<PAGE>
As filed with the Securities And Exchange Commission on Arril 15, 1996
Registration No. ________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REGISTRATION STATEMENT ON
FORM S-8
UNDER
THE SECURITIES ACT OF 1933
BARRETT RESOURCES CORPORATION
-------------------------------------------------------------
(Exact name of registraint as specified in its charter)
Delaware 84-0832476
- ------------------------------------ --------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
1515 Arapahoe Street, Tower 3, Suite 1000
Denver, Colorado 80202
-----------------------------------------------------------------
(Address of principal executive offices, including zip code)
(303) 572-3900
------------------------------------------------------------
(Registrant's telephone number, including area code)
BARRETT RESOURCES CORPORATION
RETIREMENT SAVINGS PLAN
------------------------------
(Full titles of the plans)
Eugene A. Lang, Jr., Esquire
Barrett Resources Corporation
1515 Arapahoc Street, Tower 3, Suite 1000
Denver, Colorado 80202
(303) 572-3900
-------------------------------------------------------------
(Name, address and telephone number of agent for service)
Copy to:
Alan L. Talesnick, Esq.
Francis B. Barron, Esq.
Bearman Talesnick & Clowdus
Professional Corporation
1200 Seventeenth Street, Suite 2600
Denver, Colorado 80202
(303) 572-6500
CALCULATION OF REGISTRATION FEE
Pursuant to Rule 146(c) under the Securities Act of 1933, this Registration
Statement covers an indeterminate amount of interests to be offered or sold
pursuant to the employee benefit plan described herein.
<PAGE>
PART I
INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
EXPLANATORY NOTE: As permitted by the rules of the Securities And Exchange
Commission (the "Commission"), this Registration Statement omits the information
specified in Part I of Form S-8. The documents containing the information
specified in Part I will be delivered to the participants in the Plan as
required by Securities Act Rule 428(b). Such docurnents are not being filed as
part of this Registration Statement or as prospectuses or prospectus supplements
pursuant to Rule 424.
-2-
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
Item 3. Incorporation Of Documents By Reference.
- ------------------------------------------------
The documents listed in (a) through (d) below are incorporated by
reference in the Registration Statement. All documents subsequently filed by the
Company pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities
Exchange Act Of 1934, prior to the filing of a post-effective amendment which
indicates that all securities offered have been sold or which deregisters all
securities then remaining unsold, shall be deemed to be incorporated by
reference in the Registration Statement and to be part thereof from the date of
the filing of such documents.
(a) The Company's Annual Report on Form 10-K for the year ended
December 31, 1995.
(b) The Description Of Securities contained in the Company's
Registration Statement on Form 8-A filed with the Securities And Exchange
Commission on October 27, 1994.
Item 4. Description Of Securities.
- ----------------------------------
Not Applicable.
Item 5. Interest Of Named Experts And Counsel.
- ----------------------------------------------
Bearman Talesnick & Clowdus Professional Corporation, Denver, Colorado,
has acted as counsel for the Company in connection with this Registration
Statement. Attorney's employed by this law firm beneficially own approximately
21,000 shares of the Company's Common Stock.
Item 6. Indemnification Of Officers And Directors.
- --------------------------------------------------
The Delaware General Corporation Law provides for indemnification by a
corporation of costs incurred by directors, employees, and agents in connection
with an action, suit, or proceeding brought by reason of their position as a
director, employee, or agent. The person being indemnified must have acted in
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation.
In addition to the general indemnification section, Delaware law provides
flinher protection for directors under Section 102(b)(7) of the General
Corporation Law of Delaware. This section was enacted in June 1986 and allows a
Delaware corporation to include in its certificate of incorporation a provision
that eliminates and limits certain personal liability of a director for monetary
damages for certain breaches of the director's fiduciary duty of care, provided
that any such provision does not (in the words of the statute) do any of the
following:
"eliminate or limit the liability of a director (i) for any breach of the
director's duty of loyalty to the corporation or its stockholders, (ii) for
acts or omissions not in good faith or which involve intentional misconduct
or a knowing violation of law, (iii) under section 174 of this Title
[dealing with willful or negligent violation of tile statutory provision
-3-
<PAGE>
concerning dividends and stock purchases and redemptions], or (iv) for any
transaction from which the director derived an improper personal benefit.
No such provision shall eliminate or limit the liability of a director for
any act or omission occurring prior to the date when such provision becomes
effective. . . ."
With regard to employee benefit plans, the Delaware General Corporation
Law provides that a director's conduct for a purpose he reasonably believed to
be in the interest of the participants and beneficiaries of the Plan is conduct
satisfying the subject indemnity provision. A director's conduct for a purpose
that he did not reasonably believe to be in the interest of the participants in
or beneficiaries of the Plan shall be deemed as not satisfying the indemnity
provision.
The Board of Directors is empowered to make other indemnification as
authorized by the Certificate Of Incorporation, Bylaws or corporate resolution
so long as the indemnification is consistent with the Delaware General
Corporation Law. Under the Company's Bylaws, the Company is required to
indemnify its directors to the full extent permitted by the Delaware General
Corporation Law, common law and any other statutory provisions.
Item 7. Exemption From Registration Claimed.
- --------------------------------------------
Not Applicable.
Item 8. Exhibits.
- -----------------
4 Specimen Stock Certificate is incorporated by reference from the
Company's Registration Statement on Form S-8 dated March 17, 1995
(File No.33-90450).
10 Barrett Resources Corporation Retirement Savings Plan.
23(a) Consent of Arthur Andersen LLP.
23(b) Consent of Bearman Talesnick & Clowdus Professional Corporations.
The Company undertakes that the Company will submit or has submitted the
Plan and any amendments thereto to the Internal Revenue Service ("IRS") in a
timely manner and has made or will make all changes by the IRS in order to
qualify the Plan under ERISA.
Item 9. Undertakings.
- ---------------------
(a) The undersigned Company hereby undertakes the following:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement as follows:
(i) to include any Prospectus required by Section 10(a)(3) of the
Secutities Act Of 1933;
(ii) to reflect in the Prospectus any facts or events arising after
the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually
or in the aggregate, represent a fundamental change in the
information set forth in the Registration Statement; and
-4-
<PAGE>
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the Company
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act Of
1934 and are incorporated by reference to the Registration Statement;
2. That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
Registration Statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof; and
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.
(b) For purposes of determining any liability under the Securities Act Of 1933,
each filing of the Company's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act Of 1934 (and, where applicable, each filing
of an employee benefit plans annual report pursuant to Section 15(d) of the
Securities Exchange Act Of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new Registration Statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising out of the Securities
Act Of 1933 may be permitted to directors, officers and controlling persons of
the Company pursuant to the foregoing provisions, or otherwise, the Company has
been advised that in the opinion of the Securities And Exchange Commission such
indemnification is against public policy as expressed in the Securities Act Of
1933 and is, therefore, unenforceable. In the event that a claim for
indemnification against such liability (other than the payment by the Company of
expenses incurred or paid by a director, officer or controlling person of the
Company in the successful defense of any action, suit or proceeding) is asserted
by such director, officer or controlling person in connection with securities
being registered, the Company will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Securities Act Of 1933 and will be
governed by the final adjudication of such issue.
-5-
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act Of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Denver, State of Colorado, on the 10th day of April,
1996.
BARRETT RESOURCES CORPORATION
By: /s/ William J. Barrett
-------------------------------------------
William J. Barrett, Chief Executive Officer
Pursuant to the requirements of the Securities Act Of 1933, this
Registration Statement has been signed below by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ William J. Barrett Chief Executive Officer, April 10, 1996
- ----------------------------- Chairman Of The Board,
William J. Barrett and Director
President, April __, 1996
- ----------------------------- Chief Operating Officer,
Paul M. Rady and Director
/s/ A. Ralph Reed Executive Vice President, April 10, 1996
- ----------------------------- and Director
A. Ralph Reed
/s/ John F. Keller Executive Vice President, April 10, 1996
- ----------------------------- Chief Financial Officer,
John F. Keller Secretary, and Director
/s/ C. Robert Buford Director April 10, 1996
- -----------------------------
C. Robert Buford
/s/ Derrill Cody Director April 15, 1996
- -----------------------------
Derrill Cody
</TABLE>
-6-
<PAGE>
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
Director April __, 1996
- -----------------------------
James M. Fitzgibbons
Director April __, 1996
- -----------------------------
Hennie L.J.M. Gieskes
/s/ William W. Grant, III Director April 12, 1996
- -----------------------------
William W. Grant, III
/s/ James T. Rodgers Director April 12, 1996
- -----------------------------
James T. Rodgers
/s/ Philippe S.E. Schreiber Director April 14, 1996
- -----------------------------
Philippe S.E. Schreiber
/s/ Harry S. Welch Director April 10, 1996
- -----------------------------
Harry S. Welch
</TABLE>
The Plan. Pursuant to the requirements of the Securities Act Of 1933, the
--------
Plan has duly caused this Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized in the City of Denver, State of
Colorado, on April 10, 1996.
BARRETT RESOURCES CORPORATION
RETIREMENT SAVINGS PLAN
By: /s/ William J. Barrett
---------------------------------------------------
William J. Barrett, Chief Executive Officer of
Barrett Resources Corporation
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
REGISTRATION STATEMENT ON
FORM S-8
UNDER
THE SECURITIES ACT OF 1933
As Filed With
The Securities And Exchange Commission
On April 15, 1996
BARRETT RESOURCES CORPORATION
--------------------
EXHIBITS
--------------------
<PAGE>
Exhibits.
Exhibit No. Page
- ----------- ----
4 Specimen Stock Certificate is incorporated by reference from the
Company's Registration Statement on Form S-8 dated March 17, 1995
(File No.33-90450).
10 Barrett Resources Corporation Retirement Savings Plan.
23(a) Consent of Arthur Andersen LLP.
23(b) Consent of Bearman Talesnick & Clowdus Professional Corporation.
<PAGE>
Exhibit 10
----------
(Attached To And Made Part Of The
Registration Statement On Form S-8 Of
Barrett Resources Corporation
Filed April 15, 1996)
BARRETT RESOURCES CORPORATION
-----------------------------
RETIREMENT SAVINGS PLAN
-----------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
INTRODUCTION
<S> <C> <C> <C>
ARTICLE I FORMAT AND DEFINITIONS
Section 1.01 -- Format
Section 1.02 -- Definitions
ARTICLE II PARTICIPATION
Section 2.01 -- Active Participant
Section 2.02 -- Inactive Participant
Section 2.03 -- Cessation of Participation
ARTICLE III CONTRIBUTIONS
Section 3.01 -- Employer Contributions
Section 3.01A-- Rollover Contributions
Section 3.02 -- Forfeitures
Section 3.03 -- Allocation
Section 3.04 -- Contribution Limitation
Section 3.05 -- Excess Amounts
ARTICLE IV INVESTMENT OF CONTRIBUTIONS
Section 4.01 -- Investment of Contributions
Section 4.O1A-- Investment in Qualifying Employer Securities
Section 4.02 -- Purchase of Insurance
Section 4.03 -- Transfer of Ownership
Section 4.04 -- Termination of Insurance
ARTICLE V BENEFITS
Section 5.01 -- Retirement Benefits
Section 5.02 -- Death Benefits
Section 5.03 -- Vested Benefits
Section 5.04 -- When Benefits Start
Section 5.05 -- Withdrawal Privileges
Section 5.06 -- Loans to Participants
ARTICLE VI DISTRIBUTION OF BENEFITS
Section 6.01 -- Automatic Forms of Distribution
Section 6.02 -- Optional Forms of Distribution and Distribution Requirements
Section 6.03 -- Election Procedures
Section 6.04 -- Notice Requirements
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
ARTICLE VII TERMINATION OF PLAN
ARTICLE VIII ADMINISTRATION OF PLAN
Section 8.01 -- Administration
Section 8.02 -- Records
Section 8.03 -- Information Available
Section 8.04 -- Claim and Appeal Procedures
Section 8.05 -- Unclaimed Vested Account Procedure
Section 8.06 -- Delegation of Authority
ARTICLE IX GENERAL PROVISIONS
Section 9.01 -- Amendments
Section 9.02 -- Direct Rollovers
Section 9.03 -- Mergers and Direct Transfers
Section 9.04 -- Provisions Relating to the Insurer and Other Parties
Section 9.05 -- Employment Status
Section 9.06 -- Rights to Plan Assets
Section 9.07 -- Beneficiary
Section 9.08 -- Nonalienation of Benefits
Section 9.09 -- Construction
Section 9.10 -- Legal Actions
Section 9.11 -- Small Amounts
Section 9.12 -- Word Usage
Section 9.13 -- Transfers Between Plans
ARTICLE X TOP-HEAVY PLAN REQUIREMENTS
Section 10.01 -- Application
Section 10.02 -- Definitions
Section 10.03 -- Modification of Vesting Requirements
Section 10.04 -- Modification of Contributions
Section 10.05 -- Modification of Contribution Limitation
</TABLE>
PLAN EXECUTION
2
<PAGE>
INTRODUCTION
The Primary Employer previously established a savings plan on April 1, 1991.
The Primary Employer is of the opinion that the plan should be changed. It
believes that the best means to accomplish these changes is to completely
restate the plan's terms, provisions and conditions. The restatement, effective
April 1, 1996, is set forth in this document and is substituted in lieu of the
prior document.
The restated plan continues to be for the exclusive benefit of the employees
of the Employer. All persons covered under the plan on March 31, 1996. shall
continue to be covered under the restated plan with no loss of benefits.
It is intended that the plan, as restated, shall qualify as a profit sharing
plan under the Internal Revenue Code of 1986, including any later amendments to
the Code.
3
<PAGE>
ARTICLE I
FORMAT AND DEFINITIONS
SECTION 1.01--FORMAT.
Words and phrases defined in the DEFINITIONS SECTION of Article I shall have
that defined meaning when used in this Plan, unless the context clearly
indicates otherwise.
These words and phrases have an initial capital letter to aid in identifying
them as defined terms.
SECTION 1.02--DEFINITIONS.
ACCOUNT means, for a Participant, the sum of the cash value of any Insurance
Policy for him plus his share of the Investment Fund. Separate accounting
records are kept for those parts of his Account that result from:
a) Elective Deferral Contributions.
b) Matching Contributions.
c) Other Employer Contributions.
d) Rollover Contributions.
If the Participant's Vesting Percentage is less than 100% as to any of the
Employer Contributions, a separate accounting record will be kept for any
part of his Account resulting from such Employer Contributions and, if there
has been a prior Forfeiture Date, from such Contributions made before a
prior Forfeiture Date.
A Participant's Account shall be reduced by any distribution of his Vested
Account and by any Forfeitures. A Participant's Account will participate in
the earnings credited, expenses charged and any appreciation or depreciation
of the Investment Fund. His Account is subject to any minimum guarantees
applicable under the Group Contract or other investment arrangement
ACTIVE PARTICIPANT means an Eligible Employee who is actively participating
in the Plan according to the provisions in the ACTIVE PARTICIPANT SECTION of
Article II.
AFFILIATED SERVICE GROUP means any group of corporations, partnerships or
other organizations of which the Employer is a part and which is affiliated
within the meaning of Code Section 414(m) and regulations thereunder. Such a
group includes at least two organizations one of which is either a service
organization (that is, an organization the principal business of which is
performing services), or an organization the principal business of which is
performing management functions on a regular and continuing basis. Such
service is of a type historically performed by employees. In the case of a
management organization, the Affiliated Service Group shall include
organizations related, within the meaning of Code Section 144(a)(3), to
either the management organization or the organization for which it performs
management functions. The term Controlled Group, as it is used in this Plan,
shall include the term Affiliated Service Group.
4
<PAGE>
ANNUAL COMPENSATION means, on any given date, the Employee's Compensation for
the latest Compensation Year ending on or before the given date.
ANNUITY STARTING DATE means, for a Participant, the first day of the first
period for which an amount is payable as an annuity or any other form.
BENEFICIARY means the person or persons named by a Participant to receive any
benefits under this Plan upon the Participant's death. See the BENEFICIARY
SECTION of Article IX.
CLAIMANT means any person who has made a claim for benefits under this Plan. See
the CLAIM AND APPEAL PROCEDURES SECTION of Article VIII.
CODE means the Internal Revenue Code of 1986, as amended.
COMPENSATION means, except as modified in this definition, the total earnings
paid or made available to an Employee by the Employer during any specified
period.
"Earnings" in this definition means Compensation as defined in the CONTRIBUTION
LIMITATION SECTION of Article III.
Compensation shall also include elective contributions. Elective contributions
are amounts excludable from the Employee's gross income under Code Sections 125,
402(e)(3), 402(h) or 403(b), and contributed by the Employer, at the Employee's
election, to a Code Section 401(k) arrangement, a simplified employee pension,
cafeteria plan or tax-sheltered annuity. Elective contributions also include
Compensation deferred under a Code Section 457 plan maintained by the Employer
and Employee contributions "picked up" by a governmental entity and, pursuant to
Code Section 414(h)(2), treated as Employer contributions.
For purposes of the EXCESS AMOUNTS SECTION of Article III, the Employer may
elect to use an alternative nondiscriminatory definition of Compensation in
accordance with the regulations under Code Section 414(s).
For purposes of determining the amount of Elective Deferral Contributions,
Compensation shall exclude reimbursements or other expense allowances, fringe
benefits (cash and noncash), moving expenses, deferred compensation and welfare
benefits.
Compensation shall exclude the following:
bonuses
commissions
Compensation shall exclude earnings paid before the Employee's Entry Date.
5
<PAGE>
For Plan Years beginning after December 3l, 1988, and before January 1, 1994,
the annual Compensation of each Participant taken into account for determining
all benefits provided under the Plan for any year shall not exceed $200,000. For
Plan Years beginning on or after January 1, 1994, the annual Compensation of
each Participant taken into account for determining all benefits provided under
the Plan for any year shall not exceed $150,000.
The $200,000 limit shall be adjusted by the Secretary at the same time and in
the same manner as under Code Section 415(d). The $150,000 limit shall be
adjusted by the Commissioner for increases in the cost of living in accordance
with Code Section 401(a)(17)(B). The cost of living adjustment in effect for a
calendar year applies to any period, not exceeding 12 months, over which pay is
determined (determination period) beginning in such calendar year. If a
determination period consists of fewer than 12 months, the annual compensation
limit will be multiplied by a fraction, the numerator of which is the number of
months in the determination period, and the denominator of which is 12.
In determining the Compensation of a Participant for purposes of the annual
compensation limit, the rules of Code Section 414(q)(6) shall apply, except that
in applying such rules, the term "family" shall include only the spouse of the
Participant and any lineal descendants of the Participant who have not attained
age 19 before the close of the year. If, as a result of the application of such
rules the adjusted annual compensation limit is exceeded, then (except for
purposes of determining the portion of Compensation up to the integration
level if this Plan provides for permitted disparity) the limitation shall be
prorated among the affected individuals in proportion to each such individual's
Compensation as determined under this definition prior to the application of
this limitation.
If Compensation for any prior determination period is taken into account in
determining a Participant's benefits accruing in the current Plan Year, the
Compensation for that prior determination period is subject to the annual
compensation limit in effect for that prior determination period. For this
purpose, for determination periods beginning before the first day of the first
Plan Year beginning on or after January 1, 1989, which are used to determine
benefits in Plan Years beginning after December 31, 1988 and before January
1, 1994, the annual compensation limit is $200,000. For this purpose, for
determination periods beginning before the first day of the first Plan Year
beginning on or after January 1, 1994, which are used to determine benefits in
Plan Years beginning on or after January 1, 1994, the annual compensation limit
is $150,000.
Compensation means, for an Employee who is a Leased Employee, the Employee's
Compensation for the services he performs for the Employer, determined in the
same manner as the Compensation of Employees who are not Leased Employees,
regardless of whether such Compensation would be received directly from the
Employer or from the leasing organization.
COMPENSATION YEAR means each one-year period ending on the last day of the Plan
Year, including corresponding periods before April 1, 1991.
CONTINGENT ANNUITANT means an individual named by the Participant to receive a
lifetime benefit after the Participant's death in accordance with a survivorship
life annuity.
6
<PAGE>
CONTRIBUTIONS means
Elective Deferral Contributions
Matching Contributions
Discretionary Contributions
Rollover Contributions
as set out in Article III, unless the context clearly indicates otherwise.
CONTROLLED GROUP means any group of corporations, trades or businesses of which
the Employer is a part that are under common control. A Controlled Group
includes any group of corporations, trades or businesses, whether or not
incorporated, which is either a parent-subsidiary group, a brother-sister group,
or a combined group within the meaning of Code Section 414(b). Code Section
414(c) and regulations thereunder and, for purposes of determining contribution
limitations under the CONTRIBUTION LIMITATION SECTION of Article III, as
modified by Code Section 415(h) and, for the purpose of identifying Leased
Employees, as modified by Code Section 144(a)(3). The term Controlled Group,
as it is used in this Plan, shall include the term Affiliated Service Group and
any other employer required to be aggregated with the Employer under Code
Section 414(0) and the regulations thereunder.
DIRECT ROLLOVER means a payment by the Plan to the Eligible Retirement Plan
specified by the Distributee.
DISCRETIONARY CONTRIBUTIONS means discretionary contributions made by the
Employer to fund this Plan. See the EMPLOYER CONTRIBUTIONS SECTION of
Article III.
DISTRIBUTEE means 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.
EARLY RETIREMENT DATE means the first day of any month before a Participant's
Normal Retirement Date which the Participant selects for the start of his
retirement benefit. This day shall be on or after the date on which he ceases to
be an Employee and the date he meets the following requirement(s):
a) He has attained age 55.
b) He has completed 6 years of Vesting Service.
ELECTIVE DEFERRAL CONTRIBUTIONS means Contributions made by the Employer to fund
this Plan in accordance with a qualified cash or deferred arrangement as
described in Code Section 401(k). See the EMPLOYER CONTRIBUTIONS SECTION of
Article III.
ELIGIBILITY BREAK IN SERVICE means an Eligibility Computation Period in which an
Employee is credited with 500 or fewer Hours-of-Service. An Employee incurs an
Eligibility Break in Service on the last day of an Eligibility Computation
Period in which he has an Eligibility Break in Service.
7
<PAGE>
ELIGIBILITY COMPUTATION PERIOD means a 12-consecutive month period. The first
Eligibility Computation Period begins on an Employee's Employment Commencement
Date. Later Eligibility Computation Periods shall be 12-consecutive month
periods ending on the last day of each Plan Year that begins after his
Employment Commencement Date.
To determine an Eligibility Computation Period after an Eligibility Break in
Service, the Plan shall use the 12-consecutive month period beginning on an
Employee's Reemployment Commencement Date as if his Reemployment Commencement
Date were his Employment Commencement Date.
ELIGIBILITY SERVICE means one year of service for each Eligibility Computation
Period that has ended and in which an Employee is credited with at least 1,000
Hours-of-Service.
However, Eligibility Service is modified as follows:
Predecessor Employer service included:
An Employee's service with a Predecessor Employer shall be included as
service with the Employer. If this Plan is not a continuation of a plan of
that Predecessor Employer, an Employee's service with that Predecessor
Employer shall be counted only if service continued with the Employer
without interruption. This service excludes service performed while a
proprietor or partner.
Period of Military Duty included:
A Period of Military Duty shall be included as service with the Employer to
the extent it has not already been credited. For purposes of crediting
Hours-of-Service during the Period of Military Duty, an Hour-of-Service
shall be credited (without regard to the 501 Hours-of-Service limitation)
for each hour an Employee would normally have been scheduled to work for the
Employer during such period.
