PAGE 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 11-K
ANNUAL REPORT
Pursuant to Section 15(d) of the
Securities Exchange Act of 1934
For The Fiscal Year Ended December 31, 1993
Commission File No. 1-996
(A) Full title of the plan and the address
of the plan, if different from that of
the issuer named below:
GENERAL SIGNAL CORPORATION
SAVINGS AND STOCK OWNERSHIP PLAN
One High Ridge Park
Stamford, Connecticut 06904
(B) Name of issuer of the securities held
pursuant to the plan and the address
of its principal executive office:
GENERAL SIGNAL CORPORATION
One High Ridge Park
Stamford, Connecticut 06904
<PAGE>
PAGE 2
ITEM 1. FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements: Pages
Report of Independent Auditors 4
Statements of Financial Condition as of
December 31, 1993 and December 31, 1992 5-6
Statements of Income and Changes in
Participants' Equity for the years
ended December 31, 1993 and December
31, 1992 7-8
Notes to Financial Statements 9-19
All schedules are omitted as the required
information is presented in the Financial
Statements.
(b) Exhibits:
4.1 General Signal Corporation Savings and Stock
Ownership Plan as amended and restated April
18, 1994 (filed herewith).
23.1 Consent of Ernst & Young (filed herewith).
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Corporate Pension Board has duly caused this annual
report to be signed by the undersigned thereunto duly authorized.
GENERAL SIGNAL CORPORATION
SAVINGS AND STOCK OWNERSHIP PLAN
BY /s/ Edgar J. Smith, Jr.
Member of the Corporate
Pension Board
DATE: May 11, 1994
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REPORT OF INDEPENDENT AUDITORS
The Corporate Pension Board
General Signal Corporation:
We have audited the accompanying statements of financial condition of
the General Signal Corporation Savings and Stock Ownership Plan as of
December 31, 1993 and 1992, and the related statements of
income and changes in participants' equity for the years then ended.
These financial statements are the responsibility of the Plan's
management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are
free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles
used and significant estimates made by management, as well as evaluating
the overall financial statement presentation. We believe that our audits
provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of the General
Signal Corporation Savings and Stock Ownership Plan at December 31, 1993
and 1992, and the results of its operations and changes in
participants' equity for the years then ended in conformity with generally
accepted accounting principles.
/s/ Ernst & Young
Stamford, Connecticut
March 25, 1994
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<TABLE>
GENERAL SIGNAL CORPORATION SAVINGS AND STOCK OWNERSHIP PLAN
Statement of Financial Condition
December 31, 1993
<CAPTION>
Assets Fidelity Fixed Income General Signal S&P
Puritan Fund Common Stock 500 Equity
Fund Fund Index Fund Total
<S> <C> <C> <C> <C> <C>
Investments, at market:
General Signal Corporation Common Stock,
2,135,440 shares (cost $54,321,249) $ $ $73,405,750 $ $ 73,405,750
Bankers Trust S&P 500 Equity Index Fund,
20,961.65 shares (cost $13,847,792) 20,724,003 20,724,003
Fidelity Puritan Fund
1,649,658.40 shares
(cost $24,825,555) 25,982,120 25,982,120
Guaranteed interest contracts (note 2) 93,238,016 93,238,016
Dividends and interest receivable 2,028,010 2,028,010
Cash and Short Term Investments 4,927,259 18,359 1 4,945,619
Contributions receivable:
Employee 457,150 253,606 613,133 190,052 1,513,941
Employer 0 0 765,422 0 765,422
Other assets 12,089 59,238 148,695 13,298 233,320
TOTAL ASSETS $26,451,359 $100,506,129 $74,951,359 $20,927,354 $222,836,201
Liabilities and Participants' Equity
Liabilities:
Advances from General Signal 70,000 490,000 600,000 80,000 1,240,000
Distributions payable 1,521,319 5,225,429 2,296,092 982,872 10,025,712
Due to/(from) other funds (1,523,873) 1,566,268 170,677 (213,072) 0
Other liabilities 18,336 18,336
Participants' equity 26,383,913 93,224,432 71,866,254 20,077,554 211,552,153
TOTAL LIABILITIES &
PARTICIPANTS' EQUITY: $26,451,359 $100,506,129 $74,951,359 $20,927,354 $222,836,201
</TABLE>
See accompanying notes to financial statements.
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<PAGE>
PAGE 6
<TABLE>
GENERAL SIGNAL CORPORATION SAVINGS AND STOCK OWNERSHIP PLAN
Statement of Financial Condition
December 31, 1992
<CAPTION>
Assets Fidelity Fixed Income General Signal S&P
Puritan Fund Common Stock 500 Equity
Fund Fund Index Fund Total
<S> <C> <C> <C> <C> <C>
Investments, at market:
General Signal Corporation Common Stock,
2,257,428 shares (cost $53,385,852) $ -- $ -- $68,851,554 $ --- $ 68,851,554
Bankers Trust S&P 500 Equity Index Fund,
24,489.83 shares (cost $14,827,774) -- -- -- 21,740,393 21,740,393
Fidelity Puritan Fund, 921,823.89 shares
(cost $12,744,060) 13,587,684 -- -- --- 13,587,684
Guaranteed interest contracts (note 2) -- 113,456,780 -- --- 113,456,780
Dividends and interest receivable -- 1,427,927 507,864 --- 1,935,791
Cash 4,516 23,317 32 4,517 32,382
Contributions receivable:
Employee 165,098 808,982 495,295 181,608 1,650,983
Employer 893,740 893,740
Other assets 12,083 59,205 36,248 13,291 120,827
TOTAL ASSETS $ 13,769,381 $ 115,776,211 $ 70,784,733 $ 21,939,809 $ 222,270,134
Liabilities and Participants' Equity
Liabilities:
Advances from General Signal $ 70,000 $ 490,000 $ 600,000 $ 80,000 $ 1,240,000
Distributions payable 336,699 3,553,835 1,649,880 703,881 6,244,295
Due to/(from) other funds (2,216,972) 3,075,863 393,193 (1,252,084) -0-
Participants' equity 15,579,654 108,656,513 68,141,660 22,408,012 214,785,839
TOTAL LIABILITIES AND
PARTICIPANTS' EQUITY $ 13,769,381 $ 115,776,211 $ 70,784,733 $ 21,939,809 $ 222,270,134
</TABLE>
See accompanying notes to financial statements.
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PAGE 7
<TABLE>
GENERAL SIGNAL CORPORATION SAVINGS AND STOCK OWNERSHIP PLAN
Statement of Income and Changes in Participants' Equity
For the fiscal year ended December 31, 1993
<CAPTION>
Fidelity Fixed Income General Signal S&P
Puritan Fund Common Stock 500 Equity
Fund Fund Index Fund Total
<S> <C> <C> <C> <C> <C>
Investment Income:
Interest $ 23 $ 6,946,359 $ 1,996 $ 32 $ 6,948,410
Dividends 970,607 0 1,539,999 8 2,510,614
Realized gain/(loss) on investments
(note 4) 2,511,968 0 4,834,502 2,249,839 9,596,309
Increase/(decrease) in unrealized
appreciation (note 5) 312,940 0 3,618,799 (36,408) 3,895,331
3,795,538 6,946,359 9,995,296 2,213,471 22,950,664
Contributions (notes 2 and 3):
Participating employees 2,224,560 8,356,974 5,574,474 2,114,542 18,270,550
Employer-net of forfeitures
of $172,221 0 0 9,073,707 0 9,073,707
2,224,560 8,356,974 14,648,181 2,114,542 27,344,257
Interfund transfers 10,586,149 (5,495,864) (4,454,298) (635,987) 0
Withdrawals by participating employees
(note 2) (4,284,659) (18,871,099) (10,992,012) (3,305,437) (37,453,207)
Loans to participants (note 2) (201,367) (986,842) (161,209) (113,580) (1,462,998)
Loan repayments 157,897 693,956 402,201 172,513 1,426,567
Assets transferred from prior trustee 71,810 75,066 32,759 49,688 229,323
Assets transferred to successor trustee (1,545,669) (6,094,549) (5,746,324) (2,806,366) (16,192,908)
Expenses 0 (56,082) 0 (19,302) (75,384)
Net changes in participants' equity $10,804,259 $(15,432,081) $ 3,724,594 $(2,330,458) $ (3,233,686)
Participants' equity, December 31, 1992 15,579,654 108,656,513 68,141,660 22,408,012 214,785,839
Participants' equity, December 31, 1993 $26,383,913 $ 93,224,432 $71,866,254 $20,077,554 $211,552,153
</TABLE>
See accompanying notes to financial statements.
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PAGE 8
<TABLE>
GENERAL SIGNAL CORPORATION SAVINGS AND STOCK OWNERSHIP PLAN
Statement of Income and Changes in Participants' Equity
For the fiscal year ended December 31, 1992
<CAPTION>
Fidelity Fixed Income General Signal S&P
Puritan Fund Common Stock 500 Equity
Fund Fund Index Fund Total
<S> <C> <C> <C> <C> <C>
Investment Income:
Interest $ 23 $ 8,074,974 $ 5,936 $ 34 $ 8,080,967
Dividends 626,758 -- 1,969,302 -- 2,596,060
Realized gain/(loss) on investments
(note 4) 630,071 -- 1,904,039 900,295 3,434,405
Increase/(decrease) in unrealized
appreciation (note 5) 365,106 -- 6,865,767 733,703 7,964,576
1,621,958 8,074,974 10,745,044 1,634,032 22,076,008
Contributions (notes 2 and 3):
Participating employees 1,783,603 10,606,844 4,814,373 1,920,525 19,125,345
Employer-net of forfeitures 10,000 210,000 9,172,812 30,000 9,422,812
of $217,569
1,793,603 10,816,844 13,987,185 1,950,525 28,548,157
Interfund transfers 5,284,929 (4,822,256) (3,650,147) 3,187,474 --
Withdrawals by participating employees
(note 2) (1,113,258) (13,978,765) (7,388,329) (2,964,518) (25,444,870)
Loans to participants (note 2) (149,578) (1,399,950) (204,723) (164,198) (1,918,449)
Loan repayments 96,843 667,235 320,371 122,676 1,207,125
Assets transferred from prior trustee
-- -- -- -- --
Assets transferred to successor trustee
-- -- -- -- --
Expenses -- (22,500) -- (22,818) (45,318)
Net changes in participants' equity 7,534,497 (664,418) 13,809,401 3,743,173 24,422,653
Participants' equity, December 31, 1991 8,045,157 109,320,931 54,332,259 18,664,839 190,363,186
Participants' equity, December 31, 1992 $15,579,654 $ 108,656,513 $ 68,141,660 $22,408,012 $ 214,785,839
</TABLE>
See accompanying notes to financial statements.
-8-
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PAGE 9
GENERAL SIGNAL CORPORATION
SAVINGS AND STOCK OWNERSHIP PLAN
Notes to Financial Statements
1. Summary of Significant Accounting Policies
Investments
The market values of equity securities owned by the General Signal Corporation
Savings and Stock Ownership Plan (the "Plan") are based upon the closing
market quotation on December 31 of the respective plan year. Gains and
losses from the distribution and disposition of equity securities are
determined based upon the average cost of the applicable securities.
The investments of the fixed income fund are currently invested in
investment contracts issued by various insurance companies and banks, as
well as in U. S. Government mortgage-backed securities. (see note 2)
These investments are valued at historical costs.
Basis of Accounting
The financial statements have been prepared on the accrual basis of
accounting.
Withdrawals and Loans
Withdrawals and loans are payable as of the Valuation Date (March
31, June 30, September 30 or December 31) for all withdrawal and
loan requests received at least 15 days prior to the Valuation Date
(see note 2). Withdrawal and loan requests received in October,
November and December of 1993 became payable as of December 31,
1993 in the aggregate amount of $10,025,712.
2. Plan Description
The purpose of the Plan is to encourage employees to make and
continue careers with the Employer by providing eligible employees
with a vehicle to save part of their income on a regular and long-
term tax-deferred basis, to strengthen their interest in the
Corporation and its profitability by the investment of Employer
contributions in Corporation Common Stock, and to provide a
supplemental source of retirement income. As used in the Plan, the
term "Employer" means the Corporation and any other organization
which is designated by appropriate action of the Corporation's
Corporate Pension Board (the "Board") as a participating employer
under the Plan, and which adopts the Plan by appropriate action of
its board of directors or other governing body, as applicable.
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PAGE 10
The Plan is an individual account plan under which a participant's
benefits are based on amounts contributed to the Plan by the
participant and by the Employer on his behalf, as adjusted by
income, expenses, gains and losses which may be allocated to such
participant's accounts under the Plan.
The Plan is intended to comply with the provisions of Section 404(c) of
the Employee Retirement Income Security Act of 1974, as amended and that
as a result the fiduciaries of the Plan may be relieved of liability for
any losses which result from the investment instructions given by a
participant.
Tax Deferred and Taxed Contributions - Each employee who elects to
participate in the Plan (a "Member") may elect to have his Employer
make contributions to the Plan on his behalf from such Member's
total earnings paid by an Employer ("Compensation") by a periodic
payroll reduction in an amount equal to at least 3% but not more
than 17% of his Compensation (in whole percentages), as determined
by the Member ("Tax Deferred Contributions").
A Member may also elect to make contributions to the Plan on an
after-tax basis ("Taxed Contributions") from his Compensation by
periodic payroll deduction in an amount not to exceed 10% of his
Compensation (in whole percentages), subject to a minimum of 3% of
Compensation for a Member who has not elected any Tax Deferred
Contributions. The aggregate percentage of Tax Deferred Contribu-
tions and Taxed Contributions may not exceed 17% of the Member's
Compensation for any period. Tax Deferred Contributions and Taxed
Contributions will hereinafter be collectively referred to as
"Member Elected Contributions".
A Member's Tax Deferred Contributions may not exceed $7,000
(subject to cost-of-living adjustment-$8,994 for 1993 and $9,240
for 1994) for any calendar year. To the extent an election of
Tax Deferred Contributions would exceed this limitation for
any Member, it shall automatically be treated as an election of
Taxed Contributions (subject to the 10% limitation on Taxed
Contributions).
A Member may discontinue or change his rate of Member Elected
Contributions as of any quarterly Enrollment Date on at least 15
days prior written notice to his Employer. A Member may not have
discontinued contributions made up, but may resume having contribu-
tions made on his behalf as of any quarterly Enrollment Date by
filing the appropriate enrollment application.
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PAGE 11
Matching Contributions - On behalf of each Member in its employ who
has completed one year of Continuous Employment and is having Tax
Deferred Contributions made to this Plan or has contributed Tax
Deferred Contributions on a year to date basis equal to 3% of his
Compensation for the entire Plan Year, each Employer will make
matching contributions ("Matching Contributions")to the Plan for
each month, out of current or accumulated earnings and profits,
equal to either 4% of each such Member's Compensation if such
Member elected to invest at least 3% of such Member's Compensation
for such period in the Company Stock Fund or 3% of each such
Member's Compensation if such Member did not elect to invest at
least 3% of such Member's Compensation for such period in the
Company Stock Fund, less any amount of forfeitures then to be
applied to reduce such Matching Contributions.
The portion of the Plan consisting of Matching Contributions (and
any income, expenses, gains and losses allocable thereto) is
intended to constitute a stock bonus plan under Section 401(a) of
the Code which qualifies as an Employee Stock Ownership Plan
("ESOP") under Section 4975(e)(7) of the Internal Revenue Code
(the "Code"). Accordingly, Matching Contributions shall be
invested in Corporation Common Stock but may be held in invest-
ments of a short-term nature pending investment in Corporation
Common Stock. Certain additional provisions set forth in the
Plan will apply if the Plan incurs an "Acquisition Loan" to acquire
shares of Corporation Common Stock.
