<PAGE>
As filed with the Securities and Exchange Commission on August 6, 1996
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------
HAWAIIAN AIRLINES, INC.
(Exact Name of Registrant as Specified in Its Charter)
---------------------
HAWAII 99-0042880
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
---------------------
3375 Koapaka Street
Suite G350
Honolulu, Hawaii 96819
(Address of Principal Executive Offices) (Zip Code)
---------------------
HAWAIIAN AIRLINES, INC.
PILOTS' 401(k) PLAN
(Full Title of the Plan)
---------------------
Rae A. Capps, Esq.
Vice President, General Counsel and Corporate Secretary
3375 Koapaka Street
Suite G350
Honolulu, Hawaii 96819
(Name and Address of Agent For Service)
---------------------
(808) 835-3700
Telephone Number, Including Area Code, of Agent For Service
---------------------
WITH A COPY TO:
Joseph Salamunovich, Esq.
Gibson, Dunn & Crutcher LLP
333 South Grand Avenue
Los Angeles, California 90071
(213) 229-7000
---------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------
Title of Securities Amount to Proposed Maximum Proposed Maximum Amount of
to be Registered be Registered Offering Price Per Aggregate Registration
Share Offering Price Fee
<S> <C> <C> <C> <C>
- ---------------------------------------------------------------------------------------------
Common Stock 487,820(1) $3.69(2) $1,800,056.00(2) $621.00(2)
- ---------------------------------------------------------------------------------------------
Preferred Stock
Purchase Rights 487,820(3) $0.00 $0.00 $0.00
- ---------------------------------------------------------------------------------------------
</TABLE>
(1) These shares are issued and reserved for issuance pursuant to the
Hawaiian Airlines, Inc. Pilots' 401(k) Plan (the "Plan"). Pursuant to
Rule 416, also being registered are additional shares of Common Stock as
may become available under the Plan through the operation of
anti-dilution provisions.
(2) Estimated in accordance with Rule 457(h) and Rule 457(c) of the
Securities Act of 1933, as amended solely for the purpose of calculating
the registration fee, as follows: $1,800,056.00 with respect to 487,820
shares of Common Stock, based on a price of $3.69 per share, the
average of the high and low trading prices of the Common Stock of
Hawaiian Airlines, Inc. (the "Company") on the American Stock Exchange
on August 5, 1996.
(3) These Preferred Stock Purchase Rights attach to each share of
Common Stock upon issuance.
<PAGE>
EXPLANATORY NOTE
This Registration Statement is being filed by Hawaiian Airlines, Inc.
("Hawaiian" or the "Company") in order to register 487,820 shares of Common
Stock (the "Common Stock" or the "Securities") which have been reserved for
issuance under the Hawaiian Airlines, Inc. Pilots' 401(k) Plan, as amended
(the "Plan") (including 487,820 Preferred Stock Purchase Rights (the
"Rights"), one of which attaches to each share of Common Stock issued,
pursuant to the Rights Agreement dated as of December 23, 1994, as amended by
and between the Company and Chemical Trust Company of California, as Rights
Agent). The additional shares of Common Stock that may become available for
purchase in accordance with the provisions of the Plan in the event of
certain changes in the outstanding shares of Common Stock of Hawaiian,
including, among other things, stock dividends, stock splits, reverse stock
splits, reorganizations and recapitalizations, are also being registered.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents heretofore filed by the Company with the
Commission are by this reference incorporated in and made a part of this
Registration Statement:
(1) The Company's Annual Report on Form l0-K for the fiscal year
ended December 31, 1995, including the Financial Statements and the Financial
Statement Schedule and the Reports of KPMG Peat Marwick LLP, Independent
Auditors filed April 1, 1996, as amended by Amendment No. 1 on Form 10-K/A
and Amendment No. 2 on Form 10-K/A;
(2) The Quarterly Report on Form 10-Q, filed May 15, 1996, for the
period ended March 31, 1996;
(3) The Current Report on Form 8-K filed January 10, 1996 (date of
event January 10, 1996);
(4) The Current Report on Form 8-K filed January 17, 1996 (date of
event January 15, 1996);
(5) The Current Report on Form 8-K filed January 23, 1996 (date of
event January 18, 1996);
(6) The Current Report on Form 8-K filed February 1, 1996 (date of
event January 30, 1996);
(7) The Current Report on Form 8-K filed February 2, 1996 (dated
January 31, 1996);
(8) The Current Report on Form 8-K filed February 7, 1996 (dated
February 2, 1996);
(9) The Registration Statement on Form S-2 filed May 30, 1996, as
amended by Amendment No. 1 filed July 12, 1996, as amended by Amendment No. 2
filed July 19, 1996, as amended by Amendment No. 3 filed July 23, 1996, as
amended by Amendment No. 4 filed July 24, 1996, as amended by Amendment No. 5
filed August 1, 1996 (Registration No. 333-04817);
(10) The Registration Statement on Form 8-A/A filed July 1, 1996; and
(11) All documents filed by the Company pursuant to Section 13(a),
13(c), 14 or 15(d) of the Exchange Act after the date of this Registration
Statement and prior to the filing of a post-effective amendment which
indicates that all Securities offered hereby have been sold or which
deregisters all Securities then remaining unsold.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or
is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this
Registration Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
The validity of the Common Stock has been passed upon for the
Company by Rae A. Capps, its Vice President, General Counsel and Corporate
Secretary. Ms. Capps owns no shares of Common Stock.
II-1
<PAGE>
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Section 415-5 of the Hawaii Business Corporation Act (the "Hawaii
Indemnification Statute") provides that a corporation may indemnify any
person who was or is a party to or is threatened to be made a party to any
proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the corporation), by reason of the fact
that the person was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation in such a
capacity with another enterprise (such person being hereinafter referred to
as the "Indemnitee"). The indemnity may cover expenses (including attorneys'
fees), judgments, fines, settlements and other amounts actually and
reasonably incurred in connection with such proceeding if the Indemnitee
acted in good faith and in a manner the Indemnitee reasonably believed to be
in, or not opposed to, the best interests of the corporation and, with
respect to any criminal action or proceedings, had no reasonable cause to
believe the Indemnitee's conduct was unlawful.
Section 415-48.5 of the Hawaii Business Corporation Act ("HBCA")
provides that a corporation does not have the power to eliminate or limit the
personal liability of a director for (a) any breach of the director's duty of
loyalty to the corporation or its shareholders, (b) any act or omission of
the director not performed in good faith, or which involves intentional
misconduct or knowing violation of the law, or which constitutes a willful or
reckless disregard of the director's fiduciary duty, (c) the director's
willful or negligent violation of any provision of the HBCA regarding payment
of dividends or stock purchase or redemption, or (d) any transaction from
which the director received an improper benefit.
The Hawaii Indemnification Statute also provides that, in the case of an
action or suit by or on behalf of the corporation, the corporation has the
power to indemnify an Indemnitee against expenses (including attorneys' fees)
actually and reasonably incurred in connection with the defense or settlement
of such action or suit if the Indemnitee acted in good faith and in a manner
the Indemnitee reasonably believes to be in, or not opposed to, the best
interests of the corporation, except that no indemnification may be made in
respect to any claim, issue or matter as to which the Indemnitee had been
adjudged to be liable for negligence or misconduct in the performance of the
Indemnitee's duties to the corporation unless, and only to the extent that,
the court in which the action or suit was brought determines that, despite
the adjudication of liability, but in view of all circumstances of the case,
the Indemnitee is fairly and reasonably entitled to indemnity for such
expenses as such court deems proper. The provision does not, however,
expressly authorize the corporation to indemnify the Indemnitee against
judgments, fines and amounts paid in settlement arising out of a
shareholder's derivative action.
The Hawaii Indemnification Statute further provides that indemnification
is mandatory with respect to expenses incurred in connection with any action,
suit or proceeding, to the extent the Indemnitee is successful on the merits
or otherwise in defense of any such action or claim.
The Hawaii Indemnification Statute allows the payment by the corporation
of expenses incurred by an Indemnitee in advance of the final disposition of
an action, suit or proceeding if the Indemnitee provides an undertaking of
repayment. Additionally, it provides that the indemnity provided by the
statute is not exclusive of any other rights to which an Indemnitee may be
entitled under any bylaw, agreement, vote of shareholders or disinterested
directors or otherwise. It also provides that a corporation may purchase
insurance for officers or directors of the corporation.
Article VII of the Registrant's Amended Articles of Incorporation
incorporates the provisions of the Hawaii Indemnification Statute so as to
provide the indemnification of the Hawaii Indemnification Statute to officers
and directors of the Company. Article VII also provides that the indemnity
provided thereunder is nonexclusive of any other rights of indemnification to
which an Indemnitee may be entitled.
In addition, the Registrant has entered into indemnification agreements
with each of its directors and executive officers providing indemnification
to the fullest extent permitted by law. Furthermore, the Registrant has a
policy of directors' and officers' liability insurance which insures
directors and officers against the cost of defense, settlement or payment of
a judgment under certain circumstances.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
None.
II-2
<PAGE>
ITEM 8. EXHIBITS.
Exhibit No. Description
----------- -----------
4.1 Rights Agreement dated December 23, 1994. (1)
4.2 Amendment No. 1 dated as of May 4, 1995 to Rights Agreement
dated as of December 23, 1994 by and between Hawaiian
Airlines, Inc. and Chemical Trust Company of California. (2)
4.3 Amendment No. 1 to 1994 Stock Option Plan dated as of May 4,
1995. (2)
4.4 Amendment No. 1 dated as of May 4, 1995 to
Warrants Nos. 1-10. (2)
4.5 1994 Stock Option Plan. (3)
4.6 Rightsholders Agreement dated as of January 31, 1996, by and
among Hawaiian Airlines, Inc., Airline Investors Partnership,
L.P., AMR Corporation, Martin Anderson and Robert Midkiff. (4)
4.7 Amendment No. 2 to the Rights Agreement, as amended, dated as
of January 31, 1996 by and between Hawaiian Airlines, Inc.
and Chemical Trust Company of California. (4)
4.8 Amendment No. 2 to 1994 Stock Option Plan, as amended, dated
as of December 8, 1995. (4)
4.9 The Company agrees to provide the Securities and Exchange
Commission, upon request, copies of instruments defining the
rights of security holders of long-term debt of the Company.
5.1 Opinion of Rae A. Capps, Esq.
23.1 Consent of KPMG Peat Marwick LLP
23.2 Consent of Rae A. Capps, Esq. (included in Exhibit 5.1)
24.1 Power of Attorney (included on Signature Pages)
99.1 Hawaiian Airlines, Inc. Pilots' 401(k) Plan
________________________________
(1) Previously filed with the Securities and Exchange Commission as an
exhibit to the Company's Current Report on Form 8-K as filed January 5, 1995
and incorporated herein by reference.
(2) Previously filed with the Securities and Exchange Commission as an
exhibit to the Company's Quarterly Report on Form 10-Q as filed August 14,
1995 and incorporated herein by reference.
(3) Previously filed with the Securities and Exchange Commission as an
exhibit to the Company's Registration Statement on Form S-8 as filed November
15, 1995 and incorporated herein by reference.
II-3
<PAGE>
(4) Previously filed with the Securities and Exchange Commission as an
exhibit to the Company's Annual Report on Form 10-K as filed April 1, 1996
and incorporated herein by reference.
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement;
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in
the aggregate, represent a fundamental change in the information
set forth in the registration statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities offered
(if the total dollar value of securities offered would not exceed
that which was registered) and any deviation from the low or high
end of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement;
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial BONA FIDE offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at the time shall be deemed to be the initial BONA
FIDE offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrant pursuant to the foregoing
provisions, or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification
is against public policy as expressed in the Act and is, therefore,
unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses
incurred or paid by a director, officer or controlling person of the
registrant in the successful defense of any action, suit or proceeding)
is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will,
unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of
such issue.
(d) Pursuant to the instructions to Item 8(b) of Form S-8, the
registrant will cause Hawaiian Airlines, Inc. Pilots' 401(k) Plan, as
amended since its most recent determination letter, to be
II-4
<PAGE>
submitted to the Internal Revenue Service in a timely manner and will
make all changes required by the Internal Revenue Service in order to
qualify said Plan.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly
caused this registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City and County of
Honolulu, State of Hawaii, on this 6th day of August, 1996.
HAWAIIAN AIRLINES, INC.
By: /s/ Bruce R. Nobles
---------------------------------------
Bruce R. Nobles
President and Chief Executive Officer
II-6
<PAGE>
POWER OF ATTORNEY
Each person whose signature appears below constitutes and
appoints Bruce R. Nobles, John L. Garibaldi, Rae A. Capps and Clarence
K. Lyman his or her true and lawful attorneys-in-fact and agents, each
acting alone, with full powers of substitution and resubstitution, for
him or her and in his or her name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective
amendments) to this registration statement, and to file the same, with
all exhibits thereto, and other documents in connection therewith, with
the Securities and Exchange Commission, granting unto said
attorneys-in-fact and agents, each acting alone, full powers and
authority to do and perform each and every act and thing requisite and
necessary to be done in and about the premises, as fully to all intents
and purposes as he or she might, or could do in person, hereby ratifying
and confirming all that said attorneys-in-fact and agents, each acting
alone, or his or her substitute or substitutes may lawfully do or cause
to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this registration statement has been signed below by the following
persons in the capacities and on the date indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------------------------------------- --------------------------------------- ---------------------------------------
<S> <C> <C>
/s/ Bruce R. Nobles Director, President and Chief Executive August 6, 1996
----------------------------------- Officer (Principal Executive Officer)
Bruce R. Nobles
/s/ John L. Garibaldi Executive Vice President and Chief
----------------------------------- Financial Officer (Principal August 6, 1996
John L. Garibaldi Financial and Accounting Officer)
/s/ John W. Adams Director, Chairman of the Board August 6, 1996
-----------------------------------
John W. Adams
/s/ Todd G. Cole Director August 6, 1996
-----------------------------------
Todd G. Cole
/s/ Richard F. Conway Director August 6, 1996
-----------------------------------
Richard F. Conway
/s/ Robert G. Coo Director August 6, 1996
-----------------------------------
Robert G. Coo
/s/ Carol A. Fukunaga Director August 6, 1996
-----------------------------------
Carol A. Fukunaga
/s/ William Boyce Lum Director August 6, 1996
-----------------------------------
William Boyce Lum
/s/ Richard K. Matros Director August 6, 1996
-----------------------------------
Richard K. Matros
/s/ Reno F. Morella Director August 6, 1996
-----------------------------------
Reno F. Morella
/s/ Samson Poomaihaelani Director August 6, 1996
-----------------------------------
Samson Poomaihaelani
/s/ Edward Z. Safady Director August 6, 1996
-----------------------------------
Edward Z. Safady
</TABLE>
II-7
<PAGE>
August 6, 1996
Hawaiian Airlines, Inc.
3375 Koapaka Street
Suite G350
Honolulu, HI 96819
Re: REGISTRATION STATEMENT ON FORM S-8
Ladies and Gentlemen:
I have acted as counsel for Hawaiian Airlines, Inc., a Hawaii
corporation (the "Company"), in connection with the registration of 487,820
shares of Common Stock (the "Common Stock") of the Company issuable under its
Hawaiian Airlines, Inc. Pilots' 401(k) Plan (the "Plan"). In connection
therewith, I have examined, among other things, the Registration Statement on
Form S-8 (the "Registration Statement") proposed to be filed by the Company
with the Securities and Exchange Commission on or about August 6, 1996. I
have also examined the proceedings and other actions taken by the Company in
connection with the authorization and reservation of the shares of Common
Stock issuable under the Plan and such other matters as I deemed necessary
for purposes of rendering this opinion.
Based upon the foregoing, and in reliance thereon, I am of the opinion
that the shares of Common Stock issuable under the Plan, when issued,
delivered and paid for in accordance with the Plan and the agreements
evidencing awards thereunder and in the manner described in the Registration
Statement, will be validly issued, fully paid and nonassessable.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement.
Very truly yours,
/s/ Rae A. Capps.
Rae A. Capps
RAC/hjh
<PAGE>
EXHIBIT 23.1
The Board of Directors
Hawaiian Airlines, Inc.:
We consent to incorporation by reference in the Registration Statement on
Form S-8 of Hawaiian Airlines, Inc., registering 487,820 shares of Common
Stock and 487,820 Preferred Stock Purchase Rights pursuant to the Hawaiian
Airlines, Inc. Pilots' 401(k) Plan, of our reports dated March 15,
1996, relating to the balance sheets of Hawaiian Airlines, Inc. as of
December 31, 1995 and 1994, and the related statements of operations,
shareholders' equity (deficit) and cash flows for the year ended December 31,
1995, the period September 12, 1994 through December 31, 1994, the period
January 1, 1994 through September 11, 1994, and for the year ended
December 31, 1993, and relating to the financial statement schedule for the
three-year period ended December 31, 1995, which reports appear in the
December 31, 1995 annual report on Form 10-K of Hawaiian Airlines, Inc.
Our reports dated March 15, 1996, indicate that the financial statements of
the Reorganized Company reflect the impact of adjustments to reflect the fair
value of assets and liabilities under fresh start accounting and, as a
result, the financial statements of the Reorganized Company are presented on
a different basis than those of the Predecessor Company.
In addition, our reports dated March 15, 1996, contain an explanatory
paragraph that states that the Company's recurring losses from operations,
deficit working capital and limited sources of additional liquidity raise
substantial doubt about its ability to continue as a going concern. The
financial statements and financial statement schedule do not include any
adjustments that might result from the outcome of that uncertainty.
/s/ KPMG Peat Marwick LLP
Honolulu, Hawaii
August 6, 1996
<PAGE>
ID #6398s
12/94
HAWAIIAN AIRLINES, INC.