Controlled Group service included:
An Employee's service with a member firm or a Controlled Group while both
that firm and the Employer were members of the Controlled Group shall be
included as service with the Employer.
ELIGIBLE EMPLOYEE means any Employee of the Employer.
ELIGIBLE RETIREMENT PLAN means an individual retirement account described in
Code Section 408(a), an individual retirement annuity described in Code Section
408(b), an annuity plan described in Code Section 403(a) or a qualified trust
described in Code Section 401(a), that accepts the Distributee's Eligible
Rollover Distribution.
However, in the case of an Eligible Rollover Distribution to the surviving
spouse, an Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.
ELIGIBLE ROLLOVER DISTRIBUTION means any distribution of all or any portion of
the balance to the credit of the Distributee, except that an Eligible Rollover
Distribution does not include:
a) 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
8
<PAGE>
Beneficiary, or for a specified period of ten years or more.
b) Any distribution to the extent such distribution is required under Code
Section 401(a)(9).
c) The portion of any distribution that is not includible in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
EMPLOYEE means an individual who is employed by the Employer or any other
employer required to be aggregated with the Employer under Code Sections 414(b),
(c), (m) or (o). A Controlled Group member is required to be aggregated with the
Employer.
The term Employee shall also include any Leased Employee deemed to be an
employee of any employer described in the preceding paragraph as provided in
Code Sections 414(n) or 414(o).
EMPLOYER means the Primary Employer. This will also include any successor
corporation or firm of the Employer which shall, by written agreement, assume
the obligations of this Plan or any predecessor corporation or firm of the
Employer (absorbed by the Employer, or of which the Employer was once a part)
which became a predecessor because of a change of name, merger, purchase of
stock or purchase of assets and which maintained this Plan.
EMPLOYER CONTRIBUTIONS means
Elective Deferral Contributions
Matching Contributions
Discretionary Contributions
as set out in Articte III, unless the context clearly indicates otherwise.
EMPLOYMENT COMMENCEMENT DATE means the date an Employee first performs an
Hour-of-Service.
ENTRY DATE means the date an Employee first enters the Plan as an Active
Participant. See the ACTIVE PARTICIPANT SECTION of Article II.
FAMILY MEMBER means an individual described in Code Section 414(q)(6)(B).
FISCAL YEAR means the Primary Employer's taxable year. The last day of the
Fiscal Year is December 31.
FORFEITURE means the part, if any, of a Participant's Account that is forfeited.
See the FORFEITURES SECTION of Article III.
FORFEITURE DATE means, as to a Participant, the last day of five consecutive
one-year Periods of Severance.
This is the date on which the Participant's Nonvested Account will be forfeited
unless an earlier forfeiture occurs as provided in the FORFEITURES SECTION of
Article III.
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GROUP CONTRACT means the group annuity contract or contracts into which the
Trustee enters with the Insurer for the investment of Contributions and the
payment of benefits under this Plan. The term Group Contract as it is used in
this Plan is deemed to include the plural unless the context clearly indicates
otherwise.
HIGHLY COMPENSATED EMPLOYEE means a highly compensated active Employee or a
highly compensated former Employee.
A highly compensated active Employee means any Employee who performs service for
the Employer during the determination year and who, during the look-back year:
a) received compensation from the Employer in excess of $75,000 (as
adjusted pursuant to Code Section 415(d));
b) received compensation from the Employer in excess of $50,000 (as
adjusted pursuant to Code Section 415(d)) and was a member of the
top-paid group for such year; or
c) was an officer of the Employer and received compensation during such
year that is greater than 50 percent of the dollar limitation in effect
under Code Section 415(b)(1)(A).
The term Highly Compensated Employee also means:
d) Employees who are both described in the preceding sentence if the term
"determination year" is substituted for the term "look-back year" and
the Employee is one of the 100 Employees who received the most
compensation from the Employer during the determination year; and
e) Employees who are 5 percent owners at any time during the look-back year
or determination year.
If no officer has satisfied the compensation requirement of (c) above during
either a determination year or look-back year, the highest paid officer for such
year shall be treated as a Highly Compensated Employee.
For this purpose, the determination year shall be the Plan Year. The look-back
year shall be the twelve-month period immediately preceding the determination
year.
A highly compensated former Employee means any Employee who separated from
service (or was deemed to have separated) prior to the determination year,
performs no service for the Employer during the determination year, and was a
highly compensated active Employee for either the separation year or any
determination year ending on or after the Employee's 55th birthday.
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If an Employee is, during a determination year or look-back year, a family
member of either a 5 percent owner who is an active or former Employee or a
Highly Compensated Employee who is one of the 10 most highly compensated
Employees ranked on the basis of compensation paid by the Employer during such
year, then the family member and the 5 percent owner or top-ten highly
compensated Employee shall be aggregated. In such case, the family member and 5
percent owner or top-ten highly compensated Employee shall be treated as a
single Employee receiving compensation and Plan contributions or benefits equal
to the sum of such compensation and contributions or benefits of the family
member and 5 percent owner or top-ten highly compensated Employee. For purposes
of this definition, family member includes the spouse, lineal ascendants and
descendants of the Employee or former Employee and the spouses of such lineal
ascendants and descendants.
The determination of who is a Highly Compensated Employee, including the
determinations of the number and identity of Employees in the top-paid group,
the top 100 Employees, the number of Employees treated as officers and the
compensation that is considered, will be made in accordance with Code
Section 414(q) and the regulations thereunder.
HOUR-OF-SERVICE means, for the elapsed time method of crediting service in this
Plan, each hour for which an Employee is paid, or entitled to payment, for
performing duties for the Employer. Hour-of-Service means, for the hours method
of crediting service in this Plan, the following:
a) Each hour for which an Employee is paid, or entitled to payment, for
performing duties for the Employer during the applicable computation
period.
b) Each hour for which an Employee is paid, or entitled to payment, by the
Employer because of a period of time in which no duties are performed
(irrespective of whether the employment relationship has terminated) due
to vacation, holiday, illness, incapacity (including disability),
layoff, jury duty, military duty or leave of absence. Notwithstanding
the preceding provisions of this subparagraph (b), no credit will be
given to the Employee
1) for more than 501 Hours-of-Service under this subparagraph (b)
because of any single continuous period in which the Employee
performs no duties (whether or not such period occurs in a single
computation period); or
2) for an Hour-of-Service for which the Employee is directly or
indirectly paid, or entitled to payment, because of a period in
which no duties are performed if such payment is made or due under a
plan maintained solely for the purpose of complying with applicable
worker's or workmen's compensation, or unemployment compensation or
disability insurance laws; or
3) for an Hour-of-Service for a payment which solely reimburses the
Employee for medical or medically related expenses incurred by him.
For purposes of this subparagraph (b), a payment shall be deemed to be
made by, or due from the Employer, regardless of whether such payment is
made by, or due from the Employer, directly or indirectly through, among
others, a trust fund or insurer, to which the Employer contributes or
pays premiums and regardless of whether contributions made or due to the
trust fund, insurer or other entity are for the benefit of particular
employees or are on behalf of a group of employees in the aggregate.
11
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c) Each hour for which back pay, irrespective of mitigation of damages, is
either awarded or agreed to by the Employer. The same Hours-of-Service
shall not be credited under both subparagraph (a) or subparagraph (b)
above (as the case may be) and under this subparagraph (c). Crediting of
Hours-of-Service for back pay awarded or agreed to with respect to
periods described in subparagraph (b) above will be subject to the
limitations set forth in that subparagraph.
The crediting of Hours-of-Service above shall be applied under the rules of
paragraphs (b) and (c) of the Department of Labor Regulation 2530.200b-2
(including any interpretations or opinions implementing said rules); which
rules, by this reference, are specifically incorporated in full within this
Plan. The reference to paragraph (b) applies to the special rule for determining
hours of service for reasons other than the performance of duties such as
payments calculated (or not calculated) on the basis of units of time and the
rule against double credit. The reference to paragraph (c) applies to the
crediting of hours of service to computation periods.
Hours-of-Service shall be credited for employment with any other employer
required to be aggregated with the Employer under Code Sections 414(b),(c),(m)
or (o) and the regulations thereunder for purposes of eligibility and vesting.
Hours-of-Service shall also be credited for any individual who is considered an
employee for purposes of this Plan pursuant to Code Section 414(n) or Code
Section 414(o) and the regulations thereunder.
Solely for purposes of determining whether a one-year break in service has
occurred for eligibility or vesting purposes, during a Parental Absence an
Employee shall be credited with the Hours-of-Service which otherwise would
normally have been credited to the Employee but for such absence, or in any case
in which such hours cannot be determined, eight Hours-of-Service per day of such
absence. The Hours-of-Service credited under this paragraph shall be credited
in the computation period in which the absence begins if the crediting is
necessary to prevent a break in service in that period; or in all other cases,
in the following computation period.
INACTIVE PARTICIPANT means a former Active Participant who has an Account. See
the INACTIVE PARTICIPANT SECTION of Article II.
INSURANCE POLICY means, for a Participant, the life insurance policy or policies
on his life issued by the Insurer as provided in Article IV. The term Insurance
Policy as it is used in this Plan is deemed to include the plural unless the
context clearly indicates otherwise.
INSURER means Principal Mutual Life Insurance Company and any other insurance
company or companies named by the Trustee or Primary Employer.
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INVESTMENT FUND means the total assets, excluding the cash values of any
Insurance Policy, held for the purpose of providing benefits for Participants.
These funds result from Contributions made under the Plan.
INVESTMENT MANAGER means any fiduciary (other than a trustee or Named Fiduciary)
a) who has the power to manage, acquire, or dispose of any assets of the
Plan; and
b) who (1) is registered as an investment adviser under the Investment
Advisers Act of 1940, or (2) is a bank, as defined in the Investment
Advisers Act of 1940, or (3) is an insurance company qualified to
perform services described in subparagraph (a) above under the laws of
more than one state; and
c) who has acknowledged in writing being a fiduciary with respect to the
Plan.
LATE RETIREMENT DATE means the first day of any month which is after a
Participant's Normal Retirement Date and on which retirement benefits begin. If
a Participant continues to work for the Employer after his Normal Retirement
Date, his Late Retirement Date shall be the earliest first day of the month on
or after he ceases to be an Employee. An earlier or a later Retirement Date may
apply if the Participant so elects. An earlier Retirement Date may apply if the
Participant is age 70 1/2. See the WHEN BENEFITS START SECTION of Article V.
LEASED EMPLOYEE means any person (other than an employee of the recipient) who
pursuant to an agreement between the recipient and any other person ("leasing
organization") has performed services for the recipient (or for the recipient
and related persons determined in accordance with Code Section 414(n)(6)) on a
substantially full time basis for a period of at least one year, and such
services are of a type historically performed by employees in the business field
of the recipient employer. Contributions or benefits provided a Leased Employee
by the leasing organization which are attributable to service performed for the
recipient employer shall be treated as provided by the recipient employer.
A Leased Employee shall not be considered an employee of the recipient if:
a) such employee is covered by a money purchase pension plan providing (1)
a nonintegrated employer contribution rate of at least 10 percent of
compensation, as defined in Code Section 415(c)(3), but including
amounts contributed pursuant to a salary reduction agreement which are
excludable from the employee's gross income under Code Sections 125,
402(e)(3), 402(h) or 403(b), (2) immediate participation, and (3) full
and immediate vesting and
b) Leased Employees do not constitute more than 20 percent of the
recipient's nonhighly compensated workforce.
LOAN ADMINISTRATOR means the person or positions authorized to administer the
Participant loan program.
The Loan Administrator is ROBERT W. HOWARD, SENIOR VP TREASURER.
MATCHING CONTRIBUTIONS means matching contributions made by the Employer to fund
this Plan. See the EMPLOYER CONTRIBUTIONS SECTION of Article III.
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MONTHLY DATE means each Yearly Date and the same day of each following month
during the Plan Year beginning on such Yearly Date.
NAMED FIDUCIARY means the person or persons who have authority to control and
manage the operation and administration of the Plan.
The Named Fiduciary is the Employer.
NONHIGHLY COMPENSATED EMPLOYEE means an Employee of the Employer who is neither
a Highly Compensated Employee nor a Family Member.
NONVESTED ACCOUNT means the part, if any, of a Participant's Account that is in
excess of his Vested Account.
NORMAL FORM means a single life annuity with installment refund.
NORMAL RETIREMENT AGE means the age at which the Participant's normal retirement
benefit becomes nonforfeitable. A Participant's Normal Retirement Age is 65.
NORMAL RETIREMENT DATE means the earliest first day of the month on or after the
date the Participant reaches his Normal Retirement Age. Unless otherwise
provided in this Plan, a Participant's retirement benefits shall begin on a
Participant's Normal Retirement Date if he has ceased to be an Employee on such
date and has a Vested Account. Even if the Participant is an Employee on his
Normal Retirement Date, he may choose to have his retirement benefit begin on
such date. See the WHEN BENEFITS START SECTION of Article V.
PARENTAL ABSENCE means an Employee's absence from work which begins on or after
the first Yearly Date after December 31, 1984,
a) by reason of pregnancy of the Employee,
b) by reason of birth of a child of the Employee,
c) by reason of the placement of a child with the Employee in connection
with adoption of such child by such Employee, or
d) for purposes of caring for such child for a period beginning
immediately following such birth or placement.
PARTICIPANT means either an Active Participant or an Inactive Participant.
PERIOD OF MILITARY DUTY means, for an Employee
a) who served as a member of the armed forces of the United States, and
b) who was reemployed by the Employer at a time when the Employee had a
right to reemployment in accordance with seniority rights as protected
under Section 2021 through 2026 of Title 38 of the U.S. Code,
14
<PAGE>
the period of time from the date the Employee was first absent from active work
for the Employer because of such military duty to the date the Employee was
reemployed.
PERIOD OF SERVICE means a period of time beginning on an Employee's Employment
Commencement Date or Reemployment Commencement Date (whichever applies) and
ending on his Severance from Service Date.
PERIOD OF SEVERANCE means a period of time beginning on an Employee's Severance
from Service Date and ending on the date he again performs an Hour-of-Service.
A one-year Period of Severance means a Period of Severance of 12 consecutive
months.
Solely for purposes of determining whether a one-year Period of Severance has
occurred for eligibility or vesting purposes, the 12-consecutive month period
beginning on the first anniversary of the first date of a Parental Absence shall
not be a one-year Period of Severance.
PLAN means the retirement savings plan of the Employer set forth in this
document, including any later amendments to it.
PLAN ADMINISTRATOR means the person or persons who administer the Plan.
The Plan Administrator is the Employer.
PLAN YEAR means a period beginning on a Yearly Date and ending on the day before
the next Yearly Date.
PREDECESSOR EMPLOYER means a firm absorbed by the Employer by change of name,
merger, acquisition or a change of corporate status, or a firm of which the
Employer was once a part.
PRIMARY EMPLOYER means BARRETT RESOURCES CORPORATION.
QUALIFIED JOINT AND SURVIVOR FORM means, for a Participant who has a spouse, an
immediate survivorship life annuity with installment refund, where the
survivorship percentage is 50% and the Contingent Annuitant is the Participant's
spouse. A former spouse will be treated as the spouse to the extent provided
under a qualified domestic relations order as described in Code Section 414(p).
If a Participant does not have a spouse, the Qualified Joint and Survivor Form
means the Normal Form.
The amount of benefit payable under the Qualified Joint and Survivor Form shall
be the amount of benefit which may be provided by the Participant's Vested
Account.
QUALIFIED PRERETIREMENT SURVIVOR ANNUITY means a single life annuity with
installment refund payable to the surviving spouse of a Participant who dies
before his Annuity Starting Date. A former spouse will be treated as the
surviving spouse to the extent provided under a qualified domestic relations
order as described in Code Section 414(p).
QUALIFYING EMPLOYER SECURITY means any instrument issued by the Employer and
meeting the requirements of Section 4975(e)(8) of the Code.
QUARTERLY DATE means each Yearly Date and the third, sixth and ninth Monthly
Date after each Yearly Date which is within the same Plan Year.
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<PAGE>
REEMPLOYMENT COMMENCEMENT DATE means the date an Employee first performs an
Hour-of-Service following
a) an Eligibility Break in Service, for the hours method of crediting
service in this Plan, or
b) a Period of Severance, for the elapsed time method of crediting service
in this Plan.
REENTRY DATE means the date a former Active Participant reenters the Plan. See
the ACTIVE PARTICIPANT SECTION of Article II.
REGISTRATION TYPE QUALIFYING EMPLOYER SECURITY is a class of securities which is
required to be registered under Section 12 of the Securities Exchange Act of
1934 or which would be required to be so registered if it did not qualify for
the exemption from registration provided in Section 12(g)(2)(H) of said Act.
RETIREMENT DATE means the date a retirement benefit will begin and is a
Participant's Early, Normal or Late Retirement Date, as the case may be.
ROLLOVER CONTRIBUTIONS means the Rollover Contributions which are made by or for
a Participant according to the provisions of the ROLLOVER CONTRIBUTIONS SECTION
of Article III.
SEVERANCE FROM SERVICE DATE means the earlier of
a) the date on which an Employee quits, retires, dies or is discharged, or
b) the first anniversary of the date an Employee begins a one-year absence
from service (with or without pay). This absence may be the result of
any combination of vacation, holiday, sickness, disability, leave of
absence or layoff.
Solely to determine whether a one-year Period of Severance has occurred for
eligibility or vesting purposes for an Employee who is absent from service
beyond the first anniversary of the first day of a Parental Absence, Severance
from Service Date is the second anniversary of the first day of the Parental
Absence. The period between the first and second anniversaries of the first day
of the Parental Absence is not a Period of Service and is not a Period of
Severance.
TEFRA means the Tax Equity and Fiscal Responsibility Act of 1982.
TEFRA COMPLIANCE DATE means the date a plan is to comply with the provisions of
TEFRA. The TEFRA Compliance Date as used in this Plan is,
a) for purposes of contribution limitations, Code Section 415,
1) if the plan was in effect on July 1, 1982, the first day of the
first limitation year which begins after December 31, 1982, or
2) if the plan was not in effect on July 1, 1982, the first day of the
first limitation year which ends after July 1, 1982.
b) for all other purposes, the first Yearly Date after December 31, 1983.
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TOTALLY AND PERMANENTLY DISABLED means that a Participant is disabled, as a
result of sickness or injury, to the extent that he is prevented from engaging
in any substantial gainful activity. and is eligible for and receives a
disability benefit under Title II of the Federal Social Security Act.
TRUST means an agreement of trust between the Primary Employer and Trustee
established for the purpose of holding and distributing the Trust Fund under the
provisions of the Plan. The Trust may provide for the investment of all or any
portion of the Trust Fund in the Group Contract and any Insurance Policy.
TRUST FUND means the total funds held under the Trust for the purpose of
providing benefits for Participants. These funds result from Contributions made
under the Plan which are forwarded to the Trustee to be deposited in the Trust
Fund.
TRUSTEE means the trustee or trustees under the Trust. The term Trustee as it is
used in this Plan is deemed to include the plural unless the context clearly
indicates otherwise.
VALUATION DATE means for purposes of the date on which the value of the assets
of the Trust is determined. The value of each Account which is maintained under
this Plan shall be determined on the Valuation Date. In each Plan Year the
Valuation Date shall be the last date of each calendar quarter. In addition, the
Plan Administrator may designate from time to time, so long as the Trustee,e
agrees, that another date or dates shall be Valuation Dates with respect to a
specific Plan Year.
VESTED ACCOUNT means the vested part of a Participant's Account including the
cash values of any Insurance Policy for him. The Participant's Vested Account is
determined as follows.
If the Participant's Vesting Percentage is 100%, his Vested Account equals his
Account.
If the Participant's Vesting Percentage is less than 100%, his Vested Account
equals the sum of (a) and (b) below:
a) The part of the Participant's Account that results from Employer
Contributions made before a prior Forfeiture Date and all other
Contributions which were 100% vested when made.
b) The balance of the Participant's Account in excess of the amount in (a)
above multiplied by his Vesting Percentage.
If the Participant has withdrawn any part of his Account resulting from Employer
Contributions, other than the vested Employer Contributions included in (a)
above, the amount determined under this subparagraph (b) shall be equal to
P(AB+ D) - D as defined below:
P The Participant's Vesting Percentage.
AB The balance of the Participant's Account in excess of the amount in (a)
above.
D The amount of withdrawal resulting from Employer Contributions. other than
the vested Employer Contributions included in (a) above.
The Participant's Vested Account is nonforfeitable.
VESTING PERCENTAGE means the percentage used to determine the nonforfeitable
portion of a
17
<PAGE>
Participant's Account attributable to Employer Contributions which were not 100%
vested when made.
A Participant's Vesting Percentage is shown in the following schedule opposite
the number of whole years of his Vesting Service.
VESTING SERVICE VESTING
(whole years) PERCENTAGE
Less than 2 0
2 20
3 40
4 60
5 80
6 or more 100
However, the Vesting Percentage for a Participant who is an Employee on or after
the earliest of (i) the date he reaches his Normal Retirement Age, (ii) the date
of his death, (iii) the date he meets the requirement(s) for an Early Retirement
Date, or (iv) the date he becomes Totally and Permanently Disabled, shall be
100% on such date.
If the schedule used to determine a Participant's Vesting Percentage is changed,
the new schedule shall not apply to a Participant unless he is credited with an
Hour-of-Service on or after the date of the change and the Participant's
nonforfeitable percentage on the day before the date of the change is not
reduced under this Plan. The amendment provisions of the AMENDMENT SECTION of
Article IX regarding changes in the computation of the Vesting Percentage shall
apply.
VESTING SERVICE means an Employee's Period of Service. If he has more than one
Period of Service or if all or a part of a Period of Service is not counted, his
Vesting Service shall be determined by adjusting his Employment Commencement
Date so that he has one continuous period of Vesting Service equal to the
aggregate of all his countable Periods of Service. This period of Vesting
Service shall be expressed as whole years and fractional parts of a year (to two
decimal places) on the basis that 365 days equal one year.
However. Vesting Service is modified as follows:
Predecessor Employer service included:
An Employee's service with a Predecessor Employer shall be included as
service with the Employer. If this Plan is not a continuation of a plan of
that Predecessor Employer, an Employee's service with that Predecessor
Employer shall be counted only if service continued with the Employer
without interruption. This service excludes service performed while a
proprietor or partner.
Period of Military Duty included:
A Period of Military Duty shall be included as service with the Employer to
the extent it has not already been credited.
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Period of Severance included (service spanning rule):
A Period of Severance shall be deemed to be a Period of Service under either
of the following conditions:
a) the Period of Severance immediately follows a period during which an
Employee is not absent from work and ends within 12 months; or
b) the Period of Severance immediately follows a period during which an
Employee is absent from work for any reason other than quitting,
being discharged or retiring (such as a leave of absence or layoff)
and ends within 12 months of the date he was first absent.
Controlled Group service included:
An Employee's service with a member firm of a Controlled Group while both
that firm and the Employer were members of the Controlled Group shall be
included as service with the Employer.
YEARLY DATE means April 1,1991, and each following January 1.
YEARS OF SERVICE means an Employee's Vesting Service disregarding any
modifications which exclude service.
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ARTICLE II
PARTICIPATION
SECTION 2.01--ACTIVE PARTICIPANT.
a) An Employee shall first become an Active Participant (begin active
participation in the Plan) on the earliest Quarterly Date on or after
April 1, 1996, on which he is an Eligible Employee and has met both of
the eligibility requirements set forth below. This date is his Entry
Date.
