<PAGE>
EXHIBIT 4.6
UNITED RENTALS, INC. 401(k) INVESTMENT PLAN
<PAGE>
UNITED RENTALS, INC. 401(k) INVESTMENT PLAN
Table of Contents
-----------------
<TABLE>
<CAPTION>
Page
----
<S> <C>
ARTICLE I
Establishment of the Plan
1.1 Restatement of Plan........................................... 1
1.2 Restatement of Trust.......................................... 1
1.3 Effective Date................................................ 1
1.4 Name and Designation.......................................... 2
1.5 Withdrawal of Affiliated Companies............................ 2
ARTICLE II
Definitions
2.1 Account....................................................... 3
2.2 Administrator................................................. 3
2.3 Affiliated Company............................................ 3
2.4 Beneficiary................................................... 3
2.5 Board......................................................... 3
2.6 Break in Service.............................................. 4
2.7 Code.......................................................... 5
2.8 Company....................................................... 5
2.9 Compensation.................................................. 5
2.10 Credited Service.............................................. 7
2.11 Effective Date................................................ 7
2.12 Elective Deferrals............................................ 7
2.13 Employee...................................................... 8
2.14 Employer...................................................... 8
2.15 Employer Contribution......................................... 8
2.16 Employment Commencement Date.................................. 8
2.17 Entry Dates................................................... 8
2.18 ERISA......................................................... 8
2.19 Fiduciary..................................................... 9
2.20 Fiscal Year................................................... 9
2.21 Highly Compensated Employee................................... 9
2.22 Hour of Service............................................... 10
</TABLE>
<PAGE>
-ii-
<TABLE>
<S> <C>
2.23 Matching Contributions........................................... 11
2.24 Net Profits...................................................... 11
2.25 Normal Retirement Age............................................ 11
2.26 Participant...................................................... 11
2.27 Plan............................................................. 12
2.28 Plan Year........................................................ 12
2.29 Prior Employer................................................... 12
2.30 Qualified Matching Contributions................................. 12
2.31 Qualified Military Service....................................... 12
2.32 Qualified Nonelective Contributions.............................. 13
2.33 Rollover Contributions........................................... 13
2.34 Termination of Employment........................................ 13
2.35 Total and Permanent Disability................................... 14
2.36 Transaction Date................................................. 14
2.37 Trust............................................................ 14
2.38 Trustee.......................................................... 14
2.39 Valuation Date................................................... 14
2.40 Vesting Computation Period....................................... 14
2.41 Year of Credited Service......................................... 14
ARTICLE III
Eligibility
3.1 Participation.................................................... 15
3.2 Exclusions From Eligibility...................................... 16
3.3 Leased Employees................................................. 17
3.4 Treatment of Qualified Military Service.......................... 18
ARTICLE IV
Contributions
4.1 Employer Contributions........................................... 18
4.2 Payment.......................................................... 19
4.3 Company Determination............................................ 20
4.4 Elective Deferrals............................................... 20
4.5 Rollover Contributions........................................... 22
4.6 Restored Contributions........................................... 23
4.7 Direct Transfers................................................. 23
4.8 Limits for Highly Compensated.................................... 24
4.9 Correction of Excess Contributions............................... 29
4.10 Correction of Excess Aggregate Contributions..................... 33
</TABLE>
<PAGE>
-iii-
<TABLE>
<S> <C>
4.11 Correction of Excess Deferrals................................... 37
4.12 Correction of Multiple Use....................................... 40
ARTICLE V
Individual Accounts
5.1 Individual Accounts.............................................. 40
5.2 Allocation of Contributions...................................... 42
5.3 Allocation of Forfeitures........................................ 43
5.4 Allocation of Earnings........................................... 43
5.5 Investment Direction............................................. 44
ARTICLE VI
Termination of Employment
6.1 Normal Retirement................................................ 46
6.2 Late Retirement.................................................. 47
6.3 Disability Retirement............................................ 47
6.4 Termination Due to Death......................................... 47
6.5 Other Termination of Employment.................................. 48
6.6 Qualified Domestic Relations Orders.............................. 49
6.7 Lost Beneficiary................................................. 53
6.8 Offsets.......................................................... 54
ARTICLE VII
Payment of Benefits
7.1 General.......................................................... 54
7.2 Form of Payment.................................................. 55
7.3 Direct Rollovers................................................. 55
7.4 Notice and Payment Elections..................................... 58
7.5 Mandatory Distributions.......................................... 59
7.6 Commencement of Benefits......................................... 59
7.7 Payments to Incompetents......................................... 60
7.8 Income Tax Withholding........................................... 61
</TABLE>
<PAGE>
-iv-
<TABLE>
<S> <C>
ARTICLE VIII
Distributions to Beneficiaries
8.1 General........................................................... 61
8.2 Normal Form of Payment............................................ 61
8.3 Beneficiary Designation........................................... 61
8.4 Commencement of Payment........................................... 63
ARTICLE IX
Withdrawals and Loans
9.1 Withdrawals....................................................... 63
9.2 Hardship Withdrawals.............................................. 64
9.3 Loans............................................................. 67
ARTICLE X
Contribution and Benefit Limitations
10.1 Contribution Limits............................................... 72
10.2 Overall Limits.................................................... 73
10.3 Annual Adjustments to Limits...................................... 73
10.4 Excess Amounts.................................................... 74
10.5 Definitions....................................................... 75
ARTICLE XI
Top-Heavy Rules
11.1 General........................................................... 77
11.2 Vesting........................................................... 78
11.3 Minimum Contribution.............................................. 78
11.4 Definitions....................................................... 79
11.5 Special Rules..................................................... 83
11.6 Adjustment of Limitations......................................... 84
ARTICLE XII
Administration of the Plan
12.1 Committee as Administrator........................................ 85
12.2 Procedures........................................................ 85
</TABLE>
<PAGE>
-v-
<TABLE>
<S> <C>
12.3 Bond and Compensation............................................. 86
12.4 Duties of the Committee........................................... 86
12.5 Allocation and Delegation of Responsibilities..................... 87
12.6 Committee Accounts................................................ 87
12.7 Company to Furnish Information.................................... 88
12.8 Expenses.......................................................... 88
12.9 Indemnification................................................... 88
12.10 Reports .......................................................... 88
ARTICLE XIII
Claims Procedure
13.1 Claims Submission................................................. 89
13.2 Claim Review...................................................... 89
13.3 Right of Appeal................................................... 90
13.4 Review of Appeal.................................................. 90
13.5 Designation....................................................... 91
ARTICLE XIV
Amendments
14.1 Right to Amend.................................................... 91
14.2 Limitations....................................................... 91
14.3 Amendment to Vesting Schedule..................................... 91
ARTICLE XV
Termination
15.1 Right to Terminate................................................ 92
15.2 Full Vesting on Termination....................................... 92
15.3 Partial Termination............................................... 93
15.4 Distribution on Termination....................................... 93
15.5 Affect on Benefits................................................ 95
ARTICLE XVI
Miscellaneous
16.1 IRS Approval...................................................... 95
16.2 No Assignment..................................................... 95
</TABLE>
<PAGE>
-vi-
<TABLE>
<S> <C>
16.3 Merger.......................................................... 96
16.4 Governing Law................................................... 96
16.5 Construction.................................................... 96
16.6 Company Determinations.......................................... 97
16.7 Counterpart Originals........................................... 97
16.8 Affect on Employment Rights..................................... 97
</TABLE>
<PAGE>
UNITED RENTALS, INC. 401(k) INVESTMENT PLAN
ARTICLE I
Establishment of the Plan
-------------------------
1.1 Restatement of Plan. United Rentals, Inc., a Delaware corporation
-------------------
(the "Company"), does hereby amend, restate and continue this Plan to provide
retirement benefits for Employees (or their Beneficiaries in the event that an
Employee dies before retirement). The Plan was originally established,
effective January 1, 1998, through the adoption of the Special Prototype Defined
Contribution Plan (Base Plan Document #03) sponsored by Merrill Lynch, Pierce,
Fenner & Smith, Incorporated (Letter Serial Number D359287b; National Office
letter dated 6/29/93). The Plan was subsequently amended and restated effective
May 1, 1998. In accordance with the provisions of section 11.1.2 of the
prototype plan, by adopting this Plan, the Company will no longer participate in
the prototype plan and will be considered to have an individually designed plan
under section 401(a) of the Code.
1.2 Restatement of Trust. To implement the provisions of this Plan, the
--------------------
Trustees do hereby amend, restate and continue, as an individually designed
trust, the prototype trust adopted as part of the Special Prototype Defined
Contribution Plan sponsored by Merrill Lynch, Pierce, Fenner & Smith,
Incorporated, adopted by the Company on May 18, 1998, to receive, invest and
distribute contributions and earnings thereon. The Trust, as established
hereunder, shall be the sole source of benefits under the Plan and the Employer
shall not have any liability for the adequacy of the benefits provided under the
Plan.
1.3 Effective Date. This Plan and the accompanying Trust shall be
--------------
effective as of May 1, 1998, except as otherwise stated herein.
<PAGE>
-2-
1.4 Name and Designation. The name of the Plan is the United Rentals,
--------------------
Inc. 401(k) Investment Plan. The name of the Trust is the United Rentals, Inc.
401(k) Investment Trust. The Plan is a defined contribution, discretionary
profit sharing plan/401(k) plan.
1.5 Withdrawal of Affiliated Companies.
----------------------------------
(a) An Affiliated Company's adoption of this Plan may be terminated,
voluntarily or involuntarily, at any time, as provided in this section.
(b) An Affiliated Company shall withdraw from the Plan and Trust if
the Plan and Trust, with respect to that Affiliated Company, fail to qualify
under sections 401(a) and 501(a) of the Code (or, in the opinion of the
Trustees, they may fail to so qualify) and the continued sponsorship of that
Affiliated Company may jeopardize the status, with respect to the Employer, of
the Plan and Trust under sections 401 and 501(a) of the Code. An Affiliated
Company that no longer qualifies as an Affiliated Company shall withdraw from
the Plan and Trust if so directed by the Administrator. The Affiliated Company
shall receive at least thirty (30) days prior written notice of a withdrawal
under this subsection, unless a shorter period is agreed to.
(c) An Affiliated Company may voluntarily withdraw from the Plan and
Trust for any reason. Such withdrawal requires at least thirty (30) days
written notice to the Administrator and the Trustees, unless a shorter period is
agreed to.
(d) Upon withdrawal, the Trustees shall segregate the assets
attributable to Employees of the withdrawn Affiliated Company, the amount
thereof to be determined by the Administrator and the Trustees. The segregated
assets shall be held, paid to another trust, distributed or otherwise disposed
of as is appropriate under the
<PAGE>
-3-
circumstances; provided, however, that any transfer shall be for the exclusive
benefit of Participants and their Beneficiaries. A withdrawal of an Affiliated
Company from the Plan is not necessarily a termination under ARTICLE XV. If the
withdrawal is a termination then the provisions of ARTICLE XV shall also be
applicable.
ARTICLE II
Definitions
-----------
2.1 Account. The individual bookkeeping account established for each
-------
Participant, as provided in section 5.1.
2.2 Administrator. The person, persons, corporation, committee, group or
-------------
organization designated to be the Administrator of the Plan and to perform the
duties of the Administrator.
2.3 Affiliated Company. Any corporation or other entity that, together
------------------
with the Company, constitutes a member of a controlled group within the meaning
of sections 414(b) or (c) of the Code, constitutes a member of an affiliated
service group, within the meaning of section 414(m) of the Code, or constitutes
any other entity required to be aggregated under section 414(o) of the Code.
All such entities, whether or not incorporated, shall be treated as a single
employer to the extent required by the Code.
2.4 Beneficiary. The person or persons (including a trust or trusts) who
-----------
are entitled to receive benefits from a deceased Participant's Account after
such Participant's death (whether or not such person or persons are expressly so
designated by the Participant).
2.5 Board. The board of directors of the Company.
-----
<PAGE>
-4-
2.6 Break in Service.
----------------
(a) A twelve (12) consecutive month period commencing on a
Participant's Termination of Employment (and subsequent anniversaries thereof)
during which the Participant does not perform any Hours of Service.
(b) (1) In computing Hours of Service to determine whether a person
has a Break in Service, a person shall be credited with up to five hundred one
(501) Hours of Service based on the person's previous customary service with
the Employer for any period of absence from work as a result of:
(A) the pregnancy of such person;
(B) the birth of a child of such person;
(C) the placement of a child with such person in connection
with the adoption of such child by such person; or
(D) the caring for such child for a period beginning
immediately following such birth or placement.
(2) If the previous customary service cannot be determined, then
such credit shall be at the rate of eight (8) Hours of Service per day.
(c) The Hours of Service credited under subsection (b) shall be
credited in the Vesting Computation Period in which the absence from work
begins, if the person would be prevented from having a Break in Service in such
Vesting Computation Period solely because of the Hours of Service credited under
subsection (b). If the person would not be prevented from having a Break in
Service during the period described in the
<PAGE>
-5-
preceding sentence, then such Hours of Service shall be credited in the Vesting
Computation Period immediately following those in which such absence from work
begins.
(d) No credit shall be given under subsection (b) unless such person
furnishes the Administrator with information necessary to establish that the
absence is for one of the reasons enumerated in subsection (b) and the number of
days of such absence.
2.7 Code. The Internal Revenue Code of 1986, as amended.
----
2.8 Company. United Rentals, Inc., a Delaware corporation.
-------
2.9 Compensation.
------------
(a) All of the wages as defined in section 3401(a) of the Code (for
purposes of income tax withholding at the source), but determined without regard
to any rules that limit the remuneration included in wages based on the nature
or location of the employment or the services performed. This definition shall
be interpreted in a manner consistent with the requirements of section 414(s) of
the Code.
(b) Compensation as defined in subsection (a) shall exclude the
following items (even if includable in gross income):
(1) reimbursements or other expense allowances;
(2) fringe benefits (cash and noncash);
(3) moving expenses;
<PAGE>
-6-
(4) deferred compensation;
(5) welfare benefits; and
(6) stock options.
(c) Compensation as defined in subsection (a) shall include
(notwithstanding subsection (b)) the following:
(1) elective contributions that are made by the Employer on
behalf of its Employees that are not includable in income under section 125,
section 402(a)(8), section 402(h), or section 403(b);
(2) Compensation deferred under an eligible deferred
compensation plan within the meaning of section 457(b); and
(3) Employee contributions (under governmental plans) described
in section 414(h)(2) that are picked up by the employing unit and thus are
treated as employer contributions.
(4) Bonuses and commissions.
(d) The Compensation of each Employee for any year shall not exceed
one hundred fifty thousand dollars ($150,000); provided, however, that this
limit shall be adjusted in the same manner and at the same time as under section
415(d) of the Code, in accordance with regulations under section 401(a)(17) of
the Code. Compensation for Highly Compensated Employees shall be determined in
accordance with the provisions of section 2.21.
<PAGE>
-7-
(e) Unless otherwise indicated herein, Compensation shall be
determined only on the basis of amounts paid during the Plan Year, including any
Plan Year with a duration of fewer than twelve (12) months.
2.10 Credited Service.
----------------
(a) An Employee's elapsed period of employment from the Employee's
Employment Commencement Date to the Employee's Termination of Employment,
subject to the adjustments specified in this section. In computing Credited
Service, all periods of employment with an Affiliated Company and a Prior
Employer shall be included.
(b) If an Employee performs any Hours of Service within the twelve
(12) months following such Employee's Termination of Employment, then the period
from such Termination of Employment to the performance of the Hour of Service
shall also be treated as a period of Credited Service.
(c) If an Employee has periods of Credited Service that are not
consecutive, all such periods of Credited Service (whether or not consecutive)
shall be aggregated to determine the person's Credited Service.
2.11 Effective Date. May 1, 1998.
--------------
2.12 Elective Deferrals. Contributions by Participants to the Trust that
------------------
are made in accordance with section 4.4 and that qualify for treatment under
section 401(a)(8) of the Code. An Employee's election to make Elective
Deferrals may be made only with respect to an amount that the Employee could
otherwise elect to receive in cash and that is not currently available to the
Employee.
<PAGE>
-8-
2.13 Employee. Except to the extent otherwise provided herein, any person
--------
employed by an Employer, who is expressly so designated as an Employee on the
books and records of the Employer, and who is treated as such by the Employer
for federal employment tax purposes. Any person who, after the close of a Plan
Year, is retroactively treated by the Employer or any other party as an Employee
for such prior Plan Year shall not, for purposes of the Plan, be considered an
Employee for such prior Plan Year unless expressly so treated as such by the
Employer. Before January 1, 1999, the term "Employee" shall only include
individuals who have attained age twenty-one (21) and who are regularly
scheduled to work at least thirty-five (35) hours per week. On and after
January 1, 1999, "Employee" shall only include individuals who have attained age
twenty-one (21) and are regularly scheduled to work at least thirty (30) hours
per week.
