<PAGE> 1
As filed with the Securities and Exchange Commission on March 5, 1999
Registration No. 333-_______
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
-------------------
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
------------------------------
<TABLE>
<CAPTION>
<S> <C>
STARWOOD HOTELS & RESORTS WORLDWIDE, STARWOOD HOTELS & RESORTS
INC. (EXACT NAME OF REGISTRANT AS SPECIFIED
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER) IN ITS CHARTER)
MARYLAND MARYLAND
(STATE OR OTHER JURISDICTION OF INCORPORATION OR (STATE OR OTHER JURISDICTION OF INCORPORATION OR
ORGANIZATION) ORGANIZATION)
52-0901263 52-1193298
(I.R.S. EMPLOYER IDENTIFICATION NO.) (I.R.S. EMPLOYER IDENTIFICATION NO.)
</TABLE>
777 WESTCHESTER AVENUE
WHITE PLAINS, NY 10604
(914) 640-8100
(ADDRESS INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
STARWOOD HOTELS & RESORTS WORLDWIDE, INC. SAVINGS AND RETIREMENT PLAN
(FULL TITLE OF THE PLAN)
THOMAS C. JANSON, JR., ESQ.
EXECUTIVE VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
777 WESTCHESTER AVENUE
WHITE PLAINS, NY 10604
(914) 640-8100
(NAME AND ADDRESS INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
INCLUDING AREA CODE, OF AGENT FOR SERVICE)
COPY TO:
LAURA A. LOFTIN
SIDLEY & AUSTIN
555 WEST FIFTH STREET
LOS ANGELES, CA 90013
(213) 896-6000
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Proposed
Proposed Maximum
Title Of Amount Maximum Aggregate Amount Of
Securities To Be Offering Price Offering Registration
to be Registered Registered Per Share (1) Price (1) Fee
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Shares of common stock, $0.01 par value, of
Starwood Hotels & Resorts Worldwide, Inc.
attached to shares of beneficial interest, $0.01
par value, of Starwood Hotels & Resorts (2) 500,000 $30.65625 $15,328,125 $4,261.22
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee, which
is calculated pursuant to Rules 457(h)(1) and 457(c) under the Securities Act of
1933 and based upon the average of the high and low sale prices of the shares on
the New York Stock Exchange on March 2, 1999.
(2) In addition, pursuant to Rule 416(c) under the Securities Act of 1933, this
registration statement also registers an undeterminate amount of interests to be
offered or sold pursuant to the Starwood Hotels & Resorts Worldwide, Inc.
Savings and Retirement Plan.
<PAGE> 2
PART I
INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS
Item 1. Plan Information*
Item 2. Registrant Information and Employee Plan Annual Information*
* Information required by Part I to be contained in the Section 10(a) prospectus
is omitted from the Registration Statement in accordance with Rule 428 under the
Securities Act of 1933, as amended (the "Securities Act"), and the Note to Part
I of Form S-8.
2
<PAGE> 3
PART II
INFORMATION REQUIRED IN THE
REGISTRATION STATEMENT
Item 3. Incorporation of Documents by Reference
The following documents previously filed by Starwood Hotels &
Resorts Worldwide, Inc., a Maryland corporation (the "Corporation"), and
Starwood Hotels & Resorts, a Maryland real estate investment trust (the "Trust"
and, together with the Corporation, the "Company"), are incorporated herein by
reference and shall be deemed to be a part hereof:
(a) The description of the shares of common stock of the
Corporation contained in the Registration Statement on Form 8-A filed by the
Corporation with the Securities and Exchange Commission (the "Commission") on
October 3, 1986;
(b) The description of the Class B shares of beneficial interest
of the Trust contained in the Registration Statement on Form 8-A filed by the
Trust with the Commission on December 21, 1998, including any amendment or
report filed for the purpose of updating such description;
(c) The Company's Joint Annual Report on Form 10-K for the fiscal
year ended December 31, 1997.
(d) The Company's Joint Quarterly Reports on Form 10-Q for the
periods ended March 31, 1998 (as amended by the Form 10-Q/A dated May 28, 1998),
June 30, 1998 and September 30, 1998 (as amended by the Form 10-Q/A dated
November 30, 1998).
(e) The Company's Joint Current Reports on Form 8-K dated January
2, 1998, February 3, 1998, February 23, 1998, February 24, 1998, April 24, 1998,
August 26, 1998, December 31, 1998 and January 6, 1999.
All documents filed by the Corporation and/or the Trust pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), as amended, 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, are deemed to be incorporated by reference
into this Registration Statement and to be a part hereof from the respective
dates of filing of such documents (such documents, and the documents enumerated
in paragraphs (a) through (d) above, being hereinafter referred to as
"Incorporated Documents").
Any statement contained in an Incorporated Document 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 Incorporated Document modifies or
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<PAGE> 4
supersedes such first 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
Not applicable.
Item 6. Indemnification of Directors and Officers
The charter of the Corporation (the "Charter") and the Amended and
Restated Declaration of the Trust (the "Trust Declaration") provide that the
Corporation and the Trust, respectively, shall indemnify, to the fullest extent
permitted by law, all persons who may be indemnified pursuant to the Maryland
General Corporation Law (the "MGCL") and Title 8 of the Corporations and
Associations Article of the Annotated Code of Maryland, respectively. The MGCL
requires a corporation or a Maryland real estate investment trust (a "Maryland
REIT") (unless its charter or declaration provides otherwise, which the Charter
and the Trust Declaration do not) to indemnify a director, trustee or officer
who has been successful, on the merits or otherwise, in the defense of any
proceeding to which he is made a party by reason of his service in that
capacity. The MGCL permits a corporation or Maryland REIT to indemnify its
present and former directors, trustees and officers, among others, against
judgments, penalties, fines, settlements and reasonable expenses actually
incurred by them in connection with any proceeding to which they may be made a
party by reason of their service in those or other capacities unless it is
established that (a) the act or omission of the director, trustee or officer was
material to the matter giving rise to the proceeding and (i) was committed in
bad faith or (ii) was the result of active and deliberate dishonesty, (b) the
director, trustee or officer actually received an improper personal benefit in
money, property or services or (c) in the case of any criminal proceeding, the
director, trustee or officer had reasonable cause to believe that the act or
omission was unlawful. However, under the MGCL, a Maryland corporation or a
Maryland REIT may not indemnify for an adverse judgment in a suit by or in the
right of the corporation or the Maryland REIT or for a judgment of liability on
the basis that personal benefit was improperly received, unless in either case a
court orders indemnification and then only for expenses. In addition, the MGCL
permits a corporation or a Maryland REIT to advance reasonable expenses to a
director, trustee or officer upon the receipt by the corporation or the Maryland
REIT of (a) written affirmation by the director, trustee or officer of his good
faith belief that he has met the standard of conduct necessary for
indemnification by the corporation and (b) a written undertaking by or on his
behalf to repay the amount paid or reimbursed by the corporation or the Maryland
REIT if it shall ultimately be determined that the standard of conduct was not
met.
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<PAGE> 5
Item 7. Exemption From Registration Claimed
Not applicable.
Item 8. Exhibits.
Exhibit
Number Description of Exhibit
4.1 Amended and Restated Articles of Incorporation of the
Corporation, as amended (incorporated by reference to
Exhibit 3.2 of the Joint Annual Report on Form 10-K for
the fiscal year ended December 31, 1997).
4.2 Amended and Restated Declaration of Trust of the Trust
(incorporated by reference to Exhibit 1 of the Trust's
Registration Statement on Form 8-A filed on December 21,
1998, except that the following changes were made on
January 6, 1999, upon the filing by the Trust and Merger
Sub of the Articles of Merger of Merger Sub into the
Trust (the "Articles of Merger") with, and the acceptance
thereof for record by, the State Department of
Assessments and Taxation of the State of Maryland (the
"SDAT"): Section 6.14 specifies January 6, 1999 as the
date of the Intercompany Agreement; Section 6.19.1
specifies January 6, 1999 as the date of the acceptance
for record by the SDAT of the Articles of Merger; and the
definition of "Intercompany Agreement" in Section 6.19.2
specifies January 6, 1999 as the date of the Intercompany
Agreement).
*4.3 Amended and Restated Bylaws of the Corporation.
4.4 Bylaws of the Trust (incorporated by reference to Exhibit
2 of the Trust's Registration Statement on Form 8-A filed
on December 21, 1998).
4.5 Amended and Restated Intercompany Agreement dated as of
January 6, 1999, between the Corporation and the Trust
(incorporated by reference to Exhibit 3 of the Trust's
Registration Statement on Form 8-A filed on December 21,
1998, except that on January 6, 1999, the Intercompany
Agreement was executed and dated as of January 6, 1999).
*4.6 Starwood Hotels & Resorts Worldwide, Inc. Savings and
Retirement Plan.
5.1 The Registrants will submit the Starwood Hotels & Resorts
Worldwide, Inc. Savings and Retirement Plan (the "Plan")
and any amendment thereto to the Internal Revenue Service
(the "IRS") in a timely manner and will
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<PAGE> 6
make all changes required by the IRS in order to qualify
the Plan under Section 401 of the Internal Revenue Code.
*23.1 Consent of PricewaterhouseCoopers, LLP.
*23.2 Consent of Arthur Andersen LLP.
*24.1 Powers of Attorney (included on signature pages hereto).
- ------------------------
* Filed herewith.
Item 9. Undertakings
Each of the undersigned registrants (the "Registrants") hereby
undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, as amended (the "Securities Act of 1933");
(ii) To reflect in the prospectus any facts or events arising
after the effective date of this 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 this 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 and 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 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 this Registration
Statement or any material change to such information in this
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if this
Registration Statement is on Form S-3, Form S-8 or Form F-3, and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the Commission by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in this Registration Statement.
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<PAGE> 7
(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 the time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(4) If either Registrant is a foreign private issuer, to file a
post-effective amendment to the Registration Statement to include any financial
statements required by Rule 3-19 of this chapter at the start of any delayed
offering or throughout a continuous offering. Financial statements and
information otherwise required by Section 10(a)(3) of the Act need not be
furnished, provided, that such Registrant includes in the prospectus, by means
of a post-effective amendment, financial statements required pursuant to this
paragraph (4) and other information necessary to ensure that all other
information in the prospectus is at least as current as the date of those
financial statements. Notwithstanding the foregoing, with respect to
registration statements on Form F-3, a post-effective amendment need not be
filed to include financial statements and information required by Section
10(a)(3) of the Act or Rule 3-19 of this chapter if such financial statements
and information are contained in periodic reports filed with or furnished to the
Commission by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the Form
F-3.
Each 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 this 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.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of a
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 a 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.
II-5
<PAGE> 8
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, each of the Registrants 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 on Form S-8 to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of White Plains,
State of New York, on this 5th day of March, 1999.
STARWOOD HOTELS & RESORTS
WORLDWIDE, INC.
By: /s/ Ronald C. Brown
---------------------------------------------
Ronald C. Brown
Executive Vice President and
Chief Financial Officer
POWER OF ATTORNEY
Each person whose signature to the Registration Statement appears
below hereby appoints Ronald C. Brown and Thomas C. Janson, Jr., and each of
them, as his or her attorneys-in-fact, with full power of substitution and
resubstitution, to execute in the name and on behalf of such person,
individually and in the capacity stated below, and to file, all amendments to
this Registration Statement, which amendments may make such changes in and
additions to this Registration Statement as such attorneys-in-fact may deem
necessary or appropriate.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Barry S. Sternlicht Chairman of the Board, Chief March 5, 1999
Barry S. Sternlicht Executive Officer and Director
(Principal Executive Officer)
/s/ Richard D. Nanula President, Chief Operating Officer March 5, 1999
Richard D. Nanula and Director
/s/ Ronald C. Brown Executive Vice President and March 5, 1999
Ronald C. Brown Chief Financial Officer (Principal
Financial and Accounting Officer)
</TABLE>
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<PAGE> 9
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Brenda C. Barnes Director March 5, 1999
Brenda C. Barnes
/s/ Juergen Bartels Director March 5, 1999
Juergen Bartels
/s/ Jonathan D. Eilian Director March 5, 1999
Jonathan D. Eilian
/s/ Earle F. Jones Director March 5, 1999
Earle F. Jones
/s/ Michael A. Leven Director March 5, 1999
Michael A. Leven
/s/ Daniel H. Stern Director March 5, 1999
Daniel H. Stern
/s/ Daniel W. Yih Director March 5, 1999
Daniel W. Yih
</TABLE>
II-7
<PAGE> 10
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, each of the Registrants 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 on Form S-8 to be signed on its behalf
by the undersigned, thereunto duly authorized, in the City of White Plains,
State of New York, on this 5th day of March, 1999.
STARWOOD HOTELS & RESORTS
/s/ Barry S. Sternlicht
By:_______________________________________________
Barry S. Sternlicht
Chairman and Chief Executive Officer
POWER OF ATTORNEY
Each person whose signature to the Registration Statement appears
below hereby appoints Ronald C. Brown and Madison F. Grose, and each of them, as
his attorneys-in-fact, with full power of substitution and resubstitution, to
execute in the name and on behalf of such person, individually and in the
capacity stated below, and to file, all amendments to this Registration
Statement, which amendments may make such changes in and additions to this
Registration Statement as such attorneys-in-fact may deem necessary or
appropriate.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the date indicated.
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Barry S. Sternlicht
________________________ Chairman, Chief Executive March 5, 1999
Barry S. Sternlicht Officer and Trustee
(Principal Executive, Financial
and Accounting Officer)
/s/ Jean-Marc Chapus
________________________ Trustee March 5, 1999
Jean-Marc Chapus
/s/ Bruce W. Duncan
________________________ Trustee March 5, 1999
Bruce W. Duncan
</TABLE>
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<PAGE> 11
<TABLE>
<CAPTION>
<S> <C> <C>
/s/ Madison F. Grose Trustee March 5, 1999
- -------------------------
Madison F. Grose
/s/ George J. Mitchell Trustee March 5, 1999
- -------------------------
George J. Mitchell
/s/ Stephen R. Quazzo Trustee March 5, 1999
- -------------------------
Stephen R. Quazzo
Trustee March , 1999
- -------------------------
Raymond S. Troubh
</TABLE>
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<PAGE> 12
Pursuant to the requirements of the Securities Act of 1933, the trustee
(or other persons who administer the employee benefit plan) have duly caused
this registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the city of Phoenix, State of Arizona, on March
5, 1999.
STARWOOD HOTELS & RESORTS
WORLDWIDE, INC.
SAVINGS AND RETIREMENT PLAN
/s/ Susan R. Bolger
---------------------------------------------------
By: Susan R. Bolger
Title: Executive Vice President - Human
Resources
II-10
<PAGE> 13
EXHIBIT INDEX
Exhibit
Number Exhibit
4.1 Amended and Restated Articles of Incorporation of
Starwood Hotels & Resorts Worldwide, Inc. (formerly
Starwood Lodging Corporation), a Maryland corporation
(the "Corporation"), as amended (incorporated by
reference to Exhibit 3.2 of the Joint Annual Report on
Form 10-K for the fiscal year ended December 31, 1997).
4.2 Amended and Restated Declaration of Trust of Starwood
Hotels & Resorts (formerly Starwood Lodging Trust), a
Maryland real estate investment trust (the "Trust")
(incorporated by reference to Exhibit 1 of the Trust's
Registration Statement on Form 8-A filed on December 21,
1998, except that the following changes were made on
January 6, 1999, upon the filing by the Trust and Merger
Sub of the Articles of Merger of Merger Sub into the
Trust (the "Articles of Merger") with, and the acceptance
thereof for record by, the State Department of
Assessments and Taxation of the State of Maryland (the
"SDAT"): Section 6.14 specifies January 6, 1999 as the
date of the Intercompany Agreement; Section 6.19.1
specifies January 6, 1999 as the date of the acceptance
for record by the SDAT of the Articles of Merger; and the
definition of "Intercompany Agreement" in Section 6.19.2
specifies January 6, 1999 as the date of the Intercompany
Agreement).
*4.3 Amended and Restated Bylaws of the Corporation, as
amended.
4.4 Bylaws of the Trust (incorporated by reference to Exhibit
2 of the Trust's Registration Statement on Form 8-A filed
on December 21, 1998).
4.5 Amended and Restated Intercompany Agreement dated as of
January 6, 1999, between the Corporation and the Trust
(incorporated by reference to Exhibit 3 of the Trust's
Registration Statement on Form 8-A filed on December 21,
1998, except that on January 6, 1999, the Intercompany
Agreement was executed and dated as of January 6, 1999).
*4.6 Starwood Hotels & Resorts Worldwide, Inc. Savings and
Retirement Plan.
5.1 The Registrants will submit the Plan and any amendment
thereto to the IRS in a timely manner and will make all
changes required by the IRS in order to qualify the Plan
under Section 401 of the Internal Revenue Code.
*23.1 Consent of PricewaterhouseCoopers, LLP.
<PAGE> 14
*23.2 Consent of Arthur Andersen LLP.
*24.1 Powers of Attorney (included on signature pages hereto).
- ------------------------
* Filed herewith.
II-13
<PAGE> 1
Exhibit 4.3
AMENDED AND RESTATED
BYLAWS OF
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
(AS AMENDED AND RESTATED THROUGH NOVEMBER 19, 1998)
ARTICLE I
OFFICES
In addition to the required principal office, Starwood Hotels &
Resorts Worldwide, Inc. (the "Corporation") may have such offices at such
places, both within and without the State of Maryland, as the Board of Directors
from time to time determines or as the business of the Corporation from time to
time requires.
ARTICLE II
MEETINGS OF THE STOCKHOLDERS
SECTION 1. ANNUAL MEETINGS. Annual meetings of the stockholders
shall be held on such date and at such time and at such place in the United
States (within or without the State of Maryland) as is designated from time to
time by the Board of Directors and stated in the notice of the meeting. At each
annual meeting the stockholders shall elect Directors and shall transact such
other business as may properly be brought before the meeting.
SECTION 2. SPECIAL MEETINGS. Unless otherwise prescribed by law,
the Articles of Incorporation or these Bylaws, special meetings of the
stockholders for any purpose or purposes may be called by the Board of
Directors, the Chairman of the Board or any two or more Directors, or by the
Secretary upon the written request of stockholders owning not less than a
majority of the shares of capital stock of the Corporation issued and
outstanding and entitled to vote at any such meeting. Special meetings shall be
held at such place in the United States (within or without the State of
Maryland) as is designated by the Board of Directors and stated in the notice of
the meeting. Requests for special meetings shall state the purpose or purposes
of the proposed meeting. Unless requested by stockholders entitled to cast a
majority of all votes entitled to be cast at the meeting, a special meeting need
not be called to consider any matter which is substantially the same as a matter
voted on at any special meeting of the stockholders held during the preceding
twelve (12) months.
Within twenty (20) days after the Corporation receives a
stockholder request for the calling of a special meeting, the Board of Directors
shall designate the date on which such meeting is to be held and the Secretary
shall inform the stockholders who make the request of the reasonably estimated
costs of preparing and mailing a notice of the meeting, and on payment of those
costs to the Corporation, notify each stockholder entitled to notice of the
meeting. Any such special meeting shall be held on a date not earlier than the
twentieth (20th) day, and not later than the ninetieth (90th) day, following the
date on which such notice is given.
<PAGE> 2
Notwithstanding the foregoing, if as of the date a stockholder
request for a special meeting is received or within twenty (20) days thereafter,
the Board of Directors has called or calls a meeting of stockholders (whether
annual or special) for a purpose or purposes other than the purpose(s) stated in
the stockholder request, the Board of Directors need not call, and the Secretary
need not give notice of, a separate and additional meeting of stockholders if
(i) the Board of Directors determines in good faith that calling such a separate
and additional meeting would require the Corporation to incur undue cost and
expense, and (ii) the Secretary notifies both the requesting stockholder(s) and
all other stockholders entitled to vote, within twenty (20) days after the
Corporation receives the stockholder request, that the matter(s) proposed by the
requesting stockholder(s) to be considered at a special meeting may be proposed
and considered at the meeting otherwise called by the Board of Directors. In
addition, if not later than the thirtieth (30th) day prior to the date on which
any special meeting called by the Board of Directors pursuant to a stockholder
request is to be held, the Board of Directors determines in good faith to
present for consideration by the stockholders of the Corporation one or more
matters other than those proposed by the requesting stockholder(s) to be so
considered, the Board of Directors may postpone the previously called special
meeting for a period of up to sixty (60) days following the date on which notice
of such postponement is given. Notice of such postponement and of the additional
matter(s) to be considered at such meeting shall be given by the Secretary not
later than the thirtieth (30th) day prior to the originally scheduled meeting
date.
SECTION 3. PRESIDING OFFICERS. Meetings of the stockholders shall
be presided over by the Chairman of the Board or by the President (as determined
by the Board of Directors) or, if the Chairman of the Board and the President
are not present, by a Vice President, or, if a Vice President is not present,
such person who is chosen by the Board of Directors, or, if none, by a person to
be chosen at the meeting by stockholders present in person or by proxy who own a
majority of the shares of capital stock of the Corporation entitled to vote and
be represented at such meeting. The secretary of meetings shall be the Secretary
of the Corporation, or an Assistant Secretary or such other person as may be
chosen by the Board of Directors, or, if none, such person who is chosen by the
chairman of the meeting.
The presiding officer at a meeting of the stockholders shall have
all power and authority vested in a presiding officer by law or practice,
including, without limitation, the authority to determine whether the nomination
of any person is made in compliance with applicable provisions of these Bylaws
(and to refuse to acknowledge the nomination of any person not made in such
compliance); to determine whether any item of business proposed to be brought
before the meeting has been properly brought (and to declare that any business
not so brought shall be disregarded and not transacted); to establish rules
pertaining to reasonable time limits and the amount of time that may be taken up
in remarks by any stockholder or group of stockholders and otherwise pertaining
to the conduct of the meeting; and to otherwise decide all matters relating to
the conduct of the meeting. The presiding officer may appoint a parliamentarian
and one or more sergeants-at-arms. The parliamentarian may advise the presiding
officer upon matters relating to the conduct of the stockholders' meeting. The
sergeant- or sergeants-at-arms shall have authority to take any and all actions
that such persons deem necessary or appropriate to assure that the meeting is
conducted with decorum and in an orderly manner, including, without limitation,
authority to expel or cause the expulsion of any person who the presiding
officer determines is failing to comply with the rules concerning the conduct
of, or is otherwise disrupting, the meeting.
SECTION 4. ADJOURNMENTS. Whether or not a quorum is present at
any meeting of the stockholders, the stockholders entitled to vote thereat
present in person or by proxy shall have the power to adjourn the meeting from
time to time, without notice of the adjourned meeting if the time and place
thereof are announced at the meeting at which the adjournment is taken. Any
business which might have been transacted at a meeting as originally called may
be transacted at any meeting held after adjournment
2
<PAGE> 3
as provided in this Section 4, if a quorum is present in person or by proxy at
such reconvened meeting.
SECTION 5. PROXIES. Whenever the vote or consent of stockholders
is required or permitted, such vote or consent may be given by a stockholder in
person or by proxy. The appointment of a proxy or proxies shall be made by an
instrument in writing executed by the stockholder or the stockholder's duly
authorized agent and filed with the Secretary of the Corporation. No proxy shall
be valid after the expiration of eleven (11) months from the date of its
execution unless the stockholder executing it specifies therein the length of
time for which it is to continue in force. At a meeting of stockholders all
questions concerning the qualification of voters, the validity of proxies, and
the acceptance or rejection of votes, shall be decided by the secretary of the
meeting unless inspectors of election are appointed pursuant to Section 6 of
this Article II, in which event such inspectors shall pass upon all questions
and shall have all other duties specified in said section.
SECTION 6. INSPECTORS OF ELECTION. In advance of any meeting of
the stockholders, the Board of Directors may appoint any one or more persons
(other than nominees for office) to act as inspectors of election at the meeting
or any adjournment thereof. If no inspector of election is so appointed, the
presiding officer of the meeting may, and on the request of any stockholder or
any stockholder's proxy shall, appoint one or more such inspectors of election.