1) He has completed one year of Eligibility Service before his Entry
Date.
2) He is age 21 or older.
Each Employee who was an Active Participant under the Plan on March 31,
1996, shall continue to be an Active Participant if he is still an
Eligible Employee on April 1,1996, and his Entry Date shall not change.
If a person has been an Eligible Employee who has met all the
eligibility requirements above, but is not an Eligible Employee on the
date which would have been his Entry Date, he shall become an Active
Participant on the date he again becomes an Eligible Employee. This date
is his Entry Date.
b) An Inactive Participant shall again become an Active Participant (resume
active participation in the Plan) on the date he again performs an
Hour-of-Service as an Eligible Employee. This date is his Reentry Date.
Upon again becoming an Active Participant, he shall cease to be an
Inactive Participant
c) A former Participant shall again become an Active Participant (resume
active participation in the Plan) on the date he again performs an
Hour-of-Service as an Eligible Employee. This date is his Reentry Date.
There shall be no duplication of benefits for a Participant under this Plan
because of more than one period as an Active Participant.
SECTION 2.02--INACTIVE PARTICIPANT.
An Active Participant shall become an Inactive Participant (stop accruing
benefits under the Plan) on the earlier of the following:
a) The date on which he ceases to be an Eligible Employee (on his
Retirement Date if the date he ceases to be an Eligible Employee occurs
within one month of his Retirement Date).
b) The effective date of complete termination of the Plan.
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An Employee or former Employee who was an Inactive Participant under the
Plan on March 31, 1996, shall continue to be an Inactive Participant on April 1,
1996. Eligibility for any benefits payable to him or on his behalf and the
amount of the benefits shall be determined according to the provisions of the
prior document, unless otherwise stated in this document.
SECTION 2.03--CESSATION OF PARTICIPATION.
A Participant shall cease to be a Participant on the date he is no longer an
Eligible Employee and his Account is zero.
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ARTICLE III
CONTRIBUTIONS
SECTION 3.01 --EMPLOYER CONTRIBUTIONS.
Employer Contributions for Plan Years which end on or after April 1,1996,
may be made without regard to current or accumulated net income, earnings, or
profits of the Employer. Notwithstanding the foregoing, the Plan shall continue
to be designed to qualify as a profit sharing plan for purposes of Code Sections
401(a), 402, 412, and 417. Such Contributions will be equal to the Employer
Contributions as described below:
a) The amount of each Elective Deferral Contribution for a Participant
shall be equal to any percentage (not more than 15%) of his Compensation
as elected in his elective deferral agreement. An Employee who is
eligible to participate in the Plan may file an elective deferral
agreement with the Employer. The elective deferral agreement to start
Elective Deferral Contributions may be effective on a Participant's
Entry Date (Reentry Date, if applicable) or any following date. The
Participant shall make any change or terminate the elective deferral
agreement by filing a new elective deferral agreement. A Participant's
elective deferral agreement making a change may be effective on any date
an elective deferral agreement to start Elective Deferral Contributions
could be effective. A Participant's elective deferral agreement to stop
Elective Deferral Contributions may be effective on any date. The
elective deferral agreement must be in writing and completed before the
beginning of the pay period in which Elective Deferral Contributions are
to start, change or stop.
Elective Deferral Contributions are fully (100%) vested and
nonforfeitable.
b) The amount of each Matching Contribution for a Participant shall be
equal to 100% of the Elective Deferral Contributions made for him,
disregarding any Elective Deferral Contributions in excess of 6% of his
Compensation.
One hundred percent of each Matching Contribution shall be made in cash,
and one-half of this Matching Contribution shall be used by the Trustee
to acquire shares of Qualifying Employer Securities as soon as
practicable following receipt by the Trustee of the Matching
Contribution.
At the end of the Plan Year, if the Employer so determines, the Employer
may make another Matching Contribution for a Participant eligible for an
allocation at the end of the Plan Year. If made, the amount of this
Matching Contribution for a Participant shall be equal to a percentage
(not more than 100%) as determined by the Employer, of the Elective
Deferral Contributions made for him for the Plan Year, disregarding any
Elective Deferral Contributions in excess of 6% of his Compensation for
the Plan Year, reduced by the amount of the Matching Contributions made
for him above.
Matching Contributions are subject to the Vesting Percentage.
c) The amount of each Discretionary Contribution shall be determined by the
Employer.
Discretionary Contributions are subject to the Vesting Percentage.
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No Participant shall be permitted to have Elective Deferral Contributions,
as defined in the EXCESS AMOUNTS SECTION of Article III, made under this Plan,
or any other qualified plan maintained by the Employer, during any taxable year,
in excess of the dollar limitation contained in Code Section 402(g) in effect at
the beginning of such taxable year.
The Employer shall pay to the Trustee its Contributions used to determine
the Actual Deferral Percentage, as defined in the EXCESS AMOUNTS SECTION of
Article III, to the Plan for each Plan Year not later than the end of the
twelve-month period immediately following the Plan Year for which they are
deemed to be paid. Any such Contributions accumulated through payroll deductions
shall be paid within 90 days of the date withheld or the date it is first
reasonably practical for the Employer to do so, if earlier, or within such
earlier time period as may be established by regulations pursuant to ERISA.
A portion of the Plan assets resulting from Employer Contributions (but not
more than the original amount of those Contributions and reduced proportionately
for losses, if applicable) may be returned if the Employer Contributions are
made because of a mistake of fact or are more than the amount deductible under
Code Section 404 (excluding any amount which is not deductible because the Plan
is disqualified). The amount involved must be returned to the Employer within
one year after the date the Employer Contributions are made by mistake of fact
or the date the deduction is disallowed, whichever applies. Except as provided
under this paragraph and Article VII, the assets of the Plan shall never be used
for the benefit of the Employer and are held for the exclusive purpose of
providing benefits to Participants and their Beneficiaries and for defraying
reasonable expenses of administering the Plan.
SECTION 3.01A--ROLLOVER CONTRIBUTIONS.
A Rollover Contribution may be made by or for an Eligible Employee if the
following conditions are met:
a) The Contribution is a rollover contribution which the Code permits to be
transferred to a plan that meets the requirements of Code
Section 401(a).
b) If the Contribution is made by the Eligible Employee, it is made within
sixty days after he receives the distribution.
c) The Eligible Employee furnishes evidence satisfactory to the Plan
Administrator that the proposed transfer is in fact a rollover
contribution that meets conditions (a) and (b) above.
The Rollover Contribution may be made by the Eligible Employee or the
Eligible Employee may direct the trustee or named fiduciary of another plan to
transfer the funds which would otherwise be a Rollover Contribution directly to
this Plan. Such transferred funds shall be called a Rollover Contribution. The
Contribution shall be made according to procedures set up by the Plan
Administrator.
If the Eligible Employee is not an Active Participant at the time the
Rollover Contribution is made, he shall be deemed to be a Participant only for
the purposes of investment and distribution of the Rollover Contribution. He
shall not share in the allocation of Employer Contributions until the time he
meets all the requirements to become an Active Participant.
23
<PAGE>
Rollover Contributions made by or for an Eligible Employee shall be credited
to his Account. The part of the Participant's Account resulting from Rollover
Contributions is fully (100%) vested and nonforfeitable at all times. A separate
accounting record shall be maintained for that part of his Rollover Contribution
which consists of voluntary contributions that were deducted from the
Participant's gross income for Federal income tax purposes.
SECTION 3.02--FORFEITURES.
The Nonvested Account of a Participant shall be forfeited as of the earlier
of the following: the date of the Participant's death, if prior to such date he
had ceased to be an Employee; or his Forfeiture Date. All or a part of a
Participant's Nonvested Account will be forfeited if, after he ceases to be an
Employee, he receives a distribution of his entire Vested Account or a
distribution of his Vested Account derived from Employer Contributions which
were not 100% vested when made according to the provisions of the VESTED
BENEFITS SECTION of Article V or the SMALL AMOUNTS SECTION of Article IX. If a
Participant's Vested Account is zero on the date he ceases to be an Employee, he
shall be deemed to have received a distribution of his entire Vested Account on
such date. The forfeiture will occur as of the date he receives the distribution
or on the date such provision became effective, if later. If he receives a
distribution of his entire Vested Account, his entire Nonvested Account will be
forfeited. If he receives a distribution of his Vested Account from Employer
Contributions which were not 100% vested when made, but less than his entire
Vested Account, the amount to be forfeited will be determined by multiplying his
Nonvested Account by a fraction. The numerator of the fraction is the amount of
the distribution derived from Employer Contributions which were not 100% vested
when made and the denominator of the fraction is his entire Vested Account
derived from such Employer Contributions on the date of distribution.
A Forfeiture shall also occur as described in the EXCESS AMOUNTS SECTION of
Article III.
Forfeitures may first be applied to pay administrative expenses under the
Plan which would otherwise be paid by the Employer.
Forfeitures not used to pay administrative expenses shall be applied to
reduce the earliest Employer Contributions made after the Forfeitures are
determined. Forfeitures shall be determined at least once during each taxable
year of the Employer. Upon their application, such Forfeitures shall be deemed
to be Employer Contributions.
Forfeitures of Matching Contributions which relate to excess amounts shall
be applied as provided in the EXCESS AMOUNTS SECTION of Article III.
If a Participant again becomes an Eligible Employee after receiving a
distribution which caused his Nonvested Account to be forfeited, he shall have
the right to repay to the Plan the entire amount of the distribution he received
(excluding any amount of such distribution resulting from Contributions which
were 100% vested when made). The repayment must be made before the earlier of
the date five years after the date he again becomes an Eligible Employee or the
end of the first period of five consecutive one-year Periods of Severance which
begin after the date of the distribution.
If the Participant makes the repayment provided above, the Plan
Administrator shall restore to his Account an amount equal to his Nonvested
Account which was forfeited on the date of distribution, unadjusted for any
investment gains or losses. If the amount of the repayment is zero dollars
because the Participant was deemed to have received a distribution or the plan
did not have repayment provisions in effect on the date the distribution was
made and he again performs an Hour-of-Service as an Eligible Employee within the
repayment period, the Plan Administrator shall restore the Participant's Account
as if he had made a required repayment on the date he
24
<PAGE>
performed such Hour-of-Service. Restoration of the Participant's Account shall
include restoration of all Code Section 411(d)(6) protected benefits with
respect to that restored Account, according to applicable Treasury regulations.
Provided, however, the Plan Administrator shall not restore the Nonvested
Account if a Forfeiture Date has occurred after the date of the distribution and
on or before the date of repayment and that Forfeiture Date would result in a
complete forfeiture of the amount the Plan Administrator would otherwise
restore.
The Plan Administrator shall restore the Participant's Account by the close
of the Plan Year following the Plan Year in which repayment is made. Permissible
sources for restoration are Forfeitures or Employer Contributions. The Employer
shall contribute, without regard to any requirement or condition of the EMPLOYER
CONTRIBUTIONS SECTION of Article III, such additional amount needed to make the
required restoration. The repaid and restored amounts are not included in the
Participant's Annual Addition, as defined in the CONTRIBUTION LIMITATION SECTION
of Article III.
SECTION 3.03--ALLOCATION.
The following Contributions for the Plan Year shall be allocated among all
eligible persons:
Matching Contributions made at the end of the Plan Year Discretionary
Contributions
The eligible persons are all Participants who are Active Participants on the
last day of the Plan Year. The amount allocated to such a person shall be
determined below and under Article X.
The following Contributions for each Plan Year shall be allocated to each
Participant for whom such Contributions were made under the EMPLOYER
CONTRIBUTIONS SECTION of Article III.
Elective Deferral Contributions
Matching Contributions made before the end of the Plan Year
These Contributions shall be allocated when made and credited to the
Participant's Account.
The following Contributions are allocated as of the last day of the Plan
Year to each eligible person for whom they are made and credited to his Account:
Matching Contributions made at the end of the Plan Year
Discretionary Contributions are allocated as of the last day of each Plan
Year. The amount allocated to each eligible person for the Plan Year shall be
equal to the Discretionary Contributions for the Plan Year, multiplied by the
ratio of (a) his Annual Compensation as of the last day of the Plan Year to (b)
the total of such compensation for all eligible persons. This amount is credited
to his Account
In determining the amount of Employer Contributions to be allocated to a
Participant who is a Leased Employee, contributions and benefits provided by the
leasing organization which are attributable to services such Leased Employee
performs for the Employer shall be treated as provided by the Employer and there
shall be no duplication of those contributions or benefits under this Plan.
25
<PAGE>
SECTION 3.04--CONTRIBUTION LIMITATION.
a) For the purpose of determining the contribution limitation set forth in
this section, the following terms are defined:
Aggregate Annual Addition means, for a Participant with respect to any
-------------------------
Limitation Year, the sum of his Annual Additions under all defined
contribution plans of the Employer. as defined in this section. for such
Limitation Year. The nondeductible participant contributions which the
Participant makes to a defined benefit plan shall be treated as Annual
Additions to a defined contribution plan. The Contributions the
Employer, as defined in this section, made for the Participant for a
Plan Year beginning on or after March 31, 1984, to an individual medical
benefit account, as defined in Code Section 415(l)(2), under a pension
or annuity plan of the Employer, as defined in this section, shall be
treated as Annual Additions to a defined contribution plan. Also,
amounts derived from contributions paid or accrued after December
31,1985, in Fiscal Years ending after such date, which are attributable
to post-retirement medical benefits allocated to the separate account of
a key employee, as defined in Code Section 419A(d)(3), under a welfare
benefit fund, as defined in Code Section 419(e), maintained by the
Employer, as defined in this section, are treated as Annual Additions to
a defined contribution plan. The 25% of Compensation limit under
Maximum Permissible Amount does not apply to Annual Additions resulting
from contributions made to an individual medical account, as defined in
Code Section 415(1)(2), or to Annual Additions resulting from
contributions for medical benefits, within the meaning of Code Section
419A, after separation from service.
Annual Addition means the amount added to a Participant's account for
---------------
any Limitation Year which may not exceed the Maximum Permissible Amount.
The Annual Addition under any plan for a Participant with respect to any
Limitation Year, shall be equal to the sum of (1) and (2) below:
1) Employer contributions and forfeitures credited to his account for
the Limitation Year.
2) Participant contributions made by him for the Limitation Year.
Before the first Limitation Year beginning after December 31, 1986, the
amount under (2) above is the lesser of (i) 1/2 of his nondeductible
participant contributions made for the Limitation Year, or (ii) the
amount, if any, of his nondeductible participant contributions made for
the Limitation Year which is in excess of six percent of his
Compensation, as defined in this section, for such Limitation Year.
Compensation means all wages for Federal income tax withholding
------------
purposes, as defined under Code Section 3401(a) (for purposes of income
tax withholding at the source), disregarding any rules limiting the
remuneration included as wages based on the nature or location of the
employment or the services performed. Compensation also includes all
other payments to an Employee in the course of the Employer's trade or
business, for which the Employer must furnish the Employee a written
statement under Code Sections 6041(d) and 6051(a)(3). The amount
reported in the "Wages, Tips and Other Compensation" box on Form W-2
satisfies this definition.
For any self-employed individual Compensation will mean earned income.
For purposes of applying the limitations of this section, Compensation
for a Limitation Year is the Compensation actually paid or made
available during such Limitation Year.
26
<PAGE>
Defined Benefit Plan Fraction means, with respect to a Limitation Year for a
- -----------------------------
Participant who is or has been a participant in a defined benefit plan ever
maintained by the Employer, as defined in this section, the quotient, expressed
as a decimal, of
1) the Participant's Projected Annual Benefit under all such plans as of the
close of such Limitation Year, divided by
2) on and after the TEFRA Compliance Date, the lesser of (i) or (ii) below:
i) 1.25 multiplied by the maximum dollar limitation which applies to
defined benefit plans determined for the Limitation Year under Code
Sections 415(b) or (d) or
ii) 1.4 multiplied by the Participant's highest average compensation as
defined in the defined benefit plan(s),
including any adjustments under Code Section 415(b).
Before the TEFRA Compliance Date, this denominator is the Participant's
Projected Annual Benefit as of the close of the Limitation Year if the
plan(s) provided the maximum benefit allowable.
The Defined Benefit Plan Fraction shall be modified as follows:
If the Participant was a participant as of the first day of the first Limitation
Year beginning after December 31, 1986, in one or more defined benefit plans
maintained by the Employer, as defined in this section, which were in existence
on May 6, 1986, the denominator of this fraction will not be less than 125
percent of the sum of the annual benefits under such plans which the Participant
had accrued as of the close of the last Limitation Year beginning before January
1, 1987, disregarding any changes in the terms and conditions of the plan after
May 5, 1986. The preceding sentence applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of Code Section 415
for all Limitation Years beginning before January 1, 1987.
Defined Contribution Plan Fraction means, for a Participant with respect to a
- ----------------------------------
Limitation Year, the quotient, expressed as a decimal, of
1) the Participant's Aggregate Annual Additions for such Limitation Year and
all prior Limitation Years, under all defined contribution plans (including
the Aggregate Annual Additions attributable to nondeductible accounts under
defined benefit plans and attributable to all welfare benefit funds, as
defined in Code Section 419(e) and attributable to individual medical
accounts, as defined in Code Section 415(l) (2)) ever maintained by the
Employer, as defined in this section, divided by
2) on and after the TEFRA Compliance Date, the sum of the amount determined for
the Limitation Year under (i) or (ii) below, whichever is less, and the
amounts determined in the same manner for all prior Limitation Years during
which he has been an Employee or an employee of a predecessor employer:
27
<PAGE>
i) 1.25 multiplied by the maximum permissible dollar amount for each such
Limitation Year, or
ii) 1.4 multiplied by the maximum permissible percentage of the
Participant's Compensation, as defined in this section, for each such
Limitation Year.
Before the TEFRA Compliance Date, this denominator is the sum of the maximum
allowable amount of Annual Addition to his account(s) under all the plan(s)
of the Employer, as defined in this section, for each such Limitation Year.
The Defined Contribution Plan Fraction shall be modified as follows:
If the Participant was a participant as of the first day of the first Limitation
Year beginning after December 31, 1986, in one or more defined contribution
plans maintained by the Employer, as defined in this section, which were in
existence on May 6, 1986, the numerator of this fraction shall be adjusted if
the sum of the Defined Contribution Plan Fraction and Defined Benefit Plan
Fraction would otherwise exceed 1.0 under the terms of this Plan. Under the
adjustment, the dollar amount determined below shall be permanently subtracted
from the numerator of this fraction. The dollar amount is equal to the excess of
the sum of the two fractions, before adjustment, over 1.0 multiplied by the
denominator of his Defined Contribution Plan Fraction. The adjustment is
calculated using his Defined Contribution Plan Fraction and Defined Benefit Plan
Fraction as they would be computed as of the end of the last Limitation Year
beginning before January 1, 1987, and disregarding any changes in the terms and
conditions of the plan made after May 5, 1986, but using the Code Section 415
limitations applicable to the first Limitation Year beginning on or after
January 1, 1987.
The Annual Addition for any Limitation Year beginning before January 1, 1987,
shall not be recomputed to treat all employee contributions as Annual Additions.
For a plan that was in existence on July 1, 1982, for purposes of determining
the Defined Contribution Plan Fraction for any Limitation Year ending after
December 31, 1982, the Plan Administrator may elect, in accordance with the
provisions of Code Section 415, that the denominator for each Participant for
all Limitation Years ending before January 1, 1983, will be equal to
1) the Defined Contribution Plan Fraction denominator which would apply for the
last Limitation Year ending in 1982 if an election under this paragraph were
not made, multiplied by
2) a fraction, equal to (i) over (ii) below:
i) the lesser of (A) $51,875, or (B) 1.4, multiplied by 25% of the
Participant's Compensation, as defined in this section, for the
Limitation Year ending in 1981;
ii) the lesser of (A) $41,500, or (B) 25% of the Participant's Compensation,
as defined in this section, for the Limitation Year ending in 1981.
The election described above is applicable only if the plan administrators under
all defined contribution plans of the Employer, as defined in this section, also
elect to use the modified fraction.
28
<PAGE>
Employer means any employer that adopts this Plan and all Controlled Group
--------
members and any other entity required to be aggregated with the employer
pursuant to regulations under Code Section 414(o).
Limitation Year means the 12-consecutive month period within which it is
---------------
determined whether or not the limitations of Code Section 415 are exceeded.
Limitation Year means each 12-consecutive month period ending on December
31. If the Limitation Year is other than the calendar year, execution of
this Plan (or any amendment to this Plan changing the Limitation Year)
constitutes the Employer's adoption of a written resolution electing the
Limitation Year. If the Limitation Year is changed, the new Limitation Year
shall begin within the current Limitation Year, creating a short Limitation
Year.
Maximum Permissible Amount means, for a Participant with respect to any
--------------------------
Limitation Year, the lesser of (1) or (2) below:
1) The greater of $30,000 or one-fourth of the maximum dollar limitation
which applies to defined benefit plans set forth in Code
Section 41 5(b)( 1) as in effect for the Limitation Year. (Before the
TEFRA Compliance Date, $25,000 multiplied by the cost of living
adjustment factor permitted by Federal regulations.)
2) 25% of his Compensation, as defined in this section, for such Limitation
Year.
The compensation limitation referred to in (2) shall not apply to any
contribution for medical benefits (within the meaning of Code Section 401(h)
or Code Section 419A(f)(2)) which is otherwise treated as an annual addition
under Code Section 415(l)(1) or Code Section 419A(d)(2).
If there is a short Limitation Year because of a change in Limitation Year,
the Maximum Permissible Amount will not exceed the maximum dollar limitation
which would otherwise apply multiplied by the following fraction:
Number of months in the short Limitation Year
---------------------------------------------
12
Projected Annual Benefit means a Participant's expected annual benefit under
------------------------
all defined benefit plan(s) ever maintained by the Employer, as defined in
this section. The Projected Annual Benefit shall be determined assuming that
the Participant will continue employment until the later of current age or
normal retirement age under such plan(s), and that the Participant's
compensation for the current Limitation Year and all other relevant factors
used to determine benefits under such plan(s) will remain constant for all
future Limitation Years. Such expected annual benefit shall be adjusted to
the actuarial equivalent of a straight life annuity if expressed in a form
other than a straight life or qualified joint and survivor annuity.
b) The Annual Addition under this Plan for a Participant during a Limitation
Year shall not be more than the Maximum Permissible Amount.
29
<PAGE>
c) Contributions which would otherwise be credited to the Participant's Account
shall be limited or reallocated to the extent necessary to meet the
restrictions of subparagraph (b) above for any Limitation Year in the
following order. Discretionary Contributions shall be reallocated in the
same manner as described in the ALLOCATION SECTION of Article III to the
remaining Participants to whom the limitations do not apply for the
Limitation Year. The Discretionary Contributions shall be limited if there
are no such remaining Participants. Elective Deferral Contributions that are
not the basis for Matching Contributions shall be limited. Matching
Contributions shall be limited to the extent necessary to limit the
Participant's Annual Addition under this Plan to his maximum amount. If
Matching Contributions are limited because of this limit, Elective Deferral
Contributions that are the basis for Matching Contributions shall be reduced
in proportion.