PILOTS' 401(K) PLAN
EFFECTIVE: SEPTEMBER 1, 1990
<PAGE>
TABLE OF CONTENTS
ARTICLE 1
NAME AND PURPOSE
1.1 NAME 2
1.2 PURPOSE 2
ARTICLE 2
DEFINITIONS
2.1 ACCOUNTS 3
2.2 ACTUAL DEFERRAL PERCENTAGE 3
2.3 ALTERNATE PAYEE 3
2.4 ASSOCIATION 3
2.5 AVERAGE ACTUAL DEFERRAL PERCENTAGE 3
2.6 BENEFICIARY 3
2.7 CODE 4
2.8 COMPENSATION 4
2.9 DEFERRED RETIREMENT DATE 5
2.10 DISABILITY RETIREMENT DATE 5
2.11 DOMESTIC RELATIONS ORDER 5
2.12 EARLY RETIREMENT DATE 5
2.13 EMPLOYEE 5
2.14 EMPLOYER 6
2.15 EMPLOYER CONTRIBUTION ACCOUNT 6
2.16 EMPLOYER CONTRIBUTIONS 6
2.17 EMPLOYER STOCK 6
2.18 ERISA 6
2.19 EXCESS CONTRIBUTIONS 6
2.20 EXCESS ELECTIVE DEFERRALS 6
2.21 FAMILY MEMBER 6
2.22 HIGHLY COMPENSATED EMPLOYEE 7
2.23 HOUR OF SERVICE 7
2.24 MARRIED PARTICIPANT 8
2.25 NORMAL RETIREMENT DATE 9
2.26 PARTICIPANT 9
2.27 PERSON 9
2.28 PLAN 9
2.29 PLAN ADMINISTRATOR 9
2.30 PLAN YEAR 9
2.31 QUALIFIED DOMESTIC RELATIONS ORDER 9
2.32 RETIREMENT BOARD 10
2.33 ROLLOVER ACCOUNT 10
2.34 SALARY DEFERRAL 11
2.35 SALARY DEFERRAL ACCOUNT 11
2.36 STATUTORY COMPENSATION 11
2.37 STOCK FUND 12
2.38 SYSTEM SENIORITY LIST 12
<PAGE>
2.39 TERMINATION OF EMPLOYMENT 12
2.40 TRUST 12
2.41 TRUST AGREEMENT 12
2.42 TRUST FUND 12
2.43 TRUSTEE 12
2.44 VALUATION DATE 12
2.45 VOLUNTARY AFTER TAX CONTRIBUTION ACCOUNT 13
2.46 YEAR OF SERVICE 13
ARTICLE 3
PARTICIPATION
3.1 REQUIREMENTS 14
3.2 DETERMINATION OF ELIGIBILITY 14
ARTICLE 4
CONTRIBUTIONS
4.1 SALARY DEFERRAL CONTRIBUTIONS 15
4.2 VOLUNTARY AFTER TAX CONTRIBUTIONS AND WITHDRAWALS 19
4.3 ROLLOVER CONTRIBUTIONS 19
4.4 EMPLOYER CONTRIBUTIONS 19
4.5 RETURN OF CONTRIBUTIONS 22
4.6 INDIVIDUAL LIMITATIONS ON CONTRIBUTIONS 22
ARTICLE 5
ALLOCATIONS TO PARTICIPANTS' ACCOUNT
5.1 SEPARATE ACCOUNTS 23
5.2 ALLOCATION RULES 23
ARTICLE 6
VESTING
6.1 VESTING OF SALARY DEFERRAL ACCOUNT 28
6.2 VESTING OF VOLUNTARY AFTER TAX CONTRIBUTION ACCOUNT 28
6.3 VESTING OF ROLLOVER CONTRIBUTION ACCOUNT 28
6.4 VESTING OF EMPLOYER CONTRIBUTION ACCOUNT 28
ARTICLE 7
INVESTMENT OF ACCOUNTS
7.1 PARTICIPANT-DIRECTED INVESTMENT 29
7.2 INVESTMENT OPTIONS 29
<PAGE>
7.3 FREQUENCY OF CHANGING INVESTMENT OPTIONS 30
7.4 FAILURE TO SELECT INVESTMENT OPTION 30
7.5 INVESTMENT INCOME AND LOSSES 30
7.6 VOTING EMPLOYER STOCK 30
7.7 CONVERSION OF EMPLOYER STOCK TO CASH 31
ARTICLE 8
LIMITATIONS ON CONTRIBUTIONS
8.1 LIMITATION ON ANNUAL ADDITIONS TO THE PLAN - NO
PARTICIPATION IN OTHER DEFINED CONTRIBUTION ARRANGEMENT 32
8.2 LIMITATION ON ANNUAL ADDITIONS TO THE PLAN - PARTICIPATION
IN ANOTHER DEFINED CONTRIBUTION ARRANGEMENT 32
8.3 LIMITATION ON ANNUAL ADDITIONS TO THE PLAN - PARTICIPATION
IN DEFINED BENEFIT PLAN 34
8.4 DEFINITIONS 34
ARTICLE 9
BENEFICIARIES
9.1 DESIGNATION 39
9.2 FAILURE TO DESIGNATE 39
9.3 BENEFICIARIES BOUND BY PLAN 39
ARTICLE 10
RETIREMENT BENEFITS
10.1 AMOUNT OF BENEFITS 40
10.2 TIME OF DISTRIBUTION 40
10.3 DEFERRED RETIREMENT 40
ARTICLE 11
DEATH BENEFITS
11.1 DEATH BENEFITS 41
11.2 PROOFS 41
ARTICLE 12
DISABILITY BENEFITS
12.1 AMOUNT OF BENEFITS 42
12.2 TIME OF DISTRIBUTION 42
<PAGE>
ARTICLE 13
EMPLOYMENT TERMINATION BENEFITS
13.1 PARTICIPATION CEASES UPON TERMINATION OF EMPLOYMENT 43
13.2 TIME OF DISTRIBUTION 43
ARTICLE 14
DISTRIBUTIONS TO PARTICIPANTS
14.1 TIME AND METHOD OF PAYMENT 44
14.2 DISTRIBUTION IN CASH 44
14.3 REPURCHASE OF EMPLOYER STOCK 44
14.4 SPECIAL DISTRIBUTION RULES 44
14.5 SECTION 401(a)(31) ELIGIBLE DISTRIBUTIONS 46
ARTICLE 15
INALIENABILITY OF BENEFITS
15.1 INALIENABILITY 48
ARTICLE 16
QUALIFIED DOMESTIC RELATIONS ORDERS
16.1 QUALIFIED DOMESTIC RELATIONS ORDERS 49
16.2 NOTICE AND DETERMINATION 49
16.3 PROCEDURES FOR DETERMINATION 49
16.4 PROCEDURES FOR PERIOD DURING WHICH DETERMINATION IS
BEING MADE 50
16.5 TREATMENT OF FORMER SPOUSE AS A SURVIVING SPOUSE 50
ARTICLE 17
CLAIMS PROCEDURE
17.1 CLAIMS AND DETERMINATION 51
17.2 REVIEW OF DENIAL OF CLAIMS 51
ARTICLE 18
PLAN ADMINISTRATION
18.1 PLAN ADMINISTRATOR 52
18.2 ASSISTANTS OR REPRESENTATIVES 52
18.3 LIABILITY 52
18.4 INDEMNIFICATION 52
18.5 COSTS AND EXPENSES 52
18.6 VOTING RIGHTS 53
<PAGE>
ARTICLE 19
RETIREMENT BOARD
19.1 RETIREMENT BOARD 54
19.2 POWERS OF THE RETIREMENT BOARD 56
19.3 REVIEW FUNCTIONS 56
19.4 EMPLOYER RECORDS 57
ARTICLE 2O
TRUST FUND
20.1 TRUST AGREEMENT 58
ARTICLE 21
TERMINATION AND AMENDMENT
21.1 PLAN TERMINATION 59
21.2 DISCONTINUANCE OF CONTRIBUTIONS 59
21.3 VESTING UPON TERMINATION AND DISCONTINUANCE 59
21.4 MERGER, CONSOLIDATION, OR SALE 59
21.5 VESTED RIGHTS NOT REDUCED ON MERGER, CONSOLIDATION, OR SALE 59
21.6 AMENDMENT 60
ARTICLE 22
LOANS
22.1 AMOUNTS 61
22.2 LOAN TERMS 61
22.3 REDUCTION IN BENEFITS FOR NON-PAYMENT 62
ARTICLE 23
HARDSHIP WITHDRAWALS
23.1 HARDSHIP WITHDRAWALS 63
23.2 TIME OF DISTRIBUTION 63
ARTICLE 24
MISCELLANEOUS
24.1 PLAN NOT AN EMPLOYMENT CONTRACT 64
24.2 GOVERNING LAW 64
24.3 RULE AGAINST PERPETUITIES 64
24.4 USE OF WORDS 64
24.5 INDEPENDENT PROVISIONS 64
24.6 TITLES 64
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APPENDIX 1
DISTRIBUTION REQUIREMENTS
Section 1. General Rules 66
Section 2. Required Beginning Date 66
Section 3. Limits On Distribution Periods 66
Section 4. Death Distribution Provisions 66
Section 5. Definitions 67
Section 6. Proposed Regulations 68
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HAWAIIAN AIRLINES, INC.
PILOTS' 401(K) PLAN
WHEREAS, Hawaiian Airlines, Inc., a corporation organized under the laws
of Hawaii, established a savings plan, effective September 1, 1990, known as
the Hawaiian Airlines, Inc. Pilots' 401(k) Plan (the "Plan") to enable the
employees of Hawaiian Airlines, Inc. who are covered by a collective
bargaining agreement with the Air Line Pilots Association, International to
make tax-deferred salary reduction contributions which will be used to
provide for their retirement income.
NOW THEREFORE, it is hereby agreed that effective as of September 1,
1990 the Hawaiian Airlines, Inc. Pilots' 401(k) Plan is amended and restated
in its entirety to read as herein provided.
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ARTICLE 1
NAME AND PURPOSE
1.1 NAME. The Plan shall be known as the Hawaiian Airlines, Inc.
Pilots' 401(k) Plan.
1.2 PURPOSE.
(A) PROVISION FOR PARTICIPANT'S ECONOMIC SECURITY. The purpose of
the Plan is to receive contributions on behalf of Participants and to assist
Participants in providing for their future economic security.
(B) QUALIFICATION AS PROFIT SHARING PLAN WITH A CASH OR DEFERRED
ARRANGEMENT. The Plan is intended to qualify as a profit sharing plan under
Section 401(a) of the Code, including a cash or deferred arrangement under
Section 401(k) of the Code.
(C) EXCLUSIVE BENEFIT OF PARTICIPANTS. The Plan and the Trust shall
be administered for the exclusive benefit of the Participants and their
Beneficiaries and shall not be used for or diverted to any other purposes.
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ARTICLE 2
DEFINITIONS
For the purposes of this Plan, unless the context requires otherwise,
the following words and phrases, when used herein with initial capital
letters, shall have the meanings indicated.
2.1 ACCOUNTS. With respect to any Participant, the aggregate of all of
the accounts established and maintained on his behalf under the Plan,
including his Salary Deferral Account, Rollover Contribution Account,
Employer Contribution Account, and Voluntary After Tax Contribution Account.
2.2 ACTUAL DEFERRAL PERCENTAGE. (ADP) For a specified group of
Participants for a Plan Year, the average of the ratios (calculated
separately for each Participant in such group) of (1) the amount of employer
contributions (including Employer Contributions pursuant to Section 4.4)
actually paid over to the trust on behalf of such Participant for the Plan
Year to (2) the Participant's Compensation for such Plan Year. Employer
contributions on behalf of any Participant shall include any elective
deferrals made pursuant to the Participant's deferral election, including
Excess Elective Deferrals. For purposes of computing Actual Deferral
Percentages, an Employee who would be a Participant but for the failure to
make elective deferrals shall be treated as a Participant on whose behalf no
elective deferrals are made.
2.3 ALTERNATE PAYEE. Any spouse, former spouse, child or other
dependent of a Participant who is recognized by a Qualified Domestic
Relations Order as having a right to receive all, or a portion of, the
benefits payable under the Plan with respect to such Participant.
2.4 ASSOCIATION. The Air Line Pilots Association, International.
2.5 AVERAGE ACTUAL DEFERRAL PERCENTAGE. The average (expressed as a
percentage) of the Actual Deferral Percentages of the Participants in a group.
2.6 BENEFICIARY. Any person designated by a Participant in accordance with
Article 9, to receive any sums payable hereunder if such Person survives the
Participant.
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2.7 CODE. The Internal Revenue Code of 1986, as amended, and all rules,
rulings, and regulations thereunder.
2.8 COMPENSATION. The total amount of compensation paid to a Participant
by the Employer during a Plan Year as reflected on the Form W-2 filed by the
Employer with respect to such Participant for the Plan Year plus any salary
reductions authorized by the Participant under this Plan or any other
qualified cash or deferred arrangement under Section 401(k) of the Code or
any cafeteria plan under Section 125 of the Code, which are not included in
compensation reportable on Form W-2; provided, however, that to the extent
required under Section 404 of the Code for the purposes of determining the
Employer's allowable deduction for contributions to the Plan, the term
"Compensation" shall not include Salary Deferrals or Section 125 reductions.
For Plan Years beginning before January 1, 1995, the Compensation of
each Participant taken into account for determining all benefits provided
under the Plan for any Plan Year shall not exceed $200,000 (hereinafter the
"$200,000 limitation"). For each such Plan Year, this limitation shall be
adjusted by the Secretary of the Treasury at the same time and in the same
manner as under Section 415(d) of the Code, except that the dollar increase
in effect on January 1 of any calendar year shall be effective for the Plan
Year beginning in such calendar year and the first adjustment to the $200,000
limitation shall be effective on January 1, 1990.
For Plan Years beginning on or after January 1, 1995, the annual
Compensation of each Participant taken into account for determining all
benefits provided under the Plan for any Plan Year shall not exceed $150,000,
as adjusted for increases in the cost-of-living in accordance with Section
401(a)(17)(B) of the Code. The cost-of-living adjustment in effect for a
calendar year shall apply to any determination period beginning in such
calendar year.
If Compensation for any prior determination period shall be taken
into account in determining a Participant's allocations for the current Plan
Year, the Compensation for that prior determination period shall be subject
to the applicable annual Compensation limit in effect for that prior
determination period. For this purpose, in determining allocations in Plan
Years beginning on or after September 1, 1990, the annual Compensation limit
in effect for determination periods
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beginning before that date shall be $200,000. In addition, in determining
allocations in Plan Years beginning on or after January 1, 1995, the annual
Compensation limit in effect for determination periods beginning before that
date shall be $150,000.
If a determination period contains fewer than 12 months, then the
annual Compensation limit shall be an amount equal to the otherwise
applicable annual Compensation limit multiplied by a fraction, the numerator
of which is the number of months in the short determination period and the
denominator of which is 12.
In determining the Compensation of a Participant for purposes of
this limitation the rules of Section 414(q)(6) of the Code shall apply,
except that in applying such rules, the term "family" shall include only the
spouse of the Participant and any lineal descendants of the Participant who
have not attained age 19 before the close of the year. If as a result of the
application of such rules the adjusted annual Compensation limitation is
exceeded, then the limitation shall be prorated among the affected
individuals in proportion to each such individual's Compensation as
determined under this Section 2.8 prior to the application of this limitation.
2.9 DEFERRED RETIREMENT DATE. The date a Participant actually retires
from active employment with the Employer if such date is beyond his Normal
Retirement Date.
2.10 DISABILITY RETIREMENT DATE. The date when the Employee first fails
to pass an FAA medical examination, that results in the loss of his license
to fly as an airline pilot, because of accidental bodily injury or any
sickness or disease, including natural deterioration.
2. 11 DOMESTIC RETIREMENT ORDER. Any judgment, decree, or order (including
approval of a property settlement agreement) which (i) relates to the
provisions of child support, alimony payments, or marital property rights to
a spouse, former spouse, child, or other dependent of a Participant, and (ii)
is made pursuant to state domestic relations law (including a community
property law).
2.12 EARLY RETIREMENT DATE. The first day of the calendar month in which
occurs a Participant's 55th birthday.
2.13 EMPLOYEE. Any Person employed by the Employer as a pilot and who is
on the Hawaiian Airlines, Inc. System Seniority List.
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2.14 EMPLOYER. Hawaiian Airlines, Inc. and any successor corporation.
2.15 EMPLOYER CONTRIBUTION ACCOUNT. The separate account maintained for
each Participant on the Plan's records reflecting his interest in assets
attributable to Employer Contributions made pursuant to Section 4.4, as
adjusted pursuant to Section 7.5.
2.16 EMPLOYER CONTRIBUTIONS. Contributions to the Plan by the Employer
pursuant to Section 4.4.
2.17 EMPLOYER STOCK. For periods prior to September 12, 1994, shares of
voting common stock issued by HAL, Inc. and for periods on and after
September 12, 1994, shares of voting common stock issued by the Employer,
which shares shall constitute "employer securities" as defined in Section 409(1)
of the Code. Employer Stock which is listed on the American Stock Exchange
and which is regularly traded thereon shall be valued by the Trustee at the
closing price thereon determined as of the end of the trading day on which such
value is to be used.
2.18 ERISA. The Employee Retirement Income Security Act of 1974, as
amended, and all rules, rulings, and regulations thereunder.
2.19 EXCESS CONTRIBUTIONS. With respect to any Plan Year the excess of
(i) the aggregate amount of contributions actually taken into account in
computing the Actual Deferral Percentage of Highly Compensated Employees for
such Plan Year over (ii) the maximum amount of such contributions permitted
by the Actual Deferral Percentage test (determined by reducing contributions
made on behalf of Highly Compensated Employees in order of the Actual
Deferral Percentages, beginning with the highest of such percentages).
2.20 EXCESS ELECTIVE DEFERRALS. The Salary Deferrals that are includible
in a Participant's gross income under Section 402(g) of the Code to the
extent such Participant's Salary Deferrals for a taxable year exceed the
dollar limitation under Section 402(g). Excess Elective Deferrals shall be
treated as Annual Additions under Section 8.4(A) of the Plan, unless such
amounts are distributed no later than the first April 15 following the close
of the Participant's taxable year.
2.21 FAMILY MEMBER. An individual described in Section 414(q)(6)(B) of
the Code.
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2.22 HIGHLY COMPENSATED EMPLOYEE. An individual described in
Section 414(q) of the Code.
2.23 HOUR OF SERVICE. The sum of --
(a) Each hour for which an employee is directly or indirectly
paid, or entitled to payment, by the Employer for the performance of
services, and each hour for which back pay, regardless of mitigation of
damages, is either awarded or agreed to by the Employer; provided, however,
that an employee shall be credited with only one Hour of Service even though
such employee may receive more than straight-time pay for such hour; and
(b) Each hour for which an employee is directly or indirectly
paid, or entitled to payment, by the Employer for reasons other than
performance of duties, including paid vacation hours and hours of sickness
or disability for which he is paid (other than solely for the purpose of
complying with applicable workman's compensation, unemployment compensation,
or disability laws or other than solely as reimbursement for medical
expenses), jury duty, layoff, military duty, or leave of absence up to a
maximum of 501 hours for any continuous period during which the employee is
paid although no duties were performed. When payments made for reasons
other than the performance of duties are calculated on units of time (such
as eight hours per day or 40 hours per week), such additional hours shall be
credited based on the number of regularly scheduled working hours included
in the units of time on which such payments are based. When such payments
are not calculated on units of time, such additional Hours of Service shall
be credited by dividing the amount of payment received or due for reasons
other than the performance of duties by the lesser of: (i) the employee's
most recent hourly rate of Compensation for the performance of duties, or
(ii) the employee's average rate of Compensation for the performance of
duties for the most recent Plan Year in which such employee completed more
than 500 Hours of Service. The determination of Hours of Service for
reasons other than the performance of duties, and the crediting of such
hours to periods of service, shall in all instances comply with the
provisions of Labor Department Regulations Sections 2530.200b-2(b) and (c).
An Hour of Service shall be determined from records maintained by the
Employer; provided, however, that in the case of an employee whose
Compensation is not determined on the basis of certain amounts for each hour
worked (such as salaried, commission, and piece-work employees) and whose
hours are
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not required to be counted and recorded by any federal law (such as the
Fair Labor Standards Act), such employee's Hours of Service, in the
discretion of the Employer, need not be determined from employment records
and such employee may be credited with 45 Hours of Service per each week,
or ten Hours of Service per each day, in which the Employee would be
credited with Hours of Service pursuant to this Section 2.23.
For participation and vesting purposes, an individual who is
absent from work for maternity or paternity reasons shall receive credit for
Hours of Service which would otherwise have been credited to such
individual but for such absence, or in any case in which such hours cannot
be determined, eight Hours of Service per day of such absence. For purposes
of this paragraph, an absence from work for maternity or paternity reasons
means an absence (1) by reason of the pregnancy of the individual, (2) by
reason of a birth of a child of the individual, (3) by reason of the
placement of a child with the individual in connection with the adoption of
such child by such individual, or (4) for purposes of caring for such child
for a period beginning immediately following such birth or placement. The
Hours of Service credited under this paragraph shall be credited for a
12-month period beginning in the Plan Year in which the absence begins.
An Hour of Service shall be credited for employment with other
members of an affiliated service group (as defined under Section 414(m) of
the Code; a controlled group of corporations (as defined under Section 414(b)
of the Code); or a group of trades or businesses under common control (as
defined under Section 414(c) of the Code) of the Employer, and any other
entity required to be aggregated with the Employer pursuant to Section 414(n)
or 414(o) of the Code and the regulations thereunder.
Hours of Service will also be credited for any individual
considered an Employee for purposes of this Plan under Section 414(n) or
Section 414(o) of the Code and the regulations thereunder.
For purposes of this definition, "employee" shall mean a person
employed in any capacity by the Employer, and shall not be restricted to
persons employed as pilots.
2.24 MARRIED PARTICIPANT. A Participant who has been married to his
spouse for at least one year on the date of the Participant's death.
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2.25 NORMAL RETIREMENT DATE. The first day of the calendar month in
which occurs a Participant's 60th birthday.
2.26 PARTICIPANT. Any Employee who becomes eligible to participate in
the Plan pursuant to Article 3. In addition, any Person who maintains a
balance in an Account under the Plan shall be considered a Participant for
such purpose.
2.27 PERSON. Any individual, partnership, corporation, trust, or other
entity.
2.28 PLAN. Hawaiian Airlines, Inc. Pilots' 401(k) Plan.
2.29 PLAN ADMINISTRATOR. The Employer, as provided in Section 18.1.
2.30 PLAN YEAR. The period from September 1, 1990 through December 31,
1990 and each subsequent 12-month period ending on December 31.
2.31 QUALIFIED DOMESTIC RELATIONS ORDER. A Domestic Relations Order
which creates or recognizes the existence of an Alternate Payee's right to
or assigns to an Alternate Payee the right to receive all, or a portion of,
the benefits payable with respect to a Participant under the Plan, and which
meets the following requirements, as determined in accordance with Article 16.
