<PAGE> 1
Signed Copy (with Exhibits)
Registration No. 33-______
As filed with the Securities and Exchange Commission on __________, 1996
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT
UNDER THE SECURITIES ACT OF 1933
COMERICA INCORPORATED
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
Delaware 38-1998421
(State of Incorporation) (I.R.S. Employer Identification No.)
</TABLE>
One Detroit Center
500 Woodward Avenue, 31st Floor,
Detroit, Michigan 48226
(313) 222-3300
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
METROBANK EMPLOYEE SAVINGS PLAN
(Full title of the Plan)
Judith C. Lalka Dart
Executive Vice President, General Counsel and Secretary
Comerica Incorporated
One Detroit Center
500 Woodward Avenue, 33rd Floor
Detroit, Michigan 48226
(313) 222-3300
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
CALCULATION OF REGISTRATION FEE
- --------------------------------------------------------------------------------
<TABLE>
Title of securities Amount to be Proposed maximum offering Proposed maximum aggregate Amount of
to be registered registered(1) price per share(2) offering price(2) registration fee
- ------------------- ------------- --------------------------- ---------------------- ---------------------
<S> <C> <C> <C> <C>
Common Stock 10,000 shares $40.6875 $406,875 $ 140.31
$5.00 par value
Plan interests (3) None(3) None(3) 0
Rights (4) None(5) None(5) 0
</TABLE>
- ---------------
(1) Pursuant to Rule 416(a), this Registration Statement shall also be
deemed to cover any additional securities to be offered or issued in connection
with terms of the above-referenced Plan which provide for changes in the amount
of securities to be offered or issued to prevent dilution resulting from stock
splits, stock dividends or similar transactions.
(2) Pursuant to Rule 457(c), the offering price is based on the average
high and low prices of the common stock as reported on the New York Stock
Exchange Composite Tape on February 7, 1996 ($40.6875 per share).
(3) Pursuant to Rule 416(c), to the extent that interests in the
above-referenced Plan constitute separate securities required to be registered,
this Registration Statement registers an indeterminate amount of such Plan
interests.
(4) The Rights are not presently separable from the shares of Common Stock
or exercisable. The number of Rights per share of Comerica Stock is subject to
adjustment in the event of stock splits, stock-on-stock dividends or similar
events. Currently, each share of Common Stock carries 2/9 of one Right.
(5) No separate consideration will be received for the Rights.
<PAGE> 2
EXPLANATORY NOTE
Effective January 16, 1996, registrant acquired Metrobank, a California
state chartered bank ("Metrobank"). Metrobank sponsors the plan referenced on
the cover page of this Registration Statement (the "Metrobank Plan").
Registrant intends to continue the Metrobank Plan for a temporary period and to
offer registrant's common stock, $5.00 par value, as an investment option under
the Metrobank Plan. The registrant is filing this Registration Statement with
respect to registrant's common stock to be issued under the Metrobank Plan.
1
<PAGE> 3
PART II
INFORMATION NOT REQUIRED IN REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, heretofore filed by Comerica Incorporated
("Comerica") with the Securities and Exchange Commission (the "Commission"),
are incorporated in this Registration Statement by reference:
1. Annual Report on Form 10-K for the year ended December 31,
1994.
2. All other reports filed pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (the "Exchange Act") since
December 31, 1994.
3. The description of Comerica's common stock, par value $5.00 per
share, contained in the Amendment No. 1 to Registration Statement on
Form S-4 filed August 16, 1995 (Commission File Number 33-61487).
The Annual Report on Form 11-K of the Metrobank Plan for the year ended
December 31, 1994, heretofore filed by the Metrobank Plan with the Securities
and Exchange Commission, also is incorporated in this Registration Statement by
reference.
All documents filed with the Commission by Comerica or the Metrobank Plan
pursuant to Sections 13(a), 13(c), 14, or 15(d) of the Exchange Act subsequent
to the date of this Registration Statement and prior to the filing of a
post-effective amendment hereto which indicates that all securities offered
have been sold or which deregisters all securities then remaining unsold shall
be deemed to be incorporated by reference in this Registration Statement and to
be a part thereof from the date of filing of such
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<PAGE> 4
documents. Any statement contained in a document all or a portion of which is
incorporated or deemed to be incorporated by reference herein shall be deemed
to be modified or superseded for purposes of this Registration Statement to the
extent that a statement contained herein or in any other subsequently filed
document which also is or is deemed to be incorporated by reference herein
modifies or supersedes such statement. Any statement so modified or superseded
shall not be deemed, except as so modified or superseded, to constitute a part
of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The General Corporation Law ("GCL") of the State of Delaware provides that
a Delaware corporation, such as Comerica, may indemnify a director or officer
against his or her expenses and judgments, fines and amounts paid in settlement
actually and reasonably incurred in connection with any action, suit or
proceeding (other than an action by or in the right of the corporation)
involving such person by reason of the fact that such person is or was a
director or officer, concerning actions taken in good faith and in a manner
reasonably believed to be in or not opposed to the best interest of the
corporation and, with respect to any criminal action or proceeding, without
reasonable cause to believe his or her conduct was unlawful. The GCL also
provides that in a derivative action, a Delaware corporation may indemnify its
directors and officers against expenses actually and reasonably incurred to the
extent that such director or officer acted in good
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<PAGE> 5
faith and in a manner such director or officer reasonably believed to be in or
not opposed to the best interests of the corporation, except that no
indemnification may be made with respect to any claim, issue or matter as to
which such director or officer is adjudged to be liable to the corporation
unless and only to the extent that the court determines upon application that,
despite the adjudication of liability but in view of all the circumstances of
the case, such director or officer is fairly and reasonably entitled to
indemnity for such expenses as the court deems proper. The GCL also generally
permits the advancement of a director's or officer's expenses, including by
means of a mandatory charter or bylaw provision to that effect, in lieu of
requiring the authorization of such advancement by the Board of Directors in
specific cases. Section 12 of Article V of Comerica's bylaws implements such
provisions and provides as follows:
INDEMNIFICATION AND INSURANCE
(a) The Corporation shall indemnify any person who was or is
a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action
by or in the right of the Corporation) by reason of the fact that
he or she is or was a director, officer or employee of the
Corporation or 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 expenses (including attorneys' fees),
judgments, fines, and amounts paid in settlement actually and
reasonably incurred by him or her in connection with such action,
suit, or proceeding if he
II-3
<PAGE> 6
or she acted in good faith and in a manner he or she reasonably
believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or
proceeding, had no reasonable cause to believe his or her conduct
was unlawful. Any person who is or was an agent of the
Corporation may be indemnified to the same extent as hereinabove
provided. In addition, in the event any such action, suit or
proceeding is threatened or instituted against a spouse to whom a
director or officer is legally married at the time such director
or officer is covered under the indemnification provided herein,
which action, suit or proceeding arises solely out of his or her
status as the spouse of a director or officer, including, without
limitation, an action, suit or proceeding that seeks damages
recoverable from marital community property of the director or
officer and his or her spouse, property owned jointly by them or
property purported to have been transferred from the director or
officer to his or her spouse, the spouse of the director or
officer shall be indemnified to the same extent as hereinabove
provided. The termination of any action, suit, or proceeding by
judgment, order, settlement, conviction or upon a plea of 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 or she reasonably believed to be in or not
opposed to the best interests of the Corporation, and, with
respect to any criminal action or proceeding, raise any inference
that he or she had reasonable cause to believe that his or her
conduct was unlawful.
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<PAGE> 7
(b) The Corporation shall indemnify any person who was or is a
party or is threatened to be made a party to any threatened,
pending, or completed action or suit by or in the right of the
Corporation to procure a judgment in its favor by reason of the
fact that he or she is or was a director, officer or employee of
the Corporation, or 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 expenses (including attorneys' fees) actually
and reasonably incurred by such person in connection with the
defense or settlement of such action or suit if he or she acted
in good faith and in a manner he or she reasonably believed to be
in or not opposed to the best interests of the Corporation, and
except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been
adjudged to be liable to the Corporation unless and only to the
extent that the court in which such action or suit was brought
shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case,
such person is fairly and reasonably entitled to indemnity for
such expenses which the court shall deem proper. Any person who
is or was an agent of the Corporation may be indemnified to the
same extent as hereinabove provided. In addition, in the event
any such action or suit is threatened or instituted against a
spouse to whom a director or officer is legally married at the
time such director or officer is covered under the
indemnification provided herein which action or suit arises
solely out of his or her status as the spouse of a
II-5
<PAGE> 8
director or officer, including, without limitation, an action or
suit that seeks damages recoverable from marital community
property of the director or officer and his or her spouse,
property owned jointly by them or property purported to have been
transferred from the director or officer to his or her spouse,
the spouse of the director or officer shall be indemnified to the
same extent as hereinabove provided.
(c) To the extent that a director, officer, spouse of the
director or officer, employee, or agent of the Corporation has
been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) and (b)
of this Section, or in defense of any claim, issue or matter
therein, such person shall be indemnified against expenses
(including attorneys' fees) actually and reasonably incurred by
such person in connection therewith.
(d) Any indemnification under subsections (a) and (b) of
this Section (unless ordered by a court) shall be made by the
Corporation only as authorized in the specific case upon a
determination that indemnification of the director, officer,
spouse of the director or officer, employee, or agent is proper
in the circumstances because such person has met the applicable
standard of conduct set forth in subsections (a) and (b) of this
Section. Such determination shall be made (1) by the Board of
Directors by a majority vote of a quorum consisting of Directors
who were not parties to the action, suit or proceeding, or (2) if
such a quorum is not obtainable, or even if obtainable a quorum
of disinterested Directors so directs, by independent legal
counsel chosen by the entire Board of Directors, subject to the
reasonable satisfaction of
II-6
<PAGE> 9
the party seeking indemnification, in a written opinion, or (3)
by the shareholders.
(e) Expenses (including attorney's fees) incurred by an
officer, director, or spouse of an officer or director, in
defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the Corporation in
advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of the
director, officer or spouse to repay such amount if it shall
ultimately be determined that he or she is not entitled to be
indemnified by the Corporation as authorized in this Section.
Such expenses (including attorney's fees) incurred by other
employees and agents may be so paid upon such terms and
conditions, if any, as the board of directors deems appropriate.
(f) The indemnification and advancement of expenses provided
by, or granted pursuant to, the other subsections of this Section
shall not be deemed exclusive of any other rights to which those
seeking indemnification or advancement of expenses may be
entitled under any bylaw, agreement, vote of shareholders or
disinterested directors or otherwise, both as to action in his or
her official capacity and as to action in another capacity while
holding such office.
(g) The Corporation may purchase and maintain insurance on
behalf of any person who is or was a director, officer, spouse of
a director or officer, employee or agent of the Corporation, or
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
II-7
<PAGE> 10
other enterprise against any liability asserted against such
person and incurred by such person in any such capacity, or
arising out of his or her status as such, whether or not the
Corporation would have the power to indemnify such person against
such liability under the provisions of this Section.
(h) For the purposes of this Section, references to "the
Corporation" include, in addition to the resulting or surviving
corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or
merger which, if its separate existence had continued, would have
had the power and authority to indemnify its directors, officers,
spouses of directors or officers, and employees or agents, so
that any person who is or was a director, officer, spouse of a
director or officer, employee or agent of such constituent
corporation, or is or was serving at the request of such
constituent corporation as a director, officer, employee, or
agent of another corporation, partnership, joint venture, trust
or other enterprise, shall stand in the same position under the
provisions of this Section with respect to the resulting or
surviving corporation as he or she would have with respect to
such constituent corporation if its separate existence had
continued.
(i) For purposes of this Section, references to "other
enterprises" shall include employee benefit plans; references to
"fines" shall include any excise taxes assessed on a persons with
respect to an employee benefit plan; and references to "serving
at the request of the Corporation" shall include any service as a
director, officer, employee or agent of the Corporation which
imposes duties on, or involves
II-8
<PAGE> 11
services by, such director, officer, employee, or agent with
respect to an employee benefit plan, its participants, or
beneficiaries; and a person who acted in good faith and in a
manner he or she reasonably believed to be in the interest of the
participants and beneficiaries of an employee benefit plan shall
be deemed to have acted in a manner "not opposed to the best
interests of the Corporation" as referred to in this Section.
(j) The indemnification and advancement of expenses provided
by, or granted pursuant to, this Section shall, unless otherwise
provided when authorized or ratified, continue as to a person who
has ceased to be a director, officer, employee or agent, and with
respect to any spouse of a director or officer, shall continue
following the time the director or officer spouse ceases to be a
director or officer even if the marriage of the individuals
terminates prior to the end of the period of coverage, and shall
inure to the benefit of the heirs, executors and administrators
of such a person.
On July 21, 1995, the Corporation amended Section 8(d) of its bylaws to
provide that until June 18, 1998, there shall be an Indemnification Committee
consisting of all of the directors of the Corporation immediately prior to June
18, 1992. The Indemnification Committee is to make all determinations
necessary with respect to the Corporation's indemnification obligations
pursuant to the Corporation's bylaws prior to June 18, 1992.
Pursuant to an Agreement and Plan of Merger dated as of October 27, 1991,
between the Corporation and Manufacturers National Corporation, the Corporation
has agreed to indemnify each
II-9
<PAGE> 12
person who was an officer or director of Manufacturers National Corporation
against liabilities arising by reason of such person's status as a director or
officer of Manufacturers National Corporation prior to its merger with the
Corporation on June 18, 1992 to the extent Manufacturers National Corporation
would have been permitted to indemnify such person. Any former director or
officer of Manufacturers National Corporation who is now a director or officer
of the Corporation is entitled to this protection. Until June 18, 1998, a
committee composed of all individuals who were directors of Manufacturers
National Corporation on June 18, 1992 shall make all determinations required to
fulfill the Corporation's indemnification obligations under this paragraph.
Section 102(b)(7) of the GCL provides that a certificate of incorporation
may contain a provision eliminating or limiting the personal liability of a
director to the corporation or its stockholders for monetary damages for breach
of fiduciary duty as a director, provided that such provision may not eliminate
or limit the liability of a director (i) for any breach of the director's duty
of loyalty to the corporation or its stockholders; (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a knowing
violation of law; (iii) under Section 174 of the GCL (relating to liability for
unauthorized acquisitions or redemptions of, or dividends on, capital stock) or
(iv) for any transaction from which the director derived an improper personal
benefit. At the 1987 Annual Meeting of Comerica's shareholders, the
shareholders approved an amendment to Comerica's Restated Certificate of
Incorporation to include such a provision.
Comerica has entered into Indemnification Agreements (the "Agreements")
with each of its directors pursuant to which Comerica
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<PAGE> 13
agrees (i) to indemnify each such director to the fullest extent permitted by
any combination of (a) the benefits provided by the indemnification provisions
of Comerica's bylaws as in effect on the date of such Agreement, (b) the
benefits provided by the indemnification provisions of Comerica's bylaws in
effect at the time such indemnified costs are incurred by such director, (c)
the benefits allowable under the GCL in effect at the date of such Agreement or
as the same may be amended (but in the case of any such amendment, only to the
extent that such amendment permits Comerica to provide broader indemnification
than such law permits Comerica to provide prior to such amendment), (d) the
benefits allowable under the law of the jurisdiction under which Comerica is
organized at the time such indemnified costs are incurred by such director, (e)
the benefits available under any Directors' and Officers' Insurance or other
liability insurance obtained by Comerica, and (f) the benefits available to the
fullest extent authorized to be provided to such director by Comerica under the
non-exclusivity provisions of the bylaws of Comerica and the GCL, against
liability and expenses incurred by reason of such person serving as a director
or officer of Comerica or at Comerica's request as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or
other enterprise or with respect to employee benefit plans; (ii) to advance
certain expenses to such persons; and (iii) except under certain circumstances,
to purchase and maintain in effect one or more Directors' and Officers'
insurance policies.
No indemnification, reimbursement, or payments are required of Comerica
under the Agreements (except to the extent it is provided from policies of
insurance carried by Comerica): (1) with respect
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<PAGE> 14
to any claim as to which such director is finally adjudged by a court of
competent jurisdiction to (a) have acted in bad faith, (b) be liable for acts
or omissions which involve intentional misconduct, a knowing violation of law
or of such director's duty of loyalty to Comerica or its shareholders, (c) have
authorized a redemption or dividend on Comerica's stock which is prohibited by
Delaware law, or (d) have effected any transaction from which such director has
derived an improper personal benefit within the meaning of Section 102(b)(7) of
the GCL, except to the extent that such court, or another court having
jurisdiction, determines upon application that, despite the adjudication of
liability, but in view of all the circumstances of the case, such director is
fairly and reasonably entitled to indemnity for such indemnified costs as the
court deems proper; (2) with respect to any payment determined by final
judgment of a court, or other tribunal having jurisdiction over the question,
to be unlawful; and (3) with respect to any obligation of such director under
Section 16(b) of the Securities Exchange Act of 1934, as amended.
