JAMES RIVER CORP OF VIRGINIA, DEF 14A, 1994-03-14

JAMES RIVER CORP OF VIRGINIA
DEF 14A, 1994-03-14
PAPER MILLS

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<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934
Filed by the Registrant (X)
Filed by a Party other than the Registrant ( )
Check the appropriate box:
( ) Preliminary Proxy Statement
(X) Definitive Proxy Statement
( ) Definitive Additional Materials
( ) Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
James River Corporation of Virginia
(Name of Registrant as Specified in its Charter)
James River Corporation of Virginia
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
(X) $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
( ) $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
( ) Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1) Title of each class of securities to which transaction applies:
2) Aggregate number of securities to which transaction applies:
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
4) Proposed maximum aggregate value of transaction:
( ) Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
1) Amount Previously Paid:
2) Form, Schedule, or Registration Statement No.:
3) Filing Party:
4) Date Filed:

<PAGE>
JAMES RIVER CORPORATION OF VIRGINIA
March 14, 1994
Dear Shareholder:
It is our pleasure to invite you to the Annual Meeting of Shareholders of
James River Corporation of Virginia to be held at 4:00 p.m. (Eastern daylight
time) on Thursday, April 28, 1994, at TheatreVirginia at the Virginia Museum of
Fine Arts, 2800 Grove Avenue, Richmond, Virginia. A Notice of this Annual
Meeting and a Proxy Statement covering the formal business of the meeting are
enclosed, along with the Company's Annual Report to Shareholders for the fiscal
year ended December 26, 1993. During the meeting, time will be provided for a
review of operations for the past year and items of general interest about the
Company.
It is important that your shares be represented at the meeting whether or
not you expect to attend; therefore, please promptly sign, date, and return the
proxy card in the accompanying postage-paid envelope. Even though you execute
this proxy, you may revoke it at any time before it is voted. If you attend the
meeting, you will be able to vote in person if you wish to do so, even if you
have previously returned your proxy card.
We look forward to seeing you at the Annual Meeting.
Sincerely,
Robert C. Williams
CHAIRMAN, PRESIDENT, AND
CHIEF EXECUTIVE OFFICER

<PAGE>

JAMES RIVER CORPORATION
OF VIRGINIA
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON APRIL 28, 1994
TO THE SHAREHOLDERS OF
JAMES RIVER CORPORATION OF VIRGINIA
Notice is hereby given that the Annual Meeting of Shareholders of James
River Corporation of Virginia (the "Company") will be held at 4:00 p.m. on
Thursday, April 28, 1994, at TheatreVirginia at the Virginia Museum of Fine
Arts, 2800 Grove Avenue, Richmond, Virginia, for the following purposes:
1. To elect a Board of Directors consisting of ten (10) persons to serve
for the ensuing year;
2. To approve the appointment of Coopers & Lybrand as the Company's
independent accountants for the fiscal year ending December 25, 1994;
3. To consider and vote upon a proposal to amend and restate the Company's
Stock Purchase Plan;
4. To consider and vote upon a proposal to amend and restate the Company's
1987 Stock Option Plan;
5. To consider and vote upon a proposal to amend and restate the Company's
Deferred Stock Plan;
6. To consider and vote upon a proposal to adopt the Company's 1993 Profit
Sharing Plan for Salaried Employees;
7. To consider and vote upon a proposal submitted by certain shareholders
concerning the MacBride Principles, if presented; and
8. To transact such other business as may properly come before the
meeting.
The close of business on February 17, 1994, has been fixed as the record
date to determine the shareholders entitled to vote at the Annual Meeting.
IT IS IMPORTANT THAT YOUR SHARES BE REPRESENTED AND VOTED. Shareholders,
whether or not they expect to attend the meeting in person, are requested to
date, sign, and return the enclosed proxy card in the envelope provided, on
which no postage is needed if mailed in the United States.
A copy of the Company's Annual Report to Shareholders for the fiscal year
ended December 26, 1993, is being mailed to you with this Notice and the Proxy
Statement.
You are cordially invited to attend the meeting.
By order of the Board of Directors,
CLIFFORD A. CUTCHINS, IV
CORPORATE SECRETARY
March 14, 1994

<PAGE>
JAMES RIVER CORPORATION
OF VIRGINIA
P. O. BOX 2218
RICHMOND, VIRGINIA 23217
PROXY STATEMENT
GENERAL INFORMATION
This Proxy Statement, which is being mailed to shareholders on or about
March 14, 1994, is furnished in connection with the solicitation by the Board of
Directors of James River Corporation of Virginia ("James River" or the
"Company") of proxies in the form accompanying this Proxy Statement to be voted
at the Annual Meeting of Shareholders to be held at 4:00 p.m. on April 28,
1994, at TheatreVirginia at the Virginia Museum of Fine Arts, 2800 Grove
Avenue, Richmond, Virginia, and any adjournment thereof.
On February 17, 1994, there were 81,630,635 shares of common stock, par
value $.10 per share ("Common Stock"), outstanding. Only shareholders of record
of Common Stock at the close of business on February 17, 1994, will be entitled
to receive notice of, and to vote at, the Annual Meeting and any adjournment
thereof. Each share of Common Stock is entitled to one vote on each matter
presented to the shareholders. The Common Stock represented by each properly
executed proxy will be voted in the manner specified by the shareholder. If no
specific instruction is received, a proxy, when executed and not revoked, will
be voted FOR the election of the nominated directors; FOR the approval of
Coopers & Lybrand as the Company's independent accountants for the fiscal year
ending December 25, 1994; FOR the amendment and restatement of the Company's
Stock Purchase Plan, 1987 Stock Option Plan, and Deferred Stock Plan; FOR the
adoption of the 1993 Profit Sharing Plan for Salaried Employees; and AGAINST the
shareholder-submitted proposal. Shares for which the holder has elected to
abstain or to withhold the proxies' authority to vote (including broker
non-votes) on a matter will count toward a quorum but will have no effect on the
action taken other than the proposal to amend and restate the Company's Stock
Purchase Plan. With respect to this proposal, an abstention or withholding of
authority to vote will have the effect of a vote against the proposal. Execution
of the accompanying proxy will not affect a shareholder's right to attend the
Annual Meeting and vote in person. Any shareholder giving a proxy has the right
to revoke it at any time before it is voted by submitting written notice of
revocation or a new proxy.
The cost of solicitation of proxies will be borne by the Company.
Solicitation will be made initially by mail; however, the directors, officers,
and employees of the Company and its subsidiaries may, without additional
compensation, solicit proxies by telephone, telegraph, or personal interview.
The Company has engaged Georgeson & Company Inc. to solicit proxies from
brokers, banks, and other institutional holders at an estimated fee of
approximately $8,000 plus reimbursable expenses.
ELECTION OF DIRECTORS
The Bylaws of the Company provide for a Board of Directors (the "Board")
consisting of ten members effective April 28, 1994. Each of the directors will
serve for a term which will run until the next annual meeting of shareholders or
until his or her successor has been elected. W.J. Bowen, Richard H. Catlett,
Jr., and William S. Woodside, who have served as directors since 1986, 1969, and
1982, respectively, and have reached the retirement age for directors, will not
stand for re-election to the Board of Directors in 1994. Each of the nominees
listed below has been nominated by the Nominating Committee for re-election,
except for Anne Marie Whittemore, who is a new nominee in 1994.
Although the Company anticipates that all of the nominees will be able to
serve, if at the time of the meeting any nominees are unable or unwilling to
serve, shares represented by properly executed proxies will be voted at the
discretion of the persons named therein for such other person or persons as the
Board of Directors may designate.
1

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INFORMATION ON NOMINEES
<TABLE>
<CAPTION>
DIRECTOR BUSINESS EXPERIENCE AND DIRECTORSHIPS
NAME AGE PRINCIPAL OCCUPATION SINCE IN OTHER PUBLIC COMPANIES
<S> <C> <C> <C> <C>
FitzGerald Bemiss(1) 71 Private Investor, Richmond, Virginia 1972 Has held present position for more
than five years. Retired from man-
agement consulting in 1992.
William T. Burgin(1) 50 Partner, Bessemer Venture Partners, 1978 Has held present position for more
Wellesley Hills, Massachusetts than five years. Director of Galileo
Electro-Optics Corporation.
Worley H. Clark, Jr. 61 Chairman and Chief Executive Officer, 1993 Has held present position for more
Nalco Chemical Company, Naperville, than five years. Director of NICOR
Illinois (specialty chemicals company) Inc., Northern Trust Corporation, USG
Corporation, and Bethlehem Steel
Corporation.
William T. Comfort, Jr. 56 Chairman, Citicorp Venture Capital, 1978 Has held present position for more
Ltd. and Court Square Capital Ltd., than five years.
New York, New York (subsidiaries of
Citibank, N.A. and Citicorp)
William V. Daniel 65 Managing Director, WFS Financial 1969 Has held present position for more
Corporation, Richmond, Virginia (in- than five years.
vestment banking and financial ser-
vices)
Bruce C. Gottwald 60 Chairman and Chief Executive Officer, 1972 From May 1992 to March 1994, served as
Ethyl Corporation, Richmond, Virginia President and Chief Executive Officer
(petroleum additives and of Ethyl Corporation. Prior to May
pharmaceutical business) 1992, served as President and Chief
Operating Officer of Ethyl
Corporation. Director of Albemarle
Corporation, Dominion Resources, Inc.,
CSX Corporation, Tredegar Industries,
Inc., and First Colony Corporation.
Robert M. O'Neil 59 Director, The Thomas Jefferson Center 1987 Has held present position since Au-
for the Protection of Free Ex- gust 1990; prior to that time, served
pression, Charlottesville, Virginia as President of the University of Vir-
ginia for the period 1985-1990.
Joseph T. Piemont 70 Management Consultant, Charlotte, 1975 Has held present position for more
North Carolina than five years.
Anne Marie Whittemore(2) 47 Partner, McGuire, Woods, Battle & -- Has held present position for more
Boothe, Richmond, Virginia (attor- than five years. Director of Owens &
neys-at-law) Minor, Inc. and USF&G Corpora-
tion.
Robert C. Williams(1) 64 Chairman, President, and Chief Ex- 1969 Has held present position since Au-
ecutive Officer of the Company gust 1992; became Chief Executive
Officer in November 1990; prior to
that time, served as President and
Chief Operating Officer of the Com-
pany. Director of NationsBank of
Virginia, N.A.
</TABLE>

(1) Member of the Executive Committee.
(2) McGuire, Woods, Battle & Boothe serves as primary outside legal counsel to
the Company.
2

<PAGE>
VOTE REQUIRED
For the election of directors, the ten nominees receiving the greatest
number of affirmative votes cast at the Annual Meeting of Shareholders will be
elected.
BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors met on six occasions during 1993. All members of the
Board, except for Mr. Woodside, attended at least seventy-five percent, in the
aggregate, of the meetings of the Board and committees on which they served.
During 1993, the Company's Board of Directors was reorganized into three
groups -- Governance, Finance, and Operations. This reorganization was designed
to provide for deeper individual involvement and understanding of all aspects of
the Company's business and to increase each Board member's contributions and
effectiveness. Each group reviews and recommends actions, within their
applicable areas, for consideration and approval by the full membership of the
Board. The Governance and Finance Groups also include certain interrelated
committee functions.
The Governance Group, whose members were FitzGerald Bemiss (Group
Chairman), William T. Burgin, Worley H. Clark, Jr., and Robert C. Williams,
directs the overall organization and structure of the Company and its
businesses, performance and compensation matters, and nomination and succession
planning. Within the Governance Group is the Compensation Committee, whose
members were FitzGerald Bemiss (Committee Chairman), William T. Burgin, and
Worley H. Clark, Jr. The Compensation Committee, which met on four occasions
during 1993, including two meetings held by telephone, consists of only
non-employee directors and is responsible for recommending the salaries and
compensation programs for executive officers to the Board of Directors. This
committee is also responsible for administering the Company's profit sharing
plan for salaried employees, its stock option plans, and other benefit programs.
None of the members of the Compensation Committee is entitled to participate in
any of the Company's employee benefit plans.
Also within the Governance Group is the Nominating Committee, whose members
were FitzGerald Bemiss (Committee Chairman), William T. Burgin, Worley H. Clark,
Jr., and Robert C. Williams. The Nominating Committee recommends to the Board of
Directors the candidates for election as directors of the Company. The Board of
Directors also considers candidates recommended by shareholders entitled to vote
for the election of directors. Shareholder recommendations (including the
nominee's name, biographical data, and written consent to serve as a director if
elected) should be submitted to the Corporate Secretary of the Company.
The Finance Group, whose members were William T. Comfort, Jr. (Group
Chairman), Richard H. Catlett, Jr., William V. Daniel, and Robert M. O'Neil, is
responsible for overseeing internal controls and audit functions, financial
strategy and financing plans, and acquisitions and divestitures. Within the
Finance Group is the Audit Committee, whose members were William T. Comfort, Jr.
(Committee Chairman), William V. Daniel, and Robert M. O'Neil. The Audit
Committee, which met on three occasions during 1993, consists of only
non-employee directors. Throughout the year, the Audit Committee meets
periodically with management, members of the Company's internal audit staff, and
representatives of the Company's independent accountants. The Audit Committee
reviews the scope of internal and external audit activities and the results of
such audits and is responsible for making the annual recommendation to the Board
of Directors of the firm of independent accountants to be retained by the
Company.
The Operations Group, whose members were Bruce C. Gottwald (Group
Chairman), W.J. Bowen, Joseph T. Piemont, and William S. Woodside, reviews
operating and strategic planning, total quality implementation, product and
process improvements, and labor relations.
COMPENSATION OF DIRECTORS
Each director, other than Mr. Williams, received an annual fee of $25,000
for serving as a director, plus reimbursement of expenses incurred in connection
with attending meetings. In addition, under the current Board organization, each
director, other than Mr. Williams, received a fee of $1,000 for each Board
meeting attended, $2,000 for each Group meeting attended, $1,000 for each
Committee meeting if held separately from a Group meeting, and $600 for
participating in each meeting held by telephone. Directors who are employees of
the Company do not receive any additional compensation for membership on, or
attending meetings of, the Board of Directors or its groups or committees. In
1993, Mr. Bemiss received $11,255 for his services as a director of Jamont
Holdings N.V., a pan-European consumer products joint venture in which James
River has a 50% interest.
3

<PAGE>
Effective as of May 1, 1983, the Company adopted the Deferred Compensation
Plan for Outside Directors under which each non-employee director may elect to
defer not less than $10,000 of his annual director's fees for a period of at
least four years. Since the adoption of the plan, there have been several
amendments which primarily provide for additional four-year deferral periods.
The plan is administered by a committee whose members may, but need not, be
directors and whose members may not be participants in the plan. The Company
used the deferred directors' fees to purchase life insurance policies on the
directors' lives and, in each case, agreed to make deferred payments which, in
the aggregate, were intended at the time the policy was purchased to be
generally equal, on an after-tax basis, to the proceeds of the policy. The plan
provides participating directors with benefits according to schedules set forth
in the plan or in individual agreements between the Company and each director.
The minimum benefit that a director will earn is a return of his deferred fees,
plus interest accrued at the six-month certificate of deposit rate in effect
from time to time. Under the plan, the Company will pay the deferred benefits
beginning on dates selected by the participants at the time the deferral
elections are made and will pay death benefits to the beneficiary of a
participant who dies before beginning to receive the deferred benefits. Benefits
under the plan will be paid over a ten-year period, unless the aforementioned
committee directs otherwise. The plan participants are unsecured creditors of
the Company and have no right to any specific assets of the Company.
STOCK OPTION PLAN FOR OUTSIDE DIRECTORS
The Company adopted the Stock Option Plan for Outside Directors in June
1989 and amended and restated the plan as of April 11, 1991. The plan, which
operates automatically according to its terms, provides for the grant of
non-statutory options with terms of ten years to directors of the Company who
are not full-time employees of the Company or a subsidiary ("Outside Director").
The Board of Directors is responsible for the plan's implementation but may not
exercise any discretion concerning its administration. The plan provides for an
initial grant of stock options for 3,000 shares of Common Stock to each person
who first becomes a member of the Board of Directors as an Outside Director
after June 8, 1989. The plan also provides for the grant of an option to
purchase 1,000 shares of Common Stock as of each April 15th to each Outside
Director who has been an Outside Director for at least nine months. All options
under the plan are granted at exercise prices equal to the fair market value of
the Common Stock on the date of grant and are exercisable immediately.
RETIREMENT PLAN FOR OUTSIDE DIRECTORS
The Company adopted a Retirement Plan for Outside Directors effective as of
December 16, 1993, and amended the plan on February 18, 1994. The plan will
provide benefits for Outside Directors who complete at least five years of
eligible service. Eligible service is service as an Outside Director and service
as a director of a predecessor company. An Outside Director who meets these
requirements will receive an annual retirement benefit from the Company
beginning on the later of (i) the date on which the Outside Director attains age
65 or (ii) the date on which the Outside Director ceases to be a director. The
annual benefit will be equal to the annual retainer in effect on the date the
Outside Director ceases to be a director. The annual benefit will be paid for a
period of years equal to the lesser of (i) the Outside Director's period of
eligible service or (ii) ten years. An Outside Director may elect to have the
retirement benefit paid as a joint and 50% survivor form of payment during such
period. The plan is unfunded, and the Outside Directors are unsecured creditors
of the Company.
4

<PAGE>
STOCK OWNERSHIP OF MANAGEMENT
The following table lists the number of shares of Common Stock beneficially
owned by each director, certain executive officers, and all directors and
executive officers as a group as of February 17, 1994. No directors or executive
officers held any shares of preferred stock of the Company as of that date.
<TABLE>
<CAPTION>
NUMBER OF SHARES PERCENT OF
NAME BENEFICIALLY OWNED (1) CLASS (10)
<S> <C> <C>
Directors:
FitzGerald Bemiss..................................................... 48,412 *
W.J. Bowen............................................................ 11,000 *
William T. Burgin..................................................... 57,950(2) *
Richard H. Catlett, Jr................................................ 29,750 *
Worley H. Clark, Jr................................................... 5,000 *
William T. Comfort, Jr................................................ 9,000 *
William V. Daniel..................................................... 6,888(3) *
Bruce C. Gottwald..................................................... 256,000 *
Robert M. O'Neil...................................................... 6,300 *
Joseph T. Piemont..................................................... 6,800 *
Anne M. Whittemore.................................................... 0 *
Robert C. Williams.................................................... 929,168(4) 1.1 %
William S. Woodside................................................... 7,000 *
Other Named Executive Officers:
Ronald B. Estridge.................................................... 119,399(5) *
James K. Goodwin...................................................... 30,047(6) *
Ernest S. Leopold..................................................... 160,943(7) *
Norman K. Ryan........................................................ 161,867(8) *
All directors and executive officers as a group (24 persons)............ 2,229,670(9) 2.7 %
</TABLE>

* Less than 1% of Class.
(1) Each person has sole voting and investment power over all of the shares
listed, except as set forth below. The number of shares for each director
(except Mr. Clark, Ms. Whittemore, and Mr. Williams) includes 6,000 shares
that may be acquired within 60 days through the exercise of stock options.
Mr. Clark's beneficial ownership includes 3,000 shares that may be acquired
within 60 days through the exercise of stock options.
(2) Includes 3,000 shares held by his wife as custodian for their children as to
which he disclaims any beneficial interest.
(3) Includes 84 shares held by his wife for which voting and investment power is
shared.
(4) Includes 381,664 shares that may be acquired within 60 days through the
exercise of stock options, 34,894 shares held in the Stock Purchase Plan,
and 20,970 shares held by his wife for which voting and investment power is
shared.
(5) Includes 94,801 shares that may be acquired within 60 days through the
exercise of stock options and 325 shares held by his wife for which voting
and investment power is shared.
(6) Includes 24,367 shares that may be acquired within 60 days through the
exercise of stock options, 2,199 shares held in the Stock Purchase Plan, and
600 shares held by his wife and children for which voting and investment
power is shared.
(7) Includes 152,067 shares that may be acquired within 60 days through the
exercise of stock options, 153 shares held in the Stock Purchase Plan, 3,170
shares held in the James River II Salaried Employees Retirement Savings
Plan, and 4,345 shares held in trust for which voting and investment power
is shared.
(8) Includes 136,739 shares that may be acquired within 60 days through the
exercise of stock options, 10,427 shares held in the Stock Purchase Plan,
and 180 shares held in trust for which voting and investment power is
shared.
(9) Includes 1,102,998 shares that may be acquired within 60 days through the
exercise of stock options, 74,645 shares held in the Stock Purchase Plan,
3,414 shares held in the James River II Salaried Employees Retirement
Savings Plan, and 50,743 shares held in trust or by spouses and children for
which voting and investment power is shared.
(10) Any Common Stock not outstanding but which can be acquired through the
exercise of options within 60 days by a shareholder named in the table is
deemed outstanding for the purpose of computing the percentage of
outstanding Common Stock owned by such shareholder but is not deemed
outstanding for the purpose of computing the percentage of Common Stock
owned by any other shareholder.
5

<PAGE>
PRINCIPAL SHAREHOLDERS
The following table lists shareholders known by the Company to be the
beneficial owners of more than five percent of the outstanding Common Stock as
of the most recent practicable date.
<TABLE>
<CAPTION>
NUMBER OF
SHARES PERCENT OF
TITLE NAME AND ADDRESS BENEFICIALLY OUTSTANDING
OF CLASS OF BENEFICIAL OWNER OWNED (1) SHARES
<S> <C> <C> <C>
Common NationsBank Corporation 14,207,270(2) 17.4%
NationsBank Plaza
Charlotte, North Carolina 28255
Common Sanford C. Bernstein & Co., Inc. 7,472,165(3) 9.2%
One State Street Plaza
New York, New York 10004
Common INVESCO MIM PLC 5,970,737(4) 7.3%
11 Devonshire Square
London EC2M 4YR
ENGLAND
Common The Capital Group, Inc. 4,128,020(5) 5.1%
333 South Hope Street
Los Angeles, California 90071
</TABLE>

(1) Each shareholder has sole voting and investment power over all of the shares
listed, except as set forth below.
(2) As of December 31, 1993, NationsBank Corporation had sole voting power for
296,470 shares and sole investment power for 14,087,750 shares and had
shared voting power for 2,700 shares and shared investment power for 9,684
shares. Includes 12,747,291 shares and 1,131,409 shares held by NationsBank
of Virginia, N.A., a subsidiary of NationsBank Corporation, as Trustee for
the Company's Stock Purchase Plan and the James River II Salaried Employees
Retirement Savings Plan, respectively.
(3) As of December 31, 1993, Sanford C. Bernstein & Co., Inc., an investment
advisory company, had sole voting power for 4,242,609 shares and had no
voting power for the remaining 3,229,556 shares.
(4) As of December 31, 1993, INVESCO MIM PLC, a holding company for investment
advisory subsidiaries, had shared voting and investment power for all of
these shares.
(5) As of December 31, 1993, The Capital Group, Inc. had sole voting power for
2,060,720 shares, had no voting power for the remaining 2,067,300 shares,
and disclaims beneficial ownership of all 4,128,020 shares which are owned
by various institutional investors.
6

<PAGE>
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM COMPENSATION
AWARDS
SECURITIES
ANNUAL COMPENSATION RESTRICTED UNDERLYING
NAME AND OTHER ANNUAL STOCK OPTIONS/
PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION (2) AWARD(S) (5) SARS (6)
($) ($) ($) ($) (NUMBER)
<S> <C> <C> <C> <C> <C> <C>
Robert C. Williams 1993 824,615 0 0 252,000(3) 0
Chairman, President, and 1992 760,000 0 636,368 0 30,000
Chief Executive Officer 1991 703,115 65,000(1) * 0 27,200
Norman K. Ryan 1993 323,077 0 0 252,000(3) 0
Executive Vice 1992 300,000 0 22,824 0 15,000
President 1991 300,000 65,000 * 0 12,000
Ernest S. Leopold 1993 313,846 0 0 157,500(3) 0
Executive Vice 1992 300,250 0 37,928 0 10,000
President 1991 300,000 21,198 * 0 12,000
James K. Goodwin 1993 288,462 0 0 252,000(3) 0
Executive Vice 1992 256,307 0 0 0 52,000
President 1991 150,385 60,154 * 402,000(4) 10,550
Ronald B. Estridge 1993 261,923 0 0 151,200(3) 0
Senior Vice President 1992 255,000 0 18,403 0 6,000
1991 255,000 17,493 * 0 8,000
<CAPTION>

NAME AND ALL OTHER
PRINCIPAL POSITION COMPENSATION (7)
($)
<S> <C>
Robert C. Williams 56,007
Chairman, President, and 38,778
Chief Executive Officer *
Norman K. Ryan 18,124
Executive Vice 15,858
President *
Ernest S. Leopold 19,918
Executive Vice 18,481
President *
James K. Goodwin 6,780
Executive Vice 6,593
President *
Ronald B. Estridge 8,511
Senior Vice President 8,522
*
</TABLE>

*Under Securities and Exchange Commission ("SEC") transition rules, no
disclosure is required.
(1) Mr. Williams did not participate in payments from the Profit Sharing Plan
but was granted a year-end bonus by the Board of Directors in 1991.
(2) The amounts disclosed herein represent the tax reimbursement associated with
distributions for annuity purchases made in 1992 and also, in the case of
Mr. Williams, the tax reimbursement paid in 1992 associated with a
distribution for an annuity purchase made in a prior year. These annuities
were purchased pursuant to the Supplemental Benefit Plan which is discussed
herein under the heading "Pension Plan".
(3) In June 1993, the named executive officers received the following grants of
units representing hypothetical shares of Common Stock under the Company's
Deferred Stock Plan which vest in equal annual increments over the number of
years indicated: Robert C. Williams, 12,000 units, two years; Norman K.
Ryan, 12,000 units, six years; Ernest S. Leopold, 7,500 units, five years;
James K. Goodwin, 12,000 units, eight years; and Ronald B. Estridge, 7,200
units, six years.
(4) Mr. Goodwin became an employee of the Company in May 1991. In connection
with his becoming an executive officer of the Company, he received a grant
of 16,000 units representing hypothetical shares of Common Stock under the
Company's Deferred Stock Plan; these units will vest in equal annual
increments over eight years.
(5) The number and value ($18.50 per unit) as of December 26, 1993, of the
restricted Common Stock holdings for the named executive officers were:
Robert C. Williams, 16,213 units, $299,941; Norman K. Ryan, 17,918 units,
$331,483; Ernest S. Leopold, 13,151 units, $243,294; James K. Goodwin,
25,398 units, $469,863; and Ronald B. Estridge, 11,610 units, $214,785.
These units are hypothetical shares of Common Stock that are currently
subject to vesting restrictions under the Deferred Stock Plan. Under the
Deferred Stock Plan, the grantee's interest in the hypothetical shares of
Common Stock becomes vested in equal annual increments over a period of time
established for each grantee by the Compensation Committee; the vesting
schedules established for the named executive officers range from two years
to eight years. At the end of each fiscal year, dividends which would have
accrued on such shares are credited to each grantee's account in the form of
additional hypothetical shares. Upon irrevocable election of the grantee at
the time of the award, awards are paid either (i) as amounts become vested
or (ii) in installments upon retirement or after age 65. Messrs. Ryan,
Leopold, Goodwin, and Estridge elected a pre-retirement payout for a portion
of their grants.
7

<PAGE>
(6) During the year ended December 26, 1993, there were no grants of stock
options or stock appreciation rights (SARs) to the named executive officers,
therefore no table has been included for Option/SAR Grants in the last
fiscal year.
(7) These amounts include Company contributions to the Stock Purchase Plan, the
Supplemental Deferral Plan, and an enhanced life insurance plan. In
addition, the amount disclosed for Mr. Williams includes $2,256 representing
the Company's portion of the premium paid in 1993 on a term life insurance
policy for his benefit. Company contributions allocated under the Stock
Purchase Plan and the Supplemental Deferral Plan, respectively, to the named
executive officers for 1993 were: Robert C. Williams, $7,075 and $17,688;
Norman K. Ryan, $7,975 and $2,617; Ernest S. Leopold, $7,975 and $2,340;
James K. Goodwin, $5,896 and $0; and Ronald B. Estridge, $7,729 and $782.
The remainder of the amounts disclosed for 1993, if any, represent the
Company contributions allocated to these individuals under an enhanced life
insurance plan offered to certain officers as an alternative to the group
universal life insurance plan.
Mr. Williams has historically had an employment contract with the Company
that provides a minimum amount of salary to be paid during the term of the
contract. This contract contains clauses prohibiting him from competing,
directly or indirectly, with the Company or its subsidiaries during the term of
the contract or while he is entitled to receive any payments thereunder. The
Board of Directors approved the amendment of his contract for a term of
employment through January 1996, effective January 1, 1993. The contract
provides that Mr. Williams will receive an annual salary of not less than
$900,000 effective July 1993. In the event of his death or disability, his
salary will continue to be paid for one year. The contract further provides that
Mr. Williams will receive, in addition to his benefits accrued under the
Company's pension plan, $12,000 per year for ten years, or an annuity of the
equivalent actuarial value, upon his retirement at or after age 65. In the event
of his death prior to the receipt of all benefits to which he is entitled under
this contract, the remaining benefits will be paid to his spouse, if living, or
to his estate. On January 1, 1993, the Company also entered into an ancillary
letter agreement with Mr. Williams which provides for the continuation of
certain existing benefits as post-retirement benefits; in addition, Mr. Williams
will be eligible to receive compensation as a non-employee director in
connection with his continuing to serve on the Board of Directors after his
retirement from employment. This agreement also provides for a post-retirement
consulting arrangement through April 30, 2002, for continuing consulting
services to the Board at an annual fee of $162,000; this fee will be reduced by
any amounts paid to him as a director of James River or its affiliates.
Mr. Leopold has a supplemental retirement benefit agreement which provides
for a minimum annual retirement benefit if he retires from employment with the
Company in addition to the benefits accrued under the Company's pension plan.
This benefit is based upon his age at retirement. Mr. Leopold's minimum annual
benefit increases from $83,000, if he retires currently, to $98,000 if he
retires at age 62 or older. The minimum benefits will be reduced by the annual
benefits derived from employer contributions that are payable to him under the
Company's retirement plan. In the event of his death during his employment, a
survivor annuity providing similar benefits would be paid to his surviving
spouse. On October 26, 1992, the Company entered into an ancillary letter
agreement with Mr. Leopold which provides for salary or salary continuation,
together with life, accident, and health insurance benefits, to be continued for
a maximum of three years if the Company sells one or more significant parts of
the Communications Papers Business and if Mr. Leopold does not obtain a
comparable position with James River or the purchaser at a comparable salary
level. If such sale occurs, the Company agrees, to the extent permitted by law,
to accelerate the vesting of his outstanding stock options to the date of his
retirement. The Company also agrees to increase his pension benefits to reflect
an additional three years of service and age, if any such sale occurs and if Mr.
Leopold does not remain with James River for two years thereafter, regardless of
any employment offer from the purchaser.
8

