<PAGE>
FORM S-8
Registration Statement Under The Securities Act of 1933
Torchmark Corporation
(Exact name of registrant as specified in its charter)
Delaware 63-0780404
(State or other jurisdiction (I.R.S. Employer
or incorporation or Identification No.)
organization)
2001 Third Avenue South, Birmingham, Alabama 35233
(Address of Principal Executives Offices) (Zip Code)
Liberty National Life Insurance Company 401(k) Plan
(Full title of the plan)
William C. Barclift
Executive Vice President, General Counsel & Secretary
Liberty National Life Insurance Company
2001 Third Avenue South
Birmingham, AL 35233
(Name and address of agent for service)
(205) 325-2780
(Telephone number, including area code, of agent for service)
Calculation of Registration Fee
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
Titles of Amount to be Proposed Proposed Amount
Securities to registered maximum maximum of
be registered offering aggregate offering registration
price per unit/1/ price fee
- ------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Torchmark Corporation 200,000 $44 $8,800,000 $3,034.48
Common Stock shares
</TABLE>
In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
Registration Statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan described herein.
- ---------------
/1/Calculated pursuant to Rule 457(c) and (h)(1) based upon the average of the
high and low prices reported for Torchmark Corporation common stock in the
consolidated reporting system on December 21, 1995.
<PAGE>
PART II
Information Required in the Registration Statement
Item 3. Incorporation of Documents by Reference
Torchmark Corporation (the "Registrant" or the "Company") and the
Liberty National Life Insurance Company 401(k) Plan (the "Plan") hereby
incorporate by reference into this Registration Statement the following
documents:
(a)(1) Registrant's latest annual report on Form 10-K filed pursuant
to Section 13(a) of the Securities Exchange Act of 1934 for the
most recent fiscal year
(a)(2) The Plan's latest annual annual report on Form 11-K filed
pursuant to Section 15 (d) of the Securities Exchange Act of
1934 for the most recent fiscal year
(b) All other reports filed pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 since the end of the fiscal
year covered by the Registrant document referenced to in (a)
above
(c) The description of Registrant's common stock contained in the
Form 10 Registration Statement filed under the Securities and
Exchange Act of 1934, including any amendment or report filed
for the purpose of updating such description.
All documents subsequently filed by the Registrant or the Plan
pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act
of 1934, prior to the filing of a post-effective amendment which indicates that
all securities offered have been sold or which deregisters all securities then
remaining unsold, shall be deemed to be incorporated by reference in the
Registration Statement and to be a part thereof from the date of filing of such
documents.
Item 4. Description of Securities.
The class of securities to be offered is registered under Section 12 of the
Securities Exchange Act of 1934.
Item 5. Interests of Named Experts and Counsel.
Not Applicable.
Item 6. Indemnification of Directors and Officers.
Section 1 of Article Ninth of the Restated Certificate of Incorporation of
the Registrant provides that a director will not be personally liable to the
Registrant or its stockholders for monetary damages for breach of fiduciary duty
as a director except
<PAGE>
for liability (a) for any breach of the duty of loyalty to the Registrant or its
stockholders, (b) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (c) for paying a dividend
or approving a stock repurchase in violation of the Delaware General Corporation
Law (the "Act"), or (d) for any transaction from which the director derived an
improper personal benefit.
Section 2(a) of Article Ninth provides that each person who was or is made
a party or is threatened to be made a party to, or is involved in, specific
actions, suits or proceedings by reason of the fact that he or she is or was a
director or officer of the Registrant (or is or was serving at the request of
the Registrant as a director, officer, employee or agent for another entity)
while serving in such capacity will be indemnified and held harmless by the
Registrant, to the full extent authorized by the Act, as in effect (or, to the
extent indemnification is broadened, as it may be amended) against all expense,
liability or loss (including attorneys' fees, judgments, fines, ERISA excise
taxes or penalties and amounts paid or to be paid in settlement) reasonably
incurred by such person in connection therewith. With respect to derivative
actions, indemnification only extends to expenses (including attorneys' fees)
incurred in connection with defense or settlement of such an action and the Act
requires court approval before there can be any indemnification where the person
seeking indemnification has been found liable to the Registrant. Rights
conferred hereby are contract rights and include the right to be paid by the
Registrant the expenses incurred in defending the proceedings specified above,
in advance of their final disposition; provided that, if the Act so requires,
such payment will only be made upon delivery to the Registrant by the
indemnified party of an undertaking to repay all amounts advanced if it is
ultimately determined that the person receiving such payments is not entitled to
be indemnified under such Section 2(a) or otherwise. The Registrant may, by
action of its Board of Directors, provide indemnification to its employees and
agents with the same scope and effect as the foregoing indemnification of
directors and officers.
Section 2(b) of Article Ninth provides that persons indemnified under
Section 2(a) may bring suit against the Registrant to recover unpaid amounts
claimed thereunder, and that if such suit is successful, the expense of bringing
such suit will be reimbursed by the Registrant. While it is a defense to such a
suit that the person claiming indemnification has not met the applicable
standards of conduct making indemnification permissible under the Act, the
burden of proving the defense is on the Registrant and neither the failure of
the Registrant's Board of Directors, independent legal counsel or the
shareholders to have made a determination that indemnification is proper, nor an
actual determination that the claimant has not met the applicable standard of
conduct.
The right to indemnification and the payment of expenses incurred in
defending a proceeding in advance of its final
<PAGE>
disposition conferred in paragraphs 2(a) and 2(b) of Article Ninth is not
exclusive of any other right which any person may have or acquire under any
statute, provision of the Certificate of Incorporation or By-Laws, or otherwise.
The Registrant may maintain insurance, at its expense, to protect itself and any
directors, officers, employees or agents of the Registrant or other entity
against any expense, liability or loss, whether or not the Registrant would have
the power to indemnify such persons against such expense, liability or loss
under the Act.
Item 7. Exemption from Registration Claimed.
Not Applicable.
Item 8. Exhibits.
(4)(a) Liberty National Life Insurance Company 401(k) Plan, as amended
(23) Consent of KPMG Peat Marwick to incorporation by reference of their
audit report of February 1, 1995 into the Form S-8 Registration
Statement for the Liberty National Life Insurance Company 401(k)
Plan
(24) Powers of attorney
The Registrant will submit the Plan and any amendments thereto to the
Internal Revenue Service ("IRS") in a timely manner and has made or will make
all changes required by the IRS in order to qualify the Plan.
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.
Notwithstanding the foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
<PAGE>
table in the effective 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;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at the time shall be deemed to be the initial bona fide offering thereof.
(e) The undersigned registrant hereby undertakes to deliver or cause to be
delivered with the prospectus, to each person to whom the prospectus is sent or
given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.
(h) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director,
<PAGE>
officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this registration
statement to be signed on its behalf by the undersigned thereunto duly
authorized, in the City of Birmingham, State of Alabama, on December 28, 1995.
TORCHMARK CORPORATION
By: /s/ R. K. Richey
-------------------------------
R. K. Richey
Chairman, Chief Executive
Officer and Director
/s/ Keith A. Tucker
------------------------------
Keith A. Tucker
Vice Chairman and Director
(Principal Financial Officer)
/s/ Gary L. Coleman
------------------------------
Gary L. Coleman
Vice President and Chief
Accounting Officer
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
- ------------------------------ --------------------------------
J. P. Bryan, Director Joseph L. Lanier, Jr., Director
* *
- ------------------------------ --------------------------------
Joseph M. Farley, Director Harold T. McCormick, Director
* *
- ------------------------------ --------------------------------
Louis T. Hagopian, Director Joseph W. Morris, Director
*
- ------------------------------ --------------------------------
C. B. Hudson, Director George J. Records, Director
*
- ------------------------------
Yetta G. Samford, Jr. Director
<PAGE>
*By:/s/ William C. Barclift Date: December 28, 1995
--------------------------
William C. Barclift,
Attorney-in-fact
Pursuant to the requirements of the Securities Act of 1933, the trustee has
duly caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Birmingham, State of
Alabama, on December 28, 1995.
