As filed with the Securities and Exchange Commission on November 15, 1994.
Registration Statement No. 33-____________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
____________________
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
____________________
CHESAPEAKE CORPORATION
(Exact name of Registrant as specified in its Charter)
Virginia 54-0166880
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1021 East Cary Street, Box 2350
Richmond, Virginia 23218-2350
(Address of principal executive office, including zip code)
CHESAPEAKE PACKAGING CO.
401(k) SAVINGS PLAN FOR HOURLY EMPLOYEES
(Full title of the Plan)
____________________
J. P. Causey Jr., Esq.
Vice President, Secretary and General Counsel
Chesapeake Corporation
1021 East Cary Street, Box 2350
Richmond, Virginia 23218-2350
804-697-1000
(Name, address and telephone number, including area code, of agent for service)
With copies to:
Hugh V. White, Jr., Esq.
Hunton & Williams
951 East Byrd Street
Richmond, Virginia 23219-4074
804-788-8200
____________________
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Amount to Maximum Maximum Amount of
Securities be Offering Aggregate Registration
to be Registered Price Offering Fee
Registered (1) Per Share(2) Price(2)
Common Stock, $1 par 637,559
value per share shares $30.50 $19,445,550 $6,705.36
(1) Pursuant to Rule 416(c) under Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to
be offered or sold pursuant to the employee benefit plan described herein.
In addition, each share of Common Stock is accompanied by one Preferred
Share Purchase Right.
(2) Estimated solely for the purpose of computing the registration
fee. This amount was calculated pursuant to Rule 457(c) on the basis of
$30.50 per share, which was the average of the high and low prices of the
Common Stock on the New York Stock Exchange on November 8, 1994, as
reported in The Wall Street Journal.
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
Item 1. Plan Information.
Not required to be filed with the Securities and Exchange Commission
(the "Commission").
Item 2. Registrant Information and Employee Plan Annual Information.
Not required to be filed with the Commission.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The following documents filed by Chesapeake Corporation (the
"Company") with the Commission (file No. 1-3203) are incorporated herein by
reference and made a part hereof: (i) the Company's Annual Report on Form
10-K for the year ended December 31, 1993; (ii) the Company's Quarterly
Reports on Form 10-Q for the quarters ended March 31, 1994, June 30, 1994,
and September 30, 1994; (iii) the Company's Current Report on Form 8-K
dated March 16, 1994; and (iv) the description of the Company's Common
Stock (the "Common Stock") contained in a registration statement filed
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
including any amendment or report filed for the purpose of updating such
description.
All annual reports of the Chesapeake Packaging Co. 401(k) Savings Plan
for Hourly Employees (the "Plan") filed by the Plan pursuant to Section
13(a) or 15(d) of the Exchange Act, and all documents filed by the Company
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act after the
date of the Prospectus and prior to the filing of a post-effective
amendment that indicates that all securities offered have been sold or that
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in the Prospectus and to be a part hereof from
the date of filing of such documents. Any statement contained in a
document incorporated by reference herein shall be deemed to be modified or
superseded for purposes of the Prospectus to the extent that a statement
contained herein or in any other subsequently filed document that is
incorporated by reference herein modifies or supersedes such earlier
statement. Any such statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of the
Prospectus.
Item 4. Description of Securities.
Not applicable.
Item 5. Interests of Named Experts and Counsel.
Not applicable.
Item 6. Indemnification of Directors and Officers.
The Virginia Stock Corporation Act permits, and the registrant's
Bylaws require, indemnification of the registrant's directors and officers
in a variety of circumstances, which may include indemnification for
liabilities under the Securities Act of 1933, as amended (the "Securities
Act"). Under Sections 13.1-697 and 13.1-702 of the Virginia Stock
Corporation Act, a Virginia corporation generally is authorized to
indemnify its directors and officers in civil or criminal actions if they
acted in good faith and believed their conduct to be in the best interests
of the corporation and, in the case of criminal actions, had no reasonable
cause to believe that the conduct was unlawful. The Company's Bylaws
require indemnification of directors and officers with respect to certain
liabilities, expenses and other amounts imposed upon them by reason of
having been a director or officer, except in the case of willful misconduct
or a knowing violation of criminal law. In addition, the Company carries
insurance on behalf of directors, officers, employees or agents that may
cover liabilities under the Securities Act. The Company's Bylaws also
provide that, to the full extent the Virginia Stock Corporation Act (as it
presently exists or may hereafter be amended) permits the limitation or
elimination of the liability of directors and officers, no director or
officer of the Company shall be liable to the Company or its shareholders
for monetary damages with respect to any transaction, occurrence or course
of conduct. Section 13.1-692.1 of the Virginia Stock Corporation Act
presently permits the elimination of liability of directors and officers in
any proceeding brought by or in the right of the Company or brought by or
on behalf of stockholders of the Company, except for liability resulting
from such person's having engaged in willful misconduct or a knowing
violation of the criminal law or any federal or state securities law,
including, without limitation, any unlawful insider trading or manipulation
of the market for any security. Sections 13.1-692.1 and 13.1-696 to -704
of the Virginia Stock Corporation Act are hereby incorporated by reference
herein.
Item 7. Exemption from Registration Claimed.
Not applicable.
Item 8. Exhibits.
Exhibit No.
4.1 Articles of Incorporation (filed as Exhibit 3.1 to the Company's
Annual Report on Form 10-K for the year ended December 31, 1989, and
incorporated herein by reference).
4.2 Bylaws (filed as Exhibit 3.2 to the Company's Annual Report on
Form 10-K for the year ended December 31, 1991, and incorporated
herein by reference).
4.3 Rights Agreement, dated as of March 15, 1988, between the Company and
Crestar Bank (filed as Exhibit 4.1 to the Company's Current Report on
Form 8-K dated March 15, 1988, and incorporated herein by reference).
4.4 Rights Agreement Amendment, dated as of August 24, 1992, between the
Company and Harris Trust and Savings Bank (filed as Exhibit 4.4 to the
Company's Registration Statement on Form S-8, File No. 33-____, and
incorporated herein by reference).
4.5 Form of Chesapeake Packaging Co. 401(k) Savings Plan for Hourly
Employees (filed herewith).
4.6 Form of Chesapeake Packaging Co. 401(k) Savings Plan for Hourly
Employees Trust Agreement between the Company and The Bank of New York
(filed herewith).
5 Opinion of Hunton & Williams as to the legality of the securities
being registered (filed herewith).
23.1 Consent of Hunton & Williams (included in Exhibit 5).
23.2 Consent of Coopers & Lybrand L.L.P. (filed herewith).
24 Powers of Attorney (included on signature page).
The Company undertakes that it will submit the Plan and any amendments
hereto, to the Internal Revenue Service (the "IRS") in a timely manner and
will, to the extent that the Company believes it necessary or appropriate,
make all changes required by the IRS in order to qualify the Plan under
Section 401(a) of the Internal Revenue Code.
Item 9. Undertakings
(a) The undersigned registrant hereby undertakes:
1. To file, during any period in which offers or sales are
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration
statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the
registration statement or any material change in such
information in the registration statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
2. That, for the purpose of determining any liability under the
Securities Act, 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, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the
Exchange Act (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Exchange Act) that is
incorporated by reference in the registration statement shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling
persons of the registrant pursuant to the provisions described under Item 6
above, or otherwise, the registrant has been advised that in the opinion of
the Commission such indemnification is against public policy as expressed
in the Securities Act, and is, therefore, unenforceable. In the event that
a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the registrant in the successful defense
of any action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act, 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 Richmond, Commonwealth of
Virginia, on this 11th day of October, 1994.
CHESAPEAKE CORPORATION
(Registrant)
By /s/ J. Carter Fox
J. Carter Fox
President, Chief Executive Officer and
Chairman of the Board of Directors
Pursuant to the requirements of the Securities Act, this registration
statement has been signed by the following persons in the capacities
indicated on this 11th day of October, 1994. Each person whose signature
appears below hereby authorizes the agent for service named in the
registration statement to execute in the name of each such person, and to
file, any amendment, including any post-effective amendment, to the
registration statement making such changes in the registration statement as
the registrant deems appropriate, and appoints the agent for service as
attorney-in-fact to sign in his behalf individually and in each capacity
stated below and file all amendments and post-effective amendments to the
registration statement.
Signature Title
By /s/ J. Carter Fox By /s/ Wallace Stettinius
J. Carter Fox Chairman of the Wallace Stettinius
Board of Directors, President & Director
Chief Executive Officer
By /s/ Paul A. Dresser, Jr. By /s/ John Hoyt Stookey
Paul A. Dresser, Jr. Director, John Hoyt Stookey
Executive Vice President & Director
Chief Operating Officer
By /s/ Robert L. Hintz By /s/ Richard G. Tilghman
Robert L. Hintz Richard G. Tilghman
Director Director
By /s/ William D. McCoy By /s/ Joseph P. Viviano
William D. McCoy Joseph P. Viviano
Director Director
By /s/ C. Elis Olsson By /s/ Harry H. Warner
C. Elis Olsson Harry H. Warner
Director Director
By /s/ John W. Rosenblum By /s/ Andrew J. Kohut
John W. Rosenblum Andrew J. Kohut
Director Vice President - Finance &
Chief Financial Officer
By /s/ Christopher R. Burgess
Christopher R. Burgess
Controller
<PAGE>
The Plan. Pursuant to the requirements of the Securities Act, the
Plan has caused this registration statement to be signed on its behalf by
the undersigned, thereto duly authorized, in the City of Richmond,
Commonwealth of Virginia, on this 11th day of October, 1994.
CHESAPEAKE PACKAGING CO. 401(k)
SAVINGS PLAN FOR HOURLY EMPLOYEES
By /s/ Thomas A. Smith
Thomas A. Smith
Vice President - Human Resources and
Assistant Secretary
<PAGE>
EXHIBIT INDEX
Sequentially
Exhibit No. Description Numbered Page
4.1 Articles of Incorporation (filed as Exhibit 3.1 to the
Company's Annual Report on Form 10-K for the year ended
December 31, 1989, and incorporated herein by
reference).
4.2 Bylaws (filed as Exhibit 3.2 to the Company's Annual
Report on Form 10-K for the year ended December 31,
1991, and incorporated herein by reference).
4.3 Rights Agreement, dated as of March 15, 1988, between
the Company and Crestar Bank (filed as Exhibit 4.1 to
the Company's Current Report on Form 8-K dated March
15, 1988, and incorporated herein by reference).
4.4 Rights Agreement Amendment, dated as of August 24,
1992, between the Company and Harris Trust and Savings
Bank (filed as Exhibit 4.4 to the Company's
Registration Statement on Form S-8, File No.
33-______, and incorporated herein by reference).