<PAGE>
AGGREGATE OPTION/SAR EXERCISES IN THE LAST FISCAL YEAR
AND FISCAL YEAR END OPTION/SAR VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
UNDERLYING UNEXERCISED IN-THE-MONEY
OPTIONS/SARS OPTIONS/SARS
SHARES ACQUIRED VALUE AS OF 12/26/93 (1) AS OF 12/26/93 (2)
NAME ON EXERCISE REALIZED EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
<S> <C> <C> <C> <C> <C> <C>
(NUMBER) ($) (NUMBER) (NUMBER) ($) ($)
Robert C. Williams 0 0 399,664 44,316 0 0
Norman K. Ryan 0 0 141,494 23,666 0 0
Ernest S. Leopold 0 0 156,567 19,333 0 0
James K. Goodwin 0 0 24,367 38,183 0 0
Ronald B. Estridge 0 0 98,319 11,599 0 0
</TABLE>

(1) No additional SARs may be issued under the Company's Stock Appreciation
Rights Plan, although SARs which were previously granted and are still
outstanding may be exercised in accordance with the provisions of the plan.
(2) All exercise prices for the unexercised options and SARs held by the named
executives as of December 26, 1993, exceeded the closing price of $18.50 for
Common Stock as of that date; thus, no value is disclosed.
PENSION PLAN
The Company provides a pension plan for salaried employees under which
participating employees contribute 1% of their pensionable earnings. Pensionable
earnings include base salary, overtime compensation, profit sharing, bonuses,
and commissions. Annual benefits payable under the plan are currently equal to
the product of the participant's years of service while contributing to the
plan, up to 30 years, multiplied by the sum of 1.05% of a participant's
"Average Pay" (the average of a participant's highest five consecutive years of
pensionable earnings) plus .65% of a participant's Average Pay in excess of
covered compensation (the average of the taxable Social Security wage bases
during a participant's work lifetime, up to 35 years). A participant will be
vested in the portion of benefits attributable to Company contributions (i)
after five years of service or (ii) if the participant's contributions remain in
the plan until retirement, in the event of termination of employment prior to
retirement eligibility.
An alternative pension benefit formula may be used to calculate the pension
benefit for service through December 31, 1988, for employees who participated in
the plan prior to January 1, 1989. However, if the current formula provides a
greater benefit at retirement for such service, that formula will apply.
Effective in 1993 under Internal Revenue Service regulations, the maximum
annual benefit which may be paid to any retiree from the plan, attributable to
employer contributions, is $115,641. This amount may be increased to take into
account increases in the cost of living; effective January 1, 1994, this amount
was increased to $118,800. The Company also maintains the Supplemental Benefit
Plan which provides eligible individuals with the difference between the
benefits they actually accrue under the pension plan and the benefits they would
have accrued under such plan but for the maximum benefit and compensation
limitations imposed by law. The Supplemental Benefit Plan also provides eligible
individuals with a benefit that approximates the additional benefit that would
have been payable under the pension plan had the benefit formula in effect on
December 31, 1988, continued in effect. Participants in the Supplemental Benefit
Plan are general creditors of the Company. The supplemental benefits are to be
paid by the Company as the benefits become payable, except as described below.
The Company maintains a supplemental benefit trust to provide benefits under the
Supplemental Benefit Plan. The assets of the trust are subject to the claims of
the Company's creditors in the event of bankruptcy or insolvency.
The Supplemental Benefit Plan provides that the accrued benefits under the
plan may be distributed at the discretion of the Company. The Company has made
distributions to certain eligible individuals providing each such individual
with an annuity, on an after tax basis, approximating the individual's accrued
benefit under the Supplemental Benefit Plan as of a specified date, including in
the case of Mr. Williams, his benefits through February 1, 1995, representing
the end of his then existing contract period. Each annuity will be payable by an
insurance company under an annuity contract owned by the individual. No amounts
were distributed for annuity purchases during 1993. To the extent accrued
benefits have been distributed, the individual relinquishes his claims for those
benefits under the Supplemental Benefit Plan. Since the determination of
9

<PAGE>
an individual's accrued benefit is made without regard to future actuarial
increases, the distributions may not represent the individual's total benefit to
be received under the Supplemental Benefit Plan.
APPROXIMATE ANNUAL PENSION BENEFIT AT AGE 65
<TABLE>
<CAPTION>
FINAL AVERAGE YEARS OF SERVICE
PAY 10 15 20 25 30
<S> <C> <C> <C> <C> <C>
$ 200,000 $ 32,420 $ 48,630 $ 64,839 $ 81,049 $ 97,259
400,000 66,420 99,630 132,839 166,049 199,259
600,000 100,420 150,630 200,839 251,049 301,259
800,000 134,420 201,630 268,839 336,049 403,259
1,000,000 168,420 252,630 336,839 421,049 505,259
</TABLE>

The pensionable earnings for each of the named executive officers are not
materially different from the amounts disclosed in the salary and bonus columns
in the Summary Compensation Table. The estimated years of benefit service, as of
normal retirement at age 65, for the named executive officers are: Robert C.
Williams, 30 years; Norman K. Ryan, 20 years; Ernest S. Leopold, 13 years; James
K. Goodwin, 20 years; and Ronald B. Estridge, 24 years. The above table shows
the approximate annual pension benefit which would be provided to salaried
employees, under the benefit formula effective January 1, 1989, upon retirement
at age 65 assuming that a single life annuity has been elected. The amounts in
the table are not subject to reduction for Social Security or other offset
amounts. The pension table includes benefits under the Supplemental Benefit
Plan, some of which will be provided by the annuities purchased, if any, as
described above.
10

<PAGE>

PERFORMANCE GRAPH
James River is subject to SEC rules which require all public companies to
present a graph of total investment return in their annual proxy statement. The
rules require a line graph which compares James River's five-year cumulative
shareholder return on its Common Stock with the Standard & Poor's ("S&P") 500
Stock Index and either a published industry index or an index of peer companies
selected by the Company. The graph below presents a comparison of James River's
performance with the S&P 500 Stock Index and the S&P Paper and Forest Products
Industry Index, assuming that investments of $100 were made on December 31,
1988, and that dividends were reinvested. During 1990, James River changed its
fiscal year from one ending on the last Sunday in April to one ending on the
last Sunday in December. In order to provide comparability among the indices,
shareholder returns have been presented on a calendar year basis from December
31, 1988, through December 31, 1993.

COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN AMONG
JAMES RIVER CORPORATION OF VIRGINIA, S&P 500 INDEX,
AND S&P PAPER AND FOREST PRODUCTS INDUSTRY INDEX

(GRAPH AS DEFINED BY THE FOLLOWING DATA POINTS)

1988 1989 1990 1991 1992 1993
James River $100 $100.94 $95.88 $75.24 $71.76 $76.96

S&P 500 Stock Index $100 $131.69 $127.60 $166.47 $179.15 $197.21

S&P Paper & Forest
Products Industry
Index $100 $121.28 $109.57 $138.98 $158.91 $175.13

<TABLE>
<S> <C> <C> <C> <C> <C> <C>
James River $100 $100.94 $ 95.88 $ 75.24 $ 71.76 $ 76.96
S&P 500 Stock Index $100 $131.69 $127.60 $166.47 $179.15 $197.21
S&P Paper & Forest
Products Industry Index $100 $121.28 $109.57 $138.98 $158.91 $175.13
</TABLE>

<PAGE>
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
The Compensation Committee of the Board of Directors (the "Committee") has
the responsibility for the design, development, and approval of the Company's
executive compensation program.
There are two objectives of this program. The first is to attract, retain,
and competitively reward individual executives commensurate with their level of
responsibility and experience. The second is to provide senior executives with
meaningful incentives that align individual rewards to company performance,
thereby enhancing long-term profitability and maximizing shareholder value.
In order to balance the objectives of short-term salary competitiveness and
long-term value, the Company's executive compensation program has four principal
components -- base salary, annual cash profit sharing, the granting of options
to purchase the Company's Common Stock, and the award of hypothetical shares of
Common Stock pursuant to the Company's Deferred Stock Plan.
BASE SALARY
Base salary is intended to attract, retain, and competitively reward
individuals. Of the four principal components of the executive compensation
program, it is least affected by Company performance. The objective is to
provide a base level of compensation that is competitive when benchmarked
against similar positions within companies of similar size and scope, especially
those in the forest products and consumer products industries.
To derive competitive base salary data, James River participates in a
number of salary surveys which are administered by independent third party
consultants. One of these surveys is specific to the paper and forest products
industry while another covers companies in each of the paper and forest
products, consumer products, and general industries. While these surveys provide
competitive compensation data in the aggregate, they do not identify
participating companies. Therefore, it is impossible to evaluate or compare the
financial performance of the participants to that of James River.
The surveys do provide information with respect to the sizes of the
companies participating. Some of them are significantly smaller or larger than
James River. When establishing base compensation values, a statistical
regression analysis is performed to take into account the varying sizes of the
companies against which James River compares itself.
This competitive information is utilized annually to evaluate and update a
salary grade structure for all executive officers except for the chief executive
officer (CEO). This grade structure reflects, on average, how the industrial
community would competitively value a like position. The employees are assigned
a salary grade level which includes a minimum, midpoint, and maximum. Where
survey information exists, data for a particular position is analyzed and a
midpoint, which corresponds to the average market value of the position, is
derived. An executive's position within the grade range is a function of both
quantitative and qualitative factors, including individual contribution level
and length of time in position, among others. All of the executive officers,
excluding the CEO, are at or below the midpoint of the range for their
respective positions.
PROFIT SHARING
Annual profit sharing is a short-term incentive program that is intended to
reinforce the efforts necessary to maximize Company success while providing
competitive amounts of variable pay tied directly to Company performance. Under
the profit sharing plan in effect for the year ended December 26, 1993, specific
return on equity ("ROE") targets generate a profit sharing pool determined as a
percentage of pretax profits. Awards, if any, are distributed from the total
pool to the various business units in relation to their contributions to the
overall Company goals. If the Company as a whole does not meet its performance
goals, no individual business unit payments are made, regardless of the
performance level of any one business.
The profit sharing pool, as described above, is distributed to all salaried
employees, except the CEO, in amounts commensurate with their level of
responsibility and individual contributions. Therefore an individual award
earned, if any, is a function of overall Company performance and the
individual's salary grade and contribution levels.
As discussed earlier, individual grade levels are determined based on paper
and forest products and general industry surveys for like positions. Each
individual's contribution is measured by his or her goal attainment. These
measurements include both quantitative (customer service, productivity, volume,
etc.) and qualitative (project management skills, leadership ability, strategic
management ability, commitment to employee development and training, etc.)
performance factors. Based
12

<PAGE>
upon a year when the Company and the individual meet their performance
objectives, the individual award amounts are designed to be competitive for
individuals at like levels.
The objective behind the allocation of profit sharing amounts to all
salaried employees is to motivate them to cause the Company to perform better
than competitors. The plan provides for above average variable pay when Company
performance is high and below average variable pay when performance is below
expectations. Based on the Company's performance in 1993, no profit sharing
amounts were awarded. Consequently, the total cash compensation of the Company's
executive officers, excluding the CEO, was below competitive averages when
compared to paper and forest products and general industry survey information.
STOCK OPTIONS
The stock option program is viewed as a long-term incentive vehicle for
rewarding future performance. Its objective is to align executive efforts with
the maximization of Company performance correlating executive rewards with
increases in shareholder value. By design the plan provides value to its
participants only when shareholders benefit from stock price appreciation.
Key employees, including the executive officers, are eligible to
participate in this plan. Options are generally granted on an annual basis with
terms of ten years and generally vest in equal installments over a period of
three years. Options generally may not be exercised unless the individual
remains in the employment of the Company for at least one year after the grant
date. All stock options are granted with an exercise price equal to the fair
market value of the Company's Common Stock on the date of grant.
Individual awards under the stock option program are determined by grade
level and influenced by individual performance. The grade level target amount
for each participant is reflective of paper and forest products and general
industry competitive survey data for comparable positions. This process of
competitive comparison for option amounts is analogous to that used for base
salary analysis. Aggregated, these individual amounts constitute the total
number of options assignable to all plan participants for any given grant.
Within this parameter, individual awards may be adjusted, either up or down,
based upon individual performance.
During 1993, the Compensation Committee authorized a stock option grant to
a number of key employees. At the discretion of the Compensation Committee, the
executive officers were not included in this grant. This decision was based in
part on the fact that inclusion of the executive officers in this grant would
have substantially reduced the number of options available under the plan for
the remainder of the plan participants.
DEFERRED STOCK PLAN
The primary objective of the Deferred Stock Plan is to encourage plan
participants to remain in the employ of the Company and promote its success. A
secondary objective of the plan, since participants are able to defer their
vested award amounts until retirement, is to act as an effective supplemental
retirement plan.
It is the intent of the Compensation Committee to authorize awards under
this program on an average of every five years. There have been three grants
under this plan since its inception -- in 1984, 1989, and 1993. Participation is
generally limited to those senior level executives with significant policy and
decision making ability. Each participant in the Deferred Stock Plan is issued
an award of hypothetical shares of the Company's Common Stock. The awards vest
over varying lengths of time, but not longer than eight years. The actual award
value realized by a participant is dependent upon his or her continued
employment with the Company and the performance of the Common Stock.
The number of shares for each executive officer is determined by taking a
percentage of salary, based on the number of years until retirement, and
dividing that amount by the fair market value per share on the date of grant.
These formula amounts are then adjusted, either up or down, to reflect an
individual's qualitative and quantitative performance.
During 1993, the Compensation Committee authorized the grant of deferred
stock to certain key senior executives. The purpose of the grant was to ensure
continuity in the executive ranks as this is considered critical to the overall
success of the Company. Since this grant was four years (instead of five years)
from the previous one, it was discounted by more than 20% to adjust for the one
year acceleration of the grant.
13

<PAGE>
MISCELLANEOUS
Executive officers also participate in other Company benefit plans that are
generally available to all salaried employees, such as group life and health
insurance plans and stock purchase plans.
In addition, the Company provides benefits to executives and other eligible
employees under its Supplemental Benefit Plan, its Supplemental Deferral Plan,
and an enhanced life insurance plan. The Supplemental Benefit Plan provides
eligible individuals with the difference between the benefits they actually
accrue under the Company's salaried employees pension plan and the benefits they
would have accrued under such plan but for the maximum benefit and compensation
limitations imposed by law. Pursuant to its Supplemental Benefit Plan, the
Company has purchased and distributed to certain executive officers annuity
contracts with respect to their accrued benefits as of specified dates. The
Supplemental Deferral Plan allows eligible employees to defer the portion of
their compensation that they are prevented from contributing under the Company's
stock purchase plan due to limitations imposed by income tax regulations and to
receive Company matching contributions, consistent with the stock purchase plan
matching percentages, with respect to such deferred compensation in the form of
hypothetical shares of Common Stock. The enhanced life insurance plan is offered
to certain officers as an alternative to the group universal life insurance plan
offered to all salaried employees. Other than with respect to the Supplemental
Deferral Plan, where the benefits to be received upon termination of employment
are based on the Company's stock price, benefits under these executive plans are
not related to Company performance.
Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Internal Revenue Code"), which was enacted in 1993, imposes a $1,000,000
limit on the amount of compensation that will be deductible by the Company
with respect to the Chief Executive Officer and the four other most highly
compensated executive officers. Performance-based compensation that meets
certain requirements will not be subject to this deduction limit. The Company
is proposing changes to its 1987 Stock Option Plan and has designed the 1993
Profit Sharing Plan for Salaried Employees with the intention of making these
plans meet the requirements for performance-based compensation. The Company is
proposing changes to its Deferred Stock Plan to authorize deferral of a
participant's benefit if the benefit would otherwise not be deductible as a
result of the $1,000,000 limit. The new limit will apply to taxable years
beginning on or after January 1, 1994, which means that the limit is first
effective for the Company's fiscal year ending in December 1995.
CEO COMPENSATION
The Company has an employment contract with its Chief Executive Officer,
Robert C. Williams, which is generally reviewed every two years. The contract
outlines terms and conditions of employment including base salary and variable
compensation.
As stated earlier, of the various components of compensation, base salary
is the least determined by Company performance. Factors such as leadership,
individual performance, and functional roles are heavily considered.
Before 1993, the last increase in Mr. Williams' base salary was in May
1991. In 1992, he assumed the responsibilities of Chairman in addition to his
roles of CEO and President, for which he received no additional base salary.
After careful consideration, in 1993 the Committee decided to raise his base
compensation to $900,000 annually. This action reflected Mr. Williams'
leadership ability and functional responsibility for the two most senior
positions in the Company, i.e. Chairman/CEO and President/Chief Operating
Officer.
The CEO did not participate in the Company's profit sharing plan prior to
1994. However, in the past, the Compensation Committee has generally granted the
CEO a bonus in years in which profit sharing awards were made under the profit
sharing plan. Because of the Company's 1993 performance, no profit sharing
awards were paid for 1993, and Mr. Williams did not receive a bonus for 1993.
The Committee approved a grant of 12,000 hypothetical shares of Common
Stock to Mr. Williams under the Deferred Stock Plan in 1993. Again, this was in
recognition of Mr. Williams' leadership in the roles mentioned earlier and his
substantial efforts on behalf of the Company.
14

<PAGE>
CONCLUSION
The Committee believes that base compensation and the variable compensation
plans outlined are appropriate for executives at James River, a large,
integrated consumer paper products company. Overall performance in 1993, while
still not at an acceptable level, showed improvement over 1992 results. The
salary increases and hypothetical shares under the Deferred Stock Plan that were
authorized by the Committee were viewed as necessary to ensure continuity in the
executive group.
FitzGerald Bemiss (Committee Chairman)
William T. Burgin
Worley H. Clark, Jr.
COMPLIANCE WITH SECTION 16(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934 and SEC regulations
require the Company's directors, certain officers, and greater than ten percent
shareholders to file reports of ownership on Form 3 and changes in ownership on
Forms 4 or 5 with the SEC. The Company undertakes to file such forms for its
directors and officers pursuant to powers of attorney given to certain
attorneys-in-fact. Such directors, officers, and ten percent shareholders are
also required by SEC rules to furnish the Company with copies of all Section
16(a) reports they file.
Based solely on its review of copies of such reports received or written
representations from such officers, directors, and ten percent shareholders, the
Company believes that, during the fiscal year ended December 26, 1993, all
Section 16(a) filing requirements applicable to its directors, officers, and ten
percent shareholders were met, except for one late Form 4 filing by Mr. Woodside
to report the sale of 1,000 shares by his wife.
INDEPENDENT ACCOUNTANTS
Upon the recommendation of the Audit Committee, the Board of Directors has
appointed Coopers & Lybrand to serve as the independent accountants of the
Company for its fiscal year ending December 25, 1994, and has directed a vote of
shareholders to be taken to ascertain their approval or disapproval of that
appointment. In the event the shareholders do not approve the appointment of
Coopers & Lybrand, the selection of other independent accountants will be
considered by the Board of Directors.
A representative of Coopers & Lybrand is expected to be present at the
Annual Meeting of Shareholders. He will have an opportunity to make a statement
if he so desires and will be available to answer appropriate questions from
shareholders.
ANNUAL REPORT
A copy of the Annual Report of the Company for the fiscal year ended
December 26, 1993, is being mailed to you with this Notice and Proxy Statement.
No part of the Annual Report shall be regarded as proxy soliciting material.
PROPOSALS RELATING TO EMPLOYEE BENEFIT PLANS
STOCK PURCHASE PLAN
The Company has maintained the Stock Purchase Plan since 1973. The purpose
of the plan is to encourage regular savings on the part of the Company's
employees and to give them a proprietary interest in the Company and thereby
promote its success. In order to further the plan's objectives, management
proposes to amend and restate the plan in the form attached to this Proxy
Statement as Exhibit A, contingent upon shareholder approval.
PROPOSED PLAN RESTATEMENT
On December 10, 1993, the Board of Directors approved the proposed
amendment and restatement of the plan, which is to become effective on July 1,
1994, and recommended that it be submitted to the shareholders for approval.
Under the restated plan, all employees of the Company and its participating
subsidiaries will be eligible to participate in the plan as of their date of
hire. Participants may elect to contribute up to 10% of their compensation as
pretax contributions
15

<PAGE>
under Section 401(k) of the Internal Revenue Code. The Company will make
matching contributions as described below with respect to participants'
contributions.
Matching contributions will be made in shares of Common Stock or will be
made in cash and invested by the trustee in Common Stock (except as described
below). A bank will serve as the plan trustee. Participants' contributions may
be invested, according to the participants' directions, in Common Stock or in
any of the alternative investment funds offered under the plan. At least three
alternative investment funds will be offered.
Pretax contributions made by participants who have not attained age 57 must
be invested in Common Stock in order to receive matching contributions from the
Company. Participants who have not attained age 57 and who choose to invest
their pretax contributions in the alternative investment funds will not receive
matching contributions. Pretax contributions of participants who have attained
age 57 will be matched, even if they are not invested in Common Stock. The
Company will make matching contributions on behalf of the eligible participants
pursuant to the following schedule:
<TABLE>
<CAPTION>
COMPANY CONTRIBUTION AS A
PERCENTAGE OF
PARTICIPANT CONTRIBUTION AS A PARTICIPANT'S
PERCENTAGE OF COMPENSATION TOTAL CONTRIBUTION
<S> <C>
1% 120%
2% 100%
3% 90%
4% 80%
5% 70%
6% 60%
</TABLE>

The Company will make no matching contributions with respect to the portion
of a participant's pretax contributions that exceeds 6% of the participant's
compensation. Pretax contributions that are matched must remain invested in
Common Stock until the earlier of (i) the date on which they have been held in
the plan for 24 months or (ii) the date on which the participant attains age 57.
Matching contributions must remain invested in Common stock until the
participant attains age 57. Participants who have attained age 57 may direct the
investment of all of their accounts (including matching contributions) into the
plan's alternative investment funds. Subject to certain exceptions,
contributions made before July 1, 1994, must remain invested in Common Stock
until the participant attains age 57.
Each participant will have a fully vested interest in all of his accounts
under the plan. Distributions are normally made to a participant upon
termination of employment. A participant (or his beneficiary) may elect to have
his accounts distributed over a period of years after his retirement or death.
Distributions may be made in cash or in Common Stock.
A participant may make withdrawals from his accounts attributable to pretax
contributions, and matching contributions made with respect to pretax
contributions, after the participant attains age 59 1/2 or in the event of
hardship. With limited exceptions, withdrawals may be made as of the end of any
month from a participant's other accounts. Plan participants have the right to
direct the trustee with respect to the voting, tender, and exercise of similar
rights with respect to shares of Common Stock allocated to their accounts.
Because of Canadian income tax laws, Canadian employees may not make
contributions to the plan, and they are subject to other restrictions not
imposed on United States employees.
The Board of Directors may make future plan amendments without shareholder
approval. However, if any amendments are made prior to the effective date of the
proposed changes to Rule 16b-3 ("Rule 16b-3") of the Securities Act of 1934
(the "1934 Act") (currently scheduled to be September 1, 1994) that would
materially increase the benefits accruing to participants under the plan,
materially increase the number of securities that may be issued under the plan,
or materially modify the requirements as to eligibility for participation in
the plan, such amendments must be approved by the shareholders.
Approximately 27,000 employees are currently eligible to participate in the
plan. The following table shows an estimate of the contributions that would have
been made to the plan for 1993 had the restated plan then been in effect. This
table is based on the total after-tax and pretax contributions made by
participants for the 1993 year and the matching rate that will be in effect for
pretax contributions after the restatement. Contributions made on an after-tax
basis in 1993 have been treated as pretax contributions in determining the
amount of total employee contributions for the table, subject to the annual
limitation imposed by the Internal Revenue Code. The employee contribution
levels used to determine employer matching percentages
16

<PAGE>
for the table have been estimated based on actual contribution levels for a
previous one-month period. For purposes of the table, all contributions are
deemed to have been invested in Common Stock.
ESTIMATED STOCK PURCHASE PLAN BENEFITS UNDER RESTATED PLAN
<TABLE>
<CAPTION>
EMPLOYER
EMPLOYEE MATCHING
NAME CONTRIBUTIONS CONTRIBUTIONS
<S> <C> <C>
($) ($)
Robert C. Williams 8,994 5,396
Norman K. Ryan 8,994 5,396
Ernest S. Leopold 8,994 5,396
James K. Goodwin 8,994 5,396
Ronald B. Estridge 8,994 5,396
Executive Group 105,207 63,817
Non-Executive Officer Employee Group 26,547,114 18,577,137
</TABLE>

PLAN BEFORE THE RESTATEMENT
Prior to the restatement, the plan provided that employees could elect to
make pretax contributions after they completed a year of service and after-tax
contributions after they had attained age 18 and completed a 30-day period of
service. Participants could elect to have contributions, from 1% to 10% of the
participant's compensation, made in the form of pretax contributions or
after-tax contributions. The Company contributed, with respect to after-tax
contributions, 100% of the participant's contribution if it equalled 1% of his
compensation, 65% of his contribution if it equalled 2% of his compensation, and
50% of his contribution if it equalled 3%, 4%, 5%, or 6% of his compensation.
The Company contributed, with respect to pretax contributions, 110% of the
participant's contribution if it equalled 1% of his compensation, 75% of his
contribution if it equalled 2% of his compensation, and 60% of his contribution
if it equalled 3%, 4%, 5%, or 6% of his compensation. Company matching
contributions with respect to pretax contributions were 100% vested. Company
matching contributions with respect to after-tax contributions became vested
when the participant had made contributions to the plan for 24 months, when the
participant had completed five years of service, or at other earlier dates
specified in the plan.
The plan provided for contributions to be invested in Common Stock. The
trustee voted shares of Common Stock according to participants' directions. An
alternative fixed income investment fund was available for participants who had
attained age 59 1/2.
Distributions from a participant's account invested in Common Stock could
be made in Common Stock or in cash, except that such accounts of participants
who were insiders ("Insiders") for purposes of Section 16 of the 1934 Act could
only be distributed in whole shares of Common Stock, with fractional shares paid
in cash. Any portion of a participant's account that was invested in the fixed
income fund was paid in cash.
In order to comply with Rule 16b-3, the plan provided that the shareholders
must approve any amendment that would materially increase the benefits accruing
to participants under the plan, materially increase the number of securities
that may be issued under the plan, or materially modify the requirements as to
eligibility for participation in the plan, with limited exceptions.
VOTE REQUIRED
Adoption of the proposed amendment and restatement of the Stock Purchase
Plan requires the affirmative vote of the holders of a majority of the
outstanding shares of Common Stock represented and entitled to vote at the
Annual Meeting of Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE PROPOSED
AMENDMENT AND RESTATEMENT OF THE STOCK PURCHASE PLAN.
17

<PAGE>
1987 STOCK OPTION PLAN
The Company has maintained the 1987 Stock Option Plan since February 1987.
The purpose of the plan is to give key employees an opportunity to acquire a
proprietary interest in the Company and an additional incentive to promote its
success, as well as to encourage them to remain in the employ of the Company. In
order to further the plan's objectives, management proposes to amend and restate
the plan in the form attached to this proxy statement as Exhibit B, contingent
upon shareholder approval.
PROPOSED PLAN RESTATEMENT
On December 10, 1993, the Board of Directors approved the proposed
amendment and restatement of the plan and recommended that it be submitted to
the shareholders for approval. The number of shares authorized to be issued
under the plan is increased by 2,000,000 shares, to a total of 8,000,000 shares
(including shares theretofore issued and shares reserved for issuance).
Appropriate adjustments will be made in the number and kind of shares to be
issued under the plan, the exercise price, and other relevant provisions in the
event of a stock dividend, stock split, merger, or other similar change.
Stock options may be granted to key employees of the Company and its
subsidiaries and foreign affiliates. The plan limits the number of options that
an employee may receive during a one-year period to 300,000 shares. Stock
options may be incentive stock options under Section 422 of the Internal Revenue
Code or nonstatutory options.
The plan is administered by the Compensation Committee, which is a
committee of non-employee directors. The Compensation Committee selects the key
employees who are to receive options under the plan and determines the number of
shares with respect to which each option is granted. Options are granted at an
exercise price equal to the fair market value per share of the Common Stock on
the date the option is granted (110% of the fair market value, in the case of
incentive stock options granted to a 10% shareholder).
The Compensation Committee determines the terms of options, including any
vesting provisions and the provisions for exercise of options after termination
of employment. The Compensation Committee may take such actions as it deems
appropriate in the event of a change of control, a significant corporate change,
or a spin-off of a subsidiary.
The Compensation Committee may grant release rights with respect to
nonstatutory options. Release rights allow a participant to release a portion of
his nonstatutory options and receive in cash the value (the excess of the fair
market value over the exercise price) of that portion of the options at the time
of release. The number of release rights eligible for exercise is determined by
a formula designed to approximate the participant's tax liability resulting from
the exercise of options and release rights.
Participants may exercise options by tendering cash or shares of Common
Stock, or by making appropriate arrangements through a broker for delivery of
the exercise price. The plan allows the Compensation Committee to establish
alternative ways of allowing participants to satisfy their tax withholding
obligations upon the exercise of options.
Options are generally not transferrable. The plan permits the Compensation
Committee to grant nonstatutory stock options that may be transferred to a
participant's family member or to a trust established by a participant or a
family member. Transferrable options may not be granted to Insiders unless
permitted by Rule 16b-3.
In order to comply with Rule 16b-3, the plan provides, as it did before the
restatement, that the shareholders must approve any amendment that would
materially increase the benefits accruing to participants under the plan,
materially increase the number of securities that may be issued under the plan,
or materially modify the requirements as to eligibility for participation in the
plan, with limited exceptions.
The Company will receive a tax deduction when an employee exercises a
nonstatutory stock option, but generally will not receive such a deduction when
an employee exercises an incentive stock option. A participant will be taxed on
the amount by which the fair market value of the Common Stock exceeds the
exercise price on the date the underlying Common Stock is sold for incentive
stock options and on the date of exercise for nonstatutory stock options. The
participant will also be taxed on the amount of cash received upon the exercise
of release rights. Special tax provisions apply to persons who are Insiders. A
participant may be subject to an alternative minimum tax when he exercises an
incentive stock option on the amount by which the fair market value of the
Common Stock exceeds the exercise price on the date of exercise. There are
generally no federal income tax consequences to the Company or the participant
at the time an option is granted.
18