The number of inspectors shall be either one (1) or three (3), as determined by
the presiding officer; provided, however, that if such inspector(s) is or are to
be appointed at the meeting on the request of one or more stockholders or
proxies, the holders of a majority of the total number of shares represented at
the meeting (in person or by duly executed proxy) shall determine whether one
(1) or three (3) inspectors are to be appointed. If any person appointed as
inspector of election fails to appear at the meeting or fails or refuses to act
as inspector, the presiding officer of the meeting may, and upon the request of
any stockholder or any stockholder's proxy shall, appoint a person to fill that
vacancy. The inspectors of election shall:
(a) Determine the number of shares of capital stock outstanding
and the voting power of each, the shares represented at the meeting, the
existence of a quorum, and the authenticity, validity and effect of proxies;
(b) Receive votes, ballots or consents;
(c) Count and tabulate all votes or consents;
(d) Determine and report to the Corporation the results of the
voting; and
(e) Do any other acts that may be proper to conduct the election
or vote with fairness to all stockholders.
On request of the presiding officer of the meeting or of any
stockholder or any stockholder's proxy, the inspector(s) of election shall make
a report in writing of any question or other matter determined by him or them
and execute a certificate of any facts found by him or them.
If there are three (3) inspectors of election, the decision, act,
report or certificate of a majority shall be effective in all respects as the
decision, act, report or certificate of the inspectors.
SECTION 7. BUSINESS. Except as may be otherwise provided by
applicable law, the only business that shall be conducted at any meeting of the
stockholders (other than matters incident to the
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conduct of the meeting) shall be business brought before the meeting by or at
the direction of the Board of Directors or by a stockholder who complies with
the procedures set forth in this Section 7.
Except as otherwise provided by Section 2 of this Article III or
by applicable law, the only business that shall be conducted at any meeting of
the stockholders shall (i) have been specified in the notice of the meeting (or
any supplement thereto) given by or at the direction of the Board of Directors,
(ii) otherwise be brought before such meeting by or at the direction of the
Board of Directors or the presiding officer of the meeting, or (iii) be
otherwise properly brought before the meeting by or on behalf of a stockholder
who shall have been a stockholder of record on the record date for such meeting,
who shall continue to be entitled to vote thereat, and who shall have complied
with the procedures set forth in the remainder of this Section 7. In addition to
any and all other applicable requirements, for business to be properly brought
before a meeting of the stockholders by a stockholder, the stockholder must have
given timely notice thereat in writing to the Secretary. To be timely, a
stockholder's notice must be delivered personally, or mailed to and received at,
the principal executive offices of the Corporation (i) in the case of an annual
meeting, not earlier than the close of business on the 75th day nor later than
the close of business on the 50th day prior to the first anniversary of the
preceding year's annual meeting; provided, however, that in the event that the
date of the annual meeting is advanced by more than 30 days or delayed by more
than 60 days from such anniversary date or if the Corporation has not previously
held an annual meeting, notice by the stockholder to be timely must be so
delivered not earlier than the close of business on the 75th day prior to such
annual meeting and not later than the close of business on the later of the 50th
day prior to such annual meeting or the tenth day following the day on which
public announcement of the date of such meeting is first made by the
Corporation, or (ii) in the case of a special meeting, within ten days of the
earlier of (a) the date that notice of the meeting was mailed in accordance with
Article II hereof or prior public disclosure of the date of the meeting was
made, or (b) the date that a request for a special meeting was made by a
stockholder in accordance with Section 2 of Article II hereof.
A stockholder's notice to the Secretary shall set forth (i) a
description of each item of business the stockholder proposes to bring before
the meeting and the wording of the proposal, if any, to be submitted for a vote
of the stockholders with respect thereto; (ii) the name and address of the
stockholder; (iii) the class and number of shares of stock of the Corporation
held of record, owned beneficially and represented by proxy by such stockholder
as of the record date for the meeting (if such date shall then have been
publicly disclosed) and as of the date of such notice; and (iv) all other
information that would be required to be included in a proxy statement filed
with the Securities and Exchange Commission (the "SEC") if, with respect to any
such item of business, such stockholder were a participant in a solicitation
subject to Section 14 of the Securities Exchange Act of 1934 as in effect on
June 25, 1998 (the "Exchange Act"), as from time to time amended.
SECTION 8. INFORMAL ACTION BY STOCKHOLDERS. Any action required
or permitted to be taken at a meeting of stockholders may be taken without a
meeting if there is filed with the records of stockholders meetings a unanimous
written consent which sets forth the action and is signed by each stockholder
entitled to vote on the matter and a written waiver of any right to dissent
signed by each stockholder entitled to notice of the meeting but not entitled to
vote at it.
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ARTICLE III
DIRECTORS
SECTION 1. NUMBER; TENURE. The number of directors of the
Corporation shall be not less than three (3) nor more than fifteen (15), and,
within these limits, may be fixed, increased or decreased from time to time by a
majority of the entire Board of Directors, but no such action may affect the
tenure of office of any director.
The directors shall be divided, with respect to the time for
which they severally hold office, into three classes, as nearly equal in number
as reasonably possible, with each director to hold office until his or her
successor shall have been duly elected and qualified. At each annual meeting of
stockholders (i) directors elected to succeed the class of directors whose terms
then expire shall be elected for a term of office to expire at the third
succeeding annual meeting of stockholders after their election, with each
director of the class to hold office until his or her successor shall have been
duly elected and qualified and (ii) except as otherwise required by law, if
authorized by a resolution of the Board of Directors, directors may be elected
to fill any vacancy on the Board of Directors, regardless of how such vacancy
shall have been created.
SECTION 2. NOMINATION OF DIRECTORS. Nominations of persons for
election to the Board of Directors at an annual meeting of the stockholders may
be made at such meeting only by or at the direction of the Board of Directors,
by any nominating committee or person(s) appointed by the Board of Directors, or
by any stockholder entitled to vote for the election of Directors at the meeting
who complies with the notice procedures set forth in this Section 2.
Any stockholder entitled to vote for the election of Directors
may nominate one or more persons for election to the Board of Directors at a
meeting only if written notice of such stockholder's intent to make such
nomination or nominations has been delivered personally to the Secretary at, or
been mailed to the Secretary and received at, the principal executive offices of
the Corporation not earlier than the close of business on the 75th day nor later
than the close of business on the 50th day prior to the first anniversary of the
preceding year's annual meeting; provided, however, that in the event that the
date of the annual meeting is advanced by more than 30 days or delayed by more
than 60 days from such anniversary date or if the Corporation has not previously
held an annual meeting, notice by the stockholder to be timely must be so
delivered not earlier than the close of business on the 75th day prior to such
annual meeting and not later than the close of business on the later of the 50th
day prior to such annual meeting or the tenth day following the day on which
public announcement of the date of such meeting is first made by the
Corporation. Such stockholder's notice to the Secretary shall set forth: (i) the
name and address of the stockholder who intends to make the nomination(s) and of
the person or persons to be nominated; (ii) the class and number of shares of
stock of the Corporation that are held of record, beneficially owned and
represented by proxy by such stockholder as of the record date for the meeting
(if such date then shall have been made publicly available) and as of the date
of such notice; (iii) a representation that such stockholder intends to appear
in person or by proxy at the meeting to nominate the person or persons specified
in the notice; (iv) a description of any contract, arrangement or understanding
between such stockholder and each nominee and any other person or persons
(naming such person or person) pursuant to which the nomination or nominations
are to be made by such stockholder; (v) such other information regarding each
nominee proposed by such stockholder as would be required to be disclosed in a
proxy statement used in a solicitation of proxies for the election of directors
which solicitation was subject to the rules and regulations of the SEC under
Section 14 of the Exchange Act; and (vi) the consent of each nominee to serve as
a Director of the Corporation if so elected.
No person shall be eligible for election as a Director of the
Corporation unless nominated in accordance with the procedures set forth herein.
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SECTION 3. CHAIRMAN OF THE BOARD. The Chairman of the Board shall
be chosen by the vote of a majority of the entire Board of Directors. The
Chairman of the Board, if present, shall preside at all meetings of the Board of
Directors. The Chairman of the Board shall be, ex officio, a member of all
standing committees, but shall not in the capacity as Chairman of the Board be
deemed an officer of the Corporation.
SECTION 4. VACANCIES. Except as otherwise required by law, unless
the Board of Directors otherwise determines, newly created directorships
resulting from any increase in the authorized number of directors or any
vacancies on the Board of Directors resulting from any cause shall be filled
only by a majority vote of the directors then in office, though less than a
quorum, and directors so chosen shall hold office for a term expiring at the
annual meeting of stockholders at which the term of office of the class to which
they have been elected expires and until such director's successor shall have
been duly elected and qualified. No decrease in the numbers of authorized
directors constituting the entire Board of Directors shall shorten the term of
any incumbent director.
SECTION 5. RESIGNATION. Any director may resign at any time by
giving written notice to the Board of Directors, the Chairman of the Board, the
Present, or the Secretary of the Corporation. Unless otherwise specified in such
written notice, a resignation shall take effect upon delivery thereof. A
resignation need not be accepted in order for it to be effective.
SECTION 6. PLACE OF MEETINGS. Each meeting of the Board of
Directors shall be held at such place within or without the State of Maryland as
is fixed from time to time by resolution of the Board of Directors (or, in the
absence of such resolution, as specified in the notice of such meeting).
SECTION 7. ANNUAL MEETING. Promptly following each Annual Meeting
of Shareholders, a meeting of the Board of Directors shall be held for the
purpose of electing officers and transacting other business. Notice of such
meetings need not be given.
SECTION 8. REGULAR MEETINGS. Regular meetings of the Board of
Directors need not be held.
SECTION 9. SPECIAL MEETINGS. Special meetings of the Board of
Directors may be called at any time by the Chairman of the Board, and the
Chairman of the Board shall call a special meeting at any time upon the written
request of two (2) directors. Written notice of the time and place of a special
meeting shall be given to each director, either personally or by sending a copy
thereof by mail or by telecopier to his or her address appearing on the books of
the Corporation or theretofore given by him or her to the Corporation for the
purpose of notice. In case of personal service or notice by telecopier, such
notice shall be so delivered at least twenty-four (24) hours prior to the time
fixed for the meeting. If such notice is mailed it shall be deposited in the
United States mail at least seventy-two (72) hours prior to the time fixed for
the holding of the meeting. Notice of a meeting may be given by the Chairman of
the Board, the Directors requesting the meeting or the Secretary.
SECTION 10. ADJOURNMENTS. A quorum of the directors may adjourn
any meeting of the Board of Directors to meet again at a stated day and hour. In
the absence of a quorum a majority of the directors present may adjourn from
time to time to meet again at a stated day and hour prior to the time fixed for
the next regular meeting of the Board of Directors. Notice of the time and place
of an adjourned meeting need not be given to any director of the time and place
is fixed at the meeting adjourned.
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SECTION 11. COMPENSATION. Directors shall be entitled to such
compensation for their services as directors as from time to time may be fixed
by the Board of Directors. No director who receives compensation as a director
shall be barred from serving the Corporation in any other capacity or from
receiving compensation and reimbursement of reasonable expenses for any or all
such other services.
SECTION 12. ACTION BY CONSENT. Any action required or permitted
to be taken at any meeting of the Board of Directors may be taken without a
meeting and without prior notice if a written consent in lieu of such meeting
which sets forth the action so taken is signed either before or after such
action by all directors. All written consents shall be filed with the minutes of
the Board's proceedings.
SECTION 13. MEETINGS BY TELEPHONE OR SIMILAR COMMUNICATIONS. The
Board of Directors may participate in meetings by means of conference telephone
or similar communications equipment, whereby all directors participating in the
meeting can hear each other at the same time, and participation in any such
meeting shall constitute presence in person at such meeting. A written record
shall be made of all actions taken at any meeting conducted by a means of a
conference telephone or similar communications equipment.
SECTION 14. TRANSACTIONS WITH INTERESTED PERSONS. (a)
Notwithstanding anything to the contrary contained in these Bylaws, in addition
to any affirmative vote required either by law, the Partnership Agreement, the
Articles of Incorporation of the Corporation or these Bylaws, any Transaction
involving the Corporation or any of its subsidiaries or the Operating
Partnership shall require the affirmative vote of a majority of the directors
("Disinterested Members") on the Board of Directors of the Corporation who are
not employees, officers, directors, Affiliates or Associates of the Interested
Person who or which is a party to the Transaction.
(b) As used in this Section 14:
(i) "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 of the General Rules and
Regulations under the Exchange Act.
(ii) A Person shall "Beneficially Own" and be the "Beneficial
Owner" of any Paired Shares or Units:
(A) which such Person or any of its Affiliates or
Associates or Associates beneficially owns, directly or
indirectly, within the meaning of Rule 13d-3 under the Exchange
Act; or
(B) which such Person or any of its Affiliates or
Associates has (I) the right to acquire (whether such right is
exercisable immediately or only after the passage of time),
pursuant to any agreement, arrangement or understanding or upon
the exercise of conversion rights, exchange rights, warrants or
options, or otherwise, or (II) the right to vote pursuant to any
agreement, arrangement or understanding (but neither such Person
nor any such Affiliate or Associate shall be deemed to be the
Beneficial Owner of any Paired Shares of Units solely by reason
of a revocable proxy granted for a particular meeting of
stockholders, pursuant to a public solicitation of proxies for
such meeting, and with respect to which Paired Shares or Units
neither such Person not any such Affiliate or Associate is
otherwise deemed the Beneficial Owner); or
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(C) which are beneficially owned, directly or indirectly,
within the meaning of the Rule 13d-3 under Exchange Act, by any
other Person with which such Person or any of its Affiliates or
Associates has any agreement, arrangement or understanding for
the purpose of acquiring, holding, voting (other than solely by
reason of a revocable proxy as described in subparagraph (B)
above) or disposing of any Paired Shares or Units.
(iii) "Interested Person" shall mean any Person who or which is
the Beneficial Owner, directly or indirectly, of 5% or more the
outstanding Paired Shares or the outstanding Units or who or which is an
Affiliate or Associate of the Trust, the Corporation or either of the
Partnerships. for the purposes of determining whether a Person is an
Interested Person, the number of Paired Shares or Units deemed to be
outstanding shall include Paired Shares or Units deemed owned through
application of paragraphs (A), (B) and (C) of paragraph (ii) above but
shall not include any other unissued Paired Shares or Units which may be
issuable pursuant to any agreement, arrangement or understanding, or
upon exercise of conversion rights, warrants or options, or otherwise.
(iv) "Operating Partnership" shall mean SLC Operating Limited
Partnership, a Delaware limited partnership.
(v) "Paired Shares" shall mean the shares of common stock of the
Corporation and the shares of beneficial interest of the Trust which are
paired pursuant to the Pairing Agreement dated June 25, 1980 between the
Trust and the Corporation, as amended from time to time.
(vi) "Partnership Agreement" shall mean the Limited Partnership
Agreement of the Operating Partnership, as amended from time to time.
(vii) "Partnerships" shall mean the Operating Partnership and SLT
Realty Limited Partnership, a Delaware limited partnership.
(viii) "Person" shall mean any individual, limited partnership,
general partnership, corporation, limited liability company or any other
firm or entity.
(ix) "Transaction" shall mean any contract, sale, lease,
exchange, mortgage, transfer or disposition to or with, or any other
transaction with, any Interested Person, including, without limitation,
any election with respect to the method of payment for an exchange of
Units for Paired Shares or any action to be taken by the Corporation,
the Trust or the Partnerships with respect to the senior debt of SLT
Realty Limited Partnership.
(x) "Trust" shall mean Starwood Hotels & Resorts, a Maryland real
estate investment trust.
(xi) "Units" shall have the meaning set forth in the Partnership
Agreement.
(c) A majority of the Disinterested Members shall have the power
and duty to determine, on the basis of information known to them after
reasonable inquiry, all facts necessary to determine compliance with this
Section 14, including, without limitation, (i) whether a Person is an Interested
Person, (ii) the number of Paired Shares or Units that any Person Beneficially
Owns, and (iii) whether a Person is an Affiliate or Associate of another. A
majority of the Disinterested Members shall have the right to
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demand that any Person who is reasonably believed to be an Interested Person (or
who holds of record Paired Shares or Units that any Interested Person
Beneficially Owns) supply the Corporation with complete information as to (i)
the record owner(s) of all Paired Shares or Units that such Person who is
reasonably believed to be an Interested Person Beneficially Owns, (ii) the
number of, and class or series of, Paired Shares or Units that such Person who
is reasonably believed to be an Interested Person Beneficially Owns and the
number(s) of the certificate(s), if any, evidencing such Paired Shares or Units
and (iii) any other factual matter relating to the applicability or effect of
this Section 14, as may be reasonably requested of such Person, and such Person
shall furnish such information within 10 days after receipt of such demand.
(d) Nothing contained in this Section 14 shall be construed to
relieve any Interested Person from any fiduciary obligation imposed by law.
(e) Notwithstanding anything to the contrary contained in these
Bylaws, this Section 14 may be amended or repealed only by a majority of
directors on the Board of Directors of the Corporation who are not employees,
officers, Affiliates or Associates of the Trust, the Corporation, the
Partnerships or any Interested Person.
SECTION 15. WAIVER OF NOTICE. The transactions of any meeting of
the Directors, however called and noticed or wherever held, shall be as valid as
though had at a meeting duly held after regular call and notice if a quorum is
present and if either before or after the meeting each of the Directors not
present signs a written waiver of notice or a consent to the holding of such
meeting or an approval of the minutes thereof. All such waivers, consents, or
approvals shall be lodged with the Corporation records or made a part of the
minutes of the meeting.
SECTION 16. INDEPENDENT DIRECTORS. Notwithstanding anything to
the contrary contained in these Bylaws, not less than a majority of the Board of
Directors of the Corporation shall be composed of "Independent Directors." For
purposes of this Section 16, an "Independent Director" is a Director of the
Corporation who is not employed by or an affiliate (as defined in Rule 12b-2 of
the General Rules and Regulations under the Exchange Act) of the Corporation,
the Trust or Starwood Capital Group, L.L.C.
ARTICLE IV
COMMITTEES
SECTION 1. EXECUTIVE COMMITTEE. (a) The Board of Directors may
appoint two or more directors to constitute an Executive Committee. One of such
directors shall be designated as Chairman of the Executive Committee. The
Executive Committee shall have and may exercise all of the rights, powers and
authority of the Board of Directors, except as expressly limited by the Maryland
General Corporation Law as amended from time to time.
(b) The Executive Committee shall fix its own rules of procedure
and shall meet at such times and at such place or places as it may determine.
The Chairman of the Executive Committee or, in the absence of a Chairman, a
member of the Executive Committee chosen by a majority of the members present,
shall preside at meetings of the Executive Committee, and another member thereof
or such other person chosen by the Executive Committee shall act as secretary. A
majority of the Executive Committee shall constitute a quorum for the
transaction of business, and the affirmative vote of a majority of the members
present at a meeting shall be required for any action of the Executive
Committee.
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SECTION 2. OTHER COMMITTEES. The Board of Directors may appoint
such other committees as it shall deem advisable and with such authority as the
Board of Directors shall from time to time determine.
SECTION 3. OTHER PROVISIONS REGARDING COMMITTEES. (a) The Board
of Directors shall have the power at any time to fill vacancies in, change the
membership of, or discharge any committee.
(b) Members of any committee shall be entitled to such
compensation for their services as from time to time may be fixed by the Board
of Directors. No committee member who receives compensation as a member of any
one or more committees shall be barred from serving the Corporation in any other
capacity or from receiving compensation and reimbursement of reasonable expenses
for any or all such other services.
(c) Unless prohibited by law, the provisions of Section 12, 13
and 15 of Article III shall apply to all committees.
ARTICLE V
OFFICERS
SECTION 1. POSITIONS. The officers of the Corporation shall be
chosen by the Board of Directors and shall consist of a President, one or more
Vice Presidents, a Secretary and a Treasurer. The Board of Directors also may
choose one or more Assistant Secretaries and Assistant Treasurers and such other
officers and agents at the Board from time to time deems necessary or
appropriate. The Board of Directors may delegate to the President of the
Corporation the authority to appoint any officer or agent of the Corporation and
to fill a vacancy other than the President, Secretary or Treasurer. The election
or appointment of any officer of the Corporation in itself shall not create
contract rights for any such officer. All officers of the Corporation shall
exercise such powers and perform such duties as from time to time shall be
determined by the Board of Directors. Any two or more offices may be held by the
same person except the offices of President and Vice President, President and
Secretary, or President and Assistant Secretary.
SECTION 2. TERM OF OFFICE; REMOVAL. Each officer of the
Corporation shall hold office at the pleasure of the Board of Directors and any
officer may be removed, with or without cause, at any time by the affirmative
vote of a majority of the directors then in office, provided that any officer
appointed by the President pursuant to authority delegated to the President by
the Board of Directors may be removed, with or without cause, at any time
whenever the President in his or her absolute discretion shall consider that the
best interests of the Corporation shall be served by such removal. Vacancies
(however caused) in any office may be filled for the unexpired portion of the
term by the Board of Directors (or by the President in the case of a vacancy
occurring in an office to which the President has been delegated the authority
to make appointments).
SECTION 3. COMPENSATION. The salaries of all officers of the
Corporation shall be fixed from time to time by the Board of Directors, and no
officer shall be prevented from receiving a salary by reason of the fact that
such officer also receives from the Corporation compensation in any other
capacity.
SECTION 4. PRESIDENT. The President shall be the chief executive
officer of the Corporation and, subject to the direction of the Board of
Directors, shall have general charge of the business, affairs
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and property of the Corporation and general supervision over its other officers
and agents. In general, the President shall perform all duties incident to the
office of President of a stock corporation and shall see that all orders and
resolutions of the Board of Directors are carried into effect. The President
shall have the power and authority to execute all written instruments, of every
nature, on behalf of the Corporation, and shall be, ex officio, a member of all
standing committees. In the absence of the Chairman of the Board, the President
shall preside at all meetings of the Board of Directors and of the stockholders.
SECTION 5. VICE PRESIDENTS. In the absence or disability of the
President, the Vice President (or in the event there is more than one, the Vice
Presidents in order of their rank as fixed by the Board of Directors or, if not
ranked, the Vice-President designated by the Board of Directors), shall perform
the duties and exercise the powers of the President. The Vice Presidents shall
have the power and authority to execute on behalf of the Corporation all written
instruments of every nature. A Vice President also generally shall assist the
President and shall perform such other duties and have such other powers as from
time to time may be prescribed by the Board of Directors.
SECTION 6. SECRETARY. The Secretary shall perform such duties as
from time to time may be prescribed by the Board of Directors, the Chairman of
the Board or the President. The Secretary shall have custody of the seal of the
Corporation, shall have authority (as shall any Assistant Secretary) to affix
the same to any instrument requiring it, and to attest the seal by his or her
signature. The Board of Directors may give general authority to officers other
than the Secretary or any Assistant Secretary to affix the seal of the
Corporation and to attest the affixing thereof by his or her signature.
SECTION 7. ASSISTANT SECRETARY. The Assistant Secretary, if any
(or in the event there is more than one, the Assistant Secretaries in the order
designated or, in the absence of any designation, the order of their election or
appointment), in the absence or disability of the Secretary, shall perform the
duties and exercise the powers of the Secretary. An Assistant Secretary shall
perform such other duties and have such other powers as from time to time may be
prescribed by the Board of Directors.
SECTION 8. TREASURER. The Treasurer shall have the custody of the
corporate funds, securities, other similar valuable effects, and evidences of
indebtedness, shall keep full and accurate accounts of receipts and
disbursements in books belonging to the Corporation and shall deposit all moneys
and other valuable effects in the name and to the credit of the Corporation. The
Treasurer shall disburse the funds of the Corporation in such manner as may be
ordered by the Board of Directors from time to time and shall render to the
Chairman of the Board, the President and the Board of Directors, at regular
meetings of the Board or whenever any of them may so require, an account of all
transactions and of the financial condition of the Corporation.
