FORM 10-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Annual Report Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the fiscal year ended August 31, 1995
Commission File No. 1-6807
FAMILY DOLLAR STORES, INC.
(Exact name of registrant as specified in its charter)
Delaware 56-0942963
(State of incorporation) (I.R.S. Employer Identification Number)
10401 Old Monroe Road, Matthews, North Carolina 28105
(Address of principal executive offices) (Zip Code)
P. O. Box 1017, Charlotte, North Carolina 28201-1017
(Mailing address)
Registrant's telephone number, including area code (704) 847-6961
Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Common Stock, $.10 Par Value New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes X No
Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained,
to the best of registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. X
The aggregate market value of the voting stock of the registrant held by
non-affiliates of the registrant on November 10, 1995, was approximately
$748,800,000.
The number of shares of the registrant's Common Stock outstanding as of
November 10, 1995, was 56,784,612.
DOCUMENTS INCORPORATED BY REFERENCE
Incorporated Documents
(To the extent indicated herein) Location in Form 10-K
Annual Report to Stockholders for the Part II (Items 5, 6, 7 and 8)
fiscal year ended August 31, 1995 Part IV (Item 14)
Proxy Statement dated November 22, 1995 Part III (Items 10, 11, 12
for the Annual Meeting of Stockholders and 13)
<PAGE>
PART I
ITEM 1. BUSINESS
The original predecessor of Family Dollar Stores, Inc., was
organized in 1959 to operate a self-service retail store in Charlotte,
North Carolina. In subsequent years, additional stores were opened, and
separate corporations generally were organized to operate these stores.
Family Dollar Stores, Inc. (together with its subsidiaries referred to
herein as the "Company"), was incorporated in Delaware in 1969, and all
existing corporate entities became wholly-owned subsidiaries. Additional
stores continued to be opened and operated in wholly-owned subsidiaries
organized in the states where the stores were located. Four wholly-owned
subsidiaries organized as North Carolina corporations provide distribution,
trucking, operations, marketing and other services to the Company.
The Company now operates a chain of self-service retail discount
stores. As of November 1, 1995, there were 2,451 stores in 38 states and
the District of Columbia as follows:
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
Texas 234 Indiana 82 Iowa 15
North Carolina 209 Illinois 78 Delaware 13
Georgia 167 West Virginia 73 Connecticut 9
Ohio 153 New York 70 Nebraska 8
Florida 143 Mississippi 64 Colorado 8
Virginia 125 Missouri 49 Rhode Island 7
Tennessee 119 Arkansas 45 Minnesota 6
South Carolina 111 Maryland 42 New Mexico 5
Alabama 106 Oklahoma 40 New Hampshire 3
Pennsylvania 101 Massachusetts 32 Vermont 3
Kentucky 98 Wisconsin 23 District of Columbia 1
Louisiana 84 Kansas 21 South Dakota 1
Michigan 84 New Jersey 18 Maine 1
</TABLE>
The number of stores operated by the Company at the end of each
of its last five fiscal years is as follows: 1,759 stores on August 31,
1991; 1,885 stores on August 31, 1992; 2,035 stores on August 31, 1993;
2,215 stores on August 31, 1994; and 2,416 stores on August 31, 1995.
During the fiscal year ended August 31, 1995, 12 stores were
closed, 10 stores were relocated within the same shopping center or market
area and 18 stores were expanded in size. In addition, the Company contin-
ued its program of periodic improvements in selected existing stores. All
of the stores are occupied under leases, except 144 stores owned by the
Company. (See "Properties" herein.) The Company has announced plans to
open approximately 235 stores and close approximately 35 stores during
the current fiscal year. Such plans are continually reviewed and subject
to change depending on economic conditions and other factors. From
September 1, 1995, through November 1, 1995, the Company opened 41 new
stores, closed 6 stores and expanded 1 store. All stores opening in the
fiscal year ending August 31, 1996, will have a new interior store layout
that features increased emphasis on promotional goods, improved presentation
<PAGE>
of merchandise, lower fixtures and wider aisles for an attractive, customer-
friendly shopping environment. Ten existing stores have been remodeled to
the new prototype, and the Company will consider remodeling additional
stores in the second half of the fiscal year.
As of November 1, 1995, the Company had in the aggregate approxi-
mately 18,600,000 square feet of total store space (including receiving
rooms and other non-selling areas). The typical store has approximately
6,000 to 8,000 square feet of total area. The stores are in both rural and
urban areas, and they are typically freestanding or located in shopping
centers with adequate parking available. As of November 1, 1995, there
were approximately 1,275 stores located in communities with populations of
less than 15,000; approximately 460 stores in communities with populations
of 15,000 to 50,000; and approximately 716 stores in communities with
populations of over 50,000. All stores are similar in appearance and
display highly visible red and white "Family Dollar Stores" or "Family
Dollar" signs.
The Company's stores are operated on a self-service, cash-and-
carry basis, and low overhead permits the sale of merchandise at a
relatively moderate markup. During the fiscal year ended August 31, 1994,
in the face of increasing competition, the Company began to change its
merchandising strategy away from promotional pricing and towards everyday
low prices. In December 1993, prices were reduced on a limited number of
items in 400 stores and in June 1994, this program was expanded to 1,000
stores. In September and October 1994, the number of stores with
merchandise at reduced prices increased to 1,800, and the number of
stockkeeping units with price reductions increased from approximately 500
to approximately 2,500. A lesser number of price reductions were taken in
the balance of the stores in less competitive markets. No single store
accounted for more than one-fifth of one percent of sales during the fiscal
year ended August 31, 1995. Most of the stores are open six evenings a
week, and many remain open on Sunday afternoons.
The stores offer a variety of merchandise including men's,
women's, boys', girls' and infants' clothing, shoes, household products,
health and beauty aids, domestics, toys, school supplies, candy and snack
food, electronics, housewares, paint and automotive supplies. During the
fiscal year ended August 31, 1995, soft goods, including wearing apparel,
shoes, linens, blankets, bedspreads and curtains, accounted for approx-
imately 39 percent of the Company's sales. During the fiscal year
ended August 31, 1995, nationally advertised brand merchandise accounted
for approximately 25 percent of sales, Family Dollar label merchandise
accounted for approximately 6 percent of sales and merchandise sold under
other labels, or which was unlabeled, accounted for the balance of sales.
Irregular merchandise accounted for approximately 2 percent of sales during
such period. The Company does not accept credit cards or extend credit.
The Company has a policy of uniform pricing of items in the
majority of its stores. A zone pricing system in which selected merchandise
in stores in less competitive markets carries higher prices is utilized in
approximately 250 stores. The Company advertises through circulars which
are inserted in newspapers or mailed directly to consumers' residences, and
also advertises to a limited degree in newspapers and on radio in portions
of its operating area. As part of the Company's plan to reduce expenses to
support the program of price reductions on merchandise in its stores, in
<PAGE>
the fiscal year ended August 31, 1995, the number of advertising circulars
distributed to consumers' homes was cut from 22 to 15. All seven adver-
tising coupon booklets that were distributed in the fiscal year ended
August 31, 1994, also were eliminated. In the fiscal year ending
August 31, 1996, the plan is to reduce the number of advertising circulars
distributed to consumers' homes from 15 to 14, and to again distribute no
coupon booklets. Advertising circulars that are passed out in the stores
will be utilized. An unadvertised internal maximum price policy is
followed, and the policy currently is to price most items of merchandise
under $17.99. In the fiscal year ended August 31, 1995, as part of the
Company's emphasis on the sale of lower priced merchandise, the Company
reduced the average price point of merchandise sold in its stores.
The Company purchases its merchandise from approximately 1,400
suppliers and generally has not experienced difficulty in obtaining
adequate quantities of merchandise. Approximately 55 percent of the
merchandise is manufactured in the United States and substantially all such
merchandise is purchased directly from the manufacturer. Purchases of
imported merchandise are made directly from the manufacturer or from
importers. No single supplier accounted for more than 2.5 percent of the
merchandise sold by the Company in the fiscal year ended August 31, 1995.
Each of the Company's 17 buyers specializes in the purchase of specific
categories of goods.
During the fiscal year ended August 31, 1995, approximately
2.5 percent of the merchandise purchased by the Company was shipped
directly to its stores by the manufacturer or importer. Most of the
balance of the merchandise was received at the Company's Distribution
Centers in Matthews, North Carolina, and West Memphis, Arkansas.
Merchandise is delivered to the stores from the Distribution Centers in
Matthews and West Memphis by Company-owned trucks and by common and
contract carriers. During the last fiscal year, approximately 65 percent
of the merchandise delivered was by common or contract carriers. The
average distance between the Distribution Center in Matthews and the
approximately 1,516 stores served by that facility on August 31, 1995, is
approximately 390 miles. The average distance between the Distribution
Center in West Memphis and the approximately 900 stores served by that
facility on August 31, 1995, is approximately 440 miles.
The Company also operates satellite distribution buildings in
Salisbury, North Carolina, and Memphis, Tennessee. High volume, bulk items
of merchandise are shipped by vendors directly to these facilities and then
delivered to the stores by contract carriers. During the fiscal year ended
August 31, 1995, the Company also utilized public freight handlers to a
limited degree to receive from vendors, store and then ship to the
Company's stores selected merchandise.
The business in which the Company is engaged is highly competi-
tive. The principal competitive factors include location of stores, price
and quality of merchandise, in-stock consistency, merchandise assortment
and presentation, and customer service. The Company competes for sales and
store locations in varying degrees with national and local retailing estab-
lishments, including department stores, discount stores, variety stores,
dollar stores, discount clothing stores, drug stores, grocery stores,
outlet stores, warehouse stores and other stores. Many of the largest
retail merchandising companies in the nation have stores in areas in which
<PAGE>
the Company operates. The relatively small size of the Company's stores
permits the Company to open new units in rural areas and small towns, as
well as in large urban centers, in locations convenient to the Company's
low and low-middle income customer base. As the Company's sales are
focused on low priced, basic merchandise, the stores offer customers a
reasonable selection of competitively priced merchandise within a
relatively narrow range of price points.
Generally, in a typical store the highest monthly volume of sales
occurs in December, and the lowest monthly volume of sales occurs in
January and February.
The Company maintains a substantial variety and depth of basic
and seasonal merchandise inventory in stock in its stores (and in
distribution centers for weekly store replenishment) to attract customers
and meet their shopping needs. Vendors' trade payment terms are negotiated
to help finance the cost of carrying this inventory. The Company must
balance the value of maintaining high inventory levels to meet customers'
demands with the cost of having inventories at levels that exceed such
demands and that must be marked down in price in order to sell.
The Company has registered with the U. S. Patent and Trademark
Office the name "Family Dollar Stores" as a service mark.
On August 31, 1995, the Company had approximately 10,000 full-
time employees and approximately 8,500 part-time employees. Approximately
900 additional employees were hired on a temporary basis for the 1994
Christmas season. None of the Company's employees are covered by
collective bargaining agreements. The Company considers its employee
relations to be good.
ITEM 2. PROPERTIES
As of November 1, 1995, the Company operated 2,451 stores in 38
states and the District of Columbia. See "Business" herein. With the
exception of 144 stores owned by the Company, all of the Company's stores
were occupied under lease. Most of the leases are for fixed rentals.
A large majority of the leases contain provisions which may require
additional payments based upon a percentage of sales or property taxes,
insurance premiums or common area maintenance charges.
Of the Company's 2,307 leased stores at November 1, 1995, all but
97 leases contain options to renew for additional terms; in most cases for
a number of successive five-year periods. The following table sets forth
certain data, as of November 1, 1995, concerning the expiration dates of
all leases with renewal options:
<PAGE>
<TABLE>
<CAPTION>
Approximate Number of Approximate Number of
Leases Expiring Leases Expiring
Assuming No Exercise Assuming Full Exercise
Fiscal Years of Renewal Options of Renewal Options
<S> <C> <C>
1996 358 0
1997-1999 1,338 4
2000-2002 412 74
2003-2005 99 153
2006 and thereafter 3 1,979
</TABLE>
Of the 144 Company-owned stores, 18 are located in Texas, 16 in
North Carolina, 13 each in Georgia and Virginia, 12 in Indiana, 11 in
Illinois, 8 in Tennessee, 7 in Michigan, 6 in Ohio, 5 each in Alabama and
Arkansas, 4 each in South Carolina, West Virginia, Florida, Kentucky and
Louisiana, 3 in Mississippi, 2 each in Iowa and Oklahoma and one each in
New Jersey, Missouri and Kansas. In these owned stores, there are
approximately 1,150,000 total square feet of space.
The Company also owns its Executive Offices and Distribution
Center which are located on a 64.5 acre tract of land in Matthews, North
Carolina, just outside of Charlotte, in a building containing approximately
810,000 square feet of which approximately 740,000 square feet are used for
the Distribution Center which includes receiving, warehousing and shipping
facilities, and approximately 70,000 square feet are used for Executive
Offices.
During the fiscal year ended August 31, 1995, the Company leased
buildings in Salisbury, North Carolina (approximately 300,000 square feet)
and Memphis, Tennessee (approximately 270,000 square feet) to serve as
satellite distribution facilities, and a buiding in Charlotte, North
Carolina (approximately 57,000 square feet) to serve as a reclamation
facility for merchandise returned from the stores. These leases continue
in effect in the fiscal year ending August 31, 1996.
In 1992, the Company purchased a 75 acre parcel of land in West
Memphis, Arkansas, and construction began in 1993 on a 550,000 square foot
full-service distribution center. This facility became operational in the
spring of 1994, and currently serves approximately 900 stores. The
approximate $25 million cost for the land, building and equipment was
financed with cash flow from current operations and short-term borrowing
under the Company's bank lines of credit. In October 1995, construction
began on a 300,000 square foot addition to this facility. It is presently
anticipated that construction will be completed by the end of the Company's
fiscal year on August 31, 1996. The estimated $15 million cost for the
expansion and the related equipment is expected to be financed in the same
manner as the financing of the original facility.
The Company owns and operates a fleet of tractor-trailers and
trucks to distribute its merchandise.
<PAGE>
ITEM 3. LEGAL PROCEEDINGS
The Company knows of no material pending legal proceedings, other
than ordinary routine litigation incidental to the business, to which the
Company is a party or of which any of its property is subject.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
There were no matters submitted during the fourth quarter of the
fiscal year ended August 31, 1995, to a vote of security holders through
the solicitation of proxies or otherwise.
ITEM 4a. EXECUTIVE OFFICERS OF THE REGISTRANT
The following information is furnished with respect to each of
the executive officers of the Company as of November 1, 1995:
<TABLE>
<CAPTION>
Name Position and Office Age
<S> <C> <C>
Leon Levine (1) Chairman of the Board 58
and Treasurer
John D. Reier (2) President 55
George R. Mahoney, Jr. (3) Executive Vice President - 53
General Counsel and Secretary
R. David Alexander, Jr. (4) Senior Vice President - 38
Distribution and
Transportation
Albert S. Rorie (5) Senior Vice President - 45
Data Processing
C. Martin Sowers (6) Senior Vice President - 37
Finance
Phillip W. Thompson (7) Senior Vice President - 46
Store Operations
Edward L. Zimmerlin (8) Senior Vice President - 48
Merchandising and
Advertising
Daniel R. Burns (9) Vice President - 48
Loss Prevention
Terry A. Cozort (10) Vice President - 52
Human Resources
<PAGE>
<S> <C> <C>
Owen R. Humphrey (11) Vice President - 54
Distribution and
Transportation
Gilbert A. LaFare (12) Vice President- 49
Real Estate
Edgar L. Paxton (13) Vice President - 53
Advertising and
Sales Promotion
Kenneth T. Smith (14) Vice President - 33
Controller
</TABLE>
(1) Mr. Leon Levine founded the Company's business in 1959 and
was its President, Chief Executive Officer and Treasurer
from 1959 until September 1977 when he was elected Chairman
of the Board, Chief Executive Officer and Treasurer.
(2) Mr. John D. Reier was employed by the Company as Senior
Vice President-General Merchandise Manager in August 1987,
and was promoted to Senior Vice President-Merchandising and
Advertising in that month. He was elected President in
November 1994.
(3) Mr. George R. Mahoney, Jr. was employed by the Company as
General Counsel in October 1976. He was elected Vice
President-General Counsel and Secretary in April 1977,
Senior Vice President-General Counsel and Secretary in
January 1984 and Executive Vice President-General Counsel
and Secretary in October 1991.
(4) Mr. R. David Alexander, Jr. was employed by the Company as
Senior Vice President-Distribution and Transportation in
August 1995. Prior to his employment by the Company, he
was employed by Northern Automotive Co., Inc., a chain of
discount automotive supply stores, from June 1993 to August
1995, where he was Senior Vice President-Distribution and
Transportation. Prior to his employment by Northern
Automotive Co., Inc., he was employed by Best Products Co.,
Inc., a chain of catalogue showroom stores, from June 1985
to May 1993 where he was Senior Vice President-Distribution
and Transportation.
(5) Mr. Albert S. Rorie was employed by the Company in various
capacities in the Data Processing area from March 1973
through January 1981, including employment as Director of
Data Processing. Mr. Rorie was self-employed as a data
processing consultant from January 1981 through May 1982,
when he rejoined the Company and was elected Vice
President-Data Processing. He was elected Senior Vice
President-Data Processing in January 1988.
<PAGE>
(6) Mr. C. Martin Sowers was employed by the Company as an
Accountant in October 1984 and was promoted to Assistant
Controller in January 1985. He was elected Controller in
January 1986, Vice President-Controller in July 1989 and
Senior Vice President-Finance in December 1991.
(7) Mr. Phillip W. Thompson was employed by the Company in
January 1984 in the Store Operations Department. He was
elected Vice President-Store Operations in January 1985,
and Senior Vice President-Store Operations in January 1992.
(8) Mr. Edward L. Zimmerlin was employed by the Company in
March 1995 as Senior Vice President-Merchandising and
Advertising. For more than five years prior to his
employment by the Company, he was employed by Hills Stores,
a chain of discount stores, where he was Vice President-
Merchandising.
(9) Mr. Daniel R. Burns was employed by the Company as Vice
President-Loss Prevention in October 1994. For more than
five years prior to his employment by the Company, he was
employed by Kay-Bee Toy Stores where he was Vice President-
Loss Prevention and Shortage Control.
(10) Mr. Terry A. Cozort was employed by the Company as Director
of Human Resources in April 1988. He was elected Vice
President-Human Resources in July 1989.
(11) Mr. Owen R. Humphrey was employed by the Company in August
1979, and was promoted to Distribution Center Operations
Manager in December 1983. Mr. Humphrey was promoted to
Director of Distribution in January 1988, and was elected
Vice President-Distribution and Transportation in July 1989.
(12) Mr. Gilbert A. LaFare was employed by the Company in August
1992 as Vice President-Real Estate. For more than five
years prior to his employment by the Company, he was Vice
President-Real Estate with Little Caesars Enterprises,
Inc., a restaurant chain.
(13) Mr. Edgar L. Paxton was employed by the Company in December
1985 as Director of Advertising. He was elected Vice
President-Advertising and Sales Promotion in January 1988.
(14) Mr. Kenneth T. Smith was employed by the Company as a
financial analyst in October 1990. Mr. Smith was promoted
to Director of Information Services-Operations in February
1992 and to Director of Accounting in October 1992. He was
elected Vice President-Controller in October 1995.
All executive officers of the Company are elected by and serve at
the pleasure of the Board of Directors.
<PAGE>
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY
AND RELATED STOCKHOLDER MATTERS
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1995, on
page 16 under the captions "Market Price and Dividend Information" and
"Market Prices and Dividends" and is incorporated herein by reference.
ITEM 6. SELECTED FINANCIAL DATA
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1995, on
pages 14 and 15 under the caption "Summary of Selected Financial Data" and
is incorporated herein by reference. The Company did not have any long-
term debt at the end of each of its last five fiscal years.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1995, on
pages 14 through 16 under the caption "Management's Discussion and Analysis
of Financial Condition and Results of Operations" and is incorporated
herein by reference.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
The information required by this item is included in the Company's
Annual Report to Stockholders for the fiscal year ended August 31, 1995, on
pages 17 through 24 and is incorporated herein by reference.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS
ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
The information required by this item as to Directors is included
in the Company's proxy statement dated November 22, 1995, on pages 5 and 6
under the caption "Election of Directors" and is incorporated herein by
reference. The information required by this item as to executive officers
is included in Item 4A in Part I of this report.
<PAGE>
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is included in the Company's
proxy statement dated November 22, 1995, on pages 6 through 12 under the
caption "Executive Compensation" and is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
The information required by this item is included in the Company's
proxy statement dated November 22, 1995, on pages 3 and 4 under the caption
"Ownership of the Company's Securities" and is incorporated herein by
reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The information required by this item is included in the
Company's proxy statement dated November 22, 1995, on page 12 under the
caption "Related Transactions" and is incorporated herein by reference.
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K
(a) Documents filed as part of this report:
1 and 2. Financial Statements and Financial Statement Schedules:
The consolidated financial statements of Family Dollar Stores,
Inc., and subsidiaries which are incorporated by reference to the
Annual Report to Stockholders for the fiscal year ended August 31,
1995, are set forth in the index on page 16 of this report.
All schedules for which provision is made in the applicable
accounting regulations of the Securities and Exchange Commission
are not required under the related instructions, are inapplicable
or the information is included in the consolidated financial
statements, and therefore, have been omitted.
The financial statements of Family Dollar Stores, Inc. (Parent
Company) are omitted because the registrant is primarily an
operating company and all subsidiaries included in the consoli-
dated financial statements being filed, in the aggregate, do not
have minority equity and/or indebtedness to any person other than
the registrant or its consolidated subsidiaries in amounts which
together exceed 5 percent of the total assets as shown by the
most recent year-end consolidated balance sheet.
<PAGE>
3. Exhibits:
Exhibits incorporated by reference:
3(a)(i) Certificate of Incorporation, dated November 24, 1969,
(filed as Exhibit 3(a) to the Company's Registration
Statement on Form S-1, No. 2-35468).
(ii) Certificate of Amendment, dated February 2, 1972, of
Certificate of Incorporation (filed as Exhibit
3(a)(ii) to the Company's Form 10-K (File No. 1-6807)
for the year ended August 31, 1980).
(iii) Certificate of Amendment, dated January 23, 1979, of
Certificate of Incorporation (filed as Exhibit 2 to
the Company's Form 10-Q (File No. 1-6807) for the
quarter ended February 28, 1979).
(iv) Certificate of Amendment, dated January 20, 1983, of
Certificate of Incorporation (filed as Exhibit 4(iv)
to the Company's Registration Statement on Form S-3,
No. 2-85343).
(v) Certificate of Amendment, dated January 16, 1986, of
Certificate of Incorporation (filed as Exhibit 3(a)(v)
to the Company's Form 10-K (File No. 1-6807) for the
year ended August 31, 1986).
(vi) Certificate of Amendment, dated January 15, 1987, of
Certificate of Incorporation (filed as Exhibit
3(a)(vi) to the Company's Form 10-K (File No. 1-6807)
for the year ended August 31, 1987).
(b) By-Laws, as amended as of November 6, 1987 (filed as
Exhibit 3(b) to the Company's Form 10-K (File No.
1-6807) for the year ended August 31, 1987).
* 10 (i) Incentive Profit Sharing Plan (filed as Exhibit 13(b)
to the Company's Registration Statement on Form S-1,
No. 2-35468).
* 10 (ii) 1979 Non-Qualified Stock Option Plan, amended as of
April 17, 1991 (filed as Exhibit 10(vii) to the
Company's Form 10-K (File No. 1-6807) for the year
ended August 31, 1991).
* 10 (iii) 1989 Non-Qualified Stock Option Plan, amended as of
April 17, 1991 (filed as Exhibit 10(viii) to the
Company's Form 10-K (File No. 1-6807) for the year
ended August 31, 1991).
* 10 (iv) Savings and Retirement Plan and Trust of Family Dollar
Stores, Inc. adopted as of August 1, 1986 (filed as
Exhibit 10(ix) to the Company's Form 10-K (File No.
1-6807) for the year ended August 31, 1986).
<PAGE>
* 10 (v) Amendment No. One dated August 18, 1988, to Savings
and Retirement Plan and Trust of Family Dollar Stores,
Inc. adopted August 1, 1986 (filed as Exhibit 10 (xi)
to the Company's Form 10-K (File No. 1-6807) for the
year ended August 31, 1988).
10 (vi) Revolving/Term Loan Agreement dated as of February 28,
1993, between the Company and NationsBank of North
Carolina, N.A., as amended by letter agreement dated
March 31, 1993 (filed as Exhibit 10(vii) to the
Company's Form 10-K (File No. 1-6807) for the year
ended August 31, 1993).
* 10 (vii) Employment Agreement dated November 10, 1994, between
the Company and John D. Reier (filed as Exhibit 10
(viii) to the Company's Form 10-K (File No. 1-6807)
for the year ended August 31, 1994).
Exhibits filed herewith:
* 10 (viii) Family Dollar Employee Savings and Retirement Plan and
Trust, amended and restated as of January 1, 1987.
11 Statement Re: Computations of Per Share Earnings.
13 Annual Report to Stockholders for the fiscal year
ended August 31, 1995 (only those portions
specifically incorporated by reference herein shall be
deemed filed).
21 Subsidiaries of the Company.
27 Financial Data Schedule
* Exhibit represents a management contract or compensatory plan.
(b) No reports on Form 8-K have been filed by the Company
during the last quarter of the period covered by this
report.
<PAGE>
FAMILY DOLLAR STORES, INC., AND SUBSIDIARIES
Index
The consolidated financial statements of Family Dollar Stores, Inc., and
subsidiaries together with the report of Price Waterhouse LLP incorporated
in this report appear on the following pages of the Annual Report to
Stockholders for the fiscal year ended August 31, 1995.
<TABLE>
<CAPTION>
Page of the
Annual Report
<S> <C>
Report of Independent Accountants 17
Consolidated Statements of Income 17
Consolidated Balance Sheets 18
Consolidated Statements of Shareholders'
Equity 19
Consolidated Statements of Cash Flows 20
Notes to Consolidated Financial Statements 21-24
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
FAMILY DOLLAR STORES, INC.
(Registrant)
Date November 16, 1995 By LEON LEVINE
LEON LEVINE
Chairman of the Board
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed by the following persons on behalf of the registrant
and in the capacities and on the date indicated.
Signature Title Date
LEON LEVINE Chairman of the Board and November 16, 1995
LEON LEVINE Director (Chief Executive
Officer and Chief Financial
Officer)
JOHN D. REIER President and Director November 16, 1995
JOHN D. REIER
GEORGE R. MAHONEY, JR. Executive Vice President November 16, 1995
GEORGE R. MAHONEY, JR. and Director
C. MARTIN SOWERS Senior Vice President- November 16, 1995
C. MARTIN SOWERS Finance
KENNETH T. SMITH Vice President-Controller November 16, 1995
KENNETH T. SMITH (Principal Accounting
Officer)
THOMAS R. PAYNE Director November 16, 1995
THOMAS R. PAYNE
MARK R. BERNSTEIN Director November 16, 1995
MARK R. BERNSTEIN
JAMES H. HANCE, JR. Director November 16, 1995
JAMES H. HANCE, JR.
FAMILY DOLLAR EMPLOYEE SAVINGS AND RETIREMENT
PLAN AND TRUST
AMENDED AND RESTATED
AS OF JANUARY 1, 1987
<PAGE>
TABLE OF CONTENTS
ARTICLE 1. RECITALS...........................................-1-
ARTICLE 2. DEFINITIONS AND CONSTRUCTION.......................-2-
2.1 Definitions.....................................-2-
2.2 Construction...................................-17-
2.3 Governing Law..................................-17-
2.4 Effect of Restatement..........................-17-
ARTICLE 3. PARTICIPATION AND SERVICE.........................-18-
3.1 Participation..................................-18-
3.2 Service........................................-18-
3.3 Inactive Status................................-18-
3.4 Participation and Service Upon Reemployment....-18-
ARTICLE 4. CONTRIBUTIONS AND FORFEITURES.....................-20-
4.1 Employer Contributions and Salary Deferral
Contributions..................................-20-
4.2 No Employee After-Tax Contributions by
Participants...................................-20-
4.3 Participant's Election to Make Salary
Deferral Contributions.........................-20-
4.4 Limitations on Salary Deferral Contributions
and on Matching Contributions..................-21-
4.5 Rollover Contributions.........................-26-
4.6 Disposition of Forfeitures.....................-27-
4.7 Pay Back Provision.............................-28-
ARTICLE 5. ALLOCATIONS TO PARTICIPANTS' ACCOUNTS.............-30-
5.1 Individual Accounts............................-30-
5.2 Account Adjustments............................-30-
5.3 Maximum Additions..............................-33-
ARTICLE 6. BENEFITS..........................................-39-
6.1 Retirement or Disability.......................-39-
6.2 Death and Designation of Beneficiary...........-39-
6.3 Termination for Other Reasons..................-40-
6.4 Payment of Benefits............................-42-
6.5 Hardship and Other In-Service Withdrawals
by Participants................................-45-
6.6 Loans to Participants..........................-45-
<PAGE>
6.7 Distributions Pursuant to Qualified
Domestic Relations Orders......................-46-
ARTICLE 7. TRUST FUND AND THE TRUSTEE........................-50-
7.1 Trust Fund.....................................-50-
7.2 Trustee........................................-50-
7.3 Records and Accounts of Trustee................-50-
7.4 Basis for Accounts.............................-50-
7.5 Annual Reports.................................-50-
7.6 Investment of the Trust Fund...................-51-
7.7 Investments in Pooled Fund.....................-51-
7.8 Collective Investment Subaccounts..............-51-
7.9 Trustee's Powers...............................-52-
7.10 Consultation with Counsel......................-53-
7.11 Compensation and Expenses......................-53-
7.12 Resignation, Removal, and Successor Trustee....-54-
7.13 Acts of Multiple Trustee.......................-54-
7.14 Indemnification of Individual Trustee..........-55-
ARTICLE 8. ADMINISTRATION....................................-56-
8.1 Allocation of Responsibility Among
Fiduciaries for Plan and Trust Administration..-56-
8.2 Appointment of Committee.......................-56-
8.3 Claims Procedure...............................-57-
8.4 Records and Reports............................-57-
8.5 Other Committee Powers and Duties..............-57-
8.6 Rules and Decisions............................-58-
8.7 Committee Procedures...........................-58-
8.8 Authorization of Benefit Payments..............-59-
8.9 Application and Forms for Benefits.............-59-
8.10 Facility of Payment............................-59-
8.11 Inability to Locate Participant,
Surviving Spouse or Beneficiary ...............-59-
8.12 Omission of Eligible Employee..................-59-
8.13 Inclusion of Ineligible Employee...............-59-
8.14 Bonding........................................-60-
8.15 Indemnification................................-60-
8.16 Plan Administrator's Discretion to
Interpret the Plan.............................-60-
ARTICLE 9. INSURANCE CONTRACTS...............................-61-
9.1 Purchase of Insurance Contracts................-61-
9.2 Types of Insurance Contracts...................-61-
<PAGE>
9.3 Ownership and Beneficiary of
Insurance Contracts............................-61-
9.4 Special Provisions Affecting
Insurance Contracts............................-61-
9.5 Death Prior to Issuance of
Insurance Contract.............................-62-
9.6 Special Rules Regarding Investment in
Insurance for Spouse and/or Children...........-62-
9.7 Status of Insurer..............................-62-
ARTICLE 10. MISCELLANEOUS....................................-63-
10.1 Nonguarantee of Employment.....................-63-
10.2 Rights to Trust Assets.........................-63-
10.3 Nonalienation of Benefits......................-63-
10.4 Discontinuance of Employer Contributions.......-63-
ARTICLE 11. AMENDMENTS AND ACTION BY EMPLOYER................-64-
11.1 Amendments.....................................-64-
11.2 Special Rules Regarding Amendments
Relating to Vesting............................-64-
11.3 Action by Employer.............................-65-
ARTICLE 12. SUCCESSOR EMPLOYER AND MERGER
OR CONSOLIDATION OF PLANS.............................-66-
12.1 Successor Employer.............................-66-
12.2 Plan Assets in the Event of Merger
or Consolidation of Plans......................-66-
ARTICLE 13. PLAN TERMINATION.................................-67-
13.1 Right to Terminate.............................-67-
13.2 Partial Termination............................-67-
13.3 Liquidation of the Trust Fund..................-67-
13.4 Manner of Distribution.........................-67-
ARTICLE 14. RELATED CORPORATIONS.............................-68-
14.1 Joinder........................................-68-
14.2 Contributions..................................-68-
14.3 Forfeitures....................................-68-
14.4 Common Service.................................-68-
14.5 Commingling of Funds...........................-68-
<PAGE>
FAMILY DOLLAR EMPLOYEE SAVINGS AND RETIREMENT
PLAN AND TRUST
AMENDED AND RESTATED
AS OF JANUARY 1, 1987
THIS PLAN AND TRUST, amended and restated as of January 1, 1987, by
and between Family Dollar Stores, Inc. of Matthews, North Carolina, and its
related corporations which have adopted this plan (collectively, the
"Employer"); and George R. Mahoney, Jr., C. Martin Sowers and John D. Reier
(collectively, the "Trustee");
W I T N E S S E T H:
ARTICLE 1. RECITALS
A. Effective as of August 1, 1986, the Employer adopted the
Family Dollar Employee Savings and Retirement Plan and Trust to enable its
eligible employees to share in its profits.
