit you to receive the distribution
in any form other than a lump sum if your vested account balance
does not exceed $3,500 ($5,000 beginning in 1998).
If your vested account balance exceeds $3,500 ($5,000 beginning
in 1998), the Plan will commence distribution to you at the time
you elect to commence distribution, within 60 days following the
close of the Plan Year in which you terminated employment. You
may not actually receive distribution on the distribution date
you elect. The Plan provides the Trustee an administratively
reasonable time following a particular distribution date to make
actual distribution to a participant in accordance with the
administrative procedures of the Plan.
No later than 30 days prior to your earliest possible
distribution date, the Plan Administrator will provide you a
notice explaining your right to elect distribution from the Plan
and the forms necessary to make your election and waive the 30-
day waiting period. If you do not make a distribution election,
the Plan will commence distribution to you on the 60th day
following the close of the plan year in which the latest of
three events occurs: (l) your attainment of age 65; (2) the 10th
anniversary of the year in which you commenced participation in
the Plan; or (3) your termination of employment with the
Employer. To determine whether your vested account balance
exceeds $3,500 ($5,000 beginning in 1998), the Plan looks to the
last valuation of your account prior to the scheduled
distribution date.
8<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
With limited exceptions, you may not commence distribution of
your vested account balance later than April 1 of the calendar
year following the calendar year in which you attain age 70-1/2,
except beginning in 1997, if you have not terminated employment
with the Employer and you are not a 5% owner. This required
distribution date overrides any contrary distribution date
described in this summary. If the Employer terminates the Plan
before you receive complete distribution of your vested
benefits, the Plan might make distribution to you before you
otherwise would elect distribution. Upon Plan termination, if
your vested account balance exceeds $3,500 ($5,000 beginning in
1998), you will receive an explanation of your distribution
rights.
For purposes of making a distribution of any portion of your
vested account balance, the Plan refers to the latest valuation
of your account balance. The Plan requires valuation of the
trust fund, and adjustment of participant accounts, as of
December 31. The Plan Administrator also may require a
valuation on any other date. You will not receive any
adjustment to your account balance for trust fund earnings after
the latest valuation date. In general, the Plan allocates trust
fund earnings, gains or losses for a valuation period on the
basis of each participant's opening account balance at the
beginning of the valuation period, less any distributions and
charges to each participant's account during the valuation
period.
FORMS OF BENEFIT PAYMENT. If your vested account balance
exceeds $3,500 ($5,000 beginning in 1998), the Plan permits you
to elect distribution under any one of the following methods:
(a) Lump sum; or
(b) Part lump sum and part installments, as described in (c);
or
(c) Installments payments (annually, quarterly or monthly)
over a specified period of time, not exceeding your life
expectancy or the joint life expectancy of you and your
beneficiary.
Under an installment distribution, the Plan Administrator may
direct to have the Plan segregate the amount owed to you in a
separate account apart from other trust fund assets. Your
separate account will continue to draw interest during the
period the Plan is making retirement payments to you. If the
Plan does not segregate the amount owed to you in a separate
account, your retirement account will remain a part of the trust
fund and continue to share in trust fund earnings, gains or
losses.
The benefit payment rules described in Sections (11) through
(14) reflect the current Plan provisions. If an Employer amends
its Plan to change benefit payment options, some options may
continue for those participants or beneficiaries who have
account balances at the time of the change. If an eliminated
option continues to apply to you, the information you receive
from the Plan Administrator at the time you first are eligible
for distribution from the Plan will include an explanation of
that option.
9<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
(12) Payment of Benefits Prior to Termination of Employment -
Hardship Withdrawals. Prior to your termination of employment,
you may elect to withdraw all or a portion of your Deferral
Contributions if you incur a hardship. A hardship
distribution is available only from your Deferral Contributions
Account, not including earnings on Deferral Contributions. A
hardship distribution must be on account of any of the
following: (1) deductible medical expenses incurred by you,
your spouse, or any of your dependents; (2) the purchase
(excluding mortgage payments) of a principal residence for you;
(3) the payment of post-secondary education tuition for the next
semester or next quarter, for you, your spouse, or for any of
your dependents; or (4) to prevent your eviction from your
principal residence or the foreclosure on the mortgage on your
principal residence. To qualify for the hardship distribution,
you may not make elective deferrals to the Plan for the 12-month
period following the date of your hardship distribution, you
must obtain all other available distributions and all
non-taxable loans currently available under the Plan and all
other qualified plans maintained by the Employer, and a special
limitation may apply to your elective deferrals in the following
taxable year.
Other than the withdrawal rights described in this Section (12),
the Plan does not permit you to receive payment of any portion
of your account balance unless you terminate employment.
(13) DISABILITY BENEFITS. If you terminate employment because
of disability, the Plan will pay your entire account balance to
you in lump sum at the same time as it would pay your vested
account balance for any other termination of employment.