Member Elected Contributions and Matching Contributions are paid
monthly to The Chase Manhattan Bank, N.A. (the "Trustee"). The
Member Elected Contributions will be invested in one or more
Investment Funds which are made available from time to time by the
Board for such purpose as selected by the Member in 25% increments;
provided, however, that if the Member elects to invest 3% of such
Member's Compensation in the Company Stock Fund, the applicable 25%
increments shall apply to any additional Member Elected Contribu-
tions. The current Investment Funds available are as follows:
(A) Fidelity Puritan Fund - The Fidelity Puritan Fund is primarily
an income fund with a secondary emphasis on growth. The fund's
investment emphasis is on producing income while preserving the
capital of its investors. However, since the portfolio is
comprised of common and preferred stocks, as well as bonds, the
fund may also obtain growth of capital. The Fidelity Puritan Fund
is a mutual fund managed by Fidelity Management & Research Company.
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PAGE 12
(B) Fixed Income Fund - The purpose of the Fixed Income Fund is to
provide a way to achieve steady income with Member Elected Contributions.
As of August 6, 1992, this fund is managed by Bankers Trust Investment
Management Group ("BTIMG"). Due to the size of assets managed and
experience in managing similar funds, BTIMG is able to obtain competitive
rates on a daily basis, thoroughly research and monitor the credit quality
of the issuers and provide adequate liquidity and diversification of the
portfolio. The fund is currently invested in investment contracts issued
by various insurance companies and banks, as well as in U.S. Government
mortgage-backed securities. These investments are typically unsecured
contractual obligations under which the issuer agrees to repay principal
and accrued interest over a specified period of time. The terms, interest
rates and the duration of the investment contracts will vary from time to
time depending on the terms negotiated and on prevailing interest rates.
The interest rate earned by Members is a composite reflecting the weighted
average of all investments in the Fixed Income Fund, and it changes
quarterly. While the contracts provide for the return of principal and a
fixed rate of interest for a specified period of time, the Corporation has
no control over the investment policies or fund management of the
institutions and can assume no responsibility for any losses a Member may
experience by investing in the Fixed Income Fund. Therefore, the
creditworthiness of each issuer should be considered in the evaluation of
this fund.
The Plan has investments in guaranteed interest contracts with the
following companies at December 31, 1993 and December 31, 1992:
December 31, December 31,
1993 1992
CNA Ins. Co. $ 5,814,877 $ 19,680,097
Metropolitan Life 11,024,216 11,022,264
Mutual Benefit Life 20,278,355 20,580,941
Principal Mutual 7,188,363 6,734,611
Prudential Asset Management 3,332,946 7,420,838
Prudential Insurance Co. 11,028,468 10,960,045
State Mutual 10,613,983 10,613,983
Union Bank of Switzerland 23,956,808 26,444,001
Investments in guaranteed
interest contrats $ 93,238,016 $113,456,780
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PAGE 13
(C) Company Stock Fund - The Company Stock Fund is available for
employees who choose to invest in shares of General Signal
Corporation Common Stock. The purpose of this fund is to provide
employees the opportunity to invest directly in the Corporation and
share in its future. Member Elected Contributions and dividends
will be invested in whole and fractional shares of Corporation
Common Stock. Shares will be purchased on the open market or
directly from the Corporation out of its treasury shares at the
fair market value of the stock under the direction of the Trustee.
(D) S&P 500 Equity Index Fund - The assets of the S&P 500 Equity
Index Fund are invested in a Standard & Poor's 500 Equity Index
Fund managed by Bankers Trust Company. The objective of the fund
is to provide investment results which approximate the overall
performance of the common stocks included in the Standard and
Poor's Composite Index of 500 stocks.
The Trustee or the investment manager, as the case may be, may in
its discretion temporarily invest any part of any Fund in selected
short-term investments either through direct investment or through
the medium of a commingled fund or funds. Amounts held in the
Trust from time to time pending investment in the applicable
investment fund, or pending payment of a withdrawal or distribution
may be held by the Trustee uninvested or may be invested in
short-term instruments at the direction of the Corporation.
Upon 15 days advance written notice, a participating employee may on
the applicable January 1, April 1, July 1, or October 1, change the
allocation of his future contributions, and may elect to transfer his
Member Elected Contributions from one investment option to another.
Employer contributions are invested in General Signal Common Stock. Once
an employee attains age 55 and has completed five years of continuous
employment, he may transfer (in 25% increments) Matching Contributions
to the three other investment funds.
The number of participants in each investment fund at December 31,
1993 was as follows:
Fidelity Puritan Fund - 2,485
Fixed Income Fund - 5,686
Company Stock Fund- 7,210
S&P 500 Equity Index Fund - 2,196
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PAGE 14
Withdrawals are provided for in the following order:
Under certain circumstances (as described below), a Member may make
withdrawals from his Accounts while he is still an employee. Each
Member is entitled to two withdrawal requests during any calendar
year. All withdrawals must be made as of the Valuation Date which
follows by at least 15 days the date on which the Board receives
notice of the withdrawal request. Payment to a Member will occur
approximately 6 weeks after the Valuation Date. No investment
experience will be applied to the withdrawal after the Valuation
Date.
Withdrawals made prior to termination of employment with the
Employer will be charged (i) first, to the Member's Taxed Contribu-
tion Account; (ii) second, the Member's Matured Stock Account
(vested portion of Matching Contributions), provided that withdraw-
al of amounts attributable to Matching Contributions made less than
24 months prior to the effective date of the withdrawal may not be
made by one who has not been a Member for at least 60 months prior
to that effective date; and (iii) third, to the Member's Tax
Deferred Contribution Account but only if the withdrawal is on
account of hardship and is approved by the Board. However, only
the amount of the Tax Deferred Contributions (but no earnings
thereon) may be included in a hardship withdrawal on or after
January 1, 1989. The withdrawal may be authorized only to the
extent necessary to satisfy the hardship.
In addition, pursuant to rules and regulations established by the
Board, a Member may obtain a loan from the Plan which shall be
charged against such Member's Accounts. The amount of such a loan
may not in the aggregate exceed the balance in the Member's
Accounts exclusive of amounts attributable to Matching Contribu-
tions made on his behalf (whether vested or unvested). The Board
shall prescribe the interest rate charged on loans, the maximum
loan term, the minimum and maximum amounts of loans, the security
for loans (which shall include the value of a Member's Accounts),
the method and timing of repayment and other requirements as it
shall deem appropriate, subject to Internal Revenue Code and
Department of Labor regulations. Loans shall be available to all
Members on a non-discriminatory basis.
Upon a Member's termination of service by reason of retirement,
after completion of at least five years of continuous employment,
disability or death, the balance of his Accounts will be distribut-
ed to him (or in the case of his death, to his beneficiary) as soon
as practicable following the Valuation Date coincident with or next
following such termination of service.
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Page 15
The payment of benefits shall commence not later than April 1 of
the calendar year next following the calendar year in which the
Member attains age 70-1/2.
Other Termination of Employment - If a Member terminates employment
with the Employer for any reason other than death, disability or
retirement, and prior to completion of five years of continuous
employment, he must elect either:
(A) to make one last in-service withdrawal of all or part of his
Taxed Contribution Account and his Matured Stock Account and to
leave the balance of his Accounts in the Plan until his rights to
all Matching Contributions have become nonforfeitable;
(B) to receive the value of all of his Accounts (other than his
Matching Contribution Account), and to forfeit his unvested
Matching Contribution Account subject to the Member's right to
restore such forfeited amount in accordance with the Plan; or
(C) to defer receipt of all amounts until his rights to all
Matching Contributions credited to his Matching Contribution
Account on the date of his termination of employment become
nonforfeitable.
A Member electing to defer receipt of his Accounts at termination
under (A) or (C) above may nevertheless elect at some subsequent
date, before all Matching Contributions have become nonforfeitable,
to receive the value of all his Accounts together with all Matching
Contributions which at that date have become nonforfeitable in
accordance with (B) above.
If the amount credited to a Member's Accounts exceeds $3,500, the
distribution will not commence prior to the Member's attainment of
age 62 unless the Member consents to the distribution.
If a Member's employment with the Employer terminates and he is not
reemployed before incurring five consecutive one-year breaks in
service, the balance of his Matching Contributions Account will be
forfeited as of December 31 of the calendar year in which occurs
the fifth such consecutive one-year break in service. Amounts
forfeited on account of termination of employment prior to vesting
will be applied, as soon as practicable, to reduce the Employer's
Matching Contributions to the Plan.
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Page 16
3. Vesting Rights of Members
The portion of a Member's account which consists of his contribu-
tions and the net investment income allocated thereto is 100%
vested at all times. The portion of a Member's account which
consists of Matching Contributions and the net investment income
allocated thereto becomes vested after an employee completes 5
years of continuous employment, attains age 55 and terminates
employment, becomes disabled or dies or after the end of the third
full calendar year following the calendar year for which such
contributions were made. Members will be fully vested in the event
the Plan is terminated.
4. Realized Gain (Loss) on Sales of Investments
YEAR ENDED DECEMBER 31
1993 1992
Fidelity Puritan Fund
Proceeds received on sales $ 6,827,314 $ 1,422,151
Cost of shares sold 4,315,346 792,080
Realized gain/(loss) $ 2,511,968 $ 630,071
General Signal Common Stock
Proceeds received on sales $20,797,149 $ 8,626,767
Cost of shares sold $15,962,646 $ 6,722,728
Realized gain/(loss) $ 4,834,502 $ 1,904,039
S&P 500 Equity Index Fund
Proceeds received on sales $ 7,130,466 $ 3,063,513
Cost of shares sold $ 4,880,627 $ 2,163,218
Realized gain/(loss) $ 2,249,839 $ 900,295
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PAGE 17
5. Unrealized Appreciation (Depreciation) of Investments
YEAR ENDED DECEMBER 31
1993 1992
Fidelity Puritan Fund
Unrealized appreciation
(depreciation)
at: Beginning of fiscal year $ 843,625 $ 478,519
End of fiscal year 1,156,565 843,625
Increase/(decrease) $ 312,940 $ 365,106
General Signal Common Stock
Unrealized appreciation
(depreciation)
at: Beginning of fiscal year $15,465,702 $ 8,599,935
End of fiscal year 19,084,501 15,465,702
Increase/(decrease) $ 3,618,799 $ 6,865,767
S&P 500 Equity Index Fund
Unrealized appreciation
(depreciation)
at: Beginning of fiscal year $ 6,912,619 $ 6,178,916
End of fiscal year 6,876,211 6,912,619
Increase/(decrease) $ (36,408) $ 733,703
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<PAGE>
PAGE 18
6. Federal Income Taxes
The Plan has secured a favorable determination as a qualified plan
under Section 401(a) of the Code and that the Trust created under
the Plan is exempt from Federal income tax under Section 501(a) of
the Code. The participating employees are not subject to Federal
Income Tax on investment income or on the Tax Deferred Contribu-
tions and Matching Contributions until such funds are distributed
from the Plan.
7. Administrative Costs
All costs of administering the Plan are borne by the Corporation on
behalf of the Plan; provided, however, that on and after April 1,
1991, that all investment expenses related to each applicable
investment fund will be paid pro rata from the accounts of each
Member's share of such investment fund.
8. Investment in Mutual Benefit Life Insurance Company Guaranteed
Investment Contract
In 1991, the Plan entered into a Guaranteed Investment Contract
("GIC") with Mutual Benefit Life Insurance Company (Mutual Benefit).
The GIC was scheduled to begin payouts of interest on
March 1, 1992 and was to mature in three installments (September
1993, March 1994 and September 1994).
On July 16, 1991, Mutual Benefit was placed in rehabilitory
conservatorship by a New Jersey state court, which resulted in a freeze on
withdrawals. This resulted from Mutual Benefit's request to the New
Jersey State Insurance Commissioner to place the company in a
"rehabilitation" status following unusually large and unexpected demands
for cash withdrawals. Mutual Benefit requested this action to protect
its assets from the continued drain of these withdrawals. Mutual
Benefit has continued to make regular payments to policy-holders and to
pay death benefits. However, group annuity payments, which included the
Plan's GIC, have been temporarily suspended. Upon the scheduled payment
of interest or principal on its existing GIC contracts, Mutual Benefit has
been retaining the policy proceeds and declaring a "rollover" rate on such
funds.
-18-
<PAGE>
Page 19
On January 28, 1994, the Superior Court of New Jersey issued an order
approving the final Plan of Rehabilitation for Mutual Benefit. Each contract
has been restructured and transferred to MBL Life Assurance Corporation.
Upon the plan, contractholders may elect to receive their contract value less
a 45% penalty in 1994. Alternatively, contractholders may elect to receive
their contract value plus interest (at a rate which will depend on the
performance of underlying assets) over a five year period beginning in the
year 2000. In addition, Mutual Benefit may defer distribution of the
contract value for an additional seven years if necessary to satisfy
obligations to all contractholders. Since the rehabilitation plan provides
for the payment of 100% of the principal amount of the contract and it is the
plan sponsor's current intention to select the option to continue to hold the
contract to maturity, the contract is recorded at 100% of its contract value
in the financial statements.
9. Amendment
The Plan was amended effective as of January 1, 1994 to comply with
the compensation limit of $150,000 under Section 401(a)(17) of the
Internal Revenue Code.
-19-
<PAGE>
PAGE 1
EXHIBIT 23.1
Consent of Independent Auditors
The Corporate Pension Board
General Signal Corporation:
We consent to the incorporation by reference in the Registration Statement
(Form S-8 No. 33-46613) pertaining to the General Signal Corporation
Savings and Stock Ownership Plan and related Prospectus of our
report dated March 25, 1994, with respect to the financial statements of
the General Signal Corporation Savings and Stock Ownership Plan included
in this Annual Report (Form 11-K) for the year ended December 31, 1993.
/s/ Ernst & Young
Stamford, Connecticut
May 10, 1994
<PAGE>
GENERAL SIGNAL CORPORATION
SAVINGS AND STOCK OWNERSHIP PLAN
As Amended and Restated April 18, 1994 42294
<PAGE>
TABLE OF CONTENTS
ARTICLE PAGE
I PURPOSE. . . . . . . . . . . . . . . . . . . . . I-1
II DEFINITIONS. . . . . . . . . . . . . . . . . . . II-1
III ELIGIBILITY AND MEMBERSHIP . . . . . . . . . . . III-1
IV MEMBER ELECTED CONTRIBUTIONS . . . . . . . . . . IV-1
V EMPLOYER CONTRIBUTIONS . . . . . . . . . . . . . V-1
VI MEMBERS' ACCOUNTS. . . . . . . . . . . . . . . . VI-1
VII INVESTMENT ELECTIONS . . . . . . . . . . . . . . VII-1
VIII VESTING. . . . . . . . . . . . . . . . . . . . . VIII-1
IX IN SERVICE WITHDRAWALS . . . . . . . . . . . . . IX-1
X DISTRIBUTIONS AT TERMINATION OF EMPLOYMENT . . . X-1
XI DISTRIBUTION OF EXCESS DEFERRALS . . . . . . . . XI-1
XII DISTRIBUTION OF EXCESS CONTRIBUTIONS . . . . . . XII-1
XIII DISTRIBUTION OF EXCESS AGGREGATE . . . . . . . . XIII-1
CONTRIBUTIONS
XIV APPLICATION OF FORFEITURES . . . . . . . . . . . XIV-1
XV TRUST. . . . . . . . . . . . . . . . . . . . . . XV-1
XVI ADMINISTRATION . . . . . . . . . . . . . . . . . XVI-1
XVII APPROVAL BY THE INTERNAL REVENUE SERVICE . . . . XVII-1
XVIII GENERAL PROVISIONS . . . . . . . . . . . . . . . XVIII-1
XIX AMENDMENT, TERMINATION AND MERGER. . . . . . . . XIX-1
XX TRANSFERS OF ACCOUNTS FROM OTHER PLANS . . . . . XX-1
XXI TOP-HEAVY PROVISIONS . . . . . . . . . . . . . . XXI-1
<PAGE>
ARTICLE I
PURPOSE
1.1 The purpose of the General Signal Corporation Savings and Stock Ownership
Plan is to encourage employees to make and continue careers with General
Signal Corporation and its participating subsidiaries by providing
eligible employees with an efficient and convenient way to save part of
their income on a regular and long term tax-preferred basis, to strengthen
their interest in the Company and its profitability by the investment of
all Employer contributions and all Member Elected Contributions which the
Member so directs in the Common Stock of General Signal Corporation, and
to provide a supplemental source of retirement income.