4.5 Form of Chesapeake Packaging Co. 401(k) Savings Plan
for Hourly Employees (filed herewith).
4.6 Form of Chesapeake Packaging Co. 401(k) Savings Plan
for Hourly Employees Trust Agreement between the
Company and The Bank of New York (filed herewith).
5 Opinion of Hunton & Williams as to the legality of the
securities being registered (filed herewith).
23.1 Consent of Hunton & Williams (included in Exhibit 5).
23.2 Consent of Coopers & Lybrand L.L.P. (filed herewith).
24 Powers of Attorney (included on signature page).
Exhibit 4.5
CHESAPEAKE PAPER PRODUCTS COMPANY
401(k) SAVINGS PLAN FOR HOURLY EMPLOYEES
As Amended and Restated
Effective January 1, 1993
<PAGE>
Chesapeake Paper Products Company
401(k) Savings Plan for Hourly Employees
TABLE OF CONTENTS
INTRODUCTION
ARTICLE I DEFINITIONS
1.01. Account . . . . . . . . . . . . . . . . . . . . . I-1
1.02. Actual Deferral Percentage or ADP . . . . . . . . I-1
1.03. Affiliate . . . . . . . . . . . . . . . . . . . . I-2
1.04. Alternate Payee . . . . . . . . . . . . . . . . . I-2
1.05. Annuity Starting Date . . . . . . . . . . . . . . I-2
1.06. Beneficiary or Beneficiaries. . . . . . . . . . . I-2
1.07. Board or Board of Directors . . . . . . . . . . . I-3
1.08. Break in Service. . . . . . . . . . . . . . . . . I-3
1.09. Code. . . . . . . . . . . . . . . . . . . . . . . I-3
1.10. Committee . . . . . . . . . . . . . . . . . . . . I-3
1.11. Company . . . . . . . . . . . . . . . . . . . . . I-3
1.12. Compensation. . . . . . . . . . . . . . . . . . . I-3
1.13. Contribution Percentage . . . . . . . . . . . . . I-4
1.14. Defined Benefit Plan. . . . . . . . . . . . . . . I-5
1.15. Defined Contribution Plan . . . . . . . . . . . . I-5
1.16. Disabled or Disability. . . . . . . . . . . . . . I-5
1.17. Effective Date. . . . . . . . . . . . . . . . . . I-5
1.18. Elective Deferral Account . . . . . . . . . . . . I-5
1.19. Elective Deferral Contributions . . . . . . . . . I-5
1.20. Employee. . . . . . . . . . . . . . . . . . . . . I-5
1.21. Employer. . . . . . . . . . . . . . . . . . . . . I-6
1.22. Entry Date. . . . . . . . . . . . . . . . . . . . I-6
1.23. ERISA . . . . . . . . . . . . . . . . . . . . . . I-6
1.24. Excess Aggregate Contribution . . . . . . . . . . I-6
1.25. Excess Contribution . . . . . . . . . . . . . . . I-6
1.26. Excess Deferral . . . . . . . . . . . . . . . . . I-7
1.27. Family Member . . . . . . . . . . . . . . . . . . I-7
1.28. Fiduciary . . . . . . . . . . . . . . . . . . . . I-7
1.29. Highly Compensated Employee . . . . . . . . . . . I-7
1.30. Hour of Service . . . . . . . . . . . . . . . . .I-10
1.31. Investment Manager. . . . . . . . . . . . . . . .I-13
1.32. Matching Account. . . . . . . . . . . . . . . . .I-13
1.33. Matching Contribution . . . . . . . . . . . . . .I-13
1.34. Named Fiduciary . . . . . . . . . . . . . . . . .I-13
1.35. Normal Retirement Age . . . . . . . . . . . . . .I-13
1.36. Participant . . . . . . . . . . . . . . . . . . .I-13
1.37. Plan. . . . . . . . . . . . . . . . . . . . . . .I-13
1.38. Plan Administrator. . . . . . . . . . . . . . . .I-14
1.39. Plan Year . . . . . . . . . . . . . . . . . . . .I-14
1.40. Qualified Domestic Relations
Order . . . . . . . . . . . . . . . . . . .I-14
1.41. Qualified Matching Contribution . . . . . . . . .I-15
1.42. Qualified Plan or Qualified
Trust . . . . . . . . . . . . . . . . . . .I-15
1.43. Restricted 401(k) Employee. . . . . . . . . . . .I-15
1.44. Restricted 401(m) Employee. . . . . . . . . . . .I-15
1.45. Rollover Account. . . . . . . . . . . . . . . . .I-15
1.46. Rollover Contributions. . . . . . . . . . . . . .I-15
1.47. Spouse or Surviving Spouse. . . . . . . . . . . .I-16
1.48. Trust Agreement . . . . . . . . . . . . . . . . .I-16
1.49. Trust Fund. . . . . . . . . . . . . . . . . . . .I-16
1.50. Trustee . . . . . . . . . . . . . . . . . . . . .I-16
1.51. Union . . . . . . . . . . . . . . . . . . . . . .I-16
1.52. Unrestricted 401(k) Employee. . . . . . . . . . .I-16
1.53. Unrestricted 401(m) Employee. . . . . . . . . . .I-16
1.54. Valuation Date. . . . . . . . . . . . . . . . . .I-17
1.55. Year of Service . . . . . . . . . . . . . . . . .I-17
ARTICLE II PARTICIPATION
2.01. Initial Eligibility to Partici-
pate. . . . . . . . . . . . . . . . . . . .II-1
2.02. Participation of Reemployed Indi-
viduals . . . . . . . . . . . . . . . . . .II-1
2.03. Notification and Application to
Participate . . . . . . . . . . . . . . . .II-2
2.04. Change in Status. . . . . . . . . . . . . . . . .II-2
2.05. Cessation of Participation. . . . . . . . . . . .II-2
2.06. Participation for Purposes of Roll-
over Contribution Only. . . . . . . . . . .II-2
ARTICLE III CONTRIBUTIONS
3.01. Elective Deferral Contributions . . . . . . . . III-1
3.02. Matching Contributions. . . . . . . . . . . . . III-1
3.03. Qualified Matching Contributions. . . . . . . . III-1
3.04. Elective Deferral Contribution
Limitations . . . . . . . . . . . . . . . III-2
3.05. Matching Contribution Limita-
tions . . . . . . . . . . . . . . . . . . III-4
3.06. General Provisions on Elective
Deferral Contributions. . . . . . . . . . III-6
3.07. Rollover Contributions. . . . . . . . . . . . . III-6
3.08. General Provisions on Employer
Contributions . . . . . . . . . . . . . . III-7
ARTICLE IV ALLOCATIONS
4.01. Participants' Accounts. . . . . . . . . . . . . .IV-1
4.02. Allocation of Rollover Contribu-
tions . . . . . . . . . . . . . . . . . . .IV-1
4.03. Allocation of Employer Contribu-
tions . . . . . . . . . . . . . . . . . . .IV-1
4.04. Funding Policy. . . . . . . . . . . . . . . . . .IV-1
4.05. Allocation of Trust Income and
Gains and Losses. . . . . . . . . . . . . .IV-2
4.06. Excess Deferrals. . . . . . . . . . . . . . . . .IV-2
4.07. Excess Contributions. . . . . . . . . . . . . . .IV-3
4.08. Excess Aggregate Contributions. . . . . . . . . .IV-4
ARTICLE V VESTING
5.01. Rollover Account and Elective
Deferral Account. . . . . . . . . . . . . . V-1
5.02. Matching Account. . . . . . . . . . . . . . . . . V-1
5.03. Crediting Years of Service. . . . . . . . . . . . V-1
5.04. Vesting Break in Service Rules. . . . . . . . . . V-2
5.05. Forfeitures . . . . . . . . . . . . . . . . . . . V-2
5.06. Amendments Affecting Vested
Account Balance . . . . . . . . . . . . . . V-3
ARTICLE VI DISTRIBUTIONS
6.01. Timing of Distributions . . . . . . . . . . . . .VI-1
6.02. Optional Forms of Benefit . . . . . . . . . . . .VI-2
6.03. Commutation of Benefits . . . . . . . . . . . . .VI-3
6.04. Commencement of Benefits. . . . . . . . . . . . .VI-3
6.05. Special Distribution Provisions . . . . . . . . .VI-3
6.06. Limitations on Distributions of
Elective Deferral Contribu-
tions . . . . . . . . . . . . . . . . . . .VI-5
6.07. Withdrawals . . . . . . . . . . . . . . . . . . .VI-6
6.08. Hardship Distributions. . . . . . . . . . . . . .VI-7
6.09. Qualified Domestic Relations
Order Payments. . . . . . . . . . . . . . .VI-8
6.10. Direct Rollovers. . . . . . . . . . . . . . . . VI-11
ARTICLE VII DEATH BENEFITS
7.01. General . . . . . . . . . . . . . . . . . . . . VII-1
7.02. Death Distributions . . . . . . . . . . . . . . VII-1
7.03. Designation of Beneficiary. . . . . . . . . . . VII-3
7.04. Election by Beneficiary . . . . . . . . . . . . VII-4
ARTICLE VIII APPOINTMENTS AND ALLOCATION OF
FIDUCIARY RESPONSIBILITY
8.01. Named Fiduciary . . . . . . . . . . . . . . . .VIII-1
8.02. Appointment of Investment
Manager . . . . . . . . . . . . . . . . .VIII-1
8.03. Allocation of Responsibility. . . . . . . . . .VIII-1
8.04. Plan Administrator. . . . . . . . . . . . . . .VIII-1
8.05. Hourly 401(k) Savings Plan Com-
mittee. . . . . . . . . . . . . . . . . .VIII-2
8.06. Trustee . . . . . . . . . . . . . . . . . . . .VIII-2
8.07. Errors and Omissions. . . . . . . . . . . . . .VIII-2
8.08. Fiduciary Discretion. . . . . . . . . . . . . .VIII-3
ARTICLE IX PLAN ADMINISTRATION
9.01. General . . . . . . . . . . . . . . . . . . . . .IX-1
9.02. Duties of Plan Administrator. . . . . . . . . . .IX-1
9.03. Disclosure. . . . . . . . . . . . . . . . . . . .IX-1
9.04. Annual Accountings. . . . . . . . . . . . . . . .IX-2
9.05. Expenses and Compensation . . . . . . . . . . . .IX-3
9.06. Directions to Trustee . . . . . . . . . . . . . .IX-3
9.07. Claims Procedure. . . . . . . . . . . . . . . . .IX-3
9.08. Hourly 401(k) Savings Plan Com-
mittee. . . . . . . . . . . . . . . . . . .IX-5
ARTICLE X TRUST AGREEMENT AND INVESTMENTS
10.01. Trust Agreement . . . . . . . . . . . . . . . . . X-1
10.02. Participant Directed Investments. . . . . . . . . X-1
10.03. Investment of Income. . . . . . . . . . . . . . . X-6
10.04. Company Stock . . . . . . . . . . . . . . . . . . X-6
ARTICLE XI AMENDMENT AND TERMINATION OF THE PLAN
11.01. Amendment to the Plan . . . . . . . . . . . . . .XI-1
11.02. Termination of the Plan . . . . . . . . . . . . .XI-1
11.03. No Reversion to Employer. . . . . . . . . . . . .XI-2
11.04. Merger, Consolidation and Transfer
of Assets or Liabilities. . . . . . . . . .XI-3
ARTICLE XII GENERAL PROVISIONS
12.01. Qualification . . . . . . . . . . . . . . . . . XII-1
12.02. No Guarantees . . . . . . . . . . . . . . . . . XII-1
12.03. Limits on Assignment. . . . . . . . . . . . . . XII-2
12.04. Discharge of Liability. . . . . . . . . . . . . XII-2
12.05. Unclaimed Benefits. . . . . . . . . . . . . . . XII-2
12.06. Construction. . . . . . . . . . . . . . . . . . XII-2
12.07. Adoption by Affiliate . . . . . . . . . . . . . XII-3
SIGNATURE PAGE
EXHIBIT I INVESTMENT FUNDS
<PAGE>
INTRODUCTION
The Chesapeake Corporation 401(k) Savings Plan for Hourly Employees (the
Plan) was originally adopted effective January 1, 1989. The Plan was amended
and restated, effective January 1, 1993, to incorporate amendments adopted since
the Plan's original effective date and to conform to the provisions of the Tax
Reform Act of 1986 and subsequent statutory and regulatory changes. Effective
January 1, 1993, the name of the Plan is changed from the Chesapeake Corporation
401(k) Savings Plan for Hourly Employees to the Chesapeake Paper Products
Company 401(k) Savings Plan for Hourly Employees.