Insurance is maintained on a regular basis (and not specifically in
connection with this offering) against liabilities arising on the part of
directors and officers out of their performance in such capacities or arising
on the part of Comerica out of its foregoing indemnification provisions,
subject to certain exclusions and to the policy limits.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following documents are attached hereto or incorporated herein by
reference as exhibits to this Registration Statement:
II-12
<PAGE> 15
Exhibit
Number Description of Document
- ------- -----------------------
4.1 Restated Certificate of Incorporation of Comerica Incorporated, as
amended (incorporated herein by reference to Registrant's Annual Report
on Form 10-K for the year ended December 31, 1993 - Commission File
Number 0-7269).
4.2 Amended and restated bylaws of Comerica Incorporated (incorporated
herein by reference to Registrant's Annual Report on Form 10-K for the
year ended December 31, 1993 - Commission File Number 0-7269).
4.3 Rights Agreement between Comerica Incorporated and Comerica Bank
(incorporated herein by reference to Registrant's Annual Report on Form
10-K for the year ended December 31, 1987 - Commission File No.
0-7269).
4.4 First Amendment to the Rights Agreement between Comerica
Incorporated and Comerica Bank (incorporated herein by reference to
Exhibit 1.1 of Registrant's Form 8 filed November 1, 1991, Commission
File Number 0-7269).
4.5 Issuing and Paying Agency Agreement between Comerica Bank, as
Issuer and Comerica Bank, as Agent (incorporated herein by reference to
Registrant's Annual Report on Form 10-K for the year ended December 31,
1994, Commission File Number 0-7269).
4.6 Specimen of certificate for Registrant's common stock, $5.00 par
value (incorporated herein by reference to Exhibit 4(a) of Registrant's
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<PAGE> 16
Registration Statement on Form S-3 dated May 29, 1991, Commission File
Number 33-40921).
4.7 The Metrobank Plan, consisting of the Metrobank Employee Savings
Plan, restated effective January 1, 1989, First Amendment thereto and
Second Amendment thereto.
5.1 Opinion and Consent of John P. Sheridan as to the legality of the
securities being registered.
5.2 Copy of Internal Revenue Service determination letter dated
November 9, 1995 indicating that the Metrobank Plan is qualified under
Section 401 of the Internal Revenue Code.
15 N/A
23.1 Consent of Ernst & Young LLP, independent auditors.
23.2 Consent of John P. Sheridan, legal counsel (contained in Exhibit
5.1).
24 Powers of Attorney (contained in the signature pages of this
Registration Statement).
28 N/A
99 N/A
II-14
<PAGE> 17
ITEM 9. UNDERTAKINGS.
A. The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the Registration Statement
(or the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the Registration Statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
Registration Statement or any material change to such information
in the Registration Statement;
Provided, however, that paragraphs A(1)(i) and A(1)(ii) shall 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
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<PAGE> 18
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 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 this
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered herein, 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 provisions described in Item 6 above, or
otherwise, the Registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by
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<PAGE> 19
a director, officer or controlling person of the Registrant in the successful
defense of any action, suit or proceeding) is asserted by such director,
officer, or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
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<PAGE> 20
SIGNATURES
The Registrant. Pursuant to the requirements of the Securities Act of
1933, the Registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing of 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 Detroit, State of Michigan on January
18, 1996.
COMERICA INCORPORATED
By:/S/Eugene A. Miller
----------------------
Eugene A. Miller
Chairman and Chief
Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the dates indicated below. By so signing, each of the
undersigned, in his or her capacity as a director or officer, or both, as the
case may be, of the registrant, does hereby appoint Eugene A. Miller, John D.
Lewis, Arthur W. Hermann, and Judith C. Dart, and each of them severally, his
or her true and lawful attorney to execute in his or her name, place and stead,
in his or her capacity as a director or officer, or both, as the case may be,
of the registrant, any and all amendments to this Registration Statement and
post-effective amendments thereto and all instruments necessary or incidental
in connection therewith, and to file the same with the Securities and
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<PAGE> 21
Exchange Commission. Each of said attorneys shall have full power and authority
to do and perform in the name and on behalf of each of the undersigned, in any
and all capacities, every act whatsoever requisite or necessary to be done in
the premises as fully, and for all intents and purposes, as each of the
undersigned might or could do in person, the undersigned hereby ratifying and
approving the acts of said attorneys and each of them.
S-2
<PAGE> 22
[CAPTION]
<TABLE>
Signatures Title Date
---------- ----- ----
<S> <C> <C>
(1) Principal Executive Officer:
/S/ Eugene A. Miller Chairman and Chief January 18, 1996
- --------------------------------------- Executive Officer
Eugene A. Miller
(2) Principal Financial Officer:
/S/ Ralph W. Babb, Jr. Executive Vice President January 18, 1996
- --------------------------------------- and Chief Financial Officer
Ralph W. Babb, Jr.
(3) Principal Accounting Officer:
/S/ Arthur W. Hermann Senior Vice President January 18, 1996
- --------------------------------------- and Principal Accounting Officer
Arthur W. Hermann
(4) Directors:
/S/ E. Paul Casey Director January 18, 1996
- ---------------------------------------
E. Paul Casey
/S/ James F. Cordes Director January 18, 1996
- ---------------------------------------
James F. Cordes
/S/ J. Philip DiNapoli Director January 18, 1996
- ---------------------------------------
J. Philip DiNapoli
/S/ Max M. Fisher Director January 18, 1996
- ---------------------------------------
Max M. Fisher
/S/ John D. Lewis Director January 18, 1996
- ---------------------------------------
John D. Lewis
- --------------------------------------- Director
Patricia Shontz Longe, Ph.D.
/S/ Wayne B. Lyon Director January 18, 1996
- ---------------------------------------
Wayne B. Lyon
/S/ Gerald V. MacDonald Director January 18, 1996
- ---------------------------------------
Gerald V. MacDonald
/S/ Eugene A. Miller Director January 18, 1996
- ---------------------------------------
Eugene A. Miller
/S/ Michael T. Monahan Director January 18, 1996
- ---------------------------------------
Michael T. Monahan
/S/ Alfred A. Piergallini Director January 18, 1996
- ---------------------------------------
Alfred A. Piergallini
/S/ Alan E. Schwartz Director January 18, 1996
- ---------------------------------------
Alan E. Schwartz
/S/ Howard F. Sims Director January 18, 1996
- ---------------------------------------
Howard F. Sims
</TABLE>
S-3
<PAGE> 23
The Metrobank Plan. Pursuant to the requirements of the Securities Act of
1933, the trustee (or other persons who administer the employee benefit plan)
have caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Detroit, State of
Michigan, on January 18, 1996.
METROBANK EMPLOYEE
SAVINGS PLAN
/S/ John P. Sheridan
-------------------------------
By: John P. Sheridan
Vice President
Comerica Incorporated
S-4
<PAGE> 24
EXHIBIT INDEX
Page in
Sequentially
Exhibit Number Description of Document Numbered Copy
- -------------- ----------------------- -------------
4.7 The Metrobank Plan, consisting of the
Metrobank Employee Savings Plan, restated
effective January 1, 1989, First Amendment
thereto and Second Amendment thereto.
5.1 Opinion and consent of John P. Sheridan,
legal counsel
5.2 Copy of Internal Revenue Service
determination letter dated November 9, 1995
indicating that the Metrobank Plan is
qualified under Section 401 of the Internal
Revenue Code
23.1 Consent of Ernst & Young LLP
independent auditors
<PAGE> 1
EXHIBIT 4.7
METROBANK
EMPLOYEE SAVINGS PLAN
Restated Effective January 1, 1989
<PAGE> 2
METROBANK
EMPLOYEE SAVINGS PLAN
Statement of Purpose
Metrobank has established and intends to operate a 401(k)
Savings Plan, and related Trust, for the purpose of enabling Eligible Employees
of the Company and their Beneficiaries to provide retirement income. The Plan
is intended to qualify, and the Trust established pursuant to the related Trust
Agreement is intended to be exempt from federal income tax, under the pertinent
provisions of the Internal Revenue Code of 1986, as it may be amended, and any
successor federal income tax statute of the same or similar effect.
<PAGE> 3
CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C>
Statement of Purpose . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Account(s) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Affiliated Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Anniversary Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.4 Annual Addition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.5 Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.6 Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.7 Code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.8 Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.9 Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.10 Company Matching Contribution Account . . . . . . . . . . . . . . . . . . . . . 3
1.11 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.12 Disability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.13 Effective Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.14 Eligible Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.15 Employee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
1.16 Employment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.17 Entry Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.18 ERISA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.19 Forfeiture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.20 Highly Compensated Employee . . . . . . . . . . . . . . . . . . . . . . . . . . 5
1.21 Hour of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
1.22 Investment Fund or Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.23 Net Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.24 1-Year Break in Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.25 Participant . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
1.26 Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.27 Plan Year or Limitation Year . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.28 Post-Tax Contribution Account: . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.29 Post-Tax Contributions: . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.30 Pre-Tax Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.31 Pre-Tax Contribution Account . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.32 Retirement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
1.33 Rollover Contribution Account . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.34 Separation From Service Date . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.35 Special Company Contribution . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.36 Special Company Contribution Account . . . . . . . . . . . . . . . . . . . . . . 11
</TABLE>
i
<PAGE> 4
<TABLE>
<S> <C> <C>
1.37 Spousal Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
1.38 Top Paid Group . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.39 Trust . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.40 Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
1.41 Trust Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.42 Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.43 Valuation Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
1.44 Year of Service . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2 Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.1 Participation On The Effective Date . . . . . . . . . . . . . . . . . . . . . . 14
2.2 Subsequent Participation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.3 Loss Of Active Participant Status . . . . . . . . . . . . . . . . . . . . . . . 14
2.4 Rehire Of Former Participant . . . . . . . . . . . . . . . . . . . . . . . . . . 14
2.5 Elections Upon Commencement of Participation . . . . . . . . . . . . . . . . . . 15
SECTION 3 Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.1 Company Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.2 Timing of Company Contributions . . . . . . . . . . . . . . . . . . . . . . . . 16
3.3 Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
3.4 Timing Of Pre-Tax Contributions . . . . . . . . . . . . . . . . . . . . . . . . 17
3.5 Return Of Contributions To The Company . . . . . . . . . . . . . . . . . . . . . 17
3.6 Discrimination Test Requirements . . . . . . . . . . . . . . . . . . . . . . . . 18
3.7 Corrective Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
3.8 Rollovers From Other Qualified Plans . . . . . . . . . . . . . . . . . . . . . . 20
3.9 Allocation of Forfeitures . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
3.10 Post-Tax Contributions: . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 4 Retirement Dates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.1 Normal Retirement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
4.2 Disability Retirement Date . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 5 Participant's Credit In The Trust Fund . . . . . . . . . . . . . . . . . . . . . 23
5.1 Accounts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
5.2 Allocation Of Company Contributions . . . . . . . . . . . . . . . . . . . . . . 24
5.3 Maximum Annual Addition . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5.4 Investment Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
5.5 Allocation Of Trust Fund Earnings . . . . . . . . . . . . . . . . . . . . . . . 27
5.6 Accounting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
5.7 Valuation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
5.8 Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
5.9 Forfeiture Of Benefits Where Recipient Cannot Be Located . . . . . . . . . . . . 28
</TABLE>
ii
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<TABLE>
<S> <C>
SECTION 6 Participant's Right To Payment . . . . . . . . . . . . . . . . . . . . . . . . . 29
6.1 Amount Of Distribution From Participant's Account . . . . . . . . . . . . . . . 29
6.2 Forfeiture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6.3 Form of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
6.4 Timing Of Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
6.5 Earnings On Accounts Of Terminated Participants . . . . . . . . . . . . . . . . 36
6.6 Latest Benefit Commencement Date . . . . . . . . . . . . . . . . . . . . . . . . 36
6.7 Rehire Of Former Plan Participant . . . . . . . . . . . . . . . . . . . . . . . 37
6.8 Precedence Of Code Section 401(a)(9) . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 7 Designation Of Beneficiary . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.2 Absence Of Proper Designation . . . . . . . . . . . . . . . . . . . . . . . . . 38
7.3 Consent Of Spouse . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 8 Committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.1 Appointment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.2 Officers And Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.3 Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.4 Conflict Of Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
8.5 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
8.6 Fiduciaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
8.7 Powers And Duties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
8.8 Information From The Company . . . . . . . . . . . . . . . . . . . . . . . . . . 40
8.9 Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
8.10 Claims Procedure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
8.11 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 9 The Trust Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
9.1 General Responsibilities Of The Trustee . . . . . . . . . . . . . . . . . . . . 43
9.2 Appointment Of Investment Manager . . . . . . . . . . . . . . . . . . . . . . . 43
9.3 Right To Invest In Company Stock . . . . . . . . . . . . . . . . . . . . . . . . 43
9.4 Group Or Common Trusts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 10 Rights Of Participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
10.1 Participants' Rights To Plan Benefits . . . . . . . . . . . . . . . . . . . . . 44
10.2 Employment Rights Under The Plan . . . . . . . . . . . . . . . . . . . . . . . . 44
10.3 Assignment Of Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
10.4 Qualified Domestic Relations Orders . . . . . . . . . . . . . . . . . . . . . . 45
10.5 Incompetency . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
</TABLE>
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<TABLE>
<S> <C>
SECTION 11 Amendment Of Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
11.1 Right To Amend Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
11.2 Protection Of Participants' Rights . . . . . . . . . . . . . . . . . . . . . . . 47
11.3 Mergers, Consolidations And Transfers . . . . . . . . . . . . . . . . . . . . . 48
SECTION 12 Termination Of Plan. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
12.1 General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
12.2 Distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 13 Top Heavy Plan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
13.1 Precedence Of Section . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
13.2 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
13.3 Determination Of Top Heavy Plan . . . . . . . . . . . . . . . . . . . . . . . . 51
13.4 Minimum Benefit Under Top Heavy Plan . . . . . . . . . . . . . . . . . . . . . . 52
13.5 Maximum Limitation Under Top Heavy Plan . . . . . . . . . . . . . . . . . . . . 52
13.6 Compensation In Top Heavy Plan Year . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 14 Withdrawals. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53
14.1 Withdrawals From Rollover or Post-Tax Contribution Account . . . . . . . . . . . 53
14.2 Withdrawals From Pre-Tax Contribution Account . . . . . . . . . . . . . . . . . 53
SECTION 15 Construction And Enforcement Of Plan . . . . . . . . . . . . . . . . . . . . . . 56
15.1 Governing Legal Entity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
15.2 Text To Control . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
15.3 Gender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
15.4 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
15.5 Liability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
</TABLE>
iv
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METROBANK
EMPLOYEE SAVINGS PLAN
SECTION 1
Definitions
Whenever used in this Plan and capitalized, unless a different
meaning is plainly required by the context, the following terms shall have the
meanings set forth below:
1.1 Account(s):
"Account(s)" means the record(s) maintained to record a
Participant's, or his or her Beneficiary's, interest in the Trust Fund. Each
Participant (or, when applicable, Beneficiary) may have a Pre-Tax Contribution
Account as described under Section 5.1(a), an Post- Tax Contribution Account as
described under Section 5.1(b), a Company Matching Contribution Account as
described under Section 5.1(c), a Rollover Contribution Account as described
under Section 5.1(d) and a Special Company Contribution Account as described
under Section 5.1(e).
1.2 Affiliated Company:
"Affiliated Company" means each organization which is a member
of a controlled group, as defined in Section 414(b) or 414(c) of the Code, or
an affiliated service group as defined in Section 414(m) of the Code, with the
Company.
1.3 Anniversary Date:
"Anniversary Date" means the last day of any Plan Year.
