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EXHIBIT 10.2(l)
BELO SAVINGS PLAN
As Amended and Restated Effective July 1, 2000
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BELO SAVINGS PLAN
A. H. Belo Corporation, a Delaware corporation, amends and completely
restates the A. H. Belo Corporation Employee Savings and Investment Plan as
provided herein, generally effective as of July 1, 2000, and redesignates the
A. H. Belo Corporation Employee Savings and Investment Plan as the Belo Savings
Plan. The Plan is a profit sharing plan with a cash or deferred arrangement
intended to qualify under Code section 401(a) and to meet the requirements of
Code section 401(k). The Company has entered into trust agreements with
Fidelity Management Trust Company and U. S. Trust Company of California, N.A.
that provide for the investment and reinvestment of the assets of the Plan.
Effective January 1, 1998, the Journal Qualified Compensation Deferral Plan,
the Journal Broadcasting 401(k) Plan, the Copley/Colony, Inc. Retirement Plan,
the Press-Enterprise Tax Deferred Savings Plan and the Gleaner and Journal
Publishing Co. 401(k) Retirement Plan, each of which is qualified defined
contribution plan sponsored by a direct or indirect wholly-owned subsidiary of
the Company, were merged with and into the Plan. The Copley/Colony, Inc.
Retirement Plan holds benefits for certain deferred vested participants and
does not cover any active employees of the Company or any of its subsidiaries.
Individuals who are Employees on June 30, 2000, and who are eligible
to participate in The G. B. Dealey Retirement Plan (the "Pension Plan") or who
will be eligible to participate in the Pension Plan upon completing the Pension
Plan eligibility requirements are being offered an election to waive
participation in and cease accruing benefits under the Pension Plan, generally
effective as of June 30, 2000. Those Employees who elect to cease accruing
benefits or waive participation in the Pension Plan will be eligible to receive
enhanced benefits under this Plan. In addition, Employees hired or rehired on
or after July 1, 2000, who otherwise satisfy the Plan's eligibility
requirements will be eligible to receive the enhanced benefits provided under
the Plan. Employees who continue to accrue benefits under the Pension Plan on
or after July 1, 2000, will not be eligible for enhanced benefits under the
Plan.
Except as otherwise specifically provided in the Plan, the provisions
of the Plan as amended and restated herein will apply to each Employee who
completes an Hour of Service after June 30, 2000; provided, however, that an
Employee's benefit which is protected from being decreased or eliminated in any
respect under Code section 411(d)(6), and the Employee's vested interest in
such benefit, will not be less under the terms of the Plan set forth below than
under the terms of the Plan as in effect on June 30, 2000. In addition, the
benefit of each Participant who terminated employment on or before June 30,
2000, and who did not again become an Employee after that date will be
determined under the terms of the Plan in effect on June 30, 2000.
Words and phrases with initial capital letters used throughout the
Plan are defined in Article 1.
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TABLE OF CONTENTS
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Page
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ARTICLE 1 DEFINITIONS.....................................................1
ARTICLE 2 PARTICIPATION...................................................9
ARTICLE 3 CONTRIBUTIONS..................................................12
ARTICLE 4 ALLOCATIONS TO PARTICIPANTS' ACCOUNTS..........................15
ARTICLE 5 VESTING........................................................18
ARTICLE 6 DISTRIBUTIONS TO PARTICIPANTS..................................20
ARTICLE 7 DISTRIBUTIONS TO BENEFICIARIES.................................27
ARTICLE 8 PROVISIONS REGARDING COMPANY STOCK.............................29
ARTICLE 9 ADMINISTRATION OF THE PLAN AND TRUST AGREEMENT.................32
ARTICLE 10 LIMITATIONS ON CONTRIBUTIONS AND ALLOCATIONS TO
PARTICIPANTS' ACCOUNTS.........................................36
ARTICLE 11 RESTRICTIONS ON DISTRIBUTIONS TO PARTICIPANTS AND
BENEFICIARIES..................................................48
ARTICLE 12 TOP-HEAVY PROVISIONS...........................................50
ARTICLE 13 ADOPTION OF PLAN BY CONTROLLED GROUP MEMBERS...................55
ARTICLE 14 AMENDMENT OF THE PLAN..........................................56
ARTICLE 15 TERMINATION, PARTIAL TERMINATION AND COMPLETE
DISCONTINUANCE OF CONTRIBUTIONS................................57
ARTICLE 16 MISCELLANEOUS..................................................58
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(i)
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ARTICLE 1
DEFINITIONS
1.1 "Account" means the records, including subaccounts, maintained by
the Committee in the manner provided in Article 4 to determine the interest of
each Participant in the assets of the Plan and may refer to any or all of the
Participant's Deferral Contribution Account, Matching Contribution Account,
Profit Sharing Account and Transfer Account.
1.2 "Beneficiary" means the one or more persons or entities entitled
to receive distribution of a Participant's interest in the Plan in the event of
his death as provided in Article 7.
1.3 "Board of Directors" or "Board" means the Board of Directors of
the Company.
1.4 "Code" means the Internal Revenue Code of 1986, as amended from
time to time.
1.5 "Committee" or "Administrative Committee" means the Committee
appointed under Article 9.
1.6 "Company" means A. H. Belo Corporation, a Delaware corporation.
1.7 "Company Stock" means the Series A Common Stock, par value $1.67
per share, and the Series B Common Stock, par value $1.67 per share, of the
Company.
1.8 "Compensation" means the base pay, overtime pay, shift
differential pay, premium pay, bonuses and commissions paid to an Employee by
the Participating Employers for services performed for the Participating
Employers, excluding any other form of remuneration. In addition, Compensation
includes any contributions made by the Participating Employers on behalf of an
Employee pursuant to a deferral election under the Plan or under any other
employee benefit plan containing a cash or deferred arrangement under Code
section 401(k) and any amounts that would have been received as cash but for an
election to receive benefits under a cafeteria plan meeting the requirements of
Code section 125. The annual Compensation of an Employee taken into account for
any purpose will not exceed $200,000 for any Plan Year ending before January 1,
1994, as adjusted in regulations prescribed by the Secretary of the Treasury,
and will not exceed $150,000 for any Plan Year beginning after December 31,
1993, as adjusted in regulations prescribed by the Secretary of the Treasury.
For Plan Years beginning before January 1, 1997, for purposes of applying the
$200,000 and $150,000 limits set forth in the preceding sentence, if an
Employee is a Highly Compensated Employee (as defined in Section 10.2(m)) who
is either (i) a 5-percent owner, determined in accordance with Code section
414(q) and the Treasury Regulations promulgated thereunder or (ii) one of the
10 most highly compensated Employees ranked on the basis of Compensation paid
by the Controlled Group during the year, such Highly Compensated Employee
and the members of his family (as hereafter defined) will be treated as a
single employee and the Compensation of each member of the family will be
aggregated with the Compensation of the Highly Compensated Employee. The
limitation on Compensation will be allocated among such Highly Compensated
Employee
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and his family members in proportion to each individual's Compensation. For
purposes of this Section, the term "family" means an Employee's spouse and any
lineal descendants who are under age 19 at the end of the Plan Year in
question. The annual Compensation of an Employee who is covered by a collective
bargaining agreement will also be subject to any applicable limit on the amount
of such Compensation that may be taken into account for purposes of the Plan.
1.9 "Controlled Group" means the Company and all other corporations,
trades and businesses, the employees of which, together with employees of the
Company, are required by the first sentence of subsection (b), by subsection
(c), by subsection (m) or by subsection (o) of Code section 414 to be treated
as if they were employed by a single employer.
1.10 "Controlled Group Member" means each corporation or
unincorporated trade or business that is or was a member of the Controlled
Group, but only during such period as it is or was such a member.
1.11 "Deferral Contribution" means the amount of a Participant's
Compensation that he elects to have contributed to the Plan by the
Participating Employers rather than paid to him directly in cash.
1.12 "Deferral Contribution Account" means the Account established for
each Participant, the balance of which is attributable to the Participant's
Deferral Contributions and earnings and losses of the Trust Fund with respect
to such contributions.
1.13 "Effective Date" means July 1, 2000.
1.14 "Employee" means any individual who is: (i) employed by any
Controlled Group Member if their relationship is, for federal income tax
purposes, that of employer and employee, or (ii) "a leased employee" of a
Controlled Group Member within the meaning of Code section 414(n)(2) but only
for purposes of the requirements of Code section 414(n)(3).
1.15 "Entry Date" means January 1, April 1, July 1 and October 1 of
each Plan Year.
1.16 "ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time.
1.17 "Hour of Service" means each hour credited in accordance with the
following rules:
(a) Credit for Services Performed. An Employee will be credited
with one Hour of Service for each hour for which he is paid, or entitled to
payment, by one or more Controlled Group Members for the performance of duties.
(b) Credit for Periods in Which No Services Are Performed. An
Employee will be credited with one Hour of Service for each hour for which he
is paid, or entitled to payment, by one or more Controlled Group Members on
account of a period of time during which no duties are performed (irrespective
of whether the employment relationship has terminated); except that (i) no more
than 501 Hours of Service will be credited under this subsection (b) to an
Employee on account of any single continuous period during which he
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performs no duties (whether or not such period occurs in a single Plan Year),
(ii) an hour for which an Employee is directly or indirectly paid, or entitled
to payment, on account of a period during which no duties are performed will
not be credited to the Employee if the payment is made or due under a plan
maintained solely for the purpose of complying with applicable workers'
compensation or unemployment compensation or disability insurance laws, and
(iii) Hours of Service will not be credited for a payment which solely
reimburses an Employee for medical or medically related expenses incurred by
the Employee. For purposes of this subsection (b), an Employee will be credited
with Hours of Service on the basis of his regularly scheduled working hours per
week (or per day if he is paid on a daily basis) or, in the case of an Employee
without a regular work schedule, on the basis of 40 Hours of Service per week
(or 8 Hours of Service per day if he is paid on a daily basis) for each week
(or day) during the period of time during which no duties are performed; except
that an Employee will not be credited with a greater number of Hours of Service
for a period during which no duties are performed than the number of hours for
which he is regularly scheduled for the performance of duties during the period
or, in the case of an Employee without a regular work schedule, on the basis of
40 Hours of Service per week (or 8 Hours of Service per day if he is paid on a
daily basis).
(c) Credit for Back Pay. An Employee will be credited with one
Hour of Service for each hour for which back pay, irrespective of mitigation of
damages, has been either awarded or agreed to by one or more Controlled Group
Members; except that an hour will not be credited under both subsection (a) or
(b), as the case may be, and this subsection (c), and Hours of Service credited
under this subsection (c) with respect to periods described in subsection (b)
will be subject to the limitations and provisions under subsection (b).
(d) Credit for Certain Absences. If an Employee is absent from
work on or after the Effective Date for any period by reason of the pregnancy
of the Employee, by reason of the birth of a child of the Employee, by reason
of the placement of a child with the Employee, or for purposes of caring for a
child for a period beginning immediately following the birth or placement of
that child, the Employee will be credited with Hours of Service (solely for the
purpose of determining whether he has a One Year Break in Service under the
Plan) equal to (i) the number of Hours of Service which otherwise would
normally have been credited to him but for his absence, or (ii) if the number
of Hours of Service under clause (i) is not determinable, 8 Hours of Service
per normal workday of the absence, provided, however, that the total number of
Hours of Service credited to an Employee under this subsection (d) by reason of
any pregnancy, birth or placement will not exceed 501 Hours of Service. Hours
of Service will not be credited to an Employee under this subsection (d) unless
the Employee furnishes to the Committee such timely information as the
Committee may reasonably require to establish that the Employee's absence from
work is for a reason specified in this subsection (d) and the number of days
for which there was such an absence.
(e) Manner of Counting Hours. No hour will be counted more than
once or be counted as more than one Hour of Service even though the Employee
may receive more than straight-time pay for it. With respect to Employees whose
compensation is not determined on the basis of certain amounts for each hour
worked during a given period and for whom hours are not required to be counted
and recorded by any federal law (other than ERISA), Hours of Service will be
credited on the basis of 10 Hours of Service daily, 45 Hours of Service weekly,
95 Hours of Service semi-monthly, or 190 Hours of Service monthly, if the
Employee's compensation is
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determined on a daily, weekly, semi-monthly or monthly basis, respectively, for
each period in which the Employee would be credited with at least one Hour of
Service under this section. Except as otherwise provided in subsection (d),
Hours of Service will be credited to eligibility and vesting computation
periods in accordance with the provisions of 29 C.F.R. Section 2530.200b-2,
which provisions are incorporated in this Plan by reference.
1.18 "Matching Contribution Account" means the Account established for
each Participant, the balance of which is attributable to Participating
Employer matching contributions made pursuant to Article 3 and earnings and
losses of the Trust Fund with respect to such contributions.
1.19 "One Year Break in Service" means a period of at least 12
consecutive months in which an Employee is absent from service. A One Year
Break in Service will begin on the Employee's termination date (as defined in
Section 1.31) and will end on the day on which the Employee again performs an
Hour of Service for a Controlled Group Member.
If an Employee who is absent from work with a Controlled Group
Member because of (i) the Employee's pregnancy, (ii) the birth of the
Employee's child, (iii) the placement of a child with the Employee in
connection with the Employee's adoption of the child, or (iv) caring for such
child immediately following such birth or placement, will be absent for such
reason beyond the first anniversary of the first date of his absence, his
period of absence, solely for purposes of preventing a One Year Break in
Service, will commence on the second anniversary of the first day of his
absence from work. The period of absence from work between the first and second
anniversaries of the first date of his absence from work will not be taken into
account in determining whether the Employee has completed a Year of Service.
The provisions of this paragraph will not apply to an Employee unless the
Employee furnishes to the Committee such timely information that the Committee
may reasonably require to establish (i) that the absence from work is for one
of the reasons specified in this paragraph and (ii) the number of days for
which there was such an absence.
Notwithstanding the foregoing, if an Employee is classified as a
part-time Employee in accordance with standard personnel practices of his
Participating Employer and is subject to the 1,000 Hour of Service requirement
of Section 1.31, the term 'One Year Break in Service' means a 12 consecutive
month computation period (determined under Section 1.31) in which the Employee
fails to complete more than 500 Hours of Service.
1.20 "Participant" means an Employee or former Employee who has met
the applicable eligibility requirements of Article 2 and who has not yet
received a distribution of the entire amount of his vested interest in the
Plan. In addition, the term "Participant" will include any other Employee of a
Participating Employer who makes Rollover Contribution or a Transfer
Contribution, provided, however, that the provisions of Article 3 (other than
Section 3.7) and Article 10 will not apply to such Employee until he has met
the applicable eligibility requirements of Article 2.
1.21 "Participating Employer" means each Controlled Group Member set
forth on Appendix A and any other Controlled Group Member or organizational
unit of the Company or a
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Controlled Group Member which is designated as a Participating Employer under
the Plan by the Board of Directors.
1.22 "Plan" means the Belo Savings Plan set forth herein, as amended
from time to time.
1.23 "Plan Year" means the period with respect to which the records of
the Plan are maintained, which will be the 12-month period beginning on January
1 and ending on December 31.
1.24 "Profit Sharing Account" means the Account established for each
Participant, the balance of which is attributable to Participating Employer
profit sharing contributions made pursuant to Article 3 and earnings and losses
of the Trust Fund with respect to such contributions.
1.25 "Qualified Plan" means an employee benefit plan that is qualified
under Code section 401(a).
1.26 "Transfer Account" means the Account established for each
Participant, the balance of which is attributable to the Participant's rollover
and transfer contributions made pursuant to Article 3 and earnings and losses
of the Trust Fund with respect to such contributions.
1.27 "Trust Agreement" means the agreement or agreements executed by
the Company and the Trustee which establishes a trust fund to provide for the
investment, reinvestment, administration and distribution of contributions made
under the Plan and the earnings thereon, as amended from time to time.
1.28 "Trust Fund" means the assets of the Plan held by the Trustee
pursuant to the Trust Agreement.
1.29 "Trustee" means the one or more individuals or organizations who
have entered into the Trust Agreement as Trustee, and any duly appointed
successor.
1.30 "Valuation Date" means the date with respect to which the Trustee
determines the fair market value of the assets comprising the Trust Fund or any
portion thereof. The assets of the Trust Fund will be valued as of the close of
business on each day on which the New York Stock Exchange is open for trading.
1.31 "Year of Service" means each period of 365 days (determined by
aggregating periods of service that are not consecutive) beginning on the date
an Employee is first credited with an Hour of Service (or is again credited
with an Hour of Service following his reemployment) and ending on the earlier
of (i) the date on which the Employee quits, retires, is discharged or dies or
(ii) the first anniversary of the date on which the Employee is absent from
service with a Controlled Group Member for any other reason, such as vacation,
holiday, sickness, disability, leave of absence or layoff (the earlier of such
dates is hereafter referred to as the Employee's "termination date"). An
Employee's period of service for purposes of determining a Year of Service will
include each period in which the Employee is absent from
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service for less than 12 months (measured from the Employee's termination date)
and any periods during which he is in the service of the armed forces of the
United States and his reemployment rights are guaranteed by law, provided he
returns to employment with a Controlled Group Member within the time such
rights are guaranteed.
Notwithstanding the foregoing, if an Employee is classified as a
part-time Employee in accordance with standard personnel practices of his
Participating Employer, the term 'Year of Service' means the completion of
1,000 Hours of Service during the 12 consecutive months beginning on the date
the Employee first performs an Hour of Service, or during the 12 consecutive
months beginning on any anniversary of such date.
If a part-time Employee who is subject to the 1,000 Hour of
Service requirement of this Section transfers to full-time status, his service
for the computation period in which the transfer occurs (but not for prior
computation periods) will be determined under the elapsed time method, or if
more favorable to the Employee, on the basis of his Hours of Service completed
as of the date of such transfer. If a full-time Employee transfers to part-time
status and becomes subject to the 1,000 Hour of Service requirement of this
Section, he will receive credit for service under the elapsed time method
through the date of the transfer, and his service during the computation period
in which the transfer occurs will be credited on the basis of Hours of Service
(with any fractional year prior to the date of transfer converted to hours on
the basis of 190 Hours of Service for each month in which the Employee was
credited with at least one Hour of Service).
In determining whether an Employee of WWL-TV, Inc., a Delaware
corporation ("WWL-TV"), has completed a Year of Service for purposes of
eligibility to participate under Section 2.1, each such Employee who became an
employee of WWL-TV on June 1, 1994, and who immediately prior to that date was
an employee of Rampart Operating Partnership, a partnership organized under the
laws of the State of Louisiana ("Rampart"), will receive credit for an Hour of
Service for each hour for which the Employee was paid or entitled to payment by
Rampart or any affiliate of Rampart determined in accordance with Section 1.17
and will receive credit for his period of employment with Rampart or any
affiliate of Rampart calculated in the same manner as if it had been employment
with a Controlled Group Member.
