As filed with the Securities and Exchange Commission on February 9, 1996
Registration No. 333-00019
==============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
Post-Effective Amendment No. 1
to
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------
FORT HOWARD CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 39-1090992
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
--------------------
1919 South Broadway
Green Bay, Wisconsin 54304
(414) 435-8821
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
--------------------
FORT HOWARD CORPORATION
PROFIT SHARING RETIREMENT PLAN
HARMON ASSOC., CORP.
PROFIT SHARING RETIREMENT PLAN
(Full title of the Plans)
--------------------
JAMES W. NELLEN II
Vice President and Secretary
Fort Howard Corporation
1919 South Broadway
Green Bay, Wisconsin 54304
(414) 435-8821
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
--------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
==============================================================================
<S> <C> <C> <C> <C>
Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Number of Shares Offering Price Per Aggregate Registration
Securities to be Registered to be Registered(1) Share(2) Offering Price(2) Fee(2)
- -------------------------------------------------------------------------------------------------
Common Stock par value $.01
per Share.................. 350,000 $22.50 $7,875,000 $2,715.52
Plan Interests............... (3) (3) (3) (3)
=================================================================================================
(1) Pursuant to Rule 416 promulgated under the Securities Act of 1933, as amended (the
"Securities Act"), this Registration Statement covers, in addition to the number of shares
of Common Stock stated above, such additional shares of Common Stock to be offered or issued
to prevent dilution as a result of future stock dividends or stock splits.
(2) Registration fee previously paid upon filing of Registration Statement on January 2, 1996.
(3) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, as amended, this
Registration Statement also covers an indeterminate amount of interests to be offered or
sold pursuant to the employee benefit plans described herein. These securities have no
offering price and therefore, pursuant to Rule 457(h)(2) no separate registration fee is
required.
</TABLE>
EXPLANATORY NOTE
This Post-Effective Amendment No. 1 (the "Amendment") hereby amends the
Registrant's Registration Statement on Form S-8 (File No. 333-00019) (the
"Registration Statement") solely for the purpose of including the Harmon
Assoc., Corp. Profit Sharing Plan and the plan interests in connection
therewith as a plan through which shares of Fort Howard Corporation common
stock, par value $.01 per share, previously registered under the Registration
Statement may be sold. The contents of the Registration Statement are
incorporated herein by reference in their entirety.
ITEM 8. EXHIBITS.
Exhibit No. Description
*4.1 Profit Sharing Retirement Plan, (As Amended and
Restated as of January 1, 1985) conformed through
the Ninth Amendment.
*4.2 Plan Amendment No. 10 dated September 21, 1995.
*4.3 Plan Amendment No. 11 dated December 22, 1995.
*4.4 Fort Howard Profit Sharing Retirement Master Trust
effective January 1, 1996.
*4.5 Summary Plan Description.
+4.6 Harmon Assoc. Corp. Profit Sharing Plan.
+23 Consent of Arthur Andersen LLP.
*24 Powers of Attorney (included as part of signature
page.
The undersigned Registrant has submitted the Plans and
any amendments thereto to the Internal Revenue
Service in a timely manner and will make all changes
required by the IRS in order to maintain qualification
of the Plan.
------------
+ Filed herewith.
* Previously filed.
- 2 -
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this Post-
Effective Amendment No. 1 to Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Green Bay, State
of Wisconsin on the 9th day of February, 1996.
FORT HOWARD CORPORATION
By /s/James W. Nellen II
----------------------
James W. Nellen II
Vice President and Secretary
Pursuant to the requirements of the Securities Act of 1933, this Post-
Effective Amendment No. 1 to Registration Statement has been signed below by
the following persons in the capacities and on the dates indicated.
Signature Title Date
--------- ----- ----
* Director, Chairman of the Board February 9, 1996
- ---------------------- of Directors and Chief Executive
Donald H. DeMeuse Officer (principal executive officer)
* Director, Vice Chairman February 9, 1996
- ---------------------- and Chief Financial Officer
Kathleen J. Hempel (principal financial officer)
* Director, President and Chief February 9, 1996
- ---------------------- Operating Officer
Michael T. Riordan
* Director February 9, 1996
- ----------------------
Donald Patrick Brennan
* Director February 9, 1996
- ----------------------
Frank V. Sica
* Director February 9, 1996
- ----------------------
Robert H. Niehaus
* Director February 9, 1996
- ----------------------
David I. Margolis
* Director February 9, 1996
- ----------------------
Dudley J. Godfrey, Jr.
- 3 -
* Director February 9, 1996
- ----------------------
James L. Burke
/s/ Charles L. Szews Vice President and Controller February 9, 1996
- ---------------------- (principal accounting officer)
Charles L. Szews
*By:/s/ James W. Nellen II February 9, 1996
- --------------------------
James W. Nellen II
Attorney-In-Fact
Pursuant to the requirements of the Securities Act of 1933, the trustees
(or other persons who administer the Plan) have duly caused this Post-
Effective Amendment No. 1 to Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Green Bay, State
of Wisconsin, on the 9th day of February, 1996.
FORT HOWARD CORPORATION PROFIT
SHARING RETIREMENT PLAN
Investment Advisory Board
/s/ R. Michael Lempke
------------------------------
By: R. Michael Lempke
Member
Pursuant to the requirements of the Securities Act of 1933, the trustees
(or other persons who administer the Plan) have duly caused this Post-
Effective Amendment No. 1 to Registration Statement to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of Green Bay, State
of Wisconsin, on the 9th day of February, 1996.
HARMON ASSOC. CORP.
PROFIT SHARING PLAN
Investment Advisory Board
/s/ R. Michael Lempke
------------------------------
By: R. Michael Lempke
Member
- 4 -
INDEX TO EXHIBITS
Exhibit No. Description
*4.1 Profit Sharing Retirement Plan, (As Amended and
Restated as of January 1, 1985) conformed through
the Ninth Amendment.
*4.2 Plan Amendment No. 10 dated September 21, 1995.
*4.3 Plan Amendment No. 11 dated December 22, 1995.
*4.4 Fort Howard Profit Sharing Retirement Master Trust
effective January 1, 1996.
*4.5 Summary Plan Description.
+4.6 Harmon Assoc. Corp. Profit Sharing Plan.
+23 Consent of Arthur Andersen LLP.
*24 Powers of Attorney (included as part of signature
page.
The undersigned Registrant has submitted the Plans and
any amendments thereto to the Internal Revenue
Service in a timely manner and will make all changes
required by the IRS in order to maintain qualification
of the Plan.
------------
+ Filed herewith.
* Previously filed.
Exhibit 4.6
HARMON ASSOC., CORP.
PROFIT SHARING PLAN
(Amended and Restated Effective as of January 1, 1995)
TABLE OF CONTENTS
Article PAGE
I NAME AND PURPOSES 1
II DEFINITIONS 2
III ELIGIBILITY AND PARTICIPATION 20
IV TRUST FUND AND CONTRIBUTIONS 22
V PARTICIPANT DEFERRED WAGE CONTRIBUTIONS 24
VI ALLOCATIONS TO PARTICIPANTS' ACCOUNTS 29
VII VESTING 32
VIII PAYMENT OF BENEFITS 34
IX SURVIVOR ANNUITY REQUIREMENTS 44
X TOP-HEAVY PLAN RULES 49
XI INVESTMENT ADVISORY BOARD 53
XII MERGER OF COMPANY, MERGER OF PLAN 57
XIII TERMINATION AND DISCONTINUANCE OF CONTRIBUTIONS 58
XIV APPLICATION FOR BENEFITS 59
XV LIMITATIONS ON CONTRIBUTIONS 61
XVI RESTRICTION ON ALIENATION 66
XVII AMENDMENTS 69
XVIII MISCELLANEOUS MATTERS 70
ARTICLE I
NAME AND PURPOSES
1.1 Name and Purposes.
(a) The plan provided hereunder shall be known as the Harmon
Assoc., Corp. Profit Sharing Plan ("Plan").
(b) The Plan is the result of the merger of the Harmon Assoc.,
Corp. Profit Sharing Plan and the Harco Trucking Corp. Profit Sharing
Plan, which became effective December 31, 1989.
(c) The Plan, which is intended to constitute a tax qualified
profit sharing plan that contains a cash or deferred arrangement under
Code Section 401(k), shall be maintained and administered for the
exclusive benefit of Participants and their Beneficiaries.
ARTICLE II
DEFINITIONS
Whenever capitalized in the text, the following terms shall have the
meaning set forth below.
2.1 Account. "Account" or "Accounts" shall mean the Company Contribution
Account, the Deferred Wage Contribution Account (if applicable), the
Voluntary Contribution Account (if applicable), the Rollover Contribution
Account (if applicable), and the Pension Plan Transfer Account (if
applicable) maintained for each Participant.
2.2 Affiliated Company. "Affiliated Company" shall mean:
(a) Any corporation that is included in a controlled group of
corporations, within the meaning of Section 414(b) of the Code, of which
group the Company is also a member;
(b) Any trade or business that is under common control with the
Company within the meaning of Section 414(c) of the Code; and
(c) Any service organization that is included in an affiliated
service group, within the meaning of Section 414(m) of the Code, of which
affiliated service group the Company is also a member.
For purposes of applying the limitations of Article XV, whether or not an
entity is an Affiliated Company shall be determined by applying the
percentage modifications contained in Code Section 415(h).
2.3 Aggregation Group.
(a) "Aggregation Group" means--
(i) Each plan of the Company or an Affiliated Company in
which a Key Employee is or was a Participant during the Testing
Period (regardless of whether the plan has been terminated), and
(ii) Each other plan of the Company or an Affiliated
Company which enables any plan described in Subparagraph (i) to meet
the requirements of Code Sections 401(a)(4) or 410.
(b) Any plan not required to be included in an Aggregation Group
under the rules of Paragraph (a) may be treated as being part of the
group if the group would continue to meet the requirements of Code
Sections 401(a)(4) and 410 with the plan being taken into account.
(c) Each plan maintained by the Company or an Affiliated Company
required to be included in an Aggregation Group shall be treated as a
Top-Heavy Plan if the Aggregation Group is a Top-Heavy Group.
2.4 Annual Additions.
(a) "Annual Additions" shall include, for any Limitation Year--
(i) The amount credited to a Participant's Accounts from
Company Contributions (including Deferred Wage Contributions and
Fail-Safe Contributions), plus
(ii) The Participant's Voluntary Contributions,
(iii) Forfeitures, and
(iv) Any amounts allocated to an account established under
a funded welfare benefit plan or a defined benefit plan to provide
medical benefits with respect to the Participant after retirement.
(b) The following amounts shall not be considered part of the
Participant's Annual Additions:
(i) Rollover Contributions;
(ii) Repayments of loans; and
(iii) Any recontributions (of prior distributions) made
pursuant to Section 8.8.
2.5 Average Deferral Percentage.
(a) The "Average Deferral Percentage" for the Highly Compensated
Employees and for all other Covered Employees is the average of the
ratios, calculated separately for each Employee in the group, of the
amount of his Deferred Wage Contributions (including any Fail-Safe
Contributions made on his behalf) to the amount of his Compensation.
(i) In the case of an Employee who does not defer
anything under the Plan, his deferral percentage shall be zero
percent (0%).
(ii) The Average Deferral Percentage for each group shall
be calculated to the nearest one-hundredth percent of compensation.
(iii) The computation of the Average Deferral Percentage in
the case of Family Members shall be done in accordance with the
regulations under Code Section 401(k).
(b) If the Plan is treated as a single plan for purposes of
satisfying the requirements of Code Sections 401(a)(4) and 410 along with
another plan that contains a cash or deferred arrangement, all of the
cash or deferred arrangements shall be treated as a single arrangement.
(c) If a Highly Compensated Employee is also a participant in one
or more other cash or deferred arrangements maintained by the Company,
all such arrangements shall be treated as a single arrangement.
(d) For purposes of this Section 2.5, a Participant's Compensation
shall be determined in accordance with the rules of Code Section 414(s).
For Plan Years beginning after December 31, 1989, a Participant's
Compensation shall be the amount he receives during the entire Plan Year,
regardless of whether or not he was a Participant for the entire Plan
Year.
2.6 Beneficiary. "Beneficiary" shall mean the person designated in
Article VIII to receive the Vested Interest of a deceased Participant.
2.7 Board of Directors. "Board of Directors" or "Board" shall mean the Board
of Directors of the Company.
2.8 Break in Service.
(a) "Break in Service" shall mean a Computation Period in which the
Employee does not complete more than five hundred (500) Hours of Service.
In the event of a Plan Year of less than twelve (12) months, the five
hundred (500) hour requirement shall be reduced by multiplying it by a
fraction--
(i) The numerator of which is the number of months in
that Plan Year (rounded to the nearest month), and
(ii) The denominator of which is twelve (12).
(b) An Employee described in Paragraph (c) below shall be credited
with the Hours of Service calculated in accordance with Paragraphs (d)
and (e) below.
(c) The provisions of Paragraphs (d) and (e) shall apply with
respect to an Employee who is absent from work without pay for any
period--
(i) By reason of the pregnancy of the Employee,
(ii) By reason of the birth of a child of the Employee,
(iii) By reason of the placement of a child with the
Employee in connection with the adoption of the child by the
Employee, or
(iv) For purposes of caring for the child for a period
beginning immediately following the birth or placement.
(d) The number of Hours of Service to which an Employee described
in Paragraph (c) shall be credited with shall be--
(i) The number which otherwise would normally have been
credited to the Employee but for the absence, or
(ii) If the number described in Subparagraph (i) above is
not capable of being determined, eight (8) Hours of Service per day
of the absence.