B. The Plan and Trust was subsequently amended; and, effective
as of January 1, 1987 (or as otherwise provided herein), the Employer has
adopted the amended and restated Plan and Trust as set forth herein.
C. The Plan and Trust are intended to meet the requirements of
Sections 401(a), 401(k) and 501(a) of the Internal Revenue Code.
D. The provisions of this Plan and Trust shall apply only to an
employee who has an Hour of Service on or after the Effective Date. The
rights and benefits, if any, of a former employee shall be determined in
accordance with the prior provisions of the Plan in effect on the date his
employment terminated.
NOW, THEREFORE, the Employer hereby amends and restates the Family
Dollar Employee Savings and Retirement Plan and Trust; and the Trustee
agrees to continue to administer the Trust as herein so amended and
restated, in accordance with the following terms and provisions.
<PAGE>
ARTICLE 2. DEFINITIONS AND CONSTRUCTION
2.1 Definitions: The following words and phrases, when used
herein, unless their context clearly indicates otherwise, shall have the
following respective meanings:
(1) ACTUAL CONTRIBUTION PERCENTAGE or ACP: For any Plan
Year beginning after December 31, 1986, with respect to Participants who
are members of the Highly Compensated Employee group and the Non-Highly
Compensated Employee group, the average of the ratios (expressed as a
percentage and calculated separately for each Eligible Participant in each
group) of:
(i) the Matching Contributions and prior to
January 1, 1994, any Employee After-Tax Contributions paid under the Plan
on behalf of each Eligible Participant for such Plan Year (plus, such other
Salary Deferral Contributions or qualified non-elective contributions under
this or any other plan of the Employer or Aggregated Employer as may be
permitted under the Commissioner's regulations), to
(ii) each Eligible Participant's Compensation for
such Plan Year.
If other plans of the Employer or any Aggregated Employer have employee
contributions or matching contributions under Code Section 401(m), then all
such plans shall be treated as one plan for purposes of calculating the
Participants' ACP (using for this purpose each such plan's definition of
ACP), but such aggregation shall take place only to the extent that such
plans are treated as one plan for purposes of Code Section 410(b).
(2) ACTUAL DEFERRAL PERCENTAGE or ADP: For any Plan
Year beginning after December 31, 1986, with respect to the Highly
Compensated Employee group and Non-Highly Compensated Employee group, the
average of the ratios (expressed as a percentage and calculated separately
for each Eligible Participant in each group) of:
(i) the amount of Salary Deferral Contributions
paid over to the Trust on behalf of each Eligible Participant, (plus such
other Matching Contributions and other qualified nonelective contributions
allocated to the Participant's Salary Deferral Account, as may be permitted
under the Commissioner's regulations), to
(ii) each Eligible Participant's Compensation for
the Plan Year.
If other plans of the Employer or any Aggregated Employer have cash or
deferred arrangements under Code Section 401(k), then all such plans shall
be treated as one plan for purposes of calculating Participants' ADP, but
only to the extent that such plans are treated as one plan for purposes of
Code Section 410(b). Furthermore, for the purpose of determining the ADP
of any Highly Compensated Employee, all plans of the Employer and any
Aggregated Employer which have cash or deferred arrangements under Code
Section 401(k) shall be treated as one plan.
<PAGE>
(3) ADDITIONS or ANNUAL ADDITIONS: With respect to each
Participant for each Limitation Year, the sum of: all Employer
Contributions and Forfeitures allocated to his Employer Contribution
Account; plus all Salary Deferral Contributions allocated to his Salary
Deferral Account; plus all Employee After-Tax Contributions for such
Limitation Year which were allocated to his Employee After-Tax Contribution
Account (provided, that Employee After-Tax Contributions for Plan Years
beginning prior to January 1, 1987 shall be considered to be Additions only
to the extent they were considered as Additions under the Code in existence
as of that Plan Year). The term "Annual Additions" does not include the
following: amounts contributed to an account because of an erroneous
Forfeiture or an erroneous failure to allocate in a prior Limitation Year,
but such Forfeiture reinstatement or contribution (less actual investment
gains attributable to the period subsequent to the Limitation Year to which
it relates) will be considered an Annual Addition for the Limitation Year
to which it relates; the allowable restoration of accrued benefits
following either repayment of withdrawn mandatory Employee contributions or
repayments of benefits paid out; amounts distributed from the Plan as
permitted by Code Section 402(g)(2) and Treasury Regulation Section
1.415-6(b)(6)(iv); or the transfer of funds from another qualified plan.
Furthermore, with respect to a Participant's Employee After-Tax
Contributions, the term "Annual Additions" does not include the following:
rollover contributions as permitted under ERISA; repayments of loans made
to a Participant; allowable repayments of either withdrawn mandatory
Employee contributions or benefits paid out; qualified voluntary Employee
contributions allowed under Code Section 219(e)(2); or the direct transfer
of funds from another qualified plan, if any, pursuant to Section 4.4 of
this Plan. Amounts allocated after March 31, 1984 to an individual medical
account (as defined in Code Section 415(1)(2)) which is part of a pension
or annuity plan maintained by the Employer shall be treated as Annual
Additions to a defined contribution plan. Amounts derived from
contributions paid or accrued after December 31, 1985 in taxable years
ending after such date, which are attributable to post-retirement medical
benefits under a welfare benefit fund (as defined in Code Section 419(e))
maintained by the Employer which are allocated to the separate account of
an Employee who is or was a Key Employee during the Plan Year or the
preceding Plan Year, also shall be treated as Annual Additions to a defined
contribution plan.
(4) AGGREGATED EMPLOYER: An employer (whether or not
considered an Employer under the Plan) required to be aggregated with the
Employer under subsection b, c, m, n or o of Code Section 4l4; provided,
that another employer shall be an Aggregated Employer for any Plan Year
only to the extent the foregoing subsections of Code Section 414 applied
with respect to that Plan Year, and only to the extent such employer is
required to be aggregated notwithstanding the separate lines of business
provisions of Code Section 414(r).
(5) ALTERNATE PAYEE: A beneficiary as defined in
Section 6.7.
(6) ANNIVERSARY DATE: December 31 of each year.
(7) AUTHORIZED LEAVE OF ABSENCE: Any absence authorized
in writing by the Employer under the Employer's standard personnel
practices, provided that all persons under similar circumstances must be
treated alike in the granting of such Authorized Leaves of Absence
<PAGE>
and provided further that the Participant returns within the period of
authorized absence. An absence due to service in the Armed Forces of the
United States shall be considered an Authorized Leave of Absence to the
extent required by applicable statutes of the United States in effect from
time to time, provided that the Employee returns to employment with the
Employer within the period provided by law.
(8) BENEFICIARY: A person or persons (natural or
otherwise) designated in accordance with the provisions of Section 6.2(b)
to receive any death benefit which shall be payable under this Plan.
(9) BOARD OF DIRECTORS: The Board of Directors of the
Parent Company; provided, that action by the Executive Committee of the
Board of Directors of the Parent Company also shall be considered to be an
action of the Board of Directors for purposes of this Plan and Trust.
(10) BREAK IN SERVICE: A Break in Service shall occur
for any consecutive twelve month period after the Effective Date during
which an Employee fails to complete more than 500 Hours of Service due to a
termination of employment. For eligibility purposes, before an Employee
becomes a Participant, the Break in Service period shall be the consecutive
twelve month period beginning on the date of employment; provided, if an
Employee does not complete a Year of Service in the first twelve months of
employment, thereafter a Break in Service for eligibility shall be
determined on the basis of the Plan Year beginning with the first Plan Year
after his date of employment. In all other instances, the period used for
determining Breaks in Service for vesting, benefit accrual and retention of
eligibility shall be the Plan Year. A Break in Service shall not be deemed
to have occurred during any period of Authorized Leave of Absence if the
Employee returns to the employ of the Employer within the period of
authorized absence.
(11) CHANGE DATES: January 1, April 1, July 1, and
October 1. The Plan's Effective Date shall be a Change Date for the Plan's
first Plan Year. The Committee may designate different Change Dates for
different purposes, for example, fewer Change Dates may be designated to
reduce Salary Deferral Contributions than to increase Salary Deferral
Contributions.
(12) CODE: The Internal Revenue Code of 1986, as amended.
(13) COMMISSIONER: The Commissioner of Internal
Revenue. For purposes of this Plan, Commissioner also refers to the
Department of the Treasury with respect to official regulations and
pronouncements under the Code.
(14) COMMITTEE: The person or persons appointed under
the provisions of Article 8 to administer the Plan.
<PAGE>
(15) COMPENSATION:
(i) The total of all amounts paid to a
Participant by the Employer within the meaning of Code Section 3401(a) and
all other payments of compensation to a Participant by the Employer (in the
course of the Employer's trade or business) for which the Employer is
required to furnish the Participant a written statement under Code Sections
6041(d), 6051(a)(3) and 6052("Box 1" compensation on 1993 Form W-2) for the
calendar year ending with or within the Plan Year, and excluding
reimbursements or other expense allowances, fringe benefits (cash and
noncash), moving expenses, deferred compensation, income realized in
connection with the exercise of a stock option, and welfare benefits.
(ii) For Plan Years beginning prior to January 1,
1987, Compensation meant an Employee's Compensation and earnings from the
Employer, as defined in the Plan prior to this restatement.
(iii) For Plan Years beginning prior to January 1,
1989 in which the Plan is a Top-Heavy Plan, and for any Plan Year beginning
after December 31, 1988 but before January 1, 1994 (regardless of whether
the Plan is a Top-Heavy Plan), the Compensation taken into account for any
Employee shall not exceed $200,000 for any Plan Year (or such greater
amount as authorized by the Commissioner). For Plan Years beginning after
December 31, 1993, the Compensation taken into account for any Employee
shall not exceed $150,000 for any Plan Year (or such greater amount as
authorized by the Commissioner), regardless of whether the Plan is a
Top-Heavy Plan. In determining the Compensation of a Participant for
purposes of this adjusted $150,000 (or $200,000) limitation, the family
aggregation rules of Code 414(q)(6) shall apply, except that in applying
these rules, the term Family Member shall include only the spouse of a
Participant and any lineal descendants of a Participant who have not
attained age nineteen before the last day of the Plan Year. If the
adjusted $150,000 (or $200,000) limitation is exceeded as a result of the
application of this family aggregation rule, then the limitation shall be
prorated among the affected individuals in proportion to each such
individual's Compensation as determined under this section prior to the
application of this limitation.
(16) DETERMINATION DATE: The last day of the preceding
Plan Year (or, in the case of the first Plan Year of the Plan, the last day
of that first Plan Year).
(17) DIRECT ROLLOVER: A payment by the Plan to the
Eligible Retirement Plan specified by the Distributee.
(18) DISABILITY: A physical or mental condition which in
the judgment of the Committee, based upon medical reports and other
evidence satisfactory to the Committee, permanently prevents an Employee
from satisfactorily performing his usual duties for the Employer or the
duties of any other position or job which the Employer makes available to
him and for which such Employee is qualified by reason of his training,
education or experience.
<PAGE>
(19) DISTRIBUTEE: 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.
(20) DOMESTIC RELATIONS ORDER: An order as defined in
Section 6.7.
(21) EARLIEST RETIREMENT AGE: The date on which a
Participant becomes eligible to elect to receive normal retirement benefits
under Section 6.1.
(22) EFFECTIVE DATE: January 1, 1987, the date on which
the provisions of this amended and restated Plan became effective;
provided, that specific provisions of this Plan may be effective as of
other dates to the extent specifically stated in the Plan. The Original
Effective Date of this Plan is August 1, 1986.
(23) ELIGIBLE PARTICIPANT: With respect to any Plan
Year, a Participant who is eligible to make a Salary Deferral Contribution
or, prior to January 1, 1994, an Employee After-Tax Contribution, or to
receive a Matching Contribution under this Plan.
(24) ELIGIBLE RETIREMENT PLAN: 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; provided, that 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.
(25) ELIGIBLE ROLLOVER DISTRIBUTION: Any distribution of
all or any portion of the balance to the credit of the Distributee, except
that an Eligible Rollover Distribution does not include (i) 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; (ii) any
distribution to the extent such distribution is required under Code Section
401(a)(9); and (iii) 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).
(26) EMPLOYEE: Any person who, on or after the Effective
Date, is receiving remuneration for personal services rendered to the
Employer (or who would be receiving such remuneration except for an
Authorized Leave of Absence). Leased employees under Code Section 414
shall not be included in the definition of Employee for purposes of
Participation or benefit accrual under the Plan; provided, that such leased
employees shall be considered as employees for purposes of applying the
various tests under Code Sections 401, 404, 408(k) and 416, and Service as
<PAGE>
a leased employee shall be counted under the Plan for vesting purposes in
the event that a leased employee changes status so as to become eligible
for Participation under the Plan.
(27) EMPLOYER: Family Dollar Stores, Inc., a corporation
organized and existing under the laws of the State of Delaware, or its
successor or successors that assume Plan liabilities pursuant to Article
12, and any related corporation or entity which adopts this Plan.
(28) EMPLOYER CONTRIBUTION: Contributions (other than
Salary Deferral Contributions) made by the Employer pursuant to Section 4.1.
(29) EMPLOYER CONTRIBUTION ACCOUNT: The account
maintained to record a Participant's share of Employer Contributions under
Section 4.1, and adjustments relating thereto.
(30) ENTRY DATE: January 1, April 1, July 1, and October
1 of each Plan Year; provided that prior to April 1, 1988, the Plan's Entry
Dates were only April 1 and October 1 of each Plan Year, except that for
the sole purpose of determining Participation in the Plan under Section 3.1
(and not for deferral elections or changes under Article 4 or any other
purpose under the Plan), January 1 of each Plan Year also was an Entry Date.
(31) ERISA: Public Law No. 93-406, the Employee
Retirement Income Security Act of 1974, as amended from time to time.
(32) EXCESS CONTRIBUTIONS: With respect to any Plan
Year, the excess of:
(i) The aggregate amount of Matching
Contributions (plus any Salary Deferral Contribution or qualified
non-elective contributions taken into account in computing the ACP)
actually made for that Plan Year on behalf of a Highly Compensated
Employee, over
(ii) the maximum amount of such contributions
permitted under the limitations of Section 4.3(b), determined by reducing
such contributions made on behalf of Highly Compensated Employees in order
of their individual Actual Contribution Percentages beginning with the
highest such percentage.
(33) EXCESS DEFERRALS: With respect to any Plan Year,
the excess of:
(i) the aggregate amount of Salary Deferral
Contributions (plus such other Matching Contributions and other qualified
non-elective contributions taken into account under Code Section
401(k)(3)(D) in computing the ADP) actually paid over to the Trust for that
Plan Year on behalf of a Highly Compensated Employee, over
(ii) The maximum amount of such deferrals
permitted under the limitations of Section 4.3(a), determined by reducing
Salary Deferral Contributions made on behalf of Highly Compensated
<PAGE>
Employees in order of their individual Actual Deferral Percentages
beginning with the highest such percentage.
(34) FAMILY MEMBER: With respect to any individual, his
spouse and lineal ascendents or descendents, and the spouses of such lineal
ascendents and descendents.
(35) FIDUCIARIES OR NAMED FIDUCIARIES: The Employer, the
Committee, and the Trustee, but only with respect to the specific
responsibilities of each for Plan and Trust administration, all as
described in Section 8.1. If an Investment Manager is appointed as
provided in Section 8.1, it also shall be a Fiduciary.
(36) FIVE PERCENT OWNER: With respect to a Plan Year, an
owner of more than five percent of the outstanding stock (or an owner of
stock possessing more than five percent of the total combined voting power,
or an owner of more than five percent of the capital or profits interest of
an unincorporated business) of the Employer or of any one of the Aggregated
Employers (ownership in the Employer and Aggregated Employers not being
considered together). In determining ownership, the constructive ownership
rules of Code Section 416(i)(1)(B)(iii) shall apply.
(37) FORFEITURE: The portion of a Participant's Employer
Contribution Account which is forfeited under Section 6.3 below because of
termination of employment before full vesting.
(38) FORMER PARTICIPANT: A Participant whose employment
with the Employer has terminated but who has a vested account balance under
the Plan which has not been paid in full.
(39) 415 COMPENSATION: An Employee's compensation and
other earnings from the Employer as defined in Section 5.3(d) and (e) of
the Plan; provided, that for purposes of determining who is a Highly
Compensated Employee and/or Key Employee, 415 Compensation also shall
include elective or salary reduction contributions to a cash or deferred
arrangement, cafeteria plan, simplified employee pension or tax-sheltered
annuity pursuant to Code Sections 401(k), 125, 408(k) or 403(b).
(40) HIGHLY COMPENSATED EMPLOYEE: Any Employee of the
Employer who is a "highly compensated employee" as defined in Code Section
414(q) and the regulations thereunder. With respect to any Plan Year, such
definition generally shall include any Employee or former Employee who
during the Plan Year:
(i) was at any time a Five Percent Owner;
(ii) received 415 Compensation from the Employer
and all Aggregated Employers in excess of $75,000 (or greater amount
authorized by the Commissioner);
<PAGE>
(iii) both received 415 Compensation from the
Employer and all Aggregated Employers in excess of $50,000 (or greater
amount authorized by the Commissioner) and was in the Top Paid Group of
employees for such Plan Year; or
(iv) was at any time both an officer (as defined
and limited in the definition of Key Employee) and had 415 Compensation in
excess of fifty percent of the amount in effect under Code Section
415(b)(1)(A) for such Plan Year, provided that at least the one highest
paid officer shall always be taken into account for a Plan Year.
If any employee is a Family Member of (A) a Five Percent Owner or (B) a
Highly Compensated Employee who is in the group consisting of the ten
Highly Compensated Employees receiving the most 415 Compensation during the
Plan Year, then such Employee shall not be considered a separate employee,
but shall be aggregated with all his Family Members so that any 415
Compensation and any Plan contributions or benefits (including Salary
Deferral Contributions) are treated as if paid to or on behalf of one
single Highly Compensated Employee.
Notwithstanding the foregoing, this Plan has a calendar Plan Year
and has elected to use the "calendar year calculation election" described
in Section 1.414(q)-1T, Q&A 14(b) of the Commissioner's regulations and
thus need not consider the prior Plan year in determining who is a Highly
Compensated Employee. In the event that this Plan ceases to have a
calendar Plan Year, then an individual also will be a Highly Compensated
Employee if he met any of the above criteria during the prior Plan Year.
A former employee also shall be considered a Highly Compensated
Employee if he was a Highly Compensated Employee for the year of separation
from Service or for any Plan Year ending on or after the employee attains
age fifty-five.
(41) HOUR OF SERVICE or HOUR OF CREDITED SERVICE:
(i) Each hour during the applicable computation
period when the Employee is directly or indirectly paid or entitled to
payment by the Employer for the performance of duties for the Employer. An
Hour of Service also includes each hour for which an Employee is paid or
entitled to payment by the Employer 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 Authorized
Leave of Absence.
(ii) Hours of Service determined under the
preceding sentences shall include each hour for which back pay,
irrespective of mitigation of damages, has been awarded or agreed to by the
Employer; provided that (A) no more than 501 Hours of Service are required
to be credited to an Employee on account of any single continuous period
during which he performs no duties whether or not such period occurs in a
single computation period, (B) such hours will be credited to the Employee
for the computation period or periods to which the award or agreement
<PAGE>
pertains, (C) 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 will not be credited if such payment is on account of compliance
with worker's compensation or unemployment compensation or disability
insurance laws, and (D) hours will not be credited for payments which
solely reimburse an Employee for medical or medically related expenses
incurred by him.
(iii) In applying the rules of the preceding
sentences, the provisions of paragraphs (b) and (c) of Section 2530.200b-2
of the Department of Labor regulations shall apply and are incorporated
herein by reference.
(iv) For Employees for whom hours of work are
required to be maintained, credit for Hours of Service will be given on an
hour-for-hour basis as determined by employment records. For Employees
whose hours of work are not maintained, Hours of Service will be computed
using the following equivalencies:
<TABLE>
<CAPTION>
BASIS UPON WHICH CREDIT TO EMPLOYEE WHO EARNS
RECORDS ARE MAINTAINED ONE OR MORE HOURS OF SERVICE
DURING EACH COMPUTATION PERIOD
<S> <C>
Shift Hours for Full Shift
Daily 10 Hours of Service
Weekly 45 Hours of Service
Bi-Weekly 90 Hours of Service
Semi-Weekly 95 Hours of Service
Monthly l90 Hours of Service
</TABLE>
(v) Solely for purposes of determining whether a
Break in Service has occurred in a computation period for participation and
vesting purposes, an individual who is absent from work for a period by
reason of Maternity Leave (as defined in Section 2.1) shall receive credit
for the Hours of Service which otherwise would have been credited to such
individual but for the Maternity Leave (or, in any case in which the Plan
is unable to determine such Hours of Service, then eight Hours of Service
per day of Maternity Leave); provided that no more than 501 Hours of
Service shall be credited on account of any single period of Maternity
Leave and such Hours of Service shall be credited only (1) in the
computation period in which the Maternity Leave begins if the crediting is
necessary to prevent a Break in Service in that period, or (2) in all other
cases, in the immediately following computation period.
<PAGE>
(42) INCOME: The net gain or loss of the Trust Fund from
investments, as reflected by interest payments, dividends, realized and
unrealized gains and losses on securities, other investment transactions
and expenses paid from the Trust Fund. In determining the Income of the
Trust Fund for any period, assets shall be valued on the basis of their
fair market value. Amounts which are distributed to Participants as Excess
Contributions, Excess Deferrals, or excess amounts under Code Section
402(g) shall include Income for the Plan Year and any subsequent Valuation
Dates calculated under a reasonable method which does not discriminate in
favor of Highly Compensated Employees and which otherwise is in accordance
with the Commissioner's regulations under Code Sections 401(k), 401(m) and
402(g). No Income on Excess Deferrals, Excess Contributions or excess
amounts under Code Section 402(g) shall be attributed for any "gap period"
following the Valuation Date immediately preceding distribution.
(43) INSURER: Any legal reserve life insurance company
authorized to do business in the state where the Plan is domiciled which is
selected by the Committee to write insurance contracts to provide benefits
under the Plan.
(44) INVESTMENT MANAGER: A Fiduciary (other than the
Trustee or Named Fiduciary) who:
(i) has the power to manage, acquire or dispose
of any asset(s) of the Plan;
(ii) is (A) registered as an investment adviser
under the Investment Adviser Act of 1940, (B) a bank as defined in that
Act, or (C) an insurance company qualified to perform services described in
subparagraph (i) under the laws of more than one State; and
(iii) has acknowledged that he or it is a Fiduciary
with respect to the Plan.
(45) KEY EMPLOYEE: Any employee of the Employer or any
Aggregated Employer who is at any time during the Plan Year containing the
Determination Date, or was during any of the four preceding Plan Years, any
one or more of the following:
(i) A duly authorized officer of the Employer in
regular and continued service having 415 Compensation during the Plan Year
greater than fifty percent of the maximum dollar limitation under Code
Section 415(b)(1)(A) in effect for the calendar year containing the
Determination Date, provided that if during such Plan Year the number of
employees (whether or not Employees under the Plan) of the Employer plus
all other Aggregated Employers is:
(A) less than thirty, then no more than a
total of three individuals shall be considered officers for that Plan Year
for the Employer and all Aggregated Employers,
<PAGE>
(B) greater than thirty but less than
five hundred, then no more than a total of ten percent of the total
employees shall be considered officers for that Plan Year for the Employer
and all Aggregated Employers, or
(C) greater than five hundred, then no
more than a total of fifty employees shall be considered officers for hat
Plan Year for the Employer and all Aggregated Employers; or
(ii) One of the ten employees (whether or not
Employees under the Plan) owning the largest interest in the Employer and
Aggregated Employers during such Plan Year (the Employer and Aggregated
Employers being considered as one unit) if he has 415 Compensation during
the Plan Year of more than the maximum dollar limitation under Code Section
415(c)(1)(A) in effect for the calendar year containing the Determination
Date; provided that an employee need not be considered if he does not have
an ownership interest of more than one-half of one percent in value, and if
two employees have the same interest in the Employer and Aggregated
Employer, then the employee having the greater 415 Compensation from the
Employer and Aggregated Employers for the calendar year containing the
Determination Date shall be treated as having a larger interest; or
(iii) A Five Percent Owner; or
(iv) An owner of one percent of the outstanding
stock (or an owner of stock possessing one percent of the total combined
voting power) of the Employer or of any one of the Aggregated Employers
(ownership in the Employer and Aggregated Employers not being considered
together) for such Plan Year, if he has annual 415 Compensation during the
Plan Year from the Employer and all Aggregated Employers totalling more
than $150,000.
For purposes of determining ownership under subsections (ii), (iii) and
(iv) above, the constructive ownership rules of Code Section 318 shall
apply as modified by Code Section 416(i), which modifications include a
requirement that the ownership rules of Code Section 414(b), (c), and (m)
do not apply in determining ownership (i.e., so that an individual will be
considered a 1% or 5% owner of all related corporations and entities if he
is a 1% or 5% owner of any one related corporation or entity considered by
itself). The beneficiary of a former Key Employee shall continue to be
treated as such former Key Employee. If a maximum number of employees are
to be considered officers under subsection (i) above, the officers having
the largest annual 415 Compensation during such Plan Year shall be the
officers considered under subsection (i).
(46) LIMITATION YEAR: The Limitation Year shall be the
twelve month period ending on each Anniversary Date.
(47) MATCHING CONTRIBUTION: An Employer Contribution
which is allocated to the Participant's Employer Contribution Account by
reference to the Participant's Salary Deferral Contributions for that Plan
Year pursuant to Section 4.1.
<PAGE>
(48) MATERNITY LEAVE: Absence from work for maternity or
paternity reasons by an individual (male or female) on account of and by
reason of (i) the pregnancy of the individual, (ii) the birth of a child of
the individual, (iii) the placement of a child with the individual in
connection with the adoption of such child by such individual, or (iv)
caring for a child referred to above for a period beginning immediately
following such birth or placement. A period of absence shall not be
considered Maternity Leave for purposes of this Plan unless both (A) such
absence began on or after the first day of the first Plan Year beginning
after December 31, 1984, and (B) the individual furnishes the Committee
such timely information as the Plan reasonably may require to establish
that the absence from work is for one of the reasons referred to above and
the number of days for which there was such an absence. The determination
of whether an individual has taken a Maternity Leave for purposes of this
Plan shall not have any effect upon whether such absence from work is
entitled to any other special treatment by the Employer for any other
employment purposes, and the existence of these Maternity Leave provisions
in the Plan shall not be in any way determinative of whether the Employer
has any other maternity or paternity leave policy or the terms of that
policy (if any).
(49) NON-HIGHLY COMPENSATED EMPLOYEE: Any Participant
who is neither a Highly Compensated Employee nor a Family Member of a
Highly Compensated Employee.
(50) NONKEY EMPLOYEE: Any employee (or former employee)
of the Employer or any Aggregated Employer who is not a Key Employee. The
beneficiary of a Nonkey Employee or a former Nonkey Employee shall continue
to be treated as such Nonkey Employee or former Nonkey Employee.
(51) NORMAL RETIREMENT AGE: The date a Participant
attains age sixty-five.
(52) PARENT COMPANY: Family Dollar Stores, Inc., a
corporation organized and existing under the laws of the State of Delaware,
or its successor or successors.
(53) PARTICIPANT: An Employee participating in the Plan
in accordance with the provisions of Section 3.1, provided, that for
purposes only of making or transferring a rollover contribution to the Plan
under Section 4.4, an Employee shall be considered a Participant on the
date he has completed thirty days of Service with the Employer.
(54) PARTICIPATION: The period commencing on the date
the Employee becomes a Participant and ending on the date his employment
with the Employer terminates.
(55) PAYMENT STARTING DATE: The latest date until which
the Plan may delay payment of benefits to a Participant in the absence of
the Participant's consent to later payment. Such date shall be the
sixtieth day after the close of the Plan Year in which the last of the
following events occurs: (i) the Participant attains Normal Retirement
<PAGE>
Age, (ii) the tenth anniversary of the year in which the Participant
commenced Participation in the Plan, or (iii) the Participant terminates
his Service with the Employer; provided that benefits also must commence
not later than April 1 of the calendar year following the calendar year in
which a Participant attains age seventy and one-half, even if he is still
employed by the Employer, except as may otherwise be allowable under
Section 242(b)(2) of the Tax Equity and Fiscal Responsibility Act of 1982
and Section 521 of the Deficit Reduction Act of 1984 (regarding special
designations filed before January 1, 1984), and except as may otherwise be
allowable under Section 1121(d) of the Tax Reform Act of 1986 (regarding
Participants, other than certain Five Percent Owners, who reached age
seventy and one-half before January 1, 1988 and certain collective
bargaining agreements). If the amount of payment cannot be determined or
the proper recipient located before the Payment Starting Date, retroactive
payment may be made to such date in accordance with Treasury Regulation
Section 1.401(a)-14(d).
(56) PLAN: Family Dollar Employee Savings and Retirement
Plan and Trust, the Plan set forth herein, as amended from time to time.
(57) PLAN ADMINISTRATOR: The Committee appointed
pursuant to Section 8.2 or, in the absence of such appointment, the Parent
Company.
(58) PLAN YEAR: The consecutive twelve month period
commencing on January 1 and ending on the following December 31.
(59) PRESENT VALUE OF ACCRUED BENEFITS: With respect to
any individual and as of any Determination Date, the sum of (i) his
Employer Contribution Account and Salary Deferral Account balances on the
most recent Valuation Date (which for the first Plan Year of the Plan shall
include contributions made after the Determination Date which are allocated
as of a date in the first Plan Year, but otherwise shall only include
allocated contributions which actually were made after the Valuation Date
if such contributions were made on or before the Determination Date), and
(ii) his Rollover Account balance (if any) as of the most recent Valuation
Date to the extent it is attributable to any rollover contribution from a
plan of an Aggregated Employer and/or any rollover contribution accepted on
or before December 31, 1983. For purposes of determining whether the Plan
is a Top-Heavy Plan, the Present Value of Accrued Benefits also shall
include the amount of Plan distributions (whether made on or after the
Effective Date and including distributions from a terminated plan which
would have been required to be aggregated under the definition of Top-Heavy
Plan) made within the five consecutive Plan Year period ending on the
Determination Date to any Key Employee or Nonkey Employee or Beneficiary
thereof (regardless of whether such individual is employed or has an
accrued benefit as of the Determination Date); provided, that distributions
of benefits paid on account of death shall be deemed to include only the
present value of benefits existing immediately prior to death. If an
individual has not performed an Hour of Service for any employer
maintaining the Plan at any time during the five year period ending on the
Determination Date, any account balance or accrued benefit for such
individual shall be disregarded.