However, if your vested account balance exceeds $3,500 ($5,000
beginning in 1998), the disability distribution rules are
subject to any election requirements described in Section (11).
In general, disability under the Plan means the inability to
engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment that can be
expected to result in death or which has lasted or can be
expected to last for a continuous period of not less than twelve
(12) months. The permanence and degree of such impairment shall
be supported by medical evidence.
(14) PAYMENT OF BENEFITS UPON DEATH. If you die prior to
receiving all of your benefits under the Plan, the Plan will pay
the balance of your account to your beneficiary.
The Plan Administrator will provide you with an appropriate form
for naming a beneficiary. If you are married, your spouse must
consent to the designation of any nonspouse beneficiary. If
your vested account balance payable to your designated
beneficiary does not exceed $3,500 ($5,000 beginning in 1998),
the Plan will pay the benefit, in lump sum, to your designated
beneficiary as soon as administratively practicable after your
death. If your vested account balance payable to you designated
beneficiary exceeds $3,500 ($5,000 beginning in 1998), the Plan
will pay the benefit to your designated beneficiary, in the form
and at the time elected by the beneficiary, unless, prior to
your death, you specify the timing and form of the beneficiary's
distribution. The benefit payment election generally must
complete distribution of your account balance within five years
of your
10<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
death, unless distribution commences within one year of
your death to your designated beneficiary or unless benefits had
commenced prior to your death under the mandatory post-age 70
1/2 distribution requirements described in Section (11).
(15) DISQUALIFICATION OF PARTICIPANT STATUS - LOSS OR DENIAL OF
BENEFITS. There are no specific Plan provisions which
disqualify you as a participant or which cause you to lose plan
benefits, except as provided in Sections (7) and (10). However,
if you become disabled and do not receive compensation from the
Employer, you will not receive an allocation of the Employer's
contribution to the Plan during the period of disability. In
addition, if your Plan benefits become payable after termination
of employment and the Plan Administrator is unable to locate you
at your last address of record, you may forfeit your benefits
under the Plan. Therefore, it is very important that you keep
the Employer apprised of your mailing address even after you
have terminated employment. Finally, if the Employer terminates
the Plan, which it has the right to do, you would receive
benefits under the Plan based on your account balance
accumulated to the date of the termination of the Plan.
Termination of the Plan could occur before you attain normal
retirement age. If the Employer terminates the Plan, your
account will become 100% vested, if not already 100% vested,
unless you forfeited the nonvested portion prior to the
termination date.
The termination of the Plan does not permit you to receive a
distribution from your Deferral Contributions Account, Qualified
Nonelective Contributions Account and Matching Contributions
Account unless: (1) you otherwise have the right to a
distribution, as described in Sections (11) and (12); or (2) the
Employer does not maintain a successor defined contribution
plan. If you are able to receive a distribution only because
the Employer does not maintain a successor defined contribution
plan, you must agree to take that distribution as part of a lump
sum payment of your entire account balance under the Plan. The
Trustee will transfer to the successor defined contribution plan
any portion of your interest the Plan is unable to distribute to
you.
The fact that the Employer has established this Plan does not
confer any right to future employment with the Employer.
Furthermore, you may not assign your interest in the Plan to
another person or use your Plan interest as collateral for a
loan from a commercial lender.
(16) CLAIMS PROCEDURE. You need not file a formal claim with
the Plan Administrator in order to receive your benefits under
the Plan. When an event occurs which entitles you to a
distribution of your benefits under the Plan, the Plan
Administrator automatically will notify you regarding your
distribution rights. However, if you disagree with the Plan
Administrator's determination of the amount of your benefits or
with any other decision the Plan Administrator may make
regarding your interest in the Plan, the Plan contains the
appeal procedure you should follow. In brief, if the Plan
Administrator of the Plan determines it should deny benefits to
you, the Plan Administrator will give you written notice of the
specific reasons for the denial. The notice will refer you to
the pertinent provisions of the Plan supporting the Plan
Administrator's decision. If you disagree with the Plan
11<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
Administrator, you, or a duly authorized representative, must
appeal the adverse determination in writing to the Plan
Administrator after the receipt of the notice of denial of
benefits. If you fail to appeal a denial, the Plan
Administrator's determination will be final and binding.
If you appeal to the Plan Administrator, you, or your duly
authorized representative, must submit the issues and comments
you feel are pertinent to permit the Plan Administrator to re-
examine all facts and make a final determination with respect to
the denial. The Plan Administrator, in most cases, will make a
decision within 60 days of a request on appeal unless special
circumstances would make the rendering of a decision within the
60-day period unfeasible. In any event, the Plan Administrator
must render a decision within 120 days after its receipt of a
request for review. The same procedures apply if, after your
death, your beneficiary makes a claim for benefits under the
Plan.