In determining whether an Employee of Bryan-College Station
Eagle, Inc., a Delaware corporation ("Bryan-College Station"), has completed a
Year of Service for purposes of eligibility to participate under Section 2.1,
each such Employee who became an employee of Bryan-College Station on December
26, 1995, and who immediately prior to that date was an employee of Worrell
Enterprises, Inc. ("Worrell") or Eagle Publishing Limited Partnership ("Eagle
Publishing"), or any affiliate of either company, will receive credit for an
Hour of Service for each hour for which the Employee was paid or entitled to
payment by Worrell, Eagle Publishing or any affiliate of either company
determined in accordance with Section 1.17 and will receive credit for his
period of employment with Worrell, Eagle Publishing or any affiliate of either
company calculated in the same manner as if it had been employment with a
Controlled Group Member.
In determining whether an Employee of Owensboro
Messenger-Inquirer, Inc., a Delaware corporation ("Owensboro"), has completed a
Year of Service for purposes of
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eligibility to participate under Section 2.1, each such Employee who became an
employee of Owensboro on January 1, 1996, and who immediately prior to that date
was an employee of Owensboro Publishing Company ("OPC"), will receive credit for
an Hour of Service for each hour for which the Employee was paid or entitled to
payment by OPC or any affiliate of OPC determined in accordance with Section
1.17 and will receive credit for his period of employment with OPC or any
affiliate of OPC calculated in the same manner as if it had been employment with
a Controlled Group Member.
An Employee who became an employee of KMOV-TV, Inc. on June 2,
1997, and who immediately prior to that date was an employee of Viacom
Broadcasting of Missouri, Inc. ("Viacom") will receive credit for an Hour of
Service for each hour for which such Employee was paid or entitled to be paid
by Viacom or any affiliate of Viacom determined in accordance with Section 1.17
and will receive credit for his period of employment with Viacom or any
affiliate of Viacom calculated in the same manner as if it had been employment
with a Controlled Group Member.
An Employee who became an employee of Henderson Gleaner, Inc. on
March 31, 1997, and who immediately prior to that date was an employee of
Gleaner and Journal Publishing Co. will receive credit for an Hour of Service
for each hour for which such Employee was paid or entitled to be paid by
Gleaner and Journal Publishing Co. or any affiliate of Gleaner and Journal
Publishing Co. determined in accordance with Section 1.17 and will receive
credit for his period of employment with Gleaner and Journal Publishing Co. or
any affiliate of Gleaner and Journal Publishing Co. calculated in the same
manner as if it had been employment with a Controlled Group Member.
An Employee who was an employee of The Providence Journal
Company or any affiliate of The Providence Journal Company on February 28,
1997, prior to its merger with and into Belo Holdings, Inc. will receive credit
for an Hour of Service for each hour for which such Employee was paid or
entitled to be paid by The Providence Journal Company or any affiliate of The
Providence Journal Company determined in accordance with Section 1.17 and will
receive credit for his period of employment with The Providence Journal Company
or any affiliate of The Providence Journal Company calculated in the same
manner as if it had been employment with a Controlled Group Member.
An Employee who was an employee of Press-Enterprise Company or
any affiliate of Press-Enterprise Company on July 25, 1997, will receive credit
for an Hour of Service for each hour for which such Employee was paid or
entitled to be paid by Press- Enterprise Company or any affiliate of
Press-Enterprise Company determined in accordance with Section 1.17 and will
receive credit for his period of employment with Press-Enterprise Company or
any affiliate of Press-Enterprise Company calculated in the same manner as if
it had been employment with a Controlled Group Member.
An Employee who became an employee of KENS-TV, Inc. on October
15, 1997, and who immediately prior to that date was an employee of Harte-Hanks
Communications, Inc. will receive credit for an Hour of Service for each hour
for which such Employee was paid or entitled to be paid by Harte-Hanks
Communications, Inc. or any affiliate of Harte-Hanks Communications, Inc.
determined in accordance with Section 1.17 and will receive credit for his
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period of employment with Harte-Hanks Communications, Inc. or any affiliate of
Harte-Hanks Communications, Inc. calculated in the same manner as if it had
been employment with a Controlled Group Member.
An Employee who became an employee of KVUE Television, Inc., a
Delaware corporation, on June 1, 1999, and who immediately prior to that date
was an employee of KVUE Television, Inc., a Michigan corporation, will receive
credit for an Hour of Service for each hour for which such Employee was paid or
entitled to be paid by KVUE Television, Inc., a Michigan corporation, or any of
its affiliates, determined in accordance with Section 1.17 and will receive
credit for his period of employment with KVUE Television, Inc., a Michigan
corporation, or any of its affiliates, calculated in the same manner as if it
had been employment with a Controlled Group Member.
An Employee who became an employee of KTVK, Inc., a Delaware
corporation, on November 1, 1999, and who immediately prior to that date was an
employee of MAC America Communications, Inc., an Arizona corporation, will
receive credit for an Hour of Service for each hour for which such Employee was
paid or entitled to be paid by MAC America Communications, Inc., an Arizona
corporation, or any of its affiliates determined in accordance with Section
1.17 and will receive credit for his period of employment with MAC America
Communications, Inc., an Arizona corporation, or any of its affiliates,
calculated in the same manner as if it had been employment with a Controlled
Group Member.
An Employee who was an employee of Denton Publishing Company, a
Texas corporation, on July 1, 1999, will receive credit for an Hour of Service
for each hour for which such Employee was paid or entitled to be paid by Denton
Publishing Company, a Texas corporation, or any of its affiliates determined in
accordance with Section 1.17 and will receive credit for his period of
employment with Denton Publishing Company, a Texas corporation, or any of its
affiliates calculated in the same manner as if it had been employment with a
Controlled Group Member.
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ARTICLE 2
PARTICIPATION
2.1 Eligibility to Participate. Each Employee who had both attained age
21 and completed a Year of Service before the Effective Date will be a
Participant as of the first payroll period beginning on or after the Effective
Date, if he is then employed by a Participating Employer. Each Employee who is
not a Participant as of the Effective Date will become a Participant as of the
first payroll period beginning on or after the first Entry Date following the
date he has both attained age 21 and completed a Year of Service, if he is then
employed by a Participating Employer.
2.2 Exclusions from Participation.
(a) Ineligible Employees. An Employee who is otherwise eligible
to participate in the Plan will not become or continue as an active Participant
if (i) he is covered by a collective bargaining agreement that does not
expressly provide for participation in the Plan, provided that the
representative of the Employees with whom the collective bargaining agreement is
executed has had an opportunity to bargain concerning retirement benefits for
those Employees; (ii) he is represented by a bargaining representative but is
not covered by a collective bargaining agreement, unless the Company and the
bargaining representative agree in writing that the Employee will be eligible to
participate in the Plan; (iii) he is a nonresident alien who receives no earned
income (within the meaning of Code section 911(d)(2)) from a Participating
Employer which constitutes income from sources within the United States (within
the meaning of Code section 861(a)(3)); (iv) he is a leased employee required to
be treated as an Employee under Code section 414(n) or otherwise performs
services under an arrangement with an employment agency, leasing organization or
any other person or entity that provides personnel to one or more Controlled
Group Members; (v) he is classified by a Participating Employer as an
independent contractor whose compensation for services is reported on a form
other than Form W-2 or any successor form for reporting wages paid to employees;
(vi) he is employed by a Controlled Group Member or an organizational unit
thereof that has not been designated as a Participating Employer by the Board;
or (vii) he is then on an approved leave of absence without pay or in the
service of the armed forces of the United States. An individual described in
clause (iv) or (v) of this subsection (a) who is subsequently determined to be a
common law employee of a Participating Employer will not be eligible to
participate in the Plan during any period prior to the date on which such
determination is actually and finally made.
(b) Exclusion after Participation. A Participant who becomes
ineligible under subsection (a) may not elect to have Deferral Contributions
made or continued to the Plan and will not be eligible to receive an allocation
of Participating Employer matching or profit sharing contributions.
(c) Participation after Exclusion. An Employee or Participant who
is excluded from active participation will be eligible to participate in the
Plan on the first day he is no longer described in subsection (a) and is
credited with one or more Hours of Service by a Participating Employer, provided
that he has otherwise met the requirements of Section 2.1.
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This subsection will apply to an Employee who returns from an approved leave of
absence or from military leave and who would otherwise be treated as a new
Employee under Section 2.3 only if he returns to employment with a Controlled
Group Member immediately following the expiration of the leave of absence or, in
the case of an Employee on military leave, during the period in which
reemployment rights are guaranteed by law.
2.3 Reemployment Provisions. All Hours of Service are counted in
determining eligibility to participate, except as otherwise provided in this
Section.
(a) Termination of Employment before Participation. If an
Employee terminates employment before becoming a Participant and is reemployed
by a Controlled Group Member before incurring a number of consecutive One Year
Breaks in Service at least equal to the greater of five or his aggregate Years
of Service, he will become a Participant on the later of the Entry Date
initially determined under Section 2.1 or the date he is credited with one or
more Hours of Service by a Participating Employer after reemployment; but if he
is reemployed by a Controlled Group Member after incurring a number of
consecutive One Year Breaks in Service at least equal to the greater of five or
his aggregate Years of Service, he will be treated as a new Employee for
purposes of the Plan and his Hours of Service completed before his reemployment
will be disregarded in determining when he will become a Participant.
(b) Termination of Employment after Participation. A Participant
who terminates employment will again become an active Participant immediately
upon his reemployment by a Participating Employer.
2.4 Veterans' Reemployment Rights. The provisions of this Section will
apply to any Employee who is reemployed by a Controlled Group Member on or after
December 12, 1994, following a period of Qualified Military Service.
(a) Service Credit. An Employee who returns to employment with a
Controlled Group Member following a period of Qualified Military Service (as
hereinafter defined) will not be treated as having incurred any One Year Breaks
in Service because of his period of Qualified Military Service. In addition,
each period of Qualified Military Service will, upon reemployment with a
Controlled Group Member, be deemed to be employment with such Controlled Group
Member for purposes of the Plan.
(b) Compensation. An Employee described in subsection (a) above
will be treated for Plan purposes as having received compensation from the
Controlled Group Member during each period of Qualified Military Service equal
to (i) the compensation the Employee would have received during such period of
Qualified Military Service if he were not in Qualified Military Service, based
on the rate of pay the Employee would have received from the Controlled Group
Member but for his absence during the period of Qualified Military Service or
(ii) if the compensation the Employee would have received during his period of
Qualified Military Service is not reasonably certain, the Employee's average
compensation from the employer during the 12-month period immediately preceding
the Qualified Military Service, or if shorter, during the period of employment
immediately preceding the Qualified Military Service.
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<PAGE> 14
(c) Qualified Military Service. For purposes of the Plan, the
term "Qualified Military Service" means service in the uniformed services
(within the meaning of the Uniformed Services Employment and Reemployment Rights
Act ("USERRA"), provided the Employee is entitled under USERRA to reemployment
rights with a Controlled Group Member and the Employee returns to employment
with the Controlled Group Member within the period in which such reemployment
rights are guaranteed.
(d) Make-Up Contributions. Pursuant to procedures adopted from
time to time by the Committee, an Employee described in subsection (a) above may
elect additional Deferral Contributions and will receive an allocation of
additional Participating Employer matching contributions and, if applicable,
profit sharing contributions, for the period of his Qualified Military Service.
Such additional Deferral Contributions and Participating Employer matching
contributions may be made during the period that begins on the date of the
Employee's reemployment and extends for the lesser of five years or the duration
of the Employee's Qualified Military Service multiplied by three. An Employee's
Deferral Contributions and allocation of Participating Employer matching
contributions made pursuant to this Section will be subject to the limitations
of the Plan and the Code applicable to the years of the Employee's period of
Qualified Military Service, except that the Average Deferral Percentage and
Average Contribution Percentage limitations described in Article 10 will not be
recalculated for such years and will be determined for the Plan Years in which
the make-up Deferral Contributions and Participating Employer matching
contributions are made without regard to such make-up Deferral Contributions and
Participating Employer matching contributions.
(e) Loan Repayments. An Employee may elect to suspend the
repayment of a Plan loan during a period of Qualified Military Service as
permitted under Code section 414(u)(4) or may elect to continue loan repayments
during such period.
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<PAGE> 15
ARTICLE 3
CONTRIBUTIONS
3.1 Participant Deferral Contributions.
(a) Amount of Deferral Contributions. A Participant may elect, in
accordance with procedures established by the Committee from time to time, to
have Deferral Contributions made to the Plan by the Participating Employers,
provided the amount of the Participant's Deferral Contributions to the Plan for
any payroll period will not exceed 15% of his Compensation for such period.
(b) Modification and Suspension of Deferral Contributions. A
Participant may increase or decrease the amount of his Deferral Contributions
during the Plan Year, provided that only one such modification may be made
during each calendar month of the Plan Year. A Participant may suspend his
Deferral Contributions at any time during the Plan Year, and a suspension of his
Deferral Contributions will not be considered a modification for purposes of
this subsection (b). A Participant who suspends his Deferral Contributions may
not again authorize Deferral Contributions to the Plan until the first day of
the calendar quarter following such suspension, or such other time as the
Committee prescribes. If a Participant receives a distribution on account of
hardship pursuant to Section 6.3, such Participant's Deferral Contributions will
automatically be suspended for a 12-month period following the date on which
such Participant receives the hardship distribution. The Committee will adopt
from time to time procedures for administering the rules contained in this
subsection.
(c) Limitations on Deferral Contributions. The sum of a
Participant's Deferral Contributions and his elective deferrals (within the
meaning of Code section 402(g)(3)) under any other plans, contracts or
arrangements of any Controlled Group Member will not exceed $7,000 (as adjusted
for cost of living increases in the manner described in Code section 415(d)) for
any taxable year of the Participant. A Participant's Deferral Contributions will
also be subject to the deferral percentage limitation set forth in Section 10.6.
In the event a Participant's Deferral Contributions and other elective deferrals
(whether or not under a plan, contract or arrangement of a Controlled Group
Member) for any taxable year exceed the foregoing $7,000 limitation, the excess
allocated by the Participant to Deferral Contributions (adjusted for Trust Fund
earnings and losses in the manner described in Section 10.6(d)) may, in the
discretion of the Committee, be distributed to the Participant no later than
April 15 following the close of such taxable year. The amount of Deferral
Contributions distributed to a Participant for a Plan Year pursuant to this
Section will be reduced by any excess Deferral Contributions previously
distributed to him pursuant to Section 10.6(c) for the same Plan Year.
3.2 Participating Employer Matching Contributions.
(a) 75% Matching Contribution. The Participating Employers will
pay to the Trustee as a matching contribution for each payroll period an amount
equal to 75% of each eligible Participant's Deferral Contributions made on and
after July 1, 2000, but only to the extent that the Participant's Deferral
Contributions do not exceed 6% of the Participant's
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<PAGE> 16
Compensation for the payroll period. A Participant will be an eligible
Participant for purposes of the 75% matching contribution only if (i) the
Participant first became employed by a Participating Employer after June 30,
2000, or (ii) if the Participant first became employed by a Participating
Employer before July 1, 2000, the Participant is not accruing a benefit under
The G. B. Dealey Retirement Pension Plan or any other qualified defined benefit
pension plan sponsored by the Company or any Controlled Group Member during any
portion of a payroll period for which a Participating Employer is making
Deferral Contributions on behalf of the Participant.
(b) 55% Matching Contribution. With respect to each Participant
other than a Participant described in Section 3.2(a), the Participating
Employers will pay to the Trustee as a matching contribution for each payroll
period an amount equal to 55% of the Participant's Deferral Contributions but
only to the extent that the Participant's Deferral Contributions do not exceed
6% of the Participant's Compensation for the payroll period.
(c) Additional Matching Contributions. Each Participating
Employer may make a matching contribution for any Plan Year, in addition to the
matching contributions provided under Section 3.2(a) and (b), if authorized by
its board of directors and approved by the Compensation Committee of the Board
of Directors, but no Participating Employer will be required to make an
additional matching contribution for any Plan Year.
(d) Contributions in Cash or in Stock. Participating Employer
matching contributions may be made in cash or in shares of Company Stock or
both.
(e) Limitation on Matching Contributions. Participating Employer
matching contributions will be subject to the contribution percentage limitation
set forth in Section 10.7.
3.3 Profit Sharing Contributions. The Participating Employers will pay
to the Trustee as a profit sharing contribution for each payroll period an
amount equal to 2% of the Compensation paid on and after July 1, 2000, to each
Participant who is eligible to receive a 75% matching contribution under Section
3.2(a). Each Participating Employer may, in the discretion of its board of
directors, make an additional, discretionary profit sharing contribution to the
Plan for any payroll period or for any Plan Year in such amount as is determined
by the Participating Employer and is approved by the Compensation Committee of
the Board of Directors of the Company.
3.4 Collectively Bargained Employees. Notwithstanding the provisions of
Section 3.2 and Section 3.3, the Participating Employers will not make a
matching contribution or a profit sharing contribution for any Employee who is
covered by collective bargaining agreement unless and until the terms of such
collective bargaining agreement, as amended or renewed from time to time, permit
employer matching and profit sharing contributions to be made. In no event will
the matching contribution or profit sharing contribution made for such an
Employee exceed the amount of matching contributions or profit sharing
contributions permitted under such collective bargaining agreement.
3.5 Time of Payment. Deferral Contributions will be paid to the Trustee
as soon as practicable following the close of each payroll period. Participating
Employer matching
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<PAGE> 17
contributions will be paid to the Trustee as soon as practicable following the
close of each calendar month during the Plan Year, and discretionary profit
sharing contributions may be paid to the Trustee on any date or dates selected
by the Participating Employers, but in no event later than the time prescribed
by law (including extensions) for filing the Participating Employer's federal
income tax return for its tax year ending with or within the Plan Year.
3.6 Investment of Contributions.
(a) Deferral Contributions. The Deferral Contributions allocated
to a Participant's Deferral Contribution Account will be invested by the Trustee
in accordance with the Participant's directions in investment funds established
pursuant to the Trust Agreement.