<PAGE>
(60) QUALIFIED DOMESTIC RELATIONS ORDER: An order as
defined in Section 6.7.
(61) ROLLOVER ACCOUNT: The account established pursuant
to Section 4.4 hereof to record permissible rollover contributions from
another qualified plan or an Individual Retirement Account and adjustments
relating thereto.
(62) SALARY DEFERRAL ACCOUNT: The account maintained to
record a Participant's Salary Deferral Contributions and adjustments
relating thereto.
(63) SALARY DEFERRAL CONTRIBUTIONS: Contributions
elected to be made by a Participant pursuant to Section 4.2 of the Plan.
(64) SERVICE: A Participant's period of employment with
the Employer.
(65) SUPER TOP-HEAVY PLAN: The Plan will be a Super
Top-Heavy Plan with respect to any Plan Year in which as of the
Determination Date it is a Top-Heavy Plan in which the Present Value of
Accrued Benefits for Key Employees exceeds ninety percent of the Present
Value of Accrued Benefits for all Key Employees and Nonkey Employees who
are or were Plan Participants. In determining whether a Plan is a Super
Top-Heavy Plan, all the rules of determining whether the Plan is a
Top-Heavy Plan shall be applied except that "ninety percent" shall be
substituted for "sixty percent."
(66) SURVIVING SPOUSE: The surviving spouse of a
Participant, but only if the Participant and that spouse had been married
throughout the one year period ending on the earlier of (a) the
Participant's Payment Starting Date or (b) the date of the Participant's
death. If a Participant marries within one year before his Payment
Starting Date and the Participant and his spouse in such marriage have been
married for at least a one year period ending on or before the date of his
death, such Participant and his spouse also shall be treated as having been
married throughout the one year period ending on the Participant's Payment
Starting Date. A former spouse of a Participant will be treated as a
Surviving Spouse to the extent it specifically is provided under a
Qualified Domestic Relations Order as described in Article 6 of this Plan
and Code Section 414(p).
(67) SUSPENSE ACCOUNT: The account maintained for the
Trustee to record any part of the Employer Contribution which is an excess
Annual Addition under Section 5.3 of the Plan and adjustments relating
thereto.
(68) TOP-HEAVY PLAN: The Plan will be a Top-Heavy Plan
with respect to any Plan Year in which as of the Determination Date the
Present Value of Accrued Benefits under the Plan for all Key Employees
exceeds sixty percent of the Present Value of Accrued Benefits for all Key
Employees and Nonkey Employees who are or were Plan Participants; provided,
that if any individual is a Nonkey Employee with respect to any Plan Year
but was a Key Employee with respect to any prior Plan Year, the Present
Value of Accrued Benefits for such individual shall not be taken into
<PAGE>
account in determining whether the Plan is a Top-Heavy Plan. In
determining whether the Plan is a Top-Heavy Plan, the Plan shall be
aggregated with each plan of an Employer or Aggregated Employer in which a
Key Employee is a participant, with each terminated plan whose benefits are
included in determining the Present Value of Accrued Benefits, and with
each other plan of an Employer or Aggregated Employer which enables any
such plan to meet the requirements of Code Sections 401(a)(4) or 410, and
may be aggregated with any or all other plans of an Employer or Aggregated
Employer if such aggregation group would continue to meet the requirements
of Code Sections 401(a)(4) and 410 with such plan being taken into
account. If the Plan must or may be aggregated with any other plan, the
top-heavy ratio for the aggregated group shall be determined by adding
together the numerators for each plan, and then adding together the
denominators for each plan.
(69) TOP-HEAVY YEAR OF SERVICE: A Year of Service
completed in a Plan Year for which the Plan is a Top-Heavy Plan.
(70) TOP PAID GROUP: For any Plan Year, the group
consisting of the top twenty percent of employees who performed services
for the Employer during the Plan Year when ranked on the basis of 415
Compensation paid during such year, determined as provided in Code Section
414(q) and regulations issued thereunder. All active employees and leased
employees under Code Section 414(n) shall be counted in determining the Top
Paid Group, without any exclusion for age or service or collective
bargaining employees, except that employees who are non-resident aliens
with no United States source income shall be excluded.
(71) TRUST or TRUST FUND: The fund known as the Family
Dollar Employee Savings and Retirement Plan and Trust, maintained in
accordance with the terms of the Trust Agreement, as from time to time
amended, which constitutes a part of this Plan.
(72) TRUSTEE: The corporation or individuals appointed
by the Board of Directors to administer the Trust. For purposes of this
Agreement, the Trustees shall be George R. Mahoney, Jr. and, effective
December 26, 1991, C. Martin Sowers and effective November 10, 1994, John
D. Reier, until changed as herein provided.
(73) VALUATION DATE: The Anniversary Date in each Plan
Year, December 31, plus any other interim dates during the Plan Year which
the Committee designates as Valuation Dates. Additional Valuation Dates
may be designated by the Committee at any time, and if designated shall
apply for all purposes under the Plan (including pending distributions).
(74) YEAR OF SERVICE:
(i) A Year of Service for eligibility means a
consecutive twelve month period in which an Employee completes at least
1,000 Hours of Service. The first consecutive twelve month period and all
succeeding periods shall be measured from the first day the Employee is
entitled to be credited with an Hour of Service and succeeding consecutive
twelve month periods thereafter.
<PAGE>
(ii) A Year of Service for vesting means a
consecutive twelve month period coincidental with the Plan Year in which an
Employee completes l,000 Hours of Service.
(iii) A Year of Service shall not be credited for
any Authorized Leave of Absence after the Employee incurs a Break in
Service during such absence from the employ of the Employer.
(iv) Years of Service completed prior to the
Original Effective Date of the Plan shall be considered for purposes of
eligibility and vesting under the Plan. With respect to Service completed
prior to the Original Effective Date, if the Employer has not maintained
records sufficient to determine precisely the number of Hours of Service
completed during each computation period, then the Employee shall be
assumed to have worked continuously during any period of employment, and
shall be credited with Hours of Service based on the equivalency under the
definition of Hours of Service for the computation period used for him on
the Original Effective Date.
(v) Years of Service following reemployment shall
be determined in accordance with Section 3.4.
2.2 Construction: The masculine gender, where appearing in the
Plan, shall be deemed to include the feminine gender, unless the context
clearly indicates to the contrary. The words "hereof," "herein,"
"hereunder" and other similar compounds of the word "here" shall mean and
refer to the entire Plan and not to any particular provision or Section.
2.3 Governing Law: This Plan and Trust shall be governed to the
maximum extent by federal law under ERISA. To the extent not so preempted
or otherwise governed by ERISA, the laws of the State of North Carolina
shall control on all other matters.
2.4 Effect of Restatement: If the Plan and Trust's restatement
as of January 1, 1987 fails to qualify under the Code upon its submission
to the Internal Revenue Service, the Employer may elect to make further
amendments as requested by the Internal Revenue Service or, alternatively,
to withdraw this restatement, return any Salary Deferral Contributions to
the Participant, and continue to operate the Plan and Trust under the
documents in effect prior to the restatement.
<PAGE>
ARTICLE 3. PARTICIPATION AND SERVICE
3.1 Participation: An Employee included under the prior
provisions of the Plan prior to this restatement shall continue to
participate in accordance with the provisions of this amended and restated
Plan. Each other Employee shall be eligible to participate as of the first
Entry Date on or after the date on which he both attains age twenty-one and
completes one Year of Service (provided that the Employee is still in the
Employer's Service on such Entry Date).
3.2 Service: A Participant's eligibility for benefits under the
Plan shall be based on his period of Service, determined in accordance with
the following: Subject to Section 3.4, a Participant shall accrue a Year
of Service for each Plan Year (or twelve month initial eligibility period
under the conditions described in paragraph (i) of the definition of Year
of Service in Article 2) in which he has 1,000 or more Hours of Service.
3.3 Inactive Status: In the event that any Participant shall
fail, in any Plan Year of his employment after the Effective Date, to
accumulate 1,000 Hours of Service, such Plan Year shall not be considered
as a period of Service for the purpose of determining the Participant's
vested interest in accordance with Section 6.3 (except as may otherwise be
provided in the Plan's definition of Year of Service), but he shall
continue to receive Income allocations in accordance with Section 5.2(a)
and shall share in Employer Contributions if otherwise eligible under
Section 5.2(c).
3.4 Participation and Service Upon Reemployment:
(a) Participation Ceases Upon Termination of
Employment: Participation in the Plan shall cease upon termination of
employment with the Employer. Such termination of employment may have
resulted from retirement, death or voluntary or involuntary termination of
employment, unauthorized absence, or by failure to return to active
employment with the Employer by the date on which an Authorized Leave of
Absence expired.
(b) Special Rules Regarding Reemployment: Upon the
reemployment of any person who had previously been employed by the
Employer, the following rules shall apply in determining his Participation
in the Plan and his Service under Section 3.2:
(1) Plan Participation:
(i) Employee Who Had Not Been a
Participant: If the reemployed Employee was not a Participant in the Plan
during his prior period of employment, he shall commence Participation
after he has met the requirements of Section 3.1 as if he were a new
Employee; provided that, any Service attributable to his prior period of
employment shall be taken into account for such reemployed Employee unless
the number of consecutive one-year Breaks in Service equals or exceeds the
greater of (A) five or (B) the aggregate number of Years of Service before
the consecutive Breaks in Service (such aggregate number not including
Years of Service disregarded by reason of prior periods of Breaks in
Service);
<PAGE>
(ii) Employee Who Had Been a Participant:
If the reemployed Employee was a Participant in the Plan during his prior
period of employment or if the reemployed Employee had completed the
eligibility requirements but had not yet become a Participant (for instance
due to an Entry Date adjustment), he shall be entitled to reparticipate in
the Plan on his date of reemployment for all purposes; provided, that his
ability to elect to make Salary Deferral Contributions shall be subject to
the Plan's normal rules and procedures which may delay the election of
making Salary Deferral Contributions to the next Change Date.
(2) Computation of Service for Vesting Purposes:
(i) Employee Who Previously Had Vested
Interest: In the case of a reemployed Employee whose prior employment
terminated while he was a Participant with any vested interest in his
Employer Contribution Account or his Salary Deferral Account under Article
6, any Service attributable to his prior period of employment shall be
reinstated as of the date of his reparticipation.
(ii) Employee Without Previous Vested
Interest: In the case of a reemployed Employee who was a Participant whose
prior employment terminated without a vested interest in his Employer
Contribution Account or his Salary Deferral Account under Article 6, any
Service which is attributable to his prior period of employment shall be
taken into account unless the number of consecutive one-year Breaks in
Service equals or exceeds the greater of (i) five or (ii) the aggregate
number of Years of Service before the consecutive Breaks in Service (such
aggregate number not including Years of Service disregarded by reason of
prior periods of Breaks in Service).
<PAGE>
ARTICLE 4. CONTRIBUTIONS AND FORFEITURES
4.1 Employer Contributions and Salary Deferral Contributions:
The Employer in its discretion may, for each year, contribute an amount it
determines. Such amount shall not exceed the lesser of the following
amounts:
(a) The amount which is elected to be deferred by
Participants as Salary Deferral Contributions under Section 4.2 plus any
additional amount contributed as an Employer Contribution by the Employer
in the discretion of its Board of Directors; or
(b) Fifteen percent of all 415 Compensation (which
excludes amounts deferred pursuant to Code Section 401(k)) paid or accrued
in the Plan Year to all Participants in the employ of the Employer who are
eligible to receive an allocation to their accounts in accordance with the
provisions of Section 5.2, plus any contribution carryover, pre-1987
limitation carry forward, or other amounts permitted (even if not
deductible) under Code Section 404(a), and less any Employer Contributions
or Employee pre-tax contributions to any other profit sharing plan or Code
Section 401(k) plan of the Employer.
All contributions of the Employer shall be made in cash or other
property permitted by ERISA, and shall be conditioned upon their
deductibility under Code Section 404 and shall be paid to the Trustee, and
payments shall be made not later than the date prescribed by law for filing
the Employer's federal income tax returns, including extensions which have
been granted for the filing of such tax returns; provided, that Salary
Deferral Contributions made pursuant to Participants' elections under
Section 4.2 shall be paid to the Trustee on the earliest date on which such
contributions can reasonably be segregated from the Employer's general
assets but not later than ninety days after the date on which the deferred
amount otherwise would have been payable to the Participant (or such longer
period permitted by the Commissioner or under ERISA). Contributions of the
Employer which are determined to be nondeductible shall be returned to the
Employer in accordance with Section 7.1.
4.2 No Employee After-Tax Contributions by Participants:
Effective on and after January 1, 1994, Participants are not required or
permitted to make any after-tax contributions to this Plan.
4.3 Participant's Election to Make Salary Deferral Contributions:
(a) Election: By written election, made and filed with
the Committee pursuant to the Committee's rules and regulations and prior
to the Change Date at which such election is to take effect, a Participant
may elect to have a whole percentage between two percent and eighteen
(fourteen, prior to January 1, 1988) percent (or such higher or lower
percentage as may be allowed by the Committee's rules or regulations) of
his Compensation contributed as a Salary Deferral Contribution to the
Plan. As an administrative matter, in calculating the amount to be
withheld from a Participant's periodic pay as a Salary Deferral
Contribution, the Committee may adopt rules and procedures whereby the
<PAGE>
amount of periodic withholding is determined by using a dollar figure or by
using a percentage of base pay or of some other amount which is not
identical to Compensation; provided, that for purposes of applying the
various nondiscrimination and other tests required by the Code, the
definition of Compensation will still be utilized.
(b) General $7,000 Limitation on Salary Deferral
Contributions: Notwithstanding the foregoing, for Plan Years beginning
after December 31, 1986, no Participant's Salary Deferral Contributions to
this Plan and any other cash or deferred arrangement of any employer may
exceed $7,000 for any taxable year (i.e., generally the calendar year) of
the Participant. The foregoing $7,000 limitation shall be adjusted
automatically each year to reflect cost-of-living adjustments announced by
the Commissioner. Amounts contributed by a Participant in excess of such
limit (plus Income attributable thereto through the most recent Valuation
Date) may be distributed by the Plan to that Participant in accordance with
Code Section 402(g)(2) on or before April 15 of the following calendar
year; provided, that the Plan need not make such distribution unless so
requested in writing by the affected Participant on or before March 1 of
the following calendar year, but if not distributed, any amount contributed
in excess of the amount permitted under Code Section 402(g) shall be
considered an after-tax employee contribution, credited to the affected
Participant's Employee After-Tax Contribution Account, and thereafter
separately accounted for under the Plan. Such distributed or redesignated
amounts nevertheless shall continue to be considered for Highly Compensated
Employees (but not for Non-Highly Compensated Employees) for purposes of
the Plan's Actual Deferral Percentage.
(c) Modification or Revocation of Elections: Once made,
elections under this Section 4.3 may not be modified except with regard to
the Change Date at least 30 days subsequent to the filing of a written
notice with the Committee, or except as otherwise allowed by the
Committee. Elections under this Section 4.3 may not be revoked and Salary
Deferral Contributions discontinued except with regard to a date at least
thirty days subsequent to the filing of a written notice with the Committee
(or at such other time allowed under the Committee's rules and
procedures). If Salary Deferral Contributions are so discontinued, they
may not be resumed by that Participant until the following Change Date
designated by the Committee for that purpose. The Committee may develop
rules and procedures regarding Change Dates and the modification or
revocation of elections, which rules and procedures may discriminate
against Highly Compensated Employees.
(d) Withdrawal and Distribution: A Participant may
request to have an in-service withdrawal from his Salary Deferral Account
only in accordance with Section 6.5. Upon termination of employment, the
Salary Deferral Account shall be distributed in accordance with Article 6.
4.4 Limitations on Salary Deferral Contributions and on Matching
Contributions:
(a) Special Rules Limiting Salary Deferral Contributions
under Code Section 401(k):
<PAGE>
(1) Upon receipt of all Salary Deferral elections
at the adoption of the Plan, and periodically thereafter (but no less
frequently than twice a year as of the Anniversary Date each Plan Year and
the date six months prior thereto), the Employer shall check the Actual
Deferral Percentages against the tests set forth in Subsection (4) below.
The Committee shall formulate limits and rules regarding the percentage of
Compensation which may be deferred by Participants to the extent it deems
necessary or desirable in order to meet one of the tests. Any such limits
and rules may discriminate against Participants who are Highly Compensated
Employees.
(2) In the event that neither test in Subsection
(4) is met as of the last day of any Plan Year, the Committee shall:
(i) Request that the Employer make an
additional contribution to the Plan, which contribution shall be allocated
among Salary Deferral Accounts in one of the following manners, as
specified by the Committee: (A) as if it were an additional Matching
Contribution allocated based upon some stated amount of Salary Deferral
Contributions, either among all Participants or just among those
Participants who are Non-Highly Compensated Employees; or (B) in the
proportion that each Participant's Compensation bears to the total
Compensation of all affected Participants, with such additional
contribution either being made with respect to all Participants or just
among those Participants who are Non-Highly Compensated Employees.
(ii) In addition to or as an alternative
to the foregoing, the Committee may request that the Employer designate
that all or part of the Matching Contribution which it will put into the
accounts of either all Participants or just those Participants who are
Non-Highly Compensated Employees be allocated to such Participants' Salary
Deferral Accounts.
(iii) In addition to or as an alternative
to the foregoing, the Committee may in its discretion require that
Participants who are Highly Compensated Employees be required to amend
their Salary Deferral percentage elections and/or to elect to receive as a
cash distribution under Code Section 401(k)(8) Excess Deferrals already
contributed to the Plan with respect to the Plan Year, plus any Income
attributable thereto (computed in accordance with the Trustee's usual
procedures for allocating Income to Participant's accounts); provided that
the foregoing alternative of cash election shall not be available for Plan
Years beginning prior to January 1, 1987. If any Salary Deferral
Contributions are distributed pursuant to this Section, any Matching
Contributions allocated to the Participant's Employer Contribution Account
by reference to those Salary Deferral Contributions also must be
distributed (if such Matching Contributions are vested) or forfeited (if
such Matching Contributions are not vested) as required to comply with
Section 401(a) of the Commissioner's regulations. In all events, the
Committee's determination as to which Participants will be affected under
this subparagraph (iii) shall be determined by reducing the deferrals of
Participants who are Highly Compensated Employees in order of their Actual
Deferral Percentages, beginning with the highest such percentage during
that Plan Year. Any cash distributions under the foregoing sentence shall
be treated as if they had never been deferred to the Plan under Section 4.2.
<PAGE>
(3) The timing of any corrective measures under
Subsection (2) above should be as follows: (i) any additional amounts
contributed pursuant to Subsection (2)(i) or (ii) above shall be deposited
in the affected Participants' Salary Deferral Accounts no later than the
date prescribed by law for filing the Employer's federal income tax
returns, including extensions which have been granted for the filing of
such tax return; and (ii) any cash distribution of Excess Deferrals
pursuant to Subsection (2)(iii) above must be made to the appropriate
Highly Compensated Employees after the close of the Plan Year in which the
Excess Deferral arose and within twelve months after the close of that Plan
Year.
(4) As of each Anniversary Date (and more
frequently as deemed necessary by the Committee), all Participants who were
directly or indirectly eligible to make a Salary Deferral for all or a
portion of the Plan Year shall be separated into the Highly Compensated
Employee group (including Family Members of Highly Compensated Employees)
and the Non-Highly Compensated Employee group. One of the following two
tests must be satisfied as of each Anniversary Date for there not to be a
further Employer Contribution and/or amendment of salary deferral elections
and/or required cash election by Highly Compensated Employees under
Subsection (2) above:
Test I - the Actual Deferral Percentage for
the Highly Compensated Employee group is not
more than the Actual Deferral Percentage of
the Non-Highly Compensated Employee group for
the same Plan Year multiplied by 1.25.
Test II - the excess of the Actual Deferral
Percentage for the Highly Compensated
Employee group over the Non-Highly
Compensated Employee group for the same Plan
Year is not more than two percentage points,
and the Actual Deferral Percentage for the
Highly Compensated Employee Group is not more
than the Actual Deferral Percentage of the
Non-Highly Compensated Employee group
multiplied by 2.0.
Notwithstanding the foregoing, the use of Test II shall be limited to the
extent necessary in order to avoid any restrictions on the use of this
"alternative limitation" which have been promulgated by the Commissioner,
as further described in Subsection (b)(5) below.
(5) Each group's Actual Deferral Percentage and
Test I and Test II shall be determined in accordance with Code Section
401(k) and any related rules or regulations of the Commissioner.
(b) Special Rules Limiting Matching Contributions:
(1) At the adoption of the Plan, and periodically
thereafter (but not less frequently than twice a year as of the Anniversary
Date each Plan Year and the date six months prior thereto), the Employer
<PAGE>
shall check the Actual Contribution Percentages against the tests set forth
in Subsection (4) below. The Committee may formulate limits and rules
regarding the contribution and/or allocation of any Employee After-Tax
Contributions and Matching Contributions to the extent it deems necessary
or desirable in order to meet one of the tests. Any such limits and rules
may discriminate against Participants who are Highly Compensated Employees.
(2) In the event that neither test in Subsection
(4) is met as of the last day of any Plan Year, the Committee shall:
(i) Request that the Employer make an
additional Matching Contribution to the Plan, which contribution shall be
allocated among Employer Contribution Accounts as an additional Matching
Contribution allocated based upon some stated amount of Salary Deferral
Contributions either among all Participants or just among those
Participants who are Non-Highly Compensated Employees; or
(ii) In addition to or as an alternative
to the foregoing, the Committee may, in its discretion, require that
Participants who are Highly Compensated Employees be required to elect to
receive as a cash distribution under Code Section 401(m)(6) any Excess
Contributions of vested Matching Contributions already contributed to the
Plan with respect to the Plan Year, plus any Income attributable thereto
(computed in accordance with the Trustee's usual procedures for allocating
Income to Participant's accounts). In all events, the Committee's
determination as to which Participants will be affected shall be determined
under this subparagraph (ii) by reducing the Matching Contributions by or
on behalf of Participants who are Highly Compensated Employees in order of
their Actual Contribution Percentages, beginning with the highest such
percentage during that Plan Year. Any cash distributions under the
foregoing sentence shall be treated as if they had never been contributed
to the Plan under Section 4.1.
(iii) In addition to or as an alternative
to the foregoing, the Committee may require that non-vested Matching
Contributions be forfeited to correct Excess Contributions.
(3) The timing of any corrective measures under
Subsection (2) above shall be as follows: (i) any additional amount to be
contributed pursuant to Subsection (2)(i) above shall be deposited in the
affected Participants' Employer Contribution Accounts no later than the
date prescribed by law for filing the Employers' federal income tax return,
including extensions which have been granted for the filing of such tax
return; and (ii) any cash distribution of Excess Contributions of Matching
Contributions pursuant to Subsection (2)(ii) above must be made to the
appropriate Highly Compensated Employees after the close of the Plan Year
in which the Excess Contribution arose and within twelve months after the
close of that Plan Year.
(4) As of each Anniversary Date (and more
frequently as deemed necessary by the Committee), all Participants shall be
divided into the Highly Compensated Employee group (including Family
Members of Highly Compensated Employees) and the Non-Highly Compensated
<PAGE>
Employee group. One of the following two tests must be satisfied as of
each Anniversary Date for there not to be a further Employer Matching
Contribution and/or required cash election by Highly Compensated Employees
under Subsection (2) above:
Test I - the Actual Contribution Percentage
for the Highly Compensated Employee group is
not more than the Actual Contribution
Percentage of the Non-Highly Compensated
Employee group multiplied by 1.25.
Test II - the excess of the Actual
Contribution Percentage for the Highly
Compensated Employee group over the
Non-Highly Compensated Employee group is not
more than two percentage points, and the
Actual Contribution Percentage for the Highly
Compensated Employee group is not more than
the Actual Contribution Percentage of the
Non-Highly Compensated Employee group
multiplied by 2.0.
Notwithstanding the foregoing, the use of Test II shall be limited to the
extent necessary in order to avoid any restrictions on the use of this
"alternative limitation" which have been promulgated by the Commissioner,
as described in Subsection (5) below.
(5) Restriction on Multiple Use of Test II: The
following restrictions shall apply in any case where the Plan is required
to use Test II for computing both the maximum ADP and ACP limitations for
Highly Compensated Employees. In such case, the sum of the ADP and ACP for
Highly Compensated Employees may not exceed the greater of (i) or (ii)
below:
(i) the sum of:
(A) 1.25 times the greater of the
ADP or the ACP for Non-Highly Compensated Employees, plus
(B) 2.0 times the lesser of the
ADP or the ACP for Non-Highly Compensated Employees, provided that this
figure may not exceed the lesser of the ADP or the ACP for Non-Highly
Compensated Employees by more than two percentage points.
(ii) the sum of:
(A) 1.25 times the lesser of the
ADP or the ACP for Non-Highly Compensated Employees, plus
(B) 2.0 times the greater of the
ADP or the ACP for Non-Highly Compensated Employees, provided that this
figure may not exceed the greater of the ADP or the ACP for Non-Highly
Compensated Employees by more than two percentage points.
<PAGE>
In the event that such aggregate limitation is exceeded, correction shall
be made by reducing the ACP for Highly Compensated Employees in accordance
with this Subsection (b) to the extent necessary to meet this aggregate
limitation.
(6) Each group's Actual Contribution Percentage
and Test I and Test II shall be determined in accordance with Code Section
401(m) and any related rules and regulations of the Commissioner.
4.5 Rollover Contributions:
(a) In General: Subject to all the provisions of this
Plan, a Participant may direct the appropriate fiduciary of any qualified
retirement plan of another employer to distribute or transfer directly to
the Trustee any portion or all of such Participant's interest in the
distributing or transferring plan, exclusive of contributions made by the
Participant thereunder except that a Participant may rollover into this
Plan employee contributions deductible under Code Section 219(e)(2) to the
extent such amounts are thereafter accounted for separately and also may
rollover elective contributions considered employer contributions under
Code Section 401(k). Alternatively, the Participant may personally present
such amount to the Trustee within sixty days of receipt thereof as a
distribution from another qualified retirement plan. In addition, an
Employee who has become a Participant who has established an Individual
Retirement Account solely for the purpose of serving as a repository for
distributions from the qualified retirement plan of a former employer, and
who has not made any contributions to such Individual Retirement Account on
his own behalf also may transfer or present within sixty days of receipt
part or all of the assets of such Individual Retirement Account to the
Trustee.
Upon the receipt of such a rollover contribution, the
Trustee shall establish a Rollover Account for the Participant on whose
behalf the distribution was received. The value of the Rollover Account so
established shall be fully vested and nonforfeitable at all times.
(b) Requirements and Conditions With Respect to Rollover
Contributions: Rollover contributions shall further be subject to the
following conditions:
(1) No Interim Withdrawals: No withdrawals from
Rollover Accounts shall be permitted until such time as the Participant is
otherwise eligible to receive his vested interest attributable to Employer
Contributions (or would have been eligible had he been vested in any part
of his Employer Contribution Account) or until such earlier time permitted
under Section 6.5.
(2) Certification: The Participant shall at the
Committee's request present a written certification in a form acceptable to
the Committee to the effect that: The amount received as a rollover
contribution is attributable only to amounts to the Participant's credit in
a qualified retirement plan or rollover Individual Retirement Account; no
portion of such amount consists of contributions made by the Participant
other than employee contributions deductible under Code Section 219(e)(2)
and elective contributions considered employer contributions under Section
<PAGE>
401(k); specifying any amounts transferred which are subject to any
restrictions under Code Section 401(a)(9) or Section 402(c)(4) or
otherwise; and if such amount is being paid by the Participant personally,
it was received within the prior sixty calendar days.
(3) Participation for Purposes of this Section:
For the sole purpose of determining whether an Employee has become eligible
to utilize these rollover provisions, and not for any other purpose under
the Plan, an Employee shall be considered a Plan Participant on the date he
has completed thirty days of Service with the Employer.
(4) Other Limitations: No rollover contribution
shall be accepted (i) directly or indirectly from an Individual Retirement
Account to which the Participant contributed on his own behalf; or (ii)
which consists in whole or in part of insurance contract(s) with respect to
which future premium payments are or may become due, unless there are
sufficient other assets being transferred so as to make maintenance of such
contract(s) feasible without violation of any limitation on assets which
may be applied for that purpose; or (iii) which consists of amounts not
eligible for rollover treatment under Code Section 402(c)(4) because such
amounts were part of a series of payments or required to be distributed
under Code Section 401(a)(9).
(5) No Transfer Allowed from Plan Subject to Code
Section 417: No direct or indirect transfer will be permitted into this
Plan from (i) a plan which is a defined benefit pension plan, (ii) a
defined contribution plan subject to the minimum funding standards of Code
Section 412 (e.g., a money purchase or target benefit pension plan), or
(iii) any other defined contribution plan that does not meet the
requirements of Code Section 401(a)(11)(B)(iii)(I) and (II) regarding all
death benefits being paid to a Surviving Spouse absent spousal consent and
regarding the Participant's ability to elect a life annuity form of
payment. Rollovers into this Plan which are not direct or indirect
transfers (i.e., which have actually been distributed to the Participant by
the other plan) will be permitted with respect to benefits attributable to
such a plan.
(c) Direct Rollover Option: Effective January 1, 1993,
distributions from this Plan may be directly rolled over to another plan
pursuant to the provisions of Subsection 6.4(g).
4.6 Disposition of Forfeitures: Upon termination of employment,
a Participant's Forfeiture, if any, shall be maintained in his Employer
Contribution Account until his Forfeiture Date, which is the earlier of (A)
the date on which he has received a distribution of the entire
non-forfeitable portion of his account (or deemed distribution in the case
of a Participant without any vesting, which deemed distribution date shall
be the date of his termination of employment with the Employer) or (B) the
last day of the Plan Year in which the Participant incurs five consecutive
one-year Breaks in Service, and shall continue to receive Income
allocations pursuant to Section 5.2(a) until such time. If the terminated
Participant returns to the employ of the Employer before his Forfeiture
Date, the undistributed amount in his Employer Contribution Account,
including any Forfeiture still maintained in his Employer Contribution
Account, plus Income allocations, shall upon reparticipation become the
beginning balance in his new Employer Contribution Account. If the
<PAGE>
terminated Participant does not return before his Forfeiture Date, any
vested amounts remaining in the terminated Participant's Accounts will be
distributed to him as hereinafter provided; and his Forfeiture, plus Income
allocations shall become available as of such Forfeiture Date for use as
provided in Section 5.2(e) as a current or subsequent Employer Contribution
of the Employer as of the Valuation Date next following such Forfeiture
Date. If a terminated Participant who is less than one hundred percent
vested in his Employer Contribution Account is reemployed after five
consecutive one-year Breaks in Service, but before distribution of his
vested account balance, any portion of his account that has not been
distributed will be segregated in the records of the Trust and separately
accounted for until such time as the Participant is one hundred percent
vested in his Employer Contribution Account.