SECTION 9. ASSISTANT TREASURER. The Assistant Treasurer, if any
(or in the event there is more than one, the Assistant Treasurers in the order
designated or, in the absence of any designation, in the order of their election
or appointment), in the absence or disability of the Treasurer, shall perform
the duties and exercise the powers of the Treasurer. An Assistant Treasurer
shall perform such other duties and have such other powers as form time to time
may be prescribed by the Board of Directors.
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ARTICLE VI
NOTICES
Except as otherwise specifically provided in these Bylaws, any
notice required or permitted to be given to any director, officer, stockholder
or committee member shall be given in writing, either personally, by telecopier
or by first-class mail with postage prepaid, in either case addressed to the
recipient at his or her address as it appears in the records of the Corporation.
Personally delivered or telecopied notices shall be deemed to be given at the
time they are delivered at the address of the named recipient as it appears in
the records of the Corporation, and mailed notices shall be deemed to be given
at the time they are deposited in the United States mail.
ARTICLE VII
GENERAL PROVISIONS
SECTION 1. REPRESENTATION OF SHARES OF OTHER CORPORATIONS. The
President or any Vice President and the Secretary or Assistant Secretary of the
Corporation shall have full power and authority to attend, act and vote at any
meeting of security holders of other corporations in which the Corporation may
hold securities, and at any such meeting shall possess and may exercise any and
all rights and powers incident to the ownership of such securities which the
Corporation possesses and has the power to exercise.
SECTION 2. DIVIDENDS. Subject to the Maryland General Corporation
Law, dividends upon the outstanding capital stock of the Corporation or other
distributions may be declared by the Board of Directors at any annual, regular
or special meeting and may be paid in cash, in property or in shares of the
Corporation's capital stock. Stockholders shall have no right to any dividend or
distribution unless and until declared by the Board of Directors.
SECTION 3. REGISTERED STOCKHOLDERS. Except as otherwise provided
by law, the Corporation shall be entitled to recognize the exclusive right of a
person who is registered on its books as the owner of shares of its capital
stock to receive dividends or other distributions (to the extent otherwise
distributable or distributed) and to vote (in the case of voting stock) as such
owner. The Corporation shall not be bound to recognize any equitable or legal
claim to or interest in such shares on the part of any other person. The
Corporation (or its transfer agent) shall not be required to send notices or
dividends to a name or address other than the name or address of the
stockholders appearing on the stock ledger maintained by the Corporation (or by
the transfer agent or registrar, if any), unless any such stockholder shall have
notified the Corporation (or the transfer agent or registrar, if any), in
writing, of another name or address at least ten (10) days prior to the mailing
of such notice or dividend. Nothing in these Bylaws shall be deemed to preclude
the Corporation from inquiring as to the actual ownership of any shares of its
capital stock, nor impose upon the Corporation or its transfer agent a duty, nor
limit their rights to inquire into adverse claims.
SECTION 4. LOST, STOLEN OR DESTROYED CERTIFICATE. The Board of
Directors may direct a new certificate to be issued in place of any certificate
theretofore issued by the Corporation which is claimed to have been lost, stolen
or destroyed, upon the making of an affidavit of that fact by the person
claiming the certificate to be lost, stolen or destroyed. When authorizing such
issue of a new certificate, the Board of Directors, in its discretion, may
require as a condition precedent to issuance that the owner of such lost, stolen
or destroyed certificate, or his or her legal representative, advertise the same
in such manner as the Board of Directors shall require and to deliver to the
Corporation a bond in such sum, or other security in such form, as the Board of
Directors may direct, as indemnity against any claim that may be made against
the Corporation with respect to the certificate claimed to have been lost,
stolen or destroyed.
12
<PAGE> 13
SECTION 5. RESERVES. The Board of Directors, in its sole
discretion, may fix a sum which may be set aside or reserved over and above the
paid-in capital of the Corporation as a reserve for any proper purpose, and from
time to time may increase, diminish or vary such reserves.
SECTION 6. FISCAL YEAR. The fiscal year of the Corporation shall
be as determined from time to time by the Board of Directors.
SECTION 7. SEAL. The corporate seal shall have inscribed thereon
the name of the Corporation, the year of its incorporation and the words
"Corporate Seal" and "State of Maryland."
SECTION 8. EXEMPTION FROM CONTROL SHARE ACQUISITION STATUTE. The
provisions of Sections 3-701 to 3-709 of the Corporations and Associations
Article of the Annotated Code of Maryland shall not apply to any shares of
common stock of the Corporation now or hereafter held of record or beneficially
held by any person whatsoever, it being the intent of this provision that the
Corporation opt out of the aforementioned sections in their entirety and that
all persons and shares of beneficial interest held by such persons be exempted
from such sections to the fullest extent permitted by Maryland law.
ARTICLE VII
AMENDMENTS
These Bylaws may be amended or repealed or new or additional
Bylaws may be adopted only by the vote or written consent of the Directors, and
the stockholders shall not have any power to amend or repeal these Bylaws or to
adopt new or additional Bylaws.
13
<PAGE> 1
EXHIBIT 4.6
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
SAVINGS AND RETIREMENT PLAN
<PAGE> 2
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.
SAVINGS AND RETIREMENT PLAN
TABLE OF CONTENTS
Page
ARTICLE 1 - TITLE..............................................................1
ARTICLE 2 - DEFINITIONS........................................................2
ARTICLE 3 - PARTICIPATION......................................................8
Section 3.1. Initial Enrollment Requirements............................8
Section 3.2. General Enrollment Requirements............................9
ARTICLE 4 - CONTRIBUTIONS......................................................9
Section 4.1. Pre-Tax Contributions......................................9
Section 4.2. Employer Match Contributions..............................13
Section 4.3. Discretionary Match Contributions.........................15
Section 4.4. Limitations on Contributions for
Highly-Compensated Employees..............................16
Section 4.5. Limitation on Employer Contributions......................24
ARTICLE 5 - ROLLOVER CONTRIBUTIONS............................................26
Section 5.1. Requirements for Rollover Contributions...................26
Section 5.2. Delivery of Rollover Contributions........................27
ARTICLE 6 - TRUST.............................................................28
ARTICLE 7 - INVESTMENT ELECTIONS AND ALLOCATION OF TRUST INCOME
AND CONTRIBUTIONS TO PARTICIPANTS' ACCOUNTS.......................29
Section 7.1. Separate Accounts.........................................29
Section 7.2. Investment Elections......................................32
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Section 7.3. Allocation to Participants' Accounts of Net Income of
Trust and Fluctuation in Value of Trust Assets............34
Section 7.4. Determination of Net Worth of an Investment Fund..........34
Section 7.5. Crediting of Contributions to Accounts....................34
Section 7.6. Limitations on Allocations................................36
Section 7.7. Correction of Error.......................................39
ARTICLE 8 - DISTRIBUTIONS AND WITHDRAWALS.....................................40
Section 8.1. Termination of Employment Under Circumstances
Entitling Participant to Full Distribution of His
Account...................................................40
Section 8.2. Termination of Employment under Circumstances
Resulting in Partial Forfeiture of the Participant's
Account...................................................40
Section 8.3. Time and Form of Distribution upon Termination
of Employment.............................................41
Section 8.4. Designation of Beneficiary................................45
Section 8.5. Investment of Distributee Accounts........................46
Section 8.6. Distributions to Minor and Disabled Distributees..........47
Section 8.7. "Lost" Participants and Beneficiaries.....................47
Section 8.8. Withdrawals from Accounts During Employment...............48
Section 8.9. Loans to Participants.....................................52
Section 8.10. Direct Rollovers..........................................54
ARTICLE 9 - SPECIAL PARTICIPATION AND DISTRIBUTION RULES
RELATING TO REEMPLOYMENT OF TERMINATED
EMPLOYEES AND EMPLOYMENT BY RELATED ENTITIES......................56
Section 9.1. Change of Employment Status...............................56
Section 9.2. Reemployment of an Eligible Employee Whose
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Employment Terminated Prior to His Becoming a
Participant...............................................56
Section 9.3. Reemployment of a Terminated Participant..................57
Section 9.4. Leased Employees..........................................58
Section 9.5. Employment by Related Entities............................59
ARTICLE 10 - PARTICIPANTS' STOCKHOLDER RIGHTS.................................59
Section 10.1. Voting Shares of Company Stock...........................59
Section 10.2. Tender Offers............................................60
ARTICLE 11 - ADMINISTRATION...................................................62
Section 11.1. The Plan Administrator...................................62
Section 11.2. Claims Procedure.........................................66
Section 11.3. Procedures for Domestic Relations Orders.................67
Section 11.4. Notices to Participants, Etc.............................69
Section 11.5. Notices to Company, Employers or Committee...............69
Section 11.6. Records..................................................70
Section 11.7. Reports of Accounting to Participants....................70
ARTICLE 12 - PARTICIPATION BY OTHER EMPLOYERS.................................70
Section 12.1. Adoption of Plan.........................................70
Section 12.2. Withdrawal from Participation............................71
Section 12.3. Company and Committee as Agent for Employers.............71
ARTICLE 13 - CONTINUANCE BY A SUCCESSOR.......................................71
ARTICLE 14 - MISCELLANEOUS....................................................73
Section 14.1. Expenses.................................................73
Section 14.2. Non-Assignability........................................73
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Section 14.3. Employment Non-Contractual...............................75
Section 14.4. Limitation of Rights.....................................75
Section 14.5. Merger or Consolidation with Another Plan................75
Section 14.6. Gender and Plurals.......................................75
Section 14.7. Applicable Law...........................................76
Section 14.8. Severability.............................................76
ARTICLE 15 - TOP-HEAVY PLAN REQUIREMENTS......................................76
Section 15.1. Top-Heavy Plan Determination.............................76
Section 15.2. Definitions and Special Rules............................77
Section 15.3. Minimum Contribution for Top-Heavy Years.................78
Section 15.4. Top-Heavy Vesting Requirements...........................79
Section 15.5. Special Rules for Applying Statutory Limitations on
Benefits.................................................80
ARTICLE 16 - AMENDMENT, ESTABLISHMENT OF SEPARATE
PLAN AND TERMINATION.............................................81
Section 16.1. Amendment or Termination.................................81
Section 16.2. Establishment of Separate Plan...........................82
Section 16.3. Full Vesting upon Termination of Participation or
Partial Termination of the Plan..........................82
Section 16.4. Distribution upon Termination of the Plan................83
Section 16.5. Trust Fund to Be Applied Exclusively for Participants
and Their Beneficiaries..................................83
APPENDIX - SPECIAL PROVISIONS FOR CERTAIN PARTICIPANTS........................85
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STARWOOD HOTELS & RESORTS
WORLDWIDE, INC.
SAVINGS AND RETIREMENT PLAN
ARTICLE 1
TITLE
The title of the Plan shall be the "Starwood Hotels & Resorts
Worldwide, Inc. Savings and Retirement Plan." The Plan was originally
established effective April 1, 1997. Effective April 1, 1999, the Westin Hotel
Company 401(k) Growth Opportunity Plan, the Investment Plan for Employees of
Westin Hotel Company, the ITT 401(k) Retirement Savings Plan and the Starwood
Hotels & Resorts StarSaver 401(k) Plan (the "Prior Plans") were merged into the
Plan, and the Plan and each such plan was amended and restated as the Starwood
Hotels & Resorts Worldwide, Inc. Savings and Retirement Plan. The Plan shall be
effective with respect to each Participant who terminates employment after March
31, 1999, provided that with respect to the Prior Plans (i) the provisions of
the Plan that reflect modifications required by the Taxpayers Relief Act of 1997
and the Small Business Job Protection Act of 1996 shall be effective January 1,
1997, (ii) the provisions of the Plan that reflect modifications required by the
Uniformed Services Employment and Reemployment Rights Act of 1994 shall be
effective December 12, 1994, and (iii) the provisions of the Plan that reflect
modifications required by the Retirement Protection Act of 1994 shall be
effective January 1, 1995. The Plan is designated as a "profit sharing plan"
within the meaning of Section 1.401-1(a)(2)(ii) of the Regulations.
The Plan is maintained by Starwood Hotels & Resorts Worldwide, Inc.
(the "Company") for the benefit of eligible employees of the Company and any of
its Affiliates (as defined in Article 2) that adopts the Plan, and by certain
Nonaffiliates (as defined in
<PAGE> 7
Article 2) for the benefit of eligible employees of such Nonaffiliates. As
adopted by the Company and its Affiliates, the Plan constitutes a single plan
(as described in Treasury Regulation Section 1.414(l)-1(b)(1)) for the exclusive
benefit of eligible employees of the Company and its adopting Affiliates, and
not for the benefit of eligible employees of adopting Nonaffiliates. As adopted
and maintained by each adopting Nonaffiliate, the Plan constitutes a single plan
(as described in Treasury Regulation Section 1.414(l)-1(b)(1)) for the exclusive
benefit of eligible employees of such Nonaffiliate, and not for the benefit of
eligible employees of the Company, any of its adopting Affiliates or any other
adopting Nonaffiliate.
The changes made by and incidental to this amendment and restatement
include the appointment of a new recordkeeper for the Plan. In order to
implement this change, during a transition period beginning on April 1, 1999 and
ending on a date determined by the Committee, investment elections, withdrawals,
loans, transfers, contribution rate changes and distributions under the Plan
will be temporarily suspended.
ARTICLE 2
DEFINITIONS
As used herein, the following words and phrases shall have the
following respective meanings when capitalized:
(1) Affiliate. (a) A corporation which is a member of the same
controlled group of corporations (within the meaning of section 414(b) of
the Code) as an Employer, (b) a trade or business (whether or not
incorporated) under common control (within the meaning of section 414(c)
of the Code) with an Employer, (c) any organization (whether or not
incorporated) which is a member of an affiliated service group (within the
meaning of section 414(m) of the Code) which includes an
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<PAGE> 8
Employer, a corporation described in clause (a) of this subdivision or a
trade or business described in clause (b) of this subdivision, or (d) any
other entity which is required to be aggregated with an Employer pursuant
to Regulations promulgated under section 414(o) of the Code.
(2) Beneficiary. The person or persons entitled under Article 8 to
receive benefits in the event of the death of a Participant.
(3) Break in Service Year. Each Plan Year during which an Employee
has not completed more than 500 Hours of Service. For purposes of
determining whether an Employee has incurred a Break in Service Year, the
Employee shall be credited with Hours of Service for any period during
which he (i) is on an uncompensated leave of absence duly granted by his
Employer, (ii) is absent from work for any period because of (A) the
Employee's pregnancy, (B) the birth of the Employee's child, (C) the
placement of a child with the Employee in connection with the Employee's
adoption of such child or (D) the need to care for any such child for a
period beginning immediately following such birth or placement or (iii) is
in Military Service, provided such Military Service does not extend beyond
the date on which the Employee could, with or without application, have
been discharged and after discharge from such Military Service the
Employee returns to the employ of the Employer within the period
prescribed by laws relating to the reemployment rights of persons in
Military Service. The number of hours to be so credited shall be
determined under uniform rules applied by the Committee in accordance with
Regulations, except that for purposes of clause (ii) above, the Employee
shall be credited with the number of Hours of Service for which the
Employee would receive credit but for such absence (or, if unknown, 8
hours for each business day of such absence), (I) in the case of an
Employee who would have incurred a Break in Service Year during the Plan
Year in which a period of absence commenced but for the application of
such clause (ii) only for such Plan Year, or (II) in the case of any other
Employee only for the Plan Year immediately following the Plan Year in
which such period of absence commenced. Notwithstanding the foregoing, no
Hours of Service shall be credited under clause (iii) above unless the
Employee returns to active employment at the end of such leave of absence
or under clause (ii) above unless the Employee timely furnishes to the
Committee such information as it may reasonably require to establish to
the satisfaction of the Committee the reason for and duration of such
absence.
(4) Code. The Internal Revenue Code of 1986, as amended.
(5) Committee. The committee appointed by the board of directors of
the Company pursuant to Section 11.1 to administer the Plan.
(6) Company. Starwood Hotels & Resorts Worldwide, Inc., a Maryland
corporation, and any successor to such corporation which adopts the Plan
pursuant to Article 12.
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<PAGE> 9
(7) Company Stock. Paired shares of common stock of the Company and
Class B shares of beneficial interest of Starwood Hotels & Resorts.
(8) Company Stock Fund. The investment fund established and
maintained in accordance with Section 7.1.
(9) Compensation. The remuneration for services provided by an
Employer to an Employee while a Participant that constitutes wages under
section 3401(a) of the Code, but excluding any amounts so reported that
are moving expenses, or income attributable to the grant, vesting or
exercise of stock options granted to the Employee by the Company or his
Employer and including any amounts which would have been so reported but
for the Participant's election to have pre-tax contributions made on his
behalf pursuant to Section 4.1 or to reduce his wages pursuant to an
arrangement described in section 125 of the Code. A Participant's
Compensation for a Plan Year in excess of $150,000 (as adjusted for
increases in the cost of living pursuant to section 401(a)(17) of the Code
and pursuant to Regulations) shall not be taken into account for any
purposes under the Plan.
(10) Distributee. A person entitled to receive a distribution from
the Trust under Article 8.
(11) Distributee Account. An account established pursuant to Section
8.5 for the benefit of a Distributee.
(12) Effective Date. With respect to the Company such date shall be
April 1, 1999, and in the case of any other Employer shall be the
effective date of such Employer's adoption of the Plan pursuant to Article
11.
(13) Eligible Employee. An Employee who is paid from a payroll
maintained in the continental United States, Hawaii, Alaska or the U. S.
Virgin Islands other than any Employee included in a unit of Employees the
terms of whose employment with an Employer are subject to the terms of a
collective bargaining agreement between employee representatives of such
unit and such Employer unless such agreement provides for such Employee to
be eligible for participation in the Plan.
(14) Employee. An individual whose relationship with an Employer is,
under common law, that of an employee. Notwithstanding the foregoing, no
individual who renders service for an Employer shall be considered an
Employee for purposes of the Plan if such Employee renders such services
pursuant to either (i) an agreement providing that such services are to be
rendered by the individual as an independent contractor or (ii) an
agreement with an entity, including a leasing organization within the
meaning of Section 414(n)(2) of the Code, that is not an Employer or an
Affiliate.
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(15) Employer. The Company, and any of its Affiliates or any
Nonaffiliate which, with the consent of the Company, elects to participate
in the Plan in the manner described in Article 12 and any successor entity
which adopts the Plan pursuant to Article 12. If any such entity withdraws
from participation in the Plan pursuant to Section 12.2, or terminates its
participation in the Plan pursuant to Section 16.4, such entity shall
thereupon cease to be an Employer.
(16) Entry Date. April 1, 1999, July 1, 1999, and the first day of
any subsequent month.
(17) ERISA. The Employee Retirement Income Security Act of 1974, as
amended.
(18) Hour of Service. An hour for which an Employee is entitled to
receive compensation from an Employer or any of its Affiliates (including
hours for any period during which he receives compensation without
rendering services such as paid holidays, vacations, sick leave,
disability leave, layoff, or jury duty, (but in such cases not exceeding
501 hours for any one such period) and any period during which the
Employee is in Military Service to the extent required by the law relating
to the reemployment and other rights of veterans). For purposes of
determining the number of Hours of Service to be credited to an Employee,
"compensation" shall mean the total earnings paid, directly or indirectly,
to the Employee by an Employer or any of its Affiliates, including any
back pay, irrespective of mitigation of damages, either awarded to the
Employee or agreed to by the Employer or any of its Affiliates. The
computation of Hours of Service and the periods to which they are to be
credited shall be determined under uniform rules applied by the Committee
in accordance with Department of Labor Regulation Section 2530.200b-2(b),
(c) and (f). Each employee for whom Hours of Service are not determinable
pursuant to the foregoing sentence shall be credited with 45 Hours of
Service for each week of employment or such other number of Hours of
Service determined by the Committee in accordance with Department of Labor
Regulation Section 2530.200b-3(e).
For purposes of determining a Participant's Hours of Service for the Plan
Year beginning January 1, 1999, each Participant who was a participant in
the Starwood Hotels & Resorts Worldwide, Inc. StarSaver 401(k) Plan, the
Starwood Hotels & Resorts StarSaver 401(k) Plan or the Westin Hotel
Company 401(k) Growth Opportunity Plan on March 31,1999 and who became a
Participant on April 1, 1999 pursuant to Section 3.1 shall be credited
with the same number of Hours of Service on April 1, 1999 under the Plan
as he or she was credited with on such date under the applicable Prior
Plan. For the period commencing on January 1, 1999 and ending on March 31,
1999, each Participant who was a participant in the ITT 401(k) Retirement
Savings Plan on March 31, 1999 and who became a Participant on April 1,
1999 pursuant to Section 3.1 shall be crediting with 45 Hours of Service
for each week of employment during such period.
Subject to Section 9.2, for purposes of determining the Hours of Service
to be credited to an Eligible Employee who satisfies the participation
requirements of the
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<PAGE> 11
Plan after April 1, 1999, each such Eligible Employee shall be credited
with the same number of Hours of Service as he or she was credited with
under the applicable Prior Plan on March 31, 1999. For purposes of the
foregoing sentence, an Eligible Employee who was credited with service
under the ITT 401(k) Retirement Savings Plan prior to April 1, 1999, shall
be credited with 45 Hours of Service for each week of employment.
(19) Military Service. Service in the "uniformed services", within
the meaning of the Uniformed Services Employment and Reemployment Rights
Act of 1994, which entitles the person rendering such service to
reemployment under such Act.
(20) Nonaffiliate. An entity, other than the Company or one of its
Affiliates, which with the consent of the Company adopts the Plan in
accordance with the provisions of Article 12.
(21) Participant. An Eligible Employee who has become a Participant
as set forth in Article 3. A person shall cease to be a Participant upon
the distribution of his vested account balances under the Plan.
(22) Plan. The Starwood Hotels & Resorts Worldwide, Inc. Savings and
Retirement Plan herein set forth, and as from time to time amended.
(23) Plan Year. Each 12-consecutive-month period beginning on each
January 1 and ending on the next December 31.
(24) Prior Plans. The Starwood Hotels & Resorts Worldwide, Inc.
StarSaver 401(k) Plan, the Starwood Hotels & Resorts StarSaver 401(k)
Plan, the Westin Hotel Company 401(k) Growth Opportunity Plan, the
Investment Plan for Employees of Westin Hotel Company and the ITT 401(k)
Retirement Savings Plan. Solely for purposes of determining an Eligible
Employee's Years of Service for vesting and eligibility, Prior Plans shall
also include the Sheraton Salaried Retirement Plan for Managed Hotels -
Cerritos, Sheraton Salaried Retirement Plan for Managed Hotels - Chicago
Hotel & Towers, Sheraton Salaried Retirement Plan for Managed Hotels -
Steamboat Springs, Sheraton Salaried Retirement Plan for Managed Hotels -
Inner Harbor, Sheraton Salaried Retirement Plan for Managed Hotels -
Sheraton Palace Hotel, Sheraton Hourly Pension Plan for Managed Hotels -
Cerritos, Sheraton Hourly Pension Plan for Managed Hotels - Steamboat
Springs and the Sheraton Hourly Pension Plan for Managed Hotels - Inner
Harbor.
(25) Prior Plan Accounts. The Prior Plan Forfeitable Accounts and
Prior Plan Nonforfeitable Accounts established for each Participant who
was an active participant in a Prior Plan on March 31, 1999 and who became
a Participant on April 1, 1999 pursuant to Section 3.1 that shall be
credited with contributions made on behalf of such Participant under such
Prior Plan.
