SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
Annual Report Pursuant to Section 15(d)
of the Securities Exchange Act of 1934
For the year ended December 31, 1998
Commission file number 1-7911
A. Full title of the plan and the address of the plan,
if different from that of the issuer named below:
JAMES RIVER CORPORATION OF VIRGINA
STOCKPLUS INVESTMENT PLAN
B. Name of issuer of the securities held pursuant to the
plan and the address of its principal executive office:
FORT JAMES CORPORATION
1650 Lake Cook Road, Deerfield, Illinois 60015-4753
JAMES RIVER CORPORATION OF VIRGINIA
STOCKPLUS INVESTMENT PLAN
INDEX TO FINANCIAL STATEMENTS, SUPPLEMENTAL SCHEDULES, AND EXHIBITS
__________
Page
----
Report of independent accountants 3
Financial statements:
Statements of net assets available for benefits, with fund
information as of December 31, 1998 and December 31, 1997 4
Statement of changes in net assets available for benefits,
with fund information for the year ended December 31, 1998 6
Notes to financial statements 7
Supplemental schedules:
Assets held for investment purposes as of December 31, 1998 14
Loans or fixed income obligations in default for the year
ended December 31, 1998 *
Leases in default or classified as uncollectible for the
year ended December 31, 1998 *
Nonexempt transactions for the year ended December 31, 1998 *
Reportable transactions for the year ended December 31, 1998 15
Exhibits to Annual Report on Form 11-K 16
Signatures 17
__________
* There were no such transactions during the period specified.
REPORT OF INDEPENDENT ACCOUNTANTS
To the Participants and Administrator
of the James River Corporation of
Virginia StockPlus Investment Plan:
In our opinion, the accompanying statements of net assets available for
benefits and the related statement of changes in net assets available for
benefits, present fairly, in all material respects, the net assets available for
benefits of the James River Corporation of Virginia StockPlus Investment Plan
(the "Plan") as of December 31, 1998 and 1997, and the changes in net assets
available for benefits for the year ended December 31, 1998 in conformity with
generally accepted accounting principles. These financial statements are the
responsibility of the Plan's management; our responsibility is to express an
opinion on these financial statements based on our audits. We conducted our
audits of these statements in accordance with generally accepted auditing
standards which require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed above.
Our audits were conducted for the purpose of forming an opinion on the
basic financial statements taken as a whole. The supplemental schedules of
assets held for investment purposes as of December 31, 1998, and reportable
transactions for the year ended December 31, 1998, are presented for the purpose
of additional analysis and are not a required part of the basic financial
statements but are supplementary information required by the Department of
Labor's Rules and Regulations for Reporting and Disclosure under the Employee
Retirement Income Security Act of 1974. The fund information in the statements
of net assets available for benefits and the statement of changes in net assets
available for benefits is presented for purposes of additional analysis rather
than to present the net assets available for benefits and changes in net assets
available for benefits of each fund. These supplemental schedules and fund
information are the responsibility of the Plan's management. These supplemental
schedules and fund information have been subjected to the auditing procedures
applied in the audits of the basic financial statements and, in our opinion, are
fairly stated in all material respects in relation to the basic financial
statements taken as a whole.