<PAGE>
Approximately 850 key employees are currently eligible to participate in
the plan. Stock options are granted at no cost to the employee. On February 17,
1994, the market value of the Common Stock was $19.38 per share based on the
closing price on the New York Stock Exchange Composite Tape.
PLAN BEFORE THE RESTATEMENT
Prior to the restatement, the plan provided that 6,000,000 shares of Common
Stock could be issued under the plan including shares theretofore issued or
reserved for issuance, subject to adjustment in the event of stock splits or
stock dividends. Stock options and release rights could be issued by the
Compensation Committee to executive officers and other key employees of the
Company and its subsidiaries and foreign affiliates who perform services of
major importance in the management, operation, and development of the business.
The plan provided that incentive stock options were granted for a term of
ten years and nonstatutory options were granted for a term of ten years and one
day. The exercise price was equal to the fair market value of Common Stock on
the date of grant. Options generally became exercisable in three equal
cumulative annual amounts beginning as early as one year after the date of
grant, subject to the discretion of the Compensation Committee. Options were
generally exercisable for two years after a participant's retirement, permanent
disability, or death, although the Compensation Committee could grant options
with extended exercise periods. The plan provided for the acceleration of the
exercise period and the expiration date of options in certain circumstances,
including a merger or sale of assets of the Company or the participant's
retirement, permanent disability, or death, subject to limited exceptions.
Options were not transferrable. The plan provided that holders of options could
use previously owned shares of Common Stock, valued at the current market price,
to pay the exercise price of nonstatutory options.
VOTE REQUIRED
Adoption of the proposed amendment and restatement of the 1987 Stock Option
Plan requires the affirmative vote of a majority of the votes cast for or
against the proposal at the Annual Meeting of Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE PROPOSED
AMENDMENT AND RESTATEMENT OF THE 1987 STOCK OPTION PLAN.
DEFERRED STOCK PLAN
The Company has maintained the Deferred Stock Plan since 1984. The purpose
of the plan is to provide certain senior executive officers of the Company and
its subsidiaries with an additional incentive to promote the Company's success
and to encourage them to remain in the employ of the Company. In order to
further the plan's objectives, management proposes to amend and restate the plan
in the form attached to this proxy statement as Exhibit C, contingent upon
shareholder approval.
PROPOSED PLAN RESTATEMENT
On December 10, 1993, the Board of Directors approved the proposed
amendment and restatement of the plan and further amended the plan on February
18, 1994. The Board recommended that it be submitted to the shareholders for
approval. The amendment increases the number of shares of Common Stock
authorized to be issued under the plan by 1,000,000 shares, to a total of
2,050,000 shares including shares theretofore issued. Appropriate adjustments
will be made in the number and kind of shares to be issued under the plan and
other relevant provisions in the event of a stock dividend, stock split, merger,
or other similar change.
The plan authorizes the Compensation Committee, which administers the plan,
to grant awards as it deems appropriate to senior executive officers of the
Company and its subsidiaries. The Compensation Committee selects the executive
officers who will receive awards under the plan and determines the number and
amount of awards to be granted.
Awards are determined as a dollar amount, which is converted into
hypothetical shares of Common Stock based on the fair market value of the Common
Stock as of the date of the award. The hypothetical shares are credited to a
book account on the Company's records on behalf of the participant. As of the
end of each fiscal year, dividends that would have accrued on the shares are
credited to each participant's account in the form of additional hypothetical
shares. A participant's interest in the hypothetical shares becomes vested in
annual installments over a period of time established for each participant by
the Compensation Committee. The plan is unfunded, and participants are general
creditors of the Company.
19

<PAGE>
Through an irrevocable election made by the participant at the time of the
award, an award is paid either (i) as amounts become vested or (ii) in
installments upon retirement or after age 65. Payments may be made in shares of
Common Stock or in a combination of Common Stock and cash, as determined by the
Compensation Committee, based on the fair market value of the Common Stock on
the date of payment. Applicable withholding taxes will be withheld from
distributions.
The Compensation Committee is authorized to defer payment of a
participant's plan benefit if the participant's benefit would not be deductible
by the Company as a result of the $1,000,000 limit on deductible compensation
for certain executives under the Omnibus Budget Reconciliation Act of 1993. The
Compensation Committee may take such actions as it deems appropriate in the
event of a change of control, a significant corporate change, or a spin-off of a
subsidiary.
In order to comply with Rule 16b-3, the plan provides, as it did before the
restatement, that the shareholders must approve any amendment that would
materially increase the benefits accruing to participants under the plan,
materially increase the number of securities that may be issued under the plan,
or materially modify the requirements as to eligibility for participation in the
plan, with limited exceptions.
Approximately 40 senior executive officers are currently eligible to
participate in the plan. Deferred stock is granted at no cost to the employees.
See the discussion of the 1987 Stock Option Plan above for recent information
regarding the market value of Common Stock.
PLAN BEFORE THE RESTATEMENT
Prior to the restatement, the plan provided that 1,050,000 shares of Common
Stock could be issued under the plan, including shares theretofore issued,
subject to adjustment in the event of stock splits or stock dividends. Awards
were made as described above. The plan provided for payment as amounts became
vested or in installments after retirement or after age 65. The Compensation
Committee determined whether payments would be made in cash or in a combination
of cash and Common Stock.
VOTE REQUIRED
Adoption of the proposed amendment and restatement of the Deferred Stock
Plan requires the affirmative vote of a majority of the votes cast for or
against the proposal at the Annual Meeting of Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE PROPOSED
AMENDMENT AND RESTATEMENT OF THE DEFERRED STOCK PLAN.
1993 PROFIT SHARING PLAN FOR SALARIED EMPLOYEES
The Company has maintained a profit sharing plan for salaried employees
since 1970 and now wishes to adopt a new profit sharing plan, effective as of
December 27, 1993, contingent upon shareholder approval. The purpose of the plan
is to provide eligible salaried employees with annual incentives to increase the
productivity of the Company. In order to further the Company's objectives,
management proposes that the shareholders approve adoption of the plan in the
form attached to this proxy statement as Exhibit D.
PROPOSED PLAN
On February 18, 1994, the Board of Directors approved the proposed 1993
Profit Sharing Plan for Salaried Employees and recommended that it be submitted
to the shareholders for approval.
All regular non-bargaining unit salaried employees (excluding employees who
participate in other short-term bonus or incentive plans) of the Company and its
U.S. and Canadian subsidiaries are eligible to participate in the plan. The plan
provides for annual cash bonuses to eligible employees if the performance goals
established under the plan are met.
The Compensation Committee, which administers the plan, will establish the
performance goals for the Company each year. Under the performance goals,
specific return on equity targets generate a profit sharing pool determined as a
percentage of pretax profits. Chart 1 attached to the plan sets forth the
formula that will be used for calculating profit sharing (as described below)
for the fiscal year beginning December 27, 1993, and each subsequent year until
the Compensation Committee revises the chart (using the same format and
criteria).
20

<PAGE>
Each year, a total profit sharing pool will be computed as a specified
percentage of the consolidated pretax, pre-profit sharing profits before
extraordinary items of the Company and its U.S. and Canadian subsidiaries for
the year, based on consolidated return on equity. The Compensation Committee may
reduce the total profit sharing pool for a year if the Compensation Committee
determines that such a reduction is in the best interests of the Company. The
profit sharing pool will be allocated among all eligible employees based on
their salary and responsibility level (which is determined by salary grade).
Awards are paid in cash after the end of the fiscal year. Before awards are
paid for a year, the Compensation Committee must certify that the performance
goals and other requirements of the plan have been met. The maximum award that
may be paid to an employee for any fiscal year is $1,000,000. Employees
generally receive no profit sharing awards if their employment terminates prior
to the last day of the fiscal year for reasons other than death, disability,
retirement, temporary layoff, job elimination, or a divestiture.
The Board retains the right to amend or terminate the plan; provided that
the shareholders must approve any amendment that makes a material change to the
plan to the extent that shareholder approval is required to meet Internal
Revenue Code requirements.
Approximately 6,800 employees are currently eligible to participate in the
plan. If the plan as proposed had been in effect for the fiscal year ended
December 26, 1993, no amounts would have been paid under the plan for the year.
VOTE REQUIRED
Adoption of the proposed 1993 Profit Sharing Plan for Salaried Employees
requires the affirmative vote of a majority of the votes cast for or against the
proposal at the Annual Meeting of Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE ADOPTION OF THE PROPOSED
1993 PROFIT SHARING PLAN FOR SALARIED EMPLOYEES.
21

<PAGE>
SHAREHOLDER PROPOSAL ON MACBRIDE PRINCIPLES
The shareholders listed below have informed management of their intention
to present the following resolution at the Annual Meeting. The operations of
Invercon Papermills are owned by Jamont U.K. Limited in which James River owns
an approximate 43% indirect interest.
<TABLE>
<CAPTION>
NUMBER OF SHARES OF
SHAREHOLDERS JAMES RIVER COMMON STOCK HELD
<S> <C>
New York City Employees' Retirement System 230,286
New York City Police Pension Fund 71,975
New York City Fire Department Pension Fund 25,469
New York City Teachers' Retirement System 322,900
c/o Comptroller of the City of New York
1 Centre Street
New York, NY 10007-2341
The Minnesota State Board of Investment 91,486
Suite 105, MEA Building
55 Sherburne Avenue
St. Paul, MN 55155
New York State Common Retirement Fund 484,400
c/o Office of the State Comptroller
A.E. Smith State Office Building
Albany, NY 12236
</TABLE>

PROPOSED RESOLUTION (reproduced as proposed)
WHEREAS, James River has an affiliate in Northern Ireland, Invercon Papermills;
WHEREAS, employment discrimination in Northern Ireland has been cited by the
International Commission of Jurists as being one of the major causes of
the conflict in that country;
WHEREAS, Dr. Sean MacBride, founder of Amnesty International and Nobel Peace
laureate, has proposed several equal opportunity employment principles
to serve as guidelines for corporations in Northern Ireland. These
include:
1. Increasing the representation of individuals from underrepresented
religious groups in the workforce including managerial, supervisory,
administrative, clerical, and technical jobs.
2. Adequate security for the protection of minority employees both at
the workplace and while traveling to and from work.
3. The banning of provocative religious or political emblems from the
workplace.
4. All job openings should be publicly advertised and special
recruitment efforts should be made to attract applicants from
underrepresented religious groupings.
5. Layoff, recall, and termination procedures should not in practice,
favor particular religious groupings.
6. The abolition of job reservations, apprenticeship restrictions, and
differential employment criteria, which discriminate on the basis of
religion or ethnic origin.
7. The development of training programs that will prepare substantial
numbers of current minority employees for skilled jobs, including
the expansion of existing programs and the creation of new programs
to train, upgrade, and improve the skills of minority employees.
8. The establishment of procedures to assess, identify, and actively
recruit minority employees with potential for further advancement.
9. The appointment of a senior management staff member to oversee the
company's affirmative action efforts and the setting up of
timetables to carry out affirmative action principles.
22

<PAGE>
RESOLVED, Shareholders request the Board of Directors to urge its affiliate in
Northern Ireland to:
1. Make all possible lawful efforts to implement and/or increase
activity on each of the nine MacBride Principles.
PROPONENTS' STATEMENT OF SUPPORT
-- Continued discrimination and worsening employment opportunities have
been cited as contributing to support for a violent solution to Northern
Ireland's problems.
-- In May 1986, the United States District Court ruled in NYCERS v.
American Brands, 634 F. Supp. 1382 (S.D.N.Y., May 12, 1986) that "all nine of
the MacBride Principles could be legally implemented by management in its
Northern Ireland facility."
-- An endorsement of the MacBride Principles by James River's Northern
Ireland affiliate will demonstrate its concern for human rights and equality of
opportunity in its international operations. Please vote your proxy FOR these
concerns.
POSITION OF THE BOARD OF DIRECTORS OF THE COMPANY
This proposal was rejected by 88%, 84%, and 86% of the votes cast for or
against the proposal when it was previously submitted at the Annual Meetings
held on April 11, 1991, April 30, 1992, and April 22, 1993, respectively.
James River's concern for human rights and equality of opportunity is
expressed in our policy of equal employment opportunity. Our policy and practice
is to provide equal opportunity employment in all our locations without regard
to age, race, color, sex, religion, or national origin. Employment practices
that discriminate against any employee or applicant for employment are
prohibited throughout the corporation. Fairness in all transactions and
relationships is one of our fundamental values and beliefs.
The Invercon mills, which are operations of Jamont U.K. Limited in which
James River owns an approximate 43% indirect interest, market towel and tissue
products in Northern Ireland, the Republic of Ireland, and Great Britain and
manufacture such products from facilities in Larne. Invercon is in full
compliance with the requirements of the "Fair Employment (Northern Ireland) Act
1989" and actively practices fair employment as an integral part of its
personnel procedures. In all matters relating to religious equality of
opportunity, Invercon is guided by the legislation and the associated
Code of Practice.
With regard to the specific practices outlined in the MacBride Principles,
Invercon essentially complies with these practices through an established
program. Invercon is an equal opportunity employer in all job advertisements,
and hiring procedures are based on the experience and qualifications needed to
satisfy individual job requirements. Fairness is observed for all employees in
training, advancement, layoff, and recall procedures. The display of potentially
offensive religious or political emblems at the facilities is prohibited.
Security for all employees at their jobs is considered a fundamental part of
good management.
The Board is aware that the British Government has opposed such approaches
as the MacBride Principles as being likely to violate local anti-discrimination
laws. It is also a matter of concern to the Board that a wide range of political
opinion in Northern Ireland suggests that these approaches, contrary to their
intentions, would contribute to a further deterioration of the business climate
in Northern Ireland and would thus aggravate the employment problem for
Catholics and Protestants alike.
Your Board has reviewed the MacBride Principles as well as James River's
commitment to equal employment opportunity and the constructive programs already
in place at Invercon. It is our belief, on the basis of this review, that
adoption of this proposal would not contribute to improvement of Northern
Ireland employment practices nor would it further the interests of the Company's
shareholders.
VOTE REQUIRED
Adoption of this proposal requires the affirmative vote of a majority of
the votes cast for or against this proposal at the Annual Meeting of
Shareholders.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE AGAINST THIS PROPOSAL.
23

<PAGE>
OTHER MATTERS THAT MAY COME BEFORE THE MEETING
The Company has no present knowledge of any other matters to be presented
at the Annual Meeting of Shareholders. If any other matters should properly come
before the meeting, and any adjournment thereof, it is the intention of the
persons named in the accompanying Proxy to vote such Proxy with respect to any
such other matter in accordance with their best judgment.
PROPOSALS FOR 1995 ANNUAL MEETING
Any shareholder desiring to make a proposal to be acted upon at the 1995
Annual Meeting of Shareholders must present such proposal to the Corporate
Secretary of the Company, whose address is P.O. Box 2218, Richmond, Virginia
23217, not later than November 14, 1994, in order for the proposal to be
considered for inclusion in the Company's Proxy Statement. Any such proposal
must meet the applicable requirements of the Securities Exchange Act of 1934 and
the rules and regulations thereunder.
The Company's Bylaws prescribe the procedure that a shareholder must follow
to nominate directors or to bring other business before shareholders' meetings.
For a shareholder to nominate a candidate for director at the 1995 Annual
Meeting of Shareholders, notice of nomination must be given to the Corporate
Secretary of the Company not earlier than December 1, 1994, but before January
1, 1995. The notice must describe various matters regarding the nominee,
including the name, address, and occupation and the number of shares of Common
Stock held by such person. For a shareholder to bring other business before the
1995 Annual Meeting of Shareholders, notice must be given to the Corporate
Secretary of the Company between December 1, 1994, and January 1, 1995, and must
include a description of the proposed business, the reasons therefor, and other
specified matters. However, if the shareholder wishes a proposal to be
considered for inclusion in the Company's Proxy Statement, such proposal must be
presented not later than November 14, 1994, as explained above. Any shareholder
may obtain a copy of the Company's Bylaws, without charge, upon written request
to the Corporate Secretary.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR
ENDED DECEMBER 26, 1993, AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
MAY BE OBTAINED BY ANY SHAREHOLDER AFTER APRIL 15, 1994, FREE OF CHARGE, UPON
WRITTEN REQUEST TO JAMES RIVER CORPORATION OF VIRGINIA, ATTENTION: INVESTOR
RELATIONS, P.O. BOX 2218, RICHMOND, VIRGINIA 23217, OR BY CALLING (804)
343-4900.
24

<PAGE>
EXHIBIT A
JAMES RIVER CORPORATION OF VIRGINIA
STOCK PURCHASE PLAN
AMENDED AND RESTATED EFFECTIVE JULY 1, 1994
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
SECTION I ESTABLISHMENT OF STOCK PURCHASE PLAN A-3
SECTION II DEFINITIONS
2.1 Account.................................................................... A-3
2.2 Affiliated Company......................................................... A-3
2.3 Beneficiary................................................................ A-3
2.4 Board...................................................................... A-3
2.5 Canadian Employee.......................................................... A-3
2.6 Company.................................................................... A-3
2.7 Company Stock.............................................................. A-3
2.8 Company Stock Fund......................................................... A-3
2.9 Compensation............................................................... A-3
2.10 Effective Date............................................................. A-4
2.11 Employee................................................................... A-4
2.12 Employer or Employers...................................................... A-4
2.13 ERISA...................................................................... A-4
2.14 Highly Compensated Employee................................................ A-4
2.15 Insider.................................................................... A-4
2.16 Internal Revenue Code...................................................... A-4
2.17 Leave of Absence........................................................... A-4
2.18 Matching Contributions..................................................... A-4
2.19 Participant................................................................ A-4
2.20 Permanent Disability....................................................... A-4
2.21 Plan....................................................................... A-4
2.22 Plan Administrator......................................................... A-4
2.23 Plan Period................................................................ A-4
2.24 Plan Year.................................................................. A-4
2.25 Pre-Tax Contributions...................................................... A-4
2.26 Prior Plan................................................................. A-5
2.27 Retirement Date............................................................ A-5
2.28 Rule 16b-3................................................................. A-5
2.29 Service.................................................................... A-5
2.30 Taxable Compensation....................................................... A-5
2.31 Trust Agreement............................................................ A-5
2.32 Trustee.................................................................... A-5
2.33 Trust Fund................................................................. A-5
2.34 Valuation Date............................................................. A-6
SECTION III PARTICIPATION
3.1 Participation in the Salary Reduction Plan................................. A-6
3.2 Application for Participation.............................................. A-6
3.3 Duration of Participation; Reemployment.................................... A-6
SECTION IV CONTRIBUTIONS
4.1 Pre-Tax Contributions...................................................... A-6
4.2 Matching Contributions..................................................... A-6
4.3 Elections as to Contributions; Changes..................................... A-7
4.4 Time and Manner of Payment of Contributions................................ A-7
SECTION V ACCOUNTS
5.1 Participants' Accounts..................................................... A-7
5.2 Allocation of Contributions................................................ A-8
5.3 Annual Addition and Benefit Limitations.................................... A-8
5.4 Anti-Discrimination Test for Pre-Tax Contributions......................... A-9
5.5 Anti-Discrimination Test for Matching Contributions........................ A-10
5.6 Highly Compensated Employees............................................... A-11
5.7 Distribution of Excess Contributions....................................... A-12
5.8 Correction of Error........................................................ A-12
SECTION VI VESTING AND DISTRIBUTION OF ACCOUNTS
6.1 Vested Interest............................................................ A-13
6.2 Distribution Upon Termination of Employment................................ A-13
6.3 Death...................................................................... A-13
6.4 Form and Time of Payment................................................... A-13
6.5 Benefits to Minors and Incompetents........................................ A-14
</TABLE>
A-1

<PAGE>
<TABLE>
<S> <C> <C>
6.6 Location of Missing Participants........................................... A-14
6.7 No Guarantee of Values..................................................... A-15
6.8 Eligible Rollover Distributions............................................ A-15
SECTION VII WITHDRAWALS AND LOANS
7.1 Hardship Withdrawals....................................................... A-16
7.2 Withdrawals During Employment.............................................. A-17
7.3 Withdrawals During Employment by Canadian Employees........................ A-17
7.4 Loans...................................................................... A-18
7.5 Outstanding Prior Plan Loans............................................... A-20
7.6 Insiders................................................................... A-20
SECTION VIII TRUST ARRANGEMENTS
8.1 Appointment of Trustee..................................................... A-20
SECTION IX INVESTMENT OF ACCOUNTS
9.1 Investment Funds........................................................... A-20
9.2 Investment of Accounts by Participants Under Age 57........................ A-20
9.3 Investment of Accounts by Participants Age 57 or Older..................... A-21
9.4 Directed Investments....................................................... A-21
9.5 Limitations on Directed Investments........................................ A-22
9.6 Application to Beneficiaries and Alternate Payees.......................... A-22
9.7 Order of Withdrawals and Loans from the Investment Funds................... A-22
9.8 Basis of Company Stock..................................................... A-22
9.9 Limitation on Insiders' Interests in Company Stock......................... A-22
Voting, Tender and Exercise of Similar Rights with Respect to Company
9.10 Stock.................................................................... A-23
Trustee's Responsibilities With Respect to Management of the Company Stock
9.11 Fund..................................................................... A-23
9.12 Allocation of Income in Company Stock Fund................................. A-23
Allocation of Income in Investment Funds Other Than the Company Stock
9.13 Fund..................................................................... A-24
SECTION X GENERAL PROVISIONS
10.1 Nonalienation of Benefits.................................................. A-24
10.2 Merger or Consolidation.................................................... A-24
10.3 No Contract of Employment.................................................. A-24
10.4 Non-Reversion.............................................................. A-24
10.5 Construction and Severability.............................................. A-24
10.6 Delegation of Authority.................................................... A-25
10.7 Changes in Capital Structure............................................... A-25
10.8 Receipt of Rollovers and Trustee-to-Trustee Transfers...................... A-25
10.9 Gender and Number.......................................................... A-25
SECTION XI PLAN ADMINISTRATION
11.1 Plan Administrator......................................................... A-25
11.2 Responsibilities........................................................... A-25
11.3 Delegation of Duties....................................................... A-26
11.4 Expenses................................................................... A-26
11.5 Compensation............................................................... A-26
11.6 Facility of Payment........................................................ A-26
11.7 Benefit Claims Procedure................................................... A-26
11.8 Domestic Relations Orders.................................................. A-27
SECTION XII AMENDMENT OF PLAN
12.1 Reserved Power to Modify, Suspend or Terminate............................. A-28
12.2 Amendment Requiring Shareholder Approval................................... A-28
12.3 Distribution on Termination of Plan........................................ A-28
SECTION XIII ADOPTION OF PLAN BY AFFILIATED COMPANIES
13.1 Adoption of the Plan....................................................... A-28
13.2 Withdrawal................................................................. A-28
13.3 Sale of Employer or Division............................................... A-28
SECTION XIV TOP HEAVY
14.1 Top Heavy.................................................................. A-28
14.2 Minimum Allocation......................................................... A-29
14.3 Compensation Limitation.................................................... A-29
14.4 Benefit and Contribution Limitations....................................... A-29
</TABLE>