The Company intends that Employer contributions to the Trust be
deductible. The Company intends that the Plan be a discretionary contribution
plan. The Company further intends to comply fully with statutes and regulations
governing wages, compensation, and fringe employment benefits, especially
Internal Revenue Code sections 401(a) and 401(k). All questions arising in the
construction and administration of the Plan must be resolved accordingly.
<PAGE>
ARTICLE I
DEFINITIONS
1.01. Account means an actual account or bookkeeping record reflecting a
Participant's interest in the assets or value of the Trust Fund. A Participant
may have several Accounts. When the term Account is used without modification,
it means the sum of all of a Participant's Plan Accounts. Amounts credited to a
Participant's Account (other than a specially segregated account) do not give a
Participant a right to or claim on any asset of the Trust Fund.
SEE ALSO Elective Deferral Account, Matching Account, Rollover Account.
1.02. Actual Deferral Percentage or ADP, for purposes of measuring
compliance with Code section 401(k), for a specified group of Employees for a
Plan year, means the average of the ratios (calculated separately for each
Employee in the group) of
(a) the amount of Employer contributions made on behalf of the Employee
for the Plan Year, to
(b) the Employee's compensation (as defined in Code section 414(s)) for
the Plan Year.
For purposes of this definition, Employer contributions shall include (i)
Elective Deferral Contributions, including Excess Deferrals of Highly
Compensated Employees, but excluding Excess Deferrals of non-Highly Compensated
Employees and Elective Deferral Contributions taken into account in the
Contribution Percentage test under Plan section 3.05, provided that the ADP test
under Plan section 3.04 is satisfied both with and without the exclusion of
these Elective Deferral Contributions and (ii) at the election of the Employer,
Qualified Matching Contributions. The Actual Deferral Percentage of an Employee
who is eligible to but does not make an Elective Deferral Contribution and who
does not receive an allocation of a Qualified Matching Contribution is zero.
1.03. Affiliate means
(a) a member of a controlled group of corporations as defined in Code
section 1563(a), determined without regard to Code section 1563(a)(4) and
1563(e)(3)(C), of which an Employer is a member according to Code section
414(b);
(b) an unincorporated trade or business that is under common control
with an Employer as determined according to Code section 414(c);
(c) a member of an affiliated service group of which an Employer is a
member according to Code section 414(m); or
(d) any entity required to be aggregated according to Code section
414(o).
1.04. Alternate Payee means a Participant's Spouse, former Spouse, child,
or other dependent who is recognized by a Qualified Domestic Relations Order as
having a right to receive all or a portion of the benefits payable under the
Plan with respect to the Participant.
1.05. Annuity Starting Date means the first day on which all events occur
that entitle a Participant to a benefit under the Plan. A Participant's Annuity
Starting Date cannot be earlier than 30 days or later than 90 days after he
receives the information requested by Plan section 6.01(b), unless he waives
such notice period in accordance with that Plan section.
1.06. Beneficiary or Beneficiaries means the individual or legal entity
designated by a Participant under Plan section 7.03 to receive any benefits
which may be payable under this Plan upon or after his death. A married
Participant's Beneficiary is the Participant's Spouse unless the Spouse has
consented to the Participant's designation of a different Beneficiary.
Despite the preceding, to the extent provided in a Qualified Domestic
Relations Order, Beneficiary means the Spouse, former Spouse, child, or other
dependent of a Participant who is recognized by such order as having a right to
receive all or a portion of any benefits payable under the Plan on behalf of
such Participant.
1.07. Board or Board of Directors means the board of directors of
Chesapeake Corporation.
1.08. Break in Service means a Plan Year in which an individual does not
complete at least 501 Hours of Service.
1.09. Code means the provisions of the Internal Revenue Code of 1986, as
amended, as may be in effect from time to time. Any reference to a specific
provision of the Code shall mean both that provision and any subsequent
legislation that modifies, amends, recodifies, or replaces that provision.
1.10. Committee means the Hourly 401(k) Savings Plan Committee provided
for in Plan article IX.
1.11. Company means Chesapeake Paper Products Company and Chesapeake
Forest Products Company.
1.12. Compensation means an Employee's wages within the meaning of Code
section 3401(a) and all other amounts for which a written statement must be
furnished under Code section 6041(d) and 6051(a)(3). Compensation does not
include any amounts paid or reimbursed by an Employer for moving expenses to the
extent that it is reasonable to believe that such amounts are deductible by the
Employee under Code section 217. Compensation is 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.
For Limitation Years beginning after December 31, 1991, for purposes of
applying the limitations of this Plan section, Compensation for a Limitation
Year is the Compensation actually paid or made available during such Limitation
Year. Notwithstanding the preceding sentence, Compensation for a disabled
Participant (as defined in Code section 72(m)(7)) is the Compensation such
Participant would have received for the Limitation Year if the Participant had
been paid at the rate of Compensation paid immediately before becoming disabled.
Such imputed Compensation for the disabled Participant may be taken into account
only if the Participant is not a Highly Compensated Employee and contributions
made on behalf of such Participant are nonforfeitable when made.
Compensation shall include any amount that is contributed by an Employer
pursuant to a salary reduction agreement and which is not includible in the
gross income of the Employee under Code section 125, 402(a)(8), 402(h) or
403(b).
The Compensation for an Employee taken into account under the Plan for any
year must not exceed the statutory limits of Code section 401(a)(17) for such
year. For Plan Years beginning after December 31, 1988, and before January 1,
1994, the limit is $200,000 as adjusted. For Plan Years beginning on or after
January 1, 1994, the limit is $150,000, as adjusted.
In determining Compensation for purposes of this limitation, the rules of
Code section 414(q)(6) shall apply, except in applying such rules the term
"family" shall include only the spouse of an Employee and any lineal descendants
of an Employee who have not attained age 19 before the end of the Plan Year. If,
as a result of the application of such rules, the adjusted Code section
401(a)(17) limitation is exceeded, then the limitation shall be prorated among
affected individuals in proportion to each such individual's Compensation as
determined prior to the application of this limitation.
1.13. Contribution Percentage, for purposes of measuring compliance with
Code section 401(m), for a specified group of Employees means the average of the
ratios (calculated separately for each Employee in the group) of
(a) the Matching Contributions and Qualified Matching Contributions
allocated to the Account of each such Employee for the Plan Year to
(b) the Employee's compensation (as defined in Code section 414(s)) for
the Plan Year.
Such Contribution Percentage shall not include forfeitures of Matching
Contributions attributable to Excess Aggregate Contributions and forfeited
pursuant to Plan section 4.08. Such forfeitures shall be taken into account in
the Plan Year in which they are allocated to the Participant's Account.
Elective Deferral Contributions, to the extent not taken into account in
the Actual Deferral Percentage test under Plan section 3.04, may be included in
a Participant's Contribution Percentage.
1.14. Defined Benefit Plan means any plan established and qualified under
Code section 401 or 403, other than and to the extent it is not treated as a
Defined Contribution Plan. For purposes of limitations on benefits and
contributions, however, a Defined Benefit Plan that provides a benefit derived
from employer contributions and that is based partly on the balance of the
separate account of a Participant is treated as a Defined Contribution Plan to
the extent that benefits are based on the Participant's separate account and as
a Defined Benefit Plan for the remaining part of the benefits under the Plan.
1.15. Defined Contribution Plan means a pension, profit-sharing, or stock-
bonus plan established and qualified under Code section 401 or 403 that provides
an individual account for each Participant and for benefits based solely on the
amount contributed to each Participant's account, together with any income,
expenses, gains, losses, and any forfeitures of accounts of other Participants
that may be allocated to that Participant's account.
1.16. Disabled or Disability means a condition established by medical
evidence satisfactory to Chesapeake Corporation whereby a Participant by reason
of a mental or physical impairment is prevented from engaging in any occupation
or employment for substantial wage or profit, which condition is likely to be
permanent. The rules established for disability retirement shall be uniformly
and nondiscriminatorily applied to all persons under similar circumstances.
1.17. Effective Date means January 1, 1989. The Effective Date of the
amended and restated Plan is January 1, 1993.
1.18. Elective Deferral Account means that portion of a Participant's
Account to which his Elective Deferral Contributions are allocated.
1.19. Elective Deferral Contributions means contributions made to the Plan
during the Plan Year by an Employer, at the election of the Participant in lieu
of cash Compensation and pursuant to a salary reduction election or other
deferral mechanism. Elective Deferral Contributions shall not include any
deferrals properly distributed as Excess Annual Additions.
1.20. Employee means any individual employed by the Company who is an
hourly wage earner or any person eligible for coverage and who is employed by an
Employer that adopts this Plan pursuant to Plan section 12.07 and is covered by
a collective bargaining agreement between the Company and the Union. Employee
does not include (i) leased employees, as defined in Code sec- tion 414(n), (ii)
independent contractors or (iii) key employees, as defined in Code section
416(i).