4.7 Pay Back Provision: If a terminated Participant who is less
than one hundred percent vested in the Plan receives a distribution of his
entire nonforfeitable benefit derived from his Salary Deferral Account
and/or his Employer Contribution Account, and such Former Participant
returns to the employ of the Employer, then such reemployed Participant
shall be given an opportunity to repay the full amount of any such prior
distribution of amounts derived from Salary Deferral and Employer
Contributions as provided below. If such a reemployed Employee repays such
amounts from his Salary Deferral Account and Employer Contribution Account
before the earlier of five years after the first date on which he is
subsequently reemployed by the Employer or the close of the first period of
five consecutive one-year Breaks in Service commencing after distribution
(or, in the case of a distribution from the Plan other than by reason of
separation from Service, five Years after the date of the distribution),
then his prior account balance shall be restored to the amount which was
allocated to such accounts on the date of distribution, and each class year
of such previously forfeited balance shall be re-credited with the number
of Plan Years previously credited to it under the Plan's vesting schedule
and thereafter shall be credited with Plan Years following re-employment
until such amount is fully vested under the Plan's class vesting schedule.
If the Plan's class vesting schedule is ever replaced with a non-class
vesting schedule, then any restored amounts derived from a period from
which the Plan had this class vesting schedule shall be treated in
accordance with Section 1113(f) of the Tax Reform Act of 1986, as amended
by the Technical Corrections Act of 1988, so that the re-employed
Participant's non-forfeitable right to such restored benefits is determined
under the previous class-year vesting schedule if that schedule would yield
a larger non-forfeitable amount. In the case of a reemployed Former
Participant who had no vested interest in either his Salary Deferral
Account or Employer Contribution Account at the time of his previous
separation from Service and who therefore was deemed to have received a
distribution, if such Former Participant is reemployed before he has
incurred five consecutive one-year Breaks in Service, then repayment of his
Salary Deferral Account and Employer Contribution Account shall be deemed
to be made on his reemployment date.
If the Plan is required to restore forfeited amounts by
virtue of a pay back under this Section, such restoration shall be made no
later than the end of the Plan Year following the Plan Year of repayment,
and the Committee may choose among any or a combination of the following
permissible sources for restoration: Forfeitures which become available
<PAGE>
that Plan Year, or additional Employer contributions (which Employer
contributions shall be in addition to those required or permitted by
Section 4.1 of the Plan).
In the event a Participant exercises his right to buy back a
previous Forfeiture through a repayment of a prior distribution pursuant to
this Section, no part of the amount which is repaid to the Plan by the
Participant may be invested in any stock or other security of the Employer
or any affiliate of the Employer.
<PAGE>
ARTICLE 5. ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
5.1 Individual Accounts: The Committee shall create and
maintain adequate records to disclose the interest in the Trust of each
Participant, Former Participant and Beneficiary. Such records shall be in
the form of individual accounts and credits and charges shall be made to
such accounts in the manner herein described. When appropriate, a
Participant shall have a Salary Deferral Account, an Employer Contribution
Account, and a Rollover Account. Subaccounts also may be maintained
pursuant to rules and regulations of the Committee to reflect collective
investment subaccounts, segregated subaccounts and any other subaccounts
deemed necessary or desirable by the Committee. The maintenance of
individual accounts is only for accounting purposes, and a segregation of
the assets of the Trust Fund to each account shall not be required.
Distributions and withdrawals made from an account shall be charged to the
account as of the date paid.
5.2 Account Adjustments: The accounts of Participants, Former
Participants and Beneficiaries and the Suspense Account shall be adjusted
in accordance with the following:
(a) Income: As of each Valuation Date, the Income of
the Trust Fund since the last Valuation Date shall be allocated among the
Suspense Account and the accounts of Participants, Former Participants and
Beneficiaries who had unpaid balances in their accounts on the Valuation
Date in proportion to the balances in such accounts immediately following
the prior Valuation Date, but after first reducing each such account
balance by the amount of any distributions, withdrawals, directed
investments, and loans from the account since the prior Valuation Date, and
after increasing the balance in each Salary Deferral Account and Rollover
Account since the prior Valuation Date by a weighted proportion of any
Salary Deferral Contributions, and rollover contributions since the last
Valuation Date weighted in accordance with the Trustee's customary and
reasonable accounting procedures in accordance with non-discriminatory
procedures and rules adopted by the Committee. The interest paid by a
Participant since the prior Valuation Date in respect of a loan from his
accounts, as provided in Section 6.6 or in any loan procedures established
pursuant to Section 6.6, shall be segregated and credited to such accounts
under the rules for such accounts. At the Committee's discretion uniformly
applied, administrative expenses directly connected or associated with a
particular Participant's account may be charged to that account. The
Income since the prior Valuation Date attributable to any investment of any
collective investment subaccount which has been established in accordance
with Section 7.8 also shall be allocated to such account as of each
Valuation Date, or at such other times (including any distribution date),
as may be appropriate under the Trustee's normal procedures for such
accounts. All valuations shall be based on the fair market value of assets
in the Trust Fund on the Valuation Date. Notwithstanding the foregoing, in
the event that the Plan's assets are invested among collective investment
funds as provided in Section 7.8 of this Plan, the foregoing allocation of
Income shall be adjusted to reflect the segregation of each such collective
investment fund.
(b) Salary Deferral Contributions: A Participant's
Salary Deferral Contributions under Section 4.2 during the Plan Year, and
<PAGE>
other amounts contributed by the Employer to the Salary Deferral Accounts
of Participants pursuant to Section 4.3(a)(2)(i), shall be allocated to his
Salary Deferral Account when received by the Trustee (less amounts
withdrawn as cash under Section 4.3).
(c) Employer Contributions: As of each Valuation Date,
the Employer Contributions (if any) made with respect to that period in the
Plan Year shall be allocated among those Participants who were in the
employ of the Employer on that Valuation Date, or at such earlier times as
provided by Committee rules and regulations. Such allocations shall be
made in accordance with the following formula (subject to subsection (f)
below):
(1) Matching Contributions: Any Employer
Contribution shall be allocated in a manner specified by the Parent
Company's Board of Directors so as to provide a uniform stated percentage
match of each Participant's Salary Deferrals up to a uniform stated
percentage of each Participant's Compensation; provided, that no such
allocation shall exceed a 100% match of each Participant's Salary Deferral
Contributions which are equal to six percent of his Compensation.
(2) Notwithstanding the foregoing, the allocation
of the aforesaid Matching Contribution also may be modified by stipulation
of the Board of Directors so as to discriminate against Highly Compensated
Employees and their Family Members if such modification is deemed necessary
or desirable by the Committee in order to comply with one of the tests set
forth in Section 4.3.
(3) Nothing in the foregoing shall require the
Employer to make any amount of Employer Contribution.
(d) Suspension of Accrual Requirements: If, for any
Plan Year beginning after December 31, 1988, the Plan fails to satisfy the
Participation Test under Code Section 401(a)(26) or the Coverage Test under
Code Section 410(b) this Section 5.2(d) will apply. The Plan will satisfy
the Participation Test if, using any allowable testing method, the number
of Employees who benefit under the Plan is at least equal to the lesser of
fifty or forty percent of the total number of Includable Employees or the
Plan otherwise satisfies Code Section 401(a)(26). The Plan will satisfy
the Coverage Test if, using any allowable testing method, the number of
Non-Highly Compensated Employees who benefit under the Plan is at least
equal to seventy percent of the total number of Includable Non-Highly
Compensated Employees or if the Plan otherwise satisfies Code Section
410(b). "Includable" Employees are all Employees other than (1) those
Employees excluded from participating in the Plan for the entire Plan Year
by reason of the collective bargaining unit exclusion or the nonresident
alien exclusion or by reason of the age or Service participation
requirements of Sections 3.1; and (2) to the extent required by the
Commissioner's then applicable rules and regulations, any Employee who
separates from Service during the Plan Year and fails to complete at least
501 Hours of Service for the Plan Year.
<PAGE>
For purposes of the Participation Test and the Coverage
Test, an Employee is benefiting under the Plan on a particular date if he
is entitled to an allocation for the Plan Year under Section 5.2(c). Under
the Participation Test, when determining whether an Employee is entitled to
an allocation under Section 5.2(c), the Committee shall disregard any
allocation required solely by reason of the Top-Heavy minimum allocation
under Section 5.2(f), unless the Top-Heavy minimum allocation is the only
allocation made under the Plan for the Plan Year.
If this Section 5.2(d) applies for a Plan Year, the
Committee shall suspend the accrual requirements for the Non-Highly
Compensated Includable Employees who are Participants, beginning first with
the Non-Highly Compensated Includable Employee(s) employed with the
Employer on the last day of the Plan Year, then the Non-Highly Compensated
Includable Employee(s) who have the latest separation from Service during
the Plan Year, and continuing to suspend in descending order the accrual
requirements for each Non-Highly Compensated Includable Employee who
incurred an earlier separation from Service, from the latest to the
earliest separation from Service date, until the Plan satisfies both the
Participation Test and the Coverage Test for the Plan Year. If two or more
Non-Highly Compensated Includable Employees have a separation from Service
on the same day, the Committee shall suspend the accrual requirements for
all such Non-Highly Compensated Includable Employees, irrespective of
whether the Plan can satisfy the Participation Test and the Coverage Test
by accruing benefits for fewer than all such Non-Highly Compensated
Includable Employees. If the Plan suspends the accrual requirements for an
Non-Highly Compensated Includable Employee, that Employee shall share in
the allocation of Employer Contributions and Participant Forfeitures, if
any, without regard to the number of Hours of Service he has earned for the
Plan Year and without regard to whether he is employed by the Employer on
the last day of the Plan Year.
The suspension of accrual requirements for Employer Matching
Contributions applies separately to the Code Section 401(m) portion of the
Plan, and the Committee will treat an Employee as benefiting under that
portion of the Plan if he is an eligible Employee for purposes of the Code
Section 401(m) nondiscrimination test.
(e) Forfeitures: Forfeitures assessed against
Participants' accounts which have become available shall be used to reduce
current or future Employer Contributions to be made under subsection (c)
above.
(f) Minimum Contributions and Forfeitures for a
Top-Heavy Plan: For any Plan Year in which the Plan is a Top-Heavy Plan,
the allocation formula will be changed to the extent necessary so that each
Participant who is a Non-Key Employee and who has not separated from
Service on the Anniversary Date (regardless of whether he has completed at
least l,000 Hours of Service in that Plan Year) will receive a total
allocation to his Employer Contribution Account which is equal to the
lesser of the following percentages of his 415 Compensation for that Plan
Year: (i) three percent or (ii) the highest percentage provided under the
Plan during that Plan Year on behalf of a Key Employee (with the percentage
being determined for each Key Employee by using that part of his 415
Compensation which is not in excess of $150,000 (or $200,000 for Plan Years
<PAGE>
beginning before January 1, 1994) or other higher amount applicable under
Code Section 401(a)(17) and, effective for Plan Years beginning after
December 31, 1988, by taking into account all elective deferrals under Code
Section 401(k) and matching contributions for that Key Employee); provided,
that the minimum contribution may be less than three percent only if the
Plan is not used by a defined benefit plan (whether active or wasting) to
meet the participation tests of Code Sections 401(a)(4) or 410. Effective
for Plan Years beginning after December 31, 1988, amounts contributed at a
Participant's election under Code Section 401(k) and any matching
contributions allocated to Nonkey Employees which are necessary in order to
satisfy the requirements of Code Sections 401(k) and 401(m) may not be
offset against the aforesaid minimum contribution for a Participant, but
amounts contributed by the Employer as qualified non-elective contributions
under Code Section 401(m)(4)(C) and matching contributions not necessary to
satisfy Code Section 401(k) or (m) may be offset. In all cases, Employer
contributions and forfeitures allocated to a Participant from any other
tax-qualified defined contribution plan of the Employer and any Aggregated
Employer required or permitted to be aggregated as described in the
definition of Top-Heavy Plan in Section 2.1 which meet the top-heavy
minimum contribution shall be offset. In the case of a Participant covered
both by tax-qualified defined contribution plan(s) and tax-qualified
defined benefit plan(s) of the Employer and any Aggregated Employer
required or permitted to be aggregated as described in the definition of
Top-Heavy Plan in Section 2.1, each Participant shall receive an aggregate
minimum benefit and contribution at least equal (using a comparability
analysis) to the minimum defined benefit (as defined in the Employer's
defined benefit plan) in any Plan Year in which the Plan is a Top-Heavy
Plan.
(g) Rollover Contributions: A Participant's rollover
contributions for the Plan Year shall be allocated to his Rollover Account
when received by the Trustee.
5.3 Maximum Additions:
(a) 415 Limitation: Notwithstanding anything contained
herein to the contrary, the total Additions made to the Employer
Contribution Account and Salary Deferral Account (or comparable accounts)
of a Participant in the Plan and all other defined contribution plans
(whether or not terminated) of the Employer and any Aggregated Employer for
any Limitation Year shall not exceed the "415 Limitation" which is the
lesser of (i) $30,000 (or, if greater, one-fourth of the dollar limitation
in effect under Code Section 415(b)(1)(A) for that Plan Year) or (ii)
twenty-five percent of the Participant's 415 Compensation for such
Limitation Year. If a short Limitation Year is created because of an
amendment changing the Limitation Year to a different consecutive twelve
month period, the (a)(i) amount will be multiplied by a fraction whose
numerator is the number of months in the short Limitation Year and whose
denominator is twelve; and the (a)(ii) amount will be based upon the
Participant's 415 Compensation for the short Limitation Year.
(b) Suspense Account: If as a result of the allocation
of Forfeitures or a reasonable error in estimating a Participant's annual
Compensation, or in determining the amount of elective deferrals within the
meaning of Code Section 402(g) that may be made within the limits of Code
Section 415 (or under other limited facts and circumstances which the
<PAGE>
Commissioner finds justify the availability of the rules set forth in this
Plan pursuant to Commissioner's Regulation Section l.415-6), the Annual
Additions for a Participant would exceed the 415 Limitation, then amounts
in excess of the 415 Limitation shall be treated in accordance with this
subparagraph. Any excess amounts in a Participant's account shall be used
to reduce Employer Contributions for the next Limitation Year (and
succeeding years, as necessary) for that Participant if that Participant is
covered by the Plan as of the end of the Limitation Year. If that
Participant is not covered by the Plan as of the end of the Limitation
Year, then the excess amounts shall be transferred to and held unallocated
in a Suspense Account for the Limitation Year and allocated and reallocated
as necessary to prevent the relevant 415 Limitations from being exceeded in
the next Limitation Year (and succeeding Limitation Years as necessary) to
all the remaining Participants in the Plan. Furthermore, the excess
amounts in the Suspense Account must be used to reduce Employer
Contributions for the next Limitation Year (and succeeding Limitation Years
as necessary) for all Participants in the Plan. In no event may any excess
amounts which are due to Employer Contributions be distributed out to
Participants or Former Participants.
(c) Aggregate Limitations:
(1) If an Employee is a Participant in one or
more defined benefit plans and one or more defined contribution plans ever
maintained by the Employer and any Aggregated Employer, the sum of his
defined benefit plan fraction and his defined contribution plan fraction
shall not exceed 1.0 in any Limitation Year.
(2) The term defined benefit plan fraction in any
Limitation Year shall mean a fraction the numerator of which is the sum of
the projected annual benefits (as defined below) payable to the Participant
as of the last day of the current Limitation Year under all defined benefit
plans of the Employer and any Aggregated Employer, and the denominator of
which is the lesser of: (A) the product of 1.25 (or 1.0 in the case of a
Top-Heavy Plan which does not meet the additional benefit requirements of
subsection (v) below or in the case of any Super Top-Heavy Plan) multiplied
by the dollar limitation in effect under Code Section 415(b)(1)(A) for that
year, or such greater or lesser amount as may be required to actuarially
adjust such limitation so it is equivalent to a benefit beginning at the
Social Security Retirement Age, as defined below), or (B) the product of
1.4 multiplied by the amount which is equal to one hundred percent of the
Participant's average 415 Compensation for the three highest consecutive
Years of Service (or actual number of years of employment if less than
three Years of Service).
For purposes of this subsection, a Participant's
"Projected Annual Benefit" is equal to the annual benefit (i.e., the bene-
fit payable annually in the form of an equivalent straight life annuity
beginning at the Social Security Retirement Age, but excluding benefits
attributable to Employee After-Tax Contributions or rollover contributions,
if any) to which the Participant in a defined benefit plan would be entitled
under the terms of the plan assuming that the Participant will continue
employment until reaching the later of the plan's normal retirement age or
his current age, that the Participant's 415 Compensation for the Limitation
Year under consideration will remain the same until the date the Participant
attains the later of the plan's normal retirement age or his current
<PAGE>
age, and that all other relevant factors used to determine benefits under
the plan for the Limitation Year under consideration will remain constant
for all future years.
Actuarial adjustments for form of benefit or for
benefits beginning before the Social Security Retirement Age shall use an
interest rate assumption which is not less than the greater of five percent
or the rate specified by the plan, and otherwise shall be made in the
manner prescribed by the Commissioner to be consistent with the reduction
for old-age insurance benefits beginning prior to the Social Security
Retirement Age. Actuarial adjustments for benefits beginning after the
Social Security Retirement Age shall use an interest rate which is not
greater than the lesser of five percent or the rate specified by the plan.
None of the aforesaid actuarial adjustments shall be taken into account
before the year for which such adjustments take effect. For purposes of
this subsection, "Social Security Retirement Age" shall mean the retirement
age under Section 216(1) of the Social Security Act, except that such
Section 216(1) shall be applied without regard to the age increase factor
and as if the early retirement age under Section 216(1)(2) were age 62.
(3) The term defined contribution plan fraction
in any Limitation Year shall mean a fraction the numerator of which is the
sum of the Annual Additions made to the Participant's account(s) as of the
last day of the current Limitation Year and for all prior Limitation Years
under all defined contribution plans of the Employer and any Aggregated
Employer (less any amount which may be subtracted therefrom by virtue of
the Commissioner's regulations adopted under the Tax Equity and Fiscal
Responsibility Act of 1982), and the denominator of which is the sum of the
lesser of the following amounts determined for each year and for each prior
Year of Service: (A) the product of 1.25 (or 1.0 in the case of a Top-
Heavy Plan which does not meet the additional minimum benefit requirements
of subsection (v) below or any Super Top-Heavy Plan) multiplied by the
dollar limitation in effect under Code Section 415(c)(1)(A) for such year
determined without regard to Code Section 415(c)(6), or (B) 1.4 multiplied
by the amount which is equal to twenty-five percent of the Participant's
415 Compensation for such Limitation Year; provided, at the election of the
Committee, in any year beginning after December 31, 1982 where the plan was
in existence on or before July 1, 1982, the denominator of the defined
contribution fraction with respect to a Participant for all years ending
before January 1, 1983, shall be an amount equal to the product of the
amount determined to be the denominator under the foregoing sentence
multiplied by a fraction the numerator of which is the lesser of $51,875 or
1.4 multiplied by twenty-five percent of the Participant's 415 Compensation
for the year ending in 1981, and the denominator of which is the lesser of
$41,500 or twenty-five percent of the Participant's 415 Compensation for
the year ending 1981.
(4) Annual Additions in the numerator of the
defined contribution plan fraction shall not exceed the aggregate maximum
Annual Additions in the denominator of the defined contribution plan
fraction in any Limitation Year beginning prior to January 1, 1976.
(5) In computing the defined benefit plan
fraction and the defined contribution plan fraction in subsections (ii) and
(iii) above, the number 1.0 shall not be substituted for 1.25 in computing
the denominator in the case of a Top-Heavy Plan (other than a Super
<PAGE>
Top-Heavy Plan) if each Nonkey Employee who is a Participant receives a
certain minimum benefit or contribution under a plan of the Employer or
Aggregated Employer. The minimum benefit for these purposes in the case of
a defined benefit plan shall be the product of the Participant's high
consecutive five year 415 Compensation (not including 415 Compensation in
Plan Years beginning before January 1, 1984, or 415 Compensation for Plan
Years beginning after the close of the last Plan Year in which the Plan was
not a Top-Heavy Plan) times the lesser of (A) three percent per Top-Heavy
Year of Service, or (B) the sum of twenty percent plus one percent per each
of the first ten Top-Heavy Years of Service. The minimum contribution for
these purposes in the case of a defined contribution plan shall be a total
allocation of Employer contribution and forfeitures of four percent of the
415 Compensation for each Participant who is a Nonkey Employee (but this
four percent figure shall be reduced to the extent necessary in any Plan
Year so that it is no more than the largest percentage provided for any Key
Employee during that Plan Year, with the Key Employees' percentages being
determined by using only that part of their 415 Compensation that is not in
excess of $150,000, or $200,000 for Plan Years beginning prior to January
1, 1994). In the case of a Nonkey Employee covered both by defined
contribution plan(s) and defined benefit plan(s) of the Employer and any
Aggregated Employer, the Nonkey Employee must receive an aggregate benefit
and contribution at least equal to the minimum defined benefit described
above.
(6) Notwithstanding the foregoing, in the case of
any individual who is a participant as of the first day of the first plan
year beginning after December 31, 1986 in a defined benefit plan which was
in existence on May 6, 1986, and with respect to which the requirements of
Code Section 415 have been met for all plan years, if such individual's
current accrued benefit under the plan exceeds the limitation of Code
Section 415(b) as amended by the Tax Reform Act of 1986, then for purposes
of Code Section 415(b) and (e), the limitation of Code Section 415(b)(1)(A)
with respect to such individual shall be equal to such individual's accrued
benefit at the close of the last plan year beginning prior to January 1,
1987 when expressed as an annual benefit within the meaning of Code Section
415(b)(2) (but without taking into account any changes in the terms or
conditions of the plan after May 5, 1986 or any cost-of-living adjustment
occurring after May 5, 1986). Furthermore, in the case of a plan which
satisfied the requirements of Code Section 415 for its last plan year
beginning prior to January 1, 1987, in accordance with regulations that may
be promulgated by the Commissioner, an amount may be subtracted from the
numerator of the defined contribution plan fraction (not exceeding such
numerator) so that the sum of the defined benefit plan fraction and defined
contribution plan fraction computed under Code Section 415(e)(1) does not
exceed 1.0 for such year.
(d) 415 Compensation: For purposes of applying the 415
Limitations under this Section 5.3, the term "415 Compensation" means
compensation as defined by Code Section 415(c)(3), and includes:
(1) The Employee's wages, salaries, fees for
professional services and other amounts received (without regard to whether
or not an amount is paid in cash) for personal services actually rendered
in the course of employment with the Employer maintaining the Plan to the
extent that the amounts are includible in gross income (including, but not
limited to, commissions paid salesmen, compensation for services on the
<PAGE>
basis of a percentage of profits, commissions on insurance premiums, tips,
bonuses, fringe benefits and reimbursements or other expense allowances
under a nonaccountable plan (as described in Code Section 1.62-2(c));
(2) In the case of a self-employed individual,
earned income as defined in Code Section 401(c)(2) for any taxable year;
(3) Amounts received through Employer-provided
accident or health insurance for personal injuries or sickness, but only to
the extent that these amounts are includable in the gross income of the
Employee for federal income tax purposes;
(4) Amounts paid or reimbursed by the Employer
for moving expenses incurred by an Employee, but only to the extent that at
the time of the payment it is reasonable to believe that these amounts are
not deductible by the Employee for federal income tax purposes;
(5) The value of a nonqualified stock option
granted to an Employee by the Employer, but only to the extent that the
value of the option is includable in the gross income of the Employee for
the taxable year in which granted;
(6) Other Employer-paid amounts includable in the
gross income of an Employee for federal income tax purposes, including,
without limitation, amounts includible by virtue of an election under Code
Section 83(b); and
(7) With respect to amounts described in (1) and
(2) above, foreign earned income as described in Code Sections 911(b), 931
and 933, regardless of whether otherwise excludible under Code Sections
911, 931, and 933.
(e) Not 415 Compensation: Notwithstanding the above,
the term "4l5 Compensation" does not include items such as:
(1) Contributions made by the Employer to a plan
of deferred compensation to the extent that, before the application of the
415 Limitations to that plan, the contributions are not includable in the
Employee's gross income for federal income tax purposes for the taxable
year in which contributed. In addition, Employer contributions made on
behalf of an Employee to a simplified employee pension are not considered
as compensation for the taxable year in which contributed to the extent
such contributions are deductible by the Employee for federal income tax
purposes. Additionally, any distributions from a plan of deferred
compensation are not considered as compensation under this subsection,
regardless of whether such amounts are includable in the gross income of
the Employee when distributed; however, any amounts received by an Employee
pursuant to an unfunded non-qualified plan of the Employer may be
considered as compensation under this subsection in the year such amounts
are includable in the gross income of the Employee for federal income tax
purposes;
<PAGE>
(2) Amounts realized from the exercise of an
Employer nonqualified stock option, or when restricted Employer stock (or
property) held by an Employee either becomes freely transferable or is no
longer subject to a substantial risk of forfeiture;
(3) Amounts realized from the sale, exchange or
other disposition of Employer stock acquired under a qualified stock option;
(4) Other Employer-paid amounts which receive
special federal income tax benefits, such as premiums for group term life
insurance (but only to the extent that the premiums are not includable in
the gross income of the Employee), or contributions made by an Employer
(whether or not under a salary reduction agreement) towards the purchase of
an annuity contract (whether or not the contributions are excludable from
the gross income of the Employee).
<PAGE>
ARTICLE 6. BENEFITS
6.1 Retirement or Disability: If a Participant has attained
Normal Retirement Age or if his employment is terminated at an earlier age
because of Disability, he shall be fully vested in the amount allocated to
each of his accounts and shall be entitled to receive such amount following
the termination of his employment payable in accordance with Section 6.4.
6.2 Death and Designation of Beneficiary:
(a) Death Benefits: In the event that the termination
of employment of a Participant is caused by his death, the entire amount
then allocated to each of his accounts shall be fully vested and shall be
payable to his Beneficiary after receipt by the Committee of an acceptable
proof of death in accordance with this Section. In the event that the
Participant's death occurs after his termination of employment but before
he has received all of his Plan benefits, the entire amount then allocated
to each of his accounts shall not be fully vested but the vested amount
then allocated to each of his accounts as provided in Section 6.3 shall be
payable to his Beneficiary after receipt by the Committee of an acceptable
proof of death in accordance with this Section.
(b) Designation of Beneficiary: Each Participant from
time to time may designate any person or persons (who may be designated
contingently or successively and who may be an entity other than a natural
person) as his Beneficiary or Beneficiaries to whom his Plan benefits are
paid if he dies before receipt of all such benefits; provided, that a
Participant's or Former Participant's Beneficiary in all cases shall be his
Surviving Spouse as defined in Section 2.1, unless either (i) the present
value of the Participant's nonforfeitable account balance is not more than
$3,500 as of the Payment Starting Date, or (ii) there is no such Surviving
Spouse at the time of death or (iii) the Surviving Spouse consents to the
appointment of another Beneficiary pursuant to a waiver of spousal rights
as provided in Subsection (c) below. Each Beneficiary designation shall be
in a form prescribed by the Committee and will be effective only when filed
with the Committee during the Participant's lifetime, and shall be subject
to and conditioned upon any and all provisions of federal law (including,
but not limited to, the Retirement Equity Act of 1984) regarding the choice
of Beneficiary. Each Beneficiary designation filed with the Committee will
cancel all Beneficiary designations previously filed with the Committee.
If any Participant fails to designate a Beneficiary in the manner provided
above, or if the designated Beneficiary dies before the deceased
Participant or before complete distribution of the Participant's benefits,
then, and in any such event, the person(s) who shall constitute the
Beneficiary shall be:
(1) The then surviving spouse of the deceased
Participant; or
(2) In the event that there is no such surviving
spouse, but the Participant is then survived by a child, children, or issue
of a deceased child or children, then the Beneficiary shall be such then
surviving children and surviving issue of such deceased children, to share
on a per stirpes basis; or
<PAGE>
(3) In the event that there is no such surviving
spouse or surviving children or their issue, then the Beneficiary shall be
the estate of the deceased Participant.
(c) Requirements of Surviving Spouse Consent to
Alternative Beneficiary: A Participant's or Former Participant's Surviving
Spouse or spouse may consent to the designation of another Beneficiary if
such consent is in a writing which is signed by the Participant's or Former
Participant's Surviving Spouse or spouse, acknowledges the effect of the
consent, and is witnessed by a Plan representative or notary public. The
spouse's consent must acknowledge the specific non-spouse Beneficiary, and
such Beneficiary may not subsequently be changed to another non-spouse
Beneficiary unless the spouse's consent again is obtained in the form
prescribed above, or unless the spouse's prior consent expressly permitted
new designations by the Participant without the requirement of further
consent by the spouse. Any consent necessary under this Section will be
valid only with respect to the spouse who signs the consent, but shall be
irrevocable by that spouse as to the specified non-spouse Beneficiary.
However, a Participant or Former Participant may revoke a spouse's waiver
(and thereby cause the spouse to become a Beneficiary) at any time before
the commencement of benefits by filing a new Beneficiary designation form,
even without the consent of the spouse or Surviving Spouse, and the number
of such revocations by a Participant or Former Participant shall not be
limited. Notwithstanding the foregoing written consent requirement, if the
Participant establishes to the satisfaction of a Plan representative that
such written consent may not be obtained because there is no spouse or the
spouse cannot be located, or if a Participant has a court order that he
either is legally separated or has been abandoned within the meaning of
local law, then a valid spousal consent will be deemed to have been made.
6.3 Termination for Other Reasons: If a Participant's
employment with the Employer is terminated before Normal Retirement Age for
any reason other than Disability or death, the Participant (or his
Beneficiary under Section 6.2 in the event of the Participant's death prior
to his receipt of all his Plan benefits) shall be entitled to the sum of
the amounts determined under (a) and (b) below payable as provided in
Section 6.4:
(a) Salary Deferral Account and Other Employee
Accounts: The entire amount credited to his Salary Deferral Account and
his Rollover Account, plus
(b) Vested Employer Contribution Account: An amount
equal to the vested percentage of his Employer Contribution Account
balance. Such vested percentage shall be determined in accordance with the
following:
(1) Prior to January 1, 1989:
(i) Class Year Vesting: The vested
rights of a Participant in his Employer Contribution Account shall be
determined separately for Employer Contributions made on account of each
Plan Year. A Participant will have no vesting in Employer Contributions
for any Plan Year until the end of the second complete Plan Year following
the Plan Year for which such Employer Contributions were made. A
Participant will be 100% vested in Employer Contributions for any Plan
<PAGE>
Year if he is employed by the Employer on the last day of the second Plan
Year following the Plan Year for which those Employer Contributions
were made and he has not separated from service during that time. A
Participant's Employer Contributions for any Plan Year shall be forfeited
in accordance with Section 4.5 if he separates from Service before the end
of the second Plan Year following the Plan Year for which the Employer
Contributions were made.
(ii) Special Rule for Participants with
Ten Years of Service: Notwithstanding the above, any Participant who has
completed ten or more years of Service shall be 100% vested in all Employer
Contributions to his account.
(2) After December 31, 1988: For Participant's
having at least one hour of service with the Employer for Plan Years
beginning after December 31, 1988, such vested percentage shall be
determined in accordance with the following "non-Top-Heavy" schedule:
<TABLE>
<CAPTION>
VESTED FORFEITED
YEARS OF SERVICE PERCENTAGE PERCENTAGE
<S> <C> <C>
Less than 5 0% 100%
5 or more 100% 0%
</TABLE>
(3) Top-Heavy Rules: Notwithstanding the above, if the
Plan becomes a Top-Heavy Plan, the vested percentage of all amounts then
existing in the Employer Contribution Account of any Participant who
completes at least one Hour of Service after the Plan becomes a Top-Heavy
Plan (including amounts attributable to Employer Contributions allocated
before the Plan became a Top-Heavy Plan) shall be determined in accordance
with the following "Top-Heavy" schedule (unless another vesting schedule is
permitted by Code Section 416 which fully vests in a less rapid manner, in
which event such other permissible vesting schedule hereby is instead
incorporated by reference):
<TABLE>
<CAPTION>
VESTED FORFEITED
YEARS OF SERVICE PERCENTAGE PERCENTAGE
<S> <C> <C>
Less than 2 0% 100%
2 but less than 3 20% 80%
3 but less than 4 40% 60%
4 but less than 5 60% 40%
5 or more 100% 0%
</TABLE>
If the Plan ceases to be a Top-Heavy Plan, the Plan's vesting schedule
automatically will be changed to the non-Top-Heavy vesting schedule.
