<PAGE> 1
As filed with the Securities and Exchange Commission on May 1, 1995
Registration No. 33-_____
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-8
REGISTRATION STATEMENT
under
THE SECURITIES ACT OF 1933
----------------
THE WILLIAMS COMPANIES, INC.
(Exact name of issuer as specified in its charter)
----------------
Delaware 73-0569878
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Williams Center 74172
Tulsa, Oklahoma (Zip Code)
(Address of principal executive offices)
----------------
TEXAS GAS THRIFT PLAN
(Full title of plan)
----------------
DAVID M. HIGBEE, ESQ.
The Williams Companies, Inc.
One Williams Center
Tulsa, OK 74172
(918) 588-2000
(Name, address and telephone number of agent for service)
----------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
============================================================================================================
Proposed Proposed
Maximum Maximum
Title of Amount Offering Aggregate Amount of
Securities to to be Price Offering Registration
be Registered Registered Per Unit(1) Price(2) Fee
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
($1 par value) 1,000,000(3) $30 3/4 $30,750,000 $10,604
============================================================================================================
</TABLE>
(1) Estimated based on the reported New York Stock Exchange composite
transactions closing price on April 19, 1995.
(2) Estimated solely for the purpose of calculating the filing fee.
(3) Includes one-half of a Right issuable under the terms of The Williams
Companies, Inc. Rights Plan for each share of stock.
===============================================================================
<PAGE> 2
PART II
INFORMATION REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents are hereby incorporated by reference and made a
part of this prospectus:
(a) (1) The Williams Companies, Inc. (the "Company" or "Williams"),
Annual Report on Form 10-K for the fiscal year ended December
31, 1994.
(2) The Texas Gas Thrift Plan's (the "Plan") Annual Report on
Form 11-K for the fiscal year ended December 31, 1993.
(b) Williams Current Reports on Form 8-K, dated January 5, 1995,
January 11, 1995, and Form 8-K/A, dated March 29, 1995,
excluding Item 8 of Transco Energy Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1994, which
is incorporated by reference in the Form 8-K/A.
(c) The Company is authorized to issue 240,000,000 shares of
Common Stock, $1.00 par value per share. As of March 24,
1995, 91,028,261 shares of Common Stock were outstanding.
The following description of the shares of Common Stock does
not purport to be complete and is qualified in its entirety
by reference to the pertinent sections of the Company's
Restated Certificate of Incorporation, as amended, which is
incorporated by reference in this Registration Statement.
Holders of Common Stock are entitled to dividends as declared
by the Board of Directors. Certain of the Company's loan
agreements contain provisions restricting the payment of
dividends. Under the most restrictive of such provisions,
the Company had approximately $565 million available at
December 31, 1994, for the payment of dividends. Debt
instruments of certain subsidiaries of the Company limit the
amount of dividend payments to the Company which may
adversely impact the funds available to the Company to pay
dividends on its Common Stock.
Subject to the rights of the holders of any outstanding
shares of Preferred Stock, holders of Common Stock are
entitled to cast one vote for each share held of record on
all matters. Voting securities do not have cumulative voting
rights. This means that the holders of more than 50 percent
of the voting power of all securities outstanding voting for
the election of directors can elect 100 percent of the
directors if they choose to do so; and in such event, the
holders of the remaining voting power will not be able to
elect any person or persons to the Board of Directors.
Stockholders have no preemptive or subscription rights upon
the issuance of additional shares of the Company's stock of
any class or series. Upon liquidation or dissolution of the
Company, whether voluntary or involuntary, the holders of
Common Stock are entitled to share ratably in the assets of
the Company available for distribution after provision for
creditors and holders of preferred stock. All of the issued
and outstanding Common Stock is duly authorized, validly
issued, fully paid and will not be subject to further calls
or assessments.
ANTITAKEOVER PROVISIONS
The provisions of the Company's Restated Certificate of
Incorporation, as amended, summarized in the succeeding
paragraphs may be deemed to have an antitakeover effect and
may delay a tender offer or takeover attempt which a
stockholder might consider in such stockholder's best
interest, including those attempts which might result in a
premium over the market price for the shares held by
stockholders.
<PAGE> 3
The Board of Directors of the Company is divided into three
classes. Members of each class are elected for three-year
terms. Stockholders may only remove any one or all of the
directors for cause and by an affirmative vote of 75 percent
of the voting power of the stock.
The Restated Certificate of Incorporation, as amended,
provides that the approval of 75 percent of the voting power
of the stock is required for the authorization of certain
mergers and sales or leases of substantial parts of the
assets of the Company.
The affirmative vote of 75 percent of the voting power of the
stock is required to amend the provisions of the Restated
Certificate of Incorporation, as amended, referred to in the
preceding two paragraphs.
On January 26, 1986, the Board of Directors of the Company
declared a dividend distribution of 0.5 Right for each
outstanding share of Common Stock. Each Right entitles the
registered holder to purchase from the Company a unit
consisting of one two-hundredth of a share (a "Unit") of
Series A Junior Participating Preferred Stock, par value $1
per share (the "Junior Preferred Stock"), at a price of $75
per Unit, subject to adjustment (the "Purchase Price"). This
description of the Rights is qualified in its entirety by
reference to the Amended and Restated Rights Agreement, dated
as of July 12, 1988, between Williams and First Chicago Trust
Company of New York (the "Rights Agreement") which is
incorporated herein by reference and which is an exhibit to
this Registration Statement.
The Rights attach to all Common Stock certificates
representing outstanding shares. No separate Rights
certificates have been distributed. The Rights will separate
from the Common Stock and a Distribution Date will occur upon
the earliest of (i) ten days following a public announcement
that a person or group of affiliated or associated persons
(an "Acquiring Person") has acquired, or obtained the right
to acquire, beneficial ownership of 20 percent or more of the
outstanding shares of Common Stock (the "Stock Acquisition
Date"), (ii) ten business days following the commencement of
a tender offer or exchange offer that would result in a
person or group beneficially owning 30 percent or more of
such outstanding shares, or (iii) ten business days after the
Board of Directors of the Company determines any person,
alone or together with its affiliates and associates, has
become the beneficial owner of an amount of Common Stock
which the Board of Directors determines to be substantial
(which amount shall in no event be less than 10 percent of
the shares of Common Stock outstanding) and at least a
majority of the Board of Directors who are not officers of
the Company, after reasonable inquiry and investigation,
including consultation with such persons as such directors
shall deem appropriate, shall determine that (a) such
beneficial ownership by such person is intended to cause the
Company to repurchase the Common Stock beneficially owned by
such persons or to cause pressure on the Company to take
action or enter into a transaction or series of transactions
intended to provide such person with short-term financial
gain under circumstances where the Board of Directors
determines that the best long-term interests of the Company
and its stockholders would not be served by taking such
action or entering into such transactions or series of
transactions at that time or (b) such beneficial ownership is
causing or reasonably likely to cause a material adverse
impact (including, but not limited to, impairment of
relationships with customers or impairment of the Company's
ability to maintain its competitive position) on the business
or prospects of the Company (any such person being referred
to herein and in the Rights Agreement as an "Adverse
Person"). Until the Distribution Date, (i) the Rights
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<PAGE> 4
will be evidenced by the Common Stock certificates and will
be transferred with and only with such Common Stock
certificates, (ii) new Common Stock certificates will contain
a notation incorporating the Rights Agreement by reference,
and (iii) the surrender for transfer of any certificates for
Common Stock outstanding will also constitute the transfer of
the Rights associated with the Common Stock represented by
such certificate. As soon as practicable following the
Distribution Date, Rights certificates will be mailed to
holders of record of Common Stock as of the close of business
on the Distribution Date and, thereafter, such separate
Rights certificates alone will evidence the Rights. Except
as otherwise determined by the Board of Directors and as
described in the Rights Agreement, only shares of Common
Stock issued prior to the Distribution Date will be issued
with Rights. Pursuant to the Rights Agreement, the Company
reserves the right to require prior to the occurrence of a
Triggering Event (as defined below) that, upon any exercise
of Rights, a number of Rights be exercised so that only whole
shares of Junior Preferred Stock will be issued.
The Rights are not exercisable until the Distribution Date
and will expire at the close of business on February 6, 1996,
unless earlier redeemed by the Company as described below.
In the event that, at any time following the Distribution
Date, (i) a Person becomes the beneficial owner of more than
20 percent of the then outstanding shares of Common Stock
(except pursuant to an offer for all outstanding shares of
Common Stock which the independent directors determine to be
fair to and otherwise in the best interests of the Company
and its stockholders) or (ii) the Board of Directors
determines that a Person is an Adverse Person, each holder of
a Right will thereafter have the right to receive, upon
exercise, Common Stock (or, in certain circumstances, cash,
property or other securities of the Company) having a value
equal to two times the exercise price of the Right.
Notwithstanding any of the foregoing, following the
occurrence of any of the events set forth in this paragraph,
all Rights that are, or (under certain circumstances
specified in the Rights Agreement) were, beneficially owned
by any Acquiring Person or Adverse Person shall immediately
become null and void. However, Rights are not exercisable
following the occurrence of either of the events set forth
above until such time as the Rights are no longer redeemable
by the Company as set forth below.
In the event that, at any time following the Stock
Acquisition Date, (i) the Company is acquired in a merger or
other business combination transaction in which the Company
is not the surviving corporation (other than a merger which
follows an offer described in the preceding paragraph) or
(ii) 50 percent or more of the Company's assets or earning
power is sold or transferred, each holder of a Right (except
Rights which previously have been voided as set forth above)
shall thereafter have the right to receive, upon exercise,
common stock of the acquiring company having a value equal to
two times the exercise price of the Right. The events set
forth in this paragraph and the preceding paragraph are
referred to as the "Triggering Events."
The Purchase Price payable, and the number of Units of Junior
Preferred Stock or other securities or property issuable,
upon exercise of the Rights are subject to adjustment from
time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or
reclassification of, the Junior Preferred Stock; (ii) if
holders of the Junior Preferred Stock are granted certain
rights or warrants to subscribe for Junior Preferred Stock or
convertible securities at less than the current market price
of the Junior Preferred Stock; or (iii) upon the
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<PAGE> 5
distribution to holders of the Junior Preferred Stock of
evidences of indebtedness or assets (excluding regular
quarterly cash dividends) or of subscription rights or
warrants (other than those referred to above).
With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments amount to at
least 1 percent of the Purchase Price. No fractional Units
will be issued and, in lieu thereof, an adjustment in cash
will be made based on the market price of the Junior
Preferred Stock on the last trading date prior to the date of
exercise.
At any time until ten days following the Stock Acquisition
Date, the Company may redeem the Rights in whole, but not in
part, at a price of $.05 per Right (the "Redemption Price"),
payable in cash, Common Stock or other consideration deemed
appropriate by the Board of Directors. Immediately upon the
action of the Board of Directors of the Company ordering
redemption of the Rights, the Rights will terminate and the
only right of the holders of Rights will be to receive the
Redemption Price.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including,
without limitation, the right to vote or to receive
dividends. While the distribution of the Rights will not be
taxable to stockholders or to the Company, stockholders may,
depending upon the circumstances, recognize taxable income in
the event that the Rights become exercisable for Common Stock
(or other consideration) of the Company or for common stock
of the acquiring company as set forth above.
Other than those provisions relating to the principal
economic terms of the Rights, any of the provisions of the
Rights Agreement may be amended by the Board of Directors of
the Company prior to the Distribution Date. After the
Distribution Date, the provisions of the Rights Agreement may
be amended by the Board in order to cure any ambiguity, to
make changes which do not adversely affect the interests of
holders of Rights (excluding the interests of any Acquiring
Person or Adverse Person), or to shorten or lengthen any time
period under the Rights Agreement; provided, however, that no
amendment to adjust the time period governing redemption
shall be made at such time as the Rights are not redeemable.
Under the Company's Restated Certificate of Incorporation, as
amended, the Company is authorized to issue up to 30,000,000
shares of Preferred Stock, par value $1.00 per share, in one
or more series. The following description of Preferred Stock
sets forth certain general terms and provisions of the series
of Preferred Stock to which any Prospectus Supplement may
relate. Certain other terms of a particular series of
Preferred Stock will be described in the Prospectus
Supplement relating to such series of Preferred Stock. If so
indicated in the Prospectus Supplement relating thereto, the
terms of any such series of Preferred Stock may differ from
the terms set forth below. The description of Preferred
Stock set forth below and the description of the terms of a
particular series of Preferred Stock set forth in the
Prospectus Supplement relating thereto do not purport to be
complete and are qualified in their entirety by reference to
the Restated Certificate of Incorporation, as amended, and to
the certificate of designation relating to that series.
As of March 31, 1995, there were 3,630,100 shares of the
Company's $2.21 Cumulative Preferred Stock outstanding with a
liquidation preference of $25 per share.
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<PAGE> 6
The Preferred Stock will rank senior to the Company's Junior
Preferred Stock as to dividends and amounts payable upon
liquidation.
The rights of the holders of each series of Preferred Stock
will be subordinate to those of the Company's general
creditors.
All reports subsequently filed by Williams pursuant to Sections 13, 14
and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a
post-effective amendment which indicates that all securities offered have been
sold or which deregisters all securities then remaining unsold, shall be deemed
to be incorporated herein by reference and to be a part hereof.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The consolidated financial statements and schedules of the Company
appearing in the Company's Annual Report on Form 10-K for the year ended
December 31, 1994, have been audited by Ernst & Young LLP, independent
auditors, as set forth in their report thereon included therein and
incorporated herein by reference. The financial statements and schedules
referred to above are incorporated herein by reference in reliance upon such
report given upon the authority of such firm as experts in auditing and
accounting.
The financial statements and schedules of the Texas Gas Thrift Plan as
of December 31, 1993 and 1992 and for the years then ended incorporated by
reference in this Registration Statement have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their report with respect
thereto, and are included herein in reliance upon the authority of said firm as
experts in accounting and auditing in giving said report.
The reports of independent auditors relating to the audited consolidated
financial statements and schedules of the Company in any documents filed
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the
date of this Prospectus and prior to the termination of the offering to the
extent covered by consents thereto filed with the Securities and Exchange
Commission will be incorporated by reference in reliance upon the authority of
such independent auditors as experts in auditing and accounting.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is empowered by Section 145 of the General Corporation Law of
the State of Delaware, subject to the procedures and limitations stated
therein, to indemnify any person against expenses (including attorneys' fees),
judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with any threatened, pending or completed
action, suit or proceeding in which such person is made a party by reason of
such person being or having been a director, officer, employee or agent of the
Company. The statute provides that indemnification pursuant to its provisions
is not exclusive of other rights of indemnification to which a person may be
entitled under any by-law, agreement, vote of stockholders or disinterested
directors, or otherwise. The By-laws of the Company provide for
indemnification by the Company of its directors and officers to the fullest
extent permitted by the General Corporation Law of the State of Delaware. In
addition, the Company has entered into indemnity agreements with its directors
and certain officers providing for, among other things, the indemnification of
and the advancing of expenses to such individuals to the fullest extent
permitted by law, and, to the extent insurance is maintained, for the continued
coverage of such individuals.
Policies of insurance are maintained by the Company under which the
directors and officers of the Company are insured, within the limits and
subject to the limitations of the policies, against certain expenses in
connection with the defense of actions, suits or proceedings, and certain
liabilities which might be imposed as a result of such actions, suits or
proceedings, to which they are parties by reason of being or having been such
directors or officers.
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<PAGE> 7
ITEM 8. EXHIBITS.
*(4.1) -- Restated Certificate of Incorporation of Williams
(filed as Exhibit 4(a) to Form 8-B Registration
Statement, filed August 20, 1987).
*(4.2) -- Certificate of Designation with respect to the $2.21
Cumulative Preferred Stock (filed as Exhibit 4.3 to
Form S-3 Registration Statement No. 33-50970, filed
August 19, 1992).
*(4.3) -- Certificate of Increase of Authorized Number of Shares
of Series A Junior Participating Preferred Stock (filed
as Exhibit 3(c) to Form 10-K for the year ended
December 31, 1988).
*(4.4) -- Certificate of Amendment of Restated Certificate of
Incorporation, dated May 20, 1994 (filed as Exhibit
3(d) to Form 10-K for the fiscal year ended December
31, 1994).
*(4.5) -- Form of Certificate of Designation, Preferences and
Rights with respect to the $3.50 Cumulative Convertible
Preferred Stock (filed as a part of Annex A to Form S-4
Registration Statement No. 33-57639, filed February 9,
1995).
*(4.6) -- Amended and Restated Rights Agreement, dated as of July
12, 1988, between Williams and First Chicago Trust
Company of New York (filed as Exhibit 4(c) to Williams
Form 8, dated July 28, 1988).
*(4.7) -- By-laws of Williams (filed as Exhibit 3 to Form 10-Q
for the quarter ended September 30, 1993).
*(4.8) -- Form of Senior Debt Indenture between the Company and
Chemical Bank, Trustee, relating to the 10 1/4%
Debentures, due 2020; the 9 3/8% Debentures, due 2021;
the 8 1/4% Notes, due 1998; Medium- Term Notes
(8.50%-9.31%), due 1996 through 2001; the 7 1/2% Notes,
due 1999, and the 8 7/8% Debentures, due 2012 (filed as
Exhibit 4.1 to Form S-3 Registration Statement No.
33-33294, filed February 2, 1990).
*(4.9) -- U.S. $800,000,000 Credit Agreement, dated as of
February 23, 1995, among Williams and certain of its
subsidiaries and the banks named therein and Citibank,
N.A., as agent (filed as Exhibit 4(b) to Form 10-K for
the year ended December 31, 1994).
(4.10) -- 6% Convertible Subordinated Debenture Due 2005 and
Warrant to Purchase Common Stock issued to Williams
Holdings of Delaware, Inc. on April 15, 1995.
(5.1) -- Opinion and Consent of David M. Higbee, Esq., Secretary
and Counsel for the Company, relating to the validity
of the securities.
(23.1) -- Consent of David M. Higbee (contained in Exhibit 5.1).
(23.2) -- Consent of Ernst & Young LLP.
(23.3) -- Consent of Arthur Andersen LLP.
(24.1) -- Power of Attorney.
(24.2) -- Certified copy of resolution authorizing signatures
pursuant to Power of Attorney.
(99) -- Texas Gas Thrift Plan (9th Amendment)(as of January 1,
1995).
_______________________________
* The exhibits have heretofore been filed with the Securities and Exchange
Commission as part of the filing indicated and are incorporated herein by
reference.
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<PAGE> 8
ITEM 9. UNDERTAKINGS.
(a) Rule 415 offering. Include the following if the securities are
registered pursuant to Rule 415 under the Securities Act:
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this
registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the
registration statement (or the most recent
post-effective amendment thereof) which,
individually or in the aggregate, represent a
fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect
to the plan of distribution not previously
disclosed in the registration statement or any
material change to such information in the
registration statement;
Provided, however, That paragraphs (a)(1)(i) and
(a)(1)(ii) of this Section do not apply if the
registration statement is on Form S-3, Form S-8 or Form
F-3, and the information required to be included in a
post-effective amendment by those paragraphs is contained
in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in the registration
statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective
amendment shall be deemed to be a new registration
statement relating to the securities offered therein, and
the offering of such securities at that time shall be
deemed to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes
of determining any liability under the Securities Act of 1933,
each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee
benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by
reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in the Securities Act of 1933 and is, therefore,
unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the
registrant of expenses incurred or
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<PAGE> 9
paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final
adjudication of such issue.
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<PAGE> 10
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized in the City of Tulsa and State of Oklahoma on the 1st
day of May, 1995.
THE WILLIAMS COMPANIES, INC.
(Registrant)
By s/David M. Higbee
-------------------------------
(David M. Higbee,
Attorney-in-fact)
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on May 1, 1995:
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
* Chairman of the Board, President
- ----------------------------------- and Chief Executive Officer)
Keith E. Bailey (Principal Executive Officer)
* Senior Vice President
- ----------------------------------- (Principal Financial Officer)
Jack D. McCarthy
* Controller
- ----------------------------------- (Principal Accounting Officer)
Gary R. Belitz
* Director
- -----------------------------------
Harold W. Andersen
* Director
- -----------------------------------
Ralph E. Bailey
* Director
- -----------------------------------
Glenn A. Cox
* Director
- -----------------------------------
Thomas H. Cruikshank
* Director
- -----------------------------------
Ervin S. Duggan
* Director
- -----------------------------------
Robert J. LaFortune
* Director
- -----------------------------------
James C. Lewis
</TABLE>
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<PAGE> 11
<TABLE>
<S> <C>
* Director
- -----------------------------------
Jack A. MacAllister
* Director
- -----------------------------------
James A. McClure
* Director
- -----------------------------------
Peter C. Meinig
* Director
- -----------------------------------
Kay A. Orr
* Director
- -----------------------------------
Gordon R. Parker
* Director
- -----------------------------------
Joseph H. Williams
*By s/David M. Higbee
-----------------------------------
(David M. Higbee, Attorney-in-fact)
</TABLE>
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<PAGE> 12
SIGNATURES
The Plan. Pursuant to the requirements of the Securities Act of 1933,
the plan has duly caused this registration statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the city of Tulsa and State
of Oklahoma on the 1st day of May, 1995.