1.21. Employer means Chesapeake Paper Products Company and any Affiliate,
individually or collectively, as applicable, that adopts the Plan; any successor
by merger, purchase, or otherwise that maintains this Plan in accordance with
any requirements set forth therein; or any predecessor that has maintained the
Plan or a predecessor plan that covered substantially the same employees and
provided the same benefits or was merged or consolidated with this Plan.
1.22. Entry Date means the first day of each Plan Year and the first day
of the seventh month of the Plan Year.
1.23. ERISA means the Employee Retirement Income Security Act of 1974, as
amended as of the relevant time. Any reference to a specific provision of ERISA
shall mean both that provision and any subsequent legislation that modifies,
amends, recodifies, or replaces that provision.
1.24. Excess Aggregate Contribution means the excess of the aggregate
amount of the Matching Contributions (and any Elective Deferral Contributions
taken into account in computing the Contribution Percentage) actually made on
behalf of Highly Compensated Employees for that Plan Year over the maximum
amount of such contributions permitted under the limitations described in Plan
section 3.05 (determined by reducing contributions made on behalf of Highly
Compensated Employees in order of their Contribution Percentages beginning with
the highest of such percentages). Such determinations shall be made after first
determining Excess Deferrals and Excess Contributions.
1.25. Excess Contribution means, with respect to a Plan Year, the excess
of the aggregate amount of Elective Deferral Contributions and Qualified
Matching Contributions actually paid to the Trust on behalf of the Highly
Compensated Employees for such Plan Year, over the maximum amount of such
contributions permitted under the limitations described in Plan section 3.04
(determined by reducing contributions made on behalf of Highly Compensated
Employees in order of their Actual Deferral Percentages beginning with the
highest of such percentages).
1.26. Excess Deferral means an elective deferral, to the extent such
elective deferral exceeds $7,000 (or such dollar amount as the Secretary of the
Treasury announces at the same time and in the same manner as the cost-of-
living adjustments applicable under Code section 415(d)) in any taxable year.
With respect to any taxable year, a Participant's elective deferrals are the sum
of all contributions made by an employer on behalf of such Participant pursuant
to:
(a) any election to defer under any qualified cash or deferred
arrangement as described in Code section 401(k);
(b) any simplified employee pension cash or deferred arrangement as
described in Code section 402(h)(1)(B);
(c) any eligible deferred compensation under Code section 457;
(d) any plan described under Code section 501(c)(18); and
(e) any contribution made by the employer on behalf of a Participant for
the purchase of an annuity contract under Code section 403(b) pursuant to a
salary reduction election.
1.27. Family Member means a member of the family of a five-percent owner
or a Highly Compensated Employee in the group consisting of the ten Highly
Compensated Employees paid the greatest Earnings from an Affiliate during the
Plan Year or the preceding Plan Year. For purposes of this Plan section, the
term "family" means, with respect to any Employee or former Employee, such
Employee's spouse and lineal ascendants or descendants and the spouse of such
lineal ascendants or descendants. Except as otherwise specified in regulations,
a Family Member is not considered to be an Employee separate from the Employee
whose status under this Plan causes the individual to be a Family Member. For
purposes of this definition, Earnings is defined in Appendix A section 1.03.
1.28. Fiduciary means a person or entity as defined in ERISA section
3(21).
1.29. Highly Compensated Employee, for Plan Years beginning after December
31, 1986, refers to those employees who are determined to be Highly Compensated
under the method set forth in subsection (a) or (b) below. The Plan
Administrator has the discretion to elect the method for making such deter-
mination in any Plan Year and may change the method for any Plan Year.
(a) Highly Compensated Employee means an employee who, during the
current or immediately preceding Plan Year,
(1) was at any time a five-percent owner (as defined in Code
section 416(i)(1));
(2) received Earnings from the Company or an Affiliate in excess
of $75,000 (or such higher dollar limit as the Secretary of the Treasury
announces at the same time and in the same manner as the cost-of-living
adjustments applicable to the limitations under Code section 415(d))
during that Plan Year;
(3) received Earnings from the Company or an Affiliate in excess
of $50,000 (or such higher dollar limit as the Secretary of the Treasury
announces at the same time and in the same manner as the cost-of-living
adjustments applicable to the limitations under Code section 415(d))
during that Plan Year and was in the top 20 percent of the Employees in
Earnings during that Plan Year; or
(4) was at any time an officer of the Company or an Affiliate and
received during that Plan Year Earnings that exceeded 50 percent of the
dollar amount in effect under Code section 415(b)(1)(A).
For purposes of this section, at least one officer of the Company or an
Affiliate must be treated as a Highly Compensated Employee, regardless of
Earnings. If at least three officers meet the Earnings figure, no more than 10
percent of the Employees may be treated as such an officer. In no event may the
Plan treat more than 50 Employees as such officers. For purposes of this
section, Earnings will be determined without regard to Code sections 125,
402(a)(8), 402(h)(1)(B), and in the case of employer contributions made pursuant
to a salary reduction agreement, without regard to Code section 403(b). The
determinations made under this section must be made in conformity with the rules
in Code section 414(q) and the related Treasury regulations. According to Code
section 414(q)(6)(A)(ii) and for purposes of applying the limitations under this
Plan, any Earnings paid to a Family Member (and any applicable contribution or
benefits on behalf of such individual) must be treated as if it were paid to (or
on behalf of) the relevant Highly Compensated Employee for that Plan Year. If
an employee is not described in (2), (3) or (4) for the preceding year, he shall
not be treated as described in (2), (3) or (4) for the current year unless he is
a member of the group consisting of the 100 employees of the Company and its
Affiliates paid the greatest Earnings during the current year.
(b) Alternatively, Highly Compensated Employee means an employee who,
during the current Plan Year only, met any of the criteria of paragraphs (1)
through (4) of subsection (a). Determination of Highly Compensated Employees
under this subsection may be made, at the Plan Administrator's discretion, on
the basis of
(1) all Workers of the Company and its Affiliates for the Plan
Year being tested; or
(2) all Workers of the Company and its Affiliates as of a
"Snapshot Day." For purposes of identifying Highly Compensated Employees
for the ADP or Contribution Percentage Tests, the Plan Administrator must,
in addition to those employees who are Highly Compensated Employees on the
Snapshot Day, treat as a Highly Compensated Employee any Worker for the
Plan Year who
(A) terminated employment prior to the Snapshot Day and was
a Highly Compensated Employee in the prior year;
(B) terminated employment prior to the Snapshot Day and (i)
was a five-percent owner; (ii) had Earnings for the Plan Year
greater than or equal to the projected Earnings of any Worker who is
treated as a Highly Compensated Employee on the Snapshot Day (except
for Workers who are Highly Compensated Employees solely because they
are officers or five-percent owners) or (iii) was an officer and had
Earnings greater than or equal to the projected Earnings of any
other officer who is treated as a Highly Compensated Employee solely
because he is an officer; or
(C) becomes employed subsequent to the Snapshot Day and (i)
is a five-percent owner, (ii) has Earnings for the Plan Year greater
than or equal to the projected Earnings of a Worker who is treated
as a Highly Compensated Employee on the Snapshot Day (except for
Workers who are Highly Compensated Employees solely because they are
officers or five-percent owners) or (iii) is an officer and has
Earnings greater than or equal to the projected Earnings of any
other officer who is treated as a Highly Compensated Employee solely
because he is an officer.
(3) The following definitions apply solely for purposes of this
subsection:
(A) "Snapshot Day" refers to a single day during the Plan
Year that is reasonably representative of the workforce of the
Company and its Affiliates. The Snapshot Day must be consistent
from Plan Year to Plan Year.
(B) "Worker" refers to an individual who renders personal
services to or through the Company or its Affiliates and who is
subject to the control of the Company or its Affiliates.
For purposes of this definition, Earnings is defined in Appendix A, section
1.03.
1.30. Hour of Service includes the following meanings:
(a) An Hour of Service is each hour for which an individual is paid or
is entitled to payment for the performance of duties for an Employer or an
Affiliate during the applicable computation period.
(b) An Hour of Service is each hour for which an individual is paid or
is entitled to payment by an Employer or an Affiliate on account of a period of
time during which no duties are performed (regardless of whether the employment
relationship has terminated) because of vacation, holiday, illness, incapacity
(including disability), layoff, jury duty, military duty, or leave of absence.
An individual may not, however, be credited with more than 501 Hours of Service
under this subsection (b) for any single continuous period during which he
performs no duties (whether or not the period occurs in a single computation
period). No Hours of Service are credited under this subsection (b) to an
individual with respect to any payment that is made or is due under a plan
maintained solely for the purpose of complying with applicable worker's
compensation or unemployment compensation or disability insurance laws, or for a
payment that solely reimburses an individual for his medical or medically
related expenses incurred. For purposes of this subsection (b), a payment is
deemed to be made by or be due from an Employer or an Affiliate regardless of
whether it is made by or due from an Employer or an Affiliate directly, or
indirectly through a trust fund or insurer to which the Employer or Affiliate
contributes or pays premiums and regardless of whether contributions made or due
to the trust fund, insurer, or other entity are for the benefit of particular
employees or on behalf of a group of employees in the aggregate.
(c) An Hour of Service is each hour for which back pay, irrespective of
mitigation of damages, is either awarded or agreed to by an Employer or an
Affiliate. The same Hours of Service shall not be credited both under
subsection (a) or (b) and also under this subsection (c). Crediting of Hours of
Service for back pay awarded or agreed to with respect to periods described in
subsection (b) is subject to the limitations set forth in that subsection.
(d) Each hour during a period in which an individual would have
performed services for and been compensated by an Employer or an Affiliate but
for the fact that such individual was on a military leave of absence for service
in the armed forces of the United States of America, provided the individual
entered such service directly from the employ of an Employer or an Affiliate,
was discharged from such service and was reemployed by an Employer or an
Affiliate within the period during which his employment rights as a veteran are
protected by law. Hours credited under this subsection shall be calculated, but
not limited, in accordance with subsection (b).
(e) For determining Hours of Service for reasons other than the
performance of duties, the special rule in Labor Regulation section 2530.200b-
2(b) is incorporated by reference. That rule provides that Hours of Service are
credited on the basis of the number of hours in the individual's regular work
schedule or, in the case of a payment not calculated by units of time, by
dividing the payment in question by the individual's most recent hourly rate of
pay.
(f) When crediting Hours of Service to computation periods, the special
rule in Labor Regulation section 2530.200b-2(c) is incorporated by reference.
That rule provides that Hours of Service are credited to individuals in the
computation periods covered by the individual's regular work schedule during the
period of nonperformance.