(a) A Domestic Relations Order shall be a Qualified Domestic
Relations Order only if it clearly specifies the following information:
(i) the name and last known mailing address of the
Participant and the name and the mailing address of each Alternate Payee
covered by the Domestic Relations Order; provided that, if the Domestic
Relations Order does not specify the current mailing address of the
Alternate Payee but the Plan Administrator shall have reason to know that
address independently, then the requirements of this subsection shall be
deemed satisfied;
(ii) the amount or percentage of the Participant's benefits
to be paid by the Plan to each such Alternate Payee, or the manner in which
such amount or percentage is to be determined;
(iii) the number of payments or period to which such Domestic
Relations Order applies; and
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(iv) that the order applies to the Plan.
(b) A Domestic Relations Order is not a Qualified Domestic
Relations Order if it:
(i) requires the Plan to provide any type or form of
benefit, or any portion, not otherwise provided under the Plan;
(ii) requires the Plan to provide benefits in excess of those
set forth in the Plan (determined on the basis of actuarial value); or
(iii) requires the payment of benefits to an Alternate Payee
which are required to be paid to another Alternate Payee under another
Domestic Relations Order previously determined to be a Qualified Domestic
Relations Order.
(c) In the case of any payment before a Participant has separated
from service, a Domestic Relations Order may be a Qualified Domestic
Relations Order even though it requires that payment of benefits be made to
an Alternate Payee:
(i) on or after the date on which the Participant attains
(or would have attained) the earliest retirement age under the Plan;
(ii) as if the Participant has retired on the date on which
such payment is to begin under such Domestic Relations Order (but taking
into account only the present value of the benefits actually accrued and not
taking into account the present value of any Employer subsidy for early
retirement); and
(iii) in any form in which such benefits may be paid under the
Plan to the Participant (other than in the form of a qualified joint and
survivor annuity with respect to the Alternate Payee and his or her
subsequent spouse).
2.32 RETIREMENT BOARD. The body established pursuant to Article 19.
2.33 ROLLOVER ACCOUNT. The separate account maintained for each
Participant on the Plan's records reflecting his interest in assets
attributable to any Rollover Contribution made by such Participant pursuant
to Section 4.3, as adjusted pursuant to Section 7.5.
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2.34 SALARY DEFERRAL. Such portion of a Participant's Compensation
which is contributed by the Employer to the Plan on behalf of such
Participant pursuant to a Salary Deferral agreement.
2.35 SALARY DEFERRAL ACCOUNT. The separate account maintained for each
Participant on the Plan's records reflecting his interest in assets
attributable to Employer contributions made pursuant to Section 4.1, as
adjusted pursuant to Section 7.5.
2.36 STATUTORY COMPENSATION. The aggregate of all of a Participant's
wages, salaries, and fees for professional services and other amounts
received (without regard to whether or not an amount is paid in cash) for
personal services actually rendered in the course of employment with the
Employer to the extent that the amounts are includible in gross income
(including, but not limited to, commissions paid salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips, bonuses, fringe benefits, and reimbursements or other
expense allowances under a nonaccountable plan described in Treas. Reg.
Section 1.62-2(c)), and excluding the following:
(1) Employer contributions to a plan of deferred
compensation that are not includible in the employee's gross income for the
taxable year in which contributed, Employer contributions under a simplified
employee pension plan to the extent such contributions are deductible by
the employee, or any distributions from a plan of deferred compensation;
(2) amounts realized (i) from the exercise of a
non-qualified stock option or (ii) when restricted stock (or property) held
by the employee either becomes freely transferable or is no longer subject
to a substantial risk of forfeiture;
(3) amounts realized from the sale, exchange, or other
disposition of stock acquired under a qualified stock option; and
(4) other amounts that received special tax benefits, or
contributions made by an Employer (whether or not under a deferral
agreement) towards the purchase of an annuity account described in
Section 403(b) of the Code (whether or not the contributions are actually
excludible from the gross income of the employee).
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For Limitation Years (as defined in Section 8.4(H) beginning after
December 31, 1991, Statutory Compensation for a Limitation Year shall be the
Compensation actually paid or made available during such year.
2.37 STOCK FUND. The investment fund which shall consist of Employer
Stock that the Employer contributed to the Plan pursuant to the Debt
Restructuring Letter of Agreement dated October 12, 1992, and the Letter of
Agreement dated September 21, 1990. The Stock Fund may also contain
Employer Stock purchased on the open market by the Trustee. The Stock Fund
shall be invested 100% in Employer Stock.
2.38 SYSTEM SENIORITY LIST. The Hawaiian Pilots' System Seniority List
for Pilots of Hawaiian Airlines, Inc.
2.39 TERMINATION OF EMPLOYMENT. A Participant's separation from
service with the Employer. In addition, an Employee who has been furloughed
by the Employer for at least one year may elect, for purposes of this Plan
only, to be treated as having incurred a Termination of Employment,
although he retains all recall rights and other rights as a furloughed pilot
under the collective bargaining agreement between the Employer and the
Association in effect at the time of his furlough.
2.40 TRUST. The legal entity resulting from this Plan and the Trust
Agreement executed incident hereto which provides for the Trust to receive,
hold and invest the contributions made by the Employer and/or Participant,
and to make disbursements to, or for the benefit of, Participants and their
Beneficiaries.
2.41 TRUST AGREEMENT. The agreement between the Employer and the
Trustee executed pursuant to Article 20.
2.42 TRUST FUND. The total of contributions to the Trust made by the
Employer and Participants pursuant to this Plan, increased by income, gains,
appreciation, and recoveries received, and decreased by losses, depreciation
and benefits paid. The Trust Fund includes all assets acquired by
investment and reinvestment which are held in the Trust Fund.
2.43 TRUSTEE. The person(s) appointed pursuant to Section 20.1, and any
duly appointed additional or successor Trustee(s) acting thereunder.
2.44 VALUATION DATE. The last business day of each calendar quarter;
but with respect to the distribution of
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an account, the business day preceding the date of distribution.
2.45 VOLUNTARY AFTER TAX CONTRIBUTION ACCOUNT. The separate account
maintained for each Participant to reflect his interest in assets
attributable to contributions voluntarily made by such Participant pursuant
to Section 4.2 as adjusted pursuant to Section 7.5.
2.46 YEAR OF SERVICE. Twelve months of service, where a month of
service is any calendar month in which the Employee is credited with at
least one Hour of Service. Nonconsecutive months of service shall be
aggregated. Years of Service shall be expressed in whole years and
fractional years with each month of service constituting 1/12th of one Year
of Service.
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ARTICLE 3
PARTICIPATION
3.1 REQUIREMENTS
(A) MINIMUM SERVICE REQUIREMENT.
(1) This Section 3.1(A)(1) shall apply through December 31,
1993. Each Employee shall commence participation on the first day of the
calendar quarter commencing after his completion of one Year of Service
with the Employer, commencing with his date of hire. Any person who
previously met the foregoing requirements of this Section 3.1(A)(1), and who
becomes reemployed as an Employee shall commence participation on the first
day of the calendar quarter following his date of reemployment. A
reemployed Employee who has not previously met such requirements shall be
treated as a new Employee.
(2) This Section 3.1(A)(2) shall apply after December 31,
1993. Each Employee shall commence participation on the first day of the
month commencing after his completion of one Year of Service with the
Employer, commencing with his date of hire. Any person who previously met
the foregoing requirements of this Section 3.1(A)(2), and who becomes
reemployed as an Employee shall commence participation on the first day of
the month following his date of reemployment. A reemployed Employee who has
not previously met such requirements shall be treated as a new Employee.
(B) DELAYED PARTICIPATION FOR CERTAIN EMPLOYEES.
(1) This Section 3.1(B)(l) shall apply through December 31,
1993. In the event a person who is employed by the Employer in a capacity
other than an Employee subsequently becomes an Employee, he shall commence
participation on the first day of the calendar quarter commencing after his
change in employment or if later commencing after his satisfaction of the
one Year of Service requirement in Section 3.1(A)(1).
(2) This Section 3.1(B)(2) shall apply after December 31,
1993. In the event a person who is employed by the Employer in a capacity
other than an Employee subsequently becomes an Employee, he shall commence
participation on the first day of the month commencing after his change in
employment or if later commencing after his satisfaction of the one Year of
Service requirement in Section 3.1(A)(2).
3.2 DETERMINATION OF ELIGIBILITY. The Plan Administrator shall
determine the eligibility of each Employee to participate in this Plan.
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ARTICLE 4
CONTRIBUTIONS
4.1 SALARY DEFERRAL CONTRIBUTIONS.
(A) ELECTION AND AMOUNT. Effective for Compensation paid on
December 5, 1990, a Participant may elect to reduce his Compensation by a
designated amount (in whole multiples of 1% of his Compensation with a
maximum of 15%) and to have such amount contributed on his behalf by the
Employer, in cash, once a month to his Salary Deferral Account for
compensation earned in the preceding month. Any change in a Participant's
Salary Deferral election shall be effective as of January 1, April 1, July 1,
or October 1, provided such change is received by the Plan Administrator
at least 30 days prior to such January 1, April 1, July 1, or October l. In
no event, however, may a Participant's Salary Deferral contribution for a
Plan Year exceed the amount specified in Section 4.1(F)(1).
(B) SALARY DEFERRAL AGREEMENT. The election described in
Section 4.1(A) shall be made by a written Salary Deferral agreement between the
Employer and the Employee, in such form and manner as approved by the Plan
Administrator.
(C) TIME FOR PAYMENT. Salary Deferral contributions shall be
transmitted by wire transfer to the Trust by the Employer as soon as
reasonably possible, but in no event later than 15 days from the date such
amounts would have been due and payable to the Participant in the absence
of a Salary Deferral agreement, in accordance with the Employer's usual
payroll procedures.
(D) SPECIAL RULE. Effective for Plan Years beginning after
December 31, 1992:
(1) The Average Actual Deferral Percentage for Participants
who are Highly Compensated Employees for the Plan Year shall not exceed the
Average Actual Deferral Percentage for Participants who are non-Highly
Compensated Employees for the Plan Year multiplied by 1.25; or
(2) The Average Actual Deferral Percentage for Participants
who are Highly Compensated Employees for the Plan Year shall not exceed the
Average Actual Deferral Percentage for Participants who are non-Highly
Compensated Employees for the Plan Year multiplied by 2.0, provided that
the Average Actual Deferral Percentage for
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Participants who are Highly Compensated Employees does not exceed the
Average Actual Deferral Percentage for Participants who are non-Highly
Compensated Employees by more than two percentage points.
(3) The Actual Deferral Percentage for any Participant who
is a Highly Compensated Employee for the Plan Year and who is eligible to
have elective deferrals (and qualified non-elective contributions or
qualified matching contributions, or both, if treated as elective deferrals
for purposes of the Actual Deferral Percentage test) allocated to his or her
accounts under two or more arrangements described in Section 401(k) of the
Code, that are maintained by the Employer, shall be determined as if such
elective deferrals (and, if applicable, such qualified non-elective
contributions or qualified matching contributions, or both) were made under
a single arrangement. If a Highly Compensated Employee participates in two
or more cash or deferred arrangements that have different Plan Years, all
cash or deferred arrangements ending with or within the same calendar year
shall be treated as a single arrangement. Notwithstanding the foregoing,
this Plan shall be treated as separate and mandatorily disaggregated to the
extent required by Tres. Section 1.401(k)-1(g)(11)(iii).
(a) For purposes of determining the Actual Deferral
Percentage of a Participant who is a 5% owner of one of the ten most highly
paid Highly Compensated Employees, the elective deferrals (and qualified
non-elective contributions or qualified matching contributions, or both, if
treated as elective deferrals for purposes of the Actual Deferral Percentage
test) and Compensation of such Participant shall include the elective
deferrals (and, if applicable, qualified non-elective contributions or
qualified matching contributions, or both) and Compensation for the Plan
Year of Family Members (as defined in Section 414(q)(6) of the Code).
Family Members, with respect to such Highly Compensated Employees, shall be
disregarded as separate Employees in determining the Actual Deferral
Percentage both for Participants who are non-Highly Compensated Employees
and for Participants who are Highly Compensated Employees.
(b) For purposes of determining the Actual Deferral
Percentage test, elective deferrals, qualified non-elective contributions
and qualified matching contributions must be made before the last day of
the 12-month period immediately following the Plan Year to which
contributions relate.
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(c) The Employer shall maintain records sufficient to
demonstrate satisfaction of the Actual Deferral Percentage test and the
amount of qualified non-elective contributions or qualified matching
contributions, or both, used in such test.
(d) The determination and treatment of the Actual
Deferral Percentage amounts of any Participant shall satisfy such
other requirements as may be prescribed by the Secretary of the Treasury.
(E) REFUND OF EXCESS CONTRIBUTIONS. If Excess Contributions are
made for Highly Compensated Employees for a Plan Year, the Plan
Administrator shall be permitted to reduce the Salary Deferral amount of
such Participants to an amount which is not more than the maximum allowable
rate. This reduction shall be made first by reducing the deferral rate of
those Highly Compensated Employees whose deferral rate is highest in 1%
increments to the extent necessary. Any Excess Contributions shall be
returned to the Employer; provided that these funds shall be paid to the
affected Participants as additional Compensation, net of any applicable tax
withholdings.
Such Excess Contributions shall be adjusted for any income or loss
up to the date of distribution. The income or loss allocable to such Excess
Contributions shall be the sum of:
(i) the income or loss allocable to the Participant's
Salary Deferral Account for the Plan Year for which the excess contributions
occurred multiplied by a fraction, the numerator of which is the
Participant's excess contributions for the year and the denominator of which
is the balance of the Participant's Salary Deferral Account as of the end of
the Plan Year without regard to any income or loss occurring during such
Plan Year; and
(ii) 10% of the amount determined under (i) above
multiplied by the number of whole calendar months between the end of such
taxable year and the date of distribution, counting the month of
distribution if distribution occurs after the 15th day of such month.
(F) SECTION 402(g) LIMITATIONS ON SALARY DEFERRAL CONTRIBUTIONS.
(1) No Participant shall be permitted to have Salary
Deferrals made under this Plan or any other
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qualified plan maintained by the Employer during any taxable year in excess
of the dollar limitation contained in Section 402(g) of the Code in effect
at the beginning of such taxable year.
(2) A Participant may assign to this Plan any Excess
Elective Deferrals made during a taxable year of the Participant by
notifying the Plan Administrator on or before March 1 of the applicable year
of the amount of the Excess Elective Deferrals to be assigned to the Plan.
A Participant shall be deemed to notify the Employer of any Excess Elective
Deferrals that arise by taking into account only those Salary Deferrals made
to this Plan and any other plans of the Employer.
(3) Notwithstanding any other provision of the Plan, Excess
Elective Deferrals, plus any income and minus any loss allocable thereto,
shall be distributed no later than April 15 of each year to the Participant
to whose account Excess Elective Deferrals were assigned for the preceding
year and who claims Excess Elective Deferrals for such taxable year.
(4) The Participant's claim must (i) be in writing, (ii) be
submitted to the Plan Administrator not later than March 1 of the applicable
year, (iii) specify the amount of the Participant's Excess Elective
Deferrals for the preceding calendar year, and (iv) he accompanied by the
Participant's written statement that if such amounts are not distributed,
such Excess Elective Deferrals (when added to amounts deferred under other
plans or arrangements described in Sections 401(k), 408(k), or 403(b) of the
Code) shall exceed the limit imposed on the Participant by Section 402(g) of
the Code for the year in which the deferral occurred.
(5) The Excess Elective Deferrals shall be adjusted for any
income or loss up to the date of distribution. The income or loss allocable
to Excess Elective Deferrals shall be the sum of:
(i) the income or loss allocable to the
Participant's Salary Deferral Account for the taxable year multiplied by a
fraction, the numerator of which is such Participant's Excess Elective
Deferrals for the year and the denominator of which is the balance of the
Participant's Salary Deferral Account without regard to any income or loss
occurring during such taxable year; and
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(ii) 10% of the amount determined under (i) above
multiplied by the number of whole calendar months between the end of the
Participant's taxable year and the date of distribution, counting the month
of distribution if distribution occurs after the 15th day of such month.
The amount of Excess Elective Deferrals that may be
distributed with respect to a Participant shall be reduced by any Excess
Contributions previously distributed or recharacterized with respect to such
Participant for the Plan Year beginning with or within such taxable year.
In no event may the amount distributed exceed the Participant's total Salary
Deferrals for such taxable year.
4.2 VOLUNTARY AFTER TAX CONTRIBUTIONS AND WITHDRAWALS. No Participant
is required to make any contributions to the Plan. However, each
Participant may make voluntary after tax contributions to the Plan in whole
multiples of 1% of his Compensation paid on or after December 5, 1990. Such
voluntary after tax contributions may not exceed 10% of such Participant's
Statutory Compensation for the Plan Year of the contribution; if such
Participant is a participant under any other defined contribution or defined
benefit plan of the Employer, the total voluntary after tax contributions
under all such plans shall not exceed 10% of such Participant's Statutory
Compensation for all Plan Years that he has been a Participant. Any such
voluntary after tax contributions by a Participant shall be credited to such
Participant's Voluntary After Tax Contribution Account and shall be immune
from forfeiture under any provision of this Plan.
4.3 ROLLOVER CONTRIBUTIONS. An Employee, whether or not he has met
the service requirement for active participation set forth in Section
3.1(A), may make a Rollover Contribution to the Plan. The Retirement Board
shall determine whether to accept such contribution. Any Rollover
Contribution shall be kept in a separate Rollover Account in such
Participant's name on the Plan's records and shall be immune from forfeiture
under any provision of this Plan.
4.4 CONTRIBUTIONS.
(A) AMOUNT. The Employer shall make contributions to the Trust
in Employer Stock, in such amounts as required pursuant to the Letter of
Agreement, dated September 21, 1990, and the Debt Restructuring
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Letter of Agreement, dated October 12, 1992, entered into by and between
the Employer and the Association. Such Employer Contributions shall be kept
in a separate Employer Contribution Account in each Participant's name on
the Plan's records and shall be immune from forfeiture under any provision
of this Plan. The Employer's obligation to contribute such Employer
Contributions shall continue to any successor of the Employer (through
merger, sale, or other means of transfer of ownership or control), unless
the Association gives written consent otherwise. Effective January 1, 1993,
amounts held in the Employer Contribution Account shall be initially
invested in the Stock Fund, and thereafter subject to Participant
directions pursuant to Article 7 of the Plan.
(B) TIMING OF CONTRIBUTION. Employer Contributions required
under the Letter of Agreement dated September 21, 1990 shall be made to the
Trust by the Employer as follows:
(1) 1/6th of the total Employer Contribution as determined
under the Letter of Agreement dated September 21, 1990, shall be contributed
on November 2, 1990;
(2) 3/6ths of the total Employer Contribution as determined
under the Letter of Agreement, dated September 21, 1990, shall be
contributed on January 2, 1991;
(3) If the Employer's actuary determines that the remainder
of the Employer Contributions as determined under the Letter of Agreement,
dated September 21, 1990, will not exceed the limitations of Sections 404
or 415 of the Code for the 1991 Plan Year, the remainder of such Employer
Contributions shall be contributed within 15 days of such determination. If
the Employer's actuary determines that the remainder of the Employer
Contributions exceeds the limitations of Sections 415 or 404, the remainder
of the Employer Contributions shall be contributed on January 2, 1992.
(C) TIMING OF CONTRIBUTION. Employer Contributions of an
aggregate of 425,000 shares of Employer Stock, as required under the Debt
Restructuring Letter of Agreement dated October 12, 1992, shall be made to
the Trust by the Employer as follows:
(1) for the 1992 Plan Year, the Employer shall contribute
the maximum permissible number of shares
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of Employer Stock that can be contributed for each Employee eligible for an
allocation thereof for the 1992 Plan Year pursuant to Sections 404 and 415
of the Code on February 28, 1993, or within ten days after the registration
statement regarding such shares become effective, whichever is later; and
(2) for the 1993 Plan Year and each subsequent Plan Year,
the Employer shall contribute (i) the estimated maximum permissible number
of shares of Employer Stock that can be contributed for each Employee
eligible for an allocation thereof for that Plan Year pursuant to Sections 404
and 415 of the Code on January 12 of that Plan Year, or within ten days after
the registration statement regarding such shares becomes effective, whichever
is later; and (ii) the maximum permissible number of shares that can be
contributed for each Employee eligible for an allocation thereof for the
previous Plan Year pursuant to Sections 404 and 415 of the Code no later than
February 28 of the next Plan Year.