(17) RETIRED PARTICIPANT, SEPARATED PARTICIPANT WITH VESTED
BENEFIT, BENEFICIARY RECEIVING BENEFITS. If you are a retired
participant or beneficiary receiving benefits, the benefits you
presently are receiving will continue in the same amount and for
the same period provided in the mode of settlement selected at
retirement. If you are a separated participant with a vested
benefit, you may obtain a statement of the dollar amount of your
vested benefit upon request to the Plan Administrator. There is
no Plan provision which reduces, changes, terminates, forfeits,
or suspends the benefits of a retired participant, a beneficiary
receiving benefits or a separated participant's vested benefit
amount, except as provided in Section (15).
(18) PARTICIPANT'S RIGHTS UNDER ERISA. As a participant in
this Plan, you are entitled to certain rights and protections
under the Employee Retirement Income Security Act of 1974
(ERISA). ERISA provides that all Plan participants are entitled
to:
(a) Examine, without charge, at the Plan Administrator's
office and at other specified locations (such as work
sites), all Plan documents, including insurance contracts
and copies of all documents filed by the Plan with the
U.S. Department of Labor, such as detailed annual reports
and plan descriptions.
(b) Obtain copies of all Plan documents and other Plan
information upon written request to the Plan
Administrator. The Plan Administrator may make a
reasonable charge for the copies.
(c) Receive a summary of the Plan's annual financial report.
ERISA requires the Plan Administrator to furnish each
participant with a copy of this summary annual report.
(d) Obtain a statement telling you that you have a right to
receive a retirement benefit at the normal retirement age
under the Plan and what your benefit could be at normal
retirement age if you stop working under the Plan now. If
you do not have a right to a retirement
12<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
benefit, the statement will advise you of the number of
additional years you must work to receive a retirement
benefit. You must request this statement in writing. The
law does not require the Plan Administrator to give this
statement more than once a year. The Plan must provide the
statement free of charge.
In addition to creating rights for Plan participants, ERISA
imposes duties upon the people who are responsible for the
operation of the employee benefit plan. The people who operate
this Plan, called "fiduciaries" of the Plan, have a duty to do
so prudently and in the interest of you and other Plan
participants and beneficiaries. No one, including your Employer
or any other person, may fire you or otherwise discriminate
against you in any way to prevent you from obtaining a
retirement benefit or from exercising your rights under ERISA.
If your claim for a retirement benefit is denied in whole or in
part, you must receive a written explanation of the reason for
the denial. You have the right to have the Plan review and
reconsider your claim.
Under ERISA, there are steps you can take to enforce the above
rights. For instance, if you request materials from the Plan
and do not receive the materials within 30 days, you may file
suit in a Federal court. In such a case, the court may require
the Plan Administrator to provide the materials and pay you up
to $100 a day until you receive the materials, unless the
materials were not sent because of reasons beyond the control of
the Plan Administrator. If you have a claim for benefits which
is denied or ignored, in whole or in part, you may file suit in
a state or Federal court. If it should happen that Plan
fiduciaries misuse the Plan's money, or if you are discriminated
against for asserting your rights, you may seek assistance from
the U.S. Department of Labor, or you may file suit in a Federal
court. The court will decide who should pay court costs and
legal fees. If you are successful, the court may order the
person you have sued to pay these costs and fees. If you lose,
the court may order you to pay these costs and fees, for
example, if it finds your claim is frivolous.
If you have any questions about your Plan, you should contact
the Plan Administrator. If you have any questions about this
statement or about your rights under ERISA, you should contact
the nearest Area Office of the U.S. Labor-Management Services
Administration, Department of Labor.
(19) FEDERAL INCOME TAXATION OF BENEFITS PAID. Existing
Federal income tax laws do not require you to report as income
the portion of the annual Employer contribution allocated to
your account. However, when the Plan later distributes your
account balance to you, such as upon your retirement, you must
report as income the Plan distributions you receive. The
Federal tax laws may permit you to report a Plan distribution
under a special averaging provision. Also, it may be possible
for you to defer Federal income taxation of a distribution by
making a "rollover" contribution to your own rollover individual
retirement account or to another qualified plan. We emphasize
you should
13<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
consult your own tax adviser with respect to the proper method
of reporting any distribution you receive from the
Plan.
(20) LOANS. The Plan permits the Plan Administrator to make
loans to participants and beneficiaries.
CRITERIA. The Plan Administrator determines, in a uniform and
nondiscriminatory manner, whether you qualify for a loan,
applying criteria like a commercial lender of funds would apply.
Criteria include, among others, your creditworthiness, your
general ability to repay the loan, the period of time you have
been employed by the Employer, whether adequate security has
been provided for the loan, and whether you agree, as a
condition for receiving the loan, to make substantially equal
repayments over the term of the loan, through direct, after-tax
payroll deductions, on a payroll.