/s/ PRICEWATERHOUSECOOPERS LLP
Richmond, Virginia
May 21, 1999
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JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
December 31, 1998
Fort James Crown Fidelity IDS New Masterworks
Stock Vantage Balanced Dimensions S&P 500
Fund Stock Fund Fund Fund Stock Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Cash equivalents $ 6,853,702 $ 1,474,725 $ - $ - $ -
Investments, at fair value:
Fort James Common Stock
(historical cost: $202,243,813) 341,346,840* - - - -
Mutual funds
(historical cost: $142,754,605) - - 23,160,227 50,954,300* 46,387,499*
Loans receivable from participants - - - - -
- ------------------------------------------------------------------------------------------------------------------------------------
Total investments 341,346,840 - 23,160,227 50,954,300 46,387,499
- ------------------------------------------------------------------------------------------------------------------------------------
Receivables:
Accrued dividends - - 236,549 2,910,899 2,050,621
Accrued interest 9,266 5,821 - - -
- ------------------------------------------------------------------------------------------------------------------------------------
Total receivables 9,266 5,821 236,549 2,910,899 2,050,621
- ------------------------------------------------------------------------------------------------------------------------------------
Total assets 348,209,808 1,480,546 23,396,776 53,865,199 48,438,120
- ------------------------------------------------------------------------------------------------------------------------------------
Liabilities:
Due to broker for securities purchased - - 236,549 2,910,899 2,050,621
- ------------------------------------------------------------------------------------------------------------------------------------
Total liabilities - - 236,549 2,910,899 2,050,621
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits $ 348,209,808 $ 1,480,546 $ 23,160,227 $ 50,954,300 $46,387,499
====================================================================================================================================
*Indicates investments which represent 5% of more of net assets available for benefits
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
December 31, 1998
JPM Pierpont JPM Pierpont Loans
Bond Money Market to
Fund Fund Participants Total
- -----------------------------------------------------------------------------------------------------------------------------
Assets:
Cash equivalents $ - $ - $ - $ 8,328,427
Investments, at fair value:
Fort James Common Stock
(historical cost: $202,243,813) - - - 341,346,840
Mutual funds
(historical cost: $142,754,605) 11,999,326 34,365,032* - 166,866,384
Loans receivable from participants - - 18,070,818 18,070,818
- ------------------------------------------------------------------------------------------------------------------------------
Total investments 11,999,326 34,365,032 18,070,818 526,284,042
- ------------------------------------------------------------------------------------------------------------------------------
Receivables:
Accrued dividends 209,646 138,095 - 5,545,810
Accrued interest - - - 15,087
- ------------------------------------------------------------------------------------------------------------------------------
Total receivables 209,646 138,095 - 5,560,897
- ------------------------------------------------------------------------------------------------------------------------------
Total assets 12,208,972 34,503,127 18,070,818 540,173,366
- ------------------------------------------------------------------------------------------------------------------------------
Liabilities:
Due to broker for securities purchased 209,646 138,095 - 5,545,810
- ------------------------------------------------------------------------------------------------------------------------------
Total liabilities 209,646 138,095 - 5,545,810
- ------------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits $11,999,326 $34,365,032 $ 18,070,818 $ 534,627,556
==============================================================================================================================
*Indicates investments which represent 5% of more of net assets available for benefits
The accompanying notes are an integral part of these financial statements.
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
December 31, 1997
Fort James Crown Fidelity IDS New Masterworks
Stock Vantage Balanced Dimensions S&P 500
Fund Stock Fund Fund Fund Stock Fund
- -----------------------------------------------------------------------------------------------------------------------------------
Assets:
Cash equivalents $ 5,875,914 $ 55,791 $ - $ 24,748 $ -
Investments, at fair value:
Fort James Common Stock
(historical cost:$199,149) 337,523,546* - - - -
Crown Vantage Common Stock
(historical cost: $7,922,998) - 4,163,964 - - -
Mutual funds
(historical cost: $114,245,698) - - 16,610,190 41,810,403* 32,456,434*
Loans receivable from participants - - - - -
- -----------------------------------------------------------------------------------------------------------------------------------
Total investments 337,523,546 4,163,964 16,610,190 41,810,403 32,456,434
- -----------------------------------------------------------------------------------------------------------------------------------
Receivables:
Employer's contributions 204,843 - - - -
Accrued dividends - - 833,045 3,086,105 815,669
Accrued interest 14,933 285 - - -
- -----------------------------------------------------------------------------------------------------------------------------------
Total receivables 219,776 285 833,045 3,086,105 815,669
- -----------------------------------------------------------------------------------------------------------------------------------
Total assets 343,619,236 4,220,040 17,443,235 44,921,256 33,272,103
- -----------------------------------------------------------------------------------------------------------------------------------
Liabilities:
Fund transfers in transit (53,028) 151 (34,311) (314,787) (9,961)
Due to broker for securities purchased 2,599,974 - 867,355 3,379,988 801,508
Other - - 103,154 - 27,454
- -----------------------------------------------------------------------------------------------------------------------------------
Total liabilities 2,546,946 151 936,198 3,065,201 819,001
- -----------------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits $ 341,072,290 $ 4,219,889 $ 16,507,037 $ 41,856,055 $32,453,102
====================================================================================================================================
*Indicates investments which represent 5% of more of net assets available for benefits
The accompanying notes are an integral part of these financial statements.
