<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 10, 1996
REGISTRATION NO. 333-[ ]
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
PRIMARK CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
<TABLE>
<S> <C>
MICHIGAN 38-2383282
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER IDENTIFICATION NO.)
OF INCORPORATION OR ORGANIZATION)
</TABLE>
1000 WINTER STREET, SUITE 4300
WALTHAM, MASSACHUSETTS 02154
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
TASC PROFIT SHARING AND STOCK OWNERSHIP PLAN
(MAINTAINED BY TASC, INC., A WHOLLY OWNED SUBSIDIARY OF THE REGISTRANT)
(FULL TITLE OF THE PLAN)
MICHAEL R. KARGULA, ESQ.
SENIOR VICE PRESIDENT, GENERAL COUNSEL
AND SECRETARY
PRIMARK CORPORATION
1000 WINTER STREET, SUITE 4300
WALTHAM, MASSACHUSETTS 02154
(617) 466-6611
(NAME, ADDRESS AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
CALCULATION OF REGISTRATION FEE
<TABLE>
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
<CAPTION>
PROPOSED MAXIMUM PROPROSED
TITLE OF SECURITIES AMOUNT TO BE OFFERING PRICE MAXIMUM AGGREGATE AMOUNT OF
TO BE REGISTERED REGISTERED(1) PER SHARE(2) OFFERING PRICE(2) REGISTRATION FEE
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock,
without par value.......... 1,414,276 $24.875 $35,180,115.50 $10,660.64
- -------------------------------------------------------------------------------------------------
- -------------------------------------------------------------------------------------------------
</TABLE>
(1) Represents (i) 1,164,276 shares of common stock, without par value ("Common
Stock") acquired by the Plan on May 2, 1996 upon the conversion of the
Company's Series A Cumulative Convertible Preferred Stock previously held by
the TASC Profit Sharing and Stock Ownership Plan, maintained by TASC, Inc.,
a wholly owned subsidiary of the Registrant (the "Plan"), and (ii) 250,000
additional shares which may be required by participant purchase transactions
under the Plan.
(2) Estimated solely for the purpose of calculating the registration fee
pursuant to Securities Act Rule 457(h), based upon the average of the high
and low prices for shares of the Registrant's Common Stock as reported on
the New York Stock Exchange on December 6, 1996.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
EXPLANATORY NOTE
In accordance with the instructional Note to Part I of Form S-8 as
promulgated by the Securities and Exchange Commission, the information specified
by Part I of Form S-8 has been omitted from this Registration Statement on Form
S-8 for offers of Common Stock pursuant to the Plan.
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents filed by Primark Corporation (the "Corporation" or
the "Registrant") with the Securities and Exchange Commission (the "Commission")
are hereby incorporated herein by reference:
(i) Annual Report on Form 10-K for the fiscal year ended December 31,
1995;
(ii) Quarterly Reports on Form 10-Q for the quarters ended March 31, 1996,
June 30, 1996, and September 30, 1996;
(iii) Current Reports on Form 8-K filed August 15, 1996 and November 14,
1996;
(iv) The description of the Corporation's Common Stock contained in the
Corporation's Form 10 dated November 17, 1981, the Corporation's Form
8-A dated October 18, 1985, the Corporation's Form 8-A dated January
13, 1988, and the Corporation's Form 8-A dated June 16, 1992.
All documents filed by the Corporation pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act after the date of this Registration Statement
and prior to the filing of a post-effective amendment which indicates that all
of the Corporation's Common Stock offered hereby has been sold or which
withdraws from registration such Common Stock then remaining unsold, shall be
deemed to be incorporated in this Registration Statement by reference and to be
a part hereof from the date of filing such documents. Any statement contained in
a document incorporated or deemed to be incorporated by reference in this
Registration Statement shall be deemed to be modified or superseded for purposes
of this Registration Statement to the extent that a statement contained herein
or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the securities of the Corporation being registered hereby
has been passed upon by Michael R. Kargula, Esq., General Counsel to the
Corporation. As of December 9, 1996, Mr. Kargula beneficially owned 400,230
shares of Corporation Common Stock. This number of shares beneficially owned by
Mr. Kargula as of December 9, 1996, does not include a currently indeterminable
number of shares that will be allocated to Mr. Kargula's account under the
Primark Corporation Employee Stock Ownership Plan on or about December 31, 1996.
The qualification of the TASC Profit Sharing and Stock Ownership Plan under
Section 401(a) of the Internal Revenue Code has been passed upon for the
Registrant by Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., Special
Counsel to the Registrant. As of December 9, 1996, attorneys employed by such
Special Counsel, and members of their immediate families, did not beneficially
own any shares of the Corporation's Common Stock.
The audited financial statements and schedules incorporated by reference in
this Registration Statement have been examined by Deloitte & Touche LLP,
independent certified public accountants, as set forth in their report
incorporated by reference herein, and are included in reliance upon the
authority of such firm as experts in auditing and accounting.
II-1
<PAGE> 4
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Sections 561 and 571 of the Michigan Business Corporation Act (the "MBCA")
contain detailed provisions concerning the indemnification of directors,
officers, employees, and agents against judgments, penalties, fines and amounts
paid in settlement of litigation that they may incur in their capacity as such.
Article VIII of the Articles of Incorporation of the Registrant provides
that the Registrant shall indemnify any person who is or was a director or
officer of the Registrant or is or was serving at the request of the Registrant
as a director, officer, employee, or agent of another corporation, partnership,
joint venture, trust or other enterprise against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by such person in connection with any threatened, pending or completed
action, suit, or proceeding to the full extent provided by the MBCA from time to
time in effect.
Section 6.1 of the By-laws of the Registrant provides that the Registrant
shall indemnify its officers, directors, employees, agents and other persons to
the fullest extent to which corporations are empowered to indemnify such persons
at law.
Article IX of the Articles of Incorporation of the Registrant provides that
a director of the Registrant shall not be personally liable to the Registrant or
its stockholders for monetary damages for breach of fiduciary duty as a
director, except for liability (i) for any breach of the director's duty of
loyalty to the Registrant or its stockholders, (ii) for acts or omissions not in
good faith or that involve intentional misconduct or a knowing violation of law,
(iii) for a violation of Section 551(1) of the MBCA or (iv) for any transaction
from which the director derived any improper personal benefit.
The Corporation maintains a director's and officer's liability insurance
policy that covers its directors and officers for certain claims and actions
incurred in the course of their duties, including, under certain circumstances,
alleged violations of the Securities Act of 1933, as amended.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The exhibits listed on the Index of Exhibits of this Registration Statement
are filed herewith or are incorporated herein by reference to other filings.
ITEM 9. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
1. To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act").
(ii) To reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the Registration Statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low
or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Commission
pursuant to Rule 424(b) if, in the aggregate, the changes in
volume and price represent no more than a 20% change in the
maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement.
II-2
<PAGE> 5
(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 (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed by the Registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the Registration Statement;
2. That, for the purpose of determining any liability under the Securities
Act, each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof;
3. To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the
termination of the offering;
4. That, for purposes of determining any liability under the Securities
Act, each filing of the Registrant's annual report pursuant to Section
13(a) or Section 15(d) of the Exchange Act 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; and
5. Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of
the Registrant pursuant to the foregoing provisions, or otherwise, the
Registrant has been advised that in the opinion of the Commission such
indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being registered,
the Registrant will, unless in the opinion of its counsel the matter has
been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against
public policy as expressed in the Securities Act and will be governed by
the final adjudication of such issue.
II-3
<PAGE> 6
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Waltham, Commonwealth of Massachusetts on December
10, 1996.
PRIMARK CORPORATION
By: /s/ STEPHEN H. CURRAN
-------------------------------
Stephen H. Curran
Senior Vice President and
Chief Financial Officer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the dates indicated, and each undersigned director
and/or officer hereby constitutes and appoints J.E. Kasputys, M. R. Kargula, and
S. H. Curran and each of them (with full power to each of them to act alone),
his or her true and lawful attorneys-in-fact and agents with full power of
substitution and resubstitution, for him or her and on his or her behalf and in
his or her name, place and stead, in any and all capacities, to sign, execute
and file with the Commission (or any other governmental or regulatory authority)
this Registration Statement on Form S-8 (or any other appropriate form), and any
and all amendments (including post-effective amendments) thereto, with all
exhibits and any and all documents required to be filed with respect thereto,
relating to the registration under the Securities Act of 1933 of shares of the
Corporation's common stock authorized to be issued or sold pursuant to the TASC
Profit Sharing and Stock Ownership Plan, and of plan interests in such Plan,
granting unto said attorneys, and each of them, full power and authority to do
and to perform each and every act and thing requisite and necessary to be done
in order to effectuate the same as fully to all intents and purposes as he
himself or she herself might or could do if personally present, hereby ratifying
and confirming all that said attorneys-in-fact and agents, or any of them, may
lawfully do or cause to be done by virtue hereof.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------ ------------------------------ ------------------
<S> <C> <C>
/s/ JOSEPH E. KASPUTYS Chairman, President and December 9, 1996
- ------------------------------------------ Chief Executive Officer
Joseph E. Kasputys (Principal Executive Officer)
/s/ STEPHEN H. CURRAN Senior Vice President and December 9, 1996
- ------------------------------------------ Chief Financial Officer
Stephen H. Curran (Principal Financial and
Accounting Officer)
/s/ KEVIN J. BRADLEY Director December 9, 1996
- ------------------------------------------
Kevin J. Bradley
/s/ JOHN C. HOLT Executive Vice President and December 9, 1996
- ------------------------------------------ Director
John C. Holt
/s/ STEVEN LAZARUS Director December 9, 1996
- ------------------------------------------
Steven Lazarus
/s/ PATRICIA G. MCGINNIS Director December 9, 1996
- ------------------------------------------
Patricia G. McGinnis
</TABLE>
II-4
<PAGE> 7
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ------------------------------------------ ------------------------------ ------------------
<S> <C> <C>
/s/ JONATHAN NEWCOMB Director December 9, 1996
- ------------------------------------------
Jonathan Newcomb
/s/ CONSTANCE K. WEAVER Director December 9, 1996
- ------------------------------------------
Constance K. Weaver
</TABLE>
Pursuant to the requirements of the Securities Act of 1933, the
Administrator of the TASC Profit Sharing and Stock Ownership Plan has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Reading, Commonwealth of
Massachusetts on December 9, 1996.
By: /s/ KENNETH M. STONE
-------------------------------
Administrator
Kenneth M. Stone
II-5
<PAGE> 8
INDEX OF EXHIBITS
<TABLE>
<S> <C> <C>
Exhibit 4.1 -- Articles of Incorporation of the Registrant (incorporated by reference to
Exhibit 3.1 to the Registrant's Registration Statement No. 2-74688);
Amendment to the Articles of Incorporation (incorporated by reference to
Exhibit 3.1 to the Registrant's 1985 Form 10-K, SEC File No. 00108260);
Amendment dated August 8, 1991 (incorporated by reference to Exhibit 3(a)
to the Registrant's Form 8-K dated August 9, 1991, SEC File No. 00108260);
Amendment dated May 27, 1992 (incorporated by reference to Exhibit 3.1 to
the Registrant's June 30, 1992 Form 10-Q, SEC File No. 00108260).
Exhibit 4.2 -- By-laws of the Registrant, as amended (incorporated by reference to the
Registrant's September 30, 1990 Form 10-Q, SEC File No. 00108260).
Exhibit 4.3 -- Rights Agreement, dated January 12, 1988, between the Registrant and Bankers
Trust Company, which includes, as Exhibit A thereto, the Rights Certificate
and, as Exhibit B thereto, the Summary of Rights to Purchase Common Stock
(incorporated by reference to Exhibit 28.1 to the Registrant's Form 8-K dated
January 14, 1988, SEC File No. 00108260); Certified copy of resolution
amending the Registrant's Rights Agreement (incorporated by reference to
Exhibit 28.4 to the Registrant's Form 8-K dated July 13, 988, SEC File No.
00108260); Amendment to Rights Agreement, dated April 9, 1990 (incorporated
by reference to Exhibit 28.1 to the Registrant's Form 8-K dated April 12,
1990, SEC File No. 00108260); Letter, dated May 10, 1990, regarding
appointment of Bank of America as new Rights Agent under the Rights
Agreement, as amended (incorporated by reference to Exhibit 28.1 to the
Registrant's 1990 Form 10-K, SEC File No. 00108260); Amendment to Rights
Agreement, dated May 31, 1992, between the Registrant and Bank of America
National Trust and Savings Association, as Rights Agent (incorporated by
reference to Exhibit 28.1 to the Registrant's June 30, 1992 Form 10-Q, SEC
File No. 00108260); Letter dated July 31, 1992 regarding appointment of The
First National Bank of Boston as new Rights Agent (incorporated by reference
to Exhibit 28.2 to the Registrant's June 30, 1992 Form 10-Q, SEC File No.
00108260).
Exhibit 4.4 -- TASC Profit Sharing and Stock Ownership Plan, filed herewith.
Exhibit 5.1 -- Opinion of Michael R. Kargula, General Counsel of the Corporation, with
respect to the validity of the Common Stock being registered hereby, filed
herewith.
Exhibit 5.2 -- Opinion of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., Special
Counsel to the Registrant, as to the qualification of the TASC Profit Sharing
and Stock Ownership Plan under Section 401(a) of the Internal Revenue Code.
Exhibit 23.1 -- Consent of Deloitte & Touche LLP, independent accountants to the Corporation,
filed herewith.
Exhibit 23.2 -- Consent of Leslie Sufrin and Company, P.C., filed herewith.
Exhibit 23.3 -- Consent of Michael R. Kargula, General Counsel of the Corporation, contained
in his opinion filed as Exhibit 5.1 hereto.
Exhibit 23.4 -- Consent of Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C., Special
Counsel to the Corporation contained in the Opinion of Special Counsel filed
as Exhibit 5.2 hereto.
Exhibit 24.1 -- Power of Attorney (set forth in the signature page).