TEXAS GAS THRIFT PLAN
ADMINISTRATIVE COMMITTEE
By /s/ John C. Fischer
---------------------------------
John C. Fischer
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<PAGE> 13
INDEX TO EXHIBITS
*(4.1) -- Restated Certificate of Incorporation of Williams
(filed as Exhibit 4(a) to Form 8-B Registration
Statement, filed August 20, 1987).
*(4.2) -- Certificate of Designation with respect to the $2.21
Cumulative Preferred Stock (filed as Exhibit 4.3 to
Form S-3 Registration Statement No. 33-50970, filed
August 19, 1992).
*(4.3) -- Certificate of Increase of Authorized Number of Shares
of Series A Junior Participating Preferred Stock (filed
as Exhibit 3(c) to Form 10-K for the year ended
December 31, 1988).
*(4.4) -- Certificate of Amendment of Restated Certificate of
Incorporation, dated May 20, 1994 (filed as Exhibit
3(d) to Form 10-K for the fiscal year ended December
31, 1994).
*(4.5) -- Form of Certificate of Designation, Preferences and
Rights with respect to the $3.50 Cumulative Convertible
Preferred Stock (filed as a part of Annex A to Form S-4
Registration Statement No. 33-57639, filed February 9,
1995).
*(4.6) -- Amended and Restated Rights Agreement, dated as of July
12, 1988, between Williams and First Chicago Trust
Company of New York (filed as Exhibit 4(c) to Williams
Form 8, dated July 28, 1988).
*(4.7) -- By-laws of Williams (filed as Exhibit 3 to Form 10-Q
for the quarter ended September 30, 1993).
*(4.8) -- Form of Senior Debt Indenture between the Company and
Chemical Bank, Trustee, relating to the 10 1/4%
Debentures, due 2020; the 9 3/8% Debentures, due 2021;
the 8 1/4% Notes, due 1998; Medium- Term Notes
(8.50%-9.31%), due 1996 through 2001; the 7 1/2% Notes,
due 1999, and the 8 7/8% Debentures, due 2012 (filed as
Exhibit 4.1 to Form S-3 Registration Statement No.
33-33294, filed February 2, 1990).
*(4.9) -- U.S. $800,000,000 Credit Agreement, dated as of
February 23, 1995, among Williams and certain of its
subsidiaries and the banks named therein and Citibank,
N.A., as agent (filed as Exhibit 4(b) to Form 10-K for
the year ended December 31, 1994).
(4.10) -- 6% Convertible Subordinated Debenture Due 2005 and
Warrant to Purchase Common Stock issued to Williams
Holdings of Delaware, Inc. on April 15, 1995.
(5.1) -- Opinion and Consent of David M. Higbee, Esq., Secretary
and Counsel for the Company, relating to the validity
of the securities.
(23.1) -- Consent of David M. Higbee (contained in Exhibit 5.1).
(23.2) -- Consent of Ernst & Young LLP.
(23.3) -- Consent of Arthur Andersen LLP.
(24.1) -- Power of Attorney.
(24.2) -- Certified copy of resolution authorizing signatures
pursuant to Power of Attorney.
(99) -- Texas Gas Thrift Plan (9th Amendment)(as of January 1,
1995).
_______________________________
* The exhibits have heretofore been filed with the Securities and Exchange
Commission as part of the filing indicated and are incorporated herein by
reference.
<PAGE> 1
EXHIBIT 4.10
THE WILLIAMS COMPANIES, INC.
6% CONVERTIBLE SUBORDINATED DEBENTURES DUE 2005
No. 1 $360,000,000 Principal Amount 6% Convertible
Subordinated Debentures Due 2005
The Williams Companies, Inc., a corporation duly organized and
existing under the laws of the State of Delaware (herein called the "Company"),
for value received, hereby promises to pay to Williams Holdings of Delaware,
Inc. ("Williams Holdings"), or registered assigns, the principal sum of THREE
HUNDRED SIXTY MILLION DOLLARS ($360,000,000) on April 15, 2005, in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts, and to pay interest,
semiannually on October 15 and April 15 of each year, commencing October 15,
1995, on said principal sum in like coin or currency, at the rate per annum
specified in the title of this Convertible Subordinated Debenture from April
15, 1995, until payment of said principal sum has been made or duly provided
for; that payment of interest shall be made by check mailed to the address of
Williams Holdings as such address may be indicated to the Company in writing
from time to time.
The indebtedness represented by this Convertible Subordinated
Debenture and the payment of principal of and interest thereon is subordinated
in right of payment to the prior payment in full of senior indebtedness of the
Company.
Reference is made to the further provisions of this Convertible
Subordinated Debenture set forth on the reverse hereof. Such further
provisions shall for all purposes have the same effect as though fully set
forth at this place.
<PAGE> 2
(Reverse Side)
No reference in this Convertible Subordinated Debenture shall alter or
impair the obligation of the Company, which is absolute and unconditional, to
pay the principal of and interest on this Convertible Subordinated Debenture in
the manner, at the respective times, at the rate and in the coin or currency
herein prescribed.
This Convertible Subordinated Debentures may be redeemed, at the
option of the Company, as a whole or from time to time in part, at any time
after April 15, 2000, and prior to maturity, upon the notice referred to below,
at the following redemption prices (expressed in percentages of the principal
amount) together with accrued interest to the date fixed for redemption:
<TABLE>
<CAPTION>
If Redeemed during
the 12-Month Period Percentage of
beginning April 15 Principal Amount
------------------- ----------------
<S> <C>
2000 . . . . . . . . . . . . . . . . . . . . . . 103.0
2001 . . . . . . . . . . . . . . . . . . . . . . 102.4
2002 . . . . . . . . . . . . . . . . . . . . . . 101.8
2003 . . . . . . . . . . . . . . . . . . . . . . 101.2
2004 . . . . . . . . . . . . . . . . . . . . . . 100.6
2005 . . . . . . . . . . . . . . . . . . . . . . 100.0
</TABLE>
Notice of redemption shall be given to Williams Holdings of
Convertible Subordinated Debentures to be redeemed as a whole or in part, by
mailing a notice of such redemption not less than thirty nor more than sixty
days prior to the date fixed for redemption.
Subject to and upon compliance with the terms hereof, at the option of
Williams Holdings, any Convertible Subordinated Debenture may, at any time
prior to the close of business on April 15, 2005, (unless the Convertible
Subordinated Debentures have been called for redemption), be converted into
duly authorized, validly issued, fully paid and nonassessable shares of Common
Stock of the Company, at the rate of 25.9185 shares of Common Stock for each
$1,000 principal amount of Convertible Subordinated Debentures, or, in case an
adjustment in the conversion rate has taken place, at the then applicable
conversion rate as adjusted.
In order to exercise the conversion privilege, Williams Holdings shall
deliver such Convertible Subordinated Debenture to the Company together with
the notice of election to convert set out below.
A conversion into Common Stock shall be deemed to have been effected
immediately prior to the close of business on the day on which such conversion
notice shall have been received by the Company and such Convertible
Subordinated Debenture shall have been delivered as aforesaid, and at such time
the rights of the holder of such Convertible Subordinated Debenture shall
cease, and the
<PAGE> 3
person or persons in whose name or names any certificate or certificates for
shares of Common Stock shall be issuable or deliverable upon conversion shall
be treated for all purposes as the record holder or holders of such Common
Stock at such time; provided, however, that no such delivery on any date when
the stock transfer books of the Company shall be closed shall be effective to
constitute the person or persons entitled to receive shares of Common Stock
upon such conversion as the record holder or holders of such shares of Common
Stock on such date, but such delivery shall be effective to constitute the
person or persons entitled to receive such shares of Common Stock as the record
holder or holders thereof for all purposes on the next succeeding day on which
such stock transfer books are open. As promptly as practicable after the
receipt of such conversion notice and the delivery of such Convertible
Subordinated Debenture as aforesaid, the Company shall cause to be issued and
delivered to Williams Holdings, a certificate or certificates for the number of
duly authorized, validly issued, fully paid and nonassessable full shares of
Common Stock issuable or deliverable upon conversion of such Convertible
Subordinated Debenture. No payment or adjustment shall be made upon any
conversion on account of any interest accrued on the Convertible Subordinated
Debentures surrendered for conversion or on account of any dividends on the
Common Stock issued or delivered upon conversion.
No fractional shares of Common Stock shall be issued or delivered upon
conversions of Convertible Subordinated Debentures. If the conversion of any
Convertible Subordinated Debentures would result in the issuance of a
fractional share, an amount equal to such fraction multiplied by the closing
price of the Common Stock reported as New York Stock Exchange Composite
Transactions (the "Closing Price"), on the date on which conversion becomes
effective shall be paid in cash by the Company which is expressly authorized to
value fractional shares without actual purchase or sale on the basis of such
Closing Price of the Common Stock.
The rate at which Convertible Subordinated Debentures may be converted
into shares of Common Stock, in effect at any time, shall be subject to
adjustment as follows:
(a) In case the Company shall (a) pay or make a dividend
or other distribution on its Common Stock in stock of the Company, (b)
subdivide its outstanding shares of Common Stock, (c) combine the
outstanding shares of its Common Stock into a smaller number of
shares, or (d) issue by reclassification of its Common Stock (whether
pursuant to a merger or consolidation or otherwise) any shares of
stock of the Company, then the holder of any Convertible Subordinated
Debenture shall be entitled to receive, upon the conversion of such
Convertible Subordinated Debenture, the number of shares of stock of
the Company which he would have owned or have been entitled to receive
after the happening of any of the events described above had such
Convertible Subordinated Debenture been converted immediately prior to
the happening of such
<PAGE> 4
event. Such adjustment shall be made whenever any of the events
listed above shall occur. An adjustment made pursuant to this
subsection (a) shall become effective retroactively, as of immediately
after the opening of business on the day following the record date for
the determination of the shareholders entitled to receive such
dividend or other distribution, with respect to conversions made
subsequent to the record date in the case of a dividend or other
distribution, and shall become effective immediately after the opening
of business on the day following the effective date in the case of a
subdivision, combination or reclassification.
(b) In case the Company shall issue rights or warrants to
the holders of its Common Stock as such (other than pursuant to any
dividend reinvestment or similar plan entitling them to subscribe for
or purchase shares of Common Stock at a price per share less than the
current market price per share of the Common Stock (as defined in
subsection (d) below)) on the record date for determination of
shareholders entitled to receive such rights or warrants, then in each
such case the number of shares of Common Stock into which each $1,000
principal amount of Convertible Subordinated Debentures shall
thereafter be convertible shall be determined by multiplying the
number of shares of Common Stock into which such principal amount of
Convertible Subordinated Debentures was theretofore convertible by a
fraction, the numerator of which shall be the number of shares of
Common Stock outstanding on the date of issuance of such rights or
warrants plus the number of additional shares of Common Stock offered
for subscription or purchase, and the denominator of which shall be
the number of shares of Common Stock outstanding on the date of
issuance of such rights or warrants plus the number of shares which
the aggregate offering price of the total number of shares so offered
would purchase at such current market price per share of Common Stock.
For the purposes of this subsection (b), the issuance of rights or
warrants to subscribe for or purchase stock or securities convertible
into shares of Common Stock shall be deemed to be the issuance of
rights or warrants to purchase the shares of Common Stock into which
such stock or securities are convertible at an aggregate offering
price equal to the aggregate offering price of such stock or
securities plus the minimum aggregate amount (if any) payable upon
conversion of such stock or securities into Common Stock. Such
adjustment shall be made whenever any such rights or warrants are
issued, and shall become effective retroactively with respect to
conversions made subsequent to the record date for determination of
shareholders entitled to receive such rights or warrants. For the
purposes of this subsection (b), the number of shares of Common Stock
at any time outstanding shall not include shares held in the treasury
of the Company but shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock.
The Company will not issue any rights or warrants in respect of
<PAGE> 5
shares of Common Stock held in the treasury of the Company except with
respect to any dividend reinvestment or similar plan.
(c) In case the Company shall distribute to holders of
its Common Stock (whether pursuant to a reclassification, merger or
consolidation or otherwise) evidences of its indebtedness or assets,
then in each such case the number of shares of Common Stock into which
each $1,000 principal amount of Convertible Subordinated Debentures
shall thereafter be convertible shall be determined by multiplying the
number of shares of Common Stock into which such principal amount of
Convertible Subordinated Debentures was theretofore convertible by a
fraction, the numerator of which shall be the current market price per
share of the Common Stock (as defined in subsection (d) below) on the
record date for determination of shareholders entitled to receive such
distribution, and the denominator of which shall be such current
market price per share of the Common Stock less the fair value (as
determined by the Board of Directors of the Company, whose
determination shall be conclusive, and described in an officers
certificate) of the portion of the assets or evidences of indebtedness
so distributed or of such subscription rights applicable to one share
of the Common Stock. Such adjustment shall be made whenever any such
distribution is made. An adjustment made pursuant to this subsection
(c) shall become effective retroactively, as of immediately prior to
the opening of business on the day following the record date for the
determination of shareholders entitled to receive such distribution,
with respect to conversions made subsequent to the record date in the
case of a distribution other than pursuant to a reclassification, and
shall become effective immediately prior to the opening of business on
the day following the effective date in the case of a
reclassification.
(d) For the purposes of any computation hereunder, the
current market price per share of Common Stock on any date shall be
deemed to be the average of the daily Closing Prices for the 30
consecutive full trading days commencing 45 full trading days before
the day in question. For the purposes of this subsection (d), the
term "trading day" shall mean each Monday, Tuesday, Wednesday,
Thursday and Friday, other than any day on which securities are not
traded on the principal United States market for the Company's Common
Stock.
(e) No adjustment in the conversion rate shall be
required unless such adjustment (plus any adjustments not previously
made by reason of this subsection (e)) would require an increase or
decrease of at least 1 percent in such rate; provided, however, that
any adjustments which by reason of this subsection (e) are not
required to be made shall be carried forward and taken into account in
any subsequent
<PAGE> 6
adjustment. All calculations hereunder shall be made to the nearest
one-hundred thousandth of a share.
(f) The certificate of any independent firm of public
accountants of recognized standing selected by the Board of Directors
shall be evidence of the correctness of any computation made
hereunder.
(g) Anything hereunder to the contrary notwithstanding,
the Company shall be entitled to make such adjustments in the
conversion rate, in addition to those hereinabove required, as shall
be determined by the Board of Directors to be advisable in order to
avoid taxation so far as practicable of any dividend or distribution
of stock or subdivision, reclassification or combination of stock,
issuance of rights or warrants, or any similar transaction or any
event treated as a distribution of stock or stock rights to its
shareholders for United States federal income tax purposes to the
recipients.
In case of any consolidation or merger of the Company with any other
corporation (regardless of which corporation is the survivor of the merger), as
a result of which holders of Common Stock shall be entitled to receive stock,
cash, securities or property with respect to or in exchange for Common Stock,
or in case of any sale or transfer of all or substantially all of the property
and assets of the Company, the Company (if it is the survivor of the merger),
the corporation formed by such consolidation or with which the Company shall
have been merged or the person which shall have acquired by sale or transfer
such property and assets, as the case may be, shall provide that the holder of
each Convertible Subordinated Debenture then outstanding shall have the right,
during the period such Convertible Subordinated Debenture shall be convertible
as specified herein, to convert such Convertible Subordinated Debenture into
the kind and amount of securities (which may continue to be Common Stock,
depending on the terms of the transaction), cash or property receivable upon
such consolidation, merger, sale or transfer by a holder of the number and kind
of shares of Common Stock of the Company into which such Convertible
Subordinated Debenture might have been converted immediately prior to such
consolidation, merger, sale or transfer.
The Company covenants and agrees that it will at all times have and
keep available out of its Common Stock (whether authorized but unissued shares
reserved by it free from preemptive rights or issued shares which have been
reacquired by it) the number of full shares of Common Stock which shall from
time to time be deliverable upon the conversion of all outstanding Convertible
Subordinated Debentures as provided herein; provided, however, that such number
of shares of Common Stock to be kept available by the Company may be reduced by
the number of shares of Common Stock no longer required as the result of the
redemption of Convertible Subordinated Debentures pursuant to the terms hereof,
computed as
<PAGE> 7
if at the time of computation all outstanding Convertible Subordinated
Debentures were held by a single holder.
The Company shall in good faith and as promptly as possible endeavor
to cause all registrations with, and to obtain any approval by, any
governmental authority under any Federal or state law of the United States of
America that may be required before the shares of Common Stock may be lawfully
issued or transferred and to list the shares of Common Stock required to be
delivered upon conversion of Convertible Subordinated Debentures prior to such
delivery on each United States national securities exchange on which the
outstanding Common Stock is listed at the time of such delivery.
NOTICE OF ELECTION TO CONVERT
The undersigned holder of this certificate hereby irrevocably
exercises the option to convert $________ principal amount of Convertible
Subordinated Debentures evidenced by this certificate into such number of
shares of Common Stock of The Williams Companies, Inc., as provided under the
terms hereof, and directs that the shares deliverable upon the conversion be
registered in the name of and delivered, together with a check in payment for
any fractional share, to the undersigned unless a different name has been
indicated below. If shares are to be registered in the name of a person other
than the undersigned, the undersigned will pay all transfer taxes payable with
respect thereto. If the principal amount of Convertible Subordinated
Debentures indicated above is less than the principal amount of such
Convertible Subordinated Debentures evidenced by this certificate, the
undersigned directs that the Company issue to the undersigned, unless a
different name is indicated below, a new certificate evidencing the balance of
the principal amount of the Convertible Subordinated Debentures not surrendered
hereby.
<PAGE> 8
<TABLE>
<S> <C>
Dated: Fill in for registration of Shares if to be
delivered other than to and in the name of
the Registered Holder:
Name__________________________________________________________
(Please Print Name and Address) _________________________________________________________
Social Security or other Taxpayer Identification Number
Signature_____________________________________________________ Name_____________________________________________________
Address_______________________________________________________ Address__________________________________________________
NOTE: The above signature should correspond exactly
with the name on the face of this Certificate or with the
name of assignee appearing in assignment form below.
The Williams Companies, Inc.
By /s/ Jack D. McCarthy
__________________________
Jack D. McCarthy
Senior Vice President
ATTEST:
/s/ David M. Higbee
__________________________
David M. Higbee
Secretary
</TABLE>
<PAGE> 9
EXHIBIT 4.10
THE WILLIAMS COMPANIES, INC.
WARRANTS TO PURCHASE
Common Stock, $1 par value
VOID AFTER 5:00 P.M., NEW YORK CITY TIME, ON APRIL 15, 2000
No. 1 7,537,147 Warrants
This certifies that Williams Holdings of Delaware, Inc. or assigns
(the "Holder") is the owner of the above indicated number of Warrants, each
Warrant entitling such owner to purchase on April 15, 2000, on or before 5:00
P.M., New York City time (the "Exercise Date"), one share of Common Stock, $1
par value of The Williams Companies, Inc. (the "Company"), such Common Stock
being herein referred to as the "Warrant Securities". The Warrants may be
surrendered by the Holder for Warrant Securities on the Exercise Date upon
payment of $46.67 for each Warrant so surrendered (the "Warrant Price"). The
Holder may exercise the Warrants evidenced hereby by providing certain
information set forth on the back hereof and by paying in full, in lawful money
of the United States of America in immediately available funds the Warrant
Price for each Warrant exercised to the Company and by surrendering this
Warrant Certificate, with the form of election to purchase on the reverse
hereof completed and duly executed, at the corporate offices of the Company at
the address specified on the reverse hereof, and upon compliance with and
subject to the conditions set forth herein.
Any whole number of Warrants evidenced by this Warrant Certificate may
be exercised to purchase Warrant Securities. No fractional Warrant Securities
will be issued.
The Warrant Securities to be issued and delivered upon the exercise of
the Warrants evidenced by this Warrant Certificate will be, when issued, duly
authorized, fully paid and nonassessable shares of the Common Stock of the
Company. The Company covenants and agrees that it will at all times have and
keep available out of its Common Stock (whether authorized but unissued shares
reserved by it free from preemptive rights or issued shares which have been
reacquired by it) the number of full shares of Common Stock which shall be
deliverable upon exercise of the Warrants.
The Company shall in good faith and as promptly as possible endeavor
(i) to cause all registrations with, and to obtain any approval by, any
governmental authority under any Federal or state law of the United States of
America that may be required before the Warrant Securities may be lawfully
issued or transferred and delivered and (ii) to list the Warrant Securities
required to be delivered upon exercise of the Warrants prior to such delivery
on each United States national securities exchange on which the
<PAGE> 10
outstanding Warrant Securities are listed at the time of such delivery.
This Warrant Certificate may be transferred only at the corporate
offices of the Company by the Holder or its assigns, in person or by an
attorney duly authorized in writing.