1.4 Annual Addition:
"Annual Addition" means, with respect to each Participant for
any Plan Year, the aggregate of:
(a) Pre-Tax Contributions: Pre-Tax Contributions
made by the Participant under this Plan and credited to the Participant's
Pre-Tax Contribution Account;
1
<PAGE> 8
(b) Company Matching Contributions: Matching
contributions made by the Company to this Plan and allocated to his Company
Matching Contribution Account;
(c) Post-Tax Contributions: Post-Tax
Contributions made by the Participant to this Plan and allocated to the
Participant's Post-Tax Contribution Account;
(d) Company Special Contributions: Special
Contributions made by the Company to the Plan and allocated to the
Participant's Special Company Contribution Account(s);
(e) Forfeitures: Although not applicable herein,
any forfeitures allocated to a Participant's Company Matching Contribution
Account;
(f) Post-Retirement Medical Benefits: In the
event the Company pre-funds post-retirement medical benefits in accordance with
Section 419A(d) of the Code, any amount allocated to the separate account of a
Participant who is a Key Employee as defined in Section 13.2(b); and
(g) Other Plan Contributions: Contributions to
the Metrobank Employee Stock Ownership Plan including any reallocated plan
forfeitures.
1.5 Beneficiary:
"Beneficiary" means any person actually entitled, as provided
in Section 7 hereof, to receive benefits by reason of the death of a
Participant. Wherever the rights of a Participant are stated or limited
herein, his Beneficiaries shall be bound by such statement of limitation.
1.6 Board:
"Board" means the Board of Directors of the Company.
1.7 Code:
"Code" means the Internal Revenue Code of 1986, as it may be
amended, or any similar statute enacted in lieu thereof.
1.8 Committee:
"Committee" means the Committee appointed and acting in
accordance with the terms of Section 8.
2
<PAGE> 9
1.9 Company:
"Company" means Metrobank and any Affiliated Company or
successor organization which, with the consent of the Board, adopts the Plan
for its employees.
1.10 Company Matching Contribution Account:
"Company Matching Contribution Account" means the account
established to record the Company matching contributions and forfeitures, if
any, allocated on behalf of a Participant under the Plan, plus earnings
thereon, as described in Section 5.1(c).
1.11 Compensation:
"Compensation" means the base salary or wages (including
overtime pay and bonuses) paid to an Employee by the Company for a Plan Year
(unreduced by 401(k) contributions). Annual Compensation shall be limited to
$150,000 ($200,000 as indexed for years prior to 1994) or such other amount as
may be provided under Code Section 401(a)(17) as adjusted for cost of living.
Compensation shall include W-2 earnings (including amounts attributable to
stock options), except that for deferral purposes, Compensation shall exclude
"special performance" bonuses, severance pay, attendance awards, and "Ideas for
Profit" and other similar suggestion awards.
For purposes of this Section, the determination of
Compensation shall be made by including amounts which are contributed by the
Company pursuant to a salary reduction agreement and which are not includible
in the gross income of the Participant under Code Sections 125, 402(a)(8) or
402(h). For a Participant's initial year of participation, Compensation shall
be recognized as of such Participant's effective date of participation pursuant
to Section 2.
Notwithstanding the above, for purposes of discrimination
testing as provided at Section 3.6, Compensation shall be limited to
Compensation paid to an Employee while a Plan Participant.
In the case of an Employee who is a 5-percent owner (within
the meaning of Code Section 414(q)(3)) or who is both a Highly Compensated
Employee and one of the ten most highly compensated Employees paid the highest
Compensation for the Plan Year, the "family" of such Employee shall be treated
as a single Employee for purposes of applying the $150,000 limit ($200,000
limit as indexed for Plan Years prior to 1994). "Family" includes the
Employee, his spouse and any lineal descendants of the Employee who have not
attained age nineteen (19) before the close of the Plan Year. Compensation for
each family member shall be determined by multiplying the $150,000 limit by a
fraction, the numerator of which is the family member's Compensation
(determined
3
<PAGE> 10
without regard to this paragraph) and the denominator of which is the family's
aggregate Compensation (determined without regard to this paragraph).
1.12 Disability:
"Disability" means a physical or mental condition that is
expected to render a Participant permanently unable to perform his usual duties
or any comparable duties for the Company or an Affiliated Company. The
determination of the existence of such Disability shall be made by the
Committee and shall be final and binding on the Participant and all other
parties. The Committee may require the submission of such medical evidence as
it may deem necessary in order to arrive at its determination or may rely upon
a determination by the Social Security Administration that the Participant is
disabled within the meaning of the Social Security Act. The Committee's
determination of the existence of a Disability will be made with reference to
the nature of the disease or injury and without regard to the period the
Participant is absent from work.
1.13 Effective Date:
"Effective Date" means January 1, 1987, except where
otherwise indicated.
1.14 Eligible Employee:
"Eligible Employee" means each Employee of the Company,
excluding any Employee whose conditions of employment are covered under the
terms of a collective bargaining agreement in which retirement benefits were
the subject of good faith bargaining unless such agreement provides for
coverage of the bargaining unit members under this Plan and who has met the age
and service requirements for Participation, if any, set forth in Sections 2.1
and 2.2.
1.15 Employee:
"Employee" means any person receiving Compensation for
services rendered to the Company or an Affiliated Company, excluding the
following:
(a) Director: Any person serving as a director
only; or
(b) Independent Contractor: Any person who is an
independent contractor and/or for whom the Company or Affiliated Company is not
required to make Social Security contributions; or
(c) Leased Employees: Any person who is a leased
employee, within the meaning of Code Section 414(n), unless such leased
employees constitute more
4
<PAGE> 11
than twenty percent (20%) of the Employees who are not Highly Compensated
Employees, provided that any leased employee who is deemed to be an Employee
under this Section 1.18(c) shall be treated as an Employee employed in an
ineligible job classification.
(d) Employees Who Do Not Work in the United
States: Any person who would otherwise be an Employee except that he or she
receives no earned income from the Company or an Affiliated Company which
constitutes income from sources within the United States.
1.16 Employment:
"Employment" means the period or periods during which an
individual is an Employee.
1.17 Entry Date:
"Entry Date" means the first day of the calendar quarter next
following the date on which the Employee met the eligibility requirements of
Sections 2.1 and 2.2, and upon which date an Eligible Employee may enroll as a
Participant.
1.18 ERISA:
"ERISA" means the Employee Retirement Income Security Act of
1974, and any amendments thereto.
1.19 Forfeiture:
"Forfeiture" means that part of a Participant's Company
Matching Contribution Account which he or she loses, as determined under
Section 6.2(a).
1.20 Highly Compensated Employee:
"Highly Compensated Employee" means, with respect to a Plan
Year:
(a) In General: Subject to Section 1.22(b)
below, an Employee, at any time during the "determination year" or the
"look-back year" (which are both equal to the Plan Year for which testing is
being performed) as defined below:
(1) Who owns more than five percent (5%)
of the Company;
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(2) Whose compensation is in excess of
$75,000 or such greater amount as may be recognized for increases in the cost
of living in accordance with Code Section 415(d);
(3) Whose compensation is in excess of
$50,000 or such greater amount as may be recognized for increases in the cost
of living in accordance with Code Section 415(d), and who is a member of the
Top Paid Group; or
(4) Who is an officer of the Company and
whose compensation exceeds 50 percent of the limitation under Code Section
415(b)(1)(A), provided that if no officer of the Company receives such amount
of compensation for a Plan Year, the officer who receives the highest
compensation for the Plan Year shall be included for the purpose of this
Section, and provided further that no more than the lesser of:
(i) fifty (50) Employees, or
(ii) the greater of three (3) or
ten percent (10%) of all Employees of the Company,
shall be considered officers for
purposes of this Section.
The "look-back year" shall be the calendar year ending with or
within the Plan Year for which testing is being performed and the
"determination year" (if applicable) shall be the period of time, if any, which
extends beyond the "look-back year" and ends on the last day of the Plan Year
for which testing is being performed (the "lag period"). If the "lag period"
is less than twelve months long, the dollar threshold amounts specified above
shall be prorated based upon the number of months in the "lag period."
(b) For purposes of this Section 1.22
and for Section 1.34, "Company" shall mean all employers required to be
aggregated with the Company pursuant to Code Sections 414(b), (c), (m), or (o).
(c) Special Treatment of Certain Family Members:
If an Employee is a member of the family of an Employee who owns more than five
percent (5%) of the Company, or is a member of the family of a Highly
Compensated Employee (as defined above) who is one of the top ten (10) most
highly compensated Employees for a Plan Year, such individual shall not be
treated as a separate Employee, and any Compensation paid to him (and any
contribution on his or her behalf) shall be treated as paid to (or contributed
on behalf of) the five percent (5%) owner or the Highly Compensated Employee.
For purposes of this Section 1.22(c), "family" shall mean the
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Employee's spouse, direct ascendants or descendants and the spouses of such
direct ascendants or descendants.
(d) For purposes of this Section 1.22 and Section
1.37, "Compensation" means W-2 earnings, except that "Compensation" shall
include amounts which are deferred pursuant to a cafeteria plan (within the
meaning of Code Section 125), a cash or deferred arrangement (within the
meaning of Code Section 401(k)) or a tax-sheltered annuity (within the meaning
of Code Section 403(b)).
1.21 Hour of Service means:
(a) Each hour for which an Employee is directly
or indirectly compensated or entitled to compensation by the Employer for the
performance of duties during the applicable computation period;
(b) Each hour for which an Employee is directly
or indirectly compensated or entitled to compensation by the Employer
(irrespective of whether the employment relationship has terminated) for
reasons other than performance of duties (such as vacation, holidays, sickness,
jury duty, disability, lay-off, military duty or leave of absence) during the
applicable computation period;
(c) Each hour for which back pay is awarded or
agreed to by the Employer without regard to mitigation of damages. The same
Hours of Service shall not be credited both under (a) or (b), as the case may
be, and under (c).
(d) Notwithstanding the above,
(1) No more than 501 Hours of Service
are required to be credited to an Employee on account of any single continuous
period during which the Employee performs no duties (whether or not such period
occurs in a single computation period);
(2) An hour for which an Employee is
directly or indirectly paid, or entitled to payment, on account of a period
during which no duties are performed is not required to be credited to the
Employee if such payment is made or due under a plan maintained solely for the
purpose of complying with applicable worker's compensation, or unemployment
compensation or disability insurance laws, and
(3) Hours of Service are not required to
be credited for a payment which solely reimburses an Employee for medical or
medically related expenses incurred by the Employee.
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For purposes of this Section, a payment shall be deemed to be
made by or due from the Employer regardless of whether such payment is made by
or due from the Employer directly, or indirectly through, among others, a trust
fund, or insurer, to which the Employer contributes or pays premiums and
regardless of whether contributions made or due to the trust fund, insurer, or
other entity are for the benefit of particular Employees or are on behalf of a
group of Employees in the aggregate.
An Hour of Service must be counted for the purpose of
determining a Year of Service, a year of participation for purposes of accrued
benefits, a 1-Year Break in Service, and employment commencement date (or
reemployment commencement date). The provisions of Department of Labor
regulations 2530.200b-2(b) and (c) are incorporated herein by reference.
Hours of Service will be credited for employment with any
Affiliated Company.
1.22 Investment Fund or Fund:
"Investment Fund" or "Fund" means the funds described in
Section 5.4(a).
1.23 Net Compensation:
"Net Compensation" means an Employee's total Compensation,
less his Pre-Tax Contributions, for a Plan Year.
1.24 1-Year Break in Service:
"1-Year Break in Service" means the applicable computation
period during which an Employee has not completed more than 500 Hours of
Service with the Employer. Further, solely for the purpose of determining
whether a Participant has incurred a 1-Year Break in Service, Hours of Service
shall be recognized for "authorized leaves of absence" and "maternity and
paternity leaves of absence."
(a) Authorized Leave of Absence:
"Authorized Leave of Absence" means an
unpaid, temporary cessation from active employment with the Employer pursuant
to an established nondiscriminatory policy, whether occasioned by illness,
military service, or any other reason.
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(b) Maternity or Paternity Leave of
Absence:
"Maternity or Paternity Leave of Absence"
means, for Plan Years beginning after December 31, 1984, an absence from work
for any period by reason of the Employee's pregnancy, birth of the Employee's
child, placement of a child with the Employee in connection with the adoption
of such child, or any absence for the purpose of caring for such child for a
period immediately following such birth or placement. For this purpose, Hours
of Service shall be credited for the computation period in which the absence
from work begins, only if credit therefore is necessary to prevent the Employee
from incurring a 1-Year Break in Service, or, in any other case, in the
immediately following computation period. The Hours of Service credited for a
"maternity or paternity leave of absence" shall be those which would normally
have been credited but for such absence, or, in any case in which the
Administrator is unable to determine such hours normally credited, eight (8)
Hours of Service per day. The total Hours of Service required to be credited
for a "maternity or paternity leave of absence" shall not exceed 501.
1.25 Participant:
"Participant" means any Eligible Employee who has become a
Participant in the Plan under the provisions of Section 2. "Former
Participant" means any former Employee who is entitled to receive a
distribution from the Trust. Except with respect to the right to make Pre- Tax
and Post-Tax Contributions under the Plan, the term "Participant" shall include
"Former Participant."
1.26 Plan:
"Plan" means the 401(k) Savings Plan as described herein, and
all subsequent amendments hereto.
1.27 Plan Year or Limitation Year:
"Plan Year" or "Limitation Year" means January 1 to December
31.
1.28 Post-Tax Contribution Account:
"Post-Tax Contribution Account means the Account established
on a Participant's behalf to hold his Post-Tax Contributions plus earnings
thereon as further described in Section 5.1(b).
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1.29 Post-Tax Contributions:
"Post-Tax Contributions" means a nondeductible amount which a
Participant elects to contribute by payroll withholding from his current
Compensation, which amount is contributed to the Plan by the Company and
allocated to such Participant's Post-Tax Contribution Account as further
described in Section 3.10.
1.30 Pre-Tax Contribution:
"Pre-Tax Contribution" means an amount which a Participant
elects to defer by payroll withholding from his current Compensation, which
amount is contributed to the Plan by the Company and allocated to such
Participant's Pre-Tax Contribution Account as further described in Section 3.3.
1.31 Pre-Tax Contribution Account:
"Pre-Tax Contribution Account" means the Account established
on a Participant's behalf to hold his Pre-Tax Contributions, plus earnings
thereon, as further described in Section 5.1(a).
1.32 Retirement Date:
"Retirement Date" means "Normal Retirement Date" or
"Disability Retirement Date" as described in Section 4.
1.33 Rollover Contribution Account:
"Rollover Contribution Account" means the Account established
on a Participant's behalf to hold his rollover contributions from another plan,
plus earnings thereon, as further described in Section 5.1(d).
1.34 Separation From Service Date:
"Separation from Service Date" means the date a Participant
terminates his employment with the Company or an Affiliated Company, as
determined under the Company's or Affiliated Company's personnel policy.
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1.35 Special Company Contribution:
"Special Company Contribution" means a discretionary Company
contribution made to the Plan in order to insure that the Plan complies with
the requirements of Section 3.6. Such contributions shall always be fully
vested and may not be withdrawn for any reason prior to a Participant's
Separation From Service Date or attainment by the Participant of age 59-1/2.
1.36 Special Company Contribution Account:
"Special Company Contribution Account" means the account
established to record Company Special Contributions as defined at Section
3.1(c), if any, allocated on behalf of a Participant under the Plan, plus
earnings thereon. Separate subaccounts for each of these categories of
contribution may be established.
1.37 Spousal Consent:
"Spousal Consent" means the written consent of the
Participant's spouse to a Beneficiary designation, withdrawal or loan by the
Participant or a distribution to the Participant, which consent shall be
witnessed by a notary public, provided that written consent to an election
shall not be required if it is established to the satisfaction of the Committee
that such consent cannot be obtained because there is no spouse, or the spouse
cannot be located, or such other circumstances exist as may be prescribed by
applicable regulation. Any written Spousal Consent, or establishment that such
consent cannot be obtained shall be effective only with respect to such spouse.
1.38 Top Paid Group:
"Top Paid Group" means the top twenty percent (20%) of
Employees of the Company for a Plan Year when ranked in order of compensation
(within the meaning of Section 1.22(d)). In determining the number of Employees
to be included in the top twenty percent (20%), the following Employees shall
be excluded:
(a) New Hires: Employees employed for less than
six (6) months;
(b) Part-Time Employees: Employees who normally
work less than seventeen and one-half (17-1/2) hours per week;
(c) Seasonal Employees: Employees who normally
work less than six (6) months per year;
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(d) Under Age: Employees who have not yet
attained age twenty-one (21);
(e) Union Employees: Union-represented
Employees, except to the extent provided by regulations, and
(f) Nonresident Aliens: Employees who are
classified as nonresident aliens and who have no earned income from a United
States source.