2.14 Employer. The Company, any Affiliated Company, and any other entity
--------
that has adopted the Plan and is listed on Appendix A attached hereto.
2.15 Employer Contribution. Any contributions by the Employer to the Trust
---------------------
(other than Qualified Nonelective Contributions or Qualified Matching
Contributions) as set forth in ARTICLE IV.
2.16 Employment Commencement Date. The day on which an Employee first
----------------------------
performs an Hour of Service.
2.17 Entry Dates. The first day of the month following the date an
-----------
Employee meets the eligibility requirements.
2.18 ERISA. The Employee Retirement Income Security Act of 1974, as
-----
amended.
<PAGE>
-9-
2.19 Fiduciary. Any person who exercises any discretionary authority or
---------
discretionary control over the management of the Plan, or exercises any
authority or control respecting management or disposition of Plan assets; who
renders investment advice for a fee or other compensation, direct or indirect,
as to assets held under the Plan, or has any authority or discretionary
responsibility in the administration of the Plan. This definition shall be
interpreted in accordance with section 3(21) of ERISA.
2.20 Fiscal Year. The taxable year of the Company for federal income tax
-----------
purposes. Such taxable year, at the time of the Effective Date of this Plan,
shall be the twelve (12) month period beginning on January 1 and ending on
December 31.
2.21 Highly Compensated Employee
---------------------------
(a) Any Employee who:
(1) is a five percent (5%) owner at any time during the Plan
Year or the preceding Plan Year; or
(2) for the preceding Plan Year received Compensation in excess
of the amount specified in section 414(q)(1)(B)(i) of the Code.
(b) Former Employees will be treated as Highly Compensated Employees
if the former Employee was a Highly Compensated Employee at the time of his or
her separation from service or the former Employee was a Highly Compensated
Employee at any time after attaining age fifty-five (55).
(c) The dollar amounts incorporated under subsection (a)(2)(A) shall
be adjusted as provided in section 414(q)(1) of the Code.
<PAGE>
-10-
(d) For purposes of this section, the term "Compensation" means
compensation as defined under section 415(c)(3) of the Code.
(e) This section shall be interpreted in a manner consistent with
section 414(q) of the Code and the regulations thereunder and shall be
interpreted to permit any elections permitted by such regulations to be made.
2.22 Hour of Service.
---------------
(a) Any hour for which an Employee is directly or indirectly paid (or
entitled to payment) by an Employer for the performance of duties as an
Employee, as determined from the appropriate records of the Employer.
(b) In computing Hours of Service, an Employee shall also be credited
with Hours of Service based on the person's previous customary service with the
Employer (not exceeding either eight (8) hours per day or forty (40) hours per
week), for the following periods:
(1) periods (limited to a maximum of five hundred one (501)
hours for any single, continuous period) for which the Employee is directly or
indirectly paid for reasons other than the performance of duties, such as
vacation, holiday, sickness, disability, layoff, jury duty or military duty;
(2) periods for which any federal law requires that credit for
service be given; and
(3) periods for which back pay (irrespective of mitigation of
damages) is either awarded or agreed to by the Employer.
<PAGE>
-11-
(c) The provisions of subsection (b) shall be further limited to
prevent duplication by only permitting an Employee to receive credit for one (1)
Hour of Service for any given hour.
(d) Hours of Service shall be computed and credited in accordance
with the Department of Labor regulations under section 2530.200b.
(e) Service with a Prior Employer shall be credited as if it were
service with an Employer for purposes of determining an Employee's Hours of
Service. This subsection (e) shall only apply to individuals who are Employees
on or after January 1, 1999.
2.23 Matching Contributions. The contributions by the Employer to the
----------------------
Trust that are allocated to a Participant's Account by reason of the
Participant's Elective Deferrals.
2.24 Net Profits. The current and accumulated net profits of the Employer
-----------
before deducting federal and state income taxes (and the Matching Contribution
under this Plan) as computed by the Employer in accordance with generally
accepted accounting principles. Net Profits shall not include any extraordinary
nonrecurring payments or settlements received by the Employer.
2.25 Normal Retirement Age. The date upon which a Participant attains age
---------------------
sixty-two (62).
2.26 Participant. A person who has been admitted as a Participant in the
-----------
Plan under ARTICLE III and who has not received a distribution of all the funds
credited to his or her Account (or had such funds fully forfeited). In the case
of an eligible Employee who makes a Rollover Contribution to the Plan under
section 4.5 prior to
<PAGE>
-12-
becoming a Participant, such Employee shall, until he or she becomes a
Participant under ARTICLE III, be considered a Participant for the limited
purposes of maintaining and receiving his or her Rollover Contribution
subaccount under the terms of the Plan.
2.27 Plan. The United Rentals, Inc. 401(k) Investment Plan, including any
----
amendments thereto.
2.28 Plan Year. The annual twelve (12) month period beginning on the first
---------
day of January and ending on December 31.
2.29 Prior Employer. An entity in which the Company or an Affiliated
--------------
Company acquired a controlling interest through the purchase of stock or other
equitable interest, acquired substantially all of the assets used by such entity
in a separate trade or business, or merged into the Company or an Affiliated
Company. For this purpose, an entity shall be considered to be a Prior Employer
with respect to a Participant only if the Participant was employed by the entity
immediately before the Transaction Date and became an Employee within a
reasonable period of time after the Transaction Date.
2.30 Qualified Matching Contributions. Matching contributions which,
--------------------------------
pursuant to the election made by the Employer, and in accordance with Code
section 401(m), are nonforfeitable when made and subject to the limitation on
distributions set forth in the definition of Qualified Nonelective
Contributions.
2.31 Qualified Military Service. Any period of duty on a voluntary or
--------------------------
involuntary basis in the United States Armed Forces, the Army National Guard and
the Air National Guard when engaged in active duty for training, inactive duty
for training or full-time National Guard duty, the commissioned corps of the
Public Health Service and any other category of persons designated by the
President of the United States in time of war or emergency. Such periods of
duty shall include active duty, active duty for
<PAGE>
-13-
training, initial active duty for training, inactive duty training, full-time
National Guard duty and absence from employment for an examination to determine
fitness for such duty.
2.32 Qualified Nonelective Contributions. Any contribution by the Employer
-----------------------------------
to the Trust pursuant to section 4.1(b). Qualified Nonelective Contributions
are one hundred percent (100%) vested when made and are distributable as
provided herein, but in no event before the earlier of:
(a) the Participant's Termination of Employment, death or Total and
Permanent Disability;
(b) the Participant's attainment of age fifty-nine and one-half (59
1/2);
(c) the termination of the Plan without establishment or maintenance
of another defined contribution plan (other than an employee stock ownership
plan);
(d) the disposition of substantially all of the assets used by the
Employer in a trade or business of the Employer but only with respect to an
Employee who continues employment with the entity acquiring such assets; or
(e) the disposition of the Employer's interest in a subsidiary, but
only with respect to an Employee who continues employment with such subsidiary.
2.33 Rollover Contributions. A transfer that qualifies under either
----------------------
section 402(c), section 403(a)(4) or section 408(d)(3)(A)(ii) of the Code.
2.34 Termination of Employment. The earlier of:
-------------------------
<PAGE>
-14-
(a) the date on which a Participant retires, is discharged or dies as
an Employee of the Employer; or
(b) the first anniversary of the date on which a Participant
commenced to be absent from service as an Employee of the Employer if the
absence is for any reason not specified in subsection (a), above.
2.35 Total and Permanent Disability. Any medically determinable physical
------------------------------
or mental disorder that renders a Participant incapable of continuing in the
employment of the Employer and is expected to continue for a period not less
than twelve (12) months.
2.36 Transaction Date. The closing date of an acquisition of a Prior
----------------
Employer.
2.37 Trust. The United Rentals, Inc. 401(k) Investment Trust, including
-----
any amendments thereto.
2.38 Trustees. The Trustee (or Trustees) under United Rentals, Inc. 401(k)
--------
Investment Trust as may be designated from time to time by the Company in
accordance with the provisions of the Trust.
2.39 Valuation Date. The Plan shall use daily valuations.
--------------
2.40 Vesting Computation Period. The Plan Year.
--------------------------
2.41 Year of Credited Service. A period of Credited Service that equals
------------------------
three hundred sixty-five (365) days. All lesser periods of Credited Service are
disregarded in determining a Participant's Years of Credited Service.
<PAGE>
-15-
ARTICLE III
Eligibility
-----------
3.1 Participation.
-------------
(a) Except as described in subsections (b), (c), (d), (e) and (f)
below, each Employee and any person who subsequently becomes an Employee shall
become a Participant on the first day of the month coincident with or next
following the Employee's six- (6) month anniversary of his or her Employment
Commencement Date and attainment of age twenty-one (21).
(b) Each individual who had attained age twenty-one (21) and (i) who
was an Employee on or before March 31, 1998 or (ii) who became an Employee in
connection with the acquisition of a Prior Employer that had a Transaction Date
on or before March 31, 1998, shall be entitled to become a Participant in the
Plan as of May 1, 1998.
(c) Any individual who has attained age twenty-one (21) and who
became an Employee in connection with the acquisition of a Prior Employer that
had a Transaction Date on or after April 1, 1998, shall be entitled to become a
Participant in the Plan as of the first day of the month following the date
which is thirty (30) days after the Transaction Date.
(d) If an Employee who has satisfied the participation requirements
fails to become a Participant due to a separation from employment but
subsequently becomes an Employee again without having a Break in Service, then
such Employee shall, on reemployment by the Employer, immediately become a
Participant.
<PAGE>
-16-
(e) A Participant who has a Termination of Employment and, subsequent
to the Termination of Employment, again becomes an Employee, shall be reinstated
as a Participant as of the date of reemployment subsequent to the Termination of
Employment.
(f) If an Employee who is eligible to participate in the Plan does
not join the Plan when he or she is first eligible to join, then such Employee
may subsequently join the Plan, but only as of the first day of a calendar
quarter. Such Employee must submit a salary reduction election form to the Plan
Administrator at least ten (10) days before the first payroll period beginning
on or after the first day of a calendar quarter.
3.2 Exclusions from Eligibility.
---------------------------
(a) Any person described in subsection (b) of this section shall not
be eligible to become a Participant, notwithstanding the provisions of section
3.1. Any person who ceases to be described in subsection (b) of this section
shall thereafter be eligible to become a Participant in accordance with the
requirements of section 3.1.
(b) A person shall be excluded from eligibility to become a
Participant if:
(1) such person is described in section 3.3 or is a person who
performs services for the Employer but is not hired as an Employee;
(2) such person is included in a unit of Employees covered by an
agreement that the Secretary of Labor finds to be a collective bargaining
agreement between Employee representatives and the Employer, if there is
evidence that retirement
<PAGE>
-17-
benefits were the subject of good faith bargaining between such Employee
representatives and the Employer; or
(3) such person is a nonresident alien who received no earned
income from the Employer which constitutes income from sources within the Untied
States.
(4) such person was hired by the Company or an Affiliated
Company to work on a temporary basis.
3.3 Leased Employees.
----------------
(a) If an Employer receives the services of a Leased Employee, such
Leased Employee shall, for purposes of this section, be treated as an Employee
in accordance with the provisions of section 414(n) of the Code.
(b) If the Employer receives the services of Leased Employees who
comprise less than twenty percent (20%) of the Employer's Non-Highly Compensated
Work Force, then, for purposes of subsections (c)(1)(A) and (c)(1)(B), section
3.3 shall not apply to such Leased Employees if they are covered by a money
purchase pension plan sponsored by the leasing organization that provides (1)
immediate participation, (2) a nonintegrated employer contribution of at least
ten percent (10%) of such person's compensation and (3) full and immediate
vesting.
(c) The following terms shall have the meanings specified:
(1) Leased Employee. Any person who is not an Employee of the
---------------
Employer and who provides services to the Employer if:
<PAGE>
-18-
(A) such services are provided pursuant to an agreement
between the Employer and the leasing organization; and
(B) such person has performed such services for the
Employer on a substantially full-time basis for a period of at least one (1)
year; and
(C) such services are performed under the primary direction
or control of the Employer.
(2) Non-Highly Compensated Work Force. The aggregate number of
---------------------------------
individuals (other than Highly Compensated Employees) who are:
(A) Employees of the Employer (other than Leased Employees)
who have performed services for the Employer on a substantially full-time basis
for a period of at least one (1) year; and
(B) Leased Employees.
3.4 Treatment of Qualified Military Service. Notwithstanding any
---------------------------------------
provision of this Plan to the contrary, contributions, benefits and service
credit with respect to Qualified Military Service will be provided in accordance
with section 414(u) of the Code.
ARTICLE IV
Contributions
-------------
4.1 Employer Contributions.
----------------------
(a) Matching Contributions. For the Plan Year commencing May 1, 1998
----------------------
and each Plan Year thereafter, the Employer shall contribute to the Trust
Matching
<PAGE>
-19-
Contributions in such amounts (if any) and at such times as determined by the
Employer in its sole discretion. If the Employer decides to make Matching
Contributions for a Plan Year, the Employer shall also specify the percentage of
each Participant's Elective Deferrals that will be matched by such Matching
Contribution and any other limits on the amount of Matching Contributions that
will be made.
(b) Qualified Nonelective Contributions. Each Plan Year the Employer
-----------------------------------
may contribute to the Trust such amounts as determined by the Employer in its
sole discretion. Any amounts contributed under this subsection are to be
designated by the Employer as Qualified Nonelective Contributions.
(c) Qualified Matching Contributions. Each Plan Year the Employer may
--------------------------------
contribute to the Trust such amounts as determined by the Employer in its sole
discretion. Any amounts contributed under this subsection are to be designated
by the Employer as Qualified Matching Contributions.
4.2 Payment.
-------
(a) Except as otherwise provided herein, the Employer shall pay to
the Trustees in U.S. currency, or by other property acceptable to the Trustees,
all Employer Contributions, Qualified Nonelective Contributions and Qualified
Matching Contributions for each Fiscal Year within the time prescribed by law,
including extensions granted by the Internal Revenue Service for filing its
federal income tax return for such Fiscal Year.
(b) Elective Deferrals shall be paid over to the Trust within the
time prescribed by ERISA.
<PAGE>
-20-
(c) Qualified Nonelective Contributions and Qualified Matching
Contributions made under sections 4.1(b) and 4.1(c), respectively, shall be paid
to the Trust at such time or times during or after a Plan Year as the Employer
determines.
4.3 Company Determination. The Board shall act on behalf of the Employers
---------------------
and shall determine the amount of all contributions to be made to the Trust
under the terms of the Plan. The Board's determination of the Employer
Contributions, Qualified Nonelective Contributions and Qualified Matching
Contributions shall be final, conclusive and binding on all Participants, the
Trustees and other parties. The Trustees shall have no right or duty to inquire
into the amount of the Employer Contribution, Qualified Nonelective
Contributions or Qualified Matching Contributions or the method used in
determining the amounts thereof.
4.4 Elective Deferrals.
------------------
(a) A Participant may make voluntary Elective Deferrals to the Trust
in each Plan Year pursuant to and in accordance with the Plan and such rules as
the Administrator may establish from time to time. A Participant's Elective
Deferrals may not exceed fifteen percent (15%) of such Participant's
Compensation. Elective Deferrals shall be fully vested and nonforfeitable.
(b) (1) Notwithstanding anything contained herein to the contrary,
the Elective Deferrals of a Participant shall be limited in accordance with the
provisions of this section, section 4.8 and any other applicable provisions of
the Plan. The Administrator may refuse to accept any or all prospective
Elective Deferrals to be contributed by a Participant.
(2) The aggregate Elective Deferrals of a Participant for any
taxable year of that Participant shall be limited to ten thousand dollars
($10,000), with
<PAGE>
-21-
such amount adjusted for cost-of-living to the extent permitted under sections
402(g)(5) and 415(d) of the Code. The foregoing limit in this paragraph shall be
reduced for a Participant to the extent such Participant in such year makes
elective deferrals (as defined in section 402(g)(3) of the Code) to any other
plan.
(3) Elective Deferrals shall not be permitted to the extent they
would cause the Annual Additions to exceed the limits specified in ARTICLE X.
(c) Elective Deferrals shall be collected by the Company by a
reduction in Compensation in accordance with rules that the Administrator may
establish from time to time. Any amounts so collected shall be transmitted to
the Trustees as soon as administratively feasible, but no later than the
fifteenth (15/th/) business day of the month following the month in which the
Elective Deferrals would otherwise have been payable to the Participant in cash.
Participants may change the amounts designated to be deducted as follows:
(1) Complete discontinuance of Elective Deferrals may be made at
any time and will be effective as of the first payroll period beginning after
the Administrator receives the completed forms from the Participant.