(b) Matching Contributions. Participating Employer matching
contributions up to 55% of a Participant's Deferral Contributions not in excess
of 6% of Compensation will be invested by the Trustee pursuant to the Trust
Agreement solely in shares of Company Stock, provided, however, that a
Participant who has attained age 55 may direct the Trustee to transfer all or
any portion of his Matching Contribution Account balance to, and to invest all
or any portion of the Participating Employer matching contributions made on his
behalf after his 55th birthday in, any other investment fund established under
the Trust Agreement. Participating Employer matching contributions in excess of
55% of a Participant's Deferral Contributions will be invested by the Trustee in
accordance with the Participant's directions in investment funds established
pursuant to the Trust Agreement.
(c) Profit Sharing Contributions. Participating Employer profit
sharing contributions allocated to a Participant's Profit Sharing Account will
be invested by the Trustee in accordance with the Participant's directions in
investment funds established pursuant to the Trust Agreement.
(d) Investment Directions. The Committee from time to time will
establish rules and procedures regarding Participant investment directions,
including without limitation rules and procedures with respect to the manner in
which such directions may be furnished, the frequency with which such directions
may be changed during the Plan Year, the minimum portion of a Participant's
Account that may be invested in any one investment fund and the default
investment of the Account of a Participant who fails to provide investment
directions.
3.7 Rollover and Transfer Contributions. Unless directed to do so by
the Committee, the Trustee is not authorized to accept (i) any part of the cash
or other assets distributed to a Participant from a Qualified Plan or from an
individual retirement account or annuity described in Code section 408, or (ii)
a direct transfer of assets to the Plan on behalf of a Participant from the
trustee or other funding agent of a Qualified Plan. Any amounts contributed to
the Plan pursuant to this Section will be allocated to the Participant's
Transfer Account and will be invested by the Trustee in accordance with the
Participant's directions in investment funds established pursuant to the Trust
Agreement.
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<PAGE> 18
ARTICLE 4
ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
4.1 Establishment of Accounts. The Committee will establish a Deferral
Contribution Account and a Matching Contribution Account for each Participant,
and to the extent applicable, a Profit Sharing Account and a Transfer Account.
The Committee may also establish one or more subaccounts of a Participant's
Accounts, if the Committee determines that subaccounts are necessary or
desirable in administering the Plan.
4.2 Allocation of Contributions.
(a) Deferral Contributions. Each Deferral Contribution made by a
Participating Employer on behalf of a Participant will be allocated by the
Committee to the Participant's Deferral Contribution Account.
(b) Matching Contributions. Each Participating Employer matching
contribution made with respect to a payroll period on behalf of Participants who
are eligible to receive a 75% matching contribution under Section 3.2(a) will be
allocated by the Committee to the Matching Contribution Accounts of such
Participants employed by that Participating Employer in the ratio that the
Deferral Contributions made on behalf of each such Participant for each payroll
period in the Plan Year bear to the total Deferral Contributions made on behalf
of all such Participants for each such payroll period, taking into account for
purposes of this ratio only Deferral Contributions that do not exceed 6% of each
Participant's Compensation for the payroll period. Each Participating Employer
matching contribution made with respect to a payroll period on behalf of
Participants who are eligible to receive the 55% matching contribution under
Section 3.2(b) will be allocated by the Committee to the Matching Contribution
Accounts of such Participants employed by that Participating Employer in the
ratio that the Deferral Contributions made on behalf of each such Participant
for each payroll period in the Plan Year bears to the total Deferral
Contributions made on behalf of all such Participants for each such payroll
period, taking into account for purposes of this ratio only Deferral
Contributions that do not exceed 6% of each Participant's Compensation for the
payroll period.
(c) Profit Sharing Contributions. Each profit sharing
contribution made by a Participating Employer for a payroll period will be
allocated only to the Profit Sharing Accounts of Participants who are employed
by the Participating Employer on the last day of the payroll period and are
eligible to receive profit sharing contributions pursuant to Section 3.3. For
purposes of this allocation, an Employee will be a Participant in the Plan on
the last day of a payroll period if the Employee is eligible to make Deferral
Contributions as of the last day of the payroll period, without regard to
whether the Participant has elected to make Deferral Contributions. The amount
of a Participating Employer's profit sharing contribution to be allocated to the
Profit Sharing Account of each such eligible Participant for a payroll period
will bear the same ratio to the Participating Employer's total profit sharing
contribution for the payroll period as the Participant's Compensation for the
payroll period bears to the total Compensation of all such Participants eligible
to receive an allocation of the Participating Employer's profit sharing
contribution for the payroll period.
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<PAGE> 19
4.3 Limitation on Allocations. Article 10 sets forth certain rules
under Code sections 401(k), 401(m) and 415 that limit the amount of
contributions and forfeitures that may be allocated to a Participant's Accounts
for a Plan Year.
4.4 Allocation of Trust Fund Income and Loss.
(a) Accounting Records. The Committee, through its accounting
records, will clearly segregate each Account and subaccount and will maintain a
separate and distinct record of all income and losses of the Trust Fund
attributable to each Account or subaccount. Income or loss of the Trust Fund
will include any unrealized increase or decrease in the fair market value of the
assets of the Trust Fund.
(b) Method of Allocation.
(i) General Rule. Except as provided in Section 4.4(b)(ii),
the share of net income or net loss of the Trust Fund to be credited
to, or deducted from, each Account will be the allocable portion of the
net income or net loss of the Trust Fund attributable to each Account
determined by the Committee as of each Valuation Date in a uniform and
nondiscriminatory manner, based upon the ratio that each Account
balance as of the previous Valuation Date bears to all Account balances
after adjustment for withdrawals, distributions and other additions or
subtractions that may be appropriate. The share of net income or net
loss to be credited to, or deducted from, any subaccount will be an
allocable portion of the net income or net loss credited to or deducted
from the Account under which the subaccount is established.
(ii) Special Rule for Deferral Contributions to Purchase
Company Stock. Deferral Contributions that are to be invested in
Company Stock will be invested by the Trustee in short-term
interest-bearing instruments pending the purchase of Company Stock with
such contributions. Interest earned on such Deferral Contributions will
be accumulated until allocated to Participants' Deferral Contribution
Accounts in the manner provided in this paragraph. As soon as
practicable after the last day of each calendar quarter, the Trustee
will purchase additional shares of Company Stock with accumulated
interest, and the additional shares of Company Stock will be credited
to each Deferral Contribution Account by the Committee as net income of
the Trust Fund, in a uniform and nondiscriminatory manner, based on the
ratio that the amount of each eligible Participant's Deferral
Contributions that were invested in Company Stock for the calendar
quarter bears to the total amount of all eligible Participants'
Deferral Contributions that were invested in Company Stock for the
calendar quarter. For purposes of this paragraph, an "eligible
Participant" with respect to an calendar quarter is a Participant who
is an Employee on the last day of the calendar quarter and who elected
to invest Deferral Contributions in Company Stock for the calendar
quarter.
4.5 Valuation of Trust Fund. The fair market value of the total net
assets comprising the Trust Fund will be determined by the Trustee as of each
Valuation Date.
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<PAGE> 20
4.6 No Guarantee. The Participating Employers, the Committee and the
Trustee do not guarantee the Participants or their Beneficiaries against loss or
depreciation or fluctuation of the value of the assets of the Trust Fund.
4.7 Annual Statement of Accounts. The Committee will furnish each
Participant and each Beneficiary of a deceased Participant, at least annually, a
statement showing (i) the value of his Accounts at the end of the Plan Year,
(ii) the allocations to and distributions from his Accounts during the Plan
Year, and (iii) his vested and nonforfeitable interest in his Accounts at the
end of the Plan Year. No statement will be provided to a Participant or
Beneficiary after the Participant's entire vested and nonforfeitable interest in
his Accounts has been distributed.
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<PAGE> 21
ARTICLE 5
VESTING
5.1 Determination of Vested Interest.
(a) Employees on June 30, 2000. Except as provided in Section 5.3
or 10.6(e) (with respect to discriminatory Matching Contributions), the interest
of each Participant who is an Employee on June 30, 2000, in his Accounts will be
100% vested and nonforfeitable at all times.
(b) Employees after June 30, 2000. Except as provided in Section
5.3, the interest of each Participant who becomes an Employee after June 30,
2000, in his Deferral Contribution Account and his Transfer Account will be 100%
vested and nonforfeitable at all times. The interest of each such Participant in
his Matching Contribution Account and his Profit Sharing Account will become
vested and nonforfeitable in accordance with the following schedule, subject to
Sections 5.3 and 10.6(e):
<TABLE>
<CAPTION>
Percent Vested
Years of Service and Nonforfeitable
---------------- ------------------
<S> <C>
Less than 3 0
3 or more 100
</TABLE>
(c) Accelerated Vesting. Except as provided in Section 5.3 or
10.6(e), a Participant's interest in his Matching Contribution Account and his
Profit Sharing Account will become 100% vested and nonforfeitable without regard
to his Years of Service upon the earliest to occur of (i) his attainment of age
55 if he is then an Employee, (ii) his death while he is an Employee, or (iii)
his becoming totally and permanently disabled (as hereinafter defined) while he
is an Employee. A person will be totally and permanently disabled for purposes
of this paragraph only if he is eligible to receive disability benefits under
the Social Security Act.
5.2 Forfeiture of Nonvested Amounts. Upon termination of employment, a
Participant who has a 0% vested interest in the portion of his Account
attributable to Participating Employer matching and profit sharing contributions
will be deemed to receive a distribution of his vested interest, and the
Participant's entire nonvested interest will be forfeited immediately. If the
Participant again becomes an Employee before incurring five or more consecutive
One Year Breaks in Service, the forfeited amounts will be reinstated to his
Account, unadjusted for earnings or losses since the date of forfeiture. If the
Participant becomes an Employee after incurring five or more consecutive One
Year Breaks in Service, the forfeited amounts will not be reinstated.
5.3 Unclaimed Distribution. If the Committee cannot locate a person
entitled to receive a benefit under the Plan within a reasonable period (as
determined by the Committee in its discretion), the amount of the benefit will
be treated as a forfeiture during the Plan Year in
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<PAGE> 22
which the period ends. If, before final distributions are made from the Trust
Fund following termination of the Plan, a person who was entitled to a benefit
which has been forfeited under this Section makes a claim to the Committee or
the Trustee for his benefit, he will be entitled to receive, as soon as
administratively feasible, a benefit in an amount equal to the value of the
forfeited benefit on the date of forfeiture. This benefit will be reinstated
from forfeitures arising during such Plan Year or, if forfeitures are
insufficient, from Participating Employer contributions made to the Plan for
this purpose.
5.4 Application of Forfeited Amounts. The amount of a Participant's
Accounts which is forfeited pursuant to this Article or Section 10.6(e) will be
applied first to reinstate any forfeitures that must be reinstated in accordance
with this Article, next to reduce Participating Employer matching contributions
pursuant to Section 3.2 and last to reduce Participating Employer profit sharing
contributions pursuant to Section 3.3.
5.5 Reemployment Provisions. If a Participant terminates employment and
again becomes an Employee, his Years of Service completed before his
reemployment will be included in determining his vested and nonforfeitable
interest after he again becomes an Employee.
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<PAGE> 23
ARTICLE 6
DISTRIBUTIONS TO PARTICIPANTS
6.1 Basic Rules Governing Distributions.
(a) Timing of Distributions. Except as set forth in Sections 6.2
and 6.3, distribution of a Participant's vested Account Balances will be made as
soon as practicable after the Valuation Date coinciding with or immediately
following the Participant's termination of employment, or if earlier, the date
on which the Participant becomes eligible to receive benefits under the Social
Security Act on account of total and permanent disability. If a loan is
outstanding from the Trust Fund to the Participant on the date his vested
Account balances become distributable, the amount distributed to the Participant
will be reduced by any security interest in his Accounts held by the Plan by
reason of the loan.
(b) Form of Distributions.
(i) Normal Form of Distribution. The normal form of
distribution will be a single lump sum payment. Shares of Company Stock
allocated to a Participant's Accounts will be distributed in the form
of whole shares plus cash for any fractional share, unless the
Participant elects to receive the cash value of such shares.
(ii) Optional Forms of Distribution for Journal Plan
Participants. The optional forms of distribution described in this
paragraph are available for distributions other than withdrawals
described in Section 6.2 and hardship distributions described in
Section 6.3 only to a Participant whose account balances were
transferred to the Plan from the Journal Qualified Compensation
Deferral Plan, the Journal Broadcasting 401(k) Plan or the Journal
Guild Plan, and whose vested Account balances exceed $3,500 ($5,000 for
Plan Years beginning after December 31, 1997). The optional forms of
benefit will be (A) periodic installment payments over a period of
years not to exceed the life expectancy of the Participant or the joint
life expectancy of the Participant and his Beneficiary and (B) a single
life annuity or a Qualified Joint and Survivor Annuity (as hereinafter
defined) purchased from an insurance company with the amount of the
Participant's vested Account balances, provided, however, that the
annuity option will be available to a former participant in the Journal
Broadcasting 401(k) Plan only if he was a participant in such Plan
prior to December 31, 1996. For purposes of this Section, the term
"Qualified Joint and Survivor Annuity" means an annuity payable monthly
for the life of the Participant with a survivor annuity payable monthly
for the life of the Participant's surviving spouse in an amount equal
to 50% of the amount of the monthly payment to the Participant during
his life.
(iii) Optional Form of Distribution for Press-Enterprise and
Gleaner Plan Participants. The optional form of distribution described
in this paragraph is available for distributions other than withdrawals
described in Section 6.2 and hardship distributions described in
Section 6.3 only to a Participant whose account balances were
transferred to the Plan from the Press-Enterprise Tax Deferred Savings
Plan or the
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<PAGE> 24
Gleaner and Journal Publishing Co. 401(k) Retirement Plan and whose
vested Account balances exceed $3,500 ($5,000 for Plan Years beginning
after December 31, 1997). The optional form of benefit will be periodic
installment payments over a period of years not to exceed the life
expectancy of the Participant or the joint life expectancy of the
Participant and his Beneficiary.
(iv) Rules Relating to Annuities. If a married Participant
elects to receive his vested Account balances in the form of a single
life annuity, the Participant's election will not be effective without
the written consent of his spouse, witnessed by a notary public and
acknowledging the effect of such election, unless it is established to
the satisfaction of the Committee that such consent cannot be obtained
because there is no spouse, because the spouse cannot be located, or
because of such other circumstances as regulations under Code section
417 permit. An election under this Section must be made, in accordance
with rules and procedures established from time to time by the
Committee, within 90 days of the date on which the Participant would
receive his first payment of benefits under the Plan. A Participant may
revoke an election to receive an annuity without the consent of his
spouse before the date on which the Trustee purchases the annuity. If a
married Participant revokes a prior election to receive an annuity, he
may elect without the consent of his spouse to receive his vested
Account balances in a lump sum payment, installments or a Qualified
Joint and Survivor Annuity. If a Participant who has elected to receive
an annuity dies before the Trustee has purchased the annuity from an
insurance company, the Participant's vested Account balances will be
paid to the Participant's surviving spouse, if any, and if none, to the
Participant's Beneficiary. If the Participant dies after the Trustee
has purchased the annuity, any benefits payable after the Participant's
death will be determined under the terms of the annuity. For purposes
of the Qualified Joint and Survivor Annuity, the term "spouse" means
the spouse to whom the Participant was married at the time he elected
the Qualified Joint and Survivor Annuity. If such spouse dies before
the Participant, the amount of the Participant's monthly annuity will
not be increased.
(c) Participant's Consent to Certain Payments. If the amount of a
Participant's vested Account balances exceed $3,500 ($5,000 for Plan Years
beginning after December 31, 1997), the Committee will not distribute the
Participant's vested Account balances to him prior to his attainment of age 70
1/2 unless he elects to receive a distribution at any earlier date following
termination of employment. For Plan Years beginning after December 31, 1996, a
distribution may be made less than 30 days after the Participant has been
furnished an explanation of his distribution options provided that (i) the
Committee clearly informs the Participant that he has the right to consider
whether to accept a distribution and whether to consent to a particular form of
distribution for at least 30 days after he has been provided the relevant
information, (ii) the Participant affirmatively elects to waive the 30-day
notice period and receive a distribution, and (iii) with respect to a
distribution to which Code section 417 applies, the Participant is permitted to
revoke the election and make a new election at any time prior to the later of
the date of distribution or the expiration of the seven-day period after the
explanation of distribution options is provided to the Participant. The
foregoing provision will not apply to any distributions required under Sections
10.6 and 10.7.
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<PAGE> 25
6.2 Withdrawals.
(a) After Age 59 1/2. A Participant who has not terminated
employment may request a distribution from his Accounts if he has reached age 59
1/2. A Participant who is a director, officer or principal stockholder of the
Company within the meaning of Section 16 of the Securities Exchange Act of 1934
may exercise the foregoing withdrawal right only in accordance with rules and
procedures established from time to time by the Committee. All other
Participants may exercise their withdrawal rights at any time or times during
the Plan Year.
(b) Former Journal Broadcasting Employees. A Participant who, on
December 31, 1997, was a participant in the Journal Broadcasting 401(k) Plan may
withdraw, in accordance with rules and procedures established from time to time
by the Committee, all or any portion of his Transfer Account attributable to his
after-tax contributions and rollover contributions that were transferred to the
Plan from the Journal Broadcasting 401(k) Plan effective January 1, 1998.
6.3 Hardship Distributions.
(a) General Rule. A Participant who has not terminated employment
may request a distribution from his Deferral Contribution Account in the event
of his hardship; provided, however that a Participant who was a participant in
the Denton Publishing Company Retirement Plan on December 31, 1999, may request
such a distribution only with respect to his Deferral Contributions made on and
after January 1, 2000. A distribution will be on account of hardship only if the
distribution is necessary to satisfy an immediate and heavy financial need of
the Participant, as defined below, and satisfies all other requirements of this
Section. For Plan Years beginning on or after January 1, 1996, pursuant to
Section 3.1(b), a Participant's Deferral Contributions will automatically be
suspended for a 12- month period after the date on which such Participant
receives a distribution on account of hardship.
(b) Deemed Financial Need. For purposes of this Section, a
distribution is made on account of an immediate and heavy financial need of the
Participant only if the distribution is for (i) the payment of medical expenses
described in Code section 213(d) previously incurred by the Participant, the
Participant's spouse or any dependents of the Participant (as defined in Code
section 152) or necessary for such persons to obtain medical care described in
Code section 213(d); (ii) costs directly related to the purchase of a principal
residence for the Participant (excluding mortgage payments); (iii) the payment
of tuition and related educational fees for the next 12 months of post-secondary
education for the Participant, his spouse, children, or dependents (as defined
in Code section 152); (iv) payments necessary to prevent the eviction of the
Participant from his principal residence or foreclosure on the mortgage of the
Participant's principal residence; or (v) the payment of funeral expenses of a
family member.