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(26) Prior Plan Forfeitable Accounts. The Prior Plan Accounts
established for each Participant who was an active participant in a Prior
Plan on March 31, 1999 and who became a Participant on April 1, 1999
pursuant to Section 3.1 that are subject to the vesting provisions
contained in Section 8.2. Prior Plan Forfeitable Accounts include a
Participant's prior Starwood match account, Westin match account, Westin
RAP account and ITT match account (as applicable) established pursuant to
Section 7.1(b).
(27) Prior Plan Nonforfeitable Accounts. The Prior Plan Accounts
established for each Participant who was an active participant in a Prior
Plan on March 31, 1999 and who became a Participant on April 1, 1999
pursuant to Section 3.1 that are nonforfeitable. Prior Plan Nonforfeitable
Accounts include a Participant's prior plan basic account, ITT post-86
after-tax account, ITT pre-87 after-tax account, ITT prior plan monies
account, ITT pre-tax account and ITT rollover account (as applicable)
established pursuant to Section 7.1(b).
(28) Regulations. Written promulgations of the Department of Labor
construing Title I of ERISA or of the Internal Revenue Service construing
the Code.
(29) Total and Permanent Disability. The inability of a Participant
to engage in any substantial gainful activity by reason of any medically
determinable physical or mental impairment that can be expected to result
in death or which has lasted or can be expected to last for a continuous
period of not less than 12 months. The permanence and degree of such
impairment shall be supported by medical evidence.
(30) Trust. The Starwood Hotels & Resorts Worldwide, Inc. Savings
and Retirement Trust, as from time to time amended.
(31) Trustee. The Trustee provided for in Article 6 or any successor
Trustee or, if there shall be more than one Trustee acting at any time,
all of such Trustees collectively.
(32) Trust Fund. All money and property of every kind held by the
Trustee under the Trust agreement.
(33) Valuation Date. Each day that the New York Stock Exchange is
open, and any other day as the Committee may determine.
(34) Years of Service. Except as provided otherwise in the Appendix,
for purposes of determining eligibility (i) the 12-consecutive-month
period commencing on the date on which an Employee first performs an Hour
of Service for an Employer or any of its Affiliates or (ii) any Plan Year
commencing after the date an Employee first performs an Hour of Service
for an Employer or any of its Affiliates during which the Employee
completes 1,000 or more Hours of Service; and for purposes of determining
vesting service, any Plan Year during which an Employee completes 1,000 or
more Hours of Service. Under the Plan as adopted
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<PAGE> 13
by the Company and its adopting Affiliates, Years of Service performed for
(i) a Nonaffiliate shall be considered for purposes of participation and
(ii) a Nonaffiliate participating in a Prior Plan on March 31, 1999 shall
also be considered for purposes of vesting. Under the Plan as adopted by a
Nonaffiliate with the consent of the Company, Years of Service performed
for (i) the Company, any of its adopting Affiliates or another
Nonaffiliate shall be considered for purposes of participation and (ii)
the Company, any of its adopting Affiliates or another Nonaffiliate
participating in a Prior Plan on March 31, 1999 shall be considered for
purposes of vesting.
Each Participant who was a participant in a Prior Plan on March 31, 1999
and who became a Participant on April 1, 1999 pursuant to Section 3.1
shall be credited with the same number of whole Years of Service on April
1, 1999 under the Plan as he or she was credited with on such date under
the applicable Prior Plan. For purposes of vesting, each Participant who
was a participant in the Starwood Hotels & Resorts Worldwide, Inc.
StarSaver 401(k) Plan or the Starwood Hotels & Resorts StarSaver 401(k)
Plan on March 31, 1999 and who became a Participant on April 1, 1999
pursuant to Section 3.1, shall be credited with a Year of Service for both
(i) the 12-consecutive month period beginning on the anniversary of his
date of employment with an employer under the Prior Plan that most
immediately precedes January 1, 1999, provided that such Participant is
credited with 1,000 Hours of Service during such 12-consecutive-month
period and (ii) the Plan Year commencing on January 1, 1999, provided that
such Participant is credited with 1,000 Hours of Service during such Plan
Year.
ARTICLE 3
PARTICIPATION
Section 3.1.Initial Enrollment Requirements. Each Eligible Employee
employed by an Employer on April 1, 1999 and who was an active participant in
any of the Prior Plans on March 31, 1999 shall become a Participant as of April
1, 1999. Each Eligible Employee employed by an Employer on April 1, 1999 and who
was not an active participant in a Prior Plan on March 31, 1999 shall become a
Participant as of April 1, 1999 pursuant to Section 4.1(b).
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<PAGE> 14
Section 3.2.General Enrollment Requirements. Each Eligible Employee
employed by an Employer who has (i) completed a Year of Service and (ii)
attained age 21 is eligible to become a Participant as soon as administratively
practicable as of any Entry Date after such service requirement is satisfied and
such age is attained.
ARTICLE 4
CONTRIBUTIONS
Section 4.1. Pre-Tax Contributions. (a) Making pre-tax
contributions. Subject to the limitations set forth in paragraph (e) of this
Section, and subject to the limitations set forth in Sections 4.4, 4.5 and 7.6,
each Employer shall make a pre-tax contribution for each payroll period on
behalf of each Participant who is an Eligible Employee of such Employer in an
amount ("pre-tax contribution") equal to a whole percentage elected or deemed
elected by such Participant pursuant to paragraph (b), (c) or (d) of this
Section from 1% to 18% of such Participant's Compensation paid by such Employer
for such payroll period. The Committee may decide from time to time that a
percentage lower than 18% shall be substituted for the percentage of 18% set
forth in the preceding sentence. The amount of the Participant's compensation
otherwise payable for a payroll period for which any such contribution is to be
made shall be reduced by means of payroll reduction by the amount of such
contribution.
(b) Election of pre-tax contributions. An Eligible Employee who
satisfies the participation requirements of Article 3 on or after April 1, 1999
in accordance with Section 3.2 shall be deemed to have elected to become a
Participant and to have pre-tax
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contributions made on his behalf at a rate equal to 2% of his Compensation,
effective as soon as administratively practicable coincident with or next
following his satisfaction of the participation requirements of Article 3,
unless the Eligible Employee elects otherwise prior to his satisfaction of such
requirements in the time and manner prescribed by the Committee. Notwithstanding
the foregoing, effective as of April 1, 1999, any Eligible Employee who
satisfies the participation requirements of Article 3 on April 1, 1999 in
accordance with Section 3.1 and who was an active participant in a Prior Plan on
March 31, 1999 shall be deemed to have elected to become a Participant and to
have pre-tax contributions made on his behalf at a rate equal to his pre-tax
contribution rate under the applicable Prior Plan, unless the Eligible Employee
elects otherwise prior to April 1, 1999 in the time and manner prescribed by the
Committee. Any election or deemed election to commence pre-tax contributions
shall be effective only with respect to Compensation not yet paid as of the
effective date of such election. Pre-tax contributions shall continue in effect
at 2% or the rate otherwise elected by the Participant until the Participant
suspends or changes such election as provided in paragraphs (c) and (d) of this
Section.
(c) Suspension of pre-tax contributions. A Participant may suspend
pre-tax contributions effective as of the first day of any payroll period by
giving directions to the Committee in accordance with rules and procedures
prescribed by the Committee.
(d) Change or resumption in the rate of pre-tax contributions. A
Participant may change, and a Participant who has suspended pre-tax
contributions may resume, the rate of pre-tax contributions effective as soon as
administratively practicable by giving directions to the Committee in accordance
with rules and procedures prescribed by the
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<PAGE> 16
Committee. Any such change or resumption in the rate of pre-tax contributions
shall be limited to those rates and subject to the rules described in paragraphs
(a) and (b) of this Section.
(e) Annual limit on pre-tax contributions. (1) The limit. The
provisions of this Section shall apply separately to (i) the Plan as adopted by
the Company and its Affiliates and (ii) the Plan as adopted by each
Nonaffiliate. For purposes of this Section, a Participant's pre-tax
contributions for the calendar year beginning January 1, 1999 shall include any
such contributions made to a Prior Plan with respect to the period beginning
January 1, 1999 and ending March 31, 1999. Notwithstanding the provisions of
this Section, a Participant's pre-tax contributions for any calendar year shall
not, together with amounts contributed under all other plans and arrangements
maintained by his Employer or its Affiliates and described in section 401(k),
section 408(k) or section 403(b) of the Code, exceed $9,500 (as adjusted for
cost-of-living increases in accordance with section 402(g)(5) of the Code).
(2) Distribution of excess pre-tax contributions. If for any
calendar year during which a Participant also participates in a plan or
arrangement described in section 401(k), section 408(k) or section 403(b) of the
Code maintained by another employer the aggregate for the Participant of the (i)
pre-tax contributions to the Plan and (ii) amounts contributed under all other
such plans and arrangements will exceed the above limit for the calendar year in
which such contributions are made ("excess pre-tax contributions"), such
Participant shall, pursuant to such rules and at such time following such
calendar year as determined by the Committee, be allowed to submit a written
request that the excess pre-
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<PAGE> 17
tax contributions plus any income allocable thereto be distributed to him. Such
request shall be accompanied by the Participant's written statement that if such
excess pre-tax contributions are not distributed such excess pre-tax
contributions, when added to amounts contributed under other plans and
arrangements described in section 401(k), section 408(k) or section 403(b) of
the Code will exceed the limit described in the first sentence of this
paragraph. A distribution of such excess pre-tax contributions plus allocable
income shall be made no later than the April 15 of the calendar year following
the calendar year in which such excess pre-tax contributions were made. The
amount of excess pre-tax contributions to be so distributed shall be reduced by
any contributions previously distributed pursuant to Section 4.4 with respect to
such calendar year. The amount of any income allocable to such excess pre-tax
contributions shall be determined by the Committee pursuant to Regulations.
Notwithstanding the provisions of this paragraph, any excess pre-tax
contributions shall be treated as "annual additions" for purposes of Section
7.6. Any corresponding "Employer match contributions" (described in Section 4.2)
or "discretionary match contributions" (described in Section 4.3) related to
excess pre-tax contributions so distributed, plus any income allocable to such
Employer match contributions or discretionary match contributions, shall be
forfeited.
(f) Military Service. Notwithstanding any provision of the Plan to
the contrary, pre-tax contributions will be permitted for periods of Military
Service (and any corresponding Employer match contributions described in Section
4.2 and discretionary match contributions described in Section 4.3 will be made)
upon the Participant's reemployment by an Employer after such Military Service
to the extent required by the
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<PAGE> 18
Uniformed Services Employment and Reemployment Rights Act of 1994 and in
accordance with Section 414(u) of the Code.
Section 4.2.Employer Match Contributions. (a) Subject to the
limitations set forth in Sections 4.4, 4.5 and 7.6, each Employer shall
contribute for each Participant for whom such Employer makes pre-tax
contributions an amount ("Employer match contribution") equal to 100% of such
pre-tax contributions made on behalf of such Participant up to the first 2% of
Compensation and 50% of such pre-tax contributions made on the behalf of such
Participant for the next 2% of Compensation. Pre-tax contributions made on
behalf of a Participant for any payroll period which exceed 4% of the
Participant's Compensation for such payroll period shall not be considered for
purposes of this paragraph. Such Employer match contributions made pursuant to
this paragraph shall be delivered to the Trustee by the last day of the month
following the month in which the Compensation on which the corresponding pre-tax
contribution is based is paid to the Participant.
(b) Subject to the limitations set forth in Sections 4.4, 4.5 and
7.6, each Employer shall also make a supplemental Employer match contribution
for each Participant who is an Eligible Employee of such Employer on the last
day of such Plan Year and for whom an Employer made pre-tax contributions for
any payroll period during such Plan Year in excess of 4% of the Participant's
Compensation for such payroll period an amount equal to the difference between
(i) 100% of the pre-tax contributions made on behalf of such Participant up to
the first 2% of the Participant's total Compensation for such Plan Year and 50%
of pre-tax contributions made on the behalf of such Participant for the next 2%
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<PAGE> 19
of the Participant's total Compensation for such Plan Year and (ii) the amount
of Employer match contributions contributed for the Participant under paragraph
(a) above with respect to payroll periods ending in such Plan Year. Employer
match contributions made pursuant to this paragraph shall be delivered to the
Trustee prior to the due date, including extensions thereof, of the Employer's
federal income tax return for the taxable year of the Employer with or within
which such Plan Year ends.
(c) Any amounts required to be contributed as Employer match
contributions pursuant to paragraph (a) and paragraph (b) above shall be reduced
by any amounts forfeited pursuant to Section 4.1(e), Section 4.4(e) and Section
8.2 with respect to such Plan Year and such forfeited amounts shall be for all
purposes be treated as amounts that would otherwise be contributed as Employer
match contributions.
(d) Notwithstanding any provision of the Plan to the contrary,
Employer match contributions will be made for each Participant on whose behalf
pre-tax contributions are made pursuant to Section 4.1(f). Such Employer match
contributions will also be made as required by the Uniformed Services Employment
and Reemployment Rights Act of 1994 and in accordance with Section 414(u) of the
Code.
Section 4.3. Discretionary Match Contributions. Subject to the
limitations set forth in Sections 4.4, 4.5 and 7.6, each Employer may contribute
for each Plan Year for each Participant employed by the Employer on the last day
of the Plan Year who has elected to make pre-tax contributions in accordance
with Section 4.1 and who was credited with 1,000 Hours of Service in that Plan
Year an amount equal to such percentage of the
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pre-tax contributions made by such Participant as is determined by the Employer
in its discretion ("discretionary match contribution"); provided, however, that
the percentage determined by an Employer for any Participant shall be the same
percentage as determined by the Employer for all other Participants employed at
the same facility by that Employer for such Plan Year. An Employer's
discretionary match contribution for any Plan Year shall be delivered to the
Trustee prior to the due date, including extensions thereof, of the Employer's
federal income tax return for the taxable year of the Employer with or within
which such Plan Year ends.
Notwithstanding any provision of the Plan to the contrary, upon
reemployment by an Employer of a Participant who did not receive an allocation
of a discretionary match contribution made with respect to a prior Plan Year
solely because the Participant was in Military Service and on whose behalf
pre-tax contributions are made pursuant to Section 4.1(f), discretionary match
contributions will be made by such Participant's Employer for such periods of
Military Service to the extent required by the Uniformed Services Employment and
Reemployment Rights Act of 1994 and in accordance with Section 414(u) of the
Code.
Section 4.4. Limitations on Contributions for Highly-Compensated
Employees. (a) Limits imposed by section 401(k)(3) of the Code. The provisions
of this Section shall apply separately to (i) the Plan as adopted by the Company
and its Affiliates and (ii) the Plan as adopted by each Nonaffiliate.
Notwithstanding the provisions of Section 4.1(a), if the pre-tax contributions
made for a Plan Year fail to satisfy both of the tests set forth in
subparagraphs (1) and (2) of this paragraph, the adjustments prescribed
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in Section 4.1(e)(1) shall be made. For purposes of this Section, a
Participant's pre-tax contributions for any period prior to April 1, 1999 shall
include any such contributions made to a Prior Plan with respect to such period.
(1) The average deferral percentage for the group consisting of all
highly compensated Eligible Employees for the Plan Year does not exceed
the product of the average deferral percentage for the group consisting of
all non-highly compensated Eligible Employees for the immediately
preceding Plan Year and 1.25.
(2) The average deferral percentage for the group consisting of all
highly compensated Eligible Employees for the Plan Year (i) does not
exceed the average deferral percentage of the group consisting of all
non-highly compensated Eligible Employees for the immediately preceding
Plan Year by more than 2 percentage points, and (ii) does not exceed the
product of the average deferral percentage of the group consisting of all
non-highly compensated Eligible Employees for the immediately preceding
Plan Year and 2.0.
(b) Limits imposed by section 401(m) of the Code. The provisions of
this Section shall apply separately to (i) the Plan as adopted by the Company
and its Affiliates and (ii) the Plan as adopted by each Nonaffiliate.
Notwithstanding the provisions of Sections 4.2 and 4.3, if the aggregate of the
Employer match contributions and discretionary match contributions made for a
Plan Year fail to satisfy both of the tests set forth in subparagraphs (1) and
(2) of this paragraph, the adjustments prescribed in Section 4.4(e)(2) shall be
made. For purposes of this Section, a Participant's Employer match contributions
and discretionary match contributions for any period prior to April 1, 1999
shall include any contributions subject to the limits imposed by section 401(m)
of the Code made to a Prior Plan with respect to such period.
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<PAGE> 22
(1) The average contribution percentage for the group consisting of
all highly compensated Eligible Employees for the Plan Year does not
exceed the product of the average contribution percentage for the group
consisting of all non-highly compensated Eligible Employees for the
immediately preceding Plan Year and 1.25.
(2) The average contribution percentage for the group consisting of
all highly compensated Eligible Employees for the Plan Year (i) does not
exceed the average contribution percentage of the group consisting of all
non-highly compensated Eligible Employees for the immediately preceding
Plan Year by more than 2 percentage points, and (ii) does not exceed the
product of the average contribution percentage of the group consisting of
all non-highly compensated Eligible Employees for the immediately
preceding Plan Year and 2.0.
(c) Aggregate limit on contributions. Notwithstanding anything
herein to the contrary, if the aggregate of the pre-tax contributions, Employer
match contributions and discretionary match contributions made for a Plan Year
fail to satisfy all of the tests set forth in subparagraphs (1), (2) and (3) of
this paragraph, the adjustments prescribed in Section 4.4(e)(3) shall be made.
(1) The average deferral percentage for the group consisting of
highly compensated Eligible Employees for the Plan Year does not exceed
the product of the average deferral percentage for the group consisting of
all non-highly compensated Eligible Employees for the immediately
preceding Plan Year and 1.25.
(2) The average contribution percentage for the group consisting of
highly compensated Eligible Employees for the Plan Year does not exceed
the product of the average contribution percentage for the group
consisting of all non-highly compensated Eligible Employees for the
immediately preceding Plan Year and 1.25.
(3) The sum of the average deferral percentage (as determined under
Section 4.4(d)(1) after making the adjustments required by Section
4.4(e)(1) for the Plan Year) and the average contribution percentage (as
determined under Section 4.4(d)(2) after making the adjustments required
by Section 4.4(e)(2) for the Plan Year) for the group consisting of highly
compensated
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<PAGE> 23
Eligible Employees for the Plan Year does not exceed the aggregate limit
for such Plan Year.
(d) Definitions and Special Rules. For purposes of this Section:
(1) The "average deferral percentage" for
(i) the group of highly compensated Eligible Employees for a
Plan Year shall be the average of the ratios, calculated separately
for each Eligible Employee in such group to the nearest
one-hundredth of one percent, of the pre-tax contributions made for
the benefit of such Eligible Employee to the total compensation for
such Plan Year paid to such Eligible Employee, and
(ii) the group of non-highly compensated Eligible Employees
for the immediately preceding Plan Year shall be the average of the
ratios, calculated separately for each Eligible Employee in such
group to the nearest one-hundredth of one percent, of the pre-tax
compensation contributions made for the benefit of such Eligible
Employee for the immediately preceding Plan Year to the total
compensation for the immediately preceding Plan Year paid to such
Eligible Employee.
(2) The "average contribution percentage" for
(i) the group of highly compensated Eligible Employees for a
Plan Year shall be the average of the ratios, calculated separately
for each Eligible Employee in such group to the nearest
one-hundredth of one percent, of the Employer match contributions,
the discretionary match contributions and, in the Committee's sole
discretion, to the extent permitted under rules prescribed by the
Secretary of the Treasury or otherwise under the law, the pre-tax
contributions made during such year for the benefit of such Eligible
Employee to such Eligible Employee's compensation for such Plan
Year, and
(ii) the group of non-highly compensated Eligible Employees
for the immediately preceding Plan Year shall be the average of the
ratios, calculated separately for each Eligible Employee in such
group to the nearest one-hundredth of one percent, of the Employer
matching contributions, discretionary match contributions and, in
the Committee's sole discretion, to the extent permitted under rules
prescribed by the Secretary of the Treasury or otherwise under the
law, the pre-tax contributions made during the immediately preceding
Plan Year for the benefit of such Eligible Employee to such Eligible
Employee's compensation for the immediately preceding Plan Year.
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<PAGE> 24
(3) the "aggregate limit" shall equal the greater of (A) the sum of
(i) 1.25 times the greater of the average deferral percentage or the
average contribution percentage for the immediately preceding Plan Year
for the group consisting of non-highly compensated Eligible Employees for
such immediately preceding Plan Year, plus (ii) the lesser of (a) the sum
of two percentage points and the lesser of the average deferral percentage
or the average contribution percentage for the immediately preceding Plan
Year for the group consisting of all non-highly compensated Eligible
Employees for such immediately preceding Plan Year, and (b) 200% of the
lesser of the average deferral percentage or the average contribution
percentage for the immediately preceding Plan Year for the group
consisting of all non-highly compensated Eligible Employees' for such
immediately preceding Plan Year or (B) the sum of (i) 1.25 times the
lesser of the average deferral percentage or the average contribution
percentage for the immediately preceding Plan Year for the group
consisting of all non-highly compensated Eligible Employees for such
immediately preceding Plan Year, plus (ii) the lesser of (a) the sum of
two percentage points plus the greater of the average deferral percentage
or the average contribution percentage for the immediately preceding Plan
Year for the group consisting of all non-highly compensated Eligible
Employees for such immediately preceding Plan Year, and (b) 200% of the
greater of the average deferral percentage and the average contribution
percentage for the immediately preceding Plan Year for the group
consisting of all non-highly compensated Eligible Employees for such
immediately preceding Plan Year;
(4) "highly compensated Eligible Employee" shall mean any Eligible
Employee who has become a Participant who performs services in the
determination year and is in one or more of the following groups: (i)
Employees who were five percent owners as determined in section
416(i)(1)(A)(iii) of the Code at any time during the determination year or
the look-back year, or (ii) Employees with compensation greater than
$80,000 (adjusted for increases in the cost of living as set forth in
section 415(d) of the Code) during the look-back year and who were in the
top-paid group during the look-back year. Any former Employee who had a
separation year prior to the determination year and was a highly
compensated Eligible Employee as described in any of clauses (i) and (ii)
above for either (A) his separation year or (B) any determination year
ending on or after this attainment of age 55 shall be considered a "highly
compensated Eligible Employee". The determination of who is a highly
compensated Eligible Employee shall be made separately for the employees
of (i) the Company and its adopting Affiliates and (ii) each adopting
Nonaffiliate. For purposes of determining whether a person is a highly
compensated Eligible Employee of an Employer with respect to a Plan Year,
the term "determination year" means the Plan Year for which the
determination is being made; the term "look-back year" means the
twelve-month period immediately preceding the determination year; the term
"top-paid group" means the top 20% of employees of the Employer ranked on
the basis of compensation received during the year (provided, however,
that when determining the number of employees in such group, employees
described in Section 414(q)(8) of the Code and Q&A 9(b) of Treasury
Regulation Section 1.414(q)-1T are excluded); "compensation" means
compensation within the meaning of section 415(c)(3) of the Code,
including
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<PAGE> 25
elective or salary reduction contributions to a cafeteria plan, cash or
deferred arrangement or tax-sheltered annuity; Employers aggregated under
section 414(b), (c), (m) or (o) of the Code are treated as a single
Employer; and "separation year" means the determination year the Employee
separates from service with the Employer.
(5) "non-highly compensated Eligible Employee" shall mean any
Eligible Employee who has become a Participant who performs services in
the determination year (as defined in subparagraph (4) of this paragraph)
and is not a highly-compensated Eligible Employee. The determination of
who is a non-highly compensated Eligible Employee shall be made separately
for the employees of (i) the Company and its adopting Affiliates and (ii)
each adopting Nonaffiliate;
(6) "compensation" shall have the meaning set forth in section
414(s) of the Code or, in the discretion of the Committee, any other
meaning in accordance with the Code for these purposes;
(7) if the Plan and one or more other plans of an Employer or any of
its Affiliates to which pre-tax contributions, Employer match
contributions or discretionary match contributions (as such terms are
defined for purposes of section 401(m) of the Code), or qualified
nonelective contributions (as such term is defined in section 401(m)(4)(C)
of the Code), are made are treated as one plan for purposes of section
410(b) of the Code, such plans shall be treated as one plan for purposes
of this Section. If a highly compensated Eligible Employee participates in
the Plan and one or more other plans of his Employer or any of its
Affiliates to which any such contributions are made, all such
contributions shall be aggregated for purposes of this Section.