</TABLE>
II-6
<PAGE> 1
Exhibit 4.4
TASC
PROFIT SHARING AND STOCK OWNERSHIP PLAN
Working Copy of Plan Document
As amended and restated by the Twenty-Fourth Amendment
and as subsequently amended by the Twenty-Fifth Amendment
<PAGE> 2
TASC PROFIT SHARING AND STOCK OWNERSHIP PLAN
--------------------------------------------
TABLE OF CONTENTS
-----------------
Page
----
INDEX OF TERMS.............................................................. v
ARTICLE 1 INTRODUCTION................................................... 1
1.1 Amendment and Restatement of Plan.............................. 1
1.2 Compliance with Code and ERISA................................. 1
1.3 Exclusive Benefit of Participants.............................. 1
1.4 Limitation on Rights Created By Plan........................... 1
1.5 Application of Plan's Terms.................................... 1
1.6 Benefits Payable Only from Trust Fund.......................... 1
ARTICLE 2 DEFINITIONS.................................................... 2
2.1 Applicable compensation........................................ 2
2.2 Beneficiary.................................................... 2
2.3 Code........................................................... 2
2.4 Committee...................................................... 2
2.5 Employee....................................................... 2
2.6 Employer....................................................... 2
2.7 ERISA.......................................................... 3
2.8 Participant.................................................... 3
2.9 Plan........................................................... 3
2.10 Plan year...................................................... 3
2.11 Related company................................................ 3
2.12 Trust agreement................................................ 3
2.13 Trust fund..................................................... 3
2.14 Trustee........................................................ 3
ARTICLE 3 SERVICE RULES.................................................. 3
3.1 Year of Service................................................ 3
3.2 Hour of Service................................................ 4
3.3 Break in Service............................................... 4
3.4 Special Rules for Permissible Absences......................... 4
ARTICLE 4 PARTICIPATION.................................................. 5
4.1 Eligible Class................................................. 5
4.2 Participation.................................................. 5
4.3 End of Participation........................................... 6
4.4 Reentry of Former Active Participant........................... 6
ARTICLE 5 EMPLOYEE SAVINGS............................................... 6
5.1 Employee Savings............................................... 6
5.2 Changes in Employee Savings.................................... 8
5.3 Collection of Employee Savings................................. 8
i
<PAGE> 3
ARTICLE 6 ROLLOVER CONTRIBUTIONS......................................... 8
6.1 Rollover Contributions......................................... 8
ARTICLE 7 EMPLOYER CONTRIBUTIONS......................................... 9
7.1 Defined Contribution........................................... 9
7.2 Profit Sharing Contribution.................................... 9
7.3 Participants Eligible for Contributions........................ 10
7.4 Form and Time of Contribution.................................. 10
7.5 Excess Contributions........................................... 10
7.6 Return of Contribution Made in Error or Not Deductible......... 10
ARTICLE 8 ACCOUNTS AND CREDITS........................................... 10
8.1 Establishment of Accounts...................................... 10
8.2 Crediting Employee Savings..................................... 10
8.3 Crediting Employer Defined Contributions....................... 11
8.4 Crediting Profit Sharing Contributions......................... 11
8.5 Crediting Rollovers............................................ 11
8.6 Charges to Accounts............................................ 11
ARTICLE 9 INVESTMENT FUNDS AND
CREDITING INVESTMENT EXPERIENCE................................ 11
9.1 Investment Funds............................................... 11
9.2 Participant-Directed Investments............................... 11
9.3 Valuation of Assets............................................ 12
9.4 Crediting Investment Experience................................ 12
ARTICLE 10 LOANS.......................................................... 13
10.1 Availability of Loans.......................................... 13
10.2 Borrowing Rules................................................ 13
10.3 Amount of Loans................................................ 13
10.4 Maximum Repayment Period....................................... 13
10.5 Security for Repayment......................................... 13
10.6 Repayment...................................................... 14
10.7 Action Upon Default............................................ 14
10.8 Distribution to Participant With Loan.......................... 14
10.9 Accounting for Loans........................................... 14
ARTICLE 11 IN-SERVICE WITHDRAWALS......................................... 15
11.1 In-Service Withdrawals from Rollover Accounts.................. 15
11.2 In-Service Withdrawals from Withdrawable Account............... 15
11.3 In-Service Withdrawals for Financial Hardship.................. 15
11.4 Withdrawals of Excess Employee Savings......................... 16
11.5 Withdrawals at or After Normal Retirement Date................. 17
11.6 Rules and Procedures........................................... 17
ARTICLE 12 DISTRIBUTIONS ............................................... 17
12.1 Distribution Upon Retirement or Disability..................... 17
12.2 Distribution Upon Termination of Employment.................... 17
12.3 Distribution Upon Death........................................ 18
12.4 Time of Distributions.......................................... 19
12.5 Manner of Payment.............................................. 20
ii
<PAGE> 4
12.6 Forms of Payment............................................... 20
12.7 Standard Form of Payment....................................... 20
12.8 Election of Optional Form of Payment........................... 20
12.9 Automatic Joint and Surviving Spouse Annuity
for Married Participant Who Does Not Elect
Otherwise...................................................... 21
12.10 Distribution Rules for Installment Payments.................... 21
12.11 Rehire Before Distribution..................................... 22
12.12 Direct Rollovers............................................... 22
ARTICLE 13 AMENDMENT, MERGER AND TERMINATION OF PLAN...................... 23
13.1 Amendment of Plan.............................................. 23
13.2 Merger of Plans................................................ 23
13.3 Termination.................................................... 23
13.4 Effect of Termination.......................................... 24
ARTICLE 14 NAMED FIDUCIARIES.............................................. 24
14.1 Identity of Named Fiduciaries.................................. 24
14.2 Responsibilities and Authority of Committee.................... 24
14.3 Responsibilities and Authority of Trustee...................... 24
14.4 Responsibilities of the Employer............................... 24
14.5 Responsibilities Not Shared.................................... 25
14.6 Procedure for Allocation and Delegation
of Responsibilities............................................ 25
14.7 Dual Fiduciary Capacity Permitted.............................. 25
14.8 Advice......................................................... 25
14.9 Actions by the Employer........................................ 25
14.10 Indemnification................................................ 26
ARTICLE 15 THE PLAN COMMITTEE............................................. 26
15.1 Appointment.................................................... 26
15.2 Notice to Trustee.............................................. 26
15.3 Administration of Plan......................................... 26
15.4 Impossible or Difficult Performance............................ 26
15.5 Compensation and Expenses...................................... 27
15.6 Committee Decisions, Rules and Regulations..................... 27
15.7 Secretary of the Committee..................................... 27
15.8 Claims Review Procedure........................................ 27
ARTICLE 16 MISCELLANEOUS.................................................. 27
16.1 Payment to Minors and Incompetents............................. 27
16.2 Nonalienation of Benefits...................................... 28
16.3 Current Address of Payee....................................... 28
16.4 Disputes over Entitlement to Benefits.......................... 28
16.5 Payment of Benefits............................................ 28
16.6 Maximum Additions.............................................. 28
16.7 Top Heavy Plan Provisions...................................... 29
16.8 Separate Accounts.............................................. 30
16.9 Voting and Tendering Rights of Primark Common Stock............ 30
16.10 Rules of Construction.......................................... 32
16.11 Text Controls.................................................. 32
iii
<PAGE> 5
16.12 Applicable State Law........................................... 32
Schedule A.................................................................. 33
iv
<PAGE> 6
INDEX OF TERMS
The items listed below are defined explained or clarified in the plan
sections or articles indicated.
Additional visiting .......................................................... 0
Adjusted account balance .................... ERROR! REFERENCE SOURCE NOT FOUND.
Annual additions ............................................................. 0
Applicable compensation ...................................................... 0
Automatic joint and surviving spouse annuity ................................. 0
Beneficiary ....................................................... 0, Article 0
Break in service ............................................................. 0
Code ......................................................................... 0
Claims procedure ............................................................. 0
Committee ......................................................... 0, Article 0
Deferral percentage .......................................................... 0
Disability ................................................................... 0
Distributions ........................................................ Article 0
Early retirement date ........................................................ 0
Eligible ..................................................................... 0
Eligibility for contributions ................................................ 0
Employee ..................................................................... 0
Employee savings accounts .................................................... 0
Employer ..................................................................... 0
Employer defined contributions .................................... Article 0, 0
Employer stock ............................................................... 0
End of participation ......................................................... 0
ERISA ........................................................................ 0
Financial hardship ........................................................... 0
Form and time of contribution ................................................ 0
401(k) limits ................................................................ 0
Highly-compensated employee .................................................. 0
Hour of service .............................................................. 0
Loans ................................................................ Article 0
Normal retirement date ....................................................... 0
Participant .................................................................. 0
Participation ................................................................ 0
Participants' employee savings .................................... Article 0, 0
Permissible absence .......................................................... 0
Plan ......................................................................... 0
Plan year .................................................................... 0
Profit sharing contribution .................................................. 0
v
<PAGE> 7
Related company .............................................................. 0
Return to active work ........................................................ 0
Rollover contributions ....................................................... 0
Segregated accounts ......................... ERROR! REFERENCE SOURCE NOT FOUND.
Separate accounts ............................................................ 0
Termination .................................................................. 0
Top heavy .................................................................... 0
Trust agreement .............................................................. 0
Trust fund ................................................................... 0
Trustee ................................................................... 0, 0
Valuation date ............................................................... 0
Withdrawals .......................................................... Article 0
Year of service .............................................................. 0
vi
<PAGE> 8
ARTICLE 1
INTRODUCTION
1.1 AMENDMENT AND RESTATEMENT OF PLAN. TASC established this plan effective
June l, 1967. The plan was amended from time to time thereafter, as specified in
Appendix A. Effective June 1, 1987, TASC amended and restated the plan. The
restatement changed the method of crediting employer profit sharing
contributions to participants' accounts and established a requirement for
certain defined employer contributions to participants' accounts. The amended
and restated plan was itself subsequently amended or restated from time to time
thereafter, also as specified in Appendix A.
1.2 COMPLIANCE WITH CODE AND ERISA. This document contains provisions which
are intended to qualify as a profit-sharing plan under Code Section 401(a) and a
qualified cash or deferred arrangement under Code Section 401(k). In addition,
the provisions requiring a defined contribution to participants' accounts are
intended to qualify as a money purchase pension plan under Code Section 401(a).
The provisions of this document are intended to comply with the applicable
requirements of ERISA.
Although for purposes of the Code this document contains two plans, unless
the portion of the plan which constitutes the money purchase pension plan or the
profit sharing plan is specifically referred to, the term "plan" is intended to
refer to the program of contributions and benefits hereunder as a whole.
1.3 EXCLUSIVE BENEFIT OF PARTICIPANTS. The plan is for the exclusive
benefit of participants and their beneficiaries. Employer contributions and
participants' employee savings are for the purpose of accumulating a fund for
distribution to participants and their beneficiaries in accordance with the
plan. Except as provided in Section 7.6, no part of the trust fund or any
distribution therefrom will be used for or diverted to purposes other than for
the exclusive benefit of participants and their beneficiaries and for defraying
those reasonable expenses of administering the plan and the trust fund not paid
by the employer.
1.4 LIMITATION ON RIGHTS CREATED BY PLAN. Nothing appearing in the plan
will be construed (a) to give any person any benefit, right or interest except
as expressly provided herein, or (b) to create a contract of employment or to
give any employee the right to continue as an employee or to affect or modify
his terms of employment in any way.
1.5 APPLICATION OF PLAN'S TERMS. Credits to a participant's accounts will
be governed by the terms of the plan that are in effect on the date that
employer contributions or employee savings are credited. The benefits and rights
of a participant and his beneficiaries under the plan on account of the
participant's retirement, disability, death or other termination of service will
be determined in accordance with the terms of the plan that are in effect on the
date of such event.
1.6 BENEFITS PAYABLE ONLY FROM TRUST FUND. Benefits will be paid only from
the assets of the trust fund and are limited to the amount of assets therein,
and it is a condition of participation in the plan that each participant and any
person claiming under a participant will look solely to such assets for the
payment of any benefits due him hereunder. The employer, the trustee and the
committee do not guarantee the payment of any specific amount of benefits
hereunder.
<PAGE> 9
ARTICLE 2
DEFINITIONS
This article contains a number of definitions of terms used in the plan.
Other terms are defined, explained or clarified in other articles. This is done
for convenience only, and there is no other significance to the location of a
definition.
2.1 APPLICABLE COMPENSATION of an employee for any period of reference is
his total compensation from the employer for services during such period with
the exclusions provided for in this section. Applicable compensation includes
bonuses and any other "extra" compensation from the employer for services
rendered by the employee (unless specifically excluded). Except for purposes of
Section 16.6, applicable compensation also includes employee savings hereunder
and any contributions to any other benefit program made on behalf of the
employee in accordance with a salary reduction agreement. However, applicable
compensation excludes overtime, imputed income attributable to employer-paid
group term life insurance, any sign-up bonus paid to the employee, payments in
respect of cancellation of excess vacation days, reimbursed expenses or any
other items not constituting direct compensation for services. For purposes of
determining the amount of employer contributions on a participant's behalf under
Article 7, a participant's applicable compensation will not include any
compensation for services during any period before he became a participant for
employer contributions under Section 4.2(b). Applicable compensation also does
not include payments to or benefits received under this or any other public or
private employee benefit plan (other than salary reduction contributions under
this plan or any other employee benefit program).
The amount of applicable compensation for any plan year taken into account
under the plan for a participant will not exceed the maximum amount applicable
to such year under Code Section 401(a)(17) and the regulations thereunder.
2.2 BENEFICIARY means a person, class of persons or trust designated by a
participant, or by the plan if the participant does not do so, to receive a
death benefit hereunder.
2.3 CODE means the Internal Revenue Code of 1986, as amended from time to
time, or any successor statute enacted in its place.
2.4 COMMITTEE means the committee constituted under Article 0 to administer
the plan.
2.5 EMPLOYEE means a person employed by the employer as a common law
employee.
2.6 EMPLOYER means TASC, Inc. (sometimes referred to herein as "TASC") or
any successor organization to it that continues the plan for its employees, and
any other entity that adopts the plan for its employees with the consent of TASC
upon such terms and conditions as TASC may impose. In the event that employers
in addition to TASC are participating in the plan in accordance with the
preceding paragraph, only TASC is considered the employer in any case in which
this plan document provides for the exercise of discretion in plan operation,
including the appointment of a trustee, committee member, or the amendment or
termination of the plan. However, any such other employer may by appropriate
action withdraw from the plan.