<PAGE>
Notwithstanding any amendment (or automatic change by virtue of the
Plan becoming or ceasing to be a Top-Heavy Plan) of the Plan's vesting
schedule, the vested percentage of the amounts allocated to the Employer
Contribution Account of a Participant who had been covered under the prior
provisions of the Plan (such amounts being determined as of the later of
(i) the date the amendment or change is adopted or (ii) the date it becomes
effective), shall not be less than the vested percentage of such previously
allocated amounts which the Participant would have had, had the provisions
of the Plan as in effect immediately prior to the effective date continued
without change. In addition, in the event the vesting provisions of the
Plan are amended (or are changed automatically by virtue of the Plan
becoming or ceasing to be a Top-Heavy Plan), each Participant in the Plan
who has had three (or five in the case of a Participant who does not have
at least one Hour of Service with the Employer for Plan Years beginning
after December 31, 1988) or more Years of Service shall be permitted to
make an election as provided under Section 11.2 of this Plan.
The percentage of the Participant's Employer Contribution Account
which is not vested shall be a Forfeiture subject to the provisions of
Section 4.5. Payment of benefits due under this Section 6.3 shall be made
in accordance with Section 6.4.
6.4 Payment of Benefits:
(a) Participant's Claim for Benefits: Upon a
Participant's entitlement to payment of benefits under Section 6.1 or 6.3,
or a Beneficiary's entitlement to payment under Section 6.2, he shall file
with the Committee his written request as to time and manner of payment on
such form or forms, and subject to such conditions, as the Committee shall
provide.
(b) Committee's Determination: Subject to the
provisions of subsections (c) through (g) below, and also subject to the
spousal consent requirements of Section 6.2, the Committee shall determine
when payment of a Participant's benefits is to commence and the method by
which his benefits will be paid, and shall direct the Trustee accordingly.
The Committee shall act in accordance with this Plan in making any
determinations under this section and shall not be bound by a Participant's
request under this section.
(c) When Benefit Payments Commence:
(1) Payment of a Participant's benefits must
commence no later than the Payment Starting Date (as defined in Section 2.1
of the Plan), unless the Participant elects later payment (subject to the
provisions of subsection (e) below) or is deemed to have elected to defer
payment of benefits by failing to give consent to a distribution in excess
of $3,500 as provided in the Commissioner's Regulation Section
1.411(a)-11(c)(7).
(2) Unless the Participant has elected payment as
soon as possible under Section 6.4(c)(3) below, a distribution will be
deferred until Normal Retirement Age, or his death; provided, that if the
total of his vested benefits in all accounts derived from Employer
Contributions, Salary Deferral Contributions and any other Employee
contributions does not exceed $3,500 or such other greater cash-out amount
<PAGE>
as may be provided under the Commissioner's rulings and regulations, the
Committee shall require a mandatory cash-out and provide for distribution
of vested benefits in a lump sum as of the earliest date permitted under
Section 6.4(c)(3) below. For purposes of this mandatory cash-out
provision, if the value of a Participant's vested account balance is zero,
the Participant shall be deemed to have received a distribution of such
vested account balance on the date of his termination of employment.
Within a period of no less than thirty days and no
more than ninety days prior to a distribution, the Committee shall provide
the Participant written notice of his rights to consent to a distribution
and the Participant must consent in writing to the distribution in
accordance with Treasury Regulation Section 1.411(a)-11(c); provided that,
subject to the rules relating to the timing of distributions in Section
6.4(c)(3) below, such distribution may commence less than thirty days after
such notice is given, provided that (i) the Committee clearly informs the
Participant that the Participant has a right to a period of at least thirty
days after receiving the notice to consider the decision of whether or not
to elect a distribution (and, if applicable, a particular distribution
option), and (ii) the Participant, after receiving the notice,
affirmatively elects a distribution.
(3) Distributions to a Participant, Beneficiary
or Alternate Payee who has consented to payment to the extent required
under Subsection (2) above shall be made as soon as administratively
practicable following the Valuation Date following the date on which the
Participant, Beneficiary or Alternate Payee has become entitled to payment
under the foregoing, subject to the following exceptions:
(i) Distributions to the extent required
by Code Section 401(a)(9) may be made at other times as required by law;
(ii) Notwithstanding the foregoing, in any
event where the Trustee has determined that the value of the Trust has
declined since the last Valuation Date in a manner which would cause the
distribution of Plan assets based on the prior Valuation Date to injure
other Plan Participants, then distributions under this Plan will be delayed
(except to the extent required in Code Section 401(a)(9) and the
regulations thereunder) until the next Valuation Date as of which a
distribution would not cause harm to other Plan Participants; and
(iii) Notwithstanding the foregoing, in all
events, the commencement of benefit payments shall be subject to Subsection
(e) below.
(d) Method of Payment: Subject to Subsection (e) below
and to the spousal consent requirements of Section 6.2 and also subject to
any Beneficiary's right to waive his right to receive Plan benefits, the
Committee shall direct the Trustee to distribute the Participant's benefits
in a lump sum.
(e) When Distribution Must be Completed and Minimum
Amount of Periodic Payments:
<PAGE>
(1) Before Death of Participant: Anything to the
contrary in this Plan notwithstanding, the entire interest of a Participant
or Former Participant in the Plan either (i) must be distributed to him not
later than April 1 of the calendar year following the calendar year in
which he attains age seventy and one-half (or, in the case of a Participant
or Former Participant other than a Five Percent Owner who reached age
seventy and one-half before January 1, 1988, not later than April 1 of the
calendar year following the later of such year or the calendar year he
retires); or (ii) in the case of a Participant who is still employed at age
seventy and one-half, will be distributed, commencing not later than the
date specified in subsection (i) above, over the life of such Participant
or Former Participant, or over a specified period not in excess of his life
expectancy. In any case where the Participant's entire interest is
distributed other than in a lump sum, the amount to be distributed each
year must be at least an amount equal to the quotient obtained by dividing
the Participant's entire interest by the life expectancy of the
Participant. Life expectancy for purposes of this paragraph shall be
computed by the use of the return multiples contained in Section 1.72-9 of
the Commissioner's Regulations. For purposes of this computation, the life
expectancy (other than in the case of a life annuity) may be recalculated
no more frequently than annually.
(2) After Death of Participant (or Surviving
Spouse): If a Participant or Former Participant dies after distribution of
his or her interest has commenced, the remaining portion of his interest
will be distributed at least as rapidly as under the method of distribution
being used prior to the Participant's or Former Participant's death. If a
Participant or Former Participant dies before distribution of his interest
in that Plan has commenced, then any remaining interest of the Participant
or Former Participant must be distributed in a lump sum within five years
after his death.
(3) Commissioner's Regulations: This subsection
(e) shall be construed in accordance with the Commissioner's Regulations
promulgated under Code Section 401(a)(9).
(f) Form of Payment: The amount which a Participant,
Former Participant, or Beneficiary is entitled to receive at any time and
from time to time may be paid in cash or in securities, or in any
combination thereof, provided no discrimination in value results therefrom.
(g) Direct Rollover Option: This Subsection applies to
distributions made on or after January 1, 1993. Notwithstanding any
provision of the Plan to the contrary that would otherwise limit a
Distributee's election under this Subsection, a Distributee who otherwise
has become entitled to a distribution under the Plan may elect, at the time
and in the manner prescribed by the Committee to have any portion of that
distribution which is an Eligible Rollover Distribution paid directly to an
Eligible Retirement Plan specified by the Distributee in a Direct
Rollover. The Committee may establish rules whereby rollovers are not
permitted in cases where the anticipated annual distribution is less than
$200, in cases where the Participant wishes to have a portion of the
distribution paid to him but the entire distribution is $500 or less, where
the Participant seeks a rollover to more than one Eligible Retirement Plan,
and in other limited circumstances permitted by the Commissioner.
<PAGE>
6.5 Hardship and Other In-Service Withdrawals by Participants:
(a) Withdrawals: Upon a written application to the
Committee, in the event of Hardship (as defined below), a Participant may
withdraw from his Employer Contribution Account, his Rollover Account, and
his Salary Deferral Account, an amount up to (1) the value of the vested
portion of his Employer Contribution Account as of the Valuation Date
preceding the date of withdrawal; plus (2) the value of his Rollover
Account as of the Valuation Date preceding the date of withdrawal; plus (3)
the value of his Salary Deferral Account (subject to the limitations in
this Section) as of the Valuation Date preceding the date of withdrawal up
to the amount authorized by virtue of Hardship. The amount of withdrawn
funds from the Employer Contribution Account, Rollover Account, and Salary
Deferral Account cannot be less than $500.00 nor in an amount in excess of
the amount required by the Hardship and not reasonably available from other
resources of the Participant.
No withdrawals may be made from the vested portion of a
Participant's Employer Contribution Account until the full amount
permissible has been withdrawn from his Rollover Account, and no
withdrawals may be made from a Participant's Salary Deferral Account until
the full amount permissible has been withdrawn from his Employer
Contribution Account.
(b) Definition of Hardship: The determination of
Hardship shall be made by the Committee using uniform, non-discriminatory
and objective standards and shall be limited to genuine financial
emergencies when the Participant has an immediate and heavy financial need
of the funds and the funds are not reasonably available from other
resources of the Participant. The amount of an immediate and heavy
financial need may include any amounts necessary to pay federal, state or
local income taxes or penalties reasonably anticipated to result from the
distribution. Hardships justifying withdrawal shall be limited solely to
(1) the costs directly related to the purchase of a primary home for the
Participant (not including mortgage payments); (2) the need to prevent the
eviction of a Participant from his principal residence or foreclosure on
the mortgage of the Participant's principal residence; (3) paying tuition
and related educational fees for the next twelve months of post-secondary
education of the Employee, his spouse, children or dependents; (4)
providing income for medical expenses described in Code Section 213(d)
incurred by the Participant, his spouse or any of his dependents (as
defined in Code Section 152) or necessary for these persons to obtain such
medical care; or (5) other hardships deemed immediate and heavy finanical
needs under the Commissioners regulations; provided, that the
interpretation of Hardship shall in all cases be consistent with final
regulations issued under Code Section 401(k).
6.6 Loans to Participants: Loans shall be available to
Participants and Beneficiaries on a reasonably equivalent basis and in
accordance with written procedures and rules adopted by the Committee which
shall be considered a part of this Plan. Any amendments to such written
procedures and rules also shall be in writing, shall be adopted by the
Committee, and shall be considered a part of this Plan.
<PAGE>
6.7 Distributions Pursuant to Qualified Domestic Relations
Orders:
(a) Payments to an Alternate Payee Under a Qualified
Domestic Relations Order: The Committee shall pay benefits to the
Alternate Payee(s) in accordance with the terms of this Section, any
government regulations adopted under ERISA Section 206, and the applicable
provisions of any Qualified Domestic Relations Order entered by a court of
competent jurisdiction on or after January 1, 1985. In the case of a
Domestic Relations Order entered by a court of competent jurisdiction
before January 1, 1985, the Committee (1) shall treat such order as a
Qualified Domestic Relations Order under this Section if the Committee is
paying benefits pursuant to such order on January 1, 1985 and (2) may, in
its discretion, treat any other such order as a Qualified Domestic
Relations Order under this Section even if such order does not meet the
requirements therefor.
(b) Plan Procedures Relative to Qualified Domestic
Relations Orders:
(1) Notification: Following its receipt of any
Domestic Relations Order, the Committee shall promptly notify in writing
the affected Participant or Former Participants and Alternate Payee(s) of
its receipt of the order, and shall furnish such persons a copy of the order
and of these Plan procedures (and any other procedures which may have been
adopted by the Committee) for determining whether the order is a Qualified
Domestic Relations Order. This notice and all other notices pursuant to
this Section will be sent to the address included in the Domestic Relations
Order (or to such other address as is known to the Committee or as may
thereafter be specified in writing by the addressee). Any Alternate Payee
shall be permitted to designate a representative for receipt of copies of
notices that are to be sent to the Alternate Payee. Such notice shall set a
time and date no less than fifteen days nor more than thirty days from the
date the notice is mailed on which the Committee will meet to determine
whether the order is a Qualified Domestic Relations Order, and shall inform
the Participant or Alternate Payee that he may present written or oral
comments at that time with regard to such determination.
(2) Determination of Committee: On the date
specified in the above notice, the Committee shall examine the Domestic
Relations Order in light of any comments received and in light of
applicable law and regulations, and shall make one of three
determinations: (i) that the order is a Qualified Domestic Relations
Order; (ii) that the order is not a Qualified Domestic Relations Order; or
(iii) that the determination of whether the order is a Qualified Domestic
Relations Order should be submitted to and made by a court of competent
jurisdiction. If, within eighteen months from the date on which the first
payment of benefits would be required to be made under such order, it is
determined by the Committee or court of competent jurisdiction that the
order (or modification thereof) is a Qualified Domestic Relations Order,
the Committee shall pay any separately accounted for amounts (plus
adjustments required by the order) to the specified Alternate Payee, and
thereafter shall pay the Alternate Payee the amount specified by the
Qualified Domestic Relations Order. If, within the aforesaid eighteen
month period, it is determined by the Committee or a court of competent
jurisdiction that the order is not a Qualified Domestic Relations Order, or
<PAGE>
the question of whether the order is a Qualified Domestic Relations Order
is not determined by the Committee or a court of competent jurisdiction,
then the Committee shall pay any amounts (plus any Income or allocated
interest or earnings thereon) separately accounted for below to the
Participant, Former Participant or other person or persons who would have
been entitled thereto if there had been no Domestic Relations Order. Any
determination other than that an order is a Qualified Domestic Relations
Order after the close of the aforesaid eighteen month period shall be
applied prospectively only.
(3) Separate Accounting of Participant's and
Alternate Payee's Benefits: During any period in which the Participant
otherwise would have had a right to payment of Plan benefits and in which
the issue of whether an order is a Qualified Domestic Relations Order is
being determined, the Committee shall separately account for (but need not
physically escrow) the amounts as to which the Participant or Former
Participant otherwise would have had a right to payment during such period
and which amounts would have been payable to the Alternate Payee during
such period if the order had been determined to be a Qualified Domestic
Relations Order. Amounts determined to be payable to an Alternate Payee in
accordance with a Qualified Domestic Relations Order (or otherwise
separately accounted for by this subsection) shall not be considered to be
part of the Participant's account with respect to any other spouse or
beneficiary of the Participant.
(4) Expenses of Domestic Relations Order: All
unreasonable or unusual fees and expenses incurred by the Plan, the
Committee and/or the Trustee in evaluating and effecting a Domestic
Relations Order shall be charged to the Employer Contribution Account,
Rollover Account, or Elective Deferral Account of the Participant with
respect to whom the Domestic Relations Order was received; provided, that
if a separate account is established for an Alternate Payee pursuant to a
Qualified Domestic Relations Order, such unreasonable and unusual fees and
expenses shall be charged equally to the Participant's Plan accounts and
the Alternate Payee's Plan accounts. Such fees and expenses may include,
but not be limited to, attorneys' fees, accountants' fees, court costs,
mailing expenses, and other expenses attributable to the Domestic Relations
Order.
(c) Notification of Pending Order: In the event the
Committee is notified in writing by the attorney representing a potential
Alternate Payee that the attorney has commenced legal action in a court of
competent jurisdiction and has requested a Qualified Domestic Relations
Order or will request an Order in connection with such legal action, the
Committee may delay any distribution from the Plan for which the
Participant is eligible until such time as the court makes a disposition
with respect to the Order or the pending action or such earlier time as the
Participant and potential Alternate Payee otherwise agree in writing.
(d) Definitions:
(1) Alternate Payee: Any spouse, former spouse,
child or other dependent of a Participant or Former Participant who is
recognized by a Domestic Relations Order as having a right to receive all,
or a portion of, the benefits payable under the Plan with respect to such
Participant or Former Participant.
<PAGE>
(2) Domestic Relations Order: Any judgment,
decree or order (including approval of a property settlement agreement)
which relates to the provision of child support, alimony payments, or
marital property rights to a spouse, former spouse, child or other
dependent of a Participant, and is made pursuant to a State's domestic
relations law or community property law.
(3) Qualified Domestic Relations Order: A
Domestic Relations Order which:
(i) Creates or recognizes the existence
of an Alternate Payee's right to, or assigns to an Alternate Payee the
right to receive all or a portion of the Plan benefits payable with respect
to a Participant or Former Participant; and
(ii) In the order clearly specifies (A)
the name and last known mailing address (if any) of the Participant or
Former Participant, and of each Alternate Payee covered by the order, (B)
the amount or percentage of the Participant's or Former Participant's
benefits to be paid by the Plan to each Alternate Payee, or the manner in
which such amount or percentage is to be determined, (C) the number of
payments or period to which such order applies, and (D) each plan to which
such order applies; and
(iii) Does not require the Plan to provide
any type or form of benefit, or any option, not otherwise provided by the
Plan; and
(iv) Does not require the Plan to provide
increased benefits, determined on the basis of actuarial value; and
(v) Does not require the payment of
benefits to an Alternate Payee which are required to be paid to another
Alternate Payee under another order previously determined to be a Qualified
Domestic Relations Order; and
(vi) In the case of any payment before a
Participant has separated from Service, does not require payment to the
Alternate Payee before the earlier of (A) the date the Participant or
Former Participant is entitled to a distribution under the Plan, or (B) the
later of the date the Participant or Former Participant attains age fifty
or the earliest date on which he could begin receiving benefits if he
separated from Service; and
(vii) In the case of an order which
requires benefits to be paid to an Alternate Payee as if the Participant
had retired on the date payment is to begin under such order, only takes
into account the present value of benefits actually accrued using, in the
event the Plan is a defined benefit plan, the interest rate specified in
the Plan for determining actuarial equivalence, (or five percent if no
interest rate is specified); and
<PAGE>
(viii) Requires payment in a form provided
by the Plan, except that in no event may payment be in the form of a joint
and survivor annuity with respect to the Alternate Payee and his subsequent
spouse.
<PAGE>
ARTICLE 7. TRUST FUND AND THE TRUSTEE
7.1 Trust Fund: All contributions under this Plan shall be paid
to the Trustee and deposited in the Trust Fund. All assets of the Trust
Fund, including investment income, shall be retained for the exclusive
benefit of Participants, Former Participants, and Beneficiaries and shall
be used to pay benefits to such persons or to pay administrative expenses
of the Plan and Trust Fund to the extent not paid by the Employer, and
shall not revert to or inure to the benefit of the Employer.
At the Employer's request, a contribution made to the Trust under a
good faith mistake of fact or a good faith mistake in determining the
deductibility of a contribution will revert and be returned to the Employer
in the amount determined as follows: The amount which may be returned is
the amount contributed minus the amount which would have been contributed
in the absence of the mistake, exclusive of earnings thereon but reduced by
losses attributable thereto; provided, no Participant's account may be
reduced by the reversion to an amount less than the account would have been
if the mistake had not occurred. If the Plan fails to qualify upon its
initial submission to the Internal Revenue Service for a determination
under the Code, the entire assets of the Trust will revert to the Employer,
except that Salary Deferral Contributions and rollover contributions shall
be returned to the Participant making or electing such contributions. In
either case, the return to the Employer of the appropriate amount must be
made within one year of the mistaken payment of the contribution or
disallowance of the deduction or the date of denial of qualification.
7.2 Trustee: The Trustee shall receive, hold, invest,
administer, and distribute the Trust Fund in accordance with the provisions
of the Plan as herein set forth. The interest of others in the assets of
the Trust Fund shall be only the right to have such assets received, held,
invested, administered, and distributed in accordance with the provisions
of the Plan.
7.3 Records and Accounts of Trustee: The Trustee shall maintain
accurate and detailed records and accounts of all transactions of the Plan,
which shall be available at all reasonable times for inspection or audit by
any person designated by the Employer and by any other person or entity to
the extent required by law.
7.4 Basis for Accounts: All accounts of the Trustee shall be
kept on a consistent basis and shall be based on the fair market value of
the assets held in the Trust Fund.
7.5 Annual Reports: As soon as practicable following the close
of each Plan Year and following the effective date of the termination of
the Plan, the Trustee shall file with the Committee, as the Plan
Administrator, a written report setting forth all transactions with respect
to the Trust Fund during such Plan Year or during the period from the close
of the last Plan Year to the date of such termination and listing the
assets of the Trust Fund and the fair market value thereof as of the close
of the period covered by such report. The Trustee shall also provide the
Committee, as the Plan Administrator, with such other information in its
possession as may be necessary for the Committee and the Employer to
conform with the requirements of Section 103 of ERISA.
<PAGE>
7.6 Investment of the Trust Fund: Except as otherwise provided
in the Plan, the net income and profits of the Trust Fund shall be
accumulated, added to the principal of the Trust Fund and invested and
reinvested therewith as a single fund. Subject to direction by the
Investment Manager or of the Committee, the Trustee is authorized to invest
the Trust Fund in such bonds, notes, debentures, mortgages, equipment trust
certificates, investment trust certificates, preferred or common stocks,
open-end and closed-end mutual funds, deposit administration contracts,
fixed and variable annuity or other insurance contracts, and in such other
property, real or personal, within the United States, as the Trustee may
deem advisable, subject to the provisions of Sections 404 and 406 of
ERISA. Furthermore, the Trustee may invest up to fifty percent of the
total value of the Trust Fund represented by Employer Contribution Accounts
at the time of such investment in qualifying Employer securities of the
Employer and/or in qualifying Employer real property of the Employer as
those terms are defined in ERISA, and any investment presently maintained
in Employer's securities and/or real property may be continued, subject to
the provisions of ERISA. Notwithstanding the foregoing, no monies in a
Participant's Salary Deferral Account, Rollover Account, or other monies
derived from a Participant's "buy-back" of Forfeitures (as described in
Section 4.6) actually may be invested in Employer securities unless it is
established that such Plan investments have been registered or otherwise
approved under relevant securities laws. The Trustee in its discretion may
hold in cash such portion of the Trust Fund as shall be reasonable under
the circumstances, pending investment or payment of expenses or
distribution of benefits. Trustees may earmark specific investments
(including insurance contracts), but only if the Participant for whom such
earmarked investment is made has consented to the investment or if such
earmarked investments are purchased ratably for all Participants.
7.7 Investments in Pooled Fund: Notwithstanding any other
provision of this Article, all or any part of the assets may be invested in
any collective investment trust (including a collective investment trust
maintained by a bank which is the Trustee) which then provides for the
pooling of the assets of plans described in Code Section 401(a) and exempt
from taxation under Code Section 501(a) (whether or not such collective
investment trust provides for the pooling of assets of other tax-exempt
trusts), provided that such collective investment trust is exempt from tax
under the Code or regulations or rulings issued by the Internal Revenue
Service. The provisions of the document governing any such collective
investment trust, as amended from time to time, shall govern any investment
therein and are hereby made a part of this Plan and Trust.
7.8 Collective Investment Subaccounts:
(a) Collective Investment Funds: The Trustee may
develop, pursuant to any general investment guidelines or funding policy
provided by the Committee, separate Trustee-sponsored or Investment
Manager-sponsored collective investment funds (which may be pooled funds
under Section 7.7 or funds in which only this Trust may invest) among which
Plan Participants may direct investment of any amounts in their accounts,
less loans under Section 6.6. Investments of each such collective
investment fund shall be managed and otherwise shall be the responsibility
of the Trustee (or Investment Manager appointed by the Employer's Board of
<PAGE>
Directors to manage the fund), and separate records shall be maintained to
record the performance and Income of each such fund.
(b) Subaccounts: The Committee shall cause separate
subaccounts to be maintained to reflect each Participant's direction among
each collective investment fund, and each such subaccount shall be adjusted
each Valuation Date to reflect its share of the Income of the collective
investment fund of which it is a part. Distributions and Forfeitures from
accounts of a Participant, and contributions allocated to the accounts of a
Participant shall be allocated by the Trustee among the Participant's
collective investment subaccounts pursuant to the most recent direction of
the Participant, subject to the reasonable rules and procedures of the
Committee and Trustee.
(c) Direction: Direction among such collective
investment funds by a Participant shall be given in writing to the
Committee on such forms and pursuant to other reasonable rules and
procedures of the Committee and Trustee as to time, percentage and amount.
Any such direction once made shall remain in effect as to contributions,
Forfeitures and distributions for that Plan Year and succeeding Plan Years,
unless the Participant shall file a timely application made in accordance
with applicable Committee and Trustee rules and procedures which
effectively redesignates the investment of his account. In the event a
Participant shall fail for any reason to make an effective direction of his
accounts at a time when different collective investment funds are
available, then the amounts in his accounts shall be deemed to have been
designated to a fund or funds as selected by the Trustee to apply in such
instances, subject to any funding policy statement or any other
restrictions or guidelines provided by the Committee and to the standards
that would be followed by a prudent fiduciary in similar circumstances.
7.9 Trustee's Powers: The Trustee shall have the following
powers, rights and duties in addition to those vested in it elsewhere in
the Plan or by law, subject to any funding policy statement or any other
restrictions or guidelines by the Committee and to the standards that would
be followed by a prudent fiduciary in similar circumstances:
(a) Control Assets: To retain, manage, improve, repair,
operate and control any assets of the Trust Fund;
(b) Dispose of Assets: To sell, convey, transfer,
exchange, partition, grant options with respect to, lease for any term
(even though such terms extend beyond the duration of this Trust Fund or
commence in the future), mortgage, pledge or otherwise deal with or dispose
of any asset of the Trust Fund in such manner, for such consideration and
upon such terms and conditions as the Trustee, in its discretion, shall
determine;
(c) Bank Deposits: To invest the Trust Fund in deposits
(and in certificates of deposit) which bear a reasonable interest rate in
any bank, including a bank which is acting as Trustee;
<PAGE>
(d) Employ Agents: To employ such agents and counsel as
may be reasonably necessary in collecting, managing, administering,
investing, distributing and protecting the Trust Fund or the assets thereof
and to pay them reasonable compensation;
(e) Settle Claims: To settle, compromise or abandon all
claims and demands in favor of or against the Trust Fund;
(f) Borrow Money: To borrow money for the Trust Fund
from anyone, other than a "party in interest" as defined in Section 3(14)
of ERISA, with or without giving security from the Trust Fund;
(g) Deal with Corporations: To vote any corporate stock
either in person or by proxy for any purpose; to exercise any conversion
privilege, subscription right, or any other right or option given to the
Trustee as the owner of any security owned by the Trust Fund and to make
any payments incidental hereto; to consent to, take any action in
connection with, and receive and retain any securities resulting from any
reorganization, consolidation, merger, readjustment of the financial
structure, sale, lease, or other disposition of the assets of any
corporation or other organization, the securities of which may be an asset
of the Trust Fund;
(h) Organize Corporations: To organize and incorporate
(or participate in the organization or incorporation of) under the laws of
any state, a corporation for the purpose of acquiring and holding title to
any property which the Trustee is authorized to acquire for the Trust Fund
and to exercise with respect thereto any of the powers, rights and duties
it has with respect to other assets of the Trust Fund;
(i) Facility of Title: To cause title to the assets of
the Trust Fund to be held in the name of the Trustee, in the name of a
nominee, in a broker's street name, in bearer form so that title will pass
by delivery, or in any other manner authorized by applicable law in effect
from time to time, provided the records of the Trustee shall indicate the
true ownership of such asset; and
(j) General Powers: To exercise any of the powers and
rights of an individual owner with respect to any property of the Trust
Fund and to do all other acts in its judgment necessary or desirable for
the proper administration of the Trust Fund although the power to do such
acts is not specifically set forth herein.
7.10 Consultation with Counsel: The Trustee may consult with
legal counsel, who may be counsel for the Employer, in respect to any of
its rights, duties or obligations hereunder.
7.11 Compensation and Expenses: All reasonable costs, charges
and expenses incurred by the Trustee in connection with its administration
of the Plan and Trust Fund (including, without limitation, fees for legal
or accounting services rendered to the Employer, Trustee and/or Committee,
fees for investment advisors and related services, and such reasonable
compensation to the Trustee as may be agreed upon from time to time between
the Employer and the Trustee) may be paid by the Employer, but if not paid
<PAGE>
by the Employer, shall be paid from the Trust Fund. The Trustee also may
reimburse the Employer for such reasonable costs, charges and expenses
related to the administration of the Plan and Trust in accordance with
applicable regulations under ERISA. Provided, however, a Trustee who is an
Employee of the Employer shall not receive any compensation from the Trust
Fund for serving as Trustee (although such compensation may be paid by the
Employer), but may be reimbursed from the Trust Fund or by the Employer for
reasonable costs and expenses incurred by him in connection therewith.
Any administration expense paid to the Trust Fund as a
reimbursement shall not be considered an Employer Contribution.
7.12 Resignation, Removal, and Successor Trustee:
(a) Resignation of Trustee: The Trustee may resign from
the Trust at any time by giving ten days prior written notice thereof to
the Employer, and such resignation shall take effect ten days from the date
of the delivery of such written notice (or at such earlier time agreed to
by the Employer and the Trustee), or upon the appointment of a successor
Trustee pursuant to Section 7.12(c), whichever shall first occur. Upon
such resignation becoming effective, the Trustee shall render to the
Employer an account of the administration of the Plan during the period
following that which was covered by the last annual accounting, and the
Trustee shall perform all acts necessary to transfer and deliver the assets
of the Trust and any and all information in connection therewith or the
administration thereof to its successor Trustee.
(b) Removal of Trustee: The Employer may remove the
Trustee at any time upon the delivery of prior written notice thereof to
the Trustee. In the event of such removal, the Trustee shall be under the
same duties to account and to transfer and deliver the assets of the Trust
and any and all information in connection therewith or the administration
thereof to its successor Trustee as provided hereinabove in the event of
the Trustee's resignation.
(c) Successor Trustee: In the event of a vacancy in the
trusteeship of the Plan occurring at any time, the Employer shall designate
and appoint a qualified successor Trustee of the Plan. Any successor
Trustee shall have all the rights and powers and all of the duties and
responsibilities herein conferred upon the original Trustee. If a
successor Trustee is not appointed within sixty days after the Trustee
gives notice of its resignation pursuant to Section 7.12(a) above, the
Trustee may apply to any court of competent jurisdiction for appointment of
a successor.
7.13 Acts of Multiple Trustee: If the Trustee consists of more
than one individual or entity, all acts and decisions of the Trustee shall
be by vote of the majority of them, provided, that the signature on any
document (other than an amendment to the Plan or Trust) of any one such
individual or entity constituting the Trustee shall be sufficient evidence
to any party that such document is valid and in accordance with the terms
of this Plan and Trust.
<PAGE>
7.14 Indemnification of Individual Trustee: The Employer shall
indemnify and save harmless the Trustee to the maximum extent permitted
under ERISA against any and all claims, losses, damages, expenses, and
liabilities the Trustee may incur in the exercise and performance of its
duties hereunder, unless such actions are determined to be due to gross
misconduct. The Plan (at the Committee's direction) or the Employer may
purchase insurance for the Plan and any or all Fiduciaries to cover any
liability or loss resulting from Fiduciary acts or omissions; provided,
that any such insurance which is purchased by the Plan with the Plan's
assets must permit recourse by the insurer against the Fiduciary to the
extent required by ERISA.
<PAGE>
ARTICLE 8. ADMINISTRATION
8.1 Allocation of Responsibility Among Fiduciaries for Plan and
Trust Administration: The Fiduciaries shall have only those powers,
duties, responsibilities, and obligations as are specifically given them
under this Plan and Trust.
(a) Employer Responsibilities: In general, the Employer
shall have the sole responsibility for making the contributions provided
for under Section 4.1 and through the Board of Directors shall have the
sole authority to appoint and remove the Trustee, members of the Committee,
and any Investment Manager and to amend or terminate, in whole or in part,
this Plan and Trust.