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SECTION I
ESTABLISHMENT OF STOCK PURCHASE PLAN
James River Corporation of Virginia maintains this Stock Purchase Plan (the
Plan) for the benefit of its eligible Employees and the eligible Employees of
its Affiliated Companies. The Plan is hereby amended and restated as of July 1,
1994. The Plan, as amended and restated, is intended to be a qualified profit
sharing plan under Sections 401(a) and 401(k) of the Internal Revenue Code. The
Plan is also intended, to the extent permissible, to qualify as a Section 404(c)
plan for the purposes of the Employee Retirement Income Security Act of 1974, as
amended.
SECTION II
DEFINITIONS
Whenever used in the Plan, the following terms shall have the meanings set
forth below unless otherwise expressly provided:
2.1 ACCOUNT means a Participant's interest in the Trust Fund, which shall
consist of the Participant's Accounts described in Section 5.1.
2.2 AFFILIATED COMPANY means (a) any organization under common control (as
described in Sections 414(b) and (c) of the Internal Revenue Code) with the
Company or (b) any organization that is a member of an affiliated service group
(as described in Section 414(m) of the Internal Revenue Code) of which the
Company is a member.
2.3 BENEFICIARY means the person or entity who is to receive any benefits
payable from the Plan on account of a Participant's death. If the Participant is
married, the Beneficiary is the Participant's surviving spouse and no written
designation is required. If the Participant is not married, or if the
Participant is married and the spouse consents, the Beneficiary is the person
designated to receive such benefits. If, at the time of his death, a Participant
has no spouse or designated Beneficiary, the Beneficiary is the personal
representative of the Participant's estate, provided that satisfactory evidence
of the appointment of a personal representative is furnished to the Plan
Administrator within 90 days after the Participant's death. If no such evidence
is received by the Plan Administrator, then the deceased Participant's
Beneficiary shall be the Participant's distributees, as provided by law. A
Participant may designate a person or entity to be his Beneficiary by filing a
properly completed and executed form with the Plan Administrator. The
interpretation of the Plan Administrator with respect to the designation of a
Beneficiary shall be binding and conclusive upon all parties, and no person who
claims to be a Beneficiary or any other person shall have the right to question
any action of the Plan Administrator that, in the judgment of the Plan
Administrator, fulfills the intent of the Participant who filed the designation.
A Participant's Beneficiary is bound by the terms of the Plan.
2.4 BOARD means the Board of Directors of the Company.
2.5 CANADIAN EMPLOYEE means an Employee of James River-Marathon, Ltd.,
Canada Cup Inc., or any other Canadian Employer.
2.6 COMPANY means James River Corporation of Virginia and any successor by
merger or otherwise.
2.7 COMPANY STOCK means common stock issued by the Company.
2.8 COMPANY STOCK FUND means the investment fund maintained under the Plan
for the investment of Participants' Accounts in shares of Company Stock.
2.9 COMPENSATION means total wages paid or otherwise payable in cash to an
Employee by his Employer during a Plan Year for personal services, including any
salary continuation payments made under the James River Corporation Salary
Continuation Plan to an Employee whose position is eliminated, but excluding
payments under any other severance, salary continuation or layoff program and
excluding salary continuation payments under the James River Corporation Salary
Continuation Plan to an Employee who is involuntarily separated because of the
Employee's inability to perform satisfactorily his job. Compensation shall also
exclude bonuses, director's fees, reimbursement of moving expenses, compensation
received in connection with insurance, stock options or other benefit plans, and
any deferred compensation or other plan or program of deferred compensation.
Compensation shall be determined without regard to any reduction in remuneration
resulting from an election to have Pre-Tax Contributions made on his behalf
pursuant to the Plan. In the case of an Employee who is employed
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<PAGE>
by two or more Employers, the Employee's aggregate Compensation from all
Employers shall be deemed to be his Compensation. Effective for Plan Years
beginning after December 31, 1993 the total amount of annual Compensation taken
into account under the Plan for an Employee may not exceed $150,000, or an
adjusted amount determined pursuant to Sections 401(a)(17) and 415(d) of the
Internal Revenue Code. For purposes of the anti-discrimination tests of Sections
5.4 and 5.5, Compensation means compensation for services performed for the
Employer that is currently includable in gross income, increased by the
Employee's Pre-Tax Contributions, elective contributions under a cafeteria plan
and elective contributions under other arrangements permitted to be included
under Section 414(s) of the Internal Revenue Code.
2.10 EFFECTIVE DATE means, for the amended and restated Plan, July 1, 1994.
The original effective date of the Plan was June 29, 1973.
2.11 EMPLOYEE means a person employed by an Employer, other than as an
independent contractor.
2.12 EMPLOYER OR EMPLOYERS means the Company and any Affiliated Company
that adopts the Plan with the consent of the Board.
2.13 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations issued thereunder.
2.14 HIGHLY COMPENSATED EMPLOYEE means an Employee described in Section
5.6.
2.15 INSIDER means a person designated as an insider for purposes of
Section 16 of the Securities Exchange Act of 1934.
2.16 INTERNAL REVENUE CODE means the Internal Revenue Code of 1986, as
amended, or any subsequently enacted Federal revenue law. A reference to a
particular section of the Internal Revenue Code shall include a reference to any
regulations issued under the section and to the corresponding section of any
subsequently enacted Federal revenue law.
2.17 LEAVE OF ABSENCE means an Employee's absence without loss of
employment status (regardless of whether Compensation is paid) if such absence
is authorized by his Employer pursuant to uniformly applied standards because of
injury, illness, the business of the Employer or personal reasons. Leave of
Absence also includes service in the Armed Forces of the United States, provided
that the Employee returns to the employment of an Employer within the period of
time during which his re-employment rights as a veteran are protected by law.
2.18 MATCHING CONTRIBUTIONS means contributions made by an Employer
pursuant to Section 4.2.
2.19 PARTICIPANT means any person who is an eligible Employee described in
Section 3.1 and who elects to participate in the Plan.
2.20 PERMANENT DISABILITY means a disability that has rendered a
Participant incapable of performing his customary or other comparable duties for
his Employer. No Participant shall be declared Permanently Disabled unless his
condition has existed for at least six consecutive months. A Participant shall
not be deemed to be disabled if his incapacity arose while he was participating
in a felonious criminal enterprise, if his incapacity resulted from his having
engaged in a felonious criminal enterprise, or if his incapacity was a result of
injury or disease incurred while in the military service of the United States
(or another country) for which the Participant receives disability income
benefits. The Plan Administrator shall determine whether a Participant has
incurred a Permanent Disability in accordance with uniform principles
consistently applied on the basis of such evidence as it deems necessary and
advisable. The Plan Administrator may employ one or more physicians to examine a
Participant and to investigate health or medical statements made by or on behalf
of a Participant and may rely upon such evidence as it deems sufficient. The
Plan Administrator's determination as to a Participant's Permanent Disability
shall be final.
2.21 PLAN means this Stock Purchase Plan, as amended from time to time.
2.22 PLAN ADMINISTRATOR means the committee responsible for administering
the Plan, as described in Section 11.
2.23 PLAN PERIOD means a three-month period beginning on January 1, April
1, July 1 or October 1 of a Plan Year.
2.24 PLAN YEAR means the calendar year.
2.25 PRE-TAX CONTRIBUTIONS means contributions made by an Employer pursuant
to Section 4.1.
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2.26 PRIOR PLAN means the James River Corporation of Virginia Stock
Purchase Plan, as in effect before the Effective Date of the restated Plan.
2.27 RETIREMENT DATE means the first to occur of (a) the date on which the
Participant has attained age 55 and has completed 15 years of Service, or (b)
the date on which the Participant attains age 59 1/2.
2.28 RULE 16b-3 means Rule 16b-3 of the Securities Exchange Act of 1934,
including any corresponding subsequent rule or amendments thereto.
2.29 SERVICE means an Employee's period of employment with the Employer and
Affiliated Companies, beginning with the Employee's employment commencement date
and ending with his severance from service date, and including the following:
(a) An Employee's Service shall include periods during which the Employee
was on a Leave of Absence or was laid off because of lack of work.
(b) An Employee's Service shall include periods of service, as described
above, with a predecessor employer whose stock or assets are acquired by an
Employer or an Affiliated Company, except to the extent that the Board provides
otherwise.
(c) Transfers between Employers or Affiliated Companies shall not be deemed
terminations of Service.
An Employee's employment commencement date is the date on which he first
performs an hour of service for the Employer or an Affiliated Company. An
Employee's severance from service date is the first to occur of (i) the date on
which an Employee terminates employment with the Employer and Affiliated
Companies because he quits, is discharged, dies or retires or (ii) the first
anniversary of the date on which the Employee is absent (with or without pay)
from employment for any other reason (such as vacation, holiday, sickness,
disability, leave of absence or layoff), if the Employee is still absent as of
the anniversary date. This Section shall be administered in accordance with
applicable Department of Labor regulations.
2.30 TAXABLE COMPENSATION means the total annual compensation paid to an
Employee by the Employer and Affiliated Companies during a Plan Year, as defined
in the Treasury Regulations issued under Section 415 of the Internal Revenue
Code. Taxable Compensation includes an Employee's wages, salaries, fees for
professional services and other amounts received for personal services actually
rendered in the course of employment with the Employer and Affiliated Companies
(including, but not limited to, commissions paid to salesmen, compensation for
services on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses). Except as provided below, Taxable Compensation does
not include items such as:
(a) Salary reduction contributions and other contributions made by the
Employer or an Affiliated Company to a plan of deferred compensation to the
extent that the contributions are not includable in the Employee's gross income
for the taxable year in which they are contributed.
(b) Amounts received from the exercise of a non-qualified stock option or
from restricted property.
(c) Amounts realized from the sale, exchange or other disposition of stock
acquired under a statutory stock option.
(d) Other amounts that receive special tax benefits, such as premiums for
group term life insurance (but only to the extent that the premiums are not
includable in the gross income of the Employee).
Effective for Plan Years beginning after December 31, 1993, the amount of
annual Taxable Compensation taken into account under the Plan for an Employee
may not exceed $150,000, or an adjusted amount determined pursuant to Sections
401(a)(17) and 415(d) of the Internal Revenue Code. For purposes of Section 5.6,
Taxable Compensation includes Pre-Tax Contributions, elective contributions
under a cafeteria plan, and elective contributions under other arrangements
required to be included under Section 414(q) of the Internal Revenue Code.
2.31 TRUST AGREEMENT means the Trust Agreement for the Plan, which was
entered into to create a Trust Fund to receive, hold, invest and dispose of
assets under the Plan.
2.32 TRUSTEE means NationsBank of Virginia, N.A., and any successor Trustee
selected by the Board to hold and administer the Trust Fund. The Trustee shall
be a fiduciary with respect to the Trust Fund.
2.33 TRUST FUND means the assets held by the Trustee under the Trust
Agreement.
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2.34 VALUATION DATE means the last day of each calendar month, or such
other, more frequent, date as the Plan Administrator may designate.
SECTION III
PARTICIPATION
3.1 PARTICIPATION IN THE SALARY REDUCTION PLAN.
(a) Each Employee who was eligible to participate in the Prior Plan
immediately before the Effective Date shall be eligible to be a Participant in
the Plan as of the Effective Date.
(b) Each Employee who is not eligible to become a Participant pursuant to
subsection (a) shall be eligible to become a Participant as of the later of (i)
the date on which the Employee commences employment with the Employer or (ii)
July 1, 1994.
(c) Notwithstanding the foregoing, any Canadian Employee who is not already
a Participant as of the Effective Date of the amended and restated Plan shall
not be eligible to participate in the Plan.
3.2 APPLICATION FOR PARTICIPATION.
(a) Participation in the Plan shall be voluntary. An eligible Employee may
elect to participate in the Plan by submitting an application in such form and
at such time as the Plan Administrator shall designate. The election must be
made before the date as of which the Employee's election to become a Participant
will be effective.
(b) When the Employer or an Affiliated Company acquires the stock or assets
of a company, the Plan Administrator may establish a special enrollment period
during which eligible Employees of that company may elect to participate in the
Plan.
3.3 DURATION OF PARTICIPATION; REEMPLOYMENT. A Participant shall continue
to be a Participant until he no longer has assets credited to his Account. If a
Participant or a person who was formerly a Participant terminates employment and
then is reemployed by an Employer, he shall be eligible to be a Participant upon
his reemployment.
SECTION IV
CONTRIBUTIONS
4.1 PRE-TAX CONTRIBUTIONS. A Participant who is eligible to participate in
the Plan may elect to have Pre-Tax Contributions made on his behalf by entering
into a salary reduction agreement with his Employer in such form and at such
time as the Plan Administrator shall designate. Under the agreement, his
Employer will agree to reduce the Participant's Compensation by a designated
percentage and to contribute that designated percentage to the Plan for the
benefit of the Participant. The designated percentage may be from 1% to 10% of
Compensation, provided that:
(a) At any time during the Plan Year, the Plan Administrator may limit the
percentage of Compensation that may be contributed for the benefit of Highly
Compensated Employees, and
(b) The maximum amount of Pre-Tax Contributions that may be made on behalf
of a Participant during a calendar year is $7,000, or an adjusted amount as
determined pursuant to Sections 402(g) and 415(d) of the Internal Revenue Code.
4.2 MATCHING CONTRIBUTIONS.
(a) Matching Contributions shall be made only with respect to a
Participant's Pre-Tax Contributions that are invested in the Company Stock Fund
pursuant to Section 9.2, if the Participant has not attained age 57. If the
Participant has attained age 57, Matching Contributions shall be made with
respect to the Participant's Pre-Tax Contributions, regardless whether the Pre-
Tax Contributions are invested in the Company Stock Fund.
(b) Each Employer shall make a Matching Contribution for its Participants
equal to the following percentage of its Participants' Pre-Tax Contributions
made on or after July 1, 1994 that qualify for a Matching Contribution pursuant
to subsection (a):
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<PAGE>
<TABLE>
<CAPTION>
THE EMPLOYER SHALL
MAKE MATCHING CONTRIBUTIONS
EQUAL TO THE FOLLOWING
PERCENTAGE OF THE
PARTICIPANT'S PRE-TAX
IF A PARTICIPANT'S PRE-TAX CONTRIBUTIONS DESCRIBED
CONTRIBUTIONS ARE: IN SUBSECTION (A):
<S> <C>
1% of Compensation 120%
2% of Compensation 100%
3% of Compensation 90%
4% of Compensation 80%
5% of Compensation 70%
6% of Compensation 60%
</TABLE>