If, due to (i) an error in estimating a Participant's Compensation as
defined in this section, (ii) because the amount of the Forfeitures to be
used to offset Employer Contributions is more than the amount of the
Employer Contributions due for the remaining Participants, (iii) as a result
of a reasonable error in determining the amount of elective deferrals
(within the meaning of Code Section 402(g)(3)) that may be made with respect
to any individual under the limits of Code Section 415, or (iv) other
limited facts and circumstances, a Participant's Annual Addition is greater
than the amount permitted in (b) above, such excess amount shall be applied
as follows. Elective Deferral Contributions which are not the basis for
Matching Contributions will be returned to the Participant. If an excess
still exists, Elective Deferral Contributions that are the basis for
Matching Contributions will be returned to the Participant. Matching
Contributions based on Elective Deferral Contributions which are returned
shall be forfeited. If after the return of Elective Deferral Contributions,
an excess amount still exists, and the Participant is an Active Participant
as of the end of the Limitation Year, the excess amount shall be used to
offset Employer Contributions for him in the next Limitation Year. If after
the return of Elective Deferral Contributions, an excess amount still
exists, and the Participant is not an Active Participant as of the end of
the Limitation Year, the excess amount will be held in a suspense account
which will be used to offset Employer Contributions for all Participants in
the next Limitation Year. No Employer Contributions that would be included
in the next Limitation Year's Annual Addition may be made before the total
suspense account has been used.
d) A Participant's Aggregate Annual Addition for a Limitation Year shall not
exceed the Maximum Permissible Amount.
If, for the Limitation Year, the Participant has an Annual Addition under
more than one defined contribution plan or a welfare benefit fund, as
defined in Code Section 419(e), or an individual medical account, as defined
in Code Section 415(I)(2), maintained by the Employer, as defined in this
section, and such plans and welfare benefit funds and individual medical
accounts do not otherwise limit the Aggregate Annual Addition to the Maximum
Permissible Amount, any reduction necessary shall be made first to the
profit sharing plans, then to all other such plans and welfare benefit funds
and individual medical accounts and, if necessary, by reducing first those
that were most recently allocated. Welfare benefit funds and individual
medical accounts shall be deemed to be allocated first. However, elective
deferral contributions shall be the last contributions reduced before the
welfare benefit fund or individual medical account is reduced.
30
<PAGE>
If some of the Employer's defined contribution plans were not in
existence on July 1, 1982, and some were in existence on that date, the
Maximum Permissible Amount which is based on a dollar amount may differ
for a Limitation Year. The Aggregate Annual Addition for the Limitation
Year in which the dollar limit differs shall not exceed the lesser of
(1) 25% of Compensation as defined in this section, (2) $45,475, or (3)
the greater of $30,000 or the sum of the Annual Additions for such
Limitation Year under all the plan(s) to which the $45,475 amount
applies.
e) If a Participant is or has been a participant in both defined benefit
and defined contribution plans (including a welfare benefit fund or
individual medical account) ever maintained by the Employer, as defined
in this section, the sum of the Defined Benefit Plan Fraction and the
Defined Contribution Plan Fraction for any Limitation Year shall not
exceed 1.0(1.4 before the TEPRA Compliance Date).
After all other limitations set out in the plans and funds have been
applied, the following limitations shall apply so that the sum of the
Participant's Defined Benefit Plan Fraction and Defined Contribution
Plan Fraction shall not exceed 1.0 (1.4 before the TEFRA Compliance
Date). The Projected Annual Benefit shall be limited first. If the
Participant's annual benefit(s) equal his Projected Annual Benefit, as
limited, then Annual Additions to the defined contribution plan(s) shall
be limited to the extent needed to reduce the sum to 1.0 (1.4). First,
the voluntary contributions the Participant may make for the Limitation
Year shall be limited. Next, in the case of a profit sharing plan, any
forfeitures allocated to the Participant shall be reallocated to
remaining participants to the extent necessary to reduce the decimal to
1.0 (1.4). Last, to the extent necessary, employer contributions for the
Limitation Year shall be reallocated or limited, and any required and
optional employee contributions to which such employer contributions
were geared shall be reduced in proportion.
If, for the Limitation Year, the Participant has an Annual Addition
under more than one defined contribution plan or welfare benefit fund or
individual medical account maintained by the Employer, as defined in
this section, any reduction above shall be made first to the profit
sharing plans, then to all other such plans and welfare benefit plans
and individual medical accounts and, if necessary. by reducing first
those that were most recently allocated. However, elective deferral
contributions shall be the last contributions reduced before the welfare
benefit fund or individual medical account is reduced. The annual
addition to the welfare benefit fund and individual medical account
shall be limited last.
SECTION 3.05--EXCESS AMOUNTS.
a) For the purposes of this section, the following terms are defined:
Actual Deferral Percentage means the ratio (expressed as a percentage)
--------------------------
of Elective Deferral Contributions under this Plan on behalf of the
Eligible Participant for the Plan Year to the Eligible Participant's
Compensation for the Plan Year. In modification of the foregoing,
Compensation shall be limited to the Compensation received while an
Active Participant. The Elective Deferral Contributions used to
determine the Actual Deferral Percentage shall include Excess Elective
Deferrals (other than Excess Elective Deferrals of Nonhighly Compensated
Employees that arise solely from Elective Deferral Contributions made
under this Plan or any other plans of the Employer or a Controlled Group
Member), but shall exclude Elective Deferral Contributions that are used
in computing the Contribution Percentage (provided the Average Actual
Deferral Percentage test is satisfied both with and without exclusion of
these Elective Deferral Contributions). Under such rules as the
Secretary of the Treasury' shall prescribe in Code Section 401(k)(3)(D),
the Employer
31
<PAGE>
may elect to include Qualified Nonelective Contributions and Qualified Matching
Contributions under this Plan in computing the Actual Deferral Percentage. For
an Eligible Participant for whom such Contributions on his behalf for the Plan
Year are zero, the percentage is zero.
Aggregate Limit means the greater of (1) or (2) below:
- ---------------
1) The sum of
i) 125 percent of the greater of the Average Actual Deferral Percentage of
the Nonhighly Compensated Employees for the Plan Year or the Average
Contribution Percentage of Nonhighly Compensated Employees under the
Plan subject to Code Section 401(m) for the Plan Year beginning with or
within the Plan Year of the cash or deferred arrangement and
ii) the lesser of 200% or two plus the lesser of such Average Actual
Deferral Percentage or Average Contribution Percentage.
2) The sum of
i) 125 percent of the lesser of the Average Actual Deferral Percentage of
the Nonhighly Compensated Employees for the Plan Year or the Average
Contribution Percentage of Nonhighly Compensated Employees under the
Plan subject to Code Section 401(m) for the Plan Year beginning with or
within the Plan Year of the cash or deferred arrangement and
ii) the lesser of 200% or two plus the greater of such Average Actual
Deferral Percentage or Average Contributton Percentage.
Average Actual Deferral Percentage means the average (expressed as a percentage)
- ----------------------------------
of the Actual Deferral Percentages of the Eligible Participants in a group.
Average Contribution Percentage means the average (expressed as a percentage) of
- -------------------------------
the Contribution Percentages of the Eligible Participants in a group.
Contribution Percentage means the ratio (expressed as a percentage) of the
- -----------------------
Eligible Participant's Contribution Percentage Amounts to the Eligible
Participant's Compensation for the Plan Year. In modification of the foregoing,
Compensation shall be limited to the Compensation received while an Active
Participant For an Eligible Participant for whom such Contribution Percentage
Amounts for the Plan Year are zero, the percentage is zero.
Contribution Percentage Amounts means the sum of the Participant Contributions
- -------------------------------
and Matching Contributions (that are not Qualified Matching Contributions) under
this Plan on behalf of the Eligible Participant for the Plan Year. Such
Contribution Percentage Amounts shall not include Matching Contributions that
are forfeited either to correct Excess Aggregate Contributions or because the
Contributions to which they relate are Excess Elective Deferrals. Excess
Contributions or Excess Aggregate Contributions. Under such rules as the
Secretary of the Treasury' shall prescribe in Code Section 401(k)(3)(D), the
Employer may elect to include Qualified Nonelective Contributions and Qualified
Matching Contributions under this Plan which were not used in computing the
Actual Deferral Pecentage in computing the Contribution Percentage. The Employer
may also elect to use Elective Deferral Contributions in computing the
Contribution Percentage so long as the Average
32
<PAGE>
Actual Deferral Percentage test is met before the Elective Deferral
Contributions are used in the Average Contribution Percentage test and continues
to be met following the exclusion of those Elective Deferral Contributions that
are used to meet the Average Contribution Percentage test.
Elective Deferral Contributions means employer contributions made on behalf of a
- -------------------------------
participant pursuant to an election to defer under any qualified cash or
deferred arrangement as described in Code Section 401(k), any simplified
employee pension cash or deferred arrangement as described in Code Section
402(h)(i)(B), any eligible deferred compensation plan under Code Section 457,
any plan as described under Code Section 501(c)(18), and any employer
contributions made on behalf of a participant for the purchase of an annuity
contract under Code Section 403(b) pursuant to a salary reduction agreement
Elective Deferral Contributions shall not include any deferrals properly
distributed as excess Annual Additions.
Eligible Participant means, for purposes or determining the Actual Deferral
- --------------------
Percentage, any Employee who is otherwise authorized under the terms of the Plan
to have Elective Deferral Contributions made on his behalf for the Plan Year.
Eligible Participant means, for purposes of determining the Average Contribution
Percentage, any Employee who is otherwise authorized under the terms of the Plan
to have Participant Contributions or Matching Contributions made on his behalf
for the Plan Year.
Excess Aggregate Contributions means, with respect to any Plan Year, the excess
- ------------------------------
of:
1) The aggregate Contributions taken into account in computing the numerator of
the Contribution Percentage actually made on behalf of Highly Compensated
Employees for such Plan Year, over
2) The maximum amount of such Contributions permitted by the Average
Contribution Percentage test (determined by reducing Contributions made on
behalf of Highly Compensated Employees in order of their Contribution
Percentages beginning with the highest of such percentages).
Such determination shall be made after first determining Excess Elective
Deferrals and then determining Excess Contributions.
Excess Contributions means, with respect to any Plan Year, the excess of:
- --------------------
1) The aggregate amount of Contributions actually taken into account in
computing the Actual Deferral Percentage of Highly Compensated Employees for
such Plan Year, over
2) The maximum amount of such Contributions permitted by the Actual Deferral
Percentage test (determined by reducing Contributions made on behalf of
Highly Compensated Employees in order of the Actual Deferral Percentages,
beginning with the highest of such percentages).
A Participant's Excess Contributions for a Plan Year will be reduced by the
amount of Excess Elective Deferrals, if any, previously distributed to the
Participant for the taxable year ending in that Plan Year.
Excess Elective Deferrals means those Elective Deferral Contributions that are
- -------------------------
includable in a Participant's gross income under Code Section 402(g) to the
extent such Participant's Elective Deferral Contributions for a taxable year
exceed the dollar limitation under such Code section.
ARTICLE III
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Excess Elective Deferrals shall be treated as Annual Additions, as
defined in the CONTRIBUTION LIMITATION SECTION of Article III, under the
Plan, unless such amounts are distributed no later than the first April
15 following the close of the Participant's taxable year.
Participant Contributions means contributions made to any plan by or on
-------------------------
behalf of a participant that are included in the participant's gross
income in the year in which made and that are maintained under a
separate account to which earnings and losses are allocated.
Matching Contributions means employer contributions made to this or any
----------------------
other defined contribution plan, or to a contract described in Code
Section 403(b), on behalf of a participant on account of a Participant
Contribution made by such participant, or on account of a participant's
Elective Deferral Contributions, under a plan maintained by the
employer.
Qualified Matching Contributions means Matching Contributions which are
--------------------------------
subject to the distribution and nonforfeitability requirements under
Code Section 401(k) when made.
Qualified Nonelective Contributions means any employer contributions
-----------------------------------
(other than Matching Contributions) which an employee may not elect to
have paid to him in cash instead of being contributed to the plan and
which are subject to the distribution and nonforfeitability requirements
under Code Section 401(k).
b) A Participant may assign to this Plan any Excess Elective Deferrals made
during a taxable year by notifying the Plan Administrator in writing on
or before the first following March 1 of the amount of the Excess
Elective Deferrals to be assigned to the Plan. A Participant is deemed
to notify the Plan Administrator of any Excess Elective Deferrals that
arise by taking into account only those Elective Deferral Contributions
made to this Plan and any other plans of the Employer or a Controlled
Group member and reducing such Excess Elective Deferrals by the amount
of Excess Contributions, if any, previously distributed for the Plan
Year beginning in that taxable year. The Participant's claim for Excess
Elective Deferrals shall be accompanied by the Participant's written
statement that if such amounts are not distributed, such Excess Elective
Deferrals, when added to amounts deferred under other plans or
arrangements described in Code Sections 401(k), 408(k) or 403(b), will
exceed the limit imposed on the Participant by Code Section 402(g) for
the year in which the deferral occurred. The Excess Elective Deferrals
assigned to this Plan can not exceed the Elective Deferral Contributions
allocated under this Plan for such taxable year.
Notwithstanding any other provisions of the Plan, Elective Deferral
Contributions in an amount equal to the Excess Elective Deferrals
assigned to this Plan, plus any income and minus any loss allocable
thereto, shalt be distributed no later than April 15 to any Participant
to whose Account Excess Elective Deferrals were assigned for the
preceding year and who claims Excess Elective Deferrals for such taxable
year.
The income or loss allocable to such Excess Elective Deferrals shall be
equal to the income or loss allocable to the Participant's Elective
Deferral Contributions for the taxable year in which the excess occurred
multiplied by a fraction. The numerator of the fraction is the Excess
Elective Deferrals. The denominator of the fraction is the closing
balance without regard to any income or loss occurring during such
taxable year (as of the end of such taxable year) of the Participant's
Account resulting from Elective Deferral Contributions.
Any Matching Contributions which were based on the Elective Deferral
Contributions which are distributed as Excess Elective Deferrals, plus
any income and minus any loss allocable thereto, shall
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be forfeited. These Forfeitures shall be used to offset the earliest
Employer Contribution due after the Forfeiture arises.
c) As of the end of each Plan Year after Excess Elective Deferrals have been
determined, one of the following tests must be met:
1) The Average Actual Deferral Percentage for Eligible Participants who are
Highly Compensated Employees for the Plan Year is not more than the
Average Actual Deferral Percentage for Eligible Participants who are
Nonhighly Compensated Employees for the Plan Year multiplied by 1.25.
2) The Average Actual Deferral Percentage for Eligible Participants who are
Highly Compensated Employees for the Plan Year is not more than the
Average Actual Deferral Percentage for Eligible Participants who are
Nonhighly Compensated Employees for the Plan Year multiplied by 2 and
the difference between the Average Actual Deferral Percentages is not
more than 2.
The Actual Deferral Percentage for any Eligible Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to have Elective
Deferral Contributions (and Qualified Nonelective Contributions or Qualified
Matching Contributions, or both, if used in computing the Actual Deferral
Percentage) allocated to his account under two or more plans or arrangements
described in Code Section 401(k) that are maintained by the Employer or a
Controlled Group member shall be determined as if all such Elective Deferral
Contributions (and, if applicable, such Qualified Nonelective Contributions
or Qualified Matching Contributions, or both) were made under a single
arrangement. If a Highly Compensated Employee participates in two or more
cash or deferred arrangements that have different Plan Years, all cash or
deferred arrangements ending with or within the same calendar year shall be
treated as a single arrangement. Notwithstanding the foregoing, certain
plans shall be treated as separate if mandatorily disaggregated under the
regulations under Code Section 401(k) or permissiably disaggregated as
provided.
In the event that this Plan satisfies the requirements of Code Sections
401(k), 401(a)(4), or 410(b) only if aggregated with one or more other
plans, or if one or more other plans satisfy the requirements of such Code
sections only if aggregated with this Plan, then this section shall be
applied by determining the Actual Deferral Percentage of employees as if all
such plans were a single plan. Plans may be aggregated in order to satisfy
Code Section 401(k) only if they have the same Plan Year.
For purposes of determining the Actual Deferral Percentage of an Eligible
Participant who is a five-percent owner or one of the ten most highly-paid
Highly Compensated Employees, the Elective Deferral Contributions (and
Qualified Nonelective Contributions or Qualified Matching Contributions, or
both, if used in computing the Actual Deferral Percentage) and Compensation
of such Eligible Participant include the Elective Deferral Contributions
(and, if applicable, Qualified Nonelective Contributions or Qualified
Matching Contributions, or both) and Compensation for the Plan Year of
Family Members. Family Members, with respect to such Highly Compensated
Employees, shall be disregarded as separate employees in determining the
Actual Deferral Percentage both for Participants who are Nonhighly
Compensated Employees and for Participants who are Highly Compensated
Employees.
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For purposes of determining the Actual Deferral Percentage, Elective
Deferral Contributions, Qualified Nonelective Contributions and Qualified
Matching Contributions must be made before the last day of the 12-month
period immediately following the Plan Year to which contributions relate.
The Employer shall maintain records sufficient to demonstrate satisfaction
of the Average Actual Deferral Percentage test and the amount of Qualified
Nonelective Contributions or Qualified Matching Contributions, or both, used
in such test.
The determination and treatment of the Contributions used in computing the
Actual Deferral Percentage shall satisfy such other requirements as may be
prescribed by the Secretary of the Treasury.
If the Plan Administrator should determine during the Plan Year that neither
of the above tests is being met, the Plan Administrator may adjust the
amount of future Elective Deferral Contributions of the Highly Compensated
Employees.
Notwithstanding any other provisions of this Plan, Excess Contributions,
plus any income and minus any loss allocable thereto, shall be distributed
no later than the last day of each Plan Year to Participants to whose
Accounts such Excess Contributions were allocated for the preceding Plan
Year. If such excess amounts are distributed more than 2 1/2 months after
the last day of the Plan Year in which such excess amounts arose, a ten (10)
percent excise tax will be imposed on the employer maintaining the plan with
respect to such amounts. Such distributions shall be made to Highly
Compensated Employees on the basis of the respective portions of the Excess
Contributions attributable to each of such employees. Excess Contributions
of Participants who are subject to the family member aggregation rules shall
be allocated among the Family Members in proportion to the Elective Deferral
Contributions (and amounts treated as Elective Deferral Contributions) of
each Family Member that is combined to determine the combined Actual
Deferral Percentage.
Excess Contributions shall be treated as Annual Additions, as defined in the
CONTRIBUTION LIMITATION SECTION of Article III, under the Plan.
The Excess Contributions shall be adjusted for income or loss. The income or
loss allocable to such Excess Contributions shall be equal to the income or
loss allocable to the Participant's Elective Deferral Contributions (and, if
applicable, Qualified Nonelective Contributions or Qualified Matching
Contributions, or both) for the Plan Year in which the excess occurred
multiplied by a fraction. The numerator of the fraction is the Excess
Contributions. The denominator of the fraction is the closing balance
without regard to any income or loss occurring during such Plan Year (as of
the end of such Plan Year) of the Participant's Account resulting from
Elective Deferral Contributions (and Qualified Nonelective Contributions or
Qualified Matching Contributions, or both, if used in computing the Actual
Deferral Percentage).
Excess Contributions shall be distributed from the Participant's Account
resulting first from Elective Deferral Contributions not the basis for
Matching Contributions, then if necessary', from Elective Deferral
Contributions which are the basis for Matching Contributions. If such Excess
Contributions exceed the balance in the Participant's Account resulting from
Elective Deferral Contributions, the balance shall be distributed from the
Participant's Account resulting from Qualified Matching Contributions (if
applicable) and Qualified Nonelective Contributions, respectively.
Any Matching Contributions which were based on the Elective Deferral
Contributions which are
36
<PAGE>
distributed as Excess Contributions, plus any income and minus any loss
allocable thereto, shall be forfeited. These Forfeitures shall be used to
offset the earliest Employer Contribution due after the Forfeiture arises.
d) As of the end of each Plan Year, one of the following tests must be met:
1) The Average Contribution Percentage for Eligible Participants who are
Highly Compensated Employees for the Plan Year is not more than the
Average Contribution Percentage for Eligible Participants who are
Nonhighly Compensated Employees for the Plan Year multiplied by 1.25.
2) The Average Contribution Percentage for Eligible Participants who are
Highly Compensated Employees for the Plan Year is not more than the
Average Contribution Percentage for Eligible Participants who are
Nonhighly Compensated Employees for the Plan Year multiplied by 2 and
the difference between the Average Contribution Percentages is not more
than 2.
If one or more Highly Compensated Employees participate in both a cash or
deferred arrangement and a plan subject to the Average Contribution
Percentage test maintained by the Employer or a Controlled Group member and
the sum of the Average Actual Deferral Percentage and Average Contribution
Percentage of those Highly Compensated Employees subject to either or both
tests exceeds the Aggregate Limit, then the Contribution Percentage of those
Highly Compensated Employees who also participate in a cash or deferred
arrangement will be reduced (beginning with such Highly Compensated
Employees whose Contribution Percentage is the highest) so that the limit is
not exceeded. The amount by which each Highly Compensated Employee's
Contribution Percentage is reduced shall be treated as an Excess Aggregate
Contribution. The Average Actual Deferral Percentage and Average
Contribution Percentage of the Highly Compensated Employees are determined
after any corrections required to meet the Average Actual Deferral
Percentage and Average Contribution Percentage tests. Multiple use does not
occur if both the Average Actual Deferral Percentage and Average
Contribution Percentage of the Highly Compensated Employees does not exceed
1.25 multiplied by the Average Actual Deferral Percentage and Average
Contribution Percentage of the Nonhighly Compensated Employees.
The Contribution Percentage for any Eligible Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to have
Contribution Percentage Amounts allocated to his account under two or more
plans described in Code Section 401(a) or arrangements described in Code
Section 401(k) that are maintained by the Employer or a Controlled Group
member shall be determined as if the total of such Contribution Percentage
Amounts was made under each plan. If a Highly Compensated Employee
participates in two or more cash or deferred arrangements that have
different Plan Years, all cash or deferred arrangements ending with or
within the same calendar year shall be treated as a single arrangement.
Notwithstanding the foregoing, certain plans shall be treated as separate if
mandatorily disaggregated under the regulations under Code Section 401(m) or
permissibly disaggregated as provided.
In the event that this Plan satisfies the requirements of Code Sections
401(m), 401(a)(4), or 410(b) only if aggregated with one or more other
plans, or if one or more other plans satisfy the requirements of such Code
sections only if aggregated with this Plan, then this section shall be
applied by determining the Contribution Percentages of Eligible Participants
as if all such plans were a single plan. Plans may be aggregated in order to
satisfy Code Section 401(m) only if they have the same Plan Year.
For purposes of determining the Contribution Percentage of an Eligible
Participant who is a
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<PAGE>
five-percent owner or one of the ten most highly-paid Highly Compensated
Employees, the Contribution Percentage Amounts and Compensation of such
Participant shall include Contribution Percentage Amounts and Compensation
for the Plan Year of Family Members. Family Members, with respect to Highly
Compensated Employees, shall be disregarded as separate employees in
determining the Contribution Percentage both for employees who are Nonhighly
Compensated Employees and for employees who are Highly Compensated
Employees.
For purposes of determining the Contribution Percentage, Participant
Contributions are considered to have been made in the Plan Year in which
contributed to the Plan. Matching Contributions and Qualified Nonelective
Contributions will be considered made for a Plan Year if made no later than
the end of the 12-month period beginning on the day after the close of the
Plan Year.