(g) Notwithstanding the above, each individual whose hours are not
required to be recorded under the Fair Labor Standards Act or other federal law
shall be credited with 45 Hours of Service for each week for which such
individual would be credited with at least one Hour of Service in lieu of the
Hours of Service which would otherwise be credited for such week hereunder.
(h) Despite the preceding subsections, solely for purposes of
determining whether a Break in Service for participation or vesting purposes, as
applicable, has occurred in a computation period, an individual who is on a
Maternity or Paternity Leave of Absence that began after January 1, 1985, will
receive credit for the Hours of Service that normally would have been credited
to such individual but for such Maternity or Paternity Leave of Absence or, in
any case in which such Hours of Service cannot be determined, eight Hours of
Service per day of Maternity or Paternity Leave of Absence. The total number of
Hours of Service that can be credited under the preceding sentence cannot exceed
501, and such Hours of Service shall be credited (1) in the computation period
in which the absence began if necessary to prevent the Break in Service in that
period, or (2) in all other cases, in the following computation period. Mater-
nity or Paternity Leave of Absence means an absence by reason of the pregnancy
of the individual, by reason of the placement of a child with the individual in
connection with the adoption of such child by such individual, or for purposes
of caring for such child for a period beginning immediately following such birth
or placement.
(i) Despite the preceding subsections, solely for purposes of
determining whether a Break in Service for participation or vesting purposes has
occurred during a computation period, an individual who takes unpaid leave under
the Family and Medical Leave Act on or after August 5, 1993, will receive credit
for the Hours of Service that normally would have been credited to such
individual but for such leave. The total number of Hours of Service that can be
credited under this subsection cannot exceed 501, and such Hours of Service
shall be credited (i) in the computation period in which the absence began if
necessary to prevent the Break in Service in that period, or (ii) in all other
cases, in the following computation period. Any individual who receives credit
for Hours of Service under subsection (i) above will not receive credit for
those same Hours of Service under this subsection.
1.31. Investment Manager means any fiduciary other than the Named
Fiduciary
(a) which has the power to manage, acquire or dispose of any asset of
the Plan; and
(b) which is either
(1) registered as an Investment Advisor under the Investment
Advisors Act of 1940;
(2) a bank as defined by the Investment Advisors Act of 1940; or
(3) an insurance company qualified to manage, acquire, or dispose
of any assets of the Plan under the laws of more than one state; and
(c) which has acknowledged in writing that it is a fiduciary with
respect to the Plan.
1.32. Matching Account means that portion of a Participant's Account to
which his share of Matching Contributions is allocated.
1.33. Matching Contribution means the Employer contribution described in
Plan section 3.02 which is made to the Plan on or after January 1, 1993, on
behalf of a Participant on account of Elective Deferral Contributions made by
such Participant.
1.34. Named Fiduciary means the Company.
1.35. Normal Retirement Age means the Participant's attainment of age 65.
1.36. Participant means any Employee who has become and continues to be a
Participant as provided in Plan article II.
1.37. Plan means the Chesapeake Paper Products Company 401(k) Savings Plan
for Hourly Employees, as amended from time to time. Effective January 1, 1993,
Plan means the Chesapeake Paper Products Company 401(k) Savings Plan for Hourly
Employees, as amended from time to time.
1.38. Plan Administrator means Chesapeake Corporation.
1.39. Plan Year means the 12-month period beginning on January 1 and
ending on December 31 of each calendar year.
1.40. Qualified Domestic Relations Order means a judgment, decree, order,
or approval of a property settlement agreement entered on or after January 1,
1985, that
(a) relates to the provision of child support, alimony payments, or
marital property rights to an Alternate Payee;
(b) is made pursuant to a state domestic relations or community property
law;
(c) creates or recognizes the right of, or assigns the right to, an
Alternate Payee to receive all or a portion of the benefit payable with respect
to the Participant under this Plan;
(d) clearly specifies (1) the name and last known mailing address (if
available) of the Participant and the name and mailing address of each Alternate
Payee, unless the Plan Administrator has reason to know the address indepen-
dently of the Order; (2) the amount or percentage of the Participant's benefits
to be paid by the Plan to each Alternate Payee or the manner in which such
amount or percentage is to be determined; (3) the number of payments or period
to which the Order applies; and (4) each plan to which the Order applies;
(e) does not require the Plan to provide any type or form of benefit, or
any option, not otherwise provided under the Plan;
(f) does not require the Plan to provide increased benefits (that is,
does not provide for the payment of benefits in excess of the actuarial
equivalent of the benefits to which the Participant would be entitled in the
absence of the Order); and
(g) does not require the payment of benefits to an Alternate Payee that
are required to be paid to another Alternate Payee under another order
determined previously to be a Qualified Domestic Relations Order.
A domestic relations order entered before January 1, 1985, is a Qualified
Domestic Relations Order if payment of Plan benefits pursuant to that order have
begun by January 1, 1985, regardless of whether the order satisfies the
requirements of Code section 414(p), and even if payments have not begun by
January 1, 1985, pursuant to such an order, it may still be treated as a
Qualified Domestic Relations Order even though it does not satisfy the
requirements of Code section 414(p).
1.41. Qualified Matching Contribution means the Matching Contribution made
to the Plan by the Employer pursuant to Plan section 3.03 on or after January 1,
1993, and allocated to a Participant's Account by reason of Elective Deferral
Contributions.
1.42. Qualified Plan or Qualified Trust refers to a plan or a trust
maintained as part of a plan in compliance with Code part I, subchapter D,
chapter 1, subtitle A.
1.43. Restricted 401(k) Employee, for purposes of measuring compliance
with Code section 401(k), means an Employee who is otherwise authorized under
the terms of the Plan (without regard to any suspension due to a distribution or
election not to participate by reason of Code section 415) to have Elective
Deferral Contributions allocated to his Account for all or part of the Plan Year
and who is a Highly Compensated Employee.
1.44. Restricted 401(m) Employee, for purposes of measuring compliance
with Code section 401(m), means an Employee who is otherwise authorized under
the terms of the Plan (without regard to any suspension due to a distribution or
election not to participate or by reason of the limitations of Code section 415)
to have Matching Contributions (or Elective Deferral Contributions, if the Plan
takes Elective Deferral Contribution allocations into account in determining
Contribution Percentages) allocated to his Account for all or part of the Plan
Year and who is a Highly Compensated Employee.
1.45. Rollover Account means that portion of a Participant's Account to
which his Rollover Contributions are credited.
1.46. Rollover Contributions means a transfer of assets to a qualifying
retirement plan according to Code sections 402(c), 403(a)(4) or 408(d)(3).
Unless specific Plan provisions require otherwise, a transfer of assets to the
Trust Fund is considered a Rollover Contribution to the extent the assets
transferred are not attributable to current Employer contributions.
1.47. Spouse or Surviving Spouse means the person to whom a Participant
was legally married on the earlier of his Annuity Starting Date or his death. To
the extent provided in any Qualified Domestic Relations Order, a former spouse
will be treated as the Participant's Spouse or Surviving Spouse for purposes of
the survivor annuity requirements.
1.48. Trust Agreement means the agreement between the Company and the
Trustee providing for the establishment and management of the Trust Fund.
1.49. Trust Fund means the assets of the Plan held in trust by the Trustee
pursuant to the terms of the Trust Agreement and the Plan.
1.50. Trustee means such individuals or entities as may be appointed by
the Board to hold the assets of the Trust Fund pursuant to the terms of the
Trust Agreement.
1.51. Union means the United Paperworkers International Union AFL-CIO,
West Point, Local 467.
1.52. Unrestricted 401(k) Employee, for purposes of measuring compliance
with Code section 401(k), means an Employee who is otherwise authorized under
the terms of the Plan (without regard to any suspension due to distribution or
election not to participate or by reason of the limitations of Code section 415)
to have Elective Deferral Contributions allocated to his Account for all or part
of the Plan Year and who is not a Highly Compensated Employee or a Family
Member.
1.53. Unrestricted 401(m) Employee, for purposes of measuring compliance
with Code section 401(m), means an Employee who is otherwise authorized under
the terms of the Plan (without regard to any suspension due to a distribution or
election not to participate or by reason of the limitations of Code section 415)
to have Matching Contributions (or Elective Deferral Contributions if the Plan
takes Elective Deferral Contributions into account in determining Contribution
Percentages) allocated to his Account for all of part of the Plan Year and who
is not a Highly Compensated Employee or a Family Member.
1.54. Valuation Date means the last business day of each calendar quarter
and such other dates as may be designated by the Company.
1.55. Year of Service means a Plan Year (beginning with the Plan Year that
includes the date an Employee is first credited with an Hour of Service for the
performance of duties with an Employer) in which an Employee is credited with at
least 1,000 Hours of Service. Further, an individual who is a leased employee
(as defined in Code section 414(n)) of an Employer and who subsequently becomes
an Employee of an Employer shall, subject to the Plan's Break in Service rules,
receive credit for all Years of Service he is deemed to have completed for an
Employer.
<PAGE>
ARTICLE II
PARTICIPATION
2.01. Initial Eligibility to Participate
Each Employee becomes a Participant in the Plan on the later of January 1,
1989, or the Entry Date coinciding with or immediately following the date he has
completed six months of service and attained age 18, and continues to be a
Participant as long as he continues to be employed by an Employer or is entitled
to benefits from the Plan.
2.02. Participation of Reemployed Individuals
(a) An Employee who, before satisfying the requirements of Plan section
2.01, has five consecutive Breaks in Service, loses credit for all service
completed before those Breaks in Service. Upon his reemployment as an Employee,
he must complete the requirements of Plan section 2.01 before he becomes a
Participant.
(b) A Participant who has no vested interest under the Plan attributable
to Employer contributions and who has at least five consecutive Breaks in
Service on or after January 1, 1985, loses credit for all Years of Service if
the number of his consecutive Breaks in Service equals or exceeds his Years of
Service, whether or not consecutive, completed before his Breaks in Service.
(c) An individual who loses credit for service prior to a Break in
Service under this Plan section is treated as a new employee on reemployment and
may thereafter become a Participant under the terms of Plan section 2.01.
(d) An individual who does not lose credit for service prior to a Break
in Service is eligible to participate in the Plan on the Entry Date immediately
following his reemployment and his prior service will be taken into account
effective as of his reemployment date.
(e) For purposes of applying the rules in this Plan section, a
Participant's total Years of Service does not include any Years of Service lost
as a result of an earlier Break in Service.
2.03. Notification and Application to Participate
An application to participate is not required. However, each Participant,
Beneficiary or Alternate Payee agrees, as a condition of participation, to
furnish any information or proof as may be requested from time to time to the
Plan Administrator to enable it to administer the Plan. Benefits will not be
distributed to any Participant, Beneficiary or Alternate Payee until such
requested information has been furnished.