However, the total number of hours treated as Hours of Service under this
Paragraph (d) shall not exceed five hundred one (501). Furthermore,
these Hours of Service shall be taken into account solely for the purpose
of determining whether or not the Employee has incurred a Break in
Service.
(e) The Hours described in Paragraph (d) shall be credited to the
Computation Period--
(i) In which the absence from work begins, if the
Employee would be prevented from incurring a Break in Service in
that Computation Period solely because the period of absence is
treated as Hours of Service under this Section 2.8, or
(ii) In any other case, in the immediately following
Computation Period.
(f) The above provisions of this Section 2.8 shall not apply unless
the Employee provides such timely information as the Investment Advisory
Board may reasonably require to establish that--
(i) The absence is for reasons described in
Paragraph (c), and
(ii) The number of days for which there was an absence.
2.9 Code. "Code" shall mean the Internal Revenue Code of 1986.
2.10 Company. "Company" shall mean Harmon Assoc., Corp., Harco Trucking
Corp., and any Affiliated Companies of either corporation (or similar
entities) which may be included within the coverage of the Plan with the
consent of the Board of Directors.
2.11 Company Contributions. "Company Contributions" shall mean all amounts
paid by the Company into the Trust Fund. Except where the context
indicates to the contrary, Company Contributions shall not include
Deferred Wage Contributions and Fail-Safe Contributions.
2.12 Company Contribution Account. The "Company Contribution Account" of a
Participant shall mean his individual account in the Trust Fund in which
are held his allocated share of Company Contributions, Forfeitures, and
the earnings thereon.
2.13 Compensation.
(a) A Participant's "Compensation" shall mean the total
compensation paid to the participant for services rendered to the Company
during a calendar year, including overtime, holiday pay, sick days,
salary continuation, vacation pay, goodwill and discretionary bonuses,
and sales incentive compensation, but excluding short-term disability
benefits and all special or unusual compensation of any kind.
(b) Except as otherwise expressly provided in this Plan to the
contrary, the term "Compensation" shall include those amounts which
represent Deferred Wage Contributions.
(c) For Plan Years beginning after December 31,1993, in no event
will the amount of Compensation taken into account on behalf of any
Participant exceed one hundred fifty thousand dollars ($150,000), as
adjusted from time to time by the Secretary of Treasury pursuant to
Code Section 401(a)(17) and the regulations thereunder.
2.14 Computation Period.
(a) "Computation Period" is the relevant twelve (12) consecutive
month period for determining whether the Employee is to be credited with
a Year of Service or a Break in Service.
(b) For purposes of determining eligibility to participate, an
Employee's initial Computation Period shall be the twelve (12)
consecutive month period which begins on the Employee's Employment
Commencement Date.
(i) The Employee's second Computation Period shall be the
Plan Year that includes the first anniversary of his Employment
Commencement Date.
(ii) The third and all subsequent Computation Periods
shall also be the Plan Year.
(c) For purposes of determining vesting, each Employee's
Computation Period shall be the Plan Year.
2.15 Covered Employees. "Covered Employees" means those Employees who have
satisfied all of the requirements for eligibility to participate in the
Plan and are not otherwise precluded from participating in the Plan.
2.16 Deferred Wage Contributions. "Deferred Wage Contributions" shall mean
the pretax contributions made by Participants pursuant to an election
made under the provisions of Article V.
2.17 Deferred Wage Contribution Account. "Deferred Wage Contribution Account"
of a Participant shall mean his individual account in the Trust Fund in
which are held his Deferred Wage Contributions, any Fail-Safe
Contributions made on his behalf, and the earnings thereon.
2.18 Determination Date. "Determination Date" means, with respect to any Plan
Year, the last day of the preceding Plan Year. In the case of the first
Plan Year, "Determination Date" shall mean the last day of that Plan
Year.
2.19 Disability.
(a) An individual is disabled if he is unable to engage in any
substantial gainful activity by reason of any medically determinable
physical or mental impairment that can be expected to result in death or
that has lasted or can be expected to last for a continuous period of not
less than twelve (12) months.
(b) No Participant shall be deemed to have incurred a Disability as
a result of an injury or illness incurred as a result of:
(i) The commission of a felony;
(ii) Intentionally self-inflicted injury; or
(iii) Alcoholism or substance abuse.
2.20 Effective Date. The original "Effective Date" of the Plan was
January 1, 1971. Except as otherwise noted herein, the Effective Date of
this restatement of the Plan is January 1, 1995.
2.21 Employee. "Employee" shall mean each person qualifying as a common law
employee of the Company or an Affiliated Company.
2.22 Employment Commencement Date.
(a) The term "Employment Commencement Date" shall mean the date on
which an Employee first performs an Hour of Service.
(b) Unless the Company shall expressly determine otherwise, and
except as is expressly provided otherwise in this Plan, an Employee shall
not, for purposes of determining his Employment Commencement Date, be
deemed to have commenced employment with an Affiliated Company prior to
the effective date on which the entity became an Affiliated Company
within the meaning of Section 2.2.
2.23 Entry Date. "Entry Date" shall mean the first day on which an Employee
who has satisfied the participation eligibility requirements of
Section 3.1 shall commence participation in this Plan.
2.24 ERISA. "ERISA" shall mean the Employee Retirement Income Security Act of
1974.
2.25 Fail-Safe Contributions. "Fail-Safe Contributions" shall mean those
Company Contributions made pursuant to Section 5.7 that are designed to
insure compliance with the Average Deferral Percentage Tests of
Section 5.3.
2.26 Family Member. If any individual is a member of the family of a Five
Percent Owner or of a Highly Compensated Employee in the group consisting
of the ten (10) Highly Compensated Employees paid the greatest
compensation during the year, then for purposes of applying the various
nondiscrimination rules applicable to this Plan--
(a) The individual ("Family Member") shall not be considered a
separate Employee, and
(b) Any compensation paid to the Family Member (and any applicable
contribution or benefit on behalf of the Family Member) shall be treated
as if it were paid to (or on behalf of) the Five Percent Owner or Highly
Compensated Employee.
For purposes of this Section 2.26, "family" means the Employee's Spouse,
lineal ascendants and descendants, and the spouses of the lineal
ascendants and descendants.
2.27 Five Percent Owner.
(a) "Five Percent Owner" means any person who owns (or is
considered as owning within the meaning of Code Section 318) more than
five percent (5%) of the--
(i) Outstanding stock of the Company or an Affiliated
Company, or
(ii) The total combined voting power of all stock of the
Company or an Affiliated Company.
(b) The rules of Subsections (b), (c), and (m) of Code Section 414
shall not apply for purposes of applying these ownership rules. Thus,
this ownership test shall be applied separately with respect to the
Company and every Affiliated Company.
(c) The constructive ownership rules of Code Section 318(a)(2)(C)
shall be applied by substituting "five percent (5%)" for "fifty percent
(50%)" where it appears therein.
(d) For purposes of this Section 2.27, if an Employee's ownership
interest varies during a Plan Year, his ownership interest shall be the
largest interest owned at any time during the year.
2.28 Forfeiture. "Forfeiture" means the nonvested portion of a Participant's
Company Contribution Account that is forfeited as of the earlier of (i)
the date of the distribution of his Vested Interest or (ii) the date on
which he incurs five (5) consecutive Breaks in Service.
2.29 Highly Compensated Employee.
(a) "Highly Compensated Employee" means any Employee who, during
the year or the preceding year--
(i) Was at any time a Five Percent Owner,
(ii) Received compensation from the Company and all
Affiliated Companies in excess of seventy-five thousand dollars
($75,000), as indexed for inflation,
(iii) Received compensation from the Company and all
Affiliated Companies in excess of fifty thousand dollars ($50,000),
as indexed for inflation, and was in the top twenty percent (20%) of
all Employees when ranked on the basis of compensation paid during
the year ("Top-Paid Group"). For this purpose, all of an Employee's
Compensation shall be taken into account, even though some of it may
exceed two hundred thousand dollars ($200,000), or
(iv) Was at any time an Officer of the Company or any
Affiliated Company.
(b) In the case of the year for which the relevant determination is
being made, an Employee described in Subparagraphs (ii), (iii), or (iv)
of Paragraph (a) above shall not be treated as described therein unless
the Employee is a member of the group consisting of the one hundred (100)
Employees paid the greatest compensation during the year for which the
determination is being made.
(c) For purposes of this Section 2.29, the amount of an Employee's
compensation shall be determined in accordance with Code
Section 414(q)(7), which includes his Deferred Wage Contributions and
his pre-tax contributions to a cafeteria plan under Code Section 125.
(d) For purposes of determining the number of Employees in the
Top-Paid Group (described in Paragraph (a)(iii) above), the following
Employees shall be excluded--
(i) Employees who have not completed six (6) months of
service,
(ii) Employees who normally work less than seventeen and
one-half (17-1/2) hours per week,
(iii) Employees who normally work during not more than
six (6) months during any year,
(iv) Employees who have not attained age
twenty-one (21),
(v) Except to the extent provided in regulations,
Employees who are included in a unit of Employees covered by an
agreement which the Secretary of Labor finds to be a collective
bargaining agreement between Employee representatives and the
Company, and
(vi) Employees who are nonresident aliens and who
receive no earned income (within the meaning of Section 911(d)(2)
of the Code) from the Company and all Affiliated Companies which
constitutes income from sources within the United States (within the
meaning of Section 861(a)(3) of the Code).
(f) A former Employee shall be treated as a Highly Compensated
Employee if--
(i) He was a Highly Compensated Employee when he
separated from service, or
(ii) He was a Highly Compensated Employee at any time
after attaining age fifty-five (55).
2.30 Hour of Service.
(a) "Hour of Service" of an Employee shall mean each hour for which
he is paid or is entitled to payment by the Company or an Affiliated
Company:
(i) For the performance of services as an Employee;
(ii) Which is attributable to a period of time during
which he performs no duties (irrespective of whether or not his
employment has been terminated) due to a vacation, holiday, illness,
incapacity (including pregnancy or Disability), layoff, jury duty,
military duty, or a leave of absence.
(A) However, no such hours shall be credited to
an Employee if the Employee is directly or indirectly paid
or entitled to payment for the hours and the payment or
entitlement--
(I) Is made or due under a plan
maintained solely for the purpose of complying
with applicable worker's compensation,
unemployment compensation, disability insurance
laws, or
(II) Is a payment which solely
reimburses the Employee for his medical or
medically-related expenses; or
(iii) For which he is entitled to back pay, irrespective
of mitigation of damages, whether awarded or agreed to by the
Company or an Affiliated Company, provided that he has not
previously been credited with an Hour of Service with respect to
that hour under Subparagraph (i) or (ii) above.
Notwithstanding the foregoing, no Employee shall be entitled to credit
for more than five hundred and one (501) Hours of Service for any single
continuous period during which he performs no duties, whether or not the
period occurs in a single Computation Period.
(b) All Hours of Service determined under the rules of Paragraph
(a) shall be credited to the Computation Period in which the payment is
actually made, determined in accordance with rules prescribed by the
Investment Advisory Board. The provisions of this Paragraph (b) shall be
applied in a manner consistent with the provisions of Department of Labor
Regulation Section 2530.200b-2.
(c) Unless the Investment Advisory Board shall expressly determine
otherwise, and except as may be expressly provided otherwise in this
Plan, an Employee shall not receive credit for his Hours of Service
completed with an Affiliated Company prior to the effective date on which
the entity became an Affiliated Company.
(d) Notwithstanding the above rules, the Investment Advisory Board
may specify the use of one or more equivalencies specified below.
However, in the event that different equivalencies are used for different
classifications of Employees, the manner in which they are applied must
not discriminate in favor of Highly Compensated Employees, and the
equivalencies must be applied on a uniform basis to the Employees in each
class. The permitted equivalencies are as follows:
(i) Ten (10) Hours of Service for each day during which
the Employee completes at least one (1) Hour of Service;
(ii) Forty-five (45) Hours of Service for each week
during which the Employee completes at least one (1) Hour of
Service;
(iii) Ninety-five Hours of Service for each semi-monthly
payroll period during which the Employee completes at least one (1)
Hour of Service; and
(iv) One hundred ninety (190) Hours of Service for each
month during which the Employee completes at least one (1) Hour of
Service.
2.31 Investment Advisory Board. "Investment Advisory Board" means the
Fort Howard Corporation Investment Advisory Board appointed by the Chief
Executive Officer of Fort Howard Corporation and consisting of such
number of persons as determined by the Chief Executive Officer of
Fort Howard Corporation.
2.32 Key Employee. "Key Employee" shall mean any Employee or former Employee
who, at any time during the Testing Period, is or was:
(a) An Officer of the Company or an Affiliated Company;
(b) One of the ten (10) Employees--
(i) Having annual compensation from the Company or an
Affiliated Company of more than the limitation in effect under
Section 15.1(a)(i) below, and
(ii) Owning (or considered as owning within the meaning
of Code Section 318) during the Testing Period both more than
one-half percent (1/2%) interest and the largest interests in the
Company or an Affiliated Company.
For purposes of this Paragraph (b), if two (2) Employees have the
same interest in the Company or an Affiliated Company, the Employee
having the greater annual compensation from the Company or an
Affiliated Company shall be treated as having the larger interest;
(c) A Five Percent Owner of the Company or an Affiliated Company;
or
(d) A One Percent Owner of the Company or an Affiliated Company
having an annual compensation from the Company of more than one hundred
fifty thousand dollars ($150,000).
The term "Key Employee" shall include his Beneficiaries. Also, for this
purpose, an Employee's Compensation shall be the amount indicated on the
Form W-2 issued to him for the calendar year ending with or within the
Plan Year.