(2) Any other changes in Elective Deferrals (including
reactivating discontinued Elective Deferrals) shall only be permitted as of the
first business day of each calendar quarter and will be effective as of the
first administratively feasible payroll period beginning thereafter.
(d) If Elective Deferrals are made by a Participant in excess of the
limits in subsection (b)(2) of this section, then such excess (together with any
earnings thereon) may, in the Administrator's sole discretion, be distributed
to such Participant in
<PAGE>
-22-
accordance with section 402(g)(2) of the Code. The Administrator may make any
special allocations of earnings or other amounts necessary to carry out such
distribution.
(e) Elective Deferrals by a Participant who has received a hardship
distribution under section 9.2 shall be limited to the extent necessary to
satisfy those requirements.
4.5 Rollover Contributions.
----------------------
(a) Rollover Contributions may be made to the Plan in accordance with
the provisions of this section.
(b) The Administrator shall accept any Rollover Contribution if, in
its sole discretion, it determines that acceptance of such Rollover Contribution
will not jeopardize the exempt status of the Plan or Trust.
(c) An individual making a Rollover Contribution shall be entitled to
have it invested and may withdraw it as provided in the Plan. Distributions of
amounts attributable to Rollover Contributions shall be made in the same manner
as distributions of other amounts credited to such Participant under the Plan.
(d) A Rollover Contribution will not be accepted unless (i) the
individual on whose behalf the Rollover Contribution will be made is either a
Participant or an eligible Employee who has notified the Administrator that he
or she intends to become a Participant as of the first day on which he or she is
eligible therefor, and (ii) all required information, including selection of
specific investment accounts, is provided to the Administrator.
<PAGE>
-23-
4.6 Restored Contributions.
----------------------
(a) A Participant who (i) receives a distribution of the vested
portion of his or her Account under section 6.5 (due to a Termination of
Employment), and (ii) again becomes a Participant in accordance with section
3.1(e) without having had five (5) consecutive Breaks in Service since such
distribution, shall have the right to repay the full amount of the distribution
received under section 6.5. Such repayment shall be made to the Administrator.
(b) If a Participant makes a repayment under subsection (a), such
Participant's Account shall be restored to the full amount of the Account
balance that existed at the time the distribution referred to in subsection (a)
was made. Such restoration may, in the Administrator's sole discretion, be made
from Employer Contributions, forfeitures or Trust earnings, and shall be treated
as a special allocation that supersedes the normal allocation rules in ARTICLE
V.
4.7 Direct Transfers.
----------------
(a) The Plan shall accept a transfer of assets directly from another
plan qualified under section 401(a) of the Code only if the Administrator, in
its sole discretion, agrees to accept such a transfer. In determining whether
to accept such a transfer, the Administrator shall consider the administrative
inconvenience engendered by such a transfer and any risks to the continued
qualification of the Plan under section 401(a) of the Code. Acceptance of any
such transfer shall not preclude the Administrator from refusing any such
subsequent transfers.
(b) Any transfer of assets accepted under this section shall be
separately accounted for at all times and shall remain subject to the provisions
of the transferor plan (as it existed at the time of such transfer) to the
extent required by section
<PAGE>
-24-
411(d)(6) of the Code (including, but not limited to, any rights to qualified
joint and survivor annuities and qualified preretirement survivor annuities) as
if such provisions were part of the Plan. In all other respects, however, such
transferred assets will be subject to the provisions of the Plan.
(c) Assets accepted under this section shall be fully vested and
nonforfeitable.
4.8 Limits for Highly Compensated.
-----------------------------
(a) Elective Deferrals, Company Contributions and Qualified
Nonelective Contributions allocable to the Accounts of Highly Compensated
Employees shall not in any Plan Year exceed the limits specified in this
section. The Administrator may make the adjustments authorized in this section
to ensure that the limits of subsection (b) (or any other applicable limits) are
not exceeded, regardless of whether such adjustments affect some Participants
more than others. This section shall be administered and interpreted in
accordance with sections 401(k) and 401(m) of the Code.
(b) (1) The Actual Deferral Percentage of the Highly Compensated
Employees shall not exceed, in any Plan Year, the greater of:
(A) one hundred twenty-five percent (125%) of the Actual
Deferral Percentage for all other Eligible Participants; or
(B) the lesser of two hundred percent (200%) of the Actual
Deferral Percentage for all other Eligible Participants or the Actual Deferral
Percentage for the other Eligible Participants plus two (2) percentage points.
<PAGE>
-25-
(2) The Actual Contribution Percentage of the Highly Compensated
Employees shall not exceed, in any Plan Year, the greater of:
(A) one hundred twenty five percent (125%) of the Actual
Contribution Percentage for all other Eligible Participants; or
(B) the lesser of two hundred percent (200%) of the Actual
Contribution Percentage for all other Eligible Participants or the Actual
Contribution Percentage for the other Eligible Participants plus two (2)
percentage points.
(3) The sum of the Actual Deferral Percentage and the Actual
Contribution Percentage for the Highly Compensated Employees shall not exceed,
in any Plan Year, the sum of:
(A) one hundred twenty-five percent (125%) of the greater
of:
(i) the Actual Deferral Percentage of the other
Eligible Participants; or
(ii) the Actual Contribution Percentage of the other
Eligible Participants; and
(B) two plus the lesser of:
(i) the amount in paragraph (3)(A)(i); or
<PAGE>
-26-
(ii) the amount in paragraph (3)(A)(ii); provided that
the amount in this paragraph (3)(B) shall not exceed two hundred percent (200%)
of the lesser of the amount in paragraph (3)(A)(i) or the amount in paragraph
(3)(A)(ii).
(4) The limitations under section 4.8(b)(3) shall be modified to
reflect any higher limitations provided by the Internal Revenue Service under
regulations, notices or other official statements.
(c) The following terms shall have the meanings specified:
(1) Actual Contribution Percentage. The average of the ratios
------------------------------
for a designated group of Employees (calculated separately for each Employee in
the group) of the sum of the Company Contributions (other than those treated as
part of the Actual Deferral Percentage), Qualified Nonelective Contributions
(other than those treated as part of the Actual Deferral Percentage), Employee
Contributions and Elective Deferrals (other than those treated as part of the
Actual Deferral Percentage) allocated for the applicable year on behalf of the
Participant, divided by the Participant's Compensation for such applicable year.
The "applicable year" for determining the Actual Contribution Percentage for the
group of Highly Compensated Employees shall be the current Plan Year. For all
other Eligible Participants, the "applicable year" for determining the Actual
Contribution Percentage shall be the immediately preceding Plan Year, unless in
accordance with the procedures prescribed by the Internal Revenue Service, the
Administrator elects to use the current Plan Year.
(2) Actual Deferral Percentage. The average of the ratios for a
--------------------------
designated group of Employees (calculated separately for each Employee in the
group) of the sum of the Elective Deferrals, Qualified Nonelective Contributions
and Company Contributions (that the Company elects to have treated as part of
the Actual Deferral Percentage) allocated for the applicable year on behalf of a
Participant, divided by the
<PAGE>
-27-
Participant's Compensation for such applicable year. The "applicable year" for
determining the Actual Deferral Percentage for the group of Highly Compensated
Employees shall be the current Plan Year. For all other Eligible Participants,
the "applicable year" for determining the Actual Deferral Percentage shall be
the immediately preceding Plan Year, unless in accordance with the procedures
prescribed by the Internal Revenue Service, the Administrator elects to use the
current Plan Year.
(3) Compensation. To the extent regulations permit the
------------
definition of Compensation in ARTICLE II to be used, then such definition shall
be applied for purposes of this ARTICLE; provided, however, that to the extent
such definition is not so permitted, then Compensation shall include all
compensation required to be counted under section 414(s) of the Code; provided
further, however, that this definition shall not apply for purposes of the
definition of Highly Compensated Employee in section 2.21.
(4) Eligible Participant. Any Employee of the Company who is
--------------------
authorized under the terms of the Plan to make Elective Deferrals or have
Qualified Nonelective Contributions allocated to his or her Account for the Plan
Year.
(d) For purposes of determining whether a plan satisfies the Actual
Contribution Percentage test of section 401(m), all Employee and matching
contributions that are made under two (2) or more plans that are aggregated for
purposes of section 401(a)(4) and 410(b) (other than section 410(b)(2)(A)(ii))
are to be treated as made under a single plan and that if two (2) or more plans
are permissively aggregated for purposes of section 401(m), the aggregated plans
must also satisfy section 401(a)(4) and 410(b) as though they were a single
plan.
(e) In calculating the Actual Contribution Percentage for purposes of
section 401(m), the actual contribution ratio of a Highly Compensated Employee
will be
<PAGE>
-28-
determined by treating all plans subject to section 401(m) under which the
Highly Compensated Employee is eligible (other than those that may not be
permissively aggregated) as a single plan.
(f) For purposes of determining whether a plan satisfies the Actual
Deferral Percentage test of section 401(k), all elective contributions that are
made under two (2) or more plans that are aggregated for purposes of section
401(a)(4) or 410(b) (other than section 410(b)(2)(A)(ii)) are to be treated as
made under a single plan and that if two (2) or more plans are permissively
aggregated for purposes of section 401(k), the aggregated plans must also
satisfy sections 401(a)(4) and 410(b) as though they were a single plan.
(g) In calculating the Actual Deferral Percentage for purposes of
section 401(k), the actual deferral ratio of a Highly Compensated Employee will
be determined by treating all cash or deferred arrangements under which the
Highly Compensated Employee is eligible (other than those that may not be
permissively aggregated) as a single arrangement.
(h) An elective contribution will be taken into account under the
Actual Deferral Percentage test of section 401(k)(3)(A) of the Code for a Plan
Year only if it is allocated to the Employee as of a date within that Plan Year.
For this purpose, an elective contribution is considered allocated as of a date
within a Plan Year if the allocation is not contingent on participation or
performance of services after such date and the elective contribution is
actually paid to the Trust no later than twelve (12) months after the Plan Year
to which the contribution relates.
(i) For purposes of determining whether a plan satisfies the Actual
Contribution Percentage test of section 401(k), all elective contributions that
are made under two (2) or more plans that are aggregated for purposes of section
401(a)(4) or
<PAGE>
-29-
410(b) (other than section 410(b)(2)(A)(ii)) are to be treated as made under a
single plan and that if two or more plans are permissively aggregated for
purposes of section 401(k), the aggregated plans must also satisfy sections
401(a)(4) and 410(b) as though they were a single plan.
4.9 Correction of Excess Contributions.
----------------------------------
(a) Excess Contributions shall be corrected as provided in this
section. The Administrator may also prevent anticipated Excess Contributions as
provided in this section. The Administrator may use any method of correction or
prevention provided in this section or any combination thereof, as it determines
in its sole discretion. This section shall be administered and interpreted in
accordance with sections 401(k) and 401(m) of the Code.
(b) The Administrator may refuse to accept any or all prospective
Elective Deferrals to be contributed by a Participant.
(c) (1) The Company may, in its sole discretion, elect to
contribute, as provided in section 4.1(b), a Qualified Nonelective Contribution
in an amount necessary to satisfy any or all of the requirements of section 4.8.
(2) Qualified Nonelective Contributions for a Plan Year shall
only be allocated to the Accounts of Participants who are not Highly Compensated
Employees. Qualified Nonelective Contributions shall be allocated first to the
Participant with the lowest Compensation for that Plan Year and any remaining
Qualified Nonelective Contributions thereafter shall be allocated to the
Participant with the next lowest Compensation for that Plan Year. This
allocation method shall continue in ascending order of Compensation until all
such Qualified Nonelective Contributions are allocated. The allocation to any
Participant shall not exceed the limits under section 415
<PAGE>
-30-
of the Code. If two or more Participants have identical Compensation, the
allocations to them shall be proportional.
(3) Qualified Nonelective Contributions for a Plan Year shall be
contributed to the Trust within twelve (12) months after the close of such Plan
Year.
(4) Qualified Nonelective Contributions shall only be allocated
to Participants who receive Compensation during the Plan Year for which such
contribution is made.
(d) The Administrator may, during a Plan Year, distribute to a
Participant (or such Participant's Beneficiary if the Participant is deceased),
any or all Excess Contributions or Excess Deferrals (whether Elective Deferrals,
Company Contributions or Qualified Nonelective Contributions) allocable to that
Participant's Account for that Plan Year, notwithstanding any contrary provision
of the Plan. Such distribution may include earnings or losses (if any)
attributable to such amounts, as determined by the Administrator.
(e) (1) The Administrator may recharacterize any or all Excess
Contributions for a Plan Year as Employee contributions in accordance with the
provisions of this subsection. Any Excess Contributions that are so
recharacterized shall be treated as if the Participant had elected to instead
receive cash Compensation on the earliest date that any Elective Deferral made
on behalf of the Participant during the Plan Year would have been received had
the Participant originally elected to receive such amount in cash and then
contributed such amount as an Employee contribution. To the extent required by
the Internal Revenue Service, however, such recharacterized Excess Contributions
shall continue to be treated as if such amounts were not recharacterized.
<PAGE>
-31-
(2) The Administrator shall report any recharacterized Excess
Contributions as Employee contributions to the Internal Revenue Service and to
the affected Participants at such times and in accordance with such procedures
as are required by the Internal Revenue Service. The Administrator shall take
such other actions regarding the amounts so recharacterized as may be required
by the Internal Revenue Service.
(3) Excess Contributions may not be recharacterized under this
subsection more than two and one-half (2 1/2) months after the close of the Plan
Year to which the recharacterization relates. Recharacterization is deemed to
occur when the Participant is so notified (as required by the Internal Revenue
Service).
(4) The amount of Excess Contributions to be distributed or
recharacterized shall be reduced by excess deferrals previously distributed for
the taxable year ending in the same Plan Year and Excess Deferrals to be
distributed for a taxable year will be reduced by Excess Contributions
previously distributed or recharacterized for the Plan beginning in such taxable
year.
(f) (1) The Administrator may distribute any or all Excess
Contributions for a Plan Year in accordance with the provisions of this
subsection. Such distribution may only occur after the close of such Plan Year
and within twelve (12) months of the close of such Plan Year. In the event of
the termination of the Plan, such distribution shall be made within twelve (12)
months after such termination. Such distribution shall include the income
allocable to the amounts so distributed, as determined under this subsection.
The Administrator may make any special allocations of earnings or losses
necessary to carry out the provisions of this subsection. A distribution of an
Excess Contribution under this subsection may be made without regard to any
notice or consent otherwise required pursuant to sections 411(a)(11) and 417 of
the Code.
<PAGE>
-32-
(2) (A) The income allocable to Excess Contributions
distributed under this subsection shall equal the allocable gain or loss for the
Plan Year. Income includes all earnings and appreciation, including such items
as interest, dividends, rent, royalties, gains from the sale of property,
appreciation in the value of stock, bonds, annuity and life insurance contracts,
and other property, without regard to whether such appreciation has been
realized.
(B) The allocable gain or loss for the Plan Year may be
determined under any reasonable method consistently applied by the
Administrator. Alternatively, the Administrator may, in its discretion,
determine such allocable gain or loss for the Plan Year under the method set
forth in subparagraph (C).
(C) Under this method, the allocable gain or loss for the
Plan Year is determined by multiplying the income for the Plan Year allocable to
Elective Deferrals (and amounts treated as Elective Deferrals) by a fraction,
the numerator of which is the Excess Contributions by the Participant for the
Plan Year and the denominator of which is the total Account balance of the
Participant attributable to Elective Deferrals (and amounts treated as Elective
Deferrals) as of the beginning of the Plan Year, increased by any Elective
Deferrals (and amounts treated as Elective Deferrals) by the Participant for the
Plan Year.
(3) Amounts distributed under this subsection (or other
provisions of this section) shall first be treated as distributions from the
Participant's subaccounts in the following order:
(A) from the Participant's Elective Deferral subaccount (if
such Excess Contribution is attributable to Elective Deferrals);
<PAGE>
-33-
(B) from the Participant's Qualified Nonelective
Contribution subaccount (if such Excess Contribution is attributable to
Qualified Nonelective Contributions); and
(C) from the Participant's Company Contribution subaccount
(if such Excess Contribution is attributable to Company Contributions).
(g) (1) The term "Excess Contribution" shall mean, with respect to a
Plan Year, the excess of the Elective Deferrals (including any Qualified
Nonelective Contributions and Matching Contributions that are treated as
Elective Deferrals under sections 401(k)(2) and 401(k)(3) of the Code) on behalf
of eligible Highly Compensated Employees for the Plan Year over the maximum
amount of such contributions permitted under sections 401(k)(2) and 401(k)(3) of
the Code.
(2) Any distribution of Excess Contributions for a Plan Year
shall be made to Highly Compensated Employees on the basis of the amount of
contributions by, or on behalf of, each such Highly Compensated Employee.
