SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
20549
FORM S-8
REGISTRATION STATEMENT UNDER
THE SECURITIES ACT OF 1933
CONE MILLS CORPORATION
(Exact Name of Issuer as specified in its charter)
North Carolina 56-0367025
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
1201 Maple Street
Greensboro, North Carolina 27405
(Address of Principal Executive Offices) (Zip Code)
CONE MILLS CORPORATION
EMPLOYEE EQUITY PLAN - HOURLY
(Full title of the plan)
TERRY L. WEATHERFORD, SECRETARY
Cone Mills Corporation
1201 Maple Street
Greensboro, North Carolina 27405
(Name and Address of agent for service)
(919) 379-6220
(Telephone Number, including area code, of agent for service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Maximum Maximum
Securities Offering Aggregate
to be Amount to be Price Offering Amount of
Registered Registered Per Share* Price* Registration Fee
Common Stock,
par value
$.10 per 250,000 $16.25 $4,062,500 $1,400.87*
share shares
In addition, pursuant to Rule 416(c) under the 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.
*Pursuant to Rule 457(h), the average of the high and low
prices of the Common Stock as reported on the New York Stock
Exchange on January 13, 1994, has been used to calculate the amount
of the registration fee.
Approximate date of sale to the public: Upon effectiveness of
this Registration Statement.
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This Registration Statement on Form S-8 covers 250,000 shares
of the Common Stock, par value $.10 per share, (the "Common Stock")
of Cone Mills Corporation (the "Registrant") issuable pursuant to
the Registrant's Employee Equity Plan - Hourly (the "Plan") and an
indeterminate amount of interests to be offered or sold pursuant to
the Plan.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference.
The Registrant is subject to the informational requirements of
the Securities Exchange Act of 1934 (the "Exchange Act"), and in
accordance therewith files reports and other information with the
Securities and Exchange Commission. The following documents have
previously been filed by the Registrant with the Commission and are
incorporated herein by reference as of their respective dates:
a) the Annual Report on Form 10-K of Registrant for the
fiscal year ended January 3, 1993 (dated March 25, 1993),
as amended by a Form 8, Amendment No. 1 (dated April 30,
1993).
b) the Quarterly Report on Form 10-Q of Registrant for
the quarter ended April 4, 1993 (dated May 11, 1993); the
Quarterly Report on Form 10-Q of Registrant for the
quarter ended July 4, 1993 (dated August 16, 1993); the
Quarterly Report on Form 10-Q of Registrant for the
quarter ended October 3, 1993.
c) the Current Report on Form 8-K of Registrant dated
February 8, 1993.
d) the description of the Common Stock of the Registrant
set forth under "Item 1. Description of Registrant's
Securities to be Registered" in the Registrant's Amendment
No. 1 on Form 8 to its Registration Statement on Form 8-A
with respect to the Common Stock, File No. 1-3634 (dated
June 17, 1992).
All documents that are hereafter filed by the Registrant
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange
Act, prior to the filing of a post-effective amendment which
indicates that all securities offered pursuant to the Plan have
been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated herein by reference and
to be a part hereof from the date of filing of such documents.
Item 4. Description of Securities.
Not Applicable.
Item 5. Interests of Named Experts and Counsel.
Certain legal matters in connection with the securities
registered hereunder are being passed upon for the Registrant by
Neil W. Koonce, Esq., Vice President and General Counsel for the
Company.
<PAGE>
Item 6. Indemnification of Directors and Officers.
Article 6 of the Company's Restated Articles of Incorporation,
as amended, provides:
Article 6. INDEMNIFICATION
(a) Indemnification in Actions Other Than Actions by the
Corporation or by a Person Suing Derivatively. When by reason of
the fact that he is or was serving as a director, officer, employee
or agent of the Corporation or while serving in any such or like
capacity at the request of the Corporation in any other
corporation, partnership, joint venture or other enterprise, any
person is or was a party or threatened to be made a party to any
threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative, or investigative (except
any action, suit or proceeding brought by the Corporation or by any
person seeking derivatively to enforce any liability of such person
to the Corporation), such person shall be indemnified or reimbursed
by the Corporation for the expenses (including attorneys' fees)
which he actually and reasonably incurred and for any liabilities
which he may have incurred in consequence of such action, suit or
proceeding, subject to the following conditions:
(1) If, with respect to any action, suit or proceeding,
or with respect to any claim, matter or issue therein, such
person is wholly successful on the merits, or if the proceeding
involving such person is an administrative or investigative
proceeding and does not result in his indictment or a fine or
penalty imposed upon him, then the Corporation shall reimburse
him for the expenses (including attorneys' fees) which he
actually and reasonably incurred in consequence of his defense
of or participation in such action, suit or proceeding, or of
any claim, issue or matter therein.
(2) If, with respect to any action, suit or proceedings,
or with respect to any claim, issue or matter therein, such
person is wholly successful in his defense otherwise than
solely on the merits, the Corporation shall reimburse him for
the expenses (including attorneys' fees) which he actually and
reasonably incurred, in consequence of his defense or
participation in such action, suit or proceeding, or of any
claim, issue or matter therein, if
(A) The Board of Directors, by vote of a majority of
a quorum consisting of directors who were not parties to
such action, suit or proceeding, shall approve such
reimbursement, or
(B) If no such quorum be obtainable, by vote of a
majority of the members of the Board of Directors then in
office, acting pursuant to a written opinion of
independent legal counsel. For this purpose, the General
Counsel of the Corporation or members of his staff shall
not be deemed to be "independent legal counsel", or
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(C) In any event, by vote of the holders of a
majority of the shares entitled to vote at a meeting of
the shareholders.
(3) If, with respect to any action, suit or proceedings,
or with respect to any claim, issue or matter therein, such
person is not wholly successful or is unsuccessful in his
defense, or if the proceeding to which he is a party results in
his indictment, or in a fine or penalty imposed upon him then
the Corporation shall reimburse him for the expenses (including
attorneys' fees) which he actually and reasonably incurred and
the amount of any judgment, money decree, fine, penalty or
settlement for which he may have become liable, in either of
the following instances:
(A) The Board of Directors, by vote of a majority of
a quorum consisting of directors who are not parties to
such action, suit or proceedings, shall have determined
that such person acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best
interests of the Corporation, and, with respect to any
criminal action or proceeding, that he also had no
reasonable cause to believe his conduct was unlawful, and
the Corporation shall have given such information to the
shareholders of the Corporation with respect thereto as is
required by applicable law.
The termination of any action, suit or proceeding by
judgment, order, settlement, conviction, or upon a plea of
guilty or nolo contendere or its equivalent, shall not, of
itself, create a presumption that the person did not act
in good faith and in a manner which he reasonably believed
to be in the best interests of the Corporation, or, with
respect to any criminal action, that he had no reasonable
cause to believe that his conduct was unlawful.
(B) A plan for such payment is submitted to the
shareholders for action at an annual or special meeting of
the shareholders, and the plan is approved by the holders
of a majority of the shares entitled to vote at such
meeting, excluding shares held directly or indirectly by
any persons to be benefited if the plan is approved.
Whenever the Board of Directors is required by this
Article to determine the facts requisite to awarding
reimbursement or indemnification, their determination as
to such facts shall be conclusive in the absence of fraud.
(b) Indemnification in Actions by the Corporation or by Any
Person Suing Derivatively. When because of his duties or
activities while serving as a director, officer, employee or agent
of the Corporation or while serving in any such or like capacity at
the request of the Corporation in any other corporation,
partnership, joint venture or other enterprise, any person is a
party to an action, suit or proceeding by the Corporation or by any
person suing derivatively on behalf of the Corporation to establish
his liability to the Corporation arising out of his alleged
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dereliction of duty to the Corporation, such person shall be
entitled to reimbursement or indemnification from the Corporation
only to the extent permitted, and only pursuant to the procedure
authorized, by the General Statutes of North Carolina or otherwise
by law.
(c) General Provisions Relating to Indemnification Under this
Article:
(1) In this Article 6 the term "officer" shall include
any dominant shareholder engaged to perform services for the
Corporation, whether as employee or independent contractor; and
the term "dominant shareholder" shall mean a shareholder of the
Corporation who by virtue of his share holdings has legal
power, either directly or indirectly or through another
corporation or series of corporations, domestic or foreign, to
elect a majority of the directors of the Corporation.
(2) In this Article 6 the term "person" shall include the
heirs, executor, administrator, or other legal representative
of such person.
(3) Expenses incurred or to be incurred by a person in
defending or participating in any action, suit or proceedings
referred to in subsection (a) may be paid by the Corporation in
advance of the final disposition of such action, suit or
proceeding if authorized by the Board of Directors in the
specific case upon receipt of an undertaking by or on behalf of
such person to repay such amount, unless it shall ultimately be
determined that he is entitled to be indemnified by the
Corporation as authorized by this Article.
(4) Whenever the Corporation, whether by action of the
Board of Directors or by the shareholders, shall reimburse or
indemnify a director, officer, agent or employee as permitted
by this Article, the determination shall be made with respect
to the particular case and the particular applicant for
indemnity or reimbursement.
(5) The indemnification authorized by this Article shall
not be deemed exclusive of any other rights to indemnification
or reimbursement which are or may hereafter be permitted by
law.
(d) Insurance. The Corporation shall have power to purchase
and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the Corporation or who is
or was serving at the request of the Corporation as a director,
officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability
asserted against him and incurred by him in any such capacity, or
arising out of his status as such, whether or not the Corporation
would have the power, pursuant to law or pursuant to this Article,
to indemnify him against such liability.
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Article XI of the Company's Bylaws, as amended, provides:
Article XI. INDEMNIFICATION
Section 11-1. Extent. In addition to the indemnification
otherwise provided for by law or by the Articles of Incorporation
the Corporation, the Corporation shall indemnify and hold harmless
its directors and officers against all liability and litigation
expense, including reasonable attorneys' fees, arising out of their
status as directors or officers or their activities in any of such
capacities or in any capacity in which any of them is or was
serving, at the Corporation's request, in another corporation,
partnership, joint venture, trust or other enterprise and the
Corporation shall indemnify and hold harmless its directors,
officers, and employees who are deemed to be fiduciaries of the
Corporation's employee pension and welfare benefit plans as defined
under the Employee Retirement Income Security Act of 1974, as
amended ("ERISA fiduciaries"), against all liability and litigation
expense, including reasonable attorneys' fees, arising out of their
status or activities as ERISA fiduciaries; provided, however, that
the Corporation shall not indemnify a director or officer against
liability or litigation expense that he may incur on account of his
activities that at the time taken were known or reasonably should
have been known by him to be clearly in conflict with the best
interests of the Corporation, and the Corporation shall not
indemnify an ERISA fiduciary against any liability or litigation
expense that he may incur on account of his activities that at the
time taken were known or reasonably should have been known by him
to be clearly in conflict with the best interests of the employee
benefit plan to which the activities relate. The Corporation shall
also indemnify the director, officer or ERISA fiduciary for
reasonable costs, expenses and attorneys' fees in connection with
the enforcement of rights to indemnification granted herein, if it
is determined in accordance with Section 11-2 of this Article that
the director, officer or ERISA fiduciary is entitled to
indemnification hereunder.
Section 11-2. Determination. Any indemnification under
Section 11-1 shall be paid by the Corporation in any specific case
only after a determination that the director, officer or ERISA
fiduciary did not act in a manner, at the time the activities were
taken, that was known or reasonably should have been known by him
to be clearly in conflict with the best interests of the
Corporation, or the employee benefit plan to which the activities
relate, as the case may be. Such determination shall be made (a)
by the affirmative vote of a majority (but not less than two) of
directors who are or were not parties to such action, suit or
proceeding or against whom any such claim is asserted
("disinterested directors") even though less than a quorum, or (b)
if a majority (but not less than two) of disinterested directors so
direct, by independent legal counsel in a written opinion, or (c)
by the vote of a majority of all of the voting shares other than
those owned or controlled by directors, officers or ERISA
fiduciaries who were parties to such action, suit or proceeding or
against whom such claim is asserted, or by a unanimous vote of all
of the voting shares, or (d) by a court of competent jurisdiction.
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Section 11-3. Advanced Expenses. Expenses incurred by a
director, officer or ERISA fiduciary in defending a civil or
criminal claim, action, suit or proceeding may, upon approval of a
majority (but not less than two) of the disinterested directors,
even though less than a quorum, or, if there are less than two
disinterested directors, upon unanimous approval of the Board of
Directors, be paid by the Corporation in advance of the final
disposition of such claim, action, suit or proceeding upon receipt
of an undertaking by or on behalf of the director, officer or ERISA
fiduciary to repay such amount unless it shall ultimately be
determined that he is entitled to be indemnified against such
expenses by the Corporation.
Section 11-4. Corporation. For purposes of this Article,
references to directors, officers or ERISA fiduciaries of the
"Corporation" shall be deemed to include directors, officers and
ERISA fiduciaries of Cone Mills Corporation, its subsidiaries, and
all constituent corporations absorbed into Cone Mills Corporation
or any of its subsidiaries by a consolidation or merger.
Section 11-5. Reliance And Consideration. Any director,
officer or ERISA fiduciary who at any time after the adoption of
this Bylaw serves or has served in any of the aforesaid capacities
or any other capacity for or on behalf of the Corporation shall be
deemed to be doing or to have done so in reliance upon, and as
consideration for, the right of indemnification provided herein.
Such right shall inure to the benefit of the legal representatives
of any such person and shall not be exclusive of any other rights
to which such person may be entitled apart from the provision of
this Bylaw. No amendment, modification or repeal of this Article
XI shall adversely affect the right of any director, officer or
ERISA fiduciary to indemnification hereunder with respect to any
activities occurring prior to the time of such amendment,
modification or repeal.
Section 11-6. Insurance. The Corporation may purchase and
maintain insurance on behalf of its directors, officers, employees
and agents and those persons who were serving at the request of the
Corporation as a director, officer, partner or trustee of, or in
some other capacity in, another corporation, partnership, joint
venture, trust or other enterprise against any liability asserted
against him and incurred by him in any such capacity, or arising
out of his status as such, whether or not the Corporation would
have the power to indemnify him against such liability under the
provisions of this Article or otherwise. Any full or partial
payment made by an insurance company under any insurance policy
covering any director, officer, employee or agent made to or on
behalf of a person entitled to indemnification under this Article
shall relieve the Corporation of its liability for indemnification
provided for in this Article or otherwise to the extent of such
payment, and no insurer shall have a right of subrogation against
the Corporation with respect to such payment.
The North Carolina General Statutes contain provisions
prescribing the extent to which directors and officers shall or may
<PAGE>
be indemnified. These statutory provisions are set forth below:
CH. 55 N.C. BUSINESS CORPORATION ACT
Part 5. Indemnification.
section 55-8-50. Policy Statement and Definitions.
(a) It is the public policy of this State to enable
corporations organized under this Chapter to attract and
maintain responsible, qualified directors, officers, employees
and agents, and, to that end, to permit corporations organized
under this Chapter to allocate the risk of personal liability
of directors, officers, employees and agents through
indemnification and insurance as authorized in this Part.
(b) Definitions in this Part:
(1) "Corporation" includes any domestic or foreign
predecessor entity of a corporation in a merger or
other transaction in which the predecessor's
existence ceased upon consummation of the
transaction.
(2) "Director" means an individual who is or was a
director of a corporation or an individual who, while
a director of a corporation, is or was serving at the
corporation's request as a director, officer,
partner, trustee, employee, or agent of another
foreign or domestic corporation, partnership, joint
venture, trust, employee benefit plan, or other
enterprise. A director is considered to be serving
an employee benefit plan at the corporation's request
if his duties to the corporation also impose duties
on, or otherwise involve services by, him to the plan
or to participants in or beneficiaries of the plan.
"Director" includes, unless the context requires
otherwise, the estate or personal representative of a
director.
(3) "Expenses" means expenses of every kind incurred in
defending a proceeding, including counsel fees.
(4) "Liability" means the obligation to pay a judgment,
settlement, penalty, fine (including an excise tax
assessed with respect to an employee benefit plan),
or reasonable expenses incurred with respect to a
proceeding.
(5) "Official capacity" means: (i) when used with
respect to a director, the office of director in a
corporation; and (ii) when used with respect to an
individual other than a director, as contemplated in
G.S. 55-8-56, the office in a corporation held by the
officer or the employment or agency relationship
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undertaken by the employee or agent on
behalf of the corporation. "Official
capacity" does not include service for an
other foreign or domestic corporation or
any partnership, joint venture, trust,
employee benefit plan, or other enterprise.
(6) "Party" includes an individual who was, is, or is
threatened to be made a named defendant or respondent
in a proceeding.
(7) "Proceeding" means any threatened, pending, or
completed action, suit, or proceeding, whether civil,
criminal, administrative, or investigative and
whether formal or informal.
section 55-8-51. Authority to Indemnify.
(a) Except as provided in subsection (d), a corporation may
indemnify an individual made a party to a proceeding because he
is or was a director against liability incurred in the
proceeding if:
(1) He conducted himself in good faith; and
(2) He reasonably believed (i) in the case of conduct in
his official capacity with the corporation, that his
conduct was in its best interests; and (ii) in all
other cases, that his conduct was at least not
opposed to its best interests; and
(3) In the case of any criminal proceeding, he had no
reasonable cause to believe his conduct was unlawful.
(b) A director's conduct with respect to an employee benefit
plan for a purpose he reasonably believed to be in the
interests of the participants in and beneficiaries of the plan
is conduct that satisfies the requirement of subsection
(a)(2)(ii).
(c) The termination of a proceeding by judgment, order,
settlement, conviction, or upon a plea of no contest or its
equivalent is not, of itself, determinative that the director
did not meet the standard of conduct described in this section.
(d) A corporation may not indemnify a director under this
section:
(1) In connection with a proceeding by or in the right of
the corporation in which the director was adjudged
liable to the corporation; or
(2) In connection with any other proceeding charging
improper personal benefit to him, whether or not
involving action in his official capacity, in which
he was adjudged liable on the basis that personal
benefit was improperly received by him.
(e) Indemnification permitted under this section in connection
with a proceeding by or in the right of the
<PAGE>
corporation that is concluded without a final adjudication on
the issue of liability is limited to reasonable expenses
incurred in connection with the proceeding.
(f) The authorization, approval or favorable recommendation by
the board of directors of a corporation of indemnification, as
permitted by this section, shall not be deemed an act or
corporate transaction in which a director has a conflict of
interest, and no such indemnification shall be void or voidable
on such ground.
section 55-8-52. Mandatory Indemnification.
Unless limited by its articles of incorporation, a corporation
shall indemnify a director who was wholly successful, on the merits
or otherwise, in the defense of any proceeding to which he was a
party because he is or was a director of the corporation against
reasonable expenses incurred by him in connection with the
proceeding.
section 55-8-53. Advance For Expenses.
Expenses incurred by a director in defending a proceeding may
be paid by the corporation in advance of the final disposition of
such proceeding as authorized by the board of directors in the
specific case or as authorized or required under any provision in
the articles of incorporation or bylaws or by any applicable
resolution or contract upon receipt of an undertaking by or on
behalf of the director to repay such amount unless it shall
ultimately be determined that he is entitled to be indemnified by
the corporation against such expenses.
section 55-8-54. Court-ordered Indemnification.
Unless a corporation's articles of incorporation provide
otherwise, a director of the corporation who is a party to a
proceeding may apply for indemnification to the court conducting
the proceeding or to another court of competent jurisdiction. On
receipt of an application, the court after giving any notice the
court considers necessary may order indemnification if it
determines:
(1) The director is entitled to mandatory indemnification
under G.S. 55-8-52, in which case the court shall
also order the corporation to pay the director's
reasonable expenses incurred to obtain court-ordered
indemnification; or
(2) The director is fairly and reasonably entitled to
indemnification in view of all the relevant
circumstances, whether or not he met the standard of
conduct set forth in G.S. 55-8-51 or was adjudged
liable as described in G.S. 55-8-51(d), but if he was
adjudged so liable his indemnification is limited to
reasonable expenses incurred.
<PAGE>
section 55-8-55. Determination and Authorization of Indemnification.
(a) A corporation may not indemnify a director under G.S.
55-8-51 unless authorized in the specific case after a
determination has been made that indemnification of the
director is permissible in the circumstances because he has met
the standard of conduct set forth in G.S. 55-8-51.
(b) The determination shall be made:
(1) By the board of directors by majority vote of a
quorum consisting of directors not at the time
parties to the proceeding;
(2) If a quorum cannot be obtained under subdivision (1),
by majority vote of a committee duly designated by
the board of directors (in which designation
directors who are parties may participate),
consisting solely of two or more directors not at the
time parties to the proceeding;
(3) By special legal counsel (i) selected by the board of
directors or its committee in the manner prescribed
in subdivision (1) or (2); or (ii) if a quorum of the
board of directors cannot be obtained under
subdivision (1) and a committee cannot be designated
under subdivision (2), selected by majority vote of
the full board of directors (in which selection
directors who are parties may participate); or
(4) By the shareholders, but shares owned by or voted
under the control of directors who are at the time
parties to the proceeding may not be voted on the
determination.
(c) Authorization of indemnification and evaluation as to
reasonableness of expenses shall be made in the same manner as
the determination that indemnification is permissible, except
that if the determination is made by special legal counsel,
authorization of indemnification and evaluation as to
reasonableness of expenses shall be made by those entitled
under subsection (b)(3) to select counsel.
section 55-8-56. Indemnification of Officers, Employees, and Agents.
Unless a corporation's articles of incorporation provide
otherwise:
(1) An officer of the corporation is entitled to mandatory
indemnification under G.S. 55-8-52, and is entitled to
apply for court-ordered indemnification under G.S.
55-8-54, in each case to the same extent as a director.
(2) The corporation may indemnify and advance expenses under
this Part to an officer, employee, or agent of the
corporation to the same extent as to a director; and
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(3) A corporation may also indemnify and advance expenses to
an officer, employee, or agent who is not a director to
the extent, consistent with public policy, that may be
provided by its articles of incorporation, bylaws, general
or specific action of its board of directors, or contract.
section 55-8-57. Additional Indemnification and Insurance.
(a) In addition to and separate and apart from the
indemnification provided for in G.S. 55-8-51, 55-8-52, 55-8-54,
55-8-55 and 55-8-56, a corporation may in its articles of
incorporation or bylaws or by contract or resolution indemnify
or agree to indemnify any one or more of its directors,
officers, employees, or agents against liability and expenses
in any proceeding (including without limitation a proceeding
brought by or on behalf of the corporation itself) arising out
of their status as such or their activities in any of the
foregoing capacities; provided, however, that a corporation may
not indemnify or agree to indemnify a person against liability
or expenses he may incur on account of his activities which
were at the time taken known or believed by him to be clearly
in conflict with the best interests of the corporation. A
corporation may likewise and to the same extent indemnify or
agree to indemnify any person who, at the request of the
corporation, is or was serving as a director, officer, partner,
trustee, employee, or agent of another foreign or domestic
corporation, partnership, joint venture, trust or other
enterprise or as a trustee or administrator under an employee
benefit plan. Any provision in any articles of incorporation,
bylaw, contract, or resolution permitted under this section may
include provisions for recovery from the corporation of
reasonable costs, expenses, and attorneys' fees in connection
with the enforcement of rights to indemnification granted
therein and may further include provisions establishing
reasonable procedures for determining and enforcing the rights
granted therein.
(b) The authorization, adoption, approval, or favorable
recommendation by the board of directors of a public
corporation of any provision in any articles of incorporation,
bylaw, contract or resolution, as permitted in this section,
shall not be deemed an act or corporate transaction in which a
director has a conflict of interest, and no such articles of
incorporation or bylaw provision or contract or resolution
shall be void or voidable on such grounds. The authorization,
adoption, approval, or favorable recommendation by the board of
directors of a nonpublic corporation of any provision in any
articles of incorporation, bylaw, contract or resolution, as
permitted in this section, which occurred prior to July 1,
1990, shall not be deemed an act or corporate transaction in
which a director has a conflict of interest, and no such
articles of incorporation, bylaw provision, contract or
resolution shall be void or voidable on such grounds. Except
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as permitted in G.S. 55-8-31, no such bylaw, contract, or
resolution not adopted, authorized, approved or ratified by
shareholders shall be effective as to claims made or
liabilities asserted against any director prior to its
adoption, authorization, or approval by the board of directors.
(c) A corporation may purchase and maintain insurance on
behalf of an individual who is or was a director, officer,
employee, or agent of the corporation, or who, while a
director, officer, employee, or agent of the corporation, is or
was serving at the request of the corporation as a director,
officer, partner, trustee, employee, or agent of another
foreign or domestic corporation, partnership, joint venture,
trust, employee benefit plan, or other enterprise, against
liability asserted against or incurred by him in that capacity
or arising from his status as a director, officer, employee, or
agent, whether or not the corporation would have power to
indemnify him against the same liability under any provision of
this Chapter.
section 55-8-58. Application of Part.
(a) If articles of incorporation limit indemnification or
advance for expenses, indemnification and advance for expenses
are valid only to the extent consistent with the articles.
(b) This Part does not limit a corporation's power to pay or
reimburse expenses incurred by a director in connection with
his appearance as a witness in a proceeding at a time when he
has not been made a named defendant or respondent to the
proceeding.
(c) This Part shall not affect rights or liabilities arising
out of acts or omissions occurring before July 1, 1990.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
The Exhibits to this Form S-8 are listed in the accompanying
Index to Exhibits.
In lieu of filing an opinion of counsel concerning compliance
with the requirements of ERISA or an Internal Revenue Service
("IRS") determination letter that the Plan is qualified under
Section 401 of the Internal Revenue Code, the Registrant hereby
undertakes to submit the Plan and any amendment thereto to the IRS
in a timely manner and to make all changes required by the IRS in
order to qualify the Plan.
Item 9. Undertakings.
The undersigned Registrant hereby undertakes:
<PAGE>
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this Registration
Statement:
(i) To include any prospectus required by section
10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental
change in the information set forth in the Registration
Statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
Registration Statement or any material change in such
information in the Registration Statement.
Provided, however, that paragraphs (1)(i) and (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 Securities Exchange Act of 1934 that
are incorporated by reference in the Registration Statement.
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each such post-effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
The undersigned Registrant hereby undertakes that, for the
purposes of determining any liability under the Securities Act of
1933, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Securities Exchange Act of
1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities
Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the foregoing
provisions, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such
<PAGE>
indemnification is against public policy as expressed in the Act
and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the Registrant of expenses incurred or paid by a director, officer
or controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such director,
officer or controlling person in connection with the securities
being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in
the Act and will be governed by the final adjudication of such
issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and
has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City
of Greensboro, North Carolina on January 18, 1994.
CONE MILLS CORPORATION
Date: January 18, 1994 By: /s/J. Patrick Danahy
J. Patrick Danahy
President and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed by the following
persons in the following capacities on August 19, 1993.
<TABLE>
<S> <C> <C>
Signature Title Date
Chairman of the Board
(Dewey L. Trogdon)
/s/J. Patrick Danahy Director, President and January 18, 1994
(J. Patrick Danahy) Chief Executive Officer
(Principal Executive Officer)
/s/John L. Bakane Director, Vice President January 18, 1994
(John L. Bakane) and Chief Financial Officer
(Principal Financial Officer)
/s/Richard S. Vetack Director January 18, 1994
(Richard S. Vetack)
/s/Bud W. Willis, III Director January 18, 1994
(Bud W. Willis, III)
</TABLE>
<PAGE>
<TABLE>
<S> <C> <C>
Signature Title Date
/s/Doris R. Bray Director January 18, 1994
(Doris R. Bray)
Director
(Leslie W. Gaulden)
Director
(Jeanette C. Kimmel)
/s/Charles M. Reid Director January 18, 1994
(Charles M. Reid)
/s/J. D. Holder Controller January 18, 1994
J. D. Holder (Principal Accounting
Officer)
</TABLE>
<PAGE>
EXHIBITS
<PAGE>
INDEX TO EXHIBITS
Exhibit Sequential
No. DESCRIPTION Page No.
* 4.1 Restated Articles of Incorporation of
the Registrant effective August 25,
1993, filed as Exhibit 4.1 to the
Registrant's report on Form 10-Q for
the quarter ended October 3, 1993.
* 4.2 Amended and Restated Bylaws of
Registrant, effective June 18, 1992,
filed as Exhibit 3.5 to the
Registrant's Registration Statement on
Form S-1 (File No. 33-46907).
* 4.3 Note Agreement dated as of August 13,
1992, between Cone Mills Corporation
and The Prudential Insurance Company
of America, with form of 8% promissory
note attached, filed as Exhibit 4.01
to the Registrant's report on Form 8-K
dated August 13, 1992.
* 4.4 Credit Agreement dated as of August
13, 1992, among Cone Mills
Corporation, the banks listed therein
and Morgan Guaranty Trust Company of
New York, as Agent, with form of note
attached, filed as Exhibit 4.02 to the
Registrant's report on Form 8-K dated
August 13, 1992.
* 4.5 Specimen Class A Preferred Stock
Certificate, filed as Exhibit 4.5 to
the Registrant's Registration
Statement on Form S-1 (File No.
33-46907).
* 4.6 Specimen Common Stock Certificate,
effective June 18, 1992, filed as
Exhibit 4.7 to the Registrant's
Registration Statement on Form S-1
(File No. 33-46907).
* 4.7 Registration rights agreement dated as
of March 30, 1992, among the
Registrant and the shareholders listed
therein, filed as Exhibits 4.8 to the
Registrant's Registration Statement on
Form S-1 (File No. 33-46907).
<PAGE>
Enhibit Sequential
No. Page No.
4.8 Supplemental Retirement Program of
Registrant as amended and restated
effective September 1, 1993.
4.9 The 401(k) Program (formerly the
Supplemental Retirement Program) as
amended and restated effective
January 1, 1994.
5 Opinion of Neil W. Koonce, Esq.,
General Counsel of the Registrant
regarding legality of issuance of
Common Stock.
23.1 Consent of Neil W. Koonce, Esq.
contained in the Opinion, filed as
Exhibit 5 hereto.
23.2 Consent of Robinson, Bradshaw &
Hinson, P.A.
23.3 Consent of McGladery & Pullen,
independent auditor.
*Incorporated by reference to the statement or
report indicated.
<PAGE>
EXHIBIT 4.8
<PAGE>
THE 401(K) PROGRAM
OF
CONE MILLS CORPORATION
EMPLOYEE EQUITY PLAN
EMPLOYEE EQUITY PLAN - HOURLY
SUPPLEMENTAL RETIREMENT PLAN
SUPPLEMENTAL RETIREMENT PLAN - HOURLY
As Amended and Restated January 1, 1994
<PAGE>
TABLE OF CONTENTS
Page
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . .1-5
ARTICLE I DEFINITIONS
Section
1.01. Account. . . . . . . . . . . . . . . . . . . . . . . .6
1.02. Actual Deferral Percentage . . . . . . . . . . . . . .6
1.03. Advisory Committee . . . . . . . . . . . . . . . . . .6
1.04. Affiliate. . . . . . . . . . . . . . . . . . . . . . .6
1.05. Alternate Payee. . . . . . . . . . . . . . . . . . . .7
1.06. Annual Additions . . . . . . . . . . . . . . . . . . .7
1.07. Approved Leave . . . . . . . . . . . . . . . . . . . .7
1.08. Beneficiary or Beneficiaries . . . . . . . . . . 7-8
1.09. Board of Directors . . . . . . . . . . . . . . 8
1.10. Break in Service . . . . . . . . . . . . . . . . . . .8
1.11. CODA Account . . . . . . . . . . . . . . . . . . . . .8
1.12. CODA Contributions . . . . . . . . . . . . . . . . .8-9
1.13. Code . . . . . . . . . . . . . . . . . . . . . . . . .9
1.14. Compensation . . . . . . . . . . . . . . . . . . . 9-10
1.15. Computation Period . . . . . . . . . . . . . . . . . 10
1.16. Cone . . . . . . . . . . . . . . . . . . . . . . . . 10
1.17. Cone Contributions . . . . . . . . . . . . . . . . . 10
1.18. Cone Contributions Account . . . . . . . . . . . . . 11
1.19. Continuous Service . . . . . . . . . . . . . . . .11-12
1.20. EEP . . . . . . . . . . . .. . . . . . . . . . . . . 12
1.21. EEP CODA Contributions . . . . . . . . . . . . . .. 12
1.22. EEP CODA Contributions Account . . . . . . . . . . . 12
1.23. EEP Cone Contributions . . . . . . . . . . . . . . . 12
1.24. EEP Cone Contributions Account . . . . . . . . . . . 12
1.25. EEP Voluntary Contributions Account. . . . . . . . . 12
1.26. Effective Date . . . . . . . . . . . . . . . . . .12-13
1.27. Eligible Employee. . . . . . . . . . . . . . . . . . 13
1.28. Employee . . . . . . . . . . . . . . . . . . . . .12-13
1.29. Employer.. . . . . . . . . . . .. . . . . . . . . . 14
1.30. Employment Commencement Date . . . . . . . . . . . . 14
1.31. ERISA. . . . . . . . . . . . . . . . . . . . . . . . 14
1.32. Forfeiture . . . . . . . . . . . . . . . . . . . . . 14
1.33. Hour of Service. . . . . . . . . . . . . . . . . .14-18
1.34. Investment Committee . . . . . . . . . . . . . . . . 18
1.35. Investment Earnings. . . . . . . . . . . . . . . . . 18
1.36. Investment Fund. . . . . . . . . . . . . . . . . . . 18
1.37. Investment Manager . . . . . . . . . . . . . . . . . 19
1.38. Member . . . . . . . . . . . . . . . . . . . . . . . 19
1.39. Period of Severance. . . . . . . . . . . . . . . . . 19
1.40. Plan . . . . . . . . . . . . . . . . . . . . . . . . 19
i
<PAGE>
Section Page
1.41. Plan Year. . . . . . . . . . . . . . . . . . . . . . 19
1.42. Prior Plan . . . . . . . . . . . . . . . . . . . . . 19
1.43. Rule of Parity Years . . . . . . . . . . . . . . .19-20
1.44. Salary . . . . . . . . . . . . . . . . . . . . . . . 20
1.45. Salary-Reduction Election. . . . . . . . . . . . . . 20
1.46. Severance from Service Date. . . . . . . . . . . .20-21
1.47. Spouse . . . . . . . . . . . . . . . . . . . . . . . 21
1.48. SRP. . . . . . . . . . . . . . . . . . . . . . . . . 21
1.49. SRP CODA Contributions . . . . . . . . . . . . . . . 22
1.50. SRP CODA Contributions Account . . . . . . . . . . . 22
1.51. SRP Cone Contributions . . . . . . . . . . . . . . . 22
1.52. SRP Cone Contributions Account . . . . . . . . . . . 22
1.53. SRP Voluntary Contributions Account. . . . . . . . . 22
1.54. Trust and Trust Fund . . . . . . . . . . . . . . . . 22
1.55. Trust Agreement. . . . . . . . . . . . . . . . . . . 22
1.56. Trustee. . . . . . . . . . . . . . . . . . . . . .22-23
1.57. Valuation Date . . . . . . . . . . . . . . . . . . . 23
1.58. Voluntary Contribution . . . . . . . . . . . . . . . 23
1.59. Year of Service. . . . . . . . . . . . . . . . . .23-26
ARTICLE II PARTICIPATION
Section
2.01. Member . . . . . . . . . . . . . . . . . . . . . . . 27
2.02. Conditions of Participation. . . . . . . . . . . .27-29
2.03. Employment and Eligibility Status Changes. . . . . . 29
2.04. Participation Upon Reemployment. . . . . . . . . .29-30
ARTICLE III CONTRIBUTIONS
Section
3.01. CODA Contributions . . . . . . . . . . . . . . . .31-34
3.02. Cone Contributions . . . . . . . . . . . . . . . .34-36
3.03. Cash and Noncash Contributions . . . . . . . . . .36-37
3.04. Deferral Percentage Test - CODA Contributions. . .37-43
3.05. Contributions Percentage Test - Employee After-Tax44-47
Contributions and Cone Contributions
3.06. Distribution Restrictions. . . . . . . . . . . . .47-48
ARTICLE IV ACCOUNTS AND ALLOCATIONS
Section
4.01. Individual Accounts. . . . . . . . . . . . . . . . . 49
4.02. CODA Contributions Account . . . . . . . . . . . . . 49
ii
<PAGE>
Section Page
ARTICLE IV ACCOUNTS AND ALLOCATIONS continued:
Section
4.03. Cone Contributions Account . . . . . . . . . . . .50-53
4.04. Voluntary Contributions Account. . . . . . . . . . . 54
4.05. Allocation of Investment Earnings. . . . . . . . .54-56
4.06. Maximum Annual Additions . . . . . . . . . . . . .56-67
4.07. Adjustments for Excessive Annual Additions . . . .67-69
4.08. Determination of Top Heavy Status. . . . . . . . .69-78
4.09. Top Heavy Requirements . . . . . . . . . . . . . .79-81
ARTICLE V VESTING
Section
5.01. Vested Accounts. . . . . . . . . . . . . . . . . .82-83
5.02. Forfeitures. . . . . . . . . . . . . . . . . . . . . 83
ARTICLE VI DISTRIBUTION OF BENEFITS
Section
6.01. Claim Procedure. . . . . . . . . . . . . . . . . . .84
6.02. Review of Claims . . . . . . . . . . . . . . . . 84-85
6.03. Distribution Definitions . . . . . . . . . . . . 85-86
6.04. Methods of Payment . . . . . . . . . . . . . . . 86-91
6.05. Commencement of Benefits . . . . . . . . . . . . 91-94
6.06. Special Distribution Provisions. . . . . . . . . 94-95
6.07. Death Benefits . . . . . . . . . . . . . . . . . 95-98
6.08. Qualified Domestic Relations Order . . . . . . . 98-99
6.09. Withholding of Benefits. . . . . . . . . . . . . . 100
6.10. Hardship Withdrawal. . . . . . . . . . . . . . 100-103
6.11. Valuation of Account Balances. . . . . . . . . 103-104
6.12. Withholding of Taxes . . . . . . . . . . . . . . . 104
6.13. Eligible Rollover Distributions. . . . . . . . 104-106
ARTICLE VII DISTRIBUTION OF BENEFITS
Section
7.01. Investment Funds . . . . . . . . . . . . . . . 107-108
7.02. Directing Investment of Individual Accounts. . 108-113
7.03. Segregated Account . . . . . . . . . . . . . . . . 113
iii
<PAGE>
Section Page
ARTICLE VIII TRUST FUND AND ADMINISTRATION OF THE PLAN
Section
8.01. Named Fiduciaries, Allocation of Responsibility114-116
8.02. Duties and Responsibilities. . . . . . . . . . . . 116
8.03. Trust Fund . . . . . . . . . . . . . . . . . . 116-117
8.04. Enforceable Rights . . . . . . . . . . . . . . . . 117
8.05. Impossibility of Diversion . . . . . . . . . . . . 118
8.06. Advisory Committee and Other Committees. . . . . . 118
8.07. Officers, Quorums, Expenses. . . . . . . . . . 118-119
8.08. Duties of Investment Manger. . . . . . . . . . 119-120
8.09. Information to Investment Manager. . . . . . . 120-121
8.10. Notice to Trustee. . . . . . . . . . . . . . . . . 121
8.11. Duties of the Advisory Committee . . . . . . . 121-122
8.12. Notice of Payments Due . . . . . . . . . . . . . . 122
8.13. Records and Reports. . . . . . . . . . . . . . . . 122
8.14. Exoneration of Advisory Committee. . . . . . . 122-123
8.15. Errors and Omissions . . . . . . . . . . . . . 123-124
8.16. Fees and Expenses. . . . . . . . . . . . . . . . . 124
8.17. Voting and Tendering of Shares . . . . . . . . 124-126
8.18. Certification of Directions from Members . . . . . 126
ARTICLE IX AMENDMENT, TERMINATION AND MERGER
Section
9.01. Amendment. . . . . . . . . . . . . . . . . . . 127-129
9.02. Termination. . . . . . . . . . . . . . . . . . 129-131
9.03. Discontinuance of Contributions. . . . . . . . . . 131
9.04. Plan Merger or Asset Transfer. . . . . . . . . 131-132
9.05. Continuation of the Plan . . . . . . . . . . . . . 132
ARTICLE X MULTIPLE COMPANIES INCLUDED
Section
10.01. Plan Sponsor and Other Employers . . . . . . . . . 133
10.02. Method of Participation. . . . . . . . . . . . . . 133
10.03. Withdrawal by Employer . . . . . . . . . . . . 134-135
10.04. Tax Year . . . . . . . . . . . . . . . . . . . . . 135
iv
<PAGE>
Section Page
ARTICLE XI GENERAL
Section
11.01. Plan Creates No Separate Rights. . . . . . . . . . 136
11.02. Delegation of Authority. . . . . . . . . . . . . . 136
11.03. Limitation of Liability. . . . . . . . . . . . 137-138
11.04. Legal Action . . . . . . . . . . . . . . . . . 138-139
11.05. Benefits Supported Only by Trust . . . . . . . . . 139
11.06. Discrimination . . . . . . . . . . . . . . . . . . 139
11.07. Model Amendment IV . . . . . . . . . . . . . . . . 139
11.08. Entire Plan. . . . . . . . . . . . . . . . . . . . 140
SIGNATURE PAGE . . . . . . . . . . . . . . . . . . . . . . . 141
v
<PAGE>
INTRODUCTION
Cone Mills Corporation ("Cone") initially adopted the
Supplemental Retirement Plan of Cone Mills Corporation (the
"Supplemental Plan") effective January 1, 1947. Its purposes
were to supplement pension benefits for salaried employees of
Cone and its affiliates and to promote strong employee interest
in successful business operations.