The Employer shall maintain records sufficient to demonstrate satisfaction
of the Average Contribution Percentage test and the amount of Qualified
Nonelective Contributions or Qualified Matching Contributions, or both, used
in such test.
The determination and treatment of the Contribution Percentage of any
Participant shall satisfy such other requirements as may be prescribed by
the Secretary of the Treasury.
Notwithstanding any other provisions of this Plan, Excess Aggregate
Contributions, plus any income and minus any loss allocable thereto, shall
be foifeited, if not vested, or distributed, if vested, no later than the
last day of each Plan Year to Participants to whose Accounts such Excess
Aggregate Contributions were allocated for the preceding Plan Year. Excess
Aggregate Contributions of Participants who are subject to the family member
aggregation rules shall be allocated among the Family Members in proportion
to the Employee and Matching Contributions (or amounts treated as Matching
Contributions) of each Family Member that is combined to determine the
combined Contribution Percentage. If such Excess Aggregate Contributions are
distributed more than 2 1/2 months after the last day of the Plan Year in
which such excess amounts arose, a ten (10) percent excise tax will be
imposed on the employer maintaining the plan with respect to those amounts.
Excess Aggregate Contributions shall be treated as Annual Additions, as
defined in the CONTRIBUTION LIMITATION SECTION of Article III, under the
Plan.
The Excess Aggregate Contributions shall be adjusted for income or loss. The
income or loss allocable to such Excess Aggregate Contributions shall be
equal to the income or loss allocable to the Participant's Contribution
Percentage Amounts for the Plan Year in which the excess occurred multiplied
by a fraction. The numerator of the fraction is the Excess Aggregate
Contributions. The denominator of the fraction is the closing balance
without regard to any income or loss occurring during such Plan Year (as of
the end of such Plan Year) of the Participant's Account resulting from
Contribution Percentage Amounts.
Excess Aggregate Contributions shall be distributed from the Participant's
Account resulting from Participant Contributions that are not required as a
condition of employment or participation or for obtaining additional
benefits from Employer Contributions. If such Excess Aggregate Contributions
exceed the balance in the Participant's Account resulting from such
Participant Contributions, the balance shall be forfeited, if not vested,
or distributed, if vested, on a pro-rata basis from the Participant's
Account resulting from Contribution Percentage Amounts. These Forfeitures
shall be used to offset the earliest Employer Contribution due after the
Forfeiture arises.
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ARTICLE IV
INVESTMENT OF CONTRIBUTIONS
SECTION 4.01--INVESTMENT OF CONTRIBUTIONS.
All Contributions are forwarded by the Employer to the Trustee to be
deposited in the Trust Fund.
Investment of Contributions is governed by the provisions of the Trust, the
Group Contract and any other funding arrangement in which the Trust Fund is or
may be invested. To the extent permitted by the Trust, Group Contract or other
funding arrangement, the parties named below shall direct the Contributions to
any of the accounts available under the Trust or Group Contract and may request
the transfer of assets resulting from those Contributions between such accounts.
A Participant may not direct the Trustee to invest the Participant's Account in
collectibles. Collectibles means any work of art, rug or antique, metal or gem,
stamp or coin, alcoholic beverage or other tangible personal property specified
by the Secretary of Treasury. To the extent that a Participant does not direct
the investment of his Account, such Account shall be invested ratably in the
accounts available under the Trust or Group Contract in the same manner as the
undirected Accounts of all other Participants. The Vested Accounts of all
Inactive Participants may be segregated and invested separately from the
Accounts of all other Participants.
The Trust Fund shall be valued at current fair market value as of the last
day of the last calendar month ending in the Plan Year and, at the discretion of
the Trustee, may be valued more frequently. The valuation shall take into
consideration investment earnings credited, expenses charged, payments made and
changes in the value of the assets held in the Trust Fund. The Account of a
Participant shall be credited with its share of the gains and losses of the
Trust Fund. That part of a Participant's Account invested in a funding
arrangement which establishes an account or accounts for such Participant
thereunder shall be credited with the gain or loss from such account or
accounts. That part of a Participant's Account which is invested in other
funding arrangements shall be credited with a proportionate share of the gain or
loss of such investments. The share shall be determined by multiplying the gain
or loss of the investment by the ratio of the part of the Participant's Account
invested in such funding arrangement to the total of the Trust Fund invested in
such funding arrangement.
At least annually, the Named Fiduciary shall review all pertinent Employee
information and Plan data in order to establish the funding policy of the Plan
and to determine appropriate methods of carrying out the Plan's objectives. The
Named Fiduciary shall inform the Trustee and any Investment Manager of the
Plan's short-term and long-term financial needs so the investment policy can be
coordinated with the Plan's financial requirements.
a) Matching Contributions: One-half of all Matching Contributions
shall initially be invested in Qualifying Employer Securities and the
resulting whole and fractional shares of Qualifying Employer
Securities shall be allocated to the Accounts of the eligible
Participants. All or any portion of the shares of Qualifying Employer
Securities allocated to the Account of a Participant may be sold at the
direction of the Participant once during any calendar month in
accordance with such reasonable procedures as may be established from
time to time by the Plan Administrator, provided that only whole shares
of Qualifying Employer Securities may be sold and the value of any
fractional share shall be converted to cash. Participants shall not have
the right to acquire additional shares of Qualifying Employer Securities
under the Plan as an investment option.
b) Discretionary Contributions: The Participant shall direct the
investment of Discretionary Contributions and transfer of assets
resulting from those Contributions.
c) Elective Deferral Contributions: The Participant shall direct the
investment of Elective Deferral Contributions and transfer of assets
resulting from those Contributions.
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d) Rollover Contributions: The Participant shall direct the investment of
Rollover Contributions and transfer of assets resulting from those
Contributions.
However, the Named Fiduciary may delegate to the Investment Manager
investment discretion for Contributions and Plan assets which are not subject
to Participant direction.
SECTION 4.01A--INVESTMENT IN QUALIFYING EMPLOYER SECURITIES
The Trustee shall invest one half of the Employer Matching Contributions in
Qualifying Employer Securities, and both whole and fractional shares of
Qualifying Employer Securities shall be allocated to the Accounts of eligible
Participants.
If the securities of the Employer are not publicly traded and if no
market or an extremely thin market exists for the Qualifying Employer
Securities, so that a reasonable valuation may not be obtained from the
marketplace, then such Qualifying Employer Securities must be valued at least
annually by an independent appraiser who is not associated with the Employer,
the Plan Administrator, the Trustee, or any person related to any fiduciary
under the Plan. The independent appraiser may be associated with a person who is
merely a contract administrator with respect to the Plan, but who exercises no
discretionary authority and is not a Plan fiduciary.
For purposes of determining the annual valuation of the Plan and for
reporting to Participants and regulatory authorities, the assets of the Plan
shall be valued at least annually on the Valuation Date which corresponds to the
last day of the Plan Year. The fair market value of Qualifying Employer
Securities shall be determined on such a Valuation Date. The closing price on
the consolidated tape of Qualifying Employer Securities as of the date of the
transaction shall apply for purposes of valuing distributions and other
transactions of the Plan. For any other Plan valuation purposes, the procedures
described in this paragraph shall be utilized.
In the event that the Trustee acquires shares of Qualifying Employer
Securities by purchase from a "disqualified person" as defined in Code Section
4975(e)(2), in exchange for cash or other assets of the Trust, the terms of such
purchase shall contain the provision that in the event that there is a final
determination by the Internal Revenue Service or court of competent jurisdiction
that the fair market value of such shares of Qualifying Employer Security as of
the date of purchase was less than the purchase price paid by the Trustee, then
the seller shall pay or transfer, as the case may be, to the Trustee an amount
of cash, shares of Qualifying Employer Security, or any combination thereof
equal in value to the difference between the purchase price and said fair market
value for all such shares. In the event that cash and/or shares of Qualifying
Employer Security are paid and/or transferred to the Trustee under this
provision, shares of Qualifying Employer Security shall be valued at their fair
market value as of the date of said purchase, and interest at a reasonable rate
from the date of purchase to the date of payment shall be paid by the seller on
the amount of cash paid.
Pursuant to directions received from Participants, the Plan Administrator
may direct the Trustee to sell, resell or otherwise dispose of Qualifying
Employer Securities, provided that any such sales to any disqualified person,
including
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the Employer, will be made at not less than the fair market value and no
commission is charged. Any such sale shall be made in conformance with Section
408(e) of ERISA.
In the event the Trustee is directed to dispose of any Qualifying Employer
Securities held as Trust Assets under circumstances which require registration
and/or qualification of the securities under applicable Federal or state
securities laws, then the Employer, at its own expense, will take or cause to be
taken any and all such action as may be necessary or appropriate to effect such
registration and/or qualification.
Any dividends received by the Trustee with respect to shares of Qualifying
Employer Securities shall be used to acquire additional shares (including
fractional shares) of Qualifying Employer Securities for each Participant's
Account holding Qualifying Employer Securities.
SECTION 4.02--PURCHASE OF INSURANCE.
The purchase of life insurance is available under this Plan for the purpose
of providing incidental death benefits.
An Active Participant may elect to have any part of his Account which
results from Employer Contributions applied to purchase life insurance coverage
on his life.
The Trustee shall apply for and will be the owner of any Insurance Policy
purchase under the terms at this Plan. The purchase shall be subject to the
provisions of this section, the distribution of benefits provisions of
Article VI, and the beneficiary provisions of the BENEFICIARY SECTION of Article
IX. If the Participant has a spouse to whom he has been continuously married for
at least one year, such spouse shall be his Beneficiary under the Insurance
Policy on the Participant's life unless (a) a qualified election has been made
according to the provisions of the ELECTION PROCEDURES SECTION of Article VI or
(b) the Trustee has been named as Beneficiary. If the Trustee is named as
Beneficiary, upon the death of the Participant, the Trustee shall be required to
pay over all proceeds of the Insurance Policy to the Participant's
Beneficiary or spouse, as the case may be, according to the distribution of
benefits provisions of Article VI. Under no circumstances shall the Trust
retain any part of the proceeds. In the event of any conflict between the terms
of this Plan and the terms of any Insurance Policy purchased hereunder, the Plan
shall control.
The purchase of insurance shall be subject to the limitations that may be
imposed by the Insurer under the applicable Insurance Policy. The Insurance
Policy may provide for waiver of premium for disability and for substandard
extra insurance coverage if the insured is not a standard risk.
The total of all insurance premiums provided by Employer Contributions for a
Participant shall be limited to a percentage of all Employer Contributions made
for him. All such ordinary life insurance premiums shall be limited to a
percentage which is less than 50%. All such term life and universal life
insurance premiums shall be limited to a percentage which is not more than 25%.
If both ordinary life insurance and term life or universal life insurance is
purchased, 1/2 of all such ordinary life insurance premiums and all such other
life insurance premiums shall be limited to a percentage which is not more than
25%. Ordinary life insurance policies are policies with both nondecreasing death
benefits and nonincreasing premiums
Any dividends declared under an Insurance Policy for a Participant may,
within the terms of the Insurance Policy, be applied to reduce the earliest
premium due, purchase paid-up insurance coverage, accumulate under the policy to
provide additional death benefit or be credited to the Participant's Account
which is included in the Investment Fund. In the absence of any direction, such
dividends shall be applied to reduce the earliest premium due for such amount of
insurance.
A Participant may elect to have amounts deducted from his Account to pay
insurance premiums. The total amount deducted cannot exceed the amount of
Contributions credited to his Account which were not used to purchase insurance,
but could have been.
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If a decrease in the amount of life insurance is necessary, any cash values
of the terminated insurance shall be retained in the Participant's Account and
added to the Investment Fund.
SECTION 4.03--TRANSFER OF OWNERSHIP.
Any transfer of ownership under this section shall be subject to the
distribution of benefits provisions of Article VI.
Upon the request of a Participant, the Employer may purchase for its cash
value a personal life insurance policy issued to, and insuring the life of the
Participant. Such policy shall be immediately transferred from the Employer to
the Trustee. The cash value of the purchased policy shall be a part of the
Employer Contribution for the Plan Year. Any such purchase shall be accomplished
only under an appropriate written agreement between the Participant, the Trustee
and the Employer. In lieu of the Employer's purchase of such policy and at the
Employer's direction, the Trustee may purchase the policy directly from the
Participant. These provisions shall not be available if the policy is subject to
a policy loan or similar lien. The purchase of and future premiums for any such
policy shall be subject to the limitations in the PURCHASE OF INSURANCE SECTION
of Article IV.
If the Insurance Policy allows, a Participant may pay the Trustee an amount
equal to the cash values of any Insurance Policy for him. Such payment shall
become a part of his Account. Upon receiving the payment, the Trustee shall
transfer ownership of the policy to the Participant. This transfer of ownership
is not a distribution from the Plan. This option shall only be available to a
Participant if the policy would, but for the sale, be surrendered by the Plan.
If a distribution of a Participant's Vested Account would include the cash
values of an Insurance Policy for him, the Participant may have ownership of
such policy transferred to himself without making payment to the Trustee if
permitted by such Insurance Policy. Any Insurance Policy transferred to the
Participant for which he has not made payment to the Trustee is a distribution
from the Plan.
In applying the provisions of this section, all Participants in similar
circumstances shall be treated in a similar manner. Participants who are highly
compensated employees, as defined in Code Section 414(q), (officers,
shareholders or highly compensated Employees before the first Yearly Date after
December 31, 1988) shall not be treated in a manner more favorable than that
afforded all other Participants.
SECTION 4.04--TERMINATION OF INSURANCE.
The termination of insurance under this section shall be subject to the
distribution of benefits provisions of Article VI.
No premium payments shall be made under this Plan for an Inactive
Participant. If a Participant becomes an Inactive Participant before Retirement
Date, the Trustee may either use the cash values of the Insurance Policy for the
Participant to provide paid-up insurance or may surrender the Insurance Policy.
The cash values of a surrendered Insurance Policy are retained in the
Participant's Account and added to the Investment Fund. The purchase of paid-up
insurance shall be subject to the provisions of the Insurance Policy. If the
Participant ceases to be an Employee before Retirement Date, the Participant may
elect to have ownership of the Insurance Policy transferred as provided in the
TRANSFER OF OWNERSHIP SECTION of Article IV.
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On a Participant's Retirement Date, all or a part of any Insurance Policy
for him, the ownership of which has not been transferred to him, shall
terminate. The cash values shall be paid to the Participant in cash or applied
to provide an income for him according to the provisions of the Insurance
Policy. In any event, no portion of the value of any Insurance Policy shall be
used to continue life insurance protection under the Plan beyond actual
retirement.
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ARTICLE V
BENEFITS
SECTION 5.01--RETIREMENT BENEFITS.
On a Participant's Retirement Date, his Vested Account shall be distributed
to him according to the distribution of benefits provisions of Article VI and
the provisions of the SMALL AMOUNTS SECTION of Article IX.
SECTION 5.02--DEATH BENEFITS.
If a Participant dies before his Annuity Starting Date, his Vested Account
shall be distributed according to the distribution of benefits provisions of
Article VI and the provisions of the SMALL AMOUNTS SECTION of Article IX.
SECTION 5.03--VESTED BENEFITS.
A Participant may receive a distribution of his Vested Account at any time
after he ceases to be an Employee, provided he has not again become an Employee.
If such amount is not payable under the provisions of the SMALL AMOUNTS SECTION
of Article IX, it will be distributed only if the Participant so elects. The
Participant's election shall be subject to the requirements in the ELECTION
PROCEDURES SECTION of Article VI for a qualified election of a retirement
benefit.
If a Participant does not receive an earlier distribution according to the
provisions of this section or the SMALL AMOUNTS SECTION of Article IX, upon his
Retirement Date or death, his Vested Account shall be applied according to the
provisions of the RETIREMENT BENEFITS SECTION or the DEATH BENEFITS SECTION of
Article V.
The Nonvested Account of a Participant who has ceased to be an Employee
shall remain a part of his Account until it becomes a Forfeiture: provided,
however, if the Participant again becomes an Employee so that his Vesting
Percentage can increase, the Nonvested Account may become a part of his Vested
Account.
SECTION 5.04--WHEN BENEFITS START.
Benefits under the Plan begin when a Participant retires, dies or ceases to
be an Employee, whichever applies, as provided in the preceding sections of this
article. Benefits which begin before Normal Retirement Date for a Participant
who became Totally and Permanently Disabled when he was an Employee shall be
deemed to begin because he is Totally and Permanently Disabled. The start of
benefits is subject to the qualified election procedures of Article VI.
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Unless otherwise elected, benefits shall begin before the sixtieth day
following the close of the Plan Year in which the latest date below occurs:
a) The date the Participant attains age 65 or (Normal Retirement Age, if
earlier).
b) The tenth anniversary of the Participant's Entry Date.
c) The date the Participant ceases to be an Employee.
Notwithstanding the foregoing, the failure of a Participant and spouse to
consent to a distribution while a benefit is immediately distributable, within
the meaning of the ELECTION PROCEDURES SECTION of Article VI, shall be deemed
to be an election to defer commencement of payment of any benefit sufficient to
satisfy this section.
The Participant may elect to have his benefits begin after the latest date
for beginning benefits described above, subject to the provisions of this
section. The Participant shall make the election in writing and deliver the
signed statement of election to the Plan Administrator before Normal Retirement
Date or the date he ceases to be an Employee, if later. The election must
describe the form of distribution and the date the benefits will begin. The
Participant shall not elect a date for beginning benefits or a form of
distribution that would result in a benefit payable when he dies which would be
more than incidental within the meaning of governmental regulations.
Benefits shall begin by the Participant's Required Beginning Date, as
defined in the OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION REQUIREMENTS
SECTION of Article VI.
Contributions which are used to compute the Actual Deferral Percentage, as
defined in the EXCESS AMOUNTS SECTION of Article III, may be distributed upon
disposition by the Employer of substantially all of the assets (within the
meaning of Code Section 409(d)(2)) used by the Employer in a trade or business
or disposition by the Employer of the Employer's interest in a subsidiary
(within the meaning of Code Section 409(d)(3)) if the transferee corporation is
not a Controlled Group member, the Employee continues employment with the
transferee corporation and the transferor corporation continues to maintain the
Plan. Such distributions made after March 31, 1988, must be made in a single
sum.
SECTION 5.05--WITHDRAWAL PRIVILEGES.
A Participant who has attained age 59 1/2 may withdraw all or any portion of
his Vested Account which results from the following Contributions:
Elective Deferral Contributions
Matching Contributions
Discretionary Contributions
Rollover Contributions
A Participant may make such a withdrawal at any time.
A Participant may withdraw all or any portion of his Vested Account which
results from the following Contributions
Elective Deferral Contributions
Matching Contributions
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Discretionary Contributions
Rollover Contributions
in the event of hardship due to an immediate and heavy financial need.
Withdrawals from the Participant's Account resulting from Elective Deferral
Contributions shall be limited to the amount of the Participant's Elective
Deferral Contributions. Immediate and heavy financial need shall be limited to:
(i) expenses incurred or necessary for medical care, described in Code Section
213(d), of the Participant, the Participant's spouse, or any dependents of the
Participant (as defined in Code Section 152); (ii) purchase (excluding mortgage
payments) of a principal residence for the Participant; (iii) payment of tuition
and related educational fees and the payment of room and board expenses for the
next 12 months of post-secondary education for the Participant, his spouse,
children or dependents; (iv) the need to prevent the eviction of the Participant
from his principal residence or foreclosure on the mortgage of the Participant's
principal residence; or (v) any other distribution which is deemed by the
Commissioner of Internal Revenue to be made on account of immediate and heavy
financial need as provided in Treasury regulations. The Participant's request
for a withdrawal shall include his written statement that an immediate and heavy
financial need exists and explain its nature.
No withdrawal shall be allowed which is not necessary to satisfy such
immediate and heavy financial need. Such withdrawal shall be deemed necessary
only if all of the following requirements are met: (i) the distribution is not
in excess of the amount of the immediate and heavy financial need of the
Participant (including amounts necessary to pay any Federal, state or local
income taxes or penalties reasonably anticipated to result from the
distribution); (ii) the Participant has obtained all distributions, other than
hardship distributions, and all nontaxable loans currently available under all
plans maintained by the Employer; (iii) the Plan, and all other plans maintained
by the Employer, provide that the Participant's elective contributions and
employee contributions will be suspended for at least 12 months after receipt of
the hardship distributions; and (iv) the Plan, and all other plans maintained by
the Employer, provide that the Participant may not make elective contributions
for the Participant's taxable year immediately following the taxable year of the
hardship distribution in excess of the applicable limit under Code Section
402(g) for such next taxable year less the amount of such Participant's elective
contributions for the taxable year of the hardship distribution. The Plan will
suspend elective contributions and employee contributions for 12 months and
limit elective deferrals as provided in the preceding sentence. A Participant
shall not cease to be an Eligible Participant, as defined in the EXCESS AMOUNTS
SECTION of Article III, merely because his elective contributions or employee
contributions are suspended.
A request for withdrawal shall be in writing on a form furnished for that
purpose and delivered to the Plan Administrator before the withdrawal is to
occur. The Participant's request shall be subject to the requirements in the
ELECTION PROCEDURES SECTION of Article VI for a qualified election of a
retirement benefit payable in a form other than a Qualified Joint and Survivor
Form.
A forfeiture shall not occur solely as a result of a withdrawal.
SECTION 5.06--LOANS TO PARTICIPANTS.
Loans shall be made available to all Participants on a reasonably equivalent
basis. For purposes of this section, Participant means any Participant or
Beneficiary who is a party-in-interest, within the meaning of Section 3(14) of
the Employee Retirement Income Security Act of 1974. Loans shall not be made to
highly compensated employees, as defined in Code Section 414(q), in an amount
greater than the amount made available to other Participants.
No loans will be made to any shareholder-employee or owner-employee. For
purposes of this requirement, a shareholder-employee means an employee or
officer of an electing small business (Subchapter S) corporation
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who owns (or is considered as owning within the meaning of Code Section
318(a)(1)), on any day during the taxable year of such corporation, more than 5%
of the outstanding stock of the corporation.
A loan to a Participant shall be a Participant-directed investment of his
Account. No Account other than the borrowing Participant's Account shall share
in the interest paid on the loan or bear any expense or loss because of the
loan. The repayment of any loan will not be directed to the Participant's
Qualifying Employer Securities Account.
The number of outstanding loans shall be limited to one. The minimum amount
of any loan shall be $1,000.
Loans must be adequately secured and bear a reasonable rate of interest.
The amount of the loan shall not exceed the maximum amount that may be
treated as a loan under Code Section 72(p) (rather than a distribution) to the
Participant and shall be equal to the lesser of (a) or (b) below:
a) $50,000 reduced by the highest outstanding loan balance of loans during
the one-year period ending on the day before the new loan is made.
b) The greater of (1) or (2), reduced by (3) below:
1) One-half of the Participant's Vested Account.
2) $10,000.
3) Any outstanding loan balance on the date the new loan is made.
For purposes of this maximum, a Participant's Vested Account does not include
any accumulated deductible employee contributions, as defined in Code Section
72(o)(5)(B), and all qualified employer plans, as defined in Code Section
72(p)(4), of the Employer and any Controlled Group member shall be treated as
one plan.
The foregoing notwithstanding, the amount of such loan shall not exceed 50%
of the amount of the Participant's Vested Account. For purposes of this maximum,
a Participant's Vested Account does not include any accumulated deductible
employee contributions, as defined in Code Section 72(o)(5)(B). No collateral
other than a portion of the Participant's Vested Account (as limited above)
shall be accepted. The Loan Administrator shall determine if the collateral is
adequate for the amount of the loan requested.