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
STATEMENT OF NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
December 31, 1997
JPM Pierpont JPM Pierpont Loans
Bond Money Market to
Fund Fund Participants Total
- ------------------------------------------------------------------------------------------------------------------------------------
Assets:
Cash equivalents $ - $ - $ - $ 5,956,453
Investments, at fair value:
Fort James Common Stock
(historical cost: $199,149,449) - - - 337,523,546
Crown Vantage Common Stock
(historical cost: $7,922,998) - - - 4,163,964
Mutual funds
(historical cost: $114,245,698) 6,842,090 28,658,354* - 126,377,471
Loans receivable from participants - - 17,884,235 17,884,235
- ------------------------------------------------------------------------------------------------------------------------------------
Total investments 6,842,090 28,658,354 17,884,235 485,949,216
- ------------------------------------------------------------------------------------------------------------------------------------
Receivables:
Employer's contributions - - - 204,843
Accrued dividends 377,909 212,012 - 5,324,740
Accrued interest - - - 15,218
- ------------------------------------------------------------------------------------------------------------------------------------
Total receivables 377,909 212,012 - 5,544,801
- ------------------------------------------------------------------------------------------------------------------------------------
Total assets 7,219,999 28,870,366 17,884,235 497,450,470
- ------------------------------------------------------------------------------------------------------------------------------------
Liabilities:
Fund transfers in transit 333,556 78,380 - -
Due to broker for securities purchased 44,354 133,633 - 7,826,812
Other 15,805 188,794 - 335,207
- ------------------------------------------------------------------------------------------------------------------------------------
Total liabilities 393,715 400,807 - 8,162,019
- ------------------------------------------------------------------------------------------------------------------------------------
Net assets available for benefits $ 6,826,284 $28,469,559 $ 17,884,235 $ 489,288,451
====================================================================================================================================
*Indicates investments which represent 5% of more of net assets available for benefits
The accompanying notes are an integral part of these financial statements.
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
December 31, 1998
Fort James Crown Fidelity IDS New Masterworks
Stock Vantage Balanced Dimensions S&P 500
Fund Stock Fund Fund Fund Stock Fund
- ------------------------------------------------------------------------------------------------------------------------------------
Additions to net assets attributable to:
Investment income:
Cash dividends $ 5,540,275 $ - $ 2,141,075 $ 2,979,158 $ 2,586,752
Interest 134,888 696 1,628 2,286 2,345
Net appreciation (depreciation) in fair
value of investments 23,046,844 (2,089,947) 1,478,100 8,739,393 7,337,369
- ------------------------------------------------------------------------------------------------------------------------------------
Total investment income 28,722,007 (2,089,251) 3,620,803 11,720,837 9,926,466
- ------------------------------------------------------------------------------------------------------------------------------------
Contributions:
Participants' 14,446,545 - 1,826,625 5,730,931 4,726,464
Employer's 14,731,091 - 98,113 151,715 144,062
Rollover contributions 304,444 - 143,897 142,043 212,733
- ------------------------------------------------------------------------------------------------------------------------------------
Total contributions 29,482,080 - 2,068,635 6,024,689 5,083,259
- ------------------------------------------------------------------------------------------------------------------------------------
Total additions (deductions) 58,204,087 (2,089,251) 5,689,438 17,745,526 15,009,725
- ------------------------------------------------------------------------------------------------------------------------------------
Deductions from net assets attributable to:
Distributions to participants (29,949,580) (335,560) (2,244,473) (5,433,942) (4,759,265)
Administrative costs (37,694) 1,392 (3,140) (3,275) (4,003)
- ------------------------------------------------------------------------------------------------------------------------------------
Total deductions (29,987,274) (334,168) (2,247,613) (5,437,217) (4,763,268)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) prior
to interfund transfers 28,216,813 (2,423,419) 3,441,825 12,308,309 10,246,457
- ------------------------------------------------------------------------------------------------------------------------------------
Interfund transfers:
Transfers between investment funds (21,831,854) (283,000) 3,246,140 (3,419,576) 3,717,247
Loans to participants (5,447,866) (32,924) (363,372) (1,042,788) (1,028,460)
Loan repayments 6,200,425 - 328,597 1,252,300 999,153
- ------------------------------------------------------------------------------------------------------------------------------------
Total interfund transfers (21,079,295) (315,924) 3,211,365 (3,210,064) 3,687,940
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
available for benefits 7,137,518 (2,739,343) 6,653,190 9,098,245 13,934,397
Net assets available for benefits:
Beginning of year 341,072,290 4,219,889 16,507,037 41,856,055 32,453,102
- ------------------------------------------------------------------------------------------------------------------------------------
End of year $ 348,209,808 $ 1,480,546 $ 23,160,227 $ 50,954,300 $ 46,387,499
====================================================================================================================================
The accompanying notes are an integral part of these financial statements.