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<PAGE> 10
2.7 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time, or any successor statute enacted in its place.
2.8 PARTICIPANT means an employee whose participation in the plan has begun
and has not yet ended. Where the context so indicates, the term PARTICIPANT also
includes a former employee who has not yet received payment of his total vested
account balances.
2.9 PLAN means the TASC Profit Sharing and Stock Ownership Plan, as set
forth in this document and as it may be amended from time to time. See Section
1.2 for a description of the plan.
2.10 PLAN YEAR means the 7-consecutive month period beginning June 1, 1993
and ending December 31, 1993, and the 12-consecutive month periods beginning on
January 1, 1994 and each January 1 thereafter during the continuance of the
plan.
2.11 RELATED COMPANY means (a) any corporation (other than the employer)
that is included in a controlled group of corporations (as defined in Code
Section 414(b)) with the employer, (b) any unincorporated trade or business that
is under common control with the employer within the meaning of Code Section
414(c), or (c) any organization that is included within an affiliated service
group (within the meaning of Code Section 414(m)) with the employer.
2.12 TRUST AGREEMENT means the instrument executed by the employer and the
trustee, as amended from time to time, fixing the rights and responsibilities of
each party with respect to the holding, investment and administration of the
trust fund.
2.13 TRUST FUND means the property held by the trustee for the purposes of
the plan.
2.14 TRUSTEE means the person, individual or corporate, serving as sole
trustee, or the persons serving as co-trustees, at any time under the terms of
the trust agreement.
ARTICLE 3
SERVICE RULES
3.1 YEAR OF SERVICE. A year of service of an employee is a 12-month
computation period during which he completes at least 1,000 hours of service. An
employee's initial 12-month computation period will begin on his date of hire
(or rehire after a break in service), and subsequent computation periods will
begin on the anniversary of his date of hire (or rehire after a break in
service).
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<PAGE> 11
3.2 HOUR OF SERVICE.
(a) An hour of service of an employee means an hour for which he is
directly or indirectly paid or entitled to payment by the employer (or a related
company) for the performance of duties, or for reasons (such as vacation,
holidays, sickness, disability, or leave of absence) other than the performance
of duties, or for which back pay has been awarded or agreed to by the employer
(or a related company) unless such hours were already credited under the
preceding provisions of this sentence. Hours earned for the performance of
duties will be credited to the computation period in which the duties are
performed. Hours earned for other than the performance of duties will be
credited to the computation period in which amounts payable become due. Hours
earned for back pay awards or agreements will be credited to the computation
period to which the award or agreement pertains. All hours will be credited in
compliance with Department of Labor Regulations Section 2530.200b-2(b) and (c).
(b) To facilitate plan administration, each employee regularly
scheduled to work three-quarters or more of a full-time schedule will
automatically be credited with 190 hours of service during each month that he
would be credited with one hour of service under (a) above.
3.3 BREAK IN SERVICE. A break in service of an employee is a 12-month
computation period during which he fails to complete at least 501 hours of
service. The computation periods specified in Section 3.1 for determining a year
of service will also be used for determining a break in service.
If an employee incurs a break in service and subsequently returns to
service as an employee, his years of service before and after such break will be
counted for purposes of computing his vested interest in his accounts.
3.4 SPECIAL RULES FOR PERMISSIBLE ABSENCES.
(a) ELIGIBILITY FOR CONTRIBUTIONS. If a participant is on a permissible
absence, he will be eligible to share in any employer contributions that are
credited under Sections 7.1 to 7.3 on a date which falls during such absence.
Any amount so credited is conditioned upon the participant's return to active
work with the employer no later than the end of his permissible absence; if the
participant does not do so, any such conditional credits will be revoked and
treated as a forfeiture to be reallocated to participants' accounts in
accordance with Section 12.2(d).
(b) EFFECT OF PERMISSIBLE ABSENCE. For purposes of vesting and
participation eligibility, a participant on a permissible absence for military
service under subsection (c)(i)(A) below (but not a participant on sickness or
disability absence or other authorized absence under subsection (c)(i)(B) or (C)
below) will continue to be credited with the number of hours of service in his
normal scheduled work week before his absence for each week of permissible
absence, provided he returns to active work with the employer no later than the
end of the permissible absence. The preceding sentence will not apply to a
participant who fails to return to active work with the employer by the end of
the permissible absence, and such participant's employment will be deemed to
have terminated on the first day of his permissible absence for purposes of
determining his vested interest in his accounts under Section 12.2.
(c) DEFINITIONS.
(i) A PERMISSIBLE ABSENCE means an employee's unpaid absence from
active work:
(A) for military service in the armed forces of the United
States for a period and in a capacity such that his reemployment rights
are protected by federal law, unless and until the employee is
discharged from such military service or ceases to be on active duty
and does not within 90 days thereafter, or within such longer period
thereafter as his reemployment rights are protected by federal
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<PAGE> 12
law, return to active work with the employer;
(B) for a period not in excess of 12 months on account of bona
fide sickness or temporary disability;
(C) any other absence authorized by the employer in accordance
with its established policies and procedures, provided that all
participants under similar circumstances are treated alike.
(ii) For purposes of this section, RETURN TO ACTIVE WORK means (A)
the employee resumes performing his duties with the employer and (B) he
completes at least 1,000 hours of service during the one-year period
starting when he resumes performing his duties.
ARTICLE 4
PARTICIPATION
4.1 ELIGIBLE CLASS. Each employee is in the class eligible to participate
unless he is classified as a temporary employee (such as a student in an
educational cooperative program or an employee who is hired for a limited period
to help with a temporary work overflow) under the employer's regular personnel
practices, or he is classified as a consultant under the employer's normal
personnel policies and practices, or he is a person treated as an employee under
Code Section 414(n).
4.2 PARTICIPATION.
(a) PARTICIPANT FOR EMPLOYEE SAVINGS. An employee in the eligible class
may become a participant for purposes of making employee savings under Article 5
on his date of hire or on the first day of any month following his date of hire,
provided that he is an employee in the eligible class on such day and provided
that he is expected to complete at least 1,000 hours of service during the next
12 months.
(b) PARTICIPANT FOR EMPLOYER CONTRIBUTIONS. An employee in the eligible
class will become a participant for purposes of being eligible for employer
contributions under Article 7 (subject to the applicable provisions of Article
7) on the first day of the month coinciding with or next following the date he
completes one year of service, provided that he is an employee in the eligible
class on such first day. For this purpose, a year of service under Section 3.1
is not completed before the last day of the 12-month computation period
regardless of when during such period the employee completes 1,000 hours of
service.
If an employee who is not in the eligible class is reclassified as an
eligible employee, he will become a participant for purposes of eligibility for
employer contributions under Article 7 when he is reclassified if he has already
completed at least one year of service and he would have become a participant
for such purposes already had he always been an eligible employee.
References to "participant" in Article 7 (or other provisions of the
plan relating to an employer contribution) mean an eligible employee who has
completed at least one year of service and who has become a participant in
accordance with this subsection (b).
[(c) EFFECTIVE DATE. The provisions of subsections (a) and (b) above
will apply to employees with hire dates of June 1, 1992 or later; employees with
hire dates before June 1, 1992 will continue to be governed by the provisions of
Section 4.2 as in effect before the Twenty-First Amendment. For this purpose, an
employee's HIRE
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<PAGE> 13
DATE is the date he first completes an hour of service; however, an individual
who received a written offer of employment from the employer before May 14, 1992
and who accepts the offer no later than May 28, 1992 will for this purpose be
deemed to have a hire date before June 1, 1992.]
4.3 END OF PARTICIPATION. A participant's active participation in the plan
will end when his employment as an eligible employee ends for any reason. His
participation will end when he has no further interest under the plan.
4.4 REENTRY OF FORMER ACTIVE PARTICIPANT. A former active participant who
returns to service as an eligible employee will resume his active participation
in the plan on the date of his return, provided that he is expected to complete
at least 1,000 hours of service during the next 12 months. If such a former
participant who is not expected to do so nevertheless completes 1,000 hours of
service, he will become a participant retroactively to the date of his return.
ARTICLE 5
EMPLOYEE SAVINGS
5.1 EMPLOYEE SAVINGS.
(a) PARTICIPANTS' EMPLOYEE SAVINGS. Each participant may make employee
savings to the plan in any whole percentage of his applicable compensation
(exclusive of any items of imputed income) he elects by agreeing to reduce his
applicable compensation by such amount, provided that his employee savings do
not exceed any ceiling imposed by the employer on employee savings by
highly-compensated employees or other employees or result in a violation of the
requirements of subsection (c) or the limitations of Section 16.6. Such amounts
are referred to herein as the participant's EMPLOYEE SAVINGS.
(b) SIGN-UP PROCEDURE FOR EMPLOYEE SAVINGS. A participant who wishes to
make employee savings must complete a form specifying the amount of his employee
savings, agreeing to reduce his applicable compensation by such amount, and
providing such other information as the employer may require. A participant will
be given the opportunity to elect to make employee savings on his date of
participation. If the participant elects to begin employee savings immediately,
his employee savings will begin on the first day of the month coincident with or
next following the date after he files his election with the employer. If the
participant declines to make immediate employee savings, he may elect to begin
making employee savings as of the first day of any month coincident with or next
following the date he files the required form with the employer.
(c) 401(K) LIMITS.
(i) LIMITS. Employee savings by highly-compensated employees must
not exceed such amounts that, as of the last day of each plan year, the
average of the individual deferral percentages of the highly-compensated
employees (the "HDP") does not exceed the average of the individual
deferral percentages of all other employees (the "AODP") by more than the
amount specified under the following table:
If AODP Is: HDP may not exceed:
----------- -------------------
Less than 2% 2 times AODP
At least 2% but 2% more than AODP
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<PAGE> 14
less than 8%
8% or higher 1.25 times AODP
In addition, the employee savings of a participant for any calendar year
will be limited to $7,000 (as adjusted in accordance with Code Section 402
(g)).
(ii) MONITORING AND ADJUSTING EMPLOYEE SAVINGS. The employer will
monitor participants' employee savings elections and deferral percentages
and will adjust the amount of employee savings elected or made by
highly-compensated employees to the extent necessary to satisfy subsection
(i) above. Any necessary adjustment will be accomplished by reducing the
employee savings of the participant (or participants) in the
highly-compensated group with the highest deferral percentage first, next
the participant (or participants) in such group with the second highest
deferral percentage, and so on until subsection (i) is satisfied.
Such adjustments will be made by the employer at such time or times
as the employer determines, and will be made in accordance with procedures
established by the employer. If necessary, the employer will direct
repayment to a highly-compensated employee of the amount by which his
employee savings for a plan year exceed the amount permitted under
subsection (i) above, plus earnings on such amount. Such repayment will be
made no later than the end of the succeeding plan year.
(iii) HIGHLY-COMPENSATED EMPLOYEES DEFINED. An employee is
considered a HIGHLY-COMPENSATED EMPLOYEE for a plan year if at any time
during the plan year or the preceding plan year he:
(A) owns (or is considered to own within the meaning of Code
Section 318) more than 5% of the outstanding stock of the employer;
(B) received annual compensation from the employer in excess
of $75,000 (before any reductions in his compensation in accordance
with a salary reduction agreement);
(C) received annual compensation from the employer in excess
of $50,000 (before any reductions in his compensation in accordance
with a salary reduction agreement) and is in the highest paid 20% of
all employees; or
(D) is an officer of the employer having annual compensation
greater than 50% of the amount in effect under Section 415(b)(1)(A) of
the Code for the year (but no more than 50 employees will be considered
highly-compensated employees under this subsection (D)).
The $75,000 and $50,000 amounts in (B) and (C) above will be
adjusted for cost-of-living increases in accordance with Code Section
414(q). In determining the highly-compensated employees for a plan year,
the rules specified in Section 414(q)(2), (6) and (8) will be applied. As
provided in the regulations under Code Section 414(q), in making such
determination, the employer may elect to treat the determination year and
the lookback year as the same and make such determinations based upon the
plan year in question.
(d) DEFERRAL PERCENTAGE DEFINED. For purposes of subsection (c) above,
the DEFERRAL PERCENTAGE of a participant for a plan year means his employee
savings, if any, for such plan year computed as a percentage of his compensation
(as reportable on Form W-2) for such year. If a participant does not make any
employee savings for a plan year, his deferral percentage for such year is zero.
(e) CHARACTER OF EMPLOYEE SAVINGS. For purposes of Code Section 414(h),
it is specifically provided that employee savings are employer contributions.
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<PAGE> 15
5.2 CHANGES IN EMPLOYEE SAVINGS.
(a) PARTICIPANT CHANGES. A participant making employee savings may
increase or decrease the rate of his employee savings to any other rate he
elects (subject to the limitations stated in Section 5.1(a)) by so specifying on
a form filed with the employer; this may include a suspension of employee
savings or a resumption of previously suspended employee savings. The increase
or decrease will become effective on the first day of the month coincident with
or next following the date after he files his form with the employer.
(b) EMPLOYER RULES. The employer may establish such rules and
procedures for employee savings as the employer deems advisable for the
efficient administration of the plan. The employer's rules may provide that any
commencement or change in a participant's employee savings will be effective on
the first day of the payroll period coinciding with or next following the
applicable change date, or may provide for reducing or waiving the 10 day
advance notice requirement in any case or class of cases. The employer's rules
may provide a limit on the number of changes any participant may make in a plan
year or may include other restrictions on changes that the employer deems
advisable.
5.3 COLLECTION OF EMPLOYEE SAVINGS. The employer will collect participants'
employee savings through payroll or other procedures and will deliver the
amounts collected to the trustee monthly.
ARTICLE 6
ROLLOVER CONTRIBUTIONS
6.1 ROLLOVER CONTRIBUTIONS.
(a) With the approval of the employer, an employee may make a rollover
contribution to the plan (or cause to be transferred to the trustee directly (a
"direct rollover") from a qualified trust, qualified annuity plan, individual
retirement account or individual retirement annuity) in an amount which
constitutes (i) a rollover contribution (as defined in Code Section 408(d)(3));
(ii) all or part of an eligible rollover distribution (as defined in Code
Section 401(a)(31), 402(c)(4) or 403(a)(4)); or (iii) a trustee to trustee
transfer (other than a direct rollover) of all or part of his interest in such a
plan or account. However, a transfer to this plan of accumulated deductible
employee contributions made under another plan will not be permitted.