(3) Each Plan Year, the Employer shall provide the
Association a copy of its calculation of the estimated maximum permissible
number of shares of Employer Stock that can be contributed and allocated to
each individual for such Plan Year within 30 days after such calculation is
made. Each Plan Year, the Employer shall also provide the Association a
copy of its final calculation of the maximum permissible number of shares of
Employer Stock that can be contributed for each Plan Year within 30 days
after such calculation is made.
(4) For purposes of this Section 4.4(C), the maximum amount
of Employer Stock that can be contributed by the Employer for each Plan Year
shall be determined on the assumption that the maximum amount that may be
allocated to or benefits accrued on behalf of an eligible Employee under
Section 415 of the Code at any time shall be made first from the
contribution of Employer Stock provided in this Section 4.4(C) and prior to
any other contribution, allocation, or accrual of benefits to this Plan or
any other plan qualified under Section 401(a) of the Code, other than Salary
Deferrals.
(D) SUSPENSE ACCOUNT. A separate account shall be maintained in
which the Employer Stock contributed to the Trust Fund by the Employer shall
be segregated and held until allocated to Participants' Employer
Contribution Accounts pursuant to Section 5.2(D) and 5.2(E).
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4.5 RETURN OF CONTRIBUTIONS. Notwithstanding any other provisions of
this Plan, any contributions made by the Employer or a Participant are
conditioned upon the initial qualification of this Plan under Section 401(a)
of the Code; any contributions made by Participants or pursuant to a Salary
Deferral agreement shall be returned to the Participants and any
contribution made by the Employer shall be returned to the Employer within
one year after the date on which the Secretary of the Treasury (or his
delegate) issues notice to the Employer that the Plan does not satisfy the
requirements of Section 401(a) of the Code. A Contribution may also be
returned within one year if the contribution was made by reason of a mistake
of fact. Any Employer Contribution which is returned to the Employer shall
be paid directly to the Participants as compensation.
4.6 INDIVIDUAL LIMITATIONS ON CONTRIBUTIONS. The total amount of
contributions under this Article for any Plan Year may not exceed the
limitations set forth in Article 8.
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ARTICLE 5
ALLOCATIONS TO PARTICIPANTS' ACCOUNT
5.1 SEPARATE ACCOUNTS. The Plan Administrator shall establish and
maintain on its books, as applicable, a Salary Deferral Account, a Voluntary
After Tax Contribution Account, a Rollover Account, and an Employer
Contribution Account in the name of each Participant.
5.2 ALLOCATION RULES.
(A) SALARY DEFERRAL CONTRIBUTIONS. The Plan Administrator shall
allocate Salary Deferral contributions among Participants' Salary Deferral
Accounts in accordance with the applicable Salary Deferral agreements and
concurrent with the Employer's deposit of such contributions in the Trust
pursuant to Section 4.1.
(B) VOLUNTARY AFTER TAX CONTRIBUTIONS. The Plan Administrator
shall allocate voluntary after tax contributions among the Participant's
Voluntary After Tax Contribution Accounts in accordance with the applicable
voluntary after tax contribution agreements and concurrent with the
Employer's deposit of such contributions in the Trust pursuant to Section 4.2.
(C) ROLLOVER CONTRIBUTIONS. The Plan Administrator shall
allocate Rollover Contributions among the Participant's Rollover
Contribution Account concurrent with the Employer's deposit of such
contributions in the Trust pursuant to Section 4.3.
(D) EMPLOYER CONTRIBUTIONS-1990 AGREEMENT. The Plan Administrator
shall allocate Employer Contributions required under the Letter of Agreement
dated September 21, 1990 as follows:
(1) As of the last day of each Plan Year, the Plan
Administrator shall allocate the Employer Contributions received by the
Trust Fund in such Plan Year. The allocation to each Participant's Employer
Contribution Account shall (subject to Section 5.2(D)(2)) be the number of
shares of Employer Stock (computed to three decimal places) together with an
amount equal to the cash and non-cash dividends thereon constituting the
Employer Contributions received by the Trust Fund in such Plan Year that
bears the same ratio to such Employer Contributions as the Participant's
Compensation (excluding the per diem pay) for the Plan Year multiplied by
10% bears to the Compensation (excluding the per diem pay) of all
Participants for the Plan Year multiplied by 10%.
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(2) For purposes of allocating the Employer Contributions
for each Plan Year, each Employee hired after September 21, 1990, shall
receive an allocation of the Employer Contribution for such year as though
such Employee were a Participant for the period of the Plan Year he was an
Employee even if such Employee is not a Participant at any time during the
Plan Year. The amount so allocated for such an Employee shall be held in a
special account in such Employee's name. If such Employee terminates
employment prior to becoming a Participant, such account shall be regarded
as an additional Employer Contribution in the Plan Year such Employee
terminates employment. If such an Employee becomes a participant, then
such account shall become an Employer Contribution Account in the name of
the Participant.
(3) Any cash dividends paid to the Trust Fund on Employer
Stock allocated to a Participant's Employer Contribution Account shall
remain in such Participant's Employer Contribution Account and invested in
Employer Stock. Any cash and non-cash dividends paid to the Trust Fund on
unallocated Employer Stock shall be allocated to a Participant's Employer
Contribution Account in the same proportion to the total number of shares
received as the number of shares in the Employer Contribution Account for
such Participant immediately before such date bears to the total number of
shares allocated to the Employer Contribution Accounts of all participants
immediately before such date.
(E) EMPLOYER CONTRIBUTIONS-1992 AGREEMENT. Subject to the
provisions of Section 4.4(C), the Plan Administrator shall allocate Employer
Contributions, as required under the Debt Restructuring Letter of Agreement
dated October 12, 1992, and any attachments thereunder, as follows:
(1) For purposes of allocating the Employer Contributions,
each Participant who is an Employee on September 20, 1992 and who receives
Compensation on or after September 20, 1992, shall be eligible to receive an
allocation, subject to the limitations under Sections 404 and 415 of the
Code. If a Participant terminates employment prior to allocation of
Employer Stock in the Participant's Employer Contribution Account, such
Participant's Employer Stock shall be regarded as an additional Employer
Contribution in the calendar quarter such Participant terminates employment.
(2) An estimated amount of Employer Contributions shall be
allocated to Employees who are probationary Employees on September 20, 1992,
as though such Employees were Participants. The amount so allocated
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<PAGE>
for such Employees shall be held in a special account. If such Employee
terminates employment prior to becoming a Participant, that Employee's
amount shall be regarded as an additional Employer Contribution in the
calendar quarter such Employee terminates employment and shall be allocated
to eligible Employees on a per capita basis. If such an Employee becomes a
Participant, then the Employee's amount shall be allocated to an Employer
Contribution Account in the name of the Participant.
(3) For purposes of allocating the Employer Contributions
under this Section 5.2(E), the maximum amount that may be allocated to or
benefits accrued on behalf of an eligible Employee under Section 415 of the
Code at any time shall be made first from the allocation of Employer Stock
provided in this Section 5.2(E) and prior to any other contribution,
allocation, or accrual of benefits to this Plan or any other plan qualified
under Section 401(a) of the Code other than Salary Deferrals.
(4) For the 1992 Plan Year, each eligible Employee's
Employer Contribution Account shall be allocated (within 30 days of the
Employer contribution of Employer Stock for the 1992 Plan Year as required
under Section 4.4(C)(1)) from the shares of Employer Stock then held in the
unallocated suspense account established under Section 4.4(D), the number of
shares, if any, determined as follows:
Step 1: 853 shares of Employer Stock (or such lesser
number of shares due to the limitations under Section 415 of the Code,
determined on a per capita basis that are allocable for such Plan Year).
Step 2: If any shares of Employer Stock in such
suspense account remain unallocated after Step 1, 39 shares of Employer
Stock (or such lesser number of shares due to the limitations under Section
415 of the Code, determined by dividing the aggregate number of unallocated
shares that remains available for allocation in such Plan Year by the
aggregate number of whole years of service of all eligible Employees for
such Plan Year) for each whole year of service as of September 20, 1992.
Step 3: If any shares of Employer Stock in such
suspense account remain unallocated after Steps 1 and 2, such remaining
shares shall be allocated to each eligible Employee's Employer Contribution
Account on a per capita basis.
(5) For each calendar quarter after the 1992 Plan Year, each
eligible Employee's Employer
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Contribution Account shall be allocated (within 30 days after such calendar
quarter) from the shares of Employer Stock then held in the unallocated
suspense account established under Section 4.4(D), the number of shares, if
any, determined as follows:
Step 1: To the extent an eligible Employee has not been
previously allocated an aggregate of 853 shares of Employer Stock, a number
of shares of Employer Stock equal to the difference (or such lesser number
of shares due to the limitations of Section 415 of the Code, determined on a
per capita basis that are allocable for such quarter) between 853 shares and
the number of shares previously allocated to such Employee under Step 1 of
Section 5.2(E)(4)(a) or this Step 1.
Step 2: If any shares of Employer Stock in such
suspense account remain unallocated after Step 1, a number of shares of
Employer Stock equal to the difference (or such lesser number of shares due
to the limitations of Section 415 of the Code, determined by dividing the
aggregate number of unallocated shares that remains available for allocation
in such Plan Year by the aggregate number of whole years of service of all
eligible Employees for such Plan Year that are allocable for such quarter)
between 39 shares of Employer Stock for each whole year of service as of
September 20, 1992 and the number of shares previously allocated to such
Employee under Step 2 of Section 5.2(E)(4)(a) or this Step 2.
Step 3: If any shares of Employer Stock in such
suspense account remain unallocated after Steps 1 and 2, such remaining
shares shall be allocated to each eligible Employee's Employer Contribution
Account on a per capita basis.
(6) The maximum number of shares of Employer Stock allocable
to each eligible Employee under Steps 1 and 2 of Section 5.2(E)(4) and (5)
is set forth in Schedule 1 attached hereto.
(7) Any cash dividends paid to the Trust Fund on Employer
Stock allocated to a Participant's Employer Contribution Account shall be
contributed to such Participant's Employer Contribution Account and invested
in Employer Stock. Any cash or non-cash dividends paid to the Trust Fund
on unallocated Employer Stock shall be allocated to a Participant's Employer
Contribution Account in the same proportion to the total number of shares
received as the number of shares in the Employer Contribution Account for
such Participant immediately
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<PAGE>
before such date bears to the total number of shares allocated to the
Employer Contribution Accounts of all Participants immediately before such
date.
(8) Any shares that can not be allocated to Participants'
Employer Contribution Accounts by the Final Contribution Date, due to the
limitations imposed by Sections 404 and 415 of the Code, shall be allocated
to remaining Participants per capita. For purposes of this Section 5.2(E)(8),
the Final Contribution Date shall mean the later of (i) February 28, 1997, or
(ii) the date the Employer makes the last contribution of Employer Stock to the
Trust pursuant to Section 4.4(C) of the Plan to Participants continuously
employed by the Employer.
(F) NOTICE OF ALLOCATION. The Plan Administrator shall notify
the Trustee and the Association in writing (or by other permanent record) of
its allocations made pursuant to this Section 5.2.
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ARTICLE 6
VESTING
6.1 VESTING OF SALARY DEFERRAL ACCOUNT. A Participant's interest
in his Salary Deferral Account, if applicable, shall be 100% nonforfeitable
at all times.
6.2 VESTING OF VOLUNTARY AFTER TAX CONTRIBUTION ACCOUNT. A
Participant's interest in his Voluntary After Tax Contribution Account, if
applicable, shall be 100% nonforfeitable at all times.
6.3 VESTING OF ROLLOVER CONTRIBUTION ACCOUNT. A Participant's
interest in his Rollover Contribution Account, if applicable, shall be 100%
nonforfeitable at all times.
6.4 VESTING OF EMPLOYER CONTRIBUTION ACCOUNT. A Participant's
interest in his Employer Contribution Account, if applicable, shall be 100%
nonforfeitable at all times.
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ARTICLE 7
INVESTMENT OF ACCOUNTS
7.1 PARTICIPANT-DIRECTED INVESTMENT. All contributions to the Trust
shall be invested by the Trustee as directed by the Participants pursuant to
this Article 7, or in accordance with Section 7.4.
7.2 INVESTMENT OPTIONS. Subject to the next paragraph, each Participant
shall select any combination of the following investment options with respect
to the funds in all of his Accounts (except his Employer Contribution
Account):
(A) An investment option as selected by the Retirement Board, from
time to time, which provides for a short term fixed rate of return;
(B) An investment option as selected by the Retirement Board,
from time to time, which is primarily invested in equities;
(C) An investment option as selected by the Retirement Board,
from time to time, which is primarily invested in high grade money market
instruments; and
(D) Any additional investment options as selected, from time to
time, by the Retirement Board.
Such elections shall be made in writing or, if acceptable to the
Trustee, by phone or electronic transmission, to the Trustee in accordance
with procedures established by the Plan Administrator. Each Participant
shall be solely responsible for the selection of his investment options
provided for hereunder. The fact that an investment option is made available
to a Participant for investment under the Plan shall not constitute, or be
construed as constituting, a recommendation for investment in that investment
option.
Effective January 1, 1993, a Participant may direct the Trustee to
liquidate any or all amounts held in his name in the Stock Fund, to the
extent permissible under law, and immediately thereafter reinvest in another
investment option available under this Article 7. The Trust Fund may hold up
to 100% of its assets in Employer Stock. A Participant may not, however,
direct the Trustee to liquidate any or all amounts held in his name in
another investment option and immediately thereafter reinvest in the Stock
Fund.
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7.3 FREQUENCY OF CHANGING INVESTMENT OPTIONS. Subject only to
restrictions imposed by the Trustee, a Participant shall be permitted to
change his election of any investment option(s) and/or the percentage of
funds (in increments of 10%) in each of his Accounts to be invested in each
investment option, with respect to prior contributions, future contributions,
other allocations, and all earnings thereon.
7.4 FAILURE TO SELECT INVESTMENT OPTION. Any funds in the Accounts of a
Participant with respect to which the Participant has failed to elect an
investment option shall be invested in the money market instrument option
selected by the Retirement Board pursuant to Section 7.2(C), until such time
as the Trustee is advised by the Participant of the investment option
election.
7.5 INVESTMENT INCOME AND LOSSES. The amount of net income, loss,
appreciation, or depreciation from each investment option shall be credited
to or charged against, as the case may be, each of the Accounts of each
Participant selecting such option on a pro rata basis no less frequently than
the last day of each month in the Plan Year or as the Trustee may dictate.
The Plan Administrator will provide each Participant with written information
concerning his investments' performance for each quarter within the first
month of the following quarter.
7.6 VOTING EMPLOYER STOCK. Any Participant shall be entitled to inform
the Trustee in writing of the direction in which he would vote the shares of
Employer Stock then allocated to such Participant's Employer Contribution
Account. The Trustee shall vote the block of shares allocated to
Participants' Employer Contribution Accounts according to the direction of
the majority of number of shares for which the Trustee received information,
subject, however to the Trustee's fiduciary obligation under ERISA. Shares
of Employer Stock held by the Trust which are not then allocated to
Participants' Employer Contribution Accounts shall be voted by the
fiduciaries designated in Section 18.6 as long as in accordance with the
applicable fiduciary obligations of ERISA.
On any question regarding the merger, consolidation, or acquisition
of the Employer, the acquisition by the Employer of another airline, the sale
of all or substantially all of the Employer's assets, or the liquidation of
the Employer, the Trustee shall vote the block of allocated and unallocated
shares of Employer Stock held by the Trust as specified above. In addition,
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prior to any sale of Employer Stock by the Trustee other than as described in
Section 14.2 (such as a "tender offer" for Employer Stock or a "takeover
attempt"), a majority of the shares of Employer Stock allocated to
Participant's Employer Contribution Accounts must be voted by such
Participants in favor of such sale.
At the direction of the Plan Administrator, the Trustee shall use its
best efforts to deliver, or cause to be delivered, to the Participants a copy
of all proxies, notices, and other information which the Employer generally
distributes to the shareholders of the Employer. The Trustee shall establish
such procedures for the collection of the instructions of the Participants on
the voting of Employer Stock as it shall determine to be appropriate.
7.7 CONVERSION OF EMPLOYER STOCK TO CASH. Employer Stock which becomes
subject to liquidation pursuant to the provisions of this Article 7 shall be
sold by the Trustee on the open market and the cash resulting therefrom
credited to the Participant as of the closing market value on the transaction
date.
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ARTICLE 8
LIMITATIONS ON CONTRIBUTIONS
8.1 LIMITATION ON ANNUAL ADDITIONS TO THE PLAN - NO PARTICIPATION IN
OTHER DEFINED CONTRIBUTION ARRANGEMENT.
(A) If a Participant does not participate in and has never
participated in another qualified plan maintained by the Employer, a welfare
benefit fund (as defined in Section 419(e) of the Code) maintained by the
Employer, or an individual medical account (as defined in Section 415(1)(2)
of the Code) maintained by the Employer, or a simplified employee pension (as
defined in Section 408(k) of the Code) maintained by the Employer that
provides an Annual Addition, the amount of Annual Additions that may be
credited to the Participant's Accounts for any limitation year shall not
exceed the lesser of the Maximum Permissible Amount or any other limitation
contained in the Plan. If a contribution that would otherwise be contributed
or allocated to the Participant's Accounts would cause the Annual Additions
for the Limitation Year to exceed the Maximum Permissible Amount, the amount
contributed or allocated shall be reduced so that the Annual Additions for
the Limitation Year equal the Maximum Permissible Amount.
(B) Prior to determining the Participant's Statutory Compensation
for the Limitation Year, the Employer may determine the Maximum Permissible
Amount for a Participant on the basis of a reasonable estimate of the
Participant's Statutory Compensation for the Limitation Year, such estimate
to be uniformly determined for all Participants similarly situated.
(C) As soon as is administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for the Limitation Year shall
be determined on the basis of the Participant's actual Statutory Compensation
for the Limitation Year.
(D) If pursuant to Section 8.1(C) there is an Excess Amount, any
Salary Deferrals, to the extent such contributions would reduce the Excess
Amount, shall be returned to the Participant.
8.2 LIMITATION ON ANNUAL ADDITIONS TO THE PLAN - PARTICIPATION IN ANOTHER
DEFINED CONTRIBUTION ARRANGEMENT.
(A) If in addition to this Plan the Participant is covered
under another qualified plan maintained by the Employer, a welfare benefit
fund (as defined in Section
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419(e) of the Code) maintained by the Employer, or an individual medical
account (as defined in Section 415(1)(2) of the Code) maintained by the
Employer, or a simplified employee pension (as defined in Section 408(k) of
the Code) maintained by the Employer that provides an Annual Addition during
any Limitation Year, then the Annual Additions that may be credited to a
Participant's Accounts under this Plan for any such Limitation Year shall not
exceed the Maximum Permissible Amount reduced by the Annual Additions
credited to a Participant's account under such other plans and funds for the
same Limitation Year. If the Annual Additions with respect to the
Participant under such other plans and funds are less than the Maximum
Permissible Amount and a contribution that would otherwise be contributed or
allocated to the Participant's Accounts under this Plan would cause the
Annual Additions for the Limitation Year to exceed the Maximum Permissible
Amount, the amount contributed or allocated shall be reduced so that the
Annual Additions under all such plans and funds for the Limitation Year shall
equal the Maximum Permissible Amount. If the Annual Additions with respect
to the Participant under such other plans and funds in the aggregate are
equal to or greater than the Maximum Permissible Amount, no amount shall be
contributed or allocated to the Participant's Accounts under this Plan for
the Limitation Year.
(B) Prior to determining the Participant's actual Statutory
Compensation for the Limitation Year, the Employer may determine the Maximum
Permissible Amount for a Participant in the manner described in Section 8.1(B).
(C) As soon as is administratively feasible after the end of the
Limitation Year, the Maximum Permissible Amount for the Limitation Year shall
be determined on the basis of the Participant's actual Statutory Compensation
for the Limitation Year.