A Participant must obtain the consent of the Participant's spouse, if any,
to the use of the Vested Account as security for the loan. Spousal consent shall
be obtained no earlier than the beginning of the 90-day period that ends on the
date on which the loan to be so secured is made. The consent must be in writing,
must acknowledge the effect of the loan, and must be witnessed by a plan
representative or a notary public. Such consent shall thereafter be binding with
respect to that loan. A new consent shall be required if the Vested Account is
used for collateral upon renegotiation, extension, renewal, or other revision of
the loan.
If a valid spousal consent has been obtained in accordance with the above,
then, notwithstanding any other provision of this Plan, the portion of the
Participant's Vested Account used as a security interest held by the Plan by
reason of a loan outstanding to the Participant shall be taken into account for
purposes of determining the amount of the Vested Account payable at the time of
death or distribution, but only if the reduction is used as repayment of the
loan. If less than 100% of the Participant's Vested Account (determined without
regard to the preceding sentence) is payable to the surviving spouse, then the
Vested Account shall be adjusted by first reducing the Vested Account by the
amount of the security used as repayment of the loan, and then determining
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the benefit payable to the surviving spouse.
Each loan shall bear a reasonable fixed rate of interest to be determined by
the Loan Administrator. In determining the interest rate, the Loan Administrator
shall take into consideration fixed interest rates currently being charged by
commercial lenders for loans of comparable risk on similar terms and for similar
durations, so that the interest will provide for a return commensurate with
rates currently charged by commercial lenders for loans made under similar
circumstances. The Loan Administrator shall not discriminate among the
Participants in the matter of interest rates in accordance with the current
appropriate standards.
The loan shall by its terms require that repayment (principal and interest)
be amortized in level payments, not less frequently than quarterly, over a
period not extending beyond five years from the date of the loan. The period of
repayment for any loan shall be arrived at by mutual agreement between the Loan
Administrator and the Participant.
The Participant shall make a written application for a loan from the Plan on
forms provided by the Loan Administrator. The application must specify the
amount and duration requested. No loan will be approved unless the Participant
is creditworthy. The Participant must grant authority to the Loan Administrator
to investigate the Participant's creditworthiness so that the loan application
may be properly considered.
Information contained in the application for the loan concerning the income,
liabilities, and assets of the Participant will be evaluated to determine
whether there is a reasonable expectation that the Participant will be able to
satisfy payments on the loan as due. Additionally. the Loan Administrator will
pursue any appropriate further investigations concerning the creditworthiness
and/or credit history of the Participant to determine whether a loan should be
approved.
Each loan shall be fully documented in the form of a promissory note signed
by the Participant for the face amount of the loan, together with interest
determined as specified above.
There will be an assignment of collateral to the Plan executed at the time
the loan is made.
In those cases where repayment through payroll deduction by the Employer is
available, installments are so payable, and a payroll deduction agreement will
be executed by the Participant at the time of making the loan.
Where payroll deduction is not available, payments are to be timely made.
Any payment that is not by payroll deduction shall be made payable to the
Employer or Trustee, as specified in the promissory note, and delivered to the
Loan Administrator, including prepayments and penalties, if any, and other
amounts due under the note.
The promissory note may provide for reasonable late payment penalties and/or
service fees. Any penalties or service fees shall be applied to all Participants
in a nondiscriminatory manner. If the promissory note so provides, such amounts
may be assessed and collected from the Account of the Participant as part of the
loan balance.
Each loan may be paid prior to maturity, in part or in full, without penalty
or service fee, except as may be set out in the promissory note.
If any amount remains unpaid for more than 31 days after due, a default is
deemed to occur.
Upon default, the Plan has the right to pursue any remedy available by law
to satisfy the amount due, along
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with accrued interest, including the right to enforce its claim against the
security pledged and execute upon the collateral as allowed by law.
If any payment of principal or interest or penalty, or any portion thereof,
is not made for a period of 90 days after due, the entire principal balance
whether or not otherwise then due, shall become immediately due and payable
without demand or notice, and subject to collection or satisfaction by any
lawful means, including specifically but not limited to the right to enforce the
claim against the security pledged and to execute upon the collateral as allowed
by law.
In the event of default, foreclosure on the note and attachment of security
or use of amounts pledged to satisfy the amount then due, will not occur until a
distributable event occurs in accordance with the Plan, and will not occur to an
extent greater than the amount then available upon any distributable event which
has occurred under the Plan.
All reasonable costs and expenses, including but not limited to attorney's
fees, incurred by the Plan in connection with any default or in any proceeding
to enforce any provision of a promissory note or instrument by which a
promissory note for a Participant loan is secured, shall be assessed and
collected from the Account of the Participant as part of the loan balance.
If payroll deduction is being utilized, in the event that a Participant's
available payroll deduction amounts in any given month are insufficient to
satisfy the total amount due, there will be an increase in the amount taken
subsequently, sufficient to make up the amount that is then due. If the
subsequent deduction is also insufficient to satisfy the amount due within 31
days, a default is deemed to occur as above. If any amount remains past due
more than 90 days, the entire principal amount, whether or not otherwise then
due, along with interest then accrued and any penalty amount then due, shall
become due and payable, as above.
If the Participant ceases to be a party-in-interest (as defined in this
section), the balance of the outstanding loan becomes due and payable, and the
Participant's Vested Account will be used as available for distribution(s) to
pay the outstanding loan. The Participant's Vested Account will not be used to
pay any amount due under the outstanding loan before the date which is 31 days
after the date he ceased to be an Employee, and the Participant may elect to
repay the outstanding loan with interest on the day of repayment. If no
distributable event has occurred under the Plan at the time that the
Participant's Vested Account would otherwise be used under this provision to pay
any amount due under the outstanding loan, this will not occur until the time,
or in excess of the extent to which, a distributable event occurs under the
Plan.
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ARTICLE VI
DISTRIBUTION OF BENEFITS
SECTION 6.01--AUTOMATIC FORMS OF DISTRIBUTION.
Unless a qualified election of an optional farm of benefit has been made
within the election period (see the ELECTION PROCEDURES SECTION of Article VI),
the automatic form of benefit payable to or on behalf of a Participant is
determined as follows:
a) The automatic form of retirement benefit for a Participant who does not
die before his Annuity Starting Date shall be the Qualified Joint and
Survivor Form.
b) The automatic form of death benefit for a Participant who dies before
his Annuity Starting Date shall be:
1) A Qualified Preretirement Survivor Annuity for a Participant who has
a spouse to whom he has been continuously married throughout the
one-year period ending on the date of his death. The spouse may
elect to start receiving the death benefit on any first day of the
month on or after the Participant dies and before the date the
Participant would have been age 70 1/2. If the spouse dies before
benefits start, the Participant's Vested Account, determined as of
the date of the spouse's death, shall be paid to the spouse's
Beneficiary.
2) A single-sum payment to the Participant's Beneficiary for a
Participant who does not have a spouse who is entitled to a
Qualified Preretirement Survivor Annuity.
Before a death benefit will be paid on account of the death of a
Participant who does not have a spouse who is entitled to a Qualified
Preretirement Survivor Annuity, it must be established to the
satisfaction of a plan representative that the Participant does not have
such a spouse.
SECTION 6.02--OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION REQUIREMENTS.
a) For purposes of this section, the following terms are defined:
Applicable Life Expectancy means Life Expectancy (or Joint and Last
--------------------------
Survivor Expectancy) calculated using the attained age of the
Participant (or Designated Beneficiary) as of the Participant's (or
Designated Beneficiary's) birthday in the applicable calendar year
reduced by one for each calendar year which has elapsed since the date
Life Expectancy was first calculated. If Life Expectancy is being
recalculated, the Applicable Life Expectancy shall be the Life
Expectancy so recalculated. The applicable calendar year shall be the
first Distribution Calendar Year, and if Life Expectancy is being
recalculated such succeeding calendar.
Designated Beneficiary means the individual who is designated as the
----------------------
beneficiary under the Plan in accordance with Code Section 401(a)(9) and
the regulations thereunder.
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Distribution Calendar Year means a calendar year for which a minimum
--------------------------
distribution is required. For distributions beginning before the
Participant's death, the first Distribution Calendar Year is the
calendar year immediately preceding the calendar year which contains the
Participant's Required Beginning Date. For distributions beginning after
the Participant's death, the first Distribution Calendar Year is the
calendar year in which distributions are required to begin pursuant to
(e) below.
Joint and Last Survivor Expectancy means joint and last survivor
----------------------------------
expectancy computed by use of the expected return multiples in Table VI
of section 1.72-9 of the Income Tax Regulations.
Unless otherwise elected by the Participant (or spouse, in the case of
distributions described in (e)(2)(ii) below) by the time distributions
are required to begin, life expectancies shall be recalculated annually.
Such election shall be irrevocable as to the Participant (or spouse) and
shall apply to all subsequent years. The life expectancy of a nonspouse
Beneficiary may not be recalculated.
Life Expectancy means life expectancy computed by use of the expected
---------------
return multiples in Tables V of section 1.72-9 of the Income Tax
Regulations.
Unless otherwise elected by the Participant (or spouse, in the case of
distributions described in (e)(2)(ii) below) by the time distributions
are required to begin, life expectancies shall be recalculated annually.
Such election shall be irrevocable as to the Participant (or spouse) and
shall apply to all subsequent years. The life expectancy of a nonspouse
Beneficiary may not be recalculated.
Participant's Benefit means
---------------------
1) The Account Balance as of the last valuation date in the calendar
year immediately preceding the Distribution Calendar Year (valuation
calendar year) increased by the amount of any contributions or
forfeitures allocated to the Account balance as of the dates in the
valuation calendar year after the valuation date and decreased by
distributions made in the valuation calendar year after the
valuation date.
2) For purposes of (1) above, if any portion of the minimum
distribution for the first Distribution Calendar Year is made in the
second Distribution Calendar Year on or before the Required
Beginning Date, the amount of the minimum distribution made in the
second Distribution Calendar Year shall be treated as if it had been
made in the immediately preceding Distribution Calendar Year.
Required Beginning Date means, for a Participant, the first day of April
-----------------------
of the calendar year following the calendar year in which the
Participant attains age 70 1/2, unless otherwise provided in
(1),(2)or(3) below:
1) The Required Beginning Date for a Participant who attains age 70 1/2
before January 1, 1988, and who is not a 5-percent owner is the
first day of April of the calendar year following the calendar year
in which the later of retirement or attainment of age 70 1/2 occurs.
2) The Required Beginning Date for a Participant who attains age 70 1/2
before January 1, 1988, and who is a 5-percent owner is the first
day of April of the calendar year following the later of
i) the calendar year in which the Participant attains age 70 1/2,
or
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ii) the earlier of the calendar year with or within which ends the
Plan Year in which the Participant becomes a 5-percent owner, or
the calendar year in which the Participant retires.
3) The Required Beginning Date of a Participant who is not a 5-percent
owner and who attains age 70 1/2 during 1988 and who has not retired
as of January 1, 1989, is April 1, 1990.
A Participant is treated as a 5-percent owner for purposes of this
section if such Participant is a 5-percent owner as defined in Code
Section 416(i) (determined in accordance with Code Section 416 but
without regard to whether the Plan is top-heavy) at any time during the
Plan Year ending with or within the calendar year in which such owner
attains age 66 1/2 or any subsequent Plan Year.
Once distributions have begun to a 5-percent owner under this section,
they must continue to be distributed, even if the Participant ceases to
be a 5-percent owner in a subsequent year.
b) The optional forms of retirement benefit shall he the following: a
straight life annuity; single life annuities with certain periods of
five, ten or fifteen years; a single life annuity with installment
refund; survivorship life annuities with installment refund and
survivorship percentages of 50, 66 2/3 or 100; fixed period annuities
for any period of whole months which is not less than 60 and does not
exceed the Life Expectancy of the Participant and the named Beneficiary
as provided in (d) below where the Life Expectancy is not recalculated;
and a series of installments chosen by the Participant with a minimum
payment each year beginning with the year the Participant turns age 70
1/2. The payment for the first year in which a minimum payment is
required will be made by April 1 of the following calendar year. The
payment for the second year and each successive year will be made by
December 31 of that year. The minimum payment will be based on a period
equal to the Joint and Last Survivor Expectancy of the Participant and
the Participant's spouse, if any, as provided in (d) below where the
Joint and Last Survivor Expectancy is recalculated. The balance of the
Participant's Vested Account, if any, will be payable on the
Participant's death to his Beneficiary in a single sum. The Participant
may also elect to receive his Vested Account in a single-sum payment;
or, in the form of Qualifying Employer Securities to the extent that his
Vested Account was held in Qualifying Employer Securities; or, in any
combination thereof. Fractional shares shall be paid in cash, valued as
of the most recent Valuation Date; the distribution shall include any
dividends (cash or stock) on such whole shares or any additional shares
received as a result of a stock split or any other adjustment to such
whole shares since the Valuation Date preceding the date of
distribution.
Election of an optional form is subject to the qualified election
provisions of Article VI.
Any annuity contract distributed shall be nontransferable. The terms of
any annuity contract purchased and distributed by the Plan to a
Participant or spouse shall comply with the requirements of this Plan.
c) The optional forms of death benefit are a single-sum payment and any
annuity that is an optional form of retirement benefit. However, a
series of installments shall not be available if the Beneficiary is not
the spouse of the deceased Participant.
d) Subject to the AUTOMATIC FORMS OF DISTRIBUTION SECTION of Article VI,
joint and survivor annuity requirements, the requirements of this
section shall apply to any distribution of a Participant's interest and
will take precedence over any inconsistent provisions of this Plan.
Unless otherwise specified, the provisions of this section apply to
calendar years beginning after December 31, 1984.
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All distributions required under this section shall be determined and
made in accordance with the proposed regulations under Code Section
401(a)(9), including the minimum distribution incidental benefit
requirement of section 1.401(a)(9)-2 of the proposed regulations.
The entire interest or a Participant must be distributed or begin to be
distributed no later than the Participant's Required Beginning Date.
As of the first Distribution Calendar Year, distributions, if not made
in a single sum, may only be made over one of the following periods (or
combination thereof):
1) the life of the Participant,
2) the life of the Participant and a Designated Beneficiary,
3) a period certain not extending beyond the Life Expectancy of the
Participant, or
4) a period certain not extending beyond the Joint and Last Survivor
Expectancy of the Participant and a Designated Beneficiary.
If the Participant's interest is to be distributed in other than a
single sum, the following minimum distribution rules shall apply on or
after the Required Beginning Date:
5) Individual account:
i) If a Participant's Benefit is to be distributed over
a) a period not extending beyond the Life Expectancy of the
Participant or the Joint Life and Last Survivor Expectancy
of the Participant and the Participant's Designated
Beneficiary or
b) a period not extending beyond the Life Expectancy of the
Designated Beneficiary,
the amount required to be distributed for each calendar year
beginning with the distributions for the first Distribution
Calendar Year, must be at least equal to the quotient obtained
by dividing the Participant's Benefit by the Applicable Life
Expectancy.
ii) For calendar years beginning before January 1, 1989, if the
Participant's spouse is not the Designated Beneficiary, the
method of distribution selected must assure that at least 50%
of the present value of the amount available for distribution
is paid within the Life Expectancy of the Participant.
iii) For calendar years beginning after December 31, 1988, the
amount to be distributed each year, beginning with
distributions for the first Distribution Calendar Year shall
not be less than the quotient obtained by dividing the
Participant's Benefit by the lesser of
a) the Applicable Life Expectancy or
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b) if the Participant's spouse is not the Designated
Beneficiary, the applicable divisor determined from the
table set forth in Q&A-4 of section 1.401(a)(9)-2 of the
proposed regulations.
Distributions after the death of the Participant shall be
distributed using the Applicable Life Expectancy in (5)(i) above
as the relevant divisor without regard to proposed regulations
section 1.401(a)(9)-2.
iv) The minimum distribution required for the Participant's first
Distribution Calendar Year must be made on or before the
Participant's Required Beginning Date. The minimum distribution
for the Distribution Calendar Year for other calendar years,
including the minimum distribution for the Distribution Calendar
Year in which the Participant's Required Beginning Date occurs,
must be made on or before December 31 of that Distribution
Calendar Year.
6) Other forms:
i) If the Participant's Benefit is distributed in the form of an
annuity purchased from an insurance company, distributions
thereunder shall be made in accordance with the requirements of
Code Section 401(a)(9) and the proposed regulations thereunder.
e) Death distribution provisions:
1) Distribution beginning before death. If the Participant dies after
distribution of his interest has begun, the remaining portion of
such interest will continue to be distributed at least as rapidly as
under the method of distribution being used prior to the
Participant's death.
2) Distribution beginning after death. If the Participant dies before
distribution of his interest begins, distribution of the
Participant's entire interest shall be completed by December 31 of
the calendar year containing the fifth anniversary of the
Participant's death except to the extent that an election is made to
receive distributions in accordance with (i) or (ii) below:
i) if any portion of the Participant's interest is payable to a
Designated Beneficiary, distributions may be made over the life
or over a period certain not greater than the Life Expectancy of
the Designated Beneficiary commencing on or before December 31
of the calendar year immediately following the calendar year in
which the Participant died;
ii) if the Designated Beneficiary is the Participant's surviving
spouse, the date distributions are required to begin in
accordance with (i) above shall not be earlier than the later of
a) December 31 of the calendar year immediately following the
calendar year in which the Participant died and
b) December 31 of the calendar year in which the Participant
would have attained age 70 1/2.
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If the Participant has not made an election pursuant to this (e)(2)
by the time of his death, the Participant's Designated Beneficiary
must elect the method of distribution no later than the earlier of
iii) December 31 of the calendar year in which distributions would
be required to begin under this subparagraph, or
iv) December 31 of the calendar year which contains the fifth
anniversary of the date of death of the Participant.
If the Participant has no Designated Beneficiary, or if the
Designated Beneficiary does not elect a method of distribution,
distribution of the Participant's entire interest must be completed
by December 31 of the calendar year containing the fifth anniversary
of the Participant's death.
3) For purposes of (e)(2) above, if the surviving spouse dies after the
Participant, but before payments to such spouse begin, the
provisions of (e)(2) above, with the exception of (e)(2)(ii)
therein, shall be applied as if the surviving spouse were the
Participant.
4) For purposes of this (e), any amount paid to a child of the
Participant will be treated as if it had been paid to the surviving
spouse if the amount becomes payable to the surviving spouse when
the child reaches the age of majority.
5) For purposes of this (e), distribution of a Participant's interest
is considered to begin on the Participant's Required Beginning Date
(or if (e)(3) above is applicable, the date distribution is required
to begin to the surviving spouse pursuant to (e)(2) above). If
distribution in the form of an annuity irrevocably commences to the
Participant before the Required Beginning Date, the date
distribution is considered to begin is the date distribution
actually commences.
SECTION 6.03--ELECTION PROCEDURES.
The Participant, Beneficiary, or spouse shall make any election under this
section in writing. The Plan Administrator may require such individual to
complete and sign any necessary documents as to the provisions to be made. Any
election permitted under (a) and (b) below shall be subject to the qualified
election provisions of (c) below.
a) Retirement Benefits. A Participant may elect his Beneficiary or
Contingent Annuitant and may elect to have retirement benefits
distributed under any of the optional forms of retirement benefit
described in the OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION
REQUIREMENTS SECTION of Article VI.
b) Death Benefits. A Participant may elect his Beneficiary and may elect to
have death benefits distributed under any of the optional forms of death
benefit described in the OPTIONAL FORMS OF DISTRIBUTION AND DISTRIBUTION
REQUIREMENTS SECTION of Article VI.
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If the Participant has not elected an optional form of distribution for
the death benefit payable to his Beneficiary, the Beneficiary may, for
his own benefit, elect the form of distribution, in like manner as a
Participant.
The Participant may waive the Qualified Preretirement Survivor Annuity
by naming someone other than his spouse as Beneficiary.
In lieu of the Qualified Preretirement Survivor Annuity described in the
AUTOMATIC FORMS OF DISTRIBUTION SECTION of Article VI, the spouse may,
for his own benefit, waive the Qualified Preretirement Survivor Annuity
by electing to have the benefit distributed under any of the optional
forms of death benefit described in the OPTIONAL FORMS OF DISTRIBUTION
AND DISTRIBUTION REQUIREMENTS SECTION of Article VI.
c) Qualified Election. The Participant, Beneficiary or spouse may make an
election at any time during the election period. The Participant,
Beneficiary, or spouse may revoke the election made (or make a new
election) at any time and any number of times during the election
period. An election is effective only if it meets the consent
requirements below.
The election period as to retirement benefits is the 90-day period
ending on the Annuity Starting Date. An election to waive the Qualified
Joint and Survivor Form may not be made before the date he is provided
with the notice of the ability to waive the Qualified Joint and Survivor
Form. If the Participant elects the series of installments, he may elect
on any later date to have the balance of his Vested Account paid under
any of the optional forms of retirement benefit available under the
Plan. His election period for this election is the 90-day period ending
on the Annuity Starting Date for the optional form of retirement benefit
elected.
A Participant may make an election as to death benefits at any time
before he dies. The spouse's election period begins on the date the
Participant dies and ends on the date benefits begin. The Beneficiary's
election period begins on the date the Participant dies and ends on the
date benefits begin. An election to waive the Qualified Preretirement
Survivor Annuity may not be made by the Participant before the date he
is provided with the notice of the ability to waive the Qualified
Preretirement Survivor Annuity. A Participant's election to waive the
Qualified Preretirement Survivor Annuity which is made before the first
day of the Plan Year in which he reaches age 35 shall become invalid on
such date. An election made by a Participant after he ceases to be an
Employee will not become invalid on the first day of the Plan Year in
which he reaches age 35 with respect to death benefits from that part of
his Account resulting from Contributions made before he ceased to be an
Employee.
If the Participant's Vested Account has at any time exceeded $3,500, any
benefit which is (1) immediately distributable or (2) payable in a form
other than a Qualified Joint and Survivor Form or a Qualified
Preretirement Survivor Annuity requires the consent of the Participant
and the Participant's spouse (or where either the Participant or spouse
has died, the survivor). The consent of the Participant or spouse to a
benefit which is immediately distributable must not be made before the
date the Participant or spouse is provided with the notice of the
ability to defer the distribution. Such consent shall be made in
writing. The consent shall not be made more than 90 days before the
Annuity Starting Date. Spousal consent is not required for a benefit
which is immediately distributable in a Qualified Joint and Survivor
Form. Furthermore, if spousal consent is not required because the
Participant is electing an optional form of retirement benefit that is
not a life annuity pursuant to (d) below, only the Participant need
consent to the distribution of a benefit payable in a
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form that is not a life annuity and which is immediately distributable.