1.2 The Plan was established effective January 1, 1976, and was amended from
time to time thereafter. The provisions of this restated Plan apply to
all contributions made under the Plan with respect to all payrolls paid on
or after this restatement. The provisions of the Plan as in effect from
time to time prior to this restatement will continue to apply to all
contributions made with respect to prior years, unless otherwise
specifically provided.
1.3 The Plan as amended and restated and its related Trust are intended to
qualify as a plan and trust which meet the requirements of Sections
401(a), 401(k) and 501(a) of the Internal Revenue Code of 1986, as from
time to time amended.
<PAGE>
ARTICLE II
DEFINITIONS
2.1 When used in the Plan, the following terms, when capitalized, have the
meanings set forth below:
(a) "Accounts" means the separate accounts maintained by the Board on
behalf of each Member, pursuant to Section 6.1, to reflect the
Member's interest in the Trust Fund.
(b) "Act" means the Employee Retirement Income Security Act of 1974, as
from time to time amended.
(c) "Beneficiary" means the person or persons designated by the Member
or otherwise determined in accordance with Section 18.8.
(d) "Board" means the Corporate Pension Board appointed to administer
the Plan in accordance with Article XVI.
(e) "Board of Directors" means the Board of Directors of the Company.
(f) "Code" means the Internal Revenue Code of 1986, as from time to time
amended. References to specific sections of the Code are deemed to
be references to any comparable section or sections of any future
legislation that amends, supplements or supersedes such sections.
(g) "Company" means General Signal Corporation, a New York Corporation.
(h) "Compensation" means the amount which an Employee receives as salary
from the Employer including management incentive compensation, sales
incentives and commissions, overtime pay, vacation pay, holiday pay,
<PAGE>
night shift bonus, as reported for federal income tax purposes, and
before any reduction for Tax Deferred Contributions, but excluding
any payments under the Company's stock option plans or Long Term
Incentive Compensation Plan, moving and living allowances,
retainers, any special payments made for services performed outside
his regular duties and other special payments. Effective January 1,
1994, Compensation for any calendar year shall be limited to
$150,000 (or such larger amount as may be determined by the Internal
Revenue Service).
(i) "Continuous Employment" means the following:
(1) Continuous Employment is the number of full years, completed
months and days of service with the Controlled Group from
the Employee's original date of hire to his severance from
service date, including periods of layoff, leave of absence
or other temporary breaks in service not in excess of 12
complete months. For this purpose, an Employee's "original
date of hire" is the date on which he first performs an hour
of service for which he is entitled to payment for the
performance of duties for an Employer or a member of the
Controlled Group; an Employee's "severance from service
date" is the earlier of the date on which the Employee
quits, retires, is discharged, or dies, or the first
anniversary of the first date of absence for any other
reason (but only if the Employee returns to active
employment within the authorized period of time). In
determining whether an Employee has incurred a severance
from service date, an absence from work for any period not
in excess of 12-consecutive months which begins on or after
January 1, 1985 (i) by reason of the pregnancy of the
Employee, (ii) by reason of the birth of a child of the
<PAGE>
Employee, (iii) by reason of the placement of a child with
the Employee in connection with the adopting of such child
by such Employee, or (iv) for purposes of caring for such
child for a period beginning immediately following such
birth or placement, shall be treated as Continuous
Employment for this purpose.
(2) Continuous Employment will be preserved during the first 12
complete months following the last day of active employment,
but not thereafter, and only if the Employee returns to
active employment within the authorized period of time.
(j) "Controlled Group" means the controlled group of corporations, as
defined in Section 1563(a) of the Code, determined without regard to
Section 1563(a)(4) and 1563(e)(3)(c), of which the Company or an
Employer is a member.
(k) "Disability" means a Member's physical or mental incapacity which
continues for a period of 6 consecutive months and would entitle him
to benefits under his Employer's disability plan, or for which
disability benefits under the Social Security Act are payable.
(l) "Effective Date" means January 1, 1976.
(m) "Employee" means each person who is employed by an Employer but does
not include:
(i) a person who is neither a citizen nor a resident of the
United States and who receives no earned income from any
Employer which constitutes income from sources within the
United States,
<PAGE>
(ii) any employee of an organization who becomes employed by an
Employer as a result of the acquisition of that organization
by the Employer, unless and until the Board otherwise
determines (for purposes of this Plan, the date of the
acquisition will be considered the employee's date of hire
unless the Board determines otherwise),
(iii) any person included in a unit of employees who are covered
by a collective bargaining agreement which does not
expressly provide for participation in this Plan, or
(iv) a leased employee (as defined in Section 414(n) of the Code;
provided, however, that if a leased employee becomes an
Employee, prior service as a leased employee shall be
recognized for eligibility and vesting purposes.
(n) "Employer" means the Company or any of its subsidiaries or affiliates
which may elect to participate in the Plan with the consent of the Board.
(o) "Enrollment Date" means January 1, 1976, or the first day of any calendar
quarter thereafter.
(p) "Highly Compensated Employee" means an individual described in Section
414(q) of the Code.
(q) "Investment Funds" means:
(1) The "Company Stock Fund" which is a fund for the investment by the
Trustee of Matching Contributions and designated Member Elected
Contributions in Stock, and
(2) Such other funds which may be established from time to time by the
Board pursuant to Section 7.2 and the Trust Agreement for the
investment of Member Elected Contributions.
<PAGE>
(r) "Matching Contributions" means the contributions made by the Employers
pursuant to Section 5.1. The portion of the Plan consisting of Matching
Contributions (as adjusted for earnings and losses attributable thereto)
constitutes an employee stock ownership plan as defined in Section
4975(e)(7) of the Code and a stock bonus plan as described in Section
401(a) of the Code. Such portion of this Plan is hereinafter referred to
as the "ESOP". The assets of the ESOP shall be invested primarily in
qualifying employer securities as defined by Section 4975(e)(8) of the
Code.
(s) "Member" means an Employee who has satisfied the requirements for
membership in the Plan specified in Article III. An individual will
continue to be considered a Member until all Accounts maintained on his
behalf have been either distributed or forfeited.
(t) "Member Elected Contributions" means the Tax Deferred Contributions and
Taxed Contributions which a Member elects to have made under Article IV.
(u) "Plan" means this General Signal Corporation Savings and Stock Ownership
Plan as it may be amended from time to time.
(v) "Plan Year" means (i) the calendar year beginning on the Effective Date
and each calendar year thereafter prior to January 1, 1989, (ii) the
period January 1, 1989 through November 30, 1989 (iii) commencing December
1, 1989 the 12-month period commencing on each December 1 and ending on
the succeeding November 30 until November 30, 1991, (iv) the period
December 1, 1991 through December 31, 1991 and (v) commencing January 1,
1992, the calendar year, and each calendar year thereafter.
<PAGE>
(w) "Retirement" means the Member's termination of service for any reason with
the Controlled Group on or after age fifty-five (55).
(x) "Stock" means the Common Stock, par value of $1.00 per share, of the
Company.
(y) "Tax Deferred Contributions" means contributions made under Section 4.1 of
this Plan at a Member's election pursuant to Section 401(k) of the Code
and which, as to a Member, are considered tax deferred under Section
401(k) of the Code, but in an amount not to exceed $7,000 (as adjusted
under Section 402(g) of the Code) or such greater amount which may be
permitted to be contributed to the Plan on a tax deferred basis under a
qualified cash or deferred arrangement under Section 401(k) of the Code.
(z) "Taxed Contributions" means Member contributions made under this Plan
which do not qualify for deferral under Section 401(k) of the Code.
(aa) "Trust Agreement" means the instrument or instruments executed between the
Company or the Board and the Trustee or Trustees named therein which
provides for the receiving, holding, investing, and disposing of the Trust
Fund.
(bb) "Trust Fund" means the assets of the Plan held by the Trustee or Trustees.
(cc) "Trustee" means the trustee or trustees at any time acting under the Trust
Agreement or Trust Agreements.
(dd) "Valuation Date" means the last business day of any calendar quarter on
which the New York Stock Exchange is open for trading.
<PAGE>
2.2 Gender. Except when otherwise indicated by the context, any masculine
terminology also includes the feminine.
<PAGE>
ARTICLE III
ELIGIBILITY and MEMBERSHIP
3.1 Eligibility. As of any Enrollment Date the individuals who are eligible
to participate in this Plan and become Members are all those who:
(a) are Employees and
(b) are receiving Compensation.
3.2 Membership. An eligible Employee can become a Member on any Enrollment
Date only if:
(a) he has elected to have either Tax Deferred Contributions or Taxed
Contributions made to the Plan as specified in Article IV,
(b) he has signed the enrollment form prescribed by the Board and filed
it with his Employer at least fifteen (15) days prior to his
applicable Enrollment Date, and
(c) he is still an Employee and receiving Compensation on his Enrollment
Date.
<PAGE>
ARTICLE IV
MEMBER ELECTED CONTRIBUTIONS
4.1 Tax Deferred Contributions. A Member, unless he ceases to be an Employee,
may elect to defer each pay period an amount equal to at least 3% but not
more than 17% (only a whole percentage can be elected) of the Compensation
which otherwise would have been paid to him during that period and have
that amount contributed under the Plan on his behalf by his Employer as a
Tax Deferred Contribution; provided, however, that, even though the amount
is not equal to a full percentage of Compensation, a Member may elect to
make aggregate Tax Deferred Contributions of $7,000 (as adjusted under the
provisions of Section 402(g)(5) of the Code), or such greater amount which
may be permitted to be contributed to the Plan on a tax deferred basis
under a qualified cash or deferred arrangement under Section 401(k) of the
Code, in any taxable year; and further provided that such Tax Deferred
Contributions shall not exceed the amount permitted to be contributed
under the provisions of Section 415(c) of the Code or under the actual
deferral percentage test under Section 401(k) (3)(A)(ii) of the Code and
the regulations thereunder.
4.2 Taxed Contributions. A Member may elect to make Taxed Contributions for
each pay period by payroll deductions in an amount equal to any whole
number percentage of his Compensation not to exceed 10% of his
Compensation subject to a minimum of 3% for a Member who has not elected
any Tax Deferred Contributions. In addition, a Member's election of Tax
Deferred Contributions shall automatically be treated as an election of
Taxed Contributions (subject to the 10% limitation on Taxed Contributions)
to the extent additional Tax Deferred Contributions may not be made by
reason of the limitation set forth in Section 2.1(y).
4.3 Aggregate Limitation on Tax Deferred Contributions and Taxed
Contributions. Notwithstanding the foregoing provisions of Section 4.1
and 4.2, the aggregate percentage of Tax Deferred Contributions and Taxed
Contributions may not exceed 17%.
<PAGE>
4.4 Change in Contribution Rate. A Member may discontinue or change his rate
of Member Elected Contributions only as of an Enrollment Date by filing
the appropriate notice with his Employer at least 15 days prior to the
applicable Enrollment Date. A Member may not have discontinued contri-
butions made up, but may resume having contributions made as of any
Enrollment Date by filing the enrollment election specified in Section
3.2.
4.5 Change in Employment Status.
(a) A Member who ceases to be an Employee, but who remains in the
employment of the Controlled Group, will have his Member Elected
Contributions automatically discontinued as of the date of change of
employment status. Such Member's Elected Contributions may be
resumed on any Enrollment Date after he again becomes an Employee by
filing the enrollment election specified in Section 3.2, but discon-
tinued contributions cannot be made up.
(b) No Member Elected Contributions will be made to the Plan for any
period in which the Member is not receiving Compensation.
4.6 Payment of Member Elected Contributions to Trustee. As soon as
practicable after the last day of each month, the Employers will pay to
the Trustee the amount of each Member's Elected Contributions for each
payroll paid in the month.
4.7 Modification of Member Elected Contributions to Satisfy Code Requirements.
(a) In order to satisfy the deferral percentage limitations imposed by
Section 401(k)(3) of the Code, the Board may, at any time, in its
sole discretion and without the prior consent of affected Members
prospectively limit the percentage of Tax Deferred Contributions
elected by either all Members or all Members who are Highly
Compensated Employees. Such limitation will be imposed to the
extent deemed necessary by the Board.
If any Member's Tax Deferred Contribution rate is limited pursuant
to this Section or the limitation set forth in Section 2.1(y), the
rate at which the Member has elected to make Taxed Contributions may
be considered increased to the extent that his Tax Deferred
Contribution rate has been decreased. A Member's Taxed
Contributions for the Plan Year may not exceed 10% of the Member's
Compensation for the Plan Year unless the Member is precluded by
Section 6.3 from having any Tax Deferred Contributions made to the
Plan, in which case the Member's Taxed Contributions will be limited
to 13% of his Compensation for the Plan Year (any refund to the
Member to comply with this limitation will be made as soon as
practicable after the end of the Plan Year). In no event, however,
shall a Member's Taxed Contributions exceed 10% of the Member's
aggregate Compensation for all of the Plan Years of his
participation in the Plan.
<PAGE>
(b) For purposes of determining whether the Plan satisfies the deferral
percentage limitation imposed by Section 401(k)(3) of the Code,
(1) the actual deferral percentage specified in Section
401(k)(3)(B) of the Code for each Member will be the ratio
of the Tax Deferred Contribution allocated to the Member's
Accounts for the Plan Year to the Member's compensation
which meets the requirements of Section 414(s) of the Code
and the regulations thereunder for the Plan Year, and
(2) If an individual has not satisfied the eligibility
requirements set forth in Section 3.1 of this Plan during
any part of the Plan Year, Compensation received by such
person during that period will not be included in
determining the person's "actual deferral percentage" within
the meaning of Section 401(k)(3)(B) of the Code.
<PAGE>
(c) All Member Elected Contributions are subject to the limitations
imposed in Section 6.3.
<PAGE>
ARTICLE V
EMPLOYER CONTRIBUTIONS
5.1 Matching Contributions. On behalf of each Member in its employ who has
completed one year of Continuous Employment and is having Tax Deferred
Contributions made to this Plan pursuant to Section 4.1 or has contributed
Tax Deferred Contributions on a year to date basis equal to 3% of his
Compensation for the entire Plan Year (or who would have had Tax Deferred
Contributions made on his behalf but for the limitations imposed in
Sections 2.1(y), 4.1 or 6.3 of the Plan and who is making Taxed Contribu-
tions at the rate of at least 3% of his Compensation), as of any
Enrollment Date, each Employer will make Matching Contributions to the
Plan for each month, out of current or accumulated earnings and profits,
equal to either 4% of each such Member's Compensation if such Member
elected to invest at least 3% of such Member's Compensation for such
period in the Company Stock Fund or 3% of each such Member's Compensation
if such Member did not elect to invest at least 3% of such Member's
Compensation for such period in the Company Stock Fund, less any amount of
forfeitures then to be applied to reduce the Matching Contributions
pursuant to Section 14.1; provided, however, that no Matching
Contributions shall be made with respect to Compensation for any period
during which a Member's right to make Member Elected Contributions is
suspended by reason of a withdrawal of matched Taxed Contributions (see
Section 9.3).
5.2 Profit Requirement. In the event that any Employer is prevented from
making its share of such Contributions it would be required to make as
provided above because it has neither current nor accumulated earnings and
profits, or because its current or accumulated earnings and profits are
insufficient to make the required contribution, then the required
Contribution or that portion of it in excess of the Employer's current or
accumulated earnings and profits, if any, which the Employer is so
prevented from making will be made for the Employer by the other Employers
who have current or accumulated earnings and profits. If more than one of
the other Employers has current or accumulated earnings and profits, then
each such Employer will be charged and pay that portion of the prevented
Contribution which bears the same ratio to the total prevented
Contributions as that Employer's current or accumulated earnings and
profits (adjusted for its own Contribution deductible for the concurrent
period without regard to its share of the said prevented Contribution)
bears to the total current or accumulated earnings and profits of all
Employers having such earnings and profits (adjusted to their Contribu-
tions deductible without regard to their share of the prevented
Contribution); and, in making this determination, current accumulated
earnings and profits for such period shall be computed as of the close of
the concurrent period without diminution by reason of any dividends during
the concurrent period, and current accumulated earnings and profits shall
be computed as of the beginning of the concurrent period. Notwithstanding
the above provisions of this paragraph, with respect to any period for
which a consolidated federal income tax return is to be filed for all
Employers, any required Contribution which an Employer may be prevented
from making may be made for such Employer by any one or more of the other
Employers on the above basis or any other basis that the Company may
determine. The provisions of this paragraph will apply only to those
Employers under the Plan which are Members of the "affiliated group"
including the Company as the term "affiliated group" is defined in Section
1504(a) of the Code.