(3) The amount of Excess Contributions to be distributed or
recharacterized shall be reduced by Excess Deferrals previously distributed for
the taxable year ending in the same Plan Year and Excess Deferrals to be
distributed for a taxable year will be reduced by Excess Contributions
previously distributed or recharacterized for the Plan beginning in such taxable
year.
4.10 Correction of Excess Aggregate Contributions.
--------------------------------------------
(a) Excess Aggregate Contributions shall be corrected as provided in
this section. The Administrator may use any method of correction or prevention
provided in this section or any combination thereof, as it determines in its
sole discretion. This
<PAGE>
-34-
section shall be administered and interpreted in accordance with sections 401(k)
and 401(m) of the Code.
(b) The Administrator may refuse to accept any or all prospective
Elective Deferrals to be contributed to a Participant.
(c) (1) The Company may, in its sole discretion, elect to
contribute, as provided in section 4.1(b), a Qualified Nonelective Contribution
in an amount necessary to satisfy any or all of the requirements of section 4.8.
(2) Qualified Nonelective Contributions for a Plan Year shall
only be allocated to the Accounts of Participants who are not Highly Compensated
Employees. Qualified Nonelective Contributions shall be allocated first to the
Participant with the lowest Compensation for that Plan Year and any remaining
Qualified Nonelective contributions thereafter shall be allocated to the
Participant with the next lowest compensation for that Plan Year. This
allocation method shall continue in ascending order of Compensation until all
such Qualified Nonelective Contributions are allocated. The allocation to any
Participant shall not exceed the limits under section 415 of the Code. If two or
more Participants have identical Compensation, the allocations to them shall be
proportional.
(3) Qualified Nonelective Contributions for a Plan Year shall be
contributed to the Trust within twelve (12) months after the close of such Plan
Year.
(4) Qualified Nonelective Contributions shall only be allocated
to Participants who receive Compensation during the Plan Year for which such
contribution is made.
<PAGE>
-35-
(d) The Administrator may, during a Plan Year, distribute to a
Participant (or such Participant's Beneficiary if the Participant is deceased),
any or all Excess Aggregate Contributions allocable to that Participant's
Account for that Plan Year, notwithstanding any contrary provision of the Plan.
Such distribution may include earnings or losses (if any) attributable to such
amounts, as determined by the Administrator.
(e) (1) The Administrator may forfeit any or all Excess Aggregate
Contributions for a Plan Year in accordance with the provisions of this
subsection. The amounts so forfeited shall not include any amounts that are
nonforfeitable under section 6.5.
(2) Any forfeitures under this subsection shall be made in
accordance with the procedures for distributions under subsection (f) except
that such amounts shall be forfeited instead of being distributed.
(f) (1) The Administrator may distribute any or all Excess Aggregate
Contributions for a Plan Year in accordance with the provisions of this
subsection. Such distribution may only occur after the close of such Plan Year
and within twelve (12) months of the close of such Plan Year. Such
distributions shall be specifically designated by the Administrator as a
distribution of Excess Aggregate Contributions. In the event of the complete
termination of the Plan, such distribution shall be made within twelve (12)
months after such termination. Such distribution shall include the income
allocable to the amounts so distributed, as determined under this subsection.
The Administrator may make any special allocations of earnings or losses
necessary to carry out the provisions of this subsection. A distribution of an
Excess Aggregate Contribution under this subsection may be made without regard
to any notice or consent otherwise required pursuant to sections 411(a)(11) and
417 of the Code.
<PAGE>
-36-
(2) (A) The income allocable to Excess Aggregate Contributions
distributed under this subsection shall equal the allocable gain or loss for the
Plan Year. Income includes all earnings and appreciation, including such items
as interest, dividends, rent, royalties, gains from the sale of property,
appreciation in the value of stock, bonds, annuity and life insurance contracts,
and other property, without regard to whether such appreciation has been
realized.
(B) The allocable gain or loss for the Plan Year may be
determined under any reasonable method consistently applied by the
Administrator. Alternatively, the Administrator may, in its discretion,
determine such allocable gain or loss for the Plan Year under the method set
forth in subparagraph (C).
(C) Under this method, the allocable gain or loss for the
Plan Year is determined by multiplying the income for the Plan Year allocable to
employee contributions, matching contributions and amounts treated as matching
contributions by a fraction, the numerator of which is the Excess Aggregate
Contributions for the Participant for the Plan Year and the denominator of which
is the total Account balance of the Participant attributable to employee
contributions, matching contributions and amounts treated as matching
contributions as of the beginning of the Plan Year, increased by the employee
contributions, matching contributions and amounts treated as matching
contributions for the Participant for the Plan Year.
(3) Amounts distributed under this subsection (or other
provisions of this section) shall first be treated as distributions from the
Participant's subaccounts in the following order:
(A) from the Participant's Qualified Nonelective
Contribution subaccount (if such Excess Aggregate Contribution is attributable
to Qualified Nonelective Contributions); and
<PAGE>
-37-
(B) from the Participant's Company Contribution subaccount
(if such Excess Aggregate Contribution is attributable to Company
Contributions).
(g) (1) The term "Excess Aggregate Contribution" shall mean,
with respect to a Plan Year, the excess of the aggregate amount of the matching
contributions and employee contributions (including any Qualified Nonelective
Contributions or elective deferrals taken into account in computing the Actual
Contribution Percentage) actually made on behalf of eligible Highly Compensated
Employees for the Plan Year over the maximum amount of such contributions
permitted under section 401(m)(2)(A) of the Code.
(2) The terms "employee contributions" and "matching
contributions" shall, for purposes of this section, have the meanings set forth
in Treas. Reg. (S)1.401(m)-1(f).
(3) Any distribution of Excess Aggregate Contributions for
a Plan Year shall be made to Highly Compensated Employees on the basis of the
amount of contributions by, or on behalf of, each such Highly Compensated
Employee.
4.11 Correction of Excess Deferrals.
------------------------------
(a) Excess Deferrals shall be corrected as provided in this section.
The Administrator may also prevent anticipated Excess Deferrals as provided in
this section. The Administrator may use any method of correction or prevention
provided in this section or any combination thereof, as it determines in its
sole discretion. A distribution of an Excess Deferral under this section may be
made without regard to any notice or consent otherwise required pursuant to
sections 411(a)(11) and 417 of the Code.
<PAGE>
-38-
This section shall be administered and interpreted in accordance with sections
401(k) and 402(g) of the Code.
(b) The Administrator may refuse to accept any or all prospective
Elective Deferrals to be contributed by a Participant.
(c) (1) The Administrator may distribute any or all Excess Deferrals
to the Participant on whose behalf such Excess Deferrals were made before the
close of the Applicable Taxable Year. Distributions under this subsection
include income allocable to the Excess Distribution so distributed, as
determined under this subsection.
(2) Distribution under this subsection shall only be made if all
the following conditions are satisfied:
(A) the Participant seeking the distribution designates the
distribution as an Excess Deferral;
(B) the distribution is made after the date the Excess
Deferral is received by the Plan; and
(C) the Plan designates the distribution as a distribution
of an Excess Deferral.
(3) The income allocable to the Excess Deferral distributed
under this subsection shall be determined in the same manner as under subsection
(d)(3), except that income shall only be determined for the period from the
beginning of the Applicable Taxable Year to the date on which the distribution
is made.
<PAGE>
-39-
(d) (1) The Administrator may distribute any or all Excess Deferrals
to the Participant on whose behalf such Excess Deferrals were made after the
close of the Applicable Taxable Year. Distribution under this subsection shall
only be made if the Participant timely provides the notice required under
subsection (d)(2) and such distribution is made after the Applicable Taxable
Year and before the first April 15 following the close of the Applicable Taxable
Year. Distributions under this subsection shall include income allocable to the
Excess Deferrals so distributed, as determined under this subsection.
(2) Any Participant seeking a distribution of an Excess Deferral
in accordance with this subsection must notify the Administrator of such request
no later than the first March 15 following the close of the Applicable Taxable
Year. The Administrator may agree to accept notification received after such
date (but before the first April 15 following the close of the Applicable
Taxable Year) if it determines that it would still be administratively
practicable to make such distribution in view of the delayed notification. The
notification required by this subsection shall be deemed made if a Participant's
Elective Deferrals to the Plan in any Plan Year create an Excess Deferral.
(3) The income allocable to the Excess Deferral distributed
under this subsection shall be determined in the same manner as under section
4.9(f)(2), except that the term "Excess Deferrals" shall be substituted for
"Excess Contributions" and the term "Applicable Taxable Year" shall be
substituted for "Plan Year." The Administrator may make any special allocations
of earnings or losses necessary to carry out the provisions of this subsection.
(e) The following terms shall have the meanings specified:
<PAGE>
-40-
(1) Applicable Taxable Year. The taxable year (for federal
-----------------------
income tax purposes) of the Participant in which an Excess Deferral must be
included in gross income (when made) in accordance with section 402(g) of the
Code.
(2) Excess Deferral. A Participant's Elective Deferrals (and
---------------
other contributions limited by section 402(g) of the Code), for an Applicable
Taxable Year that are in excess of the limits imposed by section 402(g) of the
Code for such Applicable Taxable Year.
4.12 Correction of Multiple Use.
--------------------------
(a) If the limitations of Treas. Reg. (S)1.401(m)-2 are exceeded for
any Plan Year, then correction shall be made in accordance with the provisions
of this section. This section shall be administered and interpreted in
accordance with sections 401(k) and 401(m) of the Code.
(b) Any correction required by this section shall be calculated and
administered in accordance with the provisions for correcting Excess
Contributions (in section 4.9), Excess Aggregate Contributions (in section 4.10)
or both, as the Administrator determines in its sole discretion. Any correction
required by this section, to the extent possible, shall be made only with
respect to those Highly Compensated Employees who are eligible in both the
arrangement subject to section 401(k) of the Code and the Plan, as subject to
section 401(m) of the Code.
ARTICLE V
Individual Accounts
-------------------
5.1 Individual Accounts. The Administrator shall establish and maintain
-------------------
an Account in the name of each Participant (and any Beneficiary or other person
entitled to a distribution of retirement benefits from the Trust in accordance
with the Plan) to which
<PAGE>
-41-
there shall be credited or debited the Participant's share of Elective
Deferrals, Rollover Contributions, Qualified Nonelective Contributions,
Qualified Matching Contributions and Employer Contributions; the Participant's
share of the net earnings or net losses on the investments of the assets of the
Trust; distributions from the Participant's Account; and any expenses or
liabilities charged to the Participant's Account. The Account shall contain the
following subaccounts:
(a) a Matching Contribution subaccount to which shall be credited (i)
each such Participant's Matching Contributions made under section 4.1(a); (ii)
the net earnings or net losses attributable to this subaccount from the
investment of the assets of the Trust; (iii) distributions from this subaccount
and (iv) dividends, capital gains distributions and other earnings received on
any shares credited to the Participant's subaccount;
(b) a Qualified Nonelective Contribution subaccount to which shall be
credited (i) each such Participant's Qualified Nonelective Contributions made
under section 4.1(b); (ii) the net earnings or net losses attributable to this
subaccount from the investment of the assets of the Trust; (iii) distributions
from this subaccount and (iv) dividends, capital gains distributions and other
earnings received on any shares credited to the Participant's subaccount;
(c) a Qualified Matching Contribution subaccount to which shall be
credited (i) each such Participant's Qualified Matching Contributions made under
section 4.1(c); (ii) the net earnings or net losses attributable to this
subaccount from the investment of the assets of the Trust; (iii) distributions
from this subaccount and (iv) dividends, capital gains distributions and other
earnings received on any shares credited to the Participant's subaccount;
<PAGE>
-42-
(d) an Elective Deferral subaccount to which shall be credited (i)
each such Participant's Elective Deferrals made under section 4.4; (ii) the net
earnings or net losses attributable to this subaccount from the investment of
the assets of the Trust; (iii) distributions from this subaccount and (iv)
dividends, capital gains distributions and other earnings received on any shares
credited to the Participant's subaccount;
(e) a Rollover Contribution subaccount to which shall be credited (i)
each such Participant's Rollover Contributions made under section 4.5; (ii) the
net earnings or net losses attributable to this subaccount from the investment
of the assets of the Trust; (iii) distributions from this subaccount and (iv)
dividends, capital gains distributions and other earnings received on any shares
credited to the Participant's subaccount; and
(f) such other items as the Administrator deems advisable.
5.2 Allocation of Contributions.
---------------------------
(a) Elective Deferrals. Elective Deferrals made by a Participant
------------------
shall be allocated to each such Participant's Elective Deferral Contribution
subaccount as soon as administrative feasible, but in no event later than the
fifteenth (15/th/) business day of the month following the month in which the
Elective Deferrals would otherwise have been payable to the Participant.
(b) Matching Contributions. Matching Contributions shall be allocated
----------------------
to the Account of each Participant in an amount not to exceed fifty percent
(50%) of each Participant's first six percent (6%) of Compensation contributed
as Elective Deferrals for the Plan Year.
<PAGE>
-43-
(c) A Participant's Rollover Contributions shall be allocated to such
Participant's Rollover Contribution subaccount as of the last day of the
calendar month during which such contributions were received by the Trustees.
(d) Qualified Nonelective Contributions and Qualified Matching
Contributions shall be allocated in accordance with sections 4.9 or 4.10
(whichever is applicable) to each Participant's Qualified Nonelective
Contribution or Qualified Matching Contribution subaccount as of the last day of
the calendar month in which such contribution is made.
5.3 Allocation of Forfeitures. Any forfeiture arising under the Plan for
-------------------------
a given Plan Year shall be considered for allocation purposes as an Employer
Contribution and shall be held, separately invested, and used to reduce future
Employer Contributions.
5.4 Allocation of Earnings.
----------------------
(a) (1) The Administrator, as of each Valuation Date, shall adjust
the amounts credited to the Accounts (including Accounts for persons who are no
longer Employees) so that the total of such Account balances equals the fair
market value of the Trust assets as of such Valuation Date. Except as otherwise
provided herein, any changes in the fair market value of the Trust assets since
the preceding Valuation Date shall be charged or credited to each Account in the
ratio that the balance in each such Account as of the preceding Valuation Date
bears to the balances in all Accounts as of that Valuation Date with appropriate
adjustments to reflect any distributions, allocations or similar adjustments to
such Account or Accounts since that Valuation Date.
(2) To the extent that separate investment funds are established
(as provided in section 5.5), the adjustments required by subsection (a)(1)
shall be made by applying subsection (a)(1) separately for each such investment
fund so that any
<PAGE>
-44-
changes in the net worth of each such investment fund are charged or credited to
the portion of each Account invested in such investment fund in the ratio that
the portion of each such Account invested in such investment fund as of the
preceding Valuation Date (reduced by any distributions made from that portion of
such Account since that Valuation Date) bears to the total amount credited to
such investment funds as of that Valuation Date (reduced by distributions made
from such investment fund since that Valuation Date).
(3) Interim valuations, in accordance with the foregoing
procedure, may be made at such time or times as the Administrator directs.
(b) The Administrator may, in its sole discretion, direct the
Trustees to segregate and separately invest any Trust assets. If any assets are
segregated in this fashion, the earnings or losses on such assets shall be
determined apart from other Trust assets and shall be adjusted on each Valuation
Date, or at such other times as the Administrator deems necessary, in accordance
with this section.
5.5 Investment Direction.
--------------------
(a) The Trustees may, in their discretion, permit Participants, the
Beneficiaries of a deceased Participant and any Alternate Payees to self-direct
the investment of assets credited to the Account of the Participant, Beneficiary
or Alternate Payee. The Trustees shall determine the investment choices to be
made available, which may include designated investment funds, specific
investments or both. The investment choices made available shall be sufficient
to allow compliance with section 404(c) of ERISA.
(b) (1) If the Trustees permit self-directed investments as
described in subsection (a), the Administrator shall establish rules and
procedures that it
<PAGE>
-45-
feels are advisable to implement such an investment program. Such rules and
procedures shall be consistent with section 404(c) of ERISA.
(2) In establishing rules and procedures under subsection
(b)(1), the following shall apply:
(A) Each Participant, Beneficiary or Alternate Payee shall
affirmatively elect to self-direct the investment of assets in his or her
Account, but such election may provide for default investments in the absence
of specific directions from such Participant, Beneficiary or Alternate Payee.
(B) The investment directions of a Participant shall
continue to apply after that Participant's death or incompetence until the
Beneficiary (or, if there is more than one Beneficiary for that Account, all of
the Beneficiaries), guardian or other representatives provide contrary
direction.
(C) The Trustees may decline to implement investment
designations if such investment in the Trustees' judgment:
(i) would result in a prohibited transaction under
section 4975 of the Code;
(ii) would generate income taxable to the Trust;
(iii) would not be in accordance with the Plan and
Trust;
(iv) would cause a fiduciary to maintain the indicia
of ownership of any assets of the Trust outside the jurisdiction of the district
<PAGE>
-46-
courts of the United States other than as permitted by section 404(b) of ERISA
and Labor Reg. (S)2550.404b-1;
(v) would jeopardize the Plan's tax qualified status
under the Code;
(vi) could result in a loss in excess of the amount
credited to the Account; or
(vii) would violate any other requirements of the Code
or ERISA.