(D) If, pursuant to Section 8.2(C) or as a result of the allocation
of forfeitures, if any, a Participant's Annual Additions under this Plan and
such other plans and funds would result in an Excess Amount for a Limitation
Year, the Excess Amount shall be deemed to consist of the Annual Additions
last allocated, except that Annual Additions attributable to a welfare
benefit fund or individual medical account shall be deemed to have been
allocated first regardless of the actual allocation date.
(E) If an Excess Amount was allocated to a Participant on an
allocation date of this Plan that
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coincides with an allocation date of another such plan or fund, the Excess
Amount attributed to this Plan shall be the product of (i) the total Excess
Amount allocated as of such date and (ii) the ratio of [a] the Annual
Additions allocated to the Participant for the Limitation Year as of such
date under this Plan to [b] the total Annual Additions allocated to the
Participant for the Limitation Year as of such date under this and all other
such plans and funds.
(F) Any Excess Amount attributed to this Plan shall be disposed in
the manner described in Section 8.1(D).
8.3 LIMITATION ON ANNUAL ADDITIONS TO THE PLAN - PARTICIPATION IN DEFINED
BENEFIT PLAN.
If the Employer maintains or at any time maintained a qualified
defined benefit plan covering any Participant in this Plan, the sum of the
Participant's Defined Benefit Fraction and Defined Contribution Fraction
shall not exceed 1.0 in any Limitation Year. Reduction of benefits and/or
contributions or allocations to the plans, where required, shall he
accomplished first by reducing the Participant's benefits under the defined
benefit plans and then by reducing the contributions or allocations under the
defined contribution plans. If the Participant participates in more than one
defined benefit plan maintained by the Employer and reductions are necessary
under the defined benefit plans, such reductions shall be made first from the
first such plan in which he commenced participation and if further reduction
is required, then from the second such plan in which he commenced
participation, and proceeding in such order until the limitation of this
Section 8.3 is no longer exceeded. If the Participant participates in more
than one defined contribution plan (other than the Plan) maintained by the
Employer, reductions in such category of plans shall be first from the first
such plan in which he commenced participation and if further reduction is
required, then from the second such plan in which he commenced participation,
and proceeding in such order until reductions from all such plans have been
appropriately effected.
8.4 DEFINITIONS
In addition to the definitions in Article 2, the following
definitions shall apply for purposes of this Article 8:
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(A) Annual Additions: The sum of the following amounts credited to
a Participant's Accounts for the Limitation Year:
(1) Employer contributions,
(2) employee contributions,
(3) forfeitures,
(4) amounts allocated to an individual medical account (as
defined in Section 415(1)(2) of the Code) that is part of a pension or
annuity plan maintained by the Employer,
(5) amounts derived from contributions paid or accrued in
taxable years that are attributable to post-retirement medical benefits
allocated to the separate account of a key employee (as defined in
Section 419A(d)(3) of the Code) under a welfare benefit fund (as defined in
Section 419(e) of the Code) maintained by the Employer,
(6) allocations under a simplified employee pension (as
defined in Section 408(k) of the Code), and
(7) any Excess Amount applied under Section 8.1(D) or 8.2(F)
in the Limitation Year to reduce employer contributions.
(B) Defined Benefit Fraction: A fraction, the numerator of which is
the sum of the Participant's Projected Annual Benefits under all the defined
benefit plans (whether or not terminated) maintained by the Employer, and the
denominator of which is the lesser of 125% of the dollar limitation
determined for the Limitation Year under Sections 415(b) and (d) of the Code
or 140% of the Highest Average Compensation, including any adjustments under
Section 415(b) of the Code.
Notwithstanding the prior paragraph, if the Participant was a
participant as of the first day of the first Limitation Year beginning after
December 31, 1986 in one or more defined benefit plans maintained by the
Employer that were in existence on May 6, 1986, the denominator of this
fraction shall not he less than 125% of the sum of the annual benefits under
such plans that the Participant had accrued as of the close of the last
Limitation Year beginning before January 1, 1987, disregarding any changes in
the terms and conditions of such plan after May 5, 1986. This paragraph
applies only
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if the defined benefit plans individually and in the aggregate satisfied the
requirements of Section 415 for all Limitation Years beginning before January 1,
1987.
(C) Defined Contribution Dollar Limitation: $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 Limitation Year.
(D) Defined Contribution Fraction: A fraction, the numerator of
which is the sum of the Annual Additions to the Participant's accounts under
all the defined contribution plans (whether or not terminated) maintained by
the Employer for the current and all prior Limitation Years (including the
Annual Additions attributable to the Participant's nondeductible employee
contributions to all defined benefit plans, whether or not terminated,
maintained by the Employer and the Annual Additions attributable to all
welfare benefit funds (as defined in Section 419(e) of the Code) and
individual medical accounts (as defined in Section 415(1)(2) of the Code)
maintained by the Employer), and the denominator of which is the sum of
the maximum aggregate amounts for the current and all prior Limitation
Years with the Employer (regardless of whether a defined contribution plan was
maintained by the Employer). The maximum aggregate amount in any Limitation
Year is the lesser of 125% of the dollar limitation determined under
Sections 415(b) and (d) of the Code in effect under Section 415(c)(1)(A) of the
Code or 35% of the Participant's Statutory Compensation for such year.
If the Participant was a participant as of the end of the first day
of the first Limitation Year beginning after December 31, 1986, in one or
more defined contribution plans maintained by the Employer that were in
existence on May 6, 1986, the numerator of this fraction shall be adjusted if
the sum of this fraction and the defined benefit fraction would otherwise
exceed 1.0 under the terms of this Plan. Under the adjustment, an amount
equal to the product of (i) the excess of the sum of the fractions over 1.0
times (ii) the denominator of this fraction, shall be permanently subtracted
from the numerator of this fraction. The adjustment shall be calculated
using the fractions as they would be computed as of the end of the last
Limitation Year beginning before January 1, 1987, and disregarding any
changes in the terms and conditions of the Plan made after May 6, 1986, but
using the Section 415 limitation applicable to the first Limitation Year
beginning on or after January 1, 1987.
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The Annual Addition for any Limitation Year beginning before
January 1, 1987, shall not be recomputed to treat all employee contributions as
Annual Additions.
(E) Employer: The Employer and all members of a controlled group
of corporations (as defined in Section 414(b) of the Code as modified by
Section 415(h) of the Code), all commonly controlled trades or businesses (as
defined in Section 414(c) of the Code as modified by Section 415(h) of the
Code), or all members of an affiliated service group (as defined in
Section 414(m) of the Code) of which the Employer is a part, and any other
entity required to be aggregated with the Employer pursuant to Section 414(o)
of the Code.
(F) Excess Amount: The excess of the Participant's Annual
Additions for the Limitation Year over the Maximum Permissible Amount.
(G) Highest Average Compensation: The average Statutory
Compensation for the three consecutive Years of Service with the Employer
that produces the highest average.
(H) Limitation Year: A calendar year. All qualified plans
maintained by the Employer must use the same Limitation Year. If the
Limitation Year is amended to a different 12-consecutive month period, the
new Limitation Year must begin on a date within the Limitation Year in which
the amendment is made.
(I) Maximum Permissible Amount: The lesser of $30,000 (or
beginning January 1, 1988, such larger amount determined in accordance with
Section 415(d) of the Code for the Limitation Year). The maximum Annual
Addition that may be contributed or allocated to a Participant's Accounts
under the Plan for any Limitation Year shall not exceed the lesser of (i) the
Defined Contribution Dollar Limitation or (ii) 25% of the Participant's
Statutory Compensation for the Limitation Year. The compensation limitation
referred to in clause (ii) of the prior sentence shall not apply to any
contribution for medical benefits (within the meaning of Section 401(h) or
419A(f)(2) of the Code) that is otherwise treated as an Annual Addition under
Section 415(l)(1) or 419A(d)(2) of the Code.
If a short Limitation Year is created because of an amendment
changing the Limitation Year to a different 12-consecutive month period, the
Maximum Permissible Amount shall not exceed the Defined
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Contribution Dollar Limitation multiplied by the following fraction:
number of months in the short limitation year
---------------------------------------------
12
(J) Projected Annual Benefit: The annual retirement benefit
(adjusted to an actuarially equivalent straight life annuity if such benefit
is expressed in a form other than a straight life annuity or qualified joint
and survivor annuity) to which the participant would be entitled under the
terms of the plan assuming:
(1) the participant shall continue employment until normal
retirement age under the plan (or current age, if later), and
(2) the participant's Statutory Compensation for the current
Limitation Year and all other relevant factors used to determine benefits
under the plan shall remain constant for all future Limitation Years.
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ARTICLE 9
BENEFICIARIES
9.1 DESIGNATION. Each Participant may designate one or more
Beneficiaries by delivering a written designation thereof to the Plan
Administrator. Upon the death of a Participant, his Beneficiary shall be
entitled to payments of benefits due the Participant in an amount and in the
manner provided for in this Plan. A Participant may designate different
Beneficiaries at any time by delivering a new written designation to the Plan
Administrator. Any such designation shall become effective only upon its
receipt by the Plan Administrator. The last effective designation received
by the Plan Administrator shall supersede all prior designations. A
designation of a Beneficiary shall be effective only if the designated
Beneficiary survives the Participant. In the case of a Married Participant,
the Beneficiary of the death benefit provided in this Article shall be the
Married Participant's spouse, provided, however, that a Married Participant
may designate a Beneficiary other than the spouse if:
(a) the spouse, in a writing witnessed by a notary, consents to the
Participant's right to designate another Beneficiary, or
(b) the Participant has no spouse, or
(c) the spouse cannot be located.
9.2 FAILURE TO DESIGNATE. If a Participant fails to designate a
Beneficiary, or if no designated Beneficiary survives the Participant, the
Participant shall be deemed to have designated as the Beneficiary, in order
of priority: (a) surviving spouse, (b) surviving children (including adopted
children), in equal shares, (c) surviving parents, in equal shares, or
(d) the Participant's estate.
9.3 BENEFICIARIES BOUND BY PLAN. Whenever the rights of a Participant are
stated or limited in the Plan and the Trust Agreement, his Beneficiaries
shall be bound thereby.
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ARTICLE 10
RETIREMENT BENEFITS
10.1 AMOUNT OF BENEFITS. The Plan Administrator shall direct the Trustee
to distribute to such Participant his Account, in the form and manner
required by Article 14.
10.2 TIME OF DISTRIBUTION
(A) Subject to Section 14.4, unless a Participant elects to defer
commencement of benefits pursuant to Section 10.2(B), the benefits under
Section 10.1 shall be distributed no later than 90 days after the end of the
calendar month within which the Plan Administrator receives written notice
that the Participant actually retires or terminates employment. Should a
retired Participant die before receiving all amounts due to him, any balance
shall be paid to his Beneficiary.
(B) Subject to Appendix 1, a Participant shall have the option to
defer distribution of his benefits until a date not later than April 1 of the
calendar year following the calendar year in which the Participant attains
age 70 1/2. Upon a Participant's written election to receive his benefits,
after his Normal Retirement Date but prior to April 1 of the year in which
the Participant attains age 70 1/2 such benefits shall be distributed no
later than 90 days after the end of the calendar month within which the
Participant actually makes such election.
(C) Anything contained herein to the contrary notwithstanding, a
Participant, whether retired or active, must commence receipt of his benefits
not later than April 1 of the calendar year following the calendar year in
which the Participant attains age 70 1/2.
10.3 DEFERRED RETIREMENT. Notwithstanding a Participant's Normal or Early
Retirement Date, he shall not be required to actually retire from the service
of the Employer and shall be entitled to continue to participate in the Plan
until his actual retirement.
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ARTICLE 11
DEATH BENEFITS
11.1 DEATH BENEFITS.
(A) AMOUNT OF BENEFITS. The Plan Administrator shall direct the
Trustee to distribute to such Participant's Beneficiary the Participant's
Account, in the form and manner required by Article 14.
(B) TIME OF DISTRIBUTION. Subject to Section 14.4, the benefits
under this Section 11.1 shall be distributed no later than 90 days after the
end of the calendar month within which the Plan Administrator receives
written notice of such Participant's death.
11.2 PROOFS. The Plan Administrator may require such proof of death and
such evidence of the right of any person to receive payment of the benefits
of the deceased Participant as it may deem advisable. The Plan
Administrator's determination of death and of the right of any person to
receive payment shall be conclusive.
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ARTICLE 12
DISABILITY BENEFITS
12.1 AMOUNT OF BENEFITS. The Plan Administrator shall direct the Trustee
to distribute to such Participant his Accounts in the form and manner
required by Article 14.
12.2 TIME OF DISTRIBUTION.
(A) Subject to Section 14.4, unless a Participant elects to defer
commencement of benefits pursuant to Section 12.2(B), below, the benefits
under Section 12.1 shall be distributed no later than 90 days after the end
of the calendar month within which the Participant actually retires or
terminates employment. Should a disabled Participant die before receiving all
amounts due to him, any balance shall be paid to his Beneficiary.
(B) Subject to Appendix 1, a Participant shall have the option to
defer distribution of his benefits until a date not later than April 1 of the
calendar year following the calendar year in which the Participant attains
age 70 1/2. Upon a Participant's written election to receive his benefits,
after his Normal Retirement Date but prior to April 1 of the year in which
the Participant attains age 70 1/2 such benefits shall be distributed no
later than 90 days after the end of the calendar month within which the
Participant actually makes such election.
(C) Anything contained herein to the contrary notwithstanding, a
Participant, whether retired or active, must commence receipt of his benefits
not later than April 1 of the calendar year following the calendar year in
which the Participant attains age 70 1/2.
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ARTICLE 13
EMPLOYMENT TERMINATION BENEFITS
13.1 PARTICIPATION CEASES UPON TERMINATION OF EMPLOYMENT. Upon
Termination of Employment, a Participant shall cease to be a Participant in
the Plan, except for purposes of receiving a distribution of his Accounts, as
hereinafter provided in this Article.
13.2 TIME OF DISTRIBUTION. Subject to Section 14.4, the benefits provided
for hereunder shall be distributed no later than 60 days after the quarter in
which a Participant incurs a Termination of Employment.
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ARTICLE 14
DISTRIBUTIONS TO PARTICIPANTS
14.1 TIME AND METHOD OF PAYMENT. The benefit to which a Participant or
Beneficiary may become entitled under Articles 10 through 13 (inclusive)
shall be distributed to him at such time as he elects in the form of a
single sum.
14.2 DISTRIBUTION IN CASH. Distributions shall be made in cash, except for
a Participant's Employer Contribution Account, which shall be distributed in
shares of Employer Stock, with the value of any fractional share distributed
in cash. The Trustee may sell fractional shares of Employer Stock allocated
to a Participant's Employer Contribution Account in order to obtain cash that
is to be distributed to a Participant or Beneficiary.
14.3 REPURCHASE OF EMPLOYER STOCK. To the extent that the Employer Stock
is no longer publicly traded on an established securities market at the time
that the Employer Contribution Account is distributed to any Participant or
Beneficiary, such Employer Stock shall be subject to the requirements of
Section 409(h) of the Code.
In such event, any Participant or Beneficiary receiving a distribution
of shares of Employer Stock from the Plan shall have the right to require the
Employer to purchase such shares of Employer Stock (the "put option") at any
time during the following two periods, at their fair market value determined
by the most recently completed valuation that coincides with or immediately
precedes the date the put option is exercised. The first period shall be for
60 days beginning on the date of distribution of Employer Stock to the
Participant or Beneficiary; and the second period shall be for 60 days
beginning on the date the Participant or Beneficiary receives notice of the
first valuation of Employer Stock which occurs after the date of distribution
of Employer Stock to the Participant or Beneficiary. The payment for shares
of Employer Stock sold to the Employer pursuant to the put option shall be
made in a lump sum in cash within 30 days after the put option is exercised.
14.4 SPECIAL DISTRIBUTION RULES.
(A) (1) If a Participant terminates service and the value of his
Accounts does not exceed (or at the time of any prior distribution did not
exceed) $3,500, the Participant shall receive a distribution of the value of
his Accounts. For purposes of this Section 14.4(A)(1), if the value a
Participant's Accounts is zero, the
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Participant shall be deemed to have received a distribution of his Accounts.
(2) If the value of a Participant's Accounts exceeds (or at the
time of any prior distribution exceeded) $3,500 and the Accounts are
immediately distributable, the Participant must consent to any distribution
of his Accounts. The consent of the Participant shall be obtained in writing
within the 90-day period ending on the first day of the first period for
which an amount is paid in any form. The Employer shall notify the
Participant of the right to defer any distribution until his Accounts are no
longer immediately distributable. Such notification shall be provided no
less than 30 days and no more than 90 days prior to the distribution date.
However, distribution may commence less than 30 days after the notice
described in the preceding sentence is given, provided the distribution is
one to which Sections 401(a)(11) and 417 of the Internal Revenue Code do not
apply, the Employer clearly informs the Participant that he has a right to a
period of at least 30 days after receiving the notice to consider the
decision of whether or not to elect a distribution (and, if applicable, a
particular distribution option), and the Participant after receiving the
notice affirmatively elects a distribution.
(3) Notwithstanding Section 14.4(A)(2), the consent of the
Participant shall not be required to the extent that a distribution is
required to satisfy Section 401(a)(9) or 415 of the Code.
(4) Accounts are immediately distributable if any part of the
Accounts could be distributed to the Participant (or surviving spouse) before
the Participant attains, or would have attained if deceased, the later of his
Normal Retirement Date or age 62.
(B) (1) Unless the Participant elects otherwise, distribution of
benefits shall begin no later than the 60th day after the latest of the close
of the Plan Year in which (i) the Participant attains age 65 (or his Normal
Retirement Date, if earlier), (ii) occurs the tenth anniversary of the year
in which the Participant commenced participation in the Plan, or (iii) the
Participant terminates service with the Employers. Notwithstanding the
foregoing, the failure of a Participant to consent to a distribution while
his Accounts are immediately distributable (within the meaning of
Section 14.4(A)(4)) shall he deemed to be an election to defer commencement of
payment of any benefit sufficient to satisfy this Section 14.4(B)(1).
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(2) A Participant may request that the payment to him of his
Accounts commence at a date later than the latest date provided under Section
14.4(B)(1). This request must be made by submitting to the Employer a written
statement, signed by the Participant, that describes the date on which the
Participant requests payment to commence. The Employer shall not grant this
request if such request would cause death benefits payable under the Plan
with respect to the Participant to be more than "incidental" within the
meaning of the applicable Treasury Regulations.
(C) The requirements of Appendix 1 shall apply to any distribution of
a Participant's Accounts and shall take precedence over any inconsistent
provisions of the Plan.
14.5 SECTION 401(a) (31) ELIGIBLE DISTRIBUTIONS.
(A) Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a distributee's election under this Section 14.5, a
distributee may elect, at the time and in the manner prescribed by the
Employer, to have any portion of an eligible rollover distribution that is
equal to at least $500 paid directly to an eligible retirement plan specified
by the distributee in a direct rollover.
(B) For purposes of this Section 14.5, the following definitions
shall apply:
(1) 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; 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); and any other distribution that is
reasonably expected to total less than $200 during a year.
(2) Eligible retirement plan: An eligible retirement plan is an
individual retirement account
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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.
(3) 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.
(4) Direct rollover: A direct rollover is a payment by the Plan
to the eligible retirement plan specified by the distributee.
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ARTICLE 15
INALIENABILITY OF BENEFITS
15.1 INALIENABILITY. A Participant's interest in the Plan, or that of his
Beneficiary, may not be assigned or alienated by voluntary or involuntary
assignment. Any attempt by a Participant or Beneficiary to assign or
alienate his interest under the Plan, or any attempt to subject his interest
to attachment, execution, garnishment or other legal or equitable process,
shall be void. This does not preclude the Trustee from complying with any
Qualified Domestic Relations Order, or from the use of the Plan assets as
security on a loan made pursuant to Article 22.
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ARTICLE 16
QUALIFIED DOMESTIC RELATIONS ORDERS
16.1 QUALIFIED DOMESTIC RELATIONS ORDERS. The Plan Administrator shall
comply with all Qualified Domestic Relations Orders received by it and shall
pay benefits in accordance with the applicable requirements of such Qualified
Domestic Relations Orders.