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
STATEMENT OF CHANGES IN NET ASSETS AVAILABLE FOR BENEFITS, WITH FUND INFORMATION
December 31, 1998
JPM Pierpont JPM Pierpont Loans
Bond Money Market to
Fund Fund Participants Total
- ------------------------------------------------------------------------------------------------------------------------------------
Additions to net assets attributable to:
Investment income:
Cash dividends $ 677,283 $ - $ - $ 13,924,543
Interest 973 1,693,002 1,700,458 3,536,276
Net appreciation (depreciation) in fair
value of investments (37,667) (151) - 38,473,941
- ------------------------------------------------------------------------------------------------------------------------------------
Total investment income 640,589 1,692,851 1,700,458 55,934,760
- ------------------------------------------------------------------------------------------------------------------------------------
Contributions:
Participants' 583,591 676,276 - 27,990,432
Employer's 41,107 50,331 - 15,216,419
Rollover contributions 15,508 112,097 - 930,722
- ------------------------------------------------------------------------------------------------------------------------------------
Total contributions 640,206 838,704 - 44,137,573
- ------------------------------------------------------------------------------------------------------------------------------------
Total additions (deductions) 1,280,795 2,531,555 1,700,458 100,072,333
- ------------------------------------------------------------------------------------------------------------------------------------
Deductions from net assets attributable to:
Distributions to participants (1,356,586) (9,752,195) (852,375) (54,683,976)
Administrative costs (25) (2,507) - (49,252)
- ------------------------------------------------------------------------------------------------------------------------------------
Total deductions (1,356,611) (9,754,702) (852,375) (54,733,228)
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) prior
to interfund transfers (75,816) (7,223,147) 848,083 45,339,105
- ------------------------------------------------------------------------------------------------------------------------------------
Interfund transfers:
Transfers between investment funds 5,284,114 13,286,929 - -
Loans to participants (170,693) (285,830) 8,371,933 -
Loan repayments 135,437 117,521 (9,033,433) -
- ------------------------------------------------------------------------------------------------------------------------------------
Total interfund transfers 5,248,858 13,118,620 (661,500) -
- ------------------------------------------------------------------------------------------------------------------------------------
Net increase (decrease) in net assets
available for benefits 5,173,042 5,895,473 186,583 45,339,105
Net assets available for benefits:
Beginning of year 6,826,284 28,469,559 17,884,235 489,288,451
- -----------------------------------------------------------------------------------------------------------------------------------
End of year $ 11,999,326 $ 34,365,032 $ 18,070,818 $ 534,627,556
====================================================================================================================================
The accompanying notes are an integral part of these financial statements.
JAMES RIVER CORPORATION OF VIRGINIA
STOCKPLUS INVESTMENT PLAN
NOTES TO FINANCIAL STATEMENTS
1. Description of the Plan: The following description of the James River
Corporation of Virginia StockPlus Investment Plan as amended and
restated effective September 1, 1996 (the "Plan"), provides only
general information on the Plan in effect as of December 31, 1998.
Participants should refer to the Plan agreement for a more complete
description of the Plan's provisions.
(a) General
The Plan is a profit sharing and 401(k) plan and, generally,
full-time employees of Fort James Corporation, formerly known as
James River Corporation of Virginia, ("Fort James," the
"Company," or the "Employer") and its domestic subsidiaries are
eligible to participate. Eligible employees who elect to
participate are referred to as "Participants". The Plan is
subject to the provisions of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA").
(b) Contributions
Participants may contribute up to 10% of their Annual Base
Pay, as defined in the Plan. Participants may transfer into the
Plan certain assets previously held under another tax-qualified
plan.
The Company makes matching contributions equal to 60% of
employee contributions up to 6% of Annual Base Pay. Participant
contributions in excess of 6% are not matched by the Company. The
Company may also make discretionary contributions to all eligible
Participants' accounts of up to 1% of Annual Base Pay. Both
Company matching and discretionary contributions are invested in
the Fort James Stock Fund.
Participant and Company contributions are subject to certain
statutory limitations.