(D) The Administrator may establish reasonable restrictions
on the frequency with which investment directions may be given, consistent with
section 404(c) of ERISA.
(E) The Administrator may establish limits on the use of
brokers, investment counsel or other advisors that may be utilized, including
specifying that all investments must be made through a designated broker or
brokers.
(F) The Administrator may establish limits on the types of
investments that are permitted.
ARTICLE VI
Termination of Employment
-------------------------
6.1 Normal Retirement. Upon a Participant's attainment of Normal
-----------------
Retirement Age, the entire amount credited to his or her Account as of the last
preceding or coinciding Valuation Date shall become vested and nonforfeitable.
Subject to section 6.2, the Administrator shall direct the Trustees to
distribute to such Participant the
<PAGE>
-47-
amount credited to such Participant's Account in accordance with the provisions
of ARTICLE VII.
6.2 Late Retirement. If a Participant continues to be an Employee beyond
---------------
Normal Retirement Age, any distribution to such Participant shall be deferred
until the Participant's Termination of Employment. Until such Termination of
Employment, such Participant shall continue to participate on the same basis as
before reaching Normal Retirement Age. Upon Termination of Employment, the
Administrator shall direct the Trustees to distribute to such Participant the
amount credited to such Participant's Account in accordance with the provisions
of ARTICLE VII.
6.3 Disability Retirement.
---------------------
(a) If a Participant is determined to have suffered Total and
Permanent Disability, the entire amount credited to the Participant's Account
shall become vested and nonforfeitable. The Administrator shall direct the
Trustees to distribute to such Participant such vested amounts in accordance
with the provisions of ARTICLE VII.
(b) The Total and Permanent Disability of a Participant shall be
determined by the Administrator, in its sole discretion, in accordance with
uniform principles consistently applied and upon the basis of such evidence as
the Administrator deems necessary and desirable. All determinations of the
Administrator regarding Total and Permanent Disability shall be final,
conclusive and binding on all Participants and other parties.
6.4 Termination Due to Death. Following the death of a Participant,
------------------------
further benefits, if any, shall be payable only as provided under ARTICLE VIII.
<PAGE>
-48-
6.5 Other Termination of Employment.
-------------------------------
(a) Upon a Participant's Termination of Employment for any reason
other than retirement after Normal Retirement Age, death or Total and Permanent
Disability, such Participant shall have a nonforfeitable right to the portion of
his or her Account attributable to Elective Deferrals, Rollover Contributions,
Qualified Nonelective Contributions, and vested Employer Contributions. The
remainder of the Participant's Account, if any, shall be forfeited as of the
close of the Plan Year in which any of the following occurs:
(1) a cash-out distribution is made, as described in Treas. Reg.
(S)1.411(a)-7(d)(4); or
(2) the separated Participant experiences five (5) consecutive
one (1) year Breaks in Service.
(b) Any amounts forfeited shall remain forfeited even if a
Participant is subsequently reemployed and readmitted as a Participant in the
Plan, unless a restoration is made under section 4.6. A Participant who has not
achieved any vesting in Employer Contributions shall be deemed to have received
a distribution of zero dollars at the time of his or her Termination of
Employment.
(c) Unless otherwise specified herein, a Participant's Account
attributable to Employer Contributions shall vest in accordance with such
Participant's Years of Credited Service, determined as follows:
<PAGE>
-49-
Years of
Credited Service Vested Percentage
---------------- -----------------
Fewer than 1 0%
1 but fewer than 2 20%
2 but fewer than 3 40%
3 but fewer than 4 60%
4 but fewer than 5 80%
5 or more 100%
(d) Service performed for a Prior Employer or Affiliated Company
shall be counted as Years of Credited Service for purposes of section 6.5(c) for
Participants who have at least one (1) Hour of Service credited on or after
January 1, 1999.
6.6 Qualified Domestic Relations Orders.
-----------------------------------
(a) Notwithstanding any contrary provision of the Plan, payments
shall be made in accordance with any judgment, decree or order determined to be
a Qualified Domestic Relations Order.
(b) (1) If the Plan receives a Domestic Relations Order, the
Administrator shall promptly notify the Participant and each Alternate Payee of
the receipt of such order and of the Plan's procedures for determining whether
such order is a Qualified Domestic Relations Order. The Administrator shall,
within a reasonable period after receipt of such order, determine whether it is
a Qualified Domestic Relations Order and notify the Participant and each
Alternate Payee of that determination.
(2) During any period in which the issue of whether a Domestic
Relations Order is a Qualified Domestic Relations Order is being determined, the
Administrator shall separately account for the amounts that would have been
payable
<PAGE>
-50-
to the Alternate Payee during such period if the order had been determined to be
a Qualified Domestic Relations Order.
(c) (1) A Domestic Relations Order meets the requirements of this
subsection only if such order clearly specifies the following:
(A) the name and last known mailing address (if any) of the
Participant and the name and mailing address of each Alternate Payee covered by
the order;
(B) the amount or the percentage of the Participant's
benefits to be paid by the Plan to each such Alternate Payee or the manner in
which such amount or percentage is to be determined;
(C) the number of payments or period to which such order
applies; and
(E) each plan to which such order applies.
(2) A Domestic Relations Order meets the requirements of this
subsection only if such order does not:
(A) require the Plan to provide any type or form of benefit
or any option not otherwise provided under the Plan;
(B) require the Plan to provide increased benefits
(determined on the basis of actuarial value); and
<PAGE>
-51-
(C) does not require the payment of benefits to an Alternate
Payee that are required to be paid to another Alternate Payee under another
order previously determined to be a Qualified Domestic Relations Order.
(d) A domestic relations order shall not be treated as failing to
meet the requirements of section 6.6(c)(2)(A) solely because such order requires
that payment of benefits be made to an Alternate Payee:
(1) in the case of any payment before a Participant has
separated from service, on or after the date on which the Participant attains
(or would have attained) the Earliest Retirement Date;
(2) 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 present
value of the benefits actually accrued and not taking into account the present
value of any employer subsidy for early retirement); and
(3) in any form in which such benefits may be paid under the
Plan to the Participant (other than in the form of a qualified joint and
survivor annuity with respect to the Alternate Payee and his or her subsequent
spouse).
(e) A domestic relations order shall not be treated as failing to
meet the requirements of section 6.6(c)(2)(A) solely because such order requires
that payment of benefits be made to an Alternate Payee at a date before the
Participant is entitled to receive a distribution. Such distribution shall be
made to such Alternate Payee notwithstanding any contrary provision of the Plan.
(f) The following terms shall have the meanings specified:
<PAGE>
-52-
(1) 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 benefits under the Plan with respect to such Participant.
(2) Domestic Relations Order. A judgment, decree or order
------------------------
relating to child support, alimony or marital property rights, as defined in
section 414(p)(1)(B) of the Code.
(3) Earliest Retirement Date. The earlier of:
------------------------
(A) the date on which the Participant is entitled to a
distribution under the Plan; or
(B) the later of:
(i) the date the Participant attains age fifty (50);
or
(ii) the earliest date on which the Participant could
begin receiving benefits under the Plan if the Participant separated from
service.
(4) Qualified Domestic Relations Order. A Domestic Relations
----------------------------------
Order that satisfies the requirements of subsection (c) and section 414(p)(1)(A)
of the Code.
(g) If an Alternate Payee entitled to payment under this section is
the spouse or former spouse of a Participant and payment will otherwise be made
in an Eligible Rollover Distribution, then such spouse or former spouse may
elect that all, or
<PAGE>
-53-
portion, of such payment shall instead be transferred as a Direct Rollover. Such
Direct Rollover shall be governed by the requirements of sections 7.3 and 7.4.
(h) If a Domestic Relations Order directs that payment be made to an
Alternate Payee before the Participant's Earliest Retirement Date and such
Domestic Relations Order otherwise qualifies as a Qualified Domestic Relations
Order, then the Domestic Relations Order shall be treated as a Qualified
Domestic Relations Order and such payment shall be made to the Alternate Payee,
even though the Participant is not entitled to receive a distribution under the
Plan because he or she continues to be an Employee of the Employer.
(i) This section shall be interpreted and administered in accordance
with section 414(p) of the Code.
6.7 Lost Beneficiary.
----------------
(a) All Participants and Beneficiaries shall have the obligation to
keep the Administrator informed of their current address until such time as all
benefits due have been paid.
(b) If any amount is payable to a Participant or Beneficiary who
cannot be located to receive such payment, such amount may, at the discretion of
the Administrator, be forfeited; provided, however, that if such Participant or
Beneficiary subsequently claims the forfeited amount, it shall be reinstated and
paid to such Participant or Beneficiary. Such reinstatement may, in the
Administrator's sole discretion, be made from Employer Contributions,
forfeitures or Trust earnings, and shall be treated as a special allocation that
supersedes the normal allocation rules in ARTICLE V.
<PAGE>
-54-
(c) If the Administrator has not, after due diligence, located a
Participant or Beneficiary who is entitled to payment within three (3) years
after the Participant's Termination of Employment, then, at the discretion of
the Administrator, such person may be presumed deceased for purposes of this
Plan. Any such presumption of death shall be final, conclusive and binding on
all parties.
6.8 Offsets. Any transfers or payments made from a Participant's Account
-------
to a person other than the Participant pursuant to the provisions of this Plan
shall reduce the Participant's Account and offset any amounts otherwise due to
such Participant. Such transfers or payments shall not be considered a
forfeiture for purposes of the Plan.
ARTICLE VII
Payment of Benefits
-------------------
7.1 General.
-------
(a) All pension benefits payable under this Plan shall be paid in the
manner and at the times specified in this ARTICLE. Any payments to Participants
or Beneficiaries shall be made in cash except as otherwise provided herein.
Distributions may be made wholly or partly by an in-kind distribution of assets
held by the Trust if the distributee consents to such an in-kind distribution
and the Administrator determines that such an in-kind distribution is not
administratively burdensome.
(b) All payment methods and distributions shall comply with the
requirements of sections 401(a)(4) and 401(a)(9) of the Code and the regulations
thereunder and, if necessary, shall be interpreted to so comply. The provisions
of this ARTICLE apply to all amounts credited to an Account, regardless of the
source of such amounts. All distributions shall be made over a period not to
exceed the life of the Participant receiving the distribution or over the lives
of such Participant and his or her Beneficiary and shall comply with the
incidental death benefit requirement of section
<PAGE>
-55-
401(a)(9)(G) of the Code. Distributions shall comply with the regulations under
section 401(a)(9) of the Code, including Treas. Regs. (S)1.401(a)(9)-2. The
provisions of the Plan reflecting section 401(a)(9) of the Code override any
distribution provisions in the Plan inconsistent with section 401(a)(9).
7.2 Form of Payment. All payments due under the Plan shall be paid in a
---------------
single, lump-sum payment.
7.3 Direct Rollovers.
----------------
(a) A Participant may elect that all or any portion of a distribution
under section 7.2 or section 7.5 that would otherwise be paid as an Eligible
Rollover Distribution shall instead be transferred as a Direct Rollover.
(b) (1) The Administrator shall determine and apply rules and
procedures as it deems reasonable with respect to Direct Rollovers in addition
to, or in lieu of, those set forth in subsection (b)(2). The Administrator may
change such rules and procedures from time to time and shall not be bound by any
previous rules and procedures it has applied.
(2) Unless otherwise determined by the Administrator, the
following rules and procedures shall apply to this section:
(A) A Direct Rollover shall not be permitted when the amount
thereof for the year is expected to be less than two hundred dollars ($200).
(B) A Direct Rollover shall not be permitted to more than
one Eligible Retirement Plan.
<PAGE>
-56-
(c) The following terms shall have the meanings specified:
(1) Direct Rollover. An available distribution that is paid
---------------
directly to an Eligible Retirement Plan for the benefit of the distributee.
(2) Eligible Retirement Plan. An individual retirement account
------------------------
described in section 408(a) of the Code, an individual retirement annuity (other
than an endowment contract) described in section 408(b) of the Code, a qualified
trust described in section 401(a) of the Code if such qualified trust is part of
a defined contribution plan that permits acceptance of Direct Rollovers or an
annuity plan described in section 403(a) of the Code. In the case of a Direct
Rollover for the benefit of the spouse or former spouse of a Participant, the
term "Eligible Retirement Plan" shall only include an individual retirement
account described in section 408(a) of the Code and an individual retirement
annuity (other than an endowment contract) described in section 408(b) of the
Code.
(3) Eligible Rollover Distribution. Any distribution under the
------------------------------
Plan to a Participant, a Participant's spouse or a Participant's former spouse,
except for the following:
(A) Any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made over any one of
the following periods:
(i) the life of the Participant (or the joint lives of
the Participant and the Participant's designated Beneficiary);
<PAGE>
-57-
(ii) the life expectancy of the Participant (or the
joint life and last survivor expectancy of the Participant and the Participant's
designated Beneficiary); or
(iii) a specified period of ten (10) years or more.
(B) Any distribution to the extent the distribution is
required under section 401(a)(9) of the Code.
(C) The portion of any distribution that is not includable in
gross income (determined without regard to the exclusion for net unrealized
appreciation described in section 402(e)(4) of the Code).
(D) Returns of elective deferrals described in Treas. Reg.
(S)1.415-6(b)(6)(iv) that are returned as a result of the limitations under
section 415 of the Code.
(E) Corrective distributions of excess contributions and
excess deferrals under qualified cash or deferred arrangements as described in
Treas. Reg. (S)1.401(k)-1(f)(4) and (S)1.402(g)-1(e)(3), respectively, and
corrective distributions of excess aggregate contributions as described in
Treas. Reg. (S)1.401(m)-1(e)(3), together with the income allocable to these
corrective distributions.
(F) Loans treated as distributions under section 72(p) of
the Code and not excepted by section 72(p)(2) of the Code.
(G) Loans in default that are deemed distributions.
<PAGE>
-58-
(H) Dividends paid on employer securities as described in
section 404(k) of the Code.
(I) The costs of life insurance coverage.
(J) Similar items designated by the Internal Revenue Service
in revenue rulings, notices, and other guidance of general applicability.
7.4 Notice and Payment Elections.
----------------------------
(a) The Administrator shall provide Participants or other distributees
of Eligible Rollover Distributions with a written notice designed to comply with
the requirements of section 402(f) of the Code. Such notice shall be provided
within a reasonable period of time before making an Eligible Rollover
Distribution.
(b) Any elections concerning the form of payment shall be made on a
form prescribed by the Administrator. The Participant or other distributee
shall submit a completed form to the Administrator at least thirty (30) days
before payment is scheduled to commence, unless the Administrator agrees to a
shorter time period. Any election made under this section shall be revocable
until thirty (30) days before payment is scheduled to commence.
(c) An election to have payment made in a Direct Rollover shall only
be valid if the Participant or other distributee provides adequate information
to the Administrator for the implementation of such Direct Rollover and such
reasonable verification as the Administrator may require that the transferee is
an Eligible Retirement Plan.
<PAGE>
-59-
(d) A Participant or other distributee who fails to timely submit an
election in accordance with the requirements of this section after having timely
received the notice required under subsection (a) shall be paid in a single,
lump-sum.
7.5 Mandatory Distributions.
-----------------------
(a) A Participant who has attained age seventy and one-half (70 1/2)
and is required to receive a distribution pursuant to provisions of section
401(a)(9) shall be paid such amounts and at such times as are determined by the
Administrator to be necessary to comply with such requirements. Such payments
shall be made notwithstanding any contrary provisions of the Plan or election
made by such Participant.
(b) A Participant required to receive distributions under subsection
(a) for a year may elect at any time to withdraw additional amounts from his or
her Account. Such election shall be made on a form prescribed by the
Administrator. Distribution shall be made as soon as administratively feasible
after receipt of such election. The Administrator may prescribe additional
rules and procedures to implement this subsection including the establishment of
minimum withdrawal requirements and limits on the frequency of such withdrawals.
7.6 Commencement of Benefits.
------------------------
(a) (1) Except as otherwise provided in this ARTICLE, distribution
to a Participant (or Beneficiary) shall commence within a reasonable period of
time following the Participant's Total and Permanent Disability, death or
Termination of Employment.
(2) If the vested amount in the Participant's Account exceeds or
ever exceeded five thousand dollars ($5,000), then payment to the Participant
shall not
<PAGE>
-60-
commence before such Participant has attained age sixty-two (62), unless the
Participant submits written consent to the Administrator for such earlier
commencement. Such written consent must be obtained not more than ninety (90)
days before the commencement of the distribution.