2.33 Leave of Absence. "Leave of Absence" shall mean any unpaid personal
leave from active employment duly authorized by the Company under the
Company's standard personnel practices. All persons under similar
circumstances shall be treated in a uniform and nondiscriminatory manner
in the granting of Leaves of Absence.
(a) An Employee shall not be deemed to have incurred a Break in
Service while on a Leave of Absence, provided he returns to employment on
or before the date on which the leave expires.
(b) In the event an Employee does not return to employment on or
before the end of the leave, he shall be deemed to have incurred a
Severance as of the first day of the leave, unless the failure was due to
his death or disability or the provisions of Section 2.8 apply.
2.34 Limitation Year. In connection with the adoption of this Plan, the
Company hereby elects a "Limitation Year" corresponding to the Plan Year
for purposes of the limitations on contributions set forth in Article XV.
2.35 Normal Retirement Age. "Normal Retirement Age" shall mean the later of--
(a) The Participant's sixty-fifth (65th) birthday, or
(b) The fifth (5th) anniversary of the date on which the individual
commenced participation in the Plan.
For this purpose, participation will be deemed to have commenced upon the
first day of the first Plan Year in which the Employee's participation in
the Plan commenced, except that years that may be disregarded under
Section 2.58 shall not be taken into account for this purpose.
2.36 Officer.
(a) "Officer" shall mean any Employee who was at any time an
officer of the Company or an Affiliated Company and received compensation
from the Company and all Affiliated Companies greater than fifty percent
(50%) of the amount in effect under Code Section 415(b)(1)(A) for the
year.
(b) However, no more than the lesser of--
(i) Fifty (50) Employees, or
(ii) The greater of three (3) Employees or ten percent
(10%) of the Employees, shall be treated as Officers.
(c) If no officer is described in the Paragraphs (a) and (b) above,
then the highest paid officer of the Company shall be treated as being
described therein.
(d) For purposes of Paragraph (b) above, all Leased Employees
(within the meaning of Section 414(n) of the Code) and all part-time
Employees shall be taken into account, and the number of Employees shall
be the greatest number at any time during the relevant period.
2.37 One Percent Owner. "One Percent Owner" means any person who would be a
Five Percent Owner if the threshold test were "one percent (1%)" instead
of five percent (5%)."
2.38 Participant.
(a) "Participant" shall mean any Employee who has satisfied the
participation eligibility requirements and has been enrolled in this Plan
in accordance with the provisions of Article III.
(b) "Participant" does not include an Employee who has incurred a
Severance and either (i) does not have a Vested Interest or (ii) has been
paid the full amount of his Vested Interest.
2.39 Pension Plan Transfer Account. "Pension Plan Transfer Account" of a
Participant shall mean his individual account in the Trust Fund in which
is held his interest transferred from the Harmon Assoc., Corp. Pension
Plan and the earnings thereon.
2.40 Plan. "Plan" shall mean the Harmon Assoc., Corp. Profit Sharing Plan.
2.41 Plan Administrator. "Plan Administrator" shall mean the administrator of
the Plan within the meaning of Section 3(16)(A) of ERISA, which shall be
the Fort Howard Corporation Investment Advisory Board.
2.42 Plan Year. "Plan Year" shall mean the twelve (12) month period ending on
December 31.
2.43 Reemployment Commencement Date. In the case of an Employee who incurs a
Severance and who is subsequently reemployed by the Company or an
Affiliated Company, the term "Reemployment Commencement Date" shall mean
the first day following the Severance on which the Employee performs an
Hour of Service.
2.44 Rollover Contribution. "Rollover Contribution" means a contribution made
by an Employee pursuant to Section 5.8.
2.45 Rollover Contribution Account. The "Rollover Contribution Account" of an
Employee shall mean his individual account in the Trust Fund in which are
held his Rollover Contributions and the earnings thereon.
2.46 Severance. "Severance" shall mean the termination of an Employee's
employment with the Company or an Affiliated Company, by reason of his
retirement, death, resignation, dismissal, or otherwise.
2.47 Spouse. "Spouse" shall mean the person to whom a Participant is married
as of the relevant date.
2.48 Surviving Spouse. "Surviving Spouse" shall mean a Spouse who is alive as
of the date of the Participant's death.
2.49 Testing Period. "Testing Period" means the Plan Year containing the
Determination Date and the preceding four (4) Plan Years.
2.50 Top-Heavy Group. "Top-Heavy Group" means any Aggregation Group if the
sum (as of the Determination Date) of--
(a) The present value of the cumulative accrued benefits for Key
Employees under all defined benefit plans included in the group, and
(b) The aggregate of the account balances of Key Employees under
all defined contribution plans included in the group, exceeds
sixty percent (60%) of a similar sum determined for all Employees.
2.51 Top-Heavy Plan.
(a) The term "Top-Heavy Plan" means, with respect to any Plan Year:
(i) Any defined benefit plan if, as of the Determination
Date, the present value of the cumulative accrued benefits under the
plan for Key Employees exceeds sixty percent (60%) of the present
value of the cumulative accrued benefits under the plan for all
Employees.
(A) For purposes of this Paragraph (a), the
present value of an Employee's accrued benefit shall be
determined by using the interest rate and the mortality
assumptions specified in that plan. The same actuarial
assumptions shall be used in measuring accrued benefits
under all plans.
(B) The accrued benefit of any Employee (other
than a Key Employee) shall be determined--
(I) Under the method that is used for
benefit accrual purposes for all plans of the
Company and all Affiliated Companies, or
(II) If there is no such method, as
if the benefit accrued no more rapidly than the
slowest accrual rate permitted under Code
Section 411(b)(1)(C).
(C) The date on which the accrued benefit of
each Employee is measured (with respect to each
Determination Date) shall be the date used for computing
costs under the minimum funding standards of Code
Section 412, determined as if he had terminated service as
of that date; and
(ii) Any defined contribution plan if, as of the
Determination Date, the aggregate amount of the account balances of
Key Employees under the plan exceeds sixty percent (60%) of the
present value of the aggregate of the account balances of all
Employees under the plan.
(A) The date on which the account balance of
each Employee is measured (with respect to each
Determination Date) shall be the last day of the relevant
plan year.
(b) For purposes of this Section 2.51, the accrued benefit and
account balances of a Participant shall include amounts attributable to
Participant contributions (whether or not the contributions are
includible in income).
(c) The same date shall be used for valuing benefits under all
plans.
2.52 Trust and Trust Fund. "Trust" or "Trust Fund" shall mean the Trust
created by this Agreement.
2.53 Trustee. "Trustee" shall mean the Mellon Bank, which is the Trustee of
the Fort Howard Profit Sharing Retirement Master Trust, which is part of
this Plan.
2.54 Valuation Date. "Valuation Date" shall mean the last day of each Plan
Year, or such other date or dates as may be selected by the Investment
Advisory Board for valuing the assets of the Plan.
2.55 Vested Interest. "Vested Interest" shall mean the interest of a
Participant in the Trust Fund which has become vested pursuant to the
provisions of Article VII.
2.56 Voluntary Contributions. "Voluntary Contributions" shall mean the
after-tax contributions made to the Plan by Participants prior to
January 1, 1991.
2.57 Voluntary Contribution Account. "Voluntary Contribution Account" of a
Participant shall mean his individual account in the Trust Fund in which
are held his after-tax contributions made to the Plan prior to January 1,
1991, and the earnings thereon.
2.58 Year of Service.
(a) "Year of Service" shall mean a Computation Period during which
the Employee completes at least one thousand (1,000) Hours of Service.
In the event of a Plan Year of less than twelve (12) months, the one
thousand (1,000) hour requirement shall be reduced by multiplying it by a
fraction--
(i) The numerator of which is the number of months in
that Plan Year (rounded to the nearest month), and
(ii) The denominator of which is twelve (12).
(b) In no event will an Employee be credited with more than one (1)
Year of Service with respect to service performed in a single Computation
Period.
(c) In the case of an Employee who does not have any Vested
Interest, his Years of Service before a period of consecutive Breaks in
Service will not be taken into account under the Plan if the number of
his consecutive Breaks in Service equals or exceeds the greater of
(i) five (5) or (ii) the aggregate number of his Years of Service. In no
event, however, will an Employee's Years of Service be disregarded under
the rule in the previous sentence if he has made any Deferred Wage
Contributions.
ARTICLE III
ELIGIBILITY AND PARTICIPATION
3.1 Eligibility to Participate.
(a) Every Employee of the Company who has both attained age
twenty-one (21) and completed one (1) Year of Service shall become
eligible to participate in the Plan.
(b) The date on which the Employee shall commence participation
shall be the January 1 or July 1 which first occurs following
satisfaction of both of the eligibility conditions.
(c) Notwithstanding the above, the following classes of Employees
shall not be eligible to participate in the Plan:
(i) Employees who are included in a unit of Employees
covered by a collective bargaining agreement, if there is evidence
that retirement benefits were the subject of good faith bargaining
between the Employee representatives and the Company, unless the
collective bargaining agreement expressly provides for coverage
under this Plan; and
(ii) Leased Employees within the meaning of
Section 414(n) of the Code.
3.2 Special Participation Rules.
(a) In the case of an Employee whose Entry Date occurs after the
Employee incurred a Severance, the Employee shall commence participation
in this Plan as of the later of (i) his Entry Date, or (ii) his
Reemployment Commencement Date following the Severance, unless his prior
service is disregarded under the rules of Section 2.58.
(b) A Participant who incurs a Severance and is thereafter
reemployed by the Company shall be entitled to recommence participation
in the Plan as of his Reemployment Commencement Date following the
Severance, unless his prior service is disregarded under the rules of
Section 2.58.
3.3 Duration of Participation. Each Employee who has commenced participation
in the Plan in accordance with the provisions of Section 3.1 shall
continue to be a Participant until he has incurred a Severance.
3.4 Participation Beyond Normal Retirement Age. Participants who have
attained their Normal Retirement Age will continue to participate in the
Plan to the same extent as those Participants who have not yet attained
their Normal Retirement Age.
ARTICLE IV
TRUST FUND AND CONTRIBUTIONS
4.1 Trust Fund. Pursuant to the terms of the Plan, the Company established a
trust, with the Trustee as the trustee thereunder. The Trustee has
agreed to hold and administer in trust all amounts accumulated under the
Plan under the terms of this Plan.
4.2 Company Contribution.
(a) The Company shall contribute to the Trust Fund (i) an amount
equal to the Participant Deferred Wage Contributions under Article V, and
(ii) an additional amount determined by the Board of Directors in its
discretion.
(b) In no event shall the amount of the contribution by the Company
under this Plan (including Deferred Wage Contributions) exceed the
maximum allowable deduction available to the Company for its fiscal year
under Section 404 of the Code.
(c) No contribution shall be made by the Company at any time when
its allocation would be precluded by the limitations of Article XV.
(d) All contributions by the Company under this Plan may be made in
kind or in cash, or in both, and shall be made directly to the Trustee on
any date or dates selected by the Company.
(e) All contributions by the Company for a Plan Year shall be made
within the time prescribed by law for filing the Company's federal income
tax return (including extensions) for the Company's taxable year
corresponding to the Plan Year.
4.3 Irrevocability. In no event shall any of the assets of the Plan revert
to the Company except as provided in this Section 4.3.
(a) In the case of a Company Contribution which is made by reason
of a mistake of fact, at the Company's election, the contribution shall
be returned to the Company within one (1) year after it is made.
(b) All Company Contributions to the Plan are hereby conditioned on
their deductibility under Code Section 404. In the event the deduction
for a contribution is disallowed, the contribution shall be returned to
the Company within one (1) year of the disallowance.
(c) In the case where amounts are held in a Suspense Account under
Article XV that may not be allocated to the Accounts of Participants when
the Plan is terminated, the excess amounts may revert to the Company in
accordance with the regulations under Code Section 415.
(d) In the case of a Participant's excess Deferred Wage
Contributions to the Plan, notwithstanding any other provision of this
Plan, the amount of the excess Deferred Wage Contributions may be treated
in accordance with the rules of Article V.
4.4 Investment of Contributions. Contributions made to the Plan by or on
behalf of a Participant shall be invested in such investment fund or
funds, or any of them, and in such amounts as determined by the
Investment Advisory Board in its sole discretion. The Investment
Advisory Board may also permit the Participant to direct the manner in
which the Participant's Account balances are to be invested in part or in
whole in accordance with such uniform and nondiscriminatory rules and
procedures as the Investment Advisory Board may adopt for such purposes.
4.5 Investment Manager. The Investment Advisory Board may appoint one or
more investment managers to have the unlimited or limited authority and
power to manage, acquire or dispose of the assets in any investment fund.
Each investment manager shall be registered as an investment advisor
under the Investment Advisors Act of 1940, a bank as defined in that Act,
or an insurance company qualified to perform such services under the laws
of more than one state, and shall acknowledge in writing to be a
fiduciary with respect to the Plan and the Trust.
ARTICLE V
PARTICIPANT DEFERRED WAGE CONTRIBUTIONS
5.1 Deferred Wage Contributions.
(a) Pursuant to such rules and procedures as the Investment
Advisory Board may prescribe, each Participant may elect to defer the
receipt of a portion of his Compensation and to have that amount
contributed directly by the Company to the Plan on his behalf.
(b) The Investment Advisory Board shall prescribe such rules as it
deems necessary or appropriate relating to procedures for the
termination, resumption, or change in the rate of a Participant's
Deferred Wage Contributions to the Plan. These rules may require prior
written notice to the Investment Advisory Board from the Participant
before any such action may be taken with respect to a Participant's
Deferred Wage Contributions, and may impose a minimum period of
suspension in the case of a Participant who terminates his Deferred Wage
Contributions.