LIBERTY NATIONAL LIFE INSURANCE
COMPANY 401(K) PLAN
By: LIBERTY NATIONAL LIFE
INSURANCE COMPANY, as
Trustee
By:/s/ Anthony L. McWhorter
----------------------------
Anthony L. McWhorter
President
<PAGE>
Exhibit 4(a)
LIBERTY NATIONAL LIFE INSURANCE COMPANY
401(k) PLAN
EFFECTIVE January 1, 1995
<PAGE>
TABLE OF CONTENTS
-----------------
ARTICLE PAGE
- ------- ----
1. DEFINITIONS................................................... 1
-----------
1.1 "Accounts"............................................... 1
1.2 "Account Balance"........................................ 1
1.3 "ACP Test"............................................... 1
1.4 "ADP Test"............................................... 1
1.5 "Affiliated Company"..................................... 2
1.6 "Annual Addition"........................................ 2
1.7 "Beneficiary"............................................ 2
1.8 "Break In Service"....................................... 2
1.9 "Code"................................................... 2
1.10 "Committee".............................................. 2
1.11 "Compensation"........................................... 2
1.12 "Contribution"........................................... 4
1.13 "Direct Rollover"........................................ 4
1.14 "Disability"............................................. 4
1.15 "Distributee"............................................ 4
1.16 "Effective Date"......................................... 4
1.17 "Eligible Employee"...................................... 4
1.18 "Eligible Retirement Plan"............................... 4
1.19 "Eligible Rollover Distribution"......................... 4
1.20 "Employee"............................................... 5
1.21 "Employer"............................................... 5
1.22 "Employment Commencement Date"........................... 5
1.23 "Employment Recommencement Date"......................... 5
1.24 "Entry Date"............................................. 5
1.25 "ERISA".................................................. 5
1.26 "Excess Salary Deferral Contributions"................... 5
1.27 "Excess Matching Contributions".......................... 6
1.28 "Forfeitures"............................................ 6
1.29 "Fund"................................................... 6
1.30 "Highly Compensated Eligible Employee"................... 6
1.31 "Highly Compensated Employee"............................ 6
1.32 "Hour of Service"........................................ 7
1.33 "Investment Fund"........................................ 9
1.34 "Leave of Absence"....................................... 9
1.35 "Nonhighly Compensated Eligible Employee"................ 9
1.36 "Normal Retirement Age".................................. 9
1.37 "Participant"............................................ 9
1.38 "Plan"................................................... 9
i
<PAGE>
1.39 "Plan Year".............................................. 9
1.40 "Required Beginning Date"................................ 9
1.41 "Retirement"............................................. 10
1.42 "Severance From Service Date"............................ 10
1.43 "Testing Compensation"................................... 10
1.44 "Trust".................................................. 10
1.45 "Trustee"................................................ 10
1.46 "Valuation Date"......................................... 10
1.47 "Vested Account Balance"................................. 11
1.48 "Vesting Service"........................................ 11
1.49 "Year of Service"........................................ 11
2. PARTICIPATION IN THE PLAN..................................... 11
-------------------------
3. CONTRIBUTIONS................................................. 11
-------------
3.1 Salary Deferral Contributions............................ 11
3.2 Participant's Elections.................................. 13
3.3 Adjustments to Salary Deferral Contributions............. 13
3.4 Matching Contributions................................... 13
3.5 Fail-Safe Contributions.................................. 14
3.6 Makeup Contributions..................................... 14
3.7 Overall Limits on Contributions.......................... 14
3.8 Permitted Employer Refunds............................... 15
3.9 Timing of Deposits....................................... 16
4. ADP and ACP NONDISCRIMINATION TESTS........................... 16
-----------------------------------
4.1 Satisfaction of ADP and ACP Tests........................ 16
4.2 Actual Deferral Percentage............................... 16
4.3 ADP Test................................................. 17
4.4 Actual Contribution Percentage........................... 17
4.5 ACP Test................................................. 17
4.6 Compliance Measures...................................... 18
5. PARTICIPANT ACCOUNTS.......................................... 18
--------------------
5.1 Establishment of Accounts................................ 18
5.2 Valuation of Accounts.................................... 19
5.3 Adjustments to Accounts.................................. 19
6. VESTING....................................................... 19
-------
6.1 Salary Deferral and Rollover Accounts.................... 19
6.2 Matching Account......................................... 19
6.3 Rules for Crediting Vesting Service...................... 20
6.4 Forfeitures.............................................. 21
6.5 Reinstatement of Nonvested Interest Upon Reemployment.... 21
ii
<PAGE>
6.6 Allocation of Forfeitures................................ 22
7. INVESTMENT ELECTIONS.......................................... 22
--------------------
7.1 Investment of Contributions.............................. 22
7.2 Investment Elections..................................... 22
7.3 Investment Transfers..................................... 22
7.4 Transfer of Assets....................................... 22
8. DISTRIBUTIONS................................................. 23
-------------
8.1 Spousal Consent.......................................... 23
8.2 Payment of Benefits...................................... 23
8.3 Form of Payment.......................................... 24
8.4 Revocation of Election and Designation of Beneficiary.... 24
8.5 When Benefits Must Be Paid............................... 25
8.6 Earnings on Undistributed Benefits....................... 25
8.7 Direct Rollover Provision................................ 25
8.8 Rollovers into the Plan.................................. 25
8.9 Hardship Withdrawals..................................... 26
9. TOP-HEAVY PROVISIONS.......................................... 27
--------------------
9.1 Top-Heavy Pre-emption.................................... 27
9.2 Top-Heavy Definitions.................................... 27
9.3 Aggregation of Plans..................................... 29
9.4 Minimum Contribution Rate................................ 29
9.5 Deposit of Minimum Contribution.......................... 29
9.6 Top Heavy Vesting Schedule............................... 30
10. MANAGEMENT OF THE FUND........................................ 30
----------------------
10.1 Assets to Trust......................................... 30
10.2 No Reversion to Employer................................ 30
11. DISCONTINUANCE AND LIABILITIES................................ 30
------------------------------
11.1 Termination............................................. 30
11.2 Employer's Exculpation.................................. 30
11.3 Administrative Expenses................................. 31
11.4 Nonforfeitability due to Termination(s)................. 31
11.5 Exclusive Benefit Rule.................................. 31
11.6 Mergers................................................. 31
11.7 Non-Allocated Trust Assets.............................. 31
12. ADMINISTRATION................................................ 31
--------------
12.1 Appointment of Committee................................ 31
12.2 Conduct of Committee Business........................... 32
12.3 Responsibilities and Duties............................. 32
iii
<PAGE>
12.4 Investment by Trustee.................................... 32
12.5 Indemnification.......................................... 32
12.6 Personal Involvement..................................... 32
12.7 Claims Procedure......................................... 32
12.8 Review of Claims......................................... 33
12.9 Committee Discretion..................................... 33
13. AMENDMENTS.................................................... 33
----------
13.1 Amending the Plan........................................ 33
13.2 Restrictions on Amendments............................... 33
14. MISCELLANEOUS................................................. 34
-------------
14.1 Participation in Plan by Affiliated Companies............ 34
14.2 "Spendthrift" Provision.................................. 34
14.3 QDRO Provisions.......................................... 34
14.4 No Guarantee of Employment............................... 34
14.5 Headings................................................. 35
14.6 Number and Gender........................................ 35
14.7 Construction............................................. 35
iv
<PAGE>
LIBERTY NATIONAL LIFE INSURANCE COMPANY
401(k) PLAN
This Plan is promulgated as of January 1, 1995, by Liberty National Life
Insurance Company ("Employer"), a corporation organized and existing under and
by virtue of the laws of the State of Alabama.
W I T N E S S E T H :
-------------------
WHEREAS, the Employer desires to adopt the Liberty National Life Insurance
Company 401(k) Plan for the benefit of eligible employees of the Employer; and
WHEREAS, the Employer, by action taken the 28th day of December,
199__, duly approved and authorized the Plan embodied herein, said Plan to be
effective as of January 1, 1995; and
WHEREAS, the Employer intends that the Plan shall be established and
maintained for the exclusive benefit of the plan participants and their
beneficiaries; and
WHEREAS, the Employer intends that the Plan shall be at all times qualified
under Section 401 of the Code and the corresponding trust shall be exempt from
federal income taxation under Section 501 of the Code, and that the plan and
trust shall be interpreted so as to continue to remain so qualified and exempt;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants hereinafter set forth, the Employer hereby promulgates the Liberty
National Life Insurance Company 401(k) Plan as follows:
1. DEFINITIONS
-----------
1.1 "Accounts" means collectively the Participant's Salary Deferral,
Matching, and Rollover Accounts.
1.2 "Account Balance" means the sum of the balances in the Participant's
Accounts.
1.3 "ACP Test" means the actual contributions percentage test described in
Section 4.5 of the Plan and Section 401(m) of the Code.
1.4 "ADP Test" means the actual deferral percentage test described in
Section 4.3 of the Plan and Section 401(k) of the Code.
1
<PAGE>
1.5 "Affiliated Company" means any trade or business, whether or not
incorporated, that is under "common control" (within the meaning of Section
414(c) of the Code) with the Employer, and any member of an affiliated service
group (within the meaning of Section 414(m) of the Code) that includes the
Employer.
1.6 "Annual Addition" means the sum of the following amounts credited to a
Participant's account for the Plan Year:
(a) employer contributions,
(b) employee contributions,
(c) forfeitures,
(d) amounts allocated to an individual medical account, as defined in
section 415(l)(2) of the Code, which is part of any pension or annuity
plan maintained by the Employer, and
(e) amounts derived from contributions paid or accrued after December 31,
1985, in taxable years ending after such date, that are attributable
to post-retirement medical benefits allocated to the separate account
of a key employee, as defined in section 419A(d)(3)of the Code, under
a welfare benefit fund, as defined in section 419(e) of the Code,
maintained by the Employer.
1.7 "Beneficiary" shall mean the person, persons, entity, or trust
designated to receive a benefit upon the death of a Participant as provided in
Article 8 hereof.
1.8 "Break In Service" means a 12-consecutive-month period, measured from
an Employee's Employment Commencement Date (or Employment Recommencement Date,
if applicable) or any anniversary thereof, during which the Employee fails to
complete more than 500 Hours of Service.
1.9 "Code" means the Internal Revenue Code of 1986, as amended.
1.10 "Committee" means the Administrative Committee established pursuant
to the provisions of Article 12 to administer the Plan.
1.11 "Compensation" of a Participant means the total cash compensation
paid to the Participant during a calendar year by the Participant's Employer
(excluding compensation paid before the Employee became a Participant),
including salary, wages, bonuses, any amounts not paid directly and currently in
cash to the Participant but paid for the benefit of the Participant through a
"salary reduction" agreement in conjunction with one or more welfare plans of
the Employer, and the total amount deferred pursuant to an Employee's election
under this Plan
2
<PAGE>
or under any other "cash or deferred arrangement" in conjunction with a
qualified retirement plan of the Employer, but excluding:
(a) any reimbursement of or allowances for expenses except for amounts
reimbursed under the Business Expenses for Agents and Management Plan;
(b) Employer contributions to any form of employee retirement, pension,
profit, sharing or thrift plan;
(c) any amount received in connection with the exercise of a stock option
or realized from the sale, exchange, or other disposition of stock
acquired under a stock option;
(d) director's fees;
(e) annual service awards;
(f) deferred compensation accrued under any nonqualified deferred
compensation agreement or contract or any amendment or replacement
thereof;
(g) commissions on insurance policies issued by an Employer during the
five years preceding the Participant's retirement, separation from
service with the Employer, or death, of which the Participant is the
owner, insured, premium payor or beneficiary, or which insures the
life of a member of the Participant's immediate family unless premiums
have been paid for three full years. For purposes of this section
"immediate family" shall mean the Participant's spouse, parents,
parents-in-law, grandparents, brothers, brothers-in-law, sisters,
sisters-in-law, children, sons-in-law, daughters-in-law, and
grandchildren;
(h) any amounts due to or paid to a Participant as a result of the
settlement of his commission account balance upon the termination of
his employment for any reason;
(i) payments made to any Participant after such Participant's separation
from service, in the form of severance benefits; and
(j) any other form of compensation designated by an Employer as not
included in Compensation for its Employees.
The determination of Compensation will be in accordance with records
maintained by the Employer and shall be conclusive. Notwithstanding any other
provision of this definition,
3
<PAGE>
the annual compensation taken into account under this definition for any year
shall not exceed $150,000 (or such other number as may apply pursuant to Section
415(d) of the Code). In determining a Participant's compensation for purposes
of this limitation, the family aggregation rules of section 414(q)(6) of the
Code shall apply, except that in applying such rules, the term "family" shall
include only the Participant's spouse, and any lineal descendants of the
Participant who have not attained age 19 before the end of the year.
1.12 "Contribution" means a contribution made under the Plan by the
Employer for or on behalf of a Participant. Contributions include Salary
Deferral Contributions, Fail-Safe Contributions, and Matching Contributions.
1.13 "Direct Rollover" means a payment by the Plan to the Eligible
Retirement Plan specified by the Distributee.
1.14 "Disability" means total and permanent disability for a period of at
least six months, as defined by the group disability benefit plan maintained by
the Participant's Employer.
1.15 "Distributee" includes an Employee or former Employee. In addition,
the Employee's or former Employee's surviving spouse and the Employee's or
former Employee's spouse or former spouse who is the alternate payee under a
qualified domestic relations order, as defined in Code Section 414(p), are
Distributees with regard to the interest of the spouse or former spouse.
1.16 "Effective Date" of this Plan means January 1, 1995.
1.17 "Eligible Employee" means any Employee whose Employment Commencement
Date occurred on or after January 1, 1995, and who has completed at least one
Year of Service. Notwithstanding the foregoing, Eligible Employees shall
include neither leased employees within the meaning of Section 414(n) of the
Code, nor Employees included in a unit of Employees covered by a collective
bargaining agreement between the Employer and the employee representatives in
the negotiation of which retirement benefits were the subject of good faith
bargaining, unless such bargaining agreement provides for participation in the
Plan.
1.18 "Eligible Retirement Plan" means an individual retirement account
described in Code Section 408(a), an individual retirement annuity described in
Code Section 408(b), an annuity plan described in Code Section 403(a), or a
qualified trust described in Code Section 401(a), that accepts the Distributee's
Eligible Rollover Distribution. However, in the case of an Eligible Rollover
Distribution to the surviving spouse, an Eligible Retirement Plan is an
individual retirement account or individual retirement annuity.