(b) The employer, the committee and the trustee have no responsibility
for determining the propriety of, proper amount or time of, or status as a
tax-free transaction of any transfer under subsection (a) above.
(c) The employer in its discretion may direct the return to the
employee (or the retransfer to another trustee or custodian designated by the
employee) of any rollover contributions or transfers to the extent the employer
determines that such return is necessary to insure the continued qualification
of this plan under Section 401(a) of the Code or that holding such rollover
contribution would be administratively burdensome.
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<PAGE> 16
ARTICLE 7
EMPLOYER CONTRIBUTIONS
7.1 DEFINED CONTRIBUTION. For each plan year, the employer will make a
contribution equal to 2% of the applicable compensation for such year of each
participant specified in Section 7.3. The employer contribution for a plan year
required by this section will be reduced by any forfeitures occurring during
such year under Section 3.4(a) and Section 12.2(c). The employer's contribution
under this section is called the employer DEFINED CONTRIBUTION.
7.2 PROFIT SHARING CONTRIBUTION.
(a) AMOUNT. For each plan year, the employer may make a profit sharing
contribution in such amount, if any, as the employer in its discretion
determines, subject to the limitations of Section 16.6.
(b) ALLOCATION OF PROFIT SHARING CONTRIBUTION. The employer's profit
sharing contribution (if any) for a plan year and any forfeitures occurring
during the plan year and not applied under Section 7.1 will be credited to the
accounts of eligible participants (as specified in Section 7.3) as follows:
(i) STEP ONE. Each eligible participant will receive an allocation
in the proportion that his applicable compensation for the plan year in
excess of the threshold specified below bears to the aggregate of such
excess applicable compensation for such year for all eligible participants.
The maximum amount allocated to any participant under this step will be a
percentage of his excess applicable compensation; the percentage will be
the employer OASDI tax rate under Code Section 3111 as in effect at the
beginning of the plan year, but not higher than 5.4%. The threshold is
equal to the Social Security taxable wage base in effect for the plan year.
However, the amount allocated under this Step One will never exceed an
amount such that the allocation as a percentage of a participant's excess
applicable compensation is greater than the Step Two allocation as a
percentage of a participant's applicable compensation. The amount to be
allocated under Step One will be reduced and instead allocated under Step
Two to the extent (but only to such extent) necessary to meet the
requirements of the preceding sentence.
The amount allocated under this subsection (i) will be
credited to his basic account. [For the June 1 to December 31, 1993 plan
year, the threshold is equal to seven-twelfths of the Social Security
taxable wage base for 1993.]
(ii) STEP TWO. If any of the employer's profit sharing contribution
for a plan year remains after Step One (or is reallocated from Step One as
described above), each eligible participant will receive an allocation in
the proportion that his applicable compensation for such year bears to the
aggregate applicable compensation for such year of all eligible
participants.
The amount allocated under this subsection (ii) will be
credited to his withdrawable account, up to a maximum of four percent of
his applicable compensation; any additional amount allocated under this
subsection (ii) (exceeding four percent of his applicable compensation for
such year) will be credited to his basic account.
7.3 PARTICIPANTS ELIGIBLE FOR CONTRIBUTIONS. A participant is eligible to
share in the employer's defined contribution and profit sharing contribution for
a plan year if he is a participant on the last regularly scheduled work day of
such plan year and he completed at least 1,000 hours of service during such plan
year (or a prorated portion of 1,000 if he was an eligible employee for only
part of such year).
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<PAGE> 17
The requirements in the preceding sentence will not apply if (a) the
participant's status as an employee ended during the plan year due to
retirement, death or disability, or transfer to a related company, or (b) the
participant is on a permissible absence on the last day of the plan year, as
provided in Section 3.4.
7.4 FORM AND TIME OF CONTRIBUTION. The employer's contributions for a plan
year will be paid to the trustee in cash or other property acceptable to the
trustee. Such contributions will be paid to the trustee no later than the due
date (including extensions) for filing the employer's federal income tax return
for such year.
7.5 EXCESS CONTRIBUTIONS. If, due to miscalculation or error, the
employer's contributions for a plan year exceed the amount provided for
hereunder or determined by the employer, such excess may be treated as a
contribution for the succeeding plan year or years.
7.6 RETURN OF CONTRIBUTION MADE IN ERROR OR NOT DEDUCTIBLE. Each employer
contribution hereunder is conditioned upon the requirement that the amount of
the contribution will be deductible under Code Section 404. If all or part of an
employer contribution is made because of a mistake of fact or if the deduction
under Code Section 404 of any portion of an employer's contribution is
disallowed, the amount contributed because of a mistake of fact or the amount
for which the deduction is disallowed will be returned to the employer if the
employer makes demand therefor within the time allowed by law.
ARTICLE 8
ACCOUNTS AND CREDITS
8.1 ESTABLISHMENT OF ACCOUNTS. The employer will establish and maintain in
the name of each participant such of the following accounts as are appropriate
for the participant:
(a) employee savings account;
(b) defined contribution account;
(c) basic account;
(d) withdrawable account; and
(e) rollover account.
Credits and charges to such accounts will be made as provided in the plan.
8.2 CREDITING EMPLOYEE SAVINGS. Employee savings by a participant will be
credited to his employee savings account when such employee savings are received
by or for the account of the trustee.
8.3 CREDITING EMPLOYER DEFINED CONTRIBUTIONS. The employer's defined
contribution under Section 7.1 on behalf of a participant, equal to 2% of his
applicable compensation, will be credited to his defined contribution account
when received by or on behalf of the trustee.
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<PAGE> 18
8.4 CREDITING PROFIT SHARING CONTRIBUTIONS. A participant's share of the
employer's profit sharing contribution under Section 7.2 will be credited to his
basic account and withdrawable account (as specified in Section 7.2) when
received by or on behalf of the trustee.
8.5 CREDITING ROLLOVERS. Rollovers by or on behalf of an employee under
Section 6.1 will be credited to his rollover account when received by or on
behalf of the trustee.
8.6 CHARGES TO ACCOUNTS. Any amount distributed, paid, withdrawn or
transferred from an account will be a charge against such account as of the date
of distribution, payment, withdrawal or transfer.
ARTICLE 9
INVESTMENT FUNDS AND CREDITING INVESTMENT EXPERIENCE
9.1 INVESTMENT FUNDS. The employer may direct the trustee to establish one
or more separate investment funds within the trust fund and to invest each such
separate investment fund in different types or categories of assets (e.g.,
equities or fixed-income securities, or shares of specified mutual funds, or
publicly traded shares of common stock of the employer's parent) or in
accordance with investment objectives specified by the employer. The employer
may add or delete separate investment funds in its discretion.
The employer will maintain (or will cause to be maintained by the
trustee or a service provider or third party administrator) records which
reflect the portion of each account that is invested in each separate investment
fund. The existence of such records and of participants' accounts will not be
deemed to give any person any right, title or interest in or to any specific
assets or part of the trust fund or any separate investment fund.
9.2 PARTICIPANT-DIRECTED INVESTMENTS.
(a) PARTICIPANT INVESTMENT DIRECTIONS. Each participant may direct the
investment of his accounts among the separate investment funds established under
Section 9.1. However, the amount in a participant's defined contribution account
may not be invested in an investment fund consisting of stock of the employer
(or its parent or another affiliate).
A participant may initially direct the investment of his accounts
entirely in one investment fund or in a combination of two or more of the
investment funds as specified in an investment election form filed with the
employer, provided that combinations must be in such minimum increments as are
specified in the rules and procedures governing participant investment choices
adopted by the employer (or, if applicable, the trustee or service provider or
third party administrator) from time to time.
(b) RESPONSIBILITY FOR INVESTMENTS. The participant will have sole
responsibility for any investment direction given under subsection (a), and no
named fiduciary or other person will have any liability for any loss or
diminution in value resulting from the participant's exercise of such investment
responsibility. It is intended that Section 404(c) of ERISA will apply to a
participant's investment directions under this section.
(c) ABSENCE OF INVESTMENT DIRECTIONS. If a participant does not file an
investment election form with
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the employer, his accounts will be invested in the balanced fund (or the most
nearly equivalent fund if there is no balanced fund), and his failure to file an
investment election form will be deemed to be an election of such fund.
(d) CHANGES IN INVESTMENT DIRECTIONS. A participant may change his
investment directions (either as to the investment of future contributions to
his accounts or as to the transfer of amounts invested in one separate
investment fund to another fund or funds) in such manner and at such times as
may be permitted under the investment rules and procedures.
9.3 VALUATION OF ASSETS. As of the last day of each plan year and at any
other time that the employer directs (referred to herein as a VALUATION DATE),
the trustee will determine the fair market value of the assets in each separate
investment fund of the trust fund, relying upon such evidence of value as the
trustee deems appropriate. The employer may establish different valuation dates
for different classes of plan investments (for example, the employer may direct
that the fair market value of separate investment funds consisting of
investments in open-end mutual funds will be valued at the end of each business
day).
9.4 CREDITING INVESTMENT EXPERIENCE. As of each valuation date (before
crediting any employer contributions, employee savings or rollovers to
participants' accounts as of such date), expenses not paid by the employer,
investment income and gains and losses in asset values in each separate
investment fund since the preceding valuation date will be credited or charged
to participants' accounts invested in such fund. The allocation of expenses and
investment results will be in proportion to the adjusted account balances in
such fund as of such valuation date. The ADJUSTED ACCOUNT BALANCE of an account
invested in a separate investment fund is the amount in such account as of the
close of business on the preceding valuation date, increased by one-half of any
employee savings credited to such account and decreased by any withdrawals or
distributions from such account since the preceding valuation date, and further
increased or decreased in accordance with any uniform rules established by the
employer to allocate expenses and investment results fairly. Notwithstanding the
preceding two sentences, if at any time the plan is being administered with
daily valuation dates and investments in shares of open-end mutual funds and/or
an investment fund consisting of publicly traded common stock of the employer
(or its parent or other affiliate), investment income and gains or losses will
be automatically credited to participants' accounts as a consequence of the
daily determination of the net asset value of the open-end mutual fund shares
and/or the daily value at the close of each business day of the shares of
publicly traded common stock of the employer (or its parent or other affiliate)
and the reinvestment of dividends thereon in additional shares.
ARTICLE 10
LOANS
10.1 AVAILABILITY OF LOANS. Loans will be available to all participants on
a reasonably equivalent basis under uniform, nondiscriminatory borrowing rules
or guidelines established by the employer (or by the trustee or a service
provider or third party administrator providing loan services). A participant's
loan application that meets the requirements for a loan hereunder will be
processed and the requested loan will be made to the participant. Any loan
hereunder will bear a reasonable rate of interest and will be evidenced by a
promissory note signed by the participant. In addition, a married participant's
application must contain his spouse's consent (which meets the requirements of
Section 12.9(b)(iii)) if any portion of the participant's defined contribution
account will be used for the loan.
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10.2 BORROWING RULES. The employer (or the trustee or a service provider or
a third party administrator providing loan services) may adopt borrowing rules
for loans hereunder and may revise such rules from time to time. Such rules may
contain such requirements pertaining to loans as are deemed necessary or
desirable and which are not specified herein. The borrowing rules may govern the
procedures and cut-off dates for applying for loans hereunder and the terms of
such loans, including (a) the number of loans that a participant may request in
any year and the number of loans that may be outstanding at any time to a
participant, (b) any restrictions on reborrowings not stated in this section,
(c) the interest rate in effect from time to time for loans or the method of
ascertaining such interest rate, (d) the repayment schedule for loans or the
method for determining the repayment schedule, and (e) any additional security
(besides the participant's account balances) for the repayment of loans.
10.3 AMOUNT OF LOANS. The maximum loan amount that may be outstanding to a
participant will be the smaller of (a) one-half of the participant's vested
account balances or (b) $50,000 (reduced by the highest outstanding loan balance
during the one-year period ending on the date of the current loan). For purposes
of applying such limits, account values as of the date when the participant
requests the loan will be used. The minimum loan will be such amount as may from
time to time be reflected in the borrowing rules (but not more than $1,000).
10.4 MAXIMUM REPAYMENT PERIOD.
(a) OTHER THAN RESIDENTIAL LOANS. Except as provided in subsection (b)
below, the maximum term of a loan will be five years (provided that a shorter
repayment period may be provided in the borrowing rules for small loans).
(b) RESIDENTIAL LOANS. If a participant requests a loan for the
acquisition of his principal residence, the repayment period will be determined
by reference to bank loans for the same purpose.
10.5 SECURITY FOR REPAYMENT. Each loan hereunder will be a
participant-directed investment for the benefit of the participant requesting
such loan; accordingly, any default in the repayment of principal or interest of
any loan hereunder will reduce the amount available for distribution to such
participant (or his beneficiary). Thus, any loan hereunder will be effectively
and adequately secured by the vested amount in the participant's accounts.
10.6 REPAYMENT. The employer may require a participant to execute an
agreement to repay the principal and interest of a loan through regular payroll
deduction payments from the participant's compensation. The employer may
establish back-up repayment procedures for participants who do not make payroll
deduction repayment; except as may otherwise be permitted under applicable
regulations, any such back-up procedures will provide for substantially level
amortization payments made at least quarterly. Any loan hereunder may be
prepaid, in whole or in part, at any time without penalty.
Each loan hereunder will provide that, if a participant voluntarily or
involuntarily terminates employment with a loan outstanding, the loan will be
due and payable in full at the end of the month following the calendar quarter
during which the participant terminated employment. However, if the
participant's employment was involuntarily terminated by the employer, and the
participant demonstrates to the committee's satisfaction that immediate
repayment of the outstanding loan as provided in the preceding sentence would
involve financial hardship, the committee may extend for up to six months the
date for full payment of the loan. During the period between the participant's
termination of employment and the due date for full payment of his loan under
this paragraph, the participant must continue making loan repayments in
accordance with the repayment schedule in effect before his termination of
employment.