Notwithstanding anything to the contrary in this Section, the
Company may elect, on a consistent and uniform basis, to apply this Section
1.37(a), (b), (c) and (d) above on the basis of a shorter period of service,
smaller number of hours or months, or lower age than specified above.
1.39 Trust:
"Trust" means the legal entity created under the Trust
Agreement to hold the Trust Fund.
1.40 Trust Agreement:
"Trust Agreement" means the separate agreement entered into by
Company and the Trustee for the purpose of holding the Trust Fund.
1.41 Trust Fund:
"Trust Fund" means all monies, securities and assets held by
the Trustee of the benefits of Participants and Beneficiaries.
1.42 Trustee:
"Trustee" means the Trustee(s) appointed by the Board under
the Trust Agreement and any duly appointed successor(s).
1.43 Valuation Date:
"Valuation Date" means the last business date coincident with
or next preceding each date on which the Committee directs the Trustee to
determine the fair market value of assets held under the Trust.
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1.44 Year of Service:
"Year of Service" means the computation period of twelve (12)
consecutive months, herein set forth, and during which an Employee has
completed at least 1,000 Hours of Service.
For purposes of eligibility for participation, the initial
computation period shall begin with the date on which the Employee first
performs an Hour of Service (employment commencement date). The computation
period beginning after a 1-Year Break in Service shall be measured from the
date on which an Employee again performs an Hour of Service. The succeeding
computation periods shall begin with the first anniversary of the Employee's
employment commencement date. However, if one (1) Year of Service or less is
required as a condition of eligibility, then after the initial eligibility
computation period, the eligibility computation period shall shift to the
current Plan Year which includes the anniversary of the date on which the
Employee first performed an Hour of Service. An Employee who is credited with
1,000 Hours of Service in both the initial eligibility computation period and
the first Plan Year which commences prior to the first anniversary of the
Employee's initial eligibility computation period will be credited with two
Years of Service for purposes of eligibility to participate.
For vesting purposes, and all other purposes not specifically
addressed in this Section, the computation period shall be the Plan Year,
including periods prior to the Effective Date of the Plan.
Years of Service and breaks in service will be measured on the
same computation period.
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SECTION 2
Participation
2.1 Participation On The Effective Date:
Each Eligible Employee on the Effective Date who has completed
at least half the requirements for a Year of Service (been employed by the
Company for at least six (6) months and who has completed at least 500 Hours of
Service), as of the Effective Date shall become a Plan Participant on the
Effective Date.
Each Eligible Employee who enrolls shall become a Plan
Participant on the Effective Date.
2.2 Subsequent Participation:
Each other Employee shall become a Participant on the Entry
Date coincident with or next following both his employment by the Company for
at least six (6) months and his completion of at least 500 Hours of Service.
If he or she is not an Eligible Employee on such date, he or she shall become a
Participant on the Entry Date coincident with or next following attainment of
that status.
Each other Eligible Employee shall become a Participant on the
Entry Date coincident with or next following his or her date of hire.
2.3 Loss Of Active Participant Status:
An Employee or former Employee will cease to be an active
Participant in the Plan upon his or her Separation from Service Date or upon
losing his or her status as an Eligible Employee and will, thereafter, become a
Former Participant until such time as he or she is paid from the Trust (under
the provisions of Section 6), the Plan benefit to which such Former Participant
is entitled. A Former Participant shall not be entitled to make Pre-Tax or
Post-Tax Contributions or share in the allocation of Company matching
contributions. However, if he or she remains an Employee, such Former
Participant shall continue to be credited with Hours of Service for vesting
purposes.
2.4 Rehire Of Former Participant:
If a Participant terminates employment or otherwise incurs at
least a One Year Break in Service, his active participation in the Plan shall
be suspended; but such Participant may again join the Plan if employed on the
Entry Date after he has completed at least 500 Hours of Service during a six
(6) month period. If a Participant terminates
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employment but returns before incurring a One Year Break in Service, his
participation in the Plan shall commence immediately.
2.5 Elections Upon Commencement of Participation:
Effective as of the date upon which an Employee first becomes
a Participant in the Plan, such Employee shall make elections as to amounts to
be deferred under Section 3.3. of the Plan and investments under Section 5.4(c)
of the Plan.
2.6 National Bank of Long Beach:
Effective upon the closing date of the acquisition of the
National Bank of Long Beach (the "Closing Date"), the National Bank of Long
Beach Employees 401(k) Plan shall merge into this plan and all participants at
that time in the National Bank of Long Beach Employee 401(k) Plan shall become
Participants in this Plan. Any other National Bank of Long Beach employee as
of the Closing Date may become a Plan Participant as set forth in Section 2.2
above. For participation purposes as defined in this Section 2, employees of
National Bank of Long Beach as of the Closing Date shall be credited under this
Plan for each Hour of Service earned while an employee of National Bank of Long
Beach.
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SECTION 3
Contributions
3.1 Company Contributions:
(a) Matching Contribution: The Company may make
discretionary matching contributions which shall be paid quarterly to
Participants employed at the end of the quarter in proportion to certain
Pre-Tax Contributions as set forth in the following formula and which shall be
allocated to the Company Matching Contribution Accounts.
Effective January 1, 1995, if the Company makes a matching
contribution, for each whole percent from 1% to 6% (1% to 3% for 1993 and 1994
Plan Years) of Participant Pre-Tax Contribution, the Company may make matching
contributions of not more than 50%.
Matching Contributions shall not exceed One Thousand Seven
Hundred Dollars ($1,700) per Participant per Plan Year ($900 for Plan Years
prior to 1994).
(b) Special Contributions (QNECs and QMACs): The
Company may also contribute a fully vested, qualified nonelective contribution
or qualified matching contribution the exact amount and receipt of which may be
determined in a nondiscriminating manner each year by the Company and which
shall be treated as an elective contribution for testing purposes hereunder.
(c) In no event shall Company contributions,
together with Pre-Tax Contributions, if applicable, for a Plan Year exceed in
total the maximum amount deductible under the provisions of Section 404(a) of
the Code. Company contributions are hereby expressly conditioned upon
deductibility under such Code section.
3.2 Timing of Company Contributions:
Special Company Contributions may be made for a Plan Year at
any time prior to the end of the Plan Year following the Plan Year to which the
contribution relates.
3.3 Pre-Tax Contributions:
Commencing on the Effective Date each Participant may elect,
subject to the right of the Committee to establish uniform and
nondiscriminatory rules and, from time to time, to modify or change such rules
governing the manner and methods by which Pre-Tax Contributions shall be made,
to reduce his Compensation by the deferral
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<PAGE> 23
percentage, which amount the Company shall then contribute to the Trust and
allocate to his Pre-Tax Contribution Account in accordance with the following
provisions:
(a) Regular Pre-Tax Contributions: At times
determined by the Committee, each Participant shall have the opportunity to
elect to defer a percentage of his Compensation, subject to the remainder of
this Section 3.3. Pre-Tax Contributions shall generally be made by a
Participant by entering into an agreement authorizing regular payroll
withholdings by the Company.
(b) Amount of Pre-Tax Contributions: A
Participant shall be entitled to elect to defer monthly at least one percent
(1%) but not more than fifteen percent (15%) of his Compensation, in increments
of one percent (1%). Highly Compensated Employees may be subject to additional
limitations on their contributions as may be necessary for the Plan to meet the
requirements of Section 3.6. The Pre- Tax Contributions of each Participant in
a calendar year shall not exceed, in the aggregate, $9,240. The $9,240 amount
shall be adjusted each calendar year as provided in Code Section 402(g)(5).
(c) Cessation of Pre-Tax Contributions: A
Participant may direct the Company to cease Pre-Tax Contributions as soon as
practicable after written notice to such effect has been delivered by such
Participant to the Company.
(d) Change in Pre-Tax Contributions: As of each
Entry Date, each Participant shall have the opportunity to elect to increase or
decrease his Pre-Tax Contribution amount.
3.4 Timing Of Pre-Tax Contributions:
The Company's contribution to the Trust for a Plan Year
consisting of Pre-Tax Contributions shall generally be made as soon as possible
after the end of each payroll period.
3.5 Return Of Contributions To The Company:
(a) Return of Contributions: Subject to Section
3.7, Company contributions and Pre-Tax Contributions may be returned by the
Trustee to the Company if:
(1) They were made in excess of the
amount deductible by the Company for its taxable year, or
(2) They were made because of a
reasonable mistake as to the facts and circumstances existing at the time the
contributions were made.
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As soon as practicable following the return
of funds to the Company under this Section 3.5(a), such funds shall, if they
were originally Pre-Tax Contributions, be paid by the Company to the
Participants making such original contributions.
(b) Limitation: Any return of Pre-Tax
Contributions or Company contributions under Section 3.5(a) shall be limited,
respectively, to:
(1) That portion in excess of the amount
deductible by the Company for its taxable year, or
(2) That portion of the contribution
attributable to a reasonable mistake of fact, and further provided that any
such return must be made within one year of the date the contribution was
determined to be nondeductible or the mistaken contribution was made.
3.6 Discrimination Test Requirements:
The provisions of this Plan are intended to comply with the
provisions of Code Section 401(k)(3) and Federal Tax Regulation
1.401(k)-l(b)(4) thereunder, and such provisions are hereby incorporated into
this Plan. If there is a discrepancy between any provision of this Plan and
the provisions of Code Section 401(k)(3) and Regulation 1.401(k)-1(b)(4)
thereunder, such discrepancy shall be resolved so as to give full effect to the
provisions of Code Section 401(k)(3) and Regulation 1.401(k)-1(b)(4)
thereunder.
Similarly, the provision of Code Section 401(m) and Federal
Tax Regulations 1.401(m)-1(b)(3) and 1.401(m)-2 are hereby incorporated into
this Plan. Any discrepancy between such provisions and any provision of this
Plan shall be resolved so as to give full effect to such provisions.
For testing purposes net compensation after deduction for
Pre-Tax Contribution.
For purposes of this section, the determination period and the
look-back period shall be the same.
3.7 Corrective Actions:
In order to satisfy the requirements of Section 3.6 for a Plan
Year, the Committee may take any corrective action not prohibited by law
including, but not limited to, one or more of the following:
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(a) Curtail Pre-Tax Contributions: Reduce or
discontinue, as necessary, future Pre-Tax Contributions for some or all of the
Highly Compensated Employees for the remainder of the Plan Year.
(b) Refund Pre-Tax Contributions: Refund, as
necessary, Pre-Tax Contributions and income allocable thereto to some or all of
the Highly Compensated Employees.
The actual deferral ratio (ADR) of the Highly
Compensated Employee with the highest ADR is reduced by refunding Pre- Tax
Contributions to the extent necessary to satisfy the requirements of Section
3.6 (ADP test) or to cause such ADR to equal the ADR of the Highly Compensated
Employee with the next highest ADR. This process shall be repeated until the
ADP test is satisfied. The amount of Pre-Tax Contributions to be refunded to a
Highly Compensated Employee pursuant to this procedure is the excess, if any,
of his Pre-Tax Contributions for the Plan Year over the product of this reduced
ADR and his or her Compensation.
If the ADR of a Highly Compensated Employee is
determined under the family aggregation rules, then any Pre-Tax Contributions
that are refunded shall be allocated among the family members in proportion to
their Pre-Tax Contributions for the Plan Year.
Income to be refunded under this paragraph shall be
determined by multiplying income allocable to Pre-Tax Contribution Accounts for
the Plan Year by a fraction, the numerator of which is the amount of Pre-Tax
Contributions to be refunded and the denominator of which is the sum of the
balance of all Pre-Tax Contribution Accounts as of the first day of such Plan
Year and the Pre-Tax Contributions credited to such Accounts during the Plan
Year. No income shall be allocable for the period between the last day of the
Plan Year and the date on which payment is made pursuant to this Section
3.7(b).
The amount of Pre-Tax Contributions distributed under
this Section 3.7 shall be reduced by any amounts previously distributed under
Section 3.3(b) with respect to the Participant for the Plan Year. In no event
shall distributions for a Plan Year under Sections 3.3(b) and 3.7 exceed the
Participant's Pre-Tax Contributions for such Plan Year.
(c) Make a Special Company Contribution: Make a
Special Company Contribution to the Plan as provided under Section 5.2(b) or
vest all or a portion of one or more Participant Matching Contribution so as to
qualify as a Special Company Contribution;
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(d) Forfeit or Distribute Company Matching
Contributions: Forfeit or distribute (to the extent vested), as necessary,
Company Matching Contributions for some or all of the Highly Compensated
Employees. The amount to be forfeited by or distributed to a Highly
Compensated Employee shall be determined as provided in Federal Tax Regulation
1.401(m)-l(e).
(e) Change Definition of Compensation: Use net
compensation after deduction of Pre-Tax Contributions in calculation of ADP
test.
(f) Restructure: Restructure the Plan into two
parts - those eligible Employees who have met the statutory minimum age and
service eligibility conditions and those who have not but have met the Plan's
age and service conditions - and test each separately.
3.8 Rollovers From Other Qualified Plans:
Each Participant in the Plan or each Employee who is expected
to become eligible to participate in the Plan and who has had distributed or is
eligible to have distributed to him or her the entire interest in a plan (the
"Other Plan") which meets the requirements of Section 401(a) of the Code may,
in accordance with procedures approved by the Committee, transfer the
distribution received from such Other Plan to the Trustee provided the
following conditions are met:
(a) Timing of Transfer: The transfer occurs via
a direct rollover or if otherwise in no event later than the sixtieth (60th)
day following receipt of the distribution from the Other Plan (or from an
Individual Retirement Account which consisted of a prior distribution from the
Other Plan);
(b) Maximum Amount of Transfer: The amount
transferred is not in excess of the total distribution received from the Other
Plan (plus earnings thereon accrued during the period that an interim
Individual Retirement Account had been established) less the amount, if any,
considered contributed by such Employee in accordance with Section 402(c) of
the Code;
(c) Type of Transfer: The transfer consists
entirely of cash.
(d) Effect of Transfer: The amounts transferred
shall be fully vested, shall not jeopardize the tax exempt status of the Plan
or cause adverse tax consequences and shall be subject to the distribution
limitations set forth in Reg 1.401(k-1(d).
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The Committee shall have full responsibility for determining
whether or not the requirements of the Code and Regulations have been met with
respect to each transfer.
3.9 Allocation of Forfeitures:
Forfeitures of Company contributions will be used to reduce
the Company's matching contribution or applied to pay Plan expenses at the
discretion of the Committee.
3.10 Post-Tax Contributions:
Although Post-Tax Contributions could be made by all
Participants prior to 1992, effective January 1, 1992, only non-Highly
Compensated Participants may increase their retirement savings by electing to
make nondeductible Post-Tax Contributions of a portion of their Compensation
not to exceed ten percent of Compensation earned while a Participant under the
Plan. Such contributions shall be withheld from payroll, promptly forwarded to
the Trustee (but in no event later than 90 days after receipt) and credited to
the Participant's Post-Tax Contribution Account. The balance in each
Participant's Post-Tax Contribution Account shall be fully vested at all time.
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SECTION 4
Retirement Dates
4.1 Normal Retirement Date:
The "Normal Retirement Date" and "Normal Retirement Age" mean
a Participant's sixty-fifth (65th) birthday.
4.2 Disability Retirement Date:
The "Disability Retirement Date" means the date a Participant
terminates from the Company or an Affiliated Company upon suffering a
Disability.
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SECTION 5
Participant's Credit In The Trust Fund
5.1 Accounts:
(a) Pre-Tax Contribution Account: A Pre-Tax
Contribution Account shall be opened and maintained by the Committee for each
Participant who has elected to make Pre-Tax Contributions under Section 3.3 in
which shall be recorded the amount of his Pre-Tax Contributions, adjustments
for allocations of income or loss, distributions and all other information
affecting the value of such Account.
(b) Post-Tax Contribution Account: An Post-Tax
Contribution Account shall be opened and maintained by the Committee for each
Participant who has elected to make Post-Tax Contributions under Section 3.10
in which shall be recorded the amount of his or her Post-Tax Contributions,
adjustments for allocations of income or loss, distributions and all other
information affecting the value of such Account.
(c) Company Matching Contribution Account: To
the extent there are Company matching contributions, a Company Matching
Contribution Account shall be maintained by the Committee for each Participant
in which shall be recorded the amounts of the Company's matching contributions
on his behalf under Section 5.2(a), adjustments for allocations of income or
loss, distributions and all other information affecting the value of such
Account.