1.19 "Eligible Rollover Distribution" means any distribution of all or any
portion of the balance to the credit of the Distributee, except that an Eligible
Rollover Distribution does
4
<PAGE>
not include: any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life (or life
expectancy) of the Distributee or the joint lives (or joint life expectancies)
of the Distributee and the Distributee's designated beneficiary, or for a
specified period of ten years or more; any distribution to the extent such
distribution is required under Code Section 401(a)(9); and the portion of any
distribution that is not includable in gross income (determined without regard
to the exclusion for net unrealized appreciation with respect to employer
securities).
1.20 "Employee" means any person who is engaged in the conduct of the
business of the Employer, except independent contractors.
1.21 "Employer" means Liberty National Life Insurance Company and any other
business organization that succeeds to its business and elects to continue this
Plan and any Affiliated Company that adopts this Plan.
1.22 "Employment Commencement Date" means the date on which an Employee was
first credited with an Hour of Service.
1.23 "Employment Recommencement Date" means the date on which an Employee
was first credited with an Hour of Service after incurring any Break In Service.
1.24 "Entry Date" means the first business day of each week of the year.
1.25 "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
1.26 "Excess Salary Deferral Contributions" means, with respect to any
affected Participant, the amount of the Participant's actual Salary Deferral
Contributions minus the product of the Participant's Compensation and his
adjusted actual deferral ratio (as determined below).
Affected Participants and their adjusted actual deferral ratios are
identified as follows: The Highly Compensated Employee having the highest
actual deferral ratio is identified. The amount of his Salary Deferral
Contribution is reduced until (i) the ADP Test is satisfied or (ii) his actual
deferral ratio equals the actual deferral ratio of the Highly Compensated
Employee having the second highest actual deferral ratio. If part (ii) of the
preceding sentence applies, the Salary Deferral Contributions of these two
Highly Compensated Employees are reduced until (i) the ADP Test is satisfied or
(ii) their actual deferral ratios equal the actual deferral ratio of the Highly
Compensated Employee who originally had the third highest actual deferral ratio.
This process is repeated until the ADP test is satisfied.
In the case of a Highly Compensated "family unit" to whom Excess Salary
Deferral Contributions must be distributed, Excess Salary Deferral Contributions
are allocated among family members in proportion to the original contributions
of each family member.
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The amount of Excess Salary Deferrals with respect to an Employee for a
Plan Year is reduced by amounts previously distributed to such Employee pursuant
to sections 3.1(b), 3.1(c) of the Plan for the Employee's taxable year ending
with or within the Plan Year.
1.27 "Excess Matching Contributions" means, with respect to any affected
Participant, the amount of the Participant's actual Matching Contributions minus
the product of the Participant's Compensation and his adjusted actual
contribution ratio (as determined below).
Affected Participants and their adjusted actual contribution ratios are
identified as follows: The Highly Compensated Employee having the highest
actual contribution ratio is identified. The amount of his Matching
Contribution shall be reduced until (i) the ACP Test is satisfied or (ii) his
actual contribution ratio equals the actual contribution ratio of the Highly
Compensated Employee having the second highest actual contribution ratio. If
part (ii) of the preceding sentence applies, the Matching Contributions of these
two Highly Compensated Employees are reduced until (i) the ACP Test is satisfied
or (ii) their actual contribution ratios equal the actual contribution ratio of
the Highly Compensated Employee who originally had the third highest actual
contribution ratio. This process is repeated until the ACP test is satisfied.
In the case of a Highly Compensated "family unit" to whom Excess Matching
Contributions must be distributed, Excess Matching Contributions are allocated
among family members in proportion to the original contributions of each family
member.
1.28 "Forfeitures" means those portions of accounts that are forfeited and
reallocated as described in Article 6.
1.29 "Fund" or "Trust Fund" means money or property held by the Trustee
pursuant to the Trust, including any of the Investment Funds.
1.30 "Highly Compensated Eligible Employee" means an Eligible Employee who
is a Highly Compensated Employee.
1.31 "Highly Compensated Employee" means either a highly compensated active
employee or a highly compensated former employee.
A highly compensated active employee includes any employee who performs
service for the Employer during the determination year and who, during the look-
back year: (i) received compensation from the Employer in excess of $75,000 (as
adjusted pursuant to section 415(d) of the Code); (ii) received compensation
from the Employer in excess of $50,000 (as adjusted pursuant to section 415(d)
of the Code) and was a member of the top-paid group for such year; or (iii) was
an officer of the Employer and received compensation during such year that is
greater than 50 percent of the dollar limitation in effect under section
415(b)(1)(A) of the Code. The term "highly compensated employee" also includes:
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(i) employees who are both described in the preceding sentence if the term
"determination year" is substituted for the term "look-back year" and the
employee is one of the 100 employees who received the most compensation from the
Employer during the determination year; and (ii) employees who are 5 percent
owners at any time during the look-back year or determination year.
If no officer has satisfied the compensation requirement of (iii) above
during either a determination year or look-back year, the highest paid officer
for such year shall be treated as a highly compensated employee.
For purposes of this definition of highly compensated employee, the
determination year is the plan year for which the determination of who is highly
compensated is being made. The look-back year is the twelve-month period
immediately preceding the determination year.
A highly compensated former employee includes any employee who separated
from service (or was deemed to have separated) prior to the determination year,
performs no service for the Employer during the determination year, and was a
highly compensated active employee for either the separation year or any
determination year ending on or after the employee's 55th birthday.
If an employee is, during a determination year or look-back year, a family
member of either a 5 percent owner who is an active or former employee or a
highly compensated employee who is one of the 10 most highly compensated
employees ranked on the basis of compensation paid by the Employer during such
year, then the family member and the 5 percent owner or top-ten highly
compensated employee shall be aggregated. In such case, the family member and 5
percent owner or top-ten highly compensated employee shall be treated as a
single employee receiving compensation and plan contributions or benefits equal
to the sum of such compensation and contributions or benefits of the family
member and 5 percent owner or top-ten highly compensated employee. For purposes
of this section, family member includes the spouse, lineal ascendants and
descendants of the employee or former employee, and the spouses of such lineal
ascendants and descendants.
The determination of who is a highly compensated employee, including the
determinations of the number and identity of employees in the top-paid group,
the top 100 employees, the number of employees treated as officers, and the
compensation that is considered, will be made in accordance with section 414(q)
of the Code and the regulations thereunder.
1.32 "Hour of Service" means
(a) Each hour for which an Employee is paid, or entitled to payment, for
the performance of duties for the Employer (or for an Affiliated
Company in the case of an Employee who has transferred his
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employment to the Employer from such Affiliated Company) during the
applicable computation period.
(b) Each hour for which an Employee is paid, or entitled to payment, by
the Employer (or by an Affiliated Company in the case of an Employee
who has transferred his employment to the Employer from such
Affiliated Company) on account of a period of time during which no
duties are performed (irrespective of whether the employment
relationship has terminated) due to vacation, holiday, illness,
incapacity (including Disability), lay-off, jury duty, military duty,
or Leave of Absence. 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 credited to the Employee if such
payment is made or due under a plan maintained solely for the purpose
of providing severance benefits or complying with the applicable
unemployment compensation laws. Hours of service are not credited for
a payment which solely reimburses an Employee for medical or medically
related expenses incurred by the Employee. This paragraph shall be
administered so as to be in compliance with the regulations under Code
Section 401(a)(4) that relate to crediting imputed service.
(c) Each hour for which back pay, irrespective of mitigation of damages,
is either awarded or agreed to by an Employer (or by an Affiliated
Company, in the case of an Employee who has transferred his Employment
to the Employer from such Affiliated Company). The same Hours of
Service shall not be credited both under paragraph (a) or paragraph
(b), as the case may be, and under this paragraph (c).
(d) If, in accordance with regulations under Code Section 401(a)(4) and in
accordance with standard personnel policies applied in a
nondiscriminatory manner to all Employees similarly situated, the
Employer determines in writing that an Employee's approved, unpaid
Leave of Absence furthers the interest of the Employer, each hour for
which the Employee on the approved unpaid Leave of Absence would
normally have received credit under the Plan if he had been working in
his regular employment for the Employer (or an Affiliated Company in
the case of an Employee who has transferred his employment to the
Employer from such Affiliated Company).
(e) An Employee of the Employer (or an Affiliated Company in the case of
an Employee who has transferred his Employment to the Employer from
such Affiliated Company) who is regularly employed by such Employer
(or Affiliated Company) for at least 40 hours a week shall be credited
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with forty-five Hours of Service if under this Plan he would be
credited with at least one Hour of Service during the week.
(f) An Employee of the Employer (or an Affiliated Company in the case of
an Employee who has transferred his employment to the Employer from
such Affiliated Company) who is not regularly employed by such
Employer (or Affiliated Company) for at least 40 hours a week shall be
credited with the actual Hours of Service for which he is paid or
entitled to credit under the Plan.
(g) Hours of Service shall be calculated and credited pursuant to section
2530.200b-2 of the Department of Labor Regulations which are
incorporated herein by reference.
(h) In the case of an Employee who is paid on a commission basis, he will
be deemed to perform his first Hour of Service on the date on which he
is first designated an Employee by the Employer.
1.33 "Investment Fund" means one of several funds in which the Trustee may
invest all or a portion of a Participant's Account Balance. Such funds may
include, but shall not be limited to, a money market fund, a bond fund, a stock
fund, a total return fund, and a general fund. The Trustee reserves the right
to change the investment options available to Participants, but each fund made
available will be administered by financial institutions or mutual funds.
1.34 "Leave of Absence" means an authorized temporary absence from
employment based on the Employer's standard personnel practices.
1.35 "Nonhighly Compensated Eligible Employee" means an Eligible Employee
who is not a Highly Compensated Employee.
1.36 "Normal Retirement Age" means age 65.
1.37 "Participant" means any Eligible Employee who has an account balance
under the Plan.
1.38 "Plan" means the Liberty National Life Insurance Company 401(k) Plan.
1.39 "Plan Year" means the period from January 1 through December 31,
annually.
1.40 "Required Beginning Date" means April 1 of the calendar year following
the calendar year in which the Participant attains (or would have attained) age
70 1/2.
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1.41 "Retirement" means any termination of employment on or after the
Participant's Normal Retirement Age.
1.42 "Severance From Service Date" means the date on which an Employee
terminates employment with the Employer. Such date shall be the earlier of:
(a) the date of death, retirement, or other termination of employment; or
(b) the date on which absence occurs for more than one year due to any
other reason, unless the Employee has been granted a Leave of Absence
in excess of one year; provided, however, a Severance From Service
Date shall occur when an Employee fails to return to active employment
with the Employer within thirty (30) days after the authorized Leave
of Absence expires.
1.43 "Testing Compensation" means all remuneration paid by an Employer to
an Eligible Employee during the Plan Year that is required to be reported as
wages on such Eligible Employee's Form W-2, including amounts that were
previously deferred pursuant to an unfunded non-qualified plan and that are
currently includable in the Employee's gross income; or such other compensation
as determined by the Committee in accordance with applicable law. For each Plan
Year the Committee shall determine whether or not Testing Compensation shall
include amounts which are not currently includable in the Eligible Employee's
gross income by reason of the application of sections 125, 401(k), 402(h)(1)(B),
or 403(b) of the Code.