The Supplemental Plan was amended a number of times since
inception; several of the more significant changes are described
below. Amendments effective January 1, 1983, provided for
salary-reduction contributions pursuant to a qualified cash or
deferred arrangement under Section 401 (k) of the Internal
Revenue Code, of 2% to 6% of members' salaries. Limited in-
service withdrawal rights and investment choices and a shortened
vesting period of five years instead of 15 years were also
instituted. Amendments effective January 1, 1984, to permit
after-tax voluntary contributions of 2% to 6% of salary and to
grant authority to the Advisory Committee to reduce or suspend
salary-reduction elections were adopted.
On November 11, 1986, the Board of Directors of Cone authorized
amendments which increased member cash or deferred elections to
2% to 10% of salary and discontinued after-tax contributions
effective January 1, 1987. Other changes became effective as a
result of the Retirement Equity Act of 1984 and the Tax Reform
Act of 1986. On December 8, 1987, the Board of Directors of
<PAGE>
Cone again approved amendments to the Plan which established
matching Cone contributions equal to 25% of member salary-
reduction contributions not in excess of 6% of salaries,
permitted additional matching Cone contributions at the
discretion of the Board of Directors and added semi-annual member
investment and contributions elections.
Effective May 1, 1989, the Supplemental Retirement Plan of Cone
Mills Corporation was amended, restated, and renamed, and
operated as and became known as the Supplemental Retirement
Program of Cone Mills Corporation. As amended and restated, the
Program consisted thereafter through December 31, 1993, of two
separate plans: the Cone Mills Corporation Supplemental
Retirement Plan (SRP), which was a continuation of the prior
plan, and the Cone Mills Corporation Employee Equity Plan (EEP),
which was a new stock bonus plan that invests primarily in Common
Stock of Cone Mills Corporation. Members were afforded the
opportunity of transferring from the SRP to the EEP all or any
portion of their SRP account balances as of June 30, 1989.
Effective July 1, 1989 members could make salary-reduction
contributions of 2% to 10% of salary and direct that the
contribution be made to the SRP or EEP or divided between the two
plans. Cone's matching contributions remained at 25% of salary
reduction contributions not in excess of 6% of salary to the SRP
and were set at 50% of such members' contributions to the EEP.
If a member contributes more than 6% to both Plans, the 6%
limitation is divided between the SRP and EEP in the same
proportion as the member elects to divide his salary reduction
<PAGE>
contribution.
Effective January 1, 1993 hourly employees were added to the
class of employees eligible to participate in the Plan. In
addition, amendments to the Plan required quarterly valuation and
reporting of member account balances, gave members the right to
change their contribution percentages and SRP investment fund
selection quarterly, added a third investment choice in the SRP
and subject to certain restrictions, provided limited rights to
transfer funds from the EEP to the SRP.
The Plan document was amended and restated to incorporate all
amendments that became effective on or before September 1, 1993.
The effective date of the amended and restated Plan document was
September 1, 1993 except with respect to those provisions that
were required to be effective earlier pursuant to the Tax Reform
Act of 1986 and except as otherwise provided therein.
Effective January 1, 1994, the Supplemental Retirement Program of
Cone Mills Corporation was amended, restated and renamed The
401(K) Program of Cone Mills Corporation. An amendment to the
Program increased the amount members could contribute from 10% to
15% of compensation on the same terms and conditions as
previously provided. As amended and restated, the Program
consists of four separate plans: the Supplemental Retirement
Plan, a newly adopted Supplemental Retirement Plan - Hourly ("SRP
- - Hourly"), the Employee Equity Plan, and a newly adopted
<PAGE>
Employee Equity Plan - Hourly ("EEP - Hourly"). Accounts as of
December 31, 1993, in the SRP and EEP of Members who were
compensated on an hourly wage basis were transferred to the
respective SRP - Hourly and EEP - Hourly. Members who were
compensated on an hourly wage basis as of December 31, 1993,
became Members of such hourly plans and employees who were
compensated on a salary basis remained as members of the
Supplemental Retirement Plan and Employee Equity Plan. The
account of a Member whose classification of pay status changes
during a calendar quarter shall be allocated to the respective
plans in accordance with his or her classification at the end of
the calendar quarter.
Cone intends to continue the SRP as a profit-sharing plan
(assigned plan number 003) and to maintain the SRP-Hourly as a
profit-sharing plan (assigned plan number 17) by incorporating
all amendments described above and any other changes required by
applicable law or regulation effective or to become effective at
the time of adoption of this amended and restated 401(k) Program.
Cone intends to maintain the EEP as a stock bonus plan (assigned
plan number 016) and the EEP-Hourly as a stock bonus plan
(assigned plan number 18) by incorporating all provisions
required by applicable law effective or to become effective at
the time of adoption of this amended and restated 401(k) Program.
The Supplemental Retirement Plan and the SRP - Hourly are funded
<PAGE>
through the Master Trust Agreement for the Supplemental
Retirement Plan and the Supplemental Retirement Plan - Hourly of
Cone Mills Corporation. The Employee Equity Plan and the
Employee Equity Plan - Hourly are funded through the Master Trust
Agreement for the Employee Equity Plan and Employee Equity Plan
of Cone Mills Corporation.
Any word in this Plan with an initial capital not expected by
ordinary capitalization rules is a defined term. Definitions not
found in the Plan are in the Internal Revenue Code or the
Employee Retirement Income Security Act, both laws as amended to
the present time. The masculine gender where appearing in the
Plan includes the feminine gender unless the context clearly
indicates otherwise. Article and Section headings are included
for convenience of reference and do not affect the Plan terms in
any way.
<PAGE>
ARTICLE I
DEFINITIONS
1.01. Account means a Member's interest under the Plan
according to Plan provisions. A Member may have
several named accounts in this Plan. When Account is
used without modification, it means the sum of all the
Member's Accounts in this Plan. See also: CODA
Account, Cone Contributions Account and Voluntary
Account. Accounts as of December 31, 1993, in the SRP
and EEP of Members who were compensated on an hourly
wage basis were transferred as of January 1, 1994, to
the respective SRP - Hourly and EEP - Hourly. Accounts
of Members who were compensated on a salary basis
remained in the Supplemental Retirement Plan and the
Employee Equity Plan. An account of a member whose pay
classification changes during a calendar quarter shall
be credited to the hourly or salary plans according to
his or her status as of the end of the calendar
quarter.
1.02. Actual Deferral Percentage or ADP is defined in Plan
Section 3.04(b).
1.03. Advisory Committee means the committee appointed by
Cone Mills Corporation which is responsible for general
administration of the Plan.
1.04. Affiliate means a member of the same controlled group
of corporations as defined in Code Section 1563(a) as
Cone Mills Corporation.
<PAGE>
1.05. Alternate Payee means a Member'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 a Member.
1.06. Annual Additions is defined in Plan Section 4.06.
1.07. Approved Leave means an individual's nonworking period
granted by an Employer for reasons relating to:
(a) accident, sickness or disability:
(b) job-connected education or training;
(c) government service, including jury duty, whether
elective or by appointment; or
(d) terminal leave, with or without pay.
Approved Leaves shall be granted pursuant to policies
that are uniformly applied to all individuals, with no
discrimination in favor of Highly Compensated Employees
as defined in Code Section 414(q). Approved Leave also
means an individual's nonworking period during which he
is absent from work due to compulsory service in the
Armed Forces of the United Services and such period
thereafter as his job rights are protected by law.
1.08. Beneficiary or Beneficiaries means one or more
individuals or other entities so designated by a Member
according to Plan Section 6.07, or if there is no
effective designation, then as specified in that
<PAGE>
Section. Despite the preceding, to the extent provided
in a Qualified Domestic Relations Order as defined in
Code Section 414(p), or to the extent provided in any
domestic relations order entered before
January 1, 1985, under which payments have begun,
Beneficiary means the Spouse, former Spouse, child or
other dependent of a Member who is recognized by that
order as having a right to receive all or a portion of
any benefits payable under the Plan on behalf of such
Member.
1.09. Board of Directors means the Board of Directors of Cone
Mills Corporation.
1.10. Break in Service is defined for Full-Time Employees in
subsection (a) and is defined for Part-Time Employees
in subsection (b).
(a) A Full-Time Employee has a one-year Break in
Service for each twelve-consecutive-month Period
of Severance.
(b) A Part-Time Employee has a one-year Break in
Service during each Plan Year in which he receives
credit for fewer than 501 Hours of Service after
crediting Hours of Service according to Internal
Revenue Code Sections 410(a)(3)(E) and
411(a)(6)(E) regarding maternity and paternity
absences.
1.11. CODA Account means the sum of a Member's EEP CODA
Account and his SRP CODA Account.
1.12. CODA Contributions means the Employers' contributions
<PAGE>
described in Plan Section 3.01 caused by Salary-
Reduction Elections and includes both EEP CODA
Contributions and SRP CODA Contributions.
1.13. Code means the Internal Revenue Code as amended by the
Tax Reform Act of 1986, as amended from time to time.
1.14. Compensation means base Salary, wages, overtime
earnings, vacation pay, holiday pay, service awards,
severance pay, incentive pay, bonuses, commissions,
supervisors' supplement and other similar compensation,
but does not include pension or profit sharing benefits
or other benefits and contributions paid by any
Employer (other than contributions caused by the
Member's salary-reduction elections that are not
includable in his gross income by reason of Code
Sections 125 or 402(e)(3)), stock option payments,
moving or regular expense allowances, moving expense
reimbursements, retainers, fees under contract,
mortgage interest differential payments, imputed income
resulting from personal use of company cars or from
group term life insurance coverage, or any other
similar compensation not related to actual earnings as
an employee. Notwithstanding the foregoing, the annual
Compensation of each member taken into account under
the Plan for any Plan Year shall not exceed $200,000
($150,000, effective for Plan Years beginning January
1, 1994) as adjusted for increases in cost-of-living in
accordance with Code Sections 401(a)(17) and 415(d).
<PAGE>
In determining the compensation of a Member for
purposes of this limitation, the rules of Code Section
414(q)(6) shall apply, except in applying such rules,
the term "family" shall mean only the Spouse of the
Member and any lineal descendants of the member who
have not attained age 19 before the close of the Plan
Year. If as a result of the application of such rules
the adjusted $200,000 ($150,000, effective for Plan
Years beginning January 1, 1994) limitation is
exceeded, the limitation shall be prorated among the
affected individuals in proportion to each such
individual's Compensation determined under this Section
1.14 prior to application of the limitation. The
Compensation of an Employee described in the last
sentence of Section 1.28 of the Plan shall be
determined in accordance with the special rules set
forth in Code Section 406(b)(2).
1.15. Computation Period means a consecutive twelve-month
period beginning with an Employee's Employment
Commencement Date and succeeding anniversaries of such
date and in addition, for Part-Time Employees, a Plan
Year.
1.16. Cone means Cone Mills Corporation, a North Carolina
corporation, the Plan sponsor.
1.17. Cone Contributions means the Employer Contributions
described in Plan Section 3.02 and includes both EEP
Cone Contributions and SRP Cone Contributions.
<PAGE>
1.18. Cone Contributions Account means the sum of a Member's
EEP Cone Contributions Account and his SRP Cone
Contributions Account.
1.19. Continuous Service means an Employee's period of
employment with an Employer or an Affiliate beginning
with his Employment Commencement Date and continuing
until his Severance from Service Date. If an Employee
is reemployed or returns to work after a Severance from
Service and his Continuous Service completed before his
Severance from Service is not required to be recognized
under this Plan, his period of employment with an
Employer or an Affiliate is Continuous Service
beginning on the date on which he again is credited
with an Hour of Service for the performance of duties
and continuing until his later Severance from Service
Date. Continuous Service includes all employment even
though as a non-Member. For purposes of eligibility to
participate in the Plan and vesting, the Continuous
Service of an Employee who quits, retires or is
discharged includes his Period of Severance (up to a
maximum of 12 months) if he again performs an Hour of
Service with an Employer or an Affiliate before the
first anniversary of the date he quit, retired or was
discharged, and the Continuous Service of an Employee
who is absent for any reason other than quit,
retirement or discharge and who has a Severance from
Service before the first anniversary of such absence
<PAGE>
includes the period of time between the Severance from
Service Date and the first anniversary of the absence
if he again performs an Hour of Service with an
Employer or an Affiliate before the first anniversary
of the absence.
1.20. EEP and defined terms incorporating EEP means the Cone
Mills Corporation Employee Equity Plan when used with
respect to an employee compensated on a salaried basis
and the Cone Mills Corporation Employee Equity Plan -
Hourly ("EEP - Hourly") when used with respect to an
employee compensated on an hourly wage basis.
1.21. EEP CODA Contributions means CODA Contributions made to
the EEP pursuant to Salary-Reduction Elections.
1.22. EEP CODA Contributions Account means a Member's Account
to which his EEP CODA Contributions are allocated.
1.23. EEP Cone Contributions means Cone Contributions made to
the EEP pursuant to Plan Section 3.02.
1.24. EEP Cone Contributions Account means a Member's Account
to which EEP Cone Contributions are allocated.
1.25. EEP Voluntary Contributions Account means a Member's
Account to which amounts transferred from the Member's
Supplemental Retirement Plan Voluntary Contributions
Account pursuant to Member elections in accordance with
the Plan provisions in effect on May 1, 1989 are
allocated.
1.26. Effective Date means with respect to this amended and
<PAGE>
restated Plan, January 1, 1994, except with respect to
those provisions that have an earlier effective date
pursuant to the Tax Reform Act of 1986, or as otherwise
provided. The trust for each plan has an effective
date contained in the first trust agreement executed
for that plan.
1.27. Eligible Employee is defined in Plan Section 2.02.
1.28. Employee is an individual who renders personal services
for an Employer or an Affiliate, in an employer-
employee relationship, as defined for Federal Insurance
Contribution Act purposes and Federal Employment Tax
purposes, including Code Section 3401(c). A Full-Time
Employee is an individual who, according to a policy
uniformly applied in similar situations, is scheduled
to work the standard number of hours for his job
classification. A Part-Time Employee is one who,
according to a policy uniformly applied in similar
situations, is scheduled to work less than the standard
number of hours for full-time job classifications.
Employee shall included Leased Employees within the
meaning of Code Sections 404(n)(2) and 414(o)(2) unless
such Leased Employees are covered by a plan described
in Code Section 414(n)(5) and such Leased Employees do
not constitute more than 20% of the recipient's
nonhighly compensated work force. For purposes of the
Plan, a citizen or resident of the United States who
<PAGE>
an employee of a foreign entity in which Cone directly
or through other entities has not less than a ten
percent (10%) interest in the voting stock thereof (or,
in the case of an entity other than a corporation, in
the profits thereof) shall be treated as an Employee of
Cone if Cone has entered into an agreement under Code
Section
3121(l) with respect to such foreign entity and if no
contributions under a funded plan of deferred
compensation are provided by any person other than Cone
with respect to the remuneration paid to such
individual by the foreign entity.
1.29. Employer means an entity described in Plan Section
10.01.
1.30. Employment Commencement Date means the first day for
which an Employee is credited with an Hour of Service.
The Employment Commencement Date for any Employee who
has Rule of Parity Years is the first day after those
Rule of Parity Years for which that Employee is
credited with an Hour of Service for the performance of
duties.
1.31. ERISA means the Employee Retirement Income Security Act
of 1974, as amended from time to time.
1.32. Forfeiture refers to any part of a Member's Account
under this Plan to which he is not entitled to receive
by reason of the vesting rules of Plan Article V.
1.33. Hour of Service
(a) An Hour of Service is each hour for which an
Employee is paid or is entitled to payment for the
<PAGE>
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
Employee is paid or is entitled to payment by an
Employer or an Affiliate in a period during which
no duties are performed (regardless of whether the
relationship has terminated) because of vacation,
holiday, illness, incapacity, layoff or Approved
Leave, but:
(1) no more than 501 Hours of Service are
credited under this subsection (b) to an
individual for any single continuous period
during which he performs no duties (whether
or not the period occurs in a single
Computation Period);
(2) an hour for which an individual is directly
or indirectly paid, or is entitled to
payment, because of a period during which no
duties are performed, is not credited to him
if that payment is made or is due under a
plan maintained solely for the purpose of
complying with applicable worker's
compensation, unemployment compensation or
disability insurance laws; and
(3) Hours of Service are not credited for a
payment that solely reimburses an individual
for his medical or medically related expenses
<PAGE>
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 that entity directly or indirectly
through a trust fund or insurer to which that
entity contributes or pays premiums, and
regardless of whether contributions made or due to
the trust fund or insurer or other funding vehicle
are for the benefit of particular individuals or
are on behalf of a group of individuals.
(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 must not be
credited both under subsection (a) or (b) and also
under this subsection (c). Thus, for example, if
an individual receives a back-pay award following
a determination that he was paid at an unlawful
rate for Hours of Service previously credited, he
is not entitled to additional credit for the same
Hours of Service. 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 the subsection. For
<PAGE>
example, not more than 501 Hours of Service are
required to be credited for payments of back pay,
to the extent that the back pay is agreed to or
awarded for a period of time during which an
individual did not or would not have performed
duties.
(d) For determining Hours of Service for reasons other
than the performance of duties, the special rule
in 29 C.F.R. 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 the units of time, by dividing the
payment in question by the individual's most
recent hourly rate of pay.
(e) When crediting Hours of Service to Computation
Periods, the special rule in 29 C.F.R. 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 of duties.
(f) The determination of Hours of Service must be made
from records of hours worked and hours for which
payment is made or due.
(g) For purposes of determining Hours of Service
<PAGE>
credited according to the maternity and paternity
absence provisions of Code Section 410(a)(5)(E)
and Code Section 411(a)(6)(E), those provisions
are first effective for Plan Years beginning after
1984.
1.34. Investment Committee means the Committee appointed by
Cone that, prior to August 20, 1992, had authority to
manage, acquire or dispose of the assets of the Plan
then in effect in accordance with and subject to Plan
Section 8.08 (as in effect prior to August 20, 1992) or
to appoint one or more Investment Managers for such
purpose. The Investment Committee was discontinued
effective August 20, 1992.
1.35. Investment Earnings means the net gain or loss of an
Investment Fund from interest and dividends received or
accrued, realized and unrealized gains and losses on
securities and any other investment transactions, less
expenses paid or chargeable to the Investment Fund for
a Plan Year or such interim period within a Plan Year
for which the assets of the Investment Fund are being
valued. Investment Earnings shall be determined on the
basis of generally accepted accounting principles and
assets of an Investment Fund as of any Valuation Date
shall be valued on the basis of their current fair
market value.
1.36. Investment Fund means a fund established for the
investment of Trust Fund assets pursuant to Article
VII.
<PAGE>
1.37. Investment Manager means an individual, firm or other
entity appointed by the Board of Directors and assigned
duties as described in Plan Section 8.08.
1.38. Member is defined in Plan Section 2.01.
1.39. Period of Severance means the period of time beginning
on an Employee's Severance from Service Date and ending
on the date on which he is next credited with an Hour
of Service for the performance of duties.
1.40. Plan means the 401(K) Program of Cone Mills Corporation
as described in this document. The Program consists of
the Employee Equity Plan, a stock bonus plan (plan
number 016), the Employee Equity Plan - Hourly, a stock
bonus plan (plan number 18) the Supplemental Retirement
Plan, a profit sharing plan (plan number 003), and the
Supplemental Retirement Plan - Hourly, a profit sharing
plan (plan number 17).
1.41. Plan Year means a twelve (12) month period beginning on
January 1 and ending on December 31 and shall be the
"limitation year" for purposes of Code Section 415.
1.42. Prior Plan means the Supplemental Retirement Program of
Cone Mills Corporation as in effect on
September 1, 1993.
1.43. Rule of Parity Years means Years of Service which are
disregarded for eligibility, vesting or other service
credit under the Plan. Rule of Parity Years only apply
to an Employee: (1) who has not joined either the EEP
or the SRP, (2) who has at least five consecutive one-
<PAGE>
year Breaks in Service, and (3) whose total consecutive
one-year Breaks in Service exceed prior Years of
Service.
1.44. Salary means compensation which is fixed in amount and
stipulated to be regularly paid by one or more
Employers for a definite period, which shall be a week
or more in duration as differentiated from wages,
commissions, bonuses or the guaranty of earnings for
wage earners over any stated period.
1.45. Salary-Reduction Election means the election described
in Plan Section 3.01, regardless of whether the
election is made with respect to base Salary, wages, or
other Compensation.
1.46. Severance from Service Date means the earliest of:
(a) the date an Employee quits, retires, is discharged
or dies; or
(b) the first anniversary of the date from which an
Employee remains absent from work (with or without
pay) for any other reason such as layoff,
disability, or Approved Leave; except that, for an
Employee who is absent from work by reason of a
maternity or paternity absence described in Code
Section 410(a)(5)(i)(E) or Code Section
411(a)(6)(i)(E) and who continues to be absent
from work beyond the first anniversary of the
first day of such maternity or paternity absence,
his Severance from Service Date is the second
<PAGE>
anniversary of the first day of such absence and
the period between the first day and second
anniversaries is neither a period of Continuous
Service nor a Period of Severance; and except
that, for an Employee who is absent from work by
reason of compulsory military service, his
Severance from Service Date is the 91st day
following his discharge from active duty.
An Employee's Severance from Service Date may be
postponed by the Advisory Committee under established
policy uniformly applied in similar situations. For
purposes of this Plan, an Employee has a Severance from
Service on his Severance from Service Date.
1.47. Spouse means the individual legally married to a
Member. Surviving Spouse means the individual legally
married to a Member on the date of such Member's death.
An individual is not a Spouse or a Surviving Spouse
after the marriage to the Member is legally ended for
reasons other than death of the Member.
1.48. SRP and define terms incorporating SRP means the Cone
Mills Corporation Supplemental Retirement Plan when
used with respect to an employee compensated on a
salaried basis and the Cone Mills Corporation
Supplemental Retirement Plan - Hourly ("SRP - Hourly")
when used with respect to an employee compensated on an
hourly wage basis.
<PAGE>
1.49. SRP CODA Contributions means CODA Contributions made to
the SRP pursuant to Salary-Reduction Elections.
1.50. SRP CODA Contributions Account means a Member's Account
to which his SRP CODA Contributions (including all CODA
Contributions made prior to May 1, 1989) are allocated.
1.51. SRP Cone Contributions means Cone Contributions made to
the SRP pursuant to Plan Section 3.02.
1.52. SRP Cone Contributions Account means a Member's Account
to which his SRP Cone Contributions (including all Cone
Contributions made prior to May 1, 1989) are allocated.
1.53. SRP Voluntary Contributions Account means a Member's
Account to which his Voluntary Contributions are
allocated.
1.54. Trust and Trust Fund refers to a Trust Fund established
for this Plan and the Trust Agreement(s) executed under
this Plan.
1.55. Trust Agreement means any agreement including
amendments executed by a Trustee or Co-Trustee with
Cone to be used in connection with this Plan.
1.56. Trustee of SRP means Trustee designated in Master Trust
Agreement of Supplemental Retirement Plan and
Supplemental Retirement Plan - Hourly dated as of
January 1, 1994 and any amendatory agreements thereto.
<PAGE>
Trustee of EEP means Trustee designated in Master Trust
Agreement of Employee Equity Plan and Employee Equity
Plan - Hourly dated as of January 1, 1994 and any
amendatory agreements thereto. A Co-Trustee is one of
several Trustees so designated under a Trust Agreement.
Unless the context clearly indicates otherwise, the
term Trustee also means Co-Trustees.
1.57. Valuation Date for this Plan means March 31, June 30,
September 30 and December 31 of each Plan Year and any
other date on which a valuation is made in connection
with the payment of benefits.
1.58. Voluntary Contribution means any nondeductible Member
contribution that is not made pursuant to a Salary
Reduction Election.
1.59. Year of Service is defined in (a) for a Part-Time
Employee and in (b) for a Full-Time Employee, but a
Year of Service does not include: (1) service with an
Employer before any termination of employment that
occurred before January 1, 1976; and (2) Rule of Parity
Years.
(a) for a Part-Time Employee, a Plan Year following a
Part-Time Employee's Employment Commencement Date
during which he is credited with at least 1,000
Hours of Service. A Part-Time Employee will be
credited with one Year of Service for his first
full Plan Year if he is credited with at least
1,000 Hours of Service during his initial
Computation Period, regardless of whether he is
credited with at least 1,000 Hours of Service
during such first full Plan Year, provided
<PAGE>
however, a Year of Service shall not be given for
both the initial Computation Period and the first
full Plan Year of employment.
(b) for a Full-Time Employee, twelve months of
Continuous Service (whether or not consecutive).
Months of Continuous Service are aggregated yield
Years of Service.
If a Part-Time Employee becomes a Full-Time Employee
during his initial Computation Period and is credited
with at least 1,000 Hours of Service in such
Computation Period as of the date his change of status
occurred, he is granted a Year of Service and his
Continuous Service shall begin on the first day of the
Computation Period after which the change to Full-Time
status occurred. If he is not credited with at least
1,000 Hours of Service as of the date the change in
status occurred, then he is credited with service as if
he had been a Full-Time Employee during the entire
Computation period.
After completing his initial Computation Period, a
Part-Time Employee who becomes a Full-Time Employee and
who had been credited with at least 1,000 Hours of
Service for the Plan Year during which the change
occurs, retains his Years of Service for pre-change
Plan Years, is credited with a Year of Service for the
Plan Year in which the change occurs, and is credited
<PAGE>
with Continuous Service beginning on the first day of
the Plan Year following the date on which the change
occurs. If a Part-Time Employee becomes a Full-Time
Employee, after completing one Computation Period, and
had not been credited with at least 1000 Hours of
Service for the Plan Year during which the change
occurs, his Continuous Service is credited from the
beginning of the Plan Year in which the change occurs.
If a Full-Time Employee becomes a Part-Time Employee,
he shall receive credit for the number of full years of
Continuous Service completed as of the date the change
occurred and will be deemed to become a Part-Time
Employee on the first day of the Plan Year in which the
date of change occurs. For the Plan Year in which the
change occurs, he shall receive credit, on the basis of
190 Hours of Service per month or fraction thereof, for
the period from the end of his last full year of
Continuous Service to the date of his change in status.
A Full-Time Employee who quits, retires, is discharged
or is otherwise absent from work and who returns as a
Part-Time Employee within 12 months is treated as if he
had changed from a Full-Time Employee to a Part-Time
Employee on the date of his reemployment.
<PAGE>
A Full-Time Employee who quits, retires, is discharged
or is otherwise absent from work and who returns after
the first anniversary of the date on which he quit,
retired, was discharged or otherwise absent from work
as a Part-Time Employee shall have an initial
Computation Period begin on the date of return.
A Part-Time Employee who quits, retires, is discharged
or is otherwise absent from work and who returns as a
Full-Time Employee before the end of the Plan Year in
which such event occurred is treated as if he had been
a Part-Time Employee for the entire Plan Year and is
credited with 190 Hours of Service for each month in
which he is a Full-Time Employee; his Continuous
Service as a Full-Time Employee begins on the first day
of the next Plan Year.
<PAGE>
ARTICLE II
PARTICIPATION
2.01. MEMBER
A Member is an Employee or former Employee who has
begun participation in this Plan or the Prior Plan
according to this Article II. A Member of the
Supplemental Retirement Plan or the Employee Equity
Plan who was compensated as of December 31, 1993 on an
hourly wage basis became as of January 1, 1994 members
of the Supplemental Retirement Plan - Hourly or the
Employee Equity Plan - Hourly. A Member whose
classification of pay status changes during a calendar
quarter shall be deemed to be a Member of the hourly or
salaried plan for that quarter based upon his or her
pay classification as of the end of the calendar
quarter.
An individual whose Account Balance is greater than
zero continues to be a Member for purposes of
provisions relating to allocation of earnings and
losses to his Account and to distributions from his
Account, but is a Member for purposes of allocations of
Cone Contributions only if he was an Eligible Employee
at any time during the Plan Year and CODA Contributions
pursuant to Salary-Reduction Elections in effect during
such Plan Year were made on his behalf and not
withdrawn.
2.02. CONDITIONS OF PARTICIPATION
(a) An Employee shall become an Eligible Employee on
<PAGE>
the January 1 or July 1 coinciding with or next
following his attainment of age twenty-one (21)
and completion of one (1) Year of Service.
(b) An Eligible Employee who is compensated on an
hourly wage basis shall only be eligible to
participate in and shall become a Member of the
SRP - Hourly by electing an SRP CODA Contribution
and shall become a Member of the EEP - Hourly by
electing an EEP CODA Contribution. An Eligible
Employee who is compensated on a salary basis
shall only be eligible to participate in and shall
become a Member of the SRP by electing an SRP CODA
Contribution and shall become a Member of the EEP
by electing an EEP CODA Contribution. An Eligible
Employee's compensation classification as of the
participation date set forth in sub-paragraph (a)
above shall determine to which plan he can enroll
but the Member's pay classification at the end of
each calendar quarter shall be determinative of
which plan his Accounts will be maintained.
(c) Employees who are Leased Employees within the
meaning of Code Sections 414(n)(2) and 414(o)(2)
cannot be Eligible Employees.
(d) Employees who contribute to the Defined
Contribution Pension Plan of the Machine Printers'
and Engravers' Association of the United States
<PAGE>
cannot be Eligible Employees.
2.03. EMPLOYMENT AND ELIGIBILITY STATUS CHANGES
(a) If a Member does not have a Severance from Service
Date but becomes an Employee of an Affiliate that
does not participate in the Plan, or ceases to
make CODA Contributions, he shall become a
suspended Member at the end of the pay period the
change in status occurs.
(b) If an Employee has attained age twenty-one (21)
and has at least one (1) Year of Service and
becomes an Eligible Employee due to transfer from
an Affiliate not participating in the Plan to an
Employer, he may participate in the Plan on the
January 1 or July 1 coinciding with or next
following such transfer. If he is not an Eligible
Employee at the time of such transfer, he shall
become an Eligible Employee according to Plan
Section 2.02.
2.04. PARTICIPATION UPON REEMPLOYMENT
(a) If a Member or Eligible Employee has a Severance
from Service Date and is reemployed, such Member
shall become an Eligible Employee when he first
performs an Hour of Service, unless all of his
Prior Years of Service are disregarded as Rule of
Parity Years.
(b) A Member or Eligible Employee who has a Severance
from Service Date and whose prior Years of Service
<PAGE>
are all disregarded as Rule of Parity Years is
treated as a new Employee for all purposes under
the Plan and participates according to Plan
Section 2.02.
(c) An Employee who is not an Eligible Employee or
Member when he has a Severance from Service Date
shall be treated as a new Employee upon
reemployment and shall participate according to
Plan Section 2.02.
<PAGE>
ARTICLE III
CONTRIBUTIONS
3.01. CODA CONTRIBUTIONS
(a) The Employer's CODA Contribution for a Plan Year
is the total of all reductions in Members'
Compensation for the Plan Year by way of Salary-
Reduction Elections. Each Eligible Employee may
elect to have his Employer make CODA Contributions
on his behalf for a Plan Year in an amount,
expressed as a whole percentage, of not less than
2% or more than 15% of his Compensation, provided,
however, that no Member shall be permitted to have
"Excess Elective Deferrals", which shall mean CODA
Contributions made under this Plan, or any other
qualified plan maintained by an Employer, during
any taxable year, in excess of the dollar
limitation contained in Section 402(g) of the Code
in effect at the beginning of such taxable year.
All CODA Contributions shall be credited to the
Member's EEP CODA Contributions Account or to his
SRP CODA Contributions Account, as directed by the
Member. A Member may divide his CODA
Contributions between the SRP and the EEP provided
that at least 2% of his Compensation is
contributed to each plan.
(b) CODA Contributions elections shall be made on a
form provided by the Advisory Committee.
<PAGE>
Such forms shall authorize the Employer to remit
the aggregate amount of CODA Contributions
designated to be made from Compensation payable to
the Employee by the Employer to the EEP or to the
SRP or to divide such CODA Contributions between
the EEP and SRP. The Employer shall remit CODA
Contributions as soon as practicable, but in no
event later than ninety (90) days following the
end of the pay period for which such contributions
were made.
(c) Members and Eligible Employees will be allowed to
make or change CODA Contributions as of January 1,
April 1, July 1 and October 1 of each Plan Year.
Employees who are or become Eligible Employees
during the Plan Year may become Members of the
Plan by executing the appropriate Salary-Reduction
Election forms authorizing CODA Contributions to
become effective on the January 1 or July 1 next
following the date the election forms are
delivered to the Advisory Committee.
(d) Any Member may elect to cease CODA Contributions
to the Plan by delivering written notice to the
Advisory Committee, such election to be effective
as soon as possible after receipt. Should such
Member desire to rejoin the Plan, he may do so by
submitting a new Salary-Reduction Election to the
<PAGE>
Advisory Committee provided, however, that such
reinstatement will not become effective until the
July 1 or January 1 next following the effective
date on which his earlier CODA Contributions
terminated.
(e) As provided in Section 3.04, the Advisory
Committee may suspend or revoke any Salary-
Reduction Election of any member or cause refunds
of CODA Contributions previously made in the Plan
Year by a Member if it is determined that such
suspension, revocation or refund is necessary to
comply with the limitations and discrimination
tests contained in Section 401(k) of the Internal
Revenue Code.
(f) A Member may assign to this Plan any Excess
Elective Deferrals made during a taxable year of
the Member by notifying the Advisory Committee on
or before March 15 of the following year of the
amount of the excess CODA Contributions to be
assigned to the Plan. A Member is deemed to
notify the Advisory Committee of any Excess
Elective Deferrals that result solely from CODA
Contributions made to this Plan and any other
plans of an Employer. Notwithstanding any other
provisions of the Plan, excess CODA Contributions,
plus any income and minus any loss allocable
thereto, shall be distributed no later than
<PAGE>
April 15 to any Member to whose Account excess
CODA Contributions were assigned for the preceding
year and who claims excess CODA Contributions for
such taxable year.
3.02. CONE CONTRIBUTIONS
(a) The Employer shall contribute respectively to the
EEP and the EEP - Hourly for each Plan Year an
amount equal to 50% of the EEP CODA Contributions
made on behalf of Members of each plan for such
Plan Year. The Employer shall contribute
respectively to the SRP and SRP - Hourly for each
Plan Year an amount equal to 25% of the SRP CODA
Contributions made on behalf of Members of each
Plan for such Plan Year; however, CODA
Contributions made on behalf of any Member in
excess of 6% of his Compensation shall not be
taken into account in determining the Cone
Contribution. If the total CODA Contributions
made on behalf of any Member exceed 6% of his
Compensation, then the 6% of Compensation
limitation will be divided between the EEP and SRP
in the same proportion as the Member elects to
divide the CODA Contributions made on his behalf.
(b) Additional Cone Contributions may be made to the
EEP, the SRP or both, with respect to a Plan Year
or with respect to any three-month period ending
<PAGE>
March 31, June 30, September 30 or December 31, in
such amount as the Board of Directors in its sole
discretion may determine.
(c) Current or accumulated earnings and profits of the
Employer are not required in order for Cone
Contributions to be made. In no event,
however,shall Cone Contributions for any Plan Year
exceed the amount allowed as a deduction for its
fiscal year ended with or nearest the Plan Year
end for which such Cone Contributions are made
under applicable provisions of the Code.
(d) All Cone Contributions shall be paid not later
than the time prescribed in the Code for filing
the federal income tax return of the Employer
including extensions which have been granted for
the filing of such return. The Trustee is not
required to collect Cone Contributions or payments
required by an Employer and is responsible only
for assets received as Trustee.
(e) All contributions to the Trust Fund are
conditioned on their being deductible under
applicable provisions of the Code. If any
deduction for any contribution is not allowed in
whole or in part, then that disallowed portion
must be returned to the contributor, but repayment
must be made no later than one year after the
disallowance. To the extent such disallowance
<PAGE>
represents CODA Contributions made pursuant to
Salary-Reduction Elections of Members, such
contribution shall be returned to the appropriate
Members. For purposes of this Section 3.02, the
disallowance may be made by the opinion of any
court whose decision has become final or by any
disallowance asserted by the Internal Revenue
Service to which Cone agrees.
(f) If any excess 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. To the extent
such mistake-of-fact contribution represents CODA
Contributions made pursuant to Salary-Reduction
Elections of Members, such contributions shall be
returned to the appropriate Members. Earnings of
the Trust Fund attributable to the excess
contribution may not be returned but any losses
attributable thereto must reduce the amount
returned.
3.03. CASH AND NONCASH CONTRIBUTIONS
(a) Cone Contributions and CODA Contributions to the
SRP Trust Fund shall be in cash.
(b) CODA Contributions to the EEP Trust Fund shall be
in cash.
(c) Cone Contributions to the EEP Trust Fund may be in
<PAGE>
the form of either cash or Qualifying Employer
Securities as defined in Section 407(d)(5) of
ERISA. All noncash property contributed to the
Trustee must be valued at its fair market value on
the actual date of acceptance of the property by
the Trustee.
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
(a) CODA Contributions under this Plan are intended to
qualify as cash or deferred arrangements according
to Section 401(k) of the Code. For purposes of
measuring compliance with Section 401(k), the
Supplemental Retirement Plan and the Employee
Equity Plan shall be treated as an aggregated
group and CODA contributions to those plans shall
be aggregated and the Supplemental Retirement Plan
- Hourly and the Employee Equity Plan - Hourly
shall be treated as an aggregated group and CODA
contributions to those plans shall be aggregated.
The deferral percentage tests as described in this
Section 3.04 shall be made for each Plan Year and
shall be applied separately to each aggregated
group. Compliance with such tests will be secured
as provided in this Section 3.04 and in accordance
with applicable provisions of the Code.
(b) Definitions for purposes of deferral percentage
tests are:
<PAGE>
(1) Actual Deferral Percentage (ADP) means the
percentage determined by dividing the sum of
CODA Contributions made on behalf of a Member
which are allocated to his Account for the
Plan Year or portion thereof by his
Compensation for the Plan Year or portion
thereof. The ADP of an Eligible Employee who
does not elect to have CODA Contributions
made on his behalf is zero.
(2) Average ADP means the arithmetic average of
the ADP of all Members and Eligible Employees
as a group.
(3) For any Plan Year, compensation may be given
any meaning which satisfies Code Section
414(s).
(4) Highly Compensated Employee includes highly
compensated active Employees and highly
compensated former Employees.
A highly compensated active Employee includes
any Employee who performs services for the
Employer during the determination year and
who, during the look-back year: (i) received
compensation from the Employer in excess of
$75,000 (as adjusted pursuant to Section
415(d) of the Code); (ii) received
compensation from the Employer in excess of
<PAGE>
$50,000 (as adjusted pursuant in Section
415(d) of the Code) and was a member of the
top-paid group for such year; or (iii) was an
officer of the Employer and received
Compensation during such year that is greater
than 150 percent of the dollar limitation in
effect under Section 415(b)(1)(A) of the
Code. The term highly compensated active
Employee also includes: (i) any Employee who
is both described in the preceding sentence
if the term "determination year" is
substituted for the term "look-back year" and
is one of the 100 Employees who received the
most Compensation from the Employer during
the determination year; and (ii) Employees
who are 5 percent owners at any time during
the look-back year or determination year.
If no officer has satisfied the Compensation
requirement of (iii) above during either a
determination year or look-back year, the
highest paid officer for such year shall be
treated as a Highly Compensated Employee.
For this purpose, the determination year
shall be the Plan Year. The look-back year
shall be the twelve-month period immediately
<PAGE>
preceding the determination year.
A highly compensated former Employee includes
any Employee who has a Severance from Service
(or was deemed to have a Severance from
Service) prior to the determination year,
performs no services for the Employer during
the determination year, and was a highly
compensated active Employee for either his
severance year or any determination year
ending on or after the Employee's 55th
birthday.
If an Employee is, during a determination
year or look-back year, a family member of
either a 5 percent owner who is an active or
former Employee or of a Highly Compensated
Employee who is one of the 10 most Highly
Compensated Employees ranked on the basis of
compensation paid by the Employer during such
year, then the combined ADP for the family
group of which such Employee is a member
(which is treated as one Highly Compensated
Employee) must be determined by combining the
compensation and CODA Contributions of all
the eligible family members, and the combined
<PAGE>
ACP for the family group must be determined
by combining the compensation and Cone
Contributions of all the eligible family
members. For purposes of the Section, family
member includes the Spouse, lineal ascendants
and descendants of the Employee or former
Employee and the Spouses of such lineal
ascendants and descendants.
The determination of who is a Highly
Compensated Employee, including the
determinations of the number and identity of
Employees in the top-paid group, the top 100
Employees, the number of Employees treated as
officers and the compensation that is
considered, will be made in accordance with
Code Section 414(q) and the regulations
thereunder.
(5) Non-Highly Compensated Employee means an
Employee who is neither a Highly Compensated
Employee nor a family member of a Highly
Compensated Employee as defined in Plan
Section 3.04(b)(4).
<PAGE>
(c) The average ADP for any Plan Year cannot exceed
the allowance set forth in the following table:
(A) (B)
If Average Actual Deferral The Average Actual Deferral
Percentage for Eligible Non- Percentage for Eligible Highly
Highly Compensated Employees is:Compensated Employees can be:
2% or less.........................2 times Column A
2% to 8%...........................Column A plus 2
percentage points
Over 8%............................1.25 times Column A
(d) Notwithstanding the foregoing table, to avoid
duplicate use of the limit for any Highly
Compensated Employee in violation of Code Section
401(m)(9), the actual contribution ratio for
Highly Compensated Employees shall be reduced
pursuant to Treasury Regulation 1.401(m)-2 and
Plan Section 3.05(f).