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10.7 ACTION UPON DEFAULT. If a participant defaults on any payment of
interest or principal of a loan hereunder or defaults upon any other obligation
relating to such loan, the employer may take (or direct the trustee to take)
such actions as it determines to be necessary to protect the interests of the
plan. Such actions may include commencing legal proceedings against the
participant or foreclosing on any security interest in the participant's
account; however, the employer will not direct foreclosure on the participant's
employee savings account, defined contribution account or basic account at a
time when the participant would not be entitled to withdraw from or receive a
distribution from these accounts under Article 0.
10.8 DISTRIBUTION TO PARTICIPANT WITH LOAN. In the case of any participant
with a loan outstanding hereunder, the amount available for distribution to such
participant (or his beneficiary) will consist of the portion of his accounts
invested in the investment funds of the trust fund. In addition, the
participant's note will be distributed to him (or his beneficiary), and the
trustee will report the value of the note as the amount of unpaid principal and
interest due thereon at the date of distribution.
10.9 ACCOUNTING FOR LOANS. The employer (or the trustee or service provider
or third party administrator providing loan services) will establish rules
governing the procedures and ordering rules for liquidating the participant's
accounts to make a loan to him.
The employer (or the trustee, service provider or third party
administrator) will establish and maintain a loan account for each borrowing
participant. The unpaid principal and accrued but unpaid interest on loans to a
participant will be reflected for plan accounting purposes in the participant's
loan account. Repayments by the participant will be credited to his loan
account. The employer (or the trustee, service provider or third party
administrator) will establish uniform procedures for transferring repayment
amounts from his loan account to the participant's other accounts.
ARTICLE 11
IN-SERVICE WITHDRAWALS
11.1 IN-SERVICE WITHDRAWALS FROM ROLLOVER ACCOUNTS.
(a) AMOUNT. A participant with a rollover account may elect to
withdraw from his rollover account any amount he specifies up to the total
amount in his rollover account. A request for an in-service withdrawal under
this section will be in writing to the employer on such form as the employer
may prescribe.
(b) PAYMENT. Such an in-service withdrawal by a participant will be
paid to him as soon as practicable after he files his withdrawal request.
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11.2 IN-SERVICE WITHDRAWALS FROM WITHDRAWABLE ACCOUNT.
(a) AMOUNT. A participant may withdraw from his withdrawable account
any amount he specifies up to a maximum equal to his vested interest in such
account, provided (i) that the maximum amount withdrawable under this section in
any plan year is $25,000, (ii) that no employer profit-sharing contribution may
be withdrawn from such account until it has been on deposit in the trust fund
for at least two years, and (iii) that amounts attributable to cash option
amounts in old Account B transferred to the participant's withdrawable account
may not be withdrawn under this section. A request for such an in-service
withdrawal will be made in writing to the employer on such form as the employer
may prescribe.
(b) PAYMENT. An in-service withdrawal by a participant will be paid to
him as soon as practicable after he files his withdrawal request.
11.3 IN-SERVICE WITHDRAWALS FOR FINANCIAL HARDSHIP.
(a) APPLICATION. A participant may apply to the committee for a
withdrawal in case of financial hardship. The participant will file a written
application setting forth the specific immediate and significant financial need
prompting his request, the amount needed to meet such financial need, the
unavailability of other financial resources of the participant to meet such
need, and such other information as may be needed under this section or as the
committee may request. In determining whether a participant has a financial
hardship, the amount of his need and the unavailability of other resources to
meet the need, the committee may reasonably rely on the participant's
representations set forth in his application.
(b) FINANCIAL HARDSHIP DEFINED.
(i) IN GENERAL. Financial hardship means a participant's immediate
and significant need of money to meet an unusual or special situation in
his financial affairs ("need") for which other resources are not reasonably
available so that the hardship withdrawal is necessary to meet the need
("necessity").
(ii) NEED. Need of funds for the following will constitute
financial hardship: (A) medical expenses incurred by the participant or his
spouse or dependent; (B) purchase of the participant's principal residence
(not including mortgage payments); (C) tuition payments for up to the next
12 months of post-secondary education for the participant or his spouse,
child or dependent; (D) rent or mortgage payments to prevent the
participant's eviction from or the foreclosure of the mortgage on his
principal residence; or (E) such other events or circumstances as the
Internal Revenue Service specifies in rulings or regulations.
If the participant's financial need is not listed in the preceding
paragraph, the participant must show in his application facts and
circumstances amounting to a similar immediate and significant need.
In addition to the amount needed to meet the financial hardship,
the participant may request to withdraw the amount needed to pay income
taxes (and any penalties) on the withdrawal.
(iii) NECESSITY. The participant must show in his application that
the amount of the withdrawal is not in excess of the amount required to
meet the financial need and that the participant cannot meet the need from
other reasonably available financial resources, such as insurance proceeds,
reasonable liquidation of other assets, in-service withdrawals under
Section 11.1, 11.2 or 11.5 (if available), or loans available under Article
0 (or distributions or nontaxable loans from any other plan in which he
participates), or borrowing from other sources on reasonable terms, or
through cessation of employee savings hereunder.
A withdrawal will be deemed necessary to satisfy the participant's
financial need if either (A) the
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participant has made all non-hardship withdrawals and obtained all
nontaxable loans available under this plan; or (B) the participant
satisfies such other requirements as may be prescribed by the Internal
Revenue Service.
Notwithstanding Section 5.1, a participant who makes a hardship
withdrawal under this section and who established that such withdrawal was
necessary under the deemed necessary method described in the preceding
paragraph may not make employee savings hereunder (or under any other plan
maintained by the employer) for a period of 12 months following the date of
the in-service withdrawal. Also, in the calendar year following the date of
the withdrawal, such a participant may not make employee savings which,
when added to his employee savings during the calendar year of the
withdrawal, exceed the amount specified in the last sentence of Section
5.1(c)(i).
(c) MAXIMUM WITHDRAWAL. The maximum amount available for hardship
withdrawal is the sum of:
(i) the amount in the participant's employee savings account
as of November 30, 1988, plus the participant's employee savings after such
date (but not earnings on such account after such date); plus
(ii) the vested amount in the participant's basic account;
plus
(iii) the vested amount in the participant's withdrawable
account (to the extent not already withdrawn under Section 11.2).
(d) PAYMENT. If approved by the committee, a hardship withdrawal
will be paid to the participant as soon as practicable taking into account
the needs of the participant and the efficient administration of the plan.
11.4 WITHDRAWALS OF EXCESS EMPLOYEE SAVINGS. If a participant's employee
savings under Section 5.1 for a calendar year exceed $7,000 (as adjusted in
accordance with Code Section 402(g)) because he also participated in another
employer's 401(k) plan or other arrangement under Code Section 408(k) or 403(b)
during such year, the participant may request to withdraw all or part of such
excess. Such a request must be in writing and filed with the employer no later
than the March 1 following such calendar year. Such a withdrawal will be paid to
the participant as soon as practicable after his request and will include income
and investment gain or loss allocable to such withdrawn amount.
11.5 WITHDRAWALS AT OR AFTER NORMAL RETIREMENT DATE.
(a) AMOUNT. At or after a participant's normal retirement date (as
defined in Section 12.1(b)), he may withdraw from his accounts any amount he
specifies up to the full amount in his accounts. A request for such an
in-service withdrawal will be made in writing to the employer on such form as
the employer may prescribe.
(b) PAYMENT. An in-service withdrawal by a participant under this
section will be paid to him as soon as practicable after he files his withdrawal
request."
11.6 RULES AND PROCEDURES. The employer may adopt rules and procedures for
in-service withdrawals, which may include the minimum withdrawal amount and
ordering rules for the liquidation of a participant's accounts and investment
funds to make payment of an in-service withdrawal.
The committee may adopt rules relating to its review of specific
hardship withdrawal applications (and may make exceptions to its general rules
in appropriate cases).
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ARTICLE 12
DISTRIBUTIONS
12.1 DISTRIBUTION UPON RETIREMENT OR DISABILITY.
(a) AMOUNT. A participant who retires or who terminates service with
the employer because of disability will receive the full amount in his accounts
even if he is not 100% vested under the schedule in Section 12.2. Payment will
be made at the time provided in Section 12.4.
(b) RETIREMENT DEFINED. Retirement means the participant's termination
of employment on an early retirement date or on or after his normal retirement
date. A participant's NORMAL RETIREMENT DATE is the later of his 60th birthday
or the 5th anniversary of the date he became a plan participant. His EARLY
RETIREMENT DATE is any date before his normal retirement date and on or after
the later of his 55th birthday or the date he completes six years of service.
(c) DISABILITY DEFINED. Disability means the participant's apparently
permanent inability to perform satisfactorily the duties of his position with
the employer because of a physical or mental impairment. The committee will
determine disability. The committee may require a participant to be examined by
a duly qualified physician (or other specialist) selected by the committee, and
may rely upon the physician's (or other specialists's) opinion in determining
the participant's disability.
12.2 DISTRIBUTION UPON TERMINATION OF EMPLOYMENT.
(a) AMOUNT. A participant who terminates employment for any reason
other than retirement, disability or death will receive the vested amount in his
accounts at the time specified in Section 12.4(e).
(b) VESTED INTEREST. A participant will be fully vested in his
employee savings account and rollover account at all times.
A participant who terminates employment for any reason other than
retirement, disability or death will have a vested interest in that percentage
of his basic account, withdrawable account and defined contribution account
specified in the following table based upon his number of years of service as of
the date of his termination of employment:
Years of Service Vested Percentage
---------------- -----------------
Less than 2 0%
2 20%
3 40%
4 60%
5 80%
6 or more 100%
(c) FORFEITURE OF NON-VESTED INTEREST. The non-vested portion of a
terminated participant's accounts, if any, will be forfeited by him on the day
after his termination of employment. If a terminated participant whose accounts
were wholly or partially forfeited returns to employment with the employer (or a
related company) before
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he has six consecutive breaks in service, the amount forfeited will be restored
to his account on the next valuation date. The amount restored will equal the
amount forfeited without change to reflect investment results.
(d) TREATMENT OF FORFEITURES. Any forfeitures occurring during a plan
year under subsection (c) above (or any amounts treated as forfeitures under
Section 3.4(a)) will be treated as an employer profit sharing contribution under
Section 7.2 (up to the amount that the employer had otherwise determined to
contribute under Section 7.2) or as an employer defined contribution under
Section 7.1 (to the extent forfeitures exceed the amount that would otherwise be
contributed under Section 7.2 for such plan year), and will be allocated to
participants' accounts as provided in the plan. Forfeiture amounts described in
the preceding sentence will offset the amount the employer would otherwise
contribute under Section 7.2 or Section 7.1, as the case may be.
12.3 DISTRIBUTION UPON DEATH.
(a) IN GENERAL. If a participant dies while in the employ of the
employer, his accounts will be fully vested regardless of his number of years of
service. Otherwise, his vested interest in his accounts will be determined as of
his termination of employment before his death. His beneficiary will receive the
vested amount (if any) remaining in his accounts.
(b) DESIGNATION OF BENEFICIARY. A participant may designate one or
more beneficiaries to receive any distribution payable under subsection (a) and
may revoke or change such a designation at any time. If the participant names
two or more beneficiaries, distribution to them will be in such proportions as
the participant designates or, if the participant does not so designate, in
equal shares. Any designation of beneficiary will be in writing on such form as
the employer may prescribe and will be effective upon filing with the employer.
Notwithstanding the preceding paragraph, the sole beneficiary of a
married participant will be the participant's spouse unless the spouse consents
in writing to the designation of another person as beneficiary. The spouse's
consent must acknowledge the effect of such consent and be witnessed by a plan
representative or a notary public. If a married participant (with spousal
consent) designated another person as beneficiary and such designation was made
before the first day of the plan year in which his 35th birthday occurs,
effective as of the first day of such plan year the designation will become
invalid insofar as it relates to the participant's defined contribution account
(this means that the participant must file a new designation (with spousal
consent) to continue such person as the beneficiary of his defined contribution
account).
(c) NO DESIGNATION. Any portion of a distribution payable upon the
death of a participant which is not disposed of by a designation of beneficiary
under subsection (b), for any reason whatsoever, will be paid to the
participant's spouse if living at his death, otherwise equally to the
participant's natural and adopted children (and the issue of a deceased child by
right of representation), otherwise to the participant's estate.
(d) PAYMENT UNDER PRIOR DESIGNATION. The employer may direct payment
in accordance with a prior designation of beneficiary (and will be fully
protected in so doing) if such direction (i) is given before a later designation
is received, or (ii) is due to the employer's inability to verify the
authenticity of a later designation. Such a distribution will discharge all
liability therefor under the plan.
12.4 TIME OF DISTRIBUTIONS.
(a) ACTIVE EMPLOYEE. Distribution of a participant's accounts will be made
(or installment payments will begin) no later than the April 1 following the
year in which such participant reaches age 70-1/2 even though the participant
continues in employment thereafter.
(b) RETIRED OR DISABLED EMPLOYEE. Payment to a retired or disabled
participant will be made (or
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installment payments will begin) as soon as practicable after his date of
retirement or disability.
(c) BENEFICIARY. Distribution to a participant's beneficiary will be
made (or installment payments will begin) as soon as practicable after the date
when the employer receives such evidence of the participant's death and the
right of any beneficiary to receive such payment as it deems necessary. However,
if the beneficiary is the participant's spouse, the spouse may in a form filed
with the employer elect to defer distribution until the date the participant
would have reached age 65.
(d) DELAY TO PERMIT FINAL ALLOCATION. Notwithstanding subsections (b)
and (c) above, the employer may delay the date of payment (or the date of the
first installment payment) to a retired or disabled participant or a beneficiary
of a deceased participant until the employer contributions for the participant's
final plan year have been credited to the participant's accounts.
(e) TERMINATED PARTICIPANTS. A participant who terminates employment
for any reason other than retirement, disability or death will receive payment
of his vested accounts (or the first installment payment) as soon as practicable
after his date of termination.
(f) ELECTION TO DEFER. Notwithstanding subsections (b) and (e), if the
participant terminates employment before age 65 and his vested account balances
exceed $3,500, he may elect to defer the payment of his accounts (or the first
installment payment) to such date as he designates. The date may not be later
than his 65th birthday.