Notwithstanding any other provision of this definition, the annual
compensation taken into account under this definition for any year shall not
exceed $150,000 (or such other number as may apply pursuant to Section 415(d) of
the Code). In determining a Participant's compensation for purposes of this
limitation, the family aggregation rules of section 414(q)(6) of the Code shall
apply, except that in applying such rules, the term "family" shall include only
the Participant's spouse, and any lineal descendants of the Participant who have
not attained age 19 before the end of the year.
1.44 "Trust" means the legal document governing the management of Plan
assets, as agreed to by the Employer and the Trustee, and by which the rights
and liabilities of the Employer and Trustee are fixed with respect to managing
and controlling the assets.
1.45 "Trustee" means the individual(s), bank(s), trust company(ies), or
other financial institution(s) designated by the Employer to hold and manage the
Trust Fund.
1.46 "Valuation Date" means the last business day of each Plan Year, and
such other dates as the Committee, in its sole discretion, may determine.
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1.47 "Vested Account Balance" means that portion of a Participant's Account
Balance to which he has a nonforfeitable right, in accordance with the
provisions of the Plan. For purposes of determining the amount of a benefit
payment, the value of the Vested Account Balance shall be determined as of the
Valuation Date immediately preceding (or coinciding with) the date the plan
administrator receives properly completed election forms from the Participant or
Beneficiary. The administrator may change the method for determining the date
as of which Vested Account Balances are valued, provided such new policy is
expressed in writing and is applied prospectively only.
1.48 "Vesting Service" means the Years of Service credited to a Participant
under section 6.3 for purposes of determining the Participant's vested
percentage of the balance in his Matching Account.
1.49 "Year of Service" means a 12-consecutive-month period, measured from
an Employee's Employment Commencement Date or Employment Recommencement Date, or
any anniversary thereof, during which such Employee completes at least 1,000
Hours of Service. Service, as determined above, with an Affiliated Company,
whether or not it adopts this Plan, shall be considered service with the
Employer, if the individual becomes an Employee of the Employer.
2. PARTICIPATION IN THE PLAN
-------------------------
An Employee may begin participation in the Plan as of the Entry Date
coincident with or immediately following the date he becomes an Eligible
Employee, provided such Employee is employed by the Employer on such Entry Date.
An individual who has ceased participation in the Plan and who is rehired by the
Employer shall become a Participant as of the date of rehire, unless he has had
a one-year Break in Service. If an individual resumes employment with the
Employer after a one-year Break in Service, he shall become a Participant upon
completion of a Year of Service, retroactive to a date which is not later than
the date of rehire.
3. CONTRIBUTIONS
-------------
3.1 Salary Deferral Contributions.
-----------------------------
(a) Each Eligible Employee may authorize the Employer to reduce his
Compensation by up to 16 percent, and to have such amount
deposited to the Participant's Salary Deferral Account as "Salary
Deferral Contributions" hereunder. However, the total Salary
Deferral Contributions made on a Participant's behalf during such
Participant's taxable year may not exceed $7000 (or such other
number as may apply pursuant to Section 402(g) of the Code).
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(b) In the event the dollar limit described above is exceeded when one
takes into account only contributions to the Plan and/or any
other plan, contract, or arrangement of the Employer that is
subject to Section 402(g) of the Code, (i) the Participant is
deemed to notify the Committee of such excess deferral, and (ii)
the Committee shall direct the Trustee of the Plan to distribute
such excess amount, and any income or loss allocable to such
amount, to the Participant no later than the first April 15th
following the close of the Participant's taxable year. Matching
Contributions attributable to such excess deferral shall be
forfeited and applied like other forfeitures.
(c) In the event a Participant is also a participant in one or more of
the following types of arrangements sponsored by another employer:
(i) another qualified cash or deferred arrangement (as defined
in Code section 401(k)),
(ii) a simplified employee pension (as defined in Code section
408(k)),
(iii) a salary reduction arrangement (as defined in Code section
3121(a)(5)(D)), or
(iv) a 403(b) annuity contract or custodial account,
and the elective deferrals (as defined in Code section 402(g)(3))
made under such other arrangement(s) and his or her salary or wage
deferrals made under this Plan cumulatively exceed the $7,000
limitation (as adjusted) for such Participant's taxable year, the
Participant may, not later than March 1st following the close of
such Participant's taxable year, notify the Committee in writing
of such excess and request that his or her salary or wage
deferrals made under this Plan be reduced by an amount specified
by the Participant. Such amount, and any income or loss allocable
to such amount, shall then be distributed at the same time and in
the same manner as provided in paragraph (b) above.
(d) If the Committee determines during the course of the
Participant's taxable year that an excess deferral has been made
on behalf of a Participant during such taxable year, the
Committee may direct the Trustee to make a corrective
distribution of such excess deferral before the end of the
taxable year. Such a corrective distribution is permissible only
if (i) the Participant notifies the Committee of the excess
deferral
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(or, under the circumstances described in paragraph (b) above,
the Participant is deemed to have made such notification), (ii)
the corrective distribution is made after the date on which the
Plan receives the excess deferral, and (iii) the distribution is
designated as a distribution of an excess deferral.
(e) The Plan may use any reasonable method for computing the income
allocable to such excess amounts, provided that the method does
not violate section 401(a)(4) of the Code, is used consistently
for all Participants and for all corrective distributions under
the Plan for the Plan Year, and is used by the Plan for
allocating income to Participants' Accounts. In no event,
however, shall a Participant receive from the Plan as a
corrective distribution for the taxable year an amount in excess
of the Participant's total salary and wage deferrals under the
Plan for the taxable year.
(f) Any excess deferrals for the Participant's taxable year that
would otherwise be distributed to the Participant shall be
reduced, in accordance with Treasury Regulations, by the amount
of Excess Salary Deferral Contributions previously distributed to
the Participant for the Plan Year beginning with or within such
taxable year.
(g) The Committee reserves the right to reduce Salary Deferral
Contributions on behalf of Highly Compensated Employees to the
extent necessary to preserve the Plan's qualified status under
the Internal Revenue Code.
3.2 Participant's Elections. Each Eligible Employee who wishes to
participate in the Plan shall file a written election form with the Committee
specifying the portion of his Compensation to be contributed to the Plan as a
Salary Deferral Contribution. The form shall also designate a beneficiary and
specify any applicable investment choices. The election shall take effect as
soon as administratively practicable, and the portion of Compensation
contributed shall be deposited to the Participant's "Salary Deferral Account."
Such election of the Participant shall remain in effect until a new election is
filed with the Committee in accordance with Section 33.
3.3 Adjustments to Salary Deferral Contributions. A Participant may elect
to change his rate of Salary Deferral Contributions up to eight times in any
Plan Year. The change in election shall be submitted in writing to the
Committee, and shall take effect as soon as administratively practicable, but no
sooner than the first day of any payroll period after the Participant submits
his change in election.
3.4 Matching Contributions. For each pay period, the Employer shall
forward to the Trust a Matching Contribution on behalf of each Participant equal
to 35% of the Participant's
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Salary Deferral Contribution for such pay period, to the extent the
Participant's Salary Deferral Contribution does not exceed 6% of the
Participant's Compensation for such pay period. That is, the Employer's
Matching Contribution made on behalf of a Participant shall not exceed 2.1% of
the Participant's Compensation for the pay period. Such Matching Contributions
shall be made to the Participant's Matching Account. The Company shall have the
authority to change the rate of Matching Contribution, provided such new rate is
communicated to Participants.
3.5 Fail-Safe Contributions. If the Plan fails to satisfy the ADP Test or
ACP Test, the Employer may, in its discretion, make Fail-Safe Contributions on
behalf of Participants who are Nonhighly Compensated Employees. Such Fail-Safe
Contributions shall, for any Plan Year, be in an amount sufficient, when
allocated among active Participants who are Nonhighly Compensated Employees, to
bring the Plan into compliance with the ADP Test or ACP Test. Such additional
Fail-Safe Contributions shall be allocated to the Salary Deferral Account of
each such Participant in the same proportion that each such Participant's
Compensation for the year bears to the total Compensation of all such
Participants. In the alternative, such contributions may be distributed to
accounts of Participants who are Nonhighly Compensated Employees in any
nondiscriminatory manner. Participants whose participation in the Plan for the
Plan Year in question is limited to maintenance of a Rollover Account need not
be included in the distribution of Fail-Safe Contributions. Fail-Safe
Contributions shall be vested at all times. Fail-Safe Contributions shall also
be subject to the same distribution restrictions that Salary Deferral
Contributions are subject to, as described in section 401(k)(2)(B) of the Code.
Fail-Safe Contributions, however, and income attributable to such contributions,
may not be distributed on account of financial hardship.
Fail-Safe Contributions may be used to pass the ADP Test or ACP Test only
if they satisfy the requirements of Treasury Regulation Section 1.401(k)-
1(b)(3).
3.6 Makeup Contributions. To the extent required by the Uniformed
Services Employment and Reemployment Rights Act of 1994 and otherwise permitted
by applicable law, an employee who has been absent from work by reason of
military duty may make up missed Salary Deferral Contributions and shall be
entitled to have related Matching Contributions credited to his Account.
3.7 Overall Limits on Contributions. In no event shall the Annual
Addition for a Participant exceed the lesser of:
(a) 25% of the Participant's compensation for the Plan Year, or
(b) $30,000, or the applicable limit in effect at any time in the
future.
For purposes of this section 3.7 only, "compensation" shall mean the
Participant's W-2 compensation subject to income tax, i.e., such Participant's
wages as defined in Code section
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3401(a) and all other payments of compensation by the Employer for the Plan Year
for which the Employer is required to furnish the Participant a written
statement under Code sections 6041(d), 6051(a)(3), and 6052. Compensation must
be determined without regard to any rules under Code section 3401(a) that limit
the remuneration included in wages based on the nature or location of the
employment or the services performed.
If as a result of the allocation of Forfeitures, a reasonable error in
estimating a Participant's Compensation, or other facts and circumstances to
which Treasury Regulation section 1.415-6(b)(6) shall be applicable, the Annual
Additions under this Plan would cause the maximum Annual Additions to be
exceeded for any Participant, the Committee shall (1) return any Salary Deferral
Contributions credited for the Plan Year (unadjusted for earnings or losses) to
the extent the return would reduce the excess amount allocated to the
Participant (2) hold any excess amount remaining after the return of salary or
wage deferrals in a "Section 415 suspense account," (3) allocate and reallocate
the "Section 415 suspense account" funds in the next Plan Year (and succeeding
Plan Years if necessary) to all Participants in the Plan before any Employer
contributions which would constitute Annual Additions are made to the Plan for
such Plan Year, and (4) reduce Matching Contributions to the Plan for such Plan
Year the amount of the "Section 415 suspense account" allocated and reallocated
during such Plan Year. The Plan may not distribute excess amounts to
Participants except as provided for above. Matching Contributions attributable
to returned Salary Deferral Contributions shall be placed in the "Section 415
suspense account." The sum of suspended Matching Contributions and returned
Salary Deferral Contributions shall not exceed the amount necessary to reduce
the Participant's Annual Additions to an acceptable level. The "Section 415
suspense account" shall not share in any earnings or losses of the Trust Fund.