(c) Reasonable Reliance Test. A distribution will be considered
necessary to satisfy an immediate and heavy financial need of the Participant
only if all three of the following requirements are satisfied: (i) the
distribution is not in excess of the amount required to relieve the immediate
and heavy financial need of the Participant (taking into account the taxable
nature of the distribution); (ii) the Participant represents in writing, on
forms provided by the
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Committee, that the need cannot be relieved through reimbursement or
compensation by insurance or otherwise, by reasonable liquidation of the
Participant's assets, to the extent such liquidation would not itself cause an
immediate and heavy financial need, by cessation of Deferral Contributions under
the Plan, or by distributions other than hardship distributions or nontaxable
(at the time of the loan) loans from the Plan and any other plans maintained by
any Controlled Group Member or any other entity by which the Participant is
employed, or by borrowing from commercial sources on reasonable commercial
terms; and (iii) the Committee determines that it can reasonably rely on the
Participant's written representation.
(d) Limitation for Loans. No distribution under this Section will
be made in an amount that is greater than the excess of the Participant's vested
interest in his Accounts over the aggregate amount of outstanding loans, plus
accrued interest, secured by the Participant's Accounts.
6.4 Distribution Procedures. Distributions pursuant to Sections 6.2 and
6.3 will be made as soon as practicable following the Committee's approval of
the Participant's written request for withdrawal and will be made in the form
described in Section 6.1(b). Distributions pursuant to Sections 6.2(a) and 6.3
will be made pro rata from each of the Participant's Accounts, provided,
however, that in the case of a hardship distribution under Section 6.3, the
cumulative amount distributed to a Participant from his Deferral Contribution
Account will not exceed the amount of his Deferral Contributions that have not
been previously withdrawn (but not the income allocable to his Deferral
Contributions). No distribution under this Section will be made in an amount
that is greater than the excess of the Participant's vested interest in the
Accounts from which the distributions are made over the aggregate amount of
outstanding loans, plus accrued interest, secured by such Accounts. For purposes
of determining the amount available for distribution, a Participant's Accounts
will be valued as of the Valuation Date immediately preceding the date on which
the Participant requests a distribution.
6.5 Loans to Participants.
(a) General Provisions. A Participant may, subject to the
provisions of this Section and the loan procedures adopted by the Committee from
time to time, borrow from the balance of his Deferral Contribution and Transfer
Accounts, provided, however, that no loan may be made from a Participant's
Profit Sharing and Matching Contribution Accounts. All such loans will be
subject to the requirements of this Section and such other rules as the
Committee may from time to time prescribe, including without limitation any
rules restricting the purposes for which loans will be approved. The Committee
will have complete discretion as to approval of a loan hereunder and as to the
terms thereof, provided that its decisions will be made on a uniform and
nondiscriminatory basis and in accordance with this Section. If the Committee
approves a loan, the Committee will direct the Trustee to make the loan and will
advise the Participant and the Trustee of the terms and conditions of the loan.
Nothing in this Section will require the Committee to make loans available to
Participants.
(b) Terms and Conditions. Loans to Participants will be made
according to the following terms and conditions and such additional terms and
conditions as the Committee may from time to time establish: (i) no loan will be
for a term of longer than five years; (ii) all loans will be in default on the
first date that a required loan repayment is not made and the entire
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unpaid balance of the loan will be treated as a deemed distribution to the
Participant unless all past due payments are made before the expiration of any
grace period established under the loan procedures; (iii) all loans will bear a
reasonable rate of interest established under the loan procedures; (iv) all
loans will be made only upon receipt of adequate security (the security for a
loan will be the Participant's interest in the separate investment fund
established under subsection (f) for that loan) in an amount that does not
exceed 50% of the Participant's vested interest under the Plan); (v) except as
otherwise provided by the loan procedures, payments of principal and interest
will be made through payroll deductions sufficient to provide for substantially
level amortization of principal and interest with payments not less frequently
than quarterly, which will be irrevocably authorized by the Participant in
writing on a form provided by the Committee at the time the loan is made; (vi)
the amount of any indebtedness (including accrued and unpaid interest) under any
loan will be deducted from a Participant's interest in the Trust Fund if and
only if such indebtedness or any installment thereof is not paid when due
(including amounts due by acceleration) unless the Committee determines that
there is adequate security for such loan other than the Participant's interest
in the Trust Fund; (vii) no more than one outstanding loan will be permitted
with respect to a Participant at any time, except that a Participant may have a
home loan and a loan which is not a home loan outstanding at the same time;
(viii) for Plan Years beginning on or after January 1, 1996, no more than two
outstanding loans will be permitted with respect to a Participant at any time;
(ix) for Plan Years beginning on or after January 1, 1996, no new home loans
will be permitted; and (x) all loans will be evidenced by a note containing such
additional terms and conditions as the Committee will determine. Notwithstanding
anything in the foregoing to the contrary, no amount of any indebtedness will be
deducted pursuant to subsection (vi) above from a Participant's Accounts prior
to the time that such Accounts are otherwise distributable.
(c) Maximum Amount of Loans. The amount of any loan made pursuant
to this Section, when added to the outstanding balance of all other loans to the
Participant from all qualified employer plans (as defined in Code section
72(p)(4)) of the Controlled Group, will not exceed the lesser of (i) one-half of
the aggregate nonforfeitable interest in his account balance(s) under all such
plans, or (ii) $50,000 reduced by the excess, if any, of (A) the highest
outstanding balance of all other loans from qualified employer plans of the
Controlled Group to the Participant during the 1-year period ending on the date
on which such loan was made, over (B) the outstanding balance of all loans from
qualified employer plans of the Controlled Group to the Participant on the date
on which such loan was made.
(d) Minimum Loan. The minimum loan permitted under this Section
is $1,000. If such minimum amount exceeds the limitations of subsection (c), no
loan will be made.
(e) Source of Loans. All loans will be made pro rata from the
Participant's Deferral Contribution and Transfer Accounts.
(f) Investment of Loan Payments. All loans will be treated as a
separate investment fund of the borrowing Participant. All payments with respect
to a loan will be credited to the borrowing Participant's Accounts and will be
invested in the investment funds under the Trust Agreement in accordance with
the Participant's latest investment directions pursuant to Section 3.6.
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(g) Grandfathered Loans. Loans that are transferred to the Plan
from another Qualified Plan will be administered in accordance with their terms,
notwithstanding the fact that the terms of such loans do not satisfy the
foregoing provisions of this Section.
6.6 Reemployment of Participant. If a Participant who terminated
employment again becomes an Employee before receiving a distribution of his
Account balances, no distribution from the Trust Fund will be made while he is
an Employee, and amounts distributable to him on account of his prior
termination will be held in the Trust Fund until he is again entitled to a
distribution under the Plan.
6.7 Valuation of Accounts. A Participant's distributable Account
balances will be valued as of the Valuation Date immediately preceding the date
the Accounts are to be distributed, except that there will be added to the value
of his Accounts the fair market value of any amounts allocated to his Accounts
under Article 4 after that Valuation Date.
6.8 Direct Rollovers.
(a) Distributions after 1992. Notwithstanding any other provision
of the Plan, for distributions made on or after January 1, 1993, a Distributee
(as hereinafter defined) may elect, at any time and in the manner prescribed by
the Committee, to have any portion of an Eligible Rollover Distribution (as
hereinafter defined) paid directly to an Eligible Retirement Plan (as
hereinafter defined) specified by the Distributee, except to the extent that the
total Eligible Rollover Distributions with respect to the Distributee in any
Plan Year are reasonably expected to total less than $200.
(b) Eligible Rollover Distribution. An Eligible Rollover
Distribution is any distribution of all or any portion of the balance to the
credit of the Distributee, except that an Eligible Rollover Distribution does
not include (i) any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life or life
expectancy of the Distributee or the joint lives or life expectancies of the
Distributee and the Distributee's designated beneficiary, or for a specified
period of ten years or more, (ii) any distribution to the extent such
distribution is required by Code section 401(a)(9), (iii) effective for
distributions after December 31, 1998, any distribution that qualifies as a
hardship distribution under Section 6.3, and (iv) 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).
(c) Eligible Retirement Plan. 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 is a defined contribution plan within the meaning of Code section 414(i),
that accepts the Distributee's Eligible Rollover Distribution. However, in the
case of an Eligible Rollover Distribution to a Participant's surviving Spouse,
an Eligible Retirement Plan is an individual retirement account or individual
retirement annuity.
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(d) Distributee. A Distributee includes a Participant, the
Participant's Spouse, or a Participant's former spouse who is an alternate payee
under a qualified domestic relations order, as defined in Section 414(p) of the
Code.
6.9 Restrictions on Distributions. Article 11 sets forth certain rules
under various provisions of the Code relating to restrictions on distributions
to Participants.
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ARTICLE 7
DISTRIBUTIONS TO BENEFICIARIES
7.1 Designation of Beneficiary. Each Participant will have the right to
designate a Beneficiary or Beneficiaries to receive his vested Account balances
upon his death. The designation will be made on forms prescribed by the
Committee and will be effective upon receipt by the Committee. A Participant
will have the right to change or revoke any designation by filing a new
designation or notice of revocation with the Committee, but the revised
designation or revocation will be effective only upon receipt by the Committee.
7.2 Consent of Spouse Required. A Participant who is married may not
designate a Beneficiary other than, or in addition to, his spouse unless his
spouse consents to the designation by means of a written instrument that is
signed by the spouse, contains an acknowledgment by the spouse of the effect of
the consent, and is witnessed by a member of the Committee (other than the
Participant) or by a notary public. The designation will be effective only with
respect to the consenting spouse, whose consent will be irrevocable. A
Beneficiary designation to which a spouse has consented may not be changed by
the Participant without spousal consent (other than to designate the spouse as
Beneficiary), unless the spouse's consent expressly permits Beneficiary
designations by the Participant without any further consent of the spouse.
7.3 Failure to Designate Beneficiary. In the event a Participant has
not designated a Beneficiary, or in the event no Beneficiary survives a
Participant, the distribution of the Participant's vested Account balances upon
his death will be made (i) to the Participant's spouse, if living, (ii) if his
spouse is not then living, to his then living issue by right of representation,
(iii) if neither his spouse nor his issue are then living, to his then living
parents, and (iv) if none of the above are then living, to his estate.
7.4 Distributions to Beneficiaries.
(a) General Provisions. Distribution of a Participant's vested
Account balances to the Participant's Beneficiary will be made as soon as
practicable after the earlier of the Beneficiary's request for a distribution or
the required distribution date set forth in Section 7.4(b). The Participant's
vested Account balances will be distributed to the Beneficiary in a single lump
sum payment in the same form as provided for Participants in Section 6.1(b)(i),
or a Beneficiary may elect any optional form of distribution that was available
to the Participant under Section 6.1(b). The Participant's Account balances will
be valued as of the Valuation Date coinciding with or immediately preceding the
date the Accounts are to be distributed to his Beneficiary, except that there
will be added to the value of the Participant's Accounts the fair market value
of any amounts allocated to his Accounts under Article 4 after that Valuation
Date. If a loan is outstanding from the Trust Fund to the Participant on the
date of his death, the amount distributed to his Beneficiary will be reduced by
any security interest in the Participant's Accounts held by the Plan by reason
of the loan.
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(b) Required Distribution Dates.
(i) Spouse as Beneficiary. If the Participant dies before
distribution of his benefit begins and the designated Beneficiary is
the Participant's surviving spouse, distributions to the spouse must be
made or begin on or before December 31 of the calendar year in which
the Participant would have attained age 70 1/2. If, however, the
Participant dies in the calendar year in which he would have attained
age 70 1/2, or in any subsequent calendar year, distributions to the
spouse must be made or begin on or before December 31 of the calendar
year following the calendar year in which the Participant died. If the
spouse dies before distributions are made or begin, distributions will
be made to the spouse's Beneficiary in accordance with paragraph (ii)
below with the required distribution dates measured from the date of
the spouse's death. If the Participant dies after distributions begin
and the Participant was receiving an optional form of distribution
under Section 6.1(b)(ii) or (iii), the remaining portion of his
benefit, if any, will continue to be distributed in accordance with the
form of payment elected by the Participant.
(ii) Non-spouse Beneficiary. If the Participant dies before
distribution of his benefit begins and the designated Beneficiary is
other than the Participant's surviving spouse, distribution of the
Participant's entire benefit must be made no later than December 31 of
the fifth calendar year following the date of the Participant's death.
If, however, the Participant could have elected an optional form of
distribution under Section 6.1(b)(ii) or (iii) and the non-spouse
Beneficiary elects to receive distribution in such optional form,
distributions must begin on or before December 31 of the calendar year
immediately following the calendar year in which the Participant died.
If the Participant dies after distributions begin and the Participant
was receiving an optional form of distribution under Section 6.1(b)(ii)
or (iii), the remaining portion of his benefit, if any, will continue
to be distributed in accordance with the form of payment elected by the
Participant.
7.5 Restrictions on Distributions. Article 11 sets forth certain rules
under various provisions of the Code relating to restrictions on distributions
to Beneficiaries.
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ARTICLE 8
PROVISIONS REGARDING COMPANY STOCK
8.1 Powers and Duties of the Committee.
(a) Committee as Named Fiduciary. Except as otherwise provided in
this Section, the Committee will be the named fiduciary within the meaning of
ERISA section 402(a)(2) for purposes of all shareholder action authorized or
permitted to be taken with respect to Company Stock held in the Trust Fund. The
powers and duties of the Committee as named fiduciary for this purpose will
include, without limitation, the powers and duties to direct the Trustee with
respect to the voting of all shares of Company Stock; to direct the Trustee to
accept or reject a tender offer for shares of Company Stock; to direct the
Trustee to sell shares of Company Stock under any other circumstances to any
person, including the Company, provided that any sale to the Company or other
"disqualified person" within the meaning of Code section 4975 or "party in
interest" within the meaning of ERISA section 3(14) is made at a price which is
not less than adequate consideration as defined in ERISA section 3(18) and no
commission is charged with respect to the sale; and to exercise any options,
warrants or other rights in connection with shares of Company Stock held in the
Trust Fund. The Committee will also have the power, in its discretion, to permit
each Participant and Beneficiary to direct the Trustee to take or to refrain
from taking any action with respect to the shares of Company Stock allocated to
his Accounts that the Committee could have directed the Trustee to take or
refrain from taking. If the Committee permits Participants and Beneficiaries to
direct the Trustee in connection with any matter relating to Company Stock held
in the Trust Fund, each Participant and Beneficiary who furnishes instructions
to the Trustee will be a named fiduciary within the meaning of ERISA section
402(a)(2) with respect to such matter, but the Committee will retain the power
and duty to direct the Trustee with respect to shares of Company Stock allocated
to the Accounts of Participants and Beneficiaries who fail to furnish timely
instructions to the Trustee and with respect to any shares of Company Stock that
have not been allocated to Participants' Accounts. The Committee will adopt from
time to time whatever procedures it determines to be appropriate in order to
exercise its powers and duties under this subsection (a) and may retain advisors
and consultants (including, without limitation, legal counsel and financial
advisors) who are independent of the Company, the Board and the Trustee to the
extent the Committee determines such independent advice to be necessary or
appropriate.
(b) Delegation of Powers and Duties. The Committee may, in its
discretion, delegate any power or duty allocated to it pursuant to subsection
(a) above to another person or entity, who will act as an independent fiduciary
and will exercise such power or duty to the same extent as it could have been
exercised by the Committee. The persons or entities to which such powers and
duties may be delegated will include, without limitation, the Board or any
committee of the Board, the Trustee, any other person or entity that meets the
requirements of an investment manager under ERISA section 3(38), or any other
person or entity that the Committee determines in good faith has the requisite
knowledge and experience concerning the matter with respect to which the
delegation is made. The Committee may also remove any fiduciary to whom it has
delegated any power or duty and exercise such power or duty itself or appoint a
successor fiduciary. For purposes of Sections 8.2 and 8.3, the term "Committee"
will also mean
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any fiduciary to which the Committee has delegated any power or duty pursuant to
this subsection (b).
8.2 Voting Company Stock. Unless the Committee determines otherwise
pursuant to Section 8.1, voting rights with respect to shares of Company Stock
held in the Trust Fund will be exercised by Participants and Beneficiaries and
the procedures of this Section will apply. Before each annual or special meeting
of its shareholders, the Committee will cause to be sent to each Participant and
Beneficiary who has Company Stock allocated to his Accounts on the record date
of such meeting a copy of the proxy solicitation material for the meeting,
together with a form requesting confidential instructions to the Trustee on how
to vote the shares of Company Stock allocated to his Accounts. Upon receipt of
such instructions, the Trustee will vote the shares allocated to such
Participant's or Beneficiary's Accounts as instructed. The Trustee will vote
allocated shares of Company Stock for which it does not receive timely
instructions from Participants or Beneficiaries in accordance with the
Committee's instructions. A Participant's or Beneficiary's right to instruct the
Trustee with respect to voting shares of Company Stock will not include rights
concerning the exercise of any appraisal rights, dissenters' rights or similar
rights granted by applicable law to the registered or beneficial holders of
Company Stock. These matters will be exercised by the Trustee in accordance with
the Committee's instructions.
8.3 Tender Offer for Company Stock. Unless the Committee determines
otherwise pursuant to Section 8.1, the right to accept or reject a tender offer
for shares of Company Stock held in the Trust Fund will be exercised by
Participants and Beneficiaries and the procedures of this Section will apply. In
the event of a tender offer for shares of Company Stock subject to Section
14(d)(1) of the Securities Exchange Act of 1934 or subject to Rule 13e-4
promulgated under that Act (as those provisions may from time to time be amended
or replaced by successor provisions of federal securities laws), the Committee
will advise each Participant and Beneficiary who has shares of Company Stock
allocated to his Accounts in writing of the terms of the tender offer as soon as
practicable after its commencement and will furnish each Participant and
Beneficiary with a form by which he may instruct the Trustee confidentially to
tender shares allocated to his Accounts. The Trustee will tender those shares it
has been properly instructed to tender, and will not tender those shares which
it has been properly instructed not to tender. The Committee will also advise
Participants and Beneficiaries that the Committee will furnish instructions to
the Trustee with respect to allocated shares for which no instructions are
received from Participants and Beneficiaries and will furnish such related
documents as are prepared by any person and provided to the shareholders of the
Company pursuant to the Securities Exchange Act of 1934. The Committee may also
provide Participants with such other material concerning the tender offer as the
Committee in its discretion determines to be appropriate. The number of shares
to which a Participant's instructions apply will be the total number of shares
allocated to his Accounts as of the latest date for which Participant statements
were prepared. The Committee will advise the Trustee of the commencement date of
any tender offer and, until receipt of that advice, the Trustee will not be
obligated to take any action under this Section. Funds received in exchange for
tendered stock will be credited to the Accounts of the Participant or
Beneficiary whose stock was tendered and will be used by the Trustee to purchase
Company Stock, if available on a national securities exchange, commencing on the
earlier of the following dates: (a) the trading day following the first date on
which the closing price of the Company Stock on a national securities exchange
on which the Company Stock is then traded is within 20% of the closing price on
the tenth trading day preceding the
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commencement date of the tender offer or (b) the thirtieth trading day after the
expiration date of the tender offer, of which date the Committee will advise the
Trustee. In the interim, or if Company Stock is not available for purchase, the
Trustee will invest such funds in short term investments permitted under the
Trust Agreement.