2.04. Change in Status
If a Participant has a change in employment status such that he is no
longer an eligible Employee, but has not incurred a Break in Service, that
individual will again become a Participant immediately upon returning to an
eligible class of Employees and will be eligible to make Elective Deferral
Contributions under Plan section 3.01 as of the next Entry Date. If an
individual incurs a Break in Service, his subsequent eligibility will be
determined under the Break in Service rules of the Plan.
2.05. Cessation of Participation
Participation in the Plan ceases when a Participant is no longer an
Employee and his entire interest in the Plan has been distributed.
2.06. Participation for Purposes of Rollover Contribution Only
Notwithstanding anything herein to the contrary, if Rollover Contributions
have been authorized by the Plan Administrator, an Employee shall become a
Participant as of the date a Rollover Contribution is made on his behalf, if he
has not already become a Participant. Such person shall be a Participant only
for purposes of such Rollover Contribution, and shall not be eligible to make
Elective Deferral Contributions under Plan section 3.01.
<PAGE>
ARTICLE III
CONTRIBUTIONS
3.01. Elective Deferral Contributions
(a) The Employer's Elective Deferral Contribution for a Plan Year is the
total of the Plan Year's compensation-reduction elections allowed according to
this Plan section for Participants. The Employer must contribute each Plan
Year's Elective Deferral Contribution to the Trust Fund as soon as practicable
after the payroll period to which it relates but in no event more than 90 days
after that date. The Employer's Elective Deferral Contribution on behalf of any
Participant may not result in elective deferrals of more than $7,000 (or such
dollar amount as the Secretary of the Treasury announces at the same time and in
the same manner as the cost-of-living adjustments applicable under Code section
415(d)) in any taxable year. A Participant may cause an Elective Deferral
Contribution for himself only with regard to Compensation that is deferred
according to a compensation-reduction election according to this Plan section.
(b) Until the Plan Administrator announces otherwise, a Participant may
make a compensation-reduction election indicating an amount of unpaid Compensa-
tion (between $10 and $200 (or such dollar amount as may be determined by the
Committee each year) of his Compensation for a weekly payroll period in $10
increments) that he desires to cause to be made as an Elective Deferral
Contribution for that Plan Year.
(c) Until the Plan Administrator announces otherwise, in addition to
any amounts deferred under subsection (b) above, a Participant may make a bonus-
reduction election indicating a percentage of unpaid incentive compensation
(between 1% and 10% or such other percentage as may be determined by the
Committee) that he desires to cause to be made as an Elective Deferral
Contribution for that Plan Year.
3.02. Matching Contributions
(a) Effective January 1, 1993, the Employer shall make a Matching
Contribution each Plan Year in an amount equal to 20 percent of each
Participant's Compensation that he elects to contribute to the Plan as an
Elective Deferral Contribution for that Plan Year up to a maximum contribution
for any such Participant of $250 each Plan Year.
(b) Matching Contributions shall be vested according to the schedule
provided in Plan section 5.02.
3.03. Qualified Matching Contributions
(a) In lieu of distributing Excess Contributions, as provided in Plan
section 4.07, the Employer may make Qualified Matching Contributions on behalf
of Unrestricted 401(k) Employees that is sufficient to satisfy the Actual
Deferral Percentage test described in Plan section 3.04.
nonforfeitable when made and shall be subject to the distribution
restrictions governing Elective Deferral Contributions as provided in Plan
section 6.06.
3.04. Elective Deferral Contribution Limitations
(a) Plan sections 3.01 and 3.02 are intended to qualify as a cash or
deferred arrangement according to Code section 401(k), and all Plan and Trust
Agreement provisions must be construed to facilitate that qualification.
(b) For purposes of measuring compliance with Code section 401(k), it is
necessary to divide the Employees into Restricted 401(k) Employees and
Unrestricted 401(k) Employees.
(c) The Actual Deferral Percentage for Restricted 401(k) Employees for
each Plan Year and the Actual Deferral Percentage for Unrestricted 401(k)
Employees for the same Plan Year must satisfy one of the following tests:
(1) The Actual Deferral Percentage for Participants who are
Restricted 401(k) Employees shall not exceed the Actual Deferral
Percentage for Participants who are Unrestricted 401(k) Employees multi-
plied by 1.25; or
(2) The Actual Deferral Percentage for Participants who are
Restricted 401(k) Employees for the Plan Year shall not exceed the Actual
Deferral Percentage for Participants who are Unrestricted 401(k) Employees
multiplied by 2.0; provided, however, that the Actual Deferral Percentage
for Participants who are Restricted 401(k) Employees does not exceed the
Actual Deferral Percentage for Participants who are Unrestricted 401(k)
Employees by more than two percentage points. The percentage difference
between the Actual Deferral Percentage for Participants who are Restricted
401(k) Employees and Participants who are Unrestricted 401(k) Employees
permissible under this paragraph may be reduced as the Secretary of the
Treasury shall prescribe to prevent the multiple use of this alternate
limitation with respect to any Restricted 401(k) Employee.
(d) To meet the limitations of this Plan section and to avoid
discrimination prohibited by Code section 401(a)(4), to prevent the creation of
Excess Contributions for purposes of Code section 401(k), or, if it is necessary
to do so, to preserve the Plan's status as a qualified plan or the Plan's cash
or deferred arrangement according to Code section 401(k), the Plan Administrator
may adjust or reject, in whole or in part, any applications authorizing salary
reduction elections from Restricted 401(k) Employees. The Plan Administrator
may reduce any Participant's salary reduction election to prevent that
Participant from causing Excess Deferrals to his Elective Deferral Account.
(e) For purposes of determining the Actual Deferral Percentage of a
Participant who is a Five Percent Owner or one of the ten most highly paid
Highly Compensated Employees of the Employer, the Elective Deferral
Contributions, Qualified Matching Contributions and Compensation of such
Participant shall include the Elective Deferral Contributions, Qualified
Matching Contributions and Compensation of Family Members. Family Members, with
respect to Highly Compensated Employees, shall be disregarded as separate
Employees in determining the Actual Deferral Percentage for Restricted 401(k)
Employees.
(f) For purposes of satisfying the ADP test, Elective Deferral
Contributions and Qualified Matching Contributions must be contributed and
allocated to the Trust Fund no later than the last day of the 12-month period
immediately following the Plan Year for which such contributions are deemed
made.
(g) The Plan Administrator shall maintain records sufficient to
demonstrate satisfaction of the ADP test. The determination and treatment of
Elective Deferral Contributions and Qualified Matching Contributions and the
Actual Deferral Percentage of any Participant shall satisfy such other
requirements as may be prescribed by the Secretary of the Treasury from time to
time.
(f) The Actual Deferral Percentage for any Participant who is a
Restricted 401(k) Employee for the Plan Year and who participates in two or more
arrangements described in Code section 401(k) that are maintained by the
Employer, shall be determined as if all Elective Deferral Contributions and
Qualified Matching Contributions allocated to his Account are made under a
single arrangement. If a Highly Compensated Employee participates in two or
more arrangements described in Code section 401(k) that are maintained by the
Employer and that have different Plan Years, all such arrangements ending with
or within the same calendar year shall be treated as a single arrangement.
Notwithstanding the foregoing, certain plans shall be treated as separate if
mandatorily disaggregated under regulations under Code section 401(k).
(g) In the event that this Plan satisfies the requirements of Code
sections 401(k), 401(a)(4) or 410(b) only if aggregated with one or more other
plans, or if one or more other plans satisfy the requirements of such Code
sections only if aggregated with this Plan, then this section shall be applied
by determining the ADP of Participants as if all such plans were a single plan.
For Plan Years beginning after December 31, 1989, plans may be aggregated in
order to satisfy Code section 401(k) only if they have the same Plan Year.
3.0
(a) The Contribution Percentage for Restricted 401(m) Employees for each
Plan Year and the Contribution Percentage for Unrestricted 401(m) Employees for
the same Plan Year must satisfy one of the following tests:
(1) The Contribution Percentage for Participants who are
Restricted 401(m) Employees for the Plan Year shall not exceed the
Contribution Percentage for Participants who are Unrestricted 401(m)
Employees for the Plan Year multiplied by 1.25; or
(2) The Contribution Percentage for Participants who are
Restricted 401(m) Employees for the Plan Year shall not exceed the
Contribution Percentage for Participants who are Unrestricted 401(m)
Employees for the Plan Year multiplied by two, provided, however, that the
Contribution Percentage for Participants who are Restricted 401(m)
Employees does not exceed the Contribution Percentage for Participants who
are Unrestricted 401(m) Employees by more than two percentage points. The
percentage difference between the Participants who are Restricted 401(m)
Employees and the Participants who are Unrestricted 401(m) Employees
permissible under this paragraph may be reduced as the Secretary shall
prescribe to prevent the multiple use of this alternative limitation with
respect to any Restricted 401(m) Employee.
(b) The Employer may treat all or part of the Elective Deferral
Contributions for the Plan Year as Matching Contributions for purposes of
calculating the Contribution Percentage, provided the Actual Deferral Percentage
test of Plan section 3.04 is satisfied both including and excluding Elective
Deferral Contributions that are treated as Matching Contributions for purposes
of the Contribution Percentage test.
(c) For purposes of determining the Contribution Percentage of a
Participant who is a Restricted 401(m) Employee, the Matching Contributions and
Compensation of such Participant shall include the Matching Contributions and
Compensation of Family Members. Family Members, with respect to Restricted
401(m) Employees shall be disregarded as separate Employees in determining the
Contribution Percentage both for Participants who are Unrestricted 401(m)
Employees and for Participants who are Restricted 401(m) Employees.
(d) The Plan Administrator shall maintain records sufficient to
demonstrate satisfaction of the Contribution Percentage test. The determination
and treatment of the Contribution Percentage of any Participant shall satisfy
such other requirements as may be prescribed by the Secretary of the Treasury.
(e) For purposes of satisfying the Contribution Percentage test,
Matching Contributions must be paid to the Trust Fund no later than the last day
of the 12-month period immediately following the Plan Year for which such
contributions are deemed to be made.
(f) For purposes of determining the Contribution Percentage of a
Participant who is a five-percent owner or one of the ten most highly paid
Highly Compensated Employees, the Matching Contributions and Compensation of
such Participant shall include the Matching Contributions and Compensation for
the Plan Year of Family Members. Family Members, with respect to Highly
Compensated Employees, shall be disregarded as separate Employees in determining
the Contribution Percentage both for Participants who are non-Highly Compensated
Employees and for Participants who are Highly Compensated Employees.