AMOUNTS. In addition to other requirements, you must specify
the intended purpose of the loan and show that the loan will be
used for that purpose. Loans generally will be offered for the
following reasons:
1. Purchase or refurbishment of a home;
2. Payment of secondary or post-secondary
education;
3. Purchase of a new or used car to be used for
transportation to and from work or to
transport children to school;
4. Medical expenses not paid for or reimbursed by
the Medical Plan or Plans maintained by the
Employer;
5. For purposes of taking a regularly scheduled
vacation; or
6. To meet emergency liquidity requirements of
the Plan participant.
INTEREST RATE. Any loan granted or renewed must bear a
reasonable rate of interest. Such rate of interest shall be one
percentage point greater than the average prevailing interest
rate charged on similar commercial loans by area banks, as
determined by the Plan Administrator.
SECURITY. Adequate security at least equal to the amount of the
loan is required before a loan is granted. For this purpose,
your interest under the Plan is considered the only adequate
security.
14<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
DEFAULT. Generally, a loan default occurs if you fail to timely
pay the loan when due. In such event, the Plan Administrator
takes such reasonable actions which a prudent fiduciary in like
circumstances would take to protect and preserve Plan assets,
including accelerating the loan, foreclosing on any collateral,
and commencing legal action for collection. If the qualified
status of the Plan is not jeopardized, the Plan Administrator
may treat a loan in default and not cured within a reasonable
period of time as a deemed distribution from the Plan.
DOCUMENTATION. Upon satisfaction of the criteria established
for granting a loan, the Plan Administrator may qualify you to
receive a loan. In making such determination, the Plan
Administrator may consider the liquidity of the Plan assets
available for loans. The Plan Administrator requires that you
execute all documents necessary to establish the loan, including
a promissory note and such other documents which will provide
the Plan with adequate security, as determined by the Plan
Administrator. The Plan Administrator determines the term,
interest rate and other provisions of the loan within the limits
of applicable laws. Prepayment is permitted.
(21) INVESTMENT IN EMPLOYER SECURITIES. The Plan permits you
to direct the investment of part or all of your account balance
in Employer securities. The portion of your account which you
do not direct for investment in Employer securities will be
invested by Home Federal Bank as trustee.
The Employer securities to which you may direct your Plan
account balance are the common stock of the employer, Newport
Federal Savings and Loan Association. The investment objective
for this stock is capital growth, and it has characteristics of
average to high potential risk and greater than average
potential return.
To direct all or a portion of your account balance to be
invested in Employer securities, you must deliver your
investment instructions in writing to the Plan Administrator or
Trustee. You must use the form the Plan Administrator provides.
Complete the form carefully. It cannot be accepted if it is
incomplete.
You may give investment instructions to the Plan Administrator
or Trustee 15 days before January 1 or July 1. Your
instructions become effective as of the following January 1 or
July 1. Your most recent instruction will remain in effect
until you submit new instructions according to these rules. If
you do not provide any instructions, your account balance will
be invested by the trustee, but not in Employer securities.
The Plan Administrator may exercise all voting, tender or
similar rights, if any, attendant to ownership of the Employer
securities.
When you initially invest in Employer securities, the Plan
Administrator will give you a copy of the most recently issued
prospectus for the stock. Additional information is available
on the Employer
15<PAGE>
<PAGE>
Summary Plan Description for Newport Federal Savings and
Loan Association 401(k) Retirement Plan
securities by requesting it from the Plan Administrator,
including the most recent prospectus, financial statements,
reports and share values.
The Plan Administrator and the trustee have established
procedures to ensure the confidentiality of your investments in
Employer securities. Examples of these procedures are:
(a) Only persons needing to know will have access to
information regarding your investment in employer securities.
Such restricted information includes any records of any
purchase, sale or retention of employer securities under the
Plan on your behalf. Persons with access to these records may
include the trustee and administrative personnel appointed,
employed or retained by the trustee. Management staff of the
employer will not have access to these records except as
necessary in providing services to the Plan.
(b) You may deliver in person or by mail any written
investment directives regarding employer securities to the
office of the trustee (Home Federal Bank of Tennessee, 515
Market Street, Knoxville, Tennessee 37902).
(c) In the event of any circumstance which involves
potential for undue employer influence, including tender offers,
exchange offers or contested board elections, the Plan
Administrator will appoint an independent Plan fiduciary to
administer these activities. In the sole exercise of its
discretion, the Plan Administrator may appoint an independent
Plan fiduciary at any time.
The Plan Administrator will monitor the effectiveness of these
procedures. The Plan Administrator will establish any new
procedures that become necessary, and will advise you regarding
those procedures in writing as soon as possible.
NEWPORT FEDERAL SAVINGS AND LOAN ASSOCIATION
401(K) RETIREMENT PLAN
ACCOUNT ELECTION FORM
---------------------
Name _____________________ Social Security Number ______________
I _______________________ a Newport Federal 401(K) participant,
direct the trustee to buy (whole shares) of Newport Federal
Savings and Loan Association common stock as permitted by
section 17(d) of the plan adoption agreement.