(c) Deferred Wage Contributions shall be treated as Company
Contributions for purposes of Code Sections 401(k) and 414(h).
(d) Deferred Wage Contributions shall be collected by the Company
only through payroll deductions. The Company shall remit the Deferred
Wage Contributions to the Trustee as soon as practicable, but not later
than ninety (90) days from the date such Deferred Wage Contributions are
withheld from the participant's pay.
5.2 Amount Subject to a Deferred Wage Contribution Election.
(a) The amount of a Participant's Compensation that may be deferred
subject to the election provided in Section 5.1 shall be not less than
one percent (1%) nor more than eight percent (8%) of his compensation.
(i) The Investment Advisory Board may prescribe rules
under which the maximum amount that may be deferred by a Participant
who is a Highly Compensated Employee shall be a lesser percentage of
his Compensation than the maximum amount that may be deferred by a
Participant who is not a Highly Compensated Employee.
(b) Notwithstanding anything in this Plan to the contrary, the
maximum amount that a Participant may defer in a single calendar year is
limited to seven thousand dollars ($7,000). This amount shall be
adjusted automatically for increases in the cost-of-living, as determined
under Section 402(g) of the Code.
5.3 Average Deferral Percentage Tests.
(a) The Investment Advisory Board shall monitor the Deferred Wage
Contributions by Participants to insure that, at all times, the
requirements of either Paragraph (b) or (c) are satisfied.
(b) The requirements of this Paragraph (b) are satisfied if the
Average Deferral Percentage for Highly Compensated Employees for the Plan
Year is not more than the Average Deferral Percentage for all other
Covered Employees multiplied by 1.25.
(c) The requirements of this Paragraph (c) are satisfied if--
(i) The excess of the Average Deferral Percentage of the
group of Highly Compensated Employees over that of all other Covered
Employees is not more than two (2) percentage points, and
(ii) The Average Deferral Percentage for the group of
Highly Compensated Employees is not more than twice the Average
Deferral Percentage for all other Covered Employees.
(d) The Company shall maintain records sufficient to demonstrate
satisfaction of the requirements of this Section 5.3.
5.4 Prospective Reductions of Deferrals.
(a) The Investment Advisory Board may determine prior to the end
of the Plan Year whether or not the Average Deferral Percentage tests
of Section 5.3 are satisfied. If it appears that the tests will not be
satisfied, the Investment Advisory Board may elect to reduce the Deferred
Wage Contributions on behalf of Highly Compensated Employees on a
prospective basis.
(b) In the event that Deferred Wage Contributions by Highly
Compensated Employees are reduced by Investment Advisory Board action,
such reductions will be accomplished by reducing the rate of
contributions for the Highly Compensated Employee whose actual deferral
percentage is the highest to the extent required to--
(i) Enable the Plan to satisfy one of the Average
Percentage Tests of Section 5.3, or
(ii) Cause his actual deferral percentage to equal the
ratio of the Highly Compensated Employee with the next highest
actual deferral percentage. If this action does not cause the Plan
to satisfy one of the Average Deferral Percentage tests, this
process will be repeated until one of those tests is satisfied.
5.5 Distributions of Excess Deferred Wage Contributions. In the event a
Participant deferred more than the maximum permitted under Section 5.2(b)
above ("Excess Deferred Wage Contributions"), whether under only this
Plan, or under this Plan and another plan, the Participant may notify the
Plan of the portion of his Excess Deferred Wage Contributions allocable
to the Plan no later than March 1 following the calendar year in which
the Excess Deferred Wage Contributions were made.
(a) Notwithstanding anything in this Plan to the contrary, the
amount of the Participant's Excess Deferred Wage Contributions (and the
earnings thereon) shall be distributed to the Participant no later than
April 15th of the calendar year following the calendar year in which the
Excess Deferred Wage Contributions were made.
(b) Distributions may be made under this Section 5.5 without regard
to the consent requirement of Section 8.5 below.
5.6 Distributions of Excess Contributions. In the event that the Plan fails
to satisfy the Average Deferral Percentage tests of Section 5.3 as of the
last day of the Plan Year, the contributions in excess of those limits
and the earnings thereon ("Excess Contributions") shall be distributed
from the Plan.
(a) The Investment Advisory Board shall undertake action to insure
that this distribution will be made within two and one-half (2-1/2)
months after the end of the Plan Year for which the contributions were
made, but in no event later than the last day of the Plan Year following
the Plan Year in which the Excess Contributions were made.
(b) In the event that the Excess Contributions by the Highly
Compensated Employees are reduced by distributions (of previously-made
Deferred Wage Contributions), such distributions will be accomplished by
reducing the rate of contributions for the Highly Compensated Employee
whose actual deferral percentage is the highest to the extent required
to--
(i) Enable the Plan to satisfy one of the Average
Deferral Percentage tests of Section 5.3 above, or
(ii) Cause his actual deferral percentage to equal the
ratio of the Highly Compensated Employee with the next highest
actual deferral percentage. If this action does not cause the Plan
to satisfy one of the Average Deferral Percentage tests, this
process will be repeated until one of those tests is satisfied.
(iii) The amount to be distributed to a Highly Compensated
Employee shall be determined on the basis of the portion of the
Excess Contributions attributable to him.
(c) The amount of the distributions of Excess Contributions of
Family Members shall be determined in accordance with the regulations
under Code Section 401(k).
(d) Distributions may be made under this Section 5.6 without regard
to the consent requirement of Section 8.5 below.
5.7 Fail-Safe Contributions. In addition to those amounts which may be
contributed to the Trust Fund by the Company under Sections 4.2 and 5.1,
the Company may, in the sole discretion of the Board of Directors,
contribute such additional amounts to the Deferred Wage Contributions
Accounts of various Participants as it deems necessary or appropriate for
any Plan Year to insure satisfaction of at least one of the Average
Deferral Percentage tests set forth in Section 5.3.
5.8 Rollover Contributions.
(a) Any Employee may make a Rollover Contribution (including a
direct transfer or direct rollover) to the Plan under this Section 5.8.
(b) No Rollover Contribution will be accepted unless it satisfies
the applicable requirements of--
(i) an "eligible rollover distribution" as defined in
Section 402(c)(4) of the Code or a "rollover contribution" as
defined in Section 408(d)(3) of the Code, or
(ii) Section 12.2 below.
(c) A Rollover Contribution will not be considered a Deferred Wage
Contribution for purposes of the rules of Articles V, VIII, or XV.
(d) An Employee who makes a Rollover Contribution to the Plan
before becoming a Participant shall be deemed to be a Participant as of
the date of such Rollover Contribution solely for the purpose of
maintaining such Employee's Rollover Contribution Account. Such Employee
shall not receive an allocation of Company Contributions or Forfeitures
or be entitled to elect to have Deferred Wage Contributions made on his
behalf or have any other interest under this Plan until he satisfies the
requirements of Section 3.1.
5.12 Voluntary Contributions. Effective January 1, 1991, Participants may no
longer make any after-tax Voluntary Contributions to the Plan.
ARTICLE VI
ALLOCATIONS TO PARTICIPANTS' ACCOUNTS
6.1 Participants' Company Contribution Accounts. The Investment Advisory
Board shall open and maintain a separate Company Contribution Account,
Rollover Contribution Account (if applicable), Voluntary Contribution
Account (if applicable), Deferred Wage Contribution Account (if
applicable), and a Pension Plan Transfer Account (if applicable) for each
Participant.
6.2 Allocation of Contributions. The contributions to the Plan shall be
allocated to the Accounts of the various Participants according to the
following rules.
(a) The Company Contributions (excluding Deferred Wage
Contributions and Fail-Safe Contributions) for each Plan Year shall be
allocated to the Company Contribution Account of each Participant who is
entitled to receive an allocation in the proportion that his Compensation
during that Plan Year bears to the aggregate Compensation of all
Participants during that Plan Year (who are entitled to receive an
allocation).
(i) A Participant will not be entitled to receive an
allocation of Company Contributions on behalf of a particular Plan
Year, though, unless he is employed by the Company on the last day
of the Plan Year (including those Participants on a Leave of
Absence) or the Participant's employment terminated during the Plan
Year due to death, Disability or retirement.
(b) A Participant's Deferred Wage Contributions and Rollover
Contributions shall be allocated to his respective Account.
(c) The interest of a Participant transferred from the
Harmon Assoc., Corp. Pension Plan shall be allocated to his Pension Plan
Transfer Account.
(d) Fail-Safe Contributions shall be made only on behalf of those
Participants who do not qualify as Highly Compensated Employees.
(i) These contributions shall be allocated to those
Participants whose Compensation for the relevant Plan Year is the
least, starting with the Participant whose Compensation is the
lowest.
(ii) The amount to be allocated to each such
Participant's Deferred Wage Contribution Account shall be the lesser
of the amount necessary to--
(A) Raise his deferral percentage to eight
percent (8%), or
(B) Satisfy one of the tests of Section 5.3.
(e) For purposes of making the allocations of Company Contributions
under this Article VI, any Company Contributions made with respect to a
particular Plan Year that are made after the end of the year but on or
before the due date (including extensions) for the Company's federal
income tax return shall be considered as having been made on the last day
of the Plan Year.
(f) Allocations made pursuant to this Section 6.2 shall not be made
until after the allocations required by Sections 6.3, 6.4, and 15.5 have
been made.
6.3 Revaluation of Accounts.
(a) As of each Valuation Date, the Trustee shall value the assets
of the Trust on the basis of fair market values.
(b) The Investment Advisory Board shall direct the Trustee to
revalue the Accounts of each Participant as of the applicable Valuation
Date so as to reflect a proportionate share in any increase or decrease
in the fair market value of the assets in the Trust Fund, determined by
the Trustee as of that date as compared with the value of the assets in
the Trust Fund determined as of the immediately preceding Valuation Date.
(i) The increase or decrease shall be allocated to each
Account in the proportion that the cumulative amount previously
allocated to the Account, bears to the total of the amounts
previously allocated to all Accounts, adjusted for any contributions
to or distributions from the Account since the immediately preceding
Valuation Date.
(ii) Notwithstanding the above, the following rules shall
apply in the event that some or all of the Accounts are invested on
a segregated basis.
(A) The investment gain or loss attributable to
the segregated investments shall be allocated to the
corresponding Accounts.
(B) Any expenses incurred solely by reason of a
segregated Account shall be borne by that Account.
(c) The allocation of profits or losses and appreciation or
depreciation under this Section 6.3 shall be made prior to the
allocations under Sections 6.2, 6.4, and 15.5.
6.4 Forfeitures. Any amount of a Participant's Company Contribution Account
that is forfeited shall be used in the following manner:
(a) First, to restore the Accounts of former Participants under
Section 8.8; and
(b) Second, any remaining amounts will be allocated to the Company
Contribution Accounts of other Participants in accordance with the rules
of Section 6.2(a).
6.5 Miscellaneous Allocation Rules.
(a) Upon a Participant's Severance, pending distribution of the
Participant's Vested Interest, the Participant's Accounts shall continue
to be maintained and accounted for in accordance with all applicable
provisions of this Plan.
(b) The Investment Advisory Board and the Trustee may establish
accounting procedures for the purpose of making the allocations,
valuations and adjustments to Participants' Accounts provided for in this
Article VI.
(c) The Company, the Investment Advisory Board, and the Trustee do
not in any manner or to any extent whatsoever warrant, guarantee or
represent that the value of a Participant's Accounts shall at any time
equal or exceed the amount previously contributed thereto.
ARTICLE VII
VESTING
7.1 General Rule. The Vested Interest of each Participant in his Company
Contribution Account shall be determined on the basis of his Years of
Service, in accordance with the following schedule:
Years of Service Vested Percentage
Less than 2 0%
3 20%
4 40%
5 60%
6 80%
7 or more 100%
7.2 Special Vesting Rules. Notwithstanding the rules of Section 7.1, the
determination of a Participant's Vested Interest in his Company
Contribution Account shall be subject to the following rules:
(a) During a Participant's period of employment with the Company,
in the event of his death, Disability, or attainment of Normal Retirement
Age, he shall become one hundred percent (100%) vested in his Company
Contribution Account;
(b) In the case of any Participant who does not have a fully Vested
Interest and who incurs five (5) consecutive Breaks in Service, his Years
of Service, if any, after the Breaks in Service shall not be taken into
account for purposes of determining his Vested Interest in his Company
Contribution Account that accrued before the Breaks in Service; and
(c) In the case of a Participant who does not have a fully Vested
Interest and who incurs a Break in Service, his Years of Service, if any,
before the Break in Service shall not be taken into account for purposes
of determining his Vested Interest in his Company Contribution Account
until such time as the Participant has completed a Year of Service after
his Break in Service;
(d) In the case of a Participant who does not have any Vested
Interest and who incurs a Break in Service, his Years of Service, if any,
before the Break in Service shall not be taken into account for purposes
of determining his Vested Interest in his Company Contribution Account
after the Break in Service, provided that his number of consecutive
Breaks in Service equals or exceeds the greater of (i) five (5), or (ii)
his Years of Service prior to his Break in Service;
(e) Years of Service completed before the (original) Effective Date
of the Plan will not be taken into account.
(f) With respect to any Participant who was a Participant in the
Plan on or before December 31, 1988, the vested portion of such
Participant's Company Contribution Account determined in accordance with
the schedule provided herein for Plan Years ending on and before
December 31, 1988, shall be as determined in accordance with the vesting
schedules in effect for Plan Years ending on or before December 31, 1988.