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ARTICLE 9
ADMINISTRATION OF THE PLAN AND TRUST AGREEMENT
9.1 Appointment of Committee Members. The Board of Directors or the
Compensation Committee of the Board of Directors will appoint the Chairman of an
Administrative Committee, which will consist of three or more members. The
Chairman will appoint the remaining members of the Administrative Committee, who
will hold office at the pleasure of the Chairman. Members of the Committee are
not required to be Employees or Participants. Any member may resign by giving
notice, in writing, filed with the Board or the Chairman.
9.2 Officers and Employees of the Committee. The Committee will choose
a Secretary, who may be a member of the Committee. The Secretary will keep a
record of the Committee's proceedings and all dates, records and documents
pertaining to the Committee's administration of the Plan. The Committee may
employ and suitably compensate such persons or organizations to render advice
with respect to the duties of the Committee under the Plan as the Committee
determines to be necessary or desirable.
9.3 Action of the Committee. Action of the Committee may be taken with
or without a meeting of Committee members, provided that action will be taken
only upon the vote or other affirmative expression of a majority of the
Committee's members qualified to vote with respect to such action. The Chairman
of the Committee may execute any certificate or other written direction on
behalf of the Committee. In the event the Committee members qualified to vote on
any question are unable to determine such question by a majority vote or other
affirmative expression of a majority of the Committee members qualified to vote
on such question, such question will be determined by the Board. A member of the
Committee who is a Participant may not vote on any question relating
specifically to himself unless he is the sole member of the Committee.
9.4 Expenses and Compensation. The expenses of administering the Plan,
including without limitation the expenses of the Committee properly incurred in
the performance of its duties under the Plan, will be paid from the Trust Fund,
and all such expenses paid by the Participating Employers on behalf of the Plan
will be reimbursed from the Trust Fund unless the Participating Employers in
their discretion elect not to submit such expenses for reimbursement.
Notwithstanding the foregoing, the members of the Committee will not be
compensated by the Plan for their services as Committee members.
9.5 General Powers and Duties of the Committee. The Committee will have
the full power and responsibility to administer the Plan and the Trust Agreement
and to construe and apply their provisions. For purposes of ERISA, the Committee
will be the named fiduciary with respect to the operation and administration of
the Plan and the Trust Agreement. In addition, the Committee will have the
powers and duties granted by the terms of the Trust Agreement. The Committee,
and all other persons with discretionary control respecting the operation,
administration, control, and/or management of the Plan, the Trust Agreement,
and/or the Trust
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Fund, will perform their duties under the Plan and the Trust Agreement solely in
the interests of Participants and their Beneficiaries.
9.6 Specific Powers and Duties of the Committee. The Committee will
administer the Plan and the Trust Agreement and will have the authority and
discretion to (i) resolve all questions relating to the eligibility of Employees
to become Participants; (ii) determine the amount of benefits payable to
Participants or their Beneficiaries, and determine the time and manner in which
such benefits are to be paid; (iii) authorize and direct all disbursements by
the Trustee from the Trust Fund; (iv) engage any administrative, legal,
accounting, clerical, or other services it deems appropriate in administering
the Plan or the Trust Agreement; (v) construe and interpret the Plan and the
Trust Agreement, supply omissions from, correct deficiencies in, and resolve
ambiguities in the language of the Plan and the Trust Agreement, and adopt rules
for the administration of the Plan and the Trust Agreement which are not
inconsistent with the terms of such documents; (vi) compile and maintain all
records it determines to be necessary, appropriate or convenient in connection
with the administration of benefit payments; (vii) determine the disposition of
assets in the Trust Fund in the event the Plan is terminated; (viii) review the
performance of the Trustee with respect to the Trustee's administrative duties,
responsibilities and obligations under the Plan and the Trust Agreement, report
to the Board regarding such administrative performance of the Trustee, and
recommend to the Board, if necessary, the removal of the Trustee and the
appointment of a successor Trustee; and (ix) resolve all questions of fact
relating to any matter for which it has administrative responsibility.
9.7 Allocation of Fiduciary Responsibility. The Committee from time to
time may allocate to one or more of its members and may delegate to any other
persons or organizations any of its rights, powers, duties and responsibilities
with respect to the operation and administration of the Plan and the Trust
Agreement that are permitted to be delegated under ERISA. Any such allocation or
delegation will be made in writing, will be reviewed periodically by the
Committee, and will be terminable upon such notice as the Committee in its
discretion deems reasonable and proper under the circumstances. Whenever a
person or organization has the power and authority under the Plan or the Trust
Agreement to delegate discretionary authority respecting the administration of
the Plan or the Trust Fund to another person or organization, the delegating
party's responsibility with respect to such delegation is limited to the
selection of the person to whom authority is delegated and the periodic review
of such person's performance and compliance with applicable law and regulations.
Any breach of fiduciary responsibility by the person to whom authority has been
delegated which is not proximately caused by the delegating party's failure to
properly select or supervise, and in which breach the delegating party does not
otherwise participate, will not be considered a breach by the delegating party.
9.8 Information to be Submitted to the Committee. To enable the
Committee to perform its functions, the Participating Employers will supply full
and timely information to the Committee on all matters relating to Employees and
Participants as the Committee may require and will maintain such other records
required by the Committee to determine the benefits due to Participants or their
Beneficiaries under the Plan.
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9.9 Notices, Statements and Reports. The Company will be the
"administrator" of the Plan as defined in ERISA section 3(16)(A) for purposes of
the reporting and disclosure requirements imposed by ERISA and the Code. The
Committee will assist the Company, as requested, in complying with such
reporting and disclosure requirements.
9.10 Claims Procedure.
(a) Filing Claim for Benefits. If a Participant or Beneficiary
does not receive the benefits which he believes he is entitled to receive under
the Plan, he may file a claim for benefits with the Committee. All claims will
be made in writing and will be signed by the claimant. If the claimant does not
furnish sufficient information to determine the validity of the claim, the
Committee will indicate to the claimant any additional information which is
required.
(b) Notification by the Committee. Each claim will be approved or
disapproved by the Committee within 90 days following the receipt of the
information necessary to process the claim. In the event the Committee denies a
claim for benefits in whole or in part, the Committee will notify the claimant
in writing of the denial of the claim. Such notice by the Committee will also
set forth, in a manner calculated to be understood by the claimant, the specific
reason for such denial, the specific Plan provisions on which the denial is
based, a description of any additional material or information necessary to
perfect the claim with an explanation of why such material or information is
necessary, and an explanation of the Plan's claim review procedure as set forth
in subsection (c). If no action is taken by the Committee on a claim within 90
days, the claim will be deemed to be denied for purposes of the review
procedure.
(c) Review Procedure. A claimant may appeal a denial of his claim
by requesting a review of the decision by the Committee or a person designated
by the Committee, which person will be a named fiduciary under ERISA section
402(a)(2) for purposes of this Section. An appeal must be submitted in writing
within six months after the denial and must (i) request a review of the claim
for benefits under the Plan, (ii) set forth all of the grounds upon which the
claimant's request for review is based and any facts in support thereof, and
(iii) set forth any issues or comments which the claimant deems pertinent to the
appeal. The Committee or the named fiduciary designated by the Committee will
make a full and fair review of each appeal and any written materials submitted
in connection with the appeal. The Committee or the named fiduciary designated
by the Committee will act upon each appeal within 60 days after receipt thereof
unless special circumstances require an extension of the time for processing, in
which case a decision will be rendered as soon as possible but not later than
120 days after the appeal is received. The claimant will be given the
opportunity to review pertinent documents or materials upon submission of a
written request to the Committee or named fiduciary, provided the Committee or
named fiduciary finds the requested documents or materials are pertinent to the
appeal. On the basis of its review, the Committee or named fiduciary will make
an independent determination of the claimant's eligibility for benefits under
the Plan. The decision of the Committee or named fiduciary on any claim for
benefits will be final and conclusive upon all parties thereto. In the event the
Committee or named fiduciary denies an appeal in whole or in part, it will give
written notice of the decision to the claimant, which notice will set forth in a
manner calculated to be understood by the claimant the specific reasons for such
denial and
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which will make specific reference to the pertinent Plan provisions on which the
decision was based.
9.11 Service of Process. The Committee may from time to time designate
an agent of the Plan for the service of legal process. The Committee will cause
such agent to be identified in materials it distributes or causes to be
distributed when such identification is required under applicable law. In the
absence of such a designation, the Company will be the agent of the Plan for the
service of legal process.
9.12 Correction of Participants' Accounts. If an error or omission is
discovered in the Accounts of a Participant, or in the amount distributed to a
Participant, the Committee will make such equitable adjustments in the records
of the Plan as may be necessary or appropriate to correct such error or omission
as of the Plan Year in which such error or omission is discovered. Further, a
Participating Employer may, in its discretion, make a special contribution to
the Plan which will be allocated by the Committee only to the Account of one or
more Participants to correct such error or omission.
9.13 Payment to Minors or Other Persons Under Legal Disability. If any
benefit becomes payable to a minor, payment of such benefit will be made only to
the guardian of the person or the estate of the minor, provided the guardian
acknowledges in writing, in a form acceptable to the Committee, receipt of the
payment on behalf of the minor. If any benefit becomes payable to any other
person under a legal disability, payment of such benefit will be made only to
the conservator or the guardian of the estate of such person appointed by a
court of competent jurisdiction. Any payment made in accordance with the
provisions of this Section on behalf of a minor or other person under a legal
disability will fully discharge the Plan's obligation to such person.
9.14 Uniform Application of Rules and Policies. The Committee in
exercising its discretion granted under any of the provisions of the Plan or the
Trust Agreement will do so only in accordance with rules and policies
established by it which will be uniformly applicable to all Participants and
Beneficiaries.
9.15 Funding Policy. The Plan is to be funded through Participating
Employer contributions and earnings on such contributions; and benefits will be
paid to Participants and Beneficiaries as provided in the Plan.
9.16 The Trust Fund. The Trust Fund will be held by the Trustee for the
exclusive benefit of Participants and Beneficiaries. The assets held in the
Trust Fund will be invested and reinvested in accordance with the terms of the
Trust Agreement, which is hereby incorporated into and made a part of the Plan.
All benefits will be paid solely out of the Trust Fund, and no Participating
Employer will be otherwise liable for benefits payable under the Plan.
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ARTICLE 10
LIMITATIONS ON CONTRIBUTIONS AND
ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
10.1 Priority over Other Contribution and Allocation Provisions. The
provisions set forth in this Article will supersede any conflicting provisions
of Articles 3 and 4.
10.2 Definitions Used in this Article. The following words and phrases,
when used with initial capital letters, will have the meanings set forth below.
(a) "Annual Addition" means the sum of the following amounts with
respect to all Qualified Plans and Welfare Benefit Funds maintained by the
Controlled Group Members:
(i) the amount of Controlled Group Member contributions with
respect to the Limitation Year allocated to the Participant's account;
(ii) the amount of any forfeitures for the Limitation Year
allocated to the Participant's account;
(iii) the amount, if any, carried forward pursuant to
Section 10.4 or a similar provision in another Qualified Plan and
allocated to the Participant's account;
(iv) the amount of a Participant's voluntary nondeductible
contributions for the Limitation Year, provided, however, that the
Annual Addition for any Limitation Year beginning before January 1,
1987 will not be recomputed to treat all of the Participant's
nondeductible voluntary contributions as part of the Annual Addition;
(v) the amount allocated after March 31, 1984 to an
individual medical benefit account (as defined in Code section
415(l)(2)) which is part of a Defined Benefit Plan or an annuity plan;
and
(vi) the amount derived from contributions paid or accrued
after December 31, 1985 in taxable years ending after such date that
are attributable to post-retirement medical benefits allocated to the
separate account of a key employee (as defined in Code section
419A(d)(3)) under a Welfare Benefit Fund. A Participant's Annual
Addition will not include any nonvested amounts restored to his account
following his reemployment before incurring five consecutive One Year
Breaks in Service, and a corrective allocation pursuant to Section 9.12
will be considered an Annual Addition for the Limitation Year to which
it relates.
(b) "Average Contribution Percentage" means the average of the
Contribution Percentages of each Participant in a group of Participants.
(c) "Average Deferral Percentage" means the average of the
Deferral Percentages of each Participant in a group of Participants.
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<PAGE> 40
(d) "Contribution Percentage" means the ratio (expressed as a
percentage) determined by dividing the Matching Contributions made to the Plan
on behalf of a Participant who is eligible to receive an allocation of Matching
Contributions for a Plan Year (but only to the extent such Matching
Contributions are not taken into account in determining the Participant's
Deferral Percentage for the Plan Year) by the Participant's Compensation for the
Plan Year. A Participant is eligible to receive an allocation of Matching
Contributions for purposes of determining his Contribution Percentage even
though no Matching Contributions are made to the Plan on his behalf because of
the suspension of his Deferral Contributions under the terms of the Plan,
because of an election not to participate, or because of the limitations
contained in Sections 10.3 through 10.5 of the Plan.
(e) "Deferral Percentage" means the ratio (expressed as a
percentage) determined by dividing the Deferral Contributions made to the Plan
on behalf of a Participant who is eligible to make Deferral Contributions for
all or any portion of a Plan Year by the Participant's Compensation for the Plan
Year. In addition, if the Matching Contributions to the Plan for any Plan Year
satisfy the requirements of Code section 401(k)(2)(B) and (C), a Participant's
Deferral Percentage will be determined by aggregating the Deferral Contributions
and the Matching Contributions made to the Plan on his behalf for such Plan
Year, unless such aggregation is prohibited in regulations prescribed by the
Secretary of the Treasury. A Participant is eligible to make Deferral
Contributions for purposes of determining his Deferral Percentage even though he
does not make Deferral Contributions because of the suspension of his Deferral
Contributions under the terms of the Plan, because of an election not to
participate, or because of the limitations contained in Sections 10.3 through
10.5 of the Plan. A Deferral Contribution will be taken into account for a Plan
Year only if (i) the allocation of such contribution is not contingent on
participation in the Plan or the performance of services after the Plan Year,
(ii) such contribution is paid to the Trustee within 12 months after the end of
the Plan Year, and (iii) such contribution relates to Compensation that either
would have been received by the Participant in the Plan Year, or that is
attributable to services performed during the Plan Year and that would have been
received within two and one-half months after the Plan Year, but for the
election to defer.
(f) "Defined Benefit Dollar Limitation" means for any Limitation
Year, $90,000 or such amount as determined by the Commissioner of Internal
Revenue under Code section 415(d)(1) as of the January 1 falling within such
Limitation Year.
(g) "Defined Benefit Fraction" means a fraction, the numerator of
which is the Projected Annual Benefit of a Participant under all Defined Benefit
Plans maintained by a Controlled Group Member determined as of the close of the
Limitation Year and the denominator of which is the lesser of (i) 140% of the
Participant's average Includable Compensation that may be taken into account for
the Limitation Year under Code section 415(b)(1)(B), or (ii) 125% of the Defined
Benefit Dollar Limitation, determined as of the close of the Limitation Year. If
the Participant was a participant in a Defined Benefit Plan maintained by a
Controlled Group Member in existence on July 1, 1982, or on May 6, 1986, the
denominator of the Defined Benefit Fraction will not be less than 125% of the
greater of the Participant's accrued Projected Annual Benefit under such plan as
of the end of the last Limitation Year beginning before January 1, 1983, or his
accrued Projected Annual Benefit of the end of the last Limitation Year
beginning January 1, 1987. The preceding sentence applies
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only if the Defined Benefit Plan satisfied the requirements of Code section 415
as in effect at the end of such Limitation Year.
(h) "Defined Benefit Plan" means a Qualified Plan other than a
Defined Contribution Plan.
(i) "Defined Contribution Dollar Limitation" means, for any
Limitation Year $30,000 as adjusted pursuant to Code Section 415(d) for
Limitation Years beginning on or after January 1, 1995. If a short Limitation
Year is created because of a Plan amendment changing the Limitation Year to a
different 12-consecutive month period, the Defined Contribution Dollar
Limitation for the short Limitation Year will not exceed the amount determined
in the preceding sentences multiplied by a fraction, the numerator of which is
the number of months in the short Limitation Year and the denominator of which
is 12.
(j) "Defined Contribution Fraction" means a fraction, the
numerator of which is the sum of the Annual Additions allocated to the
Participant's accounts for the applicable Limitation Year and each prior
Limitation Year, and the denominator of which is the sum of the lesser of the
following products for each Limitation Year in which the Participant was an
Employee (regardless of whether a Defined Contribution Plan was in existence for
such Limitation Year) (i) the Defined Contribution Dollar Limitation (determined
for this purpose without regard to the provisions of Code section 415(c)(6))
effective for the Limitation Year multiplied by 125%, or (ii) 35% of the
Participant's Includable Compensation for such Limitation Year.
(k) "Defined Contribution Plan" means a Qualified Plan described
in Code section 414(i).
(l) "Family Member" means, with respect to an Employee, the
Employee's spouse and lineal ascendants or descendants and the spouses of such
lineal ascendants or descendants.