(d) Rollover Contribution Account: A Rollover
Contribution Account shall be opened and maintained by the Committee for each
Participant who makes a rollover contribution in accordance with Section 3.8,
in which shall be recorded the amount of his rollover contributions, adjustment
for allocations of income or loss, distributions and all other information
affecting the value of such Account.
(e) Special Company Contribution Account: To the
extent there are Special Contributions as described in Section 3.1, a Special
Company Contribution Account or Accounts shall be maintained by the Committee
for each Participant in which shall be recorded the amounts of the Company's
Special Contributions, if any, allocated on the Participant's behalf under
Section 5.2(b), adjustments for allocations of income or loss, distributions
and all other information affecting the value of such Account.
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<PAGE> 30
5.2 Allocation Of Company Contributions:
Company contributions to the Trust Fund for each Plan Year,
shall be allocated to the Special Company Contribution Account and/or Company
Matching Contribution Account of each Participant, as follows:
(a) Company Matching Contributions: Each period,
the Committee shall specify the maximum amount of Pre-Tax Contributions,
expressed as a percentage of Compensation, which shall be matched during the
period. The amount of the Company's matching contributions for a period, if
any, to be allocated to the Company Matching Contribution Account of each
Eligible Participant shall be determined by multiplying such amount by a
fraction, the numerator of which is the Pre-Tax Contributions made by such
Participant during the period (but not more than the maximum amount eligible
for matching as provided above), and the denominator of which is the aggregate
of Pre-Tax Contributions (limited as provided above) made by all Eligible
Participants during such period.
(b) Special Company Contributions: Any Special
Contributions made to the Plan pursuant to Section 3.7(c) shall be allocated to
a fully vested special Company Contribution Account of one or more Eligible
Participants who are not Highly Compensated Employees in the ratio that each
such Participant's Compensation bears to the Compensation of all Eligible
Participants who are not Highly Compensated Employees, or in such other
nondiscriminatory manner as will allow the Plan to pass the discrimination
requirements set forth in Section 3.6.
5.3 Maximum Annual Addition:
(a) Maximum Annual Addition: The maximum Annual
Addition to a Participant's Accounts for any Limitation Year shall in no event
exceed the lesser of:
(1) $30,000 (or if greater, one-fourth
(1/4) of the dollar limitation in effect for the Plan Year under Code Section
415(b)(1)(A)), or
(2) Twenty-five percent (25%) of his Net
Compensation.
(b) Excess Annual Addition: In the event there
is an excess Annual Addition for a Participant, if the Participant had made
Post-Tax Contributions and/or Pre-Tax Contributions for such Plan Year, first
such Post-Tax Contributions and then such Pre-Tax Contributions shall be
returned to the Participant to the extent necessary to avoid the excess Annual
Addition. If an excess Annual Addition remains thereafter on behalf of a
Participant, such excess contribution shall be held in suspense account in the
Trust Fund and shall be allocated on behalf of Eligible Participants in
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<PAGE> 31
subsequent Plan Years in accordance with Section 5.2 hereof. During any period
that such a suspense account is maintained:
(1) No Company Matching Contributions,
Post-Tax Contributions or Pre-Tax Contributions may be made which would cause
the limits described in Section 5.3(a) to be exceeded;
(2) Investment gains and losses or other
income shall not be allocated to the suspense account; and
(3) The suspense account shall continue
to be allocated on behalf of applicable Eligible Participants as of each
Anniversary Date until the suspense account is exhausted.
(c) Multiple Defined Contribution Plans: If the
Company is contributing to another defined contribution plan, as that term is
defined in Section 414(i) of the Code, for Employees of the Company, some or
all of whom may be Participants in this Plan, then any such Participant's
Annual Addition in such other plan shall be aggregated with such Participant's
Annual Addition derived from this Plan for purposes of applying the limitations
under Section 5.3(a) above.
(d) Limitation for Multiple Plans: In any case
in which an Employee is a participant in both one or more tax-qualified defined
benefit plans maintained by the Company or an Affiliated Company, and this
Plan, the sum of the defined benefit plan fraction and the defined contribution
plan fraction for the Limitation Year shall not exceed 1.0.
(1) The defined benefit plan fraction
for any Limitation Year is a fraction:
(i) the numerator of which is the
projected annual benefit of the Employee in the defined benefit plan(s),
determined as of the close of the Limitation Year, and
(ii) the denominator of which is the
lesser of (A) or (B), as follows:
(A) 1.25 multiplied by the
defined benefit plan dollar limitation in effect for such year, or
(B) 1.4 multiplied by one
hundred percent (100%) of the Employee's average Net Compensation for the three
(3) consecutive
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<PAGE> 32
Limitation Years during which he was a participant and had the greatest
aggregate Net Compensation from the Company, determined as of the close of the
Limitation Year.
(2) The defined contribution plan
fraction for any Limitation Year is a fraction:
(i) the numerator of which is the
sum of the Annual Additions made on behalf of the Employee as of the close of
the Limitation Year, and
(ii) the denominator of which is the
sum of the lesser of (A) or (B) for such year and each prior year of service
with the Company:
(A) 1.25 multiplied by the
defined contribution plan dollar limitation under Section 5.3(a)(1) in effect
for such year, or
(B) 1.4 multiplied by
twenty-five percent (25%) of the Employee's Net Compensation for such year.
In determining the limitation for multiple
plans under this Section 5.3(d), the defined contribution plan fraction for the
Limitation Year shall be calculated first and then the defined benefit plan
fraction shall be calculated, such that the benefit provided under the defined
plan shall be reduced, as necessary, to comply with the requirements of this
Section 5.3(d).
(e) Precedence of Code Section 415: The
limitations of this Section 5.3 are intended to comply with the provisions of
Code Sections 415 as amended so that the maximum benefits provided by plans of
the Company shall be exactly equal to the maximum amounts allowed under Code
Section 415 and regulations thereunder. If there is any discrepancy between
the provisions of this Section 5.3 and the provisions of Code Section 415 and
regulations thereunder, such discrepancy shall be resolved in such a way as to
give full effect to the provisions of Code Section 415.
5.4 Investment Funds:
(a) Investment Funds: Investment Funds shall be
established for the purpose of investing Plan assets. The number of such Funds
and the type of investments therein may be changed at any time by the
Committee.
(b) Investment of Accounts: Each Participant
shall have the opportunity to direct the investment of his Accounts among the
Investment Funds. At times determined by the Committee, a Participant may make
an investment election or change a prior election. An election may be
designated as applicable to future
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<PAGE> 33
contributions or to the transfer of existing Account balances. The Committee
shall establish the manner and frequency of such elections.
5.5 Allocation Of Trust Fund Earnings:
As of each Valuation Date, the net earnings and gains or
losses of the Trust Fund during the period since the preceding Valuation Date
shall be allocated among the Accounts of Participants and Former Participants
invested in each Investment Fund as of such Valuation Date.
As of each Anniversary Date or other Valuation Date, before
allocation of Company contributions, any earnings or losses (net appreciation
or net depreciation) of each investment fund will be allocated pro rata among
the Accounts within that investment fund. The balance in each such Account to
be taken into consideration for purposes of this allocation shall be the
balance as of the first day of the period in which falls such date; reduced by
charges thereto made during the period on account of total distributions to the
Participant or the Beneficiary thereof; further, such balance shall be
increased by the weighted value of Pre-Tax Contributions, employee Post-Tax
Contributions and rollovers made to the Trust during such period and decreased
by the weighted value of all partial distributions.
The weighted value of such contributions or distributions
shall be determined by prorating the Trust Fund gains or losses to the number
of days elapsing from the date such contributions were deducted from the
Compensation of the Participant (or rolled over) or the days elapsing from the
date such partial distributions were withdrawn from the investment fund, to the
end of such period.
5.6 Accounting:
All accounting for the Trust, other than adjustment of the
Accounts to reflect the market value of Trust assets, shall be rendered on a
cash basis, except that Company contributions shall be credited to (i) Company
Contribution Accounts in accordance with Section 5.2(c) as of the Anniversary
Date of the Plan Year for which the contributions are made and (ii) Company
Matching Contribution Accounts as of each payroll period in accordance with
Section 5.2(b).
5.7 Valuation:
The Trust Fund shall be valued as of each Valuation Date on
the basis of the fair market value of the assets held on such date by the
Trustee.
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<PAGE> 34
5.8 Limitation:
Nothing herein contained shall be deemed to give any
Participant any interest in any specific property of the Trust Fund or to vest
in him any right, title or interest in or to any asset of the Trust Fund. Each
Participant shall have only the right to receive payment at the time or times
and upon the terms and conditions expressly set forth in the Plan.
5.9 Forfeiture Of Benefits Where Recipient Cannot Be
Located:
(a) Forfeiture of Benefits: Except as provided
in Section 5.9(b) below, if a Participant is entitled to receive a benefit
under this Plan and such benefit has not been paid for a period of five (5)
years from the date such benefit was to commence because the Company has been
unable to locate said Participant or his or her Beneficiary, the Committee
shall declare the benefit to be a Forfeiture and shall allocate it in
accordance with Section 3.9. During the period between the date the
distribution originally would have been made under the Plan and the earlier to
occur of the conclusion of the above described five (5) year period or the
location of the Participant or Beneficiary as described in Section 5.9(b), the
Participant's benefit shall be held in an Investment Fund determined by the
Committee.
(b) Subsequent Appearance of Recipient: Should a
Participant or Beneficiary, whose benefit had been forfeited under the
provisions of Section 5.9(a), later be located, the Committee shall immediately
direct the Trustee to make payment of benefits to said Participant or his
Beneficiary according to the terms of the Plan. Such payments shall be made
without interest from unallocated Forfeitures and, to the extent such amounts
are insufficient, from funds contributed by the Company or an Affiliated
Company as a special contribution.
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<PAGE> 35
SECTION 6
Participant's Right To Payment
6.1 Amount Of Distribution From Participant's Account:
Payments to or on behalf of a Participant shall be made from
the Trust Fund, in accordance with Sections 6.3 and 6.4, in the amounts and
upon the events stated below:
(a) Pre-Tax Contribution Account, Rollover
Contribution Account, Post-Tax Contribution Account and Special Subaccount:
(1) In the event a Participant reaches
his Separation from Service Date or age 59 1/2, he (or his Beneficiary in the
event of his death) shall be entitled to receive one hundred percent (100%) of
the amount credited to his (i) Pre-Tax Contribution Account, (ii) Post-Tax
Contribution Account, (iii) Rollover Contribution Account, and (iv) the Special
Company Contributions Account. Distribution will be made as soon as
administratively possible following receipt of completed and executed forms
approved by the Committee.
(2) No more frequently than once in any
12-month period (or such other frequency limitation as the Committee may
provide), a Participant may withdraw any portion of the value of his or her
Post-Tax Contribution Account.
(b) Company Matching Account:
(1) In the event of attainment of his
Normal Retirement Date, finding of a Disability or the Participant's death, a
Participant shall be entitled (or his Beneficiary shall be entitled in the
event of his death) to receive one hundred percent (100%) of the amount
credited to his Company Matching Contribution Accounts as of the last day of
the month coincident with or next following such event.
(2) Other Termination of Service: Prior
to January 1, 1995, only a Participant with 5 or more Years of Service would be
entitled to receive all his Company Matching Contribution Account upon
termination of employment. Effective January 1, 1995, a Participant who
reaches his Separation from Service Date prior to a Retirement Date (and other
than by reason of death), shall be entitled to receive the percent of his
Company Matching Contribution Account balance, set forth on the
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<PAGE> 36
following table, as of the last day of the month coincident with or next
following such Separation from Service Date or as soon thereafter as is
administratively possible:
<TABLE>
<CAPTION>
YEARS OF VESTED
SERVICE PERCENTAGE
-------- ----------
<S> <C>
LESS THAN 2 YEARS 0%
2 TO 3 YEARS 25%
3 TO 4 YEARS 50%
4 TO 5 YEARS 75%
5 OR MORE YEARS 100%
</TABLE>
If a Participant terminates his employment with the Company or
an Affiliated Company without becoming entitled to a nonforfeitable interest in
his Company Matching Account as provided in Section 6.1(b)(2) and is rehired
after the close of a five-year period which constitutes a Period of Severance,
then Years of Service for vesting purposes attributable to the prior period of
employment shall be disregarded for purposes of determining such Participant's
position on the vesting schedule after such rehire.
(3) Attainment of Age 59 1/2:
Upon attainment of age 59 1/2, a Participant may
withdraw the vested balance of the amount credited to his Company Matching
Contribution Accounts as of the last day of the month coincident with or next
following such event. However, no distribution shall occur prior to 100%
vesting.
(4) National Bank of Long Beach Employees:
For vesting purposes as defined in this Section 6.1,
employees of National Bank of Long Beach as of the Closing Date shall be
credited under this Plan for each Hour of Service earned while an employee of
National Bank of Long Beach.
6.2 Forfeiture:
(a) Timing of Forfeiture:
(1) Distribution: Where a Participant
has terminated his employment with the Company or an Affiliated Company and has
received a lump sum distribution of his Accounts to the extent vested, his
nonvested Company Matching Contribution Account balance shall be forfeited
immediately following such distribution.
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<PAGE> 37
(2) No Distribution: Where a
Participant has terminated his employment with the Company or an Affiliated
Company and has not received a distribution of his Accounts to the extent
vested, his nonvested Company Matching Contribution Account balance shall be
forfeited as of the close of the first five-year period which constitutes a
Period of Severance following termination.
(b) Restoration of Forfeitures:
(1) Rehire Prior to Permanent
Forfeiture: In the event a Participant is rehired by the Company prior to the
earlier of the fifth anniversary of his Separation from Service Date and the
close of the first five-year period which constitutes a Period of Severance,
the Participant will have recredited to his Company Matching Contribution
Account the balance without interest which he forfeited on his prior
termination of Employment but only if such Participant repays the full amount
distributed to him or her before the earlier of five (5) years after the date
the Participant is rehired or the close of the first period of five (5)
consecutive 1-year Breaks in Service starting after the distribution.
In the event the rehired Participant does repay the full
amount distributed to him or her, or in the event of a deemed distribution, the
undistributed portion of the Company Matching Contribution Account will be
restored in full, unadjusted by any gains or losses.
(2) Rehire after Permanent Forfeiture: In the
event a Participant is rehired subsequent to the earlier of the fifth
anniversary of his Separation from Service Date and the close of the first
five-year period which constitutes a Period of Severance after the
distribution, the Participant's prior Company Matching Contribution Account
balance shall be deemed to be a permanent Forfeiture and shall not be
recredited to the Participant's Account(s).
6.3 Form of Distribution:
(a) (1) Unless otherwise elected as provided
below, a Participant who is married on the "annuity starting date" and who does
not die before the "annuity starting date" shall receive the value of all of
his or her benefits in the form of a joint and survivor annuity. Such joint
and survivor annuity benefits the Participant during his or her lifetime and
following the Participant's death shall continue to the spouse during the
spouse's lifetime at a rate equal to 50% of the rate at which such benefits
were payable to the Participant. This joint and 50% survivor annuity shall be
considered the designated qualified joint and survivor annuity and automatic
form of payment for the purposes of this Plan. However, the Participant may
elect to receive a smaller annuity benefit with continuation of payments to the
spouse at a rate of seventy-five percent (75%) or one hundred percent (100%) of
the rate payable to a Participant
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<PAGE> 38
during his or her lifetime, which alternative joint and survivor annuity shall
have a present value equal to the automatic joint and 50% survivor annuity. An
unmarried Participant shall receive the value of his or her benefit in the form
of a life annuity. Such unmarried Participant, however, may elect in writing
to waive the life annuity. The election must comply with the provisions of
this Section as if it were an election to waive the joint and survivor annuity
by a married Participant, but without the spousal consent requirement. The
Participant may elect to have any annuity provided for in this Section
distributed upon the attainment of the "earliest retirement age" under the
Plan. The "earliest retirement age" is the earliest date on which, under the
Plan, the Participant could elect to receive retirement benefits.