(e) Adjustments to comply with limits. (1) Adjustments to comply
with section 401(k)(3) of the Code. The provisions of this Section shall apply
separately to (i) the Plan as adopted by the Company and its Affiliates and (ii)
the Plan as adopted by each Nonaffiliate. The Committee shall cause to be made
such periodic computations as it shall deem necessary or appropriate to
determine whether either of the tests set forth in Sections 4.4(a)(1) or
4.4(a)(2) shall be satisfied during a Plan Year and, if it appears to the
Committee that neither of such tests will be satisfied, the Committee shall take
such steps as it deems necessary or appropriate to adjust the pre-tax
contributions made for all or a portion of the remainder of such Plan Year on
behalf of each Participant who is a highly compensated Eligible Employee to the
extent necessary in order for one of such tests to
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<PAGE> 26
be satisfied. If after the end of a Plan Year it is determined that regardless
of any such steps taken neither of the tests set forth in Sections 4.4(a)(1) or
4.4(a)(2) shall be satisfied with respect to such Plan Year, the Committee shall
calculate a total amount by which pre-tax contributions must be reduced in order
to satisfy either such test, in the manner prescribed by Section 401(k)(8)(B) of
the Code (the "excess contributions amount"). The amount to be returned to each
Participant who is a highly compensated Eligible Employee shall be determined by
first reducing the pre-tax contributions of each Participant whose actual dollar
amount of pre-tax contributions for such Plan Year is the highest until such
reduced dollar amount equals the next highest actual dollar amount of pre-tax
contributions made for such Plan Year on behalf of any highly compensated
Participant or until the total reduction equals the excess contributions amount.
If further reductions are necessary, then such contributions on behalf of each
Participant who is a highly compensated Eligible Employee and whose actual
dollar amount of pre-tax contributions made for such Plan Year is the highest
(determined after the reduction described in the previous sentence) shall be
reduced in accordance with the previous sentence. Such reductions shall continue
to be made to the extent necessary so that the total reduction equals the excess
contributions amount. The Committee shall distribute to each such Participant no
later than the last day of the subsequent Plan Year for which such adjustment is
made (I) the amount of such reductions made with respect to such Participant
plus any income allocable thereto and (II) any corresponding Employer match
contributions related thereto plus any income allocable thereto to which such
Participant would be entitled under Section 8.1 or 8.2 if such Participant had
terminated service on the last day of the Plan Year for which such contributions
are made (or earlier if such Participant actually terminates service at any
earlier date), and any remaining amount of such corresponding Employer match
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contributions plus any income allocable thereto shall be forfeited. The amount
of pre-tax contributions distributed shall be reduced by any pre-tax
contributions previously distributed to such Participant pursuant to Section
4.1(e)(2) for such Plan Year. The amount of any income allocable to any such
reductions to be so distributed or forfeited shall be determined pursuant to
Regulations. The unadjusted amount of any reductions distributed shall be
treated as "annual additions" for purposes of Section 7.6.
(2) Adjustments to comply with section 401(m) of the Code. The
provisions of this Section shall apply separately to (i) the Plan as adopted by
the Company and its Affiliates and (ii) the Plan as adopted by each
Nonaffiliate. The Committee shall cause to be made such periodic computations as
it shall deem necessary or appropriate to determine whether either of the tests
set forth in Sections 4.4(b)(1) or 4.4(b)(2) shall be satisfied during a Plan
Year with respect to the Plan, and if it appears to the Committee that neither
of such tests will be satisfied, the Committee shall take such steps as it deems
necessary or appropriate to adjust the Employer match contributions and the
discretionary match contributions made for all or a portion of the remainder of
such Plan Year on behalf of each Participant who is a highly compensated
Eligible Employee to the extent necessary in order for one of such tests to be
satisfied. If after the end of a Plan Year it is determined that regardless of
any steps taken neither of the tests set forth in Sections 4.4(b)(1) or
4.4(b)(2) shall be satisfied with respect to such Plan Year, the Committee shall
calculate the maximum contribution percentage permissible for Participants who
are highly compensated Eligible Employees under the tests set forth in Sections
4.4(b)(1) and 4.4(b)(2) and reduce the Employer match contributions and
discretionary match contributions made on behalf of each Participant who is a
highly compensated Eligible
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<PAGE> 28
Employee and whose actual dollar amount of Employer match contributions and
discretionary match contributions for such Plan Year is the highest in the same
manner described in subparagraph (1) of this paragraph to the extent necessary
to comply with Section 4.4(b)(1) or 4.4(b)(2). The reduction described in the
foregoing sentence shall be made first with respect to a Participant's
discretionary match contributions, followed by the Participant's Employer match
contributions. The Committee shall distribute no later than the last day of the
subsequent Plan Year to each such Participant the amount of such reductions made
with respect to Employer match contributions and discretionary match
contributions plus any income allocable thereto to which such Participant would
be entitled under Section 8.1 or Section 8.2 if such Participant had terminated
service on the last day of the Plan Year for which such contributions are made
(or earlier if such Participant actually terminates service at any earlier
date), and any remaining amount of such reductions plus any income allocable
thereto shall be forfeited. The amount of any such income allocable to any such
reductions to be so distributed or forfeited shall be determined pursuant to
Regulations.
(3) Adjustments to comply with the aggregate limit. The provisions
of this Section shall apply separately to (i) the Plan as adopted by the Company
and its Affiliates and (ii) the Plan as adopted by each Nonaffiliate. If after
making the adjustments required by subparagraphs (1) and (2) of this paragraph
for a Plan Year the Committee determines that the sum of the average deferral
percentage and the average contribution percentage for the group consisting of
Participants who are highly compensated Eligible Employees exceeds the aggregate
limit for such Plan Year, the Committee shall no later than the last day of the
subsequent Plan Year reduce the pre-tax contributions made for such Plan Year
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<PAGE> 29
on behalf of each Participant who is a highly compensated Eligible Employee and
any corresponding discretionary match contributions and any Employer match
contributions (in that order) to the extent necessary to eliminate such excess.
Such reduction shall be effected in the same manner described in subparagraph
(1) of this paragraph.
Section 4.5. Limitation on Employer Contributions. The pre-tax
contributions, Employer match contributions and discretionary match
contributions of an Employer for any Plan Year shall not exceed the maximum
amount for which a deduction is allowable to such Employer for federal income
tax purposes for the taxable year of such Employer with or within which such
Plan Year ends. If the amount which an Employer would otherwise be required to
contribute is limited by the preceding sentence, the amount of the pre-tax
contributions by such Employer otherwise required by Section 4.1, after giving
effect to any limitation or refund required by Section 4.1 or 4.4, shall be
reduced by a like amount, together with any corresponding Employer match
contributions and discretionary match contributions. The amount of any such
reduction to pre-tax contributions shall be applied ratable in reduction of the
amount otherwise required by Section 4.1 to be contributed for such Plan Year on
behalf of each Participant. The amount of any reduction applicable to a
contribution otherwise made on behalf of a Participant under Section 4.1 shall
be paid to such Participant.
Any contribution made by an Employer by reason of a good faith
mistake of fact, or the portion of any contribution made by an Employer which
exceeds the maximum amount for which a deduction is allowable to such Employer
for federal income tax purposes by reason of a good faith mistake in determining
the maximum allowable
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<PAGE> 30
deduction, shall upon the request of such Employer be returned by the Trustee to
the Employer, and, if any such contribution was a pre-tax contribution, the
amount thereof shall be paid by the Employer to the Participant on whose behalf
such contribution was made and included in such Participant's compensation for
federal income tax purposes for the year of such payment. An Employer's request
and the return of any contribution must be made within one year after such
contribution was mistakenly made or after the deduction of such excess portion
of such contribution was disallowed, as the case may be. The amount to be
returned to an Employer pursuant to this paragraph shall be the excess of (i)
the amount contributed over (ii) the amount that would have been contributed had
there not been a mistake of fact or a mistake in determining the maximum
allowable deduction. Earnings attributable to the mistaken contribution shall
not be returned to the Employer but losses attributable thereto shall reduce the
amount to be so returned. If the return to an Employer of the amount
attributable to the mistaken contribution would cause the balance of any
Participant's account as of the date such amount is to be returned (determined
as if such date coincided with the close of a Plan Year) to be reduced to less
than what would have been the balance of such account as of such date had the
mistaken amount not been contributed, the amount to be returned to the Employer
shall be limited so as to avoid such reduction.
ARTICLE 5
ROLLOVER CONTRIBUTIONS
Section 5.1. Requirements for Rollover Contributions. If an Eligible
Employee receives either before or after becoming a Participant a distribution
or
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distributions from an employees' trust described in section 401(a) of the Code
which is exempt from tax under section 501(a) of the Code or from a qualified
annuity plan described in section 403(a) of the Code (or elects to directly
transfer to the Plan such distribution) and such distribution or distributions
were eligible rollover distributions as defined in section 402(c)(4) of the
Code, then such Employee may contribute to the Plan an amount which does not
exceed the amount of such distribution or distributions (including the proceeds
from the sale of any property received as a part of such distribution or
distributions) less the amount considered contributed to such trust or annuity
plan by the Employee (determined by applying section 402(d)(4)(D)(i) of the
Code) (a "rollover contribution"). A rollover contribution may also be a
distribution from an individual retirement account or individual retirement
annuity (within the meaning of section 408 of the Code); provided that no amount
in such account or no value of such annuity is attributable to a source other
than an eligible rollover distribution (within the meaning of section 402(c)(4)
of the Code) from an employees' trust described in section 401(a) of the Code
which is exempt from tax under section 501(a) of the Code or a qualified annuity
plan described in section 403(a) of the Code at the time contributions were made
on his behalf under such trust or annuity plan (and any earnings on such a
rollover distribution) and the entire amount received is paid (for the benefit
of such individual) into the Trust no later than the 60th day following the day
on which the individual receives the distribution. If a rollover contribution is
made by an Eligible Employee prior to his becoming a Participant, such Eligible
Employee shall until such time as he becomes a Participant be deemed to be a
Participant and his rollover account shall be deemed to be an account of a
Participant for all purposes of the Plan except for the purpose of being
eligible for match contributions or
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discretionary match contributions made by his Employer and for the purpose of
making pre-tax contributions.
Section 5.2. Delivery of Rollover Contributions. Any rollover
contribution made pursuant to paragraph (a) of this Section shall be delivered
by the Eligible Employee to the Committee and by the Committee to the Trustee on
or before the 60th day after the day on which the Employee receives the
distribution or on or before such later date as may be prescribed by law. Any
such contribution must be accompanied by (i) a statement of the Employee that to
the best of his knowledge the contribution meets the conditions specified in
paragraph (a) of this Section and (ii) a copy of such documents as may have been
received by the Employee advising him of the amount of and the character of such
distribution. Notwithstanding the foregoing, the Committee shall not accept a
rollover contribution if in its judgment accepting such contribution would cause
the Plan to violate any provision of ERISA, the Code or Regulations, and the
Committee shall not be required to accept such a contribution to the extent it
consists of property other than cash.
ARTICLE 6
TRUST
A Trust shall be created by the execution of a Trust agreement
between the Company and the Trustee. The Trust shall constitute a group trust
pursuant to Revenue Ruling 81-100 and all contributions under the Plan shall be
paid to the Trustee. The Trustee shall hold all monies and other property
received by it and invest and reinvest the same, together with the income
therefrom, on behalf of the Participants collectively in
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accordance with the provisions of the Trust agreement, except to the extent that
such monies and other property are invested as provided for in Article 7. The
Trustee shall make distributions from the Trust Fund at such time or times to
such person or persons and in such amounts as the Committee shall direct in
accordance with the Plan.
ARTICLE 7
INVESTMENT ELECTIONS AND
ALLOCATION OF TRUST INCOME AND
CONTRIBUTIONS TO PARTICIPANTS' ACCOUNTS
Section 7.1. Separate Accounts. (a) In General. The Committee shall
maintain or cause to be maintained separate accounts for each Participant. The
accounts maintained for a Participant shall consist of (i) a pre-tax account, to
which shall be credited all pre-tax contributions made on behalf of the
Participant, (ii) an Employer match account, to which shall be credited all
Employer match contributions and discretionary match contributions made on
behalf of the Participant and (iii) a rollover account, to which shall be
credited all rollover contributions made by the Participant. In addition, Prior
Plan Accounts shall be established for each Participant who was an active
participant in a Prior Plan on March 31, 1999 and who became a Participant on
April 1, 1999 pursuant to Section 3.1, and such Prior Plan Accounts shall be
credited with contributions made on behalf of such Participant under such Prior
Plan. Each such account shall be divided and invested as the Participant elects
in accordance with Section 7.2 among such separate investment funds maintained
or employed by the Trustee as may be designated by the Company from time to
time, which may include but are not limited to investments in securities of
open-end or closed-end investment companies and investments in any suitable
collective investment fund maintained by any bank or trust company. As directed
by the
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Company, one or more separate investment funds may be established and maintained
with respect to the Plan as adopted by the Company and its Affiliates and the
Plan as adopted by each Nonaffiliate. In addition, an investment fund called the
"Company Stock Fund" which shall be invested primarily in Company Stock shall be
established and maintained with respect to the Plan as adopted by the Company
and its Affiliates, and the Committee shall retain the discretion to determine
which Participants shall be permitted to invest in the Company Stock Fund. The
assets of the Company Stock Fund may be invested in short-term liquid
investments, to the extent determined to be necessary to satisfy such Fund's
cash needs. Unless the context otherwise requires, Participant's "account" and
"account balance" shall mean all accounts and the aggregate value of all
accounts maintained for such Participant pursuant to the Plan. Such accounts
shall be solely for accounting purposes and there shall be no segregation of
assets of the Trust Fund or of any separate investment fund among separate
accounts. The books of accounts, forms and accounting methods used in the
administration of Participants' accounts shall be the responsibility of, and
shall be subject to the supervision and control of, the Committee.
The Committee may, for administrative purposes, establish unit values
for one or more investment funds (or any portion thereof) and maintain the
accounts setting forth each Participant's interest in such investment fund (or
any portion thereof) in terms of such units, in accordance with rules and
procedures established by the Committee. In the event that unit accounting is
established for any investment fund (or any portion thereof) the value of the
Participant's interest in that investment fund (or any portion thereof) at any
time shall be an amount equal to the then value of a unit in such investment
fund (or any portion thereof) multiplied by the number of units credited to the
Participant.
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(b) Accounting for Certain Assets of Prior Plans. In connection with
the merger of the Starwood Hotels & Resorts StarSaver 401(k) Plan, the Westin
Hotel Company 401(k) Growth Opportunity Plan, the Investment Plan for Employees
of Westin Hotel Company and the ITT 401(k) Retirement Savings Plan into the Plan
as of April 1, 1999, assets of such Plans shall be accounted for under this Plan
as follows:
(1) Any pre-tax contributions (and related earnings) held in the
Starwood Hotels & Resorts Worldwide, Inc. StarSaver 401(k) Plan, the
Starwood Hotels & Resorts StarSaver 401(k) Plan, the Westin Hotel
Company 401(k) Growth Opportunity Plan or the Investment Plan for
Employees of Westin Hotel Company shall be transferred to the
Participant's pre-tax account under this Plan. Any pre-tax
contributions (and related earnings) held in the ITT 401(k) Retirement
Savings Plan shall be transferred to the Participant's ITT pre-tax
account under this Plan.
(2) Any rollover contributions (and related earnings) held in the
Starwood Hotels & Resorts Worldwide, Inc. StarSaver 401(k) Plan, the
Starwood Hotels & Resorts StarSaver 401(k) Plan, the Westin Hotel
Company 401(k) Growth Opportunity Plan or the Investment Plan for
Employees of Westin Hotel Company shall be transferred to the
Participant's rollover account under this Plan. Any rollover
contributions (and related earnings) held in the ITT 401(k) Retirement
Savings Plan shall be transferred to the Participant's ITT rollover
account.
(2) Any employer matching contributions (and related earnings) held in
the Starwood Hotels & Resorts Worldwide, Inc. StarSaver 401(k) Plan or
the Starwood Hotels & Resorts StarSaver 401(k) Plan shall be
transferred to the Participant's prior Starwood match account. Any
employer matching contributions (and related earnings) held in the
Westin Hotel Company 401(k) Growth Opportunity Plan or the Investment
Plan for Employees of Westin Hotel Company shall be transferred to the
Participant's Westin match account. Any amounts held in the employer
discretionary contributions account under the Westin Hotel Company
401(k) Growth Opportunity Plan (and related earnings) shall also be
transferred to the Participant's Westin match account. Any employer
matching contributions (and related earnings) held in the ITT 401(k)
Retirement Savings Plan shall be transferred to the Participant's ITT
match account.
(3) Any Retirement Account Plan contributions (and related earnings)
held in the Westin Hotel Company 401(k) Growth Opportunity Plan shall
be transferred to the Participant's Westin RAP account under this Plan.
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(4) Any Caesars Company Basic contributions and ITT 1% Retirement
contributions (and related earnings) held in the ITT 401(k) Retirement
Savings Plan shall be transferred to the Participant's prior plan basic
account under this Plan.
(5) Any Post-86 Matched After-Tax contributions and Supplemental Post-
86 After-Tax contributions (and related earnings) held in the ITT
401(k) Retirement Savings Plan shall be transferred to the
Participant's ITT post-86 after-tax account under this Plan.
(6) Any Pre-87 Matched After-Tax contributions and Supplemental Pre-87
After-Tax contributions (and related earnings) held in the ITT 401(k)
Retirement Savings Plan shall be transferred to the Participant's ITT
pre-87 after-tax account under this Plan.
(7) Any ESOP contributions, ITT Match contributions made prior to
October 1, 1996, and ITT Company Floor contributions (and related
earnings) held in the ITT 401(k) Retirement Savings Plan shall be
transferred to the Participant's ITT prior plan monies account under
this Plan.
(c) Accounting for Certain Assets of the Management Retirement Plan of
Westin Hotel Company. In connection with the transfer of certain excess assets
from the Management Retirement Plan of Westin Hotel Company as of April 1, 1999,
the Company shall cause to be established and maintained a reversion suspense
account to hold such assets.
Section 7.2. Investment Elections. (a) Investment elections. The
Committee shall notify Participants of the investment funds maintained or
employed by the Trustee pursuant to Section 7.1. Each Participant may, at such
time or times prescribed by the Committee and in accordance with rules and
procedures prescribed by the Committee, specify the percentage of his future
contributions and his existing account balances (in multiples established by the
Committee from time to time) that are to be invested in each of the separate
investment funds; provided, however, a Participant in the
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Plan as adopted by the Company and its Affiliates may not elect to invest more
than 25% of contributions to such Participant's account in the Company Stock
Fund and may not elect to transfer existing account balances into the Company
Stock Fund. During any period in which no direction as to the investment of a
Participant's account balances or contributions is on file with the Committee,
such account balances and contributions will be invested in the investment fund
designated by the Committee. The Committee may limit the right of a Participant
(i) to invest in a particular investment fund, (ii) to increase or decrease the
investment of contributions in a particular investment fund, (iii) to transfer
amounts to or from a particular investment fund, or (iiii) to transfer amounts
between particular investment funds, if the Committee determines that any such
limitation is necessary or desirable to establish or maintain an investment
fund. The Committee may promulgate separate accounting and administrative rules
to facilitate the establishment or maintenance of an investment fund.
Any portion of the Trust Fund which from time to time is not allocated
to Participant's accounts, including any amounts credited to the reversion
suspense account pursuant to Section 7.1(c) that have not be so allocated, shall
be invested in such manner as the Committee shall determine. The Committee shall
be a "named fiduciary" (within the meaning of such term as used in ERISA) for
this purpose.
(b) Facilitation. Notwithstanding any election of any Participant, the
Trustee shall have the right to hold uninvested or invested in a short term
investment fund any amounts intended for investment or reinvestment until such
time as investment may be made in accordance with the Plan and the Trust.
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Section 7.3. Allocation to Participants' Accounts of Net Income of
Trust and Fluctuation in Value of Trust Assets. The net worth of each investment
fund shall be determined as of each Valuation Date pursuant to Section 7.4, and
the market value of each Participant's account shall be recalculated to reflect
the net earnings and losses of each such investment fund since the preceding
Valuation Date in accordance with procedures established by the Committee.
Section 7.4. Determination of Net Worth of an Investment Fund. The net
worth of an investment fund as of any Valuation Date shall be the fair market
value of all assets (including any uninvested cash) held by such investment
fund, as determined by the Trustee on the basis of such evidence and information
as it may deem pertinent and reliable, reduced by any liabilities of the
investment fund other than Participants' accounts and reduced by contributions
made to the Trust Fund and invested in the investment fund subsequent to the
preceding Valuation Date.
Section 7.5. Crediting of Contributions to Accounts. (a) Crediting
pre-tax contributions and certain Employer match contributions The pre-tax
contributions and the Employer match contributions made pursuant to Section
4.2(a) on behalf of a Participant shall be credited to the Participant's pre-tax
account and Employer match account, respectively, as soon as administratively
practicable after, and as of, the first Valuation Date coinciding with or
following the last day of the payroll period with respect to which such contri-
butions are made.
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(b) Crediting Remaining Employer supplemental match contributions and
Discretionary Match Contributions. Any Employer match contributions pursuant to
Section 4.2 (b) or discretionary match contributions made by an Employer for a
Plan Year on behalf of a Participant shall be credited to the Participant's
Employer match account and discretionary match account, respectively, as of the
Valuation Date coinciding with the end of the Plan Year for which such
contribution is made.
(c) Crediting Amounts Contained in the Reversion Suspense Account. With
respect to each Participant who is paid from the Company's corporate payroll and
who is eligible to receive an allocation of Employer match contributions or
discretionary match contributions as described in subsections (a) or (b) of this
Section for any Plan Year, notwithstanding such subsections (a) and (b), a
portion of the balance of the reversion suspense account created pursuant to
Section 7.1, if any, shall be released and allocated to such Participant's
Employer match account or discretionary match account (as applicable) in an
amount equal to (1) with respect to the Employer match contributions, 100% of
the Participant's pre-tax contributions up to the first 2% of the Participant's
Compensation plus 50% of any additional pre-tax contributions made by the
Participant for such Plan Year up to an additional 2% of such Participant's
Compensation.
If the amount so released and allocated on behalf of all Participants
who are paid from the Company's corporate payroll does not equal or exceed the
minimum amount (as defined below) for any applicable Plan Year, an additional
amount shall be released from the reversion suspense account so that the total
amount released from such account equals the minimum amount for such Plan Year.
Such additional amount shall be
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allocated on a pro rata basis to the employer contribution account of each
Participant who is an employee of the Company as if such contributions were
Employer match contributions.
Notwithstanding anything contained in Section 7.6 of the Plan to the
contrary, amounts allocated pursuant to this subsection (c) shall be subject to
the special rules contained in section 4980(d)(2)(C)(ii) of the Code.
For purposes of this subsection, the "minimum amount" for the 1999 Plan
Year shall be one-seventh of the amount transferred to the reversion suspense
account, as adjusted for any earnings and losses thereon. In each of the six
subsequent Plan Years, the "minimum amount" shall be an amount equal to the
balance of such account (as adjusted for any earnings and losses) multiplied by
a fraction, the numerator of which is one and the denominator of which is the
number of years (including the year for which the allocation is made) remaining
in such six Plan Year period.