(m) "Highly Compensated Employee" means any Employee who performs
services for a Controlled Group Member during the determination year (as
hereinafter defined) and who during the look-back year (as hereinafter defined):
(i) received Compensation from a Controlled Group Member in excess of $75,000
(as adjusted pursuant to Code section 415(d)); (ii) received Compensation from a
Controlled Group Member in excess of $50,000 (as adjusted pursuant to Code
section 415(d)) and was a member of the top-paid group (as hereafter defined)
for such year; or (iii) was an officer of a Controlled Group Member and received
Compensation during such year that is greater than 50% of the dollar limitation
in effect under Code section 415(b)(1)(A) (but limited to no more than 50
Employees or, if lesser, the greater of three Employees or 10% of the
Employees). The term Highly Compensated Employee also includes: (i) an Employee
who is both described in the preceding sentence if the term "determination year"
is substituted for the term "look-back year" and the Employee is one of the 100
Employees who received the most Compensation from the Controlled Group during
the determination year; and (ii) an Employee who is a 5-percent owner at any
time during the look-back year or determination year. If no officer has
satisfied the Compensation requirement of (ii) above during either a
determination year or look-back year, the officer with the highest Compensation
for such
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<PAGE> 42
year will be treated as a Highly Compensated Employee. For purposes of this
subsection, the determination year is the Plan Year, and the look-back year is
the twelve-month period immediately preceding the determination year. A Highly
Compensated Employee also includes any Employee who separated from service (or
was deemed to have separated) prior to the determination year, performs no
services for a Controlled Group Member during the determination year, and was a
Highly Compensated Employee for either the separation year or any determination
year ending on or after the Employee's 55th birthday. The term "top-paid group"
means that group of Employees consisting of the top 20% of such Employees ranked
on the basis of Compensation received during the Plan Year. For purposes of this
subsection, Compensation will include Deferral Contributions under the Plan or
any other 401(k) arrangement and any amounts that would have been received as
cash but for an election to receive benefits under a Code section 125 cafeteria
plan. All determinations under this definition will be made in accordance with
Code section 414(q) and the Treasury Regulations thereunder.
For Plan Years beginning after December 31, 1996, the term
"Highly Compensated Employee" means an Employee who was a 5-percent owner of a
Controlled Group Member at any time during the Plan Year or who for the
preceding Plan Year had Compensation in excess of $80,000 (as adjusted pursuant
to Code Section 415(d)).
(n) "Includable Compensation" means an Employee's wages as
defined in Code section 3401(a) for purposes of income tax withholding at the
source (but determined without regard to any rules that limit the remuneration
included in wages based on the nature or location of the employment or services
performed) that are paid to a Participant by the Participating Employers. In
addition, effective for Plan Years beginning after December 31, 1997,
Compensation includes any contributions made by the Participating Employers on
behalf of an Employee pursuant to a deferral election under the Plan or under
any other employee benefit plan containing a cash or deferred arrangement under
Code section 401(k) and any amounts that would have been received as cash but
for an election to receive benefits under a cafeteria plan meeting the
requirements of Code section 125.
The annual Includable Compensation of an Employee taken
into account for any purpose for any Plan Year will not exceed $200,000 for any
Plan Year ending before January 1, 1994, as adjusted in regulations prescribed
by the Secretary of the Treasury, and will not exceed $150,000 for any Plan Year
beginning after December 31, 1993, as adjusted in regulations prescribed by the
Secretary of the Treasury. For purposes of applying the $200,000 and $150,000
limits set forth in the preceding sentence, if an Employee is a Highly
Compensated Employee who is either (i) a 5-percent owner, determined in
accordance with Code section 414(q) and the Treasury Regulations promulgated
thereunder or (ii) one of the 10 most highly compensated Employees ranked on the
basis of Compensation paid by the Controlled Group during the year, such Highly
Compensated Employee and the members of his family (as hereafter defined) will
be treated as a single employee and the Compensation of each member of the
family will be aggregated with the Compensation of the Highly Compensated
Employee. The limitation on Compensation will be allocated among such Highly
Compensated Employee and his family members in proportion to each individual's
Compensation. For purposes of this Section 10.2(n), the term "family" means an
Employee's spouse and any lineal descendants who are under age 19 at the end of
the Plan Year in question.
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(o) "Limitation Year" means the 12-consecutive-month period used
by a Qualified Plan for purposes of computing the limitations on benefits and
annual additions under Code section 415. The Limitation Year for this Plan is
the Plan Year.
(p) "Matching Contribution" means the Participating Employer
matching contribution made to the Plan on behalf of a Participant pursuant to
Article 3.
(q) "Maximum Annual Addition" means with respect to a Participant
for any Limitation Year an amount equal to the lesser of (i) the Defined
Contribution Dollar Limitation or (ii) 25% of the Participant's Includable
Compensation.
(r) "Nonhighly Compensated Employee" means an Employee who is
neither a Highly Compensated Employee nor, for Plan Years beginning before
January 1, 1997, a Family Member of a Highly Compensated Employee.
(s) "Projected Annual Benefit" means the annual benefit (as
defined in Code section 415(b)(2)) to which a Participant would be entitled
under the terms of a Defined Benefit Plan maintained by a Controlled Group
Member, assuming that the Participant will continue employment until his normal
retirement age under the Defined Benefit Plan (or current age, if later) and
that the Participant's Includable Compensation for the current Limitation Year
and all other relevant factors used to determine benefits under the Defined
Benefit Plan will remain constant for all future Limitation Years.
(t) "Welfare Benefit Fund" means an organization described in
paragraph (7), (9), (17) or (20) of Code section 501(c), a trust, corporation or
other organization not exempt from federal income tax, or to the extent provided
in Treasury Regulations, any account held for an employer by any person, which
is part of a plan of an employer through which the employer provides benefits to
employees or their beneficiaries, other than a benefit to which Code sections
83(h), 404 (determined without regard to section 404(b)(2)) or 404A applies, or
to which an election under Code section 463 applies.
(u) "Compensation" means the wages as defined in Code section
3401(a) for purposes of income tax withholding at the source (but determined
without regard to any rules that limit the remuneration included in wages based
on the nature or location of the employment or services performed) that are paid
to a Participant by the Participating Employers. In addition, Compensation
includes any contributions made by the Participating Employers on behalf of an
Employee pursuant to a deferral election under the Plan or under any other
employee benefit plan containing a cash or deferred arrangement under Code
section 401(k) and any amounts that would have been received as cash but for an
election to receive benefits under a cafeteria plan meeting the requirements of
Code section 125. The annual Compensation of an Employee taken into account for
any purpose will not exceed $200,000 for any Plan Year ending before January 1,
1994, as adjusted in regulations prescribed by the Secretary of the Treasury,
and will not exceed $150,000 for any Plan Year beginning after December 31,
1993, as adjusted in regulations prescribed by the Secretary of the Treasury.
For Plan Years beginning before January 1, 1997, for purposes of applying the
$200,000 and $150,000 limits set forth in the preceding sentence, if an Employee
is a Highly Compensated Employee who is either (i) a 5-percent owner, determined
in accordance with Code section 414(q) and the Treasury Regulations
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promulgated thereunder or (ii) one of the 10 most highly compensated employees
ranked on the basis of Compensation paid by the Controlled Group during the
year, such Highly Compensated Employee and the members of his family (as
hereafter defined) will be treated as a single employee and the Compensation of
each member of the family will be aggregated with the Compensation of the Highly
Compensated Employee. The limitation on Compensation will be allocated among
such Highly Compensated Employee and his family members in proportion to each
individual's Compensation. For purposes of this Section 10.2(u), the term
"family" means an Employee's spouse and any lineal descendants who are under age
19 at the end of the Plan Year in question.
10.3 General Allocation Limitation. The Annual Addition of a
Participant for any Limitation Year will not exceed the Maximum Annual Addition.
If, except for the application of this section, the Annual Addition of a
Participant for any Limitation Year would exceed the Maximum Annual Addition,
the excess Annual Addition attributable to this Plan will not be allocated to
the Participant's Account for the Plan Year included in such Limitation Year,
but will be subject to the provisions of Section 10.4. The limitations contained
in this Article will apply on an aggregate basis to all Defined Contribution
Plans and all Defined Benefit Plans (whether or not any of such plans have
terminated) established by the Controlled Group Members.
10.4 Excess Allocations.
(a) Participants Covered by One Defined Contribution Plan. If the
Participant is not covered under another Defined Contribution Plan or a Welfare
Benefit Fund maintained by a Controlled Group Member during the Limitation Year
and the amount allocated or otherwise allocable to his Account would exceed the
Maximum Annual Addition, the Participant's Deferral Contributions will be
returned to the Participant (together with earnings, if any, attributable to the
returned Deferral Contributions) to the extent necessary to reduce the excess
Annual Addition. If an excess Annual Addition remains after the return of such
Deferral Contributions plus earnings, the Participating Employer contributions
and forfeitures which would continue to cause the Participant's Annual Addition
to exceed the Maximum Annual Addition will be successively allocated in the
manner described in Section 4.2 among the Accounts of eligible Participants
whose Annual Additions do not exceed the Maximum Annual Addition. If, after such
allocations have been made, there remain Participating Employer contributions or
forfeitures which cannot be allocated without causing the Annual Addition of a
Participant to exceed the Maximum Annual Addition, the forfeitures which cause
the Annual Addition to exceed the Maximum Annual Addition and the Participating
Employer contributions which result from a reasonable error in estimating the
Participant's Includable Compensation or from any other limited facts and
circumstances which the Commissioner of Internal Revenue finds justifiable under
section 1.415-6(b)(6) of the Treasury Regulations and which cause the
Participant's Annual Addition to exceed the Maximum Annual Addition will be held
in a suspense account in the Trust Fund to be carried forward and used in
subsequent Limitation Years to reduce Participating Employer contributions to
the Plan. If a suspense account is in existence at any time during a Limitation
Year, all amounts in the suspense account must be allocated before any
contributions which would constitute Annual Additions will be made to the Plan
for that Limitation Year. Such suspense account will not participate in the
allocation of the net income or net loss of the Trust Fund.
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(b) Participants Covered by Two or More Defined Contribution
Plans. If, in addition to this Plan, the Participant is covered under another
Defined Contribution Plan or a Welfare Benefit Fund maintained by a Controlled
Group Member during the Limitation Year, the following provisions will apply.
The Annual Addition which may be credited to a Participant's Account under this
Plan for any such Limitation Year will not exceed the Maximum Annual Addition
reduced by the Annual Addition credited to a Participant's accounts under the
other Defined Contribution Plans and Welfare Benefit Funds for the same
Limitation Year. If the Annual Addition with respect to the Participant under
the other Defined Contribution Plans and Welfare Benefit Funds maintained by a
Controlled Group Member is less than the Maximum Annual Addition and the
Participating Employer contribution that would otherwise be contributed or
allocated to the Participant's Account under this Plan would cause the Annual
Addition for the Limitation Year to exceed the Maximum Annual Addition, the
amount to be contributed or allocated to the Participant's Account under this
Plan will be reduced so that the Annual Addition under all such Defined
Contribution Plans and Welfare Benefit Funds for the Limitation Year will equal
the Maximum Annual Addition. If the aggregate Annual Addition with respect to
the Participant under such other Defined Contribution Plans and Welfare Benefit
Funds is equal to or greater than the Maximum Annual Addition, no amount will be
contributed or allocated to the Participant's Account under this Plan for the
Limitation Year. An excess Annual Addition will be reduced in the manner
described in subsection (c).
(c) Reduction of Excess Allocations. As soon as is
administratively feasible after the end of the Limitation Year, the Maximum
Annual Addition for the Limitation Year will be determined on the basis of the
Participant's Includable Compensation for the Limitation Year. If a
Participant's Annual Addition under this Plan and the other Defined Contribution
Plans and Welfare Benefit Funds maintained by Controlled Group Members would
result in the Annual Addition exceeding the Maximum Annual Addition for the
Limitation Year, the excess amount will be deemed to consist of the Annual
Addition last allocated. In making this determination, the Annual Addition
attributable to a Welfare Benefit Fund will be deemed to have been allocated
first regardless of the actual date of allocation. If an excess amount was
allocated to a Participant on an allocation date of this Plan that coincides
with an allocation date of another plan, the excess amount attributed to this
Plan will be the product of (i) the total excess amount allocated as of such
date and (ii) the ratio of the Annual Addition allocated to the Participant for
the Limitation Year as of such date under this Plan to the total Annual Addition
allocated to the Participant for the Limitation Year as of such date under this
and all the other Defined Contribution Plans. Any excess amount attributed to
this Plan will be disposed of in the manner described in subsection (a).
10.5 Aggregate Benefit Limitation. The provisions of this Section will
apply only to Participants whose benefits begin to be distributed prior to
January 1, 2000. If a Controlled Group Member maintains, or at any time
maintained, one or more Defined Benefit Plans covering any Participant in this
Plan, the sum of the Defined Benefit Fraction and the Defined Contribution
Fraction for any Limitation Year will equal no more than one (1.0). The
provisions of the Defined Benefit Plans will govern the order of reduction of
Annual Additions or benefit accruals necessary to meet this limitation. If the
provisions of the Defined Benefit Plans are silent, the current Annual Addition
under this Plan will be reduced first, and then the rate of accrual under the
Defined Benefit Plans will be reduced, if necessary to meet this limitation. If
the Defined Contribution Plans taken into account in determining the
Participant's Annual
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Addition under this Article satisfied the requirements of Code section 415 as in
effect for all Limitation Years beginning before January 1, 1987, an amount will
be subtracted from the numerator of the Defined Contribution Fraction (not
exceeding such numerator) as prescribed by the Secretary of the Treasury so that
the sum of the Defined Contribution Fraction and the Defined Benefit Fraction
does not exceed 1.0. For purposes of this Section, a Participant's voluntary
nondeductible contributions to a Defined Benefit Plan will be treated as being
part of a separate Defined Contribution Plan.
10.6 Limitation on Deferral Contributions.
(a) Average Deferral Percentage Test. For Plan Years beginning
after December 31, 1996, and notwithstanding any other provision of the Plan,
the Average Deferral Percentage for a Plan Year for Participants who are Highly
Compensated Employees will not exceed the greater of: (i) the Average Deferral
Percentage for the preceding Plan Year of Participants who are Nonhighly
Compensated Employees multiplied by 1.25; or (ii) the lesser of (A) the Average
Deferral Percentage for the preceding Plan Year of Participants who are
Nonhighly Compensated Employees plus two percentage points or (B) the Average
Deferral Percentage for the preceding Plan Year of Participants who are
Nonhighly Compensated Employees multiplied by 2.0.
For Plan Years beginning before January 1, 1997, and
notwithstanding any other provision of the Plan, the Average Deferral Percentage
for a Plan Year for Participants who are Highly Compensated Employees will not
exceed the greater of: (i) the Average Deferral Percentage for Participants who
are Nonhighly Compensated Employees multiplied by 1.25; or (ii) the lesser of
(A) the Average Deferral Percentage for Participants who are Nonhighly
Compensated Employees plus two percentage points or (B) the Average Deferral
Percentage for Participants who are Nonhighly Compensated Employees multiplied
by 2.0.
The multiple use of the alternative test in clause (ii) of
each of the two preceding paragraphs will be restricted as provided in
regulations prescribed by the Secretary of the Treasury.
(b) Suspension of Deferral Contributions. If at any time during a
Plan Year the Committee determines, on the basis of estimates made from
information then available, that the limitation described in subsection (a)
above will not be met for the Plan Year, the Committee in its discretion may
reduce or suspend the Deferral Contributions of one or more Participants who are
Highly Compensated Employees to the extent necessary (i) to enable the Plan to
meet such limitation or (ii) to reduce the amount of excess Deferral
Contributions that would otherwise be distributed pursuant to subsection (c)
below.
(c) Reduction of Excess Deferral Contributions. If, for any Plan
Year beginning on or after January 1, 1997, the Average Deferral Percentage for
Participants who are Highly Compensated Employees exceeds the limitation
described in subsection (a) above, the dollar amount of excess Deferral
Contributions for each Highly Compensated Employee will be calculated in the
manner described in Code section 401(k)(8)(B) and the regulations thereunder,
and the aggregate dollar amount of the excess Deferral Contributions for all
Highly Compensated Employees will be distributed on the basis of the dollar
amount of Deferral
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Contributions for each such Participant (as hereinafter provided) until the
aggregate amount of excess Deferral Contributions has been distributed. The
Deferral Contributions of the Highly Compensated Employee with the highest
dollar amount of Deferral Contributions will be reduced first by the amount
required to cause that Participant's Deferral Contributions to equal the dollar
amount of the Deferral Contributions of the Highly Compensated Employee with the
next highest dollar amount, and this process will be repeated until the total
amount of excess Deferral Contributions has been distributed. Upon distribution
of the total excess Deferral Contributions in this manner, the Plan will be
treated as satisfying the limitations of subsection (a) above. Matching
Contributions made with respect to a Participant's excess Deferral Contributions
will be forfeited and applied as provided in Section 5.4.
If, for any Plan Year beginning before January 1, 1997, the
Average Deferral Percentage for Participants who are Highly Compensated
Employees exceeds the limitation described in subsection (a) above, the Deferral
Percentage for such Participants will be reduced by distributing the excess
Deferral Contributions to such Participants. Distribution of excess Deferral
Contributions will be made on the basis of the amount of Deferral Contributions
made by or on behalf of Participants who are Highly Compensated Employees,
beginning first with such Participants whose dollar amount of Deferral
Contributions is the highest, until the limitation in subsection (a) is
satisfied.
All distributions under this subsection will be increased
by Trust Fund earnings and decreased by Trust Fund losses for the Plan Year and
for the period between the end of the Plan Year and the date of distribution and
will be made within two and one-half months following the close of the Plan
Year, if practicable, but in no event later than the last day of the immediately
following Plan Year. The amount of excess Deferral Contributions distributed
pursuant to this Section with respect to a Participant for the Plan Year will be
reduced by any Deferral Contributions previously distributed to the Participant
for the same Plan Year pursuant to Section 3.1(c).
(d) Determination of Earnings and Losses. The earnings and losses
of the Trust Fund for the Plan Year allocable to the portion of a Participant's
Deferral Contributions that are distributed pursuant to subsection (c) above
will be determined by multiplying the Trust Fund earnings or losses for the Plan
Year allocable to the Participant's Deferral Contribution Account by a fraction,
the numerator of which is the amount of Deferral Contributions to be distributed
to the Participant and the denominator of which is the balance of the
Participant's Deferral Contribution Account on the last day of the Plan Year,
reduced by the earnings and increased by the losses allocable to such Account
for the Plan Year. The earnings and losses of the Trust Fund allocable to the
Participant's Deferral Contributions that are distributed pursuant to subsection
(c) for the period between the end of the Plan Year and the date of such
distribution will be determined in accordance with regulations prescribed by the
Secretary of the Treasury interpreting Code section 401(k).