<PAGE>
5.3 Payment to the Trustee. As soon as practicable after the end of each
month, each Employer will pay or transfer to the Trustee the amount of its
Matching Contributions for such month.
<PAGE>
5.4 Plan Expenses.
(a) The expenses applicable to each Investment Fund, including (i)
investment management fees and (ii) all proper charges and
disbursements incurred with respect to each Investment Fund
(including brokerage fees, transfer taxes, consulting fees, and any
other expenses related to each applicable Investment Fund) shall be
paid out of the Trust Fund and allocated to and deducted from the
Accounts of Members based on the Members' pro rata share of each
applicable Investment Fund unless such expenses are paid directly by
each Employer.
(b) Except for expenses applicable to each Investment Fund (see Section
5.4(a)), all costs and expenses incurred in administering the Plan,
including the fees and expenses of the Trustees and of counsel and
other administrative expenses, shall be paid by each Employer.
(c) Taxes, if any, on assets held by the Trustee or on any income
derived therefrom, and which are payable by the Trustee, shall be
paid out of the Trust Fund, and allocated to and deducted from the
Accounts of Members based on the Members' pro rata share of all
Investment Funds of the Trust Fund.
5.5 Limitations under Section 401(m) of the Code. In no event shall the
Matching Contributions and Taxed Contributions exceed the limitations set
forth in Section 401(m) of the Code and the regulations thereunder.
<PAGE>
ARTICLE VI
MEMBERS' ACCOUNTS
6.1 Types of Accounts. In addition to the Accounts maintained by the Board
with respect to Plan Years beginning before January 1, 1984, the Board
will establish and maintain on behalf of each Member:
(a) A Tax Deferred Contribution Account, to be credited with the
Member's Tax Deferred Contributions;
(b) A Taxed Contribution Account, to be credited with:
(1) the Member's Taxed Contributions,
(2) on January 1, 1984, the balances of the Member's
- Supplemental Contribution Account; and
- Matured Basic Contribution Account,
if any, which were maintained under the Plan prior to 1984
(to the extent not withdrawn effective December 31, 1983),
and
(3) on January 1, of 1985, 1986 and 1987, that balance of the
Member's Basic Contribution Account which will mature on the
December 31 of the preceding year in accordance with the
terms of the Plan as in effect prior to this restatement;
(c) A Matching Contribution Account, to be credited with the Matching
Employer Contributions allocated to the Member; and
(d) A Matured Stock Account, to be credited with Matching Contributions
when they become nonforfeitable in accordance with Article VIII of
this Plan or Article IX of the Plan as in effect prior to this
restatement (to the extent not withdrawn effective December 31,
1983).
All amounts will be credited to a Member's Accounts as of a
Valuation Date and in the appropriate Investment Fund, in accordance
with the Member's investment election made pursuant to Article VII.
<PAGE>
6.2 Valuation of Accounts. As of each Valuation Date, the Trustee will
determine the net worth of the assets of each Investment Fund and report
such value to the Board. In determining such net worth, the Trustee will
evaluate the assets of each Investment Fund at their fair market value as
of the Valuation Date and will deduct any liabilities or other amounts
properly chargeable against each Investment Fund. The net worth of each
Investment Fund will be allocated among the various Accounts of each
Member in each Fund in the following manner:
(a) The opening balance in each Account in each Fund will be determined
by reducing the value of the Account as of the prior Valuation Date
by any withdrawals or distributions made as of such prior Valuation
Date;
(b) The dollar amount of Member Elected Contributions and Matching
Contributions due each Account since the prior Valuation Date will
be determined (the "current quarter contributions"); and
(c) The fair market value of each Fund on the Valuation Date as of which
the determination is being made will be apportioned to each Member's
Accounts in each Fund based on rate of return factors developed
separately for the opening balances in all of the Accounts in the
Fund and the current quarter contributions credited to all such
Accounts.
<PAGE>
6.3 Limitations Imposed Under Section 415 of the Code.
(a) The provisions of this Section 6.3 supersede all other provisions of
this Plan.
(b) The total Account Addition of any Member for any calendar year may
not exceed the lesser of:
(1) $30,000 (or, if greater, one-fourth of the defined benefit
dollar limitation set forth in Section 415(b)(1) of the Code
as in effect for the applicable calendar year), or
(2) 25% of the Member's total compensation for such calendar
year. For this purpose, a Member's compensation is equal
to his Compensation less his Tax Deferred Contributions.
(c) The term "Account Addition" means the sum of the following amounts
allocated to a Member's Accounts for any calendar year:
(1) The Matching Contributions,
(2) the Member's Tax Deferred Contributions,
(3) the Member's Taxed Contributions,
(4) contributions allocated to any individual medical account
(as defined in Section 415(1)(2) of the Code) which is part
of a defined benefit plan maintained by the Employer, and
(5) if the Member is a Key Employee (within the meaning of
Section 21.2(c) hereof), amounts attributable to medical
benefits allocated to an account established for such Member
in accordance with Section 419A(d) of the Code.
<PAGE>
(d) The Board will apply the limitation set forth in this Section 6.3 by
taking into account the Account Additions under any other qualified
defined contribution plan maintained by the Controlled Group. If
any Member also participates in any defined benefit plan maintained
by the Controlled Group, the sum of a Member's defined benefit plan
fraction for such year as defined in Section 415(e)(2) of the Code
and such Member's defined contribution plan fraction for such year
as defined in Section 415(e)(3) of the Code will not exceed 1.0. In
the event the sum of such fractions would exceed l.0, the Member's
retirement benefit under such defined benefit plan shall
automatically be reduced by the amount required in order that the
sum of such fractions shall not exceed l.0.
(e) If amounts which would otherwise be allocated to a Member's Accounts
must be reduced to satisfy paragraph (b) or (d), the reduction will
be made in the following order, but only to the extent necessary:
(1) The amount of his Taxed Contributions will be refunded as
soon as practicable; then
(2) His Tax Deferred Contributions and related Matching
Contributions will be reduced and held in the Trust Fund,
and will be applied to reduce the Matching Contribution of
his Employer.
<PAGE>
ARTICLE VII
INVESTMENT ELECTIONS
7.1. Company Stock Fund.
(a) Subject to Section 7.1(d), Matching Contributions must be invested
in Stock, but they may be invested in short term obligations of the
United States government and other investments of a short-term
nature, including commercial paper, pending investment in Stock.
(b) Subject to Section 7.1(c), cash dividends and cash proceeds of any
other distributions received on the Stock will be reinvested in the
same manner. The shares of Stock from time to time required for the
purposes of this Plan will be acquired by the Trustee by purchase in
the open market, or, if directed by the Company, by contribution in
kind or by purchase privately from the Company or any other person
at a price per share equal to the closing price per share at which
the shares of Common Stock of the Company were sold on the New York
Stock Exchange on the last business day preceding the day of the
purchase; it being understood that shares purchased from the Company
may be either treasury shares or authorized but unissued shares, if
the Company shall make such shares available for the purpose, and
that the Trustee in its discretion may refrain from making purchases
in the open market whenever in the light of current market
conditions it deems such refraining to be in the best interests of
the Members and beneficiaries in the Plan.
(c) Notwithstanding the provisions of Section 7.1(b), the Board may, in
its discretion, elect to have all cash dividends received on the
Stock by the ESOP be distributed in cash to Members or their
Beneficiaries, as the case may be. Such distribution shall be in an
amount attributable to the shares of Stock held for each such Member
or Beneficiary in such Member's or Beneficiary's Accounts, whether
or not the Member is vested in such shares at the time of such
payment. Distribution shall be made not later than 90 days after
the close of the Plan Year in which the dividends are paid. All
such dividends are nonforfeitable to the Member or Beneficiary when
distributed, even when they are paid with respect to shares of Stock
in which the Member or Beneficiary has not attained a nonforfeitable
interest as of the date of such distribution.
<PAGE>
(d) A Member who shall have attained age 55 and shall have had at least
five years of Continuous Employment may transfer part or all of the
balance of his Matching Contribution Account in his Company Stock
Fund to another Investment Fund as of the last day of any calendar
quarter on 15 days' notice of such transfer to the Corporate Pension
Board.
7.2 Funds for Member Elected Contributions.
(a) All Members' Elected Contributions will be invested in the
Investment Funds selected by the Member in 25% increments, at the
time he files the election specified in Section 3.2, from the Funds
which are made available from time to time by the Board for that
purpose; provided, however, that if the Member elects to invest 3%
of such Member's Compensation in the Company Stock Fund pursuant to
Section 5.1, the applicable 25% increments shall apply to any
additional Member Elected Contributions. All Members' Elected
Contributions will be credited to their Accounts in the respective
Investment Funds. In addition to the Company Stock Fund, the Board
shall establish at least three alternative Investment Funds. All
dividends, interest, gains and losses of each Investment Fund will
be reinvested in that Investment Fund and credited to the Member's
Accounts as of the applicable Valuation Date. The Board will from
time to time inform the Members of the Investment Funds provided
under the Trust and specify all rules governing the investment by
Members in such Funds.
(b) The making of an election of an Investment Fund is the sole
responsibility of each Member. Neither the Trustee, the Board, any
Employer nor any of their officers, directors, or supervisors are
authorized or permitted to advise a Member as to the election of any
Investment Fund or Funds or the manner in which his Accounts ought
to be invested.
(c) A Member may change his investment election for future Member
Elected Contributions as of the first day of any calendar quarter on
15 days' notice of such change to the Corporate Pension Board, which
notice shall specify the new investment election.
(d) A Member may transfer part or all of the balance in his Accounts in
any Investment Fund to one or more other Investment Funds as of the
last day of any calendar quarter on 15 days' notice of such transfer
to the Corporate Pension Board.
<PAGE>
7.3 Distributions.
(a) Withdrawals and distributions from the Trust Fund will be charged to
the Member's Accounts in each Fund. The Board may establish rules
and regulations and accounting conventions to determine the
particular Account and Fund to be charged in the case of a
withdrawal or distribution of less than the entire balances in all
of a Member's Accounts in all Funds.
(b) The distributable amount in a Member's Account in each Fund will be
determined on the basis of the value of such Account on the
Valuation Date coincident with or next preceding the date on which
the distribution is effected.
(c) All withdrawals and distributions will be made in cash; provided,
however, that, with respect to a distribution under Article X, a
Member may elect to have his distribution paid in the form of Stocks
(with fractional shares to be paid in cash) to the extent of his
vested interest in the Company Stock Fund.
<PAGE>
ARTICLE VIII
VESTING
8.1 Vesting in Matching Contributions. A Member's rights to the Matching
Contributions credited to his Matching Contribution Account will become
nonforfeitable on the first to occur of:
(a) December 31 of the third full calendar year after the calendar year
for which the Matching Contributions were made,
(b) the Member's completion of five years of Continuous Employment,
(c) the Member's Retirement,
(d) the Member's death,
(e) the Member's termination of service with the Controlled Group by
reason of Disability, or
(f) Termination of the Plan, partial termination of the Plan which
directly affects the Member, or complete discontinuance of Matching
Contributions.
For vesting purposes, Continuous Employment shall include any period of
service as an employee with any employer which becomes or is consolidated
with or merged into, or whose stocks or properties are acquired by an
Employer.
As a Member's rights to Matching Contributions become nonforfeitable each
December 31 or otherwise, these Contributions and any related earnings and
losses will be transferred to his Matured Stock Account.
8.2 Termination of Employment and Transfer Prior to Vesting.
(a) If a Member's employment with the Controlled Group terminates and he
is not reemployed before incurring five consecutive 1-year breaks in
service (as defined in Section 10.3), the balance of his Matching
Contributions Account will be forfeited as of December 31 of the
calendar year in which occurs the fifth such consecutive 1-year
break in service and will be applied as provided in Section 14.1,
unless the Member elects pursuant to Section 10.2(c) not to receive
a distribution from the Plan until after his rights become non-
forfeitable.
(b) A Member transferred to a non-participating subsidiary or affiliate
of the Company or who otherwise ceases to be an Employee without
termination of his employment by an Employer or the Controlled Group
will continue to be deemed a Member of the Plan for purposes of
vesting of his Matching Contribution Account for as long as he
remains an employee of the Controlled Group.
<PAGE>
8.3 Vesting in Member Elected Contributions. Each Member is at all times 100%
vested in the value of his Member Elected Contribution Accounts.
<PAGE>
ARTICLE IX
IN SERVICE WITHDRAWALS
9.1 Elections to Withdraw Funds and Payment. All withdrawal requests for
Members who are actively employed must be made on the form prescribed by
the Board, specifying the amount to be withdrawn. Each Member will be
entitled to two withdrawal requests per calendar year. All withdrawals
will be made as of the Valuation Date which follows by at least 15 days
the date on which the Board receives notice of the withdrawal, but the
Board may, in its sole discretion, impose from time to time such other
restrictions or conditions on withdrawals as it deems necessary to
preserve the integrity of the Trust Fund. Payment to a Member will be
made in a lump sum in cash as soon after the Valuation Date as
practicable; provided, however, that a Member may elect to have his
distribution paid in the form of Stock (with fractional shares to be paid
in cash) to the extent of his interest in the Company Stock Fund.
9.2 Order of Withdrawals. All withdrawals by Members prior to termination of
employment with the Controlled Group will be charged to a Member's
Accounts in the order and under the conditions, if any, which follow:
(a) First, to the Member's Taxed Contribution Account,
(b) Second, to the Member's Matured Stock Account; provided, however,
that a Member who has not been a Member for at least 60 months prior
to the effective date of a withdrawal may not withdraw amounts
attributable to Matching Contributions made less than 24 months
prior to the effective date of the withdrawal,
(c) Third, to the Member's Tax Deferred Contribution Account if the
withdrawal is on account of hardship and is approved by the Board;
provided, however, that on and after January 1, 1989, only the
<PAGE>
amount of the Tax Deferred Contributions (but no earnings thereon)
may be included in a hardship withdrawal unless such Member has
attained age 59-1/2, in which case earnings may be included. The
Board may authorize a hardship withdrawal only if (i) the Member
certifies that he requires financial assistance to meet an immediate
and heavy financial need and other resources are not reasonably
available to meet the need incurred or to be incurred in the near
future with respect to his health or welfare or that of his immedi-
ate family (such as for the purchase of a principal residence for
the Member, medical expenses not covered by insurance, payment of
tuition for post-secondary education for the Member, his spouse or
children or payment of amounts necessary to prevent the eviction of
the employee from his principal residence or foreclosure on the
mortgage of the employee's principal residence), and (ii) the Member
certifies to the precise amount required to satisfy the hardship.
A Member shall furnish evidence of hardship satisfactory to the
Board which will be determined on a nondiscriminatory basis
uniformly applicable to all Members similarly situated. A with-
drawal may be authorized only to the extent necessary to satisfy the
hardship. The Board's decision shall be final and binding on the
Member.
9.3 Withdrawal of Matched Taxed Contributions. If a Member withdraws any
Taxed Contributions that are matched by the Employer and such Taxed
Contributions have not been held by the Plan for at least two years, his
right to make Member Elected Contributions shall be suspended for a period
of three months.
9.4 Additional Rules. The Board may prescribe from time to time such
additional rules with respect to withdrawals (including restricting a
Member's right to make Member Elected Contributions) as it deems appro-
priate to further the purposes of the Plan, but no such rules will cause
the forfeiture of vested Accounts.