Neither the consent of the Participant nor the Participant's spouse
shall be required to the extent that a distribution is required to
satisfy Code Section 401(a)(9) or Code Section 415. In addition, upon
termination of this Plan if the Plan does not offer an annuity option
(purchased from a commercial provider), the Participant's Account
balance may, without the Participant's consent, be distributed to the
Participant or transferred to another defined contribution plan (other
than an employee stock ownership plan as defined in Code Section
4975(e)(7)) within the same Controlled Group. A benefit is immediately
distributable if any part of the benefit could be distributed to the
Participant (or surviving spouse) before the Participant attains (or
would have attained if not deceased) the older of Normal Retirement Age
or age 62. If the Qualified Joint and Survivor Form is waived, the
spouse has the right to consent only to a specific Beneficiary or a
specific form of benefit. The spouse can relinquish one or both such
rights. Such consent shall be made in writing. The consent shall not be
made more than 90 days before the Annuity Starting Date. If the
Qualified Preretirement Survivor Annuity is waived, the spouse has the
right to limit consent only to a specific Beneficiary. Such consent
shall be in writing. The spouse's consent shall be witnessed by a plan
representative or notary public. The spouse's consent must acknowledge
the effect of the election, including that the spouse had the right to
limit consent only to a specific Beneficiary or a specific form of
benefit, if applicable, and that the relinquishment of one or both such
rights was voluntary. Unless the consent of the spouse expressly permits
designations by the Participant without a requirement of further
consent by the spouse, the spouse's consent must be limited to the form
of benefit if applicable, and the Beneficiary (including any Contingent
Annuitant), class of Beneficiaries, or contingent Beneficiary named in
the election. Spousal consent is not required, however, if the
Participant establishes to the satisfaction of the plan representative
that the consent of the spouse cannot be obtained because there is no
spouse or the spouse cannot be located. A spouse's consent under this
paragraph shall not be valid with respect to any other spouse. A
Participant may revoke a prior election without the consent of the
spouse. Any new election will require a new spousal consent, unless the
consent of the spouse expressly permits such election by the Participant
without further consent by the spouse. A spouse's consent may be revoked
at any time within the Participant's election period.
d) Special Rule for Profit Sharing Plan. As provided in the preceding
provisions of the Plan, if a Participant has a spouse to whom he has
been continuously married throughout the one-year period ending on the
date of his death, the Participant's Vested Account, including the
proceeds payable under any Insurance Policy on the Participant's life,
shall be paid to such spouse. However, if there is no such spouse or if
the surviving spouse has already consented in a manner conforming to the
qualified election requirements in (c) above, the Vested Account shall
be payable to the Participant's Beneficiary in the event of the
Participant's death.
The Participant may waive the spousal death benefit described above at
any time provided that no such waiver shall be effective unless it
satisfies the conditions of (c) above (other than the notification
requirement referred to therein) that would apply to the Participant's
waiver of the Qualified Preretirement Survivor Annuity.
Because this is a profit sharing plan which pays death benefits as
described above, this subsection (d) applies if the following condition
is met: with respect to the Participant, this Plan is not a direct or
indirect transferee after December 31, 1984, of a defined benefit plan,
money purchase plan (including a target plan), stock bonus plan or
profit sharing plan which is subject to the survivor annuity
requirements of Code Section 401(a)(11) and Code Section 417. If the
above condition is met, spousal consent is not required for electing a
benefit payable in a form that is not a life annuity. If the above
condition is not met, the consent requirements of this article shall be
operative.
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SECTION 6.04--NOTICE REQUIREMENTS.
a) Optional forms of retirement benefit. The Plan Administrator shall
furnish to the Participant and the Participant's spouse a written
explanation of the optional forms of retirement benefit in the OPTIONAL
FORMS OF DISTRIBUTION AND DISTRIBUTION REQUIREMENTS SECTION of Article
VI, including the material features and relative values of these
options, in a manner that would satisfy the notice requirements of Code
Section 417(a)(3) and the right of the Participant and the Participant's
spouse to defer distribution until the benefit is no longer immediately
distributable. The Plan Administrator shall furnish the written
explanation by a method reasonably calculated to reach the attention of
the Participant and the Participant's spouse no less than 30 days and no
more than 90 days before the Annuity Starting Date.
b) Qualified Joint and Survivor Form. The Plan Administrator shall furnish
to the Participant a written explanation of the following: the terms and
conditions of the Qualified Joint and Survivor Form; the Participant's
right to make, and the effect of, an election to waive the Qualified
Joint and Survivor Form; the rights of the Participant's spouse; and the
right to revoke an election and the effect of such a revocation. The
Plan Administrator shall furnish the written explanation by a method
reasonably calculated to reach the attention of the Participant no less
than 30 days and no more than 90 days before the Annuity Starting Date.
After the written explanation is given, a Participant or spouse may make
written request for additional information. The written explanation must
be personally delivered or mailed (first class mail, postage prepaid) to
the Participant or spouse within 30 days from the date of the written
request. The Plan Administrator does not need to comply with more than
one such request by a Participant or spouse.
The Plan Administrator's explanation shall be written in nontechnical
language and will explain the terms and conditions of the Qualified
Joint and Survivor Form and the financial effect upon the Participant's
benefit (in terms of dollars per benefit payment) of electing not to
have benefits distributed in accordance with the Qualified Joint and
Survivor Form.
c) Qualified Preretirement Survivor Annuity. As required by the Code and
Federal regulation, the Plan Administrator shall furnish to the
Participant a written explanation of the following: the terms and
conditions of the Qualified Preretirement Survivor Annuity; the
Participant's right to make, and the effect of, an election to waive the
Qualified Preretirement Survivor Annuity; the rights of the
Participant's spouse; and the right to revoke an election and the effect
of such a revocation. The Plan Administrator shall furnish the written
explanation by a method reasonably calculated to reach the attention of
the Participant within the applicable period. The applicable period for
a Participant is whichever of the following periods ends last:
1) the period beginning one year before the date the individual becomes
a Participant and ending one year after such date; or
2) the period beginning one year before the date the Participant's
spouse is first entitled to a Qualified Preretirement Survivor
Annuity and ending one year after such date.
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If such notice is given before the period beginning with the first
day of the Plan Year in which the Participant attains age 32 and
ending with the close of the Plan Year preceding the Plan Year in
which the Participant attains age 35, an additional notice shall be
given within such period. If a Participant ceases to be an Employee
before attaining age 35, an additional notice shall be given within
the period beginning one year before the date he ceases to be an
Employee and ending one year after such date.
After the written explanation is given, a Participant or spouse may
make written request for additional information. The written
explanation must be personally delivered or mailed (first class
mail, postage prepaid) to the Participant or spouse within 30 days
from the date of the written request. The Plan Administrator does
not need to comply with more than one such request by a Participant
or spouse.
The Plan Administrator's explanation shall be written in
nontechnical language and will explain the terms and conditions of
the Qualified Preretirement Survivor Annuity and the financial
effect upon the spouse's benefit (in terms of dollars per benefit
payment) of electing not to have benefits distributed in accordance
with the Qualified Preretirement Survivor Annuity.
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ARTICLE VII
TERMINATION OF PLAN
The Employer expects to continue the Plan indefinitely but reserves the
right to terminate the Plan in whole or in part at any time upon giving written
notice to all parties concerned. Complete discontinuance of Contributions under
the Plan constitutes complete termination of Plan.
The Account of each Participant shall be fully (100%) vested and
nonforfeitable as of the effective date of complete termination of Plan The
Account of each Participant who is included in the group of Participants deemed
to be affected by the partial termination of the Plan shall be fully (100%)
vested and nonforfeitable as of the effective date of the partial Plan
termination. The Participant's Account shall continue to participate in the
earnings credited, expenses charged and any appreciation or depreciation of the
Investment Fund until the Vested Account is distributed. A distribution under
this article will be a retirement benefit and shall be distributed to the
Participant according to the provisions of Article VI.
A Participant's Account which does not result from Contributions which are
used to compute the Actual Deferral Percentage, as defined in the EXCESS AMOUNTS
SECTION of Article III, may be distributed to the Participant after the
effective date of the complete or partial Plan termination. A Participant's
Account resulting from Contributions which are used to compute such percentage
may be distributed upon termination of the Plan without the establishment or
maintenance of another defined contribution plan, other than an employee stock
ownership plan (as defined in Code Section 4975(e) or Code Section 409) or a
simplified employee pension plan (as defined in Code Section 408(k)). Such a
distribution made after March 31, 1988, must be in a single sum.
Upon complete termination of Plan, no more Employees shall become
Participants and no more Contributions shall be made.
The assets of this Plan shall not be paid to the Employer at any time,
except that, after the satisfaction of all liabilities under the Plan, any
assets remaining may be paid to the Employer. The payment may not be made if it
would contravene any provision of law.
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ARTICLE VIII
ADMINISTRATION OF PLAN
SECTION 8.01 --ADMINISTRATION.
Subject to the provisions of this article, the Plan Administrator has
complete control of the administration of the Plan. The Plan Administrator has
all the powers necessary for it to properly carry out its administrative duties.
Not in limitation, but in amplification of the foregoing, the Plan Administrator
has the power to construe the Plan, including ambiguous provisions, and to
determine all questions that may arise under the Plan, including all questions
relating to the eligibility of Employees to participate in the Plan and the
amount of benefit to which any Participant, Beneficiary, spouse or Contingent
Annuitant may become entitled. The Plan Administrator's decisions upon all
matters within the scope of its authority shall be final.
Unless otherwise set out in the Plan or Group Contract, the Plan
Administrator may delegate recordkeeping and other duties which are necessary
for the administration of the Plan to any person or firm which agrees to accept
such duties. The Plan Administrator shall be entitled to rely upon all tables,
valuations, certificates and reports furnished by the consultant or actuary
appointed by the Plan Administrator and upon all opinions given by any counsel
selected or approved by the Plan Administrator.
The Plan Administrator shall receive all claims for benefits by
Participants, former Participants, Beneficiaries, spouses, and Contingent
Annuitants. The Plan Administrator shall determine all facts necessary to
establish the right of any Claimant to benefits and the amount of those benefits
under the provisions of the Plan. The Plan Administrator may establish rules and
procedures to be followed by Claimants in filing claims for benefits, in
furnishing and verifying proofs necessary to determine age, and in any other
matters required to administer the Plan.
Except as provided for hereinafter, the Plan Administrator shall direct the
Trustee as to the exercise of all voting powers over any shares of Qualifying
Employer Securities. Effective for Plan Years beginning after December 31,
1991, each Participant shall be entitled to direct the Trustee as to the
exercise of all voting powers over shares allocated to his Account that are
Registration Type Qualifying Employer Securities. The Participant shall be
entitled to direct the Trustee as to the manner in which the voting rights will
be exercised over shares allocated to his Account that are not Registration Type
Qualifying Employer Securities with respect to any corporate manner which
involves the voting of such shares allocated to the Participant's Account with
respect to the approval or disapproval of any corporate merger or consolidation,
recapitalization, reclassification, liquidation, dissolution, sale of
substantially all assets of a trade or business, or such similar transaction as
may be prescribed in Treasure Regulations.
The provisions of the Trust Agreement shall govern the exercise of voting
and other rights with respect to shares of Qualifying Employer Securities held
in Trust.
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SECTION 8.02--RECORDS.
All acts and determinations of the Plan Administrator shall be duly
recorded. All these records, together with other documents necessary for the
administration of the Plan, shall be preserved in the Plan Administrator's
custody.
Writing (handwriting, typing, printing), photostating, photographing,
microfilming, magnetic impulse, mechanical or electrical recording or other
forms of data compilation shall be acceptable means of keeping records.
SECTION 8.03--INFORMATION AVAILABLE.
Any Participant in the Plan or any Beneficiary may examine copies of the
Plan description, latest annual report, any bargaining agreement, this Plan, the
Group Contract or any other instrument under which the Plan was established or
is operated. The Plan Administrator shall maintain all of the items listed in
this section in its office, or in such other place or places as it may designate
in order to comply with governmental regulations. These items may be examined
during reasonable business hours. Upon the written request of a Participant or
Beneficiary receiving benefits under the Plan, the Plan Administrator will
furnish him with a copy of any of these items. The Plan Administrator may make a
reasonable charge to the requesting person for the copy.
SECTION 8.04--CLAIM AND APPEAL PROCEDURES.
A Claimant must submit any required forms and pertinent information when
making a claim for benefits under the Plan.
If a claim for benefits under the Plan is denied, the Plan Administrator
shall provide adequate written notice to the Claimant whose claim for benefits
under the Plan has been denied. The notice must be furnished within 90 days of
the date that the claim is received by the Plan Administrator. The Claimant
shall be notified in writing within this initial 90-day period if special
circumstances require an extension of time needed to process the claim and the
date by which the Plan Administrator's decision is expected to be rendered. The
written notice shall be furnished no later than 180 days after the date the
claim was received by the Plan Administrator.
The Plan Administrator's notice to the Claimant shall specify the reason for
the denial; specify references to pertinent Plan provisions on which denial is
based: describe any additional material and information needed for
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the Claimant to perfect his claim for benefits; explain why the material and
information is needed; inform the Claimant that any appeal he wishes to make
must be made in writing to the Plan Administrator within 60 days after receipt
of the Plan Administrator's notice of denial of benefits and that failure to
make the written appeal within such 60-day period shall render the Plan
Administrator's determination of such denial final, binding and conclusive.
If the Claimant appeals to the Plan Administrator, the Claimant, or his
authorized representative, may submit in writing whatever issues and comments
the Claimant, or his representative, feels are pertinent. The Claimant, or his
authorized representative may review pertinent Plan documents. The Plan
Administrator shall reexamine all facts related to the appeal and make a final
determination as to whether the denial of benefits is justified under the
circumstances. The Plan Administrator shall advise the Claimant of its decision
within 60 days of his written request for review, unless special circumstances
(such as a hearing) would make rendering a decision within the 60-day limit
unfeasible. The Claimant must be notified within the 60-day limit if an
extension is necessary. The Plan Administrator shall render a decision on a
claim for benefits no later than 120 days after the request for review is
received.
SECTION 8.05--UNCLAIMED VESTED ACCOUNT PROCEDURE.
At the time the Participant's Vested Account is distributable to the
Participant, spouse or Beneficiary without his consent according to the
provisions of Article VI or Article IX, the Plan Administrator, by certified or
registered mail addressed to his last known address and in accordance with the
notice requirements of Article VI, will notify him of his entitlement to a
benefit. If the Participant, spouse or Beneficiary fails to claim the Vested
Account or make his whereabouts known in writing within six months from the date
of mailing the notice, the Plan Administrator may treat such unclaimed Vested
Account as a forfeiture and apply it according to the forfeiture provisions of
Article III. If Article III contains no forfeiture provisions, such amount will
be applied to reduce the earliest Employer Contributions due after the
forfeiture arises.
If a Participant's Vested Account is forfeited according to the provisions
of the above paragraph and the Participant, his spouse or his Beneficiary at any
time make a claim for benefits, the forfeited Vested Account shall be
reinstated, unadjusted for any gains or losses occurring after the date it was
forfeited. The reinstated Vested Account shall then be distributed to the
Participant, spouse or Beneficiary according to the preceding provisions of the
Plan.
SECTION &06--DELEGATION OF AUTHORITY.
All or any part of the administrative duties and responsibilities under this
article may be delegated by the Plan Administrator to a retirement committee.
The duties and responsibilities of the retirement committee shall be set out in
a separate written agreement.
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ARTICLE IX
GENERAL PROVISIONS
SECTION 9.01--AMENDMENTS.
The Employer may amend this Plan at any time, including any remedial
retroactive changes (within the specified period of time as may be determined by
Internal Revenue Service regulations) to comply with the requirements of any law
or regulation issued by any governmental agency to which the Employer is
subject. An amendment may not diminish or adversely affect any accrued interest
or accrued benefit of Participants or their Beneficiaries or eliminate any
optional form of distribution with respect to benefits attributable to service
before the amendment nor allow reversion or diversion of Plan assets to the
Employer at any time, except as may be necessary to comply with the requirements
of any law or regulation issued by any governmental agency to which the Employer
is subject. No amendment to this Plan shall be effective to the extent that it
has the effect of decreasing a Participant's accrued benefit. However, a
Participant's Account may be reduced to the extent permitted under Code Section
412(c)(8). For purposes of this paragraph, a Plan amendment which has the
effect of decreasing a Participant's Account or eliminating an optional form of
benefit, with respect to benefits attributable to service before the amendment
shall be treated as reducing an accrued benefit. Furthermore, if the vesting
schedule of the Plan is amended, in the case of an Employee who is a Participant
as of the later of the date such amendment is adopted or the date it becomes
effective, the nonforfeitable percentage (determined as of such date) of such
Employee's employer-derived benefit will not be less than his percentage
computed under the Plan without regard to such amendment.
An amendment shall not decrease a Participant's vested interest in the Plan.
If an amendment to the Plan, or a deemed amendment in the case of a change in
top-heavy status of the Plan as provided in the MODIFICATION OF VESTING
REQUIREMENTS SECTION of Article X, changes the computation of the percentage
used to determine that portion of a Participant's Account attributable to
Employer Contributions which is nonforfeitable (whether directly or indirectly),
each Participant or former Participant
a) who has completed at least three Years of Service on the date the
election period described below ends (five Years of Service if the
Participant does not have at least one Hour-of-Service in a Plan Year
beginning after December 31, 1988) and
b) whose nonforfeitable percentage will be determined on any date after the
date of the change
may elect, during the election period, to have the nonforfeitable percentage of
his Account that results from Employer Contributions determined without regard
to the amendment. This election may not be revoked. An election does not need to
be provided for any Participant or former Participant whose nonforfeitable
percentage, determined according to the Plan provisions as changed, cannot at
any time be less than the percentage determined without regard to such change.
The election period shall begin no later than the date the Plan amendment is
adopted, or deemed adopted in the case of a change in the top-heavy status of
the Plan, and end no earlier than the sixtieth day after the latest of the date
the amendment is adopted (deemed adopted) or becomes effective, or the date the
Participant is issued written notice of the amendment (deemed amendment) by the
Employer or the Plan Administrator.
SECTION 9.02--DIRECT ROLLOVERS.
This section applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that would otherwise
limit a Distributee's election under this section, a Distributee may
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elect, at the time and in the manner prescribed by the Plan Administrator, to
have any portion of an Eligible Rollover Distribution paid directly to an
Eligible Retirement Plan, specified by the Distributee, in a Direct Rollover.
SECTION 9.03--MERGERS AND DIRECT TRANSFERS.
The Plan may not be merged or consolidated with, nor have its assets or
liabilities transferred to, any other retirement plan, unless each Participant
in the plan would (if the plan then terminated) receive a benefit immediately
after the merger, consolidation or transfer which is equal to or greater than
the benefit the Participant would have been entitled to receive immediately
before the merger, consolidation or transfer (if this Plan had then terminated).
The Employer may enter into merger agreements or direct transfer of assets
agreements with the employers under other retirement plans which are qualifiable
under Code Section 401(a), including an elective transfer, and may accept the
direct transfer of plan assets, or may transfer plan assets, as a party to any
such agreement. The Employer shall not consent to, or be a party to a merger,
consolidation or transfer of assets with a defined benefit plan if such action
would result in a defined benefit feature being maintained under this Plan.
The Plan may accept a direct transfer of plan assets on behalf of an
Eligible Employee. If the Eligible Employee is not an Active Participant when
the transfer is made, the Eligible Employee shall be deemed to be an Active
Participant only for the purpose of investment and distribution of the
transferred assets. Employer Contributions shall not be made for or allocated to
the Eligible Employee, until the time he meets all of the requirements to become
an Active Participant.
The Plan shall hold, administer and distribute the transferred assets as a
part of the Plan. The Plan shall maintain a separate account for the benefit of
the Employee on whose behalf the Plan accepted the transfer in order to reflect
the value of the transferred assets. Unless a transfer of assets to the Plan is
an elective transfer, the Plan shall apply the optional forms of benefit
protections described in the AMENDMENTS SECTION of Article IX to all transferred
assets. A transfer is elective if: (1) the transfer is voluntary, under a fully
informed election by the Participant; (2) the Participant has an alternative
that retains his Code Section 411(d)(6) protected benefits (including an option
to leave his benefit in the transferor plan, if that plan is not terminating);
(3) if the transferor plan is subject to Code Sections 401(a)(11) and 417, the
transfer satisfies the applicable spousal consent requirements of the Code; (4)
the notice requirements under Code Section 417, requiring a written explanation
with respect to an election not to receive benefits in the form of a qualified
joint and survivor annuity, are met with respect to the Participant and spousal
transfer election; (5) the Participant has a right to immediate distribution
from the transferor plan under provisions in the plan not inconsistent with Code
Section 401(a); (6) the transferred benefit is equal to the Participant's entire
nonforfeitable accrued benefit under the transferor plan, calculated to be at
least the greater of the single sum distribution provided by the transferor plan
(if any) or the present value of the Participant's accrued benefit under the
transferor plan payable at the plan's normal retirement age and calculated using
an interest rate subject to the restrictions of Code Section 417(e) and subject
to the overall limitations of Code Section 415; (7) the Participant has a 100%
nonforfeitable interest in the transferred benefit; and (8) the transfer
otherwise satisfies applicable Treasury regulations.
SECTION 9.04--PROVISIONS RELATING TO THE INSURER AND OTHER PARTIES.
The obligations of an Insurer shall be governed solely by the provisions of
the Group Contract or Insurance Policy. The Insurer shall not be required to
perform any act not provided in or contrary to the provisions of the Group
Contract or insurance Policy. See the CONSTRUCTION SECTION of this article.
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Any issuer or distributor of investment contracts or securities is governed
solely by the terms of its policies, written investment contract, prospectuses,
security instruments, and any other written agreements entered into with the
Trustee.
Such Insurer, issuer or distributor is not a party to the Plan, nor bound in
any way by the Plan provisions. Such parties shall not be required to look to
the terms of this Plan, nor to determine whether the Employer, the Plan
Administrator, the Trustee, or the Named Fiduciary have the authority to act in
any particular manner or to make any contract or agreement.
Until notice of any amendment or termination of this Plan or a change in
Trustee has been received by the Insurer at its home office or an issuer or
distributor at their principal address, they are and shall be fully protected in
assuming that the Plan has not been amended or terminated and in dealing with
any party acting as Trustee according to the latest information which they have
received at their home office or principal address.
SECTION 9.05--EMPLOYMENT STATUS.
Nothing contained in this Plan gives an Employee the right to be retained in
the Employer's employ or to interfere with the Employer's right to discharge any
Employee.
SECTION 9.06--RIGHTS TO PLAN ASSETS.
No Employee shall have any right to or interest in any assets of the Plan
upon termination of his employment or otherwise except as specifically provided
under this Plan, and then only to the extent of the benefits payable to such
Employee in accordance with Plan provisions.
Any final payment or distribution to a Participant or his legal
representative or to any Beneficiaries, spouse or Contingent Annuitant of such
Participant under the Plan provisions shall be in full satisfaction of all
claims against the Plan, the Named Fiduciary, the Plan Administrator, the
Trustee, the Insurer, and the Employer arising under or by virtue of the Plan.
SECTION 9.07--BENEFICIARY.
Each Participant may name a Beneficiary to receive any death benefit (other
than any income payable to a Contingent Annuitant) that may arise out of his
participation in the Plan. The Participant may change his Beneficiary from time
to time. Unless a qualified election has been made, for purposes of distributing
any death benefits before Retirement Date, the Beneficiary of a Participant who
has a spouse who is entitled to a Qualified Preretirement Survivor Annuity shall
be the Participant's spouse. The Participant's Beneficiary designation and any
change of Beneficiary shall be subject to the provisions of the ELECTION
PROCEDURES SECTION of Article VI. It is the responsibility of the Participant to
give written notice to the Insurer of the name of the Beneficiary on a form
furnished for that purpose.
With the Employer's consent, the Plan Administrator may maintain records of
Beneficiary designations for Participants before their Retirement Dates. In that
event the written designations made by Participants shall be filed with the Plan
Administrator. If a Participant dies before his Retirement Date, the Plan
Administrator shall certify to the Insurer the Beneficiary designation on its
records for the Participant.