(b) Committee Responsibilities: The Committee shall
have the sole responsibility for the administration of this Plan, which
responsibility is specifically described in this Plan and the Trust.
(c) Trustee Responsibilities: The Trustee (subject to
such directions as may be given by the Committee and/or any Investment
Manager) shall have the sole responsibility for the administration of the
Trust and the management of the assets held under the Trust, all as
specifically provided in the Trust.
(d) Investment Manager Responsibilities: If any
Investment Manager is appointed as described above, then it shall have the
sole responsibility for the management of the Trust assets under its
control.
Each Fiduciary warrants that any directions given, information furnished,
or action taken by it shall be in accordance with the provisions of the
Plan and Trust authorizing or providing for such direction, information, or
action. Furthermore, each Fiduciary may rely upon any such direction,
information or action of another Fiduciary as being proper under this Plan
and Trust, and is not required under this Plan and Trust to inquire into
the propriety of any such direction, information, or action. It is
intended under this Plan and Trust that each Fiduciary shall be responsible
for the proper exercise of its own powers, duties, and responsibilities and
not for any act or failure to act of another Fiduciary. No Fiduciary
guarantees the Trust Fund in any manner against investment loss or
depreciation in asset value.
8.2 Appointment of Committee: The Plan shall be administered by
a Committee consisting of at least one person who shall be appointed by and
serve at the pleasure of the Board of Directors. All usual and reasonable
expenses of the Committee (including, without limitation, fees for legal
services, accounting services and investment related services) may be paid
in whole or in part by the Employer, and any expenses not paid by the
Employer shall be paid by the Trustee out of the principal or income of the
Trust Fund. Provided however, except as otherwise provided under ERISA and
regulations thereunder, no person who is an Employee of the Employer shall
receive any compensation from the Trust Fund with respect to his services
for the Committee (although such compensation may be paid to that person
<PAGE>
by the Employer), but may be reimbursed from the Trust Fund or by the
Employer for reasonable costs and expenses incurred in connection
therewith. Any administrative expenses paid to the Trust Fund as a
reimbursement shall not be considered an Employer Contribution. In the
absence of the appointment of a Committee, the Employer shall be the Plan
Administrator whose duties shall include all those duties given to the
Committee under this Plan.
8.3 Claims Procedure: The Committee shall make all
determinations as to the right of any person to a benefit. All claims for
benefits shall be presented by the Participant or his Beneficiary to the
Committee on application forms provided by the Committee. Such Participant
or Beneficiary will subsequently be notified in writing of acceptance or
denial in whole or in part of his claim. In the event of denial, the
notification shall specify the reason(s) for denial, refer to Plan
provisions on which the denial is based, include a description of any
additional material or information necessary and an explanation of why it
is necessary, and advise the Participant or Beneficiary of the procedure
for appeal of such denial. The Participant or Beneficiary whose claim has
been denied shall file a written notice of desire to appeal the denial
within sixty days of notification of claim denial by the Committee,
including all of the facts upon which the appeal is based. The Committee
shall arrange a conference with the claimant within thirty days after the
date of the appeal; if the claim cannot be resolved at such conference, a
hearing will be held before the Committee within sixty days of the date of
appeal. At the hearing, the Participant or Beneficiary, or his
representative may present relevant evidence, written issues and comments.
Within sixty days after the hearing, the Committee shall render a
determination upon the appealed claim, accompanied by a written statement
as to the reasons therefor. The determination so rendered shall be final
and binding upon all parties.
8.4 Records and Reports: The Committee shall exercise such
authority and responsibility as it deems appropriate in order to comply
with ERISA and government regulations issued thereunder relating to records
of Participants' Service, account balances and the percentage of such
account balances which are nonforfeitable under the Plan; notifications to
Participants; annual registrations with the Internal Revenue Service; and
annual reports to the Department of Labor.
8.5 Other Committee Powers and Duties: The Committee shall have
such duties and powers as may be necessary to discharge its duties
hereunder, including, but not by way of limitation, the following:
(a) To construe and interpret the Plan (including,
without limitation, any of its terms which are uncertain, doubtful or
disputed), decide all questions of eligibility and determine the amount,
manner and time of payment of any benefits hereunder;
(b) To prescribe requirements, guidelines and procedures
to be followed by Participants or Beneficiaries in making elective salary
deferrals and in filing applications for benefits, loans or withdrawals;
<PAGE>
(c) To prepare and distribute, in such manner as the
Committee determines to be appropriate, information explaining the Plan;
(d) To receive from the Employer and from Participants
such information as shall be necessary for the proper administration of the
Plan;
(e) To furnish the Employer, upon request, such annual
reports with respect to the administration of the Plan as are reasonable
and appropriate;
(f) To receive, review, and keep on file (as it deems
convenient or proper) reports of the financial condition, and of the
receipts and disbursements, of the Trust Fund from the Trustee;
(g) To appoint or employ individuals to assist in the
administration of the Plan and Trust, and any other agents it deems
advisable, including legal and actuarial counsel;
(h) To develop and carry out a funding and/or investment
policy in cooperation with the Trustee (and an Investment Manager, if any)
consistent with the aims and objectives of the Plan.
The Committee shall have no power to add to, subtract from, or
modify any of the explicit terms of the Plan, or to change or add to any
specific benefits provided by the Plan, or to waive or fail to apply any
specific requirements of eligibility for a benefit under the Plan.
However, any construction or interpretation of the Plan's provisions or
decisions as to benefits under this Plan which is adopted by the Committee
in good faith shall be binding upon all parties to or Beneficiaries of the
Plan, subject only to any administrative intra-Plan rights of review
provided by this Plan's claim procedure.
8.6 Rules and Decisions: The Committee may adopt such rules as
it deems necessary, desirable, or appropriate. All rules and decisions of
the Committee shall be uniformly and consistently applied to all
Participants in similar circumstances. When making a determination or
calculation, the Committee shall be entitled to rely upon information
furnished by a Participant or Beneficiary, the Employer, the legal counsel
of the Employer, or the Trustee.
8.7 Committee Procedures: The Committee may act at a meeting or
in writing without a meeting. The Committee shall elect one of its members
as chairman, appoint a secretary, who may or may not be a Committee member,
and advise the Trustee of such actions in writing. The secretary shall
keep a record of all meetings and forward all necessary communications to
the Employer or the Trustee. The Committee may adopt such by-laws and
regulations as it deems desirable for the conduct of its affairs. All
decisions of the Committee shall be made by the vote of the majority
including actions in writing taken without a meeting; provided, that the
Committee may adopt rules whereby one or more Committee members may act for
the Committee either with respect to all Committee duties or only as to
specific Committee duties. A dissenting Committee member who, within a
reasonable time after he has knowledge of any action or failure to act by
<PAGE>
the majority, registers his dissent in writing delivered to the other
Committee members, the Employer, and the Trustee, shall not be responsible
for any such action or failure to act.
8.8 Authorization of Benefit Payments: The Committee shall
issue directions to the Trustee concerning all benefits which are to be
paid from the Trust Fund pursuant to the provisions of the Plan.
8.9 Application and Forms for Benefits: The Committee may
require a Participant to complete and file with the Committee an
application for a benefit on forms approved by the Committee, and to
furnish any other pertinent information requested by the Committee. The
Committee may rely upon all such information so furnished it, including the
Participant's current mailing address.
8.10 Facility of Payment: Whenever, in the Committee's opinion,
a person entitled to receive any payment of a benefit or installment of a
benefit hereunder is under a legal disability or is incapacitated in any
way so as to be unable to manage his financial affairs, the Committee may
direct the Trustee to make payments to such person or to his legal
representative or to a relative or friend of such person for his benefit,
or the Committee may direct the Trustee to apply the payment for the
benefit of such person in such manner as the Committee considers
advisable. Any payment of a benefit or installment thereof in accordance
with the provisions of this Section shall be a complete discharge of any
liability for the making of such payment under the provisions of the Plan.
8.11 Inability to Locate Participant, Surviving Spouse or
Beneficiary: In the event that a Participant, Surviving Spouse or
Beneficiary entitled to receive Plan benefits fails to respond or cannot be
located by the Committee within six months following the sending of notice
by certified mail to his last known address, his Plan benefits shall be
declared by the Committee to be forfeited and shall be used to reduce the
Employer Contribution on the next Valuation Date. If the Participant,
Surviving Spouse or Beneficiary is later located or makes a claim for
benefits, any amount treated as a Forfeiture by reason of this Section
shall be reinstated by the Committee from a special Employer Contribution
or from Forfeitures available in the year of reinstatement.
8.12 Omission of Eligible Employee: If, in any Plan Year, any
Employee who should be included as a Participant in the Plan is erroneously
omitted and discovery of such omission is not made until after a
contribution by the Employer for the year has been made and allocated, the
Employer shall make a subsequent contribution with respect to the omitted
Employee in the amount which the said Employer would have contributed with
respect to him had he not been omitted. Such contribution shall be made
regardless of whether or not it is deductible in whole or in part in any
taxable year under applicable provisions of the Code by such Employer.
8.13 Inclusion of Ineligible Employee: If, in any Plan Year, any
person who should not have been included as a Participant in the Plan is
erroneously included and discovery of such incorrect inclusion is not made
until after a contribution for the year has been made and allocated, the
appropriate Employer shall not be entitled to recover the contribution made
with respect to the ineligible person regardless of whether or not a
<PAGE>
deduction is allowable with respect to such contribution. In such event,
the amount contributed with respect to the ineligible person shall
constitute a Forfeiture for the Plan Year in which the discovery is made.
8.14 Bonding: Every Fiduciary (including any Committee and any
employee of the Employer who handles the Plan's contributions,
distributions or assets), except a bank or an insurance company, unless
exempted by ERISA and regulations thereunder, shall be bonded in an amount
not less than ten percent of the amount of the funds such Fiduciary
handles; provided, however, that the minimum bond shall be $1,000 and the
maximum bond, $500,000. The amount of funds handled shall be determined at
the beginning of each Plan Year by the amount of funds handled by such
person, group, or class to be covered and their predecessors, if any,
during the preceding Plan Year, or if there is no preceding Plan Year, then
by the amount of the funds to be handled during the then current year. If
the amount handled cannot be determined with reasonable accuracy, then it
may be deemed to be the total amount of Plan assets at the end of the
preceding Plan Year. The bond shall provide protection to the Plan against
any loss by reason of acts of fraud or dishonesty by the Fiduciary alone or
in connivance with others. The surety shall be a corporate surety company
(as such term is used in Section 412(a)(2) of ERISA), and the bond shall be
in a form approved by the Secretary of Labor. Notwithstanding anything in
the Plan to the contrary, the cost of such bonds shall be an expense of and
may, at the election of the Committee, be paid from the Trust Fund or by
the Employer.
8.15 Indemnification: The Employer shall indemnify and save
harmless the Committee members to the maximum extent permitted under ERISA
against any and all claims, losses, damages, expenses and liabilities the
Committee may incur in the exercise and performance of its duties
hereunder, unless such actions are determined to be due to gross negligence
or willful misconduct.
8.16 Plan Administrator's Discretion to Interpret the Plan: It
is the Plan settlor's original intention that the Committee, as Plan
Administrator under this Plan (which term includes for these purposes all
related documents, including, but not limited to, insurance or trust
documents), in addition to the authority granted in Section 8.5 above, has
discretionary authority to interpret and construe this Plan's provisions as
necessary to determine eligibility for benefits and otherwise to construe
disputed, doubtful or uncertain terms under the Plan.
<PAGE>
ARTICLE 9. INSURANCE CONTRACTS
9.1 Purchase of Insurance Contracts: Subject to the limitations
as set forth in Section 9.4(a) hereof, the Trustee shall invest such
portion or percentage of each Participant's Salary Deferral Account and/or
Employer Contribution Account in insurance contracts as the Committee may
direct. All premium payments on insurance contracts shall be an investment
for the account of the Participant for whom such contract is issued.
9.2 Types of Insurance Contracts: The types of insurance
contracts to be made available shall be fixed by agreement between the
Committee and the Insurer and may be modified from time to time. Such
types may include, but need not be limited to, ordinary life insurance
policies with cash values.
9.3 Ownership and Beneficiary of Insurance Contracts: Each
contract issued hereunder shall be held by the Trustee as owner and
beneficiary thereof and shall provide that the right to change the
beneficiary and to exercise all options and privileges available under the
contract shall vest in the Trustee. Such options and privileges shall be
exercised only in accordance with the terms of this Agreement.
9.4 Special Provisions Affecting Insurance Contracts:
(a) Limitation on Amount: The aggregate of the premiums
paid by the Trustee from Employer Contributions (including contributions
made under Section 401(k) of the Code) with respect to any Participant:
(1) for ordinary life insurance protection, shall
always be less than fifty percent; or
(2) for term, universal life insurance protection
and all other life insurance contracts that are not ordinary life
insurance, shall always be less than twenty-five percent; or
(3) where there is both ordinary, term and/or
universal life insurance with respect to a Participant, the sum of one-half
of the ordinary life premium(s) and all other life insurance premiums shall
always be less than twenty-five percent
of the aggregate of the Salary Deferral Contributions plus all Employer
Contribution(s) made on behalf of such Participant at any time without
regard to Trust earnings, capital gains and losses. If at any time the
total investment of a Participant's account in life insurance premiums,
together with the current premium payable, equals or exceeds the maximum
above specified, the amount of life insurance in effect with respect to
said Participant's account shall be reduced so that the premium test herein
set forth shall be satisfied.
<PAGE>
(b)aluation of Insurance Contracts: Insurance contracts
shall have a value as determined by the Insurer on the basis of the then
current cash value thereof and any accumulations attributable to such
contracts by reason of interest or dividend credits. All insurance
contracts held as investments by individual accounts shall be valued at
zero for the purposes of allocating Income to said individual accounts.
(c) Dividends: All dividends payable on insurance
contracts held under the terms of this Plan and forming a part of the Trust
shall be held by the Insurer and, at the direction of the Participant,
shall be used to purchase paid-up additions, or shall be held by the
Insurer at interest or shall be paid to the Trustee to be invested in such
manner as the Committee may direct.
(d) Termination of Employment: Upon a Participant's
termination of employment, subject to the vesting provisions of Section 6.3
hereof, any insurance contract(s) held for such Participant may be (i)
surrendered by the Trustee for its cash value, (ii) assigned by the Trustee
to the Participant, or (iii) purchased by the Participant from the Trustee.
(e) Retirement: At or before the retirement of a
Participant, the Trustee shall, at the direction of the Committee, (i)
convert the entire value of insurance contracts held as an investment for
such Participant's individual account which provide ordinary life insurance
protection into cash, or (ii) distribute such contracts to the Participant;
provided that if no annuity distribution option is provided under Article
6, then no insurance contract which is distributed shall contain an annuity
option.
(f) No Annuity Options Permitted: No insurance contract
may be distributed in kind to any Participant, Former Participant, or
Beneficiary which is in the form of a life annuity or which contains a life
annuity conversion option.
9.5 Death Prior to Issuance of Insurance Contract: If a
Participant shall die after the Trustee has been directed by the Committee
to invest a percentage of the contribution made on such Participant's
behalf in insurance contracts, but before a policy shall be in force on his
life, there shall be paid to the Beneficiary designated pursuant to Section
6.2(b) hereof death benefits in accordance with the provisions of Section
6.2 hereof as if such direction had not been given.
9.6 Special Rules Regarding Investment in Insurance for Spouse
and/or Children: Benefits payable with respect to a life insurance policy
on the life of a Participant's spouse or children shall be paid to the
Participant's account to the extent of the cash value of the policy on the
date of the spouse's or child's death. Any benefits in excess of the cash
value shall be paid directly to the Participant.
9.7 Status of Insurer: The Insurer by issuing insurance
contracts pursuant to the Plan shall be deemed to agree to supply annually
such information about each transaction affecting a Participant as the
Secretary of the Treasury or his delegate or any other regulatory
officials, state or federal, shall prescribe, and otherwise to comply with
the terms of this Plan and Trust.
<PAGE>
ARTICLE 10. MISCELLANEOUS
10.1 Nonguarantee of Employment: Nothing contained in this Plan
shall be construed as a contract of employment between the Employer and any
employee, or as a right of any employee to be continued in the employment
of the Employer, or as a limitation of the right of the Employer to
discharge any of its employees, with or without cause.
10.2 Rights to Trust Assets: No Employee or Beneficiary shall
have any right to, or interest in, any assets of the Trust Fund upon
termination of his employment or otherwise, except as provided from time to
time under this Plan, and then only to the extent of the benefits payable
under the Plan to such Employee out of the assets of the Trust Fund. All
payments of benefits as provided for in this Plan shall be made solely out
of the assets of the Trust Fund and none of the Fiduciaries shall be liable
therefor in any manner.
10.3 Nonalienation of Benefits: The Trust Fund shall not in any
manner be liable for, or subject to, the debts, contracts, liabilities,
engagements, or torts of any person entitled to benefits hereunder.
Benefits payable under this Plan shall not be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge, encumbrance,
charge, garnishment, execution, or levy of any kind, either voluntary or
involuntary, including any such liability which is for alimony or other
payments for the support of a spouse or former spouse, or for any other
relative of the Employee, prior to actually being received by the person
entitled to the benefit under the terms of the Plan; and any attempt to
anticipate, alienate, sell, transfer, assign, pledge, encumber, charge or
otherwise dispose of any right to benefits payable hereunder, shall be
void. The preceding sentence shall not apply to (a) the creation,
assignment or recognition of a right to any benefit payable with respect to
a Participant pursuant to an order which is determined under Section 6.7 to
be a Qualified Domestic Relations Order as defined in Code Section 414(p),
which was entered into on or after January 1, 1985 or (b) any other
alienation permitted under Code Section 401(a)(13) or rules and regulations
thereunder. Provided, that a Beneficiary who has been designated in
accordance with Article 6 to receive benefits in the event of a
Participant's death may elect to disclaim all or any part of such benefits
in favor of another designated Beneficiary.
10.4 Discontinuance of Employer Contributions: In the event of
permanent discontinuance of contributions to the Plan by the Employer, the
accounts of all Participants shall, as of the date of such discontinuance,
become nonforfeitable.
<PAGE>
ARTICLE 11. AMENDMENTS AND ACTION BY EMPLOYER
11.1 Amendments: The Parent Company reserves the right to make
from time to time any amendment or amendments to this Plan, including its
related Trust, which does not cause any part of the Trust Fund to be used
for, or diverted to, any purpose other than the exclusive benefit of
Participants, Former Participants, or their Beneficiaries; provided,
however, that the Parent Company may make any amendment it determines
necessary or desirable, with or without retroactive effect, to comply with
ERISA. No action of the participating Employers will be required to
implement or effectuate any amendment to the Plan made by the Parent
Company. The procedure followed for making any amendment shall consist of
the preparation of a written Plan amendment and its execution by one or
more officers of the Parent Company. Such amendment may, but need not, be
authorized (or later ratified) by the Parent Company's Board of Directors.
No amendment made by the Parent Company shall:
(a) Reduce the vested percentages (determined without
regard to such amendment as of the later of the date the amendment was
adopted or the date the amendment was effective) of any Participant; or
decrease the balance in any Participant's account; or eliminate an optional
form of benefit in violation of Code Section 411(d)(6) and regulations
thereunder, with respect to benefits attributable to Service prior to the
amendment;
(b) Provide for the use of any portion of the Trust Fund
for any purpose other than the exclusive benefit of Participants and
Beneficiaries, or provide that any portion of the Trust Fund shall ever
revert to or be used by the Employer, except as provided in Section 7.1; or
(c) Increase the duties or liabilities of the Employer,
the Committee or Trustee without its written consent.
11.2 Special Rules Regarding Amendments Relating to Vesting: In
the event the vesting provisions of the Plan are amended, each Participant
in the Plan who has three (or five in the case of a Participant who does
not have at least one Hour of Service with the Employer for Plan Years
beginning after December 31, 1988) or more Years of Service shall be given
an election to have the nonforfeitable percentage of his Employer
Contribution Account determined without regard to such amendment. The
election period will begin the date the amendment is adopted and will end
on the last to occur of (a) sixty days after the day the amendment is
adopted, (b) sixty days after the day the amendment becomes effective, and
(c) sixty days after the date the Participant is given written notice of
the amendment and of the election by the Employer or the Committee. If the
election, as herein provided, is not given to any such Participant, his
nonforfeitable percentages under the Plan, as amended, cannot at any time
be less than such percentage determined without regard to such amendment.
<PAGE>
11.3 Action by Employer: Any action by the Employer under this
Plan may be by resolution of its board of directors, or by any person or
persons duly authorized by said board or having apparent authority by
virtue of his corporate office to take such action.
<PAGE>
ARTICLE 12. SUCCESSOR EMPLOYER AND MERGER
OR CONSOLIDATION OF PLANS
12.1 Successor Employer: In the event of the dissolution,
merger, consolidation, or reorganization of the Employer, provision may be
made by which the Plan and Trust will be continued by the successor; and,
in that event, such successor shall be substituted for the Employer under
the Plan. The substitution of the successor shall constitute an assumption
of Plan liabilities by the successor and the successor shall have all of
the powers, duties, and responsibilities of the Employer under the Plan.
12.2 Plan Assets in the Event of Merger or Consolidation of
Plans: In the event of any merger or consolidation of the Plan with, or
transfer in whole or in part of the assets and liabilities of the Trust
Fund to another trust fund held under, any other plan of deferred
compensation maintained or to be established for the benefit of all or some
of the Participants of this Plan, the assets of the Trust Fund applicable
to such Participants shall be transferred to the other trust fund only if:
(a) Each Participant would (if either this Plan or the
other plan then terminated) receive a benefit immediately after the merger,
consolidation, or transfer which is equal to or greater than the benefit he
would have been entitled to receive immediately before the merger,
consolidation, or transfer (if this Plan had then terminated);
(b) Resolutions of the Board of Directors shall
authorize such transfer of assets; and, in the case of the new or successor
employer of the affected Participants, its resolutions shall include an
assumption of liabilities with respect to such Participants' inclusion in
the new employer's plan; and
(c) Such other plan and trust are qualified under Code
Section 401(a) and Section 501(a).
<PAGE>
ARTICLE 13. PLAN TERMINATION
13.1 Right to Terminate: In accordance with the procedure set
forth in this Article, the Employer may terminate the Plan at any time. In
the event of the dissolution, merger, consolidation, or reorganization of
the Employer, the Plan shall terminate and the Trust Fund shall be
liquidated unless the Plan is continued by a successor to the Employer in
accordance with Section 12.1.
13.2 Partial Termination: Upon termination of the Plan with
respect to a group of Participants which constitutes a partial termination
of the Plan, the Trustee shall, in accordance with the directions of the
Committee, allocate and segregate for the benefit of the affected Employees
then or theretofore employed by the Employer with respect to which the Plan
is being terminated the amount necessary to pay the proportionate interest
of such Employees who are Participants in the Trust Fund. The funds so
allocated and segregated shall be used by the Trustee to pay benefits to or
on behalf of all affected Employees in accordance with Section 13.3.
13.3 Liquidation of the Trust Fund: Upon partial or complete
termination of the Plan, the accounts of all employees affected thereby
shall become fully vested and nonforfeitable, and the Committee shall
direct the Trustee to distribute (or transfer directly in accordance with
Section 6.4(g)) the assets remaining in the Trust Fund, after payment of
any expenses properly chargeable thereto, to Participants, Former
Participants, and Beneficiaries in proportion to their respective account
balances; provided, however, that any amounts properly allocated to the
Plan's Suspense Account, pursuant to Section 5.3 of the Plan, shall upon
termination of the Plan revert to the Employer. For purposes of
calculating Forfeitures with respect to any Former Participants who were
not employed on the Plan's termination date, but who still had account
balances in the Plan immediately prior to the Plan's termination, such
Former Participants' vested percentages shall be calculated in accordance
with the Plan's vesting schedule immediately prior to the Plan's
termination. Any amounts not vested with respect to such Former
Participants shall be treated as a Forfeiture under the Plan, and such
Former Participants shall be treated as if they had incurred five
consecutive Breaks in Service as of the date of Plan termination.
13.4 Manner of Distribution: To the extent that no
discrimination in value results, any distribution after termination of the
Plan may be made, in whole or in part, in cash, in securities or other
assets in kind, as the Committee (in its discretion) may determine;
provided, that if no annuity distribution option is permitted under Article
6 of the Plan, then no distribution upon termination may include an
annuity. All noncash distributions shall be valued at fair market value at
date of distribution.
<PAGE>
ARTICLE 14. RELATED CORPORATIONS
14.1 Joinder: Any corporation which is related to the Employer
by stock ownership may adopt this Plan and Trust by action of its board of
directors.
14.2 Contributions: Each corporation which joins the Plan and
Trust and thereby becomes an Employer hereunder shall make its own
contributions to the Plan, except to the extent otherwise permitted under
the Code.
14.3 Forfeitures: To the extent required by the Code and
regulations thereunder, Forfeitures arising in respect of the account of
one Employer will be used to reduce the Employer Contributions for that
Employer.
14.4 Common Service: For purposes of Participation and vesting,
transfer from one Employer to another shall not cause an interruption of
Service, and Service with an Aggregated Employer shall be credited from the
latter of the date the Plan was adopted or the date such corporation or
entity became an Aggregated Employer. However, in determining a
Participant's Service for benefit accrual purposes, only Service with an
Employer during periods of Participation under the Plan shall be taken into
account.
14.5 Commingling of Funds: Notwithstanding that the Plan may for
some purposes be considered the separate Plan of each Employer or that
contributions are made and Forfeitures are allocated separately, the assets
of the Plan and Trust may be invested and commingled as a single fund
without allocation on the books and records of the Trustee.
<PAGE>
IN WITNESS WHEREOF, the Employer and the Trustee have caused this
Plan and Trust to be properly executed on the 19th day of December, 1994.
FAMILY DOLLAR STORES, INC., and all
other Employers listed on the
attached Exhibit A
By: JOHN D. REIER
JOHN D. REIER
President
(Corporate Seal)
ATTEST:
GEORGE R. MAHONEY, JR.
GEORGE R. MAHONEY, JR.
Secretary
GEORGE R. MAHONEY, JR. (SEAL)
GEORGE R. MAHONEY, JR., Trustee
C. MARTIN SOWERS (SEAL)
C. MARTIN SOWERS, Trustee
JOHN D. REIER (SEAL)