(e) In the case of a Highly Compensated Employee who
is a Member or Eligible Employee and who is
eligible to have CODA Contributions made on his
behalf to individual accounts under two or more
Employer plans described in Section 401(a) or
401(k) of the Code, all such contributions shall
be treated as if made to a single plan for
purposes of determining the ADP for any Plan Year.
(f) CODA Contributions made on behalf of any Member
who is a Highly Compensated Employee, that in the
aggregate for any Plan Year, exceed the maximum
amount that can be allocated based on the
<PAGE>
application of the deferral percentage test for
such Plan Year, shall be distributed, to the
extent practicable within two and one half months,
but in no event later than the last day of the
Plan Year next following the year in which such
excess CODA Contributions were made. Such
distributions shall include any income or be
reduced by any loss applicable to the excess CODA
Contributions and shall be made in cash to the
Members on whose behalf excess CODA Contributions
were made. If it appears during a Plan Year that
excess CODA Contributions will be made on behalf
of Highly Compensated Employees, the Advisory
Committee, upon appropriate notice, may reduce, or
suspend entirely current Salary Reduction
Elections in effect for Highly Compensated
Employees or refund a portion of CODA
Contributions previously made in the Plan Year to
the extent necessary to comply with the deferral
percentage tests. The amount of excess CODA
Contributions for a Member who is a Highly
Compensated Employee shall be determined in
accordance with Treasury Regulation 1.401(k)-
1(f)(2). No "gap period" income or loss will be
distributed.
<PAGE>
3.05. CONTRIBUTIONS PERCENTAGE TEST - EMPLOYEE AFTER-TAX
CONTRIBUTIONS AND CONE CONTRIBUTIONS
(a) Contributions by Members on an after-tax basis are
not permitted by this Plan. If such Member
contributions are allowed in the future, they
shall be taken into account for purposes of
applying the tests described in this Section 3.05.
For purposes of measuring compliance with Section
401(m) the Supplemental Retirement Plan and the
Employee Equity Plan shall be treated as an
aggregated group and Cone Contributions to those
plans shall be aggregated and the Supplemental
Retirement Plan - Hourly and the Employee Equity
Plan - Hourly shall be treated as an aggregated
group and Cone Contributions to those plans shall
be aggregated. The contribution percentages tests
as described in this Section 3.05 shall be made
for each Plan Year and shall be applied separately
to each aggregated group Compliance with such
tests will be secured as provided in this Section
3.05 and in accordance with applicable provisions
of the Code.
(b) Definitions for purposes of contributions
percentage tests are:
(1) Actual Contributions Percentage (ACP) means
the percentage determined by dividing the sum
of Cone Contributions and Member
contributions, if any, allocated to his
<PAGE>
Account for the Plan Year or portion thereof
by his Compensation for the Plan Year or
portion thereof. The ACP of an Eligible
Employee who does not receive Cone
Contributions or make Member contributions is
zero.
(2) Average ACP means the arithmetic average of
the ACP for all Members and Eligible
Employees as a group.
(3) Compensation has the meaning given such term
by Plan Section 3.04(b)(3).
(4) Highly Compensated Employee means an Employee
described in Plan Section 3.04(b)(4).
(5) Non-Highly Compensated Employee means an
Employee who is neither a Highly Compensated
Employee nor a family member of a Highly
Compensated Employee as defined in Plan
Section 3.05(b)(5).
(c) The average ACP for any Plan Year cannot exceed
the allowance set forth in the following table:
(A) (B)
If Average Actual Contributions The Average Actual Contributions
Percentage for Eligible Non- Percentage for Eligible Highly
Highly Compensated Employees is: Compensated Employees can be:
2% or less.........................2 times Column A
2% to 8%...........................Column A plus 2
percentage points
Over 8%............................1.25 times Column A
<PAGE>
(d) Notwithstanding the foregoing table, to avoid
duplicate use of the limit for any Highly
Compensated Employee in violation of Code Section
401(m)(9), the actual contribution ratio for
Highly Compensated Employees shall be reduced
pursuant to
Treasury Regulation 1.401(m)-2 and Plan Section
3.05(f).
(e) In the case of a Highly Compensated Employee who
is a Member or Eligible Employee and who is
eligible to receive matching Employer
Contributions and to make Member contributions to
individual accounts under two or more Employer
plans described in Section 401(a) or 401(m) of the
Code, all such contributions shall be treated as
if made to a single plan for purposes of
determining the ACP for any Plan Year.
(f) Cone Contributions made on behalf of any Member
who is a Highly Compensated Employee and Member
contributions that in the aggregate for any Plan
Year exceed the maximum amount that can be
allocated based on the application of the
contributions percentage test for such Plan Year,
shall be distributed, to the extent practicable
within two and one-half months, but in no event
later than the last day of the Plan Year next
following the year in which such excess Cone
Contributions and Member contributions were made.
<PAGE>
Such distributions shall include any income or be
reduced by any loss applicable to the excess Cone
Contributions and Member Contributions and shall
be made in cash to the Members on whose behalf
excess Cone Contributions and Member contributions
were made. If it appears during a Plan Year that
excess Cone Contributions and member contributions
will be made on behalf of Highly Compensated
Employees, the Advisory Committee, upon
appropriate notice, may reduce or suspend entirely
current Member contribution elections in effect
for Highly Compensated Employees or refund a
portion of such contributions previously made in
the Plan Year to the extent necessary to comply
with the contributions percentage tests. The
amount of excess CODA Contributions for a Member
who is a Highly Compensated Employee shall be
determined in accordance with Treasury Regulation
1.401(m)-1(e)(2) and 1.401(m)-2. No "gap period"
income or loss will be distributed.
3.06. DISTRIBUTION RESTRICTIONS
Except as permitted by Plan Section 3.04(f) or 3.05(f),
no distribution from the Plan shall be made to a Member
or his or her Beneficiary or Beneficiaries, in
accordance with such Member's or Beneficiary or
Beneficiaries election, earlier than upon Severance
<PAGE>
from Service, death, disability or the hardship of the
Member as described in Plan Section 6.10.
<PAGE>
ARTICLE IV
ACCOUNTS AND ALLOCATIONS
4.01. INDIVIDUAL ACCOUNTS.
The Advisory Committee shall maintain individual
accounts for each Member in which all amounts allocated
to such Member shall be credited and all distributions
and other withdrawals shall be charged in accordance
with applicable provisions of this Plan. Individual
accounts shall contain the following components or
subaccount as applicable: CODA Contributions Account
consisting of the Member's EEP CODA Contributions
Account and his SRP CODA Contributions Account; Cone
Contributions Account consisting of the Member's EEP
Cone Contributions Account and his SRP Cone
Contributions Account; and Voluntary Contributions
Account consisting of the Member's EEP Voluntary
Contribution Account and his SRP Voluntary Contribution
Account. Each Member's individual account shall
reflect the Investment Funds in which his account
balances are invested pursuant to Plan Article VII.
4.02. CODA CONTRIBUTIONS ACCOUNT.
As of each Valuation Date,the Advisory Committee shall
credit the total value of the contributions made during
the period ending on such Valuation Date by each Member
pursuant to his Salary-Reduction Election to his CODA
Contributions Account.
<PAGE>
4.03. CONE CONTRIBUTIONS ACCOUNT.
(a) As of each Valuation Date, the Advisory Committee
shall compute each Member's share of Cone
Contributions determined for the period ending on
such Valuation Date under Plan Section 3.02 and
allocate such amount to his Cone Contributions
Account as provided herein. Cone Contributions
shall be allocated and credited to the Cone
Contributions Accounts of Members employed on each
Valuation Date and Members who retired, terminated
employment, suspended CODA Contributions or died
during the period ending on such Valuation Date
and who had made CODA Contributions pursuant to
Salary-Reduction Elections in effect during such
period.
(b) Each Member described in paragraph (a) above shall
receive an allocation of Cone Contributions made
pursuant to Plan Section 3.02(a) as follows:
(1) With respect to Cone Contributions made to
the SRP pursuant to Section 3.02(a), each
Member shall be credited with 25% of the
aggregate SRP CODA Contributions made on his
behalf for the applicable Plan Year and not
withdrawn, provided, however, that CODA
Contributions in excess of 6% of his
Compensation shall not be taken into account.
<PAGE>
(2) With respect to Cone Contributions made to
the EEP pursuant to Section 3.02(a), each
Member shall be credited with 50% of the
aggregate EEP CODA Contributions made on his
behalf for the applicable Plan Year and not
withdrawn, provided, however, that CODA
Contributions in excess of 6% of his
Compensation shall not be taken into account.
If the total CODA Contributions made on behalf of
any Member exceed 6% of his Compensation then the
6% of Compensation limitation will be divided
between the SRP and the EEP in the same proportion
as the Member elects to have divided the CODA
Contributions made on his behalf.
(c) Each Member described in paragraph (a) above shall
receive an allocation of Cone Contributions made
pursuant to Plan Section 3.02(b) as follows:
(1) With respect to Cone Contributions made to
the SRP pursuant to Section 3.02(b), each
Member shall be credited with the same
proportion of the additional Cone
Contributions as the SRP CODA Contributions
made on his behalf for the applicable Plan
Year or other period and not withdrawn bears
to the total CODA Contributions made on
<PAGE>
behalf of all Members for such Plan Year or
period and not withdrawn; provided, however,
that in its resolutions authorizing any
additional Cone Contributions to the SRP
pursuant to Section 3.02(b), the Board of
Directors may direct that SRP CODA
Contributions in excess of a
specified percentage of Compensation shall be
disregarded, in which case each Member shall
be credited with the same proportion of the
additional Cone Contributions as the SRP CODA
Contributions made on his behalf not in
excess of the specified percentage of
Compensation bears to the total CODA
Contributions made on behalf of all members,
not in excess of the specified percentage of
each individual's Compensation.
(2) With respect to Cone Contributions made to
the EEP pursuant to Section 3.02(b), each
Member shall be credited with the same
proportion of the additional Cone
Contributions as the EEP CODA Contributions
made on his behalf for the applicable Plan
Year or other period and not withdrawn bears
to the total CODA Contributions made on
behalf of all Members for such Plan Year or
period and not
<PAGE>
withdrawn; provided, however, that in its
resolutions authorizing any additional Cone
Contributions to the EEP pursuant to Section
3.02(b), the Board of Directors may direct
that EEP CODA Contributions in excess of a
specified percentage of Compensation shall be
disregarded, in which case each Member shall
be credited with the same proportion of the
additional Cone Contributions as the EEP CODA
Contributions made on his behalf not in
excess of the specified percentage of
Compensation bears to the total CODA
Contributions made on behalf of all members,
not in excess of the specified percentage of
each individual's Compensation.
If the total CODA Contributions made on behalf of
any Member for any applicable Plan Year or other
period exceed the percentage limitation specified
by the Board of Directors in its resolution
authorizing additional Cone Contributions pursuant
to Section 3.02(a), then the percentage of
Compensation Limitation will be divided between
the SRP and the EEP in the same proportion as the
Member elects to have divided the CODA
Contributions made on his behalf.
<PAGE>
4.04. VOLUNTARY CONTRIBUTIONS ACCOUNT.
Members who made Voluntary Contributions as previously
permitted under the Plan shall have a Voluntary
Contributions Account, which shall have as its opening
balance, the amount carried forward from the previous
Plan. Voluntary Member Contributions are not permitted
by this Plan; such Accounts will only share in
Investment Earnings as hereafter provided.
4.05. ALLOCATION OF INVESTMENT EARNINGS.
Investment Earnings as of each Valuation Date shall be
allocated to the individual Accounts of Members as
provided below:
(a) The Trustee shall determine the net Investment
Earnings as of each Valuation Date separately for
each Investment Fund in accordance with generally
accepted accounting principles. The determination
by the Trustee may be accepted as conclusive by
the Advisory Committee.
(b) Investment Earnings for each Investment Fund shall
be allocated as of each Valuation Date to the
individual Accounts of Members in the same
proportion that the dollar value investment of
each Member's individual Account in such
Investment Fund bears to the total dollar value
investment of all Member's individual Accounts in
such Investment Fund. The dollar value investment
eligible to
<PAGE>
share in the allocation of net Investment Earnings
shall be determined by deducting from the value of
each individual Account as of the preceding
Valuation Date the total amount of all single sum
payments or withdrawals and one-half (1/2) the
amount of all installment payments out of such
individual Account; provided however, that the
total amount of all installment payments shall be
deducted if the total amount in an individual
Account as of the preceding Valuation Date is to
be paid out prior to the next succeeding Valuation
Date. The amount eligible to share in the
allocation of net Investment Earnings shall be
increased by adding to the value of each Member's
individual accounts as of the preceding Valuation
Date, one-half of the amount of CODA Contributions
made to such accounts with respect to each Member,
but not withdrawn during the period after the
preceding Valuation Date.
(c) Notwithstanding the foregoing provisions of this
Section 4.05, unrealized gains and losses with
respect to Qualifying Employer Securities held in
the Company Stock Fund shall not be allocated, but
the value of Qualifying Employer Securities
allocated to a Member's EEP Accounts shall be
<PAGE>
determined as of each Valuation Date and reported
to the Member. Qualifying Employer Securities
traded on the New York Stock Exchange with be
valued at their closing price on the Exchange on
the Valuation Date or, if that date is not a
business day, on the immediately preceding
business day.
4.06. MAXIMUM ANNUAL ADDITIONS.
(a) Notwithstanding any other provision of this Plan,
the maximum "Annual Additions" credited to a
Member's Account for any "limitation year" shall
equal the lesser of: (1) $30,000 (or, if greater,
one-fourth of the dollar limitation in effect
under Code Section 415(b)(1)(A)) or (2) twenty-
five percent (25%) of the Member's "415
Compensation" for such "limitation year."
(b) For purposes of applying the limitations of Code
Section 415, "Annual Additions" means the sum
credited to a Member's individual Accounts in the
SRP and the EEP, taken together, for any
"limitation year" of: (1) Cone Contributions, (2)
CODA Contributions, (3) Voluntary Contributions,
(4) Forfeitures, (5) amounts allocated, after
March 31, 1984, to an individual medical account,
as defined in Code Section 415 (1)(2) which is
<PAGE>
part of a pension or annuity plan maintained by
the Employer and (6) amounts derived from
contributions paid or accrued after December 31,
1985, in taxable years ending after such date,
which are attributable to post-retirement medical
benefits allocated to the separate account of a
key employee (as defined in Code Section
419A(d)(3)) under a welfare benefit plan (as
defined in Code Section 419(e) maintained by the
Employer. Except, however, the "415 Compensation"
percentage limitation referred to in paragraph
(a)(2) above shall not apply to: (1) any
contribution for medical benefits (within the
meaning of Code Section 419A(f)(2)) after
separation from service which is otherwise treated
as an "Annual Addition," or (2) any amount
otherwise treated as an "Annual Addition" under
Code Section 415(1)(1).
(c) For purposes of applying the limitations of Code
Section 415, the transfer of funds from one
qualified plan to another is not an "Annual
Addition." In addition, the following are not
CODA Contributions or Voluntary Contributions for
the purposes of Plan Sections 4.06(b)(2) and (3):
(1) rollover contributions (as defined in Code
Sections 402(a)(5), 403(a)(4), 403(b)(8) and
408(d)(3)); (2)
<PAGE>
repayments of loans made to a Member from the
Plan; (3) repayments of distributions received by
an Employee pursuant to Code Section 411(a)(7)(B)
(cash-outs); (4) repayments of distributions
received by an Employee pursuant to Code Section
411(a)(3)(D) (mandatory contributions); and (5)
Employee contributions to a simplified employee
pension excludable from gross income under Code
Section 408(k)(6).
(d) For purposes of applying the limitations of Code
Section 415, "415 Compensation" shall include the
Member's wages, salaries, fees for professional
service and other amounts for personal services
actually rendered in the course of employment with
an Employer maintaining the Plan(including, but
not limited to, commissions paid salesmen,
compensation for service on the basis of a
percentage of profits, commissions on insurance
premiums, tips and bonuses and in the case of a
Member who is an Employee within the meaning of
Code Section 401(c)(1) and the regulations
thereunder, the Member's earned income (as
described in Code Section 401(c)(2) and the
regulations thereunder)) paid during the
"limitation year".
"415 Compensation" shall exclude: (1)(A)
<PAGE>
contributions made by the Employer to a plan of
deferred compensation to the extent that, before
the application of the Code Section 415
limitations to the Plan, the contributions are not
includable in the gross income of the Employee for
the taxable year in which contributed (including
contributions not includable in gross income under
Code Section 402(e)(3)), (B) contributions made by
the Employer to a plan of deferred compensation to
the extent that all or a portion of such
contributions are recharacterized as a voluntary
Employee contribution, (C) Employer contributions
made on behalf of an Employee to a simplified
employee pension plan described in Code Section
408(k) to the extent such contributions are
excludable from the Employee's gross income, (D)
any distributions from a plan of deferred
compensation regardless of whether such amounts
are includable in the gross income of the Employee
when distributed except any amounts received by an
Employee pursuant to an unfunded non-qualified
plan to the extent such amounts are includable in
the gross income of the Employee; (2) amounts
realized from the exercise of a non-qualified
stock option or when restricted stock (or
property) held by an Employee either
<PAGE>
becomes freely transferable or is no longer
subject to a substantial risk of forfeiture; (3)
amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified
stock option; and (4) other amounts which receive
special tax benefits, such as premiums for group
term life insurance (but only to the extent that
the premiums are not includable in the gross
income of the Employee), contributions not
includable in gross income under Code Section 125,
and contributions made by the Employer (whether or
not under a salary reduction agreement) towards
the purchase of any annuity contract described in
Code Section 403(b) (whether or not the
contributions are excludable from the gross income
of the Employee). "415 Compensation" shall be
limited to $200,000 ($150,000, effective for Plan
Year beginning January 1, 1994) (unless adjusted
in the same manner as permitted under Code Section
415(d).
(e) For purposes of applying the limitations of Code
Section 415, the "limitation year" shall be the
Plan Year.
(f) The dollar limitation under Code Section
415(b)(1)(A) stated in paragraph (a)(1) above
shall be adjusted annually as provided in Code
Section 415(d) pursuant to the Regulations. The
<PAGE>
adjusted limitation is effective as of January 1st
of each calendar year and is applicable to
"limitation years" ending with or within that
calendar year.
(g) For the purpose of this Section, all qualified
defined benefit plans (whether terminated or not)
ever maintained by the Employer shall be treated
as one defined benefit plan, and all qualified
defined contribution plans (whether terminated or
not) ever maintained by the Employer shall be
treated as one defined contribution plan.
(h) For the purpose of this Section, if the Employer
is a member of a controlled group of corporations,
trades or businesses under common control (as
defined by Code Section 1563(a) or Code Section
414(b) and (c) as modified by Code Section 415(h)
or is a member of an affiliated service group (as
defined by Code Section 414(m)), all Employees of
such Employers shall be considered to be employed
by as single Employer.
(i) For the purpose of this Section, if this Plan is a
Code Section 413(c) plan, all Employers of a
Member who maintain this Plan will be considered
to be a single Employer.
(j) (1) If a Member participates in more than one
defined contribution plan maintained by the
Employer which have different Anniversary
<PAGE>
Dates, the maximum "Annual Additions" under
this Plan shall equal the maximum "Annual
Additions" for the "limitation year" minus
any "Annual Additions" previously credited to
such Member's accounts during the "limitation
year."
(2) If a Member participates in both a defined
contribution plan subject to Code Section 412 and
a defined contribution plan not subject to Code
Section 412 maintained by the Employer which have
the same Anniversary Date, "Annual Additions" will
be credited to the Member's accounts under the
defined contribution plan subject to Code Section
412 prior to crediting "Annual Additions" to the
Member's accounts under the defined contribution
plan not subject to Code Section 412.
(3) If a Member participates in more than one defined
contribution plan not subject to Code Section 412
maintained by the Employer which have the same
Anniversary Date, the maximum "Annual Additions"
under this Plan shall equal the product of (A) the
maximum "Annual Additions" for the "limitation
year" minus any "Annual Additions" previously
credited under subparagraphs (1) or (2) above,
multiplied by (B) a fraction (i) the numerator of
which is the "Annual Additions" which would be
<PAGE>
credited to such Member's accounts under this Plan
without regard to the limitations of Code Section
415 and (ii) the denominator of which is such
"Annual Additions" for all plans described in this
subparagraph.
(k) Subject to the exception in Section 4.06(p) below,
if an Employee is (or has been) a Member in one or
more defined benefit plans and one or more defined
contribution plans maintained by the Employer, the
sum of the defined benefit plan fraction and the
defined contribution plan fraction for any
"limitation year" may not exceed 1.0.
(l) (1) The defined benefit plan fraction for any
"limitation year" is a fraction (A) the
numerator of which is the "projected annual
benefit" of the Member under the Plan
(determined as of the close of the
"limitation year"), and (B) the denominator
of which is the greater of the product of
1.25 multiplied by the "protected current
accrued benefit" or the lesser of: (i) the
product of 1.25 multiplied by the maximum
dollar limitation provided under Code Section
415(b)(1)(A) for such "limitation year," or
(ii) the product of 1.4 multiplied by the
amount which may be taken into account under
<PAGE>
Code Section 415(b)(1)(B) for such
"limitation year."
(2) For purposes of applying the limitation of
Code Section 415, the "projected annual
benefit" for any Member is the benefit,
payable annually, under the terms of the
Plan determined pursuant to Regulation 1.415-
7(b)(3).
(3) For purposes of applying the limitations of
Code Section 415, "protected current accrued
benefit" for any Member in a defined benefit
plan in existence on July 1, 1982, shall be
the accrued benefit, payable annually,
provided for under question T-3 of Internal
Revenue Service Notice 83-10.:
(m) (1) The defined contribution plan fraction for
any "limitation year" is a fraction (A) the
numerator of which is the sum of the "Annual
Additions" to the Member's accounts as of the
close of the "limitation year" and (B) the
denominator of which is the sum of the lesser
of the following amounts determined for such
year and each prior year of service with the
Employer: (i) the product of 1.25 multiplied
by the dollar limitation in effect under Code
Section 415(c)(1)(A) for such "limitation
year" (determined without regard to Code
<PAGE>
Section 415(c)(6)), or (ii) the product of
1.4 multiplied by the amount which may be
taken into account under Code Section
415(c)(1(B) for such "limitation year."
(2) Notwithstanding the foregoing, the numerator
of the defined contribution plan fraction
shall be adjusted pursuant to Regulation
1.415-7(d)(1) and questions T-6 and T-7 of
Internal Revenue Service Notice 83-10.
(3) For defined contribution plans in effect on
or before July 1, 1982, the Administrator may
elect, for any "limitation year" ending after
December 31, 1982, that the amount taken into
account in the denominator for every Member
for all "limitation years" ending before
January 1, 1983 shall be an amount equal to
the product of (A) the denominator for the
"limitation year" ending in 1982 determined
under the law in effect for the "limitation
year" ending in 1982 multiplied by (B) the
"transition fraction."
(4) For purposes of the preceding paragraph, the
term "transition fraction" shall mean a
fraction (A) the numerator of which is the
lesser of (I) $51,875 or (ii) 1.4 multiplied
by twenty-five percent (25%) of the Member's
<PAGE>
"415 Compensation" for the "limitation year"
ending in 1981, and (B) the denominator of
which is the lesser of (i) $41,500 or (ii)
twenty-five percent (25%) of the Member's
"415 Compensation" for the "limitation year"
ending in 1981.
(5) Notwithstanding the foregoing, for any
"limitation year" in which the Plan is a Top
Heavy Plan, $41,500 shall be substituted for
$51,875 in determining the "transition
fraction."
(n) Notwithstanding the foregoing, for any "limitation
year" in which the Plan is a Top Heavy Plan, 1.0
shall be substituted for 1.25 in paragraph 1(1)
and m(1).
(o) If the sum of the defined benefit plan fraction
and the defined contribution plan fraction shall
exceed 1.0 in any "limitation year" for any Member
in this Plan for reasons other than described in
Section 4.06(p), the Advisory Committee shall then
adjust the numerator of the defined benefit plant
fraction so that the sum of both fractions shall
not exceed 1.0 in any "limitation year" for such
Member.
(p) If (1) the substitution of 1.00 for 1.25 and
$41,500 for $51,875 above or (2) the excess
benefit accruals or "Annual Additions" provided
<PAGE>
for in Internal Revenue Service Notice 82-19 cause
the 1.0 limitation to be exceeded for any Member
in any "limitation year," such Member shall be
subject to the following restrictions for each
future "limitation year" until the 1.0 limitation
is satisfied: (A) the Member's accrued benefit
under the defined benefit plant shall not
increase, (B) no "Annual Additions" may be
credited to a Member's account and (C) no Employee
contributions (voluntary or mandatory) shall be
made under any defined benefit plan or any defined
contribution plan of the Employer.
(q) Notwithstanding anything contained in this Section
to the contrary, the limitations, adjustments and
other requirements prescribed in this Section
shall at all times comply with the provisions of
Code Section 415 and the Regulations thereunder,
the terms of which are specifically incorporated
herein by reference.
4.07. ADJUSTMENTS FOR EXCESSIVE ANNUAL ADDITIONS.
(a) If, as a result of a reasonable error in
estimating a Member's Compensation or other facts
and circumstances to which Regulation 1.415-
6(b)(6) shall be applicable, the "Annual
Additions" under this Plan would cause the maximum
"Annual Additions" to be exceeded for any Member,
<PAGE>
the Advisory Committee shall (1) return any CODA
Contributions credited for the "limitation year"
to the extent that the return would reduce the
"excess amount", in the Member's accounts, (2)
hold any "excess amount" remaining after the
return of any CODA contributions in a "Section 415
suspense account", (3) use the "Section 415
suspense account" in the next "limitation year"
(and succeeding "limitation years" if necessary)
to reduce CODA Contributions for that Member if
that Member is covered by the Plan as of the end
of the "limitation year," or if the Member is not
so covered, allocate and reallocate the "Section
415 suspense account" in the next "limitation
year" (and succeeding "limitation years" if
necessary) to all Members in the Plan before any
Cone or CODA Contributions which would constitute
"Annual Additions" are made to the Plan for such
"limitation year", (4) reduce Cone Contributions
to the Plan for such "limitation year" by the
amount of the "Section 415 suspense account"
allocated and reallocated during such "limitation
year."
(b) For purposes of this Section, "excess amount" for
any Member for a "limitation year" shall mean the
excess, if any, of: (1) the "Annual Additions"
which would be credited to his account under the
<PAGE>
terms of the Plan without regard to the
limitations of Code Section 415, over (2) the
maximum "Annual Additions" determined pursuant to
Section 4.06.
(c) For purposes of this Section, "Section 415
suspense account" shall mean an unallocated
account equal to the sum of "excess amounts" for
all Members in the Plan during the "limitation
year." The "Section 415 suspense account" shall
not share in any earnings or losses of the Trust
Fund.
(d) The Plan may not distribute "excess amounts,"
other than CODA Contributions as provided by the
Code and regulations thereunder, to Members or
former Members.
4.08 DETERMINATION OF TOP HEAVY STATUS.
This Plan shall be a Top Heavy Plan for any Plan Year
in which, as of the Determination Date, (1) the Present
Value of Accrued Benefits of Key Employees and (2) the
sum of the Aggregate Accounts of Key Employees under
this Plan and all plans of an Aggregation Group, exceed
sixty percent (60%) of the Present Value of Accrued
Benefits and the Aggregate Accounts of all Key and Non-
Key Employees under this Plan and all plans of an
Aggregation Group.
This Plan shall be a Super Top Heavy Plan for any Plan
Year in which, as of the Determination Date, (1) the
Present Value of Accrued Benefits of Key Employees and
<PAGE>
(2) the sum of the Aggregate Accounts of Key Employees
under this Plan and all plans of an Aggregation Group,
exceed ninety percent (90%) of the Present Value of
Accrued Benefits and the Aggregate Accounts of all Key
and Non-Key Employees under this Plan and all plans of
an Aggregation Group. If any Member is a Non-Key
Employee for any Plan Year, but such Member was a Key
Employee for any prior Plan Year, such Member's Present
Value of Accrued Benefits and/or Aggregate Account
balance shall not be taken into account for purposes of
determining whether this Plan is a Top Heavy or Super
Top Heavy Plan (or whether any Aggregation Group which
includes this Plan is a Top Heavy Group). In addition,
if a Member or Former Member has not performed any
services for any Employer maintaining the Plan at any
time during the five year period ending on the
Determination Date, any accrued benefit for such Member
or former Member shall not be taken into account for
the purposes of determining whether this Plan is a Top
Heavy or Super Top Heavy Plan.
The following definitions apply in determining whether
the Plan is a Top Heavy Plan or a Super Top Heavy Plan:
(a) Aggregate Account: A Member's Aggregate Account
as of the Determination Date is the sum of:
(1) the Member's Account balance as of the most
recent Valuation Date occurring within a
<PAGE>
twelve (12) month period ending on the
Determination Date;
(2) an adjustment for any contributions due as of
the Determination Date. Such adjustment
shall be the amount of any contributions
actually made after the most recent Valuation
Date but due on or before the Determination
Date, except for the first Plan Year when
such adjustment shall also reflect the amount
of any contributions made after the
Determination Date that are allocated as of a
date in that first Plan Year;
(3) any Plan distributions made within the Plan
Year that includes the Determination Date or
within the four (4) preceding Plan Years.
However, in the case of distributions made
after the most recent Valuation Date and
prior to the Determination Date, such
distributions are not included as
distributions for top heavy purposes to the
extent that such distributions are already
included in the Member's Aggregate Account
balance as of the Valuation Date.
Notwithstanding anything herein to the
contrary, all distributions, including
distributions made prior to January 1, 1984,
and distributions under a terminated plan
<PAGE>
which if it had not been terminated would
have been required to be included in an
Aggregation Group, will be counted. Further,
distributions from the Plan (including the
cash value of life insurance policies) of a
Member's account balance because of death
shall be treated as a distribution for the
purposes of this paragraph.
(4) any Employee contributions, whether voluntary
or mandatory. However, amounts attributable
to tax deductible qualified voluntary
employee contributions shall not be
considered to be a part of the Member's
Aggregate Account balance.
(5) with respect to unrelated rollovers and plan-
to-plan transfers (ones which are both
initiated by the Employee and made from a
plan maintained by one employer to a plan
maintained by another employer), if this Plan
provides the rollovers or plan-to-plan
transfers, it shall always consider such
rollovers or plan-to-plan transfers as a
distribution for the purposes of this
Section.
(6) with respect to related rollovers and plan-
to-plan transfers (ones either not initiated
by the Employee or made to a plan maintained
<PAGE>
by the same employer), if this Plan provides
the rollover or plan-to-plan transfer, it
shall not be counted as a distribution for
purposes of this Section. If this Plan is
the plan accepting such rollover or plan-to-
plan transfer, it shall consider such
rollover or plan-to-plan transfer as part of
the Member's Aggregate Account balance,
irrespective of the date on which such
rollover or plan-to-plan transfer is
accepted.
(7) For the purposes of determining whether two
employers are to be treated as the same
employer in (5) and (6) above, all employers
aggregated under Code Section 414(b), (c),
(m) and (o) are treated as the same employer.
(b) Aggregation Group means either a Required
Aggregation Group or a Permissive Aggregation
Group as hereinafter determined.
(1) Required Aggregation Group: In determining a
Required Aggregation Group hereunder, each
plan of the Employer in which a Key Employee
is a member in the Plan Year containing the
Determination Date or any of the four
preceding Plan Years, and each other plan of
the Employer which enables any plan in which
a Key Employee participates to meet the
<PAGE>
requirements of Code Sections 401(a)(4) or
410, will be required to be aggregated. Such
group shall be known as a Required
Aggregation Group.
In the case of a Required Aggregation Group,
each plan in the group will be considered a
Top Heavy Plan if the Required Aggregation
Group is a Top Heavy Group. No plan in the
Required Aggregation Group will be considered
a Top Heavy Plan if the Required Aggregation
Group is not a Top Heavy Group.
(2) Permissive Aggregation Group: The Employer
may also include any other plan not required
to be included in the Required Aggregation
Group, provided the resulting group, taken as
a whole, would continue to satisfy the
provisions of Code Sections 401(a)(4) and
410. Such group shall be known as a
Permissive Aggregation Group.
In the case of a Permissive Aggregation
Group, only a plan that is part of the
Required Aggregation Group will be considered
a Top Heavy Plan if the Permissive
Aggregation Group is a Top Heavy Group. No
<PAGE>
plan in the Permissive Aggregation Group
will be considered a Top Heavy Plan if the
Permissive Aggregation Group is not a Top
Heavy Group.
(3) Only those plans of the Employer in which the
Determination Dates fall within the same
calendar year shall be aggregated in order to
determine whether such plans are Top Heavy
Plans.
(4) An Aggregation Group shall include any
terminated plan of the Employer if it was
maintained within the last five (5) years
ending on the Determination Date.
(c) Determination Date means (a) the last day of the
preceding Plan Year, or (b) in the case of the
first Plan Year, the last day of such Plan Year.
(d) Key Employee means an Employee as defined in Code
Section 416(i) and the Regulations thereunder.
Generally, any Employee or former Employee (as
well as each of his Beneficiaries) is considered a
Key Employee if he, at any time during the Plan
Year that contains the "Determination Date" or any
of the preceding four(4) Plan Years, has been
included in one of the following categories:
(i) an officer of the Employer (as that term is
defined within the meaning of the Regulations
under Code Section 416) having annual "415
<PAGE>
Compensation" greater than 150 percent (150%)
of the amount in effect under Code Section
415(b)(1)(A) for any such Plan Year.
(ii) one of the ten employees having annual "415
Compensation" from the Employer for a Plan
Year greater than the dollar limitation in
effect under Code Section 415(c)(1)(A) for
the calendar year in which such Plan Year
ends and owning (or considered as owning
within the meaning of Code Section 318) both
more than one-half percent (0.5%) interest
and the largest interests in the Employer.
(iii) a "five percent owner" of the Employer.
"Five percent owner" means any person who
owns (or is considered as owning within the
meaning of Code Section 318) more than five
percent (5%) of the outstanding stock of the
Employer or stock possessing more than five
percent (5%) of the total combined voting
power of all stock of the Employer or, in the
case of an unincorporated business, any
person who owns more than five percent (5%)
of the capital or profits interest in the
Employer. In determining percentage
ownership hereunder, employers that would
otherwise be aggregated under Code Sections
414(b), (c), (m) and (o) shall be treated as
<PAGE>
separate employers.
(iv) a "one percent owner" of the Employer having
annual "415 Compensation" from the Employer
of more than $150,000. "One percent owner"
means any person who owns (or is considered
as owning within the meaning of Code Section
318) more than one percent (1%) of the
outstanding stock of the Employer or stock
possessing more than one percent (1%) of the
total combined voting power of all stock of
the Employer or, in the case of an
unincorporated business, any person who owns
more than one percent (1%) of the capital or
profits interest in the Employer. In
determining percentage ownership hereunder,
employers that would otherwise be aggregated
under Code Sections 414(b), (c), (m) and (o)
shall be treated as separate employers.
However, in determining whether an individual
has "415 Compensation" of more than $150,000,
"415 Compensation" from each employer
required to be aggregated under Code Sections
414(b), (c), (m) and (o) shall be taken into
account. For purposes of this Section, "415
Compensation" means Compensation as defined
in Plan Section 4.06(d), except that the
<PAGE>
determination of "415 Compensation" shall be
made without regard to Code Sections 125,
402(e)(3), 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).
(e) Non-Key Employee means any Employee or former
Employee (and his Beneficiaries) who is not a Key
Employee.
(f) Present Value of Accrued Benefit In the case of a
defined benefit plan, the Present Value of Accrued
Benefit for a Member other than a Key Employee,
shall be as determined using the single accrual
method used for all plans of the Employer and
Affiliated Employers, or if no such single method
exists, using a method which results in benefits
accruing not more rapidly than the slowest accrual
rate permitted under code Section 411(b)(1)(C).
(g) Top Heavy Group means an Aggregation Group in
which as of the Determination Date, the sum of:
(1) the Present Value of Accrued Benefits of Key
Employees under all defined benefit plans
included in the group, and
(2) the Aggregate Accounts of Key Employees under
all defined contribution plans included in
the group, exceeds sixty percent (60%) of a
similar sum determined for all Members.
<PAGE>
4.09. TOP HEAVY REQUIREMENTS.
(a) Minimum Allocations Required for Top Heavy Plan
Years. For any Top Heavy Plan Year, the sum of
the Employer's contributions and Forfeitures
allocated to the Account of each Non-Key Employee
shall be equal to at least three percent (3%) of
such Non-Key Employee's "415 Compensation"
(reduced by contributions and Forfeitures, if any,
allocated to each Non-Key Employee in any defined
contribution plan included with this Plan in a
Required Aggregation Group). However, if (i) the
sum of the Employer's contributions and
Forfeitures allocated to the Account of each Key
Employee for such Top Heavy Plan Year is less than
three percent(3%) of each Key Employee's "415
Compensation" and (ii) this Plan is not required
to be included in an Aggregation Group to enable a
defined benefit plan to meet the requirements of
Code Section 401(a)(4) or 410, the sum of the
Employer's contributions and Forfeitures allocated
to the Account of each Non-Key Employee shall be
equal to the largest percentage allocated to the
Account of any Key Employee. For the purposes of
this Section, "415 Compensation" shall be limited
to $200,000 ($150,000 effective for Plan Years
beginning January 1, 1994) unless adjusted in such
<PAGE>
manner as permitted under Code Section 415(d).)
For purposes of the minimum allocations set forth
above, the percentage allocated to the Account of
any Key Employee shall be equal to the ratio of
the sum of the Employer's contributions and
Forfeitures allocated on behalf of such Key
Employee divided by the "415 Compensation" for
such Key Employee. For any Top Heavy Plan Year,
the minimum allocations set forth above shall be
allocated to the Accounts of all Non-Key Employees
who are Members and who are employed by the
Employer on the last day of the Plan Year. In
lieu of the above, in any Plan Year in which a
Non-Key Employee is a Member in both this Plan and
a defined benefit pension plan included in a
Required Aggregation Group which is top heavy, the
Employer shall not be required to provide such
Non-Key Employee with both the full separate
defined benefit plan minimum benefit and the full
separate defined contribution plan minimum
allocation.
For purposes of determining minimum allocations,
the CODA Contributions and Cone Contributions for
Highly Compensated Employees shall be taken into
account but the CODA Contributions for Non-Highly
<PAGE>
Compensated Employees shall not be taken into
account.
(b) Minimum Vesting: In accordance with Plan Section
5.01, a Member is 100% vested in his Account at
all times.
(c) Impact on Maximum Benefits: For any Plan Year in
which the Plan is a Top-Heavy Plan, Plan Section
4.06 shall be applied by substituting the number
"1.00" for the number "1.25" wherever it appears
therein except such substitution shall not have
the effect of reducing any benefit accrued under a
defined benefit plan prior to the first day of the
Plan Year in which this provision becomes
applicable.
(d) Notwithstanding anything contained herein to the
contrary, the requirements prescribed in this
Section shall at all times comply with the
provisions of Code Section 416 and the Regulations
thereunder, the terms of which are specifically
incorporated herein by reference.
<PAGE>
ARTICLE V
VESTING
5.01. VESTED ACCOUNTS.
(a) Each Member's CODA Contributions Account and
Voluntary Contributions Account, if applicable,
are nonforfeitable (100% vested).
(b) (1) If, before January 1, 1989, a Member had a
voluntary Severance from Service Date (other
than by retirement or death) and had incurred
a one-year Break in Service, his Cone
Contributions Accounts are vested
(nonforfeitable) according to the following
schedule:
Vested Percentage
Years of Service Cone Contributions
After age 18 Account
Less than 4, 0%
4 but less than 5 50%
5 or more 100%
Before January 1, 1989, a Member's Cone
Contributions Accounts were 100% vested on the
earlier of his 65th birthday (normal retirement
date) or his death, or at his involuntary
Severance from Service Date.
(2) Each Member of the Plan who is employed by an
Employer on or after January 1, 1989, and
each Member of the Plan on January 1, 1989,
<PAGE>
who was not then employed by an Employer but
who had not yet incurred a one-year Break in
Service is 100% vested in his Cone
Contributions Accounts.
5.02. FORFEITURES.
For Plan Years beginning on and after January 1, 1989,
each Member's Accounts in the SRP and EEP are
nonforfeitable (100% vested); therefore, no Forfeitures
shall occur or shall be subject to allocation in such
Plan Years.
<PAGE>
ARTICLE VI
DISTRIBUTION OF BENEFITS
6.01. CLAIM PROCEDURE.
The Advisory Committee may require any person entitled
to benefits to complete an application for payment and
to select the method under which benefits are to be
paid. If a claim is wholly or partially denied, the
Advisory Committee will furnish the claimant a written
explanation within ninety days unless special
circumstances require an extension of time. If an
extension is needed, the Advisory Committee will notify
the claimant before the ninety-day period expires
informing him that the written explanation will be sent
within the second ninety-day period. The written
notice will state: (1) the specific reason or reasons
for denial; (2) specific reference to pertinent Plan
provisions on which the denial is based; (3) a
description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such material or information is
necessary; and (4) appropriate information as to the
steps to be taken if the member or Beneficiary wishes
to submit the claim for review.
6.02. REVIEW OF CLAIMS.
The claimant or a duly authorized representative may,
within sixty days after receipt by the claimant of a
written notification or denial of a claim: (1) request
<PAGE>
a review by the Advisory Committee upon written
application to the Committee; (2) review pertinent
documents; and (3) submit issues and comments in
writing. A decision by the Advisory Committee shall be
made promptly but in any event not later than
sixty days after receipt of a request for
review unless special circumstances require
an extension of time, in which event a
decision shall be rendered not later than one
hundred twenty days after receipt of such
request. Written notice of any such
extension shall be furnished to the claimant
prior to the commencement of the extension.