7.3 Participant's Vested Interest in Other Accounts. A Participant shall
always be one hundred percent (100%) vested in his Deferred Wage
Contribution Account, Voluntary Contribution Account, Rollover
Contribution Account, and Pension Plan Transfer Account.
ARTICLE VIII
PAYMENT OF BENEFITS
8.1 Commencement of Benefits.
(a) Subject to the following rules of this Article VIII, a
Participant's benefit shall not be distributed prior to his Severance,
but shall be distributed as soon as administratively practicable
thereafter.
(b) All distributions to Participants or their Beneficiaries shall
be based on the amount of the Participant's Accounts as of the Valuation
Date immediately preceding the date on which the Participant's Vested
Interest is distributed.
8.2 Latest Payment Date.
(a) Subject to the following rules of this Article VIII, payment of
the Participant's entire Vested Interest under the Plan shall begin in no
event later than his "Latest Payment Date," which is the sixtieth (60th)
day after the close of the Plan Year in which the latest of the following
events occurs:
(i) The Participant's Normal Retirement Age;
(ii) The tenth (10th) anniversary of the date on which he
commenced participation in the Plan; or
(iii) The termination of his employment with the Company or
an Affiliated Company.
(b) If it is not possible to make payment to a Participant by his
Latest Payment Date because the amount of his benefit cannot be
ascertained by that date, or because the Investment Advisory Board has
been unable to locate the Participant after making reasonable efforts to
do so, the payment shall be made no later than sixty (60) days after the
earliest date on which the amount of the payment can be ascertained or
the date on which the Participant is located (whichever is applicable).
8.3 Required Beginning Date.
(a) The interest of each Participant shall be distributed to the
Participant not later than his Required Beginning Date.
(b) "Required Beginning Date" shall mean April 1 of the calendar
year following the calendar year in which the Participant attains age
seventy and one-half (70-1/2), whether or not he has yet incurred a
Severance.
(c) All distributions under the Plan shall be made in compliance
with Code Section 401(a)(9) and the regulations thereunder.
8.4 Election to Defer Distribution.
(a) A Participant may elect to defer the commencement of the
payment of his Vested Interest to a date later than his Latest Payment
Date as determined under Section 8.2, but the Participant may not defer
the commencement of his Vested Interest beyond his Required Beginning
Date specified in Section 8.3.
(b) Any such election shall be made by submitting to the Investment
Advisory Board a written statement, signed by the Participant, which sets
forth the date on which the Participant wants the payment of his Vested
Interest to commence.
8.5 Consent to Receive Early Distribution.
(a) A distribution shall not occur prior to the Participant's
Normal Retirement Age where the present value of the Participant's Vested
Interest exceeds thirty-five hundred dollars ($3,500) unless he elects to
receive the distribution (in a manner consistent with the regulations
under Section 417 of the Code) within ninety (90) days prior to the
distribution.
(b) Failure to consent to such a distribution shall be deemed an
election to defer the distribution until the earlier of (i) the
Participant's death or (ii) the Participant's Normal Retirement Age.
(c) This consent requirement shall not apply in the case of the--
(i) Termination of the Plan, provided neither the Company
nor any Affiliated Companies maintain any other defined contribution
plan, other than an employee stock ownership plan. If the
Participant does not consent to an immediate distribution, his
benefit shall be transferred to the other defined contribution plan,
and
(ii) Death of the Participant.
8.6 Distributions Upon Death.
(a) In the event of the death of a Participant, his benefit shall
be paid to a Beneficiary other than his Surviving Spouse only if--
(i) The Spouse of the Participant consents in writing to
the designation of Beneficiary,
(ii) The election designates a Beneficiary (or a form of
benefits) which may not be changed without spousal consent (or the
spousal consent expressly permits designations without any
requirement of further consent by the Spouse), and
(iii) The Spouse's consent acknowledges the effect of the
designation and is witnessed by a Plan Representative or a notary
public, or
(iv) It is established to the satisfaction of a Plan
Representative that the consent required by Subparagraph (i) above
may not be obtained because there is no Spouse, because the Spouse
cannot be located, or because of such other circumstances as may be
set forth in regulations under Code Section 417(a)(2).
"Plan Representative" shall mean the person or persons designated by the
Investment Advisory Board to perform the duties specified herein.
(b) Any consent by a Spouse (or establishment that the consent of a
Spouse may not be obtained) under Paragraph (a) above will be effective
only with respect to that Spouse.
(c) Unless the requirements of Subparagraph (i) or (ii) below are
satisfied, if a Participant dies before distribution of his benefit has
begun, his entire Vested Interest shall be distributed within five (5)
years of his death.
(i) The requirements of this Subparagraph (i) are
satisfied if--
(A) The deceased Participant's Vested Interest
is distributed to a Beneficiary over the life of the
Beneficiary (or a period not extending beyond the
Beneficiary's life expectancy), and
(B) The payments begin not later than one (1)
year after the Participant's death.
(ii) The requirements of this Subparagraph (ii) are
satisfied if the payments are made to the Surviving Spouse of the
deceased Participant beginning not later than the date on which the
Participant would have attained age seventy and one-half (70-1/2)
over the life of the Surviving Spouse (or a period not extending
beyond the Surviving Spouse's life expectancy).
(A) If the Surviving Spouse dies before the
payments commence, the rules of this Subparagraph (ii)
shall be applied as if the Surviving Spouse were the
Participant.
8.7 Designation of Beneficiary.
(a) The rules of Paragraph (b) below shall apply to the
distribution of a Participant's benefit if--
(i) The deceased Participant failed to designate a
Beneficiary,
(ii) The Investment Advisory Board is unable to locate a
designated Beneficiary,
(iii) The Beneficiary predeceased the Participant, or
(iv) The designation of the Beneficiary by the Participant
is legally ineffective.
(b) In the event the rules of Paragraph (a) apply, then any
distribution on behalf of a Participant shall be paid to the person or
persons included in the highest priority category among the following:
(i) The Participant's Surviving Spouse;
(ii) The Participant's surviving children, including
adopted children;
(iii) The Participant's surviving parents;
(iv) The Participant's surviving brothers and sisters
(whether whole or half-blood); or
(v) The Participant's estate.
8.8 Distributions to Partially Vested Participants. If a Participant incurs
a Severance prior to becoming fully vested, his interest in the Plan
shall be determined and disposed of as follows.
(a) In the event that a distribution of Company Contributions is
made to a Participant at a time when he is not fully vested in such
amounts, the nonvested portion of the Participant's Account shall be
forfeited as of the date of the distribution.
(b) A Participant who received a distribution described in
Paragraph (a) above and who is subsequently reemployed by the Company may
recontribute the amount of the distribution he received to the Plan. The
repayment must be made (if at all), however, not later than the date
specified below:
(i) In the case of a distribution upon Severance, the
earlier of the fifth (5th) anniversary of the Employee's
Reemployment Commencement Date, or the date on which the Participant
incurs five (5) consecutive Breaks in Service; or
(ii) In any other case, the fifth (5th) anniversary of the
date of the withdrawal.
(c) If a Participant described in Paragraph (b) above repays the
amount of the distribution within the prescribed time period, the amount
of his Company Contribution Account balance shall be completely restored,
and the Participant's Years of Service before his Severance shall be
taken into account for purposes of determining his Vested Interest in his
Company Contributions Account after his reemployment. Neither the amount
recontributed nor the Account balance (previously forfeited) shall be
adjusted for gains, losses, or interest in the interim period.
(e) If a Participant described in Paragraph (b) above does not
repay the amount of his distribution within the prescribed time period,
the participant's Years of Service before his initial Severance shall be
disregarded for purposes of determining his Vested Interest in his
Company Contribution Account after his reemployment.
(f) If the Participant does not repay the amount of the
distribution and he incurs a second Severance prior to becoming fully
vested, the amount to be distributed to him shall be equal to--
(i) The sum of the amount in his Account as of the date
of the second distribution and the amount previously distributed to
him multiplied by his vested percentage, reduced by
(ii) The amount previously distributed to him.
(g) Forfeitures shall be used as provided in Section 6.4.
8.9 In-Service Withdrawals.
(a) The amount of a Participant's Deferred Wage Contributions may
not be distributed prior to the occurrence of the earliest of any of the
events described below:
(i) Separation from service, death, or disability;
(ii) Termination of the Plan without establishment of a
successor plan;
(iii) Sale of substantially all of the assets used by the
Company in a trade or business (applicable only to the transferred
Employees); or
(iv) Sale of the Company's interest in a subsidiary
corporation (applicable only to the transferred Employees).
(b) Notwithstanding the foregoing, the Investment Advisory Board
may prescribe rules and procedures which permit a Participant to make
withdrawals of his Deferred Wage Contributions and Rollover Contributions
prior to termination of employment if the Participant --
(i) Has attained age 59-1/2 (but only with respect to the
Participant's Account balance as of December 31, 1994), or
(ii) Incurs a hardship under the rules of Section 8.13
below.
(c) A Participant may withdraw some or all of the amounts in his
Voluntary Contribution Account as of December 31, 1994 upon thirty (30)
days prior notice to the Investment Advisory Board.
(d) A Participant must withdraw all the amounts in his Voluntary
Contribution Account as of December 31, 1994 prior to withdrawing amounts
from any other Accounts. After he has withdrawn the entire amounts in
his Voluntary Contribution Account as of December 31, 1994, he may
withdraw amounts from his Deferred Wage Contribution Account.
(e) The Investment Advisory Board shall prescribe such rules as it
deems necessary regarding the timing of payments under this Section 8.9.
8.10 Payees under Legal Disability. If any payee under the Plan is a minor,
or if the Investment Advisory Board reasonably believes that any payee is
legally incapable of giving a valid receipt and discharge for any payment
due him, the Investment Advisory Board may have the payment, or any part
of it, made to the person (or persons or institution) whom it reasonably
believes is caring for or supporting the payee.
8.11 Notice Regarding Tax Treatment of Distributions. The Investment Advisory
Board shall provide a written explanation regarding the Code provisions
relating to the tax treatment of distributions to each distributee
receiving a distribution any portion of which may be rolled over tax-free
to another tax-qualified retirement plan or to an individual retirement
account.
8.13 Hardship Distributions. A Participant from time to time may make a
withdrawal from his Deferred Wage Contribution Account upon the
occurrence of a hardship in accordance with the provisions of this
Section 8.13. The distribution must both be made on account of an
immediate and heavy financial need (as determined under Paragraph (a)
below) and be necessary to satisfy that need (as determined under
Paragraph (b) below). The Investment Advisory Board shall determine the
amount of such withdrawal, but in no event shall the cumulative amount of
such withdrawals exceed the lesser of (i) the total amount of the
Participant's Deferred Wage Contributions or (ii) the balance of the
Participant's Deferred Wage Contribution Account as of the Valuation Date
immediately preceding such withdrawal. Payment of amounts withdrawn by a
Participant shall be made, to the extent practicable, pro rata from the
investment funds in which the Participant's Deferred Wage Contribution
Account is invested or as the Investment Advisory Board may permit the
Participant to direct.
(a) For purposes of this Section 8.13, hardship distributions shall
be limited to the reasons set forth below and distributions for these
reasons shall automatically be considered to be made on account of an
immediate and heavy financial need:
(i) Medical expenses (described in Section 213(d) of the
Code) incurred by the Participant, his Spouse, or dependent (as
defined in Code Section 152);
(ii) Purchase (excluding mortgage payments) of a principal
residence of the Participant;
(iii) Payment of tuition for the next semester or quarter
of post-secondary education for the Participant, or for his Spouse,
children, or dependents; or
(iv) Need to prevent the eviction of the Participant from
his principal residence or foreclosure on the mortgage on his
principal residence.
(b) A distribution will automatically be treated as necessary to
satisfy an immediate and heavy financial need if all of the following
conditions are satisfied:
(i) The distribution is not in excess of the immediate
and heavy financial need of the Participant;
(ii) The Participant has obtained all distributions, other
than hardship distributions, and all nontaxable loans currently
available under all tax-qualified retirement plans maintained by the
Company;
(iii) The Participant's Deferred Wage Contributions will be
suspended for twelve (12) months after receipt of the hardship
distribution. However, the Participant will still be treated as
being eligible to participate in the Plan for purposes of the
Average Deferral Percentage tests of Section 5.3; and
(iv) The Participant will be precluded from making any
Deferred Wage Contributions for the calendar year following the
calendar year in which the hardship distribution was made in excess
of the amount determined under the following sentence. The
Participant's maximum Deferred Wage Contributions for such next
calendar year will be the maximum Deferred Wage Contributions
allowed for that calendar year, reduced by the amount of the
Participant's Deferred Wage Contributions for the prior calendar
year.
(c) The Plan requires a minimum withdrawal amount for each hardship
category. A minimum withdrawal of five hundred dollars ($500.00) is
required for medical or educational hardship. A minimum withdrawal of
one thousand dollars ($1,000.00) is required for the purpose of a
Participant's purchase of a new principal residence, for preventing a
Participant's eviction from his principal residence, or for preventing
foreclosure of the mortgage on a Participant's principal residence.
8.14 Form of Distributions. Participants may elect that their benefit be
distributed in any one of the forms listed below.
(a) Lump sum distribution.
(b) Equal annual installments over the lesser of fifteen (15) years
or your remaining life expectancy.
(c) Life Annuity.
(d) Life Annuity with five (5) year or ten (10) year period
certain.
(e) Monthly installments paid over the Participant's remaining
expected life expectancy.
(f) Joint and Survivor Annuity, with the amount of the annuity
payable to the Surviving Spouse to be 50%, 66-2/3rd%, 75%, or 100% of the
amount payable to the Participant.