The Employer shall make no Matching Contribution with respect to the
portion of a Participant's Pre-Tax Contributions that exceed 6% of the
Participant's Compensation. Except with respect to Participants who have
attained age 57, Matching Contributions will not be made with respect to Pre-Tax
Contributions that are not invested in the Company Stock Fund pursuant to
Section 9.2.
(c) Matching Contributions shall be made with respect to a Participant's
Pre-Tax Contributions, regardless whether the Participant ceases to be an
Employee before the Matching Contribution is made.
4.3 ELECTIONS AS TO CONTRIBUTIONS; CHANGES.
(a) A Participant may elect to have Pre-Tax Contributions made on his
behalf, to change the contribution percentage prospectively, or to request a
suspension or resumption of contributions by submitting an appropriate
application, salary reduction agreement, or request in such form and at such
time as the Plan Administrator shall designate. The Plan Administrator shall
allow Participants to make such elections at least monthly. All elections made
by a Participant shall continue in force until they are changed or until the
Participant ceases to be a Participant.
(b) A Participant's right to have Pre-Tax Contributions made on his behalf
shall be automatically suspended during any Leave of Absence during which the
Participant receives no Compensation. When the Participant returns to employment
with his Employer, his contributions will resume as of the date of his return to
employment at the contribution rate in effect at the time his Leave of Absence
began, unless the Participant elects to suspend or change the rate of
contributions.
(c) If a Participant's Pre-Tax Contributions are suspended pursuant to
Section 7.1(c), the Participant may resume Contributions at such time as the
Plan Administrator may designate after the suspension period required by Section
7.1(c).
(d) A Participant shall not be permitted to make up suspended
contributions, and Matching Contributions shall not be made for a Participant
with respect to any suspended contributions.
4.4 TIME AND MANNER OF PAYMENT OF CONTRIBUTIONS.
(a) Pre-Tax Contributions shall be paid to the Trustee as of the earliest
date on which they can reasonably be segregated from the Employer's general
assets.
(b) Matching Contributions shall be paid to the Trustee at least monthly.
Matching Contributions may be made in cash or in Company Stock or in any
combination of the two.
SECTION V
ACCOUNTS
5.1 PARTICIPANTS' ACCOUNTS. The following Accounts, with such subaccounts
as the Plan Administrator deems appropriate, shall be maintained for each
Participant:
(a) MATCHED PRE-TAX CONTRIBUTIONS ACCOUNT, to which shall be credited
Pre-Tax Contributions made on or after the Effective Date which are matched by
the Employer with Matching Contributions;
(b) UNMATCHED PRE-TAX CONTRIBUTIONS ACCOUNT, to which shall be credited
Pre-Tax Contributions made on or after the Effective Date which are not matched
by the Employer with Matching Contributions;
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(c) MATCHING CONTRIBUTIONS ACCOUNT, to which shall be credited Matching
Contributions made on or after the Effective Date and the balance of the
Participant's Salary Reduction Matching Account under the Prior Plan, and
earnings thereon;
(d) PRE-TAX CONTRIBUTIONS ROLLOVER ACCOUNT, to which shall be credited
assets transferred from other plans that are attributable to pre-tax
contributions, and earnings thereon;
(e) AFTER-TAX CONTRIBUTIONS ROLLOVER ACCOUNT, to which shall be credited
assets transferred from other plans that are attributable to after-tax
contributions, and earnings thereon;
(f) EMPLOYER CONTRIBUTIONS ROLLOVER ACCOUNT, to which shall be credited
assets transferred from other plans that are attributable to employer
contributions (other than pre-tax contributions), and earnings thereon;
(g) PRIOR PLAN PRE-TAX CONTRIBUTIONS ACCOUNT, to which shall be credited
the balance of the Participant's Basic Salary Reduction Account, Additional
Salary Reduction Account, and Salary Reduction Rollover Account under the Prior
Plan as of the Effective Date, and all earnings thereon;
(h) PRIOR PLAN AFTER-TAX CONTRIBUTIONS ACCOUNT, to which shall be credited
the balance of the Participant's Basic Non-Tax-Deferred Account, Additional
Non-Tax-Deferred Account, and Non-Tax-Deferred Rollover Account under the Prior
Plan as of the Effective Date, and all earnings thereon; and
(i) PRIOR PLAN MATCHING CONTRIBUTIONS ACCOUNT, to which shall be credited
the balance of the Participant's Matching Account under the Prior Plan, as of
the Effective Date, other than the Participant's Salary Reduction Matching
Account under the Prior Plan, and all earnings thereon. The Participant's
Dividend Account and Employer Contributions Rollover Account under the Prior
Plan as of the Effective Date, and all earnings thereon, shall also be credited
to this Account.
The Plan Administrator may combine or eliminate any of the Accounts
described above at such time as the Plan Administrator deems appropriate.
5.2 ALLOCATION OF CONTRIBUTIONS. As of each Valuation Date, the Plan
Administrator shall allocate to the Accounts of each Participant the
contributions made for the Participant's benefit since the preceding Valuation
Date.
5.3 ANNUAL ADDITION AND BENEFIT LIMITATIONS.
(a) Notwithstanding the foregoing, the total amount of the Annual
Additions, as defined hereafter, that may be allocated to the Accounts of a
Participant for a Plan Year under all defined contribution plans maintained by
the Employer and Affiliated Companies shall not exceed the lesser of (i) $30,000
or (ii) 25% of the Participant's Taxable Compensation. The $30,000 amount
referred to above shall be adjusted from time to time to correspond to the
amount prescribed by law under Section 415(c)(1)(A) of the Internal Revenue Code
or by the Secretary of the Treasury pursuant to Section 415(d) of the Internal
Revenue Code, determined as of the last day of the Plan Year to which the
limitation applies. The Plan Year shall be the limitation year used to determine
whether the requirements of this Section have been satisfied.
(b) For purposes of this Section, Annual Additions for a Participant means
the sum (under all defined contribution plans maintained by the Employer and
Affiliated Companies) of (i) Pre-Tax Contributions, Matching Contributions and
other Employer and Affiliated Company contributions made on his behalf, (ii)
forfeitures credited to his Accounts and (iii) other voluntary contributions
made by the Participant. Annual Additions shall not include excess Pre-Tax
Contributions that are distributed by April 15 following the calendar year in
which the contributions were made, pursuant to Section 5.7.
(c) If a Participant is or has been a participant in one or more defined
benefit plans and in one or more defined contribution plans maintained by the
Employer or an Affiliated Company, then the sum of the Participant's defined
benefit plan fraction (defined below) and his defined contribution plan fraction
(defined below) for any Plan Year as applied to the plans shall not exceed 1.0.
The benefits provided under the defined benefit plans shall be reduced to comply
with the limits of this subsection (c) before the contributions made to the
defined contribution plans are reduced. For purposes of this Section:
(i) The defined benefit plan fraction for any Participant for any
Plan Year is a fraction, the numerator of which is the Participant's
projected annual benefit under all defined benefit plans of the Employer
and Affiliated Companies (determined as of the close of the Plan Year)
and the denominator of which is the lesser of:
(x) The product of 1.25 multiplied by $90,000 (or such other
amount as is permitted or required to be used under Section 415(e) of
the Internal Revenue Code), or
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<PAGE>
(y) The product of 1.4 multiplied by 100% of the Participant's
highest average Taxable Compensation for the three consecutive years
during which he was a participant in the defined benefit plans.
(ii) The defined contribution plan fraction for any Participant for
any Plan Year is a fraction, the numerator of which is the sum of the
Annual Additions to the Participant's Accounts as of the close of the
Plan Year under all defined contribution plans of the Employer and
Affiliated Companies, and the denominator of which is the sum of the
lesser of the following amounts determined for the Plan Year and for
each previous year of service with the Employer and Affiliated
Companies:
(x) The product of 1.25 multiplied by the $30,000 amount
described in subsection (a) (as adjusted), or
(y) The product of 1.4 multiplied by 25% of the Participant's
Taxable Compensation for the Plan Year.
As an alternative to the foregoing, in determining the limits of this
subsection (c), the Plan Administrator may use any other method permissible
under Section 415 of the Internal Revenue Code.
(d) As of the last day of each Plan Year, any excess Annual Additions shall
be held in a suspense account and used to reduce contributions for the
Participant for the next Plan Year (and succeeding Plan Years, as necessary). If
the Participant is no longer a Participant at the end of a Plan Year, the excess
amount will be used to reduce contributions for the Plan Year (and succeeding
Plan Years) for all Participants who are employed by the Employer with which the
Participant was employed.
5.4 ANTI-DISCRIMINATION TEST FOR PRE-TAX CONTRIBUTIONS.
(a) Notwithstanding the foregoing provisions of the Plan, the Plan shall
meet the anti-discrimination test of Section 401(k) of the Internal Revenue Code
(described in subsection (b)) for each Plan Year. In order to ensure that the
anti-discrimination test is met, the Plan Administrator shall direct the
Employer to adjust the Pre-Tax Contributions for the Plan Year to the extent
necessary to meet the requirements of Section 401(k) of the Internal Revenue
Code and shall instruct the Employer as to how such adjustment shall be made. An
adjustment to Pre-Tax Contributions shall be accomplished by (i) requiring each
Highly Compensated Employee to reduce (or eliminate) the Pre-Tax Contributions
to be made on his behalf for the Plan Year, (ii) returning Pre-Tax Contributions
made on behalf of Highly Compensated Employees to the Employees as of the end of
the Plan Year, in the manner described in Section 5.7, (iii) making an
additional, fully vested Employer contribution to the Plan, which shall be
administered as an additional Pre-Tax Contribution, for Participants who are not
Highly Compensated Employees and who elected to have Pre-Tax Contributions made
for the Plan Year, or (iv) taking such other actions as the Plan Administrator
deems appropriate. If the Employer makes an additional, fully vested Employer
contribution to the Plan pursuant to subparagraph (iii) above, the contribution
shall be paid to Trustee no later than the end of the twelve-month period
immediately following the Plan Year to which the contribution relates.
(b) The anti-discrimination requirements of Section 401(k) of the Internal
Revenue Code require that, in each Plan Year, one of the following tests must be
met:
(i) The Actual Deferral Percentage (defined below) of the Highly
Compensated Employees is not more than the Actual Deferral Percentage of
all other eligible Employees multiplied by 1.25; or
(ii) The excess of the Actual Deferral Percentage of the Highly
Compensated Employees over that of the other eligible Employees is not
more than 2 percentage points, and the Actual Deferral Percentage of the
Highly Compensated Employees is not more than the Actual Deferral
Percentage of all other eligible Employees multiplied by 2.
(c) The Actual Deferral Percentage is the average of the ratios, calculated
separately for each Employee who is eligible to participate in the Plan, of the
amount of Pre-Tax Contributions that are credited under the Plan on behalf of
the eligible Employee for the Plan Year, to the Employee's Compensation for the
Plan Year. Matching Contributions allocated to Participants' Matching
Contributions Accounts may be included in computing the Actual Deferral
Percentage for a Plan Year, if the Plan Administrator determines that inclusion
of such contributions is appropriate. As described in subsection (b), the Actual
Deferral Percentage of the Highly Compensated Employees shall be compared to the
Actual Deferral Percentage of all other eligible Employees. The limitations of
Section 5.4(b)(ii) shall be used only to the extent permitted by applicable
Treasury regulations.
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(d) Notwithstanding the foregoing, if the test described in subsection (b)
is not satisfied for a Plan Year, the Plan Administrator may use any other test
permitted under Section 401(k) of the Internal Revenue Code to determine whether
the Plan meets the anti-discrimination requirements of Section 401(k) of the
Internal Revenue Code.
(e) If the Company maintains more than one plan qualified under Internal
Revenue Code Section 401(a), and if the plans are aggregated for purposes of
satisfying the coverage or anti-discrimination requirements of Section 401(a) or
410(b)(1)(A) or (B) of the Internal Revenue Code, all qualified cash or deferred
arrangements contained in such plans shall be aggregated for purposes of
performing the anti-discrimination test for Pre-Tax Contributions. If a Highly
Compensated Employee participates in more than one plan of the Company, all
Pre-Tax Contributions made by the Highly Compensated Employee under all such
plans shall be aggregated for purposes of performing the test described in
subsection (b), above. The Plan Administrator shall administer the
anti-discrimination tests of Sections 5.4 and 5.5 and in accordance with
Internal Revenue Service rulings and Treasury regulations in effect from time to
time.
(f) In the case of a Highly Compensated Employee described in Section
5.6(d), the Actual Deferral Percentage for such Highly Compensated Employee
shall be the greater of (i) the Actual Deferral Percentage determined by
combining the contributions and Compensation of all of the Employee's family
members who are eligible to participate in the Plan and who are Highly
Compensated Employees (without regard to family aggregation) or (ii) the Actual
Deferral Percentage determined by combining the contributions and Compensation
of all family members of the Employee eligible to participate in the Plan.
5.5 ANTI-DISCRIMINATION TEST FOR MATCHING CONTRIBUTIONS.
(a) Notwithstanding the foregoing provisions of the Plan, the Plan shall
meet the anti-discrimination test of Section 401(m) of the Internal Revenue Code
(described in subsection (b)) for each Plan Year. In order to meet the
anti-discrimination test, the Plan Administrator shall reduce the Matching
Contributions for the Plan Year to the extent necessary to meet the requirements
of Section 401(m) of the Internal Revenue Code, in the manner described in
Section 5.7. The Plan Administrator may also take such other actions to reduce
Matching Contributions as the Plan Administrator deems appropriate, including,
without limitation, actions similar to those described in Section 5.4(a).
(b) The anti-discrimination requirements of Section 401(m) of the Internal
Revenue Code require that, in each Plan Year, one of the following tests must be
met.
(i) The Contribution Percentage (defined below) of the Highly
Compensated Employees is not more than the Contribution Percentage of
all other eligible Employees multiplied by 1.25; or
(ii) The excess of the Contribution Percentage of the Highly
Compensated Employees over that of the other eligible Employees is not
more than 2 percentage points, and the Contribution Percentage of the
Highly Compensated Employees is not more than the Contribution
Percentage of all other eligible Employees multiplied by 2.
(c) The Contribution Percentage is the average of the ratios, calculated
separately for each eligible Employee, of the amount of Matching Contributions
that are credited under the Plan on behalf of the eligible Employee for the Plan
Year, to the Employee's Compensation for the Plan Year. Pre-Tax Contributions
may be included in computing the Contribution Percentage for a Plan Year, if the
Plan Administrator determines that inclusion of such contributions is
appropriate. However, Matching Contributions used to satisfy the
anti-discrimination test described in Section 5.4(b) shall not be taken into
account for purposes of the anti-discrimination test described in subsection (b)
above, to the extent required by law. As described in subsection (b), the
Contribution Percentage of the Highly Compensated Employees shall be compared to
the Contribution Percentage of all other eligible Employees.
(d) Notwithstanding the foregoing, if the test described in subsection (b)
is not satisfied for a Plan Year, the Plan Administrator may use any other test
permitted under Section 401(m) of the Internal Revenue Code to determine whether
the Plan meets the anti-discrimination requirements of Section 401(m) of the
Internal Revenue Code. The limitations of Section 5.5(b) shall be used only to
the extent permitted by applicable Treasury regulations.
(e) If the Company maintains more than one plan qualified under Section
401(a) of the Internal Revenue Code, and if the plans are aggregated for
purposes of satisfying the discrimination or coverage requirements of Section
401(a)(4) or 410(b)(1)(A) or (B) of the Internal Revenue Code, all Matching
Contributions made to such plans will be aggregated for purposes of performing
the anti-discrimination test described in subsection (b) above. If a Highly
Compensated Employee is eligible to participate in more than one plan maintained
by the Company, Matching Contributions made on behalf of the
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Highly Compensated Employee under all such plans will be aggregated for purposes
of performing the anti-discrimination test described in subsection (b) above.
(f) In the case of a Highly Compensated Employee described in Section
5.6(d), the percentage derived in subsection (b) above shall be the greater of
the percentage derived in subsection (b), determined by combining the
contributions and Compensation of all of the Employee's contributions and
Compensation of all of the Employee's family members who are eligible to
participate in the plan and who are Highly Compensated Employees (without regard
to family aggregation), and the percentage determined under subsection (b)
determined by combining the contributions and Compensation of all family members
who are eligible to participate in the plan.
(g) Notwithstanding any other provision of the Plan, the sum of the Actual
Deferral Percentage and the Contribution Percentage (as defined above) on behalf
of Highly Compensated Employees may not exceed the aggregate limit permitted
under the multiple use test, as set forth in Treasury Regulation section
1.401(m)-2(b). If the aggregate limit is exceeded, then the Matching
Contributions of those Highly Compensated Employees who participate in the Plan
will be reduced (beginning with such Highly Compensated Employee whose
percentage is the highest) so that the limit is not exceeded. The amount by
which each Highly Compensated Employee's Contribution Percentage is reduced
shall be treated as an excess contribution under Section 5.7(c). The Actual
Deferral Percentage and the Contribution Percentage of the Highly Compensated
Employees are determined after any correction required to be made under this
subsection (g). Multiple use does not occur if both the Actual Deferral
Percentage and the Contribution Percentage of the Highly Compensated Employees
does not exceed 1.25 multiplied by the Actual Deferral Percentage and the
Contribution Percentage of the non-Highly Compensated Employees.
5.6 HIGHLY COMPENSATED EMPLOYEES.
(a) Except as otherwise provided below, in computing the
anti-discrimination tests described in Sections 5.4 and 5.5, a Highly
Compensated Employee is an Employee who, during the Plan Year or the preceding
Plan Year:
(i) Was at any time a 5% owner of the Employer or an Affiliated
Company,
(ii) Received Taxable Compensation from the Employer and Affiliated
Companies in excess of $75,000,
(iii) Received Taxable Compensation from the Employer and
Affiliated Companies in excess of $50,000 and was in the top 20% of the
Employees, when ranked on the basis of Taxable Compensation paid during
the Plan Year, or
(iv) Was at any time an officer and received Taxable Compensation
greater than 50% of the amount in effect under Section 415(b)(1)(A) of
the Internal Revenue Code for the Plan Year.
The determination of Highly Compensated Employees shall be made in
accordance with Section 414(q) of the Internal Revenue Code.
(b) In determining who are Highly Compensated Employees for a Plan Year, an
Employee who was not described in subsection (a)(ii), (iii) or (iv) above for
the preceding Plan Year (without regard to this subsection) shall not be treated
as described in subsection (a)(ii), (iii) or (iv) for the current Plan Year,
unless the Employee is one of the 100 Employees who are paid the most Taxable
Compensation during the current Plan Year.
(c) For purposes of determining who are officers, not more than 50
Employees (or, if less, the greater of three Employees or 10% of all Employees)
shall be treated as officers. If no officer of the Employer or Affiliated
Company receives the amount of Taxable Compensation described in subsection
(a)(iv) above, the highest paid officer for the Plan Year shall be treated as
described in subsection (a)(iv).
(d) If any person is a family member of a 5% owner or a family member of
one of the ten Highly Compensated Employees who are paid the most Taxable
Compensation during a Plan Year, then (i) the person shall not be considered a
separate Employee for purposes of this Section and (ii) any Compensation paid to
the person (and any applicable contribution or benefit on his behalf) shall be
treated as if it were paid to (or on behalf of) the 5% owner or Highly
Compensated Employee.
(e) For purposes of determining the number of Employees in the top paid
group described in subsection (a)(iii), the following Employees may be excluded:
(i) Employees who have not completed six months of service,
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(ii) Employees who normally work less than 17-1/2 hours per week,
(iii) Employees who normally work during not more than six months
during any Plan Year,
(iv) Employees who have not attained age 21,
(v) Employees whose terms of employment are covered by a collective
bargaining agreement between Employee representatives and the Employer
or an Affiliated Company, and
(vi) Employees who are non-resident aliens and who receive no
United States earned income from the Employer or Affiliated Companies.
(f) A Highly Compensated Employee includes a former Employee who separated
from service prior to the Plan Year for which the determination was made and who
was an active Highly Compensated Employee for either (i) such Employee's
separation year or (ii) any Plan Year ending on or after the Employee's 55th
birthday.
5.7 DISTRIBUTION OF EXCESS CONTRIBUTIONS.
(a) If a Participant's Pre-Tax Contributions exceed the Internal Revenue
Code Section 402(g) limit described in Section 4.1(a) for a calendar year, the
amount of Pre-Tax Contributions in excess of the limit and income attributable
to those contributions shall be distributed to the Participant by the first
April 15 following the close of the calendar year in which the Pre-Tax
Contributions were made.
(b) If Pre-Tax Contributions of Highly Compensated Employees are required
to be reduced as a result of the anti-discrimination test described in Section
5.4, the excess Pre-Tax Contributions and income attributable to those
contributions shall be distributed to the Highly Compensated Employees within
2 1/2 months after the close of the Plan Year to which the Pre-Tax Contributions
relate.
(c) If Matching Contributions of Highly Compensated Employees are required
to be reduced as a result of the anti-discrimination test described in Section
5.5, the excess Matching Contributions and income attributable to those
contributions shall be distributed to the Highly Compensated Employees within
2 1/2 months after the close of the Plan Year to which the contributions relate.
In determining the amount of the distributions under this Section and Section
5.7(b), the Plan Administrator shall use the leveling method described in
applicable Treasury regulations or any other method allowed by the Internal
Revenue Service.
(d) The amount of income attributable to excess contributions is that
portion of the income on the Participant's Account to which the contributions
were allocated for the Plan Year that bears the same ratio as the amount of
excess contributions bears to the total balance of that Account.
(e) The distributions required under this Section may be made without the
consent of the Participant or his spouse and may be made without regard to any
Qualified Domestic Relations Order.
(f) In order to comply with the applicable Internal Revenue Code
requirements, Matching Contributions attributable to Pre-Tax Contributions in
excess of the Internal Revenue Code Section 402(g) dollar limitation under
Section 4.1 and Matching Contributions attributable to excess Pre-Tax
Contributions under Section 5.4 shall be forfeited and applied to reduce future
Matching Contributions. Such Matching Contributions shall be forfeited
regardless whether they are otherwise vested under the Plan.
(g) If the Actual Deferral Percentage of a Highly Compensated Employee is
determined by combining the contributions and Compensation of family members of
the Employee, then the Actual Deferral Percentage is reduced in accordance with
the leveling method referred to in Section 5.7(c) above and the excess
contributions for the family unit are allocated among the family members in
proportion to the contributions of each family member that have been combined.
This procedure may be modified as allowable under applicable Treasury
regulations.
5.8 CORRECTION OF ERROR. If an error is made in the adjustment of a
Participant's Accounts, the error shall be corrected by the Plan Administrator,
and any gain or loss resulting from the correction shall be credited to the
income or charged as an expense of the Trust Fund for the Plan Year in which the
correction is made. In no event shall allocations previously made to the
Accounts of other Participants be required to be adjusted on account of the
error.
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SECTION VI
VESTING AND DISTRIBUTION OF ACCOUNTS
6.1 VESTED INTEREST. As of the Effective Date of the restated Plan, each
Participant shall have a fully vested interest at all times in his Accounts.
6.2 DISTRIBUTION UPON TERMINATION OF EMPLOYMENT. Subject to Section 6.4(g),
a Participant shall become entitled to a distribution of his Account when he
retires or when he is otherwise no longer employed by the Employer and
Affiliated Companies. A Participant's Account shall be valued as of the
Valuation Date as of which the distribution is made. All the Participant's
outstanding loans described in Section 7.4 shall become due and payable upon the
Participant's termination of employment.
6.3 DEATH. If a Participant dies before his Account has been distributed,
his Account shall be paid to his Beneficiary. The Participant's Account shall be
valued as of the Valuation Date as of which the distribution is made. All the
Participant's outstanding loans described in Section 7.4 shall become due and
payable upon the Participant's death.
6.4 FORM AND TIME OF PAYMENT.
(a) If a Participant, other than a Canadian Employee, terminates employment
with the Employer and Affiliated Companies after his Retirement Date or on
account of his Permanent Disability, or if a Participant dies before his Account
has begun to be distributed, the Participant's Account will be distributed in
one of the following forms selected by the Participant (or his Beneficiary, in
the case of the Participant's death):
(i) The Account may be paid to the Participant (or Beneficiary) in
a lump sum payment.
(ii) The Account may be paid to the Participant (or Beneficiary) in
monthly installments over a term certain extending not beyond the
shorter of (x) 15 years or (y) the life expectancies of the Participant
and his Beneficiary. If the Participant dies before the completion of
installments, any balance of the Account shall be paid to his
Beneficiary as provided in Section 6.3. If a Beneficiary who is
receiving payments dies, any remaining balance of the Account shall be
paid to the personal representative of the Beneficiary's estate. When
establishing the term of installment payments to be paid to a
Participant and his Beneficiary, at the time payments begin, the present
value of the payments projected to be paid to the Participant, based on
his life expectancy, must be more than 50% of the present value of the
payments projected to be paid to the Participant and his Beneficiary,
based on their life expectancies.
(b) If a Participant's employment terminates for a reason other than one
described in subsection (a), the Participant's Account shall be distributed in a
lump sum payment. The Account balance of a Canadian Employee whose employment
terminates for any reason will be distributed in a lump sum payment.
(c) In order for benefits to begin to be paid to a Participant or
Beneficiary, the Participant or Beneficiary must submit a request for payment in
such form as the Plan Administrator shall designate. Payments under this Section
6.4 shall be made or shall begin to be made as soon as is administratively
feasible after the date on which the Participant or Beneficiary submits the
request for payment; provided that:
(i) If additional allocations are to be made to the Participant's
Account after the distribution date, then the additional allocations
will be distributed as soon as is administratively feasible after they
are made.
(ii) A Participant who is not a Canadian Employee and whose Account
balance has ever exceeded $3,500 may elect to postpone commencement of
his benefit to a Valuation Date not later than his 70th birthday. A
Participant who has elected to postpone commencement of his benefit may
later elect to begin receiving his benefit at an earlier Valuation Date
than the date originally designated.
(d) The following rules shall apply to a deceased Participant who was not a
Canadian Employee and whose Account balance exceeds or has exceeded $3,500:
(i) If a Participant dies after payments have begun, then his
remaining Account balance, if any, must be distributed to his
Beneficiary at least as rapidly as under the method of distribution
elected by the Participant.
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(ii) If a Participant dies before his Account balance has begun to
be distributed, then, except as provided below, his Account balance, if
any, must be distributed within five years after the Participant's
death. If the Participant's Account balance is distributed in
installment payments to (or for the benefit of) an individual
Beneficiary, then the Participant's Account balance may be distributed
over a period not extending beyond the Beneficiary's life expectancy,
and the payments must begin not later than one year after the
Participant's death (or such other date as may be prescribed by Treasury
regulations).
(e) Notwithstanding the foregoing, distributions from the Plan must begin
not later than the April 1 following the calendar year in which a Participant
reaches age 70 1/2. If a Participant is still in employ of the Employer when
distributions must begin, the Participant's Account will be distributed in a
lump sum payment or in at least annual installments over a period permitted by
Internal Revenue Code Section 401(a)(9). A Participant shall be required to
select a distribution form that complies with the requirements of Internal
Revenue Code Section 401(a)(9). Payments will begin as of the April 1 following
the calendar year in which the Participant reaches age 70 1/2. If the
Participant fails to elect the form in which his Account is to be distributed,
the Plan Administrator shall distribute the Participant's Account in a lump sum
and shall distribute any additional allocations as soon as is administratively
feasible after the close of the Plan Year in which the additional allocations
are made.
(f) A Participant may elect to have the portion of his Account that is
invested in the Company Stock Fund paid in whole shares of Company Stock, with
the value of fractional shares paid in cash, or entirely in cash. For purposes
of determining the amount of a cash distribution, Company Stock will be valued
as of the Valuation Date as of which the distribution is made. If part or all of
a Participant's Account is invested in any investment fund other than the
Company Stock Fund, that portion of the Account shall be paid in cash and shall
be valued as of the Valuation Date as of which the distribution is made.
(g) Notwithstanding the foregoing, a Participant's Prior Plan Pre-Tax
Contributions Account, Matched Pre-Tax Contributions Account, Unmatched Pre-Tax
Contributions Account, and Matching Contributions Account may not be distributed
unless:
(i) The Participant dies, incurs a Permanent Disability, attains
age 59 1/2, separates from the service of the Employer and Affiliated
Companies (as defined by applicable regulation), or qualifies for a
withdrawal under Section 7.1 or 7.2(d);
(ii) The Participant transfers employment to an employer that has
purchased substantially all of the assets used by the Participant's
former employer in its trade or business, and the distribution is made
within the time period required by applicable regulations;
(iii) The Participant is and continues to be employed by a
corporation that was formerly a subsidiary of the Employer or an
Affiliated Company and the stock of which has been sold, and the
distribution is made within the time period required by applicable
regulations; or
(iv) The Plan is terminated and no successor plan is established.
This Section 6.4(g) shall apply as required by Section 401(k) of the
Internal Revenue Code, notwithstanding anything in the Plan to the contrary, and
shall be administered consistent with the requirements of Section 401(k).
6.5 BENEFITS TO MINORS AND INCOMPETENTS.
(a) If any person entitled to receive payment under the Plan is a minor,
the Plan Administrator shall pay the amount in a lump sum directly to the minor,
to a guardian of the minor or to a custodian selected by the Trustee under the
appropriate Uniform Transfers to Minors Act.
(b) If a person who is entitled to receive payment under the Plan is
physically or mentally incapable of personally receiving and giving a valid
receipt for any payment due (unless a previous claim has been made by a duly
qualified committee or other legal representative), the payment may be made to
the person's spouse, son, daughter, parent, brother, sister or other person
deemed by the Plan Administrator to have incurred expense for the person
otherwise entitled to payment.
6.6 LOCATION OF MISSING PARTICIPANTS.
(a) If a Participant cannot be located after reasonable efforts have been
made by the Plan Administrator to locate him (or, in the case of a Participant's
death, his Beneficiary), then the Participant's Account shall be forfeited. If a
Participant's
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Account exceeds $500, reasonable efforts to achieve payment shall be deemed to
have been made if the Plan Administrator is unable to locate the Participant (or
Beneficiary) after two successive certified or similar mailings to the last
address on file with the Plan Administrator; provided, however, that in no event
shall such reasonable efforts be deemed to have been completed earlier than the
close of the 12 consecutive calendar month period following the last of the two
successive mailings. If a Participant's Account does not exceed $500, reasonable
efforts to achieve payment shall be deemed to have been made if the Plan
Administrator is unable to locate the Participant (or Beneficiary) after one
certified or similar mailing to the last address on file with the Plan
Administrator and the Participant (or Beneficiary) does not respond to the
mailing within three months following the date of the mailing.
(b) As of the Valuation Date next following the end of the 12-month period
or three-month period (whichever is applicable), the missing Participant's
Account shall be forfeited. If the Participant or Beneficiary makes a valid
written claim for the Account after it has been forfeited, the Participant's
former Employer shall make a contribution to the Plan to reinstate the forfeited
amount to the Participant's Account. The Employer's contribution may be made in
one or more payments over such period of time as the Employer deems appropriate.
6.7 NO GUARANTEE OF VALUES. The Employer does not guarantee that the market
value of the Company Stock when it is distributed will be equal to its purchase
price or that the total amount distributable or withdrawable under the Plan will
be equal to or greater than the amount of the Participant's contributions and
loans. Each Participant assumes all risk of any decrease in the market value of
the Company Stock and other assets allocated to his Account in accordance with
the provisions of the Plan.
6.8 ELIGIBLE ROLLOVER DISTRIBUTIONS.
(a) Notwithstanding any provision of the Plan to the contrary, a
distributee may elect, at the time and in the manner prescribed by the Plan
Administrator, 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.
(i) ELIGIBLE ROLLOVER DISTRIBUTION: An eligible rollover
distribution is any distribution of all or any portion of the balance to
the credit of the distributee, except that an eligible rollover
distribution does not include: any distribution that is one of a series
of substantially equal periodic payments (not less frequently than
annually) made for the life (or life expectancy) of the distributee or
the joint lives (or joint life expectancies) of the distributee and the
distributee's designated beneficiary, or for a specified period of ten
years or more; any distribution to the extent such distribution is
required under Section 401(a)(9) of the Internal Revenue Code; and the
portion of any distribution that is not includable in gross income
(determined without regard to the exclusion for net unrealized
appreciation with respect to employer securities).
(ii) ELIGIBLE RETIREMENT PLAN: An eligible retirement plan is an
individual retirement account described in Section 408(a) of the
Internal Revenue Code, an individual retirement annuity described in
Section 408(b) of the Internal Revenue Code, an annuity plan described
in Section 403(a) of the Internal Revenue Code, or a qualified trust
described in Section 401(a) of the Internal Revenue Code, that accepts
the distributee's eligible rollover distribution. However, in the case
of an eligible rollover distribution to the surviving spouse, an
eligible retirement plan is an individual retirement account or
individual retirement annuity.
(iii) DISTRIBUTEE: A distributee includes an employee or former
employee. In addition, the employee's or former employee's surviving
spouse and the employee's or former employee's spouse or former spouse
who is the alternate payee under a qualified domestic relations order,
as defined in Section 414(p) of the Internal Revenue Code, are
distributees with regard to the interest of the spouse or former spouse.
(iv) DIRECT ROLLOVER: A direct rollover is a payment by the Plan to
the eligible retirement plan specified by the distributee.
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SECTION VII
WITHDRAWALS AND LOANS
7.1 HARDSHIP WITHDRAWALS.
(a) A Participant who is not a Canadian Employee may request that the Plan
Administrator authorize a hardship withdrawal to be made from his Pre-Tax
Contributions Accounts (described in Sections 5.1(a), (b), (d), and (g)) and
Matching Contributions Account, if the Participant has incurred financial
hardship, as described below.
(b) A Participant will be considered to have incurred financial hardship if
he has immediate and heavy financial needs that cannot be fulfilled through
other reasonably available financial resources of the Participant. Immediate and
heavy financial needs shall mean needs resulting from:
(i) Expenses for medical care described in Section 213(d) of the
Internal Revenue Code previously incurred by the Participant, the
Participant's spouse, or any dependents of the Participant (as defined
in Section 152 of the Internal Revenue Code) or necessary for these
persons to obtain medical care described in Section 213(d) of the
Internal Revenue Code;
(ii) Costs directly related to the purchase of a principal
residence for the Participant (excluding mortgage payments);
(iii) Payment of tuition and related educational fees for the next
12 months of post-secondary education for the Participant or his spouse,
children or dependents (as defined in Section 152 of the Internal
Revenue Code);
(iv) Payments necessary to prevent the eviction of the Participant
from his principal residence or foreclosure on the mortgage of the
Participant's principal residence; or
(v) Any additional expenses or payments approved by the Internal
Revenue Service.
The determination of hardship shall be made by the Plan Administrator in a
uniform and nondiscriminatory manner in accordance with such standards as may be
promulgated from time to time by the Internal Revenue Service.
(c) A distribution will be deemed necessary to satisfy an immediate and
heavy financial need of the Participant if all of the following requirements are
met:
(i) The distribution is not in excess of the amount of the
Participant's immediate and heavy financial need;
(ii) The Participant has obtained all distributions,other than
hardship withdrawals, and all non-taxable loans currently available
under all plans maintained by the Employer;
(iii) The Participant may not make contributions to the Plan or any
other plan of deferred compensation maintained by the Employer (except
for any defined benefit plan maintained by the Employer that requires
mandatory employee contributions) for 12 months after receipt of the
withdrawal; and
(iv) The Participant may not make Pre-Tax Contributions for the
calendar year that immediately follows the year of the withdrawal in
excess of the applicable limit under Section 4.1(b) for the year, minus
the amount of the Participant's Pre-Tax Contributions for the year in
which the withdrawal is made.
(d) Hardship withdrawals may be made as of the end of any month. A
Participant who wishes to make a hardship withdrawal shall apply in writing to
the Plan Administrator, in such form and at such time as the Plan Administrator
shall designate. The Participant must furnish such information in support of his
application as may be requested by the Plan Administrator. Notwithstanding the
foregoing, if required by Rule 16b-3, a Participant who is an Insider may only
request a withdrawal as of the end of a Plan Period.
(e) The Plan Administrator shall determine the amount, if any, of
withdrawal that may be made and may direct distribution of as much of the
eligible portion of the Participant's Account as the Plan Administrator deems
necessary to alleviate the hardship. The Plan Administrator may not authorize a
hardship withdrawal in excess of the amount deemed necessary to alleviate the
hardship or in excess of the eligible portion of the Participant's Account as of
the date as of which the Plan Administrator approves the withdrawal. The amount
withdrawn from a Participant's Account shall not exceed the amount by which the
balance of the Participant's Account exceeds the unpaid balance of any
outstanding loans described in Section 7.4.
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(f) Notwithstanding the foregoing, a Participant may not withdraw from his
Pre-Tax Contributions Accounts any earnings credited to those Accounts on or
after January 1, 1989. If Matching Contributions for years beginning on or after
January 1, 1989 are included in computing the Actual Deferral Percentage under
Section 5.4(c), a Participant may not make a hardship withdrawal from those
Matching Contributions or earnings thereon.
(g) A hardship withdrawal shall be paid in a lump sum payment as soon as is
administratively feasible after the Valuation Date coinciding with or next
following the date on which the hardship withdrawal is approved, in the same
manner as distributions are made pursuant to Section 6.4(e).
7.2 WITHDRAWALS DURING EMPLOYMENT.
(a) Subject to subsections (b) and (c) below, a Participant who is not a
Canadian Employee may request a withdrawal of all or a specified part of his
After-Tax Contributions Accounts (described in Section 5.1(e) and (h)), Prior
Plan Matching Contributions Account, and Employer Contributions Rollover Account
as of any Valuation Date. However, if required by Rule 16b-3, a Participant who
is an Insider may only request a withdrawal as of the end of a Plan Period. A
withdrawal may not exceed the Participant's interest in the foregoing Accounts
as of the Valuation Date as of which the withdrawal is made and may not exceed
the limits described in subsections (b) and (c) below.
(b) A Participant may not withdraw the following amounts from his Accounts:
(i) Matching contributions made with respect to after-tax
contributions under the Prior Plan, until the Matching Contributions
have been held in the Plan (including the Prior Plan) for at least 24
calendar months.
(ii) After-tax contributions that were matched by matching
contributions under the Prior Plan, until the contributions have been
held in the Plan (including the Prior Plan) for at least six calendar
months.
(c) In order to make a withdrawal pursuant to subsection (a), a Participant
must submit an application in such form and at such time as the Plan
Administrator shall designate. A Participant requesting a withdrawal shall
specify in his request which of the following types of withdrawals shall be
made:
(i) A withdrawal of the maximum amount available to be distributed
from the Participant's Accounts described in subsection (a).
(ii) A withdrawal of a specified number of shares of Company Stock
from the Participant's Accounts.
(iii) A withdrawal of a specified dollar amount.
The Participant's Accounts shall be valued as of the Valuation Date as of
which the Plan Administrator approves the withdrawal. The amount withdrawn from
a Participant's Accounts shall not exceed the amount by which the Participant's
total Account, reduced by the unpaid balance of any outstanding loans described
in Section 7.4, exceeds the unpaid balance of any outstanding loans described in
Section 7.4.
(d) A Participant who is not a Canadian Employee and who has attained age
59 1/2 may request a one-time withdrawal of the entire balance in his Accounts
as of any Valuation Date. However, if required by Rule 16b-3, a Participant who
is an Insider may only request a withdrawal as of the end of a Plan Period.
After a Participant who has attained age 59 1/2 has made a one-time withdrawal
of his entire balance in his Accounts, any future withdrawals shall be subject
to the limitations imposed under Sections 7.2(b) and (c). If a one-time
withdrawal is made pursuant to this subsection (d), the Participant's
outstanding loans described in Section 7.4 shall become due and payable. Any
loan described in Section 7.4 that is not promptly repaid shall be considered in
default and treated as a taxable distribution to the Participant. To make a
one-time withdrawal pursuant to this subsection (d), a Participant must submit
an application in such form and at such time as the Plan Administrator shall
designate.
(e) A withdrawal shall be paid in a lump sum payment, in the same manner as
distributions are made pursuant to Section 6.4(f).
7.3 WITHDRAWALS DURING EMPLOYMENT BY CANADIAN EMPLOYEES.
(a) Participants who are Canadian Employees may not make withdrawals
pursuant to Section 7.1 or 7.2. Instead, as of any Valuation Date, a Participant
who is a Canadian Employee may withdraw all or any portion of his Prior Plan
After-Tax Contributions Account that does not exceed:
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(i) That portion of the Account that has a market value, as of the
Valuation Date as of which the withdrawal is made, equal to the
aggregate after-tax contributions made by the Participant to the Prior
Plan before the Valuation Date, less
(ii) The amount of any previous withdrawals made by the Participant
from the Account pursuant to subsection (a).
(b) The Plan Administrator may authorize a Canadian Employee to make a
withdrawal from his Prior Plan Matching Contributions Account as of a Valuation
Date if there is an adverse condition in the Participant's affairs that, in the
opinion of the Plan Administrator, has resulted in an immediate need for
financial assistance to meet obligations incurred or to be incurred by the
Participant to pay (i) substantial medical or other expenses to maintain the
participant's health or the health of members of his immediate family, (ii)
substantial expenses to provide for the higher education of the Participant's
children, (iii) substantial expenses to maintain the Participant's welfare and
the welfare of his immediate family in the event of his permanent lay-off,
divorce, separation from his spouse or other form of domestic breakdown, or (iv)
substantial expenses arising as a result of other family emergency, including,
under extraordinary circumstances, expenses needed to purchase a primary
residence. A Participant may not make a withdrawal pursuant to this subsection
(b) unless all amounts that may be withdrawn pursuant to subsection (a) have
been withdrawn.
(c) A withdrawal pursuant to this Section 7.3 shall be made by submitting
an application in such form and at such time as the Plan Administrator shall
designate. If required by Rule 16b-3, a Participant who is an Insider may only
request a withdrawal as of the end of a Plan Period. Withdrawals shall be paid
in a lump sum payment, in the same manner as distributions are made pursuant to
Section 6.4(f).
7.4 LOANS. As of any Valuation Date, a Participant who is an Employee,
other than a Canadian Employee, may apply to the Plan Administrator, for a loan
to be made to the Participant from his Account. Loan requests shall be made in
such form and at such times as the Plan Administrator shall designate. Loans
shall be made available to Participants who are not Employees if and to the
extent required by law, and, notwithstanding anything in the Plan to the
contrary, the Plan Administrator shall make appropriate arrangements for such
loans, if required by applicable law. A loan may be made to a Participant
subject to the following conditions:
(a) A loan may not be made to the Participant unless the Plan Administrator
approves the loan, acting according to uniform and nondiscriminatory standards.
The Plan Administrator shall take into consideration the terms of any existing
Qualified Domestic Relations Order in determining whether to approve a loan.
(b) The loan may only be made from a Participant's vested interest in his
Account as of the Valuation Date as of which the loan is to be made. The minimum
loan that may be made to a Participant is $1,000 (or such other amount as may be
permitted by law) and the maximum loan is one-half of the Participant's Account.
The amount of loans outstanding to a Participant at any time, aggregated with
the outstanding balance of all other loans to the Participant from all other
qualified plans maintained by the Employer and Affiliated Companies, shall not
exceed the lesser of:
(i) $50,000 (adjusted as described below); or
(ii) The greater of (x) one-half of the Participant's Account under
the Plan or (y) $10,000.
The $50,000 amount referred to in subparagraph (i) above shall be reduced
by the difference between (x) the highest outstanding balance of loans to the
Participant from the Plan during the one-year period ending on the day before
the date of the loan and (y) the outstanding balance of loans to the Participant
from the Plan on the date of the loan. For purposes of applying the foregoing
limitations, the value of a Participant's Account shall be determined as of the
Valuation Date as of which the loan is to be made. Overdue interest shall be
deemed to be an outstanding loan.
(c) Loans shall be available to all Participants on a reasonably equivalent
basis. Loans shall not be made available to highly compensated Participants in a
greater percentage of their vested Account balances than the percentage that is
available to other Participants.
(d) Not more than one-half (or such other amount as may be permitted by
applicable law) of a Participant's Account, determined immediately after the
origination of the loan, may be used as security for the outstanding balance of
all Plan loans made to a Participant.
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(e) Loans shall be made in cash. When a loan is made to a Participant,
shares of Company Stock and other assets held in his Account will be liquidated
to provide the funds to be loaned to the Participant. The loan shall be
evidenced by a promissory note, which shall be held as an asset of the
Participant's Account.
(f) Interest on a loan shall be charged at the prime rate of the Plan
Trustee (or such other bank as the Plan Administrator deems appropriate) in
effect as of the first day of the month in which the loan application is
received by the Plan Administrator, as determined by the Plan Administrator.
However, if the Plan Administrator determines that ERISA requires that interest
be charged at a rate other than the Plan Trustee's prime rate, the Plan
Administrator shall charge interest at the rate required by law. When
establishing interest rates on Plan loans, the Plan Administrator may charge
different rates based on the loan repayment method that will apply to the
Participant. If a new loan is to be made while a previous loan is outstanding,
the two loans shall be consolidated at the interest rate in effect at the time.
Not more than two loans may be consolidated at any point in time.
(g) A loan shall be repayable within five years from the date on which the
loan is made; provided that a loan made for the purposes of enabling a
Participant to purchase his primary residence may have a term of up to ten
years. Loans to Employees shall be repaid by payroll deduction, with equal
payments (including principal and interest) due each payday. Loans to
Participants who are not active Employees shall be repaid according to
appropriate arrangements made by the Plan Administrator. A Participant may elect
to prepay the balance of his outstanding loan at any time by any method
acceptable to the Plan Administrator. If a Participant elects to prepay his
outstanding loan, the prepayment must be for the entire balance of the loan
amount, unless applicable law provides otherwise.
(h) A loan made to a Participant shall be considered a separate investment
of the portion of the Participant's Account that is equal to the outstanding
balance of the loan. The balance in the borrowing Participant's Account shall be
reduced by the outstanding balance of the loan for purposes of allocating net
income and increases and decreases in the value of the Trust Fund assets.
Interest and principal paid on the loan shall be credited to the borrowing
Participant's Account and shall be invested as described in Section 9.7.
Principal and interest paid on the loan shall not be considered earnings of the
Trust Fund for allocation purposes.
(i) If an outstanding loan is not repaid as and when due, the principal of
and interest on the loan shall be deducted from any benefit that the Participant
or his Beneficiary is entitled to receive, and the Participant or Beneficiary
shall be subject to tax in accordance with Internal Revenue Code requirements.
The unpaid principal and interest shall be deducted from the Account on the
first date on which a Participant's Account may be distributed. If a loan
becomes due and payable upon a Participant's termination of employment and the
Participant (or Beneficiary, in the event of his death) does not repay the loan
within 90 days after the Participant's termination of employment, the portion of
the Participant's Account attributable to the unpaid loan will be deemed to be
distributed to the Participant (or Beneficiary) as of the end of the 90-day
period, and the Participant's Account balance will be automatically offset by
the unpaid loan balance.
(j) If any amount is distributed from the Trust Fund to a Participant or
his Beneficiary while a loan to the Participant is outstanding, the Plan
Administrator shall direct that the distributed amount be applied to reduce the
outstanding balance of the loan.
(k) Expenses incurred by the Plan Administrator and the Trustee in making,
administering and collecting a loan may be charged against the Account of the
borrowing Participant.
(l) The Plan Administrator may adopt and utilize such forms and other
documents as may be necessary or appropriate to administer the Plan's loan
provisions, and such forms and documents are incorporated herein by this
reference.
(m) A Participant may not request more than two loans during a Plan Year.
The following rules apply to multiple loan requests:
(i) For a Participant who does not have a loan outstanding as of
July 1, 1993, and for any loan not subject to the special provisions of
subsection (ii) below, the Participant must repay any outstanding loan
from the Plan before receiving a second loan from the Plan.
(ii) If a Participant has a loan outstanding as of July 1, 1993,
the Participant may apply for a second loan to be made from the Plan.
The second loan will be consolidated with the loan outstanding as of
July 1, 1993, subject to the requirements of this Section 7.4. Only one
consolidation may be made with a loan outstanding as of July 1, 1993. If
a Participant's loan that is outstanding as of July 1, 1993 has a term
of more than five years, the Participant
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may not receive another loan until the term remaining on his outstanding
loan is less than five years. A request to receive a loan to be
consolidated with a loan outstanding as of July 1, 1993 must be filed
with the Plan Administrator at least 15 days before the Valuation Date
as of which the loan is to be made.
7.5 OUTSTANDING PRIOR PLAN LOANS. Any outstanding loan made before June 30,
1984, as described in Section 4.8 of the Prior Plan, must be repaid within 90
days after the Effective Date.
7.6 INSIDERS. Notwithstanding anything in the Plan to the contrary, the
Plan Administrator may impose on Insiders such restrictions and requirements
regarding participation, contributions, investments, distributions and other
matters as the Plan Administrator deems appropriate to comply with Rule 16b-3.
SECTION VIII
TRUST ARRANGEMENTS
8.1 APPOINTMENT OF TRUSTEE. The Trustee shall be named in the Trust
Agreement. Upon execution of the Trust Agreement, the Trustee shall have
exclusive responsibility, authority and discretion to hold and invest the assets
of the Plan, as provided in the Trust Agreement and in the Plan.
SECTION IX
INVESTMENT OF ACCOUNTS
9.1 INVESTMENT FUNDS. The following investment funds shall be established
for purposes of the Plan:
(a) COMPANY STOCK FUND. The Company Stock Fund shall be invested primarily
in Company Stock. The Trustee may purchase and sell Company Stock on the open
market, from and to the Company, and in any other manner as the Trustee deems
appropriate, consistent with applicable securities laws, ERISA and the Internal
Revenue Code.
(b) OTHER INVESTMENT FUNDS. The Plan Administrator shall designate other
investment funds from time to time for investment of Participant Accounts. The
Plan Administrator shall select the investment funds in accordance with ERISA
section 404(c) and the regulations thereunder.
Plan assets may be invested in a short term investment fund or in any other
manner deemed appropriate by the Trustee, pending investment in the appropriate
investment fund.
9.2 INVESTMENT OF ACCOUNTS BY PARTICIPANTS UNDER AGE 57.
(a) Each Participant who has not yet attained age 57 may elect either (i)
to have his Pre-Tax Contributions invested in the Company Stock Fund and receive
Matching Contributions with respect to the Pre-Tax Contributions or (ii) to have
his Pre-Tax Contributions invested in one or more of the alternate investment
funds and not receive Matching Contributions with respect to the Pre-Tax
Contributions.
(b) Each Participant who has not yet attained age 57 shall have the right
to direct the investment of his (i) Unmatched Pre-Tax Contributions Account,
(ii) Prior Plan After-Tax Contributions Account, (iii) Pre-Tax Contributions
Rollover Account, (iv) After-Tax Contributions Rollover Account, and (v)
Employer Contributions Rollover Account into any one or more of the investment
funds offered pursuant to Section 9.1.
(c) Each Participant who has not yet attained age 57 may direct the
investment of his Prior Plan Matching Contributions Account as follows:
(i) Amounts attributable to matching contributions made with
respect to after-tax contributions under the Prior Plan within the
preceding 24 calendar months shall be invested in the Company Stock
Fund.
(ii) All other amounts in the Participant's Prior Plan Matching
Contributions Account may be directed into any of the investment funds
offered pursuant to Section 9.1.
(d) Pre-Tax Contributions that are matched with Matching Contributions
pursuant to Section 4.2 automatically shall be invested in the Company Stock
Fund. Such matched Pre-Tax Contributions, and earnings thereon, shall remain
invested in the Company Stock Fund, and may not be transferred to another
investment fund, until the earlier of (i) the date on which the
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matched Pre-Tax Contributions have been held in the Plan for at least 24
consecutive calendar months, or (ii) the date on which the Participant attains
age 57.
(e) Matching Contributions automatically shall be invested in the Company
Stock Fund, except as provided in Section 9.3. Matching Contributions, and
earnings thereon, shall remain invested in the Company Stock Fund and may not be
transferred to another investment fund until the Participant attains age 57.
9.3 INVESTMENT OF ACCOUNTS BY PARTICIPANTS AGE 57 OR OLDER. Each
Participant who is age 57 or older shall have the right to direct the investment
of all of his Accounts into any of the investment funds offered pursuant to
Section 9.1.
9.4 DIRECTED INVESTMENTS. With respect to those portions of a Participant's
Account that are not restricted to automatic investment in the Company Stock
Fund, investments may be directed by the Participant in accordance with
regulations issued under the Internal Revenue Code and ERISA, as follows:
(a) Each Participant may submit an investment direction in such form and at
such time as the Plan Administrator shall designate. Investment directions may
be made at least quarterly. The investment direction shall specify the
investment funds in which the Participant's Accounts are to be invested.
Investment directions shall be submitted to such person as the Plan
Administrator designates to implement the Participants' directions. An
investment direction shall continue to apply until a subsequent direction is
properly submitted. The Trustee may charge Participants' Accounts for the
reasonable expenses of carrying out investment instructions.
(b) Each Participant shall be provided the following information for each
investment fund:
(i) An explanation that the Plan is intended to constitute a plan
described in Section 404(c) of ERISA and the corresponding regulations, and
that the fiduciaries of the Plan may be relieved of liability for any
losses which are the direct and necessary result of investment instructions
given by such Participant;
(ii) A description of the investment fund and its investment
objectives and risk and return characteristics, including the type and
diversification of assets in the investment;
(iii) An identification of any designated investment managers;
(iv) An explanation of the circumstances under which the Participant
may give instructions and limitations thereon;
(v) A description of any fees and expenses which may be charged to the
Participant's Account in connection with purchases or sales of interests in
the investment fund;
(vi) The name, address and telephone number of the Plan fiduciary (or
his designee) responsible for providing the information required under this
Section 9.4;
(vii) Any materials relating to the exercise of voting or similar
rights incidental to the Participant's ownership interest in the investment
fund, to the extent that such rights are passed through to Participants
under the terms of the Plan;
(viii) If the investment fund is subject to the Securities Act of
1933, a copy of the most recent prospectus immediately prior to the
Participant's initial investment in the investment fund; and
(ix) With respect to the Company Stock Fund, Participants shall be
provided with all information generally required to be provided to
shareholders of the Company.
(c) Upon request, each Participant shall also be provided the following
information for each investment fund:
(i) A description of the annual operating expenses and the total expenses,
expressed as a percentage of average net assets;
(ii) Copies of any prospectuses, financial statements and reports, and
any other materials that are available to the Plan;
(iii) A list of the assets comprising the portfolio, together with the
value of each asset and, if the asset is a fixed rate contract issued by a
bank, savings and loan association, or insurance company, the name of the
issuer, the term, and the rate of return on the contract;
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(iv) Information concerning the value of shares or units in investment
funds available to Participants under the Plan, as well as the past and
current investment performance of such funds (determined, net of expenses,
on a reasonable and consistent basis); and
(v) Information concerning the value of shares or units held in the
Account of the Participant.
9.5 LIMITATIONS ON DIRECTED INVESTMENTS. The Trustee may decline to
implement a Participant's investment directions if such directions would:
(a) Result in a prohibited transaction as described in ERISA Section 406 or
Internal Revenue Code section 4975;
(b) Generate taxable income to the Plan or jeopardize its tax qualified
status;
(c) Not be in accordance with the documents and instruments governing the
Plan;
(d) Cause a fiduciary to maintain the indicia of ownership in an asset
outside jurisdiction of the United States district courts;
(e) Result in a loss greater than the balance in the Participant's Account;
or
(f) Result in certain transactions between the Plan and the Employer or an
affiliate of the Employer.
9.6 APPLICATION TO BENEFICIARIES AND ALTERNATE PAYEES. All Beneficiaries of
deceased Participants who have Account balances in the Plan may direct the
investment of their Accounts into any one or more of the investment funds
offered pursuant to Section 9.1. After an Alternate Payee's interest in a
Participant's Accounts has been finally determined pursuant to Section 11.8, the
Alternate Payee may direct the investment of the Alternate Payee's Accounts into
one or more of the investment funds offered pursuant to Section 9.1, to the same
extent that the Participant could have directed the investment of the Accounts.
9.7 ORDER OF WITHDRAWALS AND LOANS FROM THE INVESTMENT FUNDS. When a
withdrawal or loan is made from a Participant's Account that is invested in more
than one investment fund, the amount to be withdrawn or loaned shall be deducted
proportionately from the amount invested in each investment fund. In the case of
a loan, the amount to be deducted from each investment fund shall be determined
as of the Valuation Date as of which the loan is to be made, after amounts to be
allocated as of the Valuation Date have been allocated but before any transfers
between the investment funds or withdrawals have been made. Loan repayments
shall be credited pro rata to the investment funds from which the loan was made,
unless the Participant designates another investment, consistent with the
requirements of Section 9.2, if applicable. In the case of a withdrawal, the
amount to be deducted from each investment fund shall be determined as of the
Valuation Date as of which the withdrawal is to be made, after amounts to be
allocated as of that Valuation Date have been allocated and after any loans or
any transfers between investment funds have been made. The Plan Administrator
shall have discretion to change, in a non-discriminatory manner, the foregoing
order in which withdrawals and loans from the investment funds are to be made
and credited.
9.8 BASIS OF COMPANY STOCK. The basis of Company Stock held in the Trust
Fund shall be determined as follows:
(a) The basis of Company Stock purchased by the Trustee shall be the actual
cost of the Company Stock to the Trustee. The basis of all other Company Stock
acquired by the Trustee (including Company Stock contributed by the Employer to
the Trust Fund) shall be the fair market value of the Company Stock on the date
of acquisition.
(b) The basis of shares of Company Stock that are forfeited shall be
adjusted to equal the fair market value of the Company Stock as of the date as
of which the forfeitures occur.
(c) As of each Valuation Date, the basis of all Company Stock that is made
available for allocation to the Accounts of the Participants shall be calculated
by averaging the basis of all Company Stock to be allocated as of that date, as
determined pursuant to subsections (a) and (b). The basis of Company Stock
allocated to a Participant's Account as of a Valuation Date will be averaged
with the basis of the other shares of Company Stock held in the Account.
(d) When a distribution is made from a Participant's Account, the average
cost basis of all the Company Stock held in the Account will be the Trustee's
basis with respect to the shares of Company Stock distributed.
9.9 LIMITATION ON INSIDERS' INTERESTS IN COMPANY STOCK. The Plan
Administrator may determine that the fair market value of Company Stock held in
the Accounts of Participants who are Insiders may not equal or exceed 20% of the
fair market
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value of all securities with a readily ascertainable fair market value that are
then held in the Trust Fund. If the limitation of this Section is or may be
exceeded, the Plan Administrator may direct Insiders to invest all or part of
their Accounts in investments other than the Company Stock Fund, consistent with
applicable Internal Revenue Code and ERISA requirements.
9.10 VOTING, TENDER AND EXERCISE OF SIMILAR RIGHTS WITH RESPECT TO COMPANY
STOCK.
(a) A Participant may instruct the Trustee how to vote, tender, or exercise
similar rights with respect to the shares of Company Stock that are allocated to
the Participant's Account. The Trustee shall hold any voting, tender, or similar
instructions it receives from a Participant in the strictest confidence and
shall implement and follow procedures sufficient to safeguard the
confidentiality of such instructions, except to the extent necessary to comply
with Federal or state laws not preempted by ERISA.
(b) With respect to shares for which no investment instructions are
received from Participants, the Trustee shall vote, tender, or exercise any
similar rights relating to such shares in the manner in which the Trustee deems
appropriate.
(c) The Plan Administrator shall ensure that all notices, forms, and other
information regarding the exercise of voting, tender, or similar rights are
distributed to Participants within a reasonable time before voting, tender, or
similar rights are to be exercised. Instructions from a Participant must be
received by the Trustee in time for the Trustee to act with respect to them.
9.11 TRUSTEE'S RESPONSIBILITIES WITH RESPECT TO MANAGEMENT OF THE COMPANY
STOCK FUND.
(a) In addition to the duties described in Section 9.10, the Trustee shall
implement and follow procedures sufficient to safeguard the confidentiality of
information relating to the purchase, holding, and sale of Company Stock in the
Company Stock Fund, except to the extent necessary to comply with Federal or
state laws not preempted by ERISA.
(b) The Trustee shall require the Plan Administrator to appoint an
independent fiduciary (within the meaning of Department of Labor regulation
section 2550.404(c)-1) to perform certain functions with respect to the Company
Stock Fund if the Trustee determines that such an appointment of an independent
fiduciary is necessary because of a potential for undue Employer influence upon
Participants with regard to the direct or indirect exercise of their shareholder
rights.
9.12 ALLOCATION OF INCOME IN COMPANY STOCK FUND.
(a) All net income that is earned by the Company Stock Fund on investments
other than Company Stock shall be invested by the Trustee in shares of Company
Stock (except to the extent that the Trust Agreement provides otherwise). Shares
of Company Stock attributable to such net income shall be allocated among the
Accounts invested in the Company Stock Fund as of each Valuation Date in the
proportion that the value of each such Account as of the preceding Valuation
Date bears to the value of all such Accounts on the preceding Valuation Date. As
described in Section 7.4(h), the outstanding balance of a Participant's loans
described in Section 7.4 will not be included as part of his Account balance for
purposes of allocations under this Section 9.12.
(b) Cash dividends paid on Company Stock held in the Company Stock Fund
shall be reinvested in shares of Company Stock and shall be allocated among the
Accounts invested in the Company Stock Fund on the basis of the number of shares
held in each Account as of the previous Valuation Date.
(c) All Company Stock or other assets received as a result of a stock split
or stock dividend, a reorganization or other recapitalization of the Company,
spin-off of a subsidiary, or any other transaction shall be allocated among the
Accounts invested in the Company Stock Fund on the basis of the number of shares
held in each Account as of the previous Valuation Date.
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9.13 ALLOCATION OF INCOME IN INVESTMENT FUNDS OTHER THAN THE COMPANY STOCK
FUND. All net income that is earned on investments in investment funds described
in Section 9.1(b) shall be reinvested by the Trustee in the investment funds. As
of each Valuation Date, the Trustee shall determine the current fair market
value of each such investment fund. As of each Valuation Date, before making
adjustments for withdrawals, loans and transfers, the Plan Administrator shall
adjust the Accounts to reflect the value of the investment fund as of such date;
such adjustment shall be based on each Participant's Account balance invested in
the investment fund as of the preceding Valuation Date. As described in Section
7.4(h), the outstanding balance of a Participant's loans described in Section
7.4 will not be included as part of his Account balance for purposes of
allocations under this Section 9.13.
SECTION X
GENERAL PROVISIONS
10.1 NONALIENATION OF BENEFITS. No person shall have any interest in or
right to any assets of the Trust Fund or any rights under the Plan except to the
extent expressly provided in the Plan. Benefits payable under the Plan shall not
be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution, or levy of any
kind, either voluntary or involuntary, including any liability for alimony or
other payments for the support of a spouse, former spouse, or for any other
relative of a Participant or Beneficiary, before actually being received by the
person entitled thereto under the terms of the Plan. Any attempt to anticipate,
alienate, sell, transfer, assign, pledge, encumber, charge or otherwise dispose
of any right to benefits payable under the Plan shall be void. The Trust Fund
shall not in any manner be liable for, or subject to, the debts, contracts,
liabilities, or torts of any person entitled to benefits hereunder.
10.2 MERGER OR CONSOLIDATION. In the case of any merger or consolidation of
the Plan with, or transfer of assets or liabilities to, any other plan, each
Participant and Beneficiary of the Plan shall have an accrued benefit
immediately after the merger, consolidation or transfer that is equal to or
greater than the accrued benefit that the Participant or Beneficiary had
immediately before the merger, consolidation or transfer.
10.3 NO CONTRACT OF EMPLOYMENT. Nothing contained in the Plan shall be
construed as a contract of employment between the Company and any person, or as
giving a right to any person to continue in the employment of an Employer, or as
limiting the right of an Employer to discharge any person at any time, with or
without cause.
10.4 NON-REVERSION. It shall be impossible, at any time before satisfaction
of all liabilities with respect to Participants and their Beneficiaries, for any
part of the principal or income of the Trust Fund to be used for, or diverted
to, purposes other than for the exclusive benefit of such Participants and their
Beneficiaries. However, the Employer's contributions under the Plan for any
particular Plan Year shall be conditioned upon (i) the Plan initially being a
qualified plan under Section 401(a) of the Internal Revenue Code for the Plan
Year, and (ii) the contribution being deductible under Section 404 of the
Internal Revenue Code. If, after the Employer's contribution has been made, it
is determined that a condition described in (i) or (ii) was not satisfied with
respect to such contribution, or that all or a portion of such contribution was
made under a mistake of fact, then the Trustee shall refund to the Employer
within one year of the date the contribution is remitted to the Trustee, if such
contribution is made by reason of a mistake of fact, or within one year of the
denial of qualification or disallowance of the deduction, the amount of the
contribution that was affected by the mistake of fact, or by a condition
described in (i) or (ii) not being satisfied, subject to the following rules:
(a) The Trustee shall be under no obligation to make such refund unless a
written direction of the refund signed by an authorized representative of the
Employer, is submitted to the Trustee.
(b) Earnings attributable to the refundable amount shall not be refunded,
but the refundable amount shall be reduced by a proportionate share of any
losses of the Trust from the date of crediting by the Trustee to the date of
segregation.
(c) The Trustee shall be under no obligation to verify that the refund is
allowable or timely and shall be entitled to rely on the Employer's written
direction.
10.5 CONSTRUCTION AND SEVERABILITY. Except as otherwise provided by Federal
law, the Plan shall be administered, construed and enforced according to
Virginia law. Each provision of the Plan shall be considered to be severable
from all other provisions, so that if any provision or any part of a provision
shall be declared void, the remaining provisions shall continue to be effective.
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10.6 DELEGATION OF AUTHORITY. Whenever any Employer is permitted or
required to perform any act, such act may be performed by any officer or other
person duly authorized by the Board.
10.7 CHANGES IN CAPITAL STRUCTURE. The existence of the Plan shall not
limit or in any way affect the right of any Employer to change its capital
structure or accounting practices at any time in whatever manner it may
determine to be advisable.
10.8 RECEIPT OF ROLLOVERS AND TRUSTEE-TO-TRUSTEE TRANSFERS.
(a) The Trustee may receive a transfer of assets previously held under
another tax-qualified plan for the benefit of a person who is eligible to
participate in this Plan, provided that the assets are not subject to the
annuity requirements of Section 417 of the Internal Revenue Code. The assets may
be received directly from the trustee of a tax-qualified plan, or they may be
received as a rollover contribution from a tax-qualified plan or from an
individual retirement account. Any plan from which assets are received must be a
plan qualified under Section 401 of the Internal Revenue Code at the time of the
transfer, and any rollover individual retirement account must be an individual
retirement account within the meaning of Section 408 of the Internal Revenue
Code at the time of the rollover.
(b) The Trustee shall invest the transferred assets as part of the Trust
Fund. The transferred assets, and the earnings and losses attributable to them,
shall be held in separate Rollover Accounts on the books of the Trust for the
benefit of the Participant as described in Section 5.1.
(c) The Plan Administrator and the Trustee shall be fully protected in
relying on data, representations, or other information provided by a Participant
or other Employee for the purpose of determining that the requirements of
subsection (a) have been satisfied.
10.9 GENDER AND NUMBER. Every pronoun used in the Plan shall be construed
to be of such number and gender as the context shall require.
SECTION XI
PLAN ADMINISTRATION
11.1 PLAN ADMINISTRATOR.
(a) The Plan Administrator shall have responsibility for administering the
Plan and carrying out its provisions. The Company, by action of its Board, shall
appoint the Plan Administrator, which shall consist of a committee of not less
than three persons. Any member of the Plan Administrator may be removed and new
members may be appointed by action of the Board.
(b) Any person appointed to be a member of the Plan Administrator shall
give his acceptance in writing to the Company. Any member of the Plan
Administrator may resign by delivering his written resignation to the Company,
and such resignation shall be effective upon such delivery or upon any date
specified in the notice.
(c) For purposes of administering the Plan, the Plan Administrator may
delegate any or all of its duties, powers and responsibilities to one or more
persons or subcommittees, whose members may or may not be members of the Plan
Administrator.
11.2 RESPONSIBILITIES. The Plan Administrator shall have responsibility and
authority to take all action and to make all decisions necessary or proper to
carry out the Plan. The determination of the Plan Administrator as to any
question involving the general administration and interpretation of the Plan
shall be final, conclusive and binding. Any discretionary actions to be taken
under the Plan by the Plan Administrator with respect to the classification of
Employees, Participants, Beneficiaries, contributions, or benefits shall be
uniform in nature and applicable to all persons similarly situated. Without
limiting the generality of the foregoing, the Plan Administrator shall have the
power, duty and express discretionary authority:
(a) To require any person to furnish such information as it may request for
the purpose of the proper administration of the Plan as a condition to receiving
any benefits under the Plan;
(b) To make and enforce such rules and regulations and prescribe the use of
such forms as it shall deem necessary for the efficient administration of the
Plan;
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(c) To interpret the Plan, and to resolve any ambiguity or inconsistency;
(d) To decide questions concerning the eligibility of any Employee to
become a Participant;
(e) To employ counsel, accountants, specialists, agents and such clerical,
medical and other services as the Plan Administrator may require in carrying out
the provisions of the Plan;
(f) To determine the manner in which the assets of the Plan shall be
disbursed;
(g) To authorize one or more persons to make any payment on its behalf, or
to execute or deliver any instrument; and
(h) To appoint an independent fiduciary to carry out activities relating to
the Company Stock Fund if the Trustee so requests in accordance with Section
9.11(b).
The Plan Administrator shall have the power to modify by administrative
practice the time periods set forth in the Plan for filing applications with
respect to withdrawals, distributions and Plan loans. The Plan Administrator
shall exercise its power in a uniform and nondiscriminatory manner in accordance
with applicable law.
11.3 DELEGATION OF DUTIES
(a) To the extent permitted by law, the Plan Administrator and any person
to whom it may delegate any duty or power in connection with the Plan and the
Employer and its officers and directors shall be entitled to rely conclusively
upon, and shall be fully protected in any action taken or suffered by them in
good faith in the reliance upon, any counsel, accountant, other specialist or
other person selected by the Plan Administrator, or in reliance upon any tables,
valuations, certificates, opinions or reports that shall be furnished by any of
them or by the Trustee. To the extent permitted by law, no member of the Plan
Administrator or any subcommittee, nor the Employer or its officers and
directors, shall be liable for any neglect, omission or wrongdoing of the
Trustee or of any other person to whom powers, duties or responsibilities with
respect to the Plan have been delegated.
(b) The Plan Administrator may authorize one or more persons to make any
payment in its behalf, or to execute or deliver any instrument, except that a
requisition for funds from the Trustee shall be signed by two members of the
Plan Administrator or subcommittee that is authorized to sign requisitions.
11.4 EXPENSES. All expenses incurred before termination of the Plan that
shall arise in connection with the administration of the Plan, including, but
not limited to, the compensation of the Trustee, administrative expenses and
other proper charges and disbursements of the Trustee, and compensation and
other expenses and charges of any counsel, accountant, specialist or other
person who shall be employed by the Plan Administrator in connection with the
administration thereof, shall be charged to the Trust Fund and paid by the
Trustee unless paid by the Employers.
11.5 COMPENSATION. Unless otherwise agreed to by the Employer, the members
of the Plan Administrator and any subcommittee shall serve without compensation
for services as such, but all reasonable expenses incurred in the performance of
their duties shall be paid from the Trust Fund. Unless otherwise determined by
the Company or required by law, no officer of the Company and no member of the
Plan Administrator or any subcommittee shall be required to give any bond or
other security in any jurisdiction.
11.6 FACILITY OF PAYMENT. Whenever, in the Plan Administrator's opinion, a
person who is entitled to receive a benefit from the Plan (or an installment
payment of the benefit) is under a legal disability, or other incapacity that
prevents him from managing his financial affairs, the Plan Administrator may
direct the Trustee to make payments to the person, or to his legal
representative, or to a relative or friend of the person for his benefit, or the
Plan Administrator may direct the Trustee to apply the payment for the benefit
of the person. Any payment of a benefit or any installment payment of a benefit
in accordance with the provisions of this Section shall be a complete discharge
of any liability for the making of such payment under the provisions of the
Plan.
11.7 BENEFIT CLAIMS PROCEDURE.
(a) If any person makes a claim regarding the amount of any distribution or
its method of payment, such person shall present the reason for the claim in
writing to the Plan Administrator. The Plan Administrator, in its discretion,
may request a meeting to clarify any matters that it deems pertinent. A claimant
who is denied a claim will, within 90 days of its receipt of the claim, be given
notice by the Plan Administrator that describes:
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(i) The specific reason or reasons for the denial;
(ii) The specific reference to the Plan provisions on which the
denial is based;
(iii) A list of additional material or information (if any) that is
necessary for the claimant to perfect the claim, with an explanation of
why the additional information is needed;
(iv) An explanation of the Plan's claim procedure; and
(v) An explanation that the claimant may request a review of his
claim denial by the Plan Administrator by filing a written request with
the Plan Administrator not more than 60 days after receiving written
notice of the denial and that the claimant, or his representative,
before such review, may review pertinent documents and submit issues and
comments in writing.
(b) If a review of the initial denial is requested and the claim is again
denied, the Plan Administrator shall again give written notice within 60 days of
its decision to deny the claim to the claimant setting forth items (i) and (ii)
above. All final interpretations, determinations and decisions of the Plan
Administrator with respect to any matter hereunder shall be conclusive and
binding upon the Employer, Participants, Employees, and all other persons
claiming interest under the Plan, except as otherwise provided by ERISA.
11.8 DOMESTIC RELATIONS ORDERS.
(a) If the Trustee or the Plan Administrator receives a domestic relations
order that purports to require the payment of a Participant's benefits to a
person other than the Participant, the Plan Administrator shall take the
following steps:
(i) If benefits are in pay status, the Plan Administrator shall
direct the Trustee to withhold payment and to account separately for the
amounts that will be payable to the Alternate Payees (defined below) if
the order is a Qualified Domestic Relations Order (defined below).
(ii) The Plan Administrator shall promptly notify the named
Participant and any Alternative Payees of the receipt of the domestic
relations order and of the Plan Administrator's procedures for
determining if the order is a Qualified Domestic Relations Order.
(iii) The Plan Administrator shall determine whether the order is a
Qualified Domestic Relations Order under the provisions of Internal
Revenue Code Section 414(p).
(iv) The Plan Administrator shall notify the named Participant and
any Alternate Payees of its determination as to whether the order meets
the requirements of a Qualified Domestic Relations Order.
(b) If, within 18 months beginning on the date the first payment would be
made under the domestic relations order (the 18-Month Period), the order is
determined to be a Qualified Domestic Relations Order, the Plan Administrator
shall direct the Trustee to pay the specified amounts to the persons entitled to
receive the amounts pursuant to the order.
(c) If, within the 18-Month Period, (i) the order is determined not to be a
Qualified Domestic Relations Order or (ii) the issue as to whether the order is
a Qualified Domestic Relations Order has not been resolved, the Plan
Administrator shall direct the Trustee to pay the specified amounts to the
Participant or other person who would have been entitled to such amounts if
there had been no order.
(d) If an order is determined to be a Qualified Domestic Relations Order
after the end of the 18-Month Period, the determination shall be applied
prospectively only.
(e) For the purposes of this Section, the following terms shall have the
following definitions:
(i) ALTERNATE PAYEE -- Any spouse, former spouse, child or
other dependent of a Participant who is recognized by a domestic relations order
as having a right to all or a portion of the benefits payable under the
Plan to the Participant.
(ii) QUALIFIED DOMESTIC RELATIONS ORDER -- Any domestic relations
order or judgment that meets the requirements set forth in Internal
Revenue Code Section 414(p).
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SECTION XII
AMENDMENT OF PLAN
12.1 RESERVED POWER TO MODIFY, SUSPEND OR TERMINATE. As future conditions
affecting this Plan cannot be foreseen, the Company, through action of the
Board, reserves the right to amend, modify, suspend, or terminate the Plan. Any
amendment may affect future Participants, but may not diminish the balances in
the Accounts of any Participant or Beneficiary as they existed immediately
before the effective date of the amendment.
12.2 AMENDMENT REQUIRING SHAREHOLDER APPROVAL. If and to the extent
required to comply with Rule 16b-3, any amendment to the Plan made prior to
September 1, 1994 that would (a) materially increase the benefits accruing to
Participants under the Plan, (b) materially increase the number of securities
that may be issued under the Plan, or (c) materially modify the requirements as
to eligibility for participation in the Plan, must be submitted to the
shareholders of the Company for approval. Notwithstanding the foregoing, the
Board may increase the number of investment funds offered under the Plan without
first obtaining the approval of the shareholders of the Company. If the
September 1, 1994 effective date of the current proposed changes to Rule 16b-3
is postponed, the September 1, 1994 date referred to above shall be deemed to
refer to such postponed effective date of the current proposed changes to Rule
16b-3.
12.3 DISTRIBUTION ON TERMINATION OF PLAN. If the Plan is terminated or if
there is a complete discontinuance of contributions to the Plan, with or without
notice, each Participant's interest in his Accounts shall become fully vested. A
partial termination of the Plan, with or without notice, shall be deemed to be a
termination of the Plan resulting in full vesting as to the part of the Plan
that is terminated. In the event of a termination of the Plan, Participants'
Accounts shall be distributed upon a date determined by the Plan Administrator.
SECTION XIII
ADOPTION OF PLAN BY AFFILIATED COMPANIES
13.1 ADOPTION OF THE PLAN. Any Affiliated Company may become an Employer,
with the approval of the Board, by adopting the Plan for its Employees. An
Affiliated Company that becomes a party to the Plan shall promptly deliver to
the Trustee a certified copy of the resolutions or other documents evidencing
its adoption of the Plan. An Affiliated Company adopting the Plan may determine
whether and to what extent periods of employment with the Affiliated Company
before the Affiliated Company adopts the Plan shall be included as Service under
the Plan, and an Affiliated Company may exclude certain classes of Employees
from eligibility to participate in the Plan, as long as the exclusion does not
result in prohibited discrimination under the Internal Revenue Code.
13.2 WITHDRAWAL. An Employer may withdraw from the Plan at any time by
giving the Plan Administrator advance notice in writing of its intention to
withdraw. Upon receipt of notice of a withdrawal, the Plan Administrator shall
certify to the Trustee the equitable share of the withdrawing Employer in the
Trust Fund, and the Trustee shall set aside from the Trust Fund such securities
and other property as it shall, in its sole discretion, deem to be equal in
value to the withdrawing Employer's equitable share. If the Plan is to be
terminated with respect to the withdrawing Employer, the amount set aside shall
be administered according to Section 10.2. If the Plan is not to be terminated
with respect to the withdrawing Employer, the Trustee shall turn over the
withdrawing Employer's equitable share to a trustee designated by the
withdrawing Employer, and the securities and other property shall thereafter be
held and invested as a separate trust of the withdrawing Employer.
13.3 SALE OF EMPLOYER OR DIVISION. If substantially all of the stock or
assets of an Employer or a division of an Employer are sold, the Accounts of
participants who are Employees of the affected Employer or division may be
transferred to a tax-qualified defined contribution plan or the purchaser. If
such a transfer is made, the Accounts of the affected Participants shall be
transferred to a tax-qualified plan of the purchaser, and the affected
Participants shall no longer be entitled to any benefits under this Plan. The
transfer of Accounts shall be full satisfaction of this Plan's obligation to
provide benefits to the affected Participants and their Beneficiaries.
SECTION XIV
TOP HEAVY
14.1 TOP HEAVY. If the Plan is Top Heavy for any Plan Year, then the
provisions of this Section 14 shall apply, notwithstanding anything in the Plan
to the contrary. The determination of Top Heavy status shall be made as follows:
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(a) Top Heavy plans are one or more plans that are qualified under
Internal Revenue Code Section 401(a) and under which the sum of the present
value of accrued benefits of Key Employees under defined benefit plans and
the account balances of Key Employees under defined contribution plans
exceeds 60% of the sum of the present value of accrued benefits and account
balances of all employees, former employees (except for former employees
who perform no services for the Company for the five-year period ending on
the determination date), and beneficiaries in the plans. The determination
date is the date on which it is determined whether this Plan is Top Heavy.
Such determination shall be made as of the last day of the immediately
preceding Plan Year or, in the case of the first Plan Year, the last day of
such Plan Year. The determination shall be made in accordance with Internal
Revenue Code Section 416(g). The account balances under the Plan shall be
valued as of each Valuation Date. Actuarial equivalence and benefit
accruals shall be determined on the basis of the definition of actuarial
equivalence and accrued benefits used for purposes of the James River
Corporation of Virginia Retirement Plan for Salaried and Other
Non-Bargaining Unit Employees, as in effect at the time. If the Company and
Affiliated Companies maintain more than one plan qualified under Internal
Revenue Code Section 401, then (a) each such plan in which a Key Employee
is a participant and (b) each such plan that must be taken into account in
order for a plan described in the preceding clause to meet the requirements
of Internal Revenue Code Section 401(a)(4) or 410 shall be aggregated with
this Plan to determine whether the plans, as a group, are Top Heavy. The
Company and Affiliated Companies may, in their discretion, aggregate any
other qualified plan with this Plan to the extent that such aggregation is
permitted by Internal Revenue Code Section 416(g). The Company will
determine whether the Plan is Top Heavy. For purposes of the preceding
sentence, a Plan includes a terminated plan which was maintained by the
Company within the last five years ending on the determination date and
would otherwise be required to be aggregated with this Plan.
(b) A Key Employee is an Employee, former Employee or Beneficiary who,
at any time during the Plan Year or during any of the four preceding Plan
Years, is or was (i) an officer of the Company or an Affiliated Company
whose annual Taxable Compensation from the Company and Affiliated Company
exceeds 50% of the amount in effect under Internal Revenue Code Section
415(b)(1)(A) for the Plan Year, (ii) one of the ten Employees who own (or
are considered as owning, within the meaning of Section 318 of the Internal
Revenue Code) at least 0.5% and the largest interests in the Company or an
Affiliated Company and whose annual Taxable Compensation from the Company
and Affiliated Companies is at least equal to the amount in effect under
Section 415(c)(1)(A) of the Internal Revenue Code for the Plan Year, (iii)
a 5% owner of the Company or an Affiliated Company, or (iv) a 1% owner of
the Company or an Affiliated Company whose annual Taxable Compensation from
the Company and Affiliated Companies exceeds $150,000. The amount in effect
under Section 415(c)(1)(A) of the Internal Revenue Code for a Plan Year is
the $30,000 amount described in Section of the Plan, as adjusted. The
determination of Key Employee status shall be made in accordance with
Section 416(i) of the Internal Revenue Code, and the number of persons who
are considered Key Employees shall be limited as provided under that
Section.
14.2 MINIMUM ALLOCATION. For any Plan Year in which the Plan is Top Heavy,
either a minimum benefit or a minimum contribution shall be provided for each
Participant who is not a Key Employee and who is not covered by a collective
bargaining agreement under which retirement benefits were the subject of good
faith bargaining. Unless the minimum benefit described in Section 416(c)(1) of
the Internal Revenue Code is provided under a defined benefit plan, the amount
of Company and Affiliated Company contributions and forfeitures that are
allocated under one or more plans maintained by the Company or Affiliated
Companies to the account of each Participant described above who is an Employee
on the last day of the Plan Year shall be at least equal to 5% of the
Participant's Taxable Compensation. This minimum contribution shall be made
under other plans maintained by the Company or Affiliated Companies before it is
made under this Plan. The Company shall have discretion to contribute an amount
needed to satisfy this minimum allocation.
14.3 COMPENSATION LIMITATION. For any Plan Year in which this Plan is Top
Heavy, the amount of a Participant's Taxable Compensation that may be taken into
account under the Plan shall not exceed $150,000 (or an adjusted amount pursuant
to Internal Revenue Code Sections 401(a)(17) and 415(d)). If the Participant is
a 5% owner or is one of the 10 highly compensated employees, as defined in
Internal Revenue Code Section 414(q), earning the most Section 415 Compensation,
such limitation shall be calculated by aggregating the Taxable Compensation of
the Participant and any family member of such Participant who participates in
the Plan. For purposes of this paragraph, the term family member means the
Participant's spouse and lineal descendants who have not attained age 19 by the
close of the Plan Year.
14.4 BENEFIT AND CONTRIBUTION LIMITATIONS. For Plan Years in which the Plan
is Top Heavy, the 1.25 amount in Section 5.3 of the Plan shall be changed to 1.0
unless:
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(a) The sum of the present value of accrued benefits and account
balances of Key Employees under plans aggregated pursuant to Section does
not exceed 90% of the total present value of accrued benefits and account
balances of all participants in the plans, and
(b) The minimum contribution described in Section of the Plan is
increased to 7 1/2% of the Participant's Taxable Compensation.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed this
18th day of February, 1994.
JAMES RIVER CORPORATION OF VIRGINIA
By /s/ DANIEL J. GIRVAN
Senior Vice President, Human Resources
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EXHIBIT B
JAMES RIVER CORPORATION OF VIRGINIA
1987 STOCK OPTION PLAN
1993 AMENDMENT AND RESTATEMENT
JAMES RIVER CORPORATION OF VIRGINIA (the "Company") hereby adopts this
1993 Amendment and Restatement of the James River Corporation of Virginia 1987
Stock Option Plan, effective as of December 16, 1993.
1. PURPOSE. This Stock Option Plan (the "Plan") is intended to advance the
interests of the Company by providing certain key employees who have
substantial responsibility for the direction and management of the Company,
its subsidiaries, and its foreign affiliates with an opportunity to acquire a
proprietary interest in the Company and an additional incentive to promote
its success, as well as to encourage them to remain in the employ of the
Company, a subsidiary of the Company or a foreign affiliate of the Company.
The Plan is intended to conform to the provisions of Securities and Exchange
Commission Rule 16b-3.
2. DEFINITIONS. As used in the Plan, the following terms have the meanings
indicated:
(a) "ACT" means the Securities Exchange Act of 1934, as amended.
(b) "APPLICABLE WITHHOLDING TAXES" means the aggregate amount of federal,
state and local income and payroll taxes that the Company is required
to withhold in connection with any exercise of an Option or Release
Right.
(c) "BOARD" means the Board of Directors of the Company.
(d) "CHANGE OF CONTROL" means:
(i) The acquisition by any unrelated Person of beneficial ownership (as
that term is used for purposes of the Act) of 20% or more of the
then outstanding shares of common stock of the Company or the
combined voting power of the then outstanding voting securities of
the Company entitled to vote generally in the election of directors.
The term unrelated Person means any Person other than (x) the
Company, its Subsidiaries, and its Foreign Affiliates, (y) an
employee benefit plan or trust of the Company or its Subsidiaries or
Foreign Affiliates, and (z) a Person that acquires stock of the
Company pursuant to an agreement with the Company that is approved
by the Board in advance of the acquisition, unless the acquisition
results in a Change of Control pursuant to subsection (ii) below.
(ii) As the result of, or in connection with, any tender or exchange
offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing
transactions, the persons who were directors of the Company before
such transactions shall cease to constitute a majority of the Board
of Directors of the Company or any successor to the Company.
(e) "CODE" means the Internal Revenue Code of 1986, as amended.
(f) "COMMITTEE" means the committee appointed by the Board as described
under Section 13.
(g) "COMPANY" means James River Corporation of Virginia, a Virginia
corporation.
(h) "COMPANY STOCK" means common stock of the Company. In the event of a
change in the capital structure of the Company (as provided in Section
12), the shares resulting from such a change shall be deemed to be
Company Stock within the meaning of the Plan.
(i) "CORPORATE CHANGE" means a consolidation, merger, dissolution, or
liquidation of the Company, a Subsidiary or a Foreign Affiliate, or a
sale or distribution of assets or stock (other than in the ordinary
course of business) of the Company, a Subsidiary, or a Foreign
Affiliate; provided that, unless the Committee determines otherwise, a
Corporate Change shall only be considered to have occurred with respect
to Participants whose business unit is affected by the Corporate
Change.
(j) "DATE OF GRANT" means the date on which an Option is granted by the
Committee.
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(k) "FAIR MARKET VALUE" means (i) if the Company Stock is traded on an
exchange, the mean of the highest and lowest registered sales prices of
the Company Stock on the exchange on which the Company Stock generally
has the greatest trading volume or (ii) if the Company Stock is traded
in the over-the-counter market, the mean between the closing bid and
asked prices as reported by NASDAQ. Fair Market Value shall be
determined as of the applicable date specified in the Plan or, if there
are no trades on such date, the value shall be determined as of the
last preceding day on which the Company Stock is traded.
(l) "FOREIGN AFFILIATE" means an entity that is not organized under the
laws of the United States, or any state thereof or any political
subdivision of any state, and in which the Company has, directly
or indirectly, a substantial interest.
(m) "INCENTIVE STOCK OPTION" means an Option intended to meet the
requirements of, and qualify for favorable federal income tax treatment
under, Code Section 422.
(n) "INSIDER" means a person subject to Section 16(b) of the Act.
(o) "NONSTATUTORY STOCK OPTION" means an Option that does not meet the
requirements of Code Section 422, or that is not intended to be an
Incentive Stock Option and is so designated.
(p) "OPTION" means a right to purchase Company Stock granted under the
Plan, at a price determined in accordance with the Plan.
(q) "PARENT" means, with respect to any corporation, a parent of that
corporation within the meaning of Code section 424(e).
(r) "PARTICIPANT" means an employee who receives a Stock Option under the
Plan.
(s) "PERSON" means an individual, entity or group (as that term is used for
purposes of the Act).
(t) "RELEASE RIGHT" means a right to receive amounts from the Company upon
the exercise of a Nonstatutory Option, as described in Section 7.
(u) "RULE 16b-3" means Rule 16b-3 of the Securities and Exchange Commission
promulgated under the Act. A reference in the Plan to Rule 16b-3 shall
include a reference to any corresponding subsequent rule or any
amendments to Rule 16b-3 enacted after the effective date of the Plan.
(v) "SUBSIDIARY" means with respect to any corporation, a subsidiary of
that corporation within the meaning of Code Section 424(f).
(w) "10% SHAREHOLDER" means a person who owns, directly or indirectly,
stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company or any Parent or Subsidiary of
the Company. Indirect ownership of stock shall be determined in
accordance with Code Section 424(d).
(x) "WINDOW PERIOD" means the period beginning on the third business day
and ending on the twelfth business day following the release for
publication of quarterly or annual summary statements of the Company's
sales and earnings. The release for publication shall be deemed to have
occurred if the specified financial data (i) appears on a wire service,
(ii) appears in a financial news service, (iii) appears in a newspaper
of general circulation, or (iv) is otherwise made publicly available.
3. STOCK. Subject to Section 12 of the Plan, there shall be reserved for
issuance under the Plan an aggregate of 8,000,000 shares of Company Stock,
which shall be authorized, but unissued, shares. The aggregate number of
shares of Company Stock reserved shall be reduced by the issuance of shares
upon the exercise of Options, but it shall not be reduced if Options, for any
reason, expire or terminate unexercised or, to the extent permissible under
Rule 16b-3, if shares are released pursuant to Release Rights or are retained
by the Company in payment of Applicable Withholding Taxes, and such shares
may again be subjected to an Option under the Plan. The Committee is
expressly authorized to make an award of Options to a Participant conditioned
upon the surrender for cancellation of an existing Option.
4. ELIGIBILITY. All present and future key employees of the Company, or any
Subsidiary or Foreign Affiliate of the Company, whether now existing or
hereafter created or acquired, shall be eligible to receive Options under the
Plan. The Committee shall have the power and complete discretion, as provided
in Section 13, to select eligible employees to receive Options and to
determine for each employee the terms and conditions and the number of shares
to be allocated to each employee as part of each Option. Options granted
under the Plan may be Incentive Stock Options or Nonstatutory Stock Options.
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5. GRANT OF STOCK OPTIONS.
(a) Whenever the Committee deems it appropriate to grant Options, notice
shall be given to the Participant stating the number of shares for
which Options are granted, the Option price per share, whether the
Options are Incentive Stock Options or Nonstatutory Stock Options,
whether and the extent to which Release Rights are granted, and the
conditions to which the grant and exercise of the Options are subject.
This notice, when duly accepted in writing by the Participant, shall
become a stock option agreement between the Company and the
Participant.
(b) The exercise price of shares of Company Stock covered by an Option
shall be not less than 100% of the Fair Market Value of such shares on
the Date of Grant; provided that if an Incentive Stock Option is
granted to a Participant who, at the time of the grant, is a 10%
Shareholder, then the exercise price of the shares covered by the
Incentive Stock Option shall be not less than 110% of the Fair Market
Value of such shares on the Date of Grant.
(c) An employee may not receive awards of Options under the Plan with
respect to more than 300,000 shares of Company Stock during any
one-year period.
(d) The grant of an Option shall not obligate the Company or any Subsidiary
or Foreign Affiliate of the Company to pay an employee any particular
amount of remuneration, to continue the employment of the employee
after the grant, or to make further grants to the employee at any time
thereafter.
6. TERM AND LIMITATIONS ON EXERCISE.
(a) Options may be exercised, in whole or in part, but only with respect to
whole shares of Common Stock, at such times and under such conditions
as may be specified in the Participant's stock option agreement. The
Committee may impose such vesting conditions and other requirements as
the Committee deems appropriate, and the Committee may include such
provisions regarding a Change of Control or Corporate Change as the
Committee deems appropriate.
(b) The term of an Incentive Stock Option shall be ten years from the Date
of Grant, except that an Incentive Stock Option granted to a 10%
Shareholder may not have a term in excess of five years. The Committee
shall establish the term of a Nonstatutory Stock Option in the
Participant's stock option agreement. No Option may be exercised after
the expiration of its term or, except as set forth in the Participant's
stock option agreement, after the termination of the Participant's
employment. The Committee shall set forth in the Participant's stock
option agreement when, and under what circumstances, an Option may be
exercised after termination of the Participant's employment.
(c) An Incentive Stock Option, by its terms, shall be exercisable in any
calendar year only to the extent that the aggregate Fair Market Value
(determined at the Date of Grant) of the Company Stock with respect to
which Incentive Stock Options are exercisable by the Participant for
the first time during the calendar year does not exceed $100,000 (the
Limitation Amount). Incentive Stock Options granted under the Plan and
all other plans of the Company and any Parent or Subsidiary of the
Company shall be aggregated for purposes of determining whether the
Limitation Amount has been exceeded. The Committee may impose such
conditions as it deems appropriate on an Incentive Stock Option to
ensure that the foregoing requirement is met. If Incentive Stock
Options that first become exercisable in a calendar year exceed the
Limitation Amount, the excess Options will be treated as Nonstatutory
Stock Options to the extent permitted by law.
(d) If a Participant dies and if the Participant's stock option agreement
provides that part or all of the Option may be exercised after the
Participant's death, then such portion may be exercised by the
Participant's legatees or distributees or by the personal
representative of the Participant's estate during the time period
specified in the stock option agreement.
(e) Notwithstanding anything herein to the contrary, when granting Options
to employees of a Foreign Affiliate, the Committee shall have complete
discretion and authority to grant such Options in accordance with all
present and future applicable laws.
7. RELEASE RIGHTS.
(a) Whenever the Committee deems it appropriate, Release Rights may be
granted in connection with all or any part of a Nonstatutory Option.
Release Rights shall be evidenced in writing as part of the stock
option agreement to which they pertain.
(b) With respect to any exercise of an Option coupled with a Release Right,
the following terms shall have the meanings indicated:
(i) The Exercise Price shall be the price per share at which the Option
may be exercised.
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(ii) The Market Price shall be the Fair Market Value per share of the
Company Stock covered by the Option on the date of exercise.
(iii) The Exercise Number (EN) shall be that portion of the number of
shares which the Participant is currently eligible to receive upon
the exercise of Options and which the Participant desires to use,
either by exercise or by receipt of cash.
(iv) The Tax Rate (TR) shall be that percentage which is equal to the
highest marginal rate at which the Participant's ordinary income
would have been taxed for federal income tax purposes during the
most recent preceding calendar year for which he filed a federal
income tax return (or an amended return) had the gain realized on
account of his exercise of privileges granted pursuant to this Plan
been included in such tax return.
(v) The Releasable Number (RN) shall be that number of shares (or the
next lowest whole number of shares) determined in accordance with
the following formula:
RN = (EN) . (TR)
Notwithstanding the foregoing, the Releasable Number may be
increased if and to the extent necessary to cause the amount of
cash to be paid upon the exercise of Release Rights to be
sufficient to cover the Applicable Withholding Taxes with respect
to the exercise of the Options and Release Rights.
(c) Concurrently with any exercise of an Option that is coupled with a
Release Right, the Participant may release from the Option any number
of whole shares up to the Releasable Number for such exercise and shall
receive in payment for such release an amount in cash equal to the
product of the number of shares so released times the amount by which
the Market Price exceeds the Exercise Price. Such release shall be
effected by an instrument in writing in form satisfactory to the
Committee. If the Releasable Number, as finally determined, shall be
less than the number specified in such writing as released, the release
shall be effective as though the Releasable Number were substituted for
the number specified. Notwithstanding anything herein to the contrary,
to the extent required by Rule 16b-3 or by other properly adopted law,
rules or regulations, the exercise of an Option and the right of a
Participant to exercise a Release Right and to receive cash therefor
shall be effective only if consented to by the Committee.
(d) Upon the exercise of a Release Right and surrender of the related
portion of the underlying Option, the Option, to the extent
surrendered, shall not thereafter be exercisable.
(e) Subject to any further conditions upon exercise imposed by the
Committee, a Release Right shall be exercisable only to the extent that
the related Option is exercisable, and a Release Right shall expire no
later than the date on which the related Option expires.
(f) A Release Right may only be exercised at a time when the Fair Market
Value of the Company Stock covered by the Release Right exceeds the
exercise price of the Company Stock covered by the underlying Option.
(g) If and to the extent required by Rule 16b-3, an Insider may only
exercise a Release Right during a Window Period or otherwise pursuant
to the requirements of Rule 16b-3, and a Release Right held by an
Insider shall not be exercisable during the first six months of its
term. The exercise of a Release Right by an Insider shall be made in
accordance with Rule 16b-3.
8. METHOD OF EXERCISE OF OPTIONS AND RELEASE RIGHTS.
(a) Options and Release Rights may be exercised by giving written notice of
the exercise to the Company, stating the number of shares the
Participant has elected to purchase under the Option and the number of
Release Rights the Participant has elected to exercise. Such notice
shall be effective only if accompanied by the exercise price in full in
cash; provided that, if the terms of an Option so permit, the
Participant (i) may deliver, or cause to be withheld from the Option
shares, shares of Company Stock (valued at their Fair Market Value on
the date of exercise) in satisfaction of all or any part of the
exercise price, or (ii) may deliver a properly executed exercise
notice, together with irrevocable instructions to a broker to deliver
promptly to the Company, from the sale or loan proceeds with respect to
the sale of Company Stock or a loan secured by Company Stock, the
amount necessary to pay the exercise price and, if required by the
Committee, Applicable Withholding Taxes.
(b) Each Participant shall agree, as a condition of the exercise of an
Option or Release Right, to pay to the Company, or to make arrangements
satisfactory to the Company regarding the payment of, Applicable
Withholding Taxes. The Committee may grant Options that permit a
Participant to elect to satisfy Applicable Withholding Taxes by
delivering shares of Company Stock or by directing the Company to
retain that number of shares of Company Stock that will satisfy all or
a specified portion of the Applicable Withholding Taxes. The Committee
may also grant Options
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with automatic withholding of shares to satisfy Applicable Withholding
Taxes. The Committee shall have the sole discretion to approve or
disapprove any election, and any election by an Insider must comply
with Rule 16b-3. Until the Applicable Withholding Taxes have been paid
or arrangements satisfactory to the Company have been made, no stock
certificate shall be issued upon the exercise of an Option or cash paid
upon the exercise of a Release Right.
(c) The Company may place on a certificate representing Company Stock
issued upon the exercise of an Option any legend deemed desirable by
the Company's counsel to comply with federal or state securities laws,
and the Company may require a customary written indication of the
Participant's investment intent. Until the Participant has made all
required payments, including any Applicable Withholding Taxes, and has
been issued a certificate for the shares of Company Stock acquired, the
Participant shall possess no shareholder rights with respect to the
shares.
(d) Notwithstanding anything herein to the contrary, with respect to
Insiders, Options and Release Rights shall always be granted and
exercised in such a manner as to conform to the provisions of Rule
16b-3.
9. NONTRANSFERABILITY OF OPTIONS AND RELEASE RIGHTS.
(a) Options and Release Rights, by their terms, shall not be transferable
except by will or by the laws of descent and distribution and shall be
exercisable, during the Participant's lifetime, only by the
Participant.
(b) Notwithstanding the foregoing, the Committee may grant Nonstatutory
Stock Options and Release Rights that permit a Participant to transfer
the Options and Release Rights to a family member (as defined by the
Committee) or to a trust established by the Participant or a family
member; provided that no Incentive Stock Options may be transferrable,
and no Options granted to Insiders may be transferrable unless and
except to the extent permitted by Rule 16b-3. The Committee may impose
on any transferrable Options and Release Rights such limitations and
conditions as the Committee deems appropriate.
10. EFFECTIVE DATE OF THE PLAN. This Plan was originally effective as of
February 12, 1987. The 1993 Amendment and Restatement of the Plan shall be
effective as of December 16, 1993. The restated Plan shall be submitted to
the shareholders of the Company for approval. Options granted before the
1993 Amendment and Restatement shall be governed by the terms of the Plan as
in effect before the 1993 Amendment and Restatement, except to the extent
that the Committee, in its sole discretion, specifies otherwise. The
provisions of the 1993 Amendment and Restatement shall not apply to an
Option or Release Right granted on or before February 17, 1993 if such
provisions would cause the Option or Release Right to be subject to the
limitations of Code Section 162(m).
11. TERMINATION, MODIFICATION. If not sooner terminated by the Board, the Plan
shall terminate at the close of business on February 12, 1997. No Options
shall be awarded under the Plan after its termination. The Board may
terminate the Plan or may amend the Plan in such respects as it shall deem
advisable; provided that (i) if and to the extent required by the Code or
Rule 16b-3, no change shall be made that increases the total number of
shares of Company Stock reserved for issuance pursuant to Options granted
under the Plan (except pursuant to Section 12), materially modifies the
requirements as to eligibility for participation in the Plan, or materially
increases the benefits accruing to Participants under the Plan, unless such
change is authorized by the shareholders of the Company and (ii) to the
extent required to meet the requirements of Code Section 162(m) for
performance-based compensation, any amendment that makes a material change
to the Plan must be approved by the shareholders of the Company. The Board
may unilaterally amend the Plan and Options as it deems appropriate to
ensure compliance with Rule 16b-3 and to cause Options to meet the
applicable requirements of the Code. Except as provided in the preceding
sentence, a termination or amendment of the Plan shall not, without the
consent of the Participant, adversely affect a Participant's rights under an
Option previously granted to the Participant.
12. CHANGE IN CAPITAL STRUCTURE.
(a) In the event of a stock dividend, stock split, combination of shares,
recapitalization, merger, consolidation or other change in the
Company's capital stock (including, but not limited to, the creation or
issuance to shareholders generally of rights, options or warrants for
the purchase of common stock or preferred stock of the Company), the
number and kind of shares of stock or other securities to be issued
under the Plan (under Options then outstanding and Options to be
granted in the future), the exercise price, and any other relevant
provisions shall be appropriately adjusted by the Committee, whose
determination shall be binding on all persons. If the adjustment would
produce fractional shares with respect to any unexercised Option, the
Committee may adjust appropriately the number of shares covered by the
Option so as to eliminate the fractional shares.
(b) In the event the Company distributes to its shareholders as a dividend,
or sells or causes to be sold to a Person other than the Company or a
Subsidiary or affiliate, shares of stock in any corporation (a Spin-off
Company) which, immediately before the distribution or sale, was a
majority-owned subsidiary of the Company, the Committee shall
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have the power, in its sole discretion, to make such adjustments as the
Committee deems appropriate. The Committee may make adjustments in the
number and kind of shares or other securities to be issued under the
Plan (under Options then outstanding and Options to be granted in the
future), the exercise price, and any other relevant provisions, and,
without limiting the foregoing, may substitute securities of the
Spin-off Company for securities of the Company. The Committee shall
make such adjustments as it determines to be appropriate, considering
the economic effect of the distribution or sale on the interests of the
Company's shareholders and the Participants in the businesses operated
by the Spin-off Company. The Committee's determination shall be binding
on all persons. If the adjustment would produce fractional shares with
respect to any unexercised Option, the Committee may adjust
appropriately the number of shares covered by the Option so as to
eliminate the fractional shares.
(c) If a Change of Control or Corporate Change occurs, the Committee may
take such actions with respect to outstanding Options and Release
Rights as the Committee deems appropriate. These actions may include,
but shall not be limited to, accelerating the expiration date of any or
all outstanding Options and Release Rights and the dates on which any
part of the Options and Release Rights may be exercised, in which case
they shall be exercisable in full on dates designated by the Committee.
The effectiveness of such acceleration, and any exercise of Options and
Release Rights pursuant thereto with respect to shares in excess of the
number of shares which could have been exercised in the absence of such
acceleration, shall be conditioned upon the consummation of the
applicable Change of Control or Corporate Change.
(d) Notwithstanding anything in the Plan to the contrary, the Committee may
take the foregoing actions without the consent of any Participant, and
the Committee's determination shall be conclusive and binding on all
persons for all purposes. The Committee shall make its determinations
consistent with Rule 16b-3 and the applicable provisions of the Code.
13. ADMINISTRATION OF THE PLAN.
(a) The Plan shall be administered by the Committee. The Committee shall be
appointed by the Board and shall consist of not less than two members
of the Board. The Committee shall be the Compensation Committee of the
Board, unless the Board shall appoint another compensation committee to
administer the Plan. If and to the extent required by Rule 16b-3, all
members of the Committee shall be disinterested persons , as that term
is defined in Rule 16b-3, and the Committee shall be comprised solely
of two or more outside directors, as that term is defined for purposes
of Code Section 162(m). If any member of the Committee fails to qualify
as an outside director or (to the extent required by Rule 16b-3) a
disinterested person, such person shall immediately cease to be a
member of the Committee and shall not take part in future Committee
deliberations. The Board from time to time may appoint members of the
Committee and may fill vacancies, however caused, in the Committee.
(b) The Committee shall have authority to impose such limitations or
conditions upon an Option or Release Right as the Committee deems
appropriate to achieve the objectives of the Plan. Without limiting the
foregoing and in addition to the powers set forth elsewhere in the
Plan, the Committee shall have the power and complete discretion to
determine (i) which eligible employees shall receive Options and
whether Options shall be Incentive Stock Options or Nonstatutory Stock
Options, (ii) the number of shares of Company Stock to be covered by
each Option, (iii) when, whether and to what extent Release Rights
shall be granted in connection with Options, (iv) the Fair Market Value
of Company Stock, (v) the time or times at which Options shall be
granted, (vi) whether an Option shall become vested over a period of
time, according to a performance-based vesting schedule or otherwise,
and when it shall be fully vested, (vii) whether the Participant, the
Company or a business unit has met the conditions set forth in the Plan
or the stock option agreement with respect to the exercisability of the
Option, (viii) when Options may be exercised, (ix) whether a Change of
Control or Corporate Change exists, (x) conditions relating to the
length of time before disposition of Company Stock received upon the
exercise of Options is permitted, (xi) notice provisions relating to
the sale of Company Stock acquired under the Plan, and (xii) any
additional requirements relating to Options and Release Rights that the
Committee deems appropriate. Notwithstanding the foregoing, no tandem
stock options (where two stock options are issued together and the
exercise of one option affects the right to exercise the other option)
may be issued in connection with Incentive Stock Options.
(c) The Committee shall have the power to amend the terms of previously
granted Options, so long as the terms as amended are consistent with
the terms of the Plan and, where applicable, consistent with the
qualification of the Option as an Incentive Stock Option. The consent
of the Participant must be obtained with respect to any amendment that
would adversely affect a Participant's rights under the Option, except
that such consent will not be required if the amendment is for the
purpose of complying with Rule 16b-3 or any requirement of the Code
applicable to the Option.
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(d) The Committee may adopt rules and regulations for carrying out the
Plan. The Committee shall have the express discretionary authority to
construe and interpret the Plan and the stock option agreements, to
resolve any ambiguities, to define any terms, and to make any other
determinations required by the Plan or the stock option agreements. The
interpretation and construction of any provision of the Plan or a stock
option agreement by the Committee shall be final and conclusive. The
Committee may consult with counsel, who may be counsel to the Company,
and shall not incur any liability for any action taken in good faith in
reliance upon the advice of counsel.
(e) A majority of the members of the Committee shall constitute a quorum,
and all actions of the Committee shall be taken by a majority of the
members present. Any action may be taken by a written instrument signed
by all of the members, and any action so taken shall be fully effective
as if it had been taken at a meeting.
14. NOTICE. All notices and other communications required or permitted to be
given under this Plan shall be in writing and shall be deemed to have been
duly given if delivered personally or mailed first class, postage prepaid,
as follows (a) if to the Company - at its principal business address to the
attention of the Treasurer; (b) if to any Participant - at the last address
of the Participant known to the sender at the time the notice or other
communication is sent.
15. INTERPRETATION. The terms of this Plan are subject to all present and future
regulations and rulings of the Secretary of the Treasury relating to the
qualification of Incentive Stock Options under the Code and the
qualification of the Plan as performance-based compensation under Code
Section 162(m), and they are subject to all present and future rulings of
the Securities Exchange Commission with respect to Rule 16b-3. If any
provision of the Plan would cause Incentive Stock Options to fail to meet
the applicable requirements of the Code, would cause the Plan to fail to
meet the Code Section 162(m) requirements for performance-based
compensation, or would cause the Plan to fail to meet the requirements of
Rule 16b-3 as applicable to Insiders, then that provision of the Plan shall
be void and of no effect. The terms of this Plan shall be governed by the
laws of the Commonwealth of Virginia.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed on this
10th day of December, 1993.
JAMES RIVER CORPORATION OF VIRGINIA
By /S/ CLIFFORD A. CUTCHINS, IV
Senior Vice President, General Counsel,
Corporate Secretary
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EXHIBIT C
JAMES RIVER CORPORATION OF VIRGINIA
DEFERRED STOCK PLAN
1993 AMENDMENT AND RESTATEMENT
JAMES RIVER CORPORATION OF VIRGINIA, a Virginia corporation (the
"Company"), has adopted this 1993 Amendment and Restatement of its Deferred
Stock Plan, effective as of December 16, 1993. The Company further amended this
Plan at its February 1994 Board of Directors meeting, effective as of
December 16, 1993. This document reflects the amendment.
1. PURPOSE. This Deferred Stock Plan (the "Plan") is intended to advance the
interests of the Company by providing certain senior executive officers of
the Company and its subsidiaries with an additional incentive to promote the
Company's success and to encourage them to remain in the employ of the
Company or a subsidiary of the Company. The Plan is intended to conform to
the provisions of Rule 16b-3 of the Securities Exchange Act of 1934.
2. DEFINITIONS. Whenever used in the Plan, the following terms shall have the
meanings set forth below unless the context clearly requires a different
meaning:
a. "ACT" The Securities Exchange Act of 1934, as amended.
b. "APPLICABLE WITHHOLDING TAXES" The aggregate amount of federal, state
and local income and payroll taxes that the Company is required to
withhold in connection with a distribution under the Plan.
c. "AWARD" An award of deferred stock under the Plan.
d. "BENEFICIARY" The person or entity determined to be a Participant's
Beneficiary pursuant to Section 11.
e. "BOARD" The Company's Board of Directors.
f. "BOOK ACCOUNT" A book account established on the records of the Company
for a Participant.
g. "CHANGE OF CONTROL"
i. The acquisition by any unrelated Person of beneficial ownership (as
that term is used for purposes of the Act) of 20% or more of the then
outstanding shares of common stock of the Company or the combined
voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors. The term
unrelated Person means any Person other than (x) the Company, its
subsidiaries, and its affiliates, (y) an employee benefit plan or
trust of the Company or its subsidiaries or affiliates, and (z) a
Person that acquires stock of the Company pursuant to an agreement
with the Company that is approved by the Board in advance of the
acquisition, unless the acquisition results in a Change of Control
pursuant to subsection (ii) below.
ii. As the result of, or in connection with, any tender or exchange
offer, merger or other business combination, sale of assets or
contested election, or any combination of the foregoing
transactions, the persons who were directors of the Company before
such transactions shall cease to constitute a majority of the Board
of Directors of the Company or any successor to the Company.
h. "CODE" The Internal Revenue Code of 1986, as amended.
i. "COMMITTEE" The committee appointed by the Board to administer this
Plan.
j. "COMPANY" James River Corporation of Virginia, and any successor by
merger or otherwise.
k. "COMPANY STOCK" Common stock of the Company. In the event of a change
in the capital structure of the Company (as provided in Section 14),
the shares resulting from such a change shall be deemed to be Company
Stock within the meaning of the Plan.
l. "CORPORATE CHANGE" A consolidation, merger, dissolution, or liquidation
of the Company or a subsidiary, or a sale or distribution of assets or
stock (other than in the ordinary course of business) of the Company or
a subsidiary; provided
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that, unless the Committee determines otherwise, a Corporate Change shall
only be considered to have occurred with respect to Participants whose
business unit is affected by the Corporate Change.
m. "INSIDER" A person subject to Section 16(b) of the Act.
n. "PARTICIPANT" A senior executive officer of the Company or a subsidiary
who has been selected by the Committee to participate in the Plan.
o. "PERSON" An individual, entity or group (as that term is used for
purposes of the Act).
p. "PLAN" The James River Corporation of Virginia Deferred Stock Plan.
q. "RULE 16b-3" Rule 16b-3 of the Act, including any corresponding
subsequent rule or any amendments to Rule 16b-3 enacted after the
effective date of the Plan.
3. ELIGIBILITY. The Committee shall grant Awards to certain senior executive
officers of the Company and its subsidiaries who have rendered, and who are
expected to continue to render, extraordinarily valuable services that are
vital to the long-term success of the Company and its subsidiaries. The
Committee shall choose the Participants and shall determine the value of the
Award to be granted to each Participant and the vesting schedule and other
terms of the Award.
4. AWARDS. The value of an Award shall be determined as a dollar amount. As of
the date of the Award, the Award shall be converted into hypothetical shares
of Company Stock at the fair market value of the Company Stock as of the
business day immediately preceding the date on which the Award is granted.
The Company shall establish a Book Account on its records for the Participant
and shall credit to the Participant's Book Account the number of hypothetical
shares of Company Stock granted pursuant to the Award. No actual shares of
Company Stock or other certificates shall be issued when an Award is granted.
5. DIVIDENDS.
a. As of the last day of each fiscal year of the Company, each Participant's
Book Account shall be adjusted to take into account dividends that were
declared on Company Stock during the fiscal year. The Committee shall
first determine the amount of dividends that were declared as of each
record date during the fiscal year with respect to shares of Company Stock
equal to the number of hypothetical shares of Company Stock that were
credited to the Participant's Book Account as of the record date. The
total dividends shall then be converted into hypothetical shares of
Company Stock by dividing the amount of the dividends by the fair market
value of the Company Stock on the last business day of the fiscal year,
and the nearest whole number of hypothetical shares of Company Stock so
determined shall be credited to the Participant's Book Account.
b. For the year in which the final payment is to be made from a Participant's
Book Account, dividends shall be credited to the Participant's Book
Account as of the date of the final payment. Dividends will be credited in
a manner similar to that described above, based on the amount of dividends
declared on Company Stock since the last day of the preceding fiscal year
and the fair market value of Company Stock at the time payment is made.
6. VESTING. A Participant's interest in the amount credited to his Book Account
from time to time shall become vested in accordance with a vesting schedule
established by the Committee. The vesting schedule shall provide that a
Participant's interest shall become vested in annual increments over a period
of time determined by the Committee, beginning no earlier than the first
anniversary of the date on which the Award is granted. The Committee may
establish a different vesting schedule for each Participant. If a Participant
dies while he is employed by the Company or a subsidiary, his interest in his
Book Account shall become 100% vested. If a Participant becomes disabled
while he is employed by the Company or a subsidiary, 50% of his non-vested
interest in his Book Account shall become vested, and the balance of his
non-vested interest shall be forfeited. The Committee shall have complete
discretion to determine whether a Participant has become disabled.
7. ELECTION OF FORM OF PAYMENT. When the Committee determines that an Award is
to be granted, the Committee shall give the Participant an opportunity to
elect, from the forms of payment described below, the form in which the
amount credited to his Book Account is to be paid. The Participant must make
the election in writing when he is first notified that he will be granted an
Award. The election shall be irrevocable and may not be modified by the
Participant.
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a. PRE-RETIREMENT FORM. The Participant may elect the pre-retirement form of
payment, under which the amount credited to his Book Account will be paid
to him in increments as it becomes vested.
b. POST-RETIREMENT FORM. The Participant may elect the post-retirement form
of payment, under which the amount credited to his Book Account will be
paid to the Participant in substantially equal annual installments after
his retirement from employment with the Company and its subsidiaries at or
after age 65. At the time the Participant makes his election, the
Participant shall designate the period over which the installment payments
will be made. The Committee will have discretion to modify the form of
installment payment designated by the Participant, if the Committee deems
such a modification to be appropriate and in the best interests of the
Company. If a Participant elects the post-retirement form of payment and
dies after the installment payments begin, the remaining installments will
be paid to the Participant's Beneficiary. All elections under this Section
7 shall be made subject to the provisions of Section 10.
8. TERMINATION OF EMPLOYMENT; FORFEITURES. If a Participant dies or otherwise
terminates employment before he reaches age 65, any portion of the
Participant's vested interest in his Book Account that has not previously
been distributed shall be paid to the Participant (or, in the case of his
death, to his Beneficiary) as follows:
a. Unless the Committee determines otherwise, if (i) the Participant's
termination of employment occurs because he retires at or after age 55,
dies or becomes disabled and (ii) the Participant elected the
post-retirement form of payment pursuant to Section 7(b), then the
Participant's vested interest in his Book Account shall be paid in the
manner selected by the Participant pursuant to Section 7(b), commencing at
a date determined by the Committee.
b. In all other cases, the distributable amount shall be paid in
substantially equal annual installments over a 15-year period, or in such
other form of payment, within a period not exceeding 15 years, as the
Committee deems appropriate and in the best interests of the Company.
The Participant's non-vested interest in his Book Account shall be forfeited if
his employment terminates for any reason before age 65, in which case an amount
equal to his non-vested interest as of the date on which his employment
terminates shall be debited from his Book Account.
9. PAYMENT.
a. The amount credited to each Participant's Book Account shall be paid to the
Participant according to the form of payment selected by the Participant
pursuant to Section 7, unless the Participant dies or otherwise terminates
employment before age 65 and except as provided in Section 10. If the
Participant dies or otherwise terminates employment before age 65, the
Participant or his Beneficiary shall be entitled to payments only pursuant
to Section 8, subject to the provisions of Section 10. Distributions shall
be made within 30 days after the specified payment date.
b. The Committee shall determine whether a payment shall be made (i) in whole
shares of Company Stock equal to the number of hypothetical whole shares
of Company Stock to be distributed or (ii) in a combination of whole
shares of Company Stock and cash, in such proportions as the Committee
deems appropriate. When a payment is made partly in cash, the hypothetical
shares of Company Stock then credited to the Participant's Book Account
shall be valued, for purposes of the payment, at the fair market value of
Company Stock at the time the payment is made. The Committee shall have
sole discretion to determine the form of payment.
c. The Company shall not be required to issue or deliver any certificate for
shares of Company Stock before (i) the admission of such shares to listing
on any stock exchange on which the Company Stock may then be listed, (ii)
completion of any required registration or other qualification of such
shares under state or federal law or regulation that the Committee shall,
in its sole discretion, determine is necessary or advisable, and (iii) the
Committee shall have been advised by counsel that all applicable legal
requirements have been complied with.
d. All benefits under the Plan shall be paid subject to required Applicable
Withholding Taxes. Applicable Withholding Taxes will automatcially be
withheld from all payments.
10. DEFERRAL OF PAYMENT.
a. The Committee shall defer payment of a Participant's Plan benefit if and to
the extent that the sum of (i) the Participant's Plan benefit, plus (ii)
all other compensation paid or payable to the Participant for the fiscal
year in which the Plan benefit would otherwise be paid, exceeds the maximum
amount of compensation that the Company may deduct under Code Section
162(m) with respect to the Participant for the year. A benefit deferred
pursuant to this Section 10(a)
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shall be paid in the first fiscal year of the Company in which the sum of
the Participant's Plan benefit and all other compensation paid or payable
to the Participant does not exceed the maximum amount of compensation
deductible by the Company under Code Section 162(m). This Section 10(a)
shall only apply to Participants and Plan benefits covered by Code Section
162(m) and shall apply only if and to the extent that the deferral will
cause the Plan benefits to be deductible in a future year.
b. The Committee may defer payment of part or all of a Plan benefit with
respect to a Participant who is an Insider, to the extent necessary or
appropriate to comply with Rule 16b-3.
c. The Committee shall have sole discretion to determine whether and to what
extent Plan benefits are to be deferred pursuant to this Section 10 and
when deferred payments shall be made. The Committee's determination shall
be final and binding.
11. BENEFICIARY. A Participant may designate, on a form provided by the
Committee, one or more Beneficiaries to receive any payments that are to be
made under the Plan after the Participant's death. If a Participant makes no
valid designation, or if the designated Beneficiary fails to survive the
Participant or otherwise fails to receive the benefits, then the
Participant's Beneficiary shall be the first of the following persons who
survives the Participant: (a) the Participant's spouse (that is, the person
to whom the Participant is legally married when the Participant dies), (b)
the Participant's surviving descendants, PER STIRPES, or (c) the personal
representative of the Participant's estate.
12. FAIR MARKET VALUE OF COMMON STOCK. For purposes of the Plan, if the Company
Stock is traded in the over-the-counter market, its fair market value on a
given day shall be the mean between the closing bid and asked prices on such
day as reported by NASDAQ. If the Company Stock is traded on an exchange,
its fair market value on a given day shall be the closing price of the
Company Stock on such day on the exchange on which it generally has the
greatest trading volume. Fair market value shall be determined as of the
applicable date specified in the Plan or, if there are no trades on such
date, the value shall be determined as of the last preceding day on which
the Company Stock is traded.
13. ADMINISTRATION.
a. The Plan shall be administered by a Committee of two or more directors of
the Company, who shall be appointed by the Board. If and to the extent
required by Rule 16b-3, the Committee shall consist solely of
disinterested persons as that term is defined in Rule 16b-3. If any member
of the Committee fails to qualify as a disinterested person, such person
shall immediately cease to be a member of the Committee and shall not take
part in future Committee deliberations. The Board from time to time may
appoint members of the Committee and may fill vacancies, however caused,
in the Committee.
b. The Committee may adopt rules and regulations from time to time for
carrying out the Plan. The Committee may impose such restrictions and
requirements on Awards as it deems appropriate to ensure compliance with
Rule 16b-3.
c. The Committee has the express discretionary authority to construe and
interpret the Plan, to resolve any ambiguities, to define any terms, to
make determinations with respect to the eligibility for or amount of
benefits, and to make any other determinations required by the Plan. The
interpretation and construction of the Plan's provisions by the Committee
shall be final and conclusive. The Committee may consult with counsel, who
may be counsel to the Company, and shall not incur any liability for any
action taken in good faith in reliance upon the advice of counsel. All
actions of the Committee shall be binding and conclusive on all persons
for all purposes.
14. CHANGE IN CAPITAL STRUCTURE.
a. In the event of a stock dividend, stock split, combination of shares,
recapitalization, merger, consolidation or other change in the Company's
capital stock (including, but not limited to options or warrants for the
purchase of common stock or preferred stock of the Company), the number
and kind of shares of stock or other securities to be issued under the
Plan, the number and kind of hypothetical shares of stock or other
securities allocated to Book Accounts, and any other relevant provisions
shall be appropriately adjusted by the Committee, whose determination
shall be binding on all persons. If the adjustment would produce
fractional shares with respect to any Award, the Committee may adjust
appropriately the number of shares covered by the Award so as to eliminate
the fractional shares.
C-4