(2) Any election to waive the joint and
survivor annuity must be made by the Participant in writing during the election
period and be consented to by the Participant's spouse. If the spouse is
legally incompetent to give consent, the spouse's legal guardian, even if such
guardian is the Participant, may give consent. Such election shall designate a
Beneficiary (or a form of benefits) that may not be changed without spousal
consent (unless the consent of the spouse expressly permits designations by the
Participant without the requirement of further consent by the spouse). Such
spouse's consent shall be irrevocable and must acknowledge the effect of such
election and be witnessed by a Plan representative or a notary public. Such
consent shall not be required if it is established to the satisfaction of the
Committee that the required consent cannot be obtained because there is no
spouse, the spouse cannot be located, or other circumstances that may be
prescribed by Regulations. The election made by the Participant and consented
to by his spouse may be revoked by the Participant in writing without the
consent of the spouse at any time during the election period. The number of
revocations shall not be limited. Any new election must comply with the
requirements of this paragraph. A former spouse's waiver shall not be binding
on a new spouse.
(3) The election period to waive the
joint and survivor annuity shall be the 90-day period ending on the "annuity
starting date."
(4) For purposes of this Section, the
"annuity starting date" means the first day of the first period for which an
amount is paid as an annuity, or, in the case of a benefit not payable in the
form of an annuity, the first day on which all events have occurred which
entitle the Participant to such benefit.
(5) With regard to the election, the
Administrator shall provide to the Participant no less than 30 days and no more
than 90 days before the "annuity starting date" a written explanation of:
(i) the terms and conditions of the
joint and survivor annuity, and
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<PAGE> 39
(ii) the Participant's right to
make, and the effect of, an
election to waive the joint
and survivor annuity, and
(iii) the right of the Participant's
spouse to consent to any
election to waive the joint
and survivor annuity, and
(iv) the right of the Participant to
revoke such election, and the
effect of such revocation.
(b) In the event a married Participant duly
elects, pursuant to paragraph (a)(2) above, not to receive his or her benefit
in the form of a joint and survivor annuity, or if such Participant is not
married, in the form of a life annuity, the Participant or his or her
Beneficiary may take distribution of any amount to which he or she is entitled
under the Plan in one or more of the following methods:
(1) One lump-sum payment in cash;
(2) Payments over a period certain in
monthly, quarterly, semiannual, or annual cash installments. In order to
provide such installment payments, the Committee may (A) segregate the
aggregate amount thereof in a separate, federally insured savings account,
certificate of deposit in a bank or savings and loan association, money market
certificate or other liquid short-term security or (B) purchase a
nontransferable annuity contract for a term certain (with no life
contingencies) providing for such payment. The period over which such payment
is to be made shall not extend beyond the Participant's life expectancy (or the
life expectancy of the Participant and his or her designated Beneficiary).
(c) Directed Rollover:
(1) Notwithstanding any provision of the
Plan to the contrary that would otherwise limit a distributee's election under
this Section 6.3, a distributee may elect, at the time and in the manner
prescribed by the 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.
(2) Definitions:
(i) 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
33
<PAGE> 40
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 includible in gross income (determined without regard to the exclusion
for net unrealized appreciation with respect to employer securities).
(ii) 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, 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.
(iii) 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 respect
to the interest of the spouse or former spouse.
(iv) Direct rollover: A direct
rollover is a payment by the Plan to the eligible retirement plan specified by
the distributee.
(d) Payment in Stock:
Any provisions to the contrary not
withstanding, distributions of funds held in a Company Stock Fund and invested
in Company Stock may be made in a nondiscriminatory manner in either cash or
whole shares of Company Stock. The value of any fractional share may be
distributed in cash.
(e) National Bank of Long Beach
Employees:
In addition to any other forms of
distribution set forth in this Section 6.3, former employees of National Bank
of Long Beach who become Plan Participants as a result of the merger of the
National Bank of Long Beach Employee's 401(k) Plan into this Plan shall be
entitled to have their account balances as of the merger (plus earnings but
excluding any additional contributions) distributed in substantially equal
monthly installments over a ten year period.
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<PAGE> 41
6.4 Timing Of Distribution:
(a) General Rule: Subject to the remainder of
this Section 6.4, distribution of benefits under the Plan shall generally be
made as soon as practicable after the Valuation Date following a Participant's
Separation from Service Date. SPOUSAL CONSENT MUST BE OBTAINED BEFORE ANY
DISTRIBUTION CAN BE MADE TO A MARRIED PARTICIPANT.
(b) Any distribution to a Participant of a
benefit less than $3,500 shall be paid in a single lump sum. Only a
distribution to a Participant who has a benefit which exceeds, or has ever
exceeded, $3,500 at the time of any prior distribution shall require such
Participant's consent if such distribution commences prior to the later of his
Normal Retirement Age or age 62. With regard to this required consent:
(1) No consent shall be valid unless the
Participant has received a general description of the material features and an
explanation of the relative values of the optional forms of benefit available
under the Plan that would satisfy the notice requirements of Code Section 417.
(2) The Participant must be informed of
his right to defer receipt of the distribution. If a Participant fails to
consent, it shall be deemed an election to defer the distribution of any
benefit. However, any election to defer the receipt of benefits shall not
apply with respect to distributions which are required under Section 6.4(c).
(3) As set forth in 6.3(a), notice of
the rights shall be provided no less than 30 days and no more than 90 days
before the first day on which all events have occurred which entitle the
Participant to such benefit.
(4) Written consent of the Participant
to the distribution must not be made before the Participant receives the notice
and must not be made more than 90 days before the first day on which all events
have occurred which entitle the Participant to such benefit.
(5) No consent shall be valid if a
significant detriment is imposed under the Plan on any Participant who does not
consent to the distribution.
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 Regulation 1.411(a)-11(c) is given,
provided that: (1) the Committee clearly informs the Participant that the
Participant has a right to a period of at least 30 days after receiving the
notice to consider the decision of whether or not to elect a distribution (and,
35
<PAGE> 42
if applicable, a particular distribution option), and (2) the Participant,
after receiving the notice, affirmatively elects a distribution.
(c) Retirement: Distribution of benefits shall
generally be made no later than the April 1 following the calendar year in
which an Employee attains age seventy and one-half (70-1/2).
(d) Death: In the event of the death of a
Participant prior to the payment of Plan benefits to the Participant:
(1) If the designated Beneficiary is
other than the Participant's spouse, distribution to such Beneficiary shall
generally be made within one (1) year of the Participant's date of death; or
(2) If the designated Beneficiary is the
Participant's spouse, distribution to such Beneficiary shall generally be made
by the date on which the Participant would have attained age seventy and
one-half (70-1/2), subject to the provision that, if the applicable rule
described in Section 6.4(d)(1) or (2) is not complied with, distribution of the
Participant's entire benefit shall be made within five (5) years of the
Participant's death.
6.5 Earnings On Accounts Of Terminated Participants:
Where the distribution of a Participant's Account(s) is
delayed, such Account(s) shall continue to share in the Trust Fund earnings
(and losses) until the date of distribution.
6.6 Latest Benefit Commencement Date:
Subject to Section 6.4(c), unless otherwise elected by a
Participant, the payment of benefits under the Plan shall be made no later than
the sixtieth (60th) day after the close of the Plan Year in which the latest of
the following events occurs:
(a) Normal Retirement Date: The Participant's
Normal Retirement Date,
(b) Ten Years of Participation: The tenth (10th)
anniversary of the year in which the Participant commenced participation in the
Plan, or
(c) Termination: The Participant's Separation
from Service Date.
6.7 Rehire Of Former Plan Participant:
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<PAGE> 43
In the event that a Former Participant who is entitled to
receive a distribution under the Plan is rehired by the Company or an
Affiliated Company prior to receiving such distribution, the distribution shall
be delayed until he or she again terminates employment with the Company or an
Affiliated Company. Upon reemployment, such Employee may again become an
active Participant under the provisions of Section 2.4.
6.8 Precedence Of Code Section 401(a)(9):
The provisions of this Section 6 are intended to comply with
the requirements of Code Section 401(a)(9) and regulations thereunder. If
there is any discrepancy between the provisions of this Section 6 and the
provisions of Code Section 401(a)(9) and regulations thereunder, such
discrepancy shall be resolved in such a way as to give full effect to Code
Section 401(a)(9) and regulations thereunder.
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<PAGE> 44
SECTION 7
Designation Of Beneficiary
7.1 General:
Subject to Section 7.3 below, each Participant may designate
in writing, in a form and manner acceptable to the Committee, a Beneficiary or
Beneficiaries to receive the benefits payable under the Plan by reason of his
or her death. Also subject to Section 7.3, Participants shall have the right
to change such designated Beneficiaries by similar notice filed with the
Committee. If the Board fails to designate Committee the Company shall fulfill
responsibilities of the Committee and be the Plan Administrator.
7.2 Absence Of Proper Designation:
Wherever provision is made hereunder for the payment of any
death benefit to the Beneficiary of a Participant, who is not survived by a
properly designated Beneficiary, such benefit shall be paid to the following
classes of survivors or to the Participant's estate, in the listed sequence:
(a) Spouse: Surviving spouse; if none, then
(b) Children: Surviving children, including
adopted children, per capita; if none, then
(c) Parents: Surviving parents, share and share
alike; if none, then
(d) Siblings: Surviving brothers and sisters,
share and share alike; if none then
(e) Estate: The estate of such Participant.
7.3 Consent Of Spouse:
In the event a Participant is married and designates an
individual other than a spouse as the Beneficiary, Spousal Consent must be on
file with the Committee if such Beneficiary designation is to be honored.
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<PAGE> 45
SECTION 8
Committee
8.1 Appointment:
The Board shall appoint a Committee of at least three (3)
members to hold office at the pleasure of the Board. In the event of the death
or resignation, termination or expiration of the term of any member of the
Committee, a successor shall be appointed by the Board; provided, however, that
the Board shall have the right, at any time and from time to time, to vest in
the remaining members of the Committee the power and authority to appoint such
successor, and provided further that any vacancy in the Committee unfilled for
sixty (60) days may be filled by majority vote of the remaining members of the
Committee.
8.2 Officers And Agents:
The Committee shall appoint a Chairman from among its members
and shall appoint a Secretary and such counsel, consultants and agents (who
need not be members of the Committee) and such advisory, clerical and other
services as may be necessary for the effective performance of its duties
hereunder, and may delegate to any such officer, counsel, consultant or agent
such powers and duties of the Committee, whether ministerial or discretionary,
as the Committee may deem advisable and appropriate.
8.3 Actions:
The Committee may act by a majority of its members then in
office, whether by vote at a meeting or in writing without a meeting. The
Secretary shall keep minutes of the Committee's proceedings and all dates,
records and documents pertaining to the Committee's administration of the Plan.
The Chairman or the Secretary of the Committee may execute any certificate or
other communication or document on behalf of the Committee, or the Committee
may give written authority to one or more of its members to execute and
deliver, in the name of the Committee and for and on its behalf, communications
and documents which the Committee is required or authorized to execute and
deliver under this Plan.
8.4 Conflict Of Interest:
No member of the Committee shall have any right to vote on or
determine any matters relating solely to himself or solely to his or her rights
and benefits under the Plan.
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8.5 Compensation:
No bond or other security shall be required of any member of
the Committee except as may be required by law. No fees or compensation shall
be paid to any member of the Committee for his service as such. All costs and
expenses incurred by the Committee in the performance or exercise of any its
obligations or powers hereunder, and all fees, charges and compensation of any
counsel, consultant or agent employed by the Committee pursuant to Section 8.2
hereof shall be charged to and paid by the Company to the extent not paid by
the Trust.
8.6 Fiduciaries:
In the exercise of any discretion, the Committee shall act as
Fiduciaries on behalf of the Participants in the Plan and shall act on a
nondiscriminatory basis.
8.7 Powers And Duties:
Except where this Plan or related Trust Agreement requires
particular action to be taken by the Company, the Board, the Trustee or an
investment manager as defined in Section 3(38) of ERISA, the Committee shall
have the duty and authority to determine eligibility for benefits, to control
and direct the administration of the Plan, to control and direct the investment
of the Trust Fund, and to interpret and construe the provisions of the Plan and
Trust insofar as the same relate to the administration of the Plan, and to
decide any disputes which may arise with regard to the rights of Employees,
former Employees, Participants, Former Participants or Beneficiaries and their
respective legal representatives. The Committee shall have all of the duties
and powers specifically set forth and conferred upon it elsewhere in the Plan
and Trust Agreement, but such specific references shall not be deemed to be in
limitation of the general duty and authority of the Committee with respect to
the management and operation of the Plan. In particular, the Committee shall
have the power to delegate their investment duties and powers to an investment
manager, if provided for in the Trust Agreement.
8.8 Information From The Company:
To enable the Committee to perform its functions the Company
shall supply full and timely information to the Committee on all matters
relating to the compensation of all Employees and Participants, of their
retirement, disability, death, or other cause for termination of service, and
such other pertinent information as the Committee may require; and the
Committee shall advise the Trustee of such of the foregoing information as may
be required hereunder by the Trustee.
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8.9 Effect:
Subject to Section 8.10, any decision or determination of the
Committee in matters within the scope of its authority and not inconsistent
with the provisions of the Plan and Trust shall be final, binding and
conclusive upon any Employee, former Employee, Participant, Former Participant,
Beneficiaries, their respective legal representatives, or any other person
interested or concerned.
8.10 Claims Procedure:
(a) Claims for Plan Benefits: Distribution under
the Plan will normally be made without a Participant (or Beneficiary) having to
file a claim for benefits. However, a Participant (or Beneficiary) who does
not receive a distribution to which he or she believes he or she is entitled
may present a claim to the Committee for any unpaid benefits in accordance with
the procedure described in the balance of this Section 8.10.
(b) Applications for Benefits: All applications
for benefits under the Plan shall be submitted to the Committee. Applications
for benefits must be in writing and must be signed by the Participant, or in
the case of a death benefit, by his or her Beneficiary or legal representative.
The Committee reserves the right to require proof of age prior to processing
any application. Each application shall be acted upon and approved or
disapproved within sixty (60) days following its receipt by the Committee. In
the event any application for benefits is denied, in whole or in part, the
Committee shall notify the applicant in writing of such denial and of his or
her right to a review by the Committee and shall set forth, in a manner
calculated to be understood, specific reasons for such denial, specific
references to pertinent Plan provisions on which the denial is based, a
description of any additional material or information necessary to perfect the
application, an explanation of why such material or information is necessary,
and an explanation of the Plan's review procedure.
(c) Denial of Application: If the application
for benefits is denied is whole or in part, the applicant may appeal to the
Committee for a review of the decision by submitting to the Committee within
sixty (60) days after receiving written notice of the denial of his claim, a
written statement:
(1) requesting a review of the
application for benefits by the Committee;
(2) setting forth all of the grounds
upon which the request for review is based and any fact in support thereof, and
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(3) setting forth any issues or comments
which the applicant deems pertinent to his application.
(d) Committee Review: The Committee shall act
upon each application within sixty (60) days after receipt of the applicant's
request for review, provided that, if warranted by special circumstances, the
Committee may have an additional sixty (60) days to make its determination.
The Committee shall make a full and fair review of each such application and
any written materials submitted by the applicant or the Company in connection
therewith and may require the Company or the applicant to submit such
additional facts, documents, or other evidence as the Committee, in its sole
discretion, deems necessary or advisable in making such a review. On the basis
of its review, the Committee shall make an independent determination of the
applicant's eligibility for benefits under the Plan. The decision of the
Committee on any application for benefits shall be final and conclusive upon
all persons if supported by any substantial evidence in the record.
(e) Written Notice of Final Denial: In the event
the Committee denies an application in whole or in part, written notice of its
decision shall be given to the applicant setting forth in a manner calculated
to be understood by the applicant the specific reasons for such denial and
specific reference to the pertinent Plan provisions on which the decision was
based.
8.11 Indemnification:
The Company agrees to indemnify and hold harmless the
Committee and each of its members against any and all claims, losses, damages,
expenses and liabilities the Committee may incur in the exercise and
performance of the Committee's powers and duties hereunder, unless the same are
determined to be due to gross negligence or willful misconduct.
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SECTION 9
The Trust Agreement
9.1 General Responsibilities Of The Trustee:
All contributions under the Plan will be made into a Trust
Fund held by a Trustee appointed by the Company. The Trustee shall invest and
hold contributions to the Trust Fund and the income and gains therefrom in
accordance with the terms of the Plan and Trust Agreement. Distributions under
the Plan will be drawn from the Trust Fund and paid by the Trustee as directed
in writing by the Committee.