An election to defer must be in writing on such form as the employer
prescribes and be filed with the employer. Payment of his vested accounts will
be made in accordance with the participant's election, provided that the
participant may request earlier payment by notifying the employer.
(g) TEFRA GRANDFATHER ELECTION. Notwithstanding any other provision of
the plan, if a participant made a timely election under Section 242(b) of the
Tax Equity and Fiscal Responsibility Act of 1982, payment will be made in
accordance with such election.
12.5 MANNER OF PAYMENT. A participant's accounts will be distributed in
cash (or an annuity contract under Section 12.6(c)).
12.6 FORMS OF PAYMENT. A participant's accounts will be distributed at the
relevant time to the participant (or to his beneficiary in the event of his
death) by one of the following forms of payment, as elected by the participant
or beneficiary:
(a) a single payment;
(b) substantially equal installments over a period of 5, 10 or 15
years, as chosen by the participant, provided that (i) installment payments will
be available only to participants who are age 55 or older when payments begin
(or beneficiaries of such participants) and (ii) any installment payout period
is subject to the distribution rules of Section 12.10, or
(c) purchase of an annuity contract from an insurance company and
distribution of such contract to the participant. Such a contract may be a life
annuity for the participant or a joint and surviving spouse annuity for the
participant and his spouse as described in Section 12.9(a).
Any payment will be based upon the vested amount in the participant's
accounts as of the valuation date
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immediately preceding the date of the payment.
12.7 STANDARD FORM OF PAYMENT. The standard form of payment described in
this section will be paid unless the participant (or beneficiary) elects another
form of payment under Section 12.8.
(a) DEFINED CONTRIBUTION ACCOUNT. The standard form of payment of a
participant's defined contribution account is the purchase of a life annuity
contract with monthly payments for the participant's lifetime starting on the
date payment is to be made under Section 12.4. If a participant is married, the
standard form of payment of the participant's defined contribution account is a
qualified joint and surviving spouse annuity, as described in Section 12.9(a).
The rules in this subsection (a) apply only if the vested amount in the
participant's defined contribution account exceeds $3,500.
(b) OTHER ACCOUNTS. The standard form of payment of a participant's
other accounts is a single payment.
(c) BENEFICIARY. Except as provided in the following sentence, the
standard form of payment to a beneficiary is a single payment. If the
participant's spouse is the beneficiary of his defined contribution account,
such account will be used to purchase a life annuity contract for the spouse
unless the spouse elects otherwise.
12.8 ELECTION OF OPTIONAL FORM OF PAYMENT. A participant may elect an
optional form of payment, may revoke a prior election, or make a new election
after revoking a prior election, by completing and filing the prescribed form
with the employer. Any election, revocation, or failure to make an election will
become effective and irrevocable on the date the participant's benefit payments
begin; the participant may not make an election or change an election after the
date benefit payments begin, except that the employer in its discretion may
permit a later election or change of election if it determines that the
circumstances so warrant. If a participant elects installments or a joint and
surviving spouse annuity contract, the participant must designate the
beneficiary (for installments) and provide such information about the
beneficiary or surviving spouse as the employer may require.
12.9 AUTOMATIC JOINT AND SURVIVING SPOUSE ANNUITY FOR MARRIED PARTICIPANT
WHO DOES NOT ELECT OTHERWISE. The joint and surviving spouse annuity rules of
this section apply to the payment of a married participant's defined
contribution account; such rules also apply to the payment of a married
participant's other accounts if the participant elects an annuity contract form
of payment for such accounts. In addition, the rules of this section apply only
if the amount that would be used to purchase a joint and surviving spouse
annuity contract exceeds $3,500.
(a) IN GENERAL. If a participant has a spouse on the date under
Section 12.4 when he is to receive payment (or the first installment payment),
the vested amount in such accounts will be used to purchase a joint and
surviving spouse annuity contract unless the participant elects otherwise and
the participant's spouse consents to such election. Under the joint and
surviving spouse annuity contract, the participant will receive a monthly
pension payable for his lifetime and ending with the payment immediately before
his death, with monthly payments equal to 50% of the participant's monthly
payment amount continuing thereafter to his surviving spouse (if any) and ending
with the payment immediately before the spouse's death.
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(b) MARRIED PARTICIPANT'S ELECTION OF ANOTHER FORM OF PAYMENT.
(i) ELECTION. A married participant may elect not to receive
payment in the form of a joint and surviving spouse annuity contract by
filing a written election form with the employer during an election period
consisting of the 90 days immediately preceding the participant's annuity
starting date (which is the first day of the first period for which he
receives an amount payable in the form of an annuity or any other form).
During the election period, a participant may revoke an election and may
make a new election after revoking a prior election.
(ii) WRITTEN NOTIFICATION OF ELECTION. The employer will furnish
each married participant with a notification of the right to elect another
form of payment, by personal delivery or mailing so as to reach him a
reasonable time before the start of his election period. The notification
will be written in non-technical language and will include an explanation
of the terms and conditions of the automatic joint and surviving spouse
annuity form, the participant's right to make and the effect of an election
not to receive benefits in such form, the rights of the participant's
spouse, and the participant's right to revoke and the effect of a
revocation of a previous election not to receive benefits in such form.
(iii) SPOUSAL CONSENT REQUIRED. A participant's election under
subsection (i) above will be valid only if the participant's spouse
consents in writing to such election. The spouse's consent must acknowledge
the effect of such consent and must be witnessed by a representative of the
plan or a notary public.
The foregoing spousal consent requirement will apply to a
participant unless he establishes that he is not married or that his spouse
cannot be located. In making determinations of marital status, the employer
may rely upon the participant's representation as to his marital status and
the identity of his spouse.
(iv) COMPLIANCE WITH REGULATIONS. Notifications, elections and
spousal consents under this section, and any of the committee's procedures
relating thereto, will comply with Code Sections 401(a)(11) and 417 and
regulations and rulings thereunder.
12.10 DISTRIBUTION RULES FOR INSTALLMENT PAYMENTS. The following rules
apply if a participant or beneficiary elects installment payments. If a
surviving spouse elects installments, the surviving spouse will be treated as
the participant for purposes of applying the rules below.
(a) PAYMENTS TO PARTICIPANT OR TO PARTICIPANT AND SURVIVING SPOUSE.
Where installment payments commence during the participant's lifetime, and the
participant has no designated beneficiary or his spouse is his designated
beneficiary, this subsection will apply. The amount to be distributed each year
will be at least equal to the balance in the participant's account as of the
preceding year's payment anniversary date multiplied by a fraction. The
numerator of the fraction is one and the denominator is the life expectancy of
the participant (or joint life expectancies of the participant and his spouse)
determined as of the preceding anniversary date.
(b) PAYMENTS TO PARTICIPANT AND NON-SPOUSE BENEFICIARY. Where
installment payments commence during the participant's lifetime, and the
participant's designated beneficiary is other than his spouse, this subsection
will apply. The amount to be distributed each year will be at least equal to the
balance in the participant's accounts as of the preceding year's payment
anniversary date multiplied by a fraction. The numerator of the fraction is one;
the denominator is the smaller of the joint life expectancy of the participant
and his designated beneficiary or the "applicable divisor" under Section
1.401(a)(9)-2 of the proposed regulations (or any replacing regulations),
computed as of the date of the first payment and reduced by one for each
succeeding year.
(c) PAYMENTS TO NON-SPOUSE BENEFICIARY. Where installment payments
commence after the
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participant's death (other than in cases where the participant's surviving
spouse is the beneficiary), this subsection will apply. The amount to be
distributed each year will be at least equal to the balance in the accounts as
of the preceding year's payment anniversary date multiplied by a fraction. The
numerator of the fraction is one and the denominator is either the life
expectancy of the beneficiary determined at the first payment date (where the
beneficiary was designated by the participant) or five (in all other cases),
with the denominator decreased by one for each subsequent payment.
(d) REMAINING BALANCE UPON THE DEATH OF A PARTICIPANT. If a
participant who elects installment payments dies with a balance remaining in his
accounts, the remaining balance will be distributed to his beneficiary at least
as rapidly as under the method of distribution being used as of the
participant's death.
12.11 REHIRE BEFORE DISTRIBUTION. If a participant is rehired before
distribution of his accounts has started, such distribution will be deferred
until his subsequent termination of employment. If a partial distribution has
been made, the employer in its discretion will determine whether distribution is
to be continued, or is to be suspended until his subsequent termination of
employment.
12.12 DIRECT ROLLOVERS.
(a) IN GENERAL. 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 elect, at the time and in the manner prescribed by the committee, to have
any portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover.
(b) DEFINITIONS. The following definitions apply for purposes of this
section.
(i) ELIGIBLE ROLLOVER DISTRIBUTION is any distribution of all or
any portion of the balance to the credit of the distributee, except
that an eligible rollover distribution does not include: any
distribution that is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or
life expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under Code
Section 401(a)(9); and the portion of any distribution that is not
includible in gross income (determined without regard to the exclusion
for net unrealized appreciation with respect to employer securities).
In addition, an eligible rollover distribution will not include any
distribution that is below any threshold amount established by
applicable regulations (including any threshold amount for direct
rollovers when only a portion of a distributee's distribution is being
rolled over).
(ii) An ELIGIBLE RETIREMENT PLAN is 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 will accept the distributee's eligible rollover
distribution. However, in the case of an eligible rollover
distribution to the surviving spouse, an eligible retirement plan is
an individual retirement account or individual retirement annuity.
(iii) A DISTRIBUTEE includes an employee or former employee. In
addition, the employee's or former employee's surviving spouse and the
employee's or former employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as defined
in Code Section 414(p), are distributees with regard to the interest
of the spouse or former spouse.
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(iv) A DIRECT ROLLOVER is a payment by this plan to the eligible
retirement plan specified by the distributee, with such payment being
made in any manner permitted by applicable regulations.
ARTICLE 13
AMENDMENT, MERGER AND TERMINATION OF PLAN
13.1 AMENDMENT OF PLAN. At any time and from time to time, the employer may
amend or modify any or all of the provisions of the plan without the consent of
any person, provided that no amendment will reduce any participant's
nonforfeitable interest in his accounts as of the date such amendment is adopted
(or its effective date, if later), and provided further that no amendment will
permit any part of the trust fund to revert to the employer or be used for or
diverted to purposes other than for the exclusive benefit of participants or
their beneficiaries.
13.2 MERGER OF PLANS. A merger or consolidation with, or transfer of assets
or liabilities to, any other plan will be permitted only if the benefit each
participant would receive if such plan were terminated immediately after the
merger, consolidation or transfer is not less than the benefit he would have
received if this plan had terminated immediately before the merger,
consolidation or transfer.
13.3 TERMINATION. The employer has established the plan with the bona fide
expectation and intention that it will be able to continue the plan and
contributions thereto indefinitely, but the employer reserves the right to
discontinue contributions to the plan indefinitely or temporarily, or it may
terminate the plan, and it will have no liability to any participant,
beneficiary or other person as a result of such discontinuance or termination by
the employer.
The employer's failure to make contributions in any year or years will not
operate to terminate the plan in the absence of formal action by the employer.
The employer in its discretion may terminate the money purchase plan or the
profit sharing plan and continue the other.
13.4 EFFECT OF TERMINATION. Upon complete discontinuance of contributions
or termination or partial termination of the plan, the accounts of affected
participants will be nonforfeitable. After such termination, no employee will
become a participant, and no further contributions or employee savings will be
made to the plan on behalf of participants.
After termination of the plan, the trustee will continue to hold the assets
of the trust fund attributable to the accounts of participants for distribution
as directed by the employer. The employer will determine whether to disburse
such assets as immediate benefit payments, to retain and disburse them in the
future, to purchase immediate or deferred annuity contracts, or to follow any
other procedure which it deems advisable.
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ARTICLE 14
NAMED FIDUCIARIES
14.1 IDENTITY OF NAMED FIDUCIARIES. The employer, the trustee and the
committee will be the named fiduciaries under the plan and will control and
manage the plan and its assets to the extent and in the manner indicated in this
article and in the trust agreement. Any responsibility assigned to a named
fiduciary will not be deemed to be a duty of a "fiduciary" (as defined in ERISA)
solely because of such assignment.
14.2 RESPONSIBILITIES AND AUTHORITY OF COMMITTEE. The committee will have
such responsibilities and authority for the operation and administration of the
plan as are specifically assigned to it hereunder. The responsibilities and
authority of the committee are set forth in detail in various articles of this
plan and primarily in Article 0.
14.3 RESPONSIBILITIES AND AUTHORITY OF TRUSTEE. The trustee will manage and
control the assets of the plan except to the extent that such responsibilities
(a) are specifically assigned hereunder or under the trust agreement to the
employer, (b) are delegated to one or more investment managers by the employer,
or (c), if applicable, are performed by a participant with respect to the
selection of a separate investment fund or funds for the investment of his
accounts in accordance with Section 9.2 or with respect to the obtaining of a
loan under Article 10. The responsibilities and authority of the trustee are set
forth in detail primarily in the trust agreement.
14.4 RESPONSIBILITIES OF THE EMPLOYER. The employer will have the following
responsibilities and authority with respect to the control and management of the
plan and its assets:
(a) to amend or terminate the plan;
(b) to merge or consolidate the plan with, or transfer all or part of
the assets or liabilities to, any other plan;
(c) to appoint, remove and replace the trustee and the committee
members and to monitor their performances;
(d) to appoint, remove and replace one or more investment managers, or
to refrain from such appointments, and to monitor their performances; and to
determine the separate investment funds that will be available from time to time
under Section 9.1;
(e) to perform such additional duties as are required by the plan, the
trust agreement or by law.
(f) as ERISA plan administrator, to prepare, file, submit, distribute
or make available any plan descriptions, reports, statements, forms or other
information to any government agency, employee, former employee, or beneficiary
as may be required by law or by the plan; and
(g) to keep or cause to be kept all data, records, books of account
and instruments pertaining to plan administration.
The foregoing responsibilities and authority of the employer are set forth
in further detail in various articles of the plan and in the trust agreement.
Any responsibilities that are not specifically assigned hereunder to the
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committee, the trustee, an investment manager (if any) or the participants will
be carried out by the employer.