(g) In the event that this Plan satisfies the requirements of Code
section 401(m), 401(a)(4), or 410(b) only if aggregated with one or more plans,
or if one or more other plans satisfy the requirements of such Code sections
only if aggregated with this Plan, then this section shall be applied by
determining the Contribution Percentage of Employees as if all such plans were a
single plan. Plans may be aggregated in order to satisfy Code section 401(m)
only if they have the same Plan Year.
3.06. General Provisions on Elective Deferral Contributions
(a) The Plan Administrator may authorize contributions to be made on a
compensation-reduction basis and may also authorize Participants to cause other
additions to be made to their Accounts each Plan Year under this Plan section so
long as such reduction can be made without exceeding the limitations described
in Plan section 3.04, such reductions can be made in a manner that is
consistently applied to all Participants, affords the same election
opportunities to all similarly situated Participants, and are implemented in a
manner which does not discriminate in favor of Restricted 401(k) and 401(m)
Employees.
(b) An Employee may elect to begin such compensation reduction as of any
Entry Date on or after he is eligible to become a Participant. An Employee may
change such compensation reductions as of the first day of any calendar quarter
with 15 days' notice to the Plan Administrator. The Plan Administrator may
establish rules limiting the number of compensation-reduction elections that a
Participant may submit each Plan Year and rules regarding changes in elections
or cancellations of elections. A compensation-reduction election remains in
effect until it is changed or canceled. All compensation-reduction elections
shall be made on forms prescribed by the Plan Administrator.
(c) In order to assure compliance with Plan section 3.04, the Plan
Administrator may establish such closing dates and formulate such other rules
and procedures as may be necessary to administer to the provisions of this Plan
section so long as such rules are established and administered on a uniform and
nondiscriminatory basis.
3.07. Rollover Contributions
Subject to the approval of the Plan Administrator, each Participant may
transfer through (i) a rollover from an individual retirement account
established pursuant to Code section 408, or (ii) a direct rollover from another
Qualified Plan or Trust to a Rollover Account to be held by the Trustee on his
behalf, any nonforfeitable interest he has in assets attributable to
contributions made by an employer under another Qualified Plan or Trust,
provided, however, that the Trustee shall only accept contributions that satisfy
the requirements of Code section 402(c), 403(a)(4) or 408(d)(3). Rollover
Contributions shall be made in cash. Rollover Contributions shall be separately
accounted for and are at all times nonforfeitable.
3.08. General Provisions on Employer Contributions
(a) The Company intends that the Plan and the Trust always qualify under
Code sections 401(a) and 501(a).
(b) If the Internal Revenue Service determines that the Plan as
reflected in this document and the Trust Agreement as created or modified to
operate with the Plan as reflected in this document do not initially qualify
under Code sections 401(a) and 501(a), or that the Plan and Trust Agreement will
initially qualify only with amendments, caveats, or conditions not acceptable to
the Company, then the Company, at its option, may either amend this Plan or the
Trust Agreement or revoke and annul any amendment in any manner deemed advisable
to effect a favorable determination or to effect qualification, or may withdraw
and terminate the Plan or Trust Agreement and may also liquidate the Trust Fund.
All contributions made prior to the Plan's failure to qualify upon initial
qualification must be returned in kind to the contributor by the Trustee, but
the Trustee may charge an Employer for services rendered according to any
agreement between the Employer and the Trustee. Despite any provisions of this
Plan to the contrary, a Participant or Beneficiary has no right or claim to any
Plan asset or Trust Fund asset relating to any benefit under the Plan accruing
prior to the Plan's initial qualification by the Internal Revenue Service
refuses to determine that the Plan and Trust Agreement qualify under the
provisions of Code sections 401(a) and 501(a). This Plan as it appears in this
document is effective if the Internal Revenue Service determines that the Plan
and the Trust Agreement are qualified under the provisions of Code sections
401(a) and 501(a).
(c) All Employer contributions to the Trust Fund are conditioned on
their deductibility under Code section 404(a). If any deduction for any
contribution is not allowed in whole or in part under Code section 404(a), then
that disallowed portion must be returned to the contributor, but repayment must
be made no later than one year after the disallowance. For purposes of this
section, the disallowance may result from the opinion of any court whose
decision has become final or by any disallowance asserted by the Internal
Revenue Service to which the Company agrees.
(d) If any contribution is made by an Employer because of a mistake of
fact, then the portion of the contribution due to the mistake of fact must be
returned to the contributor. The repayment must be made no later than one year
after the contribution.
(e) Except for a balance in a suspense account attributable to Employer
contributions remaining at the termination of the Trust due to statutory limits
on contributions and benefits, and as otherwise provided in this Plan section,
Employer contributions to the Trust Fund are irrevocable. Contributions to and
income of the Trust Fund must not be used for or diverted to purposes other than
for the exclusive benefit of Participants or their Beneficiaries.
(f) The Trustee is not required to collect Employer contributions and is
responsible only for assets received as Trustee. Each Employer may cause each
Plan Year's Employer contribution, if any, to be paid to the Trust Fund in
installments and on the dates it elects, but it must designate the Plan Year for
which each contribution is attributable.
(g) Unless allocated as of an earlier date, any contributions made by an
Employer or by a Participant after the first day of the Plan Year may be held by
the Trustee and invested as a separate account, commingled with the Trust Fund,
and allocated to the Participant's Account as of the last day of the Plan Year.
The Trustee shall maintain such records as may be necessary to see that Employer
contributions, Participant contributions, and any investment gains and losses
attributable to contributions, are allocated to the proper Participants'
Accounts in the same manner as Employer contributions.
<PAGE>
ARTICLE IV
ALLOCATIONS
4.01. Participants' Accounts
The Plan Administrator shall cause to be established and maintained one or
more separate Accounts in the name of each Participant to which shall be
credited or charged the Participant's share of Employer contributions,
forfeitures, and Rollover Contributions, as well as a proportionate share of the
net earnings, gains, or losses of the Trust Fund allocable to the investment of
the applicable Accounts, and any distributions allocable to such Accounts. By
way of example and not of limitation, separate Accounts may be maintained as an
Elective Deferral Account, a Matching Account and a Rollover Account. Further,
any earnings, gains and losses or interim contributions shall be allocated as an
Employer contributions or Rollover Contributions, as applicable.
4.02. Allocation of Rollover Contributions
Rollover Contributions shall be allocated to the appropriate Participant's
Rollover Account.
4.03. Allocation of Employer Contributions
(a) Effective January 1, 1993, Matching Contributions shall be allocated
to a Participant's Matching Account each calendar quarter.
(b) Elective Deferral Contributions shall be allocated to a
Participant's Elective Deferral Account as soon as practicable following the
date such Elective Deferral Contributions are contributed to the Trust Fund.
(c) Despite the preceding subsections, a Participant's Account may not
receive allocations for any Limitation Year in excess of the maximum limits or
less than the minimum allowances under Appendix A.
4.04. Funding Policy
The Employer shall determine annually the amount of the Employer
contribution to the Plan, if any. The Plan Administrator shall communicate the
amount of such contribution, as well as the long-range and short-range
requirements of the Plan concerning liquidity and any material changes affecting
the Plan occurring since the last such communication, to the Trustee. These
communications may be made at such times as may be determined by the Plan
Administrator.
4.05. Allocation of Trust Income and Gains and Losses
(a) As of each Valuation Date, the Trustee shall revalue the net assets
of the Trust Fund at their then current market value and adjust proportionately
the applicable Accounts of Participants so as to reflect any increase or
decrease in value of the investments of the Trust Fund as of that day as
compared with the total value of such investments on the last preceding
Valuation Date.
(b) Allocations to Participants in accordance with the provisions of
this section shall not vest any right or title to any part of the assets of the
Trust Fund in such Participants except as otherwise provided in this Plan.
4.06. Excess Deferrals
(a) Notwithstanding any other provision of the Plan, Excess Deferrals
and any income or loss allocable thereto must be distributed no later than April
15 of the calendar year following the Plan Year in which the Excess Deferrals
were made, to the Participants to whose Account such Excess Deferrals were
allocated for the preceding calendar year. A Participant who has made elective
deferrals (as described in Code section 402(g)) to a plan of an employer who is
not an Affiliate may assign to this Plan any Excess Deferrals made during the
Participant's taxable year by notifying the Plan Administrator on or before the
date specified of the amount of the Excess Deferrals to be assigned to the Plan.
A Participant is deemed to notify the Plan Administrator of any Excess Deferrals
that arise by taking into account only those Elective Deferral Contributions
made to this Plan and any other plans of this Employer or an Affiliate.
(b) Excess Deferrals and any income or loss allocable thereto may be
distributed during the calendar year in which the Excess Deferrals were made to
the Participants to whose Account such Excess Deferrals were allocated for that
calendar year. A Participant is deemed to notify the Plan Administrator of any
Excess Deferrals that arise by taking into account only those Elective Deferral
Contributions made to this Plan and any other plans of this Employer. The
correcting distribution cannot occur until after the Plan has received the
Elective Deferral Contributions that caused the Excess Deferral.
(c) Excess Deferrals shall be adjusted for any income or loss for the
Plan Year. Income or loss for the Plan Year in which the Excess Deferral
occurred will be calculated in the same manner as under Plan section 4.05.
(d) The amount of Excess Deferrals that may be distributed with respect
to a Participant shall be reduced by any Excess Deferrals previously distributed
with respect to such Participant for the Plan Year beginning with or within such
taxable year. In no event may the amount distributed pursuant to this Plan
section exceed the Participant's total Elective Deferral Contributions for such
taxable year.
4.07. Excess Contributions
(a) If there are Excess Contributions for a Plan Year, the Plan
Administrator must elect between the alternative courses of action described in
this section and any additional choices available under the Treasury regulations
to Code section 401(k)(8).
(b) Notwithstanding any other provision of this Plan, Excess
Contributions, plus any income and minus any loss allocable thereto, shall be
distributed no later than the last day of each Plan Year to Participants to
whose Account such Excess Contributions were allocated for the preceding Plan
Year. Such distribution shall be made to Highly Compensation Employees on the
basis of the respective portions of the Excess Contributions attributable to
each of such Employees. Excess Contributions of Participants who are subject to
the Family Member aggregation rules shall be allocated among the Family Members
in proportion to the Elective Deferral Contributions (and amounts treated as
Elective Deferral Contributions) of each Family Member that is combined to
determine the combined Contribution Percentage. In addition, the Plan
Administrator must cause each Participant's share of Excess Contributions to be
reduced in any manner not prohibited by law and not inconsistent with the
applicable Treasury regulations by that Participant's allocation of Excess
Deferrals that are distributed according to this Plan from the Trust Fund.
(c) Excess Contributions shall be adjusted for any income or loss for
the Plan Year. Income or loss for the Plan Year in which the Excess
Contribution occurred will be calculated in the same manner as under Plan
section 4.05.