If, at the death of a Participant, there is no Beneficiary named or
surviving, any death benefit under the Group Contract or Insurance Policy shall
be paid under the applicable provisions of the respective documents.
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<PAGE>
SECTION 9.08--NONALIENATION OF BENEFITS.
Benefits payable under the Plan are not subject to the claims of any
creditor of any Participant, Beneficiary, spouse or Contingent Annuitant. A
Participant, Beneficiary, spouse or Contingent Annuitant does not have any
rights to alienate, anticipate, commute, pledge, encumber or assign any of such
benefits, except in the case of a loan as provided in the LOANS TO PARTICIPANTS
SECTION of Article V. The preceding sentences shall also apply to the creation,
assignment, or recognition of a right to any benefit payable with respect to a
Participant according to a domestic relations order, unless such order is
determined by the Plan Administrator to be a qualified domestic relations order,
as defined in Code Section 414(p), or any domestic relations order entered
before January 1, 1985.
SECTION 9.09--CONSTRUCTION.
The validity of the Plan or any of its provisions is determined under and
construed according to Federal law and, to the extent permissible, according to
the laws of the state in which the Employer has its principal office. In case
any provision of this Plan is held illegal or invalid for any reason, such
determination shall not affect the remaining provisions of this Plan, and the
Plan shall be construed and enforced as if the illegal or invalid provision had
never been included.
In the event of any conflict between the provisions of the Plan and the
terms of any contract or policy issued hereunder, the provisions of the Plan
control the operation and administration of the Plan.
SECTION 9.10--LEGAL ACTIONS.
The Plan, the Plan Administrator, the Trustee and the Named Fiduciary are
the necessary parties to any action or proceeding involving the assets held with
respect to the Plan or administration of the Plan or Trust. No person employed
by the Employer, no Participant, former Participant or their Beneficiaries or
any other person having or claiming to have an interest In the Plan is entitled
to any notice of process. A final judgment entered in any such action or
proceeding shall be binding and conclusive on all persons having or claiming to
have an interest in the Plan.
SECTION 9.11--SMALL AMOUNTS.
If the Vested Account of a Participant has never exceeded $3,500, the entire
Vested Account shall be payable in a single sum as of the earliest of his
Retirement Date, the date he dies, or the date he ceases to be an Employee for
any other reason. This is a small amounts payment. If a small amount is payable
as of the date the Participant dies, the small amounts payment shall be made to
the Participant's Beneficiary (spouse if the death benefit is payable to the
spouse). If a small amounts payment is payable while the Participant is living,
the small amounts payment shall be made to the Participant. The small amounts
payment is in full settlement of all benefits otherwise payable.
No other small amounts payments shall be made.
SECTION 9.12--WORD USAGE.
The masculine gender, where used in this Plan, shall include the feminine
gender and the singular words as used in this Plan may include the plural,
unless the context indicates otherwise.
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<PAGE>
SECTION 9.13--TRANSFERS BETWEEN PLANS.
If an Employee previously participated in another plan of the Employer which
credited service under the elapsed time method for any purpose which under this
Plan is determined using the hours method, then the Employee's service shall be
equal to the sum of (a), (b) and (c) below:
a) The number of whole years of service credited to him under the other
plan as of the date he became an Eligible Employee under this Plan.
b) One year or a part of a year of service for the applicable service
period in which he became an Eligible Employee if he is credited with
the required number of Hours-of-Service. If the Employer does not have
sufficient records to determine the Employee's actual Hours-of-Service
in that part of the service period before the date he became an Eligible
Employee, the Hours-of-Service shall be determined using an equivalency.
For any month in which he would be required to be credited with one
Hour-of-Service, the Employee shall be deemed for purposes of this
section to be credited with 190 Hours-of-Service.
c) The Employee's service determined under this Plan using the hours method
after the end of the applicable service period in which he became an
Eligible Employee.
If an Employee previously participated in another plan of the Employer which
credited service under the hours method for any purpose which under this Plan is
determined using the elapsed time method, then the Employee's service shall be
equal to the sum of (d), (e) and (f) below:
d) The number of whole years of service credited to him under the other
plan as of the beginning of the applicable service period under that
plan in which he became an Eligible Employee under this Plan.
e) The greater of (1) the service that would be credited to him for that
entire service period using the elapsed time method or (2) the service
credited to him under the other plan as of the date he became an
Eligible Employee under this Plan.
f) The Employee's service determined under this Plan using the elapsed time
method after the end of the applicable service period under the other
plan in which he became an Eligible Employee.
Any modification of service contained in this Plan shall be applicable to
the service determined pursuant to this section.
If the Employee previously participated in the plan of a Controlled Group
member which credited service under a different method than is used in this
Plan, for purposes of determining eligibility and vesting the provisions above
shall apply as though the plan of the Controlled Group member were a plan of the
Employer.
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<PAGE>
ARTICLE X
TOP-HEAVY PLAN REQUIREMENTS
SECTION 10.01--APPLICATION.
The provisions of this article shall supersede all other provisions in the
Plan to the contrary.
For the purpose of applying the Top-heavy Plan requirements of this article,
all members of the Controlled Group shall be treated as one Employer. The term
Employer as used in this article shall be deemed to include all members of the
Controlled Group unless the term as used clearly indicates only the Employer is
meant.
The accrued benefit or account of a participant which results from
deductible voluntary contributions shall not be included for any purpose under
this article.
The minimum vesting and contribution provisions of the MODIFICATION OF
VESTING REQUIREMENTS and MODIFICATION OF CONTRIBUTIONS SECTIONS of Article X
shall not apply to any Employee who is included in a group of Employees covered
by a collective bargaining agreement which the Secretary of Labor finds to be a
collective bargaining agreement between employee representatives and one or more
employers, including the Employer, if there is evidence that retirement benefits
were the subject of good faith bargaining between such representatives. For this
purpose, the term "employee representatives" does not include any organization
more than half of whose members are employees who are owners, officers, or
executives.
SECTION 10.02--DEFINITIONS.
The following terms are defined for purposes of this article.
Aggregation Group means
-----------------
a) each of the Employer's retirement plans in which a Key Employee is a
participant during the Year containing the Determination Date or one
of the four preceding Years.
b) each of the Employer's other retirement plans which allows the
plan(s) described in (a) above to meet the nondiscrimination
requirement of Code Section 401(a)(4) or the minimum coverage
requirement of Code Section 410, and
c) any of the Employer's other retirement plans not included in (a) or
(b) above which the Employer desires to include as part of the
Aggregation Group. Such a retirement plan shall be included only if
the Aggregation Group would continue to satisfy the requirements of
Code Section 401(a)(4) and Code Section 410.
The plans in (a) and (b) above constitute the "required" Aggregation Group.
The plans in (a), (b) and (c) above constitute the "permissive" Aggregation
Group.
Compensation means, as to an Employee for any period, compensation as
------------
defined in the CONTRIBUTION LIMITATION SECTION of Article III. For purposes
of determining who is a Key Employee, Compensation shall include, in
addition to compensation as defined in the CONTRIBUTION LIMITATION SECTION
of Article III, elective contributions. Elective contributions are amounts
which are excludible from the Employee's gross income under Code Sections
125, 402(e)(3), 402(h) or 403(b), and contributed by the Employer, at the
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<PAGE>
Employee's election, to a Code Section 401(k) arrangement, a simplified employee
pension, cafeteria plan or tax-sheltered annuity.
For purposes of Compensation as defined in this section, Compensation shall be
limited in the same manner and in the same time as the Compensation defined in
the DEFINITION SECTION of Article I.
Determination Date means as to this Plan for any Year, the last day of the
- ------------------
preceding Year. However, if there is no preceding Year, the Determination Date
is the last day of such Year.
Key Employee means any Employee or former Employee (including Beneficiaries of
- ------------
deceased Employees) who at any time during the determination period was
a) one of the Employer's officers (subject to the maximum below) whose
Compensation (as defined in this section) for the Year exceeds 50
percent of the dollar limitation under Code Section 41 5(b)(1)(A).
b) one of the ten Employees who owns (or is considered to own, under Code
Section 318) more than a half percent ownership interest and one of the
largest interests in the Employer during any Year of the determination
period if such person's Compensation (as defined in this section) for
the Year exceeds the dollar limitation under Code Section 41 5(c)(1)(A),
c) a five-percent owner of the Employer, or
d) a one-percent owner of the Employer whose Compensation (as defined in
this section) for the Year is more than $150,000.
Each member of the Controlled Group shall be treated as a separate employer for
purposes of determining ownership in the Employer.
The determination period is the Year containing the Determination Date and the
four preceding Years. If the Employer has fewer than 30 Employees, no more than
three Employees shall be treated as Key Employees because they are officers. If
the Employer has between 30 and 500 Employees, no more than ten percent of the
Employer's Employees (if not an integer, increased to the next integer) shall be
treated as Key Employees because they are officers. In no event will more than
50 Employees be treated as Key Employees because they are officers if the
Employer has 500 or more Employees. The number of Employees for any Plan Year is
the greatest number of Employees during the determination period. Officers who
are employees described in Code Section 414(q)(8) shall be excluded. If the
Employer has more than the maximum number of officers to be treated as Key
Employees, the officers shall be ranked by amount of annual Compensation (as
defined in this section), and those with the greater amount of annual
Compensation during the determination period shall be treated as Key Employees.
To determine the ten Employees owning the largest interests in the Employer, if
more than one Employee has the same ownership interest, the Employee(s) having
the greater annual Compensation shall be treated as owning the larger
interest(s). The determination of who is a Key Employee shall be made according
to Code Section 416(i)(1) and the regulations thereunder.
Non-key Employee means a person who is a non-key employee within the meaning of
- ----------------
Code Section 416 and regulations thereunder.
Present Value means the present value of a participant's accrued benefit under a
- -------------
defined benefit plan as of his normal retirement age (attained age if later) or,
if the plan provides non-proportional subsidies, the
70
<PAGE>
age at which the benefit is most valuable. The accrued benefit of any Employee
(other than a Key Employee) shall be determined under the method which is used
for accrual purposes for all plans of the Employer or if there is no one method
which is used for accrual purposes for all plans of the Employer, as if such
benefit accrued not more rapidly than the slowest accrual rate permitted under
Code Section 411(b)(1)(C). For purposes of establishing Present Value, any
benefit shall be discounted only for 7.5% interest and mortality according to
the 1971 Group Annuity Table (Male) without the 7% margin but with projection by
Scale E from 1971 to the later of (a) 1974, or (b) the year determined by adding
the age to 1920, and wherein for females the male age six years younger is used.
If the Present Value of accrued benefits is determined for a participant under
more than one defined benefit plan included in the Aggregation Group, all such
plans shall use the same actuarial assumptions to determine the Present Value.
Top-heavy Plan means a plan which is a top-heavy plan for any plan year
- --------------
beginning after December 31, 1983. This Plan shall be a Top-heavy Plan if
a) the Top-heavy Ratio for this Plan alone exceeds 60 percent and this Plan
is not part of any required Aggregation Group or permissive Aggregation
Group.
b) this Plan is a part of a required Aggregation Group, but not part of a
permissive Aggregation Group, and the Top-heavy Ratio for the required
Aggregation Group exceeds 60 percent.
c) this Plan is a part of a required Aggregation Group and part of a
permissive Aggregation Group and the Top-heavy Ratio for the permissive
Aggregation Group exceeds 60 percent.
Top-heavy Ratio means the ratio calculated below for this Plan or for the
- ---------------
Aggregation Group.
a) If the Employer maintains one or more defined contribution plans
(including any simplified employee pension plan) and the Employer has
not maintained any defined benefit plan which during the five-year
period ending on the determination date has or has had accrued benefits,
the Top-heavy Ratio for this Plan alone or for the required or
permissive Aggregation Group as appropriate is a fraction, the numerator
of which is the sum of the account balances of all Key Employees as of
the determination date and the denominator of which is the sum of all
account balances of all employees as of the determination date. Both the
numerator and denominator of the Top-heavy Ratio are adjusted for any
distribution of an account balance (including those made from terminated
plan(s) of the Employer which would have been part of the required
Aggregation Group had such plan(s) not been terminated) made in the
five-year period ending on the determination date. Both the numerator
and denominator of the Top-heavy Ratio are increased to reflect any
contribution not actually made as of the Determination Date, but which
is required to be taken into account on that date under Code Section 416
and the regulations thereunder.
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<PAGE>
b) If the Employer maintains one or more defined contribution plans
(including any simplified employee pension plan) and the Employer
maintains or has maintained one or more defined benefit plans which
during the five-year period ending on the determination date has or has
had accrued benefits, the Top-heavy Ratio for any required or permissive
Aggregation Group as appropriate is a fraction, the numerator of which
is the sum of the account balances under the defined contribution
plan(s) of all Key Employees and the Present Value of accrued benefits
under the defined benefit plan(s) for all Key Employees, and the
denominator of which is the sum of the account balances under the
defined contribution plan(s) for all employees and the Present Value of
accrued benefits under the defined benefit plans for alt employees. Both
the numerator and denominator of the Top-heavy Ratio are adjusted for
any distribution of an account balance or an accrued benefit (including
those made from terminated plan(s) of the Employer which would have been
part of the required Aggregation Group had such plan(s) not been
terminated) made in the five-year period ending on the determination
date.
c) For purposes of (a) and (b) above, the value of account balances and the
Present Value of accrued benefits will be determined as of the most
recent valuation date that falls within or ends with the 12-month period
ending on the determination date, except as provided in Code Section 416
and the regulations thereunder for the first and second plan years of a
defined benefit plan. The account balances and accrued benefits of an
employee whp is not a Key Employee but who was a Key Employee in a prior
year will be disregarded. The calculation of the Top-heavy Ratio and the
extent to which distributions, rollovers and transfers during the
five-year period ending on the determination date are to be taken into
account, shall be determined according to the provisions of Code Section
416 and regulations thereunder. The account balances and accrued
benefits of an individual who has performed no service for the Employer
during the five-year period ending on the determination date shall be
excluded from the Top-heavy Ratio until the time the individual again
performs service for the Employer. Deductible employee contributions
will not be taken into account for purposes of computing the Top-heavy
Ratio. When aggregating plans, the value of account balances and accrued
benefits will be calculated with reference to the determination dates
that fall within the same calendar year.
Account, as used in this definition, means the value of an employee's account
under one of the Employer's retirement plans on the latest valuation date. In
the case of a money purchase plan or target benefit plan, such value shall be
adjusted to include any contributions made for or by the employee after the
valuation date and on or before such determination date or due to be made as of
such determination date but not yet forwarded to the insurer or trustee. In the
case of a profit sharing plan, such value shall be adjusted to include any
contributions made for or by the employee after the valuation date and on or
before such determination date. During the first Year of any profit sharing plan
such adjustment in value shall include contributions made after such
determination date that are allocated as of a date in such Year. The
nondeductible employee contributions which an employee makes under a defined
benefit plan of the Employer shall be treated as if they were contributions
under a separate defined contribution plan.
Valuation Date means, as to this Plan, the last day of the last calendar month
- --------------
ending in a Year.
Year means the Plan Year unless another year is specified by the Employer in a
- ----
separate written resolution in accordance with regulations issued by the
Secretary of the Treasury or his delegate.
72
<PAGE>
SECTION 10.03--MODIFICATION OF VESTING REQUIREMENTS.
If a Participant's Vesting Percentage determined under Article I is not at
least as great as his Vesting Percentage would be if it were determined under a
schedule permitted in Code Section 416, the following shall apply. During any
Year in which the Plan is a Top-heavy Plan, the Participant's Vesting Percentage
shall be the greater of the Vesting Percentage determined under Article I or the
schedule below.
<TABLE>
<CAPTION>
VESTING SERVICE NONFORFEITABLE
(whole years) PERCENTAGE
<S> <C>
Less than 2 0
2 20
3 40
4 60
5 80
6 or more 100
</TABLE>
The schedule above shall not apply to Participants who are not credited with
an Hour-of-Service after the Plan first becomes a Top-heavy Plan. The Vesting
Percentage determined above applies to all of the Participant's Account
resulting from Employer Contributions, including Contributions the Employer
makes before the TEFRA Compliance Date or when the Plan is not a Top-heavy Plan.
If, in a later Year, this Plan is not a Top-heavy Plan, a Participant's
Vesting Percentage shall be determined under Article I. A Participant's Vesting
Percentage determined under either Article I or the schedule above shall never
be reduced and the election procedures of the AMENDMENTS SECTION of Article IX
shall apply when changing to or from the schedule as though the automatic change
were the result of an amendment.
The part of the Participant's Vested Account resulting from the minimum
contributions required pursuant to the MODIFICATION OF CONTRIBUTIONS SECTION of
Article X shall not be forfeited because of a period of reemployment after
benefit payments have begun.
SECTION 10.04--MODIFICATION OF CONTRIBUTIONS.
During any Year in which this Plan is a Top-heavy Plan, the Employer shall
make a minimum contribution or allocation on the last day of the Year for each
person who is a Non-key Employee on that day and who either was or could have
been an Active Participant during the Year. A Non-Key Employee is not required
to have a minimum number of hours-of-service or minimum amount of Compensation,
or to have had any Elective Deferral Contributions made for him in order to be
entitled to this minimum. The minimum contribution or allocation for such person
shall be equal to the lesser of (a) or (b) below:
a) Three percent of such person's Compensation (as defined in this
article).
b) The "highest percentage" of Compensation (as defined in this article)
for such Year at which the Employer's contributions are made for or
allocated to any Key Employee. The highest percentage shall be
determined by dividing the Employer Contributions made for or allocated
to each Key Employee during such Year by the amount of his Compensation
(as defined in this article), which is not more than the maximum set out
above, and selecting the greatest quotient (expressed as a percentage).
To determine the highest percentage, all of the Employer's defined
contribution plans within the Aggregation Group shall be treated as one
plan. The provisions of this paragraph shall not
73
<PAGE>
apply if this Plan and a defined benefit plan of the Employer are
required to be included in the Aggregation Group and this Plan enables
the defined benefit plan to meet the requirements of Code Section
401(a)(4) or Code Section 410.
If the Employer's contributions and allocations otherwise required under the
defined contribution plan(s) are at least equal to the minimum above, no
additional contribution or reallocation shall be required. If the Employer's
contributions and allocations are less than the minimum above and Employer
Contributions under this Plan are allocated to Participants, any Employer
Contributions (other than those which are allocated on the basis of the amount
made for such person) shall be reallocated to provide the minimum. The remaining
Contributions shall be allocated as provided in the preceding articles of this
Plan taking into account any amount which was reallocated to provide the
minimum. If the Employer's total contributions and allocations are less than the
minimum above after any reallocation provided above, the Employer shall
contribute the difference for the Year.
The minimum contribution or allocation applies to all of the Employer's
defined contribution plans in the aggregate which are Top-heavy Plans. If an
additional contribution or allocation is required to meet the minimum above, it
shall be provided in this Plan.
A minimum allocation under a profit sharing plan shall be made without
regard to whether or not the Employer has profits.
If a person who is otherwise entitled to a minimum contribution or
allocation above is also covered under a defined benefit plan of the Employer's
which is a Top-heavy Plan during that same Year, the minimum benefits for him
shall not be duplicated. The defined benefit plan shall provide an annual
benefit for him on, or adjusted to, a straight life basis of the lesser of (c)
two percent of his average pay multiplied by his years of service or (d) twenty
percent of his average pay. Average pay and years of service shall have the
meaning set forth in such defined benefit plan for this purpose.
For purposes of this section, any employer contribution made according to a
salary reduction or similar arrangement shall not apply before the first Yearly
Date in 1985. On and after the first Yearly Date in 1989, any such employer
contributions and employer contributions which are matching contributions, as
defined in Code Section 401(m), shall not apply in determining if the minimum
contribution requirement has been met, but shall apply in determining the
minimum contribution required. Forfeitures credited to a Participant's Account
are treated as employer contributions.
The requirements of this section shall be met without regard to
contributions under Chapter 2 of the Code (relating to tax on self-employment),
Chapter 21 of the Code (relating to Federal Insurance Contributions Act). Title
II of the Social Security Act or any other Federal or state law.
SECTION 10.05--MODIFICATION OF CONTRIBUTION LIMITATION.
If the provisions of subsection (e) of the CONTRIBUTION LIMITATION SECTION
of Article III are applicable for any Limitation Year during which this Plan is
a Top-heavy Plan, the benefit limitations shall be modified. The definitions of
Defined Benefit Plan Fraction and Defined Contribution Plan Fraction in the
CONTRIBUTION LIMITATION SECTION of Article III shall be modified by substituting
"1.0" in lieu of "1.25." The optional denominator for determining the Defined
Contribution Plan Fraction shall be modified by substituting "$41,500" in lieu
of "$51,875." In addition, an adjustment shall be made to the numerator of the
Defined Contribution Plan Fraction. The adjustment is a reduction of that
numerator similar to the modification of the Defined Contribution Plan Fraction
described in the CONTRIBUTION LIMITATION SECTION of Article III, and shall be
made with respect to the last Plan Year beginning before January 1, 1984.
74
<PAGE>
The modifications in the paragraph above shall not apply with respect to a
Participant so long as employer contributions, forfeitures or nondeductible
employee contributions are not credited to his account under this or any of the
Employer's other defined contribution plans and benefits do not accrue for such
Participant under the Employer's defined benefit plan(s), until the sum of his
Defined Contribution and Defined Benefit Plan Fractions is less than 1.0.
75
<PAGE>
By executing this Plan, the Primary Employer acknowledges having counseled
to the extent necessary with selected legal and tax advisors regarding the
Plan's legal and tax implications.
Executed this 11th day of April, 1996.
BARRETT RESOURCES CORPORATION
By /s/ SIGNATURE APPEARS HERE
------------------------------
SENIOR VICE PRESIDENT
------------------------------
Title
76
<PAGE>
Exhibit 23(a)
-------------
(Attached To And Made Part Of The
Registration Statement On Form S-8 Of
Barrett Resources Corporation
Filed April 15, 1995)
CONSENT OF ARTHUR ANDERSEN LLP
------------------------------
<PAGE>
CONSENT OF ARTHUR ANDERSEN LLP
INDEPENDENT AUDITORS
--------------------
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-S) and related Prospectus pertaining to the
Barrett Resources Corporation Retirement Savings Plan and to the incorporation
by reference therein of our report dated March 1, 1996 with respect to the
financial statements of Barrett Resources Corporation included in its Annual
Report (Form 10-K) for the year ended December 31, 1995 filed with the
Securities And Exchange Commission.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Denver, Colorado
April 12, 1996
<PAGE>
Exhibit 23(b)
-------------
(Attached To And Made Part Of The
Registration Statement On Form S-8 Of
Barrett Resources Corporation
Filed April 15, 1996)
CONSENT OF BEARMAN TALESNICK & CLOWDUS
---------------------------------------
PROFESSIONAL CORPORATION
------------------------
<PAGE>
CONSENT OF BEARMAN TALESNICK & CLOWDUS
PROFESSIONAL CORPORATION
The undersigned does hereby consent to the use of its name wherever
appearing in the Registration Statement and related Prospectus, including "Legal
Matters".
However, the undersigned disclaims any responsibility as an expert as
regards this Registration Statement except insofar as the Registration Statement
may relate to a written legal opinion from the undersigned.
/s/ Bearman Talesnick & Clowdus
Professional Corporation
BEARMAN TALESNICK & CLOWDUS
Professional Corporation
Denver, Colorado
April 12, 1996