(e) Discriminatory Matching Contributions. If the allocation of
Matching Contributions to a Participant's Matching Contribution Account results
in a discriminatory matching contribution (as determined under Code sections
401(a)(4) or 401(m) and the regulations thereunder) for such Participant because
the Matching Contribution relates to a Deferral Contribution that exceeds the
limitations described in Section 3.1(c) or this
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Section 10.6, or because of any other reason, and such discriminatory matching
contribution cannot be distributed as an excess Matching Contribution pursuant
to Section 10.7, such discriminatory matching contribution, or the portion
thereof that results in prohibited discrimination, will be forfeited
notwithstanding any other provision of the Plan to the contrary.
10.7 Limitation on Matching Contributions.
(a) Average Contribution Percentage Test. Notwithstanding any
other provision of the Plan, the Average Contribution Percentage for a Plan Year
for Participants who are Highly Compensated Employees will not exceed the
greater of: (i) the Average Contribution Percentage for the preceding Plan Year
of Participants who are Nonhighly Compensated Employees multiplied by 1.25; or
(ii) the lesser of (A) the Average Contribution Percentage for the preceding
Plan Year of Participants who are Nonhighly Compensated Employees plus two
percentage points or (B) the Average Contribution Percentage for the preceding
Plan Year of Participants who are Nonhighly Compensated Employees multiplied by
2.0.
For Plan Years beginning before January 1, 1997, and
notwithstanding any other provision of the Plan, the Average Contribution
Percentage for a Plan Year for Participants who are Highly Compensated Employees
will not exceed the greater of: (i) the Average Contribution Percentage for
Participants who are Nonhighly Compensated Employees multiplied by 1.25; or (ii)
the lesser of (A) the Average Contribution Percentage for Participants who are
Nonhighly Compensated Employees plus two percentage points or (B) the Average
Contribution Percentage for Participants who are Nonhighly Compensated Employees
multiplied by 2.0.
The multiple use of the alternative test contained in
clause (ii) of each of the preceding paragraphs will be restricted as provided
in regulations prescribed by the Secretary of the Treasury.
(b) Suspension of Matching Contributions. If at any time during a
Plan Year the Committee determines, on the basis of estimates made from
information then available, that the limitation described in subsection (a)
above will not be met for the Plan Year, the Committee in its discretion may
reduce or suspend the Matching Contributions of one or more Participants who are
Highly Compensated Employees to the extent necessary (i) to enable the Plan to
meet such limitation or (ii) to reduce the amount of Excess Matching
Contributions that would otherwise be forfeited or distributed pursuant to
subsection (c) below.
(c) Reduction of Excess Matching Contributions. If, for any Plan
Year beginning on or after January 1, 1997, the Average Contribution Percentage
for Participants who are Highly Compensated Employees exceeds the limitation
described in subsection (a) above, the dollar amount of excess Matching
Contributions for each Highly Compensated Employee will be calculated in the
manner described in Code section 401(m)(6)(B) and the regulations thereunder,
and the aggregate dollar amount of the excess Matching Contributions for all
Highly Compensated Employees will be forfeited (if forfeitable) or (if not
forfeitable) will be distributed on the basis of the dollar amount of Matching
Contributions for each such Participant (as hereinafter provided) until the
aggregate amount of excess Matching Contributions has been forfeited or
distributed. The Matching Contributions of the Highly Compensated Employee with
the highest dollar amount of Matching Contributions will be reduced first by the
amount required
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<PAGE> 49
to cause that Participant's Matching Contributions to equal the dollar amount of
the Matching Contributions of the Highly Compensated Employee with the next
highest dollar amount, and this process will be repeated until the total amount
of excess Matching Contributions has been forfeited or distributed. Upon
forfeiture or distribution of the total excess Matching Contributions in this
manner, the Plan will be treated as satisfying the limitations of subsection (a)
above.
If, for any Plan Year beginning before January 1, 1997, the
Average Contribution Percentage for Participants who are Highly Compensated
Employees exceeds the limitation described in subsection (a) above, the
Contribution Percentage for such Participants will be reduced by distributing
the excess Matching Contributions to such Participants. Distribution of excess
Matching Contributions will be made on the basis of the amount of Matching
Contributions made by or on behalf of Participants who are Highly Compensated
Employees, beginning first with such Participants whose dollar amount of
Matching Contributions is the highest, until the limitation in subsection (a) is
satisfied.
All distributions under this subsection will be increased
by Trust Fund earnings and decreased by Trust Fund losses for the Plan Year and
for the period between the end of the Plan Year and the date of distribution and
will be made within two and one-half months following the close of the Plan
Year, if practicable, but in no event later than the last day of the immediately
following Plan Year.
(d) Determination of Earnings and Losses. The earnings and losses
of the Trust Fund for the Plan Year allocable to the portion of a Participant's
Matching Contributions that are forfeited pursuant to Section 10.6 or
distributed pursuant to subsection (c) above will be determined by multiplying
the Trust Fund earnings or losses for the Plan Year allocable to the
Participant's Matching Contribution Account by a fraction, the numerator of
which is the amount of Matching Contributions to be distributed or forfeited and
the denominator of which is the balance of the Participant's Matching
Contribution Account on the last day of the Plan Year, reduced by the earnings
and increased by the losses allocable to such Account for the Plan Year. The
earnings and losses of the Trust Fund allocable to a Participant's Matching
Contributions that are forfeited pursuant to Section 10.6 or distributed
pursuant to subsection (c) above for the period between the end of the Plan Year
and the date of such distribution or forfeiture will be determined in accordance
with regulations prescribed by the Secretary of the Treasury interpreting Code
sections 401(k) and 401(m).
10.8 Aggregation Rules.
(a) Code Section 415. For purposes of the allocation limitations
under Code section 415 set forth in this Article, (i) all Defined Benefit Plans
ever maintained by a Controlled Group Member will be treated as one Defined
Benefit Plan, and all Defined Contribution Plans ever maintained by a Controlled
Group Member will be treated as one Defined Contribution Plan, and (ii)
Controlled Group Members will be determined in accordance with the 50% control
rule of Code section 415(h).
(b) Code Section 401(k). For purposes of the limitation on
Deferral Contributions set forth in this Article, the Average Deferral
Percentage for any Participant who is
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<PAGE> 50
a Highly Compensated Employee for the Plan Year and who is eligible to have
deferral contributions allocated to his account under two or more plans or
arrangements described in Code section 401(k) that are maintained by the Company
or any Controlled Group Member will be determined as if all such deferral
contributions were made under a single arrangement (unless such plans or
arrangements may not be permissively aggregated under applicable regulations).
Plans that are aggregated for purposes of satisfying the minimum coverage rules
of Code section 410(b) (other than for purposes of the average benefits
percentage test) will be treated as a single plan for such purposes.
(c) Code Section 401(m). The Contribution Percentage of a
Participant who is a Highly Compensated Employee for a Plan Year and who is
eligible to make voluntary Employee contributions or receive deferral
contributions or matching employer contributions allocated to his account under
two or more Defined Contribution Plans maintained by the Company or a Controlled
Group Member will be determined as if all such contributions were made to a
single plan (unless such plans may not be permissively aggregated under
applicable regulations). Plans that are aggregated for purposes of satisfying
the minimum coverage rules of Code section 410(b) (other than for purposes of
the average benefits percentage test) will be treated as a single plan for such
purposes.
(d) Family Members. For Plan Years beginning before January 1,
1997, for purposes of determining the Contribution Percentage or the Deferral
Percentage of a Participant who is both a Highly Compensated Employee and either
(i) a 5-percent owner, determined in accordance with Code section 414(q) and the
Treasury Regulations promulgated thereunder or (ii) one of the 10 most highly
compensated Employees ranked on the basis of Compensation paid by the Controlled
Group during the year, determined in accordance with Code section 414(q) and the
Treasury Regulations promulgated thereunder, the Matching Contributions,
Deferral Contributions, and Compensation of such Participant will include the
Matching Contributions, Deferral Contributions and Compensation of Family
Members, and Family Members will be disregarded in determining the Contribution
Percentage or the Deferral Percentage of Participants who are not such Highly
Compensated Employees.
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ARTICLE 11
RESTRICTIONS ON DISTRIBUTIONS TO
PARTICIPANTS AND BENEFICIARIES
11.1 Priority over Other Distribution Provisions. The provisions set
forth in this Article will supersede any conflicting provisions of Article 6 or
Article 7.
11.2 General Restrictions.
(a) Distributions Prior to a Separation from Service. Except for
distributions permitted under Article 6 with respect to Participants who attain
age 59 1/2 or suffer a hardship, a Participant's interest in the Plan will not
be distributed before the Participant's separation from service, disability or
death unless: (i) the Plan is terminated without the establishment or
maintenance by the Participating Employers of another defined contribution plan
(other than an employee stock ownership plan as defined in Code section
4975(e)(7)); (ii) a Participating Employer that is a corporation sells all or
substantially all of the assets used by the Participating Employer in a trade or
business to a person other than a Controlled Group Member and the Participant
becomes an employee of the acquiring employer; or (iii) a Participating Employer
that is a corporation disposes of its interest in a subsidiary to a person other
than an Controlled Group Member but only if the Participant continues employment
with the subsidiary. An event will not be treated as described in clause (ii) or
(iii) above unless the Participating Employer continues to maintain the Plan
after the disposition.
(b) Lump Sum Distribution Required. An event described in
subparagraph (a) that would otherwise permit distribution of a Participant's
interest in the Plan will not be treated as described in subparagraph (a) unless
the Participant receives a lump sum distribution by reason of the event. A lump
sum distribution for this purpose will be a distribution described in Code
section 402(d)(4), without regard to clauses (i), (ii), (iii), and (iv) of
subparagraph (A), subparagraph (B), or subparagraph (F) thereof.
11.3 Restrictions on Commencement of Distributions. The provisions of
this Section will apply to restrict the Committee's ability to delay the
commencement of distributions. Unless a Participant elects otherwise in writing,
distribution of the Participant's vested interest in his Account will begin no
later than the 60th day after the close of the Plan Year in which occurs the
latest of (i) the date on which the Participant attains age 62, (ii) the tenth
anniversary of the Plan Year in which the Participant began participation in the
Plan, or (iii) the Participant's termination of employment.
11.4 Restrictions on Delay of Distributions. This Section will apply to
distributions on or after January 1, 1998. Distribution of a Participant's
entire vested and nonforfeitable interest will be made or commence not later
than April 1 following (i) the calendar year in which he attains age 70 1/2, or
(ii) in which his employment with the Controlled Group terminates, if later,
except that a distribution to a Participant who is a 5-percent owner (as such
term is defined in Code section 416(i)(1)(B)(i)) with respect to the Plan Year
in which he attains age 70 1/2 will be made pursuant to clause (i).
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<PAGE> 52
11.5 Limitation to Assure Benefits Payable to Beneficiaries are
Incidental. In the event that any payments under the Plan are to be made to
someone other than the Participant or jointly to the Participant and his spouse
or other payee, such payments must conform to the "incidental benefit" rules of
Code section 401(a)(9)(G) and Treasury Regulation section 1.401(a)(9)-2.
11.6 Restrictions in the Event of Death. Upon the death of a
Participant, the following distribution provisions will apply to limit the
Beneficiary's ability to delay distributions. If the Participant dies after
distribution of his benefit has begun, the remaining portion of his benefit will
continue to be distributed at least as rapidly as under the method of
distribution being used prior to the Participant's death; but if he dies before
distribution of his benefit commences, his entire benefit will be distributed no
later than December 31 of the fifth calendar year following the date of the
Participant's death, unless an individual who is a designated Beneficiary elects
to receive distributions in substantially equal installments over the
Beneficiary's life or life expectancy beginning no later than December 31 of the
calendar year immediately following the calendar year in which the Participant
died. If the designated Beneficiary is the Participant's surviving spouse, the
date distributions are required to begin will not be earlier than December 31 of
the calendar year in which the Participant would have attained age 70 1/2, and,
if the spouse dies before payments begin, distributions will be made to the
spouse's Beneficiary in accordance with the preceding sentence with the required
distribution dates measured from the date of the spouse's death. Any amount paid
to a child of the Participant will be treated as if it had been paid to the
surviving spouse if the amount becomes payable to the surviving spouse when the
child reaches the age of majority.
11.7 Compliance with Regulations. Distributions under the Plan to
Participants or Beneficiaries will be made in accordance with Treasury
Regulations issued under Code section 401(a)(9).
11.8 Delayed Payments. If the amount of a distribution required to
begin on a date determined under the applicable provisions of the Plan cannot be
ascertained by such date, or if it is not possible to make such payment on such
date because the Committee has been unable to locate a Participant or
Beneficiary after making reasonable efforts to do so, a payment retroactive to
such date may be made no later than 60 days after the earliest date on which the
amount of such payment can be ascertained or the date on which the Participant
or Beneficiary is located (whichever is applicable).
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<PAGE> 53
ARTICLE 12
TOP-HEAVY PROVISIONS
12.1 Priority over Other Plan Provisions. If the Plan is or becomes a
Top-Heavy Plan in any Plan Year, the provisions of this Article will supersede
any conflicting provisions of the Plan. However, the provisions of this Article
will not operate to increase the rights or benefits of Participants under the
Plan except to the extent required by Code section 416 and other provisions of
law applicable to Top-Heavy Plans.
12.2 Definitions Used in this Article. The following words and phrases,
when used with initial capital letters, will have the meanings set forth below.
(a) "Defined Benefit Dollar Limitation" means the limitation
described in Section 10.2(f).
(b) "Defined Benefit Plan" means the Qualified Plan described in
Section 10.2(h).
(c) "Defined Contribution Dollar Limitation" means the limitation
described in Section 10.2(i).
(d) "Defined Contribution Plan" means the Qualified Plan
described in Section 10.2(k).
(e) "Determination Date" means for the first Plan Year of the
Plan the last day of the Plan Year and for any subsequent Plan Year the last day
of the preceding Plan Year.
(f) "Determination Period" means the Plan Year containing the
Determination Date and the four preceding Plan Years.
(g) "Includable Compensation" means the compensation described in
Section 10.2(n).
(h) "Key Employee" means any Employee or former Employee (and the
Beneficiary of a deceased Employee) who at any time during the Determination
Period was (i) an officer of a Controlled Group Member, if such individual's
Includable Compensation (modified as described below) exceeds 50% of the Defined
Benefit Dollar Limitation, (ii) an owner (or considered an owner under Code
section 318) of one of the ten largest interests in a Controlled Group Member,
if such individual's Includable Compensation exceeds the Defined Contribution
Dollar Limitation, (iii) a 5% owner of a Controlled Group Member, or (iv) a 1%
owner of a Controlled Group Member who has annual Includable Compensation of
more than $150,000. The determination of who is a Key Employee will be made in
accordance with Code section 416(i). For purposes of this subsection, Includable
Compensation will include the amount of any salary reduction contributions
pursuant to a cash or deferred arrangement meeting
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the requirements of Code section 401(k) or a cafeteria plan meeting the
requirements of Code section 125.
(i) "Minimum Allocation" means the allocation described in the
first sentence of Section 12.3(a).
(j) "Permissive Aggregation Group" means the Required Aggregation
Group of Qualified Plans plus any other Qualified Plan or Qualified Plans of a
Controlled Group Member which, when considered as a group with the Required
Aggregation Group, would continue to satisfy the requirements of Code sections
401(a)(4) and 410 (including simplified employee pension plans).
(k) "Present Value" means present value based only on the
interest and mortality rates specified in a Defined Benefit Plan.
(l) "Required Aggregation Group" means the group of plans
consisting of (i) each Qualified Plan (including simplified employee pension
plans) of a Controlled Group Member in which at least one Key Employee
participates, and (ii) any other Qualified Plan (including simplified employee
pension plans) of a Controlled Group Member which enables a Qualified Plan to
meet the requirements of Code sections 401(a)(4) or 410.
(m) "Top-Heavy Plan" means the Plan for any Plan Year in which
any of the following conditions exists: (i) if the Top-Heavy Ratio for the Plan
exceeds 60% and the Plan is not a part of any Required Aggregation Group or
Permissive Aggregation Group of Qualified Plans; (ii) if the Plan is a part of a
Required Aggregation Group but not part of a Permissive Aggregation Group of
Qualified Plans and the Top-Heavy Ratio for the Required Aggregation Group
exceeds 60%; or (iii) if the Plan is a part of a Required Aggregation Group and
part of a Permissive Aggregation Group of Qualified Plans and the Top-Heavy
Ratio for the Permissive Aggregation Group exceeds 60%.
(n) "Top-Heavy Ratio" means a fraction, the numerator of which is
the sum of the Present Value of accrued benefits and the account balances (as
required by Code section 416)) of all Key Employees with respect to such
Qualified Plans as of the Determination Date (including any part of any accrued
benefit or account balance distributed during the five-year period ending on the
Determination Date), and the denominator of which is the sum of the Present
Value of the accrued benefits and the account balances (including any part of
any accrued benefit or account balance distributed in the five-year period
ending on the Determination Date) of all Employees with respect to such
Qualified Plans as of the Determination Date. The value of account balances and
the Present Value of accrued benefits will be determined as of the most recent
Top-Heavy Valuation Date that falls within or ends with the 12-month period
ending on the Determination Date, except as provided in Code section 416 for the
first and second Plan Years of a Defined Benefit Plan. The account balances and
accrued benefits of a participant who is not a Key Employee but who was a Key
Employee in a prior year will be disregarded. The calculation of the Top-Heavy
Ratio, and the extent to which distributions, rollovers, transfers and
contributions unpaid as of the Determination Date are taken into account will be
made in accordance with Code section 416. Employee contributions described in
Code section 219(e)(2) will not be taken into account for purposes of computing
the
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<PAGE> 55
Top-Heavy Ratio. When aggregating plans, the value of account balances and
accrued benefits will be calculated with reference to the Determination Dates
that fall within the same calendar year. The accrued benefit of any Employee
other than a Key Employee will be determined under the method, if any, that
uniformly applies for accrual purposes under all Qualified Plans maintained by
all Controlled Group Members and included in a Required Aggregation Group or a
Permissive Aggregation Group or, if there is no such method, as if the benefit
accrued not more rapidly than the slowest accrual rate permitted under the
fractional accrual rate of Code section 411(b)(1)(C). Notwithstanding the
foregoing, the account balances and accrued benefits of any Employee who has not
performed services for an employer maintaining any of the aggregated plans
during the five-year period ending on the Determination Date will not be taken
into account for purposes of this subsection.
(o) "Top-Heavy Valuation Date" means the last day of each Plan
Year.