(b) (1) Distribution shall commence no later than sixty (60) days
after the close of the Plan Year in which the latest of the following occurs:
(A) the Participant attains Normal Retirement Age;
(B) the tenth (10th) anniversary of the year in which the
Participant first became a Participant; or
(C) the Participant ceases to be an Employee.
(2) To the extent required by law, distribution to a Participant
shall commence no later than April 1 of the calendar year following the calendar
year in which the Participant attains age seventy and one-half (70 1/2).
(c) If distribution has not commenced in accordance with the
foregoing requirements because the Participant could not be located, the amount
of benefit cannot be determined or for other similar administrative reasons,
then payment retroactive to the required date shall be made.
7.7 Payments to Incompetents. If a Participant or Beneficiary entitled to
------------------------
receive any benefits hereunder is adjudicated to be legally incapable of giving
valid receipt and discharge for such benefits, the benefits may be paid to the
duly authorized personal representative of such Participant or Beneficiary.
<PAGE>
-61-
7.8 Income Tax Withholding. To the extent required by section 3405 of the
----------------------
Code, distributions and withdrawals from the Plan shall be subject to federal
income tax withholding.
ARTICLE VIII
Distributions to Beneficiaries
------------------------------
8.1 General. Payment of benefits after the death of a Participant (or
-------
Beneficiary receiving benefits) shall be determined and paid to the
Participant's Beneficiary in accordance with this ARTICLE. All amounts credited
to the Account of a Participant who is an Employee on the date of his or her
death shall be nonforfeitable and fully vested. All payments under this ARTICLE
shall be incidental to the retirement benefits otherwise provided for the
Participant and shall be limited in accordance with section 401(a)(9) of the
Code.
8.2 Normal Form of Payment.
----------------------
(a) Any payments due after a Participant's death shall be paid to the
Participant's Beneficiary (or Beneficiaries) in a single, lump-sum.
(b) If a Beneficiary entitled to payment under subsection (a) was the
spouse or former spouse of the deceased Participant and payment will otherwise
be made in an Eligible Rollover Distribution, then such spouse or former spouse
may elect that all, or any portion, of such payment shall instead be transferred
as a Direct Rollover. Such Direct Rollover shall be governed by the
requirements of section 7.3.
8.3 Beneficiary Designation.
-----------------------
(a) A Participant may designate a Beneficiary (including successive
or contingent Beneficiaries) in accordance with this section. Such designation
shall be on a
<PAGE>
-62-
form prescribed by the Administrator, may include successive or contingent
Beneficiaries, shall be effective upon receipt by the Administrator and shall
comply with such additional conditions and requirements as the Administrator
shall prescribe. The interest of any person as Beneficiary shall automatically
cease on his or her death and any further payments from the Plan shall be made
to the next successive or contingent Beneficiary.
(b) A Participant may change his or her Beneficiary designation from
time to time, without the consent or knowledge of any previously designated
Beneficiary, by filing a new Beneficiary designation form with the Administrator
in accordance with subsection (a).
(c) If a Participant dies without a designated Beneficiary surviving,
the Participant's surviving spouse shall be deemed to be such Participant's
Beneficiary, but if the deceased Participant does not have a spouse surviving,
then such Participant's issue, per stirpes, shall be deemed to be such
--- -------
Participant's Beneficiary but if the deceased Participant has neither spouse nor
issue surviving, then such Participant's estate shall be deemed to be such
Participant's Beneficiary.
(d) Notwithstanding the foregoing provisions of this section, if a
Participant is married at the time of his or her death, such Participant shall
be deemed to have designated his or her surviving spouse as Beneficiary, unless
such Participant has filed a Beneficiary designation under subsection (a) and
such spouse consents in writing to the election (acknowledging the effect of the
election and specifically acknowledging the nonspouse Beneficiary) and such
consent is witnessed by either the Administrator (or its delegate) or a notary
public. Such consent shall not be required if the Participant does not have a
spouse or the spouse cannot be located. Such consent shall also not be required
if the Participant is legally separated from his or her spouse or the
Participant has been abandoned (under applicable local law) and the Participant
has a court order to
<PAGE>
-63-
such effect, unless a Qualified Domestic Relations Order provides otherwise. If
the Participant's spouse is legally incompetent to give consent, the spouse's
legal guardian (even if the guardian is the Participant) may give consent.
8.4 Commencement of Payment. Distributions to a Beneficiary shall be made
-----------------------
so as to comply with any applicable requirements of section 401(a)(9). If the
Participant dies before the time when distribution is considered to have
commenced, then any remaining portion of the Participant's interest will be
distributed within five (5) years after the Participant's death. If a
distribution is considered to have commenced before the Participant's death, the
remaining interest will be distributed at least as rapidly as under the method
of distribution being used as of the date of the Participant's death.
ARTICLE IX
Withdrawals and Loans
---------------------
9.1 Withdrawals.
-----------
(a) A Participant may withdraw amounts in his or her Account after
attaining age fifty-nine and one-half (59 1/2). Such withdrawals shall only be
made in accordance with the following procedures:
(1) the Participant shall designate in writing the amount to be
withdrawn;
(2) the withdrawal notice shall be filed with the Administrator
at least thirty (30) days before payment will be made; and
(3) not more than two (2) such withdrawals will be permitted in
any Plan Year.
<PAGE>
-64-
(b) The Administrator may adopt rules providing that not less than a
minimum amount, as determined by the Administrator, may be withdrawn by a
Participant at any one time.
9.2 Hardship Withdrawals.
--------------------
(a) A Participant who has experienced a hardship, as described in
this section, may withdraw amounts from his or her Elective Deferral subaccount
to the extent such amounts do not exceed the total undistributed Elective
Deferrals made by such Participant. Whether a Participant is entitled to a
withdrawal under this section is to be determined by the Administrator in
accordance with nondiscriminatory and objective standards. In order to be
entitled to a hardship withdrawal under this section, a Participant must satisfy
the requirements of both subsection (b) and subsection (c).
(b) (1) A Participant will be deemed to have experienced an
immediate and heavy financial need under the requirements of this subsection if
the withdrawal is for:
(A) medical expenses described in section 213(d) of the
Code incurred by the Participant, the Participant's spouse or any dependents of
the Participant;
(B) the purchase (excluding mortgage payments) of a
principal resident of the Participant;
(C) payment of tuition for the next twelve (12) months of
post-secondary education for the Participant or his or her spouse, children or
dependents; or
<PAGE>
-65-
(D) preventing the eviction of the Participant from his or
her principal residence or the foreclosure on the mortgage of the Participant's
principal residence.
(2) The Administrator may, on the basis of such evidence it
deems relevant, determine that the Participant has experienced an immediate and
heavy financial need for reasons other than those enumerated in this subsection.
(c) (1) A withdrawal under this subsection will be deemed necessary
to satisfy an immediate and heavy financial need of the Participant if it
satisfies the requirements of this subsection. To the extent the amount of the
withdrawal would be in excess of the amount required to relieve the financial
need of the Participant or to the extent such need may be satisfied from other
resources that are reasonably available to the Participant, such withdrawal
shall not satisfy the requirements of this subsection. For purposes of this
subsection, a Participant's resources shall be deemed to include those assets of
his or her spouse or minor children that are reasonably available to the
Participant.
(2) A withdrawal may be treated as necessary to satisfy an
immediate and heavy financial need of the Participant if the Administrator
reasonably relies upon the Participant's representation that the need cannot be
relieved:
(A) through reimbursement or compensation by insurance or
otherwise;
(B) by liquidation of the Participant's assets to the
extent such liquidation would not itself cause an immediate and heavy financial
need;
(C) by cessation of Elective Deferrals under the Plan; or
<PAGE>
-66-
(D) by other distributions or nontaxable (at the time of
the loan) loans from plans maintained by the Employer or by any other employer
or by borrowing from commercial sources on reasonable commercial terms.
(3) A withdrawal will be deemed to satisfy the requirements of
subsection (c) if all of the following requirements are satisfied:
(A) The withdrawal is not in excess of the amount of the
immediate and heavy financial need of the Participant;
(B) The Participant has obtained all distributions, other
than hardship distributions, and all nontaxable loans currently available under
all plans maintained by the Employer;
(C) The Plan and all other plans maintained by the Employer
limits the Participant's Elective Deferrals for the Participant's next taxable
year to the applicable limit under section 402(g) of the Code minus the
Participant's Elective Deferrals for the year of the hardship distribution; and
(D) The Participant is prohibited, under the Plan or by
agreement, from making Elective Deferrals to the Plan and all other plans
maintained by the Employer for at least twelve (12) months after the receipt of
the hardship distribution.
(4) The Administrator shall, on the basis of such evidence it
deems relevant, determine the amount necessary to satisfy an immediate and heavy
financial need of the Participant.
<PAGE>
-67-
(d) Such withdrawals shall only be made in accordance with the
following procedures:
(1) the Participant shall designate in writing the amount
to be withdrawn;
(2) the withdrawal notice shall be filed with the
Administrator at least thirty (30) days before payment will be made (or such
shorter period as the Administrator may agree to); and
(3) not more than one (1) such withdrawal will be permitted
in any calendar quarter.
(e) The Administrator may adopt rules providing that not less
than a minimum amount, as determined by the Administrator may be withdrawn by a
Participant at any one time.
9.3 Loans.
-----
(a) (1) Loans may be made to a Participant or Beneficiary as
provided under the provisions of this section. A Participant or Beneficiary who
is not a party-in-interest (as defined in section 3(14) of ERISA, as amended)
shall not be eligible to receive a loan under this ARTICLE. The Administrator
shall establish the terms of such loans, consistent with the provisions of this
section, and shall make all determinations, such as determinations of default,
that may be appropriate.
(2) The Administrator shall be responsible for the
administration of this loan program, which shall be administered in accordance
with the provisions of this section. The terms and conditions of any loans are
to be determined by
<PAGE>
-68-
the Administrator, in its sole discretion, and may be altered from time to time,
with or without notice, as the Administrator so determines, except that once
made, a loan may not be altered other than in accordance with the express
provisions of the applicable loan agreement.
(b) (1) A Participant or Beneficiary requesting a loan should
contact the Administrator and provide such information as may be required by the
Administrator. The Administrator shall require that a Participant or
Beneficiary who receives a loan execute a written loan agreement, as prescribed
by the Administrator, establishing the terms and conditions of the loan in
accordance with this section. Loan requests that comply with all the
requirements of this section shall be approved.
(2) Loans shall:
(A) be made available on a reasonably equivalent basis;
(B) be provided on a nondiscriminatory basis;
(C) bear a reasonable rate of interest; and
(D) be adequately secured.
(c) (1) The amount of a loan to a Participant or Beneficiary (when
added to the outstanding balance of other loans to that Participant or
Beneficiary from the Plan) shall not exceed the lesser of:
(A) fifty thousand dollars ($50,000), reduced by the excess
of the highest outstanding balance of loans from the Plan to that Participant or
Beneficiary during the one (1) year period ending on the day before the day the
loan is
<PAGE>
-69-
made, over the outstanding balance of loans from the Plan to that Participant or
Beneficiary on the date the loan is made; or
(B) one-half ( 1/2) of the present value of the
Participant's or Beneficiary's nonforfeitable Account balance in the Plan.
(2) For purposes of this subsection, loans from all plans of the
Employer are aggregated.
(3) Loans made under a qualified retirement plan maintained by a
Prior Employer (or any other employer) may be rolled over into this Plan with
the approval of the Plan Administrator.
(d) (1) Loans shall be made on such terms and subject to such
limitations as the Administrator may prescribe in accordance with this section.
(2) Any loan shall, by its terms, require that repayment
(principal and interest) be made in substantially level amortization with
payments, not less frequently than quarterly, over a period not extending beyond
five (5) years from the date of the loan, unless such loan is used to acquire a
dwelling unit that, within a reasonable period of time (determined at the time
the loan is made) will be used as the principal residence of the Participant or
Beneficiary receiving such loan.
(3) The Administrator may, notwithstanding the foregoing
provisions, alter the requirements of this subsection or subsection (c).
(e) The Administrator shall determine, in its sole discretion, the
interest rate for each loan. The interest rate for a given loan shall be set
forth in the loan agreement and may be either a fixed or variable rate.
<PAGE>
-70-
(f) (1) The Administrator shall require such security for a loan as
it deems appropriate. Such security may include the Participant's or
Beneficiary's Account balance, the Participant's or Beneficiary's residence
(through a primary or lesser mortgage interest) or any other property of the
Participant or Beneficiary. The Participant or Beneficiary shall pledge such
property as security for such loan.
(2) Unless a loan is otherwise secured, all of the Participant's
or Beneficiary's right, title, and interest in the Trust shall be security for
the loan. The loan agreement executed by the Participant or Beneficiary shall
provide that, in the event of any default by the Participant or Beneficiary on a
loan repayment, the Administrator shall be authorized (to the extent permitted
by law) to take any and all actions necessary and appropriate to enforce
collection of the unpaid loan, including wage withholding or garnishment from
the Participant's or Beneficiary's employer, in accordance with the loan
agreement.
(3) In the event the value of the Participant's or Beneficiary's
vested Account balance or other collateral at any time is less than one hundred
twenty-five percent (125%) of the outstanding loan balance, the Administrator
may request additional collateral of sufficient value to provide such collateral
amount. Failure to provide such additional collateral upon a request of the
Administrator shall constitute an event of default.
(g) Except to the extent otherwise explicitly provided in the loan
agreement, if a Participant (or Beneficiary) ceases to be a party-in-interest
(as defined in section 3(14) of ERISA, as amended) by reason of a Termination of
Employment or otherwise, or has collateral that fails to satisfy the
requirements of subsection (f)(3) by reason of a Plan distribution or otherwise,
the unpaid balance of the loan shall be immediately due and payable and the
Administrator may deduct the unpaid balance of the
<PAGE>
-71-
loan (including interest) from any payment or distribution from the Trust to
which such Participant or Beneficiary may be entitled. If, after such deduction,
there still remains an unpaid balance of any such loan (including interest),
then the remaining unpaid balance of such loan (including interest) may be
charged against any other property pledged as security with respect to such
loan.
(h) (1) In the event of a default by a Participant or Beneficiary on
a loan repayment, all remaining payments on the loan shall be immediately due
and payable. The Employer shall, upon the direction of the Administrator (to
the extent permitted by law), deduct the total amount of the loan outstanding
and any unpaid interest due thereon from the wages or salaries payable to the
Participant or Beneficiary in accordance with the Participant's or Beneficiary's
loan agreement. In addition, the Administrator may take any other actions
necessary and appropriate to enforce collection of the unpaid loan.
(2) In the event of a default, foreclosure and attachment of any
Account balance pledged as collateral will not occur until a distributable event
occurs in the Plan. Other collateral may, however, be foreclosed upon
immediately following a default.
(3) For purposes of this section, the term "default" shall mean
failure, by a period of at least ten (10) days, to make any loan payment
(whether principal or interest or both) that is due and payable and any other
event specified to be a default under this section. Neither the Administrator
nor any other fiduciary is required to give any written or oral notice of
default.
(i) Unless otherwise established by the Administrator in the
applicable loan agreement, the following additional terms and conditions shall
apply to any loan:
<PAGE>
-72-
(1) Loans shall be repaid through payroll reductions.
(2) Plan amounts attributable to elective deferrals (as defined in
section 402(g)(3) of the Code) shall only be security for loans to the extent
other security is not available.
(3) Interest paid on a loan and repayments of principal shall be
credited to the Account of the Participant who received the loan.
(4) Only two (2) loans may be outstanding at any time, except that if
a Participant has more than two (2) loans outstanding because of a rollover or
transfer of a loan from a Prior Employer's Plan (or any other plan), then such
Participant may not obtain a new loan until the Participant has fewer than two
(2) loans outstanding.
(5) Loans shall only be available if the amount borrowed satisfies
the minimum loan amount requirements, if any, established by the Administrator
(consistent with ERISA and the Code).
ARTICLE X
Contribution and Benefit Limitations
------------------------------------
10.1 Contribution Limits.
-------------------
(a) The Annual Additions that may be allocated to a Participant's
Account for any Limitation Year shall not exceed the lesser of:
(1) thirty thousand dollars ($30,000); or
(2) twenty-five percent (25%) of the Participant's Compensation
for that Limitation Year.
<PAGE>
-73-
(b) If the Employer maintains any other Defined Contribution Plans
then the limitations in subsection (a) shall be computed with reference to the
aggregate Annual Additions for each Participant from all such Defined
Contribution Plans.
(c) If the Annual Additions for a Participant would exceed the limits
specified in this section, then the Annual Additions under this Plan for that
Participant shall be reduced to the extent necessary to prevent such limits from
being exceeded. Such reduction shall be made in accordance with section 10.4.