4.08. Excess Aggregate Contributions
(a) If there are Excess Aggregate Contributions for a Plan Year, the
Plan Administrator may implement the provisions of this Plan section and take
any other action permissible according to Code section 401(m)(6) and Treasury
regulations to reduce or avoid other adverse consequences associated with Excess
Aggregate Contributions.
(b) Excess Aggregate Contributions, and any income or loss allocable
thereto, shall be forfeited, if forfeitable, or if not forfeitable, distributed
no later than the last day of the Plan Year to Participants to whose Accounts
Matching Contributions were allocated for the preceding Plan Year.
(c) As provided in Code section 401(m)(6)(C), distributions or
forfeitures of Excess Aggregate Contributions must be made to the Restricted
401(m) Employees on the basis of the respective portions of the Excess Aggregate
Contributions attributable to each of those Participants. Excess Aggregate
Contributions of Participants who are subject to the Family Member aggregation
rules shall be allocated among the Family Members in proportion to the Employee
and Matching Contributions (or amounts treated as Matching Contributions) of
each Family Member that is combined to determine the combined ACP.
(d) Excess Aggregate Contributions shall be adjusted for any income or
loss for the Plan Year. Income or loss for the Plan Year in which the Excess
Aggregate Contribution occurred will be calculated in the same manner as under
Plan section 4.05.
(e) Forfeitures of Excess Aggregate Contributions shall be used to
reduce Employer contributions for the Plan Year n which the forfeiture occurs.
Forfeitures according to this Plan section occur in the Plan Year after the
allocation that caused those amounts to be Excess Aggregate Contributions.
Amounts forfeited under this Plan section shall be treated as Annual Additions
under the Plan.
(f) To the extent that a Participant's share of the Excess Aggregate
Contributions is attributable to his allocations from Elective Deferral
Contributions, the Plan Administrator may cause the distributions authorized in
this Plan section from his Elective Deferral Account. To the extent that a
Participant's share of the Excess Aggregate Contributions is attributable to
allocations from his Matching Contributions, the Plan Administrator must cause
forfeitures authorized in this Plan section from the Participant's Excess
Aggregate Contributions and the Plan Administrator must cause distributions
authorized in this Plan section from the Participant's Matching Account. After
adjustment, as described, for Excess Deferrals or Excess Contributions that are
distributed, to the extent that the Plan Administrator causes forfeitures and
distributions to a Participant according to this Plan section, those
distributions must come from the Matching Contribution allocations to that
Participant's Matching Account, and next from that Participant's Elective
Deferral Contribution allocations to his Elective Deferral Account.
(g) The Plan Administrator must determine the amount of Excess Aggregate
Contributions after first determining the amount of Excess Deferrals and,
second, after determining the amount of Excess Contributions and causing those
Excess Deferrals and Excess Contributions to be adjusted, as authorized in Code
sections 401(k)(8) and 402(g).
<PAGE>
ARTICLE V
VESTING
5.01. Rollover Account and Elective Deferral Account
A Participant's interest in his Rollover Account and his Elective Deferral
Account is at all times fully vested and nonforfeitable.
5.02. Matching Account
(a) Each Participant who dies, becomes Disabled, or reaches Normal
Retirement Age while in the employ of an Employer shall have a fully vested,
nonforfeitable interest in his Matching Account.
(b) Otherwise, a Participant shall have a vested, nonforfeitable
interest in his Matching Account only to the extent he has satisfied the
requirements set forth in the following table:
Years of Service Vested Percentage
less than 1 0%
1 but less than 2 20%
2 but less than 3 40%
3 but less than 4 60%
4 but less than 5 80%
5 or more 100%
5.03. Crediting Years of Service
(a) Except as provided in this Plan section and Plan section 5.04, all
of an Employee's Years of Service are counted to determine the vested interest
in a Participant's Matching Account. Service with the Employer before age 18
shall be excluded.
(b) A Participant's vested interest in his Matching Account will be
determined based on his whole Years of Service. Partial Years of Service will
be recognized only to the extent that, when aggregated, they equal whole Years
of Service.
5.04. Vesting Break in Service Rules
A Participant's Years of Service for purposes of Plan section 5.02 shall
be computed subject to the following limitations and restrictions:
(a) If an Employee returns to service for an Employer after incurring a
Break in Service but before incurring five consecutive one-year Breaks in
Service, he earns Years of Service for vesting purposes for both his service
before the Break in Service and his service after the Break in Service for
purposes of determining his nonforfeitable interest in his pre-break and post-
break Accounts.
(b) If an Employee returns to service with an Employer after incurring
five or more consecutive one-year Breaks in Service, all Years of Service after
such Breaks in Service will be disregarded for the purpose of vesting in his
pre-break Account. For purposes of determining such Participant's
nonforfeitable interest in his post-break Account, he retains his Years of
Service for vesting purposes for his service before the Breaks in Service only
if either of the following applies.
(1) He had a nonforfeitable interest in his Matching Account at
the time of his separation from service.
(2) At the time he returns to service for an Employer, the number
of his consecutive one-year Breaks in Service is less than his Years of
Service.
5.05. Forfeitures
(a) When a Participant terminates his employment, the provisions of this
Plan section shall apply to any forfeitable portion of his Matching Account.
(b) Any forfeitures under the Plan shall be used to reduce Employer
contributions for the Plan Year in which the forfeiture occurs.
(c) Except as provided in subsections (d) and (e), the nonvested portion
of the Matching Account of a terminated Participant shall be forfeited as of
such Valuation Date. If the Participant is later reemployed and resumes
participation in the Plan before he has incurred five consecutive Breaks in
Service, the value of the nonvested portion of his Matching Account that was
forfeited pursuant to this subsection shall be reinstated at its value as of the
date of forfeiture without adjustment for any subsequent gains or losses to the
Trust Fund.
(d) The nonvested portion of the Matching Account of a terminated
Participant who receives a distribution from his Matching Account prior to the
date on which he completes five consecutive one-year Breaks in Service shall be
forfeited as of the Valuation Date coincident with or immediately following the
date of distribution. If the Participant is later reemployed and resumes
participation in the Plan, the value of the nonvested portion of his Matching
Account that was forfeited pursuant to this subsection shall be reinstated to
its value as of the date of forfeiture, without adjustment for any subsequent
gains or losses of the Trust Fund, if the Participant repays in cash in a lump
sum the entire amount distributed to him before the earlier of five years after
the Participant's reemployment date or the date he incurs five consecutive
Breaks in Service following the date of distribution. If the Participant's
account is not reinstated, then all Years of Service prior to such Break in
Service will be disregarded.
(e) In the case of a terminated Participant whose vested interest in his
Matching Account is zero, such Participant shall be deemed to have received a
distribution of such vested Account balance as of the Valuation Date following
the Participant's termination of employment, and the Participant's nonvested
Account balance shall be forfeited as of such date. If the Participant is later
reemployed and resumes participation in the Plan before he has incurred five
consecutive Breaks in Service, the value of the nonvested portion of his
Matching Account that was forfeited, if any, pursuant to this subsection shall
be reinstated to his Matching Account at its value as of the date of forfeiture.
(f) Amounts reinstated under this Plan section may be made, as directed
by the Plan Administrator, from forfeitures or Employer contributions.
5.06. Amendments Affecting Vested Account Balance
(a) If the Plan's vesting schedule is amended, or the Plan is amended in
any way that directly or indirectly affects the computation of the Participant's
nonforfeitable percentage or if the Plan is deemed amended by an automatic
change to or from a top-heavy vesting schedule, each Participant with at least
three Years of Service with the Employer may elect, within a reasonable period
after the adoption of the amendment or change, to have the nonforfeitable
percentage computed under the Plan without regard to such amendment or change.
For Participants who do not have at least one Hour of Service in any Plan Year
beginning after December 31, 1988, the preceding sentence shall be applied by
substituting "five Years of Service" for "three Years of Service" where such
language appears.
The period during which the election may be made shall commence with the
date the amendment is adopted or deemed to be made and shall end of the latest
of:
(1) 60 days after the amendment is adopted;
(2) 60 days after the amendment becomes effective; or
(3) 60 days after the Participant is issued written notice of the
amendment by the Employer or Plan Administrator.
(b) No amendment to the Plan shall be effective to the extent that it
has the effect of decreasing a Participant's Account balance. Notwithstanding
the preceding sentence, a Participant's Account balance may be reduced to the
extent permitted under Code section 412(c)(8). A plan amendment which has the
effect of decreasing a Participant's Account balance or eliminating an optional
form of benefit, with respect to contributions attributable to service before
the amendment shall be treated as reducing an Account balance. Furthermore, if
the vesting schedule of a plan is amended, in the case of an Employee who is a
Participant as of the later of the date such amendment is adopted or the date it
becomes effective, the nonforfeitable percentage (determined as of such date) of
such Employee's right to his Matching Account will not be less that his
percentage computed under the Plan without regard to such amendment.
<PAGE>
ARTICLE VI
DISTRIBUTIONS
6.01. Timing of Distributions
(a) Except as provided in subsections (b) and (c), in the event a
Participant terminates his employment for any reason, including Disability or
retirement, the entire vested portion of his Account shall be distributed to him
as of the Valuation Date coincident with or next following his termination of
employment or as soon thereafter as is practicable.
(b) If, as of the applicable Valuation Date, the value of the vested
portion of a terminated Participant's Account exceeds $3,500 (or has exceeded
$3,500 at the time of any prior distribution), then no fewer than 30 days and no
more than 90 days before his Annuity Starting Date, the Participant shall be
given a written notice (by first class mail or personal delivery), which
describes the following: (i) the terms and conditions of the optional forms of
benefit payment under Plan section 6.02; (ii) the Participant's right to defer
receipt of the distribution until it is no longer immediately distributable; and
(iii) the Participant's right to a period of 30 days after receipt of the notice
to consent to a distribution (and, if applicable, to elect a particular
distribution option). After receipt of the nduly authorized and, when issued in
accordance with the terms of the Plan, will be legally issued, fully paid
and non-assessable; and
3. the Rights have been duly authorized and, when issued in
tandem with the Shares in accordance with the Plan and the Rights
Agreement, will be legally issued.
We hereby consent to the filing of this opinion with the
Securities and Exchange Commission as an exhibit to such registration
statement.
Very truly yours,
/s/ Hunton & Williams
EXHIBIT 23.2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-8 of our report dated January 25, 1994, on our audits of the consolidated
financial statements and financial statement schedules of Chesapeake Corporation
and subsidiaries as of December 31, 1993 and 1992, and for the years ended
December 31, 1993, 1992 and 1991, which report is included in Chesapeake
Corporation's Annual Report on Form 10-K for the year ended December 31, 1993.
/s/ Coopers & Lybrand L.L.P.
Richmond, Virginia
November 11, 1994