The decision on review shall be in writing,
shall include specific reasons for the
decision and shall be furnished to the
claimant within the appropriate time
described in this Section 6.02.
6.03. DISTRIBUTION DEFINITIONS.
(a) Spousal Consent means with respect to a Member's
election to designate a Beneficiary other than his
Spouse, the Spouse's written consent to the
Beneficiary or Beneficiaries designated, which
Beneficiary or Beneficiaries may not be changed
without a further Spousal Consent (unless the
Spousal Consent expressly permits changes without
a further Spousal Consent).
<PAGE>
(b) Spouse or Surviving Spouse is defined in Plan
Section 1.47.
6.04. METHODS OF PAYMENT.
(a) After a Member has a Severance from Service Date
and submits the appropriate claim forms, election
forms and income tax withholding forms, and
subject to the rights of any Alternate Payee under
a Qualified Domestic Relations Order, the Advisory
Committee shall direct the Trustee to distribute
the vested portion of the Member's Accounts by one
of the following methods as elected by such
Member:
(1) In a single, lump sum distribution.
(2) In monthly installments of a specified amount
over a fixed period not to exceed the life
expectancy of the Member or the joint life
expectancies of the Member and his designated
Beneficiary.
(3) By a combination of the methods set forth in
(1) and (2) above.
The Advisory Committee may adjust installment
elections so as not to be administratively
burdensome.
Not earlier than 90 days, but (except as
hereinafter provided) not later than 30 days,
before a distribution is made or begun, the
Advisory Committee must provide a benefit notice
<PAGE>
to a Member who is eligible to make an election
under this Section 6.04. The benefit notice must
explain the optional forms of benefit and the
Member's right to defer distribution until he
attains age 65. If a distribution is one to which
Code Sections 401(a)(11) and 417 do not apply,
such distribution may commence less than 30 days
after the notice required under Section 1.411(a)-
11(c) of the Income Tax Regulations is given,
provided that (i) the Advisory Committee clearly
informs the Member that the Member has a right to
a period of at least 30 days after receiving the
notice to consider the decision of whether or not
to elect a distribution or a particular
distribution option and (ii) the Member, after
receiving the notice, affirmatively elects a
distribution.
(b) If a Member has a Severance from Service and the
vested portion of his Cone Contributions Account
is $3,500 or less, distribution will only be made
in a single lump sum amount or direct trustee-to-
trustee transfer; in such event, the Member shall
not be entitled to elect any other method of
payment pursuant to paragraph (a) above. If the
vested portion of such Member's Account is over
$3,500, distribution before the Member's sixty-
fifth birthday shall be made only with the consent
<PAGE>
of the Member.
(c) If a Member's Beneficiary is not the Member's
Spouse, a monthly installment distribution method
may not be elected if it provides for payments
during the Member's life expectancy that are less
than 50% of the present value of the total
payments to be made to the Member and his
Beneficiary. Life expectancy shall be determined
by use of tables, prepared on a unisex basis, and
contained in U. S. Treasury Department
Regulations.
(d) Distributions from the Plan must be in cash,
except that the receiving Member may elect to
receive his distribution from the EEP in the form
of Qualifying Employer Securities unless such a
distribution is restricted according to the
Employer's bylaws or articles of incorporation.
If a Member entitled to a stock distribution has
assets other than Qualifying Employer Securities
forming part of the vested portion of his EEP
Accounts, and if he exercises his right to elect
to receive such Qualifying Employer Securities,
those other assets must be converted at fair
market value (in accordance with Plan Section
6.11) into any Qualifying Employer Securities to
which he may be entitled by Code Section
401(a)(23) or 409(h), as selected by the Advisory
Committee, and then distributed. Balances
<PAGE>
representing fractional shares may be paid in
cash. The Advisory Committee may direct the
Trustee of the EEP to obtain Qualifying Employer
Securities necessary for distribution from
whatever source might be available to the Trustee.
If the Trustee cannot find other Qualifying
Employer Securities available for conversion, the
Advisory Committee may direct the Trustee to
purchase Qualifying Employer Securities from the
EEP Accounts of other Members. The issuer of a
security to be distributed may impose any transfer
restrictions allowable under state or federal
securities laws on any stock distributed pursuant
to this subsection.
(e) In the case of a distribution of Qualifying
Employer Securities which are not readily tradable
on an established securities market, the EEP shall
provide the Member with a put option that complies
with the requirements of Section 409(h) of the
Code. Such put option shall provide that if a
Member exercises the put option, the Employer, or
the EEP if the EEP elects to assume the Employer's
obligation, shall repurchase the Qualifying
Employer Securities as follows:
(1) If the distribution constitutes a total
distribution of the vested portion of a
<PAGE>
Member's EEP Accounts, payment of the fair
market value of the Member's account balance
shall be made in a lump sum or in annual
installments over a period not exceeding five
years. If paid in installments, the first
installment shall be paid not later than 30
days after the Member exercises the put
option. The purchaser will pay a reasonable
rate of interest and provide adequate
security on amounts not paid after 30 days.
(2) If the distribution does not constitute a
total distribution of the vested portion of a
Member's EEP Account, the purchaser shall pay
the Member an amount equal to the fair market
value of the Qualifying Employer Securities
repurchased no later than 30 days after the
Member exercises the put option.
(f) Shares of Qualifying Employer Securities
distributed by the Plan shall be subject to the
"right of first refusal" described in this Section
6.04(f) so long as they are not readily tradable
on an established securities market. Prior to any
transfer of such shares, the shares must first be
offered in writing to the Trustee of the EEP and
then if refused by the Trustee, to Cone at a price
equal to the purchase price offered by a third
<PAGE>
party buyer (other than the Trustee of the EEP or
Cone) making a good faith (as determined by the
Advisory Committee) offer to purchase such shares;
provided, however, that the Trustee shall in no
event purchase shares at a price in excess of
their fair market value. The Trustee of the EEP
or Cone, as the case may be, may accept the offer
as to part or all of the Qualifying Employer
Securities at any time during the period not
exceeding 14 days after receipt of such offer by
the Trustee, on terms and conditions no less
favorable to the shareholder than those offered by
the third-party buyer. Any installment purchase
shall be made pursuant to a note secured by the
shares purchased and shall bear a reasonable rate
of interest. If the offer is not accepted by the
Trustee of the EEP, Cone, or both, then the
proposed transfer may be completed within a 30-day
period following the end of the aforementioned 14-
day period, but only upon terms and conditions no
less favorable than the terms and conditions of
the third-party buyer's original offer. If the
proposed transfer is not completed within the
aforementioned 30-day period, then the shares will
again be subject to the right of first refusal
described in this Section 6.04(f).
6.05. COMMENCEMENT OF BENEFITS.
<PAGE>
(a) Subject to Plan Section 6.11, the valuation of
a Member's Accounts for purposes of determining
the amount of benefit payment(s) is made as of the
Valuation Date immediately following the date on
which he becomes eligible for such payment(s)
pursuant to this Section 6.05.
(b) Unless a Member elects otherwise, benefit payments
must begin no later than 60 days after the close
of the Plan Year in which occurs the latest of:
(1) his 65th birthday;
(2) the 10th anniversary of the date he became a
Member of the Plan; or
(3) his Severance from Service.
(c) A Member who has an involuntary Severance from
Service and who receives Approved Leave with or
without pay shall be eligible to receive a
distribution of the balance in his Accounts in
accordance with Plan Section 6.04 within 75 days
of the Valuation Date immediately following his
last day of active employment, provided that the
Member terminates his election to have CODA
Contributions made on his behalf to the Plan so
that no further CODA Contributions will be made
after such Valuation Date.
(d) If for any reason the benefit amount cannot be
accurately determined before payment is required,
<PAGE>
or if it is not possible to pay when required
because the Advisory Committee has been unable to
locate the Member, after making reasonable efforts
to do so, a payment retroactive to the required
date may be made not later than 60 days after the
earliest date on which the amount of that payment
can be determined, or the date on which the Member
is located (whichever is applicable).
(e) Distributions pursuant to this Section 6.05(e) may
be requested by a Member who has a Severance from
Service date prior to January 1, 1993, and by the
Beneficiary of a Member who dies before January 1,
1993. A distribution pursuant to this Section
6.05(e) shall begin or be made, subject to Section
6.05(d), within 90 days of the Valuation Date
immediately following such Severance from Service
Date or Death. At the election of the Member or
Beneficiary, up to 90% of the value of the
Member's Accounts as of the Valuation Date
immediately preceding the Severance from Service
Date or death will be distributed within 15 days
after the Valuation Date immediately following
such Severance from Service Date or death, with
the balance distributed by April 1 or October 1
following the applicable Valuation Date.
(f) Distributions pursuant to this Section 6.05(f) may
<PAGE>
be requested by a Member who has a Severance from
Service Date after December 31, 1992, and by the
Beneficiary of a Member who dies after
December 31, 1992. A distribution pursuant to
this Section 6.05(f) shall begin or be made,
subject to Section 6.05(d), within 75 days of the
Valuation Date immediately following such
Severance from Service Date or death.
6.06. SPECIAL DISTRIBUTION PROVISIONS.
(a) Distribution of the entire interest of a Member
must be or begin no later than April 1 of the
calendar year following the calendar year in which
he attains age 70-1/2 whether or not he has a
Severance from Service. If distribution has not
started by the required beginning date described
in the preceding sentence, it must begin not later
than that required beginning date and be payable
over a period not exceeding the life of the
Member, or the life expectancy of the Member, or
the lives of the Member and a designated
Beneficiary, or the life expectancies of the
Member and a designated Beneficiary. Life
expectancy shall be determined in accordance with
U. S. Treasury Department regulations and may be
redetermined annually.
(b) If the distribution of a Member's account has
begun in accordance with paragraph (a) and the
<PAGE>
Member dies before his entire Account balance has
been distributed, the remaining portion of his
Account balance must be distributed at least as
rapidly as under the method of distribution being
used as of the date of the Member's death. If a
Member dies before the distribution of his Account
balance has begun, his entire Account balance must
be
distributed within five years after his death.
6.07. DEATH BENEFITS.
(a) Subject to the rights of any Alternate Payee under
a Qualified Domestic Relations Order, if a Member
having a vested interest in the Plan dies before
receiving a distribution of his Account balance
with a Surviving Spouse, his vested Account
balance, valued in accordance with Plan Section
6.11, shall be distributed to the Surviving Spouse
in accordance with subsection (b), unless the
Member had made an effective election pursuant to
subsection (c).
(b) Unless the Surviving Spouse elects a later date,
distribution of the Member's vested Account
balance shall be made or begin no later than 60
days after the end of the Plan Year in which death
occurs, except as permitted under Plan Section
6.05(d). Payment shall be made under one of the
methods provided in Plan Section 6.04.
<PAGE>
Notwithstanding the foregoing, if the aggregate
amount of the Member's vested Account balance is
$3,500 or less, such amount shall be distributed
to the Surviving Spouse in a single lump-sum
payment. No distribution shall be made pursuant
to this subsection (b) until the Advisory
Committee has received proof of the Member's death
and appropriate claim, election and tax
withholding forms.
(c) A Member may designate a Beneficiary or
Beneficiaries (other than his Spouse) in
accordance with subsection (d) to receive death
benefits under this Plan; provided, however, that
no Beneficiary designation in accordance with
subsection (d) shall be effective unless
accompanied by a Spousal Consent. A Member may
revoke any Beneficiary designation and, subject to
any required Spousal Consent, may designate
another Beneficiary or Beneficiaries.
(d) On forms provided by the Advisory Committee, each
Member without a Spouse and, subject to Spousal
Consent, each Member with a Spouse may designate
or change a Beneficiary or Beneficiaries to
receive death benefits under the Plan. A
Beneficiary designation is effective when received
by the Advisory Committee. Any designation of a
Beneficiary by a Member without a Spouse shall
<PAGE>
become void and of no further force and effect if
the Member later marries. If a Beneficiary or
Beneficiaries are designated in accordance with
this subsection (d), and if distribution of
benefits under this Plan has not begun before a
Member's death, then, after the Advisory Committee
receives proof of the Member's death, it shall
request his Beneficiary or Beneficiaries to submit
claim, election and tax withholding forms.
Subject to the rights of any Alternate Payee under
a Qualified Domestic Relations Order, the Advisory
Committee, upon receiving these forms, shall
direct the Trustee to distribute the Member's
Account, valued no later than the end of the Plan
Year during which death occurs, to his Beneficiary
or Beneficiaries. Distribution will be made or
begin no later than 60 days after the end of the
Plan Year in which death occurs, except as
permitted under Plan Section 6.05(d), and, subject
to Plan Section 6.06(b), shall be made by one of
the methods described in Plan Section 6.04, as
elected by the Beneficiary or Beneficiaries.
Notwithstanding the foregoing, if the amount
distributable under this subsection (d) is $3,500
or less, such amount shall be distributed in a
single lump sum payment. If a Member had elected
<PAGE>
installment payments pursuant to Plan Section 6.04
and had designated a Beneficiary or Beneficiaries
in accordance with this subsection (d), then any
installment payments becoming due after his death
shall be made to the Beneficiary or Beneficiaries
so designated, unless they elect to accelerate
payment thereof. If there is no effective
beneficiary designation in effect at the time of a
Member's death, then subject to any required
Spousal Consent and to the rights of any Alternate
Payee, the Member's estate shall be entitled to
receive his vested Account balance.
6.08. QUALIFIED DOMESTIC RELATIONS ORDER.
Except as provided in this Section 6.08, Plan benefits
may not be assigned, alienated or in any other way made
subject to debts or other obligations of Members of
Beneficiaries. Notwithstanding the above, the Advisory
Committee must comply with the terms of a Qualified
Domestic Relations Order which is a judgment, decree or
order (including approval of a property settlement
agreement) made pursuant to a state domestic relations
law (including community property law), that relates to
the provision of child support, alimony payments or
marital property rights of a Spouse, former Spouse,
child or other dependent ("Alternate Payee") of a
Member. A Qualified Domestic Relations Order creates
<PAGE>
or recognizes the existence of an Alternate Payee's
right to, or assigns to an Alternate Payee the right
to, receive all or a portion of the benefits payable to
a Member under his Plan and specifies the following:
(1) the name and last know mailing address of the
Member and each Alternate Payee;
(2) the amount or percentage of the Member's Plan
benefits to be paid to any Alternate Payee,
or the manner in which such amount or
percentage is to be determined; and
(3) the number of payments or the period to which
the Order applies and the name of the plan(s)
to which the Order relates.
Plan benefits will be paid pursuant to a Qualified
Domestic Relations Order to such Alternative Payee(s)
at such times and in such amounts as are stated
therein, provided however, that such Qualified Domestic
Relations Order may not require the Plan to provide any
type or form of benefit, or any option not otherwise
provided. It also may not require the Plan to provide
increased benefits and may not require the payment of
benefits to an Alternate Payee prior to the Member's
"earliest retirement age" as defined in Code Section
414(p). The Advisory Committee shall establish
reasonable procedures to determine the qualified status
of domestic relations orders and to administer
distributions under such Orders.
<PAGE>
6.09. WITHHOLDING OF BENEFITS.
If a Member has a Severance from Service and returns to
regular employment of the Employer, the Advisory
Committee may suspend payment of any benefit which such
Member would have received from the Plan during any
such period of reemployment.
6.10. HARDSHIP WITHDRAWAL.
(a) Upon written application on forms provided by the
Advisory Committee and subject to the provisions
of this Section 6.10, a Member shall be permitted
to withdraw a specified whole dollar amount from
the vested balance in his individual Accounts to
the extent such withdrawal is necessary to meet
the following documented immediate and heavy
financial need of the Member:
(1) medical expenses described in Code Section
213(d) of the Member, his Spouse or
dependents;
(2) purchase (excluding mortgage payments) of a
principal residence of the Member;
(3) tuition and related education fees (but not
room and board) for the next twelve (12)
months of post-secondary education for the
Member, his Spouse, or dependents;
(4) the need to prevent eviction of the Member
from his principal residence or foreclosure
<PAGE>
on the mortgage of his principal residence;
plus, any amounts necessary to pay any
federal state or local income taxes or
penalties reasonably anticipated to result
from the distribution.
No such withdrawal shall be permitted to the
extent that the immediate and heavy financial need
proposed to be met thereby may be met from other
resources that are reasonably available to the
Member and, for this purpose, the Member's
resources shall be deemed to include those assets
of his Spouse and minor children that are
reasonably available to the Member. Accordingly,
no withdrawal from a Member's Accounts shall be
permitted unless the Member has represented to the
Advisory Committee in writing that his immediate
and heavy financial need cannot be relieved: (1)
through reimbursement or compensation by insurance
or otherwise; (2) by reasonable liquidation of the
Employee's assets, to the extent such liquidation
would not itself cause an immediate and heavy
financial need; (3) by cessation of elective
contributions or Employee contributions under the
Plan; (4) by other distributions or nontaxable
loans from plans maintained by Cone or by any
<PAGE>
other Employer of the Member; or (5) by borrowing
from commercial sources on reasonable commercial
terms. Amounts withdrawn shall be in the
following order: (1) a portion or all of the SRP
Voluntary Contributions Account; (2) a portion or
all of the EEP Voluntary Contributions Account;
(3) a portion or all of the SRP Cone Contributions
Account; (4) a portion or all of the SRP CODA
Contributions Account; (5) a portion or all SRP
Investment Earnings attributable to Plan Years
ending before January 1, 1989; (6) a portion or
all of the EEP Cone Contributions Account; (7) a
portion or all of the EEP CODA Contributions
Account. Subject to paragraph (b), the maximum
amount subject to withdrawal is the vested balance
in the Member's Accounts as of the end of the Plan
Year immediately preceding the date of
application, but in no event shall a withdrawal be
in excess of the amount necessary to meet the
immediate and heavy financial need of the Member,
and a withdrawal of less than $300 shall not be
permitted.
b) Beginning January 1, 1989, the amount of any
hardship withdrawal cannot exceed the sum of
the Member's Accounts, including Investment
Earnings thereon attributable to Plan Years
ending before January 1, 1989, (but excluding
<PAGE>
Investment Earnings thereon attributable to
Plan Years ending after December 31, 1988,
and all Investment Earnings attributable to
the EEP Company Stock Fund). The order of
withdrawal rules in paragraph (a) will apply.
(c) The determination required to be made under this
Section 6.10 by the Advisory Committee shall be
made in a uniform and non-discriminatory manner on
the basis of all relevant facts and circumstances.
Hardship withdrawals are not subject to the
Advisory Committee's discretion, except to the
extent reasonably necessary to determine whether
the conditions set forth in paragraph (a) have
been met, and the Claim Procedure set forth in
Section 6.01 shall apply. The Advisory Committee
shall be entitled to rely on information and
documentation supplied by a Member in connection
with his written application for a hardship
withdrawal, pursuant to this Plan Section 6.10.
6.11. VALUATION OF ACCOUNT BALANCES.
For purposes of determining the amount of any
distribution, a Member's Accounts will be determined as
of the Valuation Date immediately preceding the date of
the distribution, except that cash distributions from
the EEP after December 31, 1992, that are attributable
to common stock of Cone will be based on the closing
<PAGE>
price of the common stock on the sixtieth day following
such Valuation Date or, if the sixtieth day is not a
business day, the immediately preceding business day.
6.12. WITHHOLDING OF TAXES.
Notwithstanding any other term or provision of this
Article VI, the Advisory Committee will direct the
Trustee to deduct from any distribution made to a
Member such amount as is required to be withheld under
Code Section 3405 and the corresponding provision of
any applicable state law.
6.13. ELIGIBLE ROLLOVER DISTRIBUTIONS.
(a) This Section 6.13 applies to distributions made on
or after January 1, 1993. Notwithstanding any
provision of the Plan to the contrary that would
otherwise limit a distributee's election under
this Section, a distributee may elect, at the time
and in the manner prescribed by the Advisory
Committee, to have any portion of an eligible
rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a
direct rollover.
(b) Definitions.
(1) Eligible rollover distribution: An eligible
rollover distribution is any distribution of
all or any portion of the balance to the
credit of the distributee, except that an
<PAGE>
eligible rollover distribution does not
include: any distribution that is one of a
series of substantially equal periodic
payments (not less frequently than annually)
made for the life (or life expectancy) of the
distributee or the joint lives (or joint life
expectancies) of the distributee and the
distributee's designated beneficiary, or for
a specified period of ten years or more; any
distribution to the extent such distribution
is required under Section 401(a)(9) of the
Code; and the portion of any distribution
that is not includable in gross income
(determined without regard to the exclusion
for net unrealized appreciation with respect
to employer securities).
(2) Eligible retirement plan: An eligible
retirement plan is an individual retirement
account described in Section 408(a) of the
Code, an individual retirement annuity
described in Section 408(b) of the Code, an
annuity plan described in Section 403(a) of
the Code, or a qualified trust described in
Section 401(a) of the Code, that accepts the
distributee's eligible rollover distribution.
However, in the case of an eligible rollover
<PAGE>
distribution to the Surviving Spouse, an
eligible retirement plan is an individual
retirement account or individual retirement
annuity.
(3) Distributee: A distributee includes an
Employee or former Employee. In addition,
the Employee's or former Employee's Surviving
Spouse and the Employee's or former
Employee's Spouse or former Spouse who is the
alternate payee under a Qualified Domestic
Relations Order, as defined in section 414(p)
of the Code, are distributed with regard to
the interest of the Spouse or former Spouse.
(4) Direct rollover: A direct rollover is a
payment by the Plan to the eligible
retirement plan specified by the distributee.
<PAGE>
ARTICLE VII
INVESTMENT OF ACCOUNTS
7.01. INVESTMENT FUNDS.
(a) The Trustee of the SRP shall establish and
maintain three Investment Funds. The first fund,
known as the Fixed Income Fund, shall be invested
in interest bearing accounts, certificates of
deposit, money market securities and other
interest bearing investments which involve a
minimum or no risk to principal. The second fund,
known as the Balanced Fund, shall be invested
primarily in common and preferred stocks,
corporate and government bonds, debentures and
other evidences of indebtedness. The third fund,
known as the Diversified Common Stock Fund, shall
be invested primarily in common stocks. The
Trustee of the SRP shall establish and maintain
other Investment Funds if directed to do so by the
Board of Directors. The Investment Funds
maintained by the Trustee of the SRP shall be
utilized in investing the individual SRP Accounts
of Members and Beneficiaries.
(b) Plan assets held in the SRP Trust Fund and
attributable to Members' SRP CODA Contributions
and SRP Voluntary Contributions, that is, any
funds allocated or allocable to SRP CODA
Contributions Accounts or SRP Voluntary
<PAGE>
Contributions Accounts shall not be invested in
any securities or other properties whatsoever of
Cone or Affiliates.
(c) The Trustee of the EEP shall establish and
maintain two Investment Funds. The first fund,
known as the Company Stock Fund, shall be invested
solely in Qualifying Employer Securities (as
defined in Section 407(d)(5) of ERISA). The
second fund, known as the Other Investments Fund
shall be invested in interest bearing accounts,
certificates of deposit, money market securities
and other interest bearing investments which
involve a minimum or no risk to principal. The
Investment Funds maintained by the Trustee of the
EEP shall be utilized in investing the individual
EEP Accounts of Members and Beneficiaries.
7.02. DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS.
(a) At least 30 days prior to each January 1, April 1,
July 1 and October 1 each Member shall have the
right to direct the Advisory Committee as to the
investment of all funds in his individual SRP
Accounts during the next three months. Such
election shall be in writing on a form provided by
the Advisory Committee and shall indicate which
amounts, in 25% increments, are to be invested in
each of the SRP Investment Funds. In the event no
election is made on a timely basis, the Member's
<PAGE>
individual Accounts shall remain invested in the
same manner as during the prior period in
accordance with his last election.
(b) Members shall not have the right to direct the
investment of EEP Accounts. EEP Accounts shall be
invested by the Trustee of the EEP primarily in
the Company Stock Fund, and the Other Investments
Fund will be used primarily as a temporary fund
whose assets will be used to purchase Qualifying
Employer Securities or to make distributions in
accordance with Article VI.
(c) Notwithstanding any other provisions of this
Section 7.02, effective January 1, 1991, a Member
who has attained age 60 and who has an EEP Account
balance may elect on forms provided by the
Advisory Committee, to transfer such balance to
the SRP Investment Funds. Transfers as permitted
by this Section 7.02(c) shall be effective on
January 1 of each Plan Year, with respect to
Members who are age 60 or older on or before the
December 31 Valuation Date immediately preceding
such January 1. The initial transfer by any
Member shall be 50% of the value of his EEP
Account balance as of the December 31 Valuation
Date immediately preceding the January 1 effective
date. A Member shall be allowed a second transfer
effective no sooner than one year after such
<PAGE>
initial transfer; the second transfer shall be the
Member's remaining EEP Account balance. A Member
shall not be allowed more than two transfers
pursuant to this Section 7.02(c). The Advisory
Committee shall restrict rights to transfer by
Highly Compensated Employees which may otherwise
be permitted by this Section 7.02(c) to the extent
necessary to cause compliance with Treasury
Regulation 1.401(a)(4)-4. If restricting transfer
rights by Highly Compensated Employees becomes
necessary, then to the extent required to comply
with Treasury Regulation 1.401(a)(4)-4, the
Advisory Committee shall not allow transfer rights
to be elected by Highly Compensated Employees as
of any applicable December 31 Valuation Date in
the following order:
First - by those Highly Compensated Employees
who have attained age 60.
Second - by those Highly Compensated Employees
who have attained age 61.
Third - by those Highly Compensated Employees
- who have attained age 62.
Fourth - by those Highly Compensated Employees
who have attained age 63.
Fifth - by those Highly Compensated Employees
who have attained age 64 or any older
<PAGE>
age.
(d) Effective January 1, 1993, in accordance with
uniform and nondiscriminatory procedures adopted
from time to time by the Advisory Committee, a
Member who has an EEP Account balance may elect to
transfer such balance to the SRP Investment Funds
over a period of four Plan Years as follows:
(1) For the first Plan Year in which a transfer
is elected, 25% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made;
(2) For the second Plan Year in which a transfer
is elected, 33-1/3% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made;
(3) For the third Plan Year in which a transfer
is elected, 50% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made; and
(4) For the fourth Plan Year in which a transfer
is elected, 100% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
<PAGE>
transfer is made.
Notwithstanding the foregoing, if the total value
of a Member's EEP Account balance does not exceed
$5,000 as of any Valuation Date, he may elect to
have such balance transferred to the SRP
Investment Funds, provided that only one transfer
shall be permitted of an EEP Account balance that
does not exceed $5,000. The Advisory Committee
shall restrict rights to transfer by Highly
Compensated Employees which may otherwise be
permitted by this Section 7.02(d) to the extent
necessary to cause compliance with Treasury
Regulation 1.401(a)(4)-4. If restricting transfer
rights by Highly Compensated Employees becomes
necessary, then to the extent required to comply
with the Treasury Regulation 1.401(a)(4)-4, the
Advisory Committee shall not allow transfer rights
to be elected by Highly Compensated Employees as
of any applicable Valuation Date in the following
order:
(i) By those Highly Compensated Employees
described in Code Section 414(q)(1)(A)
or (B).
(ii) By those Highly Compensated Employees
described in Code Section 414(q)(1)(C)
and not included in category (i) above.
(iii)By those Highly Compensated Employees
<PAGE>
described in Code Section 414(q)(1)(D)
and not included in category (i) or (ii)
above.
7.03. SEGREGATED ACCOUNT.
If a terminated Member's or Beneficiary's distribution
is payable in installments which extend more than 6
months after the normal payment date for a lump sum
distribution, then, as of the January 1 coinciding with
or next following the date on which the election to
receive installment payments is made, the individual
SRP Accounts shall be invested in the Fixed Income Fund
and, subject to Plan Section 6.04(d), the individual
EEP Accounts shall be invested in the Other Investments
Fund.
<PAGE>
ARTICLE VIII
TRUST FUND AND ADMINISTRATION OF THE PLAN
8.01. NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY.
(a) Plan Fiduciaries are Cone (acting through the
Board of Directors), each Trustee or Co-Trustee,
the Advisory Committee and any other Committee
appointed pursuant to Plan Section 8.06. Each
Fiduciary shall have only those powers, duties,
responsibilities and obligations that are
specifically assigned under the Plan or Trust
Agreement. A Fiduciary may serve in more than one
capacity with respect to the Plan. The Board of
Directors shall appoint the Advisory Committee and
any Trustee or successor Trustees or Co-Trustees
and any other Fiduciaries.
(b) Each Trustee has custody and sole responsibility
for administration of the Trust Fund of which it
is the Trustee, but a Trustee's authority to
manage, acquire or dispose of assets of the Plan
is subject to such investment policies and
guidelines as may be adopted from time to time by
the Board of Directors and communicated to such
Trustee. If an Investment Manger is appointed
according to a Trust Agreement, the Trustee or
each Co-Trustee under that Trust Agreement is
released from any obligation or liability for the
<PAGE>
investment of the assets for which the appointment
is made.
(c) The Advisory Committee has only the
responsibilities described in this Plan and those
delegated by Cone. The Advisory Committee has no
responsibility for the control or management of
the Trust Fund.
(d) Other Committees appointed pursuant to Plan
Section 8.06 shall have such authority and
responsibilities as may be delegated by the Board
of Directors.
(e) All responsibilities not specifically delegated to
a Fiduciary remain with Cone, including
designating other Fiduciaries not named in this
Plan or the Trust Agreement. A Fiduciary serves
at the pleasure of Cone and may employ one or more
persons to render advice with regard to any
responsibility such Fiduciary has under the Plan.
Each Fiduciary may rely upon any direction,
information or action of another Fiduciary, as
being proper under the Plan or Trust Agreement and
shall not be required to inquire into the
propriety of any such direction, information or
action. It is intended that each Fiduciary be
responsible for the proper exercise of its own
power, duties, responsibilities and obligations
and shall not be responsible for any act or
omission of another Fiduciary except to the extent
that he has knowledge of a breach of Fiduciary
<PAGE>
responsibility by another Fiduciary and fails to
make reasonable effort to remedy the breach.
8.02. DUTIES AND RESPONSIBILITIES.
Each Fiduciary shall discharge his duties with respect
to the Plan solely in the interest of Members and
Beneficiaries for the exclusive purpose of providing
benefits to Members and Beneficiaries and for defraying
reasonable expenses in administering the Plan, with the
care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man acting
in a like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character
and with like aims, and in accordance with the
documents and instruments governing the Plan insofar as
such documents and instruments are consistent with the
provisions of applicable law or regulation.
Notwithstanding the foregoing, the diversification
requirement of ERISA Section 404(a)(1)(C) and the
prudence requirement of ERISA Section 404(a)(1)(B) (to
the extent it requires diversification) shall not apply
to the acquisition and holding of Qualifying Employer
Securities as defined in ERISA Section 407(d) by the
EEP.
8.03. TRUST FUND.
All of the assets of the Plan shall be held in a Trust
Fund or Funds under a Trust Agreement or Agreements
<PAGE>
which shall be a part of the Plan. Any such Trust
Agreement may provide for a master trust containing
assets of more than one plan if the portion or
percentage attributable to each plan is clearly
established and discernible. Each Trustee or Co-
Trustee shall be appointed by the Board of Directors,
and the Board of Directors shall have the sole
authority to appoint and remove any Trustee, Co-Trustee
or successor Trustee or Co-Trustee. All contributions
shall be paid into a Trust Fund. Benefits provided by
the Plan shall be payable from the Trust Fund. The
Trustee or Co-Trustee shall execute such documents and
take any other action necessary to carry out the
instructions of any Investment Manager or the Advisory
Committee.
8.04. ENFORCEABLE RIGHTS.
Cone does not guarantee payment of any benefits
provided for under the Plan. All rights of Members and
Beneficiaries shall be enforceable only against the
Trust Fund except to the extent otherwise guaranteed by
applicable law or regulation. No person shall have any
interest in or right to any part of the corpus or
income of the Trust Fund except as provided in the
Plan.
<PAGE>
8.05. IMPOSSIBILITY OF DIVERSION.
Except as provide in Section 3.02, the assets of the
Plan and the Trust Fund shall not inure to the benefit
of the Employer and shall be held for the exclusive
purposes of providing benefits to Members and
Beneficiaries and defraying reasonable expenses of
administering the Plan.
8.06. ADVISORY COMMITTEE AND OTHER COMMITTEES.
The Board of Directors shall appoint an Advisory
Committee and may appoint other Committees from time to
time, each Committee to consist of at least three (3)
persons who may, but need not be, officers, directors
or Employees of Cone. The members of each Committee
shall hold office at the pleasure of the Board of
Directors and shall serve without compensation. Each
Committee member shall file his written acceptance with
the Board of Directors and acknowledge that he is a
Fiduciary under the Plan. Any Committee member may
resign at any time by delivering his written
resignation to the Board of Directors. Any vacancy
which reduces Committee membership to less than three
shall be filled by the Board of Directors as soon as
practicable.
8.07. OFFICERS, QUORUMS, EXPENSES.
Each Committee may authorize one or more of its members
to execute or deliver any instrument or act on its
behalf. Each Committee shall hold meetings upon such
notice and at such place and times as it may determine.
<PAGE>
A majority of the members of each Committee in office
at the time shall constitute a quorum for the
transaction of business. All resolutions or other
actions taken by a Committee shall be by the vote of a
majority of those present at a meeting or without a
meeting by an instrument in writing signed by a
majority of the members. If a Committee member
registers his dissent in writing with respect to any
act or omission by the majority, delivered to the
remaining Committee members within a reasonable time,
such member shall not be responsible for such act or
omission. The expenses of each Committee in performing
its duties and the compensation of its agents shall be
paid by Cone.
8.08. DUTIES OF INVESTMENT MANAGER.
Cone shall have authority to appoint in writing and
obtain the services of one or more Investment Mangers
(as defined in ERISA Section 3(38) whose duties and
responsibilities shall be to manage the investment and
reinvestment of such portion of the Trust Fund as shall
be determined from time to time by the Board of
Directors. Each duly appointed Investment Manager
shall, with respect to the portion of any Trust Fund
for which it is responsible, have the sole authority,
without prior consultation with the Trustee or Cone, to
manage, acquire and dispose of assets of the Trust Fund
but shall not, except to the extent permitted in the
<PAGE>
Trust Agreement, have physical custody or indicia of
ownership of any such assets. The appointment of an
Investment Manger shall become effective as of the date
it delivers to Cone a written statement acknowledging
that it is Fiduciary as defined in ERISA Section
3(21)(A) and that it has the responsibility of
acquisition and disposition of that portion of Trust
Fund assets assigned to it. The Investment Manager
shall exercise its power through written directions to
the Trustee signed by an individual whose name and
signature appears on a list furnished by such
Investment Manager to Cone. The Investment Manager
shall periodically deliver to Cone a report describing
all Trust Fund asset transactions for each agreed upon
reporting period. Any compensation or fee due to the
Investment Manger for services rendered shall be paid
out of the Trust Fund, unless paid by Cone in its
discretion.
8.09. INFORMATION TO INVESTMENT MANAGER.
Cone shall advise each Investment Manager of the amount
of that portion of any Trust Fund which it is to
manage, the amount of Cone and CODA Contributions to be
added to the Fund and the expected future benefits to
be payable from the Fund in order that the Investment
Manager may establish a funding policy consistent with
current and long-term needs of the Plan and compatible
with the investment policies and guidelines determined
by the Board of Directors.
<PAGE>
8.10. NOTICE TO TRUSTEE.
Cone shall notify the Trustee of each Trust Fund for
which an Investment Manager has been appointed of the
name of such Investment Manager and the portion of the
Trust Fund for which such Manager is responsible.
Until notified in writing by Cone that there has been a
change in the appointment of an Investment Manager, the
Trustee shall be fully protected in relying upon the
instructions received from such Investment Manager with
respect to the portions of the Fund for which such
Manager has investment responsibilities.
8.11. DUTIES OF THE ADVISORY COMMITTEE.
The Advisory Committee shall be responsible for and
have discretionary authority with respect to
interpretation of the provisions of the Plan, the
determination of benefits and the right of any person
to benefits, and such other functions including without
limitation the promulgation of rules and regulations as
may be necessary for proper administration of the Plan
and not hereunder delegated to the Trustee, Investment
Manager or other Fiduciary appointed by the Board of
Directors. The Advisory Committee's rules,
interpretations, computations and actions with be
conclusive and binding on all persons. Individual
members of the Advisory Committee may exercise
jurisdiction and take actions with respect to
administration of the Plan provided such actions are
<PAGE>
consistent with the proposes of and authorized by the
Plan.
8.12. NOTICE OF PAYMENTS DUE.
The Advisory Committee shall notify the Trustees in
writing of the amounts payable under the Plan and the
date of such payments.
8.13. RECORDS AND REPORTS.
The Advisory Committee shall maintain or shall direct
the Trustees to maintain accounts showing the fiscal
transactions of the Plan and shall keep or direct the
Trustees to keep in convenient form such data as may be
necessary for the valuation of the assets and
liabilities, contingent or otherwise, of the Plan. The
Committee shall exercise such authority as it deems
appropriate in order to comply with the reporting
requirements of any applicable law or regulation
affecting the Plan and shall prepare annually a report
showing in reasonable detail such assets and
liabilities of the Plan and any other information which
the Board of Directors may require and which the
Committee can reasonably furnish or obtain from the
Trustees. Such report shall be submitted to the Board
of Directors.
8.14. EXONERATION OF ADVISORY COMMITTEE.
The members of the Advisory Committee, Employers and
their officers, directors and Employees shall be
entitled to rely upon the reports furnished by any
<PAGE>
Trustee or by any accountant retained by the Committee
or the Board of Directors, and upon all opinions given
by any legal counsel selected or retained by the
Committee or the Board of Directors. Except as
contrary to law, the members of the Committee,
Employers and their officers, directors and Employees
shall be fully protected and exonerated from liability
with respect to any action taken or suffered by them in
good faith in reliance upon such reports, opinions or
other advice received from any such Trustee, accountant
or legal counsel.
The fact that any member of the Committee is a
director, officer or shareholder of the Employer, or a
Member of the Plan, shall not disqualify his from
performing any duties which the Plan or the Trust
Agreements authorize or require him to do as a member
of the Committee or render him accountable for any
benefits received by him under the Plan. All
directors, officers and Employees who are deemed to be
Fiduciaries of this Plan are entitled to
indemnification to the full extent provided for by law
and by the Articles of Incorporation and Bylaws of Cone
in effect on January 1, 1987, or as, thereafter
amended.
8.15. ERRORS AND OMISSIONS.
Individuals and entities charged with the
administration of the Plan must see that it is
administered in accordance with its terms as long as it
<PAGE>
is not in conflict with the Code or ERISA. If an
innocent error or omission is discovered in the Plan's
operation or administration, and if the Advisory
Committee determines that it would cost more to correct
the error than is warranted, and if the Advisory
Committee determines that the error did not result in
discrimination prohibited by Plan Section 11.06 or
cause a qualification or excise tax problem, then, to
the extent that an adjustment will not in the Advisory
Committee's judgment result in discrimination
prohibited by Plan Section 11.06, the Advisory
Committee may authorize any equitable adjustment it
deems necessary or desirable to correct the error or
omission, including but not limited to the
authorization of additional Cone Contributions
designed, in a manner consistent with the goodwill
intended to be engendered by the Plan, to put Members
in the same relative position they would have enjoyed
if there had been no error or omission. Any
contribution made pursuant to this section is an
additional discretionary contribution.
8.16. FEES AND EXPENSES.
Any fees or expenses incurred in connection with the
operation of the Plan shall be paid out of the SRP or
EEP Trust Fund, unless paid by Cone in its discretion.
8.17. VOTING AND TENDERING OF SHARES.
(a) Qualifying Employer Securities held in the Trust
Fund established under the EEP shall be voted by
<PAGE>
the Trustee according to the written instructions
of the Member whose Accounts hold the shares.
Without limiting the generality of the foregoing
and notwithstanding any other provision of this
Plan or the Trust Agreement established under the
EEP, a Member shall be entitled to direct the
Trustee as to the manner in which voting rights
will be exercised with respect to any corporate
matter which involves the voting of Qualifying
Employer Securities allocated to his Accounts.
Shares unallocated as of any voting record date or
shares as to which the Trustee receives no written
instructions shall be voted by the Trustee.
(b) Options and other rights (for example, tender
rights) inuring to the benefit of Qualifying
Employer Securities allocated to a Member's
Account may be exercised by the Trustee only
according to the written instruction of the Member
whose Account holds the shares. Options and
similar rights (for example, tender rights)
inuring to the benefit of unallocated shares must
be exercised by the Trustee according to the same
principles set forth in this Section with regard
to voting rights. Members directions pursuant to
this Section may be itemized or a general
(blanket) authorization.
(c) The Advisory Committee shall take such action as
<PAGE>
may be necessary to ensure that Members of the EEP
receive the same notices, financial statements,
proxies, proxy solicitation materials and other
information as Cone sends to its shareholders
generally.
8.18 CERTIFICATION OF DIRECTIONS FROM MEMBERS.
Any Member's rights contained in this Plan or in the
Trust Agreements to direct any action may be exercised
only by directions communicated to the Advisory
Committee. The Advisory Committee must communicate
those directions to the Trustee or other appropriate
persons. Any Member's directions communicated by the
Advisory Committee are deemed to be true and accurate,
and each recipient of directions shall be entitled to
rely conclusively upon the directions.