<PAGE>
b. In the event the Company distributes to its shareholders as a dividend, or
sells or causes to be sold to a Person other than the Company or a
subsidiary or affiliate, shares of stock in any corporation (a Spin-off
Company) which, immediately before the distribution or sale, was a
majority-owned subsidiary of the Company, the Committee shall have the
power, in its sole discretion, to make such adjustments as the Committee
deems appropriate. The Committee may make adjustments in the number and
kind of shares or other securities to be issued under the Plan, the number
and kind of hypothetical shares of stock or other securities allocated to
Book Accounts, and any other relevant provisions, and, without limiting
the foregoing, may substitute securities of the Spin-off Company for
securities of the Company. The Committee shall make such adjustments as it
determines to be appropriate, considering the economic effect of the
distribution or sale on the interests of the Company's shareholders and
the Participants in the businesses operated by the Spin-off Company. The
Committee's determination shall be binding on all persons. If the
adjustment would produce fractional shares with respect to any Award, the
Committee may adjust appropriately the number of shares covered by the
Award so as to eliminate the fractional shares.
c. If a Change of Control or Corporate Change occurs, the Committee may take
such actions with respect to outstanding Awards as the Committee deems
appropriate. These actions may include, but shall not be limited to,
accelerating the vesting and payment of Awards. The effectiveness of such
acceleration shall be conditioned upon the consummation of the applicable
Change of Control or Corporate Change.
d. Notwithstanding anything in the Plan to the contrary, the Committee may
take the foregoing actions without the consent of any Participant, and the
Committee's determination shall be conclusive and binding on all persons
for all purposes. The Committee shall make its determinations consistent
with Rule 16b-3 and the applicable provisions of the Code.
15. NUMBER. Up to 2,050,000 shares of Company Stock may be issued pursuant to
the Plan, subject to the provisions of Section 14.
16. CLAIMS PROCEDURE.
a. Each Participant (or Beneficiary of a deceased Participant) shall be
entitled to file with the Committee a written claim for benefits under
this Plan. The Committee will review the claim. If the claim is denied,
in whole or in part, the Committee will furnish the claimant, within 90
days after the Committee's receipt of the claim (or within 180 days after
such receipt, if special circumstances require an extension of time), a
written notice of denial of the claim containing the following:
i. Specific reasons for the denial,
ii. Specific reference to the pertinent Plan provisions on which the
denial is based,
iii. A description of any additional material or information necessary
for the claimant to perfect the claim, and an explanation of why
the material or information is necessary, and
iv. An explanation of the claims review procedure.
b. The claimant may request a review of the claim denial by an appeals
committee appointed by the Board. The review may be requested in writing
at any time within 90 days after the claimant receives written notice of
the denial of his claim. The committee shall afford the claimant a full
and fair review of the decision denying the claim and, if so requested,
shall:
i. Permit the claimant to review any documents that are pertinent to the
claim,
ii. Permit the claimant to submit to the committee issues and comments
in writing, and
iii. Afford the claimant an opportunity to meet with a quorum of the
committee as part of the review procedure.
The committee's decision on review shall be made in writing and shall be
issued within 60 days following receipt of the request for review. The
period for decision may be extended to a date not later than 120 days after
such receipt if the committee determines that special circumstances require
an extension. The decision on review shall include specific reasons for the
decision and specific references to the Plan provisions on which the
decision of the committee is based.
C-5