For purposes of the above rules, if a Participant's benefit is to be
distributed in a series of installments over a specified number of years,
the minimum amount to be distributed each year shall be at least equal to
the quotient obtained by dividing his Vested Interest by the specified
number of years. Notwithstanding the foregoing, the forms of
distribution listed in paragraphs (c), (d), (e) and (f) of this
Section 8.14 shall only be available with respect to Participants'
Account balances determined as of December 31, 1994.
8.15 Direct Transfer of Eligible Rollover Distributions. Notwithstanding any
provision of the Plan to the contrary, a "distributee" under the Plan (as
defined below) who receives an "eligible rollover distribution" (as
defined below) under Section 8.14 may elect, at the time and in the
manner prescribed by the Investment Advisory Board, to have any portion
of the distribution paid directly to an "eligible retirement plan" (as
defined below) designated by the distributee in a direct rollover. 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 the following:
(a) Any distribution that is one of a series of substantially equal
periodic payments (not less frequently than annually) made for the life
(or life expectancy) of the distributee or the joint lives (or joint life
expectancies) of the distributee and the distributee's designated
beneficiary, or for a specified period of ten years or more;
(b) Any distribution to the extent such distribution is required
under Code Section 401(a)(9); and
(c) The portion of any distribution that is not includible in gross
income (determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
An eligible retirement plan is an individual retirement account described
in Code Section 408(a), an individual retirement annuity described in
Code Section 408(d), an annuity plan described in Code Section 403(a), or
a qualified trust described in Code Section 401(a), that accepts the
distributee's eligible rollover distribution. However, in the case of an
eligible rollover distribution to the Surviving Spouse of a Participant,
an eligible retirement plan is an individual retirement account or
individual retirement annuity. For purposes of the Plan, a Participant's
Surviving Spouse and the Participant's spouse or former spouse who is an
alternate payee under a qualified domestic relations order, as defined in
Code Section 414(p), are distributees with regard to their respective
interests.
ARTICLE IX
SURVIVOR ANNUITY REQUIREMENTS
9.1 Application of Article.
(a) The provisions of this Article IX shall apply only with respect
to those Participants who have elected that some or all of their Account
balances under the Plan as of December 31, 1994 be paid in the form of an
annuity. However, once a Participant has made such an election, the
provisions of this Article IX shall always thereafter apply to his
Account balances as of December 31, 1994.
(b) The provisions of this Article IX shall apply with respect to
the payment of all of a Participant's Account balances under the Plan
determined as of December 31, 1994. Thus, the provisions of this Article
IX will apply to in-service withdrawals under Section 8.9 of
Participants' Account balances determined as of December 31, 1994.
(c) This Article IX will not apply, however, to--
(i) The proceeds of a life insurance contract (if any)
maintained by the Plan for the Participant to the extent the
proceeds exceed the amount of the Participant's Vested Interest
immediately prior to his death, or
(ii) Distributions subject to Section 16.2, except to the
extent provided in a Qualified Domestic Relations Order.
9.2 Definitions.
(a) "Qualified Joint and Survivor Annuity" means an annuity --
(i) For the life of the Participant with a survivor
annuity for the life of the Spouse which is not less than fifty
percent (50%) of, and is not greater than one hundred percent (100%)
of, the amount of the annuity which is payable during the joint
lives of the Participant and the Spouse, and
(ii) Which is the actuarial equivalent of a single life
annuity for the life of the Participant.
This term shall also refer to any annuity in a form having the
effect of an annuity described above.
(b) "Qualified Preretirement Survivor Annuity" means an annuity for
the life of the Surviving Spouse of the Participant the actuarial
equivalent of which is not less than fifty percent (50%) of the
Participant's Account balances as of December 31, 1994. The payment of
this benefit must commence within a reasonable time after the date of the
Participant's death.
(c) "Annuity Starting Date" means--
(i) The first day of the first period for which an amount
is received as an annuity, or
(ii) In the case of a benefit not payable in the form of
an annuity, the first day on which all events have occurred which
entitle the Participant to the benefit.
(d) "Applicable Election Period" means --
(i) In the case of an election to waive the Qualified
Joint and Survivor Annuity, the ninety (90) day period ending on the
Annuity Starting Date, or
(ii) In the case of an election to waive the Qualified
Preretirement Survivor Annuity, the period beginning with the first
day of the Plan Year in which the Participant attains age thirty-two
(32) and ending with whichever of the following periods ends last:
(A) The close of the Plan Year preceding the
Plan Year in which the Participant attains age
thirty-five (35);
(B) A reasonable period after the individual
becomes a Participant;
(C) A reasonable period after the Qualified
Joint and Survivor Annuity election period begins;
(D) A reasonable period after the provisions of
this Article IX apply to the Participant, or
(E) A reasonable period after separation from
service in the case of a Participant who separates before
attaining age thirty-five (35).
9.3 Form of Benefits Provided. Except as otherwise provided under
Sections 9.4 and 9.5 --
(a) In the case of a Participant with an Account balance under the
Plan as of December 31, 1994 who does not die before his Annuity Starting
Date and who has a Surviving Spouse, his Account balance as of
December 31, 1994 shall be paid in the form of a one hundred percent
(100%) Qualified Joint and Survivor Annuity, and
(b) In the case of a Participant with an Account balance under the
Plan as of December 31, 1994 who dies before his Annuity Starting Date
and who has a Surviving Spouse, a Qualified Preretirement Survivor
Annuity shall be paid to his Surviving Spouse, in the form of the
survivor portion of a one hundred percent (100%) Qualified Joint and
Survivor Annuity.
(c) In the case of a Participant with an Account balance under the
Plan as of December 31, 1994 who does not have a Surviving Spouse, his
Account balance as of December 31, 1994 shall be paid in the form of a
single life annuity.
(e) Any benefits payable under Paragraph (a) or (b) shall be the
Actuarial Equivalent of the retirement benefits of such Participant
payable in the form of the annuity described in Paragraph (c) and
commencing on his Normal Retirement Age.
9.4 Elections With Respect to Survivor Annuities.
(a) At any time during the Applicable Election Period, each
Participant may --
(i) Elect to waive the Qualified Joint and Survivor
Annuity or the Qualified Preretirement Survivor Annuity (or both),
and
(ii) Revoke any such election.
(b) An election under Paragraph (a)(i) above shall not take effect
unless --
(i) The Spouse of the Participant consents in writing to
the election,
(ii) The election designates a Beneficiary (or a form of
benefits) which may not be changed without spousal consent (or the
spousal consent expressly permits designations without any
requirement of further consent by the Spouse), and
(iii) The Spouse's consent acknowledges the effect of the
election and is witnessed by a Plan Representative or a notary
public, or
(iv) It is established to the satisfaction of a Plan
Representative that the consent required by Subparagraph (i) above
may not be obtained because there is no Spouse, because the Spouse
cannot be located, or because of such other circumstances as may be
set forth in regulations under Code Section 417(a)(2).
For purposes of this Paragraph (b), "Plan Representative" shall mean the
person or persons designated by the Investment Advisory Board to perform
the duties specified herein.
(c) Within a reasonable period of time before the Participant's
Annuity Starting Date (and consistent with regulations under
Section 417(a)(3)(A) of the Code) each Participant shall receive a
written explanation of --
(i) The terms and conditions of the Qualified Joint and
Survivor Annuity,
(ii) The Participant's right to make, and the effect of,
an election under Paragraph (a) above to waive the Qualified Joint
and Survivor Annuity form of benefit,
(iii) The rights of the Participant's Spouse under
Paragraph (b) above, and
(iv) The right to make, and the effect of, a revocation of
an election under Paragraph (a) above.
(d) Each Participant shall receive, within the Applicable Election
Period, a written explanation with respect to the Qualified Preretirement
Survivor Annuity comparable to that required under Paragraph (c) above.
9.5 Lump Sum Distributions.
(a) Notwithstanding the preceding provisions of this Article IX, if
the present value of the Participant's Vested Interest in his benefit
(payable in either the Qualified Joint and Survivor Annuity or in the
Qualified Preretirement Survivor Annuity) does not exceed thirty-five
hundred dollars ($3,500), the benefit shall be paid in a single lump sum
determined in accordance with the rules of Section 8.5.
(b) However, no lump sum benefit shall be paid after the
Participant's Annuity Starting Date, unless the Participant and his
Spouse (or where the Participant has died, his Surviving Spouse, consent
in writing to such distribution.
(c) The Participant's Vested Interest may be paid in a lump sum
if--
(i) The present value of the Participant's Vested
Interest in his benefit exceeds thirty-five hundred dollars
($3,500), and
(ii) The Participant and the Spouse of the Participant
consent in writing to the distribution not earlier than ninety (90)
days prior to the distribution.
ARTICLE X
TOP-HEAVY PLAN RULES
10.1 Applicability. Notwithstanding any provision in this Plan to the
contrary, the provisions of this Article X shall apply in the case of any
Plan Year in which the Plan is determined to be a Top-Heavy Plan.
10.2 Special Valuation Rules.
(a) For purposes of determining--
(i) The present value of the cumulative accrued benefit
of any Employee, or
(ii) The amount of the account balance of any Employee,
such present value or amount shall be increased by the aggregate
distributions made with respect to the Employee under the plan during the
five (5) year period ending on the Determination Date. The preceding
rule shall also apply to distributions under a terminated plan that, if
it had not been terminated, would have been required to be included in
the Aggregation Group that includes the Plan.
(b) Any Rollover Contribution or similar transfer initiated by the
Employee and made after December 31, 1983 to a plan shall not be taken
into account with respect to the transferee plan for purposes of
determining whether the plan is a Top-Heavy Plan (or whether any
Aggregation Group which includes the plan is a Top-Heavy Group).
(c) If any individual--
(i) Is a Non-Key Employee with respect to any plan for
any plan year, but the individual was a Key Employee with respect to
the plan for any prior plan year, or
(ii) Has not performed any services for the Company or an
Affiliated Company at any time during the five (5) year period
ending on the Determination Date,
any accrued benefit for the individual (and the account balance of the
individual) shall not be taken into account for purposes of determining
whether or not the plan is a Top-Heavy Plan.
10.3 Minimum Contributions. For each Plan Year in which the Plan is
Top-Heavy, the minimum contributions for that year shall be determined in
accordance with the rules of this Section 10.3.
(a) Except as provided below, the minimum contribution for each
Participant who is a Non-Key Employee who is employed on the last day of
the Plan Year shall be not less than three percent (3%) of his
Compensation, regardless of the number of Hours of Service he completes
that Plan Year or his level of Compensation.
(b) The minimum required contribution under Paragraph (a) above
shall be reduced by the Company contributions and forfeitures allocated
to the Participant in any other defined contribution plan included in the
Aggregation Group that includes the Plan. For this purpose, Company
contributions shall not include any salary reduction contributions made
on behalf of a Non-Key Employee to a qualified cash or deferred
arrangement as described in Code Section 401(k).
(c) Subject to the following rules of this Paragraph (c), the
percentage set forth in Paragraph (a) above shall not be required to
exceed the percentage at which contributions (including any Deferred Wage
Contributions) are made under the Plan for the year for the Key Employee
for whom the percentage is the highest for the year.
(i) For purposes of this Paragraph (c), all defined
contribution plans required to be included in an Aggregation Group
shall be treated as one plan.
(ii) The rules of this Paragraph (c) shall not apply to
any plan required to be included in an Aggregation Group if the plan
enables a defined benefit plan to meet the requirements of Code
Sections 401(a)(4) or 410.
(d) The requirements of this Section 10.3 must be satisfied without
taking into account contributions under chapters 2 or 21 of the Code,
title II of the Social Security Act, or any other Federal or State law.
(e) In the event a Participant is covered by both a defined
contribution and a defined benefit plan maintained by the Company, both
of which are determined to be Top-Heavy, the minimum benefit shall be
provided under this Plan, which shall be a contribution of at least five
percent (5%) of Compensation.
10.4 Maximum Annual Addition.
(a) Except as set forth below, in the case of any Top-Heavy Plan,
the rules of Sections 15.4(b)(ii) and 15.4(c)(ii) shall be applied by
substituting "1.0" for "1.25".
(b) The rule set forth in Paragraph (a) above shall not apply if
the requirements of both Subparagraphs (i) and (ii) are satisfied.
(i) The requirements of this Subparagraph (i) are
satisfied if the Plan would not be a Top-Heavy Plan if
"ninety percent (90%)" were substituted for "sixty percent (60%)"
each place it appears in Section 2.50.
(ii) The requirements of this Subparagraph (ii) are
satisfied if the required minimum contribution under Section 10.3(a)
above would be satisfied if it were applied by substituting "four
percent (4%)" for "three percent (3%)" each place it appears
therein. Notwithstanding the provisions of the preceding sentence,
in the case of an Employee covered by both this Plan and a Top-Heavy
defined benefit plan maintained by the Company or an Affiliated
Company, the minimum contribution/benefit shall be provided solely
under this Plan, which shall be applied by substituting "seven and
one-half percent (7-1/2%)" for "three percent" each place it appears
in Section 10.3(a).
(c) The rules of Paragraph (a) shall not apply with respect to any
Employee for any Plan Year as long as there are no--
(i) Annual Additions allocated to the Employee under a
defined contribution plan maintained by the Company or an Affiliated
Company, or
(ii) Accruals by the Employee under a defined benefit plan
maintained by the Company or an Affiliated Company.
10.5 Vesting Rules.
(a) In the event that the Plan is determined to be a Top-Heavy
Plan, then the vesting schedule of the Plan (with respect to all benefits
earned under the Plan) must be changed to that set forth below, (if more
rapid than that set forth in Article VII).