(c) Participant Accounts
Each Participant account is credited with the Participant's
contributions and allocations of the Company's matching
contribution, the Company's discretionary contribution, and Plan
earnings. Allocations of contributions and investment earnings
are based on the Participant's contributions or account balances,
as provided by the Plan. Participant accounts are charged with an
allocation of administrative expenses including a quarterly fee
and certain transaction fees, as applicable. The net appreciation
(depreciation) in fair value of investments is also allocated
(charged) to the individual Participant accounts based on each
Participant's share of fund investments.
(d) Vesting
Each Participant is 100% vested in his Plan account. A
Participant's vested accounts may not be forfeited or refunded,
except to meet anti-discrimination requirements.
(e) Investment Options
The investment funds listed below have been established for
the investment of Plan assets. With the exception of the Fort
James Stock Fund and the Crown Vantage Stock Fund, each of the
funds is a mutual fund. A mutual fund consists of a variety of
investments selected by a professional manager to meet specific
objectives of return and risk.
Investment Fund Primary investments
------------------------------------------- ----------------------------------------------------------------
Fort James Stock Fund Fort James Common Stock
Crown Vantage Stock Fund Crown Vantage Common Stock and cash (this fund was liquidated
over the last 6 months of 1998)
Fidelity Balanced Fund Broadly diversified portfolio of high-yielding securities,
including common stocks, preferred stocks, and bonds
IDS New Dimensions Fund Common stocks of U.S. and foreign companies showing potential
for significant growth, preferred stocks, debt securities and
money market instruments
Masterworks S&P 500 Stock Fund Substantially the same percentages of common stocks as the
Standard & Poor's 500 Composite Stock Price Index
JPM Pierpont Bond Fund Fixed income securities, including U.S. government and agency
securities, corporate bonds, private placements, and
asset-backed and mortgage-backed securities
JPM Pierpont Money Market Fund High quality U.S. dollar denominated securities which have
effective maturities of not more than 13 months
=============================================================================================================
All Participant contributions may be transferred or
reinvested without restriction into any of the Plan's available
investment funds except the Crown Vantage Stock Fund. The
Company's matching and discretionary contributions are invested
in the Fort James Stock Fund and must remain in that fund until
the Participant reaches age 57.
(f) Participant Loans
A Participant is permitted to borrow up to the lesser of
one-half of his account balance or $50,000. The minimum loan is
$1,000. The maximum loan repayment term is five years, except for
loans to purchase a primary residence which have a maximum
repayment term of ten years. Loans bear interest at the prime
rate in effect on the first day of the month in which the loan
application is received plus 1%. All principal and interest
payments are credited to the investment funds from which the loan
was made. As of December 31, 1998 and 1997, there were 2,779 and
4,118 Participants, respectively, with outstanding loans.
(g) Distributions
If a Participant retires, dies, terminates employment, or
incurs a permanent disability, distributions of his account will
be made either in a lump sum payment or in monthly installments
over a period not to exceed the Participant's, or his
beneficiary's, life expectancy. The timing and form of
distributions are subject to certain minimum balance and age
restrictions as provided by the Plan.
Distributions from the Fort James Stock Fund are payable
either in whole shares of Fort James Common Stock, with the value
of fractional shares paid in cash, or entirely in cash.
Distributions from the remaining investment funds are payable in
cash.
(h) Withdrawals
The Plan provides for both hardship and non-hardship
withdrawals. With limited exceptions, after-tax and rollover
contributions may be withdrawn at any time. Before-tax
contributions may only be withdrawn without penalty at age 59 1/2
or in the event of retirement, death, disability, termination or
financial hardship. Financial hardship includes certain medical
expenses, purchase of a primary residence, tuition and related
education fees, or to prevent eviction from, or foreclosure on
the mortgage on, the primary residence. A Participant who reaches
age 59 1/2 may elect a one-time withdrawal of the entire balance
in his accounts.
(i) Administrative Expenses
Significant expenses of administering the Plan are borne by
the Company. These expenses are partially offset by quarterly
administrative, loan origination and maintenance, and withdrawal
and distribution transaction fees which are charged directly to
the Participants' accounts.
(j) Trustee and Recordkeeper
As of December 31, 1998, the assets of the Plan were held
under an Agreement of Trust with The Bank of New York, New York,
New York. State Street Global Advisors, Bloomington, Minnesota,
serves as recordkeeper for the Plan.
(k) Voting, Tender and Exercise of Other Rights
Each Participant is entitled to exercise voting rights
attributable to the shares allocated to his or her account and is
notified by the trustee prior to the time that such rights are to
be exercised. If timely instructions are not received from a
Participant, the trustee is entitled to vote, tender or exercise
similar rights with respect to shares of Fort James Common Stock
in the Participant's account as the trustee deems appropriate.