9.5 Loans. Pursuant to rules and regulations established by the Board, loans
may be made pursuant to the Plan which shall be charged against a Member's
Accounts. Such loans may not exceed the balance in such Accounts,
excluding, for this purpose, those amounts attributable to Matching
Contributions, whether vested or unvested. In connection with such loans,
the rules and regulations shall (a) provide for the securing of such loans
by, among other things, the value of the Member's Accounts, (b) provide a
reasonable rate of interest, (c) set forth the maximum loan term, (d)
establish any minimum and maximum amounts, (e) provide a fixed repayment
schedule (including payroll deductions), and (f) establish such other
requirements as the Board shall deem appropriate. Loans shall be
available to all Members on a non-discriminatory basis.
<PAGE>
ARTICLE X
DISTRIBUTIONS AT TERMINATION OF EMPLOYMENT
10.1 Distributions on Account of Retirement, after Completion of Five Years of
Continuous Employment, Disability or Death. Upon a Member's termination
of service by reason of Retirement, after completion of five years of
Continuous Employment, Disability or upon a Member's death, there will be
distributed to him (or in the case of his death, to his Beneficiary), in
accordance with Section 10.4, the balance of his Accounts determined as of
the Valuation Date coincident with or next following such termination of
service or death in accordance with Section 10.7. Such distribution shall
commence as soon as practicable following such Valuation Date. Notwith-
standing the foregoing provisions of this Section 10.1 or of Section 10.2,
the payment of benefits shall commence not later than April 1 of the
calendar year next following the calendar year in which the Member attains
age 70-1/2.
10.2 Other Distributions. When a Member terminates employment with the
Controlled Group for reasons other than Retirement, after completion of
five years of Continuous Employment, death or Disability, he must elect
subject to Section 10.7 either,
(a) to make one last in-service withdrawal of all or part of his Taxed
Contribution Account and his Matured Stock Account (provided he had
made no more than one previous withdrawal during the year) and leave
the balance of his Accounts in the Plan until his rights to all
Matching Contributions have become nonforfeitable in accordance with
Section 8.1; or
(b) to receive the balance of all of his Accounts but not the balance of
his Matching Contribution Account, determined as of the Valuation
Date which coincides with or immediately follows the date of his
termination of employment, and forfeit his Matching Contribution
Account pursuant to Section 8.2 (subject to the restoration
provisions of Section 10.3); or
(c) to defer receipt of all amounts until his rights to all Matching
Contributions which were credited to his Matching Contribution
Account on the date of his termination of employment become nonfor-
feitable in accordance with Section 8.1. If deferral is elected the
amount distributable to the Member will be the balance of all of his
Accounts, determined as of the Valuation Date which coincides with
or immediately follows the date on which all of his Matching
Contributions become nonforfeitable.
A Member electing to defer receipt of his Accounts at termination under
(a) or (c) above may nevertheless elect at some subsequent date, before
all Matching Contributions have become nonforfeitable, to receive the
balance of all his Accounts together with all Matching Contributions which
at that date have become nonforfeitable. Such distribution will result in
a forfeiture of the balance of his Matching Contribution Account pursuant
to Section 8.2 (subject to the restoration provisions of Section 10.3).
<PAGE>
10.3 Restoration of Forfeitures. A Member may restore account balances which
are forfeited under Sections 8.2(a) and 10.2(b) of the Plan by repaying
the amount withdrawn by or distributed to him which caused the
forfeiture. Repayment may be made at any time prior to the earlier of (i)
December 31 of the fifth calendar year after the calendar year in which
the withdrawal or distribution was made or (ii) the date on which the
Member incurs his fifth consecutive 1-year break in service commencing
after the withdrawal or distribution. For purposes of the preceding
sentence, a 1 - year break in service means a 12-consecutive month period
beginning on the severance from service date and ending on each
anniversary thereof, provided that during such 12-consecutive month period
the Employee does not perform an hour of service which he is paid or
entitled to payment for the performance of duties for an Employer.
The amount of a Member's repaid withdrawal will be credited to the
Member's Account as of the Enrollment Date which follows receipt by the
Trustee of such repayment. The restoration of forfeited amounts will be
effected as of such Enrollment Date by credit to the Member's Matching
Contribution Account of Stock having a fair market value at the Enrollment
Date equal to the fair market value at the date of forfeiture of the Stock
forfeited by reason of the withdrawal. Repaid withdrawals will be
invested in accordance with a new investment election filed by the Member
with the Board. A Member's restored Matching Contribution Account will
be nonforfeitable on December 31 of the calendar year determined as
follows: to the calendar year in which the Member's Contribution Account
would have matured (had the forfeiture not occurred) will be added the
number of calendar years during any part of which the withdrawn
contributions were not repaid.
The repayment of withdrawn contributions and the restoration of forfeited
amounts will not be considered in the Account Addition as defined in
Section 6.3.
<PAGE>
10.4 Methods of Payment.
(a) Distributions from the Plan will be paid as follows:
(i) Death.
Any distribution of Accounts in the event of death of a
Member will be made by a single payment to his Beneficiary
consisting of cash and Stock credited to his Accounts unless
the Member has elected an alternate method of payment
pursuant to subsection 10.4(a)(v), in which event the
Member's remaining interest in his Accounts will be
distributed in accordance with the method of payment being
used as of the date of the Member's death.
(ii) Disability.
Any distribution of Accounts in the event of Disability of
a Member while in the service of the Controlled Group will
be made by a single payment to the Member consisting of cash
and Stock credited to his Accounts.
(iii) Termination after Completion of Five Years of Continuous
Employment.
Any distribution of Accounts on account of termination of
service after completion of five years of Continuous
Employment will be made by a single payment to the Member
consisting of cash and Stock credited to his Accounts.
(iv) Termination of Service Prior to Age 55.
Any distribution of Accounts on account of termination of
service prior to age 55 pursuant to Section 10.2 will be
made by a single payment to the Member consisting of cash
and Stock credited to his Accounts.
(v) Retirement.
Any distribution of the Member's Deferred and Taxed
Contribution Accounts on account of Retirement as defined
in Section 2.1(w) will be made, subject to subsection
10.4(b), in one of the following ways selected by the
Member, provided, however, that if such Accounts total less
than $10,000 the distribution will be made only in one lump
sum:
(1) in one lump sum;
(2) in installments over a period not exceeding ten
years; or
<PAGE>
(3) in the form of a non-commutable and non-
assignable annuity but only if a group annuity
contract constitutes a part of the Trust
Fund. Any such annuity shall be in such form that
more than 50% of its actuarial value at its
commencement date is attributable to payments to
be made to the Member himself, unless the annuity
is payable for a period not extending beyond the
life expectancy of the Member and his spouse.
Notwithstanding the foregoing, the annuity option
pursuant to this Section 10.4(a)(v)(3) shall not
be available in the case of a Member who has any
loan outstanding pursuant to Section 9.5.
No form of distribution permitted under this Section 10.4(a) shall
provide for payments over a period exceeding (i) the life of the
Member, (ii) the life expectancy of the Member, (iii) the joint
lives of the Member and his designated Beneficiary, or (iv) the
joint life and last survivor expectancy of the Member and his
designated Beneficiary (redetermined annually if the Member's spouse
is his designated Beneficiary).
(b) If the Member elects to receive an annuity pursuant to Section
10.4(a)(v)(3), then any distribution (except distribution in Stock)
made to a Member who is married on the distribution date will be
made in the form of a Qualified Joint and Survivor Annuity unless
the Member elects otherwise in the manner described below. A
Qualified Joint and Survivor Annuity is an annuity which (i) has an
actuarial value equivalent to the amount of the Member's
distribution (less the value of the Stock distributed) and (ii)
provides for a distribution during the Member's life commencing on
the date of his Retirement, with the provision that after his death
(whether before or after commencement of benefit payments to him)
distribution at a rate equal to 50% of the rate of the distribution
during his life (or which would have been made during his life had
payments commenced on the first day of the month next succeeding
that in which his death occurs) shall be paid during the life of,
and to, his spouse provided his spouse survives him.
<PAGE>
A Member may elect by written notice to the Board, at any time
during the election period (and after having received from the Board
a written notice of the availability of such election and the avail-
ability upon request of a written explanation of the effect of
receiving a distribution in the form of a Qualified Joint and
Survivor Annuity pursuant to this Section 10.4) to receive a
distribution in the form of an annuity other than the Qualified
Joint and Survivor Annuity, but only if his spouse consents to such
election in a writing that acknowledges the effect of such election
and that is witnessed by a notary public or Plan representative.
The election period will begin 90 days prior to the commencement of
payment of a benefit which could be paid in the form of an annuity
to the Member hereunder and will end on the date of commencement of
payment of such benefits. If the Member requests during the
election period a written explanation of the terms and conditions of
the Qualified Joint and Survivor Annuity and the financial effect
upon the Member's benefits (in terms of dollars per annuity payment)
of making an election not to take the same, payment of benefits in
any other form will be delayed until the 90th day after such written
explanation is given, and the Member's request for such an
explanation shall constitute an election that commencement of pay-
ment of benefits shall be so delayed. The Board will notify each
Member who elects to receive an annuity not later than 7 days after
commencement of the election period of his right to request the
written explanation referred to above. The written explanation will
in all cases be provided to the Member within 7 days after receipt
of his request therefor. The election in writing will be revocable
until the election period has expired and shall clearly indicate the
Member's election to receive his benefit hereunder in a form other
than that of a Qualified Joint and Survivor Annuity.
10.5 Withholding of Taxes. Income taxes will be withheld from distributions
and withdrawals as required under applicable laws.
10.6 Restrictions on Cashouts. Unless a Member consents to the distribution of
his Accounts in accordance with the provisions of Section 10.1 or 10.2, as
applicable, if the amount credited to such Member's Accounts exceeds
$3,500, the distribution shall not commence prior to the Member's
attainment of age 62.
10.7 ELECTIONS FOR DISTRIBUTIONS AND PAYMENT. All distribution requests by
Members must be made on the form prescribed by the Board. All
distributions will be made as of the Valuation Date which follows by at
least 15 days the date on which the Board receives notice of the
distribution. Payment to a Member will be made in a lump sum in cash as
soon after the Valuation Date as practicable; provided, however, that a
Member may elect to have his distribution paid in the form of Stock (with
fractional shares to be paid in cash) to the extent of his interest in the
Company Stock Fund.
<PAGE>
ARTICLE XI
DISTRIBUTION OF EXCESS DEFERRALS
11.1 In General. Notwithstanding any other provision of the Plan, Excess
Deferral Amounts and income allocable thereto shall be distributed no
later than April 15, 1988, and each April 15 thereafter to Members who
claim such Allocable Excess Deferral Amounts for the preceding calendar
year.
11.2 Definitions. For purposes of this Article XI, "Excess Deferral Amount"
shall mean the amount of Tax Deferred Contributions for a calendar year
that the Member allocates to this Plan pursuant to the claim procedure set
forth in Section 11.3.
11.3 Claims. The Member's claim shall be in writing, shall be submitted to the
Corporate Pension Board no later than March 1; shall specify the Member's
Excess Deferral Amount for the preceding calendar year; and shall be
accompanied by the Member's written statement that if such amounts are not
distributed, such Excess Deferral Amount, when added to amounts deferred
under other plans or arrangements described in Sections 401(k), 408(k) or
403(b) of the Code, exceeds the limit imposed on the Member by Section
402(g) of the Code for the year in which the deferral occurred.
11.4 Maximum Distribution Amount. The Excess Deferral Amount distributed to a
Member with respect to a calendar year shall be adjusted for income and,
if there is a loss allocable to the Excess Deferral, shall in no event be
less than the lesser of the Member's account under the Plan or the
Member's Tax Deferred Contributions for the calendar year.
<PAGE>
ARTICLE XII
DISTRIBUTION OF EXCESS CONTRIBUTIONS
12.1 In General. Notwithstanding any other provision of the Plan, Excess
Contributions and income allocable thereto shall be distributed no later
than the last day of each Plan Year beginning after December 31, 1987, to
Members on whose behalf such Excess Contributions were made for the
preceding Plan Year.
12.2 Excess Contributions. For purposes of this Article XII, "Excess
Contributions" shall mean the amount described in Section 401(k)(8)(B) of
the Code.
12.3 Determination of Income. The income allocable to Excess Contributions
shall be determined by multiplying income allocable to the Member's Tax
Deferred Contributions for the Plan Year by a fraction, the numerator of
which is the Excess Contribution on behalf of the Member for the preceding
Plan Year and the denominator of which is the Member's account balance
attributable to Tax Deferred Contributions on the last day of the
preceding Plan Year.
12.4 Maximum Distribution Amount. The Excess Contributions which would
otherwise be distributed to the Member shall be adjusted for income; shall
be reduced, in accordance with regulations, by the amount of Tax Deferred
Contributions distributed to the Member; shall, if there is a loss
allocable to the Excess Contributions, in no event be less than the lesser
of the Member's account under the Plan or the Member's Tax Deferred
Contributions for the Plan Year.
<PAGE>
ARTICLE XIII
DISTRIBUTION OF EXCESS AGGREGATE CONTRIBUTIONS
13.1 In General. Excess Aggregate Contributions and income allocable thereto
shall be forfeited, if otherwise forfeitable under the terms of this Plan,
or if not forfeitable, distributed no later than the last day of each Plan
Year beginning after December 31, 1987, to Members to whose accounts Taxed
Contributions or Matching Contributions were allocated for the preceding
Plan Year.
13.2 Excess Aggregate Contributions. For purposes of this Article XIII,
"Excess Aggregate Contributions" shall mean the amount described in
Section 401(m)(6)(B) of the Code.
13.3 Determination of Income. The income allocable to Excess Aggregate
Contributions shall be determined by multiplying the income allocable to
the Member's Taxed Contributions and Matching Contributions for the Plan
Year by a fraction, the numerator of which is the Excess Aggregate
Contributions on behalf of the Member for the preceding Plan Year and the
denominator of which is the sum of the Member's account balances
attributable to Taxed Contributions and Matching Contributions on the last
day of the preceding Plan Year.
13.4 Maximum Distribution Amount. The Excess Aggregate Contributions to be
distributed to a Member shall be adjusted for income, and, if there is a
loss allocable to the Excess Aggregate Contribution, shall in no event be
less than the lesser of the Member's account under the Plan or the
Member's Taxed Contributions and Matching Contributions for the Plan Year.
13.5 Accounting for Excess Aggregate Contributions. Excess Aggregate
Contributions shall be distributed from the Member's Taxed Contribution
account, and forfeited if otherwise forfeitable under the terms of the
Plan (or, if not forfeitable, distributed) from the Member's Matching
Contribution account in proportion to the Member's Taxed Contributions and
Matching Contributions for the Plan Year.
13.6 Allocation of Forfeitures.
(a) Amounts forfeited by Highly Compensated Employees under this Article
XIII shall be:
(i) Treated as Account Additions under Section 6.3 and either;
(ii) Applied to reduce employer contributions if forfeitures of
Matching Contributions under the Plan are applied to reduce
employer contributions; or
(iii) Allocated, after all other forfeitures under the Plan, and
subject to Section 13.6(b), to the same Members and in the
same manner as such other forfeitures of Matching Contribu-
tions, are allocated to other Members under the Plan.
(b) Notwithstanding the foregoing, no forfeitures arising under this
Article XIII shall be allocated to the account of any Highly
Compensated Employee.
<PAGE>
ARTICLE XIV
APPLICATION OF FORFEITURES
14.1 Any amount which is forfeited by a Member pursuant to Sections 8.2(a), 9.2
and 10.2(b) will be applied, as soon as practicable, to reduce Matching
Contributions.
<PAGE>
ARTICLE XV
TRUST
15.1 Trustee. The Board will appoint the Trustee or Trustees under the Plan.
The Board may, without reference to or action by any Employee, Member or
Beneficiary or any other Employer, enter into a Trust Agreement or
Agreements with the Trustee or Trustees and from time to time enter into
further agreements with the Trustee or Trustees amending the Trust Agree-
ment or Agreements. The Board may at any time remove the Trustee or
Trustees and appoint a successor Trustee or Trustees.