9.2 Appointment Of Investment Manager:
The Board, by appropriate action, may appoint an investment
manager, as defined in Section 3(38) of ERISA, to direct the investment and
management of all or part of the assets of the Trust. A certified copy of any
such Board resolution shall be provided to the Trustee whereupon the investment
and management of such designated Trust Fund and the Trustee shall have no
responsibility therefor. Any transfer of investment manager may be revoked
upon receipt by the Trustee of a notice to that effect from the Board.
9.3 Right To Invest In Company Stock:
The Trustee may, without limitation, acquire and hold
qualified employer securities and/or qualifying employer real property (as
defined under Sections 407(d) and 407(e) of ERISA).
9.4 Group Or Common Trusts:
The Trustee is hereby authorized to invest Plan assets in
group or common trust funds. In the event of such an investment, the group or
common trusts shall be adopted and considered as part of the Plan for so long
as such group or common trust remains qualified under Code Section 401(a) and
exempt from taxation under Code Section 501(a) in accordance with Revenue
Ruling 81-100, as the same may be amended or restated from time to time.
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SECTION 10
Rights Of Participants
10.1 Participants' Rights To Plan Benefits:
No Participant or Beneficiary shall have any right or claim to
benefits under the Plan except in accordance with the provisions of the Plan
and then only to the extent that there are funds available therefor in the
hands of the Trustee.
10.2 Employment Rights Under The Plan:
Nothing contained in the Plan shall be deemed to give any
Employee the right to be retained in the services of the Company.
10.3 Assignment Of Rights:
The right of any Participant or his Beneficiary in any benefit
hereunder shall not be subject to alienation, assignment or transfer,
voluntarily or involuntarily, by operation of law or otherwise, except as
expressly permitted herein. No Participant shall assign, transfer, or dispose
of such right, nor shall any such right be subjected to attachment, execution,
garnishment, sequestration, or other legal, equitable or other process, unless
the assignment of such benefit or right is pursuant to a "qualified domestic
relations order" as defined at Section 414(p) of the Code and related
regulations and as provided in Section 10.4.
In the event a Participant's benefits are attached by the
order of any court, the Committee may bring an action for a declaratory
judgment in a court of competent jurisdiction to determine the proper recipient
of the benefits to be paid by the Plan. During the pendency of the action, the
Committee shall cause any benefits payable to be paid to the court for
distribution by the court as it considers appropriate.
Upon receipt of a domestic relations order related to the
benefit of a Plan Participant, the Committee shall promptly notify the
Participant and proposed alternate payee of its receipt of the Order. In
addition, the Committee shall adopt nondiscriminatory procedures, in accordance
with the requirements of the Code, to determine whether a domestic relations
order received by the Committee is a "qualified domestic relations order" as
defined in Section 414(p) of the Code.
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10.4 Qualified Domestic Relations Orders:
The Committee may direct the Trustee to comply with a
qualified domestic relations order. Upon receipt of any judgment, decree or
order (including approval of a property settlement agreement) relating to the
provision of payment by the Plan to an alternate payee, the Committee shall
promptly notify the Participant and any alternate payee of the receipt of such
judgment, decree or order and of the Committee's procedure for determining
whether or not the judgment, decree or order is a qualified domestic relations
order.
The Committee shall establish a written procedure to determine
the status of a judgment, decree or order and shall permit the alternate payee
to designate a representative for receipt of communications from the Committee
and shall include such other provisions as the Committee shall determine,
including provisions required under regulations promulgated by the Secretary of
the Treasury.
During any period in which the issue of whether a judgment,
decree or order is a qualified domestic relations order is being determined by
the Committee, a court of competent jurisdiction or otherwise, the Committee
shall segregate in a separate account the amount, if any, that would be payable
to the alternate payee if the judgment, decree or order is determined to be a
qualified domestic relations order. Such account shall not be increased by
Plan contributions, but shall be invested as directed by the Committee and
credited with the gains and losses of such investment.
If the judgment, decree or order is determined to be a
qualified domestic relations order within the 18-month period following its
receipt by the Committee, then payment from the segregated account shall be
made to the alternate payee within a reasonable time or, at the alternate
payee's election, maintained in the Plan. In the latter instance, the
alternate payee shall have the right to make investment elections in the same
manner as other Participants. In no event shall a distribution to an alternate
payee cause a Participant's vested interest in his Accounts to increase.
If the judgment, decree or order is determined to not be a
qualified domestic relations order or if no such determination is made during
the 18-month period following its receipt by the Committee, the segregated
account shall be returned to the Participant's Accounts and shall be paid at
the time and manner provided under the Plan as if no judgment, decree or order
had been received by the Committee.
A distribution to an "alternate payee" shall be permitted if
such distribution is authorized by a QDRO even if the affected Participant has
not separated from service and has not reached the earliest retirement age
under the Plan.
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10.5 Incompetency:
If a Participant or Beneficiary to whom benefits shall be due
under the Plan shall be or become incompetent either physically or mentally, in
the judgment of the Committee, the Committee shall have the right to determine
to whom such benefit shall be paid for the benefit of such Participant or
Beneficiary, and the Committee's determination shall be binding on all parties.
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SECTION 11
Amendment Of Plan
11.1 Right To Amend Plan:
By resolution adopted at a meeting or by unanimous written
consent, the Board may at any time amend, in whole or in part, any or all of
the provisions of this Plan; provided, however, that no such amendment shall
authorize or permit, at any time prior to the satisfaction of all liabilities
in respect of the Participants or Beneficiaries under the Plan, any part of the
Trust Fund to be used for or diverted to purposes other than for their
exclusive benefit and provided further that no amendment shall reduce any
benefit or eliminate any payment option under the Plan in effect on the date
the amendment is adopted.
This Plan may be partially amended or modified at any time by
the Committee provided, however, that (i) the Committee shall refer to the
Board of Directors any such amendment which would, in the Committee's
reasonable determination, result in an increase in the costs of funding plan
benefits unless such amendment results from changes in applicable laws or
regulations; (ii) no such amendment shall materially affect the powers, duties
and responsibilities of the Committee; and (iii) notwithstanding any such power
to amend, the Board of Directors shall continue to hold the power and authority
at any time independently to amend the Plan and the Trust Agreement.
11.2 Protection Of Participants' Rights:
(a) No Decrease of Vested Percentage: No
amendment of the Plan may decrease the vested percentage of any Participant.
Should the Plan be amended to change its vesting schedule, any Participant with
at least three (3) Years of Service for vesting purposes may elect to have his
vested percentage computed under the Plan without regard to such future
amendment. Such election must be made within sixty (60) days after the latest
of the following:
(1) The date the Plan amendment is
adopted,
(2) The date the Plan amendment becomes
effective, or
(3) The date the Participant is issued
written notice of the Plan amendment by the Company or Committee.
(b) No Decrease of Benefit: The Accounts of any
Participant may not be decreased by amendment of this Plan.
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11.3 Mergers, Consolidations And Transfers:
This Plan shall not be merged into or consolidated with any
other plan, nor shall any of its assets or liabilities be transferred to any
other plan, unless each Participant would (if such other plan then terminated)
receive a benefit immediately after the merger, consolidation, or transfer
which is equal to or greater than the benefit he would have been entitled to
receive immediately before the merger, consolidation, or transfer (if this Plan
had then terminated).
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SECTION 12
Termination Of Plan
12.1 General:
The Company has established the Plan with the bona fide
intention and expectation that it will be able to make contributions thereto
indefinitely, but the Company is not and shall not be under any obligation or
liability whatsoever to continue its contributions and may discontinue such
contributions or terminate the Plan at any time without any liability
whatsoever for such discontinuance or termination. The Plan shall terminate
upon the dissolution of the Company unless, upon such dissolution, a successor
to the Company elects to continue the Plan.
12.2 Distribution:
Upon termination of the Plan, partial termination of the Plan
or complete discontinuance of contributions under the Plan, each affected
Participant's Company Matching Contribution Account and Company Contribution
Account shall immediately vest in full and be nonforfeitable, and the Committee
shall revalue the assets of the Trust and the Accounts of each Participant as
of the date of termination or discontinuance of contributions, and, after
satisfying current obligations of the Plan and setting aside funds for
anticipated future obligations of the Plan, shall allocate all unallocated
assets to the Accounts of the Participants at the date of termination, in the
proportion that the value of the Accounts of each individual Participant bears
to the aggregate value of all such Accounts as of such date. The Trustee shall
then pay over to each affected Participant, in accordance with the instructions
of the Committee, the net value of his Accounts. In the event of such
termination, after payment of all expenses, all assets of the Trust shall be
used for the exclusive benefit of Participants and their Beneficiaries, as
their interests may appear in accordance with the terms of this Plan. In no
event, except to provide for the satisfaction of all liabilities under the
Plan, may any part of the Trust be used for or diverted to, purposes other than
for the exclusive benefit of Participants and Beneficiaries.
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SECTION 13
Top Heavy Plan
13.1 Precedence Of Section:
Anything in this Plan to the contrary notwithstanding, the
provisions of this Section 13 shall supersede and take precedence over any
other provisions of the Plan for any Plan Year in which the Plan is determined
to be a Top Heavy Plan as determined under Section 13.3.
13.2 Definitions:
For purposes of determining whether the Plan is a Top Heavy
Plan for any Plan Year, the following terms, wherever capitalized, shall have
the meaning set forth below:
(a) Determination Date: "Determination Date"
means the date on which the Plan is tested to determine if it is a Top Heavy
Plan, which date shall generally be the last day of the Plan Year preceding the
Plan Year for which the determination is being made.
(b) Key Employee: "Key Employee" means an
Employee (or the Beneficiary of an Employee) who, at any time during a Plan
Year or any of the four (4) preceding Plan Years, is or was:
(1) Officer: An officer of the Company
(but not more than fifty (50) Employees of the Company shall be considered
officers for this purpose) whose annual Compensation is at least $51,291 or
such greater amount as may be recognized for increases in the cost of living in
accordance with Code Section 416(i)(1)(A)(i).
(2) Employee Owner: One (1) of the ten
(10) Employees owning the largest interest in the Company provided that his
ownership interest is at least one-half of one percent (0.5%) of the Company,
and his annual Compensation is at least $30,000 or such greater amount as may
be recognized for increases in the cost of living in accordance with Code
Section 416(i)(1)(A)(ii) (for purposes of this Section 13.2(b)(2), if two (2)
Employees have the same interest in the Company, the Employee with the greater
annual Compensation shall be treated as having larger interest),
(3) Five Percent Shareholder: An
Employee who is an owner of more than five percent (5%) of the Company or an
Affiliated Company, or
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(4) Highly Compensated Shareholder: An
Employee who is an owner of more than one percent (1%) of the Company or an
Affiliated Company and who has annual Compensation in excess of $150,000.
(c) Former Key Employee: "Former Key Employee"
means a Participant in the Plan who, at any time during the four (4) preceding
Plan Years, was a Key Employee but who is not a Key Employee in the current
Plan Year, or who terminated his service with the Company or an Affiliated
Company in one of the four (4) preceding Plan Years and was not a Key Employee
in the Plan Year in which he terminated.
(d) Non-Key Employee: "Non-Key Employee" means a
Participant in the Plan who, at any time during the current Plan Year, is
neither a Key Employee nor a Former Key Employee.
(e) Top Heavy Plan: "Top Heavy Plan" means a
Plan which is determined to be a Top Heavy Plan for a Plan Year, as described
in Section 13.3.
(f) Valuation Date: "Valuation Date" means the
last day of a Plan Year as of which Accounts are valued in order to determine
the top heavy ratio in Section 13.3.
13.3 Determination Of Top Heavy Plan:
With respect to any Plan Year, the Plan shall be a Top Heavy
Plan if, as of the applicable Determination Date, the aggregate of the Accounts
of Key Employees (excluding Former Key Employees) under the Plan exceeds sixty
percent (60%) of the aggregate of the Accounts of all Key Employees (excluding
Former Key Employees) and all Non-Key Employees under the Plan. In making such
determination, distributions made from Accounts during the five (5) year period
ending on the Determination Date shall be included and the Accounts of all
individuals who have not performed any services for the Company or an
Affiliated Company during the five (5) year period ending on the Determination
Date shall be excluded. In determining if the Plan is a Top Heavy Plan, it
shall be aggregated with each other plan of the Company or an Affiliated
Company in the required aggregation group as described below and it may be
aggregated with any other Plan of the Company or an Affiliated Company in the
permissive aggregation group as described below. In aggregating such plans,
all of the Determination Dates shall fall within the same calendar year.
Required aggregation group means each qualified plan of the Company or an
Affiliated Company in which at least one Key Employee participates, and any
other qualified plan of the Company or an Affiliated Company which enables each
qualified plan of the Company or an Affiliated Company to meet the requirements
of Sections 401(a)(4) or 410 of the Code. If a required aggregation group is
Top Heavy, then each plan in the required aggregation
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group is a Top Heavy Plan. Permissive aggregation group means any other plan
or plans of the Company or an Affiliated Company which, when considered as a
group with the required aggregation group, would continue to satisfy the
requirements of Section 401(a)(4) and 410 of the Code. If a permissive
aggregation group is Top Heavy, then only the plans that are part of the
required aggregation group are Top Heavy Plans.
13.4 Minimum Benefit Under Top Heavy Plan:
With respect to any Plan Year for which the Plan is determined
to be a Top Heavy Plan, contributions allocated to the Accounts of Participants
who are Non-Key Employees and who are employed by the Company on the
Anniversary Date of the applicable Plan Year shall not be less than the lesser
of:
(a) 3% of Net Compensation: Three percent (3%)
of each such Participant's Net Compensation, or
(b) Company Contribution Totaling Less than 3% of
Net Compensation: If the Company's contribution, including Pre-Tax
Contributions, on behalf of each Key Employee for a Plan Year totals less than
three (3%) of the Net Compensation of each such Participant for such Plan Year,
not less than the highest percentage of Net Compensation which is contributed
by the Company on behalf of a Key Employee including Pre-Tax Contributions, to
the Plan for such Plan Year.
13.5 Maximum Limitation Under Top Heavy Plan:
With respect to any Plan Year for which the Plan is determined
to be a Top Heavy Plan, a 1.0 limitation shall be substituted for the 1.25
limitations in Plan Sections 5.3(d)(1)(B)(i) and 5.3(d)(2)(B)(i).
13.6 Compensation In Top Heavy Plan Year:
With respect to any Plan Year for which the Plan is determined
to be a Top Heavy Plan, Net Compensation shall be limited to $150,000 or such
other amount as prescribed by the Secretary of the Treasury or his delegate.
For purposes of this Section 13, Net Compensation shall be determined under
regulations promulgated under Code Section 415.
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SECTION 14
Withdrawals
14.1 Withdrawals From Rollover or Post-Tax Contribution
Account:
A Participant may request a withdrawal of some portion of his
Rollover or Post-Tax Contribution Account balance by written notice to the
Committee setting forth the amount requested. The balance of a Participant's
Rollover or Post-Tax Contribution Account for this purpose shall be determined
as of the last day of the quarter coinciding with or immediately following the
date of the Participant's request.
Payment of a withdrawal from a Participant's Rollover or
Post-Tax Contribution Account pursuant to this Section 14.1 shall be made from
the Investment Funds on a pro rata basis.
14.2 Withdrawals From Pre-Tax Contribution Account:
(a) Hardship Withdrawals Prior to Age 59-1/2
(safe harbor standard): Any Participant who suffers a financial hardship, as
defined in this Section 14.2(a), may request a withdrawal of some portion of
his Pre-Tax Contribution Account as described herein, by written notice to the
Committee setting forth the amount requested and the facts establishing the
existence of such hardship. Upon receipt of such a request, the Committee
shall determine whether a financial hardship exists; if the Committee
determines that such a hardship does exist, it shall further determine what
portion of the amount requested by the Participant is required to meet the need
created by the hardship (including amounts necessary to pay any federal, state
or local income taxes or penalties reasonably anticipated to result from the
distribution), shall determine the portion, if any, of such Account which is
eligible for withdrawal, and shall direct the Trustee to distribute to the
Participant in a single lump sum payment the amount so determined to be
required, less applicable withholding.
The value of each such Pre-Tax Contribution Account shall be
estimated as of the date of the Participant's request.
The amount available for hardship withdrawal is limited to the
amount the Participant contributed to his or her Pre-Tax Contribution Account
as of the date of distribution reduced by the amount of any previous
distributions made pursuant to this Section.
A Participant who receives a withdrawal pursuant to this
Section 14.2(a) shall be precluded from making Pre-Tax Contributions pursuant
to Section 3.3 for the
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period which begins on the day such withdrawal is received by the Participant
and ends on the first anniversary of the day the withdrawal was received.