<PAGE>
17. RIGHTS UNDER THE PLAN. Title to and beneficial ownership of all benefits
described in the Plan shall at all times remain with the Company.
Participation in the Plan, the crediting of amounts to Book Accounts, and
the right to receive payments under this Plan shall not give a Participant
or Beneficiary any proprietary interest in the Company, any subsidiary or
any of their assets. No trust fund shall be created in connection with the
Plan, and there shall be no required funding of amounts that may become
payable under the Plan. A Participant and his Beneficiary shall, for all
purposes, be general creditors of the Company. The interests of a
Participant and his Beneficiary in the Plan cannot be assigned, anticipated,
sold, encumbered or pledged and shall not be subject to claims of their
creditors. Nothing in the Plan shall confer upon any Participant the right
to continue in the employ of the Company or any subsidiary or shall
interfere with or restrict in any way the rights of the Company and its
subsidiaries to discharge an employee at any time for any reason whatsoever,
with or without good cause.
18. TERMINATION OF THE PLAN. Awards may be granted at any time until the Plan is
terminated by the Board, or until such earlier date when termination of the
Plan shall be required by applicable law.
19. AMENDMENTS. The Board may from time to time make such changes in and
additions to the Plan as it may deem proper; provided that, if and to the
extent required by Rule 16b-3, no change shall be made that increases the
number of shares of Common Stock that may be issued under the Plan (except
pursuant to Section 14), expands the class of persons eligible to receive
Awards, or materially increases the benefits accruing to Participants under
the Plan, unless such change is authorized by the shareholders. The Board
may unilaterally amend the Plan as it deems appropriate to ensure compliance
with Rule 16b-3. Except as provided in the preceding sentence, the
termination of the Plan or any change or addition to the Plan shall not,
without the consent of a Participant who is adversely affected thereby,
alter any Awards previously granted to the Participant.
20. EFFECTIVE DATE. The Plan became effective on June 14, 1984. The 1993
Amendment and Restatement shall be effective as of December 16, 1993, and
shall be submitted to the shareholders of the Company for approval. Awards
granted before the 1993 Amendment and Restatement shall be governed by the
terms of the Plan as in effect before the 1993 Amendment and Restatement,
except as provided in Section 9(d) and except to the extent that the
Committee, in its sole discretion, specifies otherwise. The provisions of
the 1993 Amendment and Restatement shall not apply to an Award granted on or
before February 17, 1993 if such provisions would cause the Award to be
subject to the limitations of Code Section 162(m).
21. SUCCESSORS. The Plan shall be binding upon the Participants and their
Beneficiaries and personal representatives. If the Company becomes a party
to any merger, consolidation, reorganization or other corporate transaction,
the Plan shall remain in full force and effect as an obligation of the
Company or its successor in interest.
22. CONSTRUCTION. The Plan shall be governed by and construed in accordance with
the laws of the Commonwealth of Virginia.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed on this
24th day of February, 1994.
JAMES RIVER CORPORATION OF VIRGINIA
By /S/ CLIFFORD A. CUTCHINS, IV
Senior Vice President, General Counsel,
Corporate Secretary
C-6