3.8 Permitted Employer Refunds. Employer contributions hereunder are made
with the understanding that this Plan will qualify under Code Section 401, and
that such contributions will be deductible under Code Section 404. Any
contribution that is disallowed as a deduction shall be refunded to the Employer
within one year of such disallowance.
(a) If approval of the Plan as originally adopted or, as amended, is
denied, Employer contributions affected by such denial shall be
returned to the Employer within one year after the denial occurs.
(b) Any contribution made by the Employer due to a mistake of fact
shall be refunded to the Employer within one year of such
contribution.
(c) Refunds of contributions due to a disallowance, denial, or
mistake of fact shall be governed by the following requirements:
(i) earnings attributable to the amount being refunded shall
remain in the Plan, but losses thereto must reduce the amount
to be refunded.
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(ii) in no event may a refund be made that would cause the
Account Balance of any Participant to be reduced to less
than what the Participant's Account Balance would have been
had the mistaken amount not been contributed.
3.9 Timing of Deposits. The Employer shall deposit the Salary Deferral
Contributions to the Trust under the terms hereof no later than 30 days after
the end of the month during which such amounts would otherwise have been paid to
the Employee or such other time period permitted by applicable regulations. The
Matching Contributions made on behalf of each Participant shall be paid by the
Employer to the Trustee and allocated to such Participant's Matching Account as
soon as practicable after the end of every pay period. All other Employer
contributions under the Plan shall be deposited to the Trust prior to the due
date for filing the Employer's federal income tax return for the fiscal year,
including any extension thereto.
4. ADP and ACP NONDISCRIMINATION TESTS
-----------------------------------
4.1 Satisfaction of ADP and ACP Tests. Contributions under the Plan will
satisfy the ADP and ACP Tests described in this Article, and the Employer will
maintain such records as are necessary to demonstrate compliance with such
tests, including records of the extent to which Fail-Safe Contributions are
taken into account in calculating percentages.
4.2 Actual Deferral Percentage. The "Actual Deferral Percentage" for a
specified group of Eligible Employees for a Plan Year shall be the average of
the deferral ratios calculated for Eligible Employees in such group by dividing
(a), below, by (b) below, where:
(a) equals the amount of Salary Deferral Contributions--and Fail-Safe
Contributions treated like Salary Deferral Contributions, if any--actually
paid under the Plan on behalf of the Eligible Employee for such Plan Year,
and
(b) equals the Eligible Employee's Testing Compensation for such Plan Year.
If a Highly Compensated Employee and one or more family members are
aggregated in accordance with the family aggregation rule set out in section
1.31 of the Plan, then the actual deferral ratio for the family unit (which is
treated as one Highly Compensated Employee) is calculated by dividing (a) by
(b), where (a) equals the sum of Salary Deferral Contributions actually paid
under the Plan on behalf of all members of the aggregated family unit for such
Plan Year, and (b) equals the sum of the Testing Compensations of all members of
the aggregated family unit for such Plan Year. Except to the extent taken into
account in the preceding sentence, Salary Deferral Contributions and Testing
Compensation of members of the family unit are disregarded in determining actual
deferral percentages for the groups of Highly Compensated Employees and
Nonhighly Compensated Employees.
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4.3 ADP Test. The Actual Deferral Percentage for Highly Compensated
Eligible Employees for any Plan Year shall not exceed, in such Plan Year, the
greater of (a) or (b) as follows:
(a) The Actual Deferral Percentage for Nonhighly Compensated Eligible
Employees multiplied by 1.25 (or the applicable limit in effect
at any time in the future), or
(b) The Actual Deferral Percentage for Nonhighly Compensated Eligible
Employees multiplied by 2 (or the applicable limit in effect at
any time in the future); provided however, the Actual Deferral
Percentage for Highly Compensated Eligible Employees may not
exceed the Actual Deferral Percentage for Nonhighly Compensated
Eligible Employees by more than 2 percentage points (or the
applicable limit in effect at any time in the future).
4.4 Actual Contribution Percentage. The "Actual Contribution Percentage"
for a specified group of Eligible Employees for a Plan Year shall be the average
of the contribution ratios calculated for Eligible Employees in such group by
dividing (a), below, by (b), below, where:
(a) equals the amount of Matching Contributions--and Fail-Safe
Contributions treated like Matching Contributions, if any--actually paid
under the Plan on behalf of the Eligible Employee for such Plan Year, and
(b) equals the Eligible Employee's Testing Compensation for such Plan Year.
If a Highly Compensated Employee and one or more family members are
aggregated in accordance with the family aggregation rule set out in section
1.31 of the Plan, then the actual contribution ratio for the family unit (which
is treated as one Highly Compensated Employee) is calculated by dividing (a) by
(b), where (a) equals the sum of Matching Contributions actually paid under the
Plan on behalf of all members of the aggregated family unit for such Plan Year,
and (b) equals the sum of the Testing Compensations of all members of the
aggregated family unit for such Plan Year. Except to the extent taken into
account in the preceding sentence, Matching Contributions and Testing
Compensation of members of the family unit are disregarded in determining actual
contribution percentages for the groups of Highly Compensated Employees and
Nonhighly Compensated Employees.
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4.5 ACP Test. The Actual Contribution Percentage for Highly Compensated
Eligible Employees for any Plan Year shall not exceed, in such Plan Year, the
greater of (a) or (b) as follows:
(a) the Actual Contribution Percentage for Nonhighly Compensated
Eligible Employees multiplied by 1.25 (or the applicable limit in
effect at any time in the future), or
(b) the Actual Contribution Percentage for Nonhighly Compensated
Eligible Employees multiplied by 2 (or the applicable limit in
effect at any time in the future); provided, however, the Actual
Contribution Percentage for Highly Compensated Eligible Employees
may not exceed the Actual Contribution Percentage for Nonhighly
Compensated Eligible Employee by more than 2 percentage points
(or the applicable limit in effect at any time in the future).
4.6 Compliance Measures. If the ADP or ACP tests are not satisfied, or if
there is a possibility such tests will not be satisfied, the Employer may, in
its discretion, take any one or more of the following actions: (a) reduce Salary
Deferral Contributions on behalf of one or more Highly Compensated Employees,
(b) make Fail-Safe Contributions in accordance with Section 3.5, or (c)
distribute Excess Salary Deferral Contributions and Excess Matching
Contributions as defined in sections 1.26 and 1.27. If the Employer distributes
Excess Salary Deferral Contributions or Excess Matching Contributions, it shall
also distribute income allocable to such Contributions, both for the Plan Year
and for the period between the end of the Plan Year and the time of
distribution. The amount of such income shall be determined in accordance with
Treasury regulations. Moreover, if the Employer relies on the distribution of
Excess Salary Deferral Contributions or Excess Matching Contributions to satisfy
the ADP or ACP Tests, such contributions and income allocable thereto must be
distributed by the close of the Plan Year following the Plan Year in which such
excess contributions were made. Moreover, the Employer will be liable for a 10%
excise tax on the amount of such excess contributions unless the contributions
are distributed within 2 1/2 months of the close of the Plan Year in which such
contributions were made.
If the Employer uses the method of compliance described in Sections 4.3(b)
and 4.5(b) above to satisfy both the ADP and ACP tests, actual contribution
ratios for Highly Compensated Employees shall be reduced in accordance with
regulations adopted pursuant to Section 401(m)(9)(A) of the Code.
5. PARTICIPANT ACCOUNTS
--------------------
5.1 Establishment of Accounts. A Salary Deferral Account, a Matching
Account, and, if applicable, a Rollover Account shall be established for each
Participant in accordance with
18
<PAGE>
the provisions of Articles 3 and 8, as applicable. All Contributions by or on
behalf of a Participant shall be deposited to the appropriate Account.
5.2 Valuation of Accounts. As of each Valuation Date, the Accounts of
each Participant shall be adjusted to reflect any appreciation or depreciation
in the fair market value of a Fund and income or losses earned by the Fund. The
fair market value of a Fund shall be determined by the Trustee and communicated
to the Committee in writing. It shall represent the fair market value of all
securities or other property held for the respective Fund, plus cash and accrued
earnings, less accrued expenses and proper charges against the Fund as of the
Valuation Date. The Trustee's determination shall be final and conclusive for
all purposes of this Plan. Participant Accounts shall be adjusted in proportion
to the balance in each Participant's Accounts on the previous Valuation Date,
plus additions and less distributions.
5.3 Adjustments to Accounts. When determining the value of Participant
Accounts, any deposits due that have not been deposited to a Fund shall be added
to the proper Accounts. Similarly, adjustment for appreciation or depreciation
shall be deemed to have been made as of the Valuation Date to which the
adjustment relates.
6. VESTING
-------
6.1 Salary Deferral and Rollover Accounts. A Participant shall at all
times be fully vested and have a nonforfeitable interest in the balance of his
Salary Deferral and Rollover Accounts, including amounts contributed to his
Salary Deferral Account as Fail-Safe Contributions.
6.2 Matching Account. A Participant shall have a vested and
nonforfeitable interest in a percentage of his Matching Account based on his
completed Years of Service, as specified below:
<TABLE>
<CAPTION>
Completed Years Vested Nonforfeitable
of Service Percentage
<S> <C>
2 10%
3 20
4 40
5 60
6 80
7 100
</TABLE>
19
<PAGE>
6.3 Rules for Crediting Vesting Service.
(a) Subject to the following provisions, a Participant's Vesting
Service shall mean the sum of a Participant's Years of Service
under the Plan.
(b) If an Employee is on an authorized unpaid leave of absence
granted by his Employer in accordance with standard personnel
policies of the Employer applied in a nondiscriminatory manner to
all Employee similarly situated, his period of absence shall not
be considered a Break in Service and shall be counted as Vesting
Service upon his return to active employment.
(c) To the extent required by the Uniformed Services Employment and
Reemployment Rights Act of 1994, an Employee who is absent from
work by reason of military duty (i) shall not incur a Break in
Service by reason of such absence and (ii) shall be credited with
Vesting Service during such absence.
(d) For purposes of determining whether an Employee has incurred a
Break in Service, an Employee shall be credited with Hours of
Service during an uncompensated absence by reason of:
(i) the pregnancy of the Employee,
(ii) the birth of a child of the Employee,
(iii) the placement of a child with the Employee in connection
with the adoption of such child by the Employee, or
(iv) for purposes of caring for the child beginning immediately
after such birth or placement;
provided, the Employee shall, during the period of absence, be
credited with the Hours of Service that would have been credited
at his or her normal work rate but for such absence, or, if the
number of Hours of Service based on a normal rate cannot be
determined, the Employee shall be credited with 8 Hours of
Service per day of such absence. The Employee shall be credited
with no more than 501 Hours of Service during said absence
(unless the Employer gives more credit pursuant to paragraph (b)
above) and credit shall be given in the Plan Year in which such
absence begins if necessary to prevent a Break In Service,
otherwise in the following Plan Year.
20
<PAGE>
(e) An Employee who terminates employment with the Employer with no
vested percentage of his Matching Account shall, if he returns to
Employment, have no credit for Vesting Service prior to such
termination of employment if the total of his consecutive one-
year Breaks in Service immediately preceding his reemployment
exceeds the greater of five years or his aggregate years of
Vesting Service before such termination (whether or not
consecutive, but excluding Vesting Service previously disregarded
under this rule).