Section 7.6. Limitations on Allocations. Notwithstanding any other
provision of the Plan, the amounts allocated pursuant to Section 7.5 to a
Participant's accounts under the Plan for each Plan Year shall be limited so
that (1) the aggregate annual additions to the Participant's accounts under the
Plan and under all other defined contribution plans maintained by an Employer
shall not exceed the lesser of (i) $30,000 (as adjusted for cost-of-living
increases in accordance with section 415(d)(1)(C) of the Code), and (ii) 25% of
the Participant's compensation for such Plan Year; and (2) for Plan Years
beginning before January 1, 2000 the sum of (A) and (B) below shall not exceed
1.
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(A) The sum of the annual additions to the Participant's accounts in
the Plan and the aggregate annual additions to the Participant's accounts in
all other defined contribution plans maintained by an Employer (computed as
of the close of the Plan Year for which these computations are being made)
for each Plan Year during which the Participant shall have participated in
any such plan divided by the sum of, calculated with respect to each such
Plan Year, the lesser of:
(I) 125% of the maximum dollar amount which under section
415(c)(1)(A) of the Code could have been contributed on behalf of the
Participant to a defined contribution plan for such Plan Year, and
(II) 35% of the Participant's compensation, for such Plan
Year.
(B) The aggregate projected annual benefit of the Participant under all
defined benefit plans maintained by an Employer (determined as of the close
of the Plan Year for which these computations are being made) divided by the
lesser of:
(I) 125% of the maximum dollar limitation contained in section
415(b)(1)(A) of the Code as adjusted for increases in the cost of
living as set forth in section 415(d) of the Code, and
(II) 140% of the average of the Participant's compensation for
the three consecutive calendar years of his participation in such
defined benefit plans during which his compensation was the highest.
If the amount to be allocated to a Participant's accounts pursuant to
Section 7.5 for a Plan Year would exceed any of the limitations set forth in
this Section, the amount of the pre-tax contributions and any discretionary
match contributions and, if necessary, Employer match contributions to be
allocated to such Participant's accounts shall be reduced in that order to the
extent necessary to comply with such limitation. Any reductions in pre-tax
contributions shall be paid to such Participant as additional compensation. If
as a result of reasonable error in estimating a Participant's annual
compensation, or other limited facts and circumstances as determined by the
Commissioner of Internal Revenue, the annual additions to a Participant's
accounts exceed
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the limitations set forth above for any Plan Year and the excess contributions
cannot be returned to the Participant or the Employer, the amount of annual
additions in excess of such limitations shall be held in a segregated suspense
account which shall be invested but shall not be credited or debited with its
own gains or losses and shall not share in gains or losses of the Trust and
shall be treated in the succeeding Plan Year as Employer match contributions or
discretionary match contributions thereby reducing amounts actually contributed
for such year. The balance, if any, in such suspense account shall be returned
to the Employer upon termination of the Plan only if the allocation upon Plan
termination of such amount to Participants would cause all Participants to
receive annual additions in excess of the limitations of section 415 of the
Code.
For purposes of this Section, the "annual additions" for a Plan Year to
a Participant's accounts in the Plan and his accounts in any other defined
contribution plans is the sum during such Plan Year of:
(i) the amount of pre-tax contributions, Employer match contributions,
discretionary match contributions and after-tax contributions (but excluding
any rollover contribution (within the meaning of sections 402(a)(5),
403(a)(4), 408(d)(3) and 409(b)(3)(C) of the Code) or any direct transfers
made to such plan) allocated to such Participant's accounts,
(ii) the amount of forfeitures allocated to such Participant's
accounts, and
(iii) contributions allocated on behalf of the Participant to any
individual medical benefit account as defined in section 415(l) of the Code
and the additional reserve for post-retirement medical and life insurance
benefits (as defined in section 419A(d)(2) of the Code) maintained on behalf
of the Participant.
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For purposes of this Section, the terms "defined contribution plan", "projected
annual benefit", "defined benefit plan", and "compensation" shall have the
meanings set forth in section 415 of the Code and the Regulations, and the term
"Employer" shall include all Affiliates of the Employer of the Participant
except that in defining Affiliates "more than 50%" shall be substituted for "at
least 80 percent" where required by section 415(g) of the Code.
Section 7.7. Correction of Error. If it comes to the attention of the
Committee that an error has been made in any of the allocations prescribed by
this Article 7 appropriate adjustment shall be made to the accounts of all
Participants and designated Beneficiaries which are affected by such error,
except that no adjustment need be made with respect to any Participant or
Beneficiary whose account has been distributed in full prior to the discovery of
such error.
ARTICLE 8
DISTRIBUTIONS AND WITHDRAWALS
Section 8.1. Termination of Employment Under Circumstances Entitling
Participant to Full Distribution of His Account. If a Participant's employment
terminates under any of the following circumstances, the Participant, or his
Beneficiary if the Participant dies prior to the distribution of his account
balance, as the case may be, shall
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be fully vested in, and therefore entitled to receive pursuant to Section 8.3,
the entire balance of the Participant's accounts:
(i) After the Participant attains age 65.
(ii) Because of the Participant's death.
(iii) Because of the Participant's Total and Permanent Disability.
(iv) After the Participant is credited with at least 3 Years of
Service.
For purposes of this Article 8, a Participant shall not be treated as
experiencing a termination of employment upon such Participant's transfer of
employment among the Employers.
Section 8.2. Termination of Employment under Circumstances Resulting in
Partial Forfeiture of the Participant's Account. If a Participant's employment
terminates under circumstances other than those set forth in Section 8.1, the
Participant, or his Beneficiary if the Participant dies prior to the
distribution of his account balance, as the case may be, shall be entitled to
receive pursuant to Section 8.3, (i) the entire balance of the Participant's
pre-tax account, rollover account and Prior Plan Nonforfeitable Accounts (as
applicable) and (ii) a percentage of the balance of the Participant's Employer
match account and Prior Plan Forfeitable Accounts (as applicable) which
percentage shall be determined pursuant to the following table by reference to
the Participant's Years of Service as of his termination of employment;
provided, however, that if a Participant was an active participant in a Prior
Plan on March 31, 1999 and became a Participant on April 1, 1999 pursuant to
Section 3.1, his vested percentage in his Prior Plan Accounts shall never be
less than his vested percentage in such accounts would have been under the terms
of the applicable Prior Plan in effect on March 31, 1999:
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Years of Service Percentage Vested
Less than 3 0
3 or more 100
The difference between the balance of the Participant's Employer match account
and Prior Plan Forfeitable Accounts (as applicable) and the percentage of such
accounts in which the Participant or his Beneficiary is vested shall be charged
to such accounts and forfeited. Such charge and forfeiture shall occur as soon
as administratively practicable following the Participant's termination of
employment.
Section 8.3. Time and Form of Distribution upon Termination of
Employment. (a) Form of distribution. Any distribution to which a Participant or
Beneficiary becomes entitled upon termination of employment shall be distributed
by the Trustee in a single lump sum payment unless the Participant or
Beneficiary elects to receive his distribution in installment payments in
approximately equal monthly or annual cash installments over a fixed period not
to exceed 20 years. A Participant who elects monthly or annual installments may
at any time elect to receive a single lump sum of the remaining value of his
unpaid installments. If a Participant dies before all installments have been
paid, the remaining value of his unpaid installments shall be paid in the form
of a single lump sum to his Beneficiary; provided, however, that such
Beneficiary may elect in the time and manner prescribed by the Committee to
continue payment in the installment form elected by the Participant. Any
distribution from the Plan shall be made in the form of cash; provided, however,
that a Participant may elect to receive the value of his account invested
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in the Company Stock Fund in full shares of Company Stock and in cash for any
fractional shares.
Notwithstanding the foregoing, (i) a Participant who has an ITT pre-tax
account, ITT rollover account, ITT match account, prior plan basic account, ITT
post-86 after-tax account, ITT pre-87 after-tax account, ITT prior plan monies
account or Westin RAP account may elect to receive the vested balance in such
accounts through the purchase of a nonforfeitable single life annuity, provided
that if the Participant is married, the benefit shall be in the form of a
qualified joint and survivor annuity. In order for a married Participant to make
an election to receive the vested portion of such accounts in the form of a
nonforfeitable single life annuity, he must obtain his spouse's written and
notarized consent that acknowledges the effect of the Participant's election and
delivers such consent to the Committee in the time and manner specified by the
Committee. The Committee shall furnish to each Participant eligible to receive
this benefit a written explanation of the qualified joint and survivor annuity
in accordance with applicable law no less than 30 days and no more than 90 days
before such Participant's annuity starting date. A Participant may revoke his
election and make a new election from time to time and at any time during the
election period beginning 90 days before the Participant's annuity starting
date. If the annuity form selected is not a qualified joint and survivor annuity
with the Participant's spouse as the beneficiary, the annuity payable to the
Participant and thereafter to his beneficiary shall be subject to the incidental
death benefit rule pursuant to section 401(a)(9) of the Code and Regulations
thereunder.
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(b) Time of Distributions. Upon a Participant's termination of
employment, distribution of the Participant's vested account balance shall be
made as of any Valuation Date elected by the Participant in accordance with
rules and procedures established by the Committee; provided, however, that if
the Participant fails to make a valid election in accordance with rules and
procedures prescribed by the Committee prior to such date, distribution of the
Participant's vested account balance shall be made by payment of a single lump
sum as soon as administratively practicable after the last Valuation Date of the
Plan Year during which the Participant attains age 65.
Distribution to a Participant shall be made not later than the April 1
of the calendar year following the later of the calendar year in which the
Participant attains age 70-1/2 or the calendar year in which the Participant
terminates employment, except that distribution to a Participant who is a "five
percent owner" (as defined in section 416(i) of the Code) at any time during the
Plan Year ending in the calendar year in which the Participant attains age
70-1/2 shall be made no later than April 1 of the calendar year following the
calendar year in which the Participant attains age 70-1/2. Notwithstanding any
provision of this Section to the contrary, if the vested account balance of a
Participant does not exceed $5,000 (or such other amount prescribed by Section
411(a)(11) of the Code), as of the last Valuation Date of the Plan Year during
which the Participant terminates employment, such account shall be distributed
in one lump sum payment as soon as administratively practical after such
Valuation Date. A distribution may commence less than 30 days after the notice
required under section 1.411(a)-11(c) of the Regulations is given only if the
Committee clearly informs the Participant that the Participant has a right to a
period of at least 30 days after receiving the notice to consider the decision
of whether
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or not to elect a distribution, and the Participant, after receiving the notice,
affirmatively elects a distribution.
(c) Time of distribution to Beneficiary. If prior to the Participant's
death the distribution of his vested account balance had not been made, then
distribution of his vested account balance shall be made to his Beneficiary as
soon as administratively practicable after the first Valuation Date coinciding
with or following his death; provided, however, that if the Participant's
Beneficiary is the Participant's spouse, distribution may be deferred, at the
Beneficiary's election, until as late as the date on which the Participant would
have attained age 70-1/2 had the Participant survived. Notwithstanding the
foregoing, if a Participant who has elected an annuity under Section 8.3(a)(2)
with respect to his Prior Plan Accounts attributable to the ITT 401(k)
Retirement Savings Plan or his Westin RAP account dies before his benefit
commences and his spouse was his Beneficiary with respect to the annuity,
payment of such Prior Plan Accounts shall be made to such spouse in the form of
a life annuity unless the spouse elects a single lump sum payment.
Section 8.4. Designation of Beneficiary. Each Participant shall have
the right to designate a Beneficiary or Beneficiaries (who may be designated
contingently or successively and which may be an entity other than a natural
person) to receive any distribution to be made under Section 8.1 upon the death
of such Participant or, in the case of a Participant who dies subsequent to
termination of his employment but prior to the distribution of the entire amount
to which he is entitled under Section 8.2, any undistributed balance to which
such Participant was entitled under such Section; provided, however, that
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no such designation shall be effective if the Participant was married through
the one-year period ending on the date of the Participant's death unless such
designation was consented to at the time of such designation by the person who
was the Participant's spouse during such period, in writing, acknowledging the
effect of such consent and witnessed by a notary public or a Plan
representative, or it is established to the satisfaction of the Committee that
such consent could not be obtained because the Participant's spouse cannot be
located or such other circumstances as may be prescribed in Regulations. A
Participant may from time to time, without the consent of any designated
Beneficiary, cancel any such designation. Such designation and each cancellation
thereof shall be made in the form prescribed by the Committee and shall be filed
with the Committee. If (i) no Beneficiary has been designated by a deceased
Participant, (ii) any such designation is not effective pursuant to the proviso
contained in the first sentence of this Section, or (iii) the designated
Beneficiary has predeceased the Participant, any undistributed vested balance of
the deceased Participant shall be distributed at the direction of the Committee
(a) to the surviving spouse of such deceased Participant, if any, or (b) if
there is no surviving spouse, to the surviving children of such deceased
Participant, if any, in equal shares, or (c) if there is no surviving spouse or
surviving children, to the executor or administrator of the estate of such
deceased Participant, or (d) if no executor or administrator has been appointed
for the estate of such deceased Participant within six months following the date
of the Participant's death, in equal shares to the person or persons who would
be entitled under the intestate succession laws of the state of the
Participant's domicile to receive the Participant's personal estate. The
marriage of a Participant shall be deemed to revoke any prior designation of a
Beneficiary made by him and a divorce shall be deemed to revoke any prior
designation of the Participant's divorced
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spouse if written evidence of such marriage or divorce shall be received by the
Committee before distribution has been made in accordance with such designation.
Section 8.5. Investment of Distributee Accounts. If distribution of the
amount to which a Distributee becomes entitled is made later than the first
Valuation Date coincident with or following the Participant's termination of
employment, the undistributed balance of such amount shall be credited as of
such Valuation Date to an account established and maintained in the name of the
Distributee entitled to receive the same. For purposes of investment elections
that can be made pursuant to Section 7.2, the allocations prescribed in Section
7.3, and any distribution of assets pursuant to Section 16.4 upon termination of
the Plan, a Distributee for whom a Distributee Account is established shall be
deemed to be a Participant and such account shall be deemed to be a
Participant's account.
Section 8.6. Distributions to Minor and Disabled Distributees. Any
distribution under this Article which is payable to a Distributee who is a minor
or to a Distributee who, in the opinion of the Committee, is unable to manage
his affairs by reason of illness or mental incompetency may be made to or for
the benefit of any such Distributee at such time consistent with the provisions
of this Article and in such of the following ways as the legal representative of
such Distributee shall direct: (a) directly to any such minor Distributee if, in
the opinion of such legal representative, he is able to manage his affairs, (b)
to such legal representative, (c) to a custodian under a Uniform Gifts to Minors
Act for any such minor Distributee, or (d) to some near relative of any such
Distributee to be used for the latter's benefit. The Committee shall be required
to see to the application by any
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third party other than the legal representative of a Distributee of any
distribution made to or for the benefit of such Distributee pursuant to this
Section.
Section 8.7. "Lost" Participants and Beneficiaries. If within a
reasonable period following the death or other termination of employment of any
Participant the Committee in the exercise of reasonable diligence has been
unable to locate the person or persons entitled to benefits under this Article,
the rights of such "lost" Participant or "lost" Beneficiary, as the case may be,
shall be forfeited; provided, however, that the Plan shall reinstate and pay to
such "lost" Participant or "lost" Beneficiary, as the case may be, the amount of
the benefits so forfeited upon a claim for such benefits made by such person.
The amount to be so reinstated shall be obtained by the Employer in respect of
whose Employee the claim for forfeited benefit is made contributing an amount
equal to the amount to be so reinstated. Any such contribution shall be made
without regard to whether or not the limitations set forth in Section 7.7 will
be exceeded by such contribution.
Section 8.8. Withdrawals from Accounts During Employment. (a)
Withdrawals upon incurring financial hardship. A Participant who the Committee
determines, in its sole discretion, to be incurring a "financial hardship" based
on information the Participant provides to the Committee for this purpose may
elect to withdraw after the Committee has made such determination an amount
from his rollover account, pre-tax account (which is not greater than all
pre-tax contributions made to the Plan up to the most recent Valuation Date to
the extent not previously withdrawn) and Prior Plan Nonforfeitable Accounts
other than his ITT prior plan monies account (as applicable and provided that no
investment earnings allocated to any such account that is a pre-tax
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account after December 31, 1988 shall be available for withdrawal under this
Section 8.8(a)) and from vested amounts in his Employer match account and Prior
Plan Forfeitable Accounts other than his Westin RAP account (as applicable);
provided, however, that no such amount to be withdrawn shall be less than $300
or exceed the amount the Committee determines is necessary to satisfy such
hardship. A Participant may apply for a hardship withdrawal pursuant to this
Section in accordance with the rules and procedures established by the
Committee. Hardship withdrawals shall be made from vested amounts held in the
Participant's accounts in the following order:
(1) ITT pre-87 after-tax account
(2) ITT post-86 after-tax account
(3) ITT rollover account
(4) rollover account
(5) ITT prior plan monies account
(6) ITT match account
(7) Westin match account
(8) prior Starwood match account
(9) Employer match account
(10) ITT pre-tax account (and any
earnings allocated to such account
prior to January 1, 1989)
(11) pre-tax account (and any earnings
allocated to such account prior to
January 1, 1989)
The determination of the existence of "financial hardship" and the
amount required to be distributed to satisfy the need created by the hardship
will be made by the Committee in a uniform and non-discriminatory manner subject
to the following rules:
(A) A financial hardship shall be deemed to exist only if the
Participant certifies to the Committee in writing that the financial need is
for one of the following reasons:
(i) medical expenses described in section 213(d) of the Code
previously incurred by the Participant, the Participant's spouse or any
dependents of the Participant (as defined in
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section 152 of the Code) or necessary for these persons to obtain
medical care described in section 213(d) of the Code;
(ii) costs directly related to the purchase (excluding
mortgage payments) of a principal residence for the Participant;
(iii) the payment of tuition, related educational fees, and
room and board expenses for the next twelve months of post-secondary
education for the Participant, the Participant's spouse, children or
dependents; or
(iv) the need to prevent eviction of the Participant from his
principal residence or foreclosure on the mortgage of the Participant's
principal residence.
(B) A distribution shall be treated as necessary to satisfy a financial
need only if the following requirements are satisfied:
(i) the Participant certifies to the Committee in writing (and
if the Committee has no reason to believe that such certification is
inaccurate) that such need cannot be relieved (without increasing the
amount of the need) by or through compensation or reimbursement by
insurance, by taking any available loans from the Plan, by reasonable
liquidation of the Participant's assets (including for this purpose
assets of the Participant's spouse and minor children that are
reasonably available to the Participant) or otherwise; and
(ii) the Participant has obtained all other distributions and
all nontaxable loans currently available under all plans maintained by
his Employer or an Affiliate of his Employer.
(C) The Participant shall be required to submit any additional
supporting documentation as may be requested by the Committee. The
Committee's determination of the amount necessary to satisfy any financial
hardship can, in the Committee's sole discretion, include consideration of
the amounts that will be necessary for the Participant to pay any federal,
state or local income taxes or penalties reasonably anticipated to result
from a withdrawal made on account of a financial hardship.
(b) Penalties resulting from withdrawals. If a Participant makes a
withdrawal pursuant to paragraph (a) of this Section, (i) pre-tax contributions
and all other elective and employee contributions made on behalf of or made by
such Participant under the Plan and
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all other plans of his Employer and his Employer's Affiliates (other than such
contributions to a health or welfare benefit plan) shall cease beginning with
the date on which the Participant receives such withdrawal; and (ii) such
Participant shall not again be eligible to elect or otherwise have such
contributions commence until the first day of the first month which follows end
of the twelve-month period following the date on which such withdrawal is made;
and (iii)the Participant's maximum amount of permitted pre-tax contributions in
the calendar year following the year in which the withdrawal is made shall be
reduced as provided in Section 1.402(k)-1(d)(2)(iv)(B)(3) of the Regulations. In
all respects, this subsection (b) is to be interpreted and administered so as to
be consistent with the requirements set for in Section 1.401(k)-1(d)(2)(iv)(B)
of the Regulations.
(c) Age 59-1/2 Withdrawals. A Participant who has attained age 59-1/2
may elect to withdraw as of any Valuation Date from his pre-tax account,
rollover account and Prior Plan Nonforfeitable Accounts other than his prior
plan basic account (as applicable) and from vested amounts in his match account
and Prior Plan Forfeitable Accounts (as applicable) an amount which is not less
than $500 and not greater than the combined value of the vested amounts held in
such accounts as of such Valuation Date. An eligible Participant may request a
withdrawal under this Section 8.8(c) in the time and manner prescribed by the
Committee. Such withdrawals shall be made from vested amounts held in the
Participant's accounts in the following order:
(1) ITT pre-87 after-tax account
(2) ITT post-86 after-tax account
(3) ITT rollover account
(4) rollover account
(5) ITT prior plan monies account
(6) ITT match account
(7) prior Starwood match account
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(8) Westin match account
(9) Employer match account
(10) ITT pre-tax account
(11) pre-tax account
(12) Westin RAP account
(d) Distributions from a Participant's Rollover Account. A Participant
may elect to withdraw as of any Valuation Date from his rollover account and ITT
rollover account (as applicable) an amount which is not less than $500 and not
greater than the combined value of such accounts as of such Valuation Date. An
eligible Participant may request a withdrawal under this Section 8.8(d) in the
time and manner prescribed by the Committee. No more than two such withdrawals
shall be permitted each Plan Year.
(e) Distributions to Former Participants in the ITT 401(k) Retirement
Savings Plan. A Participant who participated in the ITT 401(k) Retirement
Savings Plan on March 31, 1999 and who became a Participant on April 1, 1999
pursuant to Section 3.1 may elect to withdraw as of any Valuation Date from his
ITT Prior Plan Accounts (other than his prior plan basic account) prior to his
attainment of age 59 1/2 an amount not less than $500 and not greater than the
combined value of the vested amounts held in such accounts on such Valuation
Date. Such withdrawal shall be made from the Participant's ITT Prior Plan
Accounts in the following order:
(1) ITT pre-87 after-tax account
(2) ITT post-86 after-tax account
(3) ITT rollover account
(4) ITT prior plan monies account
(5) amounts contained in his ITT match account
attributable to vested amounts contributed
to the ITT Corporation Investment and
Savings Plan for Salaried Employees before
1990 and the ITT 401(k) Retirement Savings
Plan before October 1, 1996.
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An eligible Participant may request a withdrawal from his ITT Prior Plan
Accounts under this Section 8.8(e) in the time and manner prescribed by the
Committee. No more than two such withdrawals shall be permitted each Plan Year.
Section 8.9. Loans to Participants. (a) Making of Loans. Subject to the
restrictions set forth in this Section, the Committee shall establish a loan
program whereby any Participant may request, in accordance with the rules and
procedures established by the Committee, to borrow funds from the Plan. The
principal balance of any such loan cannot be less than $1,000 and shall not
exceed the lesser of (1) 50% of the aggregate of the Participant's vested
account balances as of the Valuation Date coinciding with or immediately
preceding the day on which the loan is made, and (2) $50,000 reduced by the
highest outstanding loan balance of the Participant under all plans maintained
by his Employer during the period of time beginning one year and one day prior
to the day such loan is to be made and ending on the day prior to the day such
loan is to be made.
(b) Restrictions on loans. No Participant may have more than two loans
outstanding at any time. Any loan approved by the Committee pursuant to
paragraph (a) of this Section shall be made only upon the following terms and
conditions:
(1) The period for repayment of the loan shall be arrived at by mutual
agreement between the Committee and the Participant but such period shall
not exceed five years from the date of the loan; provided, however, that if
the purpose of the loan as determined by the Committee is to acquire any
dwelling unit which within a reasonable time is to be used as the principal
residence of the Participant, then such period for repayment must be no
longer than ten years from the date of the loan. Such loan may be prepaid in
whole or in part, without penalty, by delivery to the Committee of cash in
an amount equal to the amount of the prepayment.
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(2) No loan shall be made unless the Participant consents to have such
loan repaid in substantially equal installments deducted from the regular
payments of the Participant's compensation during the term of the loan. Any
loan is due in full upon termination of employment; provided, however that
loan repayments under the Plan will be suspended with respect to
Participants in Military Service as permitted under Section 414(u)(4) of the
Code.