10.2 Overall Limits.
--------------
(a) If a Participant is participating in both a Defined Contribution
Plan and a Defined Benefit Plan of the Employer, then the sum of the Defined
Contribution Fraction and the Defined Benefit Fraction for any Limitation Year
shall not exceed 1.0.
(b) If the sum of the Defined Contribution Fraction and the Defined
Benefit Fraction would exceed the limits specified in this section, then (unless
the necessary reduction in benefit accruals is mandated under the Defined
Benefit Plan) the Annual Additions under this Plan for that Participant shall be
reduced to the extent necessary to prevent such limits from being exceeded.
(c) The provisions of this section shall only apply to Limitation
Years beginning before January 1, 2000.
10.3 Annual Adjustments to Limits. The dollar limits for Annual Additions
----------------------------
and the dollar limits in the Defined Benefit Fraction and Defined Contribution
Fraction shall be adjusted for cost-of-living to the extent permitted under
section 415 of the Code.
<PAGE>
-74-
10.4 Excess Amounts.
--------------
(a) The foregoing limits shall be limits on the allocation that may
be made to a Participant's Accounts in any Limitation Year. If an excess Annual
Addition would otherwise result from allocation of forfeitures, reasonable
errors in determining Compensation or other comparable reasons, then the
Administrator may take any (or all) of the following steps to prevent the excess
Annual Additions from being allocated:
(1) return any contributions from the Participant, as long as
such return is nondiscriminatory;
(2) hold the excess amounts unallocated in a suspense account
and apply the balance of the suspense account against Employer Contributions for
that Participant made in succeeding years;
(3) hold the excess amounts unallocated in a suspense account
and apply the balance of the suspense account against succeeding year Employer
Contributions;
(4) reallocate the excess amounts to other Participants.
(b) Any suspense account established under this section shall not be
credited with income or loss unless otherwise directed by the Administrator. If
a suspense account under this section is to be applied in a subsequent
Limitation Year, then the amounts in the suspense account shall be applied
before any Annual Additions (other than forfeitures) are made for such
Limitation Year.
<PAGE>
-75-
10.5 Definitions.
-----------
(a) The following terms shall have the meanings specified:
(1) Annual Addition. The sum for any Limitation Year of
---------------
additions (not including Rollover Contributions) to a Participant's Account as a
result of:
(A) Employer Contributions (including Qualified Nonelective
Contributions and Elective Deferrals);
(B) Employee contributions;
(C) forfeitures; and
(D) amounts described in Code sections 415(l)(1) and
419A(d)(2).
(2) Defined Benefit Fraction. A fraction, the numerator of
------------------------
which is the Projected Annual Benefit of the Participant under all Defined
Benefit Plans of the Employer (determined as of the close of the Limitation
Year) and the denominator of which is the Projected Annual Benefit the
Participant would have under such plans (determined as of the close of the
Limitation Year) if such plans provided an annual benefit equal to the lesser
of:
(A) the product of 1.25 multiplied by ninety thousand
dollars ($90,000); or
<PAGE>
-76-
(B) the product of 1.4 multiplied by one hundred percent (100%)
of the Participant's average Compensation for the Participant's three (3)
consecutive Years of Service that produce the highest average Compensation.
(3) Defined Benefit Plan. Any plan qualified under section
--------------------
401(a) of the Code that is not a Defined Contribution Plan.
(4) Defined Contribution Fraction. A fraction, the numerator of
-----------------------------
which is the sum of the Annual Additions to the Participant's Accounts as of the
close of the Limitation Year, and the denominator of which is equal to the sum
of the lesser of the following amounts determined for such Limitation Year and
for each prior Year of Service with the Employer:
(A) the product of 1.25 multiplied by thirty thousand dollars
($30,000); or
(B) the product of 1.4 multiplied by twenty-five percent (25%)
of the Participant's Compensation.
(5) Defined Contribution Plan. A plan qualified under section 401(a)
-------------------------
of the Code that provides an individual account for each Participant and
benefits based solely on the amount contributed to the Participant's account,
plus any income, expenses, gains and losses, and forfeitures of other
Participants which may be allocated to such Participant's account.
(6) Limitation Year. The Plan Year, until the Company adopts a
---------------
different Limitation Year.
<PAGE>
-77-
(7) Projected Annual Benefit. The annual benefit to which a
------------------------
Participant would be entitled, assuming:
(A) the Participant continues in employment until Normal
Retirement Age under the Plan;
(B) the Participant's Compensation for the Limitation Year
remains the same until such Normal Retirement Age; and
(C) all other relevant factors under the Plan for the
Limitation Year will remain constant.
(b) For purposes of this ARTICLE, the term "Compensation" shall mean
all of the wages as defined in section 3401(a) of the Code (for purposes of
income tax withholding at the source), but determined without regard to any
rules that limit the remuneration included in wages based on the nature or
location of the employment or the services performed. This definition shall be
interpreted in a manner consistent with the requirements of section 415 of the
Code. Compensation shall also include salary reduction amounts under section
125 cafeteria plans and section 401(k), 403(b) and 457 plans.
ARTICLE XI
Top-Heavy Rules
---------------
11.1 General. This ARTICLE shall only be applicable if the Plan becomes a
-------
Top-Heavy Plan under section 416 of the Code. If the Plan does not become a
Top-Heavy Plan, then none of the provisions of this ARTICLE shall be operative.
The provisions of this ARTICLE shall be interpreted and applied in a manner
consistent with the requirements of section 416 of the Code and the regulations
thereunder.
<PAGE>
-78-
11.2 Vesting.
-------
(a) If the Plan becomes a Top-Heavy Plan, then amounts in a
Participant's Account attributable to Employer Contributions shall be vested in
accordance with this section, in lieu of section 6.5, to the extent this section
produces a greater degree of vesting. This section shall only apply to
Participants who have at least an Hour of Service after the Plan becomes a Top-
Heavy Plan.
(b) If applicable, amounts in a Participant's Account attributable to
Employer Contributions shall vest as follows:
Years of
Top Heavy Service Vested Percentage
----------------- -----------------
Fewer than 1 0%
1 but less than 2 20%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
5 or more 100%
(c) If the Plan ceases to be a Top-Heavy Plan, then subsection (b)
shall no longer be applicable; provided, however, that in no event shall the
vested percentage of any Participant be reduced by reason of the Plan ceasing to
be a Top-Heavy Plan. Subsection (b) shall nevertheless continue to apply for
any Participant who was previously covered by it and who has at least three (3)
Years of Top-Heavy Service.
11.3 Minimum Contribution.
--------------------
(a) For each Plan Year that the Plan is a Top-Heavy Plan, the
Employer shall make an Employer Contribution to be allocated directly to the
Account of each Non-Key Employee as set forth in this section and ARTICLE V.
<PAGE>
-79-
(b) The amount of the Employer Contribution (and forfeitures)
required to be contributed and allocated for a Plan Year by this section is
three percent (3%) of the Top-Heavy Compensation for that Plan Year of each Non-
Key Employee who is both a Participant and an Employee on the last day of the
Plan Year for which the Employer Contribution is made, with adjustments as
provided herein. If the Employer Contribution allocated to the Accounts of each
Key Employee for a Plan Year is less than three percent (3%) of his or her Top-
Heavy Compensation, then the Employer Contribution required by the preceding
sentence shall be reduced for that Plan Year to the same percentage of Top-Heavy
Compensation that was allocated to the Account of the Key Employee whose Account
received the greatest allocation of Employer Contributions for that Plan Year,
when computed as a percentage of Top-Heavy Compensation.
(c) The contribution required by this section shall be reduced for a
Plan Year to the extent of any Employer Contributions made and allocated under
this Plan or any other contributions from the Employer made and allocated under
this or any other Aggregated Plans. Elective Deferrals shall be treated as if
they were Employer Contributions for purposes of determining any minimum
contributions required under subsection (b).
11.4 Definitions.
-----------
(a) The following terms shall have the meanings specified herein:
<PAGE>
-80-
(1) Aggregated Plans.
----------------
(A) The Plan, any plan that is part of a "required
aggregation group" and any plan that is part of a "permissive aggregation group"
that the Employer treats as an Aggregated Plan.
(B) The "required aggregation group" consists of each plan
of the Employer in which a Key Employee participates (in the Plan Year
containing the Determination Date or any of the four (4) preceding Plan Years)
and each other plan of the Employer which enables any plan of the Employer in
which a Key Employee participates to meet the requirements of section 401(a)(4)
or section 410(b) of the Code. Also included in the required aggregation group
shall be any terminated plan that covered a Key Employee and was maintained
within the five (5) year period ending on the Determination Date.
(C) The "permissive aggregation group" consists of any plan
not included in the "required aggregation group" if the Aggregated Plan
described in subparagraph (A) above would continue to meet the requirements of
section 401(a)(4) and 410 of the Code with such additional plan being taken into
account.
(2) Determination Date. The last day of the preceding Plan
------------------
Year, or, in the case of the first plan year of any plan, the last day of such
plan year. The computations made on the Determination Date shall utilize
information from the immediately preceding Valuation Date.
<PAGE>
-81-
(3) Key Employee.
------------
(A) An Employee (or former Employee) who, at any time during
the Plan Year containing the Determination Date or any of the four (4) preceding
Plan Years, is:
(i) An officer of the Employer with annual Top-Heavy
Compensation for the Plan Year greater than fifty percent (50%) of the amount in
effect under section 415(c)(1)(A) of the Code for the calendar year in which
that Plan Year ends;
(ii) one of the ten (10) Employees owning (or
considered as owning under section 318 of the Code) the largest interest in the
Employer, who has more than one-half of one percent (.5%) interest in the
Employer, and who has annual Top-Heavy Compensation for the Plan Year at least
equal to the maximum dollar limitation under section 415(c)(1)(A) of the Code
for the calendar year in which that Plan Year ends;
(iii) a five percent (5%) or greater shareholder in
the Employer; or
(iv) a one percent (1%) shareholder in the Employer
with annual Top-Heavy Compensation from the Employer of more than one hundred
fifty thousand dollars ($150,000).
(B) For purposes of paragraphs (3)(A)(iii) and (3)(A)(iv),
the rules of section 414(b), (c) and (m) of the Code shall not apply.
Beneficiaries of an Employee shall acquire the character of such Employee and
inherited benefits will retain the character of the benefits of the Employee who
performed services.
<PAGE>
-82-
(4) Non-Key Employee. Any Employee who is not a Key Employee.
----------------
(5) Super Top-Heavy Plan. A Top-Heavy Plan in which the sum of
--------------------
the present value of the cumulative accrued benefits and accounts for Key
Employees exceeds ninety percent (90%) of the comparable sum determined for all
Employees. The foregoing determination shall be made in the same manner as the
determination of a Top-Heavy Plan under this section.
(6) Top-Heavy Compensation. The term Top-Heavy Compensation shall
----------------------
have the same meaning as the term Compensation has under section 10.5(b).
(7) Top-Heavy Plan. The Plan is a Top-Heavy Plan for a Plan Year
--------------
if, as of the Determination Date for that Plan Year, the sum of (i) the present
value of the cumulative accrued benefits for Key Employees under all Defined
Benefit Plans that are Aggregated Plans and (ii) the aggregate of the accounts
of Key Employees under all Defined Contribution Plans that are Aggregated Plans
exceeds sixty percent (60%) of the comparable sum determined for all Employees.
(8) Years of Top-Heavy Service. The number of Years of Service
--------------------------
with the Employer that might be counted under section 411(a) of the Code,
disregarding all service that may be disregarded under section 411(a)(4) of the
Code. Such service shall be computed by reference to each Participant's Vesting
Computation Periods.
(b) The definitions in this section and the provisions of this ARTICLE
shall be interpreted in a manner consistent with section 416 of the Code.
<PAGE>
-83-
11.5 Special Rules.
-------------
(a) For purposes of determining the present value of the cumulative
accrued benefit for any Participant or the amount of the Account of any
Participant, such present value or amount shall be increased by the aggregate
distributions made with respect to such Participant under the Plan during the
Plan Year that includes the Determination Date and the four (4) preceding Plan
Years (if such amounts would otherwise have been omitted).
(b) (1) In the case of unrelated rollovers and transfers, (i) the
plan making the distribution or transfer is to count the distribution as a
distribution under section 416(g)(3) of the Code, and (ii) the plan accepting
the rollover or transfer is not to consider the rollover or transfer as part of
the accrued benefit if such rollover or transfer was accepted after December 31,
1983, but is to consider it as part of the accrued benefit if such rollover or
transfer was accepted before January 1, 1984. For this purpose, rollovers and
transfers are to be considered unrelated if they are both initiated by the
Employee and made from a plan maintained by one employer to a plan maintained by
another employer.
(2) In the case of related rollovers and transfers, the plan
making the distribution or transfer is not to count the distribution or transfer
under section 416(g)(3) of the Code, and the plan accepting the rollover or
transfer counts the rollover or transfer in the present value of the accrued
benefits. For this purpose, rollovers and transfers are to be considered related
if they are not unrelated under subsection (b)(1).
(c) If any individual is a Non-Key Employee with respect to any plan
for any Plan Year, but such individual was a Key Employee with respect to such
plan for
<PAGE>
-84-
any prior Plan Year, any accrued benefit for such Employee (and the account of
such Employee) shall not be taken into account.
(d) Beneficiaries of Key Employees and former Key Employees are
considered to be Key Employees and Beneficiaries of Non-Key Employees and former
Non-Key Employees are considered to be Non-Key Employees.
(e) The accrued benefit of an Employee who has not performed any
service for the Employer maintaining the Plan at any time during the five (5)
year period ending on the Determination Date is excluded from the calculation to
determine top-heaviness. However, if an Employee performs no services, such
Employee's total accrued benefit is included in the calculation for top-
heaviness.
11.6 Adjustment of Limitations.
-------------------------
(a) If this section is applicable, then the contribution and benefit
limitations in section 10.5 shall be reduced. Such reduction shall be made by
modifying section 10.5(a)(2)(A) of the definition of Defined Benefit Fraction to
instead be "(A) the product of 1.0 multiplied by ninety thousand dollars
($90,000), or" and by modifying section 10.5(a)(4)(A) of the definition of
Defined Contribution Fraction to instead be "(A) the product of 1.0 multiplied
by thirty thousand dollars ($30,000), or".
(b) This section shall be applicable for any Plan Year in which
either:
(1) the Plan is a Super Top-Heavy Plan, or
(2) the Plan both is a Top-Heavy Plan (but not a Super Top-Heavy
Plan) and provides Employer Contributions (and forfeitures) to the Account of
any
<PAGE>
-85-
Non-Key Employee in an amount less than four percent (4%) of such Participant's
Top-Heavy Compensation, as determined in accordance with section 11.3(b).
ARTICLE XII
Administration of the Plan
--------------------------
12.1 Committee as Administrator. The committee appointed in this section
--------------------------
shall be the Administrator of the Plan. The name of the committee shall be the
Retirement Committee, shall be appointed by the Board and shall consist of at
least two (2) but not more than five (5) individuals. Members of the committee
shall continue to serve until their death, resignation or removal. The committee
and its members shall be the named fiduciaries of the Plan. If at any time any
of the positions on the committee shall be vacant, the Board may make such
interim appointments to the committee as in its judgment shall be necessary to
ensure effective administration of the Plan. The Board may at any time, without
advance notice and for any reason, remove a member of the committee by written
notice to such member.
12.2 Procedures.
----------
(a) All resolutions or other actions taken by the Retirement Committee
at a meeting shall be by the affirmative vote of a majority of those present at
the meeting. More than half of the members must be present to constitute a
quorum for a meeting. Any two members of the Retirement Committee may sign any
document or instrument requiring the signature of the committee or otherwise act
on behalf of the committee, unless otherwise directed by the committee.
(b) The Retirement Committee shall establish such procedures and rules
of conduct as it shall deem advisable.
<PAGE>
-86-
12.3 Bond and Compensation. The members of the Retirement Committee shall
---------------------
serve without bond, except as otherwise required by law, and without
compensation for their services as such.
12.4 Duties of the Committee. The Retirement Committee shall undertake all
-----------------------
duties assigned to it under the Plan and shall undertake all actions, express or
implied, necessary for the proper administration of the Plan. The
Administrator's duties and responsibilities include, but are not limited to, the
following:
(a) adopting and enforcing such rules and regulations that it deems
necessary or appropriate for the administration of the Plan in accordance with
applicable law;
(b) interpreting the Plan, with its good faith interpretation thereof
to be final and conclusive on any Employee, former Employee, Participant, former
Participant, Beneficiary or other party;
(c) deciding, in its discretion, all questions concerning the Plan,
including questions of fact and law and the eligibility of any person to
participate in the Plan;
(d) computing the amounts to be distributed to any Participant, former
Participant or Beneficiary in accordance with the provisions of the Plan,
determining the person or persons to whom such amounts will be distributed and
determining when such amounts will be distributed;
(e) authorizing the payment of distributions;
<PAGE>
-87-
(f) keeping such records and submitting such filings, election,
applications, returns or other documents or forms as may be required under the
Code and applicable regulations under ERISA, or under other federal, state or
local law and regulations; and
(g) appointing such agents, counsel, accountants and consultants as
may be required to assist in administering the Plan.