15.2 Acquisition Loans. The Board may from time to time direct the Trustee to
incur an Acquisition Loan (as hereinafter defined). An "Acquisition Loan"
shall mean a loan to the Trust by a "party in interest" as defined in
Section 3(14) of ERISA or a "disqualified person" as defined in Section
4975(e)(7) of the Code, or any other loan which is treated as involving an
extension of credit to the Trust by such a "party in interest" or
"disqualified person". Each Acquisition Loan must satisfy the
requirements set forth in Treasury Regulation Section 54.4975-7(b).
Except as provided herein or as otherwise required by applicable law, no
security acquired with the proceeds of any Acquisition Loan by the ESOP
may be subject to a put, call, or other option, or buy-sell or similar
arrangement while held by and when distributed from the ESOP, whether or
not the ESOP is then an employee stock ownership plan within the meaning
of Section 4975(e)(7) of the Code. Any qualifying employer security,
within the meaning of Code Section 4975(e)(8), which may be acquired with
the proceeds of any Acquisition Loan by the ESOP, will be subject to a put
<PAGE>
option if it is not publicly traded or if it is subject to a trading
limitation when distributed. The put option will be exercisable only by
a Member, the Member's Beneficiary, or by a person to whom the security
passes by reason of a Member's death. Under the put option the security
may be put to the Member's Employer or to the Company. The put option
shall remain in effect for 15 months following the date the security is
distributed. If a security ceases to be publicly traded without restric-
tion within 15 months after distribution, the Company will notify each
security holder in writing within 10 days that the security will be
subject to the put option exercisable for the remainder of the 15-month
period and will explain the option terms in such notice. The period of
the option shall be extended a day for each day the notice is given after
the 10-day period expires.
The put option shall be exercised by written notice to the Employer. The
period during which a put option is exercisable does not include any time
when a distributee is unable to exercise it because the party bound by the
put option is prohibited from honoring it by applicable federal or state
law. The price at which the option is exercisable is the value of the
security, as determined under Section 54.4975-11(d)(5) of the Treasury
Department Regulations. Securities put under this Section 15.2 to the
Employer or to the Company shall be paid for in cash upon receipt by the
Employer or the Company of a properly endorsed stock certificate
representing ownership in the securities. No restrictions as to payment
shall apply, except by applicable state law. The rights and protections
set forth in this Section 15.2 shall be non-terminable.
The provisions of Treasury Department Regulation Section 54.4975-11(c)
shall apply with respect to any assets obtained by the ESOP with the
proceeds of any loan made to the ESOP.
15.3 Special Provisions If Exempt Loan Is Incurred. Anything in the Plan or
the ESOP to the contrary notwithstanding, if an Acquisition Loan is
incurred, the following special provisions shall apply:
(a) At the direction of the Board, any dividends on allocated or
unallocated shares of Common Stock of the Company acquired by the
ESOP with the proceeds of an Acquisition Loan shall be applied to
pay principal and interest on the loan (except to the extent the
amount of such dividends exceeds the remaining principal balance and
interest on the loan).
(b) The Company shall contribute to the Trust an amount which, when
added to the dividends described in (a) above, is sufficient to make
all required payments of principal and interest on the loan. Such
contributions shall be made at such time or times as shall enable
the Trustee to make required payments of principal and interest on
the loan on a timely basis.
<PAGE>
(c) If dividends on shares of Common Stock of the Company allocated to
the account of a Member are applied to the payment of principal or
interest on an Acquisition Loan, shares of Common Stock of the
Company with a value equal to the amount of such dividends shall be
allocated to the Matching Contribution Account of such Member. All
other shares of Common Stock of the Company released from
encumbrance under an Acquisition Loan shall be treated as Matching
Contributions pursuant to Section 5.1 in an amount equal to the
value of such shares as of the date the allocation is made, and the
Employer's obligation to make Matching Contributions pursuant to
Section 5.1 shall be reduced by a corresponding amount.
<PAGE>
ARTICLE XVI
ADMINISTRATION
16.1 Corporate Pension Board.
(a) The Plan will be administered by a Corporate Pension Board
consisting of at least three members who will be appointed from time
to time by the Board of Directors to serve at its pleasure. Members
of the Board may participate in the benefits under the Plan provided
they are otherwise eligible to do so. No member of the Board who is
a full-time Employee of an Employer will receive any compensation
for his service as such member. Except as otherwise provided by law,
no bond or other security will be required of any member of the
Board in such capacity in any jurisdiction.
(b) The members of the Board may appoint from their number such
committees with such powers as they may determine, may authorize one
or more of their number or any agent to execute or deliver any
instrument or make any payment in their behalf, may employ such
counsel, accountants, actuaries, and such clerical services as they
may require in carrying out the provisions of the Plan, and may
appoint one or more designees (who need not be members of the Board)
to serve at the pleasure of the Board and to exercise such of the
powers of the Board as the Board may specify.
(c) The Board will hold meetings upon such notice, at such time, and at
such place as it may determine.
(d) The Board will establish its own rules of procedure.
(e) The Board will appoint the Administrator under the Act, and failing
such appointment will be the Administrator under the Act, and the
Administrator and the members of the Board will be named fiduciaries
<PAGE>
for the Plan under the Act. The members may allocate fiduciary
responsibilities (other than trustee responsibilities) among them-
selves, and may designate persons other than themselves to carry out
fiduciary responsibilities (other than trustee responsibilities)
under the Plan.
16.2 Board Determinations Final. Subject to the limitations of the Plan, the
Board from time to time will establish rules for the administration of the
Plan and the transaction of its business. The Board has the authority to
interpret all the terms of the Plan and to exercise discretion where
necessary or appropriate in the interpretation and administration of the
Plan. The determination of the Board as to any disputed questions will be
conclusive. All actions taken and all decisions and interpretations of
the Board made in administering the Plan will be uniform and non-
discriminatory in respect to all persons similarly situated.
16.3 Claims Procedure. If any claim for benefits under the Plan is denied, the
Board will give notice in writing, by registered or certified mail, of
such denial to the affected Member or Beneficiary, setting forth the
specific reasons for such denial and advising him that he may request
further review by the Board of the decision denying such claim by filing
with the Board, within 30 days after the date of mailing of such notice,
a request for such review. If the Member or Beneficiary files such request
for review, such review will be made by the Board within 60 days of
receipt of such request, and the Member or Beneficiary will be given
written notice of the result of such review.
<PAGE>
ARTICLE XVII
APPROVAL BY THE INTERNAL REVENUE SERVICE
17.1 The Company intends to secure a determination that the Plan is a qualified
Plan under Section 401(a) and 401(k) of the Code, contributions to which
are deductible by the Employers for Federal income tax purposes.
All Matching Contributions and Tax Deferred Contributions made by the
Employers are hereby expressly conditioned upon their deductibility under
Section 404 of the Code and regulations issued thereunder, as amended from
time to time, and if the deduction for any such Contributions is
disallowed in whole or in part, then such Contributions (to the extent the
deduction is disallowed) will be returned to the Employers upon direction
of the Board within one year after such disallowance.
17.2 Any modification or amendment of the Plan or the Trust Agreement may be
made retroactively by the Company or the Board, if necessary or
appropriate to cause the Plan to qualify or maintain its qualification as
a Plan and Trust meeting the requirements of applicable sections of the
Internal Revenue Code and/or other Federal and State laws, as now in
effect or hereafter amended or enacted or a determination to that effect.
Any such modification or amendment, however, will not adversely affect any
right or obligation of any Member theretofore accrued.
<PAGE>
ARTICLE XVIII
GENERAL PROVISIONS
18.1 Member Statements. As soon as practicable following the end of each
calendar year the Board will furnish to each Member a statement setting
forth the balance credited to each of his Accounts in each Investment
Fund as of the end of such calendar year.
18.2 Communications to the Board. All elections, notices, designations and
other communications to the Board will be on the forms from time to time
prescribed by the Board, mailed or delivered to the Board in care of the
Member's Employer, and deemed to have been duly given upon receipt.
18.3 No Employment Rights. The establishment of this Plan will not be
construed as conferring any legal rights upon any Employee or any other
person for a continuation of employment, nor will it interfere with the
rights of any Employer to discharge any Employee and/or to treat him
without regard to the effect which such treatment might have upon him as
a Member.
18.4 Members Assume Investment Risk. All benefits payable under the Plan
will be paid or provided for solely from the Trust Fund and neither the
Company nor any other Employer assumes any liability therefor. Each
Member assumes all risk connected with any decrease in the market value
of any assets held by the Trustee under the Plan. Neither the Trustee,
the Board nor any Employer in any way guarantees the Trust Fund against
loss or depreciation, or the payment of any amount which may be or
become due to any person from the Trust Fund.
18.5 Facility of Payment Provision. If any person to whom a payment is due
hereunder is a minor or is determined by the Board to be incompetent by
<PAGE>
reason of physical or mental disability, the Board may cause the
payments becoming due to such person to be made to another for the
benefit of the minor or incompetent, without responsibility of any
Employer, the Board, or the Trustee to see to the application of such
payment. Payments made pursuant to such power will operate as a
complete discharge of all Employers, the Board, the Trustee and the
Trust Fund.
18.6 Nonassignability of Benefits. No right or interest of any Member in the
Plan is alienable, assignable or transferable, or, to the extent
permitted by law, subject to any lien, in whole or in part, either
directly or by operation of law, or otherwise, including, but not by way
of limitation, execution, levy, garnishment, attachment, pledge,
bankruptcy, or in any other manner, and no right or interest of any
Member in the Plan will be liable for, or be subject to, any obligation
or liability of such Member. This Section 18.6 shall apply to the
creation, assignment or recognition of a right to any benefit payable
with respect to a Member pursuant to a domestic relations order, but
shall not apply if the order is determined to be a qualified domestic
relations order within the meaning of Section 414(p) of the Internal
Revenue Code of 1986, as amended ("Code"). Notwithstanding any other
provision of the Plan, benefits payable under the Plan shall be paid
under the terms of any such qualified domestic relations order.
18.7 Prevention of Escheat. In the event any distribution mailed to a Member
or the Beneficiary at the last known address remains unclaimed by the
Member or his Beneficiary as the case may be, for a period of 24 months
and payment cannot be made alternatively to the estate of either and no
surviving spouse, child, parent, brother or sister, or grandchild of the
Member or Beneficiary are known to the Employer or the Trustee, or if
known, cannot with reasonable diligence be located, the amount payable
may be cancelled on the records of the Plan and used to reduce Matching
Contributions, except that if the Member or Beneficiary later notifies
the Board of his whereabouts and requests the amount due him under the
Plan, the amount will be paid in accordance with Article X.
<PAGE>
18.8 Designation of Beneficiary.
(a) Any Member may at any time and from time to time designate the
Beneficiary to whom the amounts in his Accounts will be delivered in
the event of the Member's death. Any such designation will take
precedence over any testamentary or other disposition. Such
designation or any change or cancellation of such designation under
this Plan will become effective only upon the receipt thereof as
provided in Section 18.2, and will then relate back to the date of
its execution; provided, however, that neither the Trustee, the
Board, nor the Employer will be liable by reason of any payment made
before receipt of such designation, change, or cancellation to the
Member's estate or to any Beneficiary previously designated.
(b) Notwithstanding any other provision of the Plan to the contrary, a
married Member who designates a Beneficiary other than his spouse
must obtain the written consent of such spouse, which consent
acknowledges the effect of such designation and is witnessed by a
notary public or Plan representative.
(c) If no Beneficiary designation is effective pursuant to this Section
18.8, or if the Board or the Trustee are in doubt as to the right of
any claimant, or if the designated Beneficiary predeceases the
Member, the amount in question may, in the discretion of the Board,
be paid directly to the estate of the Member, in which event the
Trustee, the Employer, and the Board will have no further
responsibility or liability with respect thereto.
<PAGE>
(d) Upon receipt by the Board of evidence satisfactory to it of the
death of a Member and of the existence and identity of the
Beneficiary designated by the Member, the Trustee shall pay to such
Beneficiary an amount equal to the balance of the Member's Accounts
in accordance with the provisions of Article X.
18.9 Voting Rights. Before each annual or special meeting of stockholders of
the Company, the Company will cause the Trustee to send to each Member
a copy of the proxy solicitation material therefor, together with a form
requesting confidential instructions to the Trustee on how to vote the
shares of Stock allocated to the Member's Accounts. Upon receipt of
such instructions in conformance with the proxy solicitation material,
the Trustee will vote the shares of Stock as instructed. Instructions
received from individual Members by the Trustee will be held in
strictest confidence and will not be divulged or released to any person,
including officers or employees of any Employer. The Trustee will vote
the shares of Stock for which no instructions have been received in the
same proportion as the shares for which instructions have been received.
18.10 Tender or Exchange Offer. Notwithstanding any other provision of this
Plan or of the Trust Agreement, the Board shall be the sole named
fiduciary with respect to the control and management of assets held in
the Company Stock Fund and the Trustee shall have no authority or
responsibility with respect to such control or management. If a tender
or exchange offer is made for Stock, the Board shall determine whether,
under the circumstances the terms of the offer are such that the
provisions of the Plan and Trust Agreement requiring retention of Stock
in the Company Stock Fund (other than to effect distributions or inter-
account transfers under the Plan) can no longer be validly applied
without violation of Section 404(a) of the Act. In making such
determination the Board shall take into account the purpose of the Plan
to invest Employer contributions and designated Member Elected
Contributions in Stock. If the Board determines that such provisions
can no longer be validly applied, such Board may, in its sole
discretion, direct a disposition of Stock pursuant to such offer.
<PAGE>
18.11 Fractional Interests in Stock. Notwithstanding any other provision of
this Plan, no distribution of a fractional interest in Stock held by the
Trustee will be made to any Member or his Beneficiary. All fractional
interests in Stock otherwise distributable from Members' Accounts will
be the amount in such fund on the Valuation Date coincident with or next
succeeding the date the distribution is to be made and a sum equal
thereto will be distributed in cash. Any distribution in cash based on
an interest in a fractional share will be considered for all purposes
hereof as a distribution of the fractional interest in the share.
18.12 Limitation of Liability. To the extent permitted by the Act, neither the
Trustee, the Board or any member or members of the Board, nor any
Employer or any Director, Officer or employee of any Employer, will have
any personal liability of any nature for any act done or omitted to be
done in good faith, under or in connection with the Plan, the Trust
Agreement and/or the Trust Fund, including but not limited to delay in
the making of any contribution, investment or distribution, or failure
to secure funds needed for Trust purposes, or failure to provide
sufficient Stock for the purposes of the Trust. To the extent permitted
by the Act, each member of the Board, and every Director, Officer and
employee of an Employer will be indemnified and saved harmless by the
Employers against any claims, and the expenses of defending against such
claims, resulting from any action or conduct relating to the
administration of the Plan and the Trust Fund. Each of the Employers
will pay such proportion of any such claim and/or expenses as the
Company directs. Any payment or distribution to a Member, or in case of
his death to his Beneficiary, at the last known post office address of
the distributee on file with the Board, will constitute a complete
acquittance and discharge to each member of the Board, every Director,
Officer, and employee of each Employer having an interest in the Trust
Fund.
<PAGE>
18.13 Service of Process. The Board is designated as the agent of each
Employer and of the Plan for service of process to commence any legal
proceeding against an Employer or against the Plan, pertaining to this
Plan or the determination of any rights hereunder.
18.14 Governing Law. The validity of the Plan or any of its provisions will
be determined under, and it shall be construed and administered
according to, the laws of the State of New York, except as may be
required by any provision of the Act.
18.15 Direct Rollover of Eligible Rollover Distributions.. This Section
applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that would
otherwise limit a distributee's election under this Section, a
distributee may elect, at the time and in the manner prescribed by the
Corporate Pension Board, to have any portion of an eligible rollover
distribution paid directly to an eligible retirement plan specified by
the distributee in a direct rollover. For purposes of this Section, the
following definitions apply.