<PAGE>
ARTICLE IX
AMENDMENT, TERMINATION AND MERGER
9.01. AMENDMENT.
(a) The Board of Directors retains the right at any
time;
(1) to amend this Plan (or any component hereof)
and any Trust Agreement to qualify or retain
qualification of this Plan and the Trust
under the applicable provisions of the Code
or under any other laws;
(2) to amend this Plan (or any component hereof)
and any Trust Agreement in any other manner;
and
(3) to amend this Plan (or any component hereof)
and liquidate any Trust Fund by transferring
all assets to a new trust qualified under the
Code.
(b) No amendment to the Plan or any Trust Agreement
and no transfer of liabilities or assets of any
Trust Fund shall permit any part of the Trust Fund
to be used for or diverted to purposes other that
for the exclusive benefit of Members and
Beneficiaries and for defraying reasonable
expenses of administering the Plan. An amendment
may not cause any reduction in benefits accrued by
any Member or cause or permit any portion of the
Trust Fund to revert to or become the property of
<PAGE>
an Employer. An amendment that affects the
rights, duties or responsibilities of any
Fiduciary may not be made without that Fiduciary's
written consent. Except as permitted by Treasury
regulation, no Plan amendment or transaction
having the effect of a Plan amendment (such as a
merger, plan transfer or similar transaction)
shall be effective to the extent it eliminates or
reduces any "Section 411(d)(6) protected benefit"
or adds or modifies conditions relating to
"Section 411(d)(6) protected benefits" the result
of which is a further restriction on such benefit
unless such protected benefits are preserved with
respect to benefits accrued as of the later of the
adoption date or effective date of the amendment.
"Section 411(d)(6) protected benefits" are
benefits described in Code Section 411(d)(6)(A),
early retirement benefits and retirement-type
subsidies, and optional forms of benefit. An
amendment is effective on the date indicated in
any written instrument that is identified as an
amendment to the SRP or the EEP, that is approved
or authorized by the Board of Directors of Cone
Mills Corporation and that is signed by an officer
of the Corporation.
<PAGE>
(c) As allowed by law, a transfer of labilities or
Trust Fund assets or any amendment to the Plan or
a Trust Agreement may authorize or permit part of
the Trust Fund to be used for or diverted to
payment of taxes owed or to payment of reasonable
administrative expenses. To the extent allowed by
Code Section 401(a), Trust Fund assets may be used
for or diverted to purposes that benefit Employees
other than Members or their Beneficiaries or
estates.
9.02. TERMINATION.
(a) The Board of Directors has the right at any time
to terminate this Plan (or any Component hereof)
and any Trust Agreement. Notice of a termination
must be given to the Members, the Advisory
Committee, the affected Trustees or Co-Trustees
and all necessary authorities. If any authority's
approval is necessary, termination is effective
according to that approval; otherwise, the date of
the notice or a later date contained in the
notice is the termination date for purposes of
this Plan.
(b) If the Plan (or any component hereof) terminates,
all Accounts are then nonforfeitable (100%
vested). If the Plan (or any component hereof)
partially terminates (determined in a manner
consistent with legal authorities), all Accounts
<PAGE>
of affected Members are fully nonforfeitable and
may then be treated by the Advisory Committee as
if the Plan had terminated.
(c) On the Plan's (or any component hereof)
termination, the Advisory Committee must direct
the Trustee to allocate the assets of the affected
Trust Fund among the Members and Beneficiaries
according to the rules contained in Article IV.
Members have no recourse toward satisfaction of
their SRP Accounts other than from the SRP Trust
Fund and no recourse toward satisfaction of their
EEP Accounts other than from the EEP Trust Fund.
(d) After providing for payment of any expenses
properly chargeable against the affected Trust
Fund and compliance with all other requirements of
law, the Advisory Committee may direct the
Trustees and Co-Trustees to distribute assets
remaining in the Trust Fund. Distributions
according to this Section 9.02. are not subject to
the regular distribution provisions of this Plan,
but must be in the manner the Advisory Committee
determines consistent with statutory requirements
and purposes of the Plan. Except as specifically
provided by law, the Advisory Committee's
determination is conclusive.
(e) Each Trustee and Co-Trustee must transfer or
<PAGE>
deliver property to Members according to the
Advisory Committee's directions. A Trustee or Co-
Trustee will have not further right, title or
interest in property distributed. After all
distributions, each Trustee and Co-Trustee is
discharged from all obligations under the Trust
Agreements. Except by statute, no Member or
Beneficiary has any further right or claim.
9.03. DISCONTINUANCE OF CONTRIBUTIONS.
(a) Each Employer has the right at any time to reduce
or discontinue its contributions to this Plan (or
any component hereof). If there is a complete
discontinuance of contributions from all
Employers, all Accounts become fully non-
forfeitable.
(b) A discontinuance of Employer contributions is not
a termination of the Plan unless Cone gives the
notice described in Plan Section 9.02(a).
9.04. PLAN MERGER OR ASSET TRANSFER.
(a) The merger or consolidation of this Plan with, or
the transfer of assets or liabilities of this Plan
(or any component hereof) to another employee
benefit plan or the transfer of assets or
liabilities of another plan to this Plan is
allowed provided each Member's benefit entitlement
immediately after the merger, consolidation, or
transfer, is (when computed as if the surviving or
<PAGE>
receiving plan had immediately terminated) equal
to or greater than the benefit to which the Member
would have been entitled if this Plan had
terminated immediately before the merger,
consolidation, or transfer.
(b) Subject to subsection (a), on written direction
from Cone, the Advisory Committee and any Trustee
or Co-Trustee so directed must take all necessary
steps to transfer assets held in any Trust Fund,
in whole or in part, to another qualified plan.
9.05. CONTINUATION OF THE PLAN.
If an Employer is merged or consolidated with any other
business or is succeeded by a corporation or any other
legal entity that acquires substantially all of the
Employer's assets, the surviving or purchasing
corporation or legal entity, subject to approval of the
Board of Directors, may elect to continue this Plan (or
any component hereof) as to that Employer's Members but
shall not be required to do so.
<PAGE>
ARTICLE X
MULTIPLE COMPANIES INCLUDED
10.01. PLAN SPONSOR AND OTHER EMPLOYERS.
(a) This Plan's sponsor is Cone Mills Corporation, or
its successor.
(b) This Plan is designed to allow the sponsor's
Affiliates to participate. Employers are Cone
Mills Corporation and any Affiliate that was
participating in this Plan before the effective
Date of this amendment and restatement and
Affiliates that are permitted to adopt this Plan
in accordance with Section 10.02.
10.02. METHOD OF PARTICIPATION.
With approval of the Board of Directors, any other
business that is an Affiliate of Cone may take
appropriate action through its board and become a party
to the Plan (or any component hereof) as an Employer.
To become an Employer, a business must adopt this Plan
(or any component hereof) as a Qualified Plan for its
employees. A Business that becomes an Employer must
promptly deliver to the Trustee or Co-Trustees
designated by Cone a copy of the resolutions or other
documents evidencing its adoption of the Plan (or any
component hereof) and also a written instrument showing
Cone's Board's approval of the adopting entity's status
as a party to the Plan and an Employer.
<PAGE>
10.03 WITHDRAWAL BY EMPLOYER.
(a) An employer may withdraw from the Plan (or any
component hereof) at any time by giving the
Advisory Committee and the Board of Directors six
months advance notice in writing of its intention
to withdraw unless a shorter notice is agreed to
by the Board of Directors.
(b) Upon receipt of an Employer's notice of
withdrawal, the Advisory Committee must certify to
the appropriate Trustees or Co-Trustees the
withdrawing Employer's equitable share in the
Trust Fund. The Advisory Committee may rely
conclusively on the determination made by counsel
and advisors then employed on behalf of the Plan.
The Trustees or Co-Trustees must then set aside
from the Trust Fund such securities and other
property as each deems, in its sole discretion, to
be equal in value to that amount directed by the
Advisory Committee. If the Plan (or any component
hereof) is to be terminated with respect to the
Employer, then the amount set aside must be dealt
with according to the provisions of Plan Article
IX. If the Plan (or any component hereof) is not
to be terminated with respect to the Employer, the
Trustee or Co-Trustees must either transfer the
assets set aside to another trust governed by an
<PAGE>
agreement between a Trustee or Co-Trustees and the
withdrawing Employer or to a successor trustee,
according to the Advisory Committee's directions.
(c) The segregation of the Trust Fund Assets upon an
Employer's withdrawal, or the execution of a new
agreement and declaration of trust pursuant to any
of the provisions of this section, must not
operate to permit any part of the Trust Fund's
principal or income to be used for or diverted to
purposes other than for the benefit of Members and
Beneficiaries or for the payment of reasonable
expenses of administering the Plan.
10.04. TAX YEAR.
Although the Employers may have different tax years,
the Plan Year which is the calendar year, is the tax
year for this Plan and any Trust Fund.
<PAGE>
ARTICLE XI
GENERAL
11.01. PLAN CREATES NO SEPARATE RIGHTS.
The establishment and existence of the Plan, Trust
Agreements and Trust Fund does not give a person any
legal or equitable right against:
(a) an Employer;
(b) any officer, director, Employee or other agent of
an Employer;
(c) any Trustee or any Co-Trustee;
(d) the Advisory Committee or any member of the
Advisory Committee.
The Plan and Trust Agreements create no employment
rights and do not modify the terms of an Employee's or
a Member's employment. The Plan and Trust Agreements
are not contracts between an Employer and any Employee,
and the Plan is not an inducement for anyone's
employment.
11.02. DELEGATION OF AUTHORITY.
Cone's acts may be accomplished by any person with
authorization from the Board of Directors. Any other
Employer's acts may be accomplished by an person with
authorization from that Employer's board.
11.03. LIMITATION OF LIABILITY.
(a) A Fiduciary is not subject to suit or liability in
connection with this Plan or the Trust Agreement
or their operation, except according to this
Section 11.03.
<PAGE>
(b) Each member of the Advisory Committee, each
Trustee and Co-Trustee and any person employed by
an Employer is liable only for that person's own
acts or omissions.
(c) Each member of the Advisory Committee, each
Trustee and Co-Trustee, or any person employed by
an Employer is not liable for the acts or
omissions of another without knowing participation
in the acts or omissions, except by action to
conceal an action or omission of another while
knowing the act or omission is a breach, or by a
failure to properly perform duties that enables
the breach to occur, or with knowledge of the
breach, failure to make reasonable efforts to
remedy the breach.
(d) One Trustee or Co-Trustee must use reasonable care
to prevent another from committing a breach; but
all Trustees and Co-Trustees need not jointly
manage or control the assets, because specific
duties have been allocated among them in this Plan
or the Trust Agreements. A Trustee or Co-Trustee
is not liable for actions or omissions when
following the specific directions of the Advisory
Committee or a duly authorized and appointed
Investment Manager unless such directions are
improper on their face. If an Investment Manager
has been properly appointed, subject to subsection
<PAGE>
(c), a Trustee or Co-Trustee is not liable for the
acts of the Investment Manager and does not have
any investment responsibility for assets under the
management of the Investment Manager.
(e) A Fiduciary is not liable for the actions of
another to whom responsibility has been allocated
or delegated according to this Plan and the Trust
Agreements, unless as the allocating or delegating
Fiduciary it was imprudent in making the
allocation or delegation or in continuing the
allocation or delegation.
(f) Each Employee releases all members of the
Investment Committee and the Advisory Committee,
each Trustee and Co-Trustee, each Employer, all
officers and agents of each Employer, and all
agents of Fiduciaries from any and all liability
or obligation, to the extent release is consistent
with the provisions of this Section.
11.04. LEGAL ACTION.
Except as explicitly permitted by statute, in any
action or proceeding involving the Plan, a Trust
Agreement, a Trust Fund, any property held as part of a
Trust Fund, or the administration of the Plan or Trust
Fund, the Advisory Committee, the appropriate Trustee
or Co-Trustees and Cone are the only necessary parties.
No Employees or former Employees or their Beneficiaries
<PAGE>
or any person having or claiming to have an interest in
any Trust Fund, or under the Plan is entitled to notice
of process. Any final judgment that is not appealed or
appealable that may be entered in an action or
proceeding is binding and conclusive on the parties to
this Plan and all persons having or claiming to have
any interest in any Trust Fund or under the Plan.
11.05. BENEFITS SUPPORTED ONLY BY TRUST.
Except as otherwise provided by statute, a person
having any claim under the Plan must look solely to the
assets of the Trust Fund for satisfaction.
11.06. DISCRIMINATION.
The Advisory Committee must administer the Plan in a
uniform and consistent manner for all Members and may
not permit discrimination in favor of Highly
Compensated Employees.
11.07. MODEL AMENDMENT IV.
The following sections of Model Amendment IV (IRS
Notice 87-2) are hereby incorporated in the
Supplemental Retirement Plan of Cone Mills Corporation
for the Plan Years beginning January 1, 1987 and
January 1, 1988: I, II, III, IV, V, VI, VIII, IX, X, XI
AND XII.
11.08. ENTIRE PLAN.
This document incorporates in their entirety
the Plan, the SRP and the EEP and supersedes
and replaces all prior plan documents. It
<PAGE>
may not be amended, modified or supplemented
except by a written instrument that is
identified as an amendment to the Plan, the
SRP or the EEP, that is approved or
authorized by the Board of Directors of Cone
Mills Corporation and that is signed by an
officer of the Corporation.
<PAGE>
SIGNATURE PAGE
As evidence of the adoption of the Plan, as amended and restated,
for itself and by all Affiliated Companies, Cone Mills
Corporation has caused this document to be signed by its duly
authorized officer effective January 1, 1994.
Cone Mills Corporation
By:
Title: Vice President
<PAGE>
EXHIBIT 4.9
<PAGE>
SUPPLEMENTAL RETIREMENT PROGRAM
OF
CONE MILLS CORPORATION
<PAGE>
TABLE OF CONTENTS
Page
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . .1-4
ARTICLE I DEFINITIONS
Section
1.01. Account. . . . . . . . . . . . . . . . . . . . . . . .5
1.02. Actual Deferral Percentage . . . . . . . . . . . . . .5
1.03. Advisory Committee . . . . . . . . . . . . . . . . . .5
1.04. Affiliate. . . . . . . . . . . . . . . . . . . . . . .5
1.05. Alternate Payee. . . . . . . . . . . . . . . . . . . .5
1.06. Annual Additions . . . . . . . . . . . . . . . . . . .5
1.07. Approved Leave . . . . . . . . . . . . . . . . . . .5-6
1.08. Beneficiary or Beneficiaries . . . . . . . . . . . . .6
1.09. Board of Directors . . . . . . . . . . . . . . . . . .7
1.10. Break in Service . . . . . . . . . . . . . . . . . . .7
1.11. CODA Account . . . . . . . . . . . . . . . . . . . . .7
1.12. CODA Contributions . . . . . . . . . . . . . . . . . .7
1.13. Code . . . . . . . . . . . . . . . . . . . . . . . . .7
1.14. Compensation . . . . . . . . . . . . . . . . . . . .7-9
1.15. Computation Period . . . . . . . . . . . . . . . . . .9
1.16. Cone . . . . . . . . . . . . . . . . . . . . . . . . .9
1.17. Cone Contributions . . . . . . . . . . . . . . . . . .9
1.18. Cone Contributions Account . . . . . . . . . . . . . .9
1.19. Continuous Service . . . . . . . . . . . . . . . . 9-10
1.20. EEP. . . . . . . . . . . . . . . . . . . . . . . . . 11
1.21. EEP CODA Contributions . . . . . . . . . . . . . . . 11
1.22. EEP CODA Contributions Account . . . . . . . . . . . 11
1.23. EEP Cone Contributions . . . . . . . . . . . . . . . 11
1.24. EEP Cone Contributions Account . . . . . . . . . . . 11
1.25. EEP Voluntary Contributions Account. . . . . . . . . 11
1.26. Effective Date . . . . . . . . . . . . . . . . . . . 11
1.27. Eligible Employee. . . . . . . . . . . . . . . . . . 11
1.28. Employee . . . . . . . . . . . . . . . . . . . . .12-13
1.29. Employer . . . . . . . . . . . . . . . . . . . . . . 13
1.30. Employment Commencement Date . . . . . . . . . . . . 13
1.31. ERISA. . . . . . . . . . . . . . . . . . . . . . . . 13
1.32. Forfeiture . . . . . . . . . . . . . . . . . . . . . 13
1.33. Hour of Service. . . . . . . . . . . . . . . . . .13-17
1.34. Investment Committee . . . . . . . . . . . . . . . . 17
1.35. Investment Earnings. . . . . . . . . . . . . . . . . 17
1.36. Investment Fund. . . . . . . . . . . . . . . . . . . 17
1.37. Investment Manager . . . . . . . . . . . . . . . . . 18
1.38. Member . . . . . . . . . . . . . . . . . . . . . . . 18
1.39. Period of Severance. . . . . . . . . . . . . . . . . 18
1.40. Plan . . . . . . . . . . . . . . . . . . . . . . . . 18
i
<PAGE>
Section Page
1.41. Plan Year. . . . . . . . . . . . . . . . . . . . . . 18
1.42. Prior Plan . . . . . . . . . . . . . . . . . . . . . 18
1.43. Rule of Parity Years . . . . . . . . . . . . . . . . 18
1.44. Salary . . . . . . . . . . . . . . . . . . . . . . . 19
1.45. Salary-Reduction Election. . . . . . . . . . . . . . 19
1.46. Severance from Service Date. . . . . . . . . . . .19-20
1.47. Spouse . . . . . . . . . . . . . . . . . . . . . . . 20
1.48. SRP. . . . . . . . . . . . . . . . . . . . . . . . . 20
1.49. SRP CODA Contributions . . . . . . . . . . . . . . . 20
1.50. SRP CODA Contributions Account . . . . . . . . . . . 20
1.51. SRP Cone Contributions . . . . . . . . . . . . . . . 21
1.52. SRP Cone Contributions Account . . . . . . . . . . . 21
1.53. SRP Voluntary Contributions Account. . . . . . . . . 21
1.54. Trust and Trust Fund . . . . . . . . . . . . . . . . 21
1.55. Trust Agreement. . . . . . . . . . . . . . . . . . . 21
1.56. Trustee. . . . . . . . . . . . . . . . . . . . . . . 21
1.57. Valuation Date . . . . . . . . . . . . . . . . . . . 21
1.58. Voluntary Contribution . . . . . . . . . . . . . . . 22
1.59. Year of Service. . . . . . . . . . . . . . . . . .22-25
ARTICLE II PARTICIPATION
Section
2.01. Member . . . . . . . . . . . . . . . . . . . . . . . 26
2.02. Conditions of Participation. . . . . . . . . . . .26-27
2.03. Employment and Eligibility Status Changes. . . . . . 27
2.04. Participation Upon Reemployment. . . . . . . . . .27-28
ARTICLE III CONTRIBUTIONS
Section
3.01. CODA Contributions . . . . . . . . . . . . . . . .29-32
3.02. Cone Contributions . . . . . . . . . . . . . . . .32-34
3.03. Cash and Noncash Contributions . . . . . . . . . .34-35
3.04. Deferral Percentage Test - CODA Contributions. . .35-41
3.05. Contributions Percentage Test - Employee After-Tax42-45
Contributions and Cone Contributions
3.06. Distribution Restrictions. . . . . . . . . . . . . . 45
ARTICLE IV ACCOUNTS AND ALLOCATIONS
Section
4.01. Individual Accounts. . . . . . . . . . . . . . . . . 46
4.02. CODA Contributions Account . . . . . . . . . . . . . 46
ii
<PAGE>
Section Page
ARTICLE IV ACCOUNTS AND ALLOCATIONS continued:
Section
4.03. Cone Contributions Account . . . . . . . . . . . .47-50
4.04. Voluntary Contributions Account. . . . . . . . . . . 51
4.05. Allocation of Investment Earnings. . . . . . . . .51-53
4.06. Maximum Annual Additions . . . . . . . . . . . . .53-65
4.07. Adjustments for Excessive Annual Additions . . . .65-67
4.08. Determination of Top Heavy Status. . . . . . . . .67-77
4.09. Top Heavy Requirements . . . . . . . . . . . . . .77-80
ARTICLE V VESTING
Section
5.01. Vested Accounts. . . . . . . . . . . . . . . . . .81-82
5.02. Forfeitures. . . . . . . . . . . . . . . . . . . . . 82
ARTICLE VI DISTRIBUTION OF BENEFITS
Section
6.01. Claim Procedure. . . . . . . . . . . . . . . . . . . 83
6.02. Review of Claims . . . . . . . . . . . . . . . . .83-84
6.03. Distribution Definitions . . . . . . . . . . . . .84-85
6.04. Methods of Payment . . . . . . . . . . . . . . . .85-90
6.05. Commencement of Benefits . . . . . . . . . . . . .90-93
6.06. Special Distribution Provisions. . . . . . . . . .93-94
6.07. Death Benefits . . . . . . . . . . . . . . . . . .94-97
6.08. Qualified Domestic Relations Order . . . . . . . .97-98
6.09. Withholding of Benefits. . . . . . . . . . . . . . . 99
6.10. Hardship Withdrawal. . . . . . . . . . . . . . . 99-102
6.11. Valuation of Account Balances. . . . . . . . . . . .103
6.12. Withholding of Taxes . . . . . . . . . . . . . . . .103
6.13. Eligible Rollover Distributions. . . . . . . . .103-106
ARTICLE VII DISTRIBUTION OF BENEFITS
Section
7.01. Investment Funds . . . . . . . . . . . . . . . .107-108
7.02. Directing Investment of Individual Accounts. . .108-113
7.03. Segregated Account . . . . . . . . . . . . . . . . .113
iii
<PAGE>
Section Page
ARTICLE VIII TRUST FUND AND ADMINISTRATION OF THE PLAN
Section
8.01. Named Fiduciaries, Allocation of Responsibility.114-116
8.02. Duties and Responsibilities. . . . . . . . . . . . .116
8.03. Trust Fund . . . . . . . . . . . . . . . . . . . . .117
8.04. Enforceable Rights . . . . . . . . . . . . . . . . .117
8.05. Impossibility of Diversion . . . . . . . . . . . . .118
8.06. Advisory Committee and Other Committees. . . . . . .118
8.07. Officers, Quorums, Expenses. . . . . . . . . . .118-119
8.08. Duties of Investment Manger. . . . . . . . . . .119-120
8.09. Information to Investment Manager. . . . . . . .120-121
8.10. Notice to Trustee. . . . . . . . . . . . . . . . . .121
8.11. Duties of the Advisory Committee . . . . . . . .121-122
8.12. Notice of Payments Due . . . . . . . . . . . . . . .122
8.13. Records and Reports. . . . . . . . . . . . . . . . .122
8.14. Exoneration of Advisory Committee. . . . . . . . . .123
8.15. Errors and Omissions . . . . . . . . . . . . . . . .124
8.16. Fees and Expenses. . . . . . . . . . . . . . . . . .125
8.17. Voting and Tendering of Shares . . . . . . . . .125-126
8.18. Certification of Directions from Members . . . . . .126
ARTICLE IX AMENDMENT, TERMINATION AND MERGER
Section
9.01. Amendment. . . . . . . . . . . . . . . . . . . .127-129
9.02. Termination. . . . . . . . . . . . . . . . . . .129-131
9.03. Discontinuance of Contributions. . . . . . . . . . .131
9.04. Plan Merger or Asset Transfer. . . . . . . . . .131-132
9.05. Continuation of the Plan . . . . . . . . . . . . . .132
ARTICLE X MULTIPLE COMPANIES INCLUDED
Section
10.01. Plan Sponsor and Other Employers . . . . . . . . . .133
10.02. Method of Participation. . . . . . . . . . . . . . .133
10.03. Withdrawal by Employer . . . . . . . . . . . . .134-135
10.04. Tax Year . . . . . . . . . . . . . . . . . . . . . .135
iv
<PAGE>
Section Page
ARTICLE XI GENERAL
Section
11.01. Plan Creates No Separate Rights. . . . . . . . . . .136
11.02. Delegation of Authority. . . . . . . . . . . . . . .136
11.03. Limitation of Liability. . . . . . . . . 137-138136-138
11.04. Legal Action . . . . . . . . . . . . . . . . . .138-139
11.05. Benefits Supported Only by Trust . . . . . . . . . .139
11.06. Discrimination . . . . . . . . . . . . . . . . . . .139
11.07. Model Amendment IV . . . . . . . . . . . . . . . . .139
11.08. Entire Plan. . . . . . . . . . . . . . . . . . . . .140
SIGNATURE PAGE . . . . . . . . . . . . . . . . . . . . . . . .141
v
<PAGE>
INTRODUCTION
Cone Mills Corporation ("Cone") initially adopted the
Supplemental Retirement Plan of Cone Mills Corporation (the
"Supplemental Plan") effective January 1, 1947. Its purposes
were to supplement pension benefits for salaried employees of
Cone and its affiliates and to promote strong employee interest
in successful business operations.
The Supplemental Plan was amended a number of times since
inception; several of the more significant changes are described
below. Amendments effective January 1, 1983, provided for
salary-reduction contributions pursuant to a qualified cash or
deferred arrangement under Section 401 (k) of the Internal
Revenue Code, of 2% to 6% of members' salaries. Limited in-
service withdrawal rights and investment choices and a shortened
vesting period of five years instead of 15 years were also
instituted. Amendments effective January 1, 1984, to permit
after-tax voluntary contributions of 2% to 6% of salary and to
grant authority to the Advisory Committee to reduce or suspend
salary-reduction elections were adopted.
On November 11, 1986, the Board of Directors of Cone authorized
amendments which increased member cash or deferred elections to
2% to 10% of salary and discontinued after-tax contributions
effective January 1, 1987. Other changes became effective as a
result of the Retirement Equity Act of 1984 and the Tax Reform
Act of 1986. On December 8, 1987, the Board of Directors of
<PAGE>
Cone again approved amendments to the Plan which established
matching Cone contributions equal to 25% of member salary-
reduction contributions not in excess of 6% of salaries,
permitted additional matching Cone contributions at the
discretion of the Board of Directors and added semi-annual member
investment and contributions elections.
Effective May 1, 1989, the Supplemental Retirement Plan of Cone
Mills Corporation was amended, restated, and renamed, and will
operate as and be known as the Supplemental Retirement Program of
Cone Mills Corporation. As amended and restated, the Program
consists of two separate plans: the Cone Mills Corporation
Supplemental Retirement Plan (SRP), which is a continuation of
the prior plan, and the Cone Mills Corporation Employee Equity
Plan (EEP), which is a new stock bonus plan that invests
primarily in Common Stock of Cone Mills Corporation. Members
were afforded the opportunity of transferring from the SRP to the
EEP all or any portion of their SRP account balances as of
June 30, 1989. Effective July 1, 1989 members may make salary-
reduction contributions of 2% to 10% of salary and direct that
the contribution be made to the SRP or EEP or divided between the
two plans. Cone's matching contributions remained at 25% of
salary reduction contributions not in excess of 6% of salary to
the SRP and were set at 50% of such members' contributions to the
EEP. If a member contributes more than 6% to both Plans, the 6%
limitation will be divided between the SRP and EEP in the same
proportion as the member elects to divide his salary reduction
<PAGE>
contribution. In this document, the Supplemental Retirement
Program may be referred to as the Plan.
Effective January 1, 1993 hourly employees were added to the
class of employees eligible to participate in the Plan. In
addition, amendments to the Plan require quarterly valuation and
reporting of member account balances, give members the right to
change their contribution percentages and SRP investment fund
selection quarterly, added a third investment choice in the SRP
and subject to certain restrictions, provide limited rights to
transfer funds from the EEP to the SRP.
This Plan document has been amended and restated to incorporate
all amendments that became effective on or before
September 1, 1993. Cone intends to continue the SRP as a profit-
sharing plan (assigned plan number 003) by incorporating all
amendments described above and any other changes required by
applicable law or regulation effective or to become effective at
the time of adoption of this amended and restated SRP. Cone
intends to maintain the EEP as a stock bonus plan (assigned plan
number 016) by incorporating all provisions required by
applicable law effective or to become effective at the time of
adoption of this amended and restated EEP. Accordingly, the
effective date of this amended and restated Plan document is
September 1, 1993 except with respect to those provisions that
were required to be effective earlier pursuant to the Tax Reform
Act of 1986 and except as otherwise provided herein.
<PAGE>
The Supplemental Plan is funded through the Trust Agreement for
the Supplemental Retirement Plan of Cone Mills Corporation. The
EEP is funded through the Cone Mills Corporation Employee Equity
Plan Trust.
Any word in this Plan with an initial capital not expected by
ordinary capitalization rules is a defined term. Definitions not
found in the Plan are in the Internal Revenue Code or the
Employee Retirement Income Security Act, both laws as amended to
the present time. The masculine gender where appearing in the
Plan includes the feminine gender unless the context clearly
indicates otherwise. Article and Section headings are included
for convenience of reference and do not affect the Plan terms in
any way.
<PAGE>
ARTICLE I
DEFINITIONS
1.01. Account means a Member's interest under the Plan
according to Plan provisions. A Member may have
several named accounts in this Plan. When Account is
used without modification, it means the sum of all the
Member's Accounts in this Plan.
See also: CODA Account, Cone Contributions Account and
Voluntary Account.
1.02. Actual Deferral Percentage or ADP is defined in Plan
Section 3.04(b).
1.03. Advisory Committee means the committee appointed by
Cone Mills Corporation which is responsible for general
administration of the Plan.
1.04. Affiliate means a member of the same controlled group
of corporations as defined in Code Section 1563(a) as
Cone Mills Corporation.
1.05. Alternate Payee means a Member'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 a Member.
1.06. Annual Additions is defined in Plan Section 4.06.
1.07. Approved Leave means an individual's nonworking period
granted by an Employer for reasons relating to:
(a) accident, sickness or disability:
<PAGE>
1.07. Approved Leave continued:
(b) job-connected education or training;
(c) government service, including jury duty, whether
elective or by appointment; or
(d) terminal leave, with or without pay.
Approved Leaves shall be granted pursuant to policies
that are uniformly applied to all individuals, with no
discrimination in favor of Highly Compensated Employees
as defined in Code Section 414(q). Approved Leave also
means an individual's nonworking period during which he
is absent from work due to compulsory service in the
Armed Forces of the United Services and such period
thereafter as his job rights are protected by law.
1.08. Beneficiary or Beneficiaries means one or more individuals
or other entities so designated by a Member according to
Plan Section 6.07, or if there is no effective
designation, then as specified in that Section. Despite
the preceding, to the extent provided in a Qualified
Domestic Relations Order as defined in Code Section
414(p), or to the extent provided in any domestic
relations order entered before January 1, 1985, under
which payments have begun, Beneficiary means the Spouse,
former Spouse, child or other dependent of a Member who is
recognized by that order as having a right to receive all
or a portion of any benefits payable under the Plan on
behalf of such Member.
<PAGE>
1.09. Board of Directors means the Board of Directors of Cone
Mills Corporation.
1.10. Break in Service is defined for Full-Time Employees in
subsection (a) and is defined for Part-Time Employees
in subsection (b).
(a) A Full-Time Employee has a one-year Break in
Service for each twelve-consecutive-month Period
of Severance.
(b) A Part-Time Employee has a one-year Break in
Service during each Plan Year in which he receives
credit for fewer than 501 Hours of Service after
crediting Hours of Service according to Internal
Revenue Code Sections 410(a)(3)(E) and
411(a)(6)(E) regarding maternity and paternity
absences.
1.11. CODA Account means the sum of a Member's EEP CODA
Account and his SRP CODA Account.
1.12. CODA Contributions means the Employers' contributions
described in Plan Section 3.01 caused by Salary-
Reduction Elections and includes both EEP CODA
Contributions and SRP CODA Contributions.
1.13. Code means the Internal Revenue Code as amended by the
Tax Reform Act of 1986, as amended from time to time.
1.14. Compensation means base Salary, wages, overtime
earnings, vacation pay, holiday pay, service awards,
severance pay, incentive pay, bonuses, commissions,
supervisors' supplement and other similar compensation,
but does not
<PAGE>
1.14. Compensation continued:
include pension or profit sharing benefits or other
benefits and contributions paid by any Employer (other
than contributions caused by the Member's salary-
reduction elections that are not includable in his
gross income by reason of Code Sections 125 or
402(e)(3)), stock option payments, moving or regular
expense allowances, moving expense reimbursements,
retainers, fees under contract, mortgage interest
differential payments, imputed income resulting from
personal use of company cars or from group term life
insurance coverage, or any other similar compensation
not related to actual earnings as an employee.
Notwithstanding the foregoing, the annual Compensation
of each member taken into account under the Plan for
any Plan Year shall not exceed $200,000 ($150,000,
effective for Plan Years beginning January 1, 1994) as
adjusted for increases in cost-of-living in accordance
with Code Sections 401(a)(17) and 415(d). In
determining the compensation of a Member for purposes
of this limitation, the rules of Code Section 414(q)(6)
shall apply, except in applying such rules, the term
"family" shall mean only the Spouse of the Member and
any lineal descendants of the member who have not
attained age 19 before the close of the Plan Year. If
as a result of the application of such rules the
adjusted $200,000 ($150,000, effective for Plan Years
beginning
<PAGE>
1.14. Compensation continued:
January 1, 1994) limitation is exceeded, the limitation
shall be prorated among the affected individuals in
proportion to each such individual's Compensation
determined under this Section 1.14 prior to application
of the limitation. The Compensation of an Employee
described in the last sentence of Section 1.28 of the
Plan shall be determined in accordance with the special
rules set forth in Code Section 406(b)(2).
1.15. Computation Period means a consecutive twelve-month
period beginning with an Employee's Employment
Commencement Date and succeeding anniversaries of such
date and in addition, for Part-Time Employees, a Plan
Year.
1.16. Cone means Cone Mills Corporation, a North Carolina
corporation, the Plan sponsor.
1.17. Cone Contributions means the Employer Contributions
described in Plan Section 3.02 and includes both EEP
Cone Contributions and SRP Cone Contributions.
1.18. Cone Contributions Account means the sum of a Member's
EEP Cone Contributions Account and his SRP Cone
Contributions Account.
1.19. Continuous Service means an Employee's period of
employment with an Employer or an Affiliate beginning
with his Employment Commencement Date and continuing
until his Severance from Service Date. If an Employee
is
<PAGE>
1.19. Continuous Service continued:
reemployed or returns to work after a Severance from
Service and his Continuous Service completed before his
Severance from Service is not required to be recognized
under this Plan, his period of employment with an
Employer or an Affiliate is Continuous Service
beginning on the date on which he again is credited
with an Hour of Service for the performance of duties
and continuing until his later Severance from Service
Date. Continuous Service includes all employment even
though as a non-Member. For purposes of eligibility to
participate in the Plan and vesting, the Continuous
Service of an Employee who quits, retires or is
discharged includes his Period of Severance (up to a
maximum of 12 months) if he again performs an Hour of
Service with an Employer or an Affiliate before the
first anniversary of the date he quit, retired or was
discharged, and the Continuous Service of an Employee
who is absent for any reason other than quit,
retirement or discharge and who has a Severance from
Service before the first anniversary of such absence
includes the period of time between the Severance from
Service Date and the first anniversary of the absence
if he again performs an Hour of Service with an
Employer or an Affiliate before the first anniversary
of the absence.
<PAGE>
1.20. EEP means the Cone Mills Corporation Employee Equity
Plan, the stock bonus plan incorporated in this Plan
document.
1.21. EEP CODA Contributions means CODA Contributions made to
the EEP pursuant to Salary-Reduction Elections.
1.22. EEP CODA Contributions Account means a Member's Account
to which his EEP CODA Contributions are allocated.
1.23. EEP Cone Contributions means Cone Contributions made to
the EEP pursuant to Plan Section 3.02.
1.24. EEP Cone Contributions Account means a Member's Account
to which EEP Cone Contributions are allocated.
1.25. EEP Voluntary Contributions Account means a Member's
Account to which amounts transferred from his SRP
Voluntary Contributions Account pursuant to Member
elections in accordance with Plan provisions in effect
on May 1, 1989 are allocated.
1.26. Effective Date means with respect to this amended and
restated Plan, September 1, 1993, except with respect
to those provisions that have an earlier effective date
pursuant to the Tax Reform Act of 1986, or as otherwise
provided. The Trust for each Plan has an effective
date contained in the first Trust Agreement executed
for that plan.
1.27. Eligible Employee is defined in Plan Section 2.02.
<PAGE>
1.28. Employee is an individual who renders personal services
for an Employer or an Affiliate, in an employer-
employee relationship, as defined for Federal Insurance
Contribution Act purposes and Federal Employment Tax
purposes, including Code Section 3401(c). A Full-Time
Employee is an individual who, according to a policy
uniformly applied in similar situations, is scheduled
to work the standard number of hours for his job
classification. A Part-Time Employee is one who,
according to a policy uniformly applied in similar
situations, is scheduled to work less than the standard
number of hours for full-time job classifications.
Employee shall included Leased Employees within the
meaning of Code Sections 404(n)(2) and 414(o)(2) unless
such Leased Employees are covered by a plan described
in Code Section 414(n)(5) and such Leased Employees do
not constitute more than 20% of the recipient's
nonhighly compensated work force. For purposes of the
Plan, a citizen or resident of the United States who is
an employee of a foreign entity in which Cone directly
or through other entities has not less than a ten
percent (10%) interest in the voting stock thereof (or,
in the case of an entity other than a corporation, in
the profits thereof) shall be treated as an Employee of
Cone if Cone has entered into an agreement under Code
Section
3121(l) with respect to such foreign entity and if no
<PAGE>
1.28. Employee continued:
contributions under a funded plan of deferred
compensation are provided by any person other than Cone
with respect to the remuneration paid to such
individual by the foreign entity.
1.29. Employer means an entity described in Plan Section
10.01.
1.30. Employment Commencement Date means the first day for
which an Employee is credited with an Hour of Service.
The Employment Commencement Date for any Employee who
has Rule of Parity Years is the first day after those
Rule of Parity Years for which that Employee is
credited with an Hour of Service for the performance of
duties.
1.31. ERISA means the Employee Retirement Income Security Act
of 1974, as amended from time to time.
1.32. Forfeiture refers to any part of a Member's Account
under this Plan to which he is not entitled to receive
by reason of the vesting rules of Plan Article V.
1.33. Hour of Service
(a) An Hour of Service is each hour for which an
Employee 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
Employee is paid or is entitled to payment by an
Employer or an Affiliate in a period during which
no duties are performed (regardless of whether the
<PAGE>
1.33. Hour of Service continued:
relationship has terminated) because of vacation,
holiday, illness, incapacity, layoff or Approved
Leave, but:
(1) no more than 501 Hours of Service are
credited under this subsection (b) to an
individual for any single continuous period
during which he performs no duties (whether
or not the period occurs in a single
Computation Period);
(2) an hour for which an individual is directly
or indirectly paid, or is entitled to
payment, because of a period during which no
duties are performed, is not credited to him
if that payment is made or is due under a
plan maintained solely for the purpose of
complying with applicable worker's
compensation, unemployment compensation or
disability insurance laws; and
(3) Hours of Service are not credited 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
<PAGE>
1.33. Hour of Service continued:
due from that entity directly or indirectly
through a trust fund or insurer to which that
entity contributes or pays premiums, and
regardless of whether contributions made or due to
the trust fund or insurer or other funding vehicle
are for the benefit of particular individuals or
are on behalf of a group of individuals.
(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 must not be
credited both under subsection (a) or (b) and also
under this subsection (c). Thus, for example, if
an individual receives a back-pay award following
a determination that he was paid at an unlawful
rate for Hours of Service previously credited, he
is not entitled to additional credit for the same
Hours of Service. 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 the subsection. For
example, not more than 501 Hours of Service are
required to be credited for payments of back pay,
to the extent that the back pay is agreed to or
awarded for a period of time during which an
<PAGE>
1.33. Hour of Service continued:
individual did not or would not have performed
duties.
(d) For determining Hours of Service for reasons other
than the performance of duties, the special rule
in 29 C.F.R. 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 the units of time, by dividing the
payment in question by the individual's most
recent hourly rate of pay.
(e) When crediting Hours of Service to Computation
Periods, the special rule in 29 C.F.R. 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 of duties.
(f) The determination of Hours of Service must be made
from records of hours worked and hours for which
payment is made or due.
(g) For purposes of determining Hours of Service
credited according to the maternity and paternity
absence provisions of Code Section 410(a)(5)(E)
and Code Section 411(a)(6)(E), those provisions
are
<PAGE>
1.33. Hour of Service continued:
first effective for Plan Years beginning after
1984.
1.34. Investment Committee means the Committee appointed by
Cone that, prior to August 20, 1992, had authority to
manage, acquire or dispose of the assets of the Plan in
accordance with and subject to Plan Section 8.08 (as in
effect prior to August 20, 1992) or to appoint one or
more Investment Managers for such purpose. The
Investment Committee was discontinued effective
August 20, 1992.
1.35. Investment Earnings means the net gain or loss of an
Investment Fund from interest and dividends received or
accrued, realized and unrealized gains and losses on
securities and any other investment transactions, less
expenses paid or chargeable to the Investment Fund for
a Plan Year or such interim period within a Plan Year
for which the assets of the Investment Fund are being
valued. Investment Earnings shall be determined on the
basis of generally accepted accounting principles and
assets of an Investment Fund as of any Valuation Date
shall be valued on the basis of their current fair
market value.
1.36. Investment Fund means a fund established for the
investment of Trust Fund assets pursuant to Article
VII.
<PAGE>
1.37. Investment Manager means an individual, firm or other
entity appointed by the Board of Directors and assigned
duties as described in Plan Section 8.08.