(l) Anti-Discrimination Requirements
The Plan is required to meet the anti-discrimination
requirements for highly compensated employees as set forth in
Section 401(k) of the Internal Revenue Code. For years in which
the Plan does not meet these requirements, a refund of
Participant contributions made by highly compensated employees
and the related Company matching contributions must be made
within two and one-half months after the close of the Plan year.
Refunds made to highly compensated employees are reflected as a
reduction of contributions and deposits on the statement of
changes in net assets available for benefits, with fund
information.
2. Summary of Significant Accounting Policies:
(a) Basis of Accounting
The financial statements of the Plan are prepared under the
accrual method of accounting, in accordance with generally
accepted accounting principles.
(b) Cash Equivalents
All contributions are initially invested in an interest-bearing
account pending their investment in the available investment
funds. Cash equivalents are stated at cost which approximates
market value.
(c) Investment Valuation
The investments in Fort James Common Stock and Crown Vantage
Common Stock are stated at market value, based on their closing
prices on the New York Stock Exchange Composite Tape on the last
trading day of the period. The number of shares and market prices
of Fort James Common Stock and Crown Vantage Common Stock held by
the Plan as of December 31, 1998 and 1997 were as follows:
1998 1997
--------------------------------------------------------------------------------------------
Shares Market Price Shares Market Price
---------------------------------------------------------------------------------------------
Fort James Common Stock 8,533,671 $40.00 8,824,145 $38.25
Crown Vantage Common Stock - - 594,852 7.00
=============================================================================================
Investments held in the Fidelity Balanced Fund, the
Masterworks S&P 500 Stock Fund, the JPM Pierpont Bond Fund and
the JPM Pierpont Money Market Fund are stated at the market value
of shares held by the Plan as of year end. Investments in the IDS
New Dimensions Fund are reported at market value or a reasonable
approximation thereof, except for securities maturing in 60 days
or less which are valued at amortized cost.
Loans to Participants are valued at the balance of amounts
due, plus accrued interest thereon, which approximates fair
value.
(d) Security Transactions and Related Investment Income
Security transactions are accounted for as of the trade date
and dividend income is recorded as of the dividend record date.
Interest income is recorded on the accrual basis. The cost of
securities sold is determined on an average cost basis.
(e) Realized Gains (Losses) on Common Stock
When a Participant borrows funds, makes a transfer between
funds, or receives a distribution, current cash contributions to
the Plan are used to provide the funds. For accounting purposes,
the average cost basis of shares which would have been sold by
the Plan to provide funds for the borrowing, transfer, or
distribution is deducted from the account of that Participant,
and the value of such shares is reallocated to the current
Participants' contributions. Accordingly, the Plan realizes a
gain or loss for the difference between the average cost basis of
shares which would have been sold and the fair value of such
shares on the distribution date.
(f) Net Appreciation (Depreciation) in Fair Value of Investments
The Plan presents in the statement of changes in net assets
available for benefits, with fund information, the net
appreciation (depreciation) in the fair value of its investments
which consists of the realized gains or losses and the unrealized
appreciation (depreciation) on those investments.
(g) Contributions and Deposits
Both Participant and Company contributions are recorded as
of the date the Participant contributions are withheld from the
Participant's compensation. All contributions are transferred to
the trustee within one week after Participant contributions are
withheld from compensation.
(h) Withdrawals and Distributions
Withdrawals and distributions from the Plan are recorded at
the fair value of the distributed investments, plus cash paid in
lieu of fractional shares where applicable. Withdrawals and
distributions are recorded when paid.
(i) Use of Estimates
Financial statements prepared in conformity with generally
accepted accounting principles require management to make
estimates and assumptions that significantly affect amounts
reported therein. Actual results could differ from those
estimates.
3. Plan Termination:
Although it has not expressed any intent to do so, the Company has the
right under the Plan to discontinue its contributions at any time and to
terminate the Plan subjectto the provisions of ERISA.