<PAGE>
(a) Eligible rollover distribution: An eligible rollover distribution
is any distribution of all or any portion of the balance to the
credit of the distributee, except that an eligible rollover
distribution does not include: any distribution that is one of a
series of substantially equal periodic payments (not less frequently
than annually) made for the life (or life expectancy) of the
distributee or the joint lives (or joint life expectancies) of the
distributee and the distributee's designated beneficiary, or for a
specified period of ten years or more; any distribution to the
extent such distribution is required under Section 401(a)(9) of the
Code; and the portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities).
(b) Eligible retirement plan: An eligible retirement plan is an
individual retirement account described in Section 408(a) of the
Code, an individual retirement annuity described in Section 408(b)
of the Code, an annuity plan described in Section 403(a) of the
Code, or a qualified trust described in Section 401(a) of the Code,
that accepts the distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to the
surviving spouse, an eligible retirement plan is an individual
retirement account or individual retirement annuity.
(c) Distributee: A distributee includes an Employee or former Employee.
In addition, the Employee's or former Employee's surviving spouse
and the Employee's or former Employee's spouse or former spouse who
is the alternate payee under a qualified domestic relations order,
as defined in Section 414(p) of the Code, are distributees with
regard to the interest of the spouse or former spouse.
(d) Direct rollover: A direct rollover is payment by the Plan to the
eligible retirement plan specified by the distributee.
<PAGE>
18.16 Verti-Line Product Line of Aurora Pump. Active Employees of the Verti-
Line product line of Aurora Pump on March 17, 1986 shall be 100% vested
in the Matching Contributions as of March 17, 1986 and shall receive
such benefits at such time as they become entitled to them under the
normal terms of such Plan.
18.17 Tapco International, Inc. Active Employees of Tapco International,
Inc. on March 31, 1986 shall be 100% vested in the Matching
Contributions as of March 31, 1986 and shall receive such benefits at
such time as they become entitled to them under the normal terms of such
Plan.
18.18 Warren Communications, Littleton, Massachusetts. Active Employees of
Warren Communications, Littleton, Massachusetts on August 15, 1986 shall
be 100% vested in the Matching Contributions as of August 15, 1986 and
shall receive such benefits at such times as they become entitled to
them under the normal terms of such Plans.
18.19 GS Electric Motors, Inc. Active Employees of GS Electric Motors,
Inc. involuntarily terminated as a result of the closing of the Racine
facility on August 15, 1986 shall be 100% vested in the Matching
Contributions as of August 15, 1986 and shall receive such benefits at
such time as they become entitled to them under the normal terms of such
Plan.
18.20 Kieley & Mueller. Active Employees of Kieley & Mueller involuntarily
terminated as a result of the closing of the Kieley & Mueller plant
shall be 100% vested in the Matching Contributions as of the date each
such employee ceases to be employed and shall receive such benefits at
such time as they become entitled to them under the normal terms of such
Plan.
18.21 Cardion Electronics, Inc. Active Employees of Cardion Electronics,
Inc. on September 12, 1986 shall be 100% vested in the Matching
Contributions as of September 12, 1986 and shall receive such benefits
at such time as they become entitled to them under the normal terms of
such Plan or to elect a trust to trust transfer of their account
balances to the "qualified" defined contribution plan of ISC Defense and
Space Group.
<PAGE>
18.22 Drytek, Inc. For employees of Drytek, Inc., as of January 1, 1987,
former service with Drytek, Inc. shall be recognized as Continuous
Employment for meeting the one-year service requirement for Matching
Contributions.
18.23 Nelson Electric, Homer, Louisiana. Active Employees of Nelson Electric,
Homer, Louisiana involuntarily terminated as a result of either the sale
of the Marine Hardware Division on June 23, 1986 or the closing of the
facility on April 10, 1987 shall be 100% vested in the Matching
Contributions as of June 23, 1986 or April 10, 1987, respectively, and
shall receive such benefits at such time as they become entitled to them
under the normal terms of such Plan.
18.24 Cincinnati Time, Inc. Active Employees of Cincinnati Time, Inc. on May
2, 1987 shall be 100% vested in the Matching Contributions as of May 2,
1987 and shall receive such benefits at such time as they become
entitled to them under the normal terms of such Plan.
18.25 Nester Instruments Company. Active Employees of Nester Instruments
Company involuntarily terminated as a result of the closing of the
Nester Instruments Company on May 29, 1987 shall be 100% vested in the
Matching Contributions as of the date each such employee ceases to be
employed and shall receive such benefits at such time as they become
entitled to them under the normal terms of such Plan.
<PAGE>
18.26 Hydreco. Active Employees of Hydreco on September 11, 1987 shall be
100% vested in the Matching Contributions as of September 11, 1987 and
shall receive such benefits at such time as they become entitled to them
under the normal terms of such Plan.
18.27 Quali-Cast Corporation. Active Employees of Quali-Cast Corporation on
September 19, 1987 shall be 100% vested in the Matching Contributions as
of September 19, 1987 and shall receive such benefits at such times as
they become entitled to them under the normal terms of such Plan.
18.28 Anchor Electric. Active Employees of Anchor Electric on November 6,
1987 shall be 100% vested in the Matching Contributions as of November
6, 1987 and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.29 BIF. Active Employees of BIF involuntarily terminated after December 1,
1987 as a result of the closing of the BIF facility at West Warwick,
R.I. shall be 100% vested in the Matching Contributions as of the date
each such employee ceases to be employed and shall receive such benefits
at such time as they become entitled to them under the normal terms of
such Plan.
18.30 Marsh Instrument Company. Active Employees of Marsh Instrument Company
on March 17, 1988 shall be 100% vested in the Matching Contributions as
of March 17, 1988 and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan.
18.31 Nelson Electric, Marine Division. Active Employees of Nelson Electric,
Marine Division on March 29, 1988 shall be 100% vested in the Matching
Contributions as of March 29, 1988 and shall receive such benefits at
such times as they become entitled to them under the normal terms of
such Plan.
<PAGE>
18.32 Ultraglas. Active Employees of Ultraglas on January 22, 1988 shall be
100% vested in the Matching Contributions as of January 22, 1988 and
shall receive such benefits at such times as they become entitled to
them under the normal terms of such Plan.
18.33 Ultratech Photomask. Active Employees of Ultratech Photomask on April
1, 1988 shall be 100% vested in the Matching Contributions as of April
1, 1988 and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.34 Ceilcote Company, Inc. Active Employees of Ceilcote Company, Inc. on
April 29, 1988 shall be 100% vested in the Matching Contributions as of
April 29, 1988 and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan or to elect
a trust to trust transfer of their account balances to the Master
Builders Savings Investment Plan.
18.35 Karkar Electronics. Active Employees of Karkar Electronics
involuntarily terminated after June 10, 1988 as a result of the
consolidation of Karkar Electronics into Tau-tron and Telecommunications
Technology or terminated after October 1, 1988 shall be 100% vested in
the Matching Contributions as of the date each such employee ceases to
be employed and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.36 Accutel. Active Employees of Accutel involuntarily terminated after
September 13, 1988 as a result of the announcement of the closing of
<PAGE>
Accutel shall be 100% vested in the Matching Contributions as of the
date each such employee ceases to be employed and shall receive such
benefits at such times as they become entitled to them under the normal
terms of such Plan.
18.37 Northeast Electronics Division. Active Employees of the Concord, New
Hampshire plant of Northeast Electronics Division terminated on and
after October 28, 1988 as a result of the closing of the Concord, New
Hampshire plant of Northeast Electronics Division shall be 100% vested
in the Matching Contributions as of the date each such employee ceases
to be employed and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan.
18.38 Camarillo Plan (Formerly BIF Accutel). Active Employees of the
Camarillo plant involuntarily terminated after November 18, 1988 as a
result of the closing of the Camarillo plant shall be 100% vested in the
Matching Contributions as of the date each such employee ceases to be
employed and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.39 Merrick Corporation. Active Employees of the Merrick Corporation
involuntarily terminated after December 9, 1988 as a result of the
closing of the Merrick office shall be 100% vested in the Matching
Contributions as of the date each such employee ceases to be employed
and shall receive such benefits at such times as they become entitled to
them under the normal terms of such Plan.
18.40 Henschel. Active Employees of Henschel on May 12, 1989 shall be 100%
vested in the Matching Contributions as of May 12, 1989 and shall
receive such benefits at such times as they become entitled to them
under the normal terms of such Plan.
<PAGE>
18.41 Rucker & Kolls. Active Employees of Rucker & Kolls on October 26, 1989
shall be 100% vested in the Matching Contributions as of October 26,
1989 and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.42 Axel Electronics, Inc. Active Employees of Axel Electronics, Inc. on
December 28, 1989 shall be 100% vested in the Matching Contributions as
of December 28, 1989 and shall receive such benefits at such times as
they become entitled to them under the normal terms of such Plan.
18.43 Leeds & Northrup. Active Employees of Leeds & Northrup involuntarily
terminated after February 28, 1990 as a result of the closing of the
Irondale, Alabama facility shall be 100% vested in the Matching
Contributions as of the date each such employee ceases to be employed
and shall receive such benefits as such times as they become entitled to
them under the normal terms of such Plan.
18.44 Aerotron. Active Employees of Aerotron on March 14, 1990 shall be 100%
vested in the Matching Contributions as of March 14, 1990 and shall
receive such benefits at such times as they become entitled to them
under the normal terms of such Plan.
18.45 Ultratech Stepper. Active Employees of Ultratech Stepper whose
employment was terminated between May 1, 1990 and July 9, 1990 in
connection with the proposed consolidation of the GCA and Ultratech
organizations into the GCA/Ultratech unit or involuntarily terminated on
and after July 9, 1990 in connection with the proposed sale of Ultratech
Stepper to New Enterprize Associates, shall be 100% vested in the
Matching Contributions as of the date each such employee ceases to be
employed and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.46 Hevi-Duty, Puerto Rico. Active Employees of Hevi-Duty, Puerto Rico on
May 17, 1990 shall be 100% vested in the Matching Contributions as of
May 17, 1990 and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan.
18.47 Leeds & Northrup. Active Employees of Leeds & Northrup involuntarily
terminated after May 31, 1990 as a result of the closing of the Salt
Lake City plant shall be 100% vested in the Matching Contributions as of
the date each such employee ceases to be employed and shall receive such
benefits at such times as they become entitled to them under the normal
terms of such Plan.
18.48 GCA/Tropel. Active Employees of GCA/Tropel terminated on and after May
31, 1990 in connection with the transfer of its government business
operation to Optimal Technology Incorporated of Rochester, New York
shall be 100% vested in the Matching Contributions as of the date each
such employee ceases to be employed and shall receive such benefits at
such times as they become entitled to them under the normal terms of
such Plan.
18.49 Kayex. Active Employees of Kayex involuntarily terminated after October
19, 1990 as a result of the closing the Spitfire facility shall be 100%
vested in the Matching Contributions as of the date each such employee
ceases to be employed and shall receive such benefits at such times as
they become entitled to them under the normal terms of such Plan.
<PAGE>
18.50 Semiconductor Systems. Active Employees of Semiconductor Systems on
December 3, 1990 shall be 100% vested in the Matching Contributions as
of December 3, 1990 and shall receive such benefits at such times as
they become entitled to them under the normal terms of such Plan.
18.51 General Railway Signal Company. Active Employees of General Railway
Signal Company on March 11, 1991 shall be 100% vested in the Matching
Contributions and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan.
18.52 New York Air Brake Company. Active Employees of New York Air Brake
Company involuntarily terminated on and after December 10, 1990 in
connection with the sale of New York Air Brake Company and active
employees of New York Air Brake Company on the date of sale, January 2,
1991, shall be 100% vested in the Matching Contributions as of either
the date each such employee ceases to be employed or the date of sale,
as applicable, and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan.
18.53 GS Thinfilm. Active Employees of GS Thinfilm involuntarily terminated
on and after October 26, 1990 in connection with the sale of GS Thinfilm
and active employees of GS Thinfilm on the date of sale shall be 100%
vested in the Matching Contributions as of either the date each such
<PAGE>
employee ceases to be employed or the date of sale, as applicable, and
shall receive such benefits at such times as they become entitled to
them under the normal terms of such Plan.
18.54 Merrick Industries, Inc.. Active Employees of Merrick Industries, Inc.
on September 27, 1991 shall be 100% vested in the Matching Contributions
as of September 27, 1991 and shall receive such benefits at such times
as they become entitled to them under the normal terms of such Plan.
18.55 Alarm and Control Product Line of Telecommnications Tech-nology. Active
Employees of the Alarm and Control Product Line of Telecommunications
Technology on January 8, 1992 shall be 100% vested in the Matching
Contributions as of January 8, 1992 and shall receive such benefits at
such times as they become entitled to them under the normal terms of
such Plan.
18.56 Telecommunications Technology. Employees of Telecommunications
Technology who are actively at work on January 27, 1992 and who are
involuntarily terminated on and after January 27, 1992 in connection
with either the sale of Telecommunications Technology or the closing of
the Telecommunications Technology facility shall be 100% vested in the
Matching Contributions as of the date each such employee ceases to be
employed and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.57 Center for Precision Machining of GCA. Active Employees of the Center
for Precision Machining of GCA involuntarily terminated on and after
March 31, 1992 in connection with the sale of the Center for Precision
Machining of GCA and active employees of the Center for Precision
Machining of GCA on the date of sale shall be 100% vested in the
Matching Contributions as of either the date each such employee ceases
to be employed or the date of sale, as applicable, and shall receive
such benefits at such times as they become entitled to them under the
normal terms of such Plan.
18.58 Proportioneer Division of Lightnin. Active employees of the
Proportioneer Division of Lightnin involuntarily terminated on and after
April 13, 1992 in connection with the sale of the Proportioneer Division
of Lightnin and active employees of the Proportioneer Division of
Lightnin on the date of sale shall be 100% vested in the Matching
Contributions as of either the date each such employee ceases to be
employed or the date of sale, as applicable, and shall receive such
benefits at such times as they become entitled to them under the normal
terms of such Plan.
18.59 Switching Products Division of Hevi-Duty/Nelson. Active employees of
the Switching Products Division of Hevi-Duty/Nelson involuntarily
terminated on and after April 13, 1992 in connection with the sale of
the Switching Products Division of Hevi-Duty/Nelson and active employees
of the Switching Products Division of Hevi-Duty/Nelson on the date of
sale shall be 100% vested in the Matching Contributions as of either the
date each such employee ceases to be employed or the date of sale, as
applicable, and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.60 Dynapower/Stratopower. Active employees of Dynapower/ Stratopower
involuntarily terminated on and after April 21, 1992 in connection with
<PAGE>
the relocation of Dynapower/ Stratopower to Charleston, South Carolina
shall be 100% vested in the Matching Contributions as of the date each
such employee ceases to be employed, and shall receive such benefits at
such times as they become entitled to them under the normal terms of
such Plan.
18.61 Ultratech Stepper Division. Active Employees of the Ultratech Stepper
Division on March 5, 1993 shall be 100% vested in the Matching
Contributions as of March 5, 1993 and shall receive such benefits at
such times as they become entitled to them under the normal terms of
such Plan.
18.62 GCA Division and Tropel Division of General Signal Technology
Corporation. Active Employees of the GCA Division and the Tropel
Division involuntarily terminated on and after March 26, 1993 as a
result of the suspension of the Andover, Massachusetts production
operations shall be 100% vested in the Matching Contributions as of the
date each such employee ceases to be employed and shall receive such
benefits at such times as they become entitled to them under the normal
terms of such Plan.
18.63 Electroglas Division. Active Employees of the Electroglas Division on
June 30, 1993 shall be 100% vested in the Matching Contributions as of
June 30, 1993 and shall receive such benefits at such times as they
become entitled to them under the normal terms of such Plan.