Moreover, for the taxable year of the Participant immediately following the
taxable year of the Participant in which the withdrawal was received by the
Participant, the dollar limit described in Section 3.3(b) for such subsequent
taxable year shall be reduced by the aggregate amount of Pre-Tax Contributions
made by the Participant in the taxable year in which the withdrawal was
received.
For purposes of this Section 14.2(a), the term "financial
hardship" means an immediate and heavy financial need arising from:
(i) medical expenses described in Code Section
213(d) incurred by the Participant, the Participant's spouse or any dependents
of the Participant (as defined in Code Section 152) or necessary for these
persons to obtain medical care,
(ii) costs directly related to the purchase
(excluding mortgage payments) of the principal residence of the Participant,
(iii) payment of tuition and related educational
expenses for the next twelve months of post-secondary education for the
Participant, his spouse, children or dependents,
(iv) payments necessary to prevent eviction of the
Participant from his principal residence or foreclosure on the mortgage of the
Participant's principal residence.
The Committee shall not authorize a withdrawal under this
Section 14.2 unless the Participant has obtained all distributions (other than
hardship withdrawals) and all nontaxable loans available to the Participant
(except to the extent such distributions or loans would cause a financial
hardship) under all qualified plans maintained by the Company or an Affiliated
Company.
(b) Hardship Withdrawals Prior to Age 59-1/2
(General Standard).
Any Participant whose situation does not constitute a
financial hardship due to a failure to meet one of the safe harbor events test
requirements set forth in Section 14.2(a)(i) through (iv), may make written
request to the Committee for a hardship withdrawal based upon the events test
general standard. The Committee will use the needs test safe harbor to
determine that financial need cannot be satisfied.
Under the events test general standard, the Participant must
submit and the Committee will consider all relevant facts and circumstances in
evaluating whether or not
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there exists an immediate and heavy financial need. Among the factors
considered by the Committee:
o Does an actual immediate "need" exist, which if
unfulfilled will greatly decrease the Participant's
quality of life (e.g., payment of funeral expenses
for a family member or have repairs due to financial
disaster).
o Will the requested hardship withdrawal solve the need
on a more or less permanent basis or will the
withdrawal only provide a temporary solution.
(c) Withdrawals After Age 59-1/2: Any
Participant who has attained age 59-1/2 while a Participant may request a
withdrawal of all or a part of his Pre-Tax Contribution Account, whether or not
he has suffered a financial hardship, by written notice to the Committee. The
value of each such Pre-Tax Contribution Account shall be determined as soon as
administratively possible following receipt of completed and executed forms and
appropriate approval.
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SECTION 15
Construction And Enforcement Of Plan
15.1 Governing Legal Entity:
The Plan shall be construed, administered and enforced
according to the laws of the United States and the laws of the State of
California, to the extent the latter are not preempted by the former.
15.2 Text To Control:
The headings of the sections and subsections are included
solely for convenience of reference and, if there is any conflict between such
headings and the text of this Plan, the text shall control.
15.3 Gender:
The masculine pronoun wherever used includes the feminine
pronoun.
15.4 Severability:
In the event any provision of this Plan shall be considered
illegal or invalid for any reason, said illegality or invalidity shall not
affect the remaining provisions of this Plan, but shall be fully severable, and
the Plan shall be construed and enforced as if said illegal or invalid
provisions had never been inserted therein.
15.5 Liability:
All benefits payable under the Plan shall be paid or provided
for solely as provided in the Plan and Trust Agreement and the Company assumes
no liability or responsibility therefor.
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METROBANK
EMPLOYEE SAVINGS PLAN
FIRST AMENDMENT
As provided in Section 11, Metrobank Employee Savings Plan is
hereby amended effective January 1, 1989 as follows:
Section 3.7
Section 3.7(c) is amended by addition of the following:
Any such Special Company Contribution will be taken into
account under the ADP test only to the extent it relates to
Compensation that would have been received or is attributable to
services performed by the Participant in a Plan Year and but for an
exception to defer would have been paid within 2-1/2 months after the
close of the Plan Year.
Section 3.7
Section 3.7 is amended by addition of Section (g) as follows:
(g) Tax: Excess contributions plus any income and minus any
loss allocable thereto, shall be distributed no later than the last
day of each Plan Year to Participants to whose accounts such excess
contributions were allocated for the preceding Plan Year. If such
excess amounts are distributed more than 2-1/2 months after the last
day of the Plan Year in which such excess amounts arose, a 10% excise
tax will be imposed on the Employer.
Section 6.3
Section 6.3 is amended by designating section 6.3(b) as
section 6.3(a)(6) and by adding a new section (b) to read as follows:
(b)(1) Unless otherwise elected as provided below, a vested
Participant who dies before the annuity starting date and who has a
surviving spouse shall have his death benefit paid to his surviving
spouse in the form of a Pre-Retirement Survivor Annuity. The
Participant's spouse may
<PAGE> 64
direct that payment of the Pre-Retirement Survivor Annuity commence
within a reasonable period after the Participant's death. If the
spouse does not so direct, payment of such benefit will commence at
the time the Participant would have attained the later of his Normal
Retirement Age or age 62. However, the spouse may elect a later
commencement date.
(2) Any election to waive the Pre-Retirement Survivor
Annuity before the Participant's death must be made by the Participant
in writing during the election period and shall require the spouse's
irrevocable consent in the same manner provided for in Section
6.3(a)(2). Further, the spouse's consent must acknowledge the
specific nonspouse Beneficiary. Notwithstanding the foregoing, the
nonspouse Beneficiary need not be acknowledged, provided the consent
of the spouse acknowledges that the spouse has the right to limit
consent only to a specific Beneficiary and that the spouse voluntarily
elects to relinquish such right. A spouse who has consented to waive
the Pre-Retirement Survivor Annuity, may revoke such election at any
time and any number of times during the period between the first day
of the Plan Year in which the Participant reaches age 35 and the date
of the Participants death.
(3) The election period to waive the Pre-Retirement
Survivor Annuity shall begin on the first day of the Plan Year in
which the Participant attains age 35 and end on the date of the
Participant's death. An earlier waiver (with spousal consent) may be
made provided a written explanation of the Pre-Retirement Survivor
Annuity is given to the Participant and such waiver becomes invalid at
the beginning of the Plan Year in which the Participant turns age 35.
In the event a vested Participant separates from service prior to the
beginning of the election period, the election period shall begin on
the date of such separation from service.
(4) With regard to the election, the Administrator shall
provide each Participant within the applicable period, with respect to
such Participant (and consistent with Regulations), a written
explanation of the Pre-Retirement Survivor Annuity containing
comparable information to that required pursuant to Section 6.3(a).
For the purposes of this paragraph, the term "applicable
2
<PAGE> 65
period" means, with respect to a Participant, whichever of the
following periods ends last:
(i) The period beginning with the first day of
the Plan Year in which the Participant attains age 32 and
ending with the close of the Plan Year preceding the Plan Year
in which the Participant attains age 35;
(ii) A reasonable period after the individual
becomes a Participant;
(iii) A reasonable period ending after the Plan no
longer fully subsidizes the cost of the Pre- Retirement
Survivor Annuity with respect to the Participant;
(iv) A reasonable period ending after Code Section
401(a)(11) applies to the Participant; or
(v) A reasonable period after separation from
service in the case of a Participant who separates before
attaining age 35. For this purpose, the Administrator must
provide the explanation beginning one year before the
separation from service and ending one year after such
separation. If such a Participant thereafter returns to
employment with the Employer, the applicable period for such
Participant shall be redetermined.
For purposes of applying this Section 6.3(b)(4), a reasonable
period ending after the enumerated events described in paragraphs
(ii), (iii) and (iv) above is the end of the two year period beginning
one year prior to the date the applicable event occurs, and ending one
year after that date.
(5) In the event the death benefit is not paid in the
form of a Pre-Retirement Survivor Annuity, it shall be paid to the
Participant's Beneficiary by either of the following methods, as
elected by the Participant (or if no election has been made prior to
the Participant's death, by his Beneficiary), subject to the rules
specified in Section 6.3(b)(6):
3
<PAGE> 66
(i) One lump-sum payment in cash;
(ii) Payment in monthly, quarterly, semi-annual,
or annual cash installments over a period to be determined by
the Participant or his Beneficiary. After periodic
installments commence, the Beneficiary shall have the right to
direct the Trustee to reduce the period over which such
periodic installments shall be made, and the Trustee shall
adjust the cash amount of such periodic installments
accordingly.
(6) Notwithstanding any provision in the Plan to the
contrary, distributions upon the death of a Participant shall be made
in accordance with the following requirements and shall otherwise
comply with Code Section 401(a)(9) and the Regulations thereunder. If
it is determined pursuant to Regulations that the distribution of a
Participant's interest has begun and the Participant dies before his
entire interest has been distributed to him, the remaining portion of
such interest shall be distributed at least as rapidly as under the
method of distribution selected pursuant to Section 6.3(b) as of his
date of death. If a Participant dies before he has begun to receive
any distributions of his interest under the Plan or before
distributions are deemed to have begun pursuant to Regulations, then
his death benefit shall be distributed to his Beneficiaries by
December 31st of the calendar year in which the fifth anniversary of
his date of death occurs.
4
<PAGE> 67
METROBANK
EMPLOYEE SAVINGS PLAN
SECOND AMENDMENT
Pursuant to Section 11 of the Metrobank Employee Savings Plan (the "Plan")
governing document, the Plan is hereby amended effective January 1, 1996 as set
forth below:
1. Section 3.1(a) of the Plan is amended to read as follows:
"(a) Matching Contribution: The Company
shall contribute to the Trust for each Plan Year
on behalf of each Participant for whom it makes
Pre-Tax Contributions for such Plan Year matching
contributions in the form of cash (herein called
"Matching Contributions") equal to 50% of that
portion of each Participant's aggregate Pre-Tax
Contributions which do not exceed 5% of those
components (e.g., base salary, bonuses) of such
Participant's Compensation for the Plan Year
which are selected by the Participant as the
source of the Participant's Pre-Tax Contributions
for such Plan Year; provided, however, that with
respect to Pre-Tax Contributions made between
<PAGE> 68
January 1, 1996 and June 30, 1996, no Participant
shall receive aggregate Matching Contributions in
excess of $850. Matching Contributions shall be
allocated to Company Matching Contribution
Accounts."
2. Section 6.1(b)(2) of the Plan is hereby amended by the addition of the
following new paragraph as the last paragraph of Section 6.1(b)(2):
"Notwithstanding the foregoing provisions of
this Section 6.1(b), the interests of all
Participants of the Plan who are employed by the
Company on January 1, 1996 in their Company
Matching Contribution Accounts shall become fully
vested as of that date. Further, the interests
of Participants in Matching Contributions made by
the Company during 1996 and later years shall be
fully vested at the time of allocation to any
Participant's Company Matching Contributions
Account."
<PAGE> 1
Exhibit 5.1
John P Sheridan
Vice President - Corporate Legal
One Detroit Center
500 Woodward Avenue, 33rd Floor
Detroit, Michigan 48226
January 24, 1996
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: COMERICA INCORPORATED - REGISTRATION STATEMENT ON FORM S-8
Dear Sir/Madam:
I am Vice President and counsel to Comerica Incorporated, a Delaware
corporation (the "Company"). This opinion is being rendered with respect to the
Registration Statement on Form S-8 filed by the Company with the Securities and
Exchange Commission for the purpose of registering under the Securities Act of
1933 (the "Act"), as amended, 10,000 shares of the Company's Common Stock,
$5.00 par value (the "Shares"), which will have attached to them rights (the
"Rights") to acquire Series C Preferred Stock or, under certain circumstances,
Common Stock or other assets, all as more fully described in that certain
Rights Agreement and the amendment thereto incorporated by reference into the
Registration Statement as Exhibits 4.3 and 4.4, respectively (collectively, the
"Rights Agreement"), between the Company and Comerica Bank, as Rights Agent.
The Shares and the Rights are to be issued under the Metrobank Employee Savings
Plan (the "Plan") which was assumed by
<PAGE> 2
Securities and Exchange Commission
Page Two
the Company in connection with its acquisition of the Metrobank, a California
banking corporation.
I have examined such certificates, instruments, and documents and reviewed
such questions of law as I have considered necessary or appropriate for the
purposes of this opinion, and, on the basis of such examination and review, I
advise you that, in my opinion:
1. The Shares have been duly authorized and, when issued in accordance
with the terms of the Plan, will be legally issued, fully paid, and
nonassessable.
2. The Rights have been duly authorized and, when issued in accordance
with the terms of the Plan and the Rights Agreement, will be legally issued.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving this consent, I do not thereby admit that I
am within the category of persons whose consent is required under Section 7 of
the Act or the rules and regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/S/John P. Sheridan
John P. Sheridan, Esquire
Vice President
Comerica Incorporated
Detroit, Michigan 48226
(313) 222-6160
JPS/tkw
<PAGE> 1
Exhibit 5.2
INTERNAL REVENUE SERVICE DEPARTMENT OF THE TREASURY
DISTRICT DIRECTOR
450 GOLDEN GATE AVENUE, MS 7-4-01
SAN FRANCISCO, CA 94102
Employer Identification Number:
Date: November 9, 1995 95-3271474
File Folder Number:
331012263
METROBANK Person to Contact:
19191 S VERMONT AVENUE NANCY MAYO
TORRANCE, CA 90502 Contact Telephone Number:
(415) 556-0358
Plan Name:
METROBANK
EMPLOYEE SAVINGS PLAN
Plan Number: 002
Dear Applicant:
We have made a favorable determination on your plan, identified above,
based on the information supplied. Please keep this letter in your permanent
records.
Continued qualification of the plan under its present form will depend on
its effect in operation. (See section 1.401-1(b)(3) of the Income Tax
Regulations.) We will review the status of the plan in operation periodically.
The enclosed document explains the significance of this favorable
determination letter, points out some features that may affect the qualified
status of your employee retirement plan, and provides information on the
reporting requirements for your plan. It also describes some events that
automatically nullify it. It is very important that you read the publication.
This letter relates only to the status of your plan under the Internal
Revenue Code. It is not a determination regarding the effect of other federal
or local statutes.
This determination is subject to your adoption of the proposed amendments
submitted in your letter dated March 30, 1995. The proposed amendments should
be adopted on or before the date prescribed by the regulations under Code
section 401(b).
This determination is also subject to your adoption of the proposed
amendments submitted in your letter(s) dated November 6, 1995. These proposed
amendments should also be adopted on or before the date prescribed by the
regulations under Code section 401(b).
This plan has been mandatorily disaggregated, permissively aggregated, or
restructured to satisfy the nondiscrimination requirements.
This letter is issued under Rev. Proc. 93-39 and considers the amendments
required by the Tax Reform Act of 1986 except as otherwise specified in this
letter.
This plan satisfies the nondiscriminatory current availability
requirements of section 1.401(a)(4)-4(b) of the regulations with respect to
those benefits, rights, and features that are currently available to all
employees in the plan's coverage group. For this purpose, the plan's coverage
group consists of those employees treated as currently benefiting for purposes
of demonstrating that the plan satisifies the minimum coverage requirements of
section 410(b) of the Code.
<PAGE> 2
METROBANK
This letter may not be relied upon with respect to whether the plan
satisfies the qualification requirements as amended by the Uruguary Round
Agreements Act, Pub. L. 103-465.
The information on the enclosed addendum is an integral part of this
determination. Please be sure to read and keep it with this letter.
We have sent a copy of this letter to your representative as indicated in
the power of attorney.
If you have questions concerning this matter, please contact the person
whose name and telephone number are shown above.
Sincerely yours,
Richard R. Orosco
District Director
Enclosures:
Publication 794
Addendum
This plan also satisfies the requirements of Code section 401(k).
<PAGE> 1
Exhibit 23.1
CONSENT OF ERNST AND YOUNG, LLP,
INDEPENDENT AUDITORS
We consent to the incorporation by reference in the Registration Statement on
Form S-8 of Comerica Incorporated, pertaining to the registration of 10,000
shares of common stock with respect to the Metrobank Employee Savings Plan, of
our report dated January 17, 1995, with respect to the consolidated financial
statements of Comerica Incorporated, incorporated by reference in the Annual
Report (Form 10-K) for the year ended December 31, 1994, filed with the
Securities and Exchange Commission.
January 16, 1996 /S/Ernst & Young LLP