This Warrant Certificate shall not entitle the Holder hereof to any of
the rights of a holder of the Warrant Securities, including, without
limitation, the right to vote or to receive dividends, if any, declared and
paid on the Warrant Securities.
Dated as of April 15, 1995.
THE WILLIAMS COMPANIES, INC.
[SEAL]
By /s/ Jack D. McCarthy
---------------------------
Jack D. McCarthy
Senior Vice President
Attest:
/s/ David M. Higbee
- -------------------------
David M. Higbee
Secretary
<PAGE> 11
[Reverse of Warrant Certificate]
Instructions for Exercise of Warrant
To exercise the Warrants evidenced hereby, the Holder must pay in full
in lawful money of the United States of America in immediately available funds,
the Warrant Price for Warrants exercised to the Company, One Williams Center,
Tulsa, Oklahoma 74172, Attention: Treasury Department, which payment must
specify the name of the Holder and the number of Warrants exercised by such
Holder. In addition, the Holder must complete the information required below
and present this Warrant Certificate in person or by mail (certified or
registered mail is recommended) to the Company at the address set forth above.
This Warrant Certificate, completed and duly executed, must be received by the
Company within five business days of the payment.
To be Executed Upon Exercise of Warrant
The undersigned hereby irrevocably elects to exercise _____ Warrants,
evidenced by this Warrant Certificate, to purchase shares of the Warrant
Securities and represents that he/she has tendered payment for such Warrant
Securities in lawful money of the United States of America in immediately
available funds to the order of the Company, One Williams Center, Tulsa,
Oklahoma 74172, Attention: Treasury Department, in the amount of __________ in
accordance with the terms hereof. The undersigned requests that said Warrant
Securities be registered in such names and delivered all as specified in
accordance with the instructions set forth below.
Dated__________________ Name_______________________________
(Please Print)
_______________________ Address____________________________
(Insert Social Security
or Other Identifying ____________________________
Number of Holder)
Signature__________________________
<PAGE> 12
Assignment
(Form of Assignment to be Executed if Holder Desires
to Transfer Warrants Evidenced Hereby)
FOR VALUE RECEIVED hereby sells, assigns and
transfers unto
Please insert social security
or other identifying number
_____________________________
_____________________________
________________________________________________________________________________
(Please print name and address including zip code)
________________________________________________________________________________
The Warrants represented by the within Warrant Certificate and does hereby
irrevocably constitute and appoint ____________ Attorney, to transfer said
Warrant Certificate on the books of the Company with full power of substitution
in the premises.
Dated:
_______________________________________
Signature
(Signature must conform in all respects
to name of Holder as specified on the
face of this Warrant Certificate and
must bear a signature guarantee by a
bank, trust company or member broker
of the New York, Midwest or Pacific
Stock Exchanges.)
Signature Guaranteed
__________________________
<PAGE> 1
[THE WILLIAMS COMPANIES, INC. LETTERHEAD]
EXHIBIT 5.1
May 1, 1995
The Williams Companies, Inc.
One Williams Center
Tulsa, OK 74172
Dear Sirs:
The Williams Companies, Inc., a Delaware corporation (the "Company")
contemplates filing a Registration Statement on Form S-8 under the Securities
Act of 1933, as amended (the "Act"), relating to the registration of Common
Stock of the Company, $1.00 par value (the "Common Stock") and associated
preferred stock purchase rights (the "Rights"), to be issued pursuant to the
terms of the Texas Gas Thrift Plan (the "Plan").
As Counsel for the Company, I have examined the corporate proceedings and such
other legal matters as I deem relevant to the authorization and issuance of the
Common Stock and the Rights. Based on such examination, it is my opinion that
when the Common Stock has been issued by the Company pursuant to the terms of
the Plan, the Common Stock and the Rights will be legally issued, fully paid
and nonassessable.
I hereby consent to the filing of this opinion with the Securities and Exchange
Commission as Exhibit 5.1 to the Registration Statement.
Very truly yours,
/s/David M. Higbee
David M. Higbee
DMH/cf
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Interests of Named
Experts and Counsel" in the Registration Statement (Form S-8) pertaining to the
Texas Gas Thrift Plan and to the incorporation by reference therein of our
report dated February 10, 1995, with respect to the consolidated financial
statements and schedules of The Williams Companies, Inc. included in its Annual
Report (Form 10-K) for the year ended December 31, 1994, filed with the
Securities and Exchange Commission.
ERNST & YOUNG LLP
Tulsa, Oklahoma
May 1, 1995
<PAGE> 1
EXHIBIT 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-8 of our report dated June
27, 1994 included in the Texas Gas Thrift Plan Form 11-K for the year ended
December 31, 1993, and to all references to our Firm included in this
Registration Statement.
ARTHUR ANDERSEN LLP
Houston, Texas
April 28, 1995
<PAGE> 1
EXHIBIT 24.1
THE WILLIAMS COMPANIES, INC.
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS that each of the undersigned
individuals, in their capacity as a director or officer, or both, as
hereinafter set forth below their signature, of THE WILLIAMS COMPANIES, INC., a
Delaware corporation ("Williams"), does hereby constitute and appoint J. FURMAN
LEWIS, BOBBY E. POTTS and DAVID M. HIGBEE their true and lawful attorneys and
each of them (with full power to act without the others) their true and lawful
attorneys for them and in their name and in their capacity as a director or
officer, or both, of Williams, as hereinafter set forth below their signature,
to sign a registration statement on Form S-8 for the registration under the
Securities Act of 1933, as amended, of Common Stock of Williams issuable
pursuant to the terms and provisions of the Texas Gas Thrift Plan, together
with associated Preferred Stock purchase rights and Plan interests, and any and
all amendments and post-effective amendments to said registration statement and
any and all instruments necessary or incidental in connection therewith; and
THAT the undersigned Williams does hereby constitute and
appoint J. FURMAN LEWIS, BOBBY E. POTTS and DAVID M. HIGBEE its true and lawful
attorneys and each of them (with full power to act without the others) its true
and lawful attorney for it and in its name and on its behalf to sign said
registration statement and any and all amendments and post-effective amendments
thereto and any and all instruments necessary or incidental in connection
therewith.
Each of said attorneys shall have full power of substitution
and resubstitution, and said attorneys or any of them or any substitute
appointed by any of them hereunder shall have full power and authority to do
and perform in the name and on behalf of each of the undersigned, in any and
all capacities, every act whatsoever requisite or necessary to be done in the
premises, as fully to all intents and purposes as each of the undersigned might
or could do in person, the undersigned hereby ratifying and approving the acts
of said attorneys or any of them or of any such substitute pursuant hereto.
IN WITNESS WHEREOF, the undersigned have executed this
instrument, all as of the 16th day of March, 1995.
/s/ Keith E. Bailey /s/ Jack D. McCarthy
- --------------------------------- ------------------------------
Keith E. Bailey Jack D. McCarthy
Chairman of the Board, President Senior Vice President
and Chief Executive Officer (Principal Financial Officer)
(Principal Executive Officer)
/s/ Gary R. Belitz
------------------------------
Gary R. Belitz
Controller
(Principal Accounting Officer)
<PAGE> 2
Page 2
/s/ Harold W. Andersen /s/ Ralph E. Bailey
- ------------------------------ -------------------------------
Harold W. Andersen Ralph E. Bailey
Director Director
/s/ Glenn A. Cox /s/ Thomas H. Cruikshank
- ------------------------------ -------------------------------
Glenn A. Cox Thomas H. Cruikshank
Director Director
/s/ Ervin S. Duggan /s/ Robert J. LaFortune
- ------------------------------ -------------------------------
Ervin S. Duggan Robert J. LaFortune
Director Director
/s/ James C. Lewis /s/ Jack A. MacAllister
- ------------------------------ -------------------------------
James C. Lewis Jack A. MacAllister
Director Director
/s/ James A. McClure /s/ Peter C. Meinig
- ------------------------------ -------------------------------
James A. McClure Peter C. Meinig
Director Director
/s/ Kay A. Orr /s/ Gordon R. Parker
- ------------------------------ -------------------------------
Kay A. Orr Gordon R. Parker
Director Director
/s/ Joseph H. Williams
--------------------------------
Joseph H. Williams
Director
THE WILLIAMS COMPANIES, INC.
By /s/ J. Furman Lewis
---------------------------
J. Furman Lewis
ATTEST: Senior Vice President
/s/ David M. Higbee
- -------------------------
David M. Higbee
Secretary
<PAGE> 1
EXHIBIT 24.2
[THE WILLIAMS COMPANIES, INC. LOGO]
I, the undersigned, DAVID M. HIGBEE, Secretary of THE WILLIAMS
COMPANIES, INC., a Delaware company (hereinafter called the "Company"), do
hereby certify that at a meeting of the Board of Directors of the Company, duly
convened and held on March 16, 1995, at which a quorum of said Board was
present and acting throughout, the following resolution was duly adopted:
RESOLVED that the form of power of attorney submitted
to this meeting for use in connection with the execution and
filing for and on behalf of the Company of the Registration
Statement referred to in the immediately preceding resolution
and any amendments or supplements thereto is hereby approved
and the Chairman of the Board, the President or any Vice
President of the Company be, and hereby is, authorized to
execute said power of attorney in the form so presented by,
for and on behalf of the Company.
I further certify that the foregoing resolution has not been
modified, revoked or rescinded and is in full force and effect.
IN WITNESS WHEREOF, I have hereunto set my hand and affixed
the seal of THE WILLIAMS COMPANIES, INC., this 1st day of May, 1995.
/s/ David M. Higbee
--------------------------
David M. Higbee
Secretary
(CORPORATE SEAL)
<PAGE> 1
EXHIBIT 99
TEXAS GAS THRIFT PLAN
(9TH AMENDMENT)
(AS OF JANUARY 1, 1995)
<PAGE> 2
INDEX
<TABLE>
<CAPTION>
SECTION PAGE
- ------- ----
<S> <C> <C>
SECTION I: INTRODUCTION
1.1 Purpose Of The Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1
1.2 Exclusive Benefit Of Participants . . . . . . . . . . . . . . . . . . . . . I-1
1.3 Rights Under The Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1
1.4 Plan A Voluntary Undertaking By Employer . . . . . . . . . . . . . . . . . . I-1
1.5 Effect Of Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-2
SECTION II: DEFINITION AND CONSTRUCTION OF TERMS
2.1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1
2.2 Construction Of Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . II-5
SECTION III: PLAN ADMINISTRATION
3.1 Thrift Plan Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1
3.2 Chairman, Secretary and Subcommittees . . . . . . . . . . . . . . . . . . . III-1
3.3 Meetings and Majority Vote . . . . . . . . . . . . . . . . . . . . . . . . . III-2
3.4 No Bond Required Or Compensation To Be Paid . . . . . . . . . . . . . . . . III-2
3.5 General Powers And Duties . . . . . . . . . . . . . . . . . . . . . . . . . III-2
3.6 Appointment And Allocation . . . . . . . . . . . . . . . . . . . . . . . . . III-3
3.7 Determinations By Committee . . . . . . . . . . . . . . . . . . . . . . . . III-3
3.8 Maintenance Of Accounts And Reports . . . . . . . . . . . . . . . . . . . . III-4
3.9 Information To Be Furnished . . . . . . . . . . . . . . . . . . . . . . . . III-4
3.10 Reliance On Data And Opinions . . . . . . . . . . . . . . . . . . . . . . . III-5
3.11 Action Non-Discriminatory . . . . . . . . . . . . . . . . . . . . . . . . . III-5
3.12 Liability Of And Indemnity To Members . . . . . . . . . . . . . . . . . . . III-5
3.13 Investment Manager . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-6
SECTION IV: ELIGIBILITY AND PARTICIPATION
4.1 Present Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.2 New Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.3 Application For Participation . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.4 Late Commencement Of Participation . . . . . . . . . . . . . . . . . . . . . IV-1
4.5 Change In Employment Status . . . . . . . . . . . . . . . . . . . . . . . . IV-1
4.6 Reemployment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-2
</TABLE>
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<PAGE> 3
<TABLE>
<CAPTION>
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SECTION V: PARTICIPANT CONTRIBUTIONS
5.1 Participant Contributions . . . . . . . . . . . . . . . . . . . . . . . . . V-1
5.2 Change In Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . V-1
5.3 Involuntary Suspension Of Participant
Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2
5.4 Rights During Suspension . . . . . . . . . . . . . . . . . . . . . . . . . . V-2
5.5 Correction Of Errors in Contributions . . . . . . . . . . . . . . . . . . . V-2
5.6 Rollover Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . V-3
5.7 Affiliate Plan Transfers . . . . . . . . . . . . . . . . . . . . . . . . . . V-3
SECTION VI: EMPLOYER MATCHING CONTRIBUTIONS,
PLAN EXPENSES AND ESOP DIVIDENDS
6.1 Amount Of Matching Contributions . . . . . . . . . . . . . . . . . . . . . . VI-1
6.2 Payment Of Employer Contributions . . . . . . . . . . . . . . . . . . . . . VI-2
6.3 Correction Of Errors In Contributions . . . . . . . . . . . . . . . . . . . VI-2
6.4 Contributions By Affiliated Employer . . . . . . . . . . . . . . . . . . . . VI-2
6.5 Expenses Of Plan And Trust . . . . . . . . . . . . . . . . . . . . . . . . . VI-3
6.6 ESOP Share Dividends . . . . . . . . . . . . . . . . . . . . . . . . . . . . VI-3
SECTION VII: MANAGEMENT OF PARTICIPANT ACCOUNTS
7.1 Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-1
7.2 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-1
7.3 Trust Assets For Exclusive Benefit
Of Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VII-1
SECTION VIII: INVESTMENT PROVISIONS
8.1 Initial Investment Of Accounts . . . . . . . . . . . . . . . . . . . . . . . VIII-1
8.2 Change In Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . VIII-1
8.3 ESOP Diversification Election . . . . . . . . . . . . . . . . . . . . . . . VIII-2
8.4 Voting Of Company Stock . . . . . . . . . . . . . . . . . . . . . . . . . . VIII-3
8.5 Tender And Exchange Offers . . . . . . . . . . . . . . . . . . . . . . . . . VIII-3
8.6 Put Option . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VIII-6
8.7 Independent Appraiser . . . . . . . . . . . . . . . . . . . . . . . . . . . VIII-8
SECTION IX: TYPES OF ACCOUNTS
9.1 After-Tax Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.2 401(k) Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.3 Rollover Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.4 Company Match-Cash Accounts . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.5 Company Match-Stock Accounts . . . . . . . . . . . . . . . . . . . . . . . . IX-1
9.6 Old Company Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
9.7 Account Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . IX-2
</TABLE>
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<PAGE> 4
<TABLE>
<CAPTION>
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SECTION X: ALLOCATIONS AND ACCOUNT BALANCES
10.1 Allocation Of Participant Contributions . . . . . . . . . . . . . . . . . . X-1
10.2 Allocation Of Matching Contributions . . . . . . . . . . . . . . . . . . . . X-1
10.3 Calculation Of Account Balances . . . . . . . . . . . . . . . . . . . . . . X-1
SECTION XI: LIMITS ON BENEFITS
11.1 Applicability Of Restrictions . . . . . . . . . . . . . . . . . . . . . . . XI-1
11.2 Special Definitions Applicable To
Section XI . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XI-1
11.3 Defined Contribution Limit . . . . . . . . . . . . . . . . . . . . . . . . . XI-1
11.4 Limitation For Two Types of Plans . . . . . . . . . . . . . . . . . . . . . XI-3
11.5 Special Rules For Plans Subject To Overall
Limitations Under Code Section 415(e) . . . . . . . . . . . . . . . . . . XI-4
11.6 Reallocation Of Excess Contributions . . . . . . . . . . . . . . . . . . . . XI-4
SECTION XII: VESTING OF ACCOUNTS
12.1 All Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XII-1
SECTION XIII: DISTRIBUTIONS, WITHDRAWALS,
FORFEITURES AND LOANS
13.1 Termination Of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-1
13.2 401(k) Account - Age 59 1/2 Withdrawals . . . . . . . . . . . . . . . . . . XIII-2
13.3 After-Tax Account, Old Company Account and
Rollover Account Withdrawals . . . . . . . . . . . . . . . . . . . . . . . XIII-2
13.4 Hardship Withdrawals . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-2
13.5 Loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-5
13.6 Investment Fund Withdrawal Order . . . . . . . . . . . . . . . . . . . . . . XIII-8
13.7 Direct Rollover Distributions . . . . . . . . . . . . . . . . . . . . . . . XIII-8
13.8 30-Day Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIII-9
SECTION XIV: PROVISIONS CONCERNING PAYMENT OF BENEFITS
14.1 Medium Of Withdrawals/Distributions . . . . . . . . . . . . . . . . . . . . XIV-1
14.2 Time Of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIV-1
14.3 Designation Of Beneficiaries . . . . . . . . . . . . . . . . . . . . . . . . XIV-2
SECTION XV: SPECIAL PAYMENT PROVISIONS
15.1 Payments To Minors And Incompetents . . . . . . . . . . . . . . . . . . . . XV-1
15.2 Non-Assignability Of Rights . . . . . . . . . . . . . . . . . . . . . . . . XV-1
</TABLE>
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<TABLE>
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SECTION XVI: ASSOCIATED COMPANIES
16.1 Adoption Of Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-1
16.2 Withdrawal From Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-1
16.3 Termination Of Employer Participation
By Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVI-2
SECTION XVII: AMENDMENT AND TERMINATION
17.1 Right To Amend Or Terminate . . . . . . . . . . . . . . . . . . . . . . . . XVII-1
17.2 Restrictions On Amendment . . . . . . . . . . . . . . . . . . . . . . . . . XVII-2
17.3 Effect Of Dissolution Or Merger . . . . . . . . . . . . . . . . . . . . . . XVII-2
17.4 Effect Of Merger, Consolidation Or
Transfer Of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVII-3
17.5 Expiration Of Trust Term . . . . . . . . . . . . . . . . . . . . . . . . . . XVII-3
17.6 Distribution Upon Termination of Plan . . . . . . . . . . . . . . . . . . . XVII-3
17.7 Consent For Alternate Forms Of Benefit . . . . . . . . . . . . . . . . . . . XVII-3
SECTION XVIII: TOP-HEAVY RULES
18.1 Top-Heavy Provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-1
18.2 Determination Of Whether The Plan
Is Top-Heavy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-1
18.3 If The Plan Is Top-Heavy . . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-2
18.4 Super Top-Heavy Provisions . . . . . . . . . . . . . . . . . . . . . . . . . XVIII-3
SECTION XIX: ANTIDISCRIMINATION TESTS
19.1 Special Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-1
19.2 401(k) Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-4
19.3 Actual Deferral Percentage . . . . . . . . . . . . . . . . . . . . . . . . . XIX-6
19.4 Actual Deferral Percentage Test . . . . . . . . . . . . . . . . . . . . . . XIX-6
19.5 Adjustments As A Result Of Actual
Deferral Percentage Test . . . . . . . . . . . . . . . . . . . . . . . . . XIX-8
19.6 Maximum Average Contribution Percentage . . . . . . . . . . . . . . . . . . XIX-8
19.7 Adjustments For Excessive Contribution
Percentage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XIX-9
SECTION XX: GENERAL PROVISIONS
20.1 Employer's Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-1
20.2 Notice of Address . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-1
20.3 Copies Of Plan Available . . . . . . . . . . . . . . . . . . . . . . . . . . XX-1
20.4 Titles And Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-1
20.5 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-1
20.6 Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-2
20.7 Unclaimed Benefits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . XX-2
</TABLE>
(iv)
<PAGE> 6
TEXAS GAS THRIFT PLAN
The Texas Gas Thrift Plan (the "Plan") was established
effective as of August 1, 1962, and has been amended and restated various times
since its establishment. The Plan is hereby amended and restated effective
January 1, 1995, to provide for an ESOP feature and a 401(k) feature in the
same plan. The terms, provisions and conditions of the Plan, as hereby amended
and restated, are as follows:
SECTION I
INTRODUCTION
1.1 Purpose of the Plan. It is the purpose of this Plan to
promote and encourage employees to provide additional security and income for
their future through a systematic savings program.
1.2 Exclusive Benefit of Participants. This Plan has been
adopted for the exclusive benefit of the Participants and their Beneficiaries.
So far as possible, this Plan shall be interpreted in a manner consistent with
this intent and with the intention of the Company that this Plan shall satisfy
those provisions of ERISA and the Code relating to a qualified plan with a
Section 401(k) feature and an ESOP feature. In this regard, the separate ESOP
part of the Plan shall be disaggregated and tested separately for all testing
requirements of the Code and shall be administered and reported in accordance
with such disaggregation.
1.3 Rights Under the Plan. The establishment and maintenance of
this Plan shall not be considered as giving any Employee or any other person
any legal or equitable right as against any Employer, the Committee or the
Trustee, or in the assets of the Trust, except and to the extent that such
right is specifically provided for in this Plan.