Years of Service Nonforfeitable Percentage
2 20%
3 40%
4 60%
5 80%
6 or more 100%
(b) The vesting schedule of Paragraph (a) above shall apply,
notwithstanding the Participant's withdrawal of any mandatory
contributions.
(c) In the event the Plan ceases to be Top-Heavy, the Plan's
vesting schedule may be changed only in accordance with Code
Section 411(a)(10).
10.6 Non-Eligible Employees. The rules of Sections 10.3, 10.4, and 10.5
shall not apply to any Employee--
(a) Included in a unit of Employees covered by an agreement which
the Secretary of Labor finds to be a collective bargaining agreement
between Employee representatives and one or more employers, if there is
evidence that retirement benefits were the subject of good faith
bargaining between the Employee representatives and the Company, or
(b) Whose employment was terminated before the Plan became
Top-Heavy.
ARTICLE XI
INVESTMENT ADVISORY BOARD
11.1 Membership. An Investment Advisory Board consisting of such number of
persons as determined by the Chief Executive Officer of Fort Howard
Corporation shall be appointed by the Chief Executive Officer of Fort
Howard Corporation. The Secretary of Fort Howard Corporation shall
certify to the Trustee from time to time the appointment to (and
termination of) office of each member of the Investment Advisory Board
and the person who is selected as secretary of the Investment Advisory
Board.
11.2 General Powers, Rights and Duties. Except as otherwise specifically
provided and in addition to the powers, rights and duties specifically
given to the Investment Advisory Board elsewhere in the Plan and the
Trust, the Investment Advisory Board shall have the following
discretionary powers, rights and duties:
(a) To select a secretary, if it believes it advisable, who may but
need not be a member of the Investment Advisory Board.
(b) To determine all questions arising under the Plan, including
the power to determine the rights or eligibility of Employees or
Participants and any other persons, and the amounts of their benefits
under the Plan, and to remedy ambiguities, inconsistencies or omissions.
(c) To adopt such rules of procedure and regulations as in its
opinion may be necessary for the proper and efficient administration of
the Plan as are consistent with the Plan and Trust.
(d) To enforce the Plan in accordance with the terms of the Plan
and the Trust and the rules and regulations adopted by the Investment
Advisory Board as above.
(e) To direct the Trustee as respects payments or distributions
from the Trust Fund in accordance with the provisions of the Plan.
(f) To furnish the Company with such information as may be required
by it for tax or other purposes in connection with the Plan.
(g) To employ agents, attorneys, accountants, actuaries or other
persons (who also may be employed by the Fort Howard Corporation) and to
allocate or delegate to them such powers, rights and duties as the
Investment Advisory Board may consider necessary or advisable to properly
carry out administration of the Plan, provided that such allocation or
delegation and the acceptance thereof by such agents, attorneys,
accountants, actuaries or other persons, shall be in writing.
11.3 Manner of Action. During a period in which two or more members of the
Investment Advisory Board are acting, the following provisions apply
where the context admits:
(a) A member of the Investment Advisory Board by writing may
delegate any or all of his rights, powers, duties and discretions to any
other member, with the consent of the latter.
(b) The members of the Investment Advisory Board may act by meeting
or by writing signed without meeting, and may sign any document by
signing one document or concurrent documents.
(c) An action or a decision (which may be taken without a meeting)
of a majority of the members of the Investment Advisory Board as to a
matter shall be as effective as if taken or made by all members of the
Investment Advisory Board.
(d) If, because of the number qualified to act, there is an even
division of opinion among the members of the Investment Advisory Board as
to a matter, a disinterested party selected by the Investment Advisory
Board shall decide the matter and his decision shall control.
(e) Except as otherwise provided by law, no member of the
Investment Advisory Board shall be liable or responsible for an act or
omission of the other members of the Investment Advisory Board in which
the former has not concurred.
(f) The certificate of the secretary of the Investment Advisory
Board or of a majority of the members of the Investment Advisory Board
that the Investment Advisory Board has taken or authorized any action
shall be conclusive in favor of any person relying on the certificate.
11.4 Interested Member. If a member of the Investment Advisory Board also is
a Participant in the Plan, he may not decide or determine any matter or
question concerning distributions of any kind to be made to him or the
nature or mode of settlement of his benefits unless such decision or
determination could be made by him under the Plan if he were not serving
on the Investment Advisory Board.
11.5 Resignation or Removal of Members. A member of the Investment Advisory
Board may be removed by the Chief Executive Officer of Fort Howard
Corporation at any time. A member of the Investment Advisory Board may
resign at any time. The Chief Executive Officer of Fort Howard
Corporation may fill any vacancy in the membership of the Investment
Advisory Board. The Chief Executive Officer of Fort Howard Corporation
shall give prompt written notice thereof to the other members of the
Investment Advisory Board. Until any such vacancy is filled, the
remaining members may exercise all of the powers, rights and duties
conferred on the Investment Advisory Board.
11.6 Expenses. All costs, charges and expenses reasonably incurred by the
Investment Advisory Board will be paid from the Trust Fund or by
Fort Howard Corporation, as directed by the Investment Advisory Board.
No compensation will be paid to a member of the Investment Advisory Board
as such.
11.7 Information Required. Each person entitled to benefits under the Plan
must file with the Investment Advisory Board from time to time in writing
such person's post office address and each change of post office address.
Any communication, statement or notice addressed to any person at the
last post office address filed with the Investment Advisory Board will be
binding upon such person for all purposes of the Plan. Each person
entitled to benefits under the Plan also shall furnish the Investment
Advisory Board with such documents, evidence, data or information as the
Investment Advisory Board considers necessary or desirable for the
purpose of administering the Plan. The Company shall furnish the
Investment Advisory Board with such data and information as the
Investment Advisory Board may deem necessary or desirable in order to
administer the Plan. The records of the Company as to an Employee's or
Participant's period of employment, Hours of Service, Severance and the
reason therefor, Leave of Absence, reemployment and Compensation will be
conclusive on all persons unless determined to the Investment Advisory
Board's satisfaction to be incorrect.
11.8 Uniform Rules. The Investment Advisory Board shall administer the Plan
on a reasonable and nondiscriminatory basis and shall apply uniform rules
to all persons similarly situated.
11.9 Review of Benefit Determinations. The Investment Advisory Board will
provide notice in writing to any Participant or Beneficiary whose claim
for benefits under the Plan is denied and the Investment Advisory Board
shall afford such Participant or Beneficiary a full and fair review of
its decision if so requested.
11.10 Final Decision. Subject to applicable law, any interpretation of the
provisions of the Plan and any decisions on any matter within the
discretion of the Investment Advisory Board made by the Investment
Advisory Board in good faith shall be binding on all persons. A
misstatement or other mistake of fact shall be corrected when it becomes
known and the Investment Advisory Board shall make such adjustment on
account thereof as it considers equitable and practicable.
ARTICLE XII
MERGER OF COMPANY, MERGER OF PLAN
12.1 Effect of Reorganization or Transfer of Assets.
(a) In the event of a consolidation, merger, sale, liquidation, or
other transfer of substantially all of the operating assets of the
Company to any other company, the ultimate successor or successors to the
business of the Company shall automatically be deemed to have elected to
continue this Plan in full force and effect, in the same manner as if the
Plan had been adopted by resolution of its board of directors.
(b) The presumption set forth in Paragraph (a) above shall not
apply if the successor, by resolution of its board of directors, elects
not to so continue this Plan in effect. In such a case, the Plan shall
terminate as of the effective date set forth in the board resolution.
12.2 Plan Merger Restriction.
(a) This Plan shall not merge or consolidate with, or transfer its
assets and/or liabilities to any other plan unless each affected
Participant in this Plan would receive a benefit immediately after the
merger, consolidation, or transfer (if the Plan then terminated) which is
equal to or greater than the benefit he would have been entitled to
receive immediately before the merger, consolidation, or transfer (if the
Plan had then terminated).
(b) Provided the requirements set forth in Paragraph (a) above are
satisfied, the Investment Advisory Board may direct that the Plan may
merge, consolidate with, or transfer its assets and/or liabilities to
another tax-qualified retirement plan.
ARTICLE XIII
TERMINATION AND
DISCONTINUANCE OF CONTRIBUTIONS
13.1 Plan Termination.
(a) The Company may terminate the Plan at any time by an instrument
in writing executed in the name of the Company by an officer or officers
duly authorized to execute such an instrument, and delivered to the
Trustee.
(b) The rights of all Employees to the balances in their Accounts
as of the date of termination of the Plan, shall automatically become
fully vested as of that date.
13.2 Discontinuance of Contributions. On and after the effective date of a
discontinuance of Company Contributions, the rights of all Employees to
the balances in their Accounts shall automatically become fully vested as
of that date.
13.3 Replacement Plan. The provisions of Sections 13.1 and 13.2 shall not
apply in the event that the Plan is replaced by a comparable plan.
13.4 Partial Termination.
(a) In the event of a partial termination of the Plan within the
meaning of Code Section 411(d)(3), all Employees affected by such event
shall become fully vested as of that date.
(b) This Section 13.4 is intended solely to meet the requirements
of Code Section 411 and is not intended to create, nor shall it be
construed as creating, any contractual rights whatsoever.
ARTICLE XIV
APPLICATION FOR BENEFITS
14.1 Application for Benefits.
(a) The Investment Advisory Board may require any person claiming
benefits under the Plan ("Claimant") to submit an application therefor,
together with such other documents and information as the Investment
Advisory Board may require.
(b) Within ninety (90) days following receipt of the application
and all necessary documents and information, the Investment Advisory
Board's authorized delegate reviewing the claim shall furnish the
Claimant with written notice of the decision rendered with respect to the
application.
(c) Should special circumstances require an extension of time for
processing the claim, written notice of the extension shall be furnished
to the Claimant prior to the expiration of the initial ninety (90) day
period.
(i) The notice shall indicate the special circumstances
requiring an extension of time and the date by which a final
decision is expected to be rendered.
(ii) In no event shall the period of the extension exceed
ninety (90) days from the end of the initial ninety (90) day period.
(d) In the case of a denial of the Claimant's application, the
written notice shall set forth:
(i) The specific reasons for the denial;
(ii) References to the Plan provisions upon which the
denial is based;
(iii) A description of any additional information or
material necessary for perfection of the application (together with
an explanation of why the material or information is necessary); and
(iv) An explanation of the Plan's claim review procedure.
14.2 Appeals.
(a) In order to appeal the decision rendered with respect to his
application for benefits or with respect to the amount of his benefits,
the Claimant must follow the appeal procedures set forth in this
Section 14.2.
(b) The appeal must be made, in writing--
(i) In the case where the claim is expressly rejected,
within sixty-five (65) days after the date of notice of the decision
with respect to the application, or
(ii) In the case where the claim has neither been approved
nor denied within the applicable period provided in Section 14.1
above, within sixty-five (65) days after the expiration of the
period.
(c) The Claimant may request that his application be given full and
fair review by the Investment Advisory Board. The Claimant may review
all pertinent documents and submit issues and comments in writing in
connection with the appeal.
(d) The decision of the Investment Advisory Board shall be made
promptly, and not later than sixty (60) days after the Investment
Advisory Board's receipt of a request for review, unless special
circumstances require an extension of time for processing. In such a
case, a decision shall be rendered as soon as possible, but not later
than one hundred twenty (120) days after receipt of the request for
review.
(e) The decision on review shall be in writing and shall include
specific reasons for the decision, written in a manner designed to be
understood by the Claimant, with specific reference to the pertinent Plan
provisions upon which the decision is based.
14.3 Exhaustion of Remedies. No legal action for benefits under the Plan may
be brought unless and until the Claimant has exhausted his remedies under
this Article XIV.
ARTICLE XV
LIMITATIONS ON CONTRIBUTIONS
15.1 General Rule.
(a) Notwithstanding anything to the contrary contained in this
Plan, the total Annual Additions under this Plan to a Participant's
Accounts for any Plan Year shall not exceed the lesser of:
(i) Thirty thousand dollars ($30,000) or such greater
amount as may be permitted pursuant to Section 415(d)(1) of the Code
("Dollar Limitation"); or
(ii) Twenty-five percent (25%) of the Participant's annual
Compensation ("Percentage Limitation").
(b) Because the Limitation Year is also the Plan Year, in the case
of a Plan Year of less than twelve (12) months duration, the Dollar
Limitation shall be prorated by multiplying it by a fraction, the
numerator of which is the number of months in the short Plan Year and the
denominator of which is twelve (12).
(c) The Dollar Limitation shall be adjusted annually by the
Internal Revenue Service for increases in the cost of living, effective
January 1 of the year for which the adjustment is made, which adjustment
applies to the Limitation Year ending with or within that calendar year.
15.2 Definition of Compensation. The following definition of "Compensation"
shall apply for purposes of this Article XV.
(a) A Participant's "Compensation" includes:
(i) His wages, salaries, fees for professional services,
and other amounts received for personal services actually rendered
in the course of employment with the Company (including, but not
limited to, commissions paid to salesmen, compensation for services
on the basis of a percentage of profits, commissions on insurance
premiums, tips, and bonuses);
(ii) Amounts described in Code Sections 104(a)(3) and
105(a) (relating to medical care), but only to the extent that these
amounts are includable in the gross income of the Participant;
(iii) Amounts paid or reimbursed by the Company for moving
expenses incurred by a Participant, but only to the extent that
these amounts are not deductible by the Participant under Code
Section 217; and
(iv) The amount includable in the gross income of the
Participant upon making the election described in Code
Section 83(b).