1.38. Member is defined in Plan Section 2.01.
1.39. Period of Severance means the period of time beginning
on an Employee's Severance from Service Date and ending
on the date on which he is next credited with an Hour
of Service for the performance of duties.
1.40. Plan means the Supplemental Retirement Program of Cone
Mills Corporation as described in this document. The
Program consists of the EEP, a stock bonus plan (plan
number 016), and the SRP, a profit sharing plan (plan
number 003).
1.41. Plan Year means a twelve (12) month period beginning on
January 1 and ending on December 31 and shall be the
"limitation year" for purposes of Code Section 415.
1.42. Prior Plan means the Supplemental Retirement Program of
Cone Mills Corporation as in effect on January 1, 1991.
1.43. Rule of Parity Years means Years of Service which are
disregarded for eligibility, vesting or other service
credit under the Plan. Rule of Parity Years only apply
to an Employee: (1) who has not joined either the EEP
or the SRP, (2) who has at least five consecutive one-
year Breaks in Service, and (3) whose total consecutive
one-year Breaks in Service exceed prior Years of
Service.
<PAGE>
1.44. Salary means compensation which is fixed in amount and
stipulated to be regularly paid by one or more
Employers for a definite period, which shall be a week
or more in duration as differentiated from wages,
commissions, bonuses or the guaranty of earnings for
wage earners over any stated period.
1.45. Salary-Reduction Election means the election described
in Plan Section 3.01, regardless of whether the
election is made with respect to base Salary, wages, or
other Compensation.
1.46. Severance from Service Date means the earliest of:
(a) the date an Employee quits, retires, is discharged
or dies; or
(b) the first anniversary of the date from which an
Employee remains absent from work (with or without
pay) for any other reason such as layoff,
disability, or Approved Leave; except that, for an
Employee who is absent from work by reason of a
maternity or paternity absence described in Code
Section 410(a)(5)(i)(E) or Code Section
411(a)(6)(i)(E) and who continues to be absent
from work beyond the first anniversary of the
first day of such maternity or paternity absence,
his Severance from Service Date is the second
anniversary of the first day of such absence and
the period between the first day and second
<PAGE>
1.46. Severance from Service Date continued:
anniversaries is neither a period of Continuous
Service nor a Period of Severance; and except
that, for an Employee who is absent from work by
reason of compulsory military service, his
Severance from Service Date is the 91st day
following his discharge from active duty.
An Employee's Severance from Service Date may be
postponed by the Advisory Committee under established
policy uniformly applied in similar situations. For
purposes of this Plan, an Employee has a Severance from
Service on his Severance from Service Date.
1.47. Spouse means the individual legally married to a
Member. Surviving Spouse means the individual legally
married to a Member on the date of such Member's death.
An individual is not a Spouse or a Surviving Spouse
after the marriage to the Member is legally ended for
reasons other than death of the Member.
1.48. SRP means the Cone Mills Corporation Supplemental
Retirement Plan, the profit sharing plan incorporated
in this Plan document.
1.49. SRP CODA Contributions means CODA Contributions made to
the SRP pursuant to Salary-Reduction Elections.
1.50. SRP CODA Contributions Account means a Member's Account
to which his SRP CODA Contributions (including all CODA
Contributions made prior to May 1, 1989) are allocated.
<PAGE>
1.51. SRP Cone Contributions means Cone Contributions made to
the SRP pursuant to Plan Section 3.02.
1.52. SRP Cone Contributions Account means a Member's Account
to which his SRP Cone Contributions (including all Cone
Contributions made prior to May 1, 1989) are allocated.
1.53. SRP Voluntary Contributions Account means a Member's
Account to which his Voluntary Contributions are
allocated.
1.54. Trust and Trust Fund refers to a Trust Fund established
for this Plan and the Trust Agreement(s) executed under
this Plan.
1.55. Trust Agreement means any agreement including
amendments executed by a Trustee or Co-Trustee with
Cone to be used in connection with this Plan.
1.56. Trustee means one or more individuals or entities or
their successors so designated in the Trust Agreement.
A Co-Trustee is one of several Trustees so designated
under a Trust Agreement. Unless the context clearly
indicates otherwise, the term Trustee also means
Co-Trustees.
1.57. Valuation Date for this Plan means March 31, June 30,
September 30 and December 31 of each Plan Year and any
other date on which a valuation is made in connection
with the payment of benefits.
<PAGE>
1.58. Voluntary Contribution means any nondeductible Member
contribution that is not made pursuant to a Salary
Reduction Election.
1.59. Year of Service is defined in (a) for a Part-Time
Employee and in (b) for a Full-Time Employee, but a
Year of Service does not include: (1) service with an
Employer before any termination of employment that
occurred before January 1, 1976; and (2) Rule of Parity
Years.
(a) for a Part-Time Employee, a Plan Year following a
Part-Time Employee's Employment Commencement Date
during which he is credited with at least 1,000
Hours of Service. A Part-Time Employee will be
credited with one Year of Service for his first
full Plan Year if he is credited with at least
1,000 Hours of Service during his initial
Computation Period, regardless of whether he is
credited with at least 1,000 Hours of Service
during such first full Plan Year, provided
however, a Year of Service shall not be given for
both the initial Computation Period and the first
full Plan Year of employment.
(b) for a Full-Time Employee, twelve months of
Continuous Service (whether or not consecutive).
Months of Continuous Service are aggregated yield
Years of Service.
<PAGE>
1.59. Year of Service continued:
If a Part-Time Employee becomes a Full-Time Employee
during his initial Computation Period and is credited
with at least 1,000 Hours of Service in such
Computation Period as of the date his change of status
occurred, he is granted a Year of Service and his
Continuous Service shall begin on the first day of the
Computation Period after which the change to Full-Time
status occurred. If he is not credited with at least
1,000 Hours of Service as of the date the change in
status occurred, then he is credited with service as if
he had been a Full-Time Employee during the entire
Computation period.
After completing his initial Computation Period, a
Part-Time Employee who becomes a Full-Time Employee and
who had been credited with at least 1,000 Hours of
Service for the Plan Year during which the change
occurs, retains his Years of Service for pre-change
Plan Years, is credited with a Year of Service for the
Plan Year in which the change occurs, and is credited
with Continuous Service beginning on the first day of
the Plan Year following the date on which the change
occurs. If a Part-Time Employee becomes a Full-Time
Employee, after completing one Computation Period, and
had not been credited with at least 1000 Hours of
Service for the Plan Year during which the change
occurs, his Continuous
<PAGE>
1.59. Year of Service continued:
Service is credited from the beginning of the Plan Year
in which the change occurs.
If a Full-Time Employee becomes a Part-Time Employee,
he shall receive credit for the number of full years of
Continuous Service completed as of the date the change
occurred and will be deemed to become a Part-Time
Employee on the first day of the Plan Year in which the
date of change occurs. For the Plan Year in which the
change occurs, he shall receive credit, on the basis of
190 Hours of Service per month or fraction thereof, for
the period from the end of his last full year of
Continuous Service to the date of his change in status.
A Full-Time Employee who quits, retires, is discharged
or is otherwise absent from work and who returns as a
Part-Time Employee within 12 months is treated as if he
had changed from a Full-Time Employee to a Part-Time
Employee on the date of his reemployment.
A Full-Time Employee who quits, retires, is discharged
or is otherwise absent from work and who returns after
the first anniversary of the date on which he quit,
retired, was discharged or otherwise absent from work
as a Part-Time Employee shall have an initial
Computation Period
<PAGE>
1.59. Year of Service continued:
begin on the date of return.
A Part-Time Employee who quits, retires, is discharged
or is otherwise absent from work and who returns as a
Full-Time Employee before the end of the Plan Year in
which such event occurred is treated as if he had been
a Part-Time Employee for the entire Plan Year and is
credited with 190 Hours of Service for each month in
which he is a Full-Time Employee; his Continuous
Service as a Full-Time Employee begins on the first day
of the next Plan Year.
<PAGE>
ARTICLE II
PARTICIPATION
2.01. MEMBER
A Member is an Employee or former Employee who has
begun participation in this Plan according to this
Article II. An individual whose Account Balance is
greater than zero continues to be a Member for purposes
of provisions relating to allocation of earnings and
losses to his Account and to distributions from his
Account, but is a Member for purposes of allocations of
Cone Contributions only if he was an Eligible Employee
at any time during the Plan Year and CODA Contributions
pursuant to Salary-Reduction Elections in effect during
such Plan Year were made on his behalf and not
withdrawn.
2.02. CONDITIONS OF PARTICIPATION
(a) An Employee shall become an Eligible Employee on
the January 1 or July 1 coinciding with or next
following his attainment of age twenty-one (21)
and completion of one (1) Year of Service.
(b) An Eligible Employee shall become a Member of the
SRP by electing an SRP CODA Contribution and shall
become a Member of the EEP by electing an EEP CODA
Contribution.
(c) Employees who are Leased Employees within the
meaning of Code Sections 414(n)(2) and 414(o)(2)
cannot be Eligible Employees.
<PAGE>
2.02. CONDITIONS OF PARTICIPATION continued:
(d) Employees who contribute to the Defined
Contribution Pension Plan of the Machine Printers'
and Engravers' Association of the United States
cannot be Eligible Employees.
2.03. EMPLOYMENT AND ELIGIBILITY STATUS CHANGES
(a) If a Member does not have a Severance from Service
Date but becomes an Employee of an Affiliate that
does not participate in the Plan, or ceases to
make CODA Contributions, he shall become a
suspended Member at the end of the pay period the
change in status occurs.
(b) If an Employee has attained age twenty-one (21)
and has at least one (1) Year of Service and
becomes an Eligible Employee due to transfer from
an Affiliate not participating in the Plan to an
Employer, he may participate in the Plan on the
January 1 or July 1 coinciding with or next
following such transfer. If he is not an Eligible
Employee at the time of such transfer, he shall
become an Eligible Employee according to Plan
Section 2.02.
2.04. PARTICIPATION UPON REEMPLOYMENT
(a) If a Member or Eligible Employee has a Severance
from Service Date and is reemployed, such Member
shall become an Eligible Employee when he first
performs an Hour of Service, unless all of his
<PAGE>
2.04. PARTICIPATION UPON REEMPLOYMENT continued:
Prior Years of Service are disregarded as Rule of
Parity Years.
(b) A Member or Eligible Employee who has a Severance
from Service Date and whose prior Years of Service
are all disregarded as Rule of Parity Years is
treated as a new Employee for all purposes under
the Plan and participates according to Plan
Section 2.02.
(c) An Employee who is not an Eligible Employee or
Member when he has a Severance from Service Date
shall be treated as a new Employee upon
reemployment and shall participate according to
Plan Section 2.02.
<PAGE>
ARTICLE III
CONTRIBUTIONS
3.01. CODA CONTRIBUTIONS
(a) The Employer's CODA Contribution for a Plan Year
is the total of all reductions in Members'
Compensation for the Plan Year by way of Salary-
Reduction Elections. Each Eligible Employee may
elect to have his Employer make CODA Contributions
on his behalf for a Plan Year in an amount,
expressed as a whole percentage, of not less than
2% or more than 10% of his Compensation, provided,
however, that no Member shall be permitted to have
"Excess Elective Deferrals", which shall mean CODA
Contributions made under this Plan, or any other
qualified plan maintained by an Employer, during
any taxable year, in excess of the dollar
limitation contained in Section 402(g) of the Code
in effect at the beginning of such taxable year.
All CODA Contributions shall be credited to the
Member's EEP CODA Contributions Account or to his
SRP CODA Contributions Account, as directed by the
Member. A Member may divide his CODA
Contributions between the SRP and the EEP provided
that at least 2% of his Compensation is
contributed to each plan.
(b) CODA Contributions elections shall be made on a
form provided by the Advisory Committee. Such
<PAGE>
3.01. CODA CONTRIBUTIONS continued:
forms shall authorize the Employer to remit the
aggregate amount of CODA Contributions designated
to be made from Compensation payable to the
Employee by the Employer to the EEP or to the SRP
or to divide such CODA Contributions between the
EEP and SRP. The Employer shall remit CODA
Contributions as soon as practicable, but in no
event later than ninety (90) days following the
end of the pay period for which such contributions
were made.
(c) Members and Eligible Employees will be allowed to
make or change CODA Contributions as of January 1,
April 1, July 1 and October 1 of each Plan Year.
Employees who are or become Eligible Employees
during the Plan Year may become Members of the
Plan by executing the appropriate Salary-Reduction
Election forms authorizing CODA Contributions to
become effective on the January 1 or July 1 next
following the date the election forms are
delivered to the Advisory Committee.
(d) Any Member may elect to cease CODA Contributions
to the Plan by delivering written notice to the
Advisory Committee, such election to be effective
as soon as possible after receipt. Should such
Member desire to rejoin the Plan, he may do so by
<PAGE>
3.01. CODA CONTRIBUTIONS continued:
submitting a new Salary-Reduction Election to the
Advisory Committee provided, however, that such
reinstatement will not become effective until the
July 1 or January 1 next following the effective
date on which his earlier CODA Contributions
terminated.
(e) As provided in Section 3.04, the Advisory
Committee may suspend or revoke any Salary-
Reduction Election of any member or cause refunds
of CODA Contributions previously made in the Plan
Year by a Member if it is determined that such
suspension, revocation or refund is necessary to
comply with the limitations and discrimination
tests contained in Section 401(k) of the Internal
Revenue Code.
(f) A Member may assign to this Plan any Excess
Elective Deferrals made during a taxable year of
the Member by notifying the Advisory Committee on
or before March 15 of the following year of the
amount of the excess CODA Contributions to be
assigned to the Plan. A Member is deemed to
notify the Advisory Committee of any Excess
Elective Deferrals that result solely from CODA
Contributions made to this Plan and any other
plans of an Employer. Notwithstanding any other
provisions of the Plan, excess CODA Contributions,
<PAGE>
3.01. CODA CONTRIBUTIONS continued:
plus any income and minus any loss allocable
thereto, shall be distributed no later than
April 15 to any Member to whose Account excess
CODA Contributions were assigned for the preceding
year and who claims excess CODA Contributions for
such taxable year.
3.02. CONE CONTRIBUTIONS
(a) The Employer shall contribute to the EEP for each
Plan Year an amount equal to 50% of the EEP CODA
Contributions made on behalf of Members for such
Plan Year. The Employer shall contribute to the
SRP for each Plan Year an amount equal to 25% of
the SRP CODA Contributions made on behalf of
Members for such Plan Year; however, CODA
Contributions made on behalf of any Member in
excess of 6% of his Compensation shall not be
taken into account in determining the Cone
Contribution. If the total CODA Contributions
made on behalf of any Member exceed 6% of his
Compensation, then the 6% of Compensation
limitation will be divided between the EEP and SRP
in the same proportion as the Member elects to
divide the CODA Contributions made on his behalf.
(b) Additional Cone Contributions may be made to the
EEP, the SRP or both, with respect to a Plan Year
<PAGE>
3.02. CONE CONTRIBUTIONS continued:
or with respect to any three-month period ending
March 31, June 30, September 30 or December 31, in
such amount as the Board of Directors in its sole
discretion may determine.
(c) Current or accumulated earnings and profits of the
Employer are not required in order for Cone
Contributions to be made. In no event,
however,shall Cone Contributions for any Plan Year
exceed the amount allowed as a deduction for its
fiscal year ended with or nearest the Plan Year
end for which such Cone Contributions are made
under applicable provisions of the Code.
(d) All Cone Contributions shall be paid not later
than the time prescribed in the Code for filing
the federal income tax return of the Employer
including extensions which have been granted for
the filing of such return. The Trustee is not
required to collect Cone Contributions or payments
required by an Employer and is responsible only
for assets received as Trustee.
(e) All contributions to the Trust Fund are
conditioned on their being deductible under
applicable provisions of the Code. If any
deduction for any contribution is not allowed in
whole or in part, then that disallowed portion
must be returned to
<PAGE>
3.02. CONE CONTRIBUTIONS continued:
the contributor, but repayment must be made no
later than one year after the disallowance. To
the extent such disallowance represents CODA
Contributions made pursuant to Salary-Reduction
Elections of Members, such contribution shall be
returned to the appropriate Members. For purposes
of this Section 3.02, the disallowance may be made
by the opinion of any court whose decision has
become final or by any disallowance asserted by
the Internal Revenue Service to which Cone agrees.
(f) If any excess 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. To the extent
such mistake-of-fact contribution represents CODA
Contributions made pursuant to Salary-Reduction
Elections of Members, such contributions shall be
returned to the appropriate Members. Earnings of
the Trust Fund attributable to the excess
contribution may not be returned but any losses
attributable thereto must reduce the amount
returned.
3.03. CASH AND NONCASH CONTRIBUTIONS
(a) Cone Contributions and CODA Contributions to the
SRP Trust Fund shall be in cash.
<PAGE>
3.03. CASH AND NONCASH CONTRIBUTIONS continued:
(b) CODA Contributions to the EEP Trust Fund shall be
in cash.
(c) Cone Contributions to the EEP Trust Fund may be in
the form of either cash or Qualifying Employer
Securities as defined in Section 407(d)(5) of
ERISA. All noncash property contributed to the
Trustee must be valued at its fair market value on
the actual date of acceptance of the property by
the Trustee.
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
(a) CODA Contributions under this Plan are intended to
qualify as cash or deferred arrangements according
to Section 401(k) of the Code. For purposes of
measuring compliance with Section 401(k), EEP CODA
Contributions and SRP CODA Contributions shall be
aggregated, the deferral percentage tests as
described in this Section 3.04 shall be made for
each Plan Year and compliance with such tests will
be secured as provided in this Section 3.04 and in
accordance with applicable provisions of the Code.
(b) Definitions for purposes of deferral percentage
tests are:
(1) Actual Deferral Percentage (ADP) means the
percentage determined by dividing the sum of
CODA Contributions made on behalf of a Member
<PAGE>
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
continued:
which are allocated to his Account for the
Plan Year or portion thereof by his
Compensation for the Plan Year or portion
thereof. The ADP of an Eligible Employee who
does not elect to have CODA Contributions
made on his behalf is zero.
(2) Average ADP means the arithmetic average of
the ADP of all Members and Eligible Employees
as a group.
(3) For any Plan Year, compensation may be given
any meaning which satisfies Code Section
414(s).
(4) Highly Compensated Employee includes highly
compensated active Employees and highly
compensated former Employees.
A highly compensated active Employee includes
any Employee who performs services for the
Employer during the determination year and
who, during the look-back year: (i) received
compensation from the Employer in excess of
$75,000 (as adjusted pursuant to Section
415(d) of the Code); (ii) received
compensation from the Employer in excess of
$50,000 (as adjusted pursuant in Section
415(d) of the Code) and was a member of the
<PAGE>
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
continued:
top-paid group for such year; or (iii) was an
officer of the Employer and received
Compensation during such year that is greater
than 150 percent of the dollar limitation in
effect under Section 415(b)(1)(A) of the
Code. The term highly compensated active
Employee also includes: (i) any Employee who
is both described in the preceding sentence
if the term "determination year" is
substituted for the term "look-back year" and
is one of the 100 Employees who received the
most Compensation from the Employer during
the determination year; and (ii) Employees
who are 5 percent owners at any time during
the look-back year or determination year.
If no officer has satisfied the Compensation
requirement of (iii) above during either a
determination year or look-back year, the
highest paid officer for such year shall be
treated as a Highly Compensated Employee.
For this purpose, the determination year
shall be the Plan Year. The look-back year
shall be the twelve-month period immediately
preceding the determination year.
<PAGE>
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
continued:
A highly compensated former Employee includes
any Employee who has a Severance from Service
(or was deemed to have a Severance from
Service) prior to the determination year,
performs no services for the Employer during
the determination year, and was a highly
compensated active Employee for either his
severance year or any determination year
ending on or after the Employee's 55th
birthday.
If an Employee is, during a determination
year or look-back year, a family member of
either a 5 percent owner who is an active or
former Employee or of a Highly Compensated
Employee who is one of the 10 most Highly
Compensated Employees ranked on the basis of
compensation paid by the Employer during such
year, then the combined ADP for the family
group of which such Employee is a member
(which is treated as one Highly Compensated
Employee) must be determined by combining the
compensation and CODA Contributions of all
the eligible family members, and the combined
ACP for the family group must be determined
by combining the
<PAGE>
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
continued:
compensation and Cone Contributions of all
the eligible family members. For purposes of
the Section, family member includes the
Spouse, lineal ascendants and descendants of
the Employee or former Employee and the
Spouses of such lineal ascendants and
descendants.
The determination of who is a Highly
Compensated Employee, including the
determinations of the number and identity of
Employees in the top-paid group, the top 100
Employees, the number of Employees treated as
officers and the compensation that is
considered, will be made in accordance with
Code Section 414(q) and the regulations
thereunder.
(5) Non-Highly Compensated Employee means an
Employee who is neither a Highly Compensated
Employee nor a family member of a Highly
Compensated Employee as defined in Plan
Section 3.04(b)(4).
(c) The average ADP for any Plan Year cannot exceed
the allowance set forth in the following table:
<PAGE>
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
continued:
(A) (B)
If Average Actual Deferral The Average Actual Deferral
Percentage for Eligible Non- Percentage for Eligible Highly
Highly Compensated Employees is: Compensated Employees can be:
2% or less.........................2 times Column A
2% to 8%...........................Column A plus 2
percentage points
Over 8%............................1.25 times Column A
(d) Notwithstanding the foregoing table, to avoid
duplicate use of the limit for any Highly
Compensated Employee in violation of Code Section
401(m)(9), the actual contribution ratio for
Highly Compensated Employees shall be reduced
pursuant to Treasury Regulation 1.401(m)-2 and
Plan Section 3.05(f).
(e) In the case of a Highly Compensated Employee who
is a Member or Eligible Employee and who is
eligible to have CODA Contributions made on his
behalf to individual accounts under two or more
Employer plans described in Section 401(a) or
401(k) of the Code, all such contributions shall
be treated as if made to a single plan for
purposes of determining the ADP for any Plan Year.
(f) CODA Contributions made on behalf of any Member
who is a Highly Compensated Employee, that in the
aggregate for any Plan Year, exceed the maximum
amount that can be allocated based on the
application of the deferral percentage test for
<PAGE>
3.04. DEFERRAL PERCENTAGE TEST - CODA CONTRIBUTIONS
continued:
such Plan Year, shall be distributed, to the
extent practicable within two and one half months,
but in no event later than the last day of the
Plan Year next following the year in which such
excess CODA Contributions were made. Such
distributions shall include any income or be
reduced by any loss applicable to the excess CODA
Contributions and shall be made in cash to the
Members on whose behalf excess CODA Contributions
were made. If it appears during a Plan Year that
excess CODA Contributions will be made on behalf
of Highly Compensated Employees, the Advisory
Committee, upon appropriate notice, may reduce, or
suspend entirely current Salary Reduction
Elections in effect for Highly Compensated
Employees or refund a portion of CODA
Contributions previously made in the Plan Year to
the extent necessary to comply with the deferral
percentage tests. The amount of excess CODA
Contributions for a Member who is a Highly
Compensated Employee shall be determined in
accordance with Treasury Regulation 1.401(k)-
1(f)(2). No "gap period" income or loss will be
distributed.
<PAGE>
3.05. CONTRIBUTIONS PERCENTAGE TEST - EMPLOYEE AFTER-TAX
CONTRIBUTIONS AND CONE CONTRIBUTIONS
(a) Contributions by Members on an after-tax basis are
not permitted by this Plan. If such Member
contributions are allowed in the future, they
shall be taken into account for purposes of
applying the tests described in this Section 3.05.
For purposes of measuring compliance with Section
401(m) of the Code, EEP Cone Contributions and SRP
Cone Contributions shall be aggregated, the
contribution percentages tests as described in
this Section 3.05 shall be made for each Plan Year
and compliance with such tests will be secured as
provided in this Section 3.05 and in accordance
with applicable provisions of the Code.
(b) Definitions for purposes of contributions
percentage tests are:
(1) Actual Contributions Percentage (ACP) means
the percentage determined by dividing the sum
of Cone Contributions and Member
contributions, if any, allocated to his
Account for the Plan Year or portion thereof
by his Compensation for the Plan Year or
portion thereof. The ACP of an Eligible
Employee who does not receive Cone
Contributions or make Member contributions is
zero.
<PAGE>
3.05. CONTRIBUTIONS PERCENTAGE TEST - EMPLOYEE AFTER-TAX
CONTRIBUTIONS AND CONE CONTRIBUTIONS continued:
(2) Average ACP means the arithmetic average of
the ACP for all Members and Eligible
Employees as a group.
(3) Compensation has the meaning given such term
by Plan Section 3.04(b)(3).
(4) Highly Compensated Employee means an Employee
described in Plan Section 3.04(b)(4).
(5) Non-Highly Compensated Employee means an
Employee who is neither a Highly Compensated
Employee nor a family member of a Highly
Compensated Employee as defined in Plan
Section 3.05(b)(5).
(c) The average ACP for any Plan Year cannot exceed
the allowance set forth in the following table:
(A) (B)
If Average Actual Contributions The Average Actual Contributions
Percentage for Eligible Non- Percentage for Eligible Highly
Highly Compensated Employees is: Compensated Employees can be:
2% or less.........................2 times Column A
2% to 8%...........................Column A plus 2
percentage points
Over 8%............................1.25 times Column A
(d) Notwithstanding the foregoing table, to avoid
duplicate use of the limit for any Highly
Compensated Employee in violation of Code Section
401(m)(9), the actual contribution ratio for
Highly Compensated Employees shall be reduced
pursuant to Treasury Regulation 1.401(m)-2 and
Plan Section 3.05(f).
<PAGE>
3.05. CONTRIBUTIONS PERCENTAGE TEST - EMPLOYEE AFTER-TAX
CONTRIBUTIONS AND CONE CONTRIBUTIONS continued:
(e) In the case of a Highly Compensated Employee who
is a Member or Eligible Employee and who is
eligible to receive matching Employer
Contributions and to make Member contributions to
individual accounts under two or more Employer
plans described in Section 401(a) or 401(m) of the
Code, all such contributions shall be treated as
if made to a single plan for purposes of
determining the ACP for any Plan Year.
(f) Cone Contributions made on behalf of any Member
who is a Highly Compensated Employee and Member
contributions that in the aggregate for any Plan
Year exceed the maximum amount that can be
allocated based on the application of the
contributions percentage test for such Plan Year,
shall be distributed, to the extent practicable
within two and one-half months, but in no event
later than the last day of the Plan Year next
following the year in which such excess Cone
Contributions and Member contributions were made.
Such distributions shall include any income or be
reduced by any loss applicable to the excess Cone
Contributions and Member Contributions and shall
be made in cash to the Members on whose behalf
excess Cone Contributions and Member contributions
were
<PAGE>
3.05. CONTRIBUTIONS PERCENTAGE TEST - EMPLOYEE AFTER-TAX
CONTRIBUTIONS AND CONE CONTRIBUTIONS continued:
made. If it appears during a Plan Year that
excess Cone Contributions and member contributions
will be made on behalf of Highly Compensated
Employees, the Advisory Committee, upon
appropriate notice, may reduce or suspend entirely
current Member contribution elections in effect
for Highly Compensated Employees or refund a
portion of such contributions previously made in
the Plan Year to the extent necessary to comply
with the contributions percentage tests. The
amount of excess CODA Contributions for a Member
who is a Highly Compensated Employee shall be
determined in accordance with Treasury Regulation
1.401(m)-1(e)(2) and 1.401(m)-2. No "gap period"
income or loss will be distributed.
3.06. DISTRIBUTION RESTRICTIONS
Except as permitted by Plan Section 3.04(f) or 3.05(f),
no distribution from the Plan shall be made to a Member
or his or her Beneficiary or Beneficiaries, in
accordance with such Member's or Beneficiary or
Beneficiaries election, earlier than upon Severance
from Service, death, disability or the hardship of the
Member as described in Plan Section 6.10.
<PAGE>
ARTICLE IV
ACCOUNTS AND ALLOCATIONS
4.01. INDIVIDUAL ACCOUNTS.
The Advisory Committee shall maintain individual
accounts for each Member in which all amounts allocated
to such Member shall be credited and all distributions
and other withdrawals shall be charged in accordance
with applicable provisions of this Plan. Individual
accounts shall contain the following components or
subaccounts as applicable: CODA Contributions Account
consisting of the Member's EEP CODA Contributions
Account and his SRP CODA Contributions Account; Cone
Contributions Account consisting of the Member's EEP
Cone Contributions Account and his SRP Cone
Contributions Account; and Voluntary Contributions
Account consisting of the Member's EEP Voluntary
Contribution Account and his SRP Voluntary Contribution
Account. Each Member's individual account shall
reflect the Investment Funds in which his account
balances are invested pursuant to Plan Article VII.
4.02. CODA CONTRIBUTIONS ACCOUNT.
As of each Valuation Date,the Advisory Committee shall
credit the total value of the contributions made during
the period ending on such Valuation Date by each Member
pursuant to his Salary-Reduction Election to his CODA
Contributions Account.
<PAGE>
4.03. CONE CONTRIBUTIONS ACCOUNT.
(a) As of each Valuation Date, the Advisory Committee
shall compute each Member's share of Cone
Contributions determined for the period ending on
such Valuation Date under Plan Section 3.02 and
allocate such amount to his Cone Contributions
Account as provided herein. Cone Contributions
shall be allocated and credited to the Cone
Contributions Accounts of Members employed on each
Valuation Date and Members who retired, terminated
employment, suspended CODA Contributions or died
during the period ending on such Valuation Date
and who had made CODA Contributions pursuant to
Salary-Reduction Elections in effect during such
period.
(b) Each Member described in paragraph (a) above shall
receive an allocation of Cone Contributions made
pursuant to Plan Section 3.02(a) as follows:
(1) With respect to Cone Contributions made to
the SRP pursuant to Section 3.02(a), each
Member shall be credited with 25% of the
aggregate SRP CODA Contributions made on his
behalf for the applicable Plan Year and not
withdrawn, provided, however, that CODA
Contributions in excess of 6% of his
Compensation shall not be taken into account.
<PAGE>
4.03. CONE CONTRIBUTIONS ACCOUNT continued:
(2) With respect to Cone Contributions made to
the EEP pursuant to Section 3.02(a), each
Member shall be credited with 50% of the
aggregate EEP CODA Contributions made on his
behalf for the applicable Plan Year and not
withdrawn, provided, however, that CODA
Contributions in excess of 6% of his
Compensation shall not be taken into account.
If the total CODA Contributions made on behalf of
any Member exceed 6% of his Compensation then the
6% of Compensation limitation will be divided
between the SRP and the EEP in the same proportion
as the Member elects to have divided the CODA
Contributions made on his behalf.
(c) Each Member described in paragraph (a) above shall
receive an allocation of Cone Contributions made
pursuant to Plan Section 3.02(b) as follows:
(1) With respect to Cone Contributions made to
the SRP pursuant to Section 3.02(b), each
Member shall be credited with the same
proportion of the additional Cone
Contributions as the SRP CODA Contributions
made on his behalf for the applicable Plan
Year or other period and not withdrawn bears
to the total CODA Contributions made on
behalf of all Members
<PAGE>
4.03. CONE CONTRIBUTIONS ACCOUNT continued:
for such Plan Year or period and not
withdrawn; provided, however, that in its
resolutions authorizing any additional Cone
Contributions to the SRP pursuant to Section
3.02(b), the Board of Directors may direct
that SRP CODA Contributions in excess of a
specified percentage of Compensation shall be
disregarded, in which case each Member shall
be credited with the same proportion of the
additional Cone Contributions as the SRP CODA
Contributions made on his behalf not in
excess of the specified percentage of
Compensation bears to the total CODA
Contributions made on behalf of all members,
not in excess of the specified percentage of
each individual's Compensation.
(2) With respect to Cone Contributions made to
the EEP pursuant to Section 3.02(b), each
Member shall be credited with the same
proportion of the additional Cone
Contributions as the EEP CODA Contributions
made on his behalf for the applicable Plan
Year or other period and not withdrawn bears
to the total CODA Contributions made on
behalf of all Members for such Plan Year or
period and not
<PAGE>
4.03. CONE CONTRIBUTIONS ACCOUNT continued:
withdrawn; provided, however, that in its
resolutions authorizing any additional Cone
Contributions to the EEP pursuant to Section
3.02(b), the Board of Directors may direct
that EEP CODA Contributions in excess of a
specified percentage of Compensation shall be
disregarded, in which case each Member shall
be credited with the same proportion of the
additional Cone Contributions as the EEP CODA
Contributions made on his behalf not in
excess of the specified percentage of
Compensation bears to the total CODA
Contributions made on behalf of all members,
not in excess of the specified percentage of
each individual's Compensation.
If the total CODA Contributions made on behalf of
any Member for any applicable Plan Year or other
period exceed the percentage limitation specified
by the Board of Directors in its resolution
authorizing additional Cone Contributions pursuant
to Section 3.02(a), then the percentage of
Compensation Limitation will be divided between
the SRP and the EEP in the same proportion as the
Member elects to have divided the CODA
Contributions made on his behalf.
<PAGE>
4.04. VOLUNTARY CONTRIBUTIONS ACCOUNT.
Members who made Voluntary Contributions as previously
permitted under the Plan shall have a Voluntary
Contributions Account, which shall have as its opening
balance, the amount carried forward from the previous
Plan. Voluntary Member Contributions are not permitted
by this Plan; such Accounts will only share in
Investment Earnings as hereafter provided.
4.05. ALLOCATION OF INVESTMENT EARNINGS.
Investment Earnings as of each Valuation Date shall be
allocated to the individual Accounts of Members as
provided below:
(a) The Trustee shall determine the net Investment
Earnings as of each Valuation Date separately for
each Investment Fund in accordance with generally
accepted accounting principles. The determination
by the Trustee may be accepted as conclusive by
the Advisory Committee.
(b) Investment Earnings for each Investment Fund shall
be allocated as of each Valuation Date to the
individual Accounts of Members in the same
proportion that the dollar value investment of
each Member's individual Account in such
Investment Fund bears to the total dollar value
investment of all Member's individual Accounts in
such Investment Fund. The dollar value investment
eligible to
<PAGE>
4.05. ALLOCATION OF INVESTMENT EARNINGS continued:
share in the allocation of net Investment Earnings
shall be determined by deducting from the value of
each individual Account as of the preceding
Valuation Date the total amount of all single sum
payments or withdrawals and one-half (1/2) the
amount of all installment payments out of such
individual Account; provided however, that the
total amount of all installment payments shall be
deducted if the total amount in an individual
Account as of the preceding Valuation Date is to
be paid out prior to the next succeeding Valuation
Date. The amount eligible to share in the
allocation of net Investment Earnings shall be
increased by adding to the value of each Member's
individual accounts as of the preceding Valuation
Date, one-half of the amount of CODA Contributions
made to such accounts with respect to each Member,
but not withdrawn during the period after the
preceding Valuation Date.
(c) Notwithstanding the foregoing provisions of this
Section 4.05, unrealized gains and losses with
respect to Qualifying Employer Securities held in
the Company Stock Fund shall not be allocated, but
the value of Qualifying Employer Securities
allocated to a Member's EEP Accounts shall be
<PAGE>
4.05. ALLOCATION OF INVESTMENT EARNINGS continued:
determined as of each Valuation Date and reported
to the Member. Qualifying Employer Securities
traded on the New York Stock Exchange with be
valued at their closing price on the Exchange on
the Valuation Date or, if that date is not a
business day, on the immediately preceding
business day.
4.06. MAXIMUM ANNUAL ADDITIONS.
(a) Notwithstanding any other provision of this Plan,
the maximum "Annual Additions" credited to a
Member's Account for any "limitation year" shall
equal the lesser of: (1) $30,000 (or, if greater,
one-fourth of the dollar limitation in effect
under Code Section 415(b)(1)(A)) or (2) twenty-
five percent (25%) of the Member's "415
Compensation" for such "limitation year."
(b) For purposes of applying the limitations of Code
Section 415, "Annual Additions" means the sum
credited to a Member's individual Accounts in the
SRP and the EEP, taken together, for any
"limitation year" of: (1) Cone Contributions, (2)
CODA Contributions, (3) Voluntary Contributions,
(4) Forfeitures, (5) amounts allocated, after
March 31, 1984, to an individual medical account,
as defined in Code Section 415 (1)(2) which is
part of
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
a pension or annuity plan maintained by the
Employer and (6) amounts derived from
contributions paid or accrued after December 31,
1985, in taxable years ending after such date,
which are attributable to post-retirement medical
benefits allocated to the separate account of a
key employee (as defined in Code Section
419A(d)(3)) under a welfare benefit plan (as
defined in Code Section 419(e) maintained by the
Employer. Except, however, the "415 Compensation"
percentage limitation referred to in paragraph
(a)(2) above shall not apply to: (1) any
contribution for medical benefits (within the
meaning of Code Section 419A(f)(2)) after
separation from service which is otherwise treated
as an "Annual Addition," or (2) any amount
otherwise treated as an "Annual Addition" under
Code Section 415(1)(1).
(c) For purposes of applying the limitations of Code
Section 415, the transfer of funds from one
qualified plan to another is not an "Annual
Addition." In addition, the following are not
CODA Contributions or Voluntary Contributions for
the purposes of Plan Sections 4.06(b)(2) and (3):
(1) rollover contributions (as defined in Code
Sections 402(a)(5), 403(a)(4), 403(b)(8) and
408(d)(3)); (2)
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
repayments of loans made to a Member from the
Plan; (3) repayments of distributions received by
an Employee pursuant to Code Section 411(a)(7)(B)
(cash-outs); (4) repayments of distributions
received by an Employee pursuant to Code Section
411(a)(3)(D) (mandatory contributions); and (5)
Employee contributions to a simplified employee
pension excludable from gross income under Code
Section 408(k)(6).
(d) For purposes of applying the limitations of Code
Section 415, "415 Compensation" shall include the
Member's wages, salaries, fees for professional
service and other amounts for personal services
actually rendered in the course of employment with
an Employer maintaining the Plan(including, but
not limited to, commissions paid salesmen,
compensation for service on the basis of a
percentage of profits, commissions on insurance
premiums, tips and bonuses and in the case of a
Member who is an Employee within the meaning of
Code Section 401(c)(1) and the regulations
thereunder, the Member's earned income (as
described in Code Section 401(c)(2) and the
regulations thereunder)) paid during the
"limitation year".
"415 Compensation" shall exclude: (1)(A)
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
contributions made by the Employer to a plan of
deferred compensation to the extent that, before
the application of the Code Section 415
limitations to the Plan, the contributions are not
includable in the gross income of the Employee for
the taxable year in which contributed (including
contributions not includable in gross income under
Code Section 402(e)(3)), (B) contributions made by
the Employer to a plan of deferred compensation to
the extent that all or a portion of such
contributions are recharacterized as a voluntary
Employee contribution, (C) Employer contributions
made on behalf of an Employee to a simplified
employee pension plan described in Code Section
408(k) to the extent such contributions are
excludable from the Employee's gross income, (D)
any distributions from a plan of deferred
compensation regardless of whether such amounts
are includable in the gross income of the Employee
when distributed except any amounts received by an
Employee pursuant to an unfunded non-qualified
plan to the extent such amounts are includable in
the gross income of the Employee; (2) amounts
realized from the exercise of a non-qualified
stock option or when restricted stock (or
property) held by an Employee either
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
becomes freely transferable or is no longer
subject to a substantial risk of forfeiture; (3)
amounts realized from the sale, exchange or other
disposition of stock acquired under a qualified
stock option; and (4) other amounts which receive
special tax benefits, such as premiums for group
term life insurance (but only to the extent that
the premiums are not includable in the gross
income of the Employee), contributions not
includable in gross income under Code Section 125,
and contributions made by the Employer (whether or
not under a salary reduction agreement) towards
the purchase of any annuity contract described in
Code Section 403(b) (whether or not the
contributions are excludable from the gross income
of the Employee). "415 Compensation" shall be
limited to $200,000 ($150,000, effective for Plan
Year beginning January 1, 1994) (unless adjusted
in the same manner as permitted under Code Section
415(d).
(e) For purposes of applying the limitations of Code
Section 415, the "limitation year" shall be the
Plan Year.
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
(f) The dollar limitation under Code Section
415(b)(1)(A) stated in paragraph (a)(1) above
shall be adjusted annually as provided in Code
Section 415(d) pursuant to the Regulations. The
adjusted limitation is effective as of January 1st
of each calendar year and is applicable to
"limitation years" ending with or within that
calendar year.
(g) For the purpose of this Section, all qualified
defined benefit plans (whether terminated or not)
ever maintained by the Employer shall be treated
as one defined benefit plan, and all qualified
defined contribution plans (whether terminated or
not) ever maintained by the Employer shall be
treated as one defined contribution plan.
(h) For the purpose of this Section, if the Employer
is a member of a controlled group of corporations,
trades or businesses under common control (as
defined by Code Section 1563(a) or Code Section
414(b) and (c) as modified by Code Section 415(h)
or is a member of an affiliated service group (as
defined by Code Section 414(m)), all Employees of
such Employers shall be considered to be employed
by as single Employer.
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
(i) For the purpose of this Section, if this Plan is a
Code Section 413(c) plan, all Employers of a
Member who maintain this Plan will be considered
to be a single Employer.
(j) (1) If a Member participates in more than one
defined contribution plan maintained by the
Employer which have different Anniversary
Dates, the maximum "Annual Additions" under
this Plan shall equal the maximum "Annual
Additions" for the "limitation year" minus
any "Annual Additions" previously credited to
such Member's accounts during the "limitation
year."