(f) Vesting Service of an Employee reemployed following five or more
one-year Breaks in Service shall not be counted for the purpose
of computing his vested percentage in his Matching Account
derived from contributions accrued before his termination of
employment with the Employer. Separate records shall be
maintained reflecting the Participant's vested percentage in his
Matching Account attributable to service before terminating
employment and reflecting the Participant's vested percentage in
such account attributable to service after reemployment.
6.4 Forfeitures. The forfeitable amount credited to the accounts of a
Participant shall be forfeited and applied as provided for by Section 6.6 upon
the earlier of
(a) the occurrence of 5 consecutive one-year Breaks in Service of
such Participant, or
(b) the distribution of the Participant's Vested Account Balance.
6.5 Reinstatement of Nonvested Interest Upon Reemployment.
(a) Reinstatement. If a Participant receives a distribution that
results in a Forfeiture under Section 6.3, his Forfeiture
(unadjusted by subsequent gains or losses) shall be reinstated if
he returns to the service of the Employer and repays the full
amount of the distribution before the earlier of
(i) 5 years after the Participant's Employment Recommencement
Date, or
(ii) the close of the first period of 5 consecutive one-year
Breaks in Service after the distribution.
(b) Source of Funds for Reinstatement. Notwithstanding anything
herein to the contrary, the Forfeiture so reinstated shall be
derived first from Forfeitures arising during the Plan Year of
21
<PAGE>
such reinstatement, then from income or gain to the Plan, and
then from additional Employer contributions.
6.6 Allocation of Forfeitures. Forfeitures occurring during any Plan Year
in the Account of a Participant shall be applied toward payment of Matching
Contributions described in section 3.4.
7. INVESTMENT ELECTIONS
--------------------
7.1 Investment of Contributions. Each Participant may elect to have
future Contributions made on his behalf, or a portion thereof, invested in any
of the Investment Funds. The Committee reserves the right to require that such
elections apply to at least 25% (or such other percentage as the Committee may,
in its discretion, determine) of the balance in a Participant's Accounts.
7.2 Investment Elections. Each Participant may make the elections
described in Section 7.1 by filing an election form with the Committee upon
becoming a Participant. Such elections may be changed prospectively by
delivering a new election form to the Committee by a reasonable deadline to be
established by the Committee. Only one such change may be made between
Valuation Dates, and such changes may not be made more frequently than eight
times in a calendar year. Notwithstanding the foregoing, the Committee reserves
the right to impose restrictions on the manner in which investment elections are
made, as long as such restrictions do not, by design or operation, discriminate
against Nonhighly Compensated Employees.
7.3 Investment Transfers. Each Participant may elect to have the assets
in any Investment Fund, or a portion thereof, transferred to any other
Investment Fund. Only one such change may be made between Valuation Dates, and
such changes may not be made more frequently than eight times in a calendar
year. Notwithstanding the foregoing, the Committee reserves the right to impose
restrictions on the manner in which investment elections are made, as long as
such restrictions do not, by design or operation, discriminate against Nonhighly
Compensated Employees. The Committee shall also have the right to restrict
transfers from one Investment Fund to another whenever, in its judgment, such
restriction is necessary to protect the Investment Funds or is necessitated by
the investments underlying the Investment Funds.
7.4 Transfer of Assets. The Committee shall direct the Trustee to
transfer monies or other property from one Investment Fund to any other
Investment Fund as may be necessary to carry out the aggregate transfer
transactions after the Committee has caused the necessary entries to be made in
the Participant's Accounts in the Investment Funds and has reconciled offsetting
transfer elections.
22
<PAGE>
8. DISTRIBUTIONS
-------------
8.1 Spousal Consent. Payment of all benefits shall be subject to written
consent of the Participant's spouse, unless section 8.2(c) applies to the
distribution.
8.2 Payment of Benefits.
-------------------
(a) Termination of Employment due to Retirement, Death, or
Disability. A Participant who terminates employment due to
Retirement or Disability shall be fully vested in his Account
Balance and entitled to receive his Vested Account Balance in
accordance with the provisions of Sections 8.2 and 8.4. A
Participant who dies shall be fully vested in his Account Balance
and the Participant's Beneficiary shall be entitled to receive
the deceased Participant's Vested Account Balance in accordance
with the provisions of Sections 8.2 and 8.4.
(b) Termination of Employment for Reason Other Than Retirement,
Death, or Disability. A Participant who terminates employment
for any reason other than Retirement, death, or Disability shall
receive his Vested Account Balance on or after his Normal
Retirement Age in accordance with the provisions of Section 8.2
and 8.4 below; provided, however, that such Participant may elect
in writing to receive his Vested Account Balance as soon as is
practicable after the first Valuation Date that occurs at least
90 days following his Severance From Service Date.
(c) Cashouts. Notwithstanding the foregoing, the Committee shall
direct the settlement of any Participant's Account in a single
sum payment if the Participant's Vested Account Balance is $3,500
or less (or such greater amount as may be permitted, from time to
time, under applicable law).
(d) Waiver of 30-day waiting period. If a distribution is one to
which sections 401(a)(11) and 417 of the Code do not apply, such
distribution may commence less than 30 days after the notice
required under section 1.411(a)-11(c) of the Income Tax
Regulations is given, provided that:
(1) the Committee clearly informs the Participant that he 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
(2) the Participant, after receiving the notice, affirmatively
elects a distribution.
23
<PAGE>
8.3 Form of Payment. All benefits under the Plan shall be paid as single
---------------
sums in cash.
8.4 Revocation of Election and Designation of Beneficiary.
-----------------------------------------------------
(a) Revocation of Election. An election by a Participant to receive
his benefit in a single sum or in monthly installments may be
revoked and a new election may be filed in writing with the
Committee any time prior to the commencement of benefits.
(b) Designation of Beneficiary. Each Participant may designate in
writing a Beneficiary to whom, in the event of the Participant's
death, the Participant's Vested Account Balance or any unpaid
portion thereof shall be payable. Notwithstanding the preceding,
a Participant who designates a Beneficiary other than his spouse
must provide the Committee with the written consent of such
Participant's spouse to such Participant's designation of another
beneficiary. The spousal consent must (i) be in writing and
witnessed by a Plan representative or a notary public, (ii)
designate a specific alternative beneficiary or class of
beneficiaries or expressly allow for later changes without
further spousal consent, and (iii) acknowledge the effect of the
election. The Beneficiary so designated may be changed by the
Participant at any time by signing and filing with the Committee
a written notification of such change of Beneficiary, and the
Participant's spouse, if any, must consent to such change in the
manner set forth above, unless the spouse has made a previous
consent that expressly allows for later changes without further
consent.
(c) Conclusiveness of Committee's Records. The facts as shown by the
records of the Committee at the time of death shall be conclusive
as to the identity of the proper payee and the amount properly
payable, and payment made in accordance with such facts shall
constitute a complete discharge of any and all obligations
hereunder and under the Trust.
(d) No Beneficiary Named. If no such Beneficiary designation is on
file with Committee at the death of the Participant, or if such
designation is not effective for any reason, then the
Participant's Vested Account Balance or any unpaid portion
thereof shall be payable to the deceased Participant's spouse, if
living. If such spouse is not living, payment shall be made to
the executors or administrators of the deceased Participant's
estate.
24
<PAGE>
8.5 When Benefits Must Be Paid.
(a) Notwithstanding anything herein to the contrary, unless he elects
otherwise, a Participant's benefits shall commence no later than
60 days after the close of the Plan Year in which occurs the
later of the Participant's Severance From Service Date or his
attainment of age 65.
(b) Required Beginning Date. Notwithstanding the provisions of
Section 85, a Participant may elect to defer the commencement of
benefits by completing a deferral election on a form approved by
the Committee. No Participant may delay the commencement of
benefits beyond his Required Beginning Date, even if he is still
working.
(c) Required Distribution Rules. Distributions from the Plan shall
be made in accordance with the required distribution rules set
out in Section 401(a)(9) of the Code and applicable regulations.
(d) If Participant Dies Before Distribution Has Begun. If the
Participant dies before distribution has begun, benefits must
commence to the Participant's Beneficiary by December 31 of the
year following the year of the Participant's death. If the
Beneficiary is not an individual, the entire interest must be
distributed by December 31 of the calendar year that contains the
fifth anniversary of the Participant's death. If the Beneficiary
is the Participants' surviving spouse, however, payment need not
commence until December 31 of the year in which the Participant
would have attained age 70-1/2.
(e) Calculation of Life Expectancies. For purposes of the required
distribution rules of Code Section 401(a)(9), life expectancies
shall not be recalculated.
8.6 Earnings on Undistributed Benefits. A Participant's Account balance
shall share in investment income and/or depreciation in accordance with the
provisions of the Plan until it is fully liquidated.
8.7 Direct Rollover Provision. Notwithstanding any provision of the Plan
to the contrary that would otherwise limit a Distributee's election under this
Section, a Distributee may elect, at the time and in the manner prescribed by
the 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.
8.8 Rollovers into the Plan. Subject to approval of the Committee, a
Participant may make a rollover into the Trust of amounts accumulated for the
Participant under any other qualified employer-provided retirement plan or
plans; provided, however, the Participant
25
<PAGE>
certifies that the amount being rolled over qualifies under applicable law and
regulations. The amount rolled over shall become subject to all of the terms
and conditions of this Plan after it is rolled over. The amounts rolled over
shall be deposited in a separate account herein referred to as a "Rollover
Account" and shall be invested in the same manner as other Participant Accounts.
The Rollover Account shall be fully vested and nonforfeitable at all times.
8.9 Hardship Withdrawals. Upon the application by any Participant to the
Committee, accompanied by written spousal consent, the Committee may at any time
permit such Participant to withdraw all or a portion of the amounts then
credited to his or her Salary Deferral Account, (not including the earnings
thereon attributable to the year of the withdrawal or any prior year) if the
withdrawal is made on account of financial hardship. A withdrawal is made on
account of financial hardship if the withdrawal both (i) is made on account of
an immediate and heavy financial need of the Participant and (ii) is necessary
to satisfy the financial need. A withdrawal will not be considered made on
account of an immediate and heavy financial need unless it is made for one or
more of the following purposes:
(a) costs directly related to the purchase of a principal residence
for the Participant (excluding mortgage payments);
(b) payment of tuition and related educational fees for the next 12
months of post-secondary education for the Participant, or for
the Participant's spouse, children, or dependents (as defined in
section 152 of the Code);
(c) payments to prevent eviction of the Participant from the
Participant's principal residence or foreclosure on the mortgage
on that residence; or
A hardship withdrawal will not be considered necessary to satisfy the financial
need unless the following requirements are satisfied:
(1) The amount of the withdrawal does not exceed the amount of the
need. The amount of the need may include any amounts necessary to
pay any federal, state, or local income taxes or penalties
reasonably anticipated to result from the distribution.
(2) The Participant has obtained all distributions, other than
hardship distributions, and all nontaxable (at the time of the
loan) loans currently available under all plans maintained by the
Employer.