(b) A Participant's "Compensation" does not include:
(i) Contributions made by the Company to a plan of
deferred compensation to the extent that, before the application of
the limitations of this Article XV to that plan, the contributions
are not includable in his gross income for the taxable year in which
they were contributed;
(ii) Any distributions from a plan of deferred
compensation, regardless of whether the amounts are includable in
the gross income of the Participant when distributed. However, any
amounts received by the Participant pursuant to an unfunded
non-qualified plan shall be considered as Compensation for the year
the amounts are includable in gross income;
(iii) Amounts realized from the exercise of a nonqualified
stock option, or when restricted stock (or property) held by the
Participant either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture; and
(v) Other amounts which receive special tax benefits,
such as premiums for group term life insurance (but only to the
extent that the premiums are not includable in the gross income of
the Participant).
15.3 Other Defined Contribution Plans. If the Company or an Affiliated
Company is or was contributing to any other defined contribution plan,
then the Participant's Annual Additions in the other plan shall be
aggregated with the Participant's Annual Additions under this Plan for
purposes of applying the limitations of this Article XV. This rule shall
apply whether or not the plan has been terminated.
15.4 Defined Benefit Plans. If the Company or an Affiliated Company is or was
contributing to a defined benefit plan, then in addition to the
limitations contained in Section 15.1 of this Plan, the "Combined Plan
Fraction" shall not exceed 1.0. This rule shall apply whether or not the
plan has been terminated.
(a) "Combined Plan Fraction" means a fraction determined in
accordance with the provisions of Code Section 415(e) and the following
rules. This fraction shall be the sum of the Defined Contribution Plan
Fraction and the Defined Benefit Plan Fraction. In the event that the
Combined Plan Fraction would exceed 1.0:
(i) The amount in the numerator of the Defined
Contribution Plan Fraction shall be reduced in accordance with the
applicable regulations; then, if necessary,
(ii) The limit otherwise applicable to the Participant
under any or all defined benefit plans shall be accordingly reduced.
(b) "Defined Contribution Plan Fraction" means a fraction
determined in accordance with the provisions of Code Section 415(e) and
the following rules with respect to the combined participation by a
Participant in all defined contribution plans of the Company and all
Affiliated Companies.
(i) The numerator of the fraction is the sum of all
Annual Additions to the Participant's accounts under all such plans
as of the close of the Plan Year.
(ii) The denominator of the fraction is the sum of the
lesser of the following amounts determined separately with respect
to the current Plan Year and each prior year of service:
(A) The product of 1.25 multiplied by the
Dollar Limitation under Section 15.1(a)(i) in effect for
that Plan Year; or
(B) The product of 1.4 multiplied by the
Percentage Limitation under Section 15.1(a)(ii) with
respect to the Participant for such Plan Year.
(c) "Defined Benefit Plan Fraction" means a fraction determined in
accordance with the provisions of Code Section 415(e) and the following
rules with respect to the combined participation by a Participant in all
defined benefit plans of the Company and all Affiliated Companies.
(i) The numerator of the fraction is the projected annual
benefit of the Participant under all the plans (determined as of the
close of the Plan Year).
(ii) The denominator of this fraction is the lesser of:
(A) The product of 1.25 multiplied by the
dollar limitation under Code Section 415(b)(1)(A) for the
Plan Year; or
(B) The product of 1.4 multiplied by the
percentage of compensation limitation under Code Section
415(b)(1)(B) with respect to the Participant for the Plan
Year.
15.5 Adjustments for Excess Annual Additions. In the event the Annual
Additions to a Participant's Accounts under this Plan would exceed the
applicable limitations described in Sections 15.1 through 15.4, the
excess amount shall be subject to the following rules.
(a) If the Participant had made any after-tax contributions to the
Plan or to any other defined contribution plan that is maintained by the
Company or an Affiliated Company which would be aggregated with this Plan
under Section 15.3 during the Plan Year, these contributions and the
earnings thereon shall be returned to the Participant to the extent of
any excess Annual Additions.
(b) If excess Annual Additions remain, amounts which give rise to
the excess Annual Additions under this Plan shall be transferred to a
Suspense Account.
(c) Any amounts held in the Suspense Account shall be allocated to
the Accounts of Participants as of the next succeeding Valuation Date in
accordance with the allocation formula provided in Section 6.2 on a
first-in, first-out basis. However, this allocation shall only be made
to those Participants who are employed by the Company on that date.
(d) The Suspense Account shall be exhausted before any Company
Contributions or Deferrals shall be allocated to the Accounts of
Participants subsequent to the date on which the remaining excess
described in Paragraph (b) is credited to the Suspense Account.
(e) The Trustee shall segregate any amounts held in the Suspense
Account from other assets of the Plan and may place the cash portions
thereof in an interest-bearing account in any bank or savings and loan
institution, including the Trustee's own banking department (if
applicable). Any amounts held in the Suspense Account shall not
participate in any allocation of Forfeitures, or net income or loss of
other assets of the Trust Fund under Article VI.
(f) In the event the Plan shall terminate at a time when all
amounts in the Suspense Account have not been allocated to the Accounts
of the Participants, the amounts in the Suspense Account shall be applied
as follows:
(i) The amount in the Suspense Account shall first be
allocated, as of the date of the termination of the Plan, to
Participants on the same basis as specified in Paragraph (c) above,
with the allocation to be made to the maximum extent permissible
under the Annual Additions limitations of this Article XV; and
(ii) If after those allocations have been made, any
further amounts remain in the Suspense Account, the residue shall
revert to the Company in accordance with the applicable provisions
of the Code.
ARTICLE XVI
RESTRICTION ON ALIENATION
16.1 General Restrictions Against Alienation. Benefits under the Plan may not
be assigned or alienated. The preceding sentence shall not apply with
respect to a "Qualified Domestic Relations Order" described below.
16.2 Definition. A "Qualified Domestic Relations Order" is a judgment,
decree, or order (including approval of a property settlement agreement)
that--
(a) Creates or recognizes the existence of an Alternate Payee's
right to, or assigns to an Alternate Payee the right to, receive all or a
portion of the benefits payable with respect to a Participant,
(b) Relates to the provision of child support, alimony payments, or
marital property rights to a Spouse, child, or other dependent of a
Participant,
(c) Is made pursuant to a State domestic relations law (including a
community property law), and
(d) Clearly specifies:
(i) The name and last known mailing address (if any) of
the Participant and the name and mailing address of each Alternate
Payee covered by the order (if the Plan Administrator does not have
reason to know that address independently of the order);
(ii) The amount or percentage of the Participant's
benefits to be paid to each Alternate Payee, or the manner in which
the amount or percentage is to be determined;
(iii) The number of payments or period to which the order
applies; and
(iv) Each plan to which the order applies.
For purposes of this Section 16.2, "Alternate Payee" means any Spouse,
former Spouse, child or other dependent of a Participant who is
recognized by a domestic relations order as having a right to receive
all, or a portion of, the benefits payable with respect to the
Participant.
16.3 Impermissible Terms. A domestic relations order is not a Qualified
Domestic Relations Order if it requires--
(a) The Plan to provide any type or form of benefit, or any option
not otherwise provided under the Plan,
(b) The Plan to provide increased benefits (determined on
the basis of actuarial value), or
(c) The payment of benefits to an Alternate Payee that are
required to be paid to another Alternate Payee under a previous Qualified
Domestic Relations Order.
16.4 Special Rule. Notwithstanding any other provisions of the Plan, benefits
payable to an Alternate Payee under the terms of a Qualified Domestic
Relations Order shall be paid immediately in a lump sum unless the terms
of the Qualified Domestic Relations Order provide for another method or
time of distribution, and such other method or time of distribution is
otherwise provided under the Plan.
16.5 Procedures. In the case of any domestic relations order received by the
Plan--
(a) The Plan Administrator shall promptly notify the Participant
and any Alternate Payee of the receipt of the order and the Plan's
procedures for determining the qualified status of domestic relations
orders, and
(b) Within a reasonable period after the receipt of the order, the
Plan Administrator shall determine whether or not the order is a
Qualified Domestic Relations Order and shall notify the Participant and
each Alternate Payee of the determination.
The Plan Administrator shall establish reasonable procedures to determine
the qualified status of domestic relations orders and to administer
distributions under Qualified Domestic Relations Orders.
16.6 Segregation of Funds. During any period in which the issue of whether a
domestic relations order is a Qualified Domestic Relations Order is being
determined (by the Plan Administrator, by a court of competent
jurisdiction, or otherwise), the Plan Administrator shall separately
account for the amounts which would have been payable to the Alternate
Payee during the period if the order had been determined to be a
Qualified Domestic Relations Order.
(a) If within the eighteen (18) month period beginning with the
date on which the first payment would be required to be made under the
domestic relations order, the order (or modification thereof) is
determined to be a Qualified Domestic Relations Order, the Plan
Administrator shall pay the segregated amounts (including any interest
thereon) to the person or persons entitled thereto.
(b) If within the eighteen (18) month period beginning with the
date on which the first payment would be required to be made under the
domestic relations order--
(i) It is determined that the order is not a Qualified
Domestic Relations Order, or
(ii) The issue as to whether the order is a Qualified
Domestic Relations Order is not resolved,
then the Plan Administrator shall pay the segregated amounts (including
any interest thereon) to the person or persons who would have been
entitled to the amounts if there had been no order, or restore the amount
to the Participant's Account, whichever is applicable.
(c) Any determination that an order is a Qualified Domestic
Relations Order that is made after the close of the eighteen (18) month
period shall be applied prospectively only.
16.7 Loans. No loans from the Trust Fund to any Participant, regardless of
whether secured or unsecured, shall be permitted.
ARTICLE XVII
AMENDMENTS
17.1 Amendments. The Company may at any time, and from time to time, amend
the Plan by an instrument in writing executed in the name of the Company
by an officer or officers duly authorized to execute the instrument.
However, except as permitted by law, no amendment shall be made at any
time, the effect of which would be:
(a) To cause any assets of the Trust Fund, at any time prior to the
satisfaction of all liabilities with respect to Participants and their
Beneficiaries, to be used for or diverted to purposes other than--
(i) Providing benefits to the Participants and their
Beneficiaries, and
(ii) Defraying reasonable expenses of administering the
Plan;
(b) To have any retroactive effect so as to decrease the accrued
benefit of any Participant (within the meaning of Section 411(d)(6) of
the Code); or
(c) To increase or alter the responsibilities or liabilities of a
Trustee or an Investment Manager without its written consent.
17.2 Effect of Amendments.
(a) All amendments to the Plan are effective only on the date on
which the amendments are adopted, unless a different effective date is
expressly provided by resolution of the Board of Directors of the
Company, or unless the amendment shall by its own express terms become
effective at another date.
(b) Further, unless and to the extent expressly stated to the
contrary in the terms of any amendment, the amendment shall not be
construed to enlarge the rights of any Participant whose Severance
occurred prior to the effective date of the amendment.
ARTICLE XVIII
MISCELLANEOUS MATTERS
18.1 No Enlargement of Employee Rights.
(a) This Plan is strictly a voluntary undertaking on the part of
the Company and shall not be deemed to constitute a contract between the
Company and any Employee, or to be consideration for, or an inducement
to, or a condition of, the employment of any Employee.
(b) Nothing contained in the Plan shall be deemed to give any
Employee the right to be retained in the employ of the Company or to
interfere with the right of the Company to discharge any Employee at any
time.
(c) No Employee shall have any right to or interest in any assets
of the Plan, other than as specifically provided in this Plan.
18.2 Mailing of Payments.
(a) All payments under the Plan shall be delivered in person or
mailed to the last address of the Participant (or, in the case of the
death of the Participant, to the last address of his Beneficiary).
(b) Each Participant shall be responsible for furnishing the
Investment Advisory Board with his correct current address and the
correct current name and address of his Beneficiary.
18.3 Notices and Communications.
(a) All applications, notices, designations, elections, and other
communications from Participants shall be in writing, on forms prescribed
by the Investment Advisory Board and shall be mailed or delivered to the
office designated by the Investment Advisory Board, and shall be deemed
to have been given when received by the office.
(b) Each notice, report, remittance, statement and other
communication directed to a Participant or Beneficiary shall be in
writing and may be delivered in person or by mail. An item shall be
deemed to have been delivered and received by the Participant three (3)
days after the date when it is deposited in the United States Mail with
postage prepaid, addressed to the Participant or Beneficiary at his last
address of record with the Investment Advisory Board.
18.4 Interpretation.
(a) Article and Section headings are for convenient reference only
and shall not be deemed to be part of the substance of this instrument or
in any way to enlarge or limit the contents of any Article or Section.
(b) Unless the context clearly indicates otherwise, masculine
gender shall include the feminine, the singular shall include the plural,
and the plural shall include the singular.
(c) The provisions of this Plan shall in all cases be interpreted
in a manner that is consistent with this Plan satisfying the applicable
requirements of the Code and ERISA.
18.5 Withholding For Taxes. Any payments from the Plan may be subject to
withholding for taxes as may be required by any applicable federal or
state law.
18.6 Counterparts. This Plan document may be executed in any number of
identical counterparts, each of which shall be deemed a complete original
in itself and may be introduced in evidence or used for any other purpose
without the production of any other counterparts.
18.7 Successors and Assigns. This Plan and the Trust established hereunder
shall inure to the benefit of, and be binding upon, the parties hereto
and their successors and assigns.
Exhibit 23
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CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation
by reference in this registration statement of our reports dated January 30,
1996, included in Fort Howard Corporation's Form 10-K for the year ended
December 31, 1995, and our report dated May 11, 1995, included in Fort Howard
Corporation's Form 11-K for the year ended December 31, 1994, and to all
references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
Milwaukee, Wisconsin
February 5, 1996.