12.3 Minimum Allocation.
(a) Calculation of Minimum Allocation. For any Plan Year in which
the Plan is a Top-Heavy Plan, each Participant who is not a Key Employee will
receive an allocation of Participating Employer contributions and forfeitures of
not less than the lesser of 3% of his Includable Compensation for such Plan Year
or the percentage of Includable Compensation that equals the largest percentage
of Participating Employer contributions (including Deferral Contributions) and
forfeitures allocated to a Key Employee. The Minimum Allocation is determined
without regard to any Social Security contribution. Deferral Contributions made
on behalf of Participants who are not Key Employees will not be treated as
Participating Employer contributions for purposes of the Minimum Allocation.
Matching Contributions that are allocated to Participants who are not Key
Employees and that are taken into account in determining a Participant's
Deferral Percentage or Contribution Percentage will not be treated as
Participating Employer contributions for such Plan Year for purposes of the
Minimum Allocation. The Minimum Allocation applies even though under other Plan
provisions the Participant would not otherwise be entitled to receive an
allocation, or would have received a lesser allocation for the Plan Year because
(i) the non-Key Employee fails to make mandatory contributions to the Plan, (ii)
the non-Key Employee's Includable Compensation is less than a stated amount, or
(iii) the non-Key Employee fails to complete 1,000 Hours of Service in the Plan
Year.
(b) Limitation on Minimum Allocation. No Minimum Allocation will
be provided pursuant to subsection (a) to a Participant who is not employed by a
Controlled Group Member on the last day of the Plan Year.
(c) Minimum Allocation When Participant is Covered by Another
Qualified Plan. If a Controlled Group Member maintains one or more other Defined
Contribution Plans covering Employees who are Participants in this Plan, the
Minimum Allocation will be provided under this Plan, unless such other Defined
Contribution Plans make explicit reference to this Plan and provide that the
Minimum Allocation will not be provided under this Plan, in which case the
provisions of subsection (a) will not apply to any Participant covered under
such other Defined Contribution Plans. If a Controlled Group Member maintains
one or more Defined Benefit Plans covering Employees who are Participants in
this Plan, and such Defined Benefit
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<PAGE> 56
Plans provide that Employees who are participants therein will accrue the
minimum benefit applicable to top-heavy Defined Benefit Plans notwithstanding
their participation in this Plan, then the provisions of subsection (a) will not
apply to any Participant covered under such Defined Benefit Plans. If a
Controlled Group Member maintains one or more Defined Benefit Plans covering
Employees who are Participants in this Plan, and the provisions of the preceding
sentence do not apply, then each Participant who is not a Key Employee and who
is covered by such Defined Benefit Plans will receive a Minimum Allocation
determined by applying the provisions of subsection (a) with the substitution of
"5%" in each place that "3%" occurs therein.
(d) Nonforfeitability. The Participant's Minimum Allocation, to
the extent required to be nonforfeitable under Code section 416(b) and the
special vesting schedule provided in this Article, may not be forfeited under
Code section 411(a)(3)(B) (relating to suspension of benefits on reemployment)
or 411(a)(3)(D) (relating to withdrawal of mandatory contributions).
12.4 Modification of Aggregate Benefit Limit.
(a) Modification. Subject to the provisions of subsection (b), in
any Plan Year in which the Top-Heavy Ratio exceeds 60%, the aggregate benefit
limit described in Article 10 will be modified by substituting "100%" for "125%"
in Sections 10.2(g) and (j).
(b) Exception. The modification of the aggregate benefit limit
described in subsection (a) will not be required if the Top-Heavy Ratio does not
exceed 90% and one of the following conditions is met: (i) Employees who are not
Key Employees do not participate in both a Defined Benefit Plan and a Defined
Contribution Plan which are in the Required Aggregation Group, and the Minimum
Allocation requirements of Section 12.3(a) are met when such requirements are
applied with the substitution of "4%" for "3%"; (ii) the Minimum Allocation
requirements of Section 12.3(c) are met when such requirements are applied with
the substitution of "7 1/2%" for "5%"; or (iii) Employees who are not Key
Employees have an accrued benefit of not less than 3% of their average
Includable Compensation for the five consecutive Plan Years in which they had
the highest Includable Compensation multiplied by their Years of Service in
which the Plan is a Top-Heavy Plan (not to exceed a total such benefit of 30%),
expressed as a life annuity commencing at the Participant's normal retirement
age in a Defined Benefit Plan which is in the Required Aggregation Group.
12.5 Minimum Vesting.
(a) Required Vesting. For any Plan Year in which this Plan is a
Top-Heavy Plan, the minimum vesting schedule set forth in subsection (b) will
automatically apply to the Plan to the extent it provides a higher vested
percentage than the regular vesting schedule set forth in Article 5. The minimum
vesting schedule applies to all Account balances including amounts attributable
to Plan Years before the effective date of Code section 416 and amounts
attributable to Plan Years before the Plan became a Top-Heavy Plan. Further, no
reduction in vested Account balances may occur in the event the Plan's status as
a Top-Heavy Plan changes for any Plan Year, and any change in the effective
vesting schedule from the schedule set forth in subsection (b) to the regular
schedule set forth in Article 5 will be treated as an amendment subject to
Section 14.1(a)(iii). However, this subsection does not apply to the Account
balances
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<PAGE> 57
of any Employee who does not have an Hour of Service after the Plan has
initially become a Top-Heavy Plan, and such Employee's Account balances will be
determined without regard to this Section.
(b) Minimum Vesting Schedule.
<TABLE>
<CAPTION>
Percentage Vested
Years of Service and Nonforfeitable
---------------- ------------------
<S> <C>
Less than 2 0
2 but less than 3 20
3 but less than 4 40
4 but less than 5 60
5 but less than 6 80
6 or more 100
</TABLE>
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ARTICLE 13
ADOPTION OF PLAN BY CONTROLLED GROUP MEMBERS
13.1 Adoption Procedure. Any Controlled Group Member may become a
Participating Employer under the Plan provided that (i) the Board approves the
adoption of the Plan by the Controlled Group Member and designates the
Controlled Group Member as a Participating Employer; (ii) the Controlled Group
Member adopts the Plan and Trust Agreement together with all amendments then in
effect by appropriate resolutions of the board of directors of the Controlled
Group Member; and (iii) the Controlled Group Member by appropriate resolutions
of its board of directors agrees to be bound by any other terms and conditions
which may be required by the Board, provided that such terms and conditions are
not inconsistent with the purposes of the Plan.
13.2 Effect of Adoption by Controlled Group Member. A Controlled Group
Member that adopts the Plan pursuant to this Article will be deemed to be a
Participating Employer for all purposes hereunder, unless otherwise specified in
the resolutions of the Board designating the Controlled Group Member as a
Participating Employer. In addition, the Board may provide, in its discretion
and by appropriate resolutions, that the Employees of the Controlled Group
Member will receive credit for their employment with the Controlled Group Member
prior to the date it became a Controlled Group Member for purposes of
determining either or both the eligibility of such Employees to participate in
the Plan and the vested and nonforfeitable interest of such Employees in their
Account balances provided that such credit will be applied in a uniform and
nondiscriminatory manner with respect to all such Employees.
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ARTICLE 14
AMENDMENT OF THE PLAN
14.1 Right to Amend the Plan.
(a) In General. The Company reserves to the Compensation
Committee of the Board of Directors the right to amend the Plan at any time and
from time to time to the extent it may deem advisable or appropriate, provided
that (i) no amendment will increase the duties or liabilities of the Trustee
without its written consent; (ii) no amendment will cause a reversion of Plan
assets to the Participating Employers not otherwise permitted under the Plan;
(iii) no amendment will have the effect of reducing the percentage of the vested
and nonforfeitable interest of any Participant in his Account nor will the
vesting provisions of the Plan be amended unless each Participant with at least
three Years of Service (including Years of Service disregarded pursuant to the
reemployment provisions (if any) of Article 5) is permitted to elect to continue
to have the prior vesting provisions apply to him, within 60 days after the
latest of the date on which the amendment is adopted, the date on which the
amendment is effective, or the date on which the Participant is issued written
notice of the amendment; and (iv) no amendment will be effective to the extent
that it has the effect of decreasing a Participant's Account balance or
eliminating an optional form of distribution as it applies to an existing
Account balance.
(b) Authority of the Board. The Company also reserves to the
Board of Directors the right to amend the Plan at any time and from time to time
to the extent it may deem advisable or appropriate, subject to the limitations
on amendments set forth in subsection (a).
14.2 Amendment Procedure. Any amendment to the Plan will be made only
pursuant to action of the Board or of the Compensation Committee of the Board. A
certified copy of the resolutions adopting any amendment and a copy of the
executed amendment will be delivered to the Trustee, the Committee and the
Company. Upon such action by the Board or the Compensation Committee of the
Board, the Plan will be deemed amended as of the date specified as the effective
date by such action or in the instrument of amendment. The effective date of any
amendment may be before, on or after the date of such action, except as
otherwise set forth in Section 14.1.
14.3 Effect on Participating Employers. Unless an amendment expressly
provides otherwise, all Participating Employers will be bound by any amendment
to the Plan.
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ARTICLE 15
TERMINATION, PARTIAL TERMINATION AND
COMPLETE DISCONTINUANCE OF CONTRIBUTIONS
15.1 Continuance of Plan. The Participating Employers expect to
continue the Plan indefinitely, but they do not assume an individual or
collective contractual obligation to do so, and the right is reserved to the
Company, by action of the Board, to terminate the Plan or to completely
discontinue contributions thereto at any time. In addition, subject to remaining
provisions of this Article, any Participating Employer at any time may
discontinue its participation in the Plan with respect to its Employees.
15.2 Complete Vesting. If the Plan is terminated, or if there is a
complete discontinuance of contributions to the Plan by the Participating
Employers, the amounts allocated or to be allocated to the Accounts of all
affected Participants will become 100% vested and nonforfeitable without regard
to their Years of Service. For purposes of this Section, a Participant who has
terminated employment and is not again an Employee at the time the Plan is
terminated or there is a complete discontinuance of Participating Employer
contributions will not be an affected Participant entitled to full vesting if
the Participant had no vested interest in his Account balance attributable to
Participating Employer contributions at his termination of employment. In the
event of a partial termination of the Plan, the amounts allocable to the
Accounts of those Participants who cease to participate on account of the facts
and circumstances which result in the partial termination will become 100%
vested and nonforfeitable without regard to their Years of Service.
15.3 Disposition of the Trust Fund. If the Plan is terminated, or if
there is a complete discontinuance of contributions to the Plan, the Committee
will instruct the Trustee either (i) to continue to administer the Plan and pay
benefits in accordance with the Plan until the Trust Fund has been depleted, or
(ii) to distribute the assets remaining in the Trust Fund, unless distribution
is prohibited by Section 11.2. If the Trust Fund is to be distributed, the
Committee will make, after deducting estimated expenses for termination of the
Trust Fund and distribution of its assets, the allocations required under the
Plan as though the date of completion of the Trust Fund termination were a
Valuation Date. The Trustee will distribute to each Participant the amount
credited to his Account as of the date of completion of the Trust Fund
termination.
15.4 Withdrawal by A Participating Employer. A Participating Employer
may withdraw from participation in the Plan or completely discontinue
contributions to the Plan only with the approval of the Board. If any
Participating Employer withdraws from the Plan or completely discontinues
contributions to the Plan, a copy of the resolutions of the board of directors
of the Participating Employer adopting such action, certified by the secretary
of such board of directors and reflecting approval by the Board, will be
delivered to the Committee as soon as it is administratively feasible to do so,
and the Committee will communicate such action to the Trustee and to the
Employees of the Participating Employer.
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ARTICLE 16
MISCELLANEOUS
16.1 Reversion Prohibited.
(a) General Rule. Except as provided in subsections (b), (c) and
(d), it will be impossible for any part of the Trust Fund either (i) to be used
for or diverted to purposes other than those which are for the exclusive benefit
of Participants and their Beneficiaries (except for the payment of taxes and
administrative expenses), or (ii) to revert to a Controlled Group Member.
(b) Disallowed Contributions. Each contribution of the
Participating Employers under the Plan is expressly conditioned upon the
deductibility of the contribution under Code section 404. If all or part of a
Participating Employer's contribution is disallowed as a deduction under Code
section 404, such disallowed amount (reduced by any Trust Fund losses
attributable thereto) may be returned by the Trustee to the Participating
Employer with respect to which the deduction was disallowed (upon the direction
of the Committee) within one year after the disallowance.
(c) Mistaken Contributions. If a contribution is made by a
Participating Employer by reason of a mistake of fact, then so much of the
contribution as was made as a result of the mistake (reduced by any Trust Fund
losses attributable thereto) may be returned by the Trustee to the Participating
Employer (upon direction of the Committee) within one year after the mistaken
contribution was made.
(d) Failure to Qualify. In the event the Internal Revenue Service
determines that the Plan and the Trust Agreement, as amended by amendments
acceptable to the Company, initially fail to constitute a qualified plan and
establish a tax-exempt trust under the Code, then notwithstanding any other
provisions of the Plan or the Trust Agreement, the contributions made by the
Participating Employers prior to the date of such determination will be returned
to the Participating Employers within one year after such determination and the
Plan and Trust Agreement will terminate, but only if the application for
determination was made within the time prescribed by law for filing the
Company's income tax return for the taxable year in which the Plan and the Trust
Agreement were adopted, or such later date as the Secretary of the Treasury may
prescribe.
16.2 Bonding, Insurance and Indemnity.
(a) Bonding. To the extent required under ERISA, the
Participating Employers will obtain, pay for and keep current a bond or bonds
with respect to each Committee member and each Employee who receives, handles,
disburses, or otherwise exercises custody or control of, any of the assets of
the Plan.
(b) Insurance. The Participating Employers, in their discretion,
may obtain, pay for and keep current a policy or policies of insurance, insuring
the Committee members, the
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members of the board of directors of each Participating Employer and other
Employees to whom any fiduciary responsibility with respect to the
administration of the Plan has been delegated against any and all costs,
expenses and liabilities (including attorneys' fees) incurred by such persons as
a result of any act, or omission to act, in connection with the performance of
their duties, responsibilities and obligations under the Plan and any applicable
law.
(c) Indemnity. If the Participating Employers do not obtain, pay
for and keep current the type of insurance policy or policies referred to in
subsection (b), or if such insurance is provided but any of the parties referred
to in subsection (b) incur any costs or expenses which are not covered under
such policies, then the Participating Employers will indemnify and hold
harmless, to the extent permitted by law, such parties against any and all
costs, expenses and liabilities (including attorneys' fees) incurred by such
parties in performing their duties and responsibilities under this Plan,
provided that such party or parties were acting in good faith within what was
reasonably believed to have been the best interests of the Plan and its
Participants.
16.3 Merger, Consolidation or Transfer of Assets. There will be no
merger or consolidation of all or any part of the Plan with, or transfer of the
assets or liabilities of all or any part of the Plan to, any other Qualified
Plan unless each Participant who remains a Participant hereunder and each
Participant who becomes a participant in the other Qualified Plan would receive
a benefit immediately after the merger, consolidation or transfer (determined as
if the other Qualified Plan and the Plan were then terminated) which is equal to
or greater than the benefit they would have been entitled to receive under the
Plan immediately before the merger, consolidation or transfer if the Plan had
then terminated.
16.4 Spendthrift Clause. The rights of any Participant or Beneficiary
to and in any benefits under the Plan will not be subject to assignment or
alienation, and no Participant or Beneficiary will have the power to assign,
transfer or dispose of such rights, nor will any such rights to benefits be
subject to attachment, execution, garnishment, sequestration, the laws of
bankruptcy or any other legal or equitable process. This Section will not apply
to a "qualified domestic relations order." A "qualified domestic relations
order" means a judgment, decree or order made pursuant to a state domestic
relations law which satisfies the requirements of Code section 414(p). Payment
to an alternate payee pursuant to a qualified domestic relations order will be
made in an immediate lump sum payment, if the order so provides.
16.5 Rights of Participants. Participation in the Plan will not give
any Participant the right to be retained in the employ of a Controlled Group
Member or any right or interest in the Plan or the Trust Fund except as
expressly provided herein.
16.6 Electronic Media. Notwithstanding any provision of the Plan to the
contrary, including any provision which requires the use of a written
instrument, to the extent permitted by applicable law, the Committee may
establish procedures for the use of electronic media in communications and
transactions between the Plan or the Committee and Participants and
Beneficiaries. Electronic media may include, but are not limited to, electronic
mail, the Internet, intranet systems and automated telephonic response systems.
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16.7 Gender, Tense and Headings. Whenever any words are used herein in
the masculine gender, they will be construed as though they were also used in
the feminine gender in all cases where they would so apply. Whenever any words
used herein are in the singular form, they will be construed as though they were
also used in the plural form in all cases where they would so apply. Headings of
Articles, Sections and subsections as used herein are inserted solely for
convenience and reference and constitute no part of the Plan.
16.8 GOVERNING LAW. THE PLAN WILL BE CONSTRUED AND GOVERNED IN ALL
RESPECTS IN ACCORDANCE WITH APPLICABLE FEDERAL LAW AND, TO THE EXTENT NOT
PREEMPTED BY SUCH FEDERAL LAW, IN ACCORDANCE WITH THE LAWS OF THE STATE OF
TEXAS, INCLUDING WITHOUT LIMITATION, THE TEXAS STATUTE OF LIMITATIONS, BUT
WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAWS OF SUCH STATE.
Executed at Dallas, Texas, this 9th day of June, 2000.
A. H. BELO CORPORATION
By /s/ Marian Spitzberg
----------------------------------
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APPENDIX A
PARTICIPATING EMPLOYERS AS OF JULY 1, 2000
A. H. Belo Corporation
Belo Capital Bureau, Inc.
Belo Interactive, Inc.
Belo Kentucky, Inc.
Belo Management Services, Inc.
Bryan-College Station Eagle, Inc.
Colleyville News & Times, Inc.
The Dallas Morning News, L.P.
Denton Publishing Company
DFW Printing Company, Inc.
DFW Suburban Newspapers, Inc.
Henderson Gleaner, Inc.
KASW-TV, Inc.
KENS-TV, Inc.
KGW-TV, Inc.
KHOU-TV, L.P.
King Broadcasting Company
King News Corporation
KMOV-TV, Inc.
KMSB-TV, Inc.
KONG-TV, Inc.
KOTV, Inc.
KTVK, Inc.
KVUE Television, Inc.
Owensboro Messenger-Inquirer, Inc.
Press Enterprise Company
The Providence Journal Company
Rhode Island Monthly Communications, Inc.
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Rockwall Success, Inc.
Texas Cable News, Inc.
WCNC-TV, Inc.
WFAA-TV, L.P.
WVEC Television, Inc.
WWL-TV, Inc.
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