14.5 RESPONSIBILITIES NOT SHARED. Except as otherwise specified herein or
required by law, each named fiduciary will have only those responsibilities that
are specifically assigned to it hereunder, and no named fiduciary will incur
liability because of improper performance or nonperformance of responsibilities
assigned to another named fiduciary.
14.6 PROCEDURE FOR ALLOCATION AND DELEGATION OF RESPONSIBILITIES. The
members of the committee or the members of the employer's Board of Directors or
a committee of such Board may allocate their responsibilities among themselves
in any reasonable manner and may delegate any of their responsibilities to any
other person or persons by so specifying in a written instrument. No committee
member or director will be liable for the improper discharge or nonperformance
of any responsibility so allocated or delegated to another person, except to the
extent liability is imposed by law.
14.7 DUAL FIDUCIARY CAPACITY PERMITTED. Any person or group of persons may
serve in more than one fiduciary capacity.
14.8 ADVICE. A named fiduciary may employ or retain such attorneys,
accountants, investment advisors, consultants, specialists and other persons or
firms as it deems necessary or desirable to advise or assist in the performance
of duties. Unless otherwise provided by law, the fiduciary will be fully
protected with respect to any action taken or omitted by it in reliance upon
advice rendered by any such person or firm within his or its field of expertise.
14.9 ACTIONS BY THE EMPLOYER. Wherever the plan specifies that the employer
is required or permitted to take any action, such action will be taken by the
employer's board of directors or by a duly authorized committee thereof, or by
one or more directors, officers or employees of the employer duly authorized to
do so by its board of directors.
14.10 INDEMNIFICATION. To the extent permitted by law and not prohibited by
its charter and by-laws, the employer will indemnify and hold harmless every
person serving as a fiduciary (whether a named fiduciary or otherwise), and the
executor or administrator of such a person if he is deceased, from and against
all claims, loss, damages, liability, and reasonable costs and expenses,
incurred in carrying out his fiduciary responsibilities, unless due to the gross
negligence, bad faith or willful misconduct of such person; provided that this
section will not apply to any claim, loss, damages, liability, or costs and
expenses which are covered by a liability insurance policy maintained by the
employer, by the plan, by the committee, or by an individual fiduciary. The
preceding sentence will not apply to a corporate trustee, an insurance company,
an investment manager as defined in ERISA, or a professional or commercial
advisor or service provider (or to an employee of any of the foregoing), unless
the employer otherwise agrees in writing.
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ARTICLE 15
THE PLAN COMMITTEE
15.1 APPOINTMENT. The employer will appoint a committee whose members may,
but need not, be plan participants or employees or officers of the employer. The
number of persons serving on the committee at any time will be determined by the
employer, and may be changed from time to time by it. The employer may remove
any committee member at any time, with or without cause, by filing written
notice of his removal with the committee and the trustee. A committee member may
resign at any time by filing his written resignation with the employer, the
committee and the trustee. A vacancy, however arising, may be filled by the
employer.
If an employee serving as a committee member terminates employment as an
employee for any reason, such termination will be deemed to constitute such
employee's resignation as a committee member.
15.2 NOTICE TO TRUSTEE. The employer will notify the trustee in writing of
each committee member's appointment, and the trustee may assume such appointment
continues in effect until written notice to the contrary is given by the
employer or a resigning committee member.
15.3 ADMINISTRATION OF PLAN. The committee will have all powers and
authority necessary or appropriate to carry out its responsibilities for the
operation and administration of the plan. It will as necessary or appropriate to
carry out such responsibilities have discretionary authority to interpret and
apply all plan provisions and may correct any defect, supply any omission or
reconcile any inconsistency or ambiguity in such manner as it in its discretion
deems advisable. It will make all final determinations concerning eligibility,
benefits and rights hereunder, and all other matters concerning plan
administration and interpretation that are the committee's responsibility. All
determinations and actions of the committee will be conclusive and binding upon
all persons, except as otherwise provided herein or by law, and except that the
committee may revoke or modify a determination or action previously made in
error. Any determination, action or inaction by the committee (or by any other
named fiduciary hereunder) will be subject to review (by a court or otherwise)
only for an abuse of discretion. The committee will exercise all powers and
authority given to it in a nondiscriminatory manner, and will apply uniform
administrative rules of general application to insure that persons in similar
circumstances are treated alike.
15.4 IMPOSSIBLE OR DIFFICULT PERFORMANCE. If performance of any act
required hereunder is impossible or difficult, the committee or the employer in
its discretion may perform or direct the performance of any other act which it
determines will carry out the plan's purposes. Such performance will discharge
all liability with respect thereto.
15.5 COMPENSATION AND EXPENSES. The committee, and each committee member,
will serve without compensation unless the employer determines otherwise;
provided that an employee of the employer will not be compensated for his
services as a committee member.
All reasonable expenses of administering the plan will be paid out of the
trust fund unless paid by the employer. Such expenses include the compensation
of all persons employed or retained by the committee or the employer, premiums
for bonds and insurance protecting the plan or trust fund and required by law or
deemed advisable by the employer, and all other costs of plan administration.
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15.6 COMMITTEE DECISIONS, RULES AND REGULATIONS. Any action or decision
concurred in by a majority of the committee members, either at a meeting or in
writing without a meeting, will constitute an action or decision of the
committee. No committee member may vote on any matter which relates exclusively
to himself. The committee may adopt and amend such rules for the conduct of its
business and the administration of the plan as it deems advisable.
15.7 SECRETARY OF THE COMMITTEE. The committee at its option may appoint
any committee member or other person to serve as secretary, and may remove him
at any time. The committee will notify the trustee in writing of such person's
appointment, and the trustee may assume his authority to act as secretary
continues until written notice to the contrary is given by the committee.
The secretary, or a majority of the committee members then in office, will
have the authority to execute all instruments or memoranda necessary or
appropriate to carry out the actions and decisions of the whole committee; and
any person may rely upon any instrument or memorandum so executed as evidence of
the committee action or decision indicated thereby.
15.8 CLAIMS REVIEW PROCEDURE. Any request for benefits (the CLAIM) by a
participant or his beneficiary (the CLAIMANT) will be filed in writing. Within a
reasonable period after receipt of a claim, the employer will provide written
notice to any claimant whose claim has been wholly or partly denied, including:
(a) the reasons for the denial; (b) the plan provisions on which the denial is
based; (c) any additional material or information necessary to perfect the claim
and the reasons it is necessary; and (d) the plan's claims review procedure. A
claimant will be given a full and fair review by the employer of the denial of
his claim if he requests a review in writing within 60 days after notification
of the denial. The claimant may review pertinent documents and may submit issues
and comments orally, in writing, or both. The employer will render its decision
on review promptly and in writing and will include specific reasons for the
decision and references to the plan provisions on which the decision is based.
ARTICLE 16
MISCELLANEOUS
16.1 PAYMENT TO MINORS AND INCOMPETENTS. If the committee deems any person
incapable of giving a binding receipt for benefit payments because of minority,
illness, infirmity or other incapacity, it may direct payment directly for the
benefit of such person, or to any person selected by the committee to disburse
it. Such payment, to the extent thereof, will discharge all liability for such
payment under the plan.
16.2 NONALIENATION OF BENEFITS. No benefit, right or interest hereunder of
any person will be subject to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance or charge, or to seizure, attachment or other
legal, equitable or other process, or be liable for, or subject to, the debts,
liabilities or other obligations of such person.
Notwithstanding the preceding paragraph, the plan may carry out the
requirements of a qualified domestic relations order of a court (or other valid
court order). The employer will establish procedures that comply with Code
Section 414(p) for processing, verifying and carrying out such orders. Payments
to an alternate payee under a qualified domestic relations order may be made at
the time specified in such order notwithstanding the fact that the participant
is still an employee of the employer or would otherwise not be eligible to
receive a payment himself from the plan at such time.
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16.3 CURRENT ADDRESS OF PAYEE. Any person entitled to benefits is
responsible for keeping the employer informed of his current address at all
times. The committee, trustee and employer have no obligation to locate such
person, and will be fully protected if all payments and communications are
mailed to his last known address, or are withheld pending receipt of proof of
his current address and proof that he is alive.
16.4 DISPUTES OVER ENTITLEMENT TO BENEFITS. If two or more persons claim
entitlement to payment of the same benefit hereunder, the committee in its
discretion may withhold payment of such benefit until the dispute has been
determined by a court of competent jurisdiction or has been settled by the
persons concerned.
16.5 PAYMENT OF BENEFITS. Notwithstanding any other provision of this plan
(except Section 12.4(a)), unless a participant elects otherwise, his benefit
payments under the plan will begin not later than 60 days after the close of the
plan year in which the latest of the following dates occurs: (a) the date he
terminates service with the employer; (b) his 65th birthday; and (c) the 10th
anniversary of the year in which his participation began.
16.6 MAXIMUM ADDITIONS.
(a) The annual additions to a participant's accounts for any plan year
may not exceed the lesser of (i) $30,000, or if greater one-quarter of the
defined benefit plan dollar limitation for such year under Code Section
415(b)(1)(A), or (ii) 25% of his total compensation for such year. For purposes
of this section, TOTAL COMPENSATION means a participant's total non-deferred
compensation from the employer for a plan year, as defined in Code Section 415
and regulations thereunder.
(b) If the annual additions to a participant's account would exceed
the limitations of subsection (a) the employee savings made on his behalf for
such year which would be credited to his account but for the limitations of
subsection (a) will be returned to him (with earnings as provided in the
regulations under Code Section 415), but only to the extent necessary to comply
with subsection (a). If the annual additions would still exceed the limitations
of subsection (a), the employer integrated (Step One) and the next basic (Step
Two) profit sharing contribution and finally the employer defined contribution
which would be allocated to his accounts but for the limitations of subsection
(a) will be reduced but only to the extent necessary to comply with subsection
(a).
(c) For purposes of this section, ANNUAL ADDITIONS to a participant's
accounts for any plan year means the sum of all amounts credited to his accounts
for such year (other than any rollovers to this plan under Section 6.1).
16.7 TOP HEAVY PLAN PROVISIONS.
(a) APPLICABILITY OF THIS SECTION. This section is included in the
plan to meet the requirements of Code Section 416, and will be operative only
if, when and to the extent that Code Section 416 applies to the plan. At such
time as the requirements of Code Section 416 apply to the plan because the plan
is top heavy as defined in subsection (b)(i) below, this Section will apply and
will govern over any contrary provisions of the plan.
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(b) DEFINITIONS.
(i) The plan will be TOP HEAVY for a plan year if, as of the
determination date, the sum of the aggregate amount in the accounts of
participants who are key employees exceeds 60% of a similar amount
determined for all participants in this plan.
Notwithstanding the preceding paragraph, if the plan is included
within a required or permissive aggregation group, the plan will be top
heavy for a plan year if, as of the determination date, the sum of (A) the
aggregate amount in the accounts of participants who are key employees
(including all defined contribution plans within such group), and (B) the
aggregate present value of cumulative accrued benefits of participants who
are key employees (including all defined benefit plans within such group)
exceeds 60% of such amount determined for all participants in all such
plans.
In determining the amounts in participants' accounts and present
values of accrued benefits under the preceding two paragraphs, (A)
distributions made during the 5 years ending on the determination date will
be taken into account, (B) rollover contributions after December 31, 1983,
will be taken into account only to the extent provided in regulations under
Code Section 416(g)(4)(A), (C) account balances and accrued benefit values
of a person who was but no longer is a key employee will be disregarded,
and (D) account balances and accrued benefit values of a person who has not
received any compensation from the employer at any time during the 5 years
ending on the determination date will be disregarded.
(ii) The DETERMINATION DATE for purposes of determining whether
the plan is top heavy under subsection (i) for a particular plan year is
the last day of the preceding plan year.
(iii) A KEY EMPLOYEE is any employee or former employee (including
a beneficiary of such person) who at any time during the plan year or any
of the 4 preceding plan years was:
(A) an officer of the employer having annual compensation
greater than 50% of the amount in effect under Code Section
415(b)(1)(A) for such plan year (but no more than 50 employees will be
taken into account under this subsection (A) as key employees);
(B) one of the 10 employees owning (or considered as owning
within the meaning of Code Section 318) the largest interests in the
employer, but only if such employee's compensation for such year
exceeds the amount specified in Code Section 415(c)(1)(A). For
purposes of the preceding sentence, if 2 participants have the same
interest in the employer, the participant having greater annual
compensation from the employer will be treated as having a larger
interest;
(C) a person owning (or considered as owning within the
meaning of Code Section 318) more than 5% of the stock of the
employer; or
(D) a person who has annual compensation from the employer
of more than $150,000 and who would be described in subsection (C)
above if 1% were substituted for 5%.
For purposes of applying Code Section 318 to the provisions of
this subsection (iii), subparagraph (C) of Code Section 318(a)(2) will be
applied by substituting "5%" for "50%". In addition, the rules of Code
Section 414(b), (c) and (m) will not apply for purposes of determining
ownership under subsections (C) and (D) above.
(iv) A NON-KEY EMPLOYEE is any employee or former employee
(including a beneficiary of such person) who is not a key employee under
subsection (iii) above.
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(v) A REQUIRED AGGREGATION GROUP includes all qualified plans of
the employer in which a key employee participates and each other qualified
plan of the employer that enables any of such plans to meet the
requirements of Section 401(a)(4) or Section 410 of the Code. A PERMISSIVE
AGGREGATION GROUP includes (in addition to plans in a required aggregation
group) any plan which the employer designates for inclusion provided that
inclusion of such plan does not cause the group to fail the requirements of
Section 401(a)(4) or Section 410 of the Code.
(c) MINIMUM CONTRIBUTION. For any plan year in which the plan is
top-heavy, the employer will make a minimum contribution on behalf of each
non-key employee who has satisfied the requirements of Section 4.2 (regardless
of whether such non-key employee completed 1,000 hours of service during such
plan year) equal to 3% of his total compensation (as defined in Section
16.6(a)). Such minimum contribution will be reduced as permitted under
regulations under Code Section 416 to reflect contributions on behalf of such
non-key employee under this or any other plan maintained by the employer.