4. Separate Investment Fund Option Information:
The Fort James Stock Fund includes certain nonparticipant-directed
amounts. Nonparticipant-directed net assets available for benefits were
$178,569,142 as of December 31, 1998 and $181,181,671 as of December 31,
1997. Nonparticipant-directed activity for the year ended December 31, 1998
was as follows:
1998
---------------------------------------------------------------
Investment income $2,884,867
Net appreciation in fair value of investments 16,367,273
Contributions 13,047,879
Distributions 12,833,175
Assets transferred to other funds 101,814
===============================================================
5. Number of Participants
There were 18,287 Participants in the Plan as of December 31, 1998 and
18,884 Participants as of December 31, 1997. The number of Participants
investing in each of the Plan's funds as of those dates was as follows
(Participants may be included in more than one fund, as applicable):
1998 1997
----------------------------------------------------------
Fort James Stock Fund 14,610 15,418
Crown Vantage Stock Fund 8,721 10,199
Fidelity Balanced Fund 2,364 2,019
IDS New Dimensions Fund 4,057 3,884
Masterworks S&P 500 Stock Fund 3,881 3,246
JPM Pierpont Bond Fund 1,104 836
JPM Pierpont Money Market Fund 1,478 1,369
===========================================================
6. Units and Unit Values:
The following funds are accounted for on a unitized, daily-valued fund
basis. The number of units, which are calculated daily by the recordkeeper,
and unit values of net assets as of December 31, 1998, were:
Unit
Units Value
--------------------------------------------------------------------
Fort James Stock Fund 8,533,671 $40.00
Fidelity Balanced Fund 1,415,662 16.36
IDS New Dimensions Fund 1,766,487 28.84
Masterworks S&P 500 Stock Fund 1,884,905 24.61
JPM Pierpont Bond Fund 1,148,244 10.45
JPM Pierpont Money Market Fund 34,365,032 1.00
====================================================================
7. Tax Status:
The Plan is intended to be a qualified profit sharing plan under Sections
401(a) and 401(k) of the Internal Revenue Code, and as such is not subject
to federal income taxes. The Company has received a favorable determination
letter from the Internal Revenue Service, dated March 25, 1998, with
respect to the qualification of the Plan. The Plan administrator and the
Plan's tax counsel believe that the Plan is designed and operated in
accordance with the applicable requirements of the Internal Revenue Code.
8. Concentration of Credit Risk:
Financial instruments which potentially subject the Plan to concentrations
of credit risk consist of cash investments in excess of the Federal Deposit
Insurance Corporation insurance limit and investments in the various funds.
Credit and market risk associated with these instruments relates to the
performance of the underlying investments. The Plan has no formal policy
requiring collateral to support the financial instruments subject to credit
risk.
9. Subsequent Events
Effective January 1, 1999, the Plan was merged with the Fort Howard
Corporation Profit Sharing Retirement Plan and the Harmon Associates
Corporation Profit Sharing Plan and was renamed the Fort James 401(k)Plan
(the "Fort James Plan"). Under the terms of the Fort James Plan,
Participants may contribute up to 15% of their Annual Base Pay. Matching
contributions made by the Company vary by employee group, but generally are
equal to 60% of employee contributions up to 10% of Annual Base Pay for
salaried employees and 6% of Annual Base Pay for members of collective
bargaining units. Participant contributions in excess of these percentages
are not matched by the Company. Company discretionary contributions are no
longer permitted. Company contributions are made to the Fort James Common
Stock Fund, but may be transferred to other investment funds at any time.
Other significant provisions of the Fort James Plan are consistent with
those of the Plan.
The Fort James Plan provides for investments in the following core funds:
Investment Fund Objective Primary Investments
-------------------------------- -------------------------------------- --------------------------------------------
Money Market Fund Preserve capital Cash instruments with maturities of less
than one year such as U.S. Treasury
bills, commercial paper, and bankers'
acceptances
Fixed Income Fund Maximize income returns while Bonds and other types of debt
attempting to preserve capital instruments that typically pay income in
the form of interest
U.S. Equity Fund Maximize returns through both income Common stock issued by U.S.-based
and capital appreciation companies
Non U.S. Equity Fund Maximize returns through capital Common stock issued by companies based
appreciation in countries and regions outside the U.S.
Fort James Stock Fund Growth through capital appreciation Common stock of Fort James
without regard to diversification
================================ ====================================== ============================================
Participants may also elect to invest in any of following Combination Funds
which are premixed portfolios made up of selected proportions of the Fixed
Income Fund, the U.S. Equity Fund, and the Non-US Equity Fund.