If a Participant's application for a hardship withdrawal is approved, the
Committee shall then instruct the Trustee to make payment of the approved amount
of the hardship withdrawal to the Participant.
26
<PAGE>
Consequences of Hardship Withdrawals:
- ------------------------------------
. A Participant who makes a hardship withdrawal is prohibited from
making Salary Deferral Contributions or other elective or employee
contributions to the Plan or to any other plan of the Employer for at
least 12 months after receipt of the hardship withdrawal. For this
purpose "any other plan of the Employer" includes any qualified or
nonqualified plan of deferred compensation maintained by the Employer.
The phrase does not include any health or welfare benefit plan,
including one that is part of a cafeteria plan under section 125 of
the Code.
. In the case of a Participant who makes a hardship withdrawal, the
Participant's adjusted $7000 maximum deferral limit for the next year
is reduced by his deferrals made in the year of the hardship
withdrawal.
9. TOP-HEAVY PROVISIONS
--------------------
9.1 Top-Heavy Pre-emption. Notwithstanding any other provision of this
Plan to the contrary, during any Plan Year in which this Plan is Top
Heavy, as defined in Section 9.2(g) below, the Plan shall be governed
in accordance with this Article 9, which shall take precedence over
other sections hereof.
9.2 Top-Heavy Definitions. For purposes of this Article 9, the following
definitions shall apply:
(a) "Compensation" means compensation as defined in Code section
416(i)(D).
(b) "Contribution Rate" means the sum of contributions made by the
Employer under this Plan, including Salary Deferral
Contributions, to a Participant's Accounts divided by such
Participant's compensation for the Plan Year. To determine the
Contribution Rate, the Committee shall consider all qualified
defined contribution plans maintained by the Employer (within the
meaning of the Code) as a single plan.
(c) "Determination Date" means the last day of the preceding Plan
Year, or in the case of the first Plan Year, the last day of such
Plan Year. For purposes of testing the Top-Heavy status of
Required and Permissive Aggregation Groups, Determination Date
means the date of each respective plan's Plan Year which occurs
in the calendar year coincident with the Determination Date of
this Plan.
27
<PAGE>
(d) "Key Employee" means any Employee or former Employee (and the
beneficiaries of such Employee) who at any time during the
determination period was (i) an officer of the Employer if such
individual's annual compensation exceeds 50 percent of the dollar
limitation under section 415(b)(1)(A) of the Code, (ii) an owner
(or considered an owner under section 318 of the Code) of one of
the ten largest interests in the Employer if such individual's
compensation exceeds 100 percent of the dollar limitation under
section 415(c)(1)(A) of the Code, (iii) a 5-percent owner of the
Employer, or (iv) a 1-percent owner of the Employer who has an
annual compensation of more than $150,000. Annual compensation
means compensation as defined in section 415(c)(3) of the Code,
but including amounts contributed by the Employer pursuant to a
salary reduction agreement that are excludable from the
Employee's gross income under section 125, section 402(a)(8),
section 402(h), or section 403(b) of the Code. The determination
of who is a Key Employee will be made in accordance with section
416(i)(1) of the Code and the regulations thereunder.
(e) "Non-Key Employee" means any Employee or Participant of this Plan
who is not a Key Employee.
(f) "Permissive Aggregation Group" means the Required Aggregation
Group plus any other qualified plans maintained by the Employer
and Affiliated Companies, but only if such group would satisfy in
the aggregate the requirements of Sections 401(a)(4) and 410 of
the Code. The Committee shall determine which plans to take into
account in determining the Permissive Aggregation Group.
(g) "Required Aggregation Group" means:
(i) Each qualified plan of the Employer and Affiliated Companies
in which at least one (1) Key Employee participates; and
(ii) Any other qualified plan of the Employer and Affiliated
Companies that enables a plan described in (i) to meet the
requirements of Section 401(a)(4) or 410 of the Code.
(h) "Top Heavy" means the status of the Plan in any Plan Year when
the "Top-Heavy Ratio" as of the Determination Date exceeds sixty
percent (60%).
(i) "Top-Heavy Ratio" is the fraction (a) divided by (b),
determined where (a) equals the total Account Balances
28
<PAGE>
of all Key Employees and (b) equals the total Account
Balances of all Employees.
(ii) Notwithstanding (i) above, the Top-Heavy Ratio shall be
computed pursuant to Section 416(g) of the Code and any
regulations issued thereunder.
9.3 Aggregation of Plans.
(a) All Required Aggregation Groups shall be considered (pursuant to
Section 416(g) of the Code) with this Plan in determining whether
this Plan is Top Heavy.
(i) If such aggregation constitutes a Top-Heavy group, each plan
so aggregated shall be considered Top Heavy.
(ii) If such aggregation does not constitute a Top-Heavy group,
none of the plans so aggregated shall be considered Top
Heavy.
(b) At the direction of the Committee and subject to the restrictions
of Section 401(a)(4) and 410 of the Code, Permissive Aggregation
Groups may be considered with this Plan plus any Required
Aggregation Groups to determine whether such group is Top Heavy.
If such aggregation does not constitute a Top-Heavy group, none
of the plans so aggregated shall be considered Top Heavy.
9.4 Minimum Contribution Rate. For any Plan Year in which this Plan is
Top Heavy, a minimum contribution shall be made for each Non-Key Employee
employed on the last day of the Plan Year equal to the lesser of:
(a) three percent (3%) of such Participant's compensation.
(b) the highest Contribution Rate received by a Key Employee.
Salary Deferral Contributions made on behalf of each Key Employee shall be
considered in determining the highest Contribution Rate received by a Key
Employee. In addition, Salary Deferral Contributions made on behalf of each
Non-Key Employee shall be considered in determining whether the Employer has
satisfied the minimum top-heavy contribution requirement for the Non-Key
Employee.
9.5 Deposit of Minimum Contribution. The Committee shall deposit any
minimum contribution made under this Article 9 to the Matching Account of each
Non-Key Employee.
29
<PAGE>
9.6 Top Heavy Vesting Schedule. For any Plan Year in which this Plan is Top
Heavy, the following vesting schedule shall apply:
<TABLE>
<S> <C>
Completed Years Vested Nonforfeitable
of Service Percentage
2 20%
3 40
4 60
5 80
6 100
</TABLE>
10. MANAGEMENT OF THE FUND
----------------------
10.1 Assets to Trust. All contributions to the Plan by the Employer and
Employees shall be committed in trust to the Trustee selected by the Employer
subject to the terms of the Trust, to be held, managed, and disposed of by the
Trustee in accordance with the terms of the Trust.
10.2 No Reversion to Employer. The Trust shall contain such provisions as
shall render it impossible, except as is otherwise provided under the Plan, for
any part of the corpus of the Trust or income thereon to be at any time used
for, or diverted to, purposes other than for the exclusive benefit of
Participants or their Beneficiaries. Further, it may set forth such other
provisions relating to the custody, management, and disposition of the Trust
assets by the Trustee as shall be deemed advisable by the Employer.
11. DISCONTINUANCE AND LIABILITIES
------------------------------
11.1 Termination. The Plan may be terminated at any time by the Employer,
provided that no part of the corpus of the Trust or income thereon may be used
for or diverted to purposes other than for the exclusive benefit of Participants
or their Beneficiaries, active and retired Employees, except as is otherwise
provided under the Plan. If the Plan is terminated, the assets of the Trust
may, in the Employer's discretion,
(a) be distributed as soon as is practicable after termination of the
Plan (and, if required by the Employer, receipt of a favorable
determination letter from the Internal Revenue Service) or
(b) continue to be held for distribution in the same manner as set
forth in the Plan.
11.2 Employer's Exculpation. The Employer shall have no liability with
respect to the payment of benefits under the Plan, except to pay over to the
Trustee such contributions
30
<PAGE>
as are made by the Employer plus any Rollover Contributions made by the
Participants. The Employer shall have no liability with respect to the
administration of the Trust or of the Fund(s), and each Participant and/or
Beneficiary shall look solely to the Trustee for any payments or benefits under
the Plan.
11.3 Administrative Expenses. The Employer intends to pay all
administrative expenses of the Plan, including any compensation of the Trustee,
and the compensation of consultants, auditor, and counsel, but the Employer
shall not be obliged to pay such expenses. If the Employer elects not to pay
such expenses, they shall be paid from the Trust. Any expenses directly
relating to the investments of the Trust, such as taxes, commissions, and
registration charges, shall be paid from the Trust.
11.4 Nonforfeitability due to Termination(s). Upon termination, partial
termination, or complete discontinuance of contributions under the Plan, the
right of each affected Participant to his Account Balance shall be
nonforfeitable.
11.5 Exclusive Benefit Rule. This Plan and Trust are for the exclusive
benefit of the Participants and their Beneficiaries. This Plan should be
interpreted in a manner consistent with this intent and with the intention of
the Employer that the Trust satisfy those provisions of the Internal Revenue
Code relating to tax qualified employees' trusts.
11.6 Mergers. In the case of any merger or consolidation of the Plan
and/or Trust with, or transfer of the assets or liabilities of the Plan and/or
Trust to, any other plan, the terms of such merger, consolidation, or transfer
shall be such that each Participant on the date thereof (if the Plan then
terminated) would 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 prior to the merger, consolidation, or transfer
if the Plan had then terminated.
11.7 Non-Allocated Trust Assets. Any portion of the Trust which is
unallocated at the time of termination of the Plan shall be allocated among
Participants of the Plan in a nondiscriminatory manner selected by the
Committee, subject to the Annual Addition limits.
12. ADMINISTRATION
--------------
12.1 Appointment of Committee. The administration of the Plan, as
provided herein, shall be vested in and shall be the responsibility of
Administrative Committee, which is the administrator and named fiduciary of the
Plan. The Committee shall consist of three or more individuals who shall be
appointed from time to time by the Employer and shall serve at its pleasure,
without compensation, unless otherwise determined by the Employer; provided,
however, that the Employer may not receive compensation. The Committee members
may be, but are not restricted to employees of the Employer.
31
<PAGE>
12.2 Conduct of Committee Business. The Committee shall elect a Chairman
who shall be a member of the Committee, and a Secretary who may or may not be a
member of the Committee. The Committee shall conduct its business and hold
meetings as determined by it from time to time. A majority of the Committee
shall have power to act, and the concurrence of any member may be by telephone,
wire, cablegram, or letter.
12.3 Responsibilities and Duties.
---------------------------
(a) The Committee shall be responsible for the day-to-day
administration of the Plan. It may appoint other persons or
entities to perform any of its fiduciary functions. Such
appointment shall be made and accepted by the appointee in
writing. The Committee and any such appointee may employ
advisors and other persons necessary or convenient to help it
carry out its duties. The Committee shall have the right to
remove any such appointee from his position, and any person,
group of persons, or entity may serve in more than one fiduciary
capacity.
(b) The Committee shall maintain or shall cause to be maintained
accurate and detailed records and accounts of Employees and of
their rights under the Plan and of all investments, receipts,
disbursements and other transactions. Such accounts, books, and
records relating thereto shall be open at all reasonable times to
inspection and audit by the Employer and by persons designated
thereby.