18.64 Drytek, Incorporated. Active Employees of Drytek, Incorporated on June
30, 1993 shall be 100% vested in the Matching Contributions as of June
30, 1993 and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.65 DeZurik, La Grange, Georgia. Active Employees of DeZurik, La Grange,
Georgia, involuntarily terminated as a result of the closing of the
DeZurik, La Grange, Georgia facility, shall be 100% vested in the
Matching Contributions as of the date each such employee ceases to be
employed and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.66 Dielectric Communications. Active employees of Dielectric
Communications involuntarily terminated after December 1, 1993 as a
result of the closing of the Dielectric Communications facility at
Voorhees, New Jersey shall be 100% vested in the Matching Contributions
as of the date each such employee ceases to be employed and shall
receive such benefits at such times as they become entitled to them
under the normal terms of such Plan.
18.67 Lindberg / Revco. Active employees of the Blue M facility of
Lindberg/Revco at Blue Island, Illinois involuntarily terminated as a
result of the closing of the facility shall be 100% vested in the
Matching Contributions as of the date each employee ceases to be
employed and shall receive such benefits at such times as they become
entitled to them under the normal terms of such Plan.
18.68 GCA Tropel. Active employees of GCA Tropel involuntarily terminated in
connection with the sale of GCA Tropel on April 22, 1994 shall be 100%
vested in the Matching Contributions as of the date of sale and shall
receive such benefits at such times as they become entitled to them
under the normal terms of such Plan.
<PAGE>
ARTICLE XIX
AMENDMENT, TERMINATION AND MERGER
19.1 The Company, by action of the Board of Directors, at any time or from
time to time may amend or modify the Plan to any extent that it may deem
advisable. The Board may adopt amendments to the Plan which it deems
necessary or appropriate to comply with applicable laws or government
regulations or which do not materially increase the annual cost of the
Plan to the Employers. No such amendment shall:
(1) increase the duties and responsibilities of the Trustee without its
consent;
(2) have the effect of revesting in any Employer the whole or any part
of the principal or income of the Trust fund or of diverting any
part of such principal or income to purposes other than for the
exclusive benefit of the Members and their Beneficiaries; or
(3) cause any reduction to any Member's Accounts.
19.2 The Company, by action of the Board of Directors, at any time may
discontinue all Contributions under the Plan or terminate the Plan in
its entirety. Each Employer may, by action of its Board of Directors,
take similar action as to Members who are its employees. Upon complete
discontinuance of contributions under the Plan or termination of the
Plan as to any Members hereunder, the Accounts of such Members will
become fully vested, and will not thereafter be subject to forfeiture.
19.3 No merger or consolidation with, or transfer of assets or liabilities
to, any other plan shall occur unless each Member of the Plan would (if
the Plan then terminated) receive a benefit immediately after the
merger, consolidation or transfer which is equal to or greater than the
benefit he would have been entitled to receive immediately before the
merger, consolidation, or transfer (if the Plan had then terminated).
<PAGE>
ARTICLE XX
TRANSFERS OF ACCOUNTS FROM OTHER PLANS
20.1 Purpose of this Article. The purpose of this Article is to specify the
provisions governing Account balances that represent assets transferred
to this Plan (the "Transferred Assets") from other defined contribution
plans that are qualified under Section 401(a) of the Code and whose
assets were exempt from tax under Section 501(a) of the Code (an "Other
Plan"). For purposes of this Article, a distribution to an individual
from an Other Plan which is transferred to this Plan by such individual
in a transfer intended to qualify for tax-free rollover treatment
pursuant to Section 402(a)(5) or 408(d)(3) of the Code shall be
considered a transfer of assets from such Other Plan.
20.2 Approval of Transfers. The Board, in its discretion, may approve from
time to time the transfer of assets from an Other Plan, provided that
the transfer satisfies the requirements of Section 19.3 of this Plan and
does not adversely affect the tax qualified status of this Plan. If the
Other Plan is not maintained by a member of the Controlled Group, the
Board must receive an affidavit from the trustee and plan administrator
of the Other Plan to the effect that such Other Plan is qualified, its
assets are exempt from federal income tax and the transfer will not
adversely affect such status or, in the alternative, that the assets to
be transferred constitute a "qualified total distribution" as defined in
Section 402(a)(5)(E) of the Code; provided, however, that if the
transfer to this Plan is intended to qualify as a tax-free rollover from
an individual retirement account or annuity under Section 408(d)(3) of
the Code, the Board may instead require the individual requesting the
transfer to supply such affidavits or other evidence as the Board may
deem appropriate to establish that the transfer will satisfy the
requirements for such a tax-free rollover. The Board, in its discretion,
may require approval of the transaction by the Internal Revenue Service
prior to accepting any such transfer.
20.3 Membership in the Plan. No assets may be transferred to this Plan from
an Other Plan unless each individual who has an interest in the
Transferred Assets is or was an employee of the Controlled Group. Each
individual who has an interest in the Transferred Assets shall become a
Member of this Plan with the following rights:
(a) If the individual satisfies the requirements for membership
specified in Article III, he will have all the rights of a Member;
(b) If the individual has not satisfied the requirements for membership
specified in Article III, he will have the right of a Member only as
to the Accounts maintained on his behalf to account for the
Transferred Assets (i.e., rights pertaining to investment,
withdrawal and distribution of such Accounts).
20.4 Allocation of Transferred Assets. Each Member's interest in the
Transferred Assets and any earnings thereon will be separately accounted
for and allocated to the Member's Accounts as follows:
(a) To the Member's Tax Deferred Contribution Account - All Transferred
Assets representing (1) contributions that were made to an Other
<PAGE>
Plan maintained by a member of the Controlled Group and that were
not includible in the Member's gross income under the Code in the
year for which they were contributed or thereafter and (2) earnings
on such contributions will be allocated to the Member's Tax Deferred
Contribution Account; and
(b) To the Member's Taxed Contribution Account - The balance of the
Member's interest in the Transferred Assets and all Transferred
Assets from an Other Plan not maintained by a member of the
Controlled Group will be allocated to his Taxed Contribution
Account.
Transferred Assets allocated to an Account will be governed by all of
the rules applicable to that Account. The allocation of Transferred
Assets to the Member's Accounts will not be considered a Tax Deferred
contribution for purposes of Section 4.6(b)(1) (regarding compliance
with the deferral percentage limitations imposed by Section 401(k)(3))
nor an Account Addition for purposes of Section 6.3 (regarding the
limitations imposed by Section 415 of the Code). Unless otherwise
determined by the Board, a distribution from a Member's Accounts will be
deemed to be made first from Transferred Assets allocated to the
Account.
20.5 Special Rule for Distributions at Termination of Employment Under
Section 10.2. If a Member's Tax Deferred Contribution Account contains
any Transferred Assets and he is entitled to a distribution from the
Plan pursuant to Section 10.2, then, instead of the distribution
elections specified in Section 10.2, a terminating Member may elect to
receive the portion of his Accounts representing the Transferred Assets,
determined as of the Valuation Date which coincides with or immediately
follows the date of his termination of employment, and the payment of
the balance of his Accounts at a later date in accordance with Section
10.2(c).
20.6 Provisions of Other Plan Superseded. The provisions of this Plan will
supersede the provisions of any Other Plan with respect to the
Transferred Assets. In particular, all beneficiary designations and
other elections made under the Other Plan will be cancelled effective as
of the date such Other Plan assets are transferred to this Plan and made
a part of the Trust Fund. Upon the Member's death, the amount in his
Accounts representing Transferred Assets will be paid to the Beneficiary
designated under this Plan in accordance with Sections 10.1, 10.4(a)(i)
and 18.8.
<PAGE>
ARTICLE XXI
TOP-HEAVY PROVISIONS
21.1 Top-Heavy Determination. Notwithstanding any other provision of this
Plan to the contrary, this Article XXI shall apply for any Plan Year if
the Plan is a "Top-Heavy Plan" as defined herein. The Plan shall be a
"Top-Heavy Plan" if, as of the Determination Date, the present value of
the cumulative accrued benefits of Key Employees exceeds sixty percent
(60%) of the present value of the cumulative accrued benefits under the
Plan of all Employees (but excluding the value of the accrued benefits
of the Non-Key Employees who were formerly Key Employees). In
determining whether this Plan is a Top-Heavy Plan, the Company and all
members of the Controlled Group shall be treated as a single employer.
In addition, all plans that are part of the Aggregation Group shall be
treated as a single plan.
For purposes of the foregoing, the present value of an Employee's
accrued benefit shall be equal to the sum of the amounts determined
under the following paragraphs:
(a) The sum of (i) the present value of an Employee's accrued benefits
in each defined benefit plan which is included in the Aggregation
Group determined as of the most recent Valuation Date within the
twelve (12) month period ending on the Determination Date and as if
the Employee had terminated service as of such Valuation Date and
(ii) the aggregate distributions made with respect to such Employee
during the five-year period ending on the Determination Date from
all defined benefit plans included in the Aggregation Group and not
reflected in the present value of his accrued benefits as of the
most recent Valuation Date; and
(b) The sum of (i) the aggregate balance of his accounts in all defined
contribution plans which are part of the Aggregation Group as of the
most recent Valuation Date within the twelve (12) month period
ending on the Determination Date, (ii) any contributions allocated
to such accounts after the Valuation Date and on or before the
Determination Date and (iii) the aggregate distributions made with
respect to such Employee during the five-year period ending on the
Determination Date from all defined contribution plans which are
part of the Aggregation Group and not reflected in the value of his
accounts as of the most recent Valuation Date.
Solely for the purpose of determining if the Plan, or any other plan
included in a required aggregation group of which this Plan is a
part, is top - heavy (within the meaning of Section 416(g) of the
Code) the accrued benefit of an Employee other than a key employee
(within the meaning of Section 416(i)(1) of the Code) shall be
determined under (a) the method, if any, that uniformly applies for
accrual purposes under all plans maintained by the Controlled Group,
or (b) if there is no such method, as if such benefit accrued not
more rapidly than the slowest accrual rate permitted under the
fractional accrual rate of Section 411(b)(1)(C) of the Code.
<PAGE>
Plan-to-plan transfers and rollovers shall be taken into
account to the extent provided in the applicable Treasury
Regulations. In addition, for purposes of paragraphs (a)(ii) and
(b)(iii) above, distributions under a terminated plan which, if such
plan had not terminated, would have been required to be included in
an Aggregation Group, shall also be taken into account.
21.2 Top-Heavy Definitions. The following terms shall have the following
meanings:
(a) "Aggregation Group" means
(i) Each stock bonus, pension, or profit sharing plan of the
Company in which a Key Employee participates and which is
intended to qualify under Section 401(a) of the Code; and
(ii) Each other such stock bonus, pension or profit sharing
plan of the Company which enables any plan in which a Key
Employee participates to meet the requirements of Section
401(a)(4) or 410 of the Code; and
(iii) Each other such stock bonus, pension or profit sharing
plan of the Company which the Company designates as part
of the Aggregation Group provided that the resulting group
meets the requirements of Section 401(a) and 410 of the
Code.
(b) "Determination Date" means the last day of the preceding Plan Year,
except that for the first plan year of any plan, the Determination
Date shall be the last day of such plan year.
(c) "Key Employee" means any Employee, former Employee, or the
beneficiary under the Plan of a former Employee who, in the Plan
Year containing the Determination Date, or any of the four preceding
Plan Years, is:
(i) An officer of the Company having an annual compensation
greater than 150% of the maximum dollar limitation under
Section 415(c)(1)(A) of the Code. Not more than fifty
(50) Employees or, if lesser, the greater of three (3)
Employees or ten percent (10%) of the Employees shall be
considered as officers for purposes of this paragraph.
(ii) One of the ten (10) Employees owning (or considered as
owning within the meaning of Section 318 of the Code) the
largest interest in the Company and having an annual
compensation greater than the maximum dollar limitation
under Section 415(c)(1)(A) of the Code.
(iii) A five-percent (5%) owner of the Company.
(iv) A one-percent (1%) owner of the Company having an annual
compensation of more than $150,000.
An Employee's ownership interest in the Company shall be
determined in accordance with Section 416(i) of the Code.
<PAGE>
(d) "Non-Key Employees" means any Employee, former Employee, or the
beneficiary under the Plan of a former Employee who is not a Key
Employee.
<PAGE>
(e) "Compensation" means compensation as defined in Section 415 of the
Code.
21.3 Minimum Top-Heavy Contribution. If this Article XXI applies to the Plan
for any Plan Year, the Company contribution to the Plan (including Tax
Deferred Contributions) and all other defined contribution plans
included in the Aggregation Group for such Plan Year on behalf of each
Non-Key Employee who is a Member of this Plan, whether or not such Non-
Key Employee elects to make Tax Deferred Contributions to the Plan for
such Plan Year, shall not in the aggregate be less than the lesser of
(i) three percent (3%) of such Non-Key Employee's compensation, or (ii)
the percentage of compensation contributed, or required to be contri-
buted, by the Company in the aggregate to the Plan and all other defined
contribution plans in the Aggregation Group for such Plan Year on behalf
of the Key Employee for whom such percentage is the highest
(disregarding for this purpose compensation of such Key Employee for
such Plan Year in excess of $200,000, as adjusted for cost-of-living
increases to the extent permitted pursuant to Section 416(d)(2) of the
Code), multiplied by such Non-Key Employee's compensation. If the amount
contributed in the aggregate on behalf of any Non-Key Employee under the
Plan and all other defined contribution plans in the Aggregation Group
would otherwise be less than the minimum contribution required by this
Section 21.3, an additional contribution shall be made to such plan or
plans as the Company shall designate so that the minimum contribution
requirement set forth in this Section 21.3 is satisfied. This Section
21.3 shall not apply to any Non-Key Employee who is a participant in any
defined benefit plan included in the Aggregation Group under which such
Non-Key Employee receives the minimum benefit required by Section 416 of
the Code and applicable Treasury Regulations.
21.4 Top-Heavy Vesting Requirements.
(a) If this Article XXI applies to the Plan for any Plan Year, then
notwithstanding the provisions of Section 8.1, a Member's
nonforfeitable interest in his Accounts attributable to Company
contributions shall not be less than the appropriate percentage set
forth below:
Full Years
of Continuous Nonforfeitable
Employment Percentage
Less than 2 0%
2 20
3 40
4 60
5 80
6 or more 100
<PAGE>
(b) A Member's nonforfeitable interest in his Accounts shall not be less
than the greater of (i) his nonforfeitable interest determined
pursuant to Section 8.1 or (ii) his nonforfeitable interest
determined pursuant to this Section 21.4 as of the last day of the
last Plan Year in which this Article XXI applies to the Plan.
(c) If this Article XXI ceases to apply to the Plan, each Member having
five or more full years of Continuous Employment (determined as of
the first day of the Plan Year in which the Article XXI ceases to
apply to the Plan) shall have his nonforfeitable interest determined
in accordance with the schedule contained in this Section 21.4 if
such schedule results in a higher nonforfeitable interest than that
determined under Section 8.1.
21.5 Top-Heavy Section 415 Limitation. If this Article XXI applies to the
Plan for any Plan Year, then the defined benefit plan fraction and
defined contribution plan fraction applied under Section 6.3(d) shall be
applied by substituting "1.0" for "1.25" in each place such number
appears in Section 415(e) of the Code, unless the following requirements
are met:
(1) The defined benefit plan or plans of the Company in which each Non-
Key Employee participates provides a benefit on his behalf not less
than the minimum benefit required under Section 416(b) of the Code
and Treasury Regulations thereunder.
(2) This Article XXI would not apply if "ninety percent (90%)" were
substituted for "sixty percent (60%)" in each place such term
appears in Section 21.1.
This Section 21.5 shall not apply to any Member as long as there are (i)
no Company contributions, forfeitures or voluntary contributions
allocated to such Member under any defined contribution plan of the
Company and (ii) no accruals for such Member under any defined benefit
plan of the Company.
21.6 Top-Heavy Compensation Limit. If this Article XXI applies to the Plan
for any Plan Year, the annual compensation of each Employee taken into
account under the Plan shall not exceed $200,000, as adjusted for cost-
of-living increases to the extent permitted pursuant to Section
416(d)(2) of the Code.
<PAGE>