(2) If a Member participates in both a defined
contribution plan subject to Code Section 412 and
a defined contribution plan not subject to Code
Section 412 maintained by the Employer which have
the same Anniversary Date, "Annual Additions" will
be credited to the Member's accounts under the
defined contribution plan subject to Code Section
412 prior to crediting "Annual Additions" to the
Member's accounts under the defined contribution
plan not subject to Code Section 412.
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
(3) If a Member participates in more than one defined
contribution plan not subject to Code Section 412
maintained by the Employer which have the same
Anniversary Date, the maximum "Annual Additions"
under this Plan shall equal the product of (A) the
maximum "Annual Additions" for the "limitation
year" minus any "Annual Additions" previously
credited under subparagraphs (1) or (2) above,
multiplied by (B) a fraction (i) the numerator of
which is the "Annual Additions" which would be
credited to such Member's accounts under this Plan
without regard to the limitations of Code Section
415 and (ii) the denominator of which is such
"Annual Additions" for all plans described in this
subparagraph.
(k) Subject to the exception in Section 4.06(p) below,
if an Employee is (or has been) a Member in one or
more defined benefit plans and one or more defined
contribution plans maintained by the Employer, the
sum of the defined benefit plan fraction and the
defined contribution plan fraction for any
"limitation year" may not exceed 1.0.
(l) (1) The defined benefit plan fraction for any
"limitation year" is a fraction (A) the
numerator of which is the "projected annual
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
benefit" of the Member under the Plan
(determined as of the close of the
"limitation year"), and (B) the denominator
of which is the greater of the product of
1.25 multiplied by the "protected current
accrued benefit" or the lesser of: (i) the
product of 1.25 multiplied by the maximum
dollar limitation provided under Code Section
415(b)(1)(A) for such "limitation year," or
(ii) the product of 1.4 multiplied by the
amount which may be taken into account under
Code Section 415(b)(1)(B) for such
"limitation year."
(2) For purposes of applying the limitation of
Code Section 415, the "projected annual
benefit" for any Member is the benefit,
payable annually, under the terms of the
Plan determined pursuant to Regulation 1.415-
7(b)(3).
(3) For purposes of applying the limitations of
Code Section 415, "protected current accrued
benefit" for any Member in a defined benefit
plan in existence on July 1, 1982, shall be
the accrued benefit, payable annually,
provided for under question T-3 of Internal
Revenue Service Notice 83-10.
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
(m) (1) The defined contribution plan fraction for
any "limitation year" is a fraction (A) the
numerator of which is the sum of the "Annual
Additions" to the Member's accounts as of the
close of the "limitation year" and (B) the
denominator of which is the sum of the lesser
of the following amounts determined for such
year and each prior year of service with the
Employer: (i) the product of 1.25 multiplied
by the dollar limitation in effect under Code
Section 415(c)(1)(A) for such "limitation
year" (determined without regard to Code
Section 415(c)(6)), or (ii) the product of
1.4 multiplied by the amount which may be
taken into account under Code Section
415(c)(1(B) for such "limitation year."
(2) Notwithstanding the foregoing, the numerator
of the defined contribution plan fraction
shall be adjusted pursuant to Regulation
1.415-7(d)(1) and questions T-6 and T-7 of
Internal Revenue Service Notice 83-10.
(3) For defined contribution plans in effect on
or before July 1, 1982, the Administrator may
elect, for any "limitation year" ending after
December 31, 1982, that the amount taken into
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
account in the denominator for every Member
for all "limitation years" ending before
January 1, 1983 shall be an amount equal to
the product of (A) the denominator for the
"limitation year" ending in 1982 determined
under the law in effect for the "limitation
year" ending in 1982 multiplied by (B) the
"transition fraction."
(4) For purposes of the preceding paragraph, the
term "transition fraction" shall mean a
fraction (A) the numerator of which is the
lesser of (I) $51,875 or (ii) 1.4 multiplied
by twenty-five percent (25%) of the Member's
"415 Compensation" for the "limitation year"
ending in 1981, and (B) the denominator of
which is the lesser of (i) $41,500 or (ii)
twenty-five percent (25%) of the Member's
"415 Compensation" for the "limitation year"
ending in 1981.
(5) Notwithstanding the foregoing, for any
"limitation year" in which the Plan is a Top
Heavy Plan, $41,500 shall be substituted for
$51,875 in determining the "transition
fraction."
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
(n) Notwithstanding the foregoing, for any "limitation
year" in which the Plan is a Top Heavy Plan, 1.0
shall be substituted for 1.25 in paragraph 1(1)
and m(1).
(o) If the sum of the defined benefit plan fraction
and the defined contribution plan fraction shall
exceed 1.0 in any "limitation year" for any Member
in this Plan for reasons other than described in
Section 4.06(p), the Advisory Committee shall then
adjust the numerator of the defined benefit plant
fraction so that the sum of both fractions shall
not exceed 1.0 in any "limitation year" for such
Member.
(p) If (1) the substitution of 1.00 for 1.25 and
$41,500 for $51,875 above or (2) the excess
benefit accruals or "Annual Additions" provided
for in Internal Revenue Service Notice 82-19 cause
the 1.0 limitation to be exceeded for any Member
in any "limitation year," such Member shall be
subject to the following restrictions for each
future "limitation year" until the 1.0 limitation
is satisfied: (A) the Member's accrued benefit
under the defined benefit plant shall not
increase, (B) no "Annual Additions" may be
credited to a Member's account and (C) no Employee
contributions (voluntary or mandatory) shall be
made under any
<PAGE>
4.06. MAXIMUM ANNUAL ADDITIONS continued:
defined benefit plan or any defined contribution
plan of the Employer.
(q) Notwithstanding anything contained in this Section
to the contrary, the limitations, adjustments and
other requirements prescribed in this Section
shall at all times comply with the provisions of
Code Section 415 and the Regulations thereunder,
the terms of which are specifically incorporated
herein by reference.
4.07. ADJUSTMENTS FOR EXCESSIVE ANNUAL ADDITIONS.
(a) If, as a result of a reasonable error in
estimating a Member's Compensation or other facts
and circumstances to which Regulation 1.415-
6(b)(6) shall be applicable, the "Annual
Additions" under this Plan would cause the maximum
"Annual Additions" to be exceeded for any Member,
the Advisory Committee shall (1) return any CODA
Contributions credited for the "limitation year"
to the extent that the return would reduce the
"excess amount", in the Member's accounts, (2)
hold any "excess amount" remaining after the
return of any CODA contributions in a "Section 415
suspense account", (3) use the "Section 415
suspense account" in the next "limitation year"
(and succeeding "limitation years" if necessary)
to
<PAGE>
4.07. ADJUSTMENTS FOR EXCESSIVE ANNUAL ADDITIONS continued:
reduce CODA Contributions for that Member if that
Member is covered by the Plan as of the end of the
"limitation year," or if the Member is not so
covered, allocate and reallocate the "Section 415
suspense account" in the next "limitation year"
(and succeeding "limitation years" if necessary)
to all Members in the Plan before any Cone or CODA
Contributions which would constitute "Annual
Additions" are made to the Plan for such
"limitation year", (4) reduce Cone Contributions
to the Plan for such "limitation year" by the
amount of the "Section 415 suspense account"
allocated and reallocated during such "limitation
year."
(b) For purposes of this Section, "excess amount" for
any Member for a "limitation year" shall mean the
excess, if any, of: (1) the "Annual Additions"
which would be credited to his account under the
terms of the Plan without regard to the
limitations of Code Section 415, over (2) the
maximum "Annual Additions" determined pursuant to
Section 4.06.
(c) For purposes of this Section, "Section 415
suspense account" shall mean an unallocated
account equal to the sum of "excess amounts" for
all Members in the Plan during the "limitation
year." The "Section 415 suspense account" shall
not share in any
<PAGE>
4.07. ADJUSTMENTS FOR EXCESSIVE ANNUAL ADDITIONS continued:
earnings or losses of the Trust Fund.
(d) The Plan may not distribute "excess amounts,"
other than CODA Contributions as provided by the
Code and regulations thereunder, to Members or
former Members.
4.08 DETERMINATION OF TOP HEAVY STATUS.
This Plan shall be a Top Heavy Plan for any Plan Year
in which, as of the Determination Date, (1) the Present
Value of Accrued Benefits of Key Employees and (2) the
sum of the Aggregate Accounts of Key Employees under
this Plan and all plans of an Aggregation Group, exceed
sixty percent (60%) of the Present Value of Accrued
Benefits and the Aggregate Accounts of all Key and Non-
Key Employees under this Plan and all plans of an
Aggregation Group.
This Plan shall be a Super Top Heavy Plan for any Plan
Year in which, as of the Determination Date, (1) the
Present Value of Accrued Benefits of Key Employees and
(2) the sum of the Aggregate Accounts of Key Employees
under this Plan and all plans of an Aggregation Group,
exceed ninety percent (90%) of the Present Value of
Accrued Benefits and the Aggregate Accounts of all Key
and Non-Key Employees under this Plan and all plans of
an Aggregation Group.
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
If any Member is a Non-Key Employee for any Plan Year,
but such Member was a Key Employee for any prior Plan
Year, such Member's Present Value of Accrued Benefits
and/or Aggregate Account balance shall not be taken
into account for purposes of determining whether this
Plan is a Top Heavy or Super Top Heavy Plan (or whether
any Aggregation Group which includes this Plan is a Top
Heavy Group). In addition, if a Member or Former
Member has not performed any services for any Employer
maintaining the Plan at any time during the five year
period ending on the Determination Date, any accrued
benefit for such Member or former Member shall not be
taken into account for the purposes of determining
whether this Plan is a Top Heavy or Super Top Heavy
Plan.
The following definitions apply in determining whether
the Plan is a Top Heavy Plan or a Super Top Heavy Plan:
(a) Aggregate Account: A Member's Aggregate Account
as of the Determination Date is the sum of:
(1) the Member's Account balance as of the most
recent Valuation Date occurring within a
twelve (12) month period ending on the
Determination Date;
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
(2) an adjustment for any contributions due as of
the Determination Date. Such adjustment
shall be the amount of any contributions
actually made after the most recent Valuation
Date but due on or before the Determination
Date, except for the first Plan Year when
such adjustment shall also reflect the amount
of any contributions made after the
Determination Date that are allocated as of a
date in that first Plan Year;
(3) any Plan distributions made within the Plan
Year that includes the Determination Date or
within the four (4) preceding Plan Years.
However, in the case of distributions made
after the most recent Valuation Date and
prior to the Determination Date, such
distributions are not included as
distributions for top heavy purposes to the
extent that such distributions are already
included in the Member's Aggregate Account
balance as of the Valuation Date.
Notwithstanding anything herein to the
contrary, all distributions, including
distributions made prior to January 1, 1984,
and distributions under a terminated plan
which if it had not been terminated would
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
have been required to be included in an
Aggregation Group, will be counted. Further,
distributions from the Plan (including the
cash value of life insurance policies) of a
Member's account balance because of death
shall be treated as a distribution for the
purposes of this paragraph.
(4) any Employee contributions, whether voluntary
or mandatory. However, amounts attributable
to tax deductible qualified voluntary
employee contributions shall not be
considered to be a part of the Member's
Aggregate Account balance.
(5) with respect to unrelated rollovers and plan-
to-plan transfers (ones which are both
initiated by the Employee and made from a
plan maintained by one employer to a plan
maintained by another employer), if this Plan
provides the rollovers or plan-to-plan
transfers, it shall always consider such
rollovers or plan-to-plan transfers as a
distribution for the purposes of this
Section.
(6) with respect to related rollovers and plan-
to-plan transfers (ones either not initiated
by the Employee or made to a plan maintained
by
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
the same employer), if this Plan provides the
rollover or plan-to-plan transfer, it shall
not be counted as a distribution for purposes
of this Section. If this Plan is the plan
accepting such rollover or plan-to-plan
transfer, it shall consider such rollover or
plan-to-plan transfer as part of the Member's
Aggregate Account balance, irrespective of
the date on which such rollover or plan-to-
plan transfer is accepted.
(7) For the purposes of determining whether two
employers are to be treated as the same
employer in (5) and (6) above, all employers
aggregated under Code Section 414(b), (c),
(m) and (o) are treated as the same employer.
(b) Aggregation Group means either a Required
Aggregation Group or a Permissive Aggregation
Group as hereinafter determined.
(1) Required Aggregation Group: In determining a
Required Aggregation Group hereunder, each
plan of the Employer in which a Key Employee
is a member in the Plan Year containing the
Determination Date or any of the four
preceding Plan Years, and each other plan of
the Employer which enables any plan in which
a
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
Key Employee participates to meet the
requirements of Code Sections 401(a)(4) or
410, will be required to be aggregated. Such
group shall be known as a Required
Aggregation Group.
In the case of a Required Aggregation Group,
each plan in the group will be considered a
Top Heavy Plan if the Required Aggregation
Group is a Top Heavy Group. No plan in the
Required Aggregation Group will be considered
a Top Heavy Plan if the Required Aggregation
Group is not a Top Heavy Group.
(2) Permissive Aggregation Group: The Employer
may also include any other plan not required
to be included in the Required Aggregation
Group, provided the resulting group, taken as
a whole, would continue to satisfy the
provisions of Code Sections 401(a)(4) and
410. Such group shall be known as a
Permissive Aggregation Group.
In the case of a Permissive Aggregation
Group, only a plan that is part of the
Required Aggregation Group will be considered
a Top
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
Heavy Plan if the Permissive Aggregation
Group is a Top Heavy Group. No plan in the
Permissive Aggregation Group will be
considered a Top Heavy Plan if the Permissive
Aggregation Group is not a Top Heavy Group.
(3) Only those plans of the Employer in which the
Determination Dates fall within the same
calendar year shall be aggregated in order to
determine whether such plans are Top Heavy
Plans.
(4) An Aggregation Group shall include any
terminated plan of the Employer if it was
maintained within the last five (5) years
ending on the Determination Date.
(c) Determination Date means (a) the last day of the
preceding Plan Year, or (b) in the case of the
first Plan Year, the last day of such Plan Year.
(d) Key Employee means an Employee as defined in Code
Section 416(i) and the Regulations thereunder.
Generally, any Employee or former Employee (as
well as each of his Beneficiaries) is considered a
Key Employee if he, at any time during the Plan
Year that contains the "Determination Date" or any
of the preceding four(4) Plan Years, has been
included in one of the following categories:
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
(i) an officer of the Employer (as that term is
defined within the meaning of the Regulations
under Code Section 416) having annual "415
Compensation" greater than 150 percent (150%)
of the amount in effect under Code Section
415(b)(1)(A) for any such Plan Year.
(ii) one of the ten employees having annual "415
Compensation" from the Employer for a Plan
Year greater than the dollar limitation in
effect under Code Section 415(c)(1)(A) for
the calendar year in which such Plan Year
ends and owning (or considered as owning
within the meaning of Code Section 318) both
more than one-half percent (0.5%) interest
and the largest interests in the Employer.
(iii) a "five percent owner" of the Employer.
"Five percent owner" means any person who
owns (or is considered as owning within the
meaning of Code Section 318) more than five
percent (5%) of the outstanding stock of the
Employer or stock possessing more than five
percent (5%) of the total combined voting
power of all stock of the Employer or, in the
case of an unincorporated business, any
person who owns more than five percent (5%)
of the capital or
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
profits interest in the Employer. In
determining percentage ownership hereunder,
employers that would otherwise be aggregated
under Code Sections 414(b), (c), (m) and (o)
shall be treated as separate employers.
(iv) a "one percent owner" of the Employer having
annual "415 Compensation" from the Employer
of more than $150,000. "One percent owner"
means any person who owns (or is considered
as owning within the meaning of Code Section
318) more than one percent (1%) of the
outstanding stock of the Employer or stock
possessing more than one percent (1%) of the
total combined voting power of all stock of
the Employer or, in the case of an
unincorporated business, any person who owns
more than one percent (1%) of the capital or
profits interest in the Employer. In
determining percentage ownership hereunder,
employers that would otherwise be aggregated
under Code Sections 414(b), (c), (m) and (o)
shall be treated as separate employers.
However, in determining whether an individual
has "415 Compensation" of more than $150,000,
"415 Compensation" from each employer
required to be aggregated under Code
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
Sections 414(b), (c), (m) and (o) shall be
taken into account. For purposes of this
Section, "415 Compensation" means
Compensation as defined in Plan Section
4.06(d), except that the determination of
"415 Compensation" shall be made without
regard to Code Sections 125, 402(e)(3),
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).
(e) Non-Key Employee means any Employee or former
Employee (and his Beneficiaries) who is not a Key
Employee.
(f) Present Value of Accrued Benefit In the case of a
defined benefit plan, the Present Value of Accrued
Benefit for a Member other than a Key Employee,
shall be as determined using the single accrual
method used for all plans of the Employer and
Affiliated Employers, or if no such single method
exists, using a method which results in benefits
accruing not more rapidly than the slowest accrual
rate permitted under code Section 411(b)(1)(C).
(g) Top Heavy Group means an Aggregation Group in
which as of the Determination Date, the sum of:
<PAGE>
4.08 DETERMINATION OF TOP HEAVY STATUS continued:
(1) the Present Value of Accrued Benefits of Key
Employees under all defined benefit plans
included in the group, and
(2) the Aggregate Accounts of Key Employees under
all defined contribution plans included in
the group,
exceeds sixty percent (60%) of a similar sum
determined for all Members.
4.09. TOP HEAVY REQUIREMENTS.
(a) Minimum Allocations Required for Top Heavy Plan
Years. For any Top Heavy Plan Year, the sum of
the Employer's contributions and Forfeitures
allocated to the Account of each Non-Key Employee
shall be equal to at least three percent (3%) of
such Non-Key Employee's "415 Compensation"
(reduced by contributions and Forfeitures, if any,
allocated to each Non-Key Employee in any defined
contribution plan included with this Plan in a
Required Aggregation Group). However, if (i) the
sum of the Employer's contributions and
Forfeitures allocated to the Account of each Key
Employee for such Top Heavy Plan Year is less than
three percent(3%) of each Key Employee's "415
Compensation" and (ii) this Plan is not required
to be included in an Aggregation Group to enable a
defined benefit plan
<PAGE>
4.09. TOP HEAVY REQUIREMENTS continued:
to meet the requirements of Code Section 401(a)(4)
or 410, the sum of the Employer's contributions
and Forfeitures allocated to the Account of each
Non-Key Employee shall be equal to the largest
percentage allocated to the Account of any Key
Employee. For the purposes of this Section, "415
Compensation" shall be limited to $200,000
($150,000 effective for Plan Years beginning
January 1, 1994) unless adjusted in such manner as
permitted under Code Section 415(d).)
For purposes of the minimum allocations set forth
above, the percentage allocated to the Account of
any Key Employee shall be equal to the ratio of
the sum of the Employer's contributions and
Forfeitures allocated on behalf of such Key
Employee divided by the "415 Compensation" for
such Key Employee. For any Top Heavy Plan Year,
the minimum allocations set forth above shall be
allocated to the Accounts of all Non-Key Employees
who are Members and who are employed by the
Employer on the last day of the Plan Year. In
lieu of the above, in any Plan Year in which a
Non-Key Employee is a Member in both this Plan and
a defined benefit pension plan included in a
Required Aggregation Group which is
<PAGE>
4.09. TOP HEAVY REQUIREMENTS continued:
top heavy, the Employer shall not be required to
provide such Non-Key Employee with both the full
separate defined benefit plan minimum benefit and
the full separate defined contribution plan
minimum allocation.
For purposes of determining minimum allocations,
the CODA Contributions and Cone Contributions for
Highly Compensated Employees shall be taken into
account but the CODA Contributions for Non-Highly
Compensated Employees shall not be taken into
account.
(b) Minimum Vesting: In accordance with Plan Section
5.01, a Member is 100% vested in his Account at
all times.
(c) Impact on Maximum Benefits: For any Plan Year in
which the Plan is a Top-Heavy Plan, Plan Section
4.06 shall be applied by substituting the number
"1.00" for the number "1.25" wherever it appears
therein except such substitution shall not have
the effect of reducing any benefit accrued under a
defined benefit plan prior to the first day of the
Plan Year in which this provision becomes
applicable.
<PAGE>
4.09. TOP HEAVY REQUIREMENTS continued:
(d) Notwithstanding anything contained herein to the
contrary, the requirements prescribed in this
Section shall at all times comply with the
provisions of Code Section 416 and the Regulations
thereunder, the terms of which are specifically
incorporated herein by reference.
<PAGE>
ARTICLE V
VESTING
5.01. VESTED ACCOUNTS.
(a) Each Member's CODA Contributions Account and
Voluntary Contributions Account, if applicable,
are nonforfeitable (100% vested).
(b) (1) If, before January 1, 1989, a Member had a
voluntary Severance from Service Date (other
than by retirement or death) and had incurred
a one-year Break in Service, his Cone
Contributions Accounts are vested
(nonforfeitable) according to the following
schedule:
Vested Percentage
Years of Service Cone Contributions
After age 18 Account
Less than 4, 0%
4 but less than 5 50%
5 or more 100%
Before January 1, 1989, a Member's Cone
Contributions Accounts were 100% vested on the
earlier of his 65th birthday (normal retirement
date) or his death, or at his involuntary
Severance from Service Date.
(2) Each Member of the Plan who is employed by an
Employer on or after January 1, 1989, and
each Member of the Plan on January 1, 1989,
who was not then employed by an Employer but
who had
<PAGE>
5.01 VESTED ACCOUNTS continued:
not yet incurred a one-year Break in Service is
100% vested in his Cone Contributions Accounts.
5.02. FORFEITURES.
For Plan Years beginning on and after January 1, 1989,
each Member's Accounts in the SRP and EEP are
nonforfeitable (100% vested); therefore, no Forfeitures
shall occur or shall be subject to allocation in such
Plan Years.
<PAGE>
ARTICLE VI
DISTRIBUTION OF BENEFITS
6.01. CLAIM PROCEDURE.
The Advisory Committee may require any person entitled
to benefits to complete an application for payment and to
select the method under which benefits are to be paid.
If a claim is wholly or partially denied, the Advisory
Committee will furnish the claimant a written
explanation within ninety days unless special
circumstances require an extension of time. If an
extension is needed, the Advisory Committee will notify
the claimant before the ninety-day period expires
informing him that the written explanation will be sent
within the second ninety-day period. The written
notice will state: (1) the specific reason or reasons
for denial; (2) specific reference to pertinent Plan
provisions on which the denial is based; (3) a
description of any additional material or information
necessary for the claimant to perfect the claim and an
explanation of why such material or information is
necessary; and (4) appropriate information as to the
steps to be taken if the member or Beneficiary wishes
to submit the claim for review.
6.02. REVIEW OF CLAIMS.
The claimant or a duly authorized representative may,
within sixty days after receipt by the claimant of a
written notification or denial of a claim: (1) request
<PAGE>
6.02. REVIEW OF CLAIMS continued:
a review by the Advisory Committee upon written
application to the Committee; (2) review pertinent
documents; and (3) submit issues and comments in
writing. A decision by the Advisory Committee shall be
made promptly but in any event not later than
sixty days after receipt of a request for
review unless special circumstances require
an extension of time, in which event a
decision shall be rendered not later than one
hundred twenty days after receipt of such
request. Written notice of any such
extension shall be furnished to the claimant
prior to the commencement of the extension.
The decision on review shall be in writing,
shall include specific reasons for the
decision and shall be furnished to the
claimant within the appropriate time
described in this Section 6.02.
6.03. DISTRIBUTION DEFINITIONS.
(a) Spousal Consent means with respect to a Member's
election to designate a Beneficiary other than his
Spouse, the Spouse's written consent to the
Beneficiary or Beneficiaries designated, which
Beneficiary or Beneficiaries may not be changed
without a further Spousal Consent (unless the
Spousal Consent expressly permits changes without
a further Spousal Consent).
<PAGE>
6.03. DISTRIBUTION DEFINITIONS continued:
(b) Spouse or Surviving Spouse is defined in Plan
Section 1.47.
6.04. METHODS OF PAYMENT.
(a) After a Member has a Severance from Service Date
and submits the appropriate claim forms, election
forms and income tax withholding forms, and
subject to the rights of any Alternate Payee under
a Qualified Domestic Relations Order, the Advisory
Committee shall direct the Trustee to distribute
the vested portion of the Member's Accounts by one
of the following methods as elected by such
Member:
(1) In a single, lump sum distribution.
(2) In monthly installments of a specified amount
over a fixed period not to exceed the life
expectancy of the Member or the joint life
expectancies of the Member and his designated
Beneficiary.
(3) By a combination of the methods set forth in
(1) and (2) above.
The Advisory Committee may adjust installment
elections so as not to be administratively
burdensome.
<PAGE>
6.04. METHODS OF PAYMENT continued:
(b) If a Member has a Severance from Service and the
vested portion of his Cone Contributions Account
is $3,500 or less, distribution will only be made
in a single lump sum amount or direct trustee-to-
trustee transfer; in such event, the Member shall
not be entitled to elect any other method of
payment pursuant to paragraph (a) above. If the
vested portion of such Member's Account is over
$3,500, distribution before the Member's sixty-
fifth birthday shall be made only with the consent
of the Member.
(c) If a Member's Beneficiary is not the Member's
Spouse, a monthly installment distribution method
may not be elected if it provides for payments
during the Member's life expectancy that are less
than 50% of the present value of the total
payments to be made to the Member and his
Beneficiary. Life expectancy shall be determined
by use of tables, prepared on a unisex basis, and
contained in U. S. Treasury Department
Regulations.
(d) Distributions from the Plan must be in cash,
except that the receiving Member may elect to
receive his distribution from the EEP in the form
of Qualifying Employer Securities unless such a
distribution is restricted according to the
Employer's bylaws or
<PAGE>
6.04. METHODS OF PAYMENT continued:
articles of incorporation. If a Member entitled
to a stock distribution has assets other than
Qualifying Employer Securities forming part of the
vested portion of his EEP Accounts, and if he
exercises his right to elect to receive such
Qualifying Employer Securities, those other assets
must be converted at fair market value (in
accordance with Plan Section 6.11) into any
Qualifying Employer Securities to which he may be
entitled by Code Section 401(a)(23) or 409(h), as
selected by the Advisory Committee, and then
distributed. Balances representing fractional
shares may be paid in cash. The Advisory
Committee may direct the Trustee of the EEP to
obtain Qualifying Employer Securities necessary
for distribution from whatever source might be
available to the Trustee. If the Trustee cannot
find other Qualifying Employer Securities
available for conversion, the Advisory Committee
may direct the Trustee to purchase Qualifying
Employer Securities from the EEP Accounts of other
Members. The issuer of a security to be
distributed may impose any transfer restrictions
allowable under state or federal securities laws
on any stock distributed pursuant to this
subsection.
<PAGE>
6.04. METHODS OF PAYMENT continued:
(e) In the case of a distribution of Qualifying
Employer Securities which are not readily tradable
on an established securities market, the EEP shall
provide the Member with a put option that complies
with the requirements of Section 409(h) of the
Code. Such put option shall provide that if a
Member exercises the put option, the Employer, or
the EEP if the EEP elects to assume the Employer's
obligation, shall repurchase the Qualifying
Employer Securities as follows:
(1) If the distribution constitutes a total
distribution of the vested portion of a
Member's EEP Accounts, payment of the fair
market value of the Member's account balance
shall be made in a lump sum or in annual
installments over a period not exceeding five
years. If paid in installments, the first
installment shall be paid not later than 30
days after the Member exercises the put
option. The purchaser will pay a reasonable
rate of interest and provide adequate
security on amounts not paid after 30 days.
(2) If the distribution does not constitute a
total distribution of the vested portion of a
Member's EEP Account, the purchaser shall pay
<PAGE>
6.04. METHODS OF PAYMENT continued:
the Member an amount equal to the fair market
value of the Qualifying Employer Securities
repurchased no later than 30 days after the
Member exercises the put option.
(f) Shares of Qualifying Employer Securities
distributed by the Plan shall be subject to the
"right of first refusal" described in this Section
6.04(f) so long as they are not readily tradable
on an established securities market. Prior to any
transfer of such shares, the shares must first be
offered in writing to the Trustee of the EEP and
then if refused by the Trustee, to Cone at a price
equal to the purchase price offered by a third
party buyer (other than the Trustee of the EEP or
Cone) making a good faith (as determined by the
Advisory Committee) offer to purchase such shares;
provided, however, that the Trustee shall in no
event purchase shares at a price in excess of
their fair market value. The Trustee of the EEP
or Cone, as the case may be, may accept the offer
as to part or all of the Qualifying Employer
Securities at any time during the period not
exceeding 14 days after receipt of such offer by
the Trustee, on terms and conditions no less
favorable to the shareholder than those offered by
the third-party buyer. Any
<PAGE>
6.04. METHODS OF PAYMENT continued:
installment purchase shall be made pursuant to a
note secured by the shares purchased and shall
bear a reasonable rate of interest. If the offer
is not accepted by the Trustee of the EEP, Cone,
or both, then the proposed transfer may be
completed within a 30-day period following the end
of the aforementioned 14-day period, but only upon
terms and conditions no less favorable than the
terms and conditions of the third-party buyer's
original offer. If the proposed transfer is not
completed within the aforementioned 30-day period,
then the shares will again be subject to the right
of first refusal described in this Section
6.04(f).
6.05. COMMENCEMENT OF BENEFITS.
(a) Subject to Plan Section 6.11, the valuation of a
Member's Accounts for purposes of determining the
amount of benefit payment(s) is made as of the
Valuation Date immediately following the date on
which he becomes eligible for such payment(s)
pursuant to this Section 6.05.
(b) Unless a Member elects otherwise, benefit payments
must begin no later than 60 days after the close
of the Plan Year in which occurs the latest of:
(1) his 65th birthday;
<PAGE>
6.05. COMMENCEMENT OF BENEFITS continued:
(2) the 10th anniversary of the date he became a
Member of the Plan; or
(3) his Severance from Service.
(c) A Member who has an involuntary Severance from
Service and who receives Approved Leave with or
without pay shall be eligible to receive a
distribution of the balance in his Accounts in
accordance with Plan Section 6.04 within 75 days
of the Valuation Date immediately following his
last day of active employment, provided that the
Member terminates his election to have CODA
Contributions made on his behalf to the Plan so
that no further CODA Contributions will be made
after such Valuation Date.
(d) If for any reason the benefit amount cannot be
accurately determined before payment is required,
or if it is not possible to pay when required
because the Advisory Committee has been unable to
locate the Member, after making reasonable efforts
to do so, a payment retroactive to the required
date may be made not later than 60 days after the
earliest date on which the amount of that payment
can be determined, or the date on which the Member
is located (whichever is applicable).
<PAGE>
6.05. COMMENCEMENT OF BENEFITS continued:
(e) Distributions pursuant to this Section 6.05(e) may
be requested by a Member who has a Severance from
Service date prior to January 1, 1993, and by the
Beneficiary of a Member who dies before January 1,
1993. A distribution pursuant to this Section
6.05(e) shall begin or be made, subject to Section
6.05(d), within 90 days of the Valuation Date
immediately following such Severance from Service
Date or Death. At the election of the Member or
Beneficiary, up to 90% of the value of the
Member's Accounts as of the Valuation Date
immediately preceding the Severance from Service
Date or death will be distributed within 15 days
after the Valuation Date immediately following
such Severance from Service Date or death, with
the balance distributed by April 1 or October 1
following the applicable Valuation Date.
(f) Distributions pursuant to this Section 6.05(f) may
be requested by a Member who has a Severance from
Service Date after December 31, 1992, and by the
Beneficiary of a Member who dies after
December 31, 1992. A distribution pursuant to
this Section 6.05(f) shall begin or be made,
subject to Section 6.05(d), within 75 days of the
Valuation Date immediately following such
Severance from
<PAGE>
6.05. COMMENCEMENT OF BENEFITS continued:
Service Date or death.
6.06. SPECIAL DISTRIBUTION PROVISIONS.
(a) Distribution of the entire interest of a Member
must be or begin no later than April 1 of the
calendar year following the calendar year in which
he attains age 70-1/2 whether or not he has a
Severance from Service. If distribution has not
started by the required beginning date described
in the preceding sentence, it must begin not later
than that required beginning date and be payable
over a period not exceeding the life of the
Member, or the life expectancy of the Member, or
the lives of the Member and a designated
Beneficiary, or the life expectancies of the
Member and a designated Beneficiary. Life
expectancy shall be determined in accordance with
U. S. Treasury Department regulations and may be
redetermined annually.
(b) If the distribution of a Member's account has
begun in accordance with paragraph (a) and the
Member dies before his entire Account balance has
been distributed, the remaining portion of his
Account balance must be distributed at least as
rapidly as under the method of distribution being
used as of the date of the Member's death. If a
Member dies before the distribution of his Account
balance has
<PAGE>
6.06. SPECIAL DISTRIBUTION PROVISIONS continued:
begun, his entire Account balance must be
distributed within five years after his death.
6.07. DEATH BENEFITS.
(a) Subject to the rights of any Alternate Payee under
a Qualified Domestic Relations Order, if a Member
having a vested interest in the Plan dies before
receiving a distribution of his Account balance
with a Surviving Spouse, his vested Account
balance, valued in accordance with Plan Section
6.11, shall be distributed to the Surviving Spouse
in accordance with subsection (b), unless the
Member had made an effective election pursuant to
subsection (c).
(b) Unless the Surviving Spouse elects a later date,
distribution of the Member's vested Account
balance shall be made or begin no later than 60
days after the end of the Plan Year in which death
occurs, except as permitted under Plan Section
6.05(d). Payment shall be made under one of the
methods provided in Plan Section 6.04.
Notwithstanding the foregoing, if the aggregate
amount of the Member's vested Account balance is
$3,500 or less, such amount shall be distributed
to the Surviving Spouse in a single lump-sum
payment. No distribution shall be made pursuant
to this subsection (b) until
<PAGE>
6.07. DEATH BENEFITS continued:
the Advisory Committee has received proof of the
Member's death and appropriate claim, election and
tax withholding forms.
(c) A Member may designate a Beneficiary or
Beneficiaries (other than his Spouse) in
accordance with subsection (d) to receive death
benefits under this Plan; provided, however, that
no Beneficiary designation in accordance with
subsection (d) shall be effective unless
accompanied by a Spousal Consent. A Member may
revoke any Beneficiary designation and, subject to
any required Spousal Consent, may designate
another Beneficiary or Beneficiaries.
(d) On forms provided by the Advisory Committee, each
Member without a Spouse and, subject to Spousal
Consent, each Member with a Spouse may designate
or change a Beneficiary or Beneficiaries to
receive death benefits under the Plan. A
Beneficiary designation is effective when received
by the Advisory Committee. Any designation of a
Beneficiary by a Member without a Spouse shall
become void and of no further force and effect if
the Member later marries. If a Beneficiary or
Beneficiaries are designated in accordance with
this subsection (d), and if distribution of
<PAGE>
6.07. DEATH BENEFITS continued:
benefits under this Plan has not begun before a
Member's death, then, after the Advisory Committee
receives proof of the Member's death, it shall
request his Beneficiary or Beneficiaries to submit
claim, election and tax withholding forms.
Subject to the rights of any Alternate Payee under
a Qualified Domestic Relations Order, the Advisory
Committee, upon receiving these forms, shall
direct the Trustee to distribute the Member's
Account, valued no later than the end of the Plan
Year during which death occurs, to his Beneficiary
or Beneficiaries. Distribution will be made or
begin no later than 60 days after the end of the
Plan Year in which death occurs, except as
permitted under Plan Section 6.05(d), and, subject
to Plan Section 6.06(b), shall be made by one of
the methods described in Plan Section 6.04, as
elected by the Beneficiary or Beneficiaries.
Notwithstanding the foregoing, if the amount
distributable under this subsection (d) is $3,500
or less, such amount shall be distributed in a
single lump sum payment. If a Member had elected
installment payments pursuant to Plan Section 6.04
and had designated a Beneficiary or Beneficiaries
in accordance with this subsection (d), then any
<PAGE>
6.07. DEATH BENEFITS continued:
installment payments becoming due after his death
shall be made to the Beneficiary or Beneficiaries
so designated, unless they elect to accelerate
payment thereof. If there is no effective
beneficiary designation in effect at the time of a
Member's death, then subject to any required
Spousal Consent and to the rights of any Alternate
Payee, the Member's estate shall be entitled to
receive his vested Account balance.
6.08. QUALIFIED DOMESTIC RELATIONS ORDER.
Except as provided in this Section 6.08, Plan benefits
may not be assigned, alienated or in any other way made
subject to debts or other obligations of Members of
Beneficiaries. Notwithstanding the above, the Advisory
Committee must comply with the terms of a Qualified
Domestic Relations Order which is a judgment, decree or
order (including approval of a property settlement
agreement) made pursuant to a state domestic relations
law (including community property law), that relates to
the provision of child support, alimony payments or
marital property rights of a Spouse, former Spouse,
child or other dependent ("Alternate Payee") of a
Member. A Qualified Domestic Relations Order creates
or recognizes the existence of an Alternate Payee's
right to, or assigns to an Alternate Payee the right
to, receive all
<PAGE>
6.08. QUALIFIED DOMESTIC RELATIONS ORDER continued:
or a portion of the benefits payable to a Member under
his Plan and specifies the following:
(1) the name and last know mailing address of the
Member and each Alternate Payee;
(2) the amount or percentage of the Member's Plan
benefits to be paid to any Alternate Payee,
or the manner in which such amount or
percentage is to be determined; and
(3) the number of payments or the period to which
the Order applies and the name of the plan(s)
to which the Order relates.
Plan benefits will be paid pursuant to a Qualified
Domestic Relations Order to such Alternative Payee(s)
at such times and in such amounts as are stated
therein, provided however, that such Qualified Domestic
Relations Order may not require the Plan to provide any
type or form of benefit, or any option not otherwise
provided. It also may not require the Plan to provide
increased benefits and may not require the payment of
benefits to an Alternate Payee prior to the Member's
"earliest retirement age" as defined in Code Section
414(p). The Advisory Committee shall establish
reasonable procedures to determine the qualified status
of domestic relations orders and to administer
distributions under such Orders.
<PAGE>
6.09. WITHHOLDING OF BENEFITS.
If a Member has a Severance from Service and returns to
regular employment of the Employer, the Advisory
Committee may suspend payment of any benefit which such
Member would have received from the Plan during any
such period of reemployment.
6.10. HARDSHIP WITHDRAWAL.
(a) Upon written application on forms provided by the
Advisory Committee and subject to the provisions
of this Section 6.10, a Member shall be permitted
to withdraw a specified whole dollar amount from
the vested balance in his individual Accounts to
the extent such withdrawal is necessary to meet
the following documented immediate and heavy
financial need of the Member:
(1) medical expenses described in Code Section
213(d) of the Member, his Spouse or
dependents;
(2) purchase (excluding mortgage payments) of a
principal residence of the Member;
(3) tuition and related education fees (but not
room and board) for the next twelve (12)
months of post-secondary education for the
Member, his Spouse, or dependents;
<PAGE>
6.10. HARDSHIP WITHDRAWAL continued:
(4) the need to prevent eviction of the Member
from his principal residence or foreclosure
on the mortgage of his principal residence;
plus, any amounts necessary to pay any federal,
state or local income taxes or penalties
reasonably anticipated to result from the
distribution.
No such withdrawal shall be permitted to the
extent that the immediate and heavy financial need
proposed to be met thereby may be met from other
resources that are reasonably available to the
Member and, for this purpose, the Member's
resources shall be deemed to include those assets
of his Spouse and minor children that are
reasonably available to the Member. Accordingly,
no withdrawal from a Member's Accounts shall be
permitted unless the Member has represented to the
Advisory Committee in writing that his immediate
and heavy financial need cannot be relieved: (1)
through reimbursement or compensation by insurance
or otherwise; (2) by reasonable liquidation of the
Employee's assets, to the extent such liquidation
would not itself cause an immediate and heavy
financial need; (3) by cessation of elective
contributions or Employee contributions under the
<PAGE>
6.10. HARDSHIP WITHDRAWAL continued:
Plan; (4) by other distributions or nontaxable
loans from plans maintained by Cone or by any
other Employer of the Member; or (5) by borrowing
from commercial sources on reasonable commercial
terms. Amounts withdrawn shall be in the
following order: (1) a portion or all of the SRP
Voluntary Contributions Account; (2) a portion or
all of the SRP Cone Contributions Accounts; (3) a
portion or all of the SRP CODA Contributions
Account; (4) a portion or all SRP Investment
Earnings attributable to Plan Years ending before
January 1, 1989; (5) a portion or all of the EEP
Voluntary Contributions Account; (6) a portion or
all of the EEP Cone Contributions Account; (7) a
portion or all of the EEP CODA Contributions
Account. Subject to paragraph (b), the maximum
amount subject to withdrawal is the vested balance
in the Member's Accounts as of the end of the Plan
Year immediately preceding the date of
application, but in no event shall a withdrawal be
in excess of the amount necessary to meet the
immediate and heavy financial need of the Member,
and a withdrawal of less than $300 shall not be
permitted.
<PAGE>
6.10. HARDSHIP WITHDRAWAL continued:
(b) Beginning January 1, 1989, the amount of any
hardship withdrawal cannot exceed the sum of the
Member's Accounts, including Investment Earnings
thereon attributable to Plan Years ending before
January 1, 1989, (but excluding Investment
Earnings thereon attributable to Plan Years ending
after December 31, 1988, and all Investment
Earnings attributable to the EEP Company Stock
Fund). The order of withdrawal rules in paragraph
(a) will apply.
(c) The determination required to be made under this
Section 6.10 by the Advisory Committee shall be
made in a uniform and non-discriminatory manner on
the basis of all relevant facts and circumstances.