I-1
<PAGE> 7
1.4 Plan a Voluntary Undertaking by Employer. Except to the
extent participation in the Plan has been an item of good faith bargaining with
a collective bargaining unit, this Plan is strictly a voluntary undertaking on
the part of each Employer and shall not be deemed or construed to constitute a
contract between any Employer and any Employee or other person or to be a
consideration for or inducement to, or a condition of, the employment of any
Employee. Nothing contained in this Plan shall be deemed to give any Employee
the right to be retained in the service of any Employer or interfere in any way
with the right of any Employer to discharge any Employee at any time.
1.5 Effect of Amendment. The Plan is hereby amended and
completely restated as set forth herein and all rights and benefits under the
Plan shall hereafter be determined under the terms and provisions hereof;
however, the amendment and restatement of the Plan hereby shall not operate or
be construed to deprive any Participant of any protected benefit, within the
meaning of Code Section 411(d)(6) and the regulations thereunder, he may have
had under the Plan as in effect immediately prior to this amendment. Further,
this amendment and restatement shall not operate or be construed to confer on,
or provide to, any former Participant whose employment terminated for any
reason prior to the effective date hereof, any additional rights other than
those to which he was entitled under the Plan as in effect at the time his
employment terminated, except as otherwise specifically provided herein or
required by law.
I-2
<PAGE> 8
SECTION II
DEFINITION AND CONSTRUCTION OF TERMS
2.1 Definitions. In addition to the special definitions in
Section XIX, for purposes of the Plan, the following words and phrases shall,
whenever used herein, have the meanings stated below unless a different meaning
is clearly required by the context:
(a) Account means an Old Company Account, a 401(k)
Account, an After-Tax Account, a Rollover Account, a Company
Match-Cash Account, and a Company Match-Stock Account, as applicable.
(b) Affiliate means any corporation which is a member
of a "controlled group" of corporations with an Employer or any trade
or business (including a partnership) under "common control" or a
member of an "affiliated service group" with any Employer determined
under Code Sections 414(b), (c) and (m), respectively, and any other
entity required to be aggregated with the Employer pursuant to
regulations under Code Section 414(o). For purposes of Section XI,
such determinations shall be made in accordance with Code Section
415(h).
(c) After-Tax Account means an Account described in
Section 9.1.
(d) After-Tax Contribution means an after-tax
contribution made by the Participant pursuant to Section 5.1.
(e) Associated Company means an Affiliate which has
been designated by the Board as eligible to adopt and participate in
the Plan on and after the date such Affiliate has adopted the Plan.
II-1
<PAGE> 9
(f) Beneficiary means the person designated by a
Participant or the Plan pursuant to Section 14.3 to receive any
benefits payable upon his death.
(g) Board means the Board of Directors of the Company.
(h) Code means the Federal Internal Revenue Code of
1986, as amended from time to time, and any subsequently adopted
Federal Internal Revenue Code. References in the Plan to sections of
the Code shall include corresponding sections in any subsequently
adopted Federal Internal Revenue Code.
(i) Committee means the Thrift Plan Committee appointed
pursuant to Section III.
(j) Company means Texas Gas Transmission Corporation.
(k) Company Match-Cash Account means an Account
described in Section 9.4.
(l) Company Match-Stock Account means an Account
described in Section 9.5.
(m) Company Stock means the common stock of the Transco
Energy Company; provided, however, effective upon the consummation of
the Merger (as defined in Section 6.1), Company Stock shall mean the
common stock of The Williams Companies, Inc.
(n) Company Stock Fund means the fund offered under the
Plan, as provided in Attachment A, in which Participants can direct
the investment of their Accounts to purchase Company Stock.
(o) Compensation means, with respect to a Participant
for any specified payroll period, the regular basic wage or salary
payable to such Participant that period, including any amounts
excluded from his gross income pursuant to a salary reduction election
pursuant to Code Sections 125 or 402, but excluding all other items of
compensation, including, without
II-2
<PAGE> 10
limitation (1) bonuses, (2) commissions, (3) awards, (4) military
leave pay, (5) premium, auxiliary or other special pay, (6) overtime
pay for work performed in excess of the basic 40-hour work-week, (7)
increased wages or salary resulting from temporary promotion,
upgrading or transfer, of whatever duration, to a higher paid job or
classification, (8) severance pay, and (9) contributions by any
Employer under this or any other employee benefit plan except as
expressly provided to the contrary above.
In no event, however, shall the compensation of a
Participant considered for Plan purposes for any Plan Year beginning
on or after January 1, 1994, exceed $150,000, as adjusted by Code
Section 401(a)(17). For purposes of the foregoing, compensation
received after the Code Section 401(a)(17) dollar limit has been
reached for a Plan Year shall be disregarded under the Plan.
Compensation shall be determined under the rules of Code Section
414(q)(6), except that the term "family" shall include only the spouse
of the Participant and any lineal descendant under the age of 19 as of
the close of the Plan Year. Further, for any Plan Year that contains
fewer than 12 calendar months, the annual compensation limit for such
short Plan Year shall be limited to the Code Section 401(a)(17) dollar
limit for the calendar year in which such Plan Year begins multiplied
by the ratio obtained by dividing the number of full calendar months
in the Plan Year by 12.
(p) Current Balance means the amount credited to an
Account as of a Valuation Date determined in accordance with the
provisions of Section 10.3.
(q) Earnings means, with respect to an Employer, the
current and/or accumulated earnings of such Employer as shown
II-3
<PAGE> 11
by its books and accounts for general corporate purposes in accordance
with generally accepted accounting principles.
(r) Eligible Class means an Employee of an Employer who:
(1) is not a member of or represented by a
collective bargaining unit, unless the
collective bargaining agreement for such
unit requires inclusion of its members in
the Plan;
(2) is not a non-resident alien; and
(3) is not a "leased employee" within the
meaning of Code Section 414(n).
(s) Employee means any individual who is employed as an
"employee", as defined in Code Section 3121(d), by an Employer or
Affiliate, and shall also include a "leased employee" unless Code
Section 414(n)(5) applies or regulations provide otherwise.
(t) Employers means the Company and each Associated
Company which has adopted and is participating in the Plan pursuant to
Section 16.1.
(u) Entry Date means, with respect to an Employee, the
first day the Employee completes an Hour of Service in the Eligible
Class and the first day of each payroll period thereafter and such
other date or dates as the Committee may from time to time designate.
(v) ERISA means Public Law No. 93-406, the Employee
Retirement Income Security Act of 1974, as amended from time to time.
(w) 401(k) Account means an Account described in
Section 9.2
(x) 401(k) Contribution means a salary reduction
(before-tax) contribution made by the Participant pursuant to
II-4
<PAGE> 12
Section 5.1 and deemed to be an Employer contribution in accordance
with Code Section 401(k).
(y) Hour of Service means an hour for which an Employee
is paid, or entitled to payment, by an Employer or Affiliate during a
Plan Year for the performance of duties.
(z) Leave of Absence means a temporary absence from
service due to sickness, accident, military service, or any other
temporary absence authorized by the Employer and in accordance with
the Employer's established Leave of Absence policy, which shall be
applied in a uniform and nondiscriminatory manner.
(aa) Old Company Account means an Account described in
Section 9.6.
(bb) Participant means an Employee who has qualified
under and has become a Participant in the Plan, including a former
Employee who continues to have an Account under the Plan.
(cc) Plan means the "Texas Gas Thrift Plan" as set forth
herein and as hereafter amended.
(dd) Plan Year means the calendar year.
(ee) Rollover Account means an Account described in
Section 9.3
(ff) Trust means the Trust established by the Trust
Agreement.
(gg) Trust Agreement means the agreement entered into
between the Company and the Trustee which provides for the receiving,
holding, investing and disbursing of the assets, properties,
securities and cash in the Accounts.
(hh) Trustee means such corporation(s) and/or
individual(s) as may from time to time be designated by the
II-5
<PAGE> 13
Company to serve as Trustee under the Trust Agreement, whether one or
more.
(ii) Valuation Date means each business day in a Plan
Year on which the assets of the Plan are valued.
2.2 Construction of Terms. Whenever appropriate herein, words
used in the masculine shall be deemed to include the feminine and words used in
the singular shall be construed to include the plural and the plural to include
the singular and the use of any one gender to include the other.
II-6
<PAGE> 14
SECTION III
PLAN ADMINISTRATION
3.1 Thrift Plan Committee. The Plan shall be administered by
the Company, whose duties as the Plan Administrator shall be performed by a
Thrift Plan Committee of not less than three Employees who may, but need not,
be Participants. Members of the Committee shall be appointed by and shall hold
office at the pleasure of the Board. The Board may increase or decrease [but
not to less than three members] the membership of the Committee at any time and
from time to time. Any member of the Committee may resign by delivering his
written resignation to the Board and to the Committee. A vacancy shall exist
on the Committee if at any time there are less than three members, and any such
vacancy, whether resulting from death, resignation, removal or otherwise, shall
be filled by the Board.
3.2 Chairman, Secretary and Subcommittees. The members of the
Committee shall elect from their number a Chairman and shall appoint a
Secretary, who need not be a member of the Committee. The Committee shall
furnish to the Trustee certificates as to the identity of its Chairman and
Secretary from time to time and the designation of any other person or persons
authorized to act on behalf of the Committee, together with a specimen of the
signature of each of such persons, and the Trustee shall be entitled to rely
upon the identity and authority of the Chairman, Secretary and other persons as
disclosed by such certificates until receipt by it from the Committee of a
written revocation of such authorization. The Secretary shall keep minutes of
the Committee's proceedings and all data, records and documents relating to the
Committee's administration of the Plan. The Committee may appoint from its
number subcommittees with such powers as the Committee shall
III-1
<PAGE> 15
determine and may authorize one or more members of the Committee or any agent
to execute or deliver any instrument or make any payment on behalf of the
Committee, and they may retain such legal counsel or accountants, who may or
may not be in the employ of the Company, actuaries, physicians and such
clerical services as they may require in carrying out the provisions of the
Plan.
3.3 Meetings and Majority Vote. The Committee shall hold
meetings upon such notice, at such time and at such place as they may
determine. Notice of meetings shall not be required if waived in writing. A
majority of the members of the Committee shall constitute a quorum for the
transaction of business, and the Committee may act notwithstanding the
existence of a vacancy so long as there are at least two members of the
Committee. All resolutions or other actions taken by the Committee shall be
either by the vote of a majority of those present at a meeting at which a
majority of the members is present, or by a written instrument signed by all
members if they act without a meeting.
3.4 No Bond Required or Compensation to be Paid. The members of
the Committee shall serve without bond or other security, except as otherwise
provided by law, and without compensation for their services as such.
3.5 General Powers and Duties. The Committee shall have
complete control of the administration of this Plan, with all powers necessary
to enable it to carry out its duties in that respect, and it shall endeavor to
act, whether by general rules or by particular decisions, so as not to
discriminate in favor of or against any person. Not in limitation but in
amplification of the foregoing, the Committee shall have the power to interpret
or construe this Plan, to determine all questions that may arise hereunder as
to the eligibility of employees and the status and rights of Participants and
others, to adopt bylaws for the conduct
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<PAGE> 16
of its affairs and make rules and regulations for the administration of the
Plan which are not inconsistent with the terms and provisions hereof, and to
take such other actions relating to the administration of the Plan as are
conferred or imposed upon it hereunder and under the Trust Agreement. The
members of the Committee shall at all times comply with the provisions of ERISA
and the Code relating to fiduciaries.
3.6 Appointment and Allocation. Each person serving as a member
of the Committee shall from time to time by written instrument appoint a person
or persons other than another Committee member to carry out the fiduciary
responsibilities of such person under this Plan in the event such member shall
be unable to act due to illness, absence or any other reason. The members of
the Committee may by written agreement allocate fiduciary responsibilities
among themselves, and if such responsibilities are so allocated, then the
responsibilities of each such person shall be exercisable severally and not
jointly, with each such person's responsibilities being limited to the specific
areas which were allocated to him. Any person or group of persons may serve in
more than one fiduciary capacity with respect to the Plan, and any member of
the Committee or other fiduciary may employ one or more persons to render
advice with regard to any responsibility such person has under the Plan.
3.7 Determinations by Committee. No benefit shall be payable
under this Plan unless and until application therefor has been filed with and
approved by the Committee. Each application for benefits shall be in writing
in such form as shall be prescribed by the Committee. The Committee shall make
all determinations as to the identity and right of any person to a benefit, and
the proper amount thereof, under this Plan. Written notice of the disposition
of a claim shall be furnished by the
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<PAGE> 17
Committee to the claimant within 90 days after the claim is filed. In the
event the claim is denied, the reasons for denial shall be specifically set
forth, pertinent provisions of the Plan shall be cited, where appropriate, an
explanation shall be provided as to what additional information is needed to
perfect the claim and why, and the steps for the claimant to submit his claim
for review shall be outlined. In the event written notice of the disposition
of a claim is not provided to the claimant within the time allowed above, the
claim shall be deemed denied for purposes of the claimant's submitting a
request for review.
If the claimant wishes further consideration of his position, he may
request in writing a review with the Plan Administrator. Such request shall
state the claimant's position and shall be filed with the Plan Administrator
within 60 days after the receipt of the written denial or within 60 days after
the time allowed for the written response. The claimant or his representative
may also review pertinent documents or submit issues or comments supporting the
claim in writing. Within 60 days after receipt of the claimant's written
request a decision on the review shall be made and shall be communicated by the
Committee in writing with specific reasons and references to pertinent Plan
provisions, all written in a manner calculated to be understood by the
claimant. In the event written notice of the review is not provided within the
time allowed above, the claim shall be deemed denied upon review.
The 90-or 60-day deadline for a written response by the Committee
referred to in this Section 3.7 may be extended an additional 90 or 60 days,
respectively, by written notice thereof to the claimant before the deadline is
reached. An extension may be made only if special circumstances are involved
and if they are communicated to the claimant in the written notice.
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The payment of any benefit in accordance with the Committee's
determination shall constitute a complete discharge of all obligations on
account thereof. The Committee may require any payee, as a condition precedent
to such payment, to execute a receipt and release therefor in such form as the
Committee may prescribe.
3.8 Maintenance of Accounts and Reports. The Committee shall
cause accounts to be kept showing the fiscal transactions of the Plan. The
Committee shall render annually a report showing in reasonable detail the
assets and liabilities of the Plan and give a brief account of the operation of
the Plan for the past year to the Boards of Directors of all Employers. Such
report shall be filed in the office of the Committee where it shall be open to
inspection by any Participant or former Participant who is eligible to receive
benefits under the Plan.
3.9 Information to be Furnished. To enable the Committee to
perform its functions, each Employer shall supply full and timely information
to the Committee on all matters relating to the compensation of each of its
employees who are Participants, their retirement, death or other cause for
termination of employment, and such other pertinent facts as the Committee may
require. Each person claiming a benefit shall furnish to the Committee and/or
to the Trustee information and proof as to all facts which the Committee and/or
the Trustee may reasonably require.
3.10 Reliance on Data and Opinions. The Committee shall be
entitled to rely on all data and information furnished to it by any Employer,
the Participants and any other person entitled to receive benefits under the
Plan. Each Employer and the Committee shall be entitled to rely upon all
certificates and reports furnished by any accountant designated by the
Committee, and upon all reports, certificates and opinions furnished by any
physician selected by
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<PAGE> 19
the Employer, and upon all opinions given by any attorney selected by the
Committee.
3.11 Action Non-Discriminatory. The Committee shall not take any
action whatsoever which would result in benefiting one Participant or group of
Participants at the expense of another or in discrimination as between
Participants similarly situated, nor shall it apply different rules to
substantially similar sets of acts.
3.12 Liability of and Indemnity to Members. Subject to the
provisions of ERISA, no member of the Committee shall incur any liability or
obligation for any action taken, permitted to be taken or omitted to be taken
by him, the Committee or any other member of the Committee, except when such
action or omission is the result of his own gross negligence or willful
misconduct. The Company shall fully protect, indemnify and defend each and
every member and former member of the Committee from and against all claims,
liabilities, costs and expenses, including attorneys' fees, which may be
asserted against him, arising out of or resulting from his action or omission
to act in his capacity as a member of the Committee, except for his own gross
negligence or willful misconduct, or arising out of or resulting from any
action or omission to act by other members of the Committee.
3.13 Investment Manager. The Committee may appoint an Investment
Manager, within the meaning of ERISA Section 3(38), to manage any or all of the
assets of the Trust.
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SECTION IV
ELIGIBILITY AND PARTICIPATION
4.1 Present Participants. Each person who was a Participant in
the Plan immediately prior to this amendment shall continue as a Participant in
the Plan.
4.2 New Participants. Each person who becomes an Employee (or
transfer into the Eligible Class) on or after January 1, 1995, shall be
eligible to become a Participant in the Plan on the date he first completes an
Hour of Service in the Eligible Class by filing his application for membership
in accordance with Section 4.3 on or prior to such date. Participation in the
Plan by any Employee in the Eligible Class is entirely voluntary.
4.3 Application for Participation. Each eligible Employee
desiring to become a Participant in the Plan must, as a condition to his
participation, file a written application for participation with his Employer.
Each application for participation in the Plan shall be in such form as the
Committee shall prescribe and shall contain such information as the Committee
shall deem necessary or desirable in the operation and administration of the
Plan.
4.4 Late Commencement of Participation. An Employee need not
commence his participation in the Plan on the date he first becomes eligible to
do so but may commence his participation in the Plan on any subsequent Entry
Date, assuming he is then in the Eligible Class, by filing his application for
participation in accordance with Section 4.3 prior to the Entry Date on which
his participation in the Plan is to commence.
4.5 Change in Employment Status. In the event the status of a
Participant changes so that he is no longer in the Eligible Class but remains
an Employee, he shall continue as a Participant but thereafter shall not be
permitted to make contributions to the
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<PAGE> 21
Plan nor shall Employer matching contributions be made on his behalf. Further,
if a Participant ceases to be an Employee, he shall continue as a Participant
until his Account balances are distributed in full.
4.6 Reemployment. A former Employee shall be eligible for
participation the first date he again completes an Hour of Service in the
Eligible Class, provided he files his application for participation in
accordance with Section 4.3 on or before that date.
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SECTION V
PARTICIPANT CONTRIBUTIONS
5.1 Participant Contributions. Subject to the special
provisions of Section XI and XIX, each Participant may make a 401(k)
Contribution and/or an After-Tax Contribution to the Plan by payroll
reduction/deduction each payroll period during which he is in the Eligible
Class in such amount (in whole percentages only) of his Compensation, as
designated by the Participant in his application for participation pursuant to
Section 4.3. However, in no event may the aggregate amount of a Participant's
contributions, whether 401(k) Contributions and/or After-Tax Contributions, for
a payroll period exceed 15% of his Compensation. Further, the Committee may,
in any Plan Year, limit the maximum amount of 401(k) Contributions and/or
After-Tax Contributions that the Highly Compensated employees (as defined in
Section 19.1(b)) may make with respect to such year, or the remainder of such
year, if the Committee believes such lower limit will be necessary to satisfy
the Code Section 401(k) or (m) discrimination tests, respectively, for such
year.
No contribution may be made to the Plan by a Participant
hereunder for any payroll period unless he is a Participant in the Eligible
Class on the day his contribution is deducted and withheld by the Employer.
All 401(k) Contributions and After-Tax Contributions under this Section 5.1
shall be withheld by the Employer from the Participant's Compensation each
payroll period and paid over to the Trustee as soon as practicable thereafter
and in all events within one month of the end of such period.
5.2 Change in Contributions. Within the limitations of Section
5.1, a Participant may increase, decrease or stop the designated percentage(s)
of his Compensation to be contributed to
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<PAGE> 23
the Plan, or change the character of his contributions between 401(k)
Contributions and After-Tax Contributions, effective as of a future Entry Date
by notifying his Employer in writing prior to such Entry Date. Unless changed
in accordance with the terms of this Plan, the percentage(s) and type of
contribution(s) designated by a Participant shall continue in effect,
notwithstanding any change in his Compensation, and the amount of his
contribution(s) shall be automatically adjusted to reflect any increases in his
Compensation, but in the event a Participant's Compensation is decreased, the
dollar amount of such Participant's contribution as determined prior to such
reduction in Compensation shall continue without change or reduction unless the
Participant changes his contributions by filing a new contribution form with
his Employer as provided above.
A Participant who has voluntarily stopped his contributions
must complete an appropriate form electing to resume such contributions and
file it with his Employer prior to the Entry Date on which he elects to resume
making contributions to the Plan.
5.3 Involuntary Suspension of Participant Contributions. A
Participant's contributions to the Plan under Section 5.1 shall be
automatically suspended, and no deduction thereof shall be made by his
Employer, whenever and for so long as
(a) such Participant is no longer in the Eligible
Class, or
(b) deduction of such contributions from his
Compensation would be contrary to law.
Contributions involuntarily suspended pursuant to the Plan shall be resumed
automatically after the cause for such suspension ceases to exist, provided he
is still in the Eligible Class.
5.4 Rights During Suspension. The suspension of a Participant's
contributions to the Plan shall not affect any of his
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<PAGE> 24
other rights under the Plan, and the Trustee shall continue to adjust his
Accounts as of each Valuation Date during such period of suspension in
accordance with the provisions of Section X.