<PAGE>
EXHIBIT D
JAMES RIVER CORPORATION OF VIRGINIA
1993 PROFIT SHARING PLAN
FOR SALARIED EMPLOYEES
EFFECTIVE AS OF DECEMBER 27, 1993
JAMES RIVER CORPORATION OF VIRGINIA, a Virginia corporation
(the "Company"), hereby adopts the 1993 Profit Sharing Plan for Salaried
Employees (the "Plan"), subject to shareholder approval. This Plan supersedes
the Company's existing Profit Sharing Plan for Salaried Employees, effective
for the Company's fiscal year beginning December 27, 1993, and subsequent
years. The Plan has been adopted by the Board of Directors of the Company and
will be submitted to the Company's shareholders for approval at the 1994 annual
shareholders' meeting.
1. PURPOSE. The Plan is a bonus plan and is intended to advance the
interests of the Company by providing eligible salaried employees with annual
incentives to increase the productivity of the Company and its subsidiaries.
2. DEFINITIONS. Whenever used in the Plan, the following terms shall have
the meanings set forth below unless the context clearly requires a different
meaning:
(a) CODE. The Internal Revenue Code of 1986, as amended.
(b) COMMITTEE. The compensation committee appointed by the Board to
administer this Plan pursuant to Section 9.
(c) COMPANY. James River Corporation of Virginia and any successor by
merger or otherwise.
(d) DISABLED. The meaning given this term in the James River
Corporation of Virginia Long Term Disability Plan, as in effect from time
to time.
(e) DIVESTITURE. A sale or other divestiture by the Company of the
business unit in which an employee is employed.
(f) EARLY RETIREMENT DATE. The meaning given this term in the James
River Corporation of Virginia Retirement Plan for Salaried and Other
Non-Bargaining Unit Employees, as in effect from time to time.
(g) JOB ELIMINATION. The elimination of an employee's position under
circumstances in which the employee is entitled to salary continuation
under the terms of the James River Corporation of Virginia Salary
Continuation Plan, as in effect from time to time.
(h) NON-EXEMPT EMPLOYEE. An employee who is not exempt from the
minimum wage and maximum hour requirements of the Fair Labor Standards Act.
(i) NORMAL RETIREMENT DATE. The meaning given this term in the James
River Corporation of Virginia Retirement Plan for Salaried and Other
Non-Bargaining Unit Employees, as in effect from time to time.
(j) PLAN. The James River Corporation of Virginia Profit Sharing Plan
for Salaried Employees.
(k) PROFIT SHARING POOL. The total amount designated to be paid as
profit sharing awards for a fiscal year pursuant to Section 5.
(l) RL. The responsibility level assigned to an employee pursuant to
the attached Chart 2.
(m) SALARY. An employee's base salary in effect as of the last day of
the fiscal year (pro rated for employees who are entitled only to a pro
rata distribution), plus, in the case of a Non-Exempt Employee, any
overtime paid to the employee during the fiscal year.
D-1

<PAGE>
3. ELIGIBILITY.
(a) Except as provided below, all regular non-bargaining unit salaried
employees (excluding employees who participate in other short-term bonus or
incentive plans) of the Company and its U.S. and Canadian subsidiaries are
eligible to participate in the Plan. Employees who transfer to regular
non-bargaining unit salaried status during a fiscal year and eligible employees
who cease participating in other short-term bonus or incentive plans will be
eligible to participate in this Plan on a time-weighted basis from their date of
eligibility. Employees who transfer to hourly or bargaining unit status or who
become eligible to participate in other short-term bonus or incentive plans will
be eligible to receive PRO RATA awards for the portion of the fiscal year in
which the employees were actively at work in an eligible position.
(b) Except as set forth below, only employees who are employed by the
Company or a U.S. or Canadian subsidiary through the end of the applicable
fiscal year shall be eligible to receive awards for the fiscal year. Employees
who are hired during the fiscal year will participate in the Plan on a
time-weighted basis from their date of employment. Employees who die, become
Disabled or retire on or after their Early Retirement Date or Normal Retirement
Date, and employees whose employment is terminated on account of temporary
layoff, Job Elimination or Divestiture of the business unit in which the
employee was employed will be eligible to receive pro rata awards for the
portion of the fiscal year in which the employees were actively employed by the
Company or a subsidiary. For purposes of the Plan, an employee's employment will
be considered to be terminated on account of a Divestiture if the employee
ceases to be an employee of the Company and its subsidiaries as of the date of,
and as a direct result of, the Divestiture of the business unit in which the
employee was employed.
(c) Employees of foreign operations (other than employees of Canadian
subsidiaries) will not participate in the Plan.
4. CRITERIA FOR PROFIT SHARING AWARDS.
(a) Before the beginning of each fiscal year, the Committee shall establish
the performance goals for the year, by establishing in writing the levels of
pre-tax, pre-profit sharing profits and return on equity to be used for purposes
of Chart 1 for the year. The attached Chart 1 shall be used for the fiscal year
beginning in 1993 and each subsequent year until the Committee revises Chart 1
(using the same format and criteria) before the beginning of a fiscal year. The
performance goals for a fiscal year may not be modified after the year begins.
(b) For purposes of the Plan, pre-tax, pre-profit sharing profits and
return on equity shall be determined based on the audited financial statements
of the Company and its U.S. and Canadian subsidiaries and shall exclude
extraordinary charges and income.
(c) Each eligible employee will be assigned a responsibility level (RL)
equating to the employee's salary grade level according to Chart 2.
(d) Awards will be calculated for each eligible employee based on the
employee's Salary multiplied by the applicable bonus percentage. The bonus
percentage will be determined by the formula described below.
5. CALCULATION OF PROFIT SHARING POOL. The total amount designated to be
paid as profit sharing awards for the fiscal year (the Profit Sharing Pool)
shall be a percentage of the consolidated pre-tax, pre-profit sharing profits,
before extraordinary items, of the Company and its U.S. and Canadian
subsidiaries for the fiscal year, as determined by return on equity for the year
according to Chart 1. The Committee may reduce the total Profit Sharing Pool
before the end of the fiscal year if the Committee deems such a reduction to be
in the best interests of the Company.
6. CALCULATION OF INDIVIDUAL AWARDS. After the Profit Sharing Pool is
determined pursuant to Section 5, individual awards will be calculated for all
eligible employees as follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Profit
Individual Employee's Employee's RL Sharing Pool
Award = Salary x Salary-Weighted x Total Eligible
Average RL for Employees'
All Eligible Salaries
Employees
</TABLE>

D-2

<PAGE>
7. FINAL EMPLOYEE AWARD.
(a) An employee's profit sharing award for a fiscal year will be the award
computed for the employee pursuant to Section 6; provided, however, that an
employee's profit sharing award may not exceed $1,000,000 for any fiscal year.
If an employee's award would otherwise exceed this limit, the amount in excess
of this limit shall be added back to the Profit Sharing Pool and allocated to
the other eligible employees according to the formula described above.
(b) Before any profit sharing awards may be paid for a fiscal year, the
Committee shall certify that the performance goals set forth in Chart 1 and the
other requirements of the Plan have been satisfied for the fiscal year. No
payments shall be made unless and until the Committee makes this certification.
8. PAYMENT OF AWARDS.
(a) Awards shall be paid in cash as soon as is practicable following the
end of the fiscal year for which they are computed. All awards under the Plan
shall be paid subject to federal, state and local income and payroll tax
withholding.
(b) An employee shall receive no profit sharing award for a year if the
employee's employment with the Company and its subsidiaries terminates prior to
the last day of the fiscal year for any reason other than death, Disability,
retirement on or after the employee's Early Retirement Date or Normal Retirement
Date, temporary layoff, Job Elimination or a Divestiture of the business unit in
which the employee was employed. An employee who terminates employment for one
of the reasons described in the preceding sentence shall receive a pro rata
award pursuant to Section 3(b). An employee shall not forfeit an award if the
employee terminates employment after the end of the applicable fiscal year, but
prior to the distribution of the award for such year.
(c) If an employee dies and is subsequently entitled to receive an award
under the Plan, the award shall be paid to the personal representative of the
employee's estate.
9. ADMINISTRATION.
(a) The Plan shall be administered by the compensation committee of the
Board of Directors (the Committee), which shall be comprised solely of two or
more outside directors, as that term is defined for purposes of Code Section
162(m). If any member of the Committee fails to qualify as an outside director,
such person shall immediately cease to be a member of the Committee and shall
not take part in future Committee deliberations.
(b) The Committee may adopt rules and regulations for carrying out the
Plan, and the Committee may take such actions as it deems appropriate to ensure
that the Plan is administered in the best interests of the Company. The
Committee has the authority to construe and interpret the Plan, resolve any
ambiguities, and make determinations with respect to the eligibility for or
amount of benefits. The interpretation, construction and administration of the
Plan by the Committee shall be final and conclusive. The Committee may consult
with counsel, who may be counsel to the Company, and shall not incur any
liability for any action taken in good faith in reliance upon the advice of
counsel.
10. RIGHTS. Participation in the Plan and the right to receive bonuses
under the Plan shall not give an employee any proprietary interest in the
Company, any subsidiary or any of their assets. No trust fund shall be created
in connection with the Plan, and there shall be no required funding of amounts
that may become payable under the Plan. An employee shall for all purposes be a
general creditor of the Company. The interests of an employee cannot be
assigned, anticipated, sold, encumbered or pledged and shall not be subject to
the claims of his creditors. Nothing in the Plan shall confer upon any employee
the right to continue in the employ of the Company or any subsidiary or shall
interfere with or restrict in any way the right of the Company and its
subsidiaries to discharge an employee at any time for any reason whatsoever,
with or without cause.
11. SUCCESSORS. The Plan shall be binding on the employees and their
personal representatives. If the Company becomes a party to any merger,
consolidation, reorganization or other corporate transaction, the Plan shall
remain in full force and effect as an obligation of the Company or its successor
in interest.
12. AMENDMENT AND TERMINATION. The Board may amend or terminate the Plan at
any time as it deems appropriate; provided that (i) no amendment or termination
of the Plan after the end of a fiscal year may increase or decrease the total
profit sharing awards for the fiscal year just ended and (ii) to the extent
required to meet the requirements of Code Section 162(m) for performance-based
compensation, any amendment that makes a material change to the Plan must be
approved by the shareholders of the Company. The Board is specifically
authorized to amend the Plan as necessary or appropriate to comply with Code
Section 162(m) and regulations issued thereunder.
D-3

<PAGE>
13. INTERPRETATION. If any provision of the Plan would cause the Plan to
fail to meet the Code Section 162(m) requirements for performance-based
compensation, then that provision of the Plan shall be void and of no effect.
The Plan shall be interpreted according to the laws of the Commonwealth of
Virginia.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed this
24th day of February, 1994.
JAMES RIVER CORPORATION OF VIRGINIA
By: /S/ CLIFFORD A. CUTCHINS, IV
Senior Vice President, General Counsel,
Corporate Secretary
D-4

<PAGE>

Appendix (1) Exhibit D

Narrative description of graphic material pursuant to Rule 304(a) of Regulation
S-T

Chart 1: A graph showing the corporate return on equity on the x-axis
ranging from zero to thirty and the profit sharing pool as a percent of pretax
dollars on the y-axis ranging from zero to ten.

The curve starts at two on the x-axis and intersects at 8.5% pretax
dollars and 10% corporate return on equity and then flattens out at 9% net
pretax profit from 14% to 30% corporate return on equity.

Chart 2: A chart showing salary grades (SG), ranging from 20 to 74 and
the corresponding responsibility levels (RL) for each grade ranging from .50 to
6.35.

PROXY
JAMES RIVER CORPORATION OF VIRGINIA
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The undersigned hereby appoints Clifford A. Cutchins, IV, Stephen E. Hare, and
E. Lee Showalter (each with power to act alone and with power of substitution)
as proxies and hereby authorizes them to represent and vote, as directed, all
the shares of Common Stock of James River Corporation of Virginia held of
record by the undersigned on February 17, 1994, upon all matters properly
coming before the Annual Meeting of Shareholders to be held on April 28, 1994,
and any adjournment thereof.

If no direction is made, this proxy will be voted in accordance with the Board
of Directors' recommendations.
The Board of directors recommends a vote FOR Items 1, 2, 3, 4, 5, and 6

1. Election of Directors, Nominees: FOR ( ) WITHHELD ( )
Bemiss, Burgin, Clark, Comfort, Daniel, Gottwald, O'Neil, Piemont,
Whittemore, and Williams

FOR, except vote WITHHELD from the following nominees:

___________________________________________________________________________

2. Approval of Coopers & Lybrand as independent accountants
FOR ( ) AGAINST ( ) ABSTAIN ( )
3. Amend and restate the Stock Purchase Plan
FOR ( ) AGAINST ( ) ABSTAIN ( )
4. Amend and restate the 1987 Stock Option Plan
FOR ( ) AGAINST ( ) ABSTAIN ( )
5. Amend and restate the Deferred Stock Plan
FOR ( ) AGAINST ( ) ABSTAIN ( )
6. Adopt the 1993 Profit Sharing Plan for Salaried Employees
FOR ( ) AGAINST ( ) ABSTAIN ( )
(Continued and to be signed on the reverse.)

(Continued from other side)
The Board of Directors recommends a vote AGAINST Item 7.
7. Shareholder proposal - MacBride Principles
FOR ( ) AGAINST ( ) ABSTAIN ( )
8. In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the meeting.

Please sign exactly as name
appears at left. Executors,
trustees, etc. should so indicate
when signing. If a corporation,
sign in full corporate name by
authorized officer. If a
partnership, sign in partnership
name by authorized person.

__________________________________

Dated ______________________, 1994
Please date, sign and return this
Proxy in the enclosed envelope.