Hardship withdrawals are not subject to the
Advisory Committee's discretion, except to the
extent reasonably necessary to determine whether
the conditions set forth in paragraph (a) have
been met, and the Claim Procedure set forth in
Section 6.01 shall apply. The Advisory Committee
shall be entitled to rely on information and
documentation supplied by a Member in connection
with his written application for a hardship
withdrawal, pursuant to this Plan Section 6.10.
<PAGE>
6.11. VALUATION OF ACCOUNT BALANCES.
For purposes of determining the amount of any
distribution, a Member's Accounts will be determined as
of the Valuation Date immediately preceding the date of
the distribution, except that cash distributions from
the EEP after December 31, 1992, that are attributable
to common stock of Cone will be based on the closing
price of the common stock on the sixtieth day following
such Valuation Date or, if the sixtieth day is not a
business day, the immediately preceding business day.
6.12. WITHHOLDING OF TAXES.
Notwithstanding any other term or provision of this
Article VI, the Advisory Committee will direct the
Trustee to deduct from any distribution made to a
Member such amount as is required to be withheld under
Code Section 3405 and the corresponding provision of
any applicable state law.
6.13. ELIGIBLE ROLLOVER DISTRIBUTIONS.
(a) This Section 6.13 applies to distributions made on
or after January 1, 1993. Notwithstanding any
provision of the Plan to the contrary that would
otherwise limit a distributee's election under
this Section, a distributee may elect, at the time
and in the manner prescribed by the Advisory
Committee, to have any portion of an eligible
rollover distribution paid directly to an eligible
<PAGE>
6.13. ELIGIBLE ROLLOVER DISTRIBUTIONS continued:
retirement plan specified by the distributee in a
direct rollover.
(b) Definitions.
(1) Eligible rollover distribution: An eligible
rollover distribution is any distribution of
all or any portion of the balance to the
credit of the distributee, except that an
eligible rollover distribution does not
include: any distribution that is one of a
series of substantially equal periodic
payments (not less frequently than annually)
made for the life (or life expectancy) of the
distributee or the joint lives (or joint life
expectancies) of the distributee and the
distributee's designated beneficiary, or for
a specified period of ten years or more; any
distribution to the extent such distribution
is required under Section 401(a)(9) of the
Code; and the portion of any distribution
that is not includable in gross income
(determined without regard to the exclusion
for net unrealized appreciation with respect
to employer securities).
<PAGE>
6.13. ELIGIBLE ROLLOVER DISTRIBUTIONS continued:
(2) Eligible retirement plan: An eligible
retirement plan is an individual retirement
account described in Section 408(a) of the
Code, an individual retirement annuity
described in Section 408(b) of the Code, an
annuity plan described in Section 403(a) of
the Code, or a qualified trust described in
Section 401(a) of the Code, that accepts the
distributee's eligible rollover distribution.
However, in the case of an eligible rollover
distribution to the Surviving Spouse, an
eligible retirement plan is an individual
retirement account or individual retirement
annuity.
(3) Distributee: A distributee includes an
Employee or former Employee. In addition,
the Employee's or former Employee's Surviving
Spouse and the Employee's or former
Employee's Spouse or former Spouse who is the
alternate payee under a Qualified Domestic
Relations Order, as defined in section 414(p)
of the Code, are distributees with regard to
the interest of the Spouse or former Spouse.
<PAGE>
6.13. ELIGIBLE ROLLOVER DISTRIBUTIONS continued:
(4) Direct rollover: A direct rollover is a
payment by the Plan to the eligible
retirement plan specified by the distributee.
<PAGE>
ARTICLE VII
INVESTMENT OF ACCOUNTS
7.01. INVESTMENT FUNDS.
(a) The Trustee of the SRP shall establish and
maintain three Investment Funds. The first fund,
known as the Fixed Income Fund, shall be invested
in interest bearing accounts, certificates of
deposit, money market securities and other
interest bearing investments which involve a
minimum or no risk to principal. The second fund,
known as the Balanced Fund, shall be invested
primarily in common and preferred stocks,
corporate and government bonds, debentures and
other evidences of indebtedness. The third fund,
known as the Diversified Common Stock Fund, shall
be invested primarily in common stocks. The
Trustee of the SRP shall establish and maintain
other Investment Funds if directed to do so by the
Board of Directors. The Investment Funds
maintained by the Trustee of the SRP shall be
utilized in investing the individual SRP Accounts
of Members and Beneficiaries.
(b) Plan assets held in the SRP Trust Fund and
attributable to Members' SRP CODA Contributions
and SRP Voluntary Contributions, that is, any
funds allocated or allocable to SRP CODA
Contributions
<PAGE>
7.01 INVESTMENT FUNDS continued:
Accounts or SRP Voluntary Contributions Accounts
shall not be invested in any securities or other
properties whatsoever of Cone or Affiliates.
(c) The Trustee of the EEP shall establish and
maintain two Investment Funds. The first fund,
known as the Company Stock Fund, shall be invested
solely in Qualifying Employer Securities (as
defined in Section 407(d)(5) of ERISA). The
second fund, known as the Other Investments Fund
shall be invested in interest bearing accounts,
certificates of deposit, money market securities
and other interest bearing investments which
involve a minimum or no risk to principal. The
Investment Funds maintained by the Trustee of the
EEP shall be utilized in investing the individual
EEP Accounts of Members and Beneficiaries.
7.02. DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS.
(a) At least 30 days prior to each January 1, April 1,
July 1 and October 1 each Member shall have the
right to direct the Advisory Committee as to the
investment of all funds in his individual SRP
Accounts during the next three months. Such
election shall be in writing on a form provided by
the Advisory Committee and shall indicate which
amounts, in 25% increments, are to be invested in
<PAGE>
7.02 DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS continued:
each of the SRP Investment Funds. In the event no
election is made on a timely basis, the Member's
individual Accounts shall remain invested in the
same manner as during the prior period in
accordance with his last election.
(b) Members shall not have the right to direct the
investment of EEP Accounts. EEP Accounts shall be
invested by the Trustee of the EEP primarily in
the Company Stock Fund, and the Other Investments
Fund will be used primarily as a temporary fund
whose assets will be used to purchase Qualifying
Employer Securities or to make distributions in
accordance with Article VI.
(c) Notwithstanding any other provisions of this
Section 7.02, effective January 1, 1991, a Member
who has attained age 60 and who has an EEP Account
balance may elect on forms provided by the
Advisory Committee, to transfer such balance to
the SRP Investment Funds. Transfers as permitted
by this Section 7.02(c) shall be effective on
January 1 of each Plan Year, with respect to
Members who are age 60 or older on or before the
December 31 Valuation Date immediately preceding
such January 1. The initial transfer by any
Member shall be 50% of the value of his EEP
Account balance as of the
<PAGE>
7.02 DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS continued:
December 31 Valuation Date immediately preceding
the January 1 effective date. A Member shall be
allowed a second transfer effective no sooner than
one year after such initial transfer; the second
transfer shall be the Member's remaining EEP
Account balance. A Member shall not be allowed
more than two transfers pursuant to this Section
7.02(c). The Advisory Committee shall restrict
rights to transfer by Highly Compensated Employees
which may otherwise be permitted by this Section
7.02(c) to the extent necessary to cause
compliance with Treasury Regulation 1.401(a)(4)-4.
If restricting transfer rights by Highly
Compensated Employees becomes necessary, then to
the extent required to comply with Treasury
Regulation 1.401(a)(4)-4, the Advisory Committee
shall not allow transfer rights to be elected by
Highly Compensated Employees as of any applicable
December 31 Valuation Date in the following order:
First - by those Highly Compensated Employees
who have attained age 60.
<PAGE>
7.02 DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS continued:
Second - by those Highly Compensated Employees
who have attained age 61.
Third - by those Highly Compensated Employees
- who have attained age 62.
Fourth - by those Highly Compensated Employees
who have attained age 63.
Fifth - by those Highly Compensated Employees
who have attained age 64 or any older
age.
(d) Effective January 1, 1993, in accordance with
uniform and nondiscriminatory procedures adopted
from time to time by the Advisory Committee, a
Member who has an EEP Account balance may elect to
transfer such balance to the SRP Investment Funds
over a period of four Plan Years as follows:
(1) For the first Plan Year in which a transfer
is elected, 25% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made;
(2) For the second Plan Year in which a transfer
is elected, 33-1/3% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made;
<PAGE>
7.02 DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS continued:
(3) For the third Plan Year in which a transfer
is elected, 50% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made; and
(4) For the fourth Plan Year in which a transfer
is elected, 100% of the Member's total EEP
Account balance as of the Valuation Date
immediately preceding the date on which the
transfer is made.
Notwithstanding the foregoing, if the total value
of a Member's EEP Account balance does not exceed
$5,000 as of any Valuation Date, he may elect to
have such balance transferred to the SRP
Investment Funds, provided that only one transfer
shall be permitted of an EEP Account balance that
does not exceed $5,000. The Advisory Committee
shall restrict rights to transfer by Highly
Compensated Employees which may otherwise be
permitted by this Section 7.02(d) to the extent
necessary to cause compliance with Treasury
Regulation 1.401(a)(4)-4. If restricting transfer
rights by Highly Compensated Employees becomes
necessary, then to the extent required to comply
with the Treasury Regulation 1.401(a)(4)-4, the
Advisory Committee
<PAGE>
7.02 DIRECTING INVESTMENT OF INDIVIDUAL ACCOUNTS continued:
shall not allow transfer rights to be elected by
Highly Compensated Employees as of any applicable
Valuation Date in the following order:
(i) By those Highly Compensated Employees
described in Code Section 414(q)(1)(A)
or (B).
(ii) By those Highly Compensated Employees
described in Code Section 414(q)(1)(C)
and not included in category (i) above.
(iii)By those Highly Compensated Employees
described in Code Section 414(q)(1)(D)
and not included in category (i) or (ii)
above.
7.03. SEGREGATED ACCOUNT.
If a terminated Member's or Beneficiary's distribution
is payable in installments which extend more than 6
months after the normal payment date for a lump sum
distribution, then, as of the January 1 coinciding with
or next following the date on which the election to
receive installment payments is made, the individual
SRP Accounts shall be invested in the Fixed Income Fund
and, subject to Plan Section 6.04(d), the individual
EEP Accounts shall be invested in the Other Investments
Fund.
<PAGE>
ARTICLE VIII
TRUST FUND AND ADMINISTRATION OF THE PLAN
8.01. NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY.
(a) Plan Fiduciaries are Cone (acting through the
Board of Directors), each Trustee or Co-Trustee,
the Advisory Committee and any other Committee
appointed pursuant to Plan Section 8.06. Each
Fiduciary shall have only those powers, duties,
responsibilities and obligations that are
specifically assigned under the Plan or Trust
Agreement. A Fiduciary may serve in more than one
capacity with respect to the Plan. The Board of
Directors shall appoint the Advisory Committee and
any Trustee or successor Trustees or Co-Trustees
and any other Fiduciaries.
(b) Each Trustee has custody and sole responsibility
for administration of the Trust Fund of which it
is the Trustee, but a Trustee's authority to
manage, acquire or dispose of assets of the Plan
is subject to such investment policies and
guidelines as may be adopted from time to time by
the Board of Directors and communicated to such
Trustee. If an Investment Manger is appointed
according to a Trust Agreement, the Trustee or
each Co-Trustee under that Trust Agreement is
released from any obligation or liability for the
investment of the
<PAGE>
8.01. NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
continued:
assets for which the appointment is made.
(c) The Advisory Committee has only the
responsibilities described in this Plan and those
delegated by Cone. The Advisory Committee has no
responsibility for the control or management of
the Trust Fund.
(d) Other Committees appointed pursuant to Plan
Section 8.06 shall have such authority and
responsibilities as may be delegated by the Board
of Directors.
(e) All responsibilities not specifically delegated to
a Fiduciary remain with Cone, including
designating other Fiduciaries not named in this
Plan or the Trust Agreement. A Fiduciary serves
at the pleasure of Cone and may employ one or more
persons to render advice with regard to any
responsibility such Fiduciary has under the Plan.
Each Fiduciary may rely upon any direction,
information or action of another Fiduciary, as
being proper under the Plan or Trust Agreement and
shall not be required to inquire into the
propriety of any such direction, information or
action. It is intended that each Fiduciary be
responsible for the proper exercise of its own
power, duties, responsibilities and obligations
and shall not be responsible for
<PAGE>
8.01. NAMED FIDUCIARIES AND ALLOCATION OF RESPONSIBILITY
continued:
any act or omission of another Fiduciary except to
the extent that he has knowledge of a breach of
Fiduciary responsibility by another Fiduciary and
fails to make reasonable effort to remedy the
breach.
8.02. DUTIES AND RESPONSIBILITIES.
Each Fiduciary shall discharge his duties with respect
to the Plan solely in the interest of Members and
Beneficiaries for the exclusive purpose of providing
benefits to Members and Beneficiaries and for defraying
reasonable expenses in administering the Plan, with the
care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man acting
in a like capacity and familiar with such matters would
use in the conduct of an enterprise of a like character
and with like aims, and in accordance with the
documents and instruments governing the Plan insofar as
such documents and instruments are consistent with the
provisions of applicable law or regulation.
Notwithstanding the foregoing, the diversification
requirement of ERISA Section 404(a)(1)(C) and the
prudence requirement of ERISA Section 404(a)(1)(B) (to
the extent it requires diversification) shall not apply
to the acquisition and holding of Qualifying Employer
Securities as defined in ERISA Section 407(d) by the
EEP.
<PAGE>
8.03. TRUST FUND.
All of the assets of the Plan shall be held in a Trust
Fund or Funds under a Trust Agreement or Agreements
which shall be a part of the Plan. Any such Trust
Agreement may provide for a master trust containing
assets of more than one plan if the portion or
percentage attributable to each plan is clearly
established and discernible. Each Trustee or Co-
Trustee shall be appointed by the Board of Directors,
and the Board of Directors shall have the sole
authority to appoint and remove any Trustee, Co-Trustee
or successor Trustee or Co-Trustee. All contributions
shall be paid into a Trust Fund. Benefits provided by
the Plan shall be payable from the Trust Fund. The
Trustee or Co-Trustee shall execute such documents and
take any other action necessary to carry out the
instructions of any Investment Manager or the Advisory
Committee.
8.04. ENFORCEABLE RIGHTS.
Cone does not guarantee payment of any benefits
provided for under the Plan. All rights of Members and
Beneficiaries shall be enforceable only against the
Trust Fund except to the extent otherwise guaranteed by
applicable law or regulation. No person shall have any
interest in or right to any part of the corpus or
income of the Trust Fund except as provided in the
Plan.
<PAGE>
8.05. IMPOSSIBILITY OF DIVERSION.
Except as provide in Section 3.02, the assets of the
Plan and the Trust Fund shall not inure to the benefit
of the Employer and shall be held for the exclusive
purposes of providing benefits to Members and
Beneficiaries and defraying reasonable expenses of
administering the Plan.
8.06. ADVISORY COMMITTEE AND OTHER COMMITTEES.
The Board of Directors shall appoint an Advisory
Committee and may appoint other Committees from time to
time, each Committee to consist of at least three (3)
persons who may, but need not be, officers, directors
or Employees of Cone. The members of each Committee
shall hold office at the pleasure of the Board of
Directors and shall serve without compensation. Each
Committee member shall file his written acceptance with
the Board of Directors and acknowledge that he is a
Fiduciary under the Plan. Any Committee member may
resign at any time by delivering his written
resignation to the Board of Directors. Any vacancy
which reduces Committee membership to less than three
shall be filled by the Board of Directors as soon as
practicable.
8.07. OFFICERS, QUORUMS, EXPENSES.
Each Committee may authorize one or more of its members
to execute or deliver any instrument or act on its
behalf. Each Committee shall hold meetings upon such
notice and at such place and times as it may determine.
<PAGE>
<PAGE>
8.07. OFFICERS, QUORUMS, EXPENSES continued:
A majority of the members of each Committee in office
at the time shall constitute a quorum for the
transaction of business. All resolutions or other
actions taken by a Committee shall be by the vote of a
majority of those present at a meeting or without a
meeting by an instrument in writing signed by a
majority of the members. If a Committee member
registers his dissent in writing with respect to any
act or omission by the majority, delivered to the
remaining Committee members within a reasonable time,
such member shall not be responsible for such act or
omission. The expenses of each Committee in performing
its duties and the compensation of its agents shall be
paid by Cone.
8.08. DUTIES OF INVESTMENT MANAGER.
Cone shall have authority to appoint in writing and
obtain the services of one or more Investment Mangers
(as defined in ERISA Section 3(38) whose duties and
responsibilities shall be to manage the investment and
reinvestment of such portion of the Trust Fund as shall
be determined from time to time by the Board of
Directors. Each duly appointed Investment Manager
shall, with respect to the portion of any Trust Fund
for which it is responsible, have the sole authority,
without prior consultation with the Trustee or Cone, to
manage, acquire and dispose of assets of the Trust Fund
but shall not,
<PAGE>
8.08. DUTIES OF INVESTMENT MANAGER continued:
except to the extent permitted in the Trust Agreement,
have physical custody or indicia of ownership of any
such assets. The appointment of an Investment Manger
shall become effective as of the date it delivers to
Cone a written statement acknowledging that it is
Fiduciary as defined in ERISA Section 3(21)(A) and that
it has the responsibility of acquisition and
disposition of that portion of Trust Fund assets
assigned to it. The Investment Manager shall exercise
its power through written directions to the Trustee
signed by an individual whose name and signature
appears on a list furnished by such Investment Manager
to Cone. The Investment Manager shall periodically
deliver to Cone a report describing all Trust Fund
asset transactions for each agreed upon reporting
period. Any compensation or fee due to the Investment
Manger for services rendered shall be paid out of the
Trust Fund, unless paid by Cone in its discretion.
8.09. INFORMATION TO INVESTMENT MANAGER.
Cone shall advise each Investment Manager of the amount
of that portion of any Trust Fund which it is to
manage, the amount of Cone and CODA Contributions to be
added to the Fund and the expected future benefits to
be payable from the Fund in order that the Investment
Manager may establish a funding policy consistent with
current and long-term needs of the Plan and compatible
with the
<PAGE>
8.09. INFORMATION TO INVESTMENT MANAGER continued:
investment policies and guidelines determined by the
Board of Directors.
8.10. NOTICE TO TRUSTEE.
Cone shall notify the Trustee of each Trust Fund for
which an Investment Manager has been appointed of the
name of such Investment Manager and the portion of the
Trust Fund for which such Manager is responsible.
Until notified in writing by Cone that there has been a
change in the appointment of an Investment Manager, the
Trustee shall be fully protected in relying upon the
instructions received from such Investment Manager with
respect to the portions of the Fund for which such
Manager has investment responsibilities.
8.11. DUTIES OF THE ADVISORY COMMITTEE.
The Advisory Committee shall be responsible for and
have discretionary authority with respect to
interpretation of the provisions of the Plan, the
determination of benefits and the right of any person
to benefits, and such other functions including without
limitation the promulgation of rules and regulations as
may be necessary for proper administration of the Plan
and not hereunder delegated to the Trustee, Investment
Manager or other Fiduciary appointed by the Board of
Directors. The Advisory Committee's rules,
interpretations, computations and actions with be
conclusive and binding on all persons.
<PAGE>
8.11. DUTIES OF THE ADVISORY COMMITTEE continued:
Individual members of the Advisory Committee may
exercise jurisdiction and take actions with respect to
administration of the Plan provided such actions are
consistent with the proposes of and authorized by the
Plan.
8.12. NOTICE OF PAYMENTS DUE.
The Advisory Committee shall notify the Trustees in
writing of the amounts payable under the Plan and the
date of such payments.
8.13. RECORDS AND REPORTS.
The Advisory Committee shall maintain or shall direct
the Trustees to maintain accounts showing the fiscal
transactions of the Plan and shall keep or direct the
Trustees to keep in convenient form such data as may be
necessary for the valuation of the assets and
liabilities, contingent or otherwise, of the Plan. The
Committee shall exercise such authority as it deems
appropriate in order to comply with the reporting
requirements of any applicable law or regulation
affecting the Plan and shall prepare annually a report
showing in reasonable detail such assets and
liabilities of the Plan and any other information which
the Board of Directors may require and which the
Committee can reasonably furnish or obtain from the
Trustees. Such report shall be submitted to the Board
of Directors.
<PAGE>
8.14. EXONERATION OF ADVISORY COMMITTEE.
The members of the Advisory Committee, Employers and
their officers, directors and Employees shall be
entitled to rely upon the reports furnished by any
Trustee or by any accountant retained by the Committee
or the Board of Directors, and upon all opinions given
by any legal counsel selected or retained by the
Committee or the Board of Directors. Except as
contrary to law, the members of the Committee,
Employers and their officers, directors and Employees
shall be fully protected and exonerated from liability
with respect to any action taken or suffered by them in
good faith in reliance upon such reports, opinions or
other advice received from any such Trustee, accountant
or legal counsel.
The fact that any member of the Committee is a
director, officer or shareholder of the Employer, or a
Member of the Plan, shall not disqualify his from
performing any duties which the Plan or the Trust
Agreements authorize or require him to do as a member
of the Committee or render him accountable for any
benefits received by him under the Plan. All
directors, officers and Employees who are deemed to be
Fiduciaries of this Plan are entitled to
indemnification to the full extent provided for by law
and by the Articles of Incorporation and Bylaws of Cone
in effect on January 1, 1987, or as, thereafter
amended.
<PAGE>
8.15. ERRORS AND OMISSIONS.
Individuals and entities charged with the
administration of the Plan must see that it is
administered in accordance with its terms as long as it
is not in conflict with the Code or ERISA. If an
innocent error or omission is discovered in the Plan's
operation or administration, and if the Advisory
Committee determines that it would cost more to correct
the error than is warranted, and if the Advisory
Committee determines that the error did not result in
discrimination prohibited by Plan Section 11.06 or
cause a qualification or excise tax problem, then, to
the extent that an adjustment will not in the Advisory
Committee's judgment result in discrimination
prohibited by Plan Section 11.06, the Advisory
Committee may authorize any equitable adjustment it
deems necessary or desirable to correct the error or
omission, including but not limited to the
authorization of additional Cone Contributions
designed, in a manner consistent with the goodwill
intended to be engendered by the Plan, to put Members
in the same relative position they would have enjoyed
if there had been no error or omission. Any
contribution made pursuant to this section is an
additional discretionary contribution.
<PAGE>
8.16. FEES AND EXPENSES.
Any fees or expenses incurred in connection with the
operation of the Plan shall be paid out of the SRP or
EEP Trust Fund, unless paid by Cone in its discretion.
8.17. VOTING AND TENDERING OF SHARES.
(a) Qualifying Employer Securities held in the Trust
Fund established under the EEP shall be voted by
the Trustee according to the written instructions
of the Member whose Accounts hold the shares.
Without limiting the generality of the foregoing
and notwithstanding any other provision of this
Plan or the Trust Agreement established under the
EEP, a Member shall be entitled to direct the
Trustee as to the manner in which voting rights
will be exercised with respect to any corporate
matter which involves the voting of Qualifying
Employer Securities allocated to his Accounts.
Shares unallocated as of any voting record date or
shares as to which the Trustee receives no written
instructions shall be voted by the Trustee.
(b) Options and other rights (for example, tender
rights) inuring to the benefit of Qualifying
Employer Securities allocated to a Member's
Account may be exercised by the Trustee only
according to the written instruction of the Member
whose Account holds the shares. Options and
similar rights (for
<PAGE>
8.17. VOTING AND TENDERING OF SHARES continued:
example, tender rights) inuring to the benefit of
unallocated shares must be exercised by the
Trustee according to the same principles set forth
in this Section with regard to voting rights.
Members directions pursuant to this Section may be
itemized or a general (blanket) authorization.
(c) The Advisory Committee shall take such action as
may be necessary to ensure that Members of the EEP
receive the same notices, financial statements,
proxies, proxy solicitation materials and other
information as Cone sends to its shareholders
generally.
8.18 CERTIFICATION OF DIRECTIONS FROM MEMBERS.
Any Member's rights contained in this Plan or in the
Trust Agreements to direct any action may be exercised
only by directions communicated to the Advisory
Committee. The Advisory Committee must communicate
those directions to the Trustee or other appropriate
persons. Any Member's directions communicated by the
Advisory Committee are deemed to be true and accurate,
and each recipient of directions shall be entitled to
rely conclusively upon the directions.
<PAGE>
ARTICLE IX
AMENDMENT, TERMINATION AND MERGER
9.01. AMENDMENT.
(a) The Board of Directors retains the right at any
time;
(1) to amend this Plan (or either component
hereof) and any Trust Agreement to qualify or
retain qualification of this Plan and the
Trust under the applicable provisions of the
Code or under any other laws;
(2) to amend this Plan (or either component
hereof) and any Trust Agreement in any other
manner; and
(3) to amend this Plan (or either component
hereof) and liquidate any Trust Fund by
transferring all assets to a new trust
qualified under the Code.
(b) No amendment to the Plan or any Trust Agreement
and no transfer of liabilities or assets of any
Trust Fund shall permit any part of the Trust Fund
to be used for or diverted to purposes other that
for the exclusive benefit of Members and
Beneficiaries and for defraying reasonable
expenses of administering the Plan. An amendment
may not cause any reduction in benefits accrued by
any Member or cause or permit any portion of the
Trust Fund to revert to
<PAGE>
9.01. AMENDMENT continued:
or become the property of an Employer. An
amendment that affects the rights, duties or
responsibilities of any Fiduciary may not be made
without that Fiduciary's written consent. Except
as permitted by Treasury regulation, no Plan
amendment or transaction having the effect of a
Plan amendment (such as a merger, plan transfer or
similar transaction) shall be effective to the
extent it eliminates or reduces any "Section
411(d)(6) protected benefit" or adds or modifies
conditions relating to "Section 411(d)(6)
protected benefits" the result of which is a
further restriction on such benefit unless such
protected benefits are preserved with respect to
benefits accrued as of the later of the adoption
date or effective date of the amendment. "Section
411(d)(6) protected benefits" are benefits
described in Code Section 411(d)(6)(A), early
retirement benefits and retirement-type subsidies,
and optional forms of benefit. An amendment is
effective on the date indicated in any written
instrument that is identified as an amendment to
the SRP or the EPP, that is approved or authorized
by the Board of Directors of Cone Mills
Corporation and that is signed by an officer of
the Corporation.
<PAGE>
9.01. AMENDMENT continued:
(c) As allowed by law, a transfer of labilities or
Trust Fund assets or any amendment to the Plan or
a Trust Agreement may authorize or permit part of
the Trust Fund to be used for or diverted to
payment of taxes owed or to payment of reasonable
administrative expenses. To the extent allowed by
Code Section 401(a), Trust Fund assets may be used
for or diverted to purposes that benefit Employees
other than Members or their Beneficiaries or
estates.
9.02. TERMINATION.
(a) The Board of Directors has the right at any time
to terminate this Plan (or either Component
hereof) and any Trust Agreement. Notice of a
termination must be given to the Members, the
Advisory Committee, the affected Trustees or Co-
Trustees and all necessary authorities. If any
authority's approval is necessary, termination is
effective according to that approval; otherwise,
the date of the notice or a later date contained
in the notice is the termination date for purposes
of this Plan.
(b) If the Plan (or either component hereof)
terminates, all Accounts are then nonforfeitable
(100% vested).
<PAGE>
9.02. TERMINATION continued:
If the Plan (or either component hereof) partially
terminates (determined in a manner consistent with
legal authorities), all Accounts of affected
Members are fully nonforfeitable and may then be
treated by the Advisory Committee as if the Plan
had terminated.
(c) On the Plan's (or either component hereof)
termination, the Advisory Committee must direct
the Trustee to allocate the assets of the affected
Trust Fund among the Members and Beneficiaries
according to the rules contained in Article IV.
Members have no recourse toward satisfaction of
their SRP Accounts other than from the SRP Trust
Fund and no recourse toward satisfaction of their
EEP Accounts other than from the EEP Trust Fund.
(d) After providing for payment of any expenses
properly chargeable against the affected Trust
Fund and compliance with all other requirements of
law, the Advisory Committee may direct the
Trustees and Co-Trustees to distribute assets
remaining in the Trust Fund. Distributions
according to this Section 9.02. are not subject to
the regular distribution provisions of this Plan,
but must be in the manner the Advisory Committee
determines consistent with statutory requirements
and purposes
<PAGE>
9.02. TERMINATION continued:
of the Plan. Except as specifically provided by
law, the Advisory Committee's determination is
conclusive.
(e) Each Trustee and Co-Trustee must transfer or
deliver property to Members according to the
Advisory Committee's directions. A Trustee or Co-
Trustee will have not further right, title or
interest in property distributed. After all
distributions, each Trustee and Co-Trustee is
discharged from all obligations under the Trust
Agreements. Except by statute, no Member or
Beneficiary has any further right or claim.
9.03. DISCONTINUANCE OF CONTRIBUTIONS.
(a) Each Employer has the right at any time to reduce
or discontinue its contributions to this Plan (or
either component hereof). If there is a complete
discontinuance of contributions from all
Employers, all Accounts become fully non-
forfeitable.
(b) A discontinuance of Employer contributions is not
a termination of the Plan unless Cone gives the
notice described in Plan Section 9.02(a).
9.04. PLAN MERGER OR ASSET TRANSFER.
(a) The merger or consolidation of this Plan with, or
the transfer of assets or liabilities of this Plan
(or either component hereof) to another employee
<PAGE>
9.04. PLAN MERGER OR ASSET TRANSFER continued:
benefit plan or the transfer of assets or
liabilities of another plan to this Plan is
allowed provided each Member's benefit entitlement
immediately after the merger, consolidation, or
transfer, is (when computed as if the surviving or
receiving plan had immediately terminated) equal
to or greater than the benefit to which the Member
would have been entitled if this Plan had
terminated immediately before the merger,
consolidation, or transfer.
(b) Subject to subsection (a), on written direction
from Cone, the Advisory Committee and any Trustee
or Co-Trustee so directed must take all
necessarysteps to transfer assets held in any
Trust Fund, in whole or in part, to another
qualified plan.
9.05. CONTINUATION OF THE PLAN.
If an Employer is merged or consolidated with any other
business or is succeeded by a corporation or any other
legal entity that acquires substantially all of the
Employer's assets, the surviving or purchasing
corporation or legal entity, subject to approval of the
Board of Directors, may elect to continue this Plan (or
either component hereof) as to that Employer's Members
but shall not be required to do so.
<PAGE>
ARTICLE X
MULTIPLE COMPANIES INCLUDED
10.01. PLAN SPONSOR AND OTHER EMPLOYERS.
(a) This Plan's sponsor is Cone Mills Corporation, or
its successor.
(b) This Plan is designed to allow the sponsor's
Affiliates to participate. Employers are Cone
Mills Corporation and any Affiliate that was
participating in this Plan before the effective
Date of this amendment and restatement and
Affiliates that are permitted to adopt this Plan
in accordance with Section 10.02.
10.02. METHOD OF PARTICIPATION.
With approval of the Board of Directors, any other
business that is an Affiliate of Cone may take
appropriate action through its board and become a party
to the Plan (or either component hereof) as an
Employer. To become an Employer, a business must adopt
this Plan (or either component hereof) as a Qualified
Plan for its employees. A Business that becomes an
Employer must promptly deliver to the Trustee or Co-
Trustees designated by Cone a copy of the resolutions
or other documents evidencing its adoption of the Plan
(or either component hereof) and also a written
instrument showing Cone's Board's approval of the
adopting entity's status as a party to the Plan and an
Employer.
<PAGE>
10.03 WITHDRAWAL BY EMPLOYER.
(a) An employer may withdraw from the Plan (or either
component hereof) at any time by giving the
Advisory Committee and the Board of Directors six
months advance notice in writing of its intention
to withdraw unless a shorter notice is agreed to
by the Board of Directors.
(b) Upon receipt of an Employer's notice of
withdrawal, the Advisory Committee must certify to
the appropriate Trustees or Co-Trustees the
withdrawing Employer's equitable share in the
Trust Fund. The Advisory Committee may rely
conclusively on the determination made by counsel
and advisors then employed on behalf of the Plan.
The Trustees or Co-Trustees must then set aside
from the Trust Fund such securities and other
property as each deems, in its sole discretion, to
be equal in value to that amount directed by the
Advisory Committee. If the Plan (or either
component hereof) is to be terminated with respect
to the Employer, then the amount set aside must be
dealt with according to the provisions of Plan
Article IX. If the Plan (or either component
hereof) is not to be terminated with respect to
the Employer, the Trustee or Co-Trustees must
either transfer the assets set aside to another
trust governed by an agreement between a
<PAGE>
10.03. WITHDRAWAL BY EMPLOYER continued:
Trustee or Co-Trustees and the withdrawing
Employer or to a successor trustee, according to
the Advisory Committee's directions.
(c) The segregation of the Trust Fund Assets upon an
Employer's withdrawal, or the execution of a new
agreement and declaration of trust pursuant to any
of the provisions of this section, must not
operate to permit any part of the Trust Fund's
principal or income to be used for or diverted to
purposes other than for the benefit of Members and
Beneficiaries or for the payment of reasonable
expenses of administering the Plan.
10.04. TAX YEAR.
Although the Employers may have different tax years,
the Plan Year which is the calendar year, is the tax
year for this Plan and any Trust Fund.
<PAGE>
ARTICLE XI
GENERAL
11.01. PLAN CREATES NO SEPARATE RIGHTS.
The establishment and existence of the Plan, Trust
Agreements and Trust Fund does not give a person any
legal or equitable right against:
(a) an Employer;
(b) any officer, director, Employee or other agent of
an Employer;
(c) any Trustee or any Co-Trustee;
(d) the Advisory Committee or any member of the
Advisory Committee.
The Plan and Trust Agreements create no employment
rights and do not modify the terms of an Employee's or
a Member's employment. The Plan and Trust Agreements
are not contracts between an Employer and any Employee,
and the Plan is not an inducement for anyone's
employment.
11.02. DELEGATION OF AUTHORITY.
Cone's acts may be accomplished by any person with
authorization from the Board of Directors. Any other
Employer's acts may be accomplished by an person with
authorization from that Employer's board.
11.03. LIMITATION OF LIABILITY.
(a) A Fiduciary is not subject to suit or liability in
connection with this Plan or the Trust Agreement
or their operation, except according to this
<PAGE>
11.03. LIMITATION OF LIABILITY continued:
Section 11.03.
(b) Each member of the Advisory Committee, each
Trustee and Co-Trustee and any person employed by
an Employer is liable only for that person's own
acts or omissions.
(c) Each member of the Advisory Committee, each
Trustee and Co-Trustee, or any person employed by
an Employer is not liable for the acts or
omissions of another without knowing participation
in the acts or omissions, except by action to
conceal an action or omission of another while
knowing the act or omission is a breach, or by a
failure to properly perform duties that enables
the breach to occur, or with knowledge of the
breach, failure to make reasonable efforts to
remedy the breach.
(d) One Trustee or Co-Trustee must use reasonable care
to prevent another from committing a breach; but
all Trustees and Co-Trustees need not jointly
manage or control the assets, because specific
duties have been allocated among them in this Plan
or the Trust Agreements. A Trustee or Co-Trustee
is not liable for actions or omissions when
following the specific directions of the Advisory
Committee or a duly authorized and appointed
Investment Manager unless such directions are
<PAGE>
11.03. LIMITATION OF LIABILITY continued:
improper on their face. If an Investment Manager
has been properly appointed, subject to subsection
(c), a Trustee or Co-Trustee is not liable for the
acts of the Investment Manager and does not have
any investment responsibility for assets under the
management of the Investment Manager.
(e) A Fiduciary is not liable for the actions of
another to whom responsibility has been allocated
or delegated according to this Plan and the Trust
Agreements, unless as the allocating or delegating
Fiduciary it was imprudent in making the
allocation or delegation or in continuing the
allocation or delegation.
(f) Each Employee releases all members of the
Investment Committee and the Advisory Committee,
each Trustee and Co-Trustee, each Employer, all
officers and agents of each Employer, and all
agents of Fiduciaries from any and all liability
or obligation, to the extent release is consistent
with the provisions of this Section.
11.04. LEGAL ACTION.
Except as explicitly permitted by statute, in any
action or proceeding involving the Plan, a Trust
Agreement, a Trust Fund, any property held as part of a
Trust Fund, or the administration of the Plan or Trust
Fund, the
<PAGE>
11.04. LEGAL ACTION continued:
Advisory Committee, the appropriate Trustee or Co-
Trustees and Cone are the only necessary parties. No
Employees or former Employees or their Beneficiaries or
any person having or claiming to have an interest in
any Trust Fund, or under the Plan is entitled to notice
of process. Any final judgment that is not appealed or
appealable that may be entered in an action or
proceeding is binding and conclusive on the parties to
this Plan and all persons having or claiming to have
any interest in any Trust Fund or under the Plan.
11.05. BENEFITS SUPPORTED ONLY BY TRUST.
Except as otherwise provided by statute, a person
having any claim under the Plan must look solely to the
assets of the Trust Fund for satisfaction.
11.06. DISCRIMINATION.
The Advisory Committee must administer the Plan in a
uniform and consistent manner for all Members and may
not permit discrimination in favor of Highly
Compensated Employees.
11.07. MODEL AMENDMENT IV.
The following sections of Model Amendment IV (IRS
Notice 87-2) are hereby incorporated in the
Supplemental Retirement Plan of Cone Mills Corporation
for the Plan Years beginning January 1, 1987 and
January 1, 1988: I, II, III, IV, V, VI, VIII, IX, X, XI
AND XII.
<PAGE>
11.08. ENTIRE PLAN.
This document incorporates in their entirety
the Plan, the SRP and the EEP and supersedes
and replaces all prior plan documents. It
may not be amended, modified or supplemented
except by a written instrument that is
identified as an amendment to the Plan, the
SRP or the EEP, that is approved or
authorized by the Board of Directors of Cone
Mills Corporation and that is signed by an
officer of the Corporation.
<PAGE>
SIGNATURE PAGE
As evidence of the adoption of the Plan, as amended and restated,
for itself and by all Affiliated Companies, Cone Mills
Corporation has caused this document to be signed by its duly
authorized officer on December 15, 1993.
Cone Mills Corporation
By:
Lacy G. Baynes
Title: Vice President
<PAGE>
EXHIBIT 5
<PAGE>
January 18, 1994
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D. C. 20549
Re: Cone Mills Corporation
Registration Statement on Form S-8
Gentlemen:
I am General Counsel of Cone Mills Corporation, a North
Carolina corporation (the "Company"), and have represented the
Company in connection with the registration under the Securities
Act of 1933, as amended (the "1933 Act"), of (i) 250,000 shares of
Common Stock, par value $.10 per share, of the Company issuable
pursuant to the Company's Employee Equity Plan - Hourly (the
"Plan") and (ii) an indeterminate amount of interests to be
offered or sold pursuant to the Plan.
I have examined the Company's Restated Charter and all
amendments thereto, its Bylaws as amended and such of its
corporate records as I deemed necessary for purposes of rendering
this opinion, the Plan and related documents, the Registration
Statement on Form S-8 relating to the foregoing registration
("Registration Statement") and filed with the Securities and
Exchange Commission and the form of certificate of Common Stock.
Based on such review, I am of the following opinions:
1. The establishment of the Plan and the interests in the
Plan have been duly authorized by all necessary
corporate action on the part of the Company, and the
interests in the Plan will be valid and subsisting
under the Plan and fully paid and nonassessable.
2. All necessary corporate actin has been taken to
authorize the sale and issuance of the shares of Common
Stock to be sold by the Company and such shares, when
and if issued and paid for as contemplated by the Plan,
will be validly issued, fully paid and nonassessable.
<PAGE>
Securities and Exchange Commission
January 18, 1994
Page 2
I hereby consent to the use of this opinion as Exhibit 5 of
the Registration Statement and to the reference to my name under
the caption "Interest of Named Experts and Counsel" therein. I
do not, however, thereby admit that I am within the category of
persons whose consent is required under Section 7 of the 1933 Act
or the rules and regulations of the Securities and Exchange
Commission promulgated thereunder.
Very truly yours,
CONE MILLS CORPORATION
Neil W. Koonce
General Counsel
NWK/eg
<PAGE>
EXHIBIT 23.2
<PAGE>
CONSENT OF
ROBINSON, BRADSHAW & HINSON, P.A.
We hereby consent to the incorporation by reference into
this Registration Statement on Form S-8 of the references to our
firm and opinion with respect to the litigation between Elmore et
al. and Cone Mills Corporation (the "Company") et al. in the
following:
(1) the Annual Report on Form 10-K of Cone Mills
Corporation for the fiscal year ending January 3, 1993
(dated March 25, 1993), as amended by Form 8,
Amendment No. 1 (dated April 30, 1993);
(2) the Quarterly Report on Form 10-Q of Cone Mills
Corporation for the quarter ended April 4, 1993 (dated
May 11, 1993); and
(3) the Quarterly Report on Form 10-Q of Cone Mills
Corporation for the quarter ended July 4, 1993 (dated
August 16, 1993).
This consent is limited to the foregoing reports in each
case as of the date thereof, and shall not be deemed in any way
to constitute an update or restatement of our legal opinion
referred to therein.
ROBINSON, BRADSHAW & HINSON, P.A.
Charlotte, North Carolina
January 12, 1994
<PAGE>
EXHIBIT 23.3
<PAGE>
CONSENT OF INDEPENDENT AUDITOR
We hereby consent to the incorporation by reference into
this Registration Statement on Form S-8 our report, date February
19, 1993, which appears on page 27 of the Annual Report on Form
10-K of Cone Mills Corporation for the fiscal year ended January
3, 1993.
McGLADREY & PULLEN
Greensboro, North Carolina
January 18, 1994
<PAGE>