12.5 Allocation and Delegation of Responsibilities.
---------------------------------------------
(a) The members of the Retirement Committee (and any other named
Fiduciaries) may allocate any duties and responsibilities under the Plan and
Trust among themselves in any mutually agreed upon manner. Such allocation shall
be in a written document, signed by all members of the Retirement Committee (and
any other named Fiduciaries), which shall specifically set forth this allocation
of duties and responsibilities.
(b) Except as otherwise provided in ERISA, the Retirement Committee
may delegate its duties and responsibilities under the Plan and Trust. The
persons to whom such delegation may be made shall include, but are not limited
to, professional administrators, investment managers, investment advisers and
custodians.
(c) Notwithstanding the foregoing provisions of this section, any
responsibilities to manage or control Plan assets (other than the power to
appoint an investment manager) assigned to the Trustees by the Trust shall not
be allocated or delegated to anyone other than the Trustees.
12.6 Committee Accounts. The Retirement Committee shall maintain accounts
------------------
showing the fiscal transactions of the Plan.
<PAGE>
-88-
12.7 Company to Furnish Information. To enable the Retirement Committee
------------------------------
to perform its functions, the Company shall supply full and timely information
to the committee on all matters relating to the pay of all Participants, their
retirement, death or other cause of Termination of Employment, and such other
pertinent facts as the Retirement Committee may require.
12.8 Expenses. All expenses of Plan administration and operation,
--------
including the fees of any agents or counsel employed and including any expenses
attributable to a termination of the Plan or Trust, shall be paid by the
Company. Any expenses that the Company fails to pay, including any expenses
attributable to a termination of the Plan and Trust, shall be charged to the
Trust. All investment related expenses, including transactional fees and similar
charges charged by brokerage houses, will be paid by the Company and then
charged directly against the Accounts of Participants from whom such expenses
were incurred.
12.9 Indemnification. The Company hereby agrees to indemnify each and
---------------
every individual Trustee, member of the Retirement Committee or Employee acting
on behalf of the committee or Trustees for any expenses or liabilities (other
than those due to willful misconduct) actually incurred in the performance of
their duties under the Plan and Trust.
12.10 Reports. The Retirement Committee shall be responsible for filing
-------
all forms, reports and documents required by law and for providing all necessary
notices to Employees and Beneficiaries, including those respecting the adoption
and qualification of the Plan.
<PAGE>
-89-
ARTICLE XIII
Claims Procedure
----------------
13.1 Claims Submission.
-----------------
(a) All claims for benefits under the Plan by a Participant or
Beneficiary, regardless of the nature of the claim, shall be initially submitted
in writing to the Administrator. Such claims shall be submitted within a
reasonable period of time after the date such benefit was, or was purported to
be, available to the Participant or Beneficiary, with such determination of
reasonableness to be made by the Administrator in its sole discretion. All
claims must adequately state the basis for the claim including a statement of
all pertinent facts and applicable law, except to the extent expressly waived by
the Administrator. The Administrator may prescribe additional procedural
requirements for claims, not inconsistent herewith.
(b) In the event that a Participant or Beneficiary does not receive
any Plan benefit that is claimed, such Participant or Beneficiary shall be
entitled to consideration and review as provided in this ARTICLE. Such
consideration and review shall be conducted in a manner designed to comply with
section 503 of ERISA.
(c) Failure to follow the requirements of this ARTICLE shall result in
the denial of the claim submitted. The Participant or Beneficiary submitting
such deficient claim shall be deemed to have not exhausted his or her
administrative remedies under the Plan.
13.2 Claim Review. Upon receipt of any written claim for benefits, the
------------
Administrator shall be notified and shall give due consideration to the claim
presented. If the claim is denied to any extent by the Administrator, the
Administrator shall furnish the claimant with a written notice setting forth (in
a manner calculated to be understood by the claimant):
<PAGE>
-90-
(a) the specific reason or reasons for denial of the claim;
(b) a specific reference to the Plan provisions on which the denial is
based;
(c) a description of any additional material or information necessary
for the claimant to perfect the claim and an explanation of why such material or
information is necessary; and
(d) an explanation of the provisions of this ARTICLE.
13.3 Right of Appeal. A claimant who has a claim denied under section 13.2
---------------
may appeal to the Administrator for reconsideration of that claim. A request for
reconsideration under this section must be filed by written notice within sixty
(60) days after receipt by the claimant of the notice of denial under section
13.2.
13.4 Review of Appeal. Upon receipt of an appeal the Administrator shall
----------------
promptly take action to give due consideration to the appeal. Such consideration
may include a hearing of the parties involved, if the Administrator feels such a
hearing is necessary. In preparing for this appeal the claimant shall be given
the right to review pertinent documents and the right to submit in writing a
statement of issues and comments. After consideration of the merits of the
appeal, the Administrator shall issue a written decision which shall be binding
on all parties. The decision shall be written in a manner calculated to be
understood by the claimant and shall specifically state its reasons and
pertinent Plan provisions on which it relies. The Trustees' decision shall be
issued within sixty (60) days after the appeal is filed, except that if a
hearing is held, the decision may be issued within one hundred twenty (120) days
after the appeal is filed.
<PAGE>
-91-
13.5 Designation. The Administrator may designate one or more of its
-----------
members or any other person of its choosing to make any determination otherwise
required under this ARTICLE.
ARTICLE XIV
Amendments
----------
14.1 Right to Amend. The Company reserves the right to amend this Plan at
--------------
any time, in whole or in part, before or after a termination of the Plan, by an
instrument in writing executed by the Company. The Company shall furnish the
Administrator and the Trustees with a copy of any amendment adopted within
thirty (30) days after such amendment is adopted or effective, whichever is
later.
14.2 Limitations. An amendment of this Plan shall not:
-----------
(a) reduce any vested right or interest to which any Participant or
Beneficiary is then entitled under this Plan or otherwise reduce the vested
rights of a Participant in violation of section 411(d)(6) of the Code;
(b) vest in the Employer any interest or control over any assets of
the Trust;
(c) cause any assets of the Trust to be used for, or diverted to,
purposes other than for the exclusive benefit of Participants and their
Beneficiaries; or
(d) change any of the rights, duties or powers of the Trustees without
their written consent.
14.3 Amendment to Vesting Schedule. Any amendment that modifies the
-----------------------------
vesting provisions of section 6.5 shall either:
<PAGE>
-92-
(a) provide for a rate of vesting that is at least as rapid for any
Participant as the vesting schedule previously in effect; or
(b) provide that any adversely affected Participant with at least
three (3) Years of Service may elect, in writing, to remain under the vesting
schedule in effect prior to the amendment. Such election must be made within
sixty (60) days after the later of the:
(1) adoption of the amendment;
(2) effective date of the amendment; or
(3) issuance by the Company of written notice of the amendment.
ARTICLE XV
Termination
-----------
15.1 Right to Terminate. The Company may terminate this Plan by an
------------------
instrument in writing executed by the Company. The Company shall furnish the
Administrator and the Trustees with a copy of such written instrument within
thirty (30) days after it is adopted or effective, whichever is later. Neither a
temporary cessation nor the suspension of Employer Contributions shall be deemed
to be a termination of this Plan.
15.2 Full Vesting on Termination. Upon termination of this Plan, or
---------------------------
permanent discontinuance of Employer Contributions hereunder, with or without
written notification, the rights of each Participant to the amounts credited to
that Participant's Account at such time shall be fully vested and
nonforfeitable.
<PAGE>
-93-
15.3 Partial Termination. In the event a partial termination of the Plan
-------------------
is deemed to have occurred, each Participant affected shall be fully vested in
the amounts credited to that Participant's Account with respect to which the
partial termination has occurred. The Trustees shall hold such assets under the
Trust until a distribution is otherwise required (determined without regard to
this section).
15.4 Distribution on Termination.
---------------------------
(a) (1) If the Plan is terminated, or contributions permanently
discontinued, the Employer, at its discretion, may (at that time or at any later
time) direct the Trustees to distribute the amounts in a Participant's Account
in accordance with the distribution provisions of the Plan. If the Plan does not
offer an annuity option, then such distribution shall, notwithstanding any prior
provisions of the Plan, be made in a single lump-sum without the Participant's
consent as to the form or timing of such distribution. If, however, the Employer
maintains another defined contribution plan (other than an employee stock
ownership plan), then the preceding sentence shall not apply and the Employer,
at its discretion, may direct such distributions to be made as a direct transfer
to such other plan without the Participant's consent, if the Participant does
not consent to an immediate distribution.
(2) If the Employer does not direct distribution under paragraph
(1), each Participant's Account shall be maintained until distributed in
accordance with the provisions of the Plan (determined without regard to this
section) as though the Plan had not been terminated or contributions
discontinued.
(b) If the Administrator determines that it is administratively
impracticable to make distributions under this section in cash or that it would
be in the Participant's best interest to make some or all of the distributions
with in-kind property, it
<PAGE>
-94-
shall offer all Participants and Beneficiaries entitled to a distribution under
this section a reasonable opportunity to elect to receive a distribution of the
in-kind property being distributed by the Trust. Those Participants and
Beneficiaries so electing shall receive a proportionate share of such in-kind
property in the form (outright, in trust or in partnership) that the
Administrator determines will provide the most feasible method of distribution.
(c) (1) Amounts attributable to elective contributions shall only be
distributable by reason of this section if one of the following is applicable:
(A) the Plan is terminated without the establishment or
maintenance of another defined contribution plan (other than an employee stock
ownership plan);
(B) the Employer has a sale or other disposition to an
unrelated corporation of substantially all of the assets used by the Employer in
a trade or business of the Employer with respect to an Employee who continues
employment with the corporation acquiring such assets; or
(C) the Employer has a sale or other disposition to an
unrelated entity of the Employer's interest in a subsidiary with respect to an
Employee who continues employment with such subsidiary.
(2) For purposes of this section, the term "elective
contributions" means employer contributions made to the Plan that were subject
to a cash or deferred election under a cash or deferred arrangement.
<PAGE>
-95-
15.5 Affect on Benefits. A termination of the Plan or a permanent
------------------
discontinuance of contributions thereto will not affect the validity of the
Trust or the rights and duties of the Trustees thereunder to pay benefits as
provided in this Plan.
ARTICLE XVI
Miscellaneous
-------------
16.1 IRS Approval. Notwithstanding anything in this instrument to the
------------
contrary, if the Internal Revenue Service shall fail or refuse to issue its
initial determination that the Plan qualifies under section 401(a) of the Code
and the Trust qualifies under section 501(a) of the Code, then the Plan and
Trust, at the election of the Employer, shall be void as of the Effective Date
and all Employer Contributions, Qualified Nonelective Contributions, Qualified
Matching Contributions, Elective Deferrals and Rollover Contributions (including
earnings or losses attributable thereto) shall be returned to the respective
parties making such contributions.
16.2 No Assignment.
-------------
(a) Except as provided herein, the right of any Participant or
Beneficiary to any benefit or to any payment hereunder shall not be subject to
alienation, assignment, garnishment, attachment, execution or levy of any kind.
(b) Subsection (a) shall not apply to any payment or transfer
permitted by the Internal Revenue Service pursuant to regulations issued under
section 401(a)(13) of the Code.
(c) Subsection (a) shall not apply to any payment or transfer pursuant
to a Qualified Domestic Relations Order.
<PAGE>
-96-
(d) Subsection (a) shall not apply to any payment or transfer to the
Trust in accordance with section 401(a)(13)(C) of the Code to satisfy the
Participant's liabilities to the Plan or Trust in any one or more of the
following circumstances:
(1) the Participant is convicted of a crime involving the Plan;
(2) a civil judgment (or consent order or decree) in an action is
brought against the Participant in connection with an ERISA fiduciary violation;
or
(3) the Participant enters into a settlement agreement with the
Department of Labor or the Pension Benefit Guaranty Corporation over an ERISA
fiduciary violation.
16.3 Merger. In the event of a merger, consolidation or transfer of assets
------
or liabilities of this Plan and Trust to any other plan, each Participant or
Beneficiary shall be entitled to receive a benefit immediately after the merger,
consolidation or transfer (as if the Plan were terminated) at least equal to the
benefit that would have been receivable immediately before the merger,
consolidation or transfer (as if the Plan were terminated).
16.4 Governing Law. This Plan shall be governed by, construed and
-------------
administered in accordance with ERISA and any other applicable federal law;
provided, however, that to the extent not preempted by federal law this Plan
shall be governed by, construed and administered under the laws of the State of
Delaware, other than its laws respecting choice of law.
16.5 Construction. The provisions of this Plan shall be interpreted and
------------
construed in accordance with the requirements of the Code and ERISA. Any
amendment or restatement of the Plan or Trust that would otherwise violate the
requirements of section 411(d)(6) of the Code or otherwise cause the Plan or
Trust to cease to be qualified
<PAGE>
-97-
under section 401(a) of the Code shall be deemed to be invalid. Capitalized
terms shall have meanings as defined herein. Singular nouns shall be read as
plural, masculine pronouns shall be read as feminine and vice versa, as
appropriate. References to "section" or "ARTICLE" shall be read as references to
appropriate provisions of this Plan, unless otherwise indicated.
16.6 Company Determinations. Any determinations, actions or decisions of
----------------------
the Company (including but not limited to, Plan amendments and Plan termination)
shall be made by its board of directors in accordance with its established
procedures or by such other individuals, groups or organizations that have been
properly delegated by the board of directors to make such determination or
decision.
16.7 Counterpart Originals. This document may be executed in more than one
---------------------
counterpart original.
16.8 Affect on Employment Rights. Neither the existence of the Plan and
---------------------------
Trust nor the substance of any of their provisions shall have any affect on the
employment rights of any Employee.
IN WITNESS WHEREOF, the Company, on behalf of the Employers, has caused
this Plan to be executed by a duly authorized officer this ____ day of
_________________________, 1999.
Attest: UNITED RENTALS, INC.
By:
_________________________ __________________________________________
Wayland R. Hicks, Chief Operating Officer
<PAGE>
APPENDIX A
Adopting Non-Affiliated Employers
---------------------------------
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
<PAGE>
Amendment #1
United Rentals, Inc. 401(k) Investment Plan
United Rentals, Inc. (the "Company") hereby adopts this Amendment to
the United Rentals, Inc. 401(k) Investment Plan ("Plan") on this 18th day of
April, 2000.
WHEREAS, section 14.1 of the Plan provides the Company with the right to
amend the Plan; and
WHEREAS, the Company wishes to amend the Plan to liberalize the
requirements that employees must meet for entry into participation in the Plan.
NOW, THEREFORE, the Plan is hereby amended, effective May 1, 2000, as
follows:
Section 2.13 of the Plan is amended in its entirety to read as follows:
Employee. Except to the extent otherwise provided herein, any person
---------
employed by an Employer, who is expressly so designated as an Employee on the
books and records of the Employer, and who is treated as such by the Employer
for federal employment tax purposes. Any person who, after the close of a Plan
Year, is retroactively treated by the Employer or any other party as an Employee
for such prior Plan Year shall not, for purposes of the Plan, be considered an
Employee for such prior Plan Year unless expressly so treated as such by the
Employer. The term "Employee" shall only include individuals who have attained
age twenty-one (21).
Section 2.17 of the Plan is amended in its entirety to read as follows:
Entry Dates. The first day following the date an Employee meets the
------------
eligibility requirements.
Section 3.1(a) of the Plan is amended in its entirety to read as follows:
(a) Except as described in subsections (b), (c), (d), (e) and (f) below,
each Employee and any person who subsequently becomes an Employee shall be
entitled to become a Participant on the first day following the Employee's six
(6) month anniversary of his or her Employment Commencement Date and attainment
of age twenty-one (21).
<PAGE>
Section 3.1(d) of the Plan is amended in its entirety to read as follows:
(d) If an Employee who has satisfied the participation requirements fails
to join the Plan and the Employee separates from employment but subsequently
becomes an Employee again, then such Employee shall, on reemployment by the
Employer, be immediately eligible to join the Plan.
Section 3.1(f) of the Plan is amended in its entirety to read as follows:
(f) If an Employee who is eligible to participate in the Plan does not join
the Plan when he or she is first eligible to join, then such Employee may
subsequently join the Plan on any subsequent day provided the Employee completes
and submits a salary reduction form to the Plan Administrator.
IN WITNESS WHEREOF, the Company has caused this Amendment to be executed by
its duly authorized officer on the date first hereinabove set forth, effective
as herein set forth.
Attest: UNITED RENTALS, INC.
_______________________ By: -------------------------------
[name and title]