JOHN D. REIER, Trustee
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT A
8/12/94 - FAMILY DOLLAR STORES, INC. ACTIVE CORPORATIONS
CORP. NO. CORPORATION NAME
<S> <C>
FAMILY DOLLAR STORES
1 OF SANDERSVILLE, GA., INC.
2 OF NORTH CAROLINA, INC.
7 OF SANFORD, INC.
8 OF WILMINGTON, INC.
10 INC. OF S. C.
11 OF MARTINSVILLE, VA., INC.
12 OF ROCK HILL, S. C., INC.
14 OF GAINESVILLE, GA., INC.
15 OF GASTONIA, INC.
22 OF ROANOKE, VA., INC.
26 OF HARRISONBURG, VA., INC.
31 OF AIRPORT CROSSROADS, INC.
32 OF TRAVELERS REST S.C. INC.
35 OF WINSTON-SALEM, INC.
36 OF GEORGIA, INC.
37 OF AUGUSTA, GA., INC.
39 OF THOMASVILLE, INC.
40 OF MECKLENBURG COUNTY INC.
42 OF HIGH POINT, INC.
43 OF HENRY COUNTY INC
45 OF EASLEY, S.C., INC.
46 OF GAFFNEY, S.C., INC.
47 OF LAURENS, S.C., INC.
48 OF CHESTER, S.C., INC.
49 OF NEWBERRY, S.C., INC.
53 OF BUENA VISTA, VA., INC.
60 OF WEST COLUMBIA, S. C., INC.
62 OF OCEAN DRIVE, S.C., INC.
65 OF BENNETTSVILLE, S.C., INC.
66 OF JAMES ISLAND, S.C., INC.
68 OF CUMBERLAND COUNTY, INC.
69 OF SMITHFIELD, INC.
73 OF UNION, S.C., INC.
76 OF BRISTOL, VA., INC.
77 OF ABBEVILLE, S.C., INC.
78 OF GALAX, VA., INC.
79 INC. (MISSISSIPPI)
80 OF MARION, VA., INC.
81 OF SPARTANBURG, S. C., INC.
83 OF GREENWOOD, S. C., INC.
86 OF HURT, VA., INC.
88 OF CONWAY, S.C., INC.
89 OF PONTOTOC, MISS., INC.
90 OF COMMERCE, GA., INC.
91 OF ANDERSON, S. C., INC.
93 OF ALBEMARLE, INC.
99 OF INMAN, S.C., INC.
<PAGE>
<S> <C>
101 OF LANCASTER COUNTY, S.C.,INC.
102 OF CAMDEN, S.C., INC.
103 OF ATHENS, GA., INC.
105 OF WINDER, GA, INC.
107 OF TOCCOA, GA., INC.
111 OF SENECA, S.C., INC.
112 OF SUMTER, S.C., INC.
115 OF WOODRUFF, S.C. INC.
116 OF ASHEVILLE, INC.
117 OF CHATSWORTH, GA., INC.
119 OF CHERAW, S.C. INC
121 OF PELZER, S.C., INC.
124 OF BATESBURG, S.C., INC.
125 OF DILLON, S.C., INC.
126 OF RICHMOND, VA., INC.
127 OF HARTSVILLE, S.C., INC.
128 OF CHASE CITY, VA., INC.
130 OF GREENVILLE, S.C., INC
131 OF ORANGEBURG, S. C., INC.
132 OF FLORENCE, INC.
135 OF DARLINGTON, S.C., INC.
136 OF WALTERBORO, S.C., INC.
137 OF SOUTH BOSTON, VA., INC.
138 OF MULLINS, S.C., INC.
147 OF PICKENS, S.C., INC.
149 OF GREER, S.C., INC.
152 OF ANDREWS, S.C., INC.
154 OF LAWRENCEVILLE, GA., INC.
156 OF LAKE CITY, S.C., INC.
158 OF ELBERTON, GA., INC.
159 OF YORK, S.C., INC.
160 OF THOMSON, GA., INC.
162 OF PENDLETON, S.C., INC.
165 OF PERRY,GA.INC.
167 OF CHARLESTON, S. C., INC.
168 OF GOOSE CREEK, S. C., INC.
174 OF NORTH AUGUSTA, S.C. INC.
175 OF EMPORIA, VA., INC.
176 OF CHESAPEAKE, VA., INC.
178 OF SUMMERVILLE, GA., INC.
179 OF LOUISA, VA., INC.
183 OF SWAINSBORO, GA., INC.
187 OF MANNING, S.C., INC.
189 OF HAMPTON, S. C., INC.
193 OF GEORGETOWN, SC. INC.
194 OF AIKEN, S. C., INC.
195 OF MCDONOUGH GA INC
199 OF MADISON, GA., INC.
200 OF MILLEDGEVILLE, GA., INC.
208 OF WINNSBORO, S.C., INC.
209 OF MONROE, GA., INC.
211 OF MONCKS CORNER, S.C., INC.
212 OF KINGSTREE, S. C., INC.
214 OF HARTWELL, GA., INC.
<PAGE>
<S> <C>
215 OF DOUGLAS, GA., INC.
218 OF FITZGERALD, GA.,INC.
219 OF CORNELIA, GA., INC.
222 OF PORTSMOUTH, VA., INC.
223 OF BLUE RIDGE, GA., INC.
224 OF NEWTON COUNTY GA INC
226 OF SYLVANIA, GA., INC.
227 OF MACON, GA., INC.
228 OF WARNER ROBINS,GA.,INC
229 OF CARROLLTON, GA., INC.
230 OF CARTERSVILLE,GA.,INC.
231 OF ATLANTA, GA., INC.
234 OF CLINTON, S. C., INC.
236 OF AMERICUS GA INC
237 OF SMYRNA, GA., INC.
240 OF WASHINGTON, GA., INC.
241 OF VIDALIA, GA., INC.
244 OF HENDERSON INC
246 OF FORT VALLEY GA INC
248 OF BARNWELL, S. C., INC.
252 OF MT. PLEASANT, S.C., INC.
255 OF DENMARK, S. C., INC.
261 OF CLINTON, INC.
262 OF BEAUFORT, S.C., INC.
263 OF ROSSVILLE, GA., INC.
265 OF CORDELE, GA., INC
267 OF GRIFFIN, GA., INC.
268 OF CHESTER, VA., INC.
270 OF JONESBORO, GA., INC.
272 OF FORT MILL, S.C., INC.
274 OF MARION, S. C., INC.
276 OF CEDARTOWN, GA., INC.
277 OF BARNESVILLE, GA., INC.
278 OF HOPEWELL, VA. INC.
279 OF ALBANY, GA., INC.
282 OF PULASKI, VA., INC
283 OF ROME, GA., INC.
285 OF SALEM, VA., INC.
286 OF OAK HILL, W. VA., INC.
287 OF SURFSIDE BEACH, S.C., INC.
289 OF DUBLIN, GA., INC.
290 OF CALHOUN, GA., INC.
297 OF SMITHFIELD, VA., INC.
299 OF ORANGE, VA., INC.
302 OF COVINGTON, VA., INC.
305 OF BECKLEY, W. VA., INC.
313 OF JACKSON, GA., INC.
315 OF SAVANNAH, GA., INC.
316 OF CHRISTIANSBURG, VA., INC.
318 OF NEWNAN, GA., INC.
321 OF PRINCETON, W. VA., INC.
322 OF COCHRAN, GA., INC.
<PAGE>
<S> <C>
324 OF THOMASTON, GA., INC.
325 OF WYTHEVILLE, VA., INC.
326 OF BEDFORD, VA.,INC.
327 OF LYNCHBURG, VA., INC.
329 OF CLIFTON FORGE, VA., INC.
331 OF ADEL, GA., INC.
332 OF MOULTRIE, GA., INC.
333 OF COLUMBUS, GA., INC.
335 OF SUFFOLK, VA., INC.
336 OF FARMVILLE, VA., INC.
338 OF NORFOLK, VA., INC.
340 OF SUMMERVILLE, S. C., INC.
341 OF ROCKY MOUNT, VA., INC.
343 OF STAUNTON, VA., INC.
345 OF DANVILLE, VA., INC.
346 OF SOUTH HILL, VA., INC.
348 OF CAMILLA, GA., INC.
349 OF QUITMAN, GA., INC.
350 OF DOUGLASVILLE, GA., INC.
351 OF BAXLEY, GA., INC.
357 OF TAZEWELL, VA., INC.
358 OF HAWKINSVILLE, GA., INC.
360 OF SPRING LAKE, INC.
362 OF LAFAYETTE, GA., INC.
363 OF MARIETTA, GA., INC.
364 OF MABLETON, GA., INC.
365 OF HAZLEHURST, GA., INC.
371 OF BLUEFIELD, W. VA., INC.
379 OF WAYNESBORO, MISS., INC.
380 OF HARRISVILLE, W. VA., INC.
381 OF HINESVILLE, GA., INC.
383 OF STATESBORO, GA., INC.
384 OF TIFTON, GA., INC.
385 OF CLAXTON, GA., INC.
389 OF DANVILLE, W. VA., INC.
394 OF OCEAN SPRINGS, MISS., INC.
397 OF FOREST PARK, GA., INC.
405 OF SYLACAUGA, ALA., INC.
415 OF TARRANT, ALA., INC.
420 OF VALDOSTA, GA., INC.
421 OF ELLIJAY, GA., INC.
422 OF CAIRO, GA., INC.
423 OF ROYSTON, GA., INC.
424 OF CUTHBERT, GA., INC.
442 OF MONTEZUMA, GA., INC.
443 OF ASHLAND, VA., INC.
444 OF HAMPTON, VA., INC.
446 OF SUMMERSVILLE, W. VA., INC.
448 OF MANCHESTER, GA., INC.
449 OF DOTHAN, ALA., INC.
454 INC. KENTUCKY
456 OF RUSSELL SPRINGS, KY., INC.
<PAGE>
<S> <C>
460 OF WEST VIRGINIA, INC.
464 OF RAINELLE, W. VA., INC.
469 OF ELKVIEW, W. VA., INC.
470 OF LITHONIA, GA., INC.
476 OF ELKTON, VA., INC.
480 OF SPRINGFIELD, TENN., INC.
481 OF VICTORIA, VA., INC.
482 OF TULLAHOMA, TENN., INC.
483 OF WISE, VA., INC.
484 OF BEATTYVILLE, KY., INC.
485 OF MAN, W. VA., INC.
492 OF VILLA RICA, GA., INC.
493 OF REIDSVILLE, GA., INC.
495 OF ESCATAWPA, MISS., INC.
496 OF HARRODSBURG, KY., INC.
497 OF COLUMBIA, S. C., INC.
498 OF FRANKFORT, KY., INC.
499 OF FAIRBURN, GA., INC.
500 OF BRUNSWICK, GA., INC.
502 OF LOGAN, W. VA., INC.
504 OF WRENS, GA., INC.
505 OF PENNINGTON GAP, VA., INC.
506 OF LAWRENCEBURG, KY., INC.
507 OF GREENSBORO, GA., INC.
508 OF ST. ALBANS, W. VA., INC.
509 OF HINTON, W. VA., INC.
513 OF CYNTHIANA, KY., INC.
517 OF NEWPORT NEWS, VA., INC.
518 OF ST. GEORGE, S. C., INC.
520 OF AMORY, MISS., INC.
521 OF WESTMINSTER, S. C., INC.
522 OF NINETY SIX, S. C., INC.
523 OF TUPELO, MISS., INC.
524 OF RICHLANDS, VA., INC.
526 OF GORDON, GA., INC.
530 OF CUMBERLAND, KY., INC.
532 OF GLASGOW, KY., INC.
535 OF ALABAMA, INC.
538 OF GRUNDY, VA., INC.
539 OF WATER VALLEY, MISS., INC.
540 OF OXFORD, MISS., INC.
542 OF FRANKLIN, VA., INC.
545 OF DREW, MISS., INC.
546 OF LELAND, MISS., INC.
547 OF GREENVILLE, MISS., INC.
548 OF RIPLEY, W. VA., INC.
549 OF MARLINTON, W. VA., INC.
559 OF JACKSON, MISS., INC.
560 OF STANFORD, KY., INC.
563 OF PHILIPPI, W. VA., INC.
564 OF FOLKSTON, GA., INC.
565 OF STARKVILLE, MISS., INC.
566 OF QUITMAN, MISS., INC.
<PAGE>
<S> <C>
570 OF NEW MARTINSVILLE,W.VA.,INC.
571 OF JENA, LA., INC.
572 OF WESTON, W. VA., INC.
573 OF ST. MARYS, W. VA., INC.
574 OF MANCHESTER, KY., INC.
577 OF SPENCER, W. VA., INC.
578 OF KINGWOOD, W. VA., INC.
579 OF HAZLEHURST, MISS., INC.
580 OF ABERDEEN, MISS., INC.
581 OF LAVONIA, GA., INC.
582 OF RIPLEY, TENN., INC.
583 OF MT. WASHINGTON, KY., INC.
584 OF NATCHEZ, MISS., INC.
585 OR ST. MARYS, GA., INC.
586 OF FAYETTE, MISS., INC.
587 OF STANTON, KY., INC.
591 OF BOGALUSA, LA., INC.
595 OF WESTERNPORT, MD., INC.
599 OF ARKANSAS, INC.
601 OF DEWITT, ARK., INC.
602 OF MCGEHEE, ARK., INC.
603 OF CROSSLANES, W. VA., INC.
605 OF INEZ, KY., INC.
606 OF LEITCHFIELD, KY., INC.
607 OF BAY ST. LOUIS, MISS., INC.
608 OF CANTON, MISS., INC.
609 OF MCKENZIE, TENN., INC.
612 OF CUMBERLAND, MD., INC.
613 OF HUNTINGDON, TENN., INC.
614 OF FLORIDA, INC.
617 OF BISHOPVILLE, S. C., INC.
618 OF CARTHAGE, MISS., INC.
620 OF LAGRANGE, GA., INC.
629 OF DAWSON, GA., INC.
632 OF HOLLY SPRINGS, MISS., INC.
633 OF TRENTON, TENN., INC.
636 OF RICHMOND, KY., INC.
637 OF KENNESAW, GA., INC.
643 OF SALYERSVILLE, KY., INC.
644 OF MARION, KY., INC.
649 OF LAKE PROVIDENCE, LA., INC.
651 OF CAMPBELLSVILLE, KY., INC.
652 OF RUSSELLVILLE, KY., INC.
655 OF NATCHITOCHES, LA., INC.
658 OF LEXINGTON, MISS., INC.
669 OF MARYLAND, INC.
670 OF VIDALIA, LA., INC.
671 OF LOUISA, KY., INC.
672 OF ABBEVILLE, LA., INC.
680 OF GREENUP, KY., INC.
683 OF SPARTA, TENN., INC.
685 OF IRVINE, KY., INC.
687 OF GLENVILLE, W. VA., INC.
688 OF FRANKLINTON, LA., INC.
<PAGE>
<S> <C>
691 OF HUNTINGTON, W. VA., INC.
692 OF HURRICANE, W. VA., INC.
694 OF WAYCROSS, GA., INC.
699 0F MEMPHIS, TENN., INC.
701 OF VANCEBURG, KY., INC.
703 OF GREENWOOD, MISS., INC.
704 OF BROOKHAVEN, MISS., INC.
706 OF PINEVILLE, LA., INC.
707 OF BUNKIE, LA., INC.
708 OF LITTLE ROCK, ARK., INC.
710 OF MONTICELLO, GA., INC.
715 OF PARKERSBURG, W. VA., INC.
717 OF TALLULAH, LA., INC.
719 OF PENNSYLVANIA, INC.
732 OF STUART, VA., INC.
733 OF BOONEVILLE, KY., INC.
744 OF OHIO, INC.
810 OF DELAWARE, INC.
844 OF NO. PENNSYLVANIA, INC.
882 OF WISCONSIN, INC.
886 OF ILLINOIS, INC.
887 OF INDIANA, INC.
888 OF KANSAS, INC.
890 OF NEW JERSEY, INC.
891 OF MASSACHUSETTS, INC.
892 OF MICHIGAN, INC.
893 OF MINNESOTA, INC.
894 OF MISSOURI, INC.
895 OF NEW YORK, INC.
897 OF OKLAHOMA, INC.
898 OF TEXAS, INC.
1420 OF CONNECTICUT, INC.
1424 OF IOWA, INC.
1425 OF NEBRASKA, INC.
1665 OF D. C., INC.
1881 OF NEW HAMPSHIRE, INC.
2020 OF RHODE ISLAND, INC.
9100 FAMILY DOLLAR SERVICES, INC.
9200 FAMILY DOLLAR OPERATIONS, INC.
9300 FAMILY DOLLAR TRUCKING, INC.
9900
9990 INC. (DELAWARE)
353 CORPORATIONS
</TABLE>
<TABLE>
<CAPTION>
FAMILY DOLLAR STORES, INC. STATEMENT RE COMPUTATIONS OF PER SHARE EARNINGS
AS PRESENTED FY 1995 FY 1994
PRIMARY FULLY DILUTED PRIMARY FULLY DILUTED
<S> <C> <C> <C> <C>
AVERAGE SHARES OUTSTANDING FOR THE YEAR ENDED 56,684,861 56,684,861 56,496,399 56,496,399
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $58,109,525 $58,109,525 $61,959,886 $61,959,886
NET INCOME $58,109,525 $58,109,525 $63,099,039 $63,099,039
EARNINGS PER SHARE:
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $1.03 $1.03 $1.10 $1.10
NET INCOME $1.03 $1.03 $1.12 $1.12
PRO FORMA DILUTION IMPACT OF COMMON STOCK EQUIVALENTS
ADDITIONAL WEIGHTED AVERAGE SHARES FROM ASSUMED EXERCISE
AT THE BEGINNING OF THE YEAR OF DILUTIVE STOCK
OPTIONS 415,663 873,018 348,548 348,548
WEIGHTED AVERAGE SHARES ASSUMED REPURCHASED FROM
ASSUMED PROCEEDS OF EXERCISES USING TREASURY STOCK
METHOD (AVERAGE MARKET PRICE FOR PRIMARY AND, IF
GREATER, ENDING MARKET PRICE FOR FULLY DILUTED) (356,177) (733,528) (216,841) (216,841)
NET PRO FORMA COMMON STOCK EQUIVALENT INCREMENTAL
SHARES 59,486 139,490 131,707 131,707
PERCENTAGE DILUTION FROM PRO FORMA COMMON
STOCK EQUIVALENT INCREMENTAL SHARES 0.10% 0.25% 0.23% 0.23%
TOTAL COMMON STOCK AND COMMON STOCK EQUIVALENTS 56,690,347 56,824,351 56,628,106 56,628,106
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $58,109,525 $58,109,525 $61,959,886 $61,959,886
NET INCOME $58,109,525 $58,109,525 $63,099,039 $63,099,039
PRO FORMA EARNINGS PER SHARE (INCLUDING DILUTIVE
COMMON STOCK EQUIVALENTS):
INCOME BEFORE CUMULATIVE EFFECT OF ACCOUNTING CHANGE $1.03 $1.02 $1.09 $1.09
NET INCOME $1.03 $1.02 $1.11 $1.11
<PAGE>
<CAPTION>
FY 1993
PRIMARY FULLY DILUTED
<C> <C>
56,249,774 56,249,774
$64,428,683 $64,428,683
$64,428,683 $64,428,683
$1.15 $1.15
$1.15 $1.15
1,019,990 1,019,990
(724,165) (720,770)
295,825 299,220
0.53% 0.53%
56,545,599 56,548,994
$64,428,683 $64,428,683
$64,428,683 $64,428,683
$1.14 $1.14
$1.14 $1.14
</TABLE>
MARKET PRICE AND DIVIDEND INFORMATION
Family Dollar's Common Stock is traded on the New York Stock
Exchange under the ticker symbol FDO. At November 1, 1995,
there were approximately 2,860 holders of record of the Common
Stock. The accompanying tables give the high and low sales
prices of the Common Stock and the dividends declared per share
for each quarter of fiscal 1995 and 1994.
<TABLE>
MARKET PRICES AND DIVIDENDS
<CAPTION>
1995 High Low Dividend
<S> <C> <C> <C>
First Quarter........... $12.63 $ 9.88 $.08-1/2
Second Quarter.......... 14.00 11.00 .10
Third Quarter........... 13.38 10.88 .10
Fourth Quarter.......... 19.75 11.63 .10
<CAPTION>
1994 High Low Dividend
<S> <C> <C> <C>
First Quarter........... $19.75 $15.13 $.07-1/2
Second Quarter.......... 17.25 15.38 .08-1/2
Third Quarter........... 18.38 14.00 .08-1/2
Fourth Quarter.......... 15.00 11.00 .08-1/2
</TABLE>
<PAGE>
<TABLE>
SUMMARY OF SELECTED FINANCIAL DATA
<CAPTION>
Years Ended August 31, 1995 1994 1993 1992 1991
<S> <C> <C> <C> <C> <C>
Net sales........................... $1,546,894,565 $1,428,440,427 $1,297,430,787 $1,158,703,861 $989,345,265
Cost of sales and operating expenses 1,452,519,040 1,328,323,366 1,194,510,816 1,069,764,555 925,619,376
Income before income taxes and
cumulative effect of accounting
change............................ 94,375,525 100,117,061 102,919,971 88,939,306 63,725,889
Income taxes........................ 36,266,000 38,157,175 38,491,288 33,267,370 23,484,031
Income before cumulative effect
of accounting change.............. 58,109,525 61,959,886 64,428,683 55,671,936 40,241,858
Cumulative effect of change in
method of accounting for income
taxes............................. - 1,139,153 - - -
Net income.......................... 58,109,525 63,099,039 64,428,683 55,671,936 40,241,858
Earnings per common share:
Income before cumulative effect
of accounting change.............. $1.03 $1.10 $1.15 $1.00 $0.72
Net income........................ $1.03 $1.12 $1.15 $1.00 $0.72
Dividends declared.................. $ 21,837,249 $ 18,656,163 $ 16,325,918 $ 13,988,516 $ 11,960,851
Dividends declared per common share. $.38 1/2 $0.33 $0.29 $0.25 $.21 1/2
Total assets........................ $ 636,233,767 $ 592,821,871 $ 537,445,610 $ 478,027,178 $399,27l,302
Working capital..................... $ 264,671,854 $ 230,234,774 $ 205,863,199 $ 170,288,208 $l36,207,278
Shareholders' equity................ $ 407,750,588 $ 370,172,275 $ 323,281,504 $ 271,772,441 $227,319,970
<PAGE>
<CAPTION>
1990 1989 1988 1987 1986
<C> <C> <C> <C> <C>
$874,395,095 $756,886,681 $669,493,241 $560,339,004 $487,734,841
826,764,773 721,799,222 625,314,311 513,556,172 430,195,740
47,630,322 35,087,459 44,178,930 46,782,832 57,539,101
l8,897,177 13,570,222 16,845,017 21,980,400 27,028,574
28,733,145 21,517,237 27,333,913 24,802,432 30,510,527
- - - - -
28,733,145 21,517,237 27,333,913 24,802,432 30,510,527
$0.52 $0.39 $0.49 $0.43 $0.53
$0.52 $0.39 $0.49 $0.43 $0.53
$ l0,8l9,248 $ 9,709,104 $ 8,620,700 $ 7,835,285 $ 6,652,787
$.19 1/2 $.17 1/2 $.15 1/2 $.13 1/2 $.11 1/2
$355,096,527 $324,012,452 $290,720,223 $242,005,537 $217,357,689
$l07,879,235 $ 87,228,450 $ 78,870,930 $ 83,876,967 $ 81,232,316
$l97,076,663 $l79,l35,552 $167,305,094 $159,571,825 $141,293,677
</TABLE>
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Net Sales
Net sales increased approximately 8.3% ($118,454,000) in fiscal
1995 compared with fiscal 1994, and approximately 10.1%
($131,010,000) in fiscal 1994 compared with fiscal 1993. The sales
increase in both fiscal 1995 and fiscal 1994 was primarily
attributable to the increase in the number of stores operated by the
Company.
Comparable store sales decreased approximately 0.7% in fiscal
1995 and increased approximately 0.5% in fiscal 1994, as compared
with the respective prior years. In response to competitive
pressures in the retail marketplace, the Company began a program of
price reductions on selected items in approximately 400 stores in
December 1993, and expanded the program to 1,000 stores in June
1994. In September and October 1994 the program was again expanded
to approximately 1,800 stores, with the number of stockkeeping units
with reduced prices increasing from approximately 500 to
approximately 2,500. A lesser number of price reductions have been
taken in the balance of stores in less competitive markets. The
Company generally is pleased with the impact of the price reduction
program on overall customer traffic and sales of hardlines
merchandise, particularly in the fourth quarter of fiscal 1995. In
fiscal 1995, the Company's lower price point apparel merchandise,
purchased as part of the price reduction program, did not generate
planned unit movement increases, contributing to sales declines on a
comparable store basis in the softlines departments which offset the
sales increases in hardlines.
The comparable store sales decrease of 0.7% in fiscal 1995 also
was attributable to reduced advertising. In connection with the
price reduction program and the Company's shift in its merchandise
strategy away from promotional pricing and toward everyday low
prices, the Company reduced the number of advertising circulars in
fiscal 1995 from 22 to 15, and eliminated all seven advertising
coupon booklets that were distributed in fiscal 1994.
During fiscal 1995, the Company opened 213 stores and closed 12
stores for a net addition of 201 stores, compared with the opening
of 202 stores and closing of 22 stores for a net addition of 180
stores during fiscal 1994. The Company currently plans to open
approximately 225 stores and close approximately 25 stores for a net
addition of 200 stores during fiscal 1996. New store opening and
closing plans are continuously reviewed and are subject to change
depending on developments in the economy and other factors.
<PAGE>
Cost of Sales and Margin
Cost of sales increased approximately 12.0% ($110,882,000) in
fiscal 1995 compared with fiscal 1994, and approximately 12.5%
($102,413,000) in fiscal 1994 compared with fiscal 1993. These
increases primarily reflected the additional sales volume in each of
the years. Cost of sales, as a percentage of net sales, was 66.8%
in fiscal 1995, 64.6% in fiscal 1994, and 63.2% in fiscal 1993. The
increase in the cost of sales percentage for fiscal 1995 was due
primarily to the merchandise price reductions that were taken at the
beginning of the fiscal year as the Company expanded the price
reduction program. The reduced prices generated increased sales of
items in hardlines departments but had a negative impact on the
gross margin percentage. Additionally, the reduction in sales of
apparel, which generally carries a higher margin than hardlines
merchandise, as a percentage of net sales contributed to the
increase in the cost of sales percentage. The increase in the cost
of sales percentage for fiscal 1994 was due primarily to the
initiation of the price reduction program as the Company began the
shift toward an everyday low price strategy. Weakness in apparel
sales also contributed to the increase in the cost of sales
percentage for fiscal 1994.
The Company intends to mitigate the continuing impact of the
price reduction program on gross profit margins by increasing the
emphasis on higher margin promotional merchandise and by working
with vendors to reduce merchandise cost. Even with these efforts,
the Company expects the gross profit margin percentage to be lower
in fiscal 1996 than in fiscal 1995, particularly in the first half
of fiscal 1996 as the impact of the shift to everyday low pricing
becomes fully realized.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased
approximately 3.3% ($13,313,000) in fiscal 1995 compared with fiscal
1994, and approximately 8.4% ($31,400,000) in fiscal 1994 compared
with fiscal 1993. The increases in these expenses primarily were
attributable to additional costs arising from the continued growth
in the number of stores in operation. As a percentage of net sales,
selling, general and administrative expenses were 27.1% in fiscal
1995, 28.4% in fiscal 1994, and 28.9% in fiscal 1993. The decrease
in fiscal 1995 primarily was due to decreases in store labor costs,
corporate overhead expenses and advertising expense. In fiscal
1995, the Company reduced the number of advertising circulars from
22 to 15 and eliminated all 7 coupon booklets as part of the
Company's shift away from promotional pricing and toward everyday
low pricing. The percentage decreased in fiscal 1994 primarily due
to decreases in store operating costs and incentive compensation.
The Company incurred no incentive compensation expense in fiscal
1995 or fiscal 1994. In fiscal 1996, selling, general and
administrative expenses as a percentage of net sales will be
impacted by the Company's continued efforts to tightly control store
operating expenses. Advertising expense will increase as the
<PAGE>
Company plans to eliminate only one of the 15 circulars that were
distributed in fiscal 1995 and increase circular distribution to
cover the planned net addition of 200 stores. Distribution expenses
also will continue to increase as the Company handles additional
units of lower priced merchandise. Selling, general and
administrative expenses were net of interest income of $1,437,938 in
fiscal 1995, $87,603 in fiscal 1994, and $259,726 in fiscal 1993.
Income Taxes
Income taxes, prior to the effect of adopting Statement of
Financial Accounting Standards (SFAS) No. 109 (described in Note 5
to the Consolidated Financial Statements), decreased approximately
5.0% ($1,891,000) in fiscal 1995 compared with fiscal 1994, and
decreased approximately 0.9% ($334,000) in fiscal 1994 compared with
fiscal 1993. The decreases in fiscal 1995 and fiscal 1994 were
primarily due to the decreases in pre-tax earnings. The effective
tax rate prior to the adoption of SFAS No. 109 was 38.4% in fiscal
1995, 38.1% in fiscal 1994 and 37.4% in fiscal 1993. The increases
in the effective tax rate resulted primarily from changes in state
income tax apportionment rates in fiscal 1995 and a statutory
increase in the federal income tax rate in fiscal 1994.
Inflation and Other Matters
The Company is impacted by the effect of inflation on the cost
of its merchandise and on operating expenses. Due to the nature of
the Company's merchandise, sales levels generally have incorporated
an inflation factor which neither exceeds nor is significantly lower
than general inflation trends. The Company attempts to combat
inflation in the cost of its merchandise by shifting its source of
supply or by changing merchandise assortments. The Company's
operating expenses also tend to rise with general inflation.
Specific items that may have a future impact on the Company's sales
and operating costs include possible legislated minimum wage
increases and other legislative initiatives to reduce spending on
programs such as Medicare and aid to low income families.
<PAGE>
Liquidity and Capital Resources
The Company has consistently maintained a strong position of
liquidity and financial strength. Cash provided from operating
activities during 1995 was $57.8 million as compared to $48.8
million in 1994 and $46.8 million in 1993. These amounts, which
have enabled the Company to fund its regular operating needs,
capital expense program and cash dividend payments, are its primary
sources of liquidity. In addition, the Company maintains
$100,000,000 of unsecured bank lines of credit for short-term
financing and periodically utilizes short-term borrowings to meet
the cash needs of its expansion program and seasonal inventory
increases. The majority of the increase in inventories during
fiscal 1995 was due to the required inventory investment for 201 net
additional stores. There were no long-term borrowings during fiscal
1995 or fiscal 1994.
The decrease in capital expenditures to $27.7 million in fiscal
1995 from $42.6 million in fiscal 1994 was due primarily to
expenditures incurred in fiscal 1994 for construction of the new
full service distribution center in West Memphis, Arkansas.
Currently planned capital expenditures for fiscal 1996 total
approximately $40 million, which is primarily for new store
expansion and for a planned expansion of the West Memphis
distribution center. Store expansion also will require additional
investment in merchandise inventories. The Company occupies most of
its stores under operating leases.
Capital spending plans, including store expansion, are
continuously reviewed and are subject to change depending on
developments in the economy and other factors. Cash flow from
current operations and short-term borrowings under the bank lines of
credit are expected to be sufficient to meet all foreseeable
liquidity and capital resource needs in both the short-term and the
long-term, including store expansion and other capital spending
programs. No long-term borrowings are now expected to be required
during fiscal 1996 or immediately subsequent periods.
<PAGE>
<TABLE>
Consolidated Statements of Income
FAMILY DOLLAR STORES, INC. AND SUBSIDIARIES
<CAPTION>
YEARS ENDED AUGUST 31, 1995 1994 1993
<S> <C> <C> <C>
Net sales...................................... $1,546,894,565 $1,428,440,427 $1,297,430,787
Costs and expenses:
Cost of sales.................................. 1,033,068,759 922,186,273 819,773,538
Selling, general and administrative
(Notes 6 and 7)................................ 419,450,281 406,137,093 374,737,278
1,452,519,040 1,328,323,366 1,194,510,816
Income before income taxes and cumulative
effect of accounting change.................... 94,375,525 100,117,061 102,919,971
Income taxes (Note 5)............................ 36,266,000 38,157,175 38,491,288
Income before cumulative effect of accounting
change......................................... 58,109,525 61,959,886 64,428,683
Cumulative effect of change in method of
accounting for income taxes (Note 5)........... - 1,139,153 -
Net income....................................... $ 58,109,525 $ 63,099,039 $ 64,428,683
Earnings per common share (Note 9):
Income before cumulative effect
of accounting change......................... $1.03 $1.10 $1.15
Cumulative effect of change in
method of accounting for income taxes........ - .02 -
Net income..................................... $1.03 $1.12 $1.15
Weighted average number of shares outstanding
during each year............................. 56,684,861 56,496,399 56,249,774
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
Report of Independent Accountants
To the Board of Directors and Shareholders
of Family Dollar Stores, Inc.
In our opinion, the accompanying consolidated balance sheets
and the related consolidated statements of income, of
shareholders' equity and of cash flows present fairly, in all
material respects, the financial position of Family Dollar
Stores, Inc. and its subsidiaries at August 31, 1995 and 1994,
and the results of their operations and their cash flows for
each of the three years in the period ended August 31, 1995, in
conformity with generally accepted accounting principles.
These financial statements are the responsibility of the
Company's management; our responsibility is to express an
opinion on these financial statements based on our audits. We
conducted our audits of these financial statements in
accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating
the overall financial statement presentation. We believe that
our audits provide a reasonable basis for the opinion expressed
above.
As discussed in Note 5 to the financial statements, the Company
changed its method of accounting for income taxes during 1994.
PRICE WATERHOUSE LLP
PRICE WATERHOUSE LLP
October 10, 1995
Charlotte, North Carolina
<PAGE>
<TABLE>
Consolidated Balance Sheets
FAMILY DOLLAR STORES, INC. AND SUBSIDIARIES
<CAPTION>
AUGUST 31, 1995 1994
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents.......................................... $ 8,852,631 $ 9,882,533
Merchandise inventories............................................ 443,445,448 403,570,733
Deferred income taxes (Note 5)..................................... 16,415,749 12,991,213
Income tax refund receivable (Note 5).............................. - 4,569,686
Prepayments and other current assets............................... 6,315,880 4,853,416
Total current assets............................................ 475,029,708 435,867,581
Property and equipment, net (Note 2)................................. 156,640,224 151,946,323
Other assets......................................................... 4,563,835 5,007,967
$636,233,767 $592,821,871
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable (Note 3)............................................. $ - $ 12,300,000
Accounts payable................................................... 156,381,205 149,920,114
Accrued liabilities (Note 4)....................................... 51,589,087 43,412,693
Income taxes payable (Note 5)...................................... 2,387,562 -
Total current liabilities....................................... 210,357,854 205,632,807
Deferred income taxes (Note 5)....................................... 18,125,325 17,016,789
Commitments and Contingencies (Note 7)
Shareholders' equity (Notes 8 and 9):
Preferred stock, $1 par; authorized and unissued 500,000 shares
Common stock, $.10 par; authorized 120,000,000 shares ............. 6,019,666 6,003,907
Capital in excess of par........................................... 15,774,431 14,484,153
Retained earnings.................................................. 397,305,759 361,033,483
419,099,856 381,521,543
Less common stock held in treasury, at cost........................ 11,349,268 11,349,268
407,750,588 370,172,275
$636,233,767 $592,821,871
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
Consolidated Statements of Shareholders' Equity
FAMILY DOLLAR STORES, INC. AND SUBSIDIARIES
<CAPTION>
Capital in
Common excess Retained Treasury
YEARS ENDED AUGUST 31, 1995, 1994 AND 1993 stock of par earnings stock
<S> <C> <C> <C> <C>
Balance, September 1, 1992
(59,491,004 shares common stock;
3,452,822 shares treasury stock)............... $5,949,100 $ 8,684,767 $268,487,842 $11,349,268
Net income for the year.......................... 64,428,683
Issuance of 313,410 common shares under employee
stock option plans, including tax benefits (Note 8) 31,341 3,374,957
Less dividends on common stock, $.29 per share (16,325,918)
Balance, August 31, 1993
(59,804,414 shares common stock;
3,452,822 shares treasury stock).............. 5,980,441 12,059,724 316,590,607 11,349,268
Net income for the year......................... 63,099,039
Issuance of 234,660 common shares under employee
stock option plans, including tax benefits (Note 8) 23,466 2,424,429
Less dividends on common stock, $.33 per share.. (18,656,163)
Balance, August 31, 1994
(60,039,074 shares common stock;
3,452,822 shares treasury stock).............. 6,003,907 14,484,153 361,033,483 11,349,268
Net income for the year......................... 58,109,525
Issuance of 157,590 common shares under employee
stock option plan, including tax benefits (Note 8) 15,759 1,290,278
Less dividends on common stock, $.385 per share.. (21,837,249)
Balance, August 31, 1995
(60,196,664 shares common stock;
3,452,822 shares treasury stock).............. $6,019,666 $15,774,431 $397,305,759 $11,349,268
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
Consolidated Statements of Cash Flows
FAMILY DOLLAR STORES, INC. AND SUBSIDIARIES
<CAPTION>
YEARS ENDED AUGUST 31, 1995 1994 1993
<S> <C> <C> <C>
Cash flows from operating activities:
Net income........................................................ $ 58,109,525 $ 63,099,039 $ 64,428,683
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization.................................. 22,185,435 19,463,032 17,167,836
Deferred income taxes.......................................... (2,316,000) 1,328,635 1,537,284
Cumulative effect of accounting change......................... - (1,139,153) -
Loss on disposition of property and equipment ................. 14,799 44,947 5,501
Changes in operating assets and liabilities:
Merchandise inventories...................................... (39,874,715) (24,215,768) (40,311,832)
Income tax refund receivable................................. 4,569,686 (4,569,686) -
Prepayments and other current assets......................... (1,462,464) 236,305 64,663
Other assets................................................. 444,132 (197,940) (2,346,728)
Accounts payable and accrued liabilities..................... 13,772,751 (3,874,769) 11,457,838
Income taxes payable......................................... 2,387,562 (587) (3,871,468)
Noncurrent income taxes payable.............................. - (1,344,053) (1,344,056)
57,830,711 48,830,002 46,787,721
Cash flows from investing activities:
Capital expenditures............................................. (27,695,509) (42,630,031) (32,537,037)
Proceeds from dispositions of property and equipment............. 801,374 1,323,373 2,037,412
(26,894,135) (41,306,658) (30,499,625)
Cash flows from financing activities:
Net change in short-term borrowings (Note 3)..................... (12,300,000) 12,300,000 -
Exercise of employee stock options, including tax benefits....... 1,306,037 2,447,895 3,406,298
Payment of dividends............................................. (20,972,515) (18,072,740) (15,741,863)
(31,966,478) (3,324,845) (12,335,565)
Net increase (decrease) in cash and cash equivalents................. (1,029,902) 4,198,499 3,952,531
Cash and cash equivalents at beginning of year....................... 9,882,533 5,684,034 1,731,503
Cash and cash equivalents at end of year............................. $ 8,852,631 $ 9,882,533 $ 5,684,034
Supplemental disclosures of cash flow information:
Cash paid during the year for:
Interest....................................................... $ 549,570 $ 380,784 $ 220,228
Income taxes................................................... 31,189,881 41,815,662 40,471,402
The accompanying notes are an integral part of the consolidated financial statements.