16.2 NOTICE AND DETERMINATION. The Plan Administrator shall promptly
notify the Participant and each Alternate Payee of the receipt of a Domestic
Relations Order and of the Plan's procedures (as described in Section 16.3)
for determining whether a Domestic Relations Order is a Qualified Domestic
Relations Order. The Plan Administrator shall, within a reasonable period of
time after receipt of a Domestic Relations Order, determine whether the
Domestic Relations Order is a Qualified Domestic Relations Order and notify
the Participant and each Alternate Payee of their determination. The notices
provided for in this Section 16.2 shall be mailed by certified mail, return
receipt requested, to the addresses specified in the Domestic Relations
Order, or, if the Domestic Relations Order fails to specify an address, to
the last address of the Participant or Alternate Payee known to the Plan
Administrator.
16.3 PROCEDURES FOR DETERMINATION. Upon the receipt of a Domestic
Relations Order, the Plan Administrator shall review such Domestic Relations
Order, or cause such Domestic Relations Order to be reviewed, to determine
whether it is a Qualified Domestic Relations Order. If the Domestic
Relations Order satisfies each and every requirement set forth in Section 2.31,
then the Plan Administrator shall make a determination that the Domestic
Relations Order is a Qualified Domestic Relations Order, and the Plan
Administrator shall provide notice of such determination in accordance with the
requirements set forth in Section 2.31. If the Domestic Relations Order does
not satisfy the requirements set forth in Section 2.31, the Plan Administrator
shall notify the Participant and any Alternate Payee of the reasons such
Domestic Relations Order would not be a Qualified Domestic Relations Order.
Each Alternate Payee shall be permitted to designate a representative for
receipt of copies of notices which are sent to the Alternate Payee with respect
to a Domestic Relations Order received by the Plan Administrator and pertaining
to the Alternate Payee.
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16.4 PROCEDURES FOR PERIOD DURING WHICH DETERMINATION IS BEING MADE.
(A) During any period in which the issue of whether a Domestic
Relations Order is a Qualified Domestic Relations Order is being determined
(by the Plan Administrator, the Retirement Board, a court of competent
jurisdiction, or otherwise), the Plan Administrator shall direct the Trustee
to segregate in a separate account(s) n the Plan the amounts which would have
been payable to the Alternate Payee during such period if the Domestic
Relations Order had been determined to be a Qualified Domestic Relations
Order.
(B) If within 18 months the Domestic Relations Order (or modification
thereof) is determined to be a Qualified Domestic Relations Order, the Plan
Administrator shall notify the Trustee to pay the segregated amounts (plus
any interest thereon) to the Alternate Payee entitled thereto.
(C) If within 18 months:
(1) it is determined that the Domestic Relations Order is not a
Qualified Domestic Relations Order, or
(2) the issue as to whether such Domestic Relations Order is a
Qualified Domestic Relations Order is not resolved, then the Plan
Administrator shall notify the Trustee to pay the segregated amounts (plus
any interest thereon) to the person or persons who would have been entitled
to such amounts if there had been no Domestic Relations Order.
(D) Any determination that a Domestic Relations Order is a Qualified
Domestic Relations Order which is made after the close of the 18-month period
shall be applied prospectively only.
16.5 TREATMENT OF FORMER SPOUSE AS A SURVIVING SPOUSE. To the extent provided
in any Qualified Domestic Relations Order, the former spouse of a Participant
shall be treated as a surviving spouse of such Participant.
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ARTICLE 17
CLAIMS PROCEDURE
17.1 CLAIMS AND DETERMINATION. Any claim for benefits under this Plan
shall be in writing to the Plan Administrator. If such claim for benefits is
wholly or partially denied, the Plan Administrator shall, within 90 days
after receipt of the claim notify the Participant or Beneficiary of the
denial of the claim. Such notice of denial shall (a) be in writing, (b) be
written in a manner calculated to be understood by the Participant or
Beneficiary, and (c) contain (i) the specific reason or reasons for denial of
the claim, (ii) a specific reference to the pertinent Plan provisions upon
which the denial is based, (iii) a description of any additional material or
information necessary to perfect the claim, along with an explanation of why
such material or information is necessary, and (iv) an explanation of the
claim review procedure under this Article 17.
17.2 REVIEW OF DENIAL OF CLAIMS. Within 60 days after the receipt by a
Participant or Beneficiary of a written notice of denial of the claim, or
such later time as shall be deemed reasonable taking into account the nature
of the benefit subject to the claim and any other attendant circumstances,
the Participant or Beneficiary may file a written request with the Retirement
Board that it conduct a full and fair review of the denial of the claim for
benefits and may examine pertinent documents and submit issues and comments
in writing to the Retirement Board for its review. The Retirement Board
shall deliver to the Participant or Beneficiary a written decision on the
claim within 60 days after receipt of the aforesaid request for review unless
special circumstances require an extension of time for processing, in which
case a decision shall be rendered by the Retirement Board as soon as
possible, but not later than 120 days after its receipt of a request for
review. Such decision shall (a) be written in a manner calculated to be
understood by the Participant and Beneficiary, (b) include the specific
reason or reasons for the decision, and (c) contain a specific reference to
the pertinent Plan provision upon which the decision is based.
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ARTICLE 18
PLAN ADMINISTRATION
18.1 PLAN ADMINISTRATOR. The Employer shall be the "Plan Administrator"
(as defined in Section 3(16)(A) of ERISA) of the Plan, and shall be
responsible for the performance of all reporting and disclosure obligations
under ERISA and all other obligations required or permitted to be performed
by the Plan Administrator under ERISA, including, but not limited to,
conducting the discrimination test required under ERISA. The Employer shall
be the designated agent for service of legal process. The Plan Administrator
shall have such duties for the management, operation, and administration of
the Plan as are specified herein.
18.2 ASSISTANTS OR REPRESENTATIVES. The Plan Administrator may appoint
such assistants or representatives as it deems necessary for the effective
exercise of its duties in administering the Plan. Further, the Plan
Administrator may delegate to such assistants and representatives any powers
and duties, both ministerial and discretionary, as it deems necessary or
appropriate. Further, the Plan Administrator may engage accountants,
attorneys, physicians, and such other personnel as it deems necessary or
appropriate.
18.3 LIABILITY. The Plan Administrator shall be free from all liability,
for his conduct and omissions, except to the extent of liability arising from
his own willful misconduct or from the breach of any responsibility,
obligation or duty imposed upon him by ERISA.
18.4 INDEMNIFICATION. To the extent not insured against by an insurance
company, the Employer shall indemnify and hold harmless the Plan
Administrator, the Employer Members of the Retirement Board and their
assistants and representatives, and the Association shall indemnify and hold
harmless the Association Members of the Retirement Board, from any and all
proceedings in connection with the Plan or the Trust that may be brought by
Employees, Participants, or their Beneficiaries or legal representatives, or
by any other Person; provided, however, that such indemnification shall not
apply to any such Person for such Person's acts of willful misconduct in
connection with the Plan.
18.5 COSTS AND EXPENSES. All costs, charges, and expenses incurred in
the administration of the Plan shall be paid in accordance with the pilots'
collective bargaining agreement.
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18.6 VOTING RIGHTS. The Association shall appoint fiduciaries to direct
the Trustee as to the manner in which shares of Employer Stock shall be voted
with respect to Employer Stock held by the Trust which are not allocated to
Participants' Employer Contribution Accounts.
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ARTICLE 19
RETIREMENT BOARD
19.1 RETIREMENT BOARD. There shall be established a Retirement Board for
the purpose of hearing and determining all disputes which may arise out of
the application, interpretation, or administration of the Plan or concerning
participation in or benefits under the Plan, with respect to the Participants
and their Beneficiaries covered thereby. The Retirement Board shall act
pursuant to the following:
(A) The Retirement Board shall consist of four members, two of whom
shall be selected by the Employer and two of whom shall be selected by the
Association. The Employer shall establish its own rules for the selection of
the members of the Retirement Board to be selected by it and the Association
shall likewise establish its own rules for the selection of the members of
the Retirement Board to be selected by it. The Employer shall also select
one alternate member who may act for either of the two members appointed by
the Employer in the event of absence or inability to act of one of such
members, and the Association shall likewise select one alternate member who
may act for either of the two members appointed by the Association in the
event of the absence or inability to act of one of such members. Either the
Employer or the Association at any time may remove a member appointed by it
and may select a member to fill any vacancy among the members selected by it.
Both the Employer and the Association shall, in writing, notify each other
respectively concerning such selections, which shall continue until further
written notice.
(B) Three members of the Retirement Board shall constitute a quorum
for the transaction of business. At all Retirement Board meetings, Employer
members present shall be entitled to one vote each and Association members
shall be entitled to one vote each. If at any such meeting two Employer
members are not present, the Employer member present may cast two votes, and
if two Association members are not present the Association member present may
cast two votes.
(C) The Retirement Board shall have the authority to appoint
subcommittees from among the members of the Retirement Board to handle any
problem within the jurisdiction of the Retirement Board. Such subcommittees
shall report conclusively to the Retirement Board.
(D) The compensation, travel, and other reasonable living expenses,
if any, of members of the
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Retirement Board selected by the Employer which are incidental to the holding
of such meetings and performing functions of the Retirement Board, shall be
paid by the Employer. The compensation, travel, and other reasonable living
expenses, if any, of members of the Retirement Board selected by the
Association which are incidental to the holding of such meetings and
performing functions of the Retirement Board, shall be paid by the
Association.
(E) All decisions and actions taken by the Retirement Board shall
be by the affirmative vote or agreement of not less than three votes. Such
affirmative vote or agreement shall be in writing if given other than during
a meeting of the Retirement Board. All decisions of the Retirement Board
shall be final and binding upon the Employer, the Association, and any other
Person having an interest in, under, or derived from the Plan. No ruling or
decision of the Retirement Board in one case shall create a basis for a
retroactive adjustment in any prior case.
(F) If the Retirement Board shall fail to agree on any matter or
dispute coming before it, it shall within ten days from the date of such
failure to agree, designate an Impartial Referee. If the Retirement Board
does not agree upon the selection of an Impartial Referee within such ten day
period, then either the Employer or the Association may apply to the National
Mediation Board for the designation by such Mediation Board of an Impartial
Referee. The matter or dispute shall be submitted to the Retirement Board
sitting with the Impartial Referee who shall act as Chairman during the
proceedings pertaining to such matter. Such Impartial Referee shall have one
vote. Three affirmative votes shall he required to render a decision or
determination on matters coming before the Retirement Board sitting together
with the Impartial Referee.
(G) The compensation and expenses of the Impartial Referee and
expenses incident to the conduct of proceedings coming before the Retirement
Board shall be shared equally between the Employer and the Association.
(H) Meetings of the Retirement Board may be called by mutual
agreement of the members at any time without notice or by any two members of
the Retirement Board upon 30 days' notice to the other members of the
Retirement Board. Such meetings shall be conducted at the Employer's offices
unless otherwise agreed to by the members of the Retirement Board.
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19.2 POWERS OF THE RETIREMENT BOARD. The Retirement Board shall
determine all disputes which may arise out of the application,
interpretation, or administration of the Plan or concerning participation in
or benefits under the Plan, with respect to the Participants and their
Beneficiaries covered thereby. The Retirement Board shall have full power to
affirm, reverse, or otherwise modify any decision or administrative action or
proposed action which gave rise to any dispute. The Retirement Board shall
have no power to add to or subtract from or modify any of the terms of the
Plan. The Retirement Board shall have the power to establish rules of
procedure for the conduct of its business and of hearings before it, which
rules shall not be inconsistent with the provisions of this Plan. In
addition, the Retirement Board shall perform the following functions: to
select, monitor, and replace the Trustee and investment advisors; to
establish the investment options among which the Participants may choose to
self direct their investments; and to retain, on a project-by-project basis,
investment and benefit consultants for individual investment options, which
payment for such consultant's fees from the Plan assets investment in such
investment option or, where appropriate, by directed brokerage commissions,
as determined by the Retirement Board and as may be permitted under ERISA.
19.3 REVIEW FUNCTIONS. The Retirement Board shall have the following
rights and review functions:
(A) To examine, during normal business hours, all books, records,
reports, regulations, and procedures relative to the Plan, including funding
instruments, amendments, annual reports, actuarial, trustees' and insurance
companies reports for the Plan, Trust Fund accounting, and related data.
(B) The Employer shall furnish to the Pilot members of the
Retirement Board and the Association all records and material set forth in
subsection (a) above within 30 days from the date on which such material may
have been prepared or compiled; and in any case annual reports (Form 5500),
trustees' and insuring companies reports for the Plan shall be furnished to
the Pilot members of the Retirement Board and the Association not less
frequently than once each year. The Pilot members of the Retirement Board
may request and shall be entitled to receive additional material and data
relating to the foregoing.
(C) The Retirement Board shall review the status and administration
of the Plan, the Trust Fund, and
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insurance contracts, and in the appropriate case make recommendations to the
Employer, the Association, and the Trustees. The Retirement Board shall
prepare periodic reports with respect to its functions and actions and supply
the same to the Employer and the Association.
19.4 EMPLOYER RECORDS. The Employer shall keep or cause to be kept such
records as may be necessary or appropriate in the discharge of its duties
hereunder. The records and reports maintained or received by the Employer in
connection with the administration of the Plan shall be available for
inspection at all reasonable times by the Retirement Board or the Association
and such consultants as they may employ.
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ARTICLE 20
TRUST FUND
20.1 TRUST AGREEMENT. The Employer shall at the discretion of the
Retirement Board enter into one or more Trust Agreements with one or more
Trustees to implement the provisions of this Plan. The Trust Agreements
shall be deemed a part of this Plan and any and all rights or benefits which
may accrue to any person under this Plan shall be subject to the terms and
provisions of said Trust Agreements. Likewise, all provisions of this Plan
shall be deemed part of the Trust Agreements. In case of any inconsistency
between the provisions of the Plan and the Trust Agreements, the provisions
of this Plan shall control.
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ARTICLE 21
TERMINATION AND AMENDMENT
21.1 PLAN TERMINATION. The Employer and the Association contemplate that
the Plan and the Trust shall be permanent. Nevertheless, in recognition of
the fact that future conditions and circumstances cannot now be entirely
foreseen, the Board of Directors of the Employer and the Association reserve
the right to terminate either or both the Plan and the Trust by joint
agreement.
21.2 DISCONTINUANCE OF CONTRIBUTIONS. Whenever the Employer and the
Association determine that it is impossible or inadvisable to make further
contributions as provided in the Plan, they may jointly agree, without
terminating the Trust, to permanently or temporarily discontinue all further
contributions under the Plan. The Plan Administrator and the Trustee shall
thereafter continue to administer all the provisions of the Plan which are
necessary to remain in force, other than the provisions relating to
contributions.
21.3 VESTING UPON TERMINATION AND DISCONTINUANCE. Upon the termination
or partial termination of the Plan or the complete discontinuance of
contributions by the Employer, the rights of each Participant to the amount
credited to his Accounts at such date shall be entirely nonforfeitable
without reference to any formal action on the part of the Employer, the Plan
Administrator, or the Trustee.
21.4 MERGER, CONSOLIDATION, OR SALE. In the event of a merger,
consolidation, or sale of assets of the Employer, under circumstances in
which a successor shall continue and carry on all or a substantial part of
the business of such Employer, and such successor shall employ a substantial
number of Employees of such Employer, then such successor shall carry on the
provisions of this Plan and such successor shall be substituted for the
Employer under the terms and provisions of this Plan.
21.5 VESTED RIGHTS NOT REDUCED ON MERGER, CONSOLIDATION, OR SALE. Neither
the Plan nor the Trust may be merged or consolidated with, nor may its assets
or liabilities be transferred to, any other plan or trust, unless (a) by
joint agreement of the Employer and the Association, and (b) each
Participant 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).
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21.6 AMENDMENT. The Board of Directors of the Employer and the
Association may amend the Plan and the Trust at any time, and from time to
time, by joint agreement. No such amendment, however, shall have the effect
of reducing any then nonforfeitable benefits of any Participant. If the
vesting schedule under Article 6 shall be amended and such amendment would,
at any time, decrease the percentage of nonforfeitable benefits which any
Participant would have been entitled to receive had the vesting schedule not
been so amended, then each Participant who is employed on the date such
amendment is adopted, or the date such amendment is effective, whichever is
later, and who has a nonforfeitable right to amounts in his Accounts pursuant
to Article 6 as of the end of the period within which such Participant may
make the election provided for herein, shall be permitted, beginning on the
date such amendment is adopted, to irrevocably elect to have his
nonforfeitable interest computed without regard to such amendment. Written
notice of such amendment and the availability of such election must be given
to each such Participant, and each such Participant shall be granted a period
of 60 days after the later of (a) his receipt of such notice, or (b) the
effective date of such amendment within which to make such election. Such
election shall be exercised by the Participant by delivering or sending
written notice thereof to the Plan Administrator prior to the expiration of
such 60 day period.
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ARTICLE 22
LOANS
22.1 AMOUNTS. Each Participant (or Beneficiary) may borrow an amount not
to exceed the lesser of: (i) $50,000 reduced by the greater (if any) of (a)
the highest outstanding balance of loans to the Participant from the Plan
during the one-year period ending on the day before the date on which the
loan is to be made, or (b) the outstanding balance of any loan to the
Participant from the Plan on the date on which such loan is to be made or
(ii) one-half of the Participant's vested interest in his Accounts
(determined as of the last day of the preceding calendar month). No loan may
be for an amount less than $1,000 and no Participant may have more than one
loan outstanding at any time. The amount the Participant may borrow shall be
reduced by the amount of any loan from any other tax-qualified plan
maintained by the Employer. For purposes of this Article 22, no portion of a
Participant's Employer Contribution Account shall be taken into account.
22.2 LOAN TERMS. An election for a loan shall be made in writing to the
Plan Administrator. The terms and conditions of such loans shall be
determined by the Plan Administrator in accordance with the following
guidelines:
(A) An annual rate of interest shall be equal to the interest rates
charged by persons in the business of lending money for loans which would be
made under similar circumstances.
(B) A fixed maturity date shall be of no longer than five years,
unless the loan is used to purchase the Participant's primary residence in
which case the maturity date of the loan shall be reasonable.
(C) Adequate security shall be the borrower's interest in his
Accounts, although the Plan Administrator may require additional security.
(D) Repayment of the loan principal and interest shall be on a
level schedule, but not less frequently than quarterly.
(E) The Participant shall pay all the application and periodic
administrative costs of the loan charged by the Trustee. Payment of
principal shall reduce the outstanding balance of the loans all payment of
principal and interest shall be credited to the Participant's Accounts and
shall be invested as directed by the Participant pursuant to Article 7.
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(F) The Participant shall direct the Trustee which investment
option shall be liquidated to provide loan funds.
(G) Loans shall be subject to spousal consent.
(H) Participant payment shall be made by payroll deduction.
(I) There shall be no prepayment penalty.
(J) Loan applications shall be reviewed once each month on a date
selected by the Plan Administrator. Approved loans shall be disbursed on the
first business day of the following month.
22.3 REDUCTION IN BENEFITS FOR NON-PAYMENT. Any Participant who has not
repaid the full amount of any loan, plus interest, at the time he retires,
dies, terminates employment shall have the unpaid balance deducted from
benefits otherwise payable to him or his Beneficiary under this Plan.
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ARTICLE 23
HARDSHIP WITHDRAWALS
23.1 HARDSHIP WITHDRAWALS. Distribution of Elective Deferrals may be
made on account of financial hardship if the distribution is necessary in
light of the immediate and heavy financial needs of the Participant. Such a
distribution shall not exceed the amount required to meet the immediate
financial need created by the hardship and may not be made to the extent that
other financial resources of the Participant are reasonably available.
(A) A distribution will be deemed to be made on account of the
immediate and heavy financial needs of the Participant if and only if the
distribution is used for the following expenses:
(1) medical expenses, and defined in Section 213(d) of the
Code, of the Participant, the spouse of dependents of the Participant;
(2) purchase of a principal residence for the Participant,
excluding mortgage payments;
(3) provide mortgage payments needed to prevent the eviction
of the Participant from, or foreclosure on the mortgage for, the principal
residence for the Participant;
(4) tuition for the next 12 months of post-secondary education
for the Participant, the Participant's spouse, children, or dependents.
(B) All determinations regarding financial hardship shall be made in
accordance with written procedures that are established by the Plan
Administrator and applied in a uniform and nondiscriminatory manner. Such
written procedures shall specify the requirements for requesting and
receiving distributions on account of hardship, including what forms must be
submitted and to whom. All determinations regarding financial hardship shall
comply with the applicable regulations under the Code.