AUTHORIZATION
-------------
________________________________ __________________________
Date Participant's Signature
Received by:____________________ Date Received ____________
Plan Administrator
Received by:________________________ Date Received ____________
Home Federal Bank of TN<PAGE>
<PAGE>
NEWPORT FEDERAL SAVINGS AND LOAN ASSOCIATION
401(k) RETIREMENT PLAN
---------------------------------------------
Investment Election Form
---------------------------------------------
Participant Information:
- -----------------------
Name: _____________________________ SSN: ___________________
Address: ____________________________________________________
INVESTMENT CHANGE
- -----------------
ELECTION TO CHANGE INVESTMENT FUNDS. I direct that as soon
as practicable after the date on which Home Federal Bank of
Tennessee (the "Trustee") receives this Investment Election
Form, my prior investment elections with respect to the
Common Stock Fund shall be revised in the following manner:
________% (rounded to the next lower whole share) of
the shares of Common Stock of United Tennessee
Bankshares, Inc. that are allocated to my account
under the Plan shall be transferred out of the Common
Stock Fund and reinvested (in cash), in the Trustee's
sole discretion, among the Plan's other investment
funds.
Participant's Signature: ________________________ Date: _______
EMPLOYER USE ONLY
Date received Authorized Signature Effective Date of Change
________________________________________________________________
NOTE: Investment Election Forms may be submitted to the
Company's Executive Offices by 5:00 p.m. EST on any business
day.
INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
Plan Description: Prototype Standardized Profit
Sharing Plan with CODA
FFM: 50297066801-001 Case: 8907661 EIN: 62-1230706
BPD: 01 Plan: 001 Letter Serial No. D247643a
Washington, DC 20224
HOME FEDERAL BANK OF TENNESSEE FSB Person Contact:
Ms. Arrington
521 MARKET STREET Telephone Number:
(202) 566-4576
KNOXVILLE, TN 37902 Refer Reply to:
E:EP:Q:ICU
Date: 05/10/90
Dear Applicant:
In our opinion, the form of the plan identified above is
acceptable under section 401 of the Internal Revenue Code for
use by employers for the benefit of their employees. This
opinion relates only to the acceptability of the form of the
plan under the Internal Revenue Code. It is not an opinion of
the effect of other Federal or local statutes.
You must furnish a copy of this letter to each employer who
adopts this plan. You are also required to send a copy of the
approved form of the plan, any approved amendments and related
documents to each Key District Director of Internal Revenue
Service in whose jurisdiction there are adopting employers.
Our opinion on the acceptability of the form of the plan is not
a ruling or determination as to whether an employer's plan
qualifies under Code section 401(a). An employer who adopts
this plan will be considered to have a plan qualified under Code
section 401(a) provided all the terms of the plan are followed,
and the eligibility requirements and contribution or benefit
provisions are not more favorable for officers, owners or highly
compensated employees than for other employees. Except as
stated below, the Key District Director will not issue a
determination letter with regard to this plan.
Our opinion does not apply to the form of the plan for purposes
of Code section 401(a)(16) if: (1) an employer ever maintained
another qualified plan for one or more employees who are covered
by this plan, other than a specified paired plan within the
meaning of section 7 of Rev. Proc. 89-9, 1989-6 I.R.B. 14; or
(2) after December 31, 1985, the employer maintains a welfare
benefit fund defined in Code section 419(e), which provides
postretirement medical benefits allocated to separate accounts
for key employees as defined in Code section 419A(d)(3). In
such situations, the employer should request a determination as
to whether the plan, considered with all related qualified plans
and, if appropriate, welfare benefit funds, satisfies the
requirements of Code section 401(a)(16) as to limitations on
benefits and contributions in Code section 415.
The plan identified above is not a replacement plan as defined
in section 3.10 of Rev. Proc. 89-9, 1989-6 I.R.B. 14.
Therefore, an adopting employer may not rely on this opinion
letter to extend the remedial amendment period under section
401(b) of the Code and regulations thereunder.
If you, the plan sponsor, have any questions concerning the IRS
processing of this case, please call the above telephone number.
This number is only for use of the plan sponsor. Individual
participants and/or adopting employers with questions concerning
the plan should contact the plan sponsor. The plan's adoption
agreement must include the sponsor's address and telephone
number for inquiries by adopting employers.
If you write to the IRS regarding this plan, please provide your
telephone number and the most convenient time for us to call in
case we need more information. Whether you call or write,
please refer to the Letter Serial Number and File Folder Number
shown in the heading of this letter.
You should keep this letter as a permanent record. Please
notify us if you modify or discontinue sponsorship of this plan.