5.5 Correction of Errors in Contributions. An Employer may at
any time make adjustments because of errors in calculating previous Participant
contributions or because of information not known to the Employer at the time
of such previous calculation. Such adjustments may, but need not, be made
retroactively.
5.6 Rollover Contributions. An Employee who is a Participant
may make (by check only) a rollover contribution to the Plan, including a
direct rollover within the meaning of Code Section 401(a)(31), of any eligible
rollover amount received from another plan and trust qualified under Code
Section 401(a) (or from a qualifying IRA rollover account); provided, however,
the amount and timing of such rollover contribution must comply in all
applicable respects with the requirements of the Code concerning rollovers and
the administrative procedures established by the Committee with respect to
rollover contributions.
5.7 Affiliate Plan Transfers. If a Participant's employment is
transferred to an Affiliate that is not a participating employer in this Plan,
but which participates in a qualified defined contribution plan that permits a
direct trust-to-trust transfer of participant accounts from qualified defined
contribution plans of other Affiliates, then, upon the request of the
Participant, the Committee shall cause the Trustee to transfer such
Participant's Accounts hereunder to the trustee of such Affiliate's qualified
plan, which direction may include the liquidation of the Participant's
investments under the Plan as necessary to effectuate the transfer of his
Accounts and any other special provisions set forth on Attachment B to the
Plan.
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<PAGE> 25
Conversely, if an Employee of a nonparticipating Affiliate
is transferred to employment with an Employer under this Plan, upon the request
of the Employee, the Committee shall cause the Trustee to accept a direct
trust-to-trust transfer of the Employee's accounts under the qualified defined
contribution plan of the Affiliate, provided such Employee has completed the
necessary administrative forms, including investment fund designations for such
transferred account(s). An Employee's account(s) transferred to this Plan from
an Affiliate's plan shall be 100% vested. Further, any outstanding participant
loans under the Affiliate's plan shall be transferred and continued hereunder
without interruption or change, except to change the name of the plan trust
that is the payee of such loan, and all protected benefits of the Affiliate's
plan shall be continued under the Plan with respect to the transferred
accounts, which shall be separately accounted for hereunder if such protected
benefits are not the same as those provided under this Plan. The Committee
shall cause the "protected benefit" provisions of the transferring Affiliate's
plan to be set forth in a memorandum for each affected transferred account,
which memorandum shall be deemed to be a part of this Plan for all purposes and
is incorporated herein by reference.
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<PAGE> 26
SECTION VI
EMPLOYER MATCHING CONTRIBUTIONS, PLAN EXPENSES
AND ESOP DIVIDENDS
6.1 Amount of Matching Contributions. Subject to the other
provisions of the Plan, the Employers shall contribute to the Plan for each
payroll period, on behalf of each Participant who made contributions to the
Plan pursuant to Section 5.1 with respect to such payroll period, an amount
equal to 100% of the first 6% of Compensation contributed by such Participant
for such payroll period. The Employer's matching contribution made with
respect to a Participant shall be allocated as follows: (a) 25% to the
Participant's Company Match-Stock Account ("Matching Stock Contribution") and
(b) 75% to the Participant's Company Match-Cash Account ("Matching Cash
Contribution"). However, notwithstanding the foregoing, until the consummation
of the Merger, as defined in the Agreement and Plan of Merger dated as of
December 12, 1994, by and among The Williams Companies, Inc. ("Williams"), WC
Acquisition Corp. and the Company (the "Merger Agreement"), or the termination
of the Merger Agreement without the consummation of the Merger, all Matching
Stock Contributions shall be made in cash and temporarily invested in the
Fidelity Retirement Money Market Portfolio, or such other short-term,
interest-bearing investment as the Trustee may determine. Following the
consummation of the Merger, such Matching Stock Contributions and the income
thereon, if any, shall be reinvested in common stock of Williams (which shall
be referred to after the consummation of the Merger as Company Stock).
Alternatively, if the Merger Agreement is terminated without consummation of
the Merger, such Matching Stock Contributions and the income thereon, if any,
shall be reinvested in Company Stock.
It is the intention of the Company that the Plan qualify as
a profit sharing plan with respect to the 401(k) feature of the
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<PAGE> 27
Plan. In that regard, the Employer's Matching Cash Contributions and
Participant 401(k) Contributions shall be made only out of the Employer's
Earnings unless the Board, in its sole discretion, expressly permits such
contributions to be made with respect to a Plan Year in which there are either
no Earnings or insufficient Earnings.
It is also the intention of the Company that the Matching
Stock Contributions and Company Match-Stock Accounts of the Plan qualify as an
employee stock ownership plan (ESOP) or stock bonus plan feature under the
Plan.
6.2 Payment of Employer Contributions. Employer contributions
shall be made to the Trust in cash, provided that Company matching
contributions to be invested in the Company Stock Fund may be made in Company
Stock in the discretion of the Company. Employer matching contributions shall
be paid over to the Trustee as soon as reasonably practicable following the
payroll period in which such Participant contributions were deducted/withheld
by the Employer and in all events within one month of the end of such period.
6.3 Correction of Errors in Contributions. An Employer may at
any time make adjustments because of errors in calculating previous Employer
contributions or because of information not known to the Employer at the time
of such previous calculation. Such adjustments may, but need not, be made
retroactively.
6.4 Contributions by Affiliated Employer. If any Employer is
prevented from making a contribution which it would otherwise have made under
the Plan, by reason of having no current or accumulated earnings or profits or
because such earnings or profits are less than the contributions which it would
otherwise have made, then so much of the contribution which such Employer was
so prevented from making may be made, for the benefit of the Employees
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<PAGE> 28
of such Employer, by the other Employer(s), to the extent of current or
accumulated earnings or profits, in accordance with the provisions of Code
Section 404(a)(3)(B).
6.5 Expenses of Plan and Trust. All expenses reasonably incurred
in connection with the administration of the Plan and the Trust (including,
without limitation, bonding costs, attorneys', recordkeepers' and accountants'
fees and charges and the fees of the Trustee) shall be paid by the Employers.
The expenses to be paid by the Employers for each Plan Year may be allocated
among the individual Employers in such manner as the Committee deems equitable.
6.6 ESOP Share Dividends. All cash dividends paid with respect
to shares of Company Stock held in a Company Match-Stock Account may be paid
either directly to the Participants (or their Beneficiaries, as the case may
be) or to the Trustee, and if paid to the Trustee, they shall be distributed to
the Participants (and Beneficiaries) in cash as soon as practicable after the
date received and in any event not later than 90 days after the end of the Plan
Year in which the dividends were paid to the Trustee. This Section 6.6 shall
become ineffective if the Matching Stock Contributions feature of the Plan
ceases to qualify as an ESOP feature or such dividend "pass-throughs" cease to
be deductible under Code Section 404(k).
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SECTION VII
MANAGEMENT OF PARTICIPANT ACCOUNTS
7.1 Trust Agreement. As a part of this Plan, the Company shall
enter into a Trust Agreement with one or more Trustees to provide for the
receiving, holding, investing and disbursing of contributions to the Plan,
together with the increment, increase and income thereof and therefrom; the
properties and other assets of such Accounts shall constitute the trust fund of
the Trust. The Trust Agreement shall constitute a part of this Plan and all
rights which may accrue to any person under this Plan shall be subject to all
of the terms and provisions of such Trust Agreement. The Trust Agreement shall
be subject to amendment and modification in accordance with the provisions of
this Plan and such Trust Agreement.
7.2 Trustee. The Trustee shall be appointed by the Board, with
such rights, powers and authorities as are set forth in the Trust Agreement and
any amendment thereto or modification thereof. Any Trustee may be removed by
the Board at any time as provided in the Trust Agreement, and upon any such
removal or upon resignation of any Trustee, a successor Trustee shall be named
by the Board.
7.3 Trust Assets for Exclusive Benefit of Participants. Except
as provided below, all assets held by each Trustee under the Plan shall be held
in trust for the exclusive benefit of Participants and their Beneficiaries
under the Plan, and no part of the corpus or income shall ever revert to any
Employer or be used for, or diverted to, purposes other than for the exclusive
benefit of Participants and their Beneficiaries under the Plan. No such person,
nor any other person, shall have any interest in or right to any part of the
earnings of any Account, or any rights in, to or under the Trust or any part of
its assets, except to the extent
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expressly provided in the Plan. Each Participant or other person who shall
claim the right to any payment under the Plan shall be entitled to look only to
the trust fund of the Trust for such payment.
An Employer contribution made based on a good faith mistake
of fact or good faith mistake in determining the deductibility of the
contribution shall be returned to the Employer within one year of the mistaken
payment or the disallowance of the deduction, as the case may be. The amount
returnable is the excess of the amount contributed over the amount that would
have been contributed had there not occurred such mistake. However, earnings on
the excess amount may not be so returned and any losses attributable to such
amount shall reduce the amount returnable. Further, the amount returnable
cannot cause the Account of any Participant to be reduced to less than it would
have been had the mistaken amount not been contributed.
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<PAGE> 31
SECTION VIII
INVESTMENT PROVISIONS
8.1 Initial Investment of Accounts. At the time an Employee
first becomes a Participant, he shall direct, on a Plan form prescribed by the
Committee, that all or a designated percentage of his Accounts (other than his
Company Match-Stock Account) shall be invested in any one or more of the
investment funds offered under the Plan as shown on Attachment A to this Plan,
which attachment shall be a part of the Plan for all purposes. The Committee
may from time to time amend Attachment A and in conjunction with such amendment
direct the Trustee to establish new and/or delete or freeze existing investment
funds and options. If so directed by the Participants, up to 100% of the Plan
assets may be invested in Company Stock. Any investment direction given by a
Participant shall be deemed to be a continuing direction until changed by the
Participant in accordance with Section 8.2. If a Participant fails to timely
give an initial investment direction, his Accounts (other than his Company
Match-Stock Account) shall be automatically invested in the investment fund so
designated on Attachment A for default elections until changed by the
Participant in accordance with Section 8.2.
No provision of this Plan shall constitute a guarantee by
the Employers or Trustee of the value of any investment fund offered under the
Plan or an indemnity against any loss resulting from investing in any such
option.
8.2 Change in Investments. Subject to any restrictions or
limitations set forth in Attachment A, a Participant (or where applicable, a
Beneficiary or alternate payee under a qualified domestic relations order) may
change his investment election on any Valuation Date with respect to (i) the
Current Balance of any or
VIII-1
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all his Accounts (ii) his future contributions, and/or (iii) the Employer's
future matching contributions (other than the Matching Stock Contribution) to
be made on his behalf by telephoning the Plan recordkeeper. However, if a
Participant directs the reinvestment of all or any part of his Company
Match-Stock Account into another investment fund other than pursuant to Section
8.3 below, the Participant shall be ineligible to receive any Company matching
contribution during the six months following such reinvestment and such
reinvestments shall cease to be a part of the ESOP portion of the Plan. Such
investments shall be transferred to and accounted for under the Participant's
Company Match-Cash Account and thereafter shall be part of the profit sharing
portion of the Plan.
8.3 ESOP Diversification Election. Each Participant who has
completed 10 or more years of participation in the Plan and who has reached age
55 (a "qualified Participant") may elect (on a Plan form provided by the
Committee), within 90 days after the close of each Plan Year during the
"election period", to direct the Trustee to reinvest up to 25% (50% for any
Plan Year after reaching age 60 and completing 10 or more years of
participation) of his Company Match-Stock Account (to the extent such portion
exceeds the amount to which a prior election under this Section 8.3 has been
made) in one or more of the investment funds offered under the profit sharing
feature of the Plan, provided the Plan then offers at least three investment
options (other than one investing in qualifying employer securities) that
qualify for diversification purposes under Code Section 401(a)(28). The
"election period" shall be the six-Plan Year period beginning with the Plan
Year the Participant first became a qualified Participant. Such reinvestment
shall be made as soon as the Committee deems it practicable and in no event
later than 180 days after the close of the Plan Year for which the
VIII-2
<PAGE> 33
election is made. If the Plan does not offer three qualifying investment
options, the portion of the Company Match-Stock Account covered by the election
shall be distributed to the qualified Participant by the Trustee within 180
days after the close of the Plan Year for which such election was made,
notwithstanding anything in the Plan to the contrary; provided, however, if the
vested amount of such Participant's Accounts exceeds (or at the time of any
prior withdrawal exceeded) $3,500, the Participant must consent in writing to
the distribution and absent such consent, such distribution shall not be made
from the Plan. A direction given by a Participant to the Trustee pursuant to
Section 8.5 to tender or offer to exchange Company Stock held in his Company
Match-Stock Account shall not be treated as a direction to reinvest described
in the preceding sentence.
8.4 Voting of Company Stock. Shares of the Company Stock held
by the Trustee in a Participant's Accounts under the Company Stock Fund will be
voted by the Trustee in accordance with written instructions from the
Participant; provided, however that if the Trustee has not received written
voting instructions from a Participant with respect to shares held in his
Company Match-Stock Account at least five days prior to the date of the meeting
at which such vote is to be taken, the Trustee shall vote any stock in such
Account in such manner as the Trustee determines to be in the best interests of
the Participant. Notice of any such meeting shall be given by the Trustee to
the Participant and a request for voting instructions shall be made by the
Trustee at such time and in such form as may be provided by rules and
regulations adopted by the Committee.
Any provision herein requiring a Participant to give notice
or a direction to the Trustee may be accomplished by such Participant
delivering written evidence of such notice or such
VIII-3
<PAGE> 34
direction to the Committee and the Committee shall transmit such information to
the Trustee promptly upon receipt of such written evidence. For purposes
hereof, the Trustee shall be deemed to have received any such notice or
direction when such written evidence thereof is delivered to the Committee.
Notwithstanding anything in the Plan to the contrary, in administering the
voting of shares of Company Stock pursuant to the applicable provisions of the
Plan, it is intended that the confidentiality of the votes made by Participants
pursuant to the provisions of the Plan shall be maintained by the Trustee and
the Committee as contemplated in Section 203 of the General Corporation Law of
the State of Delaware.
8.5 Tender and Exchange Offers. The provisions of this Section
8.5 shall apply in the event that a tender offer, which is subject to Section
14(d)(1) of the Securities Exchange Act of 1934, as amended, is made for shares
of Company Stock or an offer to exchange securities of another company for
shares of Company Stock, which is subject to the Securities Act of 1933, as
amended, is made. Upon such a tender or exchange offer occurring, the Company
and the Trustee shall utilize their best efforts to notify each affected
Participant and to cause to be distributed to him such information as will be
distributed to the shareholders of the Company generally in connection with any
such tender or exchange offer and a form by which the Participant may direct in
writing the Trustee as to what action, as set forth below, to take on behalf of
that Participant with respect to his Accounts invested in the Company Stock
Fund. If the Trustee does not receive such written directions from a
Participant, the Trustee shall not tender or offer to exchange any shares of
Company Stock held in the Participant's Accounts invested in the Company Stock
Fund.
VIII-4
<PAGE> 35
(a) Cash Tender Offer. In connection with a cash tender offer,
a Participant may direct the Trustee to tender any or all shares of Company
Stock held in the Participant's Accounts invested in the Company Stock Fund.
Any cash received by the Trustee as a result of such tender shall be reinvested
by the Trustee in one or more of the investment options provided for in the
Plan as specified by the Participant in his tender direction (which may include
the Company Stock Fund if Company Stock is available for purchase, or is
expected to be available for purchase within a reasonable period, after such
tender), and absent an investment direction such cash shall be automatically
reinvested as provided in the default election under Attachment A.
(b) Exchange Offer. In connection with an exchange offer, a
Participant may direct the Trustee to offer for exchange any or all shares of
Company Stock held in the Participant's Accounts invested in the Company Stock
Fund. Any property received by the Trustee in connection with such exchange
shall be held by the Trustee under the Plan in separate accounts for the
affected Participants; however, if such property does not constitute
"qualifying employer securities" under ERISA, the Participant shall be given an
opportunity to direct the Trustee to reinvest the proceeds of such property
(which the Trustee shall sell) in one or more of the investment options
provided for in the Plan (which may include the Company Stock Fund if Company
Stock is available for purchase after such exchange) and absent such an
investment direction, automatically as provided in the default election under
Attachment A.
(c) Tender and Exchange Offer. In connection with a combination
tender and exchange offer, a Participant may direct the Trustee to tender and
offer for exchange any or all shares of Company Stock held in the Participant's
Accounts invested in the
VIII-5
<PAGE> 36
Company Stock Fund with any cash received by the Trustee as a result of such
tender treated as provided in (a) above and any property received by the
Trustee in connection with the exchange treated as provided in (b) above.
A tender or exchange offer direction given by a Participant may be
revoked by the Participant by completion of the form prescribed therefor by the
Committee provided such form is filed with the Trustee at least two business
days prior to the withdrawal-date-deadlines provided for in the regulations
with respect to tender or exchange offers prescribed by the Securities and
Exchange Commission.
The Trustee shall use its best efforts to effect on a uniform and
nondiscriminatory basis the sale or exchange of the shares of Company Stock as
directed by the Participants. However, neither the Committee nor the Trustee
insures that all or any part of the shares of Company Stock directed by a
Participant to be tendered or exchanged will be accepted under the tender or
exchange offer. Any such shares not so accepted shall remain in the
Participant's Accounts and the Participant shall continue to have the same
rights with respect to such shares as he had immediately prior to the Trustee's
tendering of the shares.
If a tender or exchange offer is made, the Committee shall adopt such
rules, prescribe the use of such special administrative forms and procedures,
delegate such authority, take such action and execute such instruments or
documents and do every other act or thing as shall be necessary or in its
judgment proper for the implementation of this Section 8.5. In administering
the tendering or exchange of shares of Company Stock, it is intended that the
confidentiality of the tenders or exchanges, as the case may be, made by the
Participants shall be maintained by the Trustee and the
VIII-6
<PAGE> 37
Committee as contemplated in Section 203 of the General Corporation Law of the
State of Delaware.
(d) For purposes of this Section 8.5, each Participant shall be
named fiduciary with respect to the shares of Company Stock held by the Trustee
in the Participant's Accounts under the Company Stock Fund.
8.6 Put Option. In the event and to the extent a former
Participant or Beneficiary is distributed ESOP Shares (shares from the ESOP
portion of this Plan) which are not readily tradable on an established
securities exchange or which are subject to a trading limitation (as defined in
Treas. Reg. Section 54.4975-7(b)(1)), such former Participant or Beneficiary
shall be granted, at the time that such ESOP Shares are distributed to him, a
put option to sell such ESOP Shares to the Plan (which put option is nonbinding
with respect to the Plan), and then, if refused by the Plan, to the Company (or
its delegate). The put option shall extend for a period of 60 days following
the date that such ESOP Shares are distributed to the former Participant or
Beneficiary, at which time the put option will temporarily lapse. After the
end of the Plan Year in which such put option lapses, and following
notification to each former Participant or Beneficiary who continues to hold
such distributed ESOP Shares of the value of such ESOP Shares as of the end of
such Plan Year, each such former Participant or Beneficiary shall have an
additional put option for the 60-day period immediately following the date such
notification is given to such former Participant or Beneficiary. The period
during which the put option is exercisable shall not include any period during
which the Participant or Beneficiary is unable to exercise such put option
because the Company is prohibited from honoring it by federal or state law. To
exercise this put option, a former Participant or Beneficiary shall submit
written notice to the Committee of his
VIII-7
<PAGE> 38
desire to have the Plan or Company (or its delegate) purchase all or a
designated portion of such ESOP Shares which were distributed to him. Upon
receipt of such written notice, the Committee, on behalf of the Plan, shall
have the right to direct the Trustee to purchase all or a portion of the
tendered ESOP Shares on the terms set forth below. If the Committee, on behalf
of the Plan, declines to direct the Trustee to purchase the tendered ESOP
Shares or a portion thereof, it shall notify the Company of such determination
and shall submit to the Company the former Participant's or Beneficiary's
written notice of his desire to have the Plan or the Company (or its delegate)
purchase all or a designated portion of the ESOP Shares which were distributed
to him. Upon receipt of such written notice, the Company (or its delegate)
shall purchase the tendered ESOP Shares or such portion thereof as was not
purchased by the Plan on the terms set forth below. It is specifically provided
that the trustee or custodian of a rollover individual retirement account of a
former Participant shall have the same put option as described herein with
respect to such former Participant.
Any ESOP Shares purchased by the Plan or the Company (or its delegate)
pursuant to the put option provided in this Section 8.6 shall be purchased as
soon as practicable after the exercise of such put option, at a price equal to
the fair market value of ESOP Shares as of the most recent valuation of ESOP
Shares preceding the date of such purchase; provided, however, that in the case
of purchase from a "disqualified person," as defined in Section 4975(e)(2) of
the Code, such fair market value shall not exceed the fair market value of ESOP
Shares at the date of such purchase. Payment by the Plan or the Company (or its
delegate) for ESOP Shares pursuant to this put option shall be, as determined
by the Company, by a single lump sum cash payment or, if the distribution
VIII-8
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constitutes a total distribution, in substantially equal annual installments
(beginning no later than thirty days after the date the put option is
exercised) over a period of not more than five years after the put option is
exercised. The purchaser must pay a reasonable rate of interest and provide
adequate security for amounts not paid after thirty days.