(C) No portion of a Participant's Employer Contribution Account
shall be distributable under this Article 23.
23.2 TIME OF DISTRIBUTION. The benefits under Section 21.1 shall be
distributed no later than 60 days after the end of the calendar month within
which the Plan Administrator approves the Participant's request to receive
such benefits.
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ARTICLE 24
MISCELLANEOUS
24.1 PLAN NOT AN EMPLOYMENT CONTRACT. Nothing herein contained shall be
deemed (a) to give to any Employee the right to be retained in the employ of
the Employer, (b) to affect the right of the Employer to discipline or
discharge any Employee at any time, (c) to give the Employer the right to
require any Employee to remain in its employ, or (d) to affect the Employee's
right to terminate his employment at any time.
24.2 GOVERNING LAW. To the extent not preempted by federal law the Plan
and the Trust shall be construed, regulated, interpreted, and administered
under and in accordance with the laws of the State of Hawaii.
24.3 RULE AGAINST PERPETUITIES. If the laws of the State of Hawaii (or
those of any other jurisdiction whose laws apply to this Plan) restrict the
duration of the Plan, or provide that interests may be completely vested
within a designated period, this Plan shall not last longer than the period
permitted by such law.
24.4 USE OF WORDS. Wherever appropriate, words used in this Plan and
this Trust Agreement in the singular may mean the plural, and vice-versa, and
the masculine may mean the feminine, and vice-versa.
24.5 INDEPENDENT PROVISIONS. If any provision of this Plan shall be held
invalid or illegal for any reason, the remaining provisions shall be
construed and enforced as if the invalid or illegal provisions had never been
included.
24.6 TITLE. Titles to Articles and Sections are for convenience of
reference only and shall not affect the construction of this Plan.
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IN WITNESS WHEREOF, the Employer and the Association, by the
signatures of their duly authorized representatives below, hereby adopt and
agree to be bound by the provisions of the Hawaiian Airlines, Inc. Pilots'
401(K) Plan effective as of September 1, 1990.
FOR THE AIR LINE PILOTS IN FOR HAWAIIAN AIRLINES, INC.
THE SERVICE OF
HAWAIIAN AIRLINES, INC.
By /s/ J. R. Babbitt 12/30/94 By /s/ Bruce R. Nobles 12/23/94
-------------------------------- ------------------------------------
Its President Its Chairman, President and CEO
Air Line Pilots Association, Int'l
/s/ Reno F. Morella 12/30/94 /s/ Rae A. Capps 12/23/94
-------------------------------- ------------------------------------
Its HAL MEC Chairman Its Vice President, General
Counsel and Corporate Secretary
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APPENDIX 1
DISTRIBUTION REQUIREMENTS
SECTION 1. GENERAL RULES.
(A) The requirements of this Appendix 1 shall apply to any
distribution of a Participant's Accounts and shall take precedence over any
inconsistent provisions of the Plan, provided that this Appendix shall not be
construed to create a form of distribution that is not available under the
Plan.
(B) All distributions required under this Appendix 1 shall be
determined and made in accordance with the proposed regulations under
Section 401(a)(9) of the Code, including the minimum distribution incidental
benefit requirement of Prop. Treas. Reg. Section 1,401(a)(9)-2.
SECTION 2. REQUIRED BEGINNING DATE.
The entire interest of a Participant must be distributed or begin to
be distributed no later than the Participant's Required Beginning Date.
SECTION 3. LIMITS ON DISTRIBUTION PERIODS.
Except for withdrawals pursuant to Article 23, distributions of a
Participant's Accounts shall only be made in a single-sum.
SECTION 4. DEATH DISTRIBUTION PROVISIONS.
(A) DISTRIBUTION BEGINNING BEFORE DEATH. If the Participant dies
after distribution of his Accounts has begun, the remaining portion of such
Accounts must be distributed in a single sum to his Beneficiary.
(B) DISTRIBUTION BEGINNING AFTER DEATH. If the Participant dies
before distribution of his Accounts begins, a single sum distribution of the
Participant's Accounts shall at the surviving spouse's election be
distributed in accordance with Section 11.1(B) or at any subsequent date if
distribution is completed by December 31 of the calendar year containing the
fifth anniversary of the Participant's death; provided that if the designated
beneficiary is the Participant's surviving spouse, the date distribution is
required to be completed in accordance with this Section 4(B) shall not be
earlier than the later of (i) December 31 of the calendar year immediately
following the calendar year in which the
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Participant died or (ii) December 31 of the calendar year in which the
Participant would have attained age 70-1/2.
If the Participant has not made an election pursuant to this
Section 4(B) by the time of his death, the Participant's designated
beneficiary must elect the method of distribution no later than the earlier
of (i) December 31 of the calendar year in which distribution would be
required to begin under this Section 4 or (ii) December 31 of the calendar
year that contains the fifth anniversary of the date of death of the
Participant. If the Participant has no designated beneficiary or if the
designated beneficiary does not elect a method of distribution, distribution
of the Participant's entire Accounts must be completed by December 31 of the
calendar year containing the fifth anniversary of the Participant's death.
(C) For purposes of Section 4(B) of this Appendix 1, if the
surviving spouse dies after the Participant but before payments to such
spouse begin, the provisions of Section 4(B) (with the exception of the
proviso therein) shall be applied as if the surviving spouse were the
Participant.
(D) For purposes of this Section 4, any amount paid to a child of
the Participant shall be treated as if it had been paid to the surviving
spouse if the amount becomes payable to the surviving spouse when the child
reaches the age of majority.
(E) For purposes of this Section 4, distribution of a
Participant's Accounts are considered to begin on the Participant's Required
Beginning Date, or if Section 4(C) of this Appendix 1 is applicable, the date
distribution is required to begin to the surviving spouse pursuant to
Section 4(B) of this Appendix 1.
SECTION 5. DEFINITIONS.
In addition to the definitions in Article I, the following definitions
shall apply for purposes of this Appendix 1:
(A) Designated beneficiary: The individual who is designated as the
beneficiary under the Plan in accordance with Section 401(a)(9) of the Code
and the regulations thereunder.
(B) Distribution calendar year: A calendar year for which a
distribution is required. For distributions
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beginning before the Participant's death, the first distribution calendar
year is the calendar year immediately preceding the calendar year that
contains the Participant's Required Beginning Date. For distributions
beginning after the Participant's death, the first distribution calendar year
is the calendar year in which distributions are required to begin pursuant to
Section 5 of this Appendix 1.
(C) Accounts:
(1) The Accounts as of the last valuation date in the
calendar year immediately preceding the distribution calendar year (valuation
calendar year) increased by the amount of any contributions allocated to the
Accounts as of dates in the valuation calendar year after the valuation date
and decreased by distributions made in the valuation calendar year after the
valuation date.
(2) For purposes of the prior paragraph, if any portion of
the minimum distribution for the first distribution calendar year is made in
the second distribution calendar year on or before the Required Beginning
Date, the distribution made in the second distribution calendar year shall be
treated as if it had been made in the immediately preceding distribution
calendar year.
(D) Required Beginning Date: The first day of April of the
calendar year following the calendar year in which the Participant attains
age 70-1/2.
(E) A Participant shall be treated as a 5% owner for purposes of
this Appendix 1 if such Participant is a 5% owner as defined in Section 416(i)
of the Code (determined in accordance with Section 416 but without
regard to whether the Plan is top-heavy) at any time during the Plan Year
ending with or within the calendar year in which such owner attains age 66-1/2
or any subsequent Plan Year.
SECTION 6. PROPOSED REGULATIONS
If final regulations adopted by the Internal Revenue Service are
identical to the proposed regulations referred in this Appendix 1, then this
Appendix 1 shall be regarded as referring to such final regulations. However,
the Employer and the Association reserve the right to make any amendment to this
Appendix 1 that it deems necessary or appropriate in order to comply with final
regulations that may differ from the proposed regulations referred to in this
Appendix 1.
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AMENDMENT 1 TO
HAWAIIAN AIRLINES, INC.
PILOTS' 401(K) PLAN
In accordance with Section 21.6 of the Hawaiian Airlines, Inc. Pilots'
401(k) Plan (hereinafter the "Plan"), the Plan is hereby amended as set forth
herein:
1. Section 2.17 of the Plan is hereby amended to read in its entirety
as follows:
2.17 EMPLOYER STOCK. For periods prior to September 12, 1994, shares of
voting common stock issued by HAL, INC. and for periods on and after
September 12, 1994, shares of Class A Common Stock issued by the
Employer, which shares shall constitute "employer securities" as defined
in Section 409(l) of the Code. Employer Stock which is listed on the
American Stock Exchange and which is regularly traded thereon shall be
valued by the Trustee at the closing price thereon determined as of the end
of the trading day on which such value is to be used.
2. Section 2.37 of the Plan is hereby amended to read in its entirety as
follows:
2.37 STOCK FUND. The investment fund which shall consist of Employer
Stock that the Employer contributed to the Plan pursuant to the Third
Amended Consolidated Plan of Reorganization for HAL, Inc., Hawaiian
Airlines, Inc. and West Maui Airport, Inc. dated August 29, 1994, as
amended. The Stock Fund may also contain Employer Stock purchased on the
open market by the Trustee. The Stock Fund shall be invested 100% in
Employer Stock.
3. Section 4.4 of the Plan is hereby amended by adding a new
paragraph (X) at the end thereof to read in its entirety as follows:
(X) The Employer shall contribute Employer Stock to the Plan in
such amounts as are listed in Appendix 2 for each Participant whose
allocation listed thereon is eligible for contribution to the Plan.
Such contributions shall be allocated to the Participant's Employer
Contribution Account and shall be made at such times as shall be
determined pursuant to Section 5.2(G).
<PAGE>
4. Section 5.2 of the Plan is hereby amended by adding a new
paragraph (G) at the end thereof to read in its entirety as follows:
(G) The Employer shall contribute to the Plan and the Plan
Administrator shall credit to the Employer Contribution Account of each
Participant listed on Appendix 2 whose allocation thereon (the
"Contingent Allocation") is eligible for contribution to the Plan
("eligible Participant") the amounts determined as follows:
(1) For the 1994 Plan Year, the Employer shall
contribute to the Plan and the Plan Administrator shall credit to each
eligible Participant's Employer Contribution Account the portion of the
Participant's Contingent Allocation that will not exceed the limitations
of Sections 404 and 415 of the Code, and
(2) If for the 1994 Plan Year an eligible Participant's
Employer Contribution Account could not be credited with the full amount
of his Contingent Allocation, then for the 1995 Plan Year and each
subsequent Plan Year the Employer shall contribute to the Plan and the
Plan Administrator shall credit for such Plan Year the remaining amount
of the Participant's Contingent Allocation that will not exceed the
limitations of Sections 401(a)(17), 404, and Section 415 of the Code for
such year.
(3) Amounts which otherwise would have been contributed or
allocated to a Participant but cannot be contributed due to the
limitations of Sections 401(a)(17), 404, or 415 of the Code, shall be
contributed to the nonqualified arrangement pursuant to the collective
bargaining agreement. Amounts contributed to the non-qualified
arrangement for a Participant shall be contributed to this Plan for the
first subsequent Plan Year in which such contribution is permissible
under Sections 401(a)(17), 404, and 415 of the Code.
(4) For purposes of this section 5.2(G), the maximum amount of
the Contingent Allocation that can be credited to a Participant's
Employer Contribution Account for each Plan Year shall be determined on
the assumption that the maximum amount that may be credited to, or that
benefits may be accrued on behalf of, an eligible Participant under
Section
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<PAGE>
415 of the Code at any time shall be made first from Salary Deferral
under this Plan, then from the Contingent Allocation, and then from any
other contribution, allocation, or accrual of benefits to this Plan or
any other plan qualified under Section 401(a) of the Code.
(5) If a Participant's Contingent Allocation cannot be
contributed to the Plan and credited to an eligible Participant's
Employer Contribution Account for any Plan Year pursuant to this
Section 5.2(G) due to any limitation or requirement of the Code or the
Plan, such Contingent Allocation shall be contributed to the Plan at the
earlier of:
(i) the date such eligible Participant's Employer
Contribution Account may be credited therewith without violating any
limitation or requirement of the Code or the Plan, in which case such
contribution shall be credited to the eligible Participant's Employer
Contribution Account, or
(ii) December 1, 1999, at which time the amount of
such Contingent Allocation shall be contributed to the Plan and
credited pro rata among the Employer Contribution Accounts of the
then present Participants in the Plan who are receiving Compensation
from the Employer.
5. The Plan is hereby amended by adding an Appendix 2 at the end thereof
to read in its entirety as set forth in Appendix 2 attached hereto.
The amendments set forth herein shall be effective as of December 31,
1994.
To record the adoption of this amendment, Hawaiian Airlines, Inc. has
executed this document this 22nd day of June, 1995.
HAWAIIAN AIRLINES, INC. FOR THE AIR LINE PILOTS IN
THE SERVICE OF HAWAIIAN
HAWAIIAN AIRLINES. INC.
By /s/ C.K. Lyman By /s/ Reno F. Morella
--------------------------- ----------------------------
Its Vice President Finance MEC CHAIRMAN
By /s/ Rae A. Capps By /s/ J. R. Babbitt
--------------------------- ----------------------------
Its Vice President Counsel/
Secretary
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<PAGE>
DISTRIBUTION TO ALPA 401k PLAN
ITEM NAME NBR 401k PLAN
---- ----------------------- ---- ----------
1 ADAMS, PEDER-JON 3132 2,291.4816
2 AKIYAMA, DAVID K. 3871 1,273.3754
3 ALEXANDER, DAVID G. 4057 1,960.4961
4 ANDERSON, MARK A. 2948 2,484.7061
5 ANDERSON, PETER L. 4144 2,133.7647
6 APPLETON, TYLER C. 6740 606.9538
7 AVALLONE, ANDREW J. 0720 4,623.6728
8 AVERY, GEOFFREY S. 0759 3,848.2616
9 BALDWIN, RICHARD L. 6606 648.1343
10 BALL, GERALD H. 2661 2,512.3154
11 BANNING, SCOTT L. 0997 4,870.8170
12 BANZHOF, MARK A. 2034 3,343.2536
13 BARNES, MAUREEN L. 0752 2,644.2451
14 BARNETT, MATTHEW R. 3147 2,336.2635
15 BARRETT, JOHN K. 2231 3,045.7074
16 BELCHER, REGINALD L. 3383 1,071.9844
17 BELL, SAFFERY M. 0134 4,272.5235
18 BENCHETRIT, JACQUES 3389 1,324.6606
19 BERNATAS, NANC-ELISHA 6602 637.1343
20 BISCHOFF, RICHARD H. 0895 5,105.5766
21 BLANKENSHIP, WAYNE K. 0100 3,141.9745
23 BOWMAN, JAMES J. 3391 2,318.9148
24 BRADLEY JR., GORDON L. 3588 1,308.9614
25 BRESSLER, STEVEN C. 4350 1,789.2745
26 BRONSON, BARRY E. 3336 2,044.5152
27 BROWN, DOUGLAS W. 2033 3,343.0508
28 BUCKNER, LESLIE D. 6917 585.9218
29 BURGESS II, S. HUGH 2670 1,473.7342
30 BUTTS, MICHAEL D. 4266 1,800.7345
31 CAREY, EMMET J. 0145 2,367.0865
32 CHAMBERLAIN, MICHAEL 0832 3,381.4411
33 CHAPPUIS, ALAIN C. 4263 1,213.4916
35 CHELLIN, JEREMY E. 2302 2,665.7651
36 CHENG, JAMIESON P.C. 4135 2,133.1531
37 CHEW, DENNIS S.W. 4020 2,273.0668
38 CHILD III, WALTER D. 0636 3,049.9185
39 CHING, KEVIN K.H. 4145 2,134.1925
40 CHOCK, STEVEN Y.H. 2228 3,045.1216
41 CHUNG, DARRELL Y.H. 2672 2,921.9848
42 CLARK, BRUCE B. 0734 4,620.0403
43 CLARK, EDWARD P. 0801 3,842.6799
44 CLAWSON, BRUCE E. 3323 2,074.4438
45 CLEMENTS, BRUCE E. 2569 2,934.1375
46 CLEMENTS, JAMILE H. 6465 688.2222
47 CLUTE, GREGORY N. 4021 1,946.0754
48 COBB-ADAMS, PATRICK K. 1915 2,323.4584
49 COBURN, RICHARD S. 0922 4,502.6296
50 COMPTON, MICHAEL B. 6913 585.9218
51 CONNELLY, KEVIN D. 0867 3,052.5093
52 COPE, ERIC E. 3144 2,454.8157
53 CORSINI, ERIC P. 4563 1,185.1053
54 COTTLE, DENNIS J. 4443 1,226.4099