(3) Each loan shall be evidenced by the Participant's collateral
promissory note for the amount of the loan, with interest, payable to the
order of the Trustee, in substantially equal installments (payable at least
quarterly), and shall be secured by an assignment of 50% of the
Participant's vested benefit under the Plan.
(4) Each loan shall bear a fixed interest rate commensurate with the
interest rate then being charged by persons in the business of lending money
in the area of the Employer for loans made under similar circumstances.
(5) The Committee may, in its sole discretion, restrict the amount to
be disbursed pursuant to any loan request to the extent it deems necessary
to take into account any fluctuations in the value of a Participant's
accounts since the Valuation Date immediately preceding the date on which
such loan is to be made.
(6) If a loan is not satisfied at the time a distribution to a
Participant shall be made and it is determined by the Committee that the
loan cannot be satisfied without unreasonable expense to the Trust, the
Trustee shall, upon direction of the Committee, distribute in satisfaction
of the loan the promissory note of the Participant.
(7) Each Participant requesting a loan shall, as a condition of
receiving such loan, pay such reasonable loan processing fee as shall be set
from time to time by the Committee. Such fee may be paid from the loan
proceeds.
(c) Applicability. The provisions of this Section shall apply to each
Participant and Beneficiary of a deceased Participant if such Participant or
Beneficiary is a "party in interest" as defined in section 3(14) of ERISA. Each
reference in this Section to "Participant" shall include such Beneficiaries of
deceased Participants except that the requirements of Section 8.9(b) shall not
apply to a loan made to any Participant or
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Beneficiary who is a "party in interest" after the Participant's termination of
employment.
Section 8.10. Direct Rollovers. (a) Election. A Distributee may elect,
at the time and in the manner prescribed by the Committee, to have any portion
of an eligible rollover distribution paid directly to an eligible retirement
plan specified by the Distributee in a direct rollover.
(b) Definitions. For purposes of this Section:
(i) An "eligible rollover distribution" is any distribution being made
pursuant to the terms of the Plan of all or any portion of the balance to
the credit of the Distributee, except that an eligible rollover distribution
does not include: any distribution that is one of a series of substantially
equal periodic payments (not less frequently than annually) made for the
life (or life expectancy) of the Distributee or the joint lives (or joint
life expectancies) of the Distributee and the Distributee's designated
Beneficiary, or for a specified period of ten years or more; any
distribution to the extent such distribution is required under section
401(a)(9) of the Code; and the portion of any distribution that is not
includible in gross income.
(ii) An "eligible retirement plan" is an individual retirement account
described in section 408(a) of the Code, an individual retirement annuity
described in section 408(b) of the Code, an annuity plan described in
section 403(a) of the Code, or a qualified trust described in section 401(a)
of the Code, that accepts the Distributee's eligible rollover distribution.
However, in the case of an eligible rollover distribution to a Distributee
who is a spouse, former spouse or surviving spouse, an eligible retirement
plan is an individual retirement account or individual retirement annuity.
(iii) For purposes of this Section, 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. A "Distributee"
shall not include a Participant who transfers employment among the Employers
participating in the Plan.
(iv) A "direct rollover" is a payment by the Plan to the eligible
retirement plan specified by the Distributee.
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ARTICLE 9
SPECIAL PARTICIPATION AND DISTRIBUTION RULES
RELATING TO REEMPLOYMENT OF TERMINATED
EMPLOYEES AND EMPLOYMENT BY RELATED ENTITIES
Section 9.1. Change of Employment Status. If an Employee who is not an
Eligible Employee becomes an Eligible Employee, he shall become a Participant as
of the first Entry Date after satisfying the eligibility requirements described
in Article 3; provided, however, that if upon so becoming an Eligible Employee
such eligibility requirements have already been satisfied and the first Entry
Date after the Participant satisfied such eligibility requirements has occurred,
the Employee shall become a Participant upon becoming an Eligible Employee.
Section 9.2. Reemployment of an Eligible Employee Whose Employment
Terminated Prior to His Becoming a Participant. If an Eligible Employee whose
employment was terminated before he became a Participant is reemployed by any
Employer, such Employee shall become a Participant in accordance with Article 3,
not ignoring for this purpose any Hours of Service credited prior to his
termination unless prior to his termination the Eligible Employee was not
credited with any Years of Service and after his termination incurred at least
five consecutive Break in Service Years; provided, however, that if prior to
becoming so reemployed the service and age requirements described in Article 3
have been satisfied, the Eligible Employee shall become a Participant upon
becoming so reemployed or, if later, upon the first Entry Date following the day
such requirements were satisfied.
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Section 9.3. Reemployment of a Terminated Participant. If a terminated
Participant is reemployed, he shall again become a Participant upon the date of
his reemployment. If a terminated Participant is entitled to receive a
distribution from his accounts pursuant to Article 8, such distribution shall be
suspended during his period of reemployment. If the Participant is reemployed
prior to incurring five consecutive Break in Service Years, thereafter completes
a Year of Service before incurring five consecutive Break in Service Years and,
at or after his termination of employment, a portion or all of his Employer
match account and Prior Plan Forfeitable Accounts (as applicable) was forfeited
pursuant to Section 8.2 but such Participant did not receive or commence to
receive a distribution pursuant to Article 8, then an amount equal to the
portion of such account(s) which was forfeited shall be credited to his Employer
match account and Prior Plan Forfeitable Accounts (as appropriate) as of the
close of the Plan Year in which he received a distribution. If upon his
termination of employment any such Participant received a distribution pursuant
to Article 8 and some portion of his Employer match account, prior Starwood
match account and ITT match account balances (as applicable) was forfeited
pursuant to Section 8.2, then he shall have the right to pay an amount equal to
such distribution to the Trustee. If the Participant makes such a payment, then
an amount equal to the portion of such account(s) which was forfeited pursuant
to Section 8.2 shall be credited along with the amount of such payment to his
Employer match account, prior Starwood match account and ITT match account (as
appropriate) as of the close of the Plan Year in which such payment is made. Any
such payment must be made by the fifth anniversary of the Participant's date of
reemployment. Notwithstanding the foregoing, if a Participant who received a
distribution from the Westin Hotel Company 401(k) Growth Opportunity Plan upon
his termination of employment prior to the Effective Date, such
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Participant shall not be required to pay an amount equal to such distribution to
the Trustee and an amount equal to the portion of such account(s) which was
forfeited (if any) shall be credited Westin Prior Plan Forfeitable Accounts (as
appropriate) as of the close of the Plan Year in which he received a
distribution.
For purposes of determining the Participant's vested percentage under
Section 8.2, Years of Service completed prior to a Break in Service Year
incurred by a Participant who was not credited with two or more Years of Service
prior to such Break in Service Year shall be disregarded unless the total number
of Break in Service Years is less than five and such Participant completes a
Year of Service after his reemployment. For all other Participants, Years of
Service completed prior to a Break in Service Year shall be disregarded in
determining a Participant's vested percentage under Section 8.2 until such
Participant completes a Year of Service after his reemployment.
Section 9.4. Leased Employees. If an individual who performed services
as a leased employee (within the meaning of section 414(n)(2) of the Code) of an
Employer or an Affiliate becomes an Employee, or if an Employee becomes such a
leased employee, then any period during which such services were so performed
shall be taken into account solely for the purposes of determining whether and
when such individual is eligible to participate in the Plan under Article 3 and
determining when such person has retired or otherwise terminated his employment
for purposes of Article 8 to the same extent it would have been had such service
been as an Employee who is not an Eligible Employee. This Section shall not
apply to any period of service during which such a leased employee was covered
by a plan described in section 414(n)(5) of the Code.
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Section 9.5. Employment by Related Entities. If a person is employed by
any Affiliate of any Employer, any period of employment by such Affiliate shall
be taken into account for the purpose of determining whether and when such
person is eligible to participate in the Plan under Article 3 after he becomes
an Eligible Employee and determining when such person has retired or otherwise
terminated employment for purposes of Article 8 to the same extent it would have
been had such period of employment been as an Employee who is not an Eligible
Employee.
ARTICLE 10
PARTICIPANTS' STOCKHOLDER RIGHTS
Section 10.1. Voting Shares of Company Stock and Other Securities. The
Trustee shall vote, in person or by proxy, shares of Company Stock and other
securities held by the Trustee which are allocated to a Participant's account in
accordance with instructions obtained from such Participant (or Beneficiary).
Each Participant (or Beneficiary) shall be entitled to give voting instructions
with respect to the number of shares of Company Stock or such other security
allocated to his account as of the valuation date prior to the shareholder
record date for such vote. Written notice of any meeting of stockholders of the
Company or of the issuer of such other security and a request for voting
instructions shall be given by the Committee or the Trustee, at such time and in
such manner as the Committee shall determine, to each Participant (or
Beneficiary) entitled to give instructions for voting shares of Company Stock or
such other security at such meeting. All shares of Company Stock and other
securities allocated to Participants'
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(or Beneficiaries') accounts for which no voting instructions are received shall
be voted in accordance with the terms of the Trust.
Section 10.2. Tender Offers. (a) Rights of Participants. In
the event a tender or exchange offer is made generally to the shareholders of
the Company to transfer all or a portion of their shares of Company Stock in
return for valuable consideration, including but not limited to, offers
regulated by section 14(d) of the Securities Exchange Act of 1934, as amended,
the Trustee shall respond to such tender or exchange offer in respect of shares
of Company Stock allocated to a Participant's (or Beneficiary's) account in
accordance with instructions obtained from such Participation (or Beneficiary).
Each Participant (or Beneficiary) shall be entitled to give instructions with
respect to tendering or withdrawal from tender of such shares. A Participant (or
Beneficiary) shall not be limited in the number of instructions to tender or
withdraw from tender which he can give but a Participant (or Beneficiary) shall
have the right to give instructions to tender or withdraw from tender after a
reasonable time established by the Trustee pursuant to paragraph (c) below. The
Trustee shall respond to any such tender or exchange offer in respect of all
shares of Company Stock allocated to Participants' (or Beneficiaries') accounts
in accordance with the terms of the Trust. All instructions from the Participant
(or Beneficiary) shall be kept confidential and shall not be disclosed to any
person, including the Company.
(b) Duties of the Committee. Within a reasonable time after
the commencement of a tender or exchange offer, the Committee or the Trustee
shall provide to each Participant:
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(i) the offer to purchase or exchange as distributed by the
offeror to the shareholders of the Company,
(ii) a statement of the shares of Company Stock allocated to
his account, and
(iii) directions as to the means by which a Participant can
give instructions with respect to the tender or exchange offer.
The Committee shall establish and pay for a means by which a
Participant (or Beneficiary) can expeditiously deliver to the committee
instructions addressed to the Trustee with respect to a tender or exchange
offer. The Committee shall transmit to the Trustee aggregate numbers of shares
to be tendered or withheld from tender representing instructions of Participants
(or Beneficiaries). The Committee, at its election, may engage an agent to
receive instructions from Participants (or Beneficiaries) and transmit them to
the trustee.
(c) Duties of the Trustee. The Trustee shall follow the
instructions of the Participants (or Beneficiaries) with respect to the tender
or exchange offer as transmitted to the Trustee. The Trustee may establish a
reasonable time, taking into account the time restrictions of the tender or
exchange offer, after which it shall not accept instructions of Participants (or
Beneficiaries).
ARTICLE 11
ADMINISTRATION
Section 11.1. The Plan Administrator. (a) With respect to the
Plan as adopted by the Company and its Affiliates, the Company shall be the
"administrator" and
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"named fiduciary" of the Plan within the meaning of such terms as used in ERISA.
With respect to the Plan as adopted by a Nonaffiliate, such Nonaffiliate shall
be the "administrator" and "named fiduciary" of the Plan within the meaning of
such terms as used in ERISA. The board of directors of the Company shall appoint
a committee consisting of three or more members which shall be known as the
Employees' Savings and Retirement Plan Committee (the "Committee"). Such
Committee shall be responsible for carrying out the Company's duties as
"administrator" and, except for duties specifically vested in the Trustee, for
the administration of the provisions of the Plan. By its adoption of the Plan, a
Nonaffiliate shall be deemed to have appointed the Committee to be responsible
for its duties as "administrator" and, except for duties specifically vested in
the Trustee, for the administration of the provisions of the Plan. By the
Company's consent to the adoption of the Plan by a Nonaffiliate, the Committee
shall be deemed to have consented to such appointment and delegation of duties,
and shall fulfill the rights and duties set forth in the Plan with respect to
such Nonaffiliate until the Committee notifies the Nonaffiliate that it will no
longer serve as "administrator" of the Plan as adopted by the Nonaffiliate. The
Secretary of the Committee shall be the Plan's agent for service of legal
process. The board of directors of the Company shall have the right at any time,
with or without cause, to remove any member or members of the Committee. A
member of the Committee may resign and his resignation shall be effective upon
delivery of his written resignation to the Company. Upon the resignation,
removal or failure or inability for any reason of any member of the Committee to
act hereunder, the board of directors of the Company shall appoint a successor
member. All successor members of the Committee shall have all the rights,
privileges and duties of their predecessors, but shall not be held accountable
for the acts of their predecessors.
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(b) Any member of the Committee may, but need not, be an
employee or a director, officer or shareholder of any of the Employers, and such
status shall not disqualify him from taking any action hereunder or render him
accountable for any distribution or other material advantage received by him
under the Plan, provided that no member of the Committee who is a Participant
shall take part in any action of the Committee or any matter involving solely
his rights under the Plan.
(c) Promptly after the appointment of the original members of
the Committee and from time to time thereafter promptly after the appointment of
any successor member of the Committee, the Trustee shall be notified as to the
names of the persons appointed as members or successor members of the Committee
by delivery to the Trustee of a certified copy of the resolution of the board of
directors of the Company making such appointment.
(d) The Committee shall have the duty and authority to
interpret and construe the Plan in regard to all questions of eligibility, the
status and rights of Participants, Distributees and other persons under the
Plan, and the manner, time, and amount of payment of any distribution under the
Plan. Each Employer shall, from time to time, upon request of the Committee,
furnish to the Committee such data and information as the Committee shall
require in the performance of its duties.
(e) The Committee shall direct the Trustee to make payments of
amounts to be distributed from the Trust under Article 8 and to withhold
applicable taxes therefrom.
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(f) The members of the Committee may allocate their
responsibilities among themselves and may designate any person, persons,
partnership, corporation or combination thereof to carry out any of their duties
and responsibilities with respect to administration of the Plan. Any such
allocation or designation shall be reduced to writing and such writing shall be
kept with the records of the meetings of the Committee. Any action made or taken
by such a delegate may be appealed by any affected Participant to the Committee
in accordance with the claims review procedures provided in Section 11.2.
(g) The Committee may act at a meeting, or by writing without
a meeting, by the vote or written assent of a majority of its members. The
Committee shall elect one of its members as Secretary and keep the Trustee
advised of the identity of the member holding that office. The Secretary shall
keep records of all meetings of the Committee and forward all necessary
communications to the Trustee. The Committee may adopt such rules and procedures
as it deems desirable for the conduct of its affairs and the administration of
the Plan, provided that any such rules and procedures shall be consistent with
the provisions of the Plan and ERISA.
(h) The members of the Committee, and each of them, shall
discharge their duties with respect to the Plan (i) solely in the interest of
the Participants and Beneficiaries, (ii) for the exclusive purpose of providing
benefits to Employees participating in the Plan and their Beneficiaries and of
defraying reasonable expenses of administering the Plan and (iii) with the care,
skill, prudence, and diligence under the circumstances then prevailing that a
prudent man acting in a like capacity and familiar with such matters would use
in the conduct of an enterprise of a like character and with like aims. The
Employers
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hereby jointly and severally indemnify the members of the Committee and each of
them (and any of their delegates pursuant to (f) above who are employees of the
Company) from the effects and consequences of their acts, omissions and conduct
in their official capacity, except to the extent that such effects and
consequences shall result from their own willful misconduct.
(i) No member of the Committee shall receive any compensation
or fee for his services unless otherwise agreed between such member of the
Committee and the Company, but the Company shall reimburse the Committee members
for any necessary expenditures incurred in the discharge of their duties as
Committee members.
(j) The Committee may employ such counsel (who may be of
counsel for any Employer) and agents and may arrange for such clerical and other
services as it may require in carrying out the provisions of the Plan.
(k) Subject to approval by the board of directors of the
Company, the Committee shall have the responsibility and authority to appoint
one or more investment advisors and to set the investment objectives and
parameters for the Plan.
Section 11.2. Claims Procedure. If any Participant or
Distributee (a "claimant") believes he is entitled to benefits in an amount
greater than those which he is receiving or has received, he may file a claim
with the Secretary of the Committee. Such a claim shall be in writing and state
the nature of the claim, the facts supporting the claim, the amount claimed, and
the address of the claimant. The Secretary of the Committee
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shall review the claim and, unless special circumstances require an extension of
time, within 90 days after receipt of the claim, give written notice by
registered or certified mail to the claimant of his decision with respect to the
claim. If special circumstances require an extension of time, the claimant shall
be so advised in writing within the initial 90-day period and in no event shall
such an extension exceed 90 days. The notice of the decision of the Secretary of
the Committee with respect to the claim shall be written in a manner calculated
to be understood by the claimant and, if the claim is wholly or partially
denied, set forth the specific reasons for the denial, specific references to
the pertinent Plan provisions on which the denial is based, a description of any
additional material or information necessary for the claimant to perfect the
claim and an explanation of why such material or information is necessary. The
Secretary of the Committee shall also advise the claimant that he or his duly
authorized representative may request a review by the entire Committee of the
denial by filing with the Secretary of the Committee within 65 days after notice
of the denial has been received by the claimant, a written request for such
review. The claimant shall be informed that he may have reasonable access to
pertinent documents and submit comments in writing to the Secretary of the
Committee within the same 65-day period. If a request is so filed, review of the
denial shall be made by the Committee within, unless special circumstances
require an extension of time, 60 days after receipt of such request, and the
claimant shall be given written notice of the resulting final decision. If
special circumstances require an extension of time, the claimant shall be so
advised in writing within the initial 60-day period and in no event shall such
an extension exceed 60 days. The notice of the final decision shall include
specific reasons for the decision and specific references to the pertinent Plan
provisions on which the decision is based and shall be written in a manner
calculated to be understood by the claimant.
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Section 11.3. Procedures for Domestic Relations Orders. If the
Committee receives any written judgment, decree or order (including approval of
a property settlement agreement) pursuant to State domestic relations or
community property law relating to the provision of child support, alimony or
marital property rights of a spouse, former spouse, child or other dependent of
a Participant and purporting to provide for the payment of all or a portion of
the Participant's account balances under the Plan to or on behalf of one or more
of such persons (such judgment, decree or order being hereinafter called a
"domestic relations order"), the Secretary of the Committee shall promptly
notify the Participant and each other payee specified in such domestic relations
order of its receipt and of the following procedures. After receipt of a
domestic relations order, the Secretary shall determine whether such order
constitutes a "qualified domestic relations order," as defined in paragraph (b)
of Section 14.2, and shall notify the Participant and each payee named in such
order in writing of its determination. Such notice shall be written in a manner
calculated to be understood by the parties and shall set forth specific reasons
for the Secretary's determination, and shall contain an explanation of the
review procedure under the Plan. The Secretary shall also advise each party that
he or his duly authorized representative may request a review by the Committee
of the Secretary's determination by filing with the Secretary a written request
for such review. The Secretary shall give each party affected by such request
notice of such request for review. Each party also shall be informed that he may
have reasonable access to pertinent documents and submit comments in writing to
the Secretary in connection with such request for review. Each party shall be
given written notice of the Committee's final determination, which notice shall
be written in a manner calculated to be understood by the parties and shall
include specific reasons for such final determination. If within a reasonable
time after receipt of written
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evidence of such order, it is determined that such domestic order constitutes a
qualified domestic relations order, amounts subject to a domestic relations
order which are payable to the alternate payee shall be segregated in a separate
account and distributed in accordance with the terms of the order. If within
such reasonable period of time it is determined that such order does not
constitute a qualified domestic relations order, the amounts so segregated (plus
any interest thereon) shall be paid to the Participant or such other persons, if
any, entitled to such amounts at such time. Any determination regarding the
status of such order after such reasonable time period shall be applied only to
payments on or after the date of such determination. Prior to the issuance of
regulations, the Committee shall establish the time periods in which the
Secretary's determination, a request for review thereof and the review by the
Committee shall be made, provided that the total of such time periods shall not
be longer than 18 months from the date written evidence of a domestic relations
order is received by the Committee. The duties of the Secretary of the Committee
under this Section may be delegated by the Secretary to one or more persons
other than the Secretary.
Section 11.4. Notices to Participants, Etc. All notices,
reports and statements given, made, delivered or transmitted to a Participant or
Distributee or any other person entitled to or claiming benefits under the Plan
shall be deemed to have been duly given, made or transmitted when mailed by
first class mail with postage prepaid and addressed to the Participant or
Distributee or such other person at the address last appearing on the records of
the Committee. A Participant or Distributee or other person may record any
change of his address from time to time by written notice filed with the
Committee.
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Section 11.5. Notices to Company, Employers or Committee.
Written directions, notices and other communications from Participants or
Distributees or any other person entitled to or claiming benefits under the Plan
to the Company, Employers or the Committee shall be deemed to have been duly
given, made or transmitted either when delivered to such location as shall be
specified upon the form prescribed by the Committee for the giving of such
directions, notices and other communications or when mailed by first class mail
with postage prepaid and addressed to the addressee at the address specified
upon such forms.
Section 11.6. Records. The Committee shall keep a record of
all of its proceedings and shall keep or cause to be kept all books of account,
records and other data as may be necessary or advisable in its judgment for the
administration of the Plan.
Section 11.7. Reports of Accounting to Participants. The
Committee shall keep on file, in such form as it shall deem convenient and
proper, all reports concerning the Trust Fund and the Committee shall, as soon
as possible after the close of each Plan Year, advise each Participant and
Distributee of the balance credited to any account for his benefit as of the
close of such Plan Year pursuant to Article 7 hereof.
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ARTICLE 12
PARTICIPATION BY OTHER EMPLOYERS
Section 12.1. Adoption of Plan. With the consent of the
Company, any entity may become a participating Employer under the Plan by (a)
taking such action as shall be necessary to adopt the Plan, (b) becoming a party
to the agreement establishing the Trust and (c) executing and delivering such
instruments and taking such other action as may be necessary or desirable to put
the Plan into effect with respect to such entity.
Section 12.2. Withdrawal from Participation. Any Employer may
withdraw from participation in the Plan at any time by filing with the Secretary
of the Company a duly certified copy of a resolution of its board of directors
duly adopted by the Employer to that effect and giving notice of its intended
withdrawal to the Company, the other Employers and the Trustee prior to the
effective date of withdrawal.
Section 12.3. Company and Committee as Agent for Employers.
Each entity which shall become a participating Employer pursuant to Section 12.1
or Article 13 by so doing shall be deemed to have appointed the Company and the
Committee its agent to exercise on its behalf all of the powers and authorities
hereby conferred upon the Company and the Committee by the terms of the Plan,
including, but not by way of limitation, the power of the Company to amend and
terminate the Plan. The authority of the Company and the Committee to act as
such agent shall continue unless and until the portion of the Trust for the
benefit of Employees of the particular Employer and their Beneficiaries is
provided for as described in Section 16.2.
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ARTICLE 13
CONTINUANCE BY A SUCCESSOR
In the event that the Employer is reorganized by way of
merger, consolidation, transfer of assets or otherwise, so that another entity
succeeds to all or substantially all of the Employer's business, such successor
entity may be substituted for the Employer under the Plan by adopting the Plan
and becoming a party to the Trust agreement; provided, however, that the board
of directors of the Company may take action to provide that such successor
entity may not be substituted for the Employer. Contributions by the Employer
shall be automatically suspended from the effective date of any such
reorganization until the date upon which the substitution of such successor
entity for the Employer under the Plan becomes effective. If, within 90 days
following the effective date of any such reorganization, such successor entity
shall not have elected to become a party to the Plan, or if the Employer adopts
a plan of complete liquidation other than in connection with a reorganization,
the Plan shall be automatically terminated with respect to Employees of such
Employer as of the close of business on the 90th day following the effective
date of such reorganization or as of the close of business on the date of
adoption of such plan of complete liquidation, as the case may be, and the
Company shall direct the Trustee to distribute the portion of the Trust Fund
applicable to such Employer in the manner provided in Section 16.4.