8.7 Independent Appraiser. Notwithstanding anything in the Plan
to the contrary, for Plan purposes all valuations of shares of Company Stock
(or any other employer securities) which are not readily tradable on an
established securities market shall be made at least annually by an independent
appraiser meeting requirements similar to the requirements of the regulations
prescribed under Code Section 170(a)(1).
VIII-9
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SECTION IX
ACCOUNTS
9.1 After-Tax Accounts. The Committee shall cause to be
maintained for each Participant a separate After-Tax Account which shall
reflect his own After-Tax Contributions made to this Plan, if any, and the
investment (earnings/losses) of such contributions in the investment funds
permitted under Attachment A. The Committee shall also cause to be maintained
a subaccount thereunder to reflect his After-Tax Contributions made prior to
1987, if any.
9.2 401(k) Accounts. The Committee shall cause to be maintained
for each Participant a separate 401(k) Account which shall reflect his own
401(k) Contributions made to the Plan, if any, and the investment
(earnings/losses) of such contributions in the investment funds permitted under
Attachment A.
9.3 Rollover Accounts. The Committee shall cause to be
maintained for each Participant a separate Rollover Account which shall reflect
his rollover contributions made to the Plan, if any, and the investment
(earnings/losses) of such contributions in the investment funds permitted under
Attachment A.
9.4 Company Match-Cash Accounts. The Committee shall cause to
be maintained for each Participant a separate Company Match-Cash Account which
shall reflect the Matching Cash Contributions made on his behalf on or after
July 1, 1992, and the investment (earnings/losses) of such contributions in the
investment funds permitted under Attachment A.
9.5 Company Match-Stock Accounts. The Committee shall cause to
be maintained for each Participant a separate Company Match-Stock Account which
shall reflect the Employer's Matching Stock Contributions made on his behalf
and the cash and shares of Company Stock held in such Account.
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<PAGE> 41
9.6 Old Company Accounts. The Committee shall cause to be
maintained a separate Old Company Account for each Participant (or Beneficiary)
who, as of July 1, 1992, had an account reflecting Employer contributions,
which shall reflect the balances of such Accounts as of that date and the
investment (earnings/losses) of such Account after that date.
9.7 Account Information. The Committee shall deliver or cause to
be delivered to each Participant, at least annually, a statement, in such form
as the Committee shall determine, setting forth pertinent information relative
to such Participant's Accounts. Such statements may be delivered by mailing
the same to the Participant at his address as shown by the Committee's records,
and such statement shall, for all purposes, be deemed to have been accepted as
correct unless the Committee is notified in writing to the contrary within
thirty days after the date of delivery thereof to the Participant.
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<PAGE> 42
SECTION X
ALLOCATIONS AND ACCOUNT BALANCES
10.1 Allocation of Participant Contributions. A Participant's
401(k), After-Tax and/or Rollover Contributions shall be credited currently to
his 401(k) Account, After-Tax Account and Rollover Account, respectively.
10.2 Allocation of Matching Contributions. The Employer's
Matching Cash Contributions and Matching Stock Contributions made on behalf of
a Participant shall be credited currently to his Company Match-Cash Account and
Company Match-Stock Account, respectively.
10.3 Calculation of Account Balances. The Current Balance of any
Account on any Valuation Date shall be (i) with respect to an Account invested
in a mutual fund, the fair market value of the units allocated to such Account,
(ii) with respect to an Account invested in a GIC fund, the "book value" of
such account as reported by the insurance company and/or bank, subject to any
applicable market value adjustments as provided in the investment contract, and
(iii) with respect to the Company Stock Fund, the amount of cash and the number
of shares of Company Stock credited to such Account as of such Valuation Date.
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SECTION XI
LIMITS ON BENEFITS
11.1 Applicability of Restrictions. The special restrictions
upon benefits contained in this Section XI supersede and control any other
provisions of the Plan in conflict therewith; however, the provisions of Code
Section 415 that may not be applied in more than one manner are hereby
incorporated by reference and shall control over any Plan provision in conflict
therewith.
11.2 Special Definitions Applicable to Section XI. For purposes
of this Section XI, the following words and phrases shall have the meanings
stated below:
(a) Adjustment means the adjustment made for increases
in the cost of living pursuant to Code Section 415(d).
(b) Annual Addition means, with respect to a
Participant, the sum for any Plan Year (which shall also be the
limitation year for Code Section 415 purposes) of:
(1) Employer contributions;
(2) Employee contributions;
(3) forfeitures; and
(4) amounts described in Code Sections
415(1)(1), 419(e) and 419A(f)(2) allocated
to such Participant's accounts in a defined
contribution plan of an Employer or
Affiliate.
11.3 Defined Contribution Limit. Notwithstanding any provision of
the Plan to a contrary, in no event shall the Annual Additions with respect to
a Participant in a defined contribution plan for a Plan Year exceed the lesser
of:
(a) $30,000 (or, if greater, 1/4th of the Code Section
415(b)(1)(A) dollar limitation in effect as of the beginning of the
Plan Year), subject to Adjustment; or
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(b) 25% of the Participant's Code Section 415
Compensation (as defined below) for such Plan Year.
The compensation limit referred to in (b) above shall not apply to any
contribution for medical benefits (within the meaning of Code Section
419A(b)(2)) after separation from service which is otherwise treated as an
Annual Addition, or any amount otherwise treated as an Annual Addition under
Code Section 415(1)(1).
For purposes of this Section XI, Code Section 415
Compensation means (i) a Participant's earned income, wages, salaries, and fees
for professional services, and other amounts received (without regard to
whether or not an amount is paid in cash) for personal services actually
rendered in the course of employment with the employer maintaining the plan to
the extent that the amounts are includable in gross income (including, but not
limited to, commissions paid salesmen, compensation for services on the basis
of a percentage of profits, commissions on insurance premiums, tips, bonuses,
fringe benefits, reimbursements and expense allowances), (ii) amounts described
in Code Sections 104(a)(3), 105(a) and 105(h), but only to the extent that
these amounts are includable in the gross income of the Employee, (iii) amounts
paid or reimbursed by the Employer for moving expenses incurred by the
Employee, but only to the extent that these amounts are excludable from gross
income of the Employee, (iv) the value of a nonqualified stock option granted
to an Employee, but only to the extent such value is included in the gross
income of the Employee for the taxable year in which granted and (v) the amount
included in the gross income of the Employee upon making the election under
Code Section 83(b) and excluding the following:
(a) Contributions made by the Employer to a plan of
deferred compensation to the extent that, before the application of
the Section 415 limitations to that plan, the
XI-2
<PAGE> 45
contributions are not includable in the gross income of the Employee
for the taxable year in which contributed. In addition, Employer
contributions made on behalf of an Employee to a simplified employee
pension described in Section 408(k) are not considered as compensation
for the taxable year in which contributed to the extent such
contributions are deductible by the Employee under Section 219(b)(7).
Additionally, any distributions from a plan of deferred compensation
are not considered as Code Section 415 compensation, regardless of
whether such amounts are includable in the gross income of the
Employee when distributed. However, any amounts received by an
Employee pursuant to an unfunded non-qualified plan may be considered
as Code Section 415 Compensation in the year such amounts are
includable in the gross income of the Employee;
(b) Amounts realized from the exercise of a
non-qualified stock option, or when restricted stock (or property)
held by an Employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture (see Section 83 and the
regulations thereunder);
(c) Amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified stock option; and
(d) Other amounts which receive special tax benefits,
such as premiums for group term life insurance (but only to the extent
that the premiums are not includable in the gross income of the
Employee), or contributions made by an employer (whether or not under
a salary reduction agreement) towards the purchase of an annuity
contract described in Section 403(b) (whether or not the contributions
are excludable from the gross income of the Employee).
XI-3
<PAGE> 46
Compensation for any limitation year (Plan Year) is the compensation actually
paid or includable in gross income during such year.
11.4 Limitation for Two Types of Plans. If a Participant is at
any time a participant in both a defined benefit plan and a defined
contribution plan maintained by an Employer or an Affiliate, the sum of the
"defined benefit plan fraction" and the "defined contribution plan fraction"
for any Plan Year may not exceed 1.0 and, if necessary, the annual benefit of
the defined benefit plan will be reduced first so that the sum of the fractions
will not exceed 1.0; in no event will the annual benefit be decreased below the
amount of the accrued benefit to date. If additional reductions are required
for the sum of the fractions to equal 1.0, the reductions will then be made to
the Annual Additions of the defined contribution plans. For the purposes of
applying the foregoing limitations, all defined benefit plans and all defined
contribution plans, whether or not terminated, of an Employer or Affiliate are
to be treated as one defined benefit plan and one defined contribution plan,
respectively; however, if defined contribution plans are combined (or the
combined limit is exceeded) and the Annual Addition is required to be reduced,
the Annual Addition to this Plan shall be reduced first.
11.5 Special Rules for Plans Subject to Overall Limitations Under
Code Section 415(e). The Annual Addition for any Plan Year beginning before
January 1, 1987, shall not be recomputed to treat all Employee contributions as
an Annual Addition. If the Plan satisfied the applicable requirements of
Section 415 of the Code as in effect for all Plan Years beginning before
January 1, 1987, an amount shall be subtracted from the numerator of the
defined contribution plan fraction (not exceeding such numerator) as prescribed
by the Secretary of the Treasury so that the sum of the
XI-4
<PAGE> 47
defined benefit plan fraction and defined contribution plan fraction computed
under Section 415(e)(1) of the Code does not exceed 1.0 for such Plan Year.
11.6 Reallocation of Excess Contributions. If due to a
reasonable error in estimating compensation or in determining the amount of his
401(k) Contributions, an allocation to a Participant shall exceed the amounts
permitted to be allocated thereto for any Plan Year under this Section XI, the
Participant's After-Tax Contributions, to the extent not matched by the
Employer, shall be returned to the Participant with any allocable Trust gains
thereon, and if the excess is not cured by such action, then the Participant's
401(k) Contributions (including, with respect to limitation years beginning
after December 31, 1995, allocable Trust gains thereon), to the extent not
matched by the Employer, shall be returned to the Participant and if the excess
is still not cured, the excess attributable to Employer matching contributions
shall be carried over to the next Plan Year and allocated to such Participant
for that next Plan Year, provided the Participant remains covered by the Plan,
before any other Employer contributions may be allocated to the Participant,
subject to the limitations of this Section XI. Any amounts not able to be so
allocated shall be allocated to all other Participants.
XI-5
<PAGE> 48
SECTION XII
VESTING OF ACCOUNTS
12.1 All Accounts. A Participant shall at all times, regardless
of his years of service, have a full 100% vested (nonforfeitable) interest in
the Current Balances of all his Accounts.
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<PAGE> 49
SECTION XIII
DISTRIBUTIONS, WITHDRAWALS, FORFEITURES AND LOANS
13.1 Termination of Service. Upon a Participant's termination of
employment with the Employers and Affiliates, the total vested portion of the
Current Balances of his Accounts shall be immediately distributed to him in a
lump sum if the vested Current Balances of his Accounts do not exceed (and at
the time of any prior withdrawal did not exceed) $3,500. If the Participant's
Accounts are not immediately distributable as provided above, the distribution
of his Accounts shall be made or begin under the Plan on the Valuation Date
coincident with or immediately following the earliest of such Participant's
65th birthday, death or written consent to such distribution; however, a
Participant may elect to defer such distribution until a date that is after his
65th birthday and prior to the April 1 next following the year in which he
reaches age 70 1/2.
Distributions not immediately cashed out under the
provisions above shall be paid in five substantially equal annual installments,
unless the Participant elects, by filing the proper form with the Plan prior to
the commencement of the installment payments, to receive a lump sum. A
Participant who is receiving installments may elect at any time to accelerate
the balance of such installments.
Notwithstanding anything in the Plan to the contrary,
amounts held in the Participant's 401(k) Account may not be distributed prior
to the earliest of:
(a) his termination of service (within the
meaning of Code Section 401(k)), disability, or death;
(b) his attainment of age 59 1/2;
XIII-1
<PAGE> 50
(c) a financial hardship as provided in Section
13.4;
(d) the termination of the Plan without
establishment of a successor plan;
(e) the date of the sale or other disposition
by an Employer to an entity that is not an Affiliate of
substantially all of the assets (within the meaning of Code
Section 409(d)(2)) used by such corporation in a trade or
business of such corporation with respect to a Participant
who continues employment with the corporation acquiring such
assets, provided the Employer continues to maintain the
Plan; or
(f) the date of the sale or other disposition
by an Employer of its interest in a subsidiary (within the
meaning of Code Section 409(d)(3)) to an entity which is not
an Affiliate with respect to a Participant who continues
employment with such subsidiary, provided the Employer
continues to maintain the Plan.
13.2 401(k) Account - Age 59 1/2 Withdrawals. A Participant who
is age 59 1/2 or older may withdraw all or a specified portion of the Current
Balance of his Participant 401(k) Account as of any Valuation Date; provided,
however, only two such withdrawals may be made in any calendar year.
13.3 After-Tax Account, Old Company Account and Rollover Account
Withdrawals. A Participant may withdraw all or a specified portion of the
Current Balance of his After-Tax Account, Old Company Account, and/or Rollover
Account as of any Valuation Date; provided, however, (i) only two such
withdrawals may be made in any calendar year, and (ii) if a Participant who has
participated in the Plan for less than 12 months makes a withdrawal from his
After-Tax Account, he shall be suspended from making After-Tax and 401(k)
XIII-2
<PAGE> 51
Contributions for a period of twelve months following such withdrawal.
Withdrawals from an After-Tax Account shall be taken first from any pre-1987
contributions made by the Participant.
13.4 Hardship Withdrawals. A Participant who is an Employee and
has already obtained all other distributions and all nontaxable loans, if any,
currently available to him under the Plan and all other qualified plans of the
Employer and its Affiliates, may at any time make a request for a hardship
withdrawal from his Accounts; however, no such request shall be approved by the
Committee unless it finds that the Participant is facing an "immediate and
heavy financial need" (as defined below).
The amount of a hardship withdrawal shall be limited to an amount that
does not exceed that amount which the Committee determines is required to meet
the immediate and heavy financial need created by the hardship, including any
amounts necessary to pay any federal, state or local income taxes or penalties
reasonably anticipated to result from the hardship distribution. A Participant
shall specify which Accounts the hardship withdrawal is to be made from. The
entire Current Balance of each Account, other than the earnings of the 401(k)
Account, are available for such withdrawal. Upon making a hardship withdrawal,
no Company matching contributions shall be made with respect to such
Participant during the six-month period following the hardship withdrawal. A
hardship withdrawal shall be made in a lump sum as soon as practical after the
date the Participant's requested hardship withdrawal is approved.
The following standards shall be applied on a uniform and
non-discriminatory basis in determining the existence of a hardship. A
financial need shall be deemed to be an "immediate and heavy financial need"
only if it is on account of:
XIII-3
<PAGE> 52
(1) Uninsured medical expenses described in Section
213(d) of the Code incurred or to be incurred by the Participant, the
Participant's spouse, or any dependents of the Participant (as defined
in Section 152 of the Code);
(2) Costs directly related to the purchase (excluding
mortgage payments) of the principal residence of the Participant;
(3) Payment of tuition, related educational fees, and
room and board expenses for the next 12 months of post-secondary
education for the Participant, his or her spouse, children, or
dependents (as defined in Section 152 of the Code);
(4) The need to prevent the eviction of the Participant
from his principal residence or foreclosure on the mortgage of the
Participant's principal residence; or
(5) Any other "safe harbor" need provided by IRS
regulations or rulings;
and may be an "immediate and heavy financial need," as determined by the
Committee based on all relevant facts and circumstances, if it is on account
of:
(6) Uninsured losses due to theft, fire, vandalism or
natural disasters;
(7) Needed supplemental income to offset loss of
earnings to Participants (or their spouses) who are on medical or
disability leaves of absence and whose income has been reduced as a
result thereof;
(8) Payment of final obligations incurred in connection
with an involuntary move out of an Employer-owned house;
(9) Needed supplemental income to offset the loss of
earnings of a Participant's spouse due to a layoff or involuntary
termination of such spouse's employment;
(10) Payment of a court-ordered divorce property
settlement and related costs, including attorneys' fees and court
costs;
(11) Expenses associated with the sale of the
Participant's primary residence (and if associated with an Employer
transfer, not paid by the Employer);
(12) Expenses associated with the addition of a living
area to the Participant's primary residence;
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<PAGE> 53
(13) Expenses associated with the refinancing of a
mortgage on the Participant's primary residence;
(14) Funeral expenses for the Participant's spouse,
children, parents, brothers, sisters, or spouse's parents; or
(15) Uninsured medical expenses of members of the
Participant's family (including children, parents, brothers, sisters
and spouse's parents) that are not medical expenses covered by item
(1) above.
Unless the Committee has actual knowledge to the contrary, a
distribution will be treated as "necessary to satisfy a financial need" if the
Participant furnishes the Committee a written representation that the
Participant's need cannot reasonably be relieved:
(a) through reimbursement or compensation by insurance
or otherwise;
(b) by liquidation of the Participant's assets,
including those of his spouse and minor children;
(c) by cessation of his contributions under the Plan; or
(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 in an amount sufficient to satisfy the need.
13.5 Loans. A Participant (or Beneficiary), who is a "party in
interest" as defined in ERISA Section 3(14), may borrow from his Accounts under
the Plan, subject to the following provisions of this Section 13.5. A
Participant seeking a loan hereunder must complete a written application which
shall specify the terms pursuant to which the loan is to be made, and provide
such other information and documentation as the Committee shall reasonably
require. The Committee shall, in accordance with its established standards,
review and approve or disapprove a completed application as soon as practicable
after its receipt thereof, and shall promptly notify the applying person of
such approval or disapproval. A loan shall be subject to the following
requirements:
XIII-5
<PAGE> 54
(a) The loan may not exceed the lesser of (i) $50,000,
reduced by the excess, if any, of the highest outstanding balance of
such plan loans to the Participant during the one-year period ending
on the day before the loan is made over the outstanding balance of
such plan loans, if any, on the date when the loan is made, or (ii)
50% of the value of the Participant's vested interest in his Accounts.
For this purpose, all plans of the Employers and Affiliates shall be
considered one plan;
(b) The loan must be for at least $1,000;
(c) The loan shall provide for a fixed rate of interest
for the entire term of the loan. The applicable
interest rate for Plan loans shall be a reasonable
rate equal to a commercially comparable rate as
established by the Committee from time to time
consistent with the applicable provisions of the
Code and other legal requirements;
(d) The loan shall be for a term designated by the
borrower, which must be in a multiple of six
months, but cannot be less than six months or
exceed sixty months;
(e) No more than two loans may be outstanding at any
time; and
(f) If a loan is made from the Company Match-Stock
Account and involves the sale of Company Stock by
the Trustee, the Participant will not be eligible
to receive a Company matching contribution during
the six-month period following such loan.
Each loan shall be evidenced by a promissory note executed
by the borrower and payable to the Trust, due and payable
XIII-6
<PAGE> 55
in full not later than the earlier of: (i) its fixed maturity date meeting the
requirements above or (ii) the time which the person ceases to be a party in
interest to the Plan. The promissory note shall provide for the payment of
equal installments each pay period of principal and interest on the unpaid
balance of principal at the fixed annual rate on the date the note is executed
and further provide, with respect to a person who is an Employee, that the
payments shall be made through payroll deductions. The promissory note shall
evidence such additional terms as are required by this Section 13.5 or the
Committee.
Loans shall be funded by exhausting Accounts or portions
thereof in the following order: first, the Company Match-Cash Account; second,
the 401(k) Account; third, the Old Company Account; fourth, the Rollover
Account; fifth, the After-Tax Account; and sixth, the Company Match-Stock
Account. Each loan shall be made only from the Accounts of the borrowing
Participant, shall be taken from the investment funds in which such Accounts
are invested in accordance with the instructions of the Participant, and a loan
(and its note) shall be treated as a separate investment of, and shall be
allocated solely to, the Participant's Accounts from which the Participant's
loan was funded.
A person may elect to prepay the entire balance of the loan
at any time. No partial prepayments will be permitted. All loan repayments
shall be transmitted by the Employer to the Trustee as soon as practicable
after such amounts are withheld or received.
Each loan repayment of principal and interest will be
allocated to the Participant's Accounts in accordance with the Participant's
current investment direction for future contributions to the Plan, or, if there
is current investment direction in effect, then in the investment fund so
designated on Attachment A
XIII-7
<PAGE> 56
for default elections until changed by the Participant in accordance with
Section 8.2.
Each loan under the Plan shall be secured by 50% of the
present value of the Participant's entire vested interest in the Plan.
If a Participant with an outstanding loan takes a Leave of
Absence or incurs a temporary disability such that the regular installment
payments cannot be made on a payroll deduction basis, the Participant will be
required to make the regular payments of principal and interest at the time and
place established by the Committee.