16.8 SEPARATE ACCOUNTS.
(a) The term REMAINING BALANCE as used in subsection (b) below means a
participant's balance in any of his accounts remaining after a portion or all of
his vested interest therein is withdrawn or distributed to him before forfeiture
of his non-vested interest under Section 12.2, or the balance in such an account
after restoration of the amount previously forfeited as provided in Section
12.2(c).
(b) The remaining balance of a participant will be credited to a
separate account within the affected account of the participant, or accounting
records will be maintained in a manner which has the same effect as if a
separate account were established. Notwithstanding Section 12.2, at any
subsequent time the participant's vested interest in any such separate account
will be expressed by the formula:
P(A + D) - D
where P is the participant's vested percentage at such time determined without
regard to this Section 16.8; A is the amount in such separate account at such
time; and D is the amount of the withdrawal or distribution.
16.9 VOTING AND TENDERING RIGHTS OF PRIMARK COMMON STOCK.
(a) APPLICABILITY OF THIS SECTION. This section will apply at any time
that there is an investment fund consisting of publicly traded stock issued by
the employer (or its parent or other affiliate). Such a fund is referred to in
this section as the "Primark common stock fund."
(b) VOTING. Each participant or former participant will have the right
confidentially to vote the shares of Primark common stock representing the
interest of his accounts invested in the Primark common stock fund at any annual
or special meeting of stockholders of Primark Corporation (or any other occasion
for the exercise of voting rights on such common stock).
The trustee will deliver (or cause to be delivered) to each
participant or former participant (or in the event of his death to his
beneficiary) all notices, financial statements, proxies and proxy soliciting
material relating to such shares of Primark common stock. The trustee will
notify each participant or former participant at his last known address of each
occasion for the exercise of voting rights within a reasonable time before such
rights are to be exercised, which notification will include all the information
that is distributed to shareholders regarding the exercise of such rights and a
form for the participant or former participant to use to give confidential
voting instructions to the Trustee. Each such participant or former participant
(or beneficiary) may direct the trustee as to
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the exercise of all voting rights relating to the Primark common stock that he
has the right to vote under this section; for this purpose, "voting rights" will
include any applicable appraisal or dissenters' rights under state law, which
the trustee will exercise or not in accordance with the participant's timely
instructions and at the participant's expense. The participant's voting
instructions must be received by such deadline as the trustee specifies; if the
participant's instructions are not received by the deadline, the shares that the
participant has the right to vote will be treated as if the participant had
submitted no voting instructions.
(c) TENDERING. In the event of a tender or exchange offer for, or
other offer to purchase, Primark Corporation common stock (collectively referred
to as a "tender offer" in this subsection), each participant or former
participant (or in the event of his death his beneficiary) will have the right
confidentially either to tender or not to tender the shares of Primark common
stock representing the interest of his accounts invested in the Primark stock
fund.
The trustee will deliver to each participant or former participant
(or in the event of his death his beneficiary) all materials relating to such
tender offer as soon as possible after receipt by the trustee, together with a
form for the participant or former participant (or beneficiary) to use to give
confidential instructions to the trustee on how to respond to such tender offer.
The participant's tendering instructions must be received by the trustee by such
deadline as the trustee specifies. If the participant's tendering instructions
are not received by the deadline, the participant will be deemed to have
instructed the trustee not to tender.
(d) UNINSTRUCTED ACCOUNT SHARES. The trustee will vote all shares of
Primark common stock held in the trust fund for which voting instructions from
the participant (or former participant or beneficiary) are not timely received
("uninstructed shares") in accordance with the Trust Agreement.
(e) NAMED FIDUCIARIES. Each participant (or former participant or
beneficiary, if applicable) is hereby designated a "named fiduciary" within the
meaning of ERISA Section 402(a) with respect to (i) voting the shares of Primark
common stock over which he has voting control under subsection (a) above, and
(ii) tendering or not tendering the shares of Primark common stock over which he
has control under subsection (b) above.
In voting or tendering the shares of Primark common stock under
subsections (a) and (b) above, the trustee is directed and agrees to follow the
instructions of the participants (and former participants and beneficiaries) as
named fiduciaries in accordance with ERISA Section 403(a)(l).
(f) CONFIDENTIALITY. Each participant's (or former participant's or
beneficiary's) voting or tendering instructions under this section will be
completely confidential. The trustee will hold such instructions in strict
confidence and will not divulge or release such instructions to any person,
including particularly any employer, officer, employee or director of the
employer, or any person directly or indirectly controlling, controlled by or
under common control with the employer; provided, however, that to the extent
deemed necessary by the trustee for the operation of the plan and the
implementation of participants' voting or tendering rights, the trustee may
transmit such instructions to a recordkeeper, auditor, tallier or similar
service provider who is not a person specified in the preceding clause of this
sentence and who agrees not to divulge or release such instructions to any such
person; and provided further that the trustee may comply with any order of a
court of competent jurisdiction requiring disclosure of participants' voting or
tendering instructions.
16.10 RULES OF CONSTRUCTION.
(a) A word or phrase defined or explained in any article has the same
meaning throughout the plan unless the context requires otherwise.
(b) Where the context so requires, the masculine includes the
feminine, the singular includes the
<PAGE> 39
plural, and the plural includes the singular.
(c) Unless the context indicates otherwise, the words "herein",
"hereof", "hereunder", and words of similar import refer to the plan as a whole
and not only to the section in which they appear.
16.11 TEXT CONTROLS. Headings and titles are for convenience only, and the
text will control in all matters.
16.12 APPLICABLE STATE LAW. To the extent that state law applies, the
provisions of the plan will be construed, enforced and administered according to
the laws of the Commonwealth of Massachusetts.
Executed on June 29, 1994.
The Analytic Sciences Corporation
By:
-----------------------------------
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Schedule A
----------
TASC PROFIT SHARING AND STOCK OWNERSHIP PLAN
--------------------------------------------
Schedule Of Plan Amendments
---------------------------
1. The Plan (originally named the TASC Profit Sharing Plan) was established by
an Agreement dated April 8, 1968.
2. The Plan was amended by a First Amendment dated June 25, 1968.
3. The Plan was amended by a Second Amendment dated May 23, 1972.
4. The Plan was amended by a Third Amendment dated November 30, 1973.
5. The Plan was amended by a Fourth Amendment dated June 17, 1974.
6. The Plan was amended by a Fifth Amendment dated April 7, 1975.
7. The Plan was amended by a Sixth Amendment dated August 25, 1975.
8. The Plan was amended by a Seventh Amendment and Codification dated June 12,
1978, effective June 1, 1976 (ERISA amendment).
9. The Plan was amended and renamed the TASC Profit Sharing and Stock
Ownership Trust by an Eighth Amendment dated December 13, 1978.
10. The Plan was amended by a Ninth Amendment dated July 9, 1979.
11. The Plan was amended by a Tenth Amendment and Codification dated August 18,
1980, effective June 1, 1979.
12. The Plan was amended by an Eleventh Amendment dated July 30, 1981.
13. The Plan was amended by a Twelfth Amendment dated October 5, 1982.
14. The Plan was amended by a Thirteenth Amendment dated October 5, 1982.
15. The Plan was amended by a Fourteenth Amendment and Codification effective
January 1, 1983.
16. The Plan was amended by a Fifteenth Amendment dated as of February 18, 1986
(TEFRA, DEFRA and REA amendment).
17. The Plan was amended and restated by the Sixteenth Amendment dated November
5, 1987, effective as of June 1, 1987 (Tax Reform Act of 1986 amendment).
33
<PAGE> 41
18. The Plan was amended by the Seventeenth Amendment effective as of June 1,
1987 (changes requested by IRS reviewer).
19. The Plan was amended by the Eighteenth Amendment effective in part as of
April 1, 1989 (standards for hardship loans and withdrawals), and in part
as of June 1, 1989 (plan integration formula).
20. The Plan was amended by the Nineteenth Amendment with various effective
dates as specified in such amendment.
21. The Plan was amended by the Twentieth Amendment effective as of December 1,
1991 (clarification of payments to terminating participants).
22. The plan was amended by the Twenty-First Amendment effective in part as of
March 1, 1992 (clarification of allocation of fiduciary and administrative
responsibilities) and in part as of June 1, 1992 (changes to definition of
applicable compensation and one year of service for eligibility for
employer contributions).
23. The Plan was amended by the Twenty-Second Amendment effective in part as of
June 1, 1988 (change to definition of normal retirement date) and in part
as of June 1, 1992 (change to the integration level in the profit sharing
contribution allocation formula).
24. The plan was amended by the Twenty-Third Amendment effective in part as of
June 1, 1992 (miscellaneous changes), in part as of January 1, 1993 (direct
rollovers), in part as of June 1, 1993 (change in plan year, changes in
amounts that may be withdrawn in the event of hardship, and miscellaneous
other changes), in part as of January 1, 1994 (change to maximum amount of
applicable compensation taken into account under the plan and miscellaneous
other changes), and in part as of February 1, 1994 (changes in loan
repayment requirements).
25. The plan was amended and restated by the Twenty-Fourth Amendment effective
as of January 1, 1994, to make miscellaneous clarifying and other
non-substantive changes.
26. The plan was amended by the Twenty-Fifth Amendment effective as of August
1, 1994 (in-service withdrawals on or after normal retirement age)."
27. The Plan was amended by the Twenty-Sixth Amendment, effective as of the
dates specified therein, to permit loans for any reason, to provide for
participant investment control over the Primark common stock fund, and to
make related administrative and clarifying changes.
34
<PAGE> 1
EXHIBIT 5.1
December 9, 1996
Primark Corporation
1000 Winter Street
Suite 4300N
Waltham, Massachusetts 02154
Ladies and Gentlemen:
Reference is made to the Registration Statement on Form S-8 ("Registration
Statement") of Primark Corporation (the "Corporation") related to the
registration of 1,414,276 shares of the Corporation's common stock, without par
value ("Common Stock"), which are to be offered or sold pursuant to the TASC
Profit Sharing and Stock Ownership Plan (the "Plan").
I have been requested to furnish an opinion to be included as Exhibit 5.1
to the Registration Statement. In conjunction with the furnishing of this
opinion, I have examined such corporate documents and have made such
investigation of matters of fact and law as I have deemed necessary to render
this opinion.
Based upon such examination and investigation, and upon the assumption that
there will be no material changes in the documents examined and matters
investigated, I am of the opinion that the 1,414,276 shares of Common Stock
referred to above have been duly authorized by the Corporation and that, when
issued in accordance with the terms of the Plan, will be legally issued, fully
paid and nonassessable.
I consent to the filing of this opinion as Exhibit 5.1 to the Registration
Statement.
Very truly yours,
/s/ MICHAEL R. KARGULA
-----------------------------
Michael R. Kargula, Esq.
Senior Vice President,
General Counsel and Secretary
<PAGE> 1
EXHIBIT 5.2
[MINTZ LEVIN LETTERHEAD]
December 6, 1996
Primark Corporation
1000 Winter Street
Suite 4300N
Waltham, MA 02154
Attention: Michael R. Kargula, Esquire
Dear Sirs:
This opinion letter is provided to you in connection with the filing with
the Securities and Exchange Commission of a Registration Statement on Form S-8
with respect to 1,414,276 shares of common stock of Primark Corporation,
1,164,276 of which are currently held in the TASC Profit Sharing and Stock
Ownership Plan (the "Plan").
We have served as special counsel to TASC, Inc. ("TASC"), a wholly-owned
subsidiary of Primark Corporation, with respect to matters concerning the Plan,
and, in that connection, have assisted TASC in the preparation of amendments to
the Plan, most recently the Twenty-Fourth Amendment (restating the Plan) and the
subsequent Twenty-Fifth Amendment, and the filing with the Internal Revenue
Service of an application for a favorable determination letter with respect to
the tax qualification under Internal Revenue Code Section 401(a) of the Plan as
restated by the Twenty-Fourth Amendment and the exemption from income taxation
of its related trust under Internal Revenue Code Section 501(a). TASC has
received a favorable determination letter from the Internal Revenue Service
dated December 30, 1994, for the Plan as restated by the Twenty-Fourth
Amendment. We also have assisted TASC with the preparation of the Twenty-Sixth
Amendment to the Plan and are familiar with such amendment. In addition, we have
been informed by officials of TASC that it is TASC's intention to file the
Twenty-Fifth and Twenty-Sixth Amendments to the Plan with the Internal Revenue
Service with an application for a determination that such amendments do not
adversely affect the tax qualification of the Plan or the tax exemption of its
related trust, and that TASC intends to take such steps, including the adoption
of revisions or amendments to the Plan provisions if requested by the Internal
Revenue Service, in order to obtain such a determination.
Based upon the foregoing, we are of the opinion that the Plan is qualified
under Internal Revenue Code Section 401(a) and that its related trust is exempt
from income taxation under Internal Revenue Code Section 501(a).
We hereby consent to the filing of this opinion as an exhibit to the
above-mentioned Registration Statement. In giving such consent, we do not
thereby admit that this firm is in the category of persons whose consent is
required under Section 7 of the Securities Act of 1933, as amended, or the rules
and regulations of the Securities and Exchange Commission promulgated
thereunder.
Very truly yours,
/S/ MINTZ, LEVIN, COHN, FERRIS,
GLOVSKY AND POPEO, P.C.
....................................
MINTZ, LEVIN, COHN, FERRIS, GLOVSKY
AND POPEO, P.C.
ML/tmm
cc: Kenneth M. Stone
William E. Morrill
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement
of Primark Corporation of Form S-8 of our report dated February 8, 1996,
incorporated by reference in the Annual Report on Form 10-K of Primark
Corporation for the year ended December 31, 1995. We also consent to the
reference to us under the heading "Item 5. Interests of Named Experts and
Counsel" in such Registration Statement.
/s/ DELOITTE & TOUCHE LLP
Boston, Massachusetts
December 9, 1996
<PAGE> 1
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement
of Primark Corporation on Form S-8 of our reports dated February 3, 1995 and
January 29, 1993, except for Note 12, which date is September 6, 1993, appearing
in Amendment No. 2 on Form 8-K/A to the Current Report on Form 8-K dated July 3,
1995 of Primark Corporation.
/s/ LESLIE SUFRIN AND COMPANY, P.C.
Leslie Sufrin and Company, P.C.
New York, New York
December 9, 1996