If such successor entity is substituted for an Employer, by
electing to become a party to the Plan as described above, then, for all
purposes of the Plan, employment of such Employee with such Employer, including
service with and compensation paid by such Employer, shall be considered to be
employment with such Employer.
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ARTICLE 14
MISCELLANEOUS
Section 14.1. Expenses. All costs and expenses incurred in
administering the Plan and the Trust, including the fees of counsel and any
agents for the Company and Committee, the fees and expenses of Trustee, the fees
of counsel for the Trustee and other administrative expenses shall be paid from
the Trust Fund to the extent not paid by the Company or the Employers, provided,
however, that any loan-processing fees assessed in accordance with Section
8.9(b)(7) shall be paid by the Participant requesting the loan. The Company, in
its sole discretion, shall determine the portion of each expense which is to be
borne by a particular Employer.
Section 14.2. Non-Assignability. (a) In general. It is a
condition of the Plan, and all rights of each Participant and Distributee shall
be subject thereto, that no right or interest of any Participant or Distributee
in the Plan shall be assignable or transferable in whole or in part, either
directly or by operation of law or otherwise, including, but not by way of
limitation, execution, levy, garnishment, attachment, pledge or bankruptcy, but
excluding devolution by death or mental incompetency, and no right or interest
of any Participant or Distributee in the Plan shall be liable for, or subject
to, any obligation or liability of such Participant or Distributee, including
claims for alimony or the support of any spouse.
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(b) Exception for Qualified Domestic Relations Orders.
Notwithstanding any provision of the Plan to the contrary, if a Participant's
account balance under the Plan, or any portion thereof, is the subject of one or
more qualified domestic relations orders, as defined below, such account balance
or portion thereof shall be paid to the person and at the time and in the manner
specified in any such order. For purposes of this paragraph, "qualified domestic
relations order" shall mean any "domestic relations order" as defined in Section
11.3 which creates (or recognizes the existence of) or assigns to a person other
than the Participant (an "alternate payee") rights to all or a portion of the
Participant's account balance under the Plan, and:
(A) clearly specifies
(i) the name and last known mailing address (if any)
of the Participant and each alternate payee covered by such
order,
(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 to, or period of time
for which, such order applies, and
(iv) each plan to which such order applies;
(B) does not require
(i) the Plan to provide any type or form of benefit
or any option not otherwise provided under the Plan at the
time such order is issued,
(ii) the Plan to provide increased benefits
(determined on the basis of actuarial equivalence), and
(iii) the payment of benefits to an alternate payee
which at the time such order is issued already are required to
be paid to a different alternate payee under a prior qualified
domestic relations order;
all as determined by the Committee pursuant to the procedures contained in
Section 11.3.
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Section 14.3. Employment Non-Contractual. The Plan confers no
right upon an Employee to continue in employment.
Section 14.4. Limitation of Rights. A Participant or
Distributee shall have no right, title or claim in or to any specific asset of
the Trust Fund, but shall have the right only to distributions from the Trust on
the terms and conditions herein provided.
Section 14.5. Merger or Consolidation with Another Plan. A
merger or consolidation with, or transfer of assets or liabilities to, any other
plan shall not be effected unless the terms of such merger, consolidation or
transfer are such that each Participant, Distributee, Beneficiary or other
person entitled to receive benefits from the Plan would, if the Plan were to
terminate immediately after the merger, consolidation or transfer, receive a
benefit equal to or greater than the benefit such person would be entitled to
receive if the Plan were to terminate immediately before the merger,
consolidation, or transfer.
Section 14.6. Gender and Plurals. Wherever used in the Plan,
words in the masculine gender shall include masculine or feminine gender, and,
unless the context otherwise requires, words in the singular shall include the
plural, and words in the plural shall include the singular.
Section 14.7. Applicable Law. The Plan and all rights
hereunder shall be governed by and construed in accordance with the laws of the
State of Delaware to the extent such laws have not been preempted by applicable
federal law.
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Section 14.8. Severability. If a provision of the Plan shall
be held illegal or invalid, the illegality or invalidity shall not affect the
remaining parts of the Plan and the Plan shall be construed and enforced as if
the illegal or invalid provision had not been included in the Plan.
ARTICLE 15
TOP-HEAVY PLAN REQUIREMENTS
Section 15.1. Top-Heavy Plan Determination. The provisions of
this Article 15 shall be applied separately with respect to (i) the Company and
its Affiliates and (ii) each Nonaffiliate. If as of the determination date (as
defined in Section 15.2) for any Plan Year (a) the sum of the account balances
under the Plan and all other defined contribution plans in the aggregation group
(as defined in Section 15.2) and (b) the present value of accrued benefits under
all defined benefit plans in such aggregation group of all participants in such
plans who are key employees (as defined in Section 15.2) for such Plan Year
exceeds 60% of the aggregate of the account balances and present value of
accrued benefits of all participants in such plans as of the determination date,
then the Plan shall be a top-heavy plan for such Plan Year, and the requirements
of Sections 15.3, 15.4 and 15.5 shall be applicable for such Plan Year as of the
first day thereof. If the Plan shall be a top-heavy plan for any Plan Year and
not be a top-heavy plan for any subsequent Plan Year, the requirements of this
Article 15 shall not be applicable for such subsequent Plan Year except to the
extent provided in Section 15.4.
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Section 15.2. Definitions and Special Rules. (a) Definitions.
For purposes of this Article 15, the following definitions shall apply:
(1) Determination Date. The determination date for all plans
in the aggregation group shall be the last day of the preceding Plan
Year, and the valuation date applicable to a determination date shall
be (i) in the case of a defined contribution plan, the date as of which
account balances are determined which is coincident with or immediately
precedes the determination date, and (ii) in the case of a defined
benefit plan, the date as of which the most recent actuarial valuation
for the Plan Year which includes the determination date is prepared,
except that if any such plan specifies a different determination or
valuation date, such different date shall be used with respect to such
plan.
(2) Aggregation Group. The aggregation group shall consist of
(a) each plan of an Employer in which a key employee is a Participant,
(b) each other plan which enables such a plan to be qualified under
section 401(a) or section 410 of the Code, and (c) any other plans of
an Employer which the Employer shall designate as part of the
aggregation group and which shall permit the aggregation group to
continue to meet the requirements of sections 401(a) and 410 of the
Code with such other plan being taken into account.
(3) Key Employee. The term key employee shall have the meaning
set forth in section 416(i) of the Code.
(4) Compensation. Compensation shall have the meaning set
forth in Section 1.415-2(d) of the Regulations.
(b) Special Rules. For the purpose of determining the accrued
benefit or account balance of a participant, the accrued benefit or account
balance of any person who has not performed services for an Employer at any time
during the five-year period ending on the determination date shall not be taken
into account pursuant to this Section, and any person who received a
distribution from a plan (including a plan which has terminated) in the
aggregation group during the five-year period ending on the last day of the
preceding Plan Year shall be treated as a participant in such plan, and any such
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distribution shall be included in such participant's account balance or accrued
benefit, as the case may be.
Section 15.3. Minimum Contribution for Top-Heavy Years.
Notwithstanding any provision of the Plan to the contrary, the aggregate of the
Employer match contributions and the discretionary match contributions under
Article 4 allocated to the account of a Participant during any Plan Year (other
than to the account of a key employee) and the forfeitures allocated to the
account of a Participant during any Plan Year (other than to the account of a
key employee) for which the Plan is a top-heavy plan shall in no event be less
than the lesser of (i) 3 percent of such Participant's compensation during such
Plan Year and (ii) the highest percentage at which contributions are made on
behalf of any key employee for such Plan Year. Such minimum contribution shall
be made even if, under other provisions of the Plan, the Participant would not
otherwise be entitled to receive an allocation or would receive a lesser
allocation for the year because of (i) the Participant's failure to complete
1,000 Hours of Service, or (ii) compensation of less than a stated amount. If
during any Plan Year for which this Section is applicable a defined benefit plan
is included in the aggregation group and such defined benefit plan is a
top-heavy plan for such Plan Year, the percentage set forth in the clause (i)
above shall be 5 percent. The percentage referred to in clause (ii) of the first
sentence of this Section shall be obtained by dividing the aggregate of
contributions made pursuant to Article 4 and pursuant to any other defined
contribution plan which is required to be included in the aggregation group
(other than a defined contribution plan which enables a defined benefit plan
which is required to be included in such group to be qualified under section
401(a) of
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the Code) during the Plan Year on behalf of such key employee by such key
employee's compensation for the Plan Year.
Section 15.4. Top-Heavy Vesting Requirements. Notwithstanding
any provision of the Plan to the contrary, if a Participant's termination of
employment occurs during a Plan Year for which a plan is a top-heavy plan and
after the Participant shall have completed at least one Year of Service, the
Participant shall be entitled to receive that portion of his Employer match
account and Prior Plan Forfeitable Accounts (as applicable) determined by
multiplying each such account balance as determined under Article 8 by the
percentage set forth in the table below opposite the number of the Participant's
Years of Service.
Years of Service Percentage
---------------- ----------
Less than 3 0
3 or more 100
If a Participant's termination of employment occurs during a Plan Year for which
the Plan is not a top-heavy plan but after the Plan has been a top-heavy plan
for any Plan Year, such Participant shall be entitled to not less than the
balance of his Employer match account and Prior Plan Forfeitable Accounts (as
applicable) determined under Article 8 multiplied by the percentage set forth
above opposite the number of the Participant's Years of Service as of the end of
the last Plan Year for which the Plan was a top-heavy plan, and, if at such time
such Participant had completed at least three Years of Service, he shall be
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entitled to elect to have the portion of his account to which he is entitled
determined under this Section without regard to whether the Plan again becomes a
top-heavy plan.
Section 15.5. Special Rules for Applying Statutory Limitations
on Benefits.
(a) In any Plan Year for which the Plan is a top-heavy plan,
clause (A)(I) of the first paragraph of Section 7.6 shall be applied by
substituting "100%" for "125%" appearing therein unless for such Plan Year (i)
the percentage of account balances of Participants who are key employees
determined under Section 14.1 does not exceed 90%, and (ii) discretionary
contributions and forfeitures allocated to the accounts of Participants who are
not key employees equals at least 4% of the compensation of each such
Participant.
(b) In any Plan Year for which the Plan is a top-heavy plan,
clause (B)(I) of the first paragraph of Section 7.6 shall be applied by
substituting "100%" for "125%" appearing therein unless for any such Plan Year
(i) the percentage of accrued benefits of Participants who are key employees
does not exceed 90%, and (ii) the minimum accrued benefit of each Participant
under all defined benefit plans in the aggregation group is at least 3% of his
average compensation (determined under section 416(d) of the Code) multiplied by
each year of service after 1983, not in excess of 10, for which such plans are
top-heavy plans.
(c) If in any Plan Year for which the Plan is a top-heavy plan
a defined benefit plan is included in the aggregation group and such defined
benefit plan is a
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top-heavy plan for such Plan Year, clauses (A)(I) and (B)(I) of the first
paragraph of Section 7.6 shall be applied by substituting "100%" for "125%"
appearing therein.
ARTICLE 16
AMENDMENT, ESTABLISHMENT OF SEPARATE
PLAN AND TERMINATION
Section 16.1. Amendment or Termination. The Company may at any
time and from time to time amend or modify the Plan by resolution of the board
of directors of the Company (or a duly appointed delegate thereof). Any such
amendment or modification shall become effective on such date as the Company
shall determine, including retroactively to the extent permitted by law, and may
apply to Participants in the Plan at the time thereof as well as to future
Participants. By adoption of the Plan, each Nonaffiliate expressly delegates to
the board of directors of the Company (or a duly appointed delegate thereof)
sole authority to make amendments or modifications to the Plan as adopted and
maintained by such Nonaffiliate.
The Plan may be terminated with respect to the Company, its
Affiliates and all adopting Nonaffiliates on any date specified by the board of
directors of the Company. The Plan may be terminated solely with respect to the
Company and its Affiliates on any date specified by the board of directors of
the Company. The Plan may be terminated solely with respect to a Nonaffiliate on
any date specified by the board of directors of the Nonaffiliate (or by such
other person as may be required or permitted to act on behalf of such
Nonaffiliate), provided that such Nonaffiliate notifies the Committee of such
termination at least 30 days prior to the effective date of the termination.
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Section 16.2. Establishment of Separate Plan. If an Employer
shall withdraw from the Plan under Section 12.2 the Company shall determine the
portion of the Trust Fund held by the Trustee which is applicable to the
Participants and former Participants of such Employer and direct the Trustee to
segregate such portion in a separate Trust. Such separate Trust shall thereafter
be held and administered as a part of the separate plan of such Employer. The
portion of the Trust applicable to the Participants and former Participants of a
particular Employer shall be the sum of:
(a) the total amount credited to all accounts which are
applicable to the Participants and former Participants of such Employer
and
(b) an amount which bears the same ratio to the excess, if
any, of
(i) the total value of the Trust over
(ii) the total amount credited to all accounts
as the total amount credited to the accounts which are applicable to the
Participants and former Participants of such Employer bears to the total amount
credited to such accounts of all Participants and former Participants.
Section 16.3. Full Vesting upon Termination of Participation
or Partial Termination of the Plan. In the event that any Employer terminates
its participation in the Plan, or in the event of the partial termination of the
Plan, the accounts of all Participants of such Employer, or of those
Participants who are affected by the partial termination of the Plan, as the
case may be, shall become fully vested and shall not thereafter be subject to
forfeiture.
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Section 16.4. Distribution upon Termination of the Plan. Any
Employer may at any time terminate its participation in the Plan by written
instrument executed on behalf of the Employer by resolution of its board of
directors to that effect. In the event of any such termination the Company shall
determine the portion of the Trust Fund held by the Trustee which is applicable
to the Participants and former Participants of such Employer and direct the
Trustee to distribute such portion to Participants ratably in proportion to the
balances of their respective accounts as follows:
(a) The balance in any account shall be distributed to the
Distributee entitled to receive such account.
(b) The remaining assets of the Trust Fund shall be
distributed to Participants ratably in proportion to the balances of
their respective accounts.
A complete discontinuance of contributions by an Employer shall be deemed a
termination of such Employer's participation in the Plan for purposes of this
Section.
Section 16.5. Trust Fund to Be Applied Exclusively for
Participants and Their Beneficiaries. Subject only to the provisions of Section
4.5 and the provisions of Section 15.4 and any other provision of the Plan to
the contrary notwithstanding, it shall be impossible for any part of the Trust
Fund to be used for or diverted to any purpose not for the exclusive benefit of
Participants and their Beneficiaries either by operation or termination of the
Plan, power of amendment or other means.
IN WITNESS WHEREOF, the Company has adopted the Plan on this
____ day of ________, 1999.
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STARWOOD HOTELS & RESORTS
WORLDWIDE, INC.
By: ______________________________
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APPENDIX
SPECIAL PROVISIONS FOR CERTAIN PARTICIPANTS
Notwithstanding anything in the Plan to the contrary, the provisions of
this Appendix shall apply to the Participants described below:
A. Participation Service Counted Prior to Date the Company Acquired
the Hotel:
The following groups of Employees who became employees of the Company
as a result of an acquisition by the Company will be credited for participation
service prior to such acquisition as follows:
GROUP PARTICIPATION SERVICE
CREDIT
- Employees of the Radisson Service for the time period from January
Denver South 1, 1997 until January 17, 1997 (the
acquisition date) shall be credited
(provided such employee was employed by
the Radisson Denver South continuously
from January 1, 1997).
No past service credit will be given for
purposes of vesting.
- - Employees of the Deerfield Service for the time period from January
Beach Hilton 1, 1997 until January 8, 1997 (the
acquisition date) shall be credited
(provided such employee was employed by
the Deerfield Beach Hilton continuously
from January 1, 1997).
No past service credit will be given for
purposes of vesting.
- - Employees of Days Inn Service for the time period from
Lake Shore Drive February 21,1996 until February 21, 1997
(the acquisition date) for each Employee
who as of April 1,
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1997 (i) is an Eligible Employee, (ii)
has attained age 21; (iii) has been
continuously employed by the Days Inn
Lake Shore Drive from February 21, 1996
and (iv) who was credited with 1000
hours of service for the period from
February 21, 1996 until February 21,
1997.
Employees who do not meet the
requirements set forth above shall
nevertheless be given credit for service
for any time after February 21, 1996
that they were employed by the Days Inn
Lake Shore Drive provided such employee
was an employee of such hotel on
February 21, 1997.
No credit will be given for purposes of
vesting.
- - Employees of the Hermitage Service for the time period from March
Suite Hotel 11, 1996 until March 11, 1997 (the
acquisition date) for each Employee who
as of April 1, 1997 (i) is an Eligible
Employee, (ii) has attained age 21;
(iii) has been continuously employed by
the Hermitage Suite Hotel from March 11,
1996 and (iv) who was credited with 1000
hours of service for the period from
March 11, 1996 until March 11, 1997.
Employees who do not meet the
requirements set forth above shall
nevertheless be given credit for service
for any time after March 11, 1996 that
they were employed by the Hermitage
Suite Hotel provided such employee was
an employee of such hotel on March 11,
1997.
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<PAGE> 89
No credit will be given for purposes of
vesting.
- - Employees of the Hotel Service for the time period from March
De La Poste 13, 1996 until March 13, 1997 (the
acquisition date) for each Employee who
as of April 1, 1997 (i) is an Eligible
Employee, (ii) has attained age 21;
(iii) has been continuously employed by
the Hotel De La Poste from March 13,
1996 and (iv) who was credited with 1000
hours of service for the period from
March 13, 1996 until March 13, 1997.
Employees who do not meet the
requirements set forth above shall
nevertheless be given credit for service
for any time after March 13, 1996 that
they were employed by the Hotel De La
Poste provided such employee was an
employee of such hotel on March 13,
1997.
No credit will be given for purposes of
vesting.
- - Employees of each of the hotels listed below shall be given credit for
service for the one-year period prior to the hotel's Acquisition Date
for each Employee who as of the hotel's Acquisition Date (i) is an
Eligible Employee, (ii) has attained age 21; (iii) has been
continuously employed by the hotel for the one-year period prior to the
hotel's Acquisition Date and (iv) who was credited with 1000 hours of
service for the one-year period prior to the Acquisition Date.
Employees who do not meet the requirements set forth above shall
nevertheless be given credit for service for any time during the
one-year period prior to the hotel's Acquisition Date that they were
employed by the hotel provided such employee was an employee of such
hotel on the hotel's Acquisition Date.
No credit will be given for purposes of vesting.
Hotel Acquisition Date
----- ----------------
Marriott Suites San Diego April 3, 1997
Tremont Hotel April 4, 1997
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<PAGE> 90
Harvey's Wichita May 1, 1997
Raphael May 7, 1997
Sheraton Stamford June 12, 1997
Radisson Plaza Hotel at Town Center July 10, 1997
Atlanta Hilton NE August 1, 1997
Crowne Plaza (New Orleans) September 23, 1997
One Washington Circle (Washington, D.C.) September 29, 1997
Radisson Plaza & Suite Hotel October 31, 1997
(Indianapolis)
Tara's Ferncroft Conference Resort September 10, 1997
Sheraton Tara Hotel (Framingham) September 10, 1997
Tara's Cape Codder Hotel September 10, 1997
Tara Hyannis Hotel & Resort September 10, 1997
Sheraton Tara Lexington Inn September 10, 1997
Tara's Colonial Hilton September 10, 1997
Sheraton Tara Hotel (Newton) September 10, 1997
Sheraton Tara Hotel (South Portland) September 10, 1997
Tara Stamford Hotel September 10, 1997
Sheraton Tara Hotel (Braintree) September 10, 1997
Sheraton Tara WayFarer Inn September 10, 1997
Tara Merrimack Hotel September 10, 1997
Sheraton Tara Hotel (Nashua) September 10, 1997
Sheraton Tara Hotel (Warwick) September 10, 1997
Sheraton Tara Hotel (Parsippany) September 10, 1997
Sheraton Long Beach January 1, 1998
Sonoma County Hilton January 1, 1998
Ontario Airport Hilton January 1, 1998
Grand Junction Hilton January 1, 1998
Danbury Hilton & Towers January 1, 1998
Wilmington Hilton Hotel January 1, 1998
Northeast Atlanta Hilton January 1, 1998
BWI Airport Marriot January 1, 1998
Bethesda Ramada Hotel & January 1, 1998
Conference Center
Novi Hilton January 1, 1998
Holiday Inn Crowne Plaza Edison January 1, 1998
Long Island Sheraton January 1, 1998
Park Ridge at Valley Forge January 1, 1998
Charleston Hilton North January 1, 1998
Sheraton Gateway Houston Airport January 1, 1998
Courtway by Marriot Crystal City January 1, 1998
Omni Waterside Hotel January 1, 1998
Pavilion Towers Resort & January 1, 1998
Conference Center
B. Prior Service Counted for Certain Employees at Hotels with No Prior
Plan:
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<PAGE> 91
Each Eligible Employee (i) who was continuously employed for
the period between December 31, 1998 and April 1, 1999 at one of the hotel
properties listed below and (ii) who has attained age 21 by April 1, 1999 shall
become a Participant as of April 1, 1999, regardless of whether such Eligible
Employee has completed a Year of Service. For purposes of eligibility, each
Eligible Employee who became employed at one of the hotel properties listed
below after December 31, 1998 shall be credited with 45 Hours of Service for (i)
each week of employment for the period between his hire date and April 1, 1999
and (ii) such other service required to be included pursuant to Section 9.2. For
purposes of vesting, each Eligible Employee who is employed at one of the hotel
properties listed below on April 1, 1999 shall be credited with 45 Hours of
Service for (i) each week of employment since his most recent date of hire with
such hotel property or (ii) such other service required to included pursuant to
Section 9.2:
Sheraton Suites Alexandria
Sheraton Suites Columbus
Sheraton Suites Country Club Plaza
Sheraton Suites Elk Grove
Sheraton Suites Fairplex-Pomona
Sheraton Suites Market Center Dallas
Sheraton Suites Plantation
Sheraton Suites Wilmington
Galleria-Atlanta
Key West
Gateway O-Hare
St. Regis Aspen
Houston Luxury Collection
Westin Central Park South
Washington D.C. Luxury Collection
Sheraton Perimeter Park South Hotel
Sheraton Burlington Hotel & Conference Center
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<PAGE> 1
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this registration statement on
Form S-8 of our report dated February 27, 1998, on our audits of the financial
statements and financial statement schedules appearing in the Joint Annual
Report of Starwood Hotels & Resorts (formerly Starwood Lodging Trust) and
Starwood Hotels & Resorts Worldwide, Inc. (formerly Starwood Lodging
Corporation) on Form 10-K.
PRICEWATERHOUSECOOPERS LLP
Phoenix, AZ
March 4, 1999
<PAGE> 1
Exhibit 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this Registration Statement on Form S-3 of our report dated
February 12, 1998 on the consolidated financial statements and financial
statement schedule of ITT Corporation, and our report dated March 11, 1998 on
the combined financial statements of Westin Hotels & Resorts Worldwide, Inc.,
the consolidated financial statements of W&S Hotel L.L.C., and the combined
financial statements of the predecessor business included in Starwood Hotels &
Resorts and Starwood Hotels & Resorts Worldwide, Inc. Joint Current Report on
Form 8-K dated February 23, 1998 and to all references to our Firm included in
this Registration Statement.
ARTHUR ANDERSEN LLP
New York, New York
March 5, 1999