</TABLE>
<PAGE>
Notes to Consolidated Financial Statements
FAMILY DOLLAR STORES, INC. AND SUBSIDIARIES
YEARS ENDED AUGUST 31, 1995, 1994 AND 1993
1. Description of business and summary of significant
accounting policies:
Description of business:
The Company operates a chain of self-service retail discount
stores.
Principles of consolidation:
The consolidated financial statements include the accounts of
the Company and its subsidiaries, all of which are
wholly-owned. All significant intercompany balances and
transactions have been eliminated.
Cash equivalents:
The Company considers all highly liquid investments with a
maturity of three months or less to be cash equivalents.
Merchandise inventories:
Inventories are valued using retail prices less markon
percentages, and approximate the lower of first-in, first-out
(FIFO) cost or market.
Property and equipment and depreciation:
Property and equipment is stated at cost. Depreciation for
financial reporting purposes is being provided principally by
the straight-line method over the estimated useful lives of
the related assets, and by straight-line and accelerated
methods for income tax reporting purposes.
Pre-opening costs:
The Company charges pre-opening costs against operating
results when incurred.
Selling, general and administrative expenses:
Buying, warehousing and occupancy costs are included in
selling, general and administrative expenses.
<PAGE>
<TABLE>
<CAPTION>
2. Property and equipment:
AUGUST 3l,
1995 1994
<S> <C> <C>
Buildings........................ $ 62,930,713 $ 59,477,199
Furniture, fixtures and equipment 168,962,333 156,315,788
Transportation equipment......... 14,783,869 14,938,524
Leasehold improvements........... 28,376,593 23,481,364
275,053,508 254,212,875
Less accumulated depreciation
and amortization............. 127,773,462 111,558,480
147,280,046 142,654,395
Land............................. 9,360,178 9,291,928
$156,640,224 $151,946,323
</TABLE>
<PAGE>
3. Lines of credit and short-term borrowings:
The Company has two unsecured bank lines of credit for short-term
revolving borrowings of up to $50,000,000 each, or $100,000,000 of total
borrowing capacity. The lines of credit expire on February 28, 1996 and
February 13, 1996, respectively, and the Company expects that both lines
of credit will be renewed. Borrowings under these lines of credit are at
a variable interest rate equal to the lower of the bank's prime interest
rate minus one-half percent or a rate based on short-term market interest
rates. The Company may convert up to $50,000,000 of the line of credit
expiring February 28, 1996 into either a five, seven, or nine year term
loan, at the bank's variable prime rate.
Interest expense, average and maximum borrowings outstanding and interest
rates for each of the three years in the period ended August 31, 1995,
were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Interest expense, net
of capitalized interest
of $196,720 in 1994.. $ 481,886 $ 251,748 $ 220,228
Average borrowings
outstanding........ $ 5,828,000 $ 9,985,000 $ 5,296,000
Maximum month-end
outstanding........ $36,100,000 $43,670,000 $35,200,000
Interest rate at
year-end........... N/A 5.6% N/A
Daily weighted average
interest rates..... 6.3% 4.3% 4.4%
</TABLE>
4. Accrued liabilities:
<TABLE>
<CAPTION>
AUGUST 3l,
1995 1994
<S> <C> <C>
Payroll............................... $13,942,368 $11,043,394
Deferred business insurance premiums.. 21,359,234 17,598,985
Taxes other than income taxes......... 13,044,824 11,885,722
Other................................. 3,242,661 2,884,592
$51,589,087 $43,412,693
</TABLE>
<PAGE>
5. Income taxes:
Effective September 1, 1993, the Company adopted Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" ("SFAS 109").
As permitted by SFAS 109, the Company has elected not to restate the
financial statements of prior years. The cumulative effect as of September
1, 1993, of adopting SFAS 109 increased net income for the year ended August
31, 1994, by $1,139,153, or $.02 per share. Under SFAS 109, the liability
method is used in accounting for income taxes. Under this method, deferred
tax assets and liabilities are determined based on differences between
financial reporting and tax bases of assets and liabilities and are measured
using the enacted tax rates and laws that will be in effect when the
differences are expected to reverse. Prior to the adoption of SFAS 109, the
Company accounted for deferred income taxes using the deferred method.
Under this method deferred tax expense was based on items of income and
expense that were reported in different years in the financial statements
and tax returns and were measured at the tax rate in effect in the year the
difference originated.
SFAS 109 requires an asset to be recognized for the anticipated income tax
benefits arising from deductible temporary differences and net operating
loss carryforwards and a valuation allowance, if necessary, to be
established to reduce such assets to the amount which is more likely than
not to be realized. A valuation allowance has been established for a
portion of the benefits of state tax net operating losses and for a portion
of certain other state tax benefits because the Company currently believes
that it is more likely than not that these benefits will not be realized in
future years.
The components of the Company's deferred income tax liabilities and assets
as of August 31, 1995 and 1994, were as follows:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Deferred income tax liabilities:
Excess of book over tax valuation of
property and equipment............... $18,125,325 $17,016,789
Deferred income tax assets:
Excess of tax over book valuation
of inventories....................... $ 4,896,588 $ 3,981,592
Currently nondeductible accruals for:
Business insurance premiums.......... 9,321,724 7,408,292
Deferred incentive compensation...... 462,124 -
Vacation pay......................... 1,597,564 1,224,598
Closed store lease liabilities....... 337,269 337,881
State net operating losses............. 983,000 983,000
Other.................................. 317,480 555,850
Gross deferred income tax assets..... 17,915,749 14,491,213
Valuation allowance for deferred
income tax assets...................... (1,500,000) (1,500,000)
Net deferred income tax assets....... $16,415,749 $12,991,213
</TABLE>
<PAGE>
The provisions for income taxes in each of the three years in the period
ended August 31, 1995, were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Current:
Federal.................... $32,595,000 $30,800,327 $31,356,382
State...................... 5,987,000 6,028,213 5,597,622
38,582,000 36,828,540 36,954,004
Deferred:
Federal.................... (1,852,000) 1,120,535 1,216,278
State...................... (464,000) 208,100 321,006
(2,316,000) 1,328,635 1,537,284
$36,266,000 $38,157,175 $38,491,288
</TABLE>
The components of the deferred provision for income taxes for the year
ended August 31, 1993, computed under the deferred method, were as follows:
<TABLE>
<CAPTION>
1993
<S> <C>
Excess of tax over book depreciation........ $1,083,033
Excess of tax over book valuation of
inventory................................. 159,785
Deferred business insurance premiums
accrued but not currently deductible...... (152,768)
Vacation pay accrued but not currently
deductible................................ (91,343)
Deferred incentive compensation (Note 6).... 274,144
Closed store lease liabilities accrued
but not currently deductible.............. 259,902
Other....................................... 4,531
$1,537,284
</TABLE>
<PAGE>
The following table summarizes the components of income tax expense
in each of the three years in the period ended August 31, 1995:
<TABLE>
<CAPTION>
1995 1994 1993
% % %
Income tax of pre-tax Income tax of pre-tax Income tax of pre-tax
expense income expense income expense income
<S> <C> <C> <C> <C> <C> <C>
Computed "expected" Federal income tax $33,031,434 35.0 $35,040,971 35.0 $35,682,354 34.7
State income taxes, net of Federal
income tax benefit.................. 3,771,950 4.0 3,915,700 3.9 3,262,359 3.2
Other................................. (537,384) (0.6) (799,496) (0.8) (453,425) (0.5)
Actual income tax expense............. $36,266,000 38.4 $38,157,175 38.1 $38,491,288 37.4
Noncurrent income taxes payable represents the noncurrent portion of the additional estimated tax liability
arising from the change in accounting method for income tax purposes for insurance costs and accrued vacation pay.
</TABLE>
6. Employee benefit plans:
Incentive compensation plan:
The Company has an incentive profit-sharing plan whereby, at
the discretion of the Board of Directors, the Company may pay
certain employees and officers an aggregate amount not to
exceed 5% of the Company's consolidated income before income
taxes. Expenses under the profit-sharing plan were $0 in
fiscal 1995 and 1994, and $2,050,253 in fiscal 1993.
Compensation deferral plan:
The Company has a voluntary compensation deferral plan, under
Section 40l(k) of the Internal Revenue Code, available to
eligible employees. At the discretion of the Board of
Directors, the Company makes contributions to the plan which
are allocated to participants, and in which they become
vested, in accordance with formulas and schedules defined by
the plan. Company expenses for contributions to the plan
were $901,019 in fiscal 1995, $990,491 in fiscal 1994, and
$862,481 in fiscal 1993.
<PAGE>
7. Commitments and Contingencies:
Operating leases:
Except for its executive offices and primary distribution
centers, the Company generally conducts its operations from
leased facilities. Generally, store real estate leases are for
initial terms of from five to fifteen years with multiple
renewal options for additional five year periods. Certain
leases provide for contingent rental payments based upon a
percentage of store sales.
Rental expenses on all operating leases, both cancellable
and non-cancellable, for each of the three years in the period
ended August 31, 1995, were as follows:
<TABLE>
<CAPTION>
1995 1994 1993
<S> <C> <C> <C>
Minimum rentals,
net of minor
sublease rentals.. $59,826,236 $52,174,423 $44,734,458
Contingent rentals.. 929,241 1,050,453 1,250,513
$60,755,477 $53,224,876 $45,984,971
</TABLE>
Future minimum rental payments required under operating
leases that have initial or remaining non-cancellable lease
terms in excess of one year as of August 31, 1995, were as
follows:
<TABLE>
<CAPTION>
Years Ending August 31, Minimum Rental
<C> <C>
1996 $ 57,329,683
1997 48,717,492
1998 39,628,126
1999 26,329,982
2000 12,990,313
Thereafter 20,507,000
$205,502,596
</TABLE>
Contingencies:
During October 1995, the Company reached a final settlement
with the Internal Revenue Service (IRS) for assessments
resulting from examination of the Company's consolidated 1991
and 1992 federal income tax returns, and the Company incurred
no material adverse impact on its financial statements. The
IRS is currently examining the Company's consolidated 1993 and
1994 federal income tax returns but has not rendered a final
report of their findings.
<PAGE>
8. Employee stock option plan:
The Company's non-qualified stock option plan provides for the granting
of options to key employees to purchase shares of common stock at prices
not less than fair market value on the date of the grant. Options are
exercisable to the extent of 40% after the second anniversary of the
grant, an additional 30% annually on a cumulative basis, and expire five
years from the date of the grant. Options to purchase 357,835 shares of
common stock were exercisable at August 31, 1995.
<TABLE>
<CAPTION>
Number of
options Option price
outstanding per share
<S> <C> <C>
Common stock options, September 1, 1993.............. 1,120,510 $ 5.13-21.25
Granted............................................. 223,800 11.50-16.75
Exercised........................................... (234,660) 5.13-16.63
Cancelled........................................... (158,360)
Common stock options, August 31, 1994................ 951,290 5.13-21.25
Granted............................................. 422,850 10.25-18.50
Exercised........................................... (157,590) 5.13-17.25
Cancelled........................................... (101,590)
Common stock options, August 31, 1995................ 1,114,960 $ 5.88-21.25
At August 31, 1995, there were 571,150 shares available for option under the plan,
and 892,410 shares were available for option at August 3l, 1994.
</TABLE>
9. Earnings per common share:
Earnings per common share is based on the weighted average number of
shares of common stock outstanding during each year. Potential exercise
of outstanding stock options do not have a material dilutive effect on
earnings per common share.
<PAGE>
<TABLE>
10. Unaudited summaries of quarterly results:
<CAPTION>
First Second Third Fourth
Quarter Quarter Quarter Quarter
(In thousands, except per share data)
<S> <C> <C> <C> <C>
1995
Net sales........ $356,292 $420,927 $379,836 $389,839
Gross profit..... 127,351 132,468 131,259 122,747
Net income....... 15,586 17,040 16,405 9,078
Net income per
common share .. $.28 $.30 $.29 $.16
1994
Net sales........ $335,092 $398,768 $349,211 $345,369
Gross profit..... 125,948 136,592 131,554 112,160
Income before
cumulative
effect of
accounting
change......... 14,950 22,021 17,570 7,419
Net income....... 16,089 22,021 17,570 7,419
Earnings per
common share:
Income before
cumulative effect
of accounting
change........ $.27 $.39 $.31 $.13
Net income.... $.29 $.39 $.31 $.13
1993
Net sales........ $304,608 $356,461 $310,081 $326,281
Gross profit..... 114,745 125,728 119,465 117,719
Net income....... 13,787 20,789 17,455 12,398
Net income per
common share .. $.25 $.37 $.31 $.22
</TABLE>
<TABLE>
<CAPTION>
FAMILY DOLLAR STORES, INC. & SUBSIDIARIES 8/31/95
-----------------------------------------
CORP. NO. NAME ADDRESS CITY STATE ZIP F.E.I. NO.
--------- --------------------------- -------------- --------- ----- ----- ----------
<S> <C> <C> <C> <C> <C>
FAMILY DOLLAR STORES
1 OF SANDERSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1109922
2 OF NORTH CAROLINA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0693934
7 OF SANFORD, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0854677
8 OF WILMINGTON, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0752043
10 INC. OF S. C. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0766390
11 OF MARTINSVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0791244
12 OF ROCK HILL, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0774313
14 OF GAINESVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 58-1048442
15 OF GASTONIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0791813
22 OF ROANOKE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0799404
26 OF HARRISONBURG, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1098343
31 OF AIRPORT CROSSROADS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0481964
32 OF TRAVELERS REST S.C. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0484805
35 OF WINSTON-SALEM, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0891786
36 OF GEORGIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0754858
37 OF AUGUSTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 58-1020583
39 OF THOMASVILLE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0903183
40 OF MECKLENBURG COUNTY INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0903810
42 OF HIGH POINT, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0927281
43 OF HENRY COUNTY INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0905499
45 OF EASLEY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0511859
46 OF GAFFNEY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0514835
47 OF LAURENS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0516407
48 OF CHESTER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0934964
49 OF NEWBERRY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0516825
53 OF BUENA VISTA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0854189
60 OF WEST COLUMBIA, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0521348
62 OF OCEAN DRIVE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0522185
65 OF BENNETTSVILLE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0523895
66 OF JAMES ISLAND, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0950032
68 OF CUMBERLAND COUNTY, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0949450
69 OF SMITHFIELD, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0950033
73 OF UNION, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0524425
76 OF BRISTOL, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1193158
77 OF ABBEVILLE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0525224
78 OF GALAX, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0882766
79 INC. (MISSISSIPPI) P.O. BOX 1017 CHARLOTTE NC 28201-1017 64-0470226
80 OF MARION, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952811
81 OF SPARTANBURG, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952153
83 OF GREENWOOD, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952150
86 OF HURT, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0955749
88 OF CONWAY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0955750
89 OF PONTOTOC, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327478
90 OF COMMERCE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0963516
91 OF ANDERSON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0963457
93 OF ALBEMARLE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0964262
99 OF INMAN, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0986749
101 OF LANCASTER COUNTY, S.C.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0987295
102 OF CAMDEN, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0987294
103 OF ATHENS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0989677
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105 OF WINDER, GA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024571
107 OF TOCCOA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0990185
111 OF SENECA, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0862849
112 OF SUMTER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0990635
115 OF WOODRUFF, S.C. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0990636
116 OF ASHEVILLE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992565
117 OF CHATSWORTH, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 58-0978660
119 OF CHERAW, S.C. INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0996222
121 OF PELZER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0996223
124 OF BATESBURG, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1014267
125 OF DILLON, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0545233
126 OF RICHMOND, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992564
127 OF HARTSVILLE, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1007333
128 OF CHASE CITY, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1013307
130 OF GREENVILLE, S.C., INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1007385
131 OF ORANGEBURG, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1007387
132 OF FLORENCE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0471484
135 OF DARLINGTON, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1014266
136 OF WALTERBORO, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1014749
137 OF SOUTH BOSTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1013306
138 OF MULLINS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1013308
147 OF PICKENS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1019398
149 OF GREER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-0876986
152 OF ANDREWS, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024810
154 OF LAWRENCEVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1023884
156 OF LAKE CITY, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1025274
158 OF ELBERTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024553
159 OF YORK, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1026926
160 OF THOMSON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1024316
162 OF PENDLETON, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0550909
165 OF PERRY,GA.INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1124535
167 OF CHARLESTON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952148
168 OF GOOSE CREEK, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952149
170 OF MARTINEZ, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1033166
174 OF NORTH AUGUSTA, S.C. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1023083
175 OF EMPORIA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1044478
176 OF CHESAPEAKE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1042853
178 OF SUMMERVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1157531
179 OF LOUISA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1038749
183 OF SWAINSBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1054983
186 OF RADFORD, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1048961
187 OF MANNING, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1161760
189 OF HAMPTON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1141002
193 OF GEORGETOWN, SC. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0565302
194 OF AIKEN, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1056848
195 OF MCDONOUGH GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1057216
199 OF MADISON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1065440
200 OF MILLEDGEVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1058472
208 OF WINNSBORO, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068417
209 OF MONROE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068416
211 OF MONCKS CORNER, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068415
212 OF KINGSTREE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1068419
214 OF HARTWELL, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072523
215 OF DOUGLAS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072513
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216 OF EASTMAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072512
218 OF FITZGERALD, GA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072515
219 OF CORNELIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1010175
222 OF PORTSMOUTH, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-0984373
223 OF BLUE RIDGE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1097105
224 OF NEWTON COUNTY GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1109917
226 OF SYLVANIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-0959580
227 OF MACON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1118791
228 OF WARNER ROBINS,GA.,INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952152
229 OF CARROLLTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1119905
230 OF CARTERSVILLE,GA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1119906
231 OF ATLANTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1120343
234 OF CLINTON, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0526909
236 OF AMERICUS GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1127675
237 OF SMYRNA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1226226
240 OF WASHINGTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1161755
241 OF VIDALIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1134237
244 OF HENDERSON INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1138200
246 OF FORT VALLEY GA INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1129286
248 OF BARNWELL, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1145736
252 OF MT. PLEASANT, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0952151
255 OF DENMARK, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1153152
258 OF RIVERDALE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1153153
261 OF CLINTON, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1064359
262 OF BEAUFORT, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1162735
263 OF ROSSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1161763
265 OF CORDELE, GA., INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1165546
267 OF GRIFFIN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1165543
268 OF CHESTER, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1032440
270 OF JONESBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1168141
272 OF FORT MILL, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1169116
274 OF MARION, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1171732
276 OF CEDARTOWN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072514
277 OF BARNESVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1171725
278 OF HOPEWELL, VA. INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1173213
279 OF ALBANY, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1172385
282 OF PULASKI, VA., INC P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1175330
283 OF ROME, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1175344
285 OF SALEM, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1175329
286 OF OAK HILL, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1177991
287 OF SURFSIDE BEACH, S.C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1177990
289 OF DUBLIN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1177989
290 OF CALHOUN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1180596
297 OF SMITHFIELD, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1062596
299 OF ORANGE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1076698
302 OF COVINGTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1193159
305 OF BECKLEY, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0580827
313 OF JACKSON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1198043
315 OF SAVANNAH, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208417
316 OF CHRISTIANSBURG, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1198411
318 OF NEWNAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1073013
319 OF SIMPSONVILLE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1030443
321 OF PRINCETON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0583278
322 OF COCHRAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1030842
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324 OF THOMASTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1203988
325 OF WYTHEVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1080403
326 OF BEDFORD, VA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208169
327 OF LYNCHBURG, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1080407
329 OF CLIFTON FORGE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1081404
331 OF ADEL, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208235
332 OF MOULTRIE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208239
333 OF COLUMBUS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1208230
335 OF SUFFOLK, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1216327
336 OF FARMVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1216328
338 OF NORFOLK, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1212850
340 OF SUMMERVILLE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1263366
341 OF ROCKY MOUNT, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1091171
343 OF STAUNTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1092451
345 OF DANVILLE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1221527
346 OF SOUTH HILL, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1221487
348 OF CAMILLA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1222247
349 OF QUITMAN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1222249
350 OF DOUGLASVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1051998
351 OF BAXLEY, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1051996
357 OF TAZEWELL, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1239650
358 OF HAWKINSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1239375
360 OF SPRING LAKE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1240992
362 OF LAFAYETTE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1240352
363 OF MARIETTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1131260
364 OF MABLETON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1067993
365 OF HAZLEHURST, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1067994
371 OF BLUEFIELD, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0596897
376 OF DUBLIN, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1254668
379 OF WAYNESBORO, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1301548
380 OF HARRISVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1333358
381 OF HINESVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1270823
383 OF STATESBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327882
384 OF TIFTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1085175
385 OF CLAXTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1270821
389 OF DANVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0604584
394 OF OCEAN SPRINGS, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1278645
397 OF FOREST PARK, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1281082
405 OF SYLACAUGA, ALA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1234185
415 OF TARRANT, ALA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1234186
420 OF VALDOSTA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232663
421 OF ELLIJAY, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232660
422 OF CAIRO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232661
423 OF ROYSTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232659
424 OF CUTHBERT, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1232664
442 OF MONTEZUMA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1285497
443 OF ASHLAND, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1151354
444 OF HAMPTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1282880
446 OF SUMMERSVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0606794
448 OF MANCHESTER, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1285001
449 OF DOTHAN, ALA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1285002
453 OF DULUTH, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1101171
454 INC. KENTUCKY P.O. BOX 1017 CHARLOTTE NC 28201-1017 38-1875634
456 OF RUSSELL SPRINGS, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1293634
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460 OF WEST VIRGINIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992562
464 OF RAINELLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1296336
469 OF ELKVIEW, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0610938
470 OF LITHONIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1105736
476 OF ELKTON, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1113296
480 OF SPRINGFIELD, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1304661
481 OF VICTORIA, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1174498
482 OF TULLAHOMA, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1304568
483 OF WISE, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1171385
484 OF BEATTYVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1360046
485 OF MAN, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1304664
492 OF VILLA RICA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1306477
493 OF REIDSVILLE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1307066
495 OF ESCATAWPA, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1308467
496 OF HARRODSBURG, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0992945
497 OF COLUMBIA, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 57-0426310
498 OF FRANKFORT, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0994177
499 OF FAIRBURN, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1117372
500 OF BRUNSWICK, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1315108
502 OF LOGAN, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0614710
504 OF WRENS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1311420
505 OF PENNINGTON GAP, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1179890
506 OF LAWRENCEBURG, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1312236
507 OF GREENSBORO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1311609
508 OF ST. ALBANS, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0618158
509 OF HINTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0614711
513 OF CYNTHIANA, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1313384
517 OF NEWPORT NEWS, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1182090
518 OF ST. GEORGE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1313974
520 OF AMORY, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1313382
521 OF WESTMINSTER, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1145912
522 OF NINETY SIX, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1129271
523 OF TUPELO, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1315110
524 OF RICHLANDS, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1185784
526 OF GORDON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1117373
530 OF CUMBERLAND, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0997242
532 OF GLASGOW, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-0998465
535 OF ALABAMA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1319884
538 OF GRUNDY, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 54-1199397
539 OF WATER VALLEY, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1129602
540 OF OXFORD, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1129865
542 OF FRANKLIN, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1325016
545 OF DREW, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327479
546 OF LELAND, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327486
547 OF GREENVILLE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1327483
548 OF RIPLEY, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1332569
549 OF MARLINTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1332766
553 OF LOUISVILLE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1333005
558 OF CUMMING, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1136722
559 OF JACKSON, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337230
560 OF STANFORD, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1335589
563 OF PHILIPPI, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0621212
564 OF FOLKSTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1334690
565 OF STARKVILLE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1336091
566 OF QUITMAN, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1336088
<PAGE>
<S> <C> <C> <C> <C> <C>
570 OF NEW MARTINSVILLE,W.VA.,INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338091
571 OF JENA, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1339389
572 OF WESTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337988
573 OF ST. MARYS, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337987
574 OF MANCHESTER, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337181
577 OF SPENCER, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 55-0621230
578 OF KINGWOOD, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337985
579 OF HAZLEHURST, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1339558
580 OF ABERDEEN, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338003
581 OF LAVONIA, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1337229
582 OF RIPLEY, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338000
583 OF MT. WASHINGTON, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-1009284
584 OF NATCHEZ, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1338905
585 OR ST. MARYS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1339387
586 OF FAYETTE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1141805
587 OF STANTON, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 61-1010702
591 OF BOGALUSA, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1342397
595 OF WESTERNPORT, MD., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343528
599 OF ARKANSAS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 71-0404928
601 OF DEWITT, ARK., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343529
602 OF MCGEHEE, ARK., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343356
603 OF CROSSLANES, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1343531
605 OF INEZ, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1347247
606 OF LEITCHFIELD, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1345063
607 OF BAY ST. LOUIS, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1345204
608 OF CANTON, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1346025
609 OF MCKENZIE, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1347234
612 OF CUMBERLAND, MD., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1346665
613 OF HUNTINGDON, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1147033
614 OF FLORIDA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1147034
617 OF BISHOPVILLE, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1349049
618 OF CARTHAGE, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1347757
620 OF LAGRANGE, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1349048
629 OF DAWSON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1072522
632 OF HOLLY SPRINGS, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1353786
633 OF TRENTON, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355533
636 OF RICHMOND, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1360064
637 OF KENNESAW, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1065602
643 OF SALYERSVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1358576
644 OF MARION, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1358577
649 OF LAKE PROVIDENCE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1360667
651 OF CAMPBELLSVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1362565
652 OF RUSSELLVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1362567
655 OF NATCHITOCHES, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1363368
658 OF LEXINGTON, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1366205
669 OF MARYLAND, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1179942
670 OF VIDALIA, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373351
671 OF LOUISA, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1369714
672 OF ABBEVILLE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373359
680 OF GREENUP, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373358
683 OF SPARTA, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 62-1114317
685 OF IRVINE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373356
687 OF GLENVILLE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373354
688 OF FRANKLINTON, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1373353
691 OF HUNTINGTON, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375590
<PAGE>
<S> <C> <C> <C> <C> <C>
692 OF HURRICANE, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375591
694 OF WAYCROSS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375097
699 0F MEMPHIS, TENN., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1375593
701 OF VANCEBURG, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1376394
703 OF GREENWOOD, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1377739
704 OF BROOKHAVEN, MISS., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1377743
706 OF PINEVILLE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378199
707 OF BUNKIE, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378191
708 OF LITTLE ROCK, ARK., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378196
710 OF MONTICELLO, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1377738
715 OF PARKERSBURG, W. VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1378192
717 OF TALLULAH, LA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1379165
719 OF PENNSYLVANIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992563
732 OF STUART, VA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1382716
733 OF BOONEVILLE, KY., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1383058
744 OF OHIO, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991921
801 OF MAULDIN, S. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0959395
802 OF CONYERS, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1065751
809 OF COVINGTON, GA., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1051675
810 OF DELAWARE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1416308
844 OF NO. PENNSYLVANIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56=1426757
880 OF ARIZONA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355530
882 OF WISCONSIN, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1356720
884 OF CALIFORNIA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0993176
886 OF ILLINOIS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0993516
887 OF INDIANA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991922
888 OF KANSAS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992164
889 OF NEVADA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355536
890 OF NEW JERSEY, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1400170
891 OF MASSACHUSETTS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992166
892 OF MICHIGAN, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991920
893 OF MINNESOTA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1400173
894 OF MISSOURI, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0991923
895 OF NEW YORK, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992165
897 OF OKLAHOMA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0992157
898 OF TEXAS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1389401
899 OF WYOMING, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1355538
1420 OF CONNECTICUT, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587368
1423 OF COLORADO, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587711
1424 OF IOWA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587713
1425 OF NEBRASKA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587714
1426 OF SOUTH DAKOTA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1587710
1613 OF VERMONT, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1633089
1620 OF NEW MEXICO, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1633088
1665 OF D. C., INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1441925
1881 OF NEW HAMPSHIRE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1435306
1883 OF NORTH DAKOTA, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1435307
2019 OF MAINE, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1763454
2020 OF RHODE ISLAND, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1763455
9100 FAMILY DOLLAR SERVICES, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1744955
9200 FAMILY DOLLAR OPERATIONS, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1747881
9300 FAMILY DOLLAR TRUCKING, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1747883
9400 FAMILY DOLLAR MARKETING, INC. P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-1911976
9990 INC. (DELAWARE) P.O. BOX 1017 CHARLOTTE NC 28201-1017 56-0942963
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED FINANCIAL STATEMENTS OF FAMILY DOLLAR STORES, INC. AND
SUBSIDIARIES FOR THE FISCAL YEAR ENDED AUGUST 31, 1995, AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000034408
<NAME> FAMILY DOLLAR STORES
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> AUG-31-1995
<PERIOD-START> SEP-01-1994
<PERIOD-END> AUG-31-1995
<EXCHANGE-RATE> 1
<CASH> 8,852,631
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 443,445,448
<CURRENT-ASSETS> 475,029,708
<PP&E> 284,413,686
<DEPRECIATION> 127,773,462
<TOTAL-ASSETS> 636,233,767
<CURRENT-LIABILITIES> 210,357,854
<BONDS> 0
<COMMON> 6,019,666
0
0
<OTHER-SE> 401,730,922
<TOTAL-LIABILITY-AND-EQUITY> 636,233,767
<SALES> 1,546,894,565
<TOTAL-REVENUES> 1,546,894,565
<CGS> 1,033,068,759
<TOTAL-COSTS> 1,452,519,040
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 94,375,525
<INCOME-TAX> 36,266,000
<INCOME-CONTINUING> 58,109,525
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 58,109,525
<EPS-PRIMARY> 1.03
<EPS-DILUTED> 1.03
</TABLE>