55 CRAIG, ARTHUR L. 0805 3,901.7991
56 CROCKETT, JAMES D. 4150 2,200.2411
57 DAISEY, KEVIN W. 3335 2,325.8338
58 DART, DAVID E. 4277 1,936.3656
59 DAU, MICHAEL G. 4022 2,221.0675
60 DAVIS JR., JAMES H. 0887 3,534.8880
61 DAWSON, MARK R. 2674 2,217.4239
62 DE REGO, JOHN B. 5192 1,092.3694
63 DEREGO, WILLIAM L. 0404 2,318.7386
1
<PAGE>
DISTRIBUTION TO ALPA 401k PLAN
ITEM NAME NBR 401k PLAN
---- ----------------------- ---- ----------
64 DEVITT, WILLIAM B. 6739 606.9538
65 DEY, SHARYN E. 592 2,235.2036
66 DIXON, ALAN B. 3395 2,325.7101
67 DOBBINS, TIMOTHY J. 2072 3,653.4103
68 DRAKE, MARK E. 4569 1,236.7710
69 DUDLEY, MICHAEL J. 1886 3,889.9907
70 DUNN JR., SAMUEL C. 1116 2,318.2096
71 DUNN JR., MELVIN A. 2223 3,045.1360
72 DYBALL, MERLIN W. 6604 648.1343
73 DYER, DOUGLAS W. 5193 1,064.8349
74 EARL, JAMES A. 0838 3,852.9481
75 EARLE, JOHN L. 0102 4,623.3620
76 EMERY, KENDALL L. 2229 3,044.9609
77 EMMINGER, RICHARD R. 5116 1,097.9887
78 ERMAN, LAIRD E. 6742 606.9538
79 EVELAND, CHACY R. 2268 2,399.4493
80 FINAZZO, MARIA R. 3319 2,321.6839
81 FLORES, CLIFFORD N. 1865 1,928.8047
82 FORD, JAMES D. 3148 2,113.7010
83 FOWLER, ALBERT J. 4568 1,184.5759
84 FOWLER, ERIC C. 3393 2,304.8114
85 FOWLER, JR., PETER R. 2307 2,219.6331
86 FRICKE, JAMES W. 4024 2,024.7268
87 FRISKEL, PATRICK J. 2032 3,696.3647
88 FUJII, HAROLD H. 4058 2,209.8156
89 FUJISE, LESLI F. 3133 2,371.9098
90 FULTON II, WILLIAM D. 2675 2,921.5027
91 GABRELCIK, WILLIAM J. 2676 2,879.0837
92 GARDETT, CHRISTOPHER W. 6909 585.9218
93 GARDNER, JAMES D. 0827 4,984.0630
94 GAUDINO, STEVEN M. 3327 2,237.7026
95 GERMANN, RALPH R. 0926 4,498.1343
96 GESSLER, RICHARD F. 0934 5,243.6433
97 GIDDINGS, JAMES A. 3145 2,370.7113
98 GIDDINGS, MICHAEL C. 2951 1,418.4529
99 GILL, PAUL C. 3720 1,960.0212
100 GODBE JR., RALPH H. 0917 4,499.3420
101 GOODWIN, THOMAS W. 3589 2,049.8374
102 GORE, DONALD A. 4567 1,212.2463
103 GORE, KENLEY B. 3590 1,308.5592
104 GRANT, BRUCE G. 0846 3,461.9837
105 GRIFFITH, TIMOTHY 0104 4,742.0366
106 GUDDAT, STEWART A. 6748 606.9538
107 HACKMAN, DONALD E. 6601 648.1343
108 HADA, THOMAS T. 3936 706.3840
109 HALDEMAN, STEPHEN D. 5194 1,078.8349
110 HAMMER, ROGER W. 2226 2,685.6879
111 HANIS, MARK A. 4561 1,212.4537
112 HANNIGAN, LEO T. 6468 707.8994
113 HANSEN III, WILLIAM P. 4331 1,759.9213
114 HARDIN, KEVIN K. 2303 2,657.6526
115 HARDING, NEIL W. 2667 2,912.5056
116 HARRELL, DONALD J. 0931 3,931.3886
117 HAYES, WILLIAM C. 5117 1,097.8473
118 HEINDL, KENNETH D. 0614 3,049.7811
119 HENDERSON, COWBOY D. 6920 585.9218
120 HENDERSON, THOMAS E. 6744 606.9538
121 HENEGHAN, KATHLEEN M. 3333 2,066.9195
122 HERNANDEZ, ROBERT 3380 2,318.6231
123 HEYE, CHARLES O. 4450 1,194.9039
124 HICKS JR., HAROLD S. 0405 2,318.7357
125 HILLIARD, MICHAEL A. 6916 585.9218
126 HODGES JR., WILLIAM R. 5118 1,117.3918
2
<PAGE>
DISTRIBUTION TO ALPA 401k PLAN
ITEM NAME NBR 401k PLAN
---- ----------------------- ---- ----------
127 HOELSCHER, JVANNE L. 4349 1,814.7513
128 HOLST, JAMES E. 6734 606.9538
129 HOLZGROVE, WILLIAM J. 0844 3,051.6932
130 HOOPAI, RONALD C.K. 3386 2,089.5110
131 HOWELL, JACK R. 4301 1,940.0378
132 HUBBS, DANIEL K. 3591 2,301.5990
133 HUDDLESTON, JAMES T. 4343 1,790.4805
134 HUDGINS, MICHAEL J. 4271 1,213.0598
135 HUITT JR., JOHN D. 4556 1,214.1962
136 HURD, RICHARD D. 0112 4,690.0808
137 HURST, MICHELE DEE 2305 1,557.9953
138 IKEDA, LAYNE M. 6605 648.1343
139 IMAI, SCOTT W. 3328 2,323.6855
140 JACKSON, JOHN G.H. 4289 1,936.3084
141 JARRELL, GREGORY S. 0817 3,052.7087
142 JOHNSON, GARRO K. 2952 2,400.3658
143 JONES, DAWSON F. 4346 1,790.2218
144 JONES, JAMES L. 0353 3,682.3268
145 JONES, JEFFREY T. 4560 1,214.6334
146 JONES, KATHY M. 6469 707.4454
147 JONES, SYDNEY EDWARD 6736 606.9538
148 JUSTMAN, ROBERT A. 4342 1,790.4630
149 KADLEC, DONALD J. 4338 1,896.8315
150 KAHAUOLOPUA, CRAIG K. 3320 2,323.6173
151 KAMEMOTO, KEITH Y. 2554 648.1343
152 KATAHARA, GERALD 0715 4,622.0515
153 KATANO, TRACY T. 3191 706.4117
154 KEELER JR., ROBERT V. 4445 2,142.2439
155 KELLY JR., GEORGE E. 2953 2,398.7697
156 KING, DUFF H. 4453 1,222.9298
157 KISSINGER, GARY J. 4138 2,133.3063
158 KITCHELL, WARREN D. 2301 3,029.9752
159 KNUTSON, DONALD T. 0949 4,560.2193
160 KOBAYASHI, CRAIG A. 0678 3,733.6519
161 KOCH, KEITH J. 3139 2,118.0130
162 KONOP, ROBERT C. 2539 2,565.8279
163 KOUCHAKJI, MITCHELL A. 4448 1,194.8139
164 KROGBIN, WAYNE H. 3861 2,001.4084
165 KUZMA, MARIAN J. 3149 2,449.9826
166 LAMBERT, JAMES V. 3593 2,303.7305
167 LAWRENCE, ROLLAND F. 0950 5,352.6241
168 LAZEAR III, ROBERT W. 4275 2,093.1698
169 LEAHEY, ROBERT A. 4139 1,914.4630
170 LEE, JONATHAN G.H. 2889 708.1375
171 LEE, JOSEPH B. 4566 1,212.7825
172 LEE, ROBERT S. 3134 1,987.3217
173 LILLEY, JEFFREY S. 5195 1,091.2757
174 LINDSEY, MELVIN J. 0874 4,984.8144
175 LINN, ROBERT D. 3135 2,372.3703
176 LOCKRIDGE, JAMES E. 0118 4,744.1736
177 LOGAN, RODGER R. 2666 2,915.7243
178 LOPEZ, JOHNNY 4341 1,924.7874
181 LOZOWSKI, BRADLEY W. 6921 585.9218
182 LUCAS, NICK C. 0903 2,902.4461
184 LWIN, DESMOND T. 2230 2,687.7591
185 LYON, PAUL E. 2298 1,571.8026
186 MAAS, MICHAEL B. 3137 2,372.8616
187 MACDONALD, JAMES G. 0406 3,772.7488
188 MACDONALD, WILLIAM A. 3334 2,322.5469
189 MACHADO, HOWARD M. 0935 5,491.2677
3
<PAGE>
DISTRIBUTION TO ALPA 401k PLAN
ITEM NAME NBR 401k PLAN
---- ----------------------- ---- ----------
190 MADSEN, KIRK L. 6472 708.0920
191 MAGUIRE, CHARLES T. 3136 2,453.8467
192 MALIN, STEVEN P. 0761 3,849.8735
193 MALLORY, CHARLES W. 6600 648.1343
194 MALTHANER, JEAN A. JR., 2631 707.6551
195 MARTIN, CHESTER A. 3866 1,274.1064
196 MARTIN, DAVID M. 4264 1,960.1145
197 MARTINEZ, JAMES E. 3388 1,324.3196
198 MASUDA, JAN M. 3325 2,323.6314
199 MCBRIDE, KIRK W. 4025 2,223.2455
201 MCCABE, PATRICK S. 2677 1,456.9460
202 MCCARTHY, J. PATRICK 4340 1,204.4183
203 MCCLAIN, ANTHOHY L. 3143
204 MCCOWN, DANIEL R. 6908 585.9218
206 MCLEAN, ALEXANDER R. 6474 707.4420
207 MCLEAN, JAMES G. 0352 3,682.6951
208 MCWILLIAMS, ROBERT R. 4447 1,780.9047
209 MEDEIROS, LEON A. 3863 2,253.4773
210 MENDIOLA, FRANCISCO S. 6919 585.9218
211 MEYER, SCOTT R. 3138 2,369.9243
212 MICHEL, PHILIPPE J. 3155 2,121.3607
213 MIHARA, TODD Y. 2686 699.3464
214 MIKITA, RICHARD J. 0671 3,391.3350
215 MILLER, MICHAEL G. 3390 1,324.3343
216 MILLER, PETER F. 4266 1,213.0598
217 MILLER, PHILIP G. 6475 707.7151
218 MILLER, WILLIAM A. 4339 1,760.2297
220 MITCHELL JR., CARL D. 3875 1,999.3213
221 MIX, ROBERT W. 2678 2,922.7404
222 MOCARSKI, JOSEPH J. 3862 2,254.1398
223 MOODIE, JOHN M. 0121 4,740.0162
224 MOORE, ERIC P. 2571 2,625.6089
225 MOORE, TED R. 0802 3,809.5051
226 MORELLA, RENO F. 2037 3,334.8196
227 MORIKI, ALVIN S. 0823 4,861.6674
228 MORIKI, REED M. 4348 2,183.0035
229 MORRISON, MICHELLE E. 3392 2,318.3463
230 MOSS, RICHARD T. 0123 4,742.0147
231 MOUDY, EVERETT R. 3330 2,071.6115
232 MYERS, DAVID LEE 0554 3,374.8957
234 NAGAMINE, DENNIS K. 0610 5,517.4649
235 NAKABAYASHI, LAINE H. 4061 2,013.5601
236 NELSON, TERRY LEE 0658 3,846.9454
237 NICHOLS, DAVID R. 2222 3,047.5822
238 NICOLAI, ERIC W. 3140 2,370.6387
239 NITTA, JEFREY M. 3381 2,319.3111
240 NORRIS, BOBBY L. 3331 2,323.2401
241 NORTHON, CHRISTOPHER J. 4137 2,134.3792
242 NOYES, WILLIAM H. 0837 5,043.5669
243 NUMBERS, DAVID M. 6918 585.9218
244 OBERNDORF, RICHARD T. 4270 1,905.8488
246 ORE, RANDY G. 3324 1,329.0647
247 O'LEARY, LAURI B.A. 3382 2,048.5073
248 O'NEILL, MARK B. 6738 606.9538
249 PAIGE, WARD T. 3326 2,323.6324
250 PARKS, BRIAN T. 2679 2,547.6595
251 PAVLIK II, HOWARD M. 4565 1,184.8310
4
<PAGE>
DISTRIBUTION TO ALPA 401k PLAN
ITEM NAME NBR 401k PLAN
---- ----------------------- ---- ----------
252 PENDLETON, MAURY C. 6910 585.9218
253 PEPE, JOHN A. 6476 707.9025
254 PERRY, LEROY T. 0701 4,617.6153
255 PERRY, WILLIAM J. 4141 1,221.7451
256 PESCH, DENNIS S. 5196 1,090.2670
257 PHIPPS, EDDIE C. 2955 2,484.5302
258 PICKERING, EDWARD N. 0408 3,768.9552
259 PLAHY JR., HOWARD E. 3321 2,323.1140
260 POSER, CLYDE 0936 3,269.6787
261 PRICE, RICHARD L. 2232 2,672.6263
262 PRINDLE, STEVEN E. 2573 2,932.2423
263 QUINN, THOMAS R. 4559 1,184.7110
264 RABEN JR., ROBERT W. 3594 2,303.0911
265 RAIKES, WALTER B. 5120 1,099.8448
267 RAMPEY, JAMES W. 4026 2,220.4807
268 REID, JOSEPH W. 6743 606.9538
270 REWICK, KENNETH E. 0410 3,771.8610
271 REYNOLDS IV, JOHN N. 6745 606.9538
272 RICHARDSON, DOUGLAS C. 3141 2,120.4655
273 RIGSBY, JAMES T. 3595 2,302.2092
274 ROGERS, JILL A. 6735 606.9538
275 ROGERS, RICHARD W. 4027 2,276.6450
276 ROSS, JOHN M. 6599 648.1343
277 RUTH, HOWARD B. 2664 2,895.9942
278 RYAN, MICHAEL P. 6598 648.1343
279 SAIKI, DAN E. 2956 2,400.2154
280 SAMPSON, ERIC H. 0566 3,050.3355
281 SANTINO, TAD D. 3749 1,946.7934
282 SAUL, CHARLES M. 4136 2,133.8062
283 SAVAGE, CAROLYN F. 3146 2,425.3250
285 SCHMIDT JR., JACK M. 2574 2,932.2445
286 SCOTT, MARY LYNN L.L. 4147 1,961.7655
287 SCOTT, RICHARD D. 0542 3,368.3429
288 SCOTT JR., ROBERT M. 2579 2,932.1419
289 SEARL, PETER C. 6803 648.1343
290 SEAVY, WILLIAM H. 3150 2,456.5690
292 SHANNON, DONALD R. 3322 2,071.9168
293 SHRINER, TIMOTHY J. 2575 1,466.4348
294 SHUPP, MARTIN H. 3384 2,239.0323
295 SILVA, MICHAEL A. 0411 2,296.7357
296 SMITH, LEON S. 6914 585.9218
298 SNEED, DAVID W. 2958 2,400.3199
299 SORENSEN, ALAN W. 5198 1,090.5298
300 SPEARS, VICTOR D. 2576 2,566.5401
301 STEELE, THOMAS J. 0447 1,583.1249
302 STELLA JR., JOSEPH W. 0714 4,621.8160
303 STODDARD, ARTHUR G. 3876 2,169.1644
304 STONE JR., DANIEL Q.K. 0635 5,496.6204
305 STORHAUG, THOMAS A. 2233 3,045.2885
306 STORY, DAVID J. 5122 1,098.6476
307 STRASSER, ERIC D. 6747 606.9538
308 STRAUSS, LARRY A. 2577 2,935.3515
309 SUSSEL, KENNETH R. 0399 3,047.3097
310 SWANNIE, JUDY Y. 6477 707.2512
311 SWEET, JAMES L. 4335 1,779.8607
312 SWEET, ROBERT B. 6912 585.9218
313 SWEET JR., RICHARD B. 0412 3,769.0953
314 SYLVESTER, KEITH J. 3142 2,371.8070
5
<PAGE>
DISTRIBUTION TO ALPA 401k PLAN
ITEM NAME NBR 401k PLAN
---- ----------------------- ---- ----------
315 TABATA, FRANCIS T. 3153 1,376.2077
316 TAINTOR, MARK D. 0416 3,890.3428
317 TAKEUCHI, ELMER Y. 2959 2,481.5048
318 TANABE, BARRY I. 6911 585.9218
319 TANI, ARNOLD T. 0418 3,767.9849
320 TARRIN, DENIS L. 2785 2,450.2422
321 TERRELL, LEMUEL D. 2234 3,045.0238
322 THOMAS, JOHN M. 0765 3,926.5256
323 THOMPSON, JAY S. 4148 2,133.6171
324 THOMPSON JR., JAMES A. 3872 2,249.7260
325 THORSTAD, ARTHUR A. 0726 4,625.0553
326 TIERNEY, MICHAEL E. 2682 2,551.9264
327 TINDALL, JOHN M. 6737 606.9538
328 TREGNAN, PATRICK M. 4557 1,214.2061
329 TRIMMER, THEODORE S. 3877 2,186.9376
330 TROYER, NICHOLAS G. 4442 1,209.4104
331 TURNER, WALTER D. 3597 1,326.7148
332 TYAU, JON S. 2559 1,789.4493
333 UNDERKOFLER, QUENTIN 0768 3,945.7030
334 URREA, DAVID B. 0126 4,739.5817
336 VON ZEDTWITZ III, JOHN 0628 3,857.7926
337 VOSS, CHRIS M. 2382 707.8083
338 WADE, JOHN C. 0625 2,236.3243
339 WAGEMANN, JAMES G. 0133 4,741.3182
340 WALLIS, PAUL B. 0349 3,328.5174
341 WATSON, BERNARD M. 0929 4,872.5134
342 WATSON, MICHAEL I. 4555 1,214.3850
343 WATT, JAMES E. 4272 1,935.1102
344 WEGHER, DAVID A. 0731 4,501.3756
345 WELLS, WILLIAM J. 4054 2,149.3256
347 WHEELER, TIMOTHY R. 2224 3,046.7135
348 WHITE, DARRELL T. 0841 3,939.7708
349 WHITE, RICHARD A. 0333 3,683.3310
350 WHITELEY, JOSEPH C. 2668 2,513.3658
352 WILLIS, ROBERT H. 3864 1,995.8516
353 WITTBRODT, TIGER D. 6746 606.9538
354 WOHLHUETER, KIM L. 3130 2,451.7380
355 WOLZ, HENRY 0. 2683 2,926.9233
356 WONG, GENE 1340 1,473.8243
357 WRIGHT, GEORGE W. 2100 3,282.1042
358 YANAGA, DWIGHT N. 4053 2,271.8992
359 YOUNG, MARK W. 2747 648.1343
360 YOUNG, THOMAS D. 0794 3,876.1312
361 ZANE, PHILIP B. 4518 1,218.3088
362 ZEFFIRO, WILLIAM E. 2603 707.3611
------------
TOTAL SHARES 787,700.5710
6
<PAGE>
ID # 6398a
AMENDMENT 2 TO
HAWAIIAN AIRLINES, INC.
PILOTS' 401(K) PLAN
In accordance with Section 21.6 of the Hawaiian Airlines, Inc.
Pilots' 401(k) Plan (hereinafter the "Plan"), the Plan is hereby amended in
the following respects:
1. Section 3.1(A) of the Plan is hereby amended to read in its entirety
as follows:
(A) MINIMUM SERVICE REQUIREMENT.
(1) This Section 3.1(A)(1) shall apply through December 31, 1993.
Each Employee shall commence participation on the first day of the
calendar quarter commencing after his completion of one Year of Service
with the Employer, commencing with the date he first completes an Hour
of Service (or an anniversary thereof). Any person who previously met
the foregoing requirements of this Section 3.1(A)(1), and who becomes
reemployed as an Employee shall commence participation on the first day
of the calendar quarter following his date of reemployment. A
reemployed Employee who has not previously met such requirements shall
be treated as a new Employee.
(2) This Section 3.1(A)(2) shall apply after December 31, 1993.
Each Employee shall commence participation on the first day of the month
commencing after his completion of one Year of Service with the
Employer, commencing with the date he first completes an Hour of Service
(or an anniversary thereof). Any person who previously met the
foregoing requirements of this Section 3.1(A)(2), and who becomes
reemployed as an Employee shall commence participation on the first day
of the month following his date of reemployment. A reemployed Employee
who has not previously met such requirements shall be treated as a new
Employee.
(3) In all cases, an Employee who completes 1,000 Hours of Service
during the 12-consecutive month period measured from the date he first
<PAGE>
completes an Hour of Service (or an anniversary thereof) shall be
regarded as completing one Year of Service.
2. Section 4.1(D)(3) of the Plan is hereby amended by adding the
following subparagraph (e) at the end thereof:
(e) If this Plan satisfies the requirements of Section 401(k)
of the Code only if aggregated with one or more plans, or if one or
more other plans satisfy the requirements of such section of the Code
only if aggregated with this Plan, then this Section 4.1(D) shall be
applied by determining the Actual Deferral Percentage of employees as
if all such plans were a single plan. The aggregation of this Plan
with any other plan is permissible only if the results of the Actual
Deferral Percentage test is no less favorable than when calculated
without such aggregation. Plans may be aggregated to satisfy
Section 401(k) of the Code only if they have the same plan year.
3. The first paragraph of Section 4.1(E) of the Plan is hereby
amended by adding the following sentences at the end thereof:
If such excess amounts are distributed more than 2-1/2 months after
the last day of the Plan Year in which such excess amounts arose, a 10%
excise tax shall be imposed on the Employer with respect to such
amounts. Such distributions shall be made to Highly Compensated
Employees on the basis of the respective portions of the Excess
Contributions attributable to each of such employees. Excess
Contributions of Participants who are subject to the Family Member
aggregation rules of Section 414(q)(6) shall be allocated among the
Family Members in proportion to the elective deferrals (and amounts
treated as elective deferrals) of each Family Member that is combined
to determine the combined Actual Deferral Percentage. The amount of
Excess Elective Deferrals that may be distributed with respect to a
Participant shall be reduced by any Excess Contributions previously
distributed or recharacterized with respect to such Member for the Plan
Year beginning with or within such taxable year.
2
<PAGE>
4. Section 4.5 of the Plan is hereby amended to read in its entirety as
follows:
4.5 RETURN OF CONTRIBUTIONS. Notwithstanding any other provisions of
this Plan:
(i) any contribution made because of a mistake of fact must
be returned to the Employer within one year of the contribution;
(ii) if the deduction of a contribution is disallowed under
Section 404 of the Code, such contribution (to the extent
disallowed) must be returned to the Employer within one year of
the disallowance of the deduction; or
(iii) if the Commissioner of Internal Revenue determines that
the Plan is not initially qualified under the Code, any
contribution made incident to that initial qualification by the
Employer must be returned to the Employer within one year after the
date the initial qualification is denied, but only if the
application for the qualification is made by the time prescribed
by law for filing the Employer's return for the taxable year in
which the Plan is adopted, or such later date as the Secretary of
the Treasury may prescribe.
Any contribution that is returned to the Employer shall be paid directly
to the Participants as compensation.
The amendments set forth herein shall be effective as of
January 1, 1989.
To record the adoption of this amendment, Hawaiian Airlines, Inc.
and the Air Line Pilots Association, International have executed this
document this 17th day of October, 1995.
---- -------
THE AIR LINE PILOTS HAWAIIAN AIRLINES, INC.
ASSOCIATION, INTERNATIONAL
/s/ J. R. Babbitt /s/ Bruce R. Nobles
------------------------- ------------------------------
J. Randolph Babbitt Bruce R. Nobles
President Chairman, President and CEO
/s/ Reno Morella /s/ Rae A. Capps
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Reno Morella, Chairman Rae A. Capps, Vice President,
Master Executive Council General Counsel and Corporate
Secretary
3