Sincerely yours,
Chief, Employee Plans Qualifications Branch
<TABLE>
<CAPTION>
Form 5500-C/R Return/Report of Employee Benefit Plan OMB Nos. 1210-0016
Department of the Treasury (With fewer than 100 participants) 1210-0089
Internal Revenue Service This form is required to be filed under sections 104 and 4065 of the Employee
---------- Retirement Income Security Act of 1974 and sections 6039D, 6047(e), -------------------
Department of Labor 6057(b), and 6058(a) of the Internal Revenue Code. 1996
Pension and Welfare Benefits Administration See separate instructions. -------------------
---------- This Form is Open
Pension Benefit Guaranty Corporation to Public Inspection.
- ------------------------------------------------------------------------------------------------------------------------------------
For the calendar plan year 1996 or fiscal plan year beginning and ending
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
If A(1) through A(4), B, C, and/or D do not apply to this year's return/report For IRS Use Only
leave the boxes unmarked. EP-ID
You must check either box A(5) or A(6), whichever is applicable. See instructions. -------------------------------------------
A This return/report is: (5) Form 5500-C filer check here. . . . [_]
(1) [_] the first return/report filed for the plan; (Complete only pages 1 and 3 through 6)
(2) [_] an amended return/report (Code section 6039D filers see
(3) [_] the final return/report filed for the plan; or instructions on page 5.)
(4) [_] a short plan year return/report (less than 12 months). (6) Form 5500-R filer check here. . . . [X]
(Complete only pages 1 and 2. Detach
pages 3 through 6 before filing.) If
you checked box (1) or (3), you must
file a Form 5500-C. (See page 6 of the
instructions.)
IF ANY INFORMATION ON A PREPRINTED PAGE 1 IS INCORRECT, CORRECT IT. IF ANY INFORMATION IS MISSING, ADD IT. PLEASE USE RED INK WHEN
MAKING THESE CHANGES AND INCLUDE THE PREPRINTED PAGE 1 WITH YOUR COMPLETED RETURN/REPORT.
B Check here if any information reported in 1a, 2a, 2b, or 5a changed since the last return/report for this plan . . . . . [_]
C If your plan year changed since the last return/report, check here. . . . . . . . . . . . . . . . . . . . . . . . . . . . [_]
D If you filed for an extension of time to file this return/report, check here and attach a copy of the approved extension. [_]
- --------------------------------------------------------------------------------------------------------------------------------
1a Name and address of plan sponsor (employer, if for a single-employer plan) 1b Employer identification number (EIN)
(Address should include room or suite no.) 62-0309135
---------------------------------------
1c Sponsor's telephone number
Newport Federal Savings and Loan Association (423) 623-6088
1303 West Broadway Street ---------------------------------------
Newport, TN 37821 1d Business code (see instructions,
page 17)
6120
---------------------------------------
1e CUSIP issuer number
N/A
- --------------------------------------------------------------------------------------------------------------------------------
2a Name and address of administrator (if same as plan sponsor, enter "Same") 2b Administrator's EIN
SAME ---------------------------------------
2c Administrator's telephone number
- ---------------------------------------------------------------------------------------------------------------------------------
3 If you are filing this page without the preprinted historical plan information and the name, address, and EIN of the plan
sponsor or plan administrator has changed since the last return/report filed for this plan, enter the information from the last
return/report on lines 3a and/or 3b and complete line 3c.
a Sponsor ________________________________________________ EIN _________________ Plan number ________________
b Administrator ________________________________ EIN ____________________________________________
c If line 3a indicates a change in the sponsor's name, address, and EIN, is this a change in sponsorship only? (See line 3c on
page 8 of the instructions for the definition of sponsorship.) Enter "Yes" or "No."
- ------------------------------------------------------------------------------------------------------------------------------------
4 ENTITY CODE. (If not shown, enter the applicable code from page 8 of the instructions.) A
- ------------------------------------------------------------------------------------------------------------------------------------
5a Name of plan Newport Federal Savings & Loan Association 401(k) Retirement Plan 5b Effective date of plan
-------------------------------------------------------------------- (mo., day, yr.)
01/01/86
--------------------------------------------------------------------------------- ---------------------------------------
5c Three-digit
All filers must complete 6a through 6d, as applicable. plan number 002
6a [_] Welfare benefit plan 6b [X] Pension benefit plan ---------------------------------------
(If the correct codes are not preprinted below, enter the applicable codes ] [_] [_] [_] [_] [_] [_] [_] [_]
in the boxes.) ] [2] [_] [_] [_] [_] [_] [_] [_]
6-defined contribution plan/multiple employer-other
6c Pension plan features. (If the correct codes are not preprinted below, enter the applicable
pension plan feature codes in the boxes.) [_] [_] [_] [_] [G] [_] [K] [_]
6d [_] Fringe benefit plan. Attach Schedule F (Form 5500).