If any time prior to the full repayment of a loan, the
Participant or Beneficiary should cease to be a party in interest, or the Plan
should terminate, or any event of default otherwise occurs under the documents
evidencing the loan, the unpaid balance owed by the Participant on the loan
shall be due and payable in full 90 days after such event without notice or
demand. If the Participant or Beneficiary does not repay the full amount of
the unpaid balance within the time established by the Committee, the Committee
may take whatever steps it deems necessary to collect the unpaid balance of the
loan plus any accrued interest; provided, however, a Participant's 401(k)
Account shall not be reduced by reason of a loan default prior to the date that
a distribution event under the Plan occurs that permits such a reduction upon
distribution.
Notwithstanding anything to the contrary contained herein,
each loan shall be made only in accordance with the regulations and rulings of
the Internal Revenue Service, including that all plans of the Employers and
their Affiliates be treated as one plan, and other applicable state and federal
laws. The
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Committee shall act in its sole discretion to ascertain whether the
requirements of such laws, regulations, and rulings have been met.
13.6 Investment Fund Withdrawal Order. Distributions,
withdrawals and loans under the Plan shall, if the Participant has his
Account(s) invested in more than one investment fund and such distribution,
withdrawal or loan does not represent 100% of the Participant's interest in the
Plan, be taken from each investment fund(s) specified by the Participant.
13.7 Direct Rollover Distributions. Notwithstanding any
provision of the Plan to the contrary that would otherwise limit a
distributee's election under this Section 13.7, a distributee may elect, at the
time and in the manner prescribed by the plan administrator, to have any
portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover.
Eligible rollover distribution: An eligible rollover
distribution is any distribution of all or any portion of the balance to the
credit of the distributee, except that an eligible rollover distribution does
not include: any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life (or
life expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated beneficiary,
or for a specified period of ten years or more; any distribution to the extent
such distribution is required under Code Section 401(a)(9); and the portion of
any distribution that is not includable in gross income (determined without
regard to the exclusion for net unrealized appreciation with respect to
employer securities).
Eligible retirement plan: An eligible retirement plan is an
individual retirement account described in Code Section
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408(a), an individual retirement annuity described in Code Section 408(b), an
annuity plan described in Code Section 403(a), or a qualified trust described
in Code Section 401(a), that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible rollover distribution to the
surviving spouse, an eligible retirement plan is an individual retirement
account or individual retirement annuity.
Distributee: A distributee includes an employee or former employee.
In addition, the employee's or former employee's surviving spouse and the
employee's or former employee's spouse or former spouse who is the alternate
payee under a qualified domestic relations order, as defined in Code Section
414(p), are distributees with regard to the interest of the spouse or former
spouse.
Direct rollover: A direct rollover is a payment by the plan to the
eligible retirement plan specified by the distributee.
13.8 30-Day Waiver. If a distribution is one to which Code
Sections 401(a)(11) and 417 do not apply, such distribution may commence less
than thirty days after the notice required under Section 1.411(a)-11(c) of the
Income Tax Regulations is given, provided that:
(1) the plan administrator clearly informs the
Participant that the Participant has a right to a period of
at least thirty days after receiving the notice to consider
the decision of whether or not to elect a distribution (and,
if applicable, a particular distribution option), and
(2) the Participant, after receiving the notice,
affirmatively elects a distribution.
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SECTION XIV
PROVISIONS CONCERNING PAYMENT OF BENEFITS
14.1 Medium of Withdrawals/Distributions. Withdrawals and
distributions shall be made by check, except to the extent that the Participant
(or Beneficiary) requests a withdrawal or distribution from the Company Stock
Fund be made in shares of Company Stock.
14.2 Time of Distribution. Subject to Section 13.1, all
distributions shall be made or commence as soon as practicable and in any event
shall begin within sixty days after the end of the later of the Plan Year in
which the Participant reaches age 65 or terminates employment; provided,
however, in all events distribution must be made or commence prior to April 1
following the calendar year in which a Participant reaches age 70 1/2,
regardless of whether he has then terminated employment. The required minimum
distribution shall be the balance of the Participant's Accounts as of the end
of the calendar year preceding the applicable "distribution year" (as defined
in the regulations) divided by the Participant's applicable life expectancy
(without redetermination), less any withdrawals made by the Participant during
such year. The required minimum distribution as described above shall be the
automatic form paid under the Plan in a single sum with respect to each
distribution year.
Further, distribution due to the death of a Participant
shall be paid in full to his Beneficiary within 60 months of his date of death.
Notwithstanding anything to the contrary, the provisions of Code Section
401(a)(9), including Reg. Section 1.401(a)(9)-2, are hereby incorporated by
reference and shall control over any provision in conflict therewith.
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14.3 Designation of Beneficiaries. The Employee's application to
become a Participant shall designate one or more Beneficiaries to receive
benefits arising under the Plan in the event of his death; however, if the
Participant is married, then notwithstanding a designation to the contrary, the
Participant's spouse shall automatically be his sole primary Beneficiary under
the Plan unless such spouse consents in writing to the designation of another
person as a Beneficiary which designation is specific as to the person and, if
applicable, form of benefit, acknowledges in such consent the effect of such
designation on the spouse's right to benefits under the Plan, and such spousal
consent is witnessed by a notary public, except where such requirement is
waived by the Treasury Regulations, and the designation cannot be modified
without a new spousal consent. Designated Beneficiaries may include the estate
of the Participant, persons who are the natural objects of the Participant's
bounty and any persons designated by the Participant to share in the benefits
of the Plan after the death of the Participant. If more than one person is
named, the Participant must indicate the shares and/or precedence of each
person. Subject to the above spousal consent, a Participant may change his
designated Beneficiaries from time to time without notice to or consent of any
Beneficiary; however, any changes by a married Participant will require a new
spousal consent. Any designation of Beneficiaries ("Designation") and any
revocation or change thereof shall be made in writing in such form as the
Committee may from time to time prescribe and shall be effective when filed
with the Committee; provided, however, a Participant's marriage subsequent to a
Designation shall automatically revoke all Designations theretofore filed by
such Participant and a divorce shall automatically revoke a designation of that
former spouse as a Beneficiary of the Participant, except as otherwise provided
in a qualified domestic relations order.
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If no Designation is in effect upon the death of a
Participant, then any benefit payment which would otherwise be payable to the
Beneficiaries designated by such Participant shall be paid to the person
constituting his first surviving class of the following classes:
(a) surviving spouse;
(b) the estate of such Participant;
upon receipt by the Committee of proof satisfactory to it that such person
constitutes the first such surviving class.
If under the foregoing provisions of this Section 14.3, a
payment is made to a Participant or Beneficiary, such payment shall be a
complete discharge of any liability of the Plan and Trust to such Participant
or Beneficiary and shall be a complete settlement of any claim, right or
interest in or to such payment.
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SECTION XV
SPECIAL PAYMENT PROVISIONS
15.1 Payments to Minors and Incompetents. If any person entitled
to receive any benefits hereunder is legally incompetent by reason of minority
or otherwise, the Committee may instruct the Trustee to make distribution to
the parent(s) or legal guardian(s) of such person, and such distribution shall
constitute a complete discharge of all liability with respect to such benefit.
15.2 Non-Assignability of Rights. Except for the right of a
Participant to name one or more Beneficiaries to receive distribution of
benefits upon death of a Participant or as otherwise provided by a qualified
domestic relations order, as defined in Code Section 414(p), or other
applicable law, none of the benefits, payments, proceeds, claims or rights of
any person is or may become entitled to receive under the Plan, contingently or
otherwise, shall be subject, through legal or equitable proceedings or
otherwise, to any claim of any creditor of any such person prior to actual
receipt thereof by such person, nor shall any such person have any right to
assign, anticipate, transfer or encumber any of the benefits, payments,
proceeds, claims or rights he may expect to receive, contingently or otherwise,
under this Plan, and any such attempted assignment, anticipation, transfer or
encumbrance shall be wholly and absolutely void. An alternate payee under a
qualified domestic relations order ("QDRO") may receive a distribution pursuant
to the QDRO at any time, irrespective of whether the Participant has attained
his earliest retirement age under the Plan, as defined in Code Section 414(p),
provided the order specifies distribution at that time or permits an agreement
between the Plan and the alternate payee to authorize an earlier distribution.
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SECTION XVI
ASSOCIATED COMPANIES
16.1 Adoption of Plan. Any Affiliate which the Board shall
designate an "Associated Company" and declare eligible to adopt and participate
in the Plan may adopt and become a party to this Plan and the Trust Agreement
provided for herein subject to and upon such terms and conditions as the Board
may prescribe, including, without limitation, conditions as to:
(a) the instruments to be executed and delivered by
such Associated Company to the Trustee and to the Company;
(b) the extent to which the Company shall act as agent
or representative of such Associated Company under the Plan; and
(c) authorization to the Company to act for such
Associated Company and its employees who are Participants under the
Plan.
The Plan shall be effective with respect to each adopting Associated Company
and its Employees on such date as shall be approved by the Board and specified
in the instruments executed by such Associated Company adopting the Plan.
Upon adoption of the Plan by an Associated Company in
accordance with the provisions of this Section 16.1, such Associated Company
and its Employees shall thereupon be governed and bound by all the terms and
provisions of the Plan, subject to the terms and conditions upon which such
Associated Company adopted the Plan, and, so long as such Associated Company
shall continue its participation in the Plan, it shall be an Employer
hereunder.
16.2 Withdrawal from Plan. Any Employer (other than the Company)
shall have the right to withdraw from the Plan effective at the end of any
calendar month by giving at least 60 days' prior
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written notice to the Company and the Trustee. Upon any such withdrawal, the
Trustee shall value the assets of the trust fund of the Trust as though such
withdrawal date were a Valuation Date and the Current Balances of all the
Participant Accounts shall be calculated as provided in Section X. The Trustee
shall then set apart that portion of such trust fund which, as certified by the
Committee, is attributable to the Participant Accounts of the Participants who
are employees of such withdrawing Employer, plus any contributions of such
Employer not previously allocated to such Participants' Accounts. That portion
of the trust fund of the Trust so set apart shall continue to be held by the
Trustee in trust under the terms and provisions of the Trust Agreement as
though such withdrawing Employer had entered into such Trust Agreement with the
Trustee as its own separate trust agreement, and such Employer shall be deemed
to have thereupon adopted the Plan as its own separate plan and shall have and
may exercise all of the rights, powers and authorities of the Company under the
Plan and Trust Agreement.
Upon withdrawal of an Associated Company from the Plan, it
shall cease to be an Employer under this Plan and shall not be eligible to
again adopt and participate in this Plan unless it is again designated an
"Associated Company" pursuant to Section 16.1.
16.3 Termination of Employer Participation by Company. The
Company may, in its absolute discretion, terminate the participation of any
other Employer in the Plan effective at the end of any calendar month by giving
at least 60 days' prior written notice to such Employer, the Committee and the
Trustee. Any such termination of participation of an Employer shall have the
same effect as a voluntary withdrawal by such Employer pursuant to Section
16.2, and the procedures set forth in and the provisions of such section shall
be applicable.
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SECTION XVII
AMENDMENT AND TERMINATION
17.1 Right to Amend or Terminate. It is the intention of the
Company by its adoption hereof to create a permanent thrift plan and to
continue to make contributions hereunder indefinitely; nevertheless
(a) the Company, by action of the Board, reserves and
shall have the right at any time and from time to time to discontinue
or terminate the Employers' liability to make contributions hereunder
or to reduce or suspend such contributions for a fixed, indeterminate
or temporary period of time;
(b) the Company, by action of the Board, reserves and
shall have the right to amend the Plan (including any Trust Agreement
which forms a part hereof) in whole or in part at any time and from
time to time and also has authorized and empowered the Committee to
amend Attachment A of the Plan as provided in Section 8.1; provided,
however, no such amendment or change shall adversely affect the
Company's indemnification of the members of the Committee under
Section III; and
(c) the Company, by action of the Board, reserves and
shall have the right to terminate the Plan in its entirety at any
time, and such action by the Company shall be binding upon all
Employers and their employees.
In addition, the Committee shall be authorized and empowered
to make any amendments to the Plan of a ministerial nature or which may be
required to maintain the qualified status of the Plan under the Code; provided,
however, the Committee shall not be authorized to make any amendment that would
change the
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Employers' contribution obligations or significantly increase the
administrative costs of the Plan or Trust.
Written notice of any such action by the Company shall be
given to the Committee, the Trustee and the Participants affected thereby,
specifying the effective date thereof, and any such action shall be evidenced
by an instrument in writing, duly executed by the Company and shall be filed
with the Committee and the Trustee. Each amendment of the Plan by the Company
shall be binding on each other Employer. Amendments by the Committee shall be
similarly effectuated. Any amendment of the Plan may be made effective
retroactively if it would be beneficial to the Participants to do so or such
amendment is necessary or advisable in order to comply with the provisions of
the Code or any rulings or regulations issued thereunder pertaining to employee
profit sharing, stock bonus or ESOP plans and trusts.
17.2 Restrictions on Amendment. The rights of the Employers and
the Company under Section 17.1 are specifically subject to the restrictions
contained in this Section 17.2. No amendment, change or modification shall be
made in the Plan (including any Trust Agreement which forms a part hereof)
which will adversely change the vesting schedule with respect to any
Participant who has three or more years of service, or eliminate any "protected
benefit", other than as may be permitted by regulations, or which will give any
Employer any rights in funds contributed to the Trust or in any assets of the
Trust or which will, without its consent, increase the duties or liabilities of
the Trustee.
17.3 Effect of Dissolution or Merger. This Plan shall
automatically terminate as to an Employer upon the legal dissolution of such
Employer, upon the making of a general assignment for the benefit of its
creditors, or upon expiration or forfeiture of its corporate charter. It shall
likewise terminate
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as to an Employer upon the merger, consolidation or reorganization of such
Employer with any other corporation(s) or other business organization(s) unless
such Employer is a surviving corporation or such other corporation(s) or
business organization(s) shall, by instrument in writing filed with the
Committee and the Trustee prior to the effective date of such merger,
consolidation or reorganization, assume the obligations of such Employer
hereunder. Written notice of any such automatic termination shall be given to
the Trustee by the Committee.
17.4 Effect of Merger, Consolidation or Transfer Of Assets. If
this Plan is merged or consolidated with any other plan, or its assets or
liabilities are transferred to any other plan, each Participant shall be
entitled to a benefit immediately after the merger, consolidation or transfer
at least equal to the benefit he would have received if he had been entitled to
a benefit immediately preceding the merger, consolidation or transfer and the
Plan had then terminated.
17.5 Expiration of Trust Term. If this Plan shall not have
theretofore been terminated under the provisions hereof, it shall finally
terminate upon expiration of the Trust term.
17.6 Distribution Upon Termination of Plan. As of the date of
termination of this Plan (other than by reason of the payment and distribution
of all funds held in the Trust), the trust fund of the Trust shall be revalued
as if such date were a Valuation Date and the Current Balances of all Accounts
shall be calculated in accordance with Section X. Upon termination of the
Plan, and prior to making any distributions from the Plan in connection
therewith, the Company shall notify the appropriate District Director of the
Internal Revenue Service that the Plan has been terminated and shall obtain a
ruling from such District Director as to the effect of such termination. The
Committee shall then instruct the
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Trustee, after all obligations to and incurred by it have been paid and
allocated to the Participant's Accounts as provided by the Trust Agreement, to
distribute to each Participant, or his beneficiary or beneficiaries, the full
amount then standing to the credit of his Accounts, such distribution to be
made in accordance with Section XIV, and subject to the consent requirements of
Section XIII, unless regulations provide otherwise.
17.7 Consent for Alternate Forms of Benefit. Notwithstanding
anything in the Plan to the contrary, any Plan provision that restricts or
denies a Participant through the withholding of consent or the exercise of
discretion by some person(s) other than the Participant of an "alternate form
of benefit" is null and void. An "alternate form of benefit" encompasses the
forms of benefit which provide that (a) a Participant's benefits may be paid in
more than one form or (b) payment of a particular form of benefit may commence
at some earlier or later than normal date for the commencement of such benefit.
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SECTION XVIII
TOP-HEAVY RULES
18.1 Top-Heavy Provisions. The following provisions are to be
applied to determine if the Plan is top-heavy within the meaning of Code
Section 416 and the consequences if it is so determined. Solely for the
purpose of determining if the Plan, or any other plan included in a required
aggregation group of which this Plan is a part, is top-heavy (within the
meaning of Code Section 416(g)) the accrued benefit of an Employee other than a
key employee (within the meaning of Code Section 416(i)(1)) shall be determined
under (a) the method, if any, that uniformly applies for accrual purposes under
all plans maintained by the Affiliated Employers, or (b) if there is no such
method, as if such benefit accrued not more rapidly than the slowest accrual
rate permitted under the fractional accrual rule of Code Section 411(b)(1)(C).
18.2 Determination of Whether the Plan is Top-Heavy.
(a) Top-Heavy Ratio. The Plan shall be top-heavy for a Plan
Year if the current balance of the Accounts under the Plan for "key employees"
(as defined below), excluding the Accounts of a Participant who is not a key
employee in the year of determination but was in a prior year, exceeds 60% of
the current balance of the Accounts of all Participants as of a Determination
Date. The "top-heavy ratio" shall be determined in accordance with Code
Section 416(g). In determining the current balance under the Plan, all
distributions made during the Plan Year of the determination plus the four
preceding Plan Years shall be included. However, the accounts of any
Participant who has performed no services for the Employer during the five-year
test period shall be disregarded.
(b) Plans to be Aggregated. For purposes of determining whether
the Plan is top-heavy, plans of the Employers and
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Affiliates in which a key employee participates and each other plan of the
Employers and Affiliates which enables any such plan to meet the requirements
of Code Sections 401(a)(4) or 410 shall be aggregated in determining whether
the Plan and such plan(s) are top-heavy (the Required Aggregation Group).
However, the Employer may treat any other plan as part of such group if such
group would continue to meet the requirements of Code Sections 401(a)(4) and
410 (the Permissive Aggregation Group).
(c) Key Employees. A key employee is any Employee or former
Employee Participant (or Beneficiary thereof) in an Employer plan who, at any
time during the Plan Year or any of the four preceding Plan Years, is (i) an
officer of the Employer having annual compensation from the Employer for a Plan
Year greater than 50% of the dollar limitation in effect under Code Section
415(b)(1)(A) for the calendar year in which such Plan Year ends, (ii) one of
the 10 employees owning both the largest interests in the Employer and a
greater than 1/2% interest and receiving compensation from the Employer greater
than the dollar limitation in effect under Code Section 415(c)(1)(A) for the
calendar year in which such Plan Year ends, (iii) a 5% owner of the Employer,
or (iv) a 1% owner of the Employer receiving annual compensation of more than
$150,000 from the Employer. The number of officers who are key employees shall
be limited as provided in Code Section 416(i)(1). An Employee who is not a key
employee shall be a non-key employee.
(d) Determination Date. The Determination Date shall be the
last day of the preceding Plan Year.
18.3 If the Plan is Top-Heavy.
(a) Minimum Contribution. For each year the Plan is top-heavy,
each Employee in the Eligible Class shall receive an Employer contribution
equal to the greater of (i) his Employer matching contribution for that Plan
Year under the Plan, or (ii) a
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top-heavy contribution equal to the lesser of (A) 3% of the Participant's
compensation, or (B) the percentage at which Employer matching contributions
are made for the key employee with the highest percentage. If the highest rate
allocated to a key employee for a year in which the Plan is top-heavy is less
than 3%, amounts contributed as a result of a salary reduction agreement must
be included in determining contributions made on behalf of key employees.
Further, in the event the Participant also participates in a defined benefit
plan of the Employer or an Affiliate that is top-heavy, the Participant shall
receive the minimum top-heavy contribution provided above and shall not accrue
the minimum top-heavy benefit required under such other plan. For purposes of
this Section XVIII, the term "compensation" shall mean the compensation stated
on the employee's Form W-2 for the calendar year in which the Plan Year ends.
18.4 Super Top-Heavy Provision. In determining whether the Plan
is super top-heavy for any Plan Year, the rules above shall apply with the
following exceptions:
1. In determining the super top-heavy ratio, 90%
shall be substituted for 60%, and
2. In computing the denominators of the defined
benefit and defined contributions fractions under Code Section 415(e),
a factor of 1.0 shall be used instead of 1.25.
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SECTION XIX
ANTIDISCRIMINATION TESTS
19.1 Special Definitions.
(a) Family Member. An individual included in
the following group: an Employee's or former Employee's spouse, lineal
ascendants or descendants, or the spouses of such lineal ascendants or
descendants.
(b) Highly Compensated Participant. The term
Highly Compensated Participant includes Highly Compensated active employees and
Highly Compensated former employees. Highly Compensated Participants shall be
determined separately with respect to the group of Highly Compensated active
employees and Highly Compensated former employees who are not members or former
members of a collective bargaining unit(s) for which participation in the Plan
is or was the subject of collective bargaining and the group of such active and
former employees who are members or former members of such a collective
bargaining unit(s).