12.4 Investment by Trustee. The Committee shall have no authority over,
or responsibility for, the management and investments of the assets of the Plan,
which function shall be the sole responsibility of the Trustee; provided,
however, that if an investment manager or managers is appointed to manage
(including the power to acquire and dispose of) any assets of the Plan,
authority over and responsibility for the management of the assets so designated
shall be the sole responsibility of the investment manager or managers.
12.5 Indemnification. The Employer shall indemnify any individual who is
serving on the Committee or who is acting on behalf of the Employer in this
capacity. Such individual shall be indemnified from any and all liability that
may arise by reason of his action or failure to act concerning this Plan,
excepting any willful misconduct or criminal acts.
12.6 Personal Involvement. No individual may participate in the
consideration of any matter or question concerning the Plan which specifically
and uniquely relates to him or to any other person entitled to benefit payments
because of his participation under the Plan.
12.7 Claims Procedure. It shall not be necessary for a Participant or
Beneficiary who has become entitled to receive a benefit hereunder to file a
claim for such benefit. However, any Participant or Beneficiary who believes
that he has become entitled to a benefit under the
32
<PAGE>
Plan and who has not received or commenced receiving a distribution of such
benefit, or who believes that he is entitled to a benefit under the Plan in
excess of the benefit he has received or commenced receiving, may file a written
claim for such benefit with the Committee, pursuant to procedures established by
the Committee. The Committee shall provide the claimant with written notice of
its decision with respect to such claim within 90 days after such written claim
is filed. If the claim is denied in whole or in part, such notice shall include
the specific reasons for denial, specific references to the provisions of the
Plan upon which the denial is based, a description of any additional information
necessary for the claimant to perfect his claim, and an explanation of the
provisions for review of claims set forth in Section 12.8. Such notice shall be
written in a manner calculated to be understood by the claimant.
12.8 Review of Claims. A Participant or Beneficiary who has filed a
written claim for benefits that has been denied may request a full and fair
review of his claim by filing with the Committee a written application for
review at any time within 60 days after receipt by a claimant of written
notification of the denial of his claim. Within 60 days after receipt of a
written application for review, the Committee shall give the claimant written
notice of its decision on review.
12.9 Committee Discretion. The Committee has discretion to interpret this
Plan and to resolve all issues arising hereunder. Such decisions by the
Committee are final and conclusive unless arbitrary and capricious. The
Committee may, in writing, delegate some or all of its authority hereunder to
another entity.
13. AMENDMENTS
----------
13.1 Amending the Plan. The Employer reserves the right to amend the Plan
at any time and in any respect. Any amendment to the Plan shall be adopted by
the Employer's Board of Directors or by any committee or officer to whom the
Board of Directors delegates such authority. The Employer, however, shall not
have any right to amend the Plan in any way that would divert the assets of the
Fund for any purpose other than the exclusive benefit of Participants in the
Plan and their Beneficiaries; provided that the Employer may make any amendment
it determines necessary or desirable, with or without retroactive effect, in
order for the Plan and/or Trust to comply with ERISA or any law of the United
States or of any state or political subdivision thereof.
13.2 Restrictions on Amendments. Each Participant with at least three
Years of Service with the Employer at the time of the adoption of any amendment
that changes the vesting schedule under the Plan or that directly or indirectly
affects the computation of a Participant's vested percentage may elect to have
his vested percentage computed under the Plan without regard to such amendment.
Such election may be made by the Participant at any time but no later than sixty
(60) days after the later of (a) the date the amendment is adopted,
33
<PAGE>
(b) the date the amendment becomes effective, or (c) the date the Participant is
issued written notice of the amendment by the Employer or the Committee.
14. MISCELLANEOUS
-------------
14.1 Participation in Plan by Affiliated Companies. By duly authorized
action, an Affiliated Company may adopt the Plan or terminate participation in
the Plan. Such Affiliated Company by duly authorized action also may determine
the classes of its Employees who shall be Eligible Employees. Such Affiliated
Company shall make contributions pursuant to the plan on behalf of such
Employees as is determined by the Company. If no such action is taken, the
Eligible Employees and the amount of contributions shall be determined in
accordance with existing Plan provisions.
14.2 "Spendthrift" Provision. No benefit under the Plan shall be subject
in any manner to anticipation, pledge, encumbrance, alienation or assignment,
nor to seizure, attachment, or other legal process for the debts of any
Employee or Beneficiary, unless required by law in a particular circumstance.
14.3 QDRO Provisions. Notwithstanding the preceding, in the event that a
"Qualified Domestic Relations Order" ("QDRO") as defined by Section 414(p) of
the Code is issued with respect to any Participant, the Committee shall notify
the Participant and the alternate payee(s) of the QDRO received. In addition,
the Committee shall segregate and conservatively invest the portion of the
Participant's Account Balance that would be payable to the alternate payee(s)
until such time as it can be verified that the order received is a QDRO, and
within 18 months of the order proceed as follows:
(a) if the order is determined to be a QDRO, the Committee shall pay
the alternate payee(s) the portions of the Participant's Account
Balance segregated in accordance with the above, plus interest;
or
(b) if the order is determined not to be a QDRO, or if the issue is
undetermined, the Committee shall pay the portions of the
Participant's Account Balance, segregated in accordance with the
above, to the Participant or Beneficiary(ies) who are otherwise
entitled to such benefit.
If, after 18 months of the order, determination is made that the order is a
QDRO, the determination shall be applied prospectively only.
14.4 No Guarantee of Employment. Nothing set forth in this Plan or the
Trust shall be held or construed to create any liability upon the Employer to
retain any Employee in its employ. The Employer reserves the right to
discontinue the services of any Employee
34
<PAGE>
without any liability except for salary or wages that may be due and unpaid
whenever, in its judgment, its best interests so require.
14.5 Headings. The headings and subheadings used in the Plan are inserted
for convenience of reference only and are not to be used in construing the
instrument or any provision herein.
14.6 Number and Gender. The masculine pronoun used shall include the
feminine pronoun and the singular number shall include the plural number unless
the context of the Plan requires otherwise.
14.7 Construction. The provisions of the Plan shall be in all respects
construed and interpreted in accordance with the laws of the State of Alabama,
except to the extent such laws are superseded by federal law, pursuant to ERISA.
IN WITNESS WHEREOF, LIBERTY NATIONAL LIFE INSURANCE COMPANY, has caused
this 401(k) Plan to be executed on the 28th day of February, 1995.
LIBERTY NATIONAL LIFE INSURANCE COMPANY
By: Anthony L. McWhorter
---------------------------------------------
Its: President
------------------------------------------
35
<PAGE>
Amendment One
to the Liberty National Life Insurance Company
401(k) Plan
Pursuant to the power reserved to Liberty National Life Insurance Company
in section 13.1 of the Liberty National Life Insurance Company 401(k) Plan ("the
Plan"), Liberty National Life Insurance Company hereby amends the Plan effective
January 1, 1995, by adding to section 1.38 ("Plan") the following sentence:
"The Plan is a profit-sharing plan which may invest more than 10% of its assets
in qualifying employer securities (within the meaning of Section 407(d)(5) of
ERISA)."
IN WITNESS WHEREOF, Liberty National Life Insurance Company has caused this
Amendment One to the Plan to be executed on this the 20th day of December, 1995.
LIBERTY NATIONAL LIFE INSURANCE COMPANY
By: /s/ Anthony L. McWhorter
------------------------------------
Anthony L. McWhorter
Its President
ATTEST:
William C. Barclift
- -------------------------
Its Corporate Secretary
<PAGE>
EXHIBIT 23
CONSENT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
The Board of Directors
Torchmark Corporation:
We consent to incorporation by reference in the Registration Statement on Form
S-8 for the Liberty National Life Insurance Company 401(k) Plan of our report
dated February 1, 1995, relating to the consolidated balance sheet of Torchmark
Corporation and subsidiaries as of December 31, 1994 and 1993, and the related
consolidated statements of operations, shareholders' equity, and cash flows and
related schedules of each of the years in the three-year period ended December
31, 1994, which report appears in the December 31, 1994 Annual Report on Form
10-K of Torchmark Corporation. Our report refers to changes in accounting
principles to adopt the provisions of Statement of Financial Accounting
Standards (SFAS) No. 106, Employers' Accounting for Postretirement Benefits
Other Than Pensions, SFAS No. 109, Accounting for Income Taxes and SFAS No. 115,
Accounting for Certain Investments in Debt and Equity Securities.
KPMG Peat Marwick, LLP
Birmingham, Alabama
December 29, 1995
<PAGE>
EXHIBIT 24
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, Gary L. Coleman, William
C. Barclift and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Harold T. McCormick
----------------------------------------
Harold T. McCormick
Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, Gary L. Coleman, William
C. Barclift and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Joseph W. Morris
----------------------------------------
Joseph W. Morris
Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, Gary L. Coleman, William
C. Barclift and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ George J. Records
----------------------------------------
George J. Records
Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director and officer of Torchmark Corporation (the
"Company") constitutes and appoints Keith A. Tucker, Gary L. Coleman, William C.
Barclift and Carol A. McCoy and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ R. K. Richey
----------------------------------------
R. K. Richey
Chairman, Chief Executive Officer and
Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, Gary L. Coleman, William
C. Barclift and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Yetta G. Samford, Jr.
-------------------------------------
Yetta G. Samford, Jr.
Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director and officer of Torchmark Corporation (the
"Company") constitutes and appoints R. K. Richey, Gary L. Coleman, William C.
Barclift and Carol A. McCoy and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Keith A. Tucker
-------------------------------------
Keith A. Tucker
Vice Chairman and Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, Gary L. Coleman, William
C. Barclift and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Joseph M. Farley
------------------------------------
Joseph M. Farley
Director
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned officer of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, William C. Barclift and
Carol A. McCoy and each of them severally, his true and lawful attorneys-in-fact
for him and in his name, place and stead, in any and all capacities, to sign the
Form S-8 Registration Statement for the Liberty National Life Insurance Company
401(k) Plan and any and all amendments and post-effective amendments thereto,
and to file the same with all exhibits thereto and other documents required in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
as fully to all intents and purposes as he might or could do in person, hereby
ratifying and confirming all said attorneys-in-fact and agents or any of them or
their substitute or substitutes, may lawfully do or cause to be done by virtue
hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Gary L. Coleman
-------------------------------------
Gary L. Coleman
Vice President and Chief Accounting
Officer
Date: December 28, 1995
<PAGE>
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT:
The undersigned director of Torchmark Corporation (the "Company")
constitutes and appoints R. K. Richey, Keith A. Tucker, Gary L. Coleman, William
C. Barclift and Carol A. McCoy, and each of them severally, his true and lawful
attorneys-in-fact for him and in his name, place and stead, in any and all
capacities, to sign the Form S-8 Registration Statement for the Liberty National
Life Insurance Company 401(k) Plan and any and all amendments and post-effective
amendments thereto, and to file the same with all exhibits thereto and other
documents required in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power and authority to do and perform each and every act and thing
requisite and necessary to be done as fully to all intents and purposes as he
might or could do in person, hereby ratifying and confirming all said attorneys-
in-fact and agents or any of them or their substitute or substitutes, may
lawfully do or cause to be done by virtue hereof.
IN WITNESS WHEREOF, I have signed this Power of Attorney in the capacity
and on the date indicated below.
/s/ Louis T. Hagopian
------------------------------------
Louis T. Hagopian
Director
Date: December 28, 1995