- ------------------------------------------------------------------------------------------------------------------------------------
Caution: A penalty for the late or incomplete filing of this return/report will be assessed unless reasonable cause is established.
- ------------------------------------------------------------------------------------------------------------------------------------
Under penalties of perjury and other penalties set forth in the instructions, I declare that I have examined this return/report,
including accompanying schedules and statements, and to the best of my knowledge and belief, it is true, correct, and complete.
Signature of employer/plan sponsor /s/ Richard Harwood Date 2-11-97
-------------------------------------------------------------- ----------------------------
Type or print name of individual signing for employer/plan sponsor
----------------------------------------------------------------
Signature of plan administrator _____________________________________________________ Date _________________________
Type or print name of individual signing above
- ------------------------------------------------------------------------------------------------------------------------------------
For Paperwork Reduction Act Notice, see page 1 of the instructions. Form 5500-C/R (1996)
<PAGE>
Form 5500-C/R (1996) Form 5500-R filers, complete pages 1 and 2 only. Form 5500-C filers, complete page 1, Page 2
skip page 2, and complete pages 3 through 6.
- ------------------------------------------------------------------------------------------------------------------------
6e Check investment arrangement below
(1) [_] Master trust (2) [X] Common/Collective trust (3) [_] Pooled separate account
- ------------------------------------------------------------------------------------------------------------------------
7a Total participants: (1) At the beginning of plan year 17 (2) At the end of plan year 17
b Enter number of participants with account balances at the end of the plan year (defined benefit plans do not
complete this item) 17
c (1) Were any participants in the pension benefit plan separated from service with a deferred vested
benefit for which a Schedule SSA (Form 5500) is required to be attached?7c(1) (_)Yes (X)No
(2) If "Yes," enter the number of separated participants required to be reported 0
- ------------------------------------------------------------------------------------------------------------------------
8a Was this plan terminated during this plan year or any prior plan year? If "Yes," enter the year8a (_)Yes (X)No
b Were all the plan assets either distributed to participants or beneficiaries, transferred to another
plan, or brought under the control of PBGC? . . . . . . . . . .8b (_)Yes (X)No
c If line 8a is "yes" and the plan is covered by PBGC, is the plan continuing to file PBGC Form 1 and
pay premiums until the end of the plan year in which assets are distributed or brought under the
control of PBGC?. . . . . . . . . . . . . . . . . . . . . . . . . . . . 8c N/A
- ------------------------------------------------------------------------------------------------------------------------
9 Is this a plan established or maintained pursuant to one or more collective bargaining agreements?9 (_)Yes (X)No
- ------------------------------------------------------------------------------------------------------------------------
10 If any benefits are provided by an insurance company, insurance service, or similar organization, enter the number
of Schedules A (Form 5500), Insurance Information, that are attached. If none, enter - 0 -. - 0 -
- ------------------------------------------------------------------------------------------------------------------------
11a (1) Were any plan amendments adopted during this plan year?11a(1) (_)Yes (X)No
(2) Enter the date the most recent amendment was adopted Month 05 Day 16 Year 95
b If line 11a is "Yes," did any amendment result in a retroactive reduction of accrued benefits for any participant?
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11b ___
c If line 11a is "Yes," did any amendment change the information contained in the latest summary plan description or
summary description of modifications available at the time of the amendment?11c ___
d If line 11c is "Yes," has a summary plan description or summary description of modifications that reflects the plan
amendments referred to on line 11c been both furnished to participants and filed with the Department of Labor?
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11d ___
- ------------------------------------------------------------------------------------------------------------------------
12a If this is a pension benefit plan subject to the minimum funding standards, has the plan experienced a funding
deficiency for this plan year? . . . . . . . . . . . . . . . . . . . .12a N/A
b If line 12a is "Yes," have you filed Form 5330 to pay the excise tax?.12b ___
c Is the plan administrator making an election under section 412(c)(8) for an amendment adopted after the end of the
plan year? . . . . . . . . . . . . . . . . . . . . . . . . . 12c (_)Yes (X)No
d If a change in the actuarial funding method was made for the plan year pursuant to a Revenue Procedure providing
automatic approval for the change, indicate whether the plan sponsor/administrator agrees to the change12d N/A
- ------------------------------------------------------------------------------------------------------------------------
13a Total plan assets as of the beginning 556,150 and end 642,338 of the plan year
b Total liabilities as of the beginning and end of the plan year
c Net assets as of the beginning 556,150 and end 642,338 of the plan year
- ------------------------------------------------------------------------------------------------------------------------
14 For this plan year, enter: a Plan income 104,158 d Plan contributions 46,886
b Expenses 17,970 e Total benefits paid 17,970
c Net income (loss)(subtract 14b from 14a) 86,188
- ------------------------------------------------------------------------------------------------------------------------
15 You may NOT use N/A in response to lines 15a through 15o. If you check "Yes," you must enter a dollar amount in the
amount column. During this plan year:
a Was this plan covered by a fidelity bond?. . 15a (X)Yes (_)No 1,000,000Amount
b If line 15a is "Yes," enter the name of the surety company St. Paul Fire & Marine Insurance Co.