A Highly Compensated active employee includes any
employee who performs service for an Employer during the determination year and
who, during the look-back year: (l) received Total Compensation from an
Employer in excess of $75,000 (as adjusted pursuant to Code Section 415(d));
(ii) received Total Compensation from an Employer in excess of $50,000 (as
adjusted pursuant to Code Section 415(d)) and was a member of the top-paid
group for such year; or (iii) was an officer of an Employer and received Total
Compensation during such year that is greater than 50% of the dollar limitation
in effect under Code Section 415(b)(1)(A). Highly Compensated Participant also
includes: (i) Employees who are both described in the preceding sentence if the
term "determination year" is substituted for the term "look-
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back year" and the Employee is one of the 100 Employees who received the most
Total Compensation from the Affiliates during the determination year; and (ii)
Employees who are five percent owners at any time during the look-back year or
determination year.
If no officer has satisfied the Total Compensation
requirement of (iii) above during either a determination year or look-back
year, the highest paid officer for such year shall be treated as a Highly
Compensated Participant.
For this purpose, the determination year shall be
the Plan Year. The look-back year shall be the 12-month period immediately
preceding the determination year, or, if elected by the Committee, the same
Plan Year as the determination year.
A Highly Compensated former employee includes any
Employee who separated from service (or was deemed to have separated) prior to
the determination year, performs no service for an Employer during the
determination year, and was a Highly Compensated active employee for either the
separation year or any determination year ending on or after the Employee's
55th birthday.
If an Employee is, during a determination year or
look-back year, a Family Member of either a five percent owner who is an active
or former Employee or a Highly Compensated Participant who is one of the 10
most Highly Compensated Participants ranked on the basis of Total Compensation
paid by Affiliates during such year, then the Family Member and the five
percent owner or top-ten highly compensated employee shall be aggregated. In
such case, the Family Member and five percent owner or top-ten highly
compensated employee shall be treated as a single employee receiving Total
Compensation and Plan contributions or benefits equal to the sum of such Total
Compensation and contributions or benefits of the Family Member and five
percent owner or top-ten highly compensated employee.
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The determination of who is a Highly Compensated
Participant, including the determination of the number and identity of
employees in the top-paid group, the top 100 employees, the number of employees
treated as officers and the compensation that is considered, will be made in
accordance with Code Section 414(q) and the regulations thereunder.
(c) Non-Highly Compensated Participant. Any
Participant or former Participant who is neither a Highly Compensated
Participant nor a Family Member of a Highly Compensated Participant.
Non-Highly Compensated Participants shall be determined separately with respect
to Participants and former participants who are not members or former members
of a collective bargaining unit(s) for which participation in the Plan is or
was the subject of collective bargaining and the group of such Participants and
former participants [insert not legible].
(d) Total Compensation. For purposes of this
Section XIX, Total Compensation shall mean, for any Plan Year, one of the
following: (1) the Code Section 415(d)(2) amount, i.e., compensation shall
include only the following: (i) the Employee's wages, salaries, fees for
professional services, and other amounts received (without regard to whether or
not an amount is paid in cash) for personal services actually rendered in the
course of employment with an Employer maintaining the Plan to the extent that
the amounts are includable in gross income (including, but not limited to,
commissions paid salesmen, compensation for services on the basis of a
percentage of profits, commissions on insurance premiums, tips, bonuses, fringe
benefits, and reimbursements or other expense allowances under a non-
accountable plan (as described in Code Section 1.62-2(c)), (ii) amounts
described in Code Sections 104(a)(3), 105(a), and 105(h), but only to the
extent that these amounts are includable in the gross income of the Employee,
(iii)
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amounts paid or reimbursed by the employer for moving expenses incurred by an
Employee, but only to the extent that at the time of the payment it is
reasonable to believe that these amounts are not deductible by the Employee
under Code Section 217, (iv) the value of a non-qualified stock option granted
to an Employee by an Employer, but only to the extent that the value of the
option is includable in the gross income of the Employee for the taxable year
in which granted; and (v) the amount includable in the gross income of an
Employee upon making the election described in Code Section 83(b); (2) the Code
Section 415(d)(11)(i) amount, i.e., wages within the meaning of Code Section
3401(a) and all other payments of compensation to an Employee by his Employer
(in the course of the Employer's trade or business) for which the Employer is
required to furnish the Employee a written statement under Code Sections
6041(d) and 6051(a)(3). This definition of compensation may be modified to
exclude amounts paid or reimbursed by the Employer for moving expenses incurred
by an Employee, but only to the extent that at the time of the payment it is
reasonable to believe that these amounts are deductible by the Employee under
Code Section 217. Compensation under Code Section 415(d)(11)(i) must be
determined without regard to any rules under Code Section 3401(a) that limit
the remuneration included in wages based on the nature or location of the
employment or the services performed (such as the exception for agricultural
labor in Code Section 3401(a)(2); (3) the Code Section 415(d)(11)(ii) amount,
i.e., wages within the meaning of Code Section 3401(a) (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 (such as the exception for agricultural
labor in Code Section 3401(a)(2); or (4) any other safe harbor definition under
Code
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Section 414(s). Whichever definition of Total Compensation is selected by the
Committee as being applicable for that period of determination must be used
consistently for all Employees for all purposes that refer to Code Section
414(s), e.g., for Code Section 401(a)(4) purposes, and whichever definition is
applicable shall also include all elective contributions made by an Employer on
behalf of its Employees that are not includable in gross income under Code
Sections 125, 402(a)(8) and 402(h).
19.2 401(k) Contributions.
(a) A Participant's 401(k) Contributions made shall
not exceed $9,240 for the taxable year of the Participant. This dollar
limitation shall be adjusted annually as provided in Code Section 415(d)
pursuant to Regulations. The adjusted limitation shall be effective as of
January 1 of each calendar year.
(b) In the event that the dollar limitation
provided for in Section 19.2(a) is exceeded, the Committee shall direct the
Trustee to distribute such excess amount, and any income (or loss) allocable to
such amount (as provided in (d) below), to the Participant not later than the
first April 15 following the close of the Participant's taxable year.
(c) In the event that a Participant is also a
participant in (1) another qualified cash or deferred arrangement (as defined
in Code Section 401(k)), (2) a simplified employee pension (as defined in Code
Section 408(k)), or (3) a salary reduction arrangement (within the meaning of
Code Section 3121(a)(5)(D)) and the elective deferrals, as defined in Code
Section 402(g)(3), made under such other arrangement(s) and this Plan
cumulatively exceed $9,240 (or such amount adjusted annually as provided in
Code Section 415(d) pursuant to Regulations) for such Participant's taxable
year, the Participant may, not later than March 1 following the close of his
taxable year, notify the
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Committee in writing of such excess and request that his 401(k) contribution
under this Plan be reduced by an amount specified by the Participant. Such
amount shall then be distributed in the same manner as provided in Section
19.2(b).
(d) The income (or loss) allocable to returnable
contributions shall equal the sum of 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 stocks, bonds, annuity and life insurance
contracts, and other property, without regard to whether such appreciation has
been realized.
The income (or loss) allocable to returnable
contributions for the Plan Year is determined by multiplying the income (or
loss) for the Plan Year allocable to employee contributions, matching
contributions, and amounts treated as matching contributions (whichever is
applicable) by a fraction. The numerator of the fraction is the amount of
returnable contributions made on behalf of the Employee for the Plan Year. The
denominator of the fraction is the total account balance of the Employee
attributable to employee contributions, matching contributions and amounts
treated as matching contributions as to the end of the Plan Year, reduced by
the gain allocable to such total amount for the Plan Year and increased by the
loss allocable to such total amount for the Plan Year.
19.3 Actual Deferral Percentage.
For purposes of this Section XIX, "Actual Deferral
Percentage" means, with respect to the Highly Compensated Participant groups
and the Non-Highly Compensated Participant groups for a Plan Year, the average
of the ratios, calculated separately for each Participant in each such group,
of the amount of 401(k) contributions allocated to each Participant's 401(k)
XIX-6
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Account (unreduced by distributions made pursuant to Sections 19.2(b) and
19.2(d) for such Plan Year), to such Participant's Total Compensation for such
Plan Year. For the purpose of determining the "Actual Deferral Percentage" of
a Highly Compensated Participant, the 401(k) Contributions and compensation of
such Highly Compensated Participant shall include the 401(k) Contributions and
Total Compensation of Family Members, and such affected Family Members shall be
disregarded in determining the "Actual Deferral Percentage" for the affected
Non-Highly Compensated Participant group.
19.4 Actual Deferral Percentage Test.
(a) Maximum Annual Allocation: For each Plan Year,
the annual allocation derived from 401(k) contributions to the Highly
Compensated Participants' 401(k) Accounts shall satisfy one of the following
tests:
(1) The "Actual Deferral Percentage" for each
respective Highly Compensated Participant group shall not be more than
the "Actual Deferral Percentage" of the related Non-Highly Compensated
Participant group multiplied by 1.25, or
(2) The excess of the "Actual Deferral
Percentage" for each respective Highly Compensated Participant group
over the "Actual Deferral Percentage" for the related Non-Highly
Compensated Participant group shall not be more than two percentage
points. Additionally, the "Actual Deferral Percentage" for the Highly
Compensated Participant group shall not exceed the "Actual Deferral
Percentage" for the Non-Highly Compensated Participant group
multiplied by two. However, this alternative limitation test cannot
be used to satisfy both the Actual Deferral Percentage test and the
Average Contribution Percentage Test of Section 19.6 for the same Plan
Year for the non-collectively bargaining groups, except as may
XIX-7
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otherwise be provided by the Regulations. The alternative limitation
test shall not be applicable to the collectively-bargaining groups.
(b) For the purposes of Sections 19.4(a) and 19.5,
a Highly Compensated Participant and a Non-Highly Compensated Participant shall
include any Employee eligible to make a salary deferral election, whether or
not such salary deferral election was made.
(c) For the purposes of this Section XIX, if two or
more plans which include cash or deferred arrangements are considered one plan
for the purposes of Code Section 401(a)(4) or 410(b), the cash or deferred
arrangements included in such plans shall be treated as one arrangement.
(d) For the purposes of this Section XIX, if a
Highly Compensated Participant is a member under two or more cash or deferred
arrangements of an Affiliate, all such cash or deferred arrangements shall be
treated as one cash or deferred arrangement for the purpose of determining the
deferral percentage with respect to such Highly Compensated Participant.
19.5 Adjustments as a Result of Actual Deferral Percentage Test.
In the event that the initial allocations of the
401(k) Contributions made pursuant to the Plan do not satisfy one of the tests
set forth in Section 19.4(a), the Committee shall adjust the 401(k)
Contributions of the Highly Compensated Participants pursuant to one of the
options set forth below:
(a) On or before the 15th day of the third month
following the end of each Plan Year, but in no event later than the close of
the following Plan Year, each Highly Compensated Participant, beginning with
the Participant having the highest "Actual Deferral Percentage", shall have his
portion of excess
XIX-8
<PAGE> 80
401(k) Contributions (and any income allocable to such portion as provided in
(d) of Section 19.2) distributed to him until one of the tests set forth in
Section 19.4(a) is satisfied. However, to the extent provided by regulations,
each affected Highly Compensated Participant shall first be given the election
to treat such excess 401(k) Contribution as an after-tax Participant
contribution, subject to the limitations of Section 19.6, and if elected, the
excess amount (and any income allocable thereto as provided above) shall be
deemed to be a Participant contribution and allocated to the Participant's
After-Tax Contribution Account as a subaccount, but such subaccount shall be
subject to the same restrictions on withdrawals and distributions as are
applicable to 401(k) Contributions, but may not be withdrawn due to a financial
hardship; or
(b) The Employer may make a qualified matching
contribution to one or more nondiscriminatory classes of Participants as
necessary to satisfy one of the tests set forth in Section 19.4(a).
19.6 Maximum Average Contribution Percentage.
(a) The "Average Contribution Percentage" for the
non-collectively bargaining Highly Compensated Participant group shall not
exceed the greater of:
(1) 125% of such percentage for the
related Non-Highly Compensated Participant group;
or
(2) the lesser of 200% of such
percentage for the related Non-Highly Compensated
Participant group, or such percentage for the
Non-Highly Compensated Participant group plus two
percentage points, or such lesser amount determined
pursuant to Regulations to prevent the multiple use
of this
XIX-9
<PAGE> 81
alternative limitation with respect to any Highly
Compensated Participant.
(b) For the purposes of this Section XIX, "Average
Contribution Percentage" for a Plan Year means, with respect to the Highly
Compensated Participant group and Non-Highly Compensated Participant group, the
average of the ratios (calculated separately for each Participant in each
group) of:
(1) the sum of the matching Employer Matching
Cash Contributions and Participant After-Tax Contributions
contributed under the Plan on behalf of each such
Participant for such Plan Year to
(2) the Participant's Total Compensation for
such Plan Year.
(c) The "Average Contribution Percentage" for a
Highly Compensated Participant shall be determined by including Employer
Matching Cash Contributions (other than Qualified Matching Contributions) and
Participant After-Tax Contributions and Total Compensation of Family Members
and such Family Members shall be disregarded in determining the "Average
Contribution Percentage" of Non-Highly Compensated Participants.
(d) If two or more plans of the Employer to which
matching contributions, Employee contributions, or elective deferrals are made
are treated as one plan for purposes of Code Section 410(b), such plans shall
be treated as one plan for purposes of this Section 19.6. In addition, if a
Highly Compensated Participant participates in two or more plans described in
Code Section 401(a) or arrangements described in Code Section 401(k) which are
maintained by the Employer to which such contributions are made, all such
contributions shall be aggregated for purposes of this Section 19.6.
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<PAGE> 82
(e) For purposes of Section 19.6(a) and 19.7, a
Highly Compensated Participant and Non-Highly Compensated Participant shall
include any Employee eligible to have Employer Matching Cash Contributions and
Participant After-Tax Contributions allocated to his Accounts for the Plan
Year.
(f) The "Average Contribution Percentage" test
shall not be applicable to the collectively-bargaining groups of Highly
Compensated Participants and Non-Highly Compensated Participants [not legible].
19.7 Adjustments for Excessive Contribution Percentage.
(a) In the event that the "Average Contribution
Percentage" for the Highly Compensated Participant group exceeds the "Average
Contribution Percentage" for the Non-Highly Compensated Participant group
pursuant to Section 19.6(a), the Committee (on or before the 15th day of the
third month following the end of the Plan Year, but in no event later than the
close of the following Plan Year) shall direct the Trustee to distribute to the
Highly Compensated Participant group the amount of "Excess Aggregate
Contributions" (and any income allocable to such contributions as provided in
Section 19.2(d); provided, however, a matching contribution may be distributed
only if such contribution is an excess aggregate contribution. It may not be
distributed merely because it relates to an excess deferral, an excess
contribution or an excess aggregate contribution that is distributed. In such
cases, the related matching contribution shall be forfeited notwithstanding
anything in the Plan to the contrary. Such distribution shall be made on
behalf of the Highly Compensated Participant group in order of their "Average
Contribution Percentages", beginning with the highest of such percentages.
However, no forfeiture may be allocated to a Highly
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<PAGE> 83
Compensated Participant whose contributions are reduced pursuant to this
Section 19.7.
(b) For the purposes of this Section 19.7, "Excess
Aggregate Contributions" means, with respect to any Plan Year, the excess of:
(1) the aggregate amount of
contributions determined pursuant to Sections
19.6(b)(1) and 19.6(c) actually made on behalf of
the Highly Compensated Participant group for such
Plan Year, over
(2) the maximum amount of such
contributions permitted under the limitations of
Section 19.6(a).
(c) The determination of the amount of "Excess
Aggregate Contributions" with respect to any Plan Year shall be made
after:
(1) first determining the excess
contributions pursuant to Section 19.2(a), and
(2) then determining the excess annual
allocations pursuant to Section 19.4(a).
XIX-12
<PAGE> 84
SECTION XX
GENERAL PROVISIONS
20.1 Employer's Rights. The Employers rights to discipline,
transfer, discharge or terminate the employment of Employees, or to exercise
their rights as to incidents and tenure of employment, shall not be impaired or
affected in any manner by reason of the existence of the Plan or any action
taken under the Plan.
20.2 Notice of Address. Each Participant and each other person
receiving or eligible to receive benefits under the Plan shall file with his
Employer notice in writing of his post office address and each change of post
office address. Any notice, statement or other communication addressed to any
person at his last post office address filed with the Employer, or if no post
office address was filed with the Employer by such person, then at the last
post office address of the Participant by reason of whose employment such
benefit is payable as shown by the Employer's records, shall be binding upon
such person for all purposes of the Plan. Neither the Committee, the Employers
nor the Trustee shall be required or obligated to search for or ascertain the
whereabouts of any person eligible to receive benefits under the Plan.
20.3 Copies of Plan Available. Copies of the Plan and any and
all amendments thereto shall be made available at all reasonable times to all
Employees of an Employer at the office of such Employer designated by the
Committee.
20.4 Titles and Heading. The titles to and headings of Sections
in the Plan are for convenience and reference only, and, in the event of any
conflict, the text of the Plan rather than such titles or headings shall
control.
20.5 Counterparts. This Plan and all amendments thereto may be
executed in any number of counterparts, each of which shall be
XX-1
<PAGE> 85
deemed an original, and said counterparts shall constitute but one and the same
instrument which may be sufficiently evidenced by any one counterpart.
20.6 Applicable Law. This Plan is created under and shall be
governed, construed and administered in accordance with the laws of the State
of Kentucky, except to the extent preempted by ERISA.
20.7 Unclaimed Benefits. Any benefit payable to or on behalf of a
Participant or Beneficiary which is not claimed after reasonable efforts to
locate such person have been made shall be forfeited and used to reduce future
Company contributions to be made to the Plan. If the Participant or his
Beneficiary subsequently presents a valid claim for benefits to the Committee,
the Company shall cause such forfeited benefit to be restored, unadjusted for
interim Trust fund gains or losses, from current forfeitures or additional
Company contributions to the Plan.
IN WITNESS WHEREOF, the Company has caused its duly authorized officer
to affix its name hereto on this _____ day of ___________, 1995, effective for
all purposes as provided herein.
ATTEST: TEXAS GAS TRANSMISSION
CORPORATION
_________________________________ By:_____________________________
SECRETARY Name:___________________________
Title:__________________________
XX-2
<PAGE> 86
ATTACHMENT A
TEXAS GAS THRIFT PLAN
I. Investment Funds
Fund A: Retirement Government Money Market
Fund B: Company Stock Fund
Fund C: Puritan Fund
Fund D: Magellan Fund
Fund E: Fixed Income Fund
Fund F: Contrafund
Fund G: OTC Portfolio
Fund H: Overseas Portfolio
Fund I: Asset Manager
Fund J: Asset Manager-Growth
Fund K: Asset Manager-Income
II. Fund Transfer Restrictions
No direct transfers from Fund E to Fund A may be made and any
transfers from Fund E to any of the other Funds may not be retransferred from
such Fund(s) to Fund A within 90 days of the date of such initial transfer from
Fund E. Subject to the above, transactions into and out of a fund shall be
effectuated daily, with the exception that transactions into and out of Fund B
shall be effectuated one per week.
III. Default Election
If a Participant fails to timely give an investment direction
to the Trustee with respect to his Accounts, his Accounts shall be invested in
Fund A until the Trustee receives a proper investment direction from the
Participant.
IV. Temporary Freeze on New Investments in Fund B
During the period from the close of business on December 16,
1994, until the consummation of the Merger, as defined in the Agreement and
Plan of Merger dated as of December 12, 1994, by and among The Williams
Companies, Inc. ("Williams"), WC Acquisition Corp. and the Company (the "Merger
Agreement"), or the termination of the Merger Agreement without the
consummation of the Merger, no transfers from other investment funds into the
Company Stock Fund
<PAGE> 87
will be permitted and new contributions made directly to the Company Stock Fund
will be temporarily invested in Option A, but fully and separately accounted
for under the Company Stock Fund pending the consummation of the Merger. Upon
the consummation of the Merger, the Company Stock Fund will become a fund
invested in common stock of Williams.
A-2
<PAGE> 88
ATTACHMENT B
TEXAS GAS THRIFT PLAN
AFFILIATE PLAN TRANSFERS
A. Transfers from the Transco Energy Company Thrift Plan ("TEC Plan")
Notwithstanding anything in the Plan to the contrary, with
respect to any Participant whose accounts under the TEC Plan are spun-off from
the TEC Plan and merged into the Plan, excluding any direct rollover within the
meaning of Code Section 401(a)(31), the following special provisions shall be
applicable:
1. The Participant must file a proper investment
election for his transferred TEC Plan accounts;
provided, however, any investment fund that is
identical under the Plan and the TEC Plan may
be transferred "in-kind" to the extent
permitted by the plans' recordkeeper or
trustee.
2. Absent a timely investment election, the
transferred accounts (other than a Company
Match-Stock Account) shall be invested pursuant
to the default provisions of Attachment A.
A-3