c Was there any loss to the plan, whether or not reimbursed, caused by fraud or dishonesty?15c (_)Yes (X)No
d Was there any sale, exchange, or lease of any property between the plan and the employer, any fiduciary, any of the
five most highly paid employees of the employer, any owner of a 10% or more interest in the employer, or relatives
of any such persons? . . . . . . . . . . . . . . . . . . . . 15d (_)Yes (X)No
e Was there any loan or extension of credit by the plan to the employer, any fiduciary, any of the five most highly
paid employees of the employer, any owner of a 10% or more interest in the employer, or relatives of any such
persons? . . . . . . . . . . . . . . . . . . . . . . . . . . 15e (_)Yes (X)No
f Did the plan acquire or hold any employer security or employer real property?15f (_)Yes (X)No
g Has the plan granted an extension on any delinquent loan owed to the plan?15g (_)Yes (X)No
h Were any participant contributions transmitted to the plan more than 31 days after receipt or withholding by the
employer?. . . . . . . . . . . . . . . . . . . . . . . . . . 15h (_)Yes (X)No
i Were any loans by the plan or fixed income obligations due the plan classified as uncollectible or in default as of
the close of the plan year?. . . . . . . . . . . . . . . . . 15i (_)Yes (X)No
j Has any plan fiduciary had a financial interest in excess of 10% in any party providing services to the plan or
received anything of value from any such party?. . . . . . . 15j (_)Yes (X)No
k Did the plan at any time hold 20% or more of its assets in any single security, debt, mortgage, parcel of real
estate, or partnership/joint venture interests?15k (X)Yes (_)No 137,438Amount
l Did the plan at any time engage in any transaction or series of related transactions involving 20% or more of the
current value of plan assets?. . . . . . . . .15l (X)Yes (_)No 657,076Amount
m Were there any noncash contributions made to the plan the value of which was set without an appraisal by an
independent third party? . . . . . . . . . . . . . . . . . . 15m (_)Yes (X)No
n Were there any purchases of nonpublicly traded securities by the plan the value of which was set without an
appraisal by an independent third party? . . . . . . . . . . 15n (_)Yes (X)No
o Has the plan reduced or failed to provide any benefit when due under the plan because of insufficient assets?
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15o (_)Yes (X)No
- ------------------------------------------------------------------------------------------------------------------------
16a Is the plan covered under the Pension Benefit Guaranty Corporation termination insurance program? (_)Yes (X)No
(_)Not determined
b If line 16a is "Yes" or "Not determined," enter the employer identification number and the plan number used to
identify it.
Employer identification number Plan number
- ------------------------------------------------------------------------------------------------------------------------
4200129 736883 61440-100NFS 020 NEWPORT FEDERAL SAVINGS & LOAN 02977526
</TABLE>
<PAGE>
<PAGE>
Plan Name: Newport Federal S&L Assoc. 401(k) Retirement Plan
--------------------------------------------------
EIN:62-6219008 Plan Number: ___________ Plan Year End: 12/31/96
---------- --------
ATTACHMENT TO ENCLOSED FORM 5500, 5500-C/R
Disclosure of Information Regarding Common/Collective Trusts
The Plan Administrator hereby certifies that it has received a
copy of the most recent statement of assets and liabilities of
the Common/Collective Trusts in which all or a portion of the
plan assets are invested. A copy of the statement of the assets
and liabilities of the Common/Collective Trusts has been
submitted directly to DOL by the trustee.
Note:
Item 31(c)(11), Form 5500
Item 27(c)(5), Form 5500-C
Item 13(a) and/or (c), Form 5500-R.
The Common/Collective Trust(s) in which plan assets are invested
are marked in the left margin below.
<TABLE>
<CAPTION>
EI#
----------
<S> <C> <C>
Third National Bank in Nashville 62-0859925
Trustee
[x] SunTrust Bank 62-6116672
Retirement Short Term Bond Fund
[x] SunTrust Bank 58-1244691
SunTrust Retirement Reserve Fund
[ ] SunTrust Bank 59-6935667
SunTrust Employee Benefit Equity Fund
[x] SunTrust Bank 59-6476538
SunTrust Corporate Equity Fund
[ ] SunTrust Bank 62-6155645
SunTrust Employee Benefit Real Estate Fund
[x] SunTrust Bank 58-6037825
SunTrust Retirement Fixed Income Fund
[x] SunTrust Bank 62-1240517
SunTrust Employee Benefit Stable Asset Fund
[ ] SunTrust Bank 58-1418391
SunTrust Retirement Sunbelt Equity Fund
</TABLE>