Investment Fund Objective Core Investment Mix
-------------------------------- --------------------------------------------- -------------------------------------
Conservative Fund Generation of current income from 60% Fixed Income Fund
investment in fixed income securities and 30% U.S. Equity Fund
capital growth through investment in equity 10% Non-U.S. Equity Fund
securities of companies worldwide
Moderate Fund Capital growth through investment in equity 40% Fixed Income Fund
securities worldwide and the generation of 45% U.S. Equity Fund
current income from investment in fixed 15% Non-U.S. Equity Fund
income securities
Aggressive Fund Capital growth through investment in equity 20% Fixed Income Fund
securities worldwide 60% U.S. Equity Fund
20% Non-U.S. Equity Fund
================================ ============================================= =====================================
Also effective January 1, 1999, Northern Trust Retirement Consulting,
L.L.C. assumed the role of recordkeeper and Northern Trust Company was
appointed the trustee for the Fort James Plan.
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
ITEM 27(a) - SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES
December 31, 1998
Identity of Issue Description of Investment Cost Current Value
- ------------------------------------------------------------------------------------------------------------------------------------
Cash equivalents Interest rate - variable $ 8,328,427 $ 8,328,427
Fort James Corporation
Common Stock, $0.10 par value* 8,533,671 shares 202,243,813 341,346,840
Fidelity Balanced Fund Interest in mutual funds at $16.36 per unit 21,247,004 23,160,227
IDS New Dimensions Fund Interest in mutual funds at $28.84 per unit 39,197,871 50,954,300
Masterworks S&P 500 Stock Fund Interest in mutual funds at $24.61 per unit 35,961,017 46,387,499
JPM Pierpont Bond Fund Interest in mutual funds at $10.45 per unit 11,983,681 11,999,326
JPM Pierpont Money Market Fund Interest in mutual funds at $1.00 per unit 34,365,032 34,365,032
Participant loans * Interest rate - 6% to 11.5%; various maturity dates 18,070,818 18,070,818
====================================================================================================================================
* Party in interest to the Plan
JAMES RIVER CORPORATION OF VIRGINIA STOCKPLUS INVESTMENT PLAN
ITEM 27(d) - SCHEDULE OF REPORTABLE TRANSACTIONS
for the year ended December 31, 1998
Expense
Number of Incurred with Net Gain
Identify of Party Involved/Description of Asset Purchase Price Selling Price Transactions Transactions Cost (Loss)
- ------------------------------------------------------------------------------------------------------------------------------------
I. Single transactions in excess of 5%:
None
II. Series of transactions other than
securities in excess of 5%:
None
III. Series of transactions involving
securities in excess of 5%:
* Fort James Corporation Common Stock $28,008,363 36 $ 33,182
* Fort James Corporation Common Stock $ 38,626,118 60 $ 20,109,964 $ 18,516,154
Morgan Money Market Fund 24,175,344 142
Morgan Money Market Fund 18,468,667 116 18,468,667
IDS New Dimensions Fund 13,406,835 109
IDS New Dimensions Fund 13,004,228 141 10,434,657 2,569,571
Stage Coach S&P Fund 18,494,437 144
Stage Coach S&P Fund 11,900,867 110 9,473,733 2,427,134
Collective Short Term
Investment Fund 62,739,639 260
Collective Short Term
Investment Fund 60,992,735 274 60,992,735
IV. Security transaction with a party
involved in a single reportable transaction:
None
====================================================================================================================================
* Party in interest to the Plan
</TABLE>
EXHIBITS TO ANNUAL REPORT ON FORM 11-K
The exhibits listed below are filed as part of this Annual Report on Form
11-K. Each exhibit is listed according to the number assigned to it in the
Exhibit Table of Item 601 of Regulation S-K.
Exhibit
Number Description
- ------ -----------
4 Fort James 401(K) Plan, Amended and Restated Effective
January 1, 1999, filed herewith
23 Consent of Independent Accountants, filed herewith.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
members of the Committee which administers the Plan have duly caused this annual
report to be signed by the undersigned hereunto duly authorized.
JAMES RIVER CORPORATION OF VIRGINIA
STOCKPLUS INVESTMENT PLAN
June 24, 1999 /s/Clifford A. Cutchins, IV
Committee Member - Clifford A. Cutchins, IV
June 24, 1999 /s/Daniel J. Girvan
Committee Member - Daniel J. Girvan
June 24, 1999 /s/Ernst A. Haberli
Committee Member - Ernst A. Haberli
June 24, 1999 /s/R. Michael Lempke
Committee Member - R. Michael Lempke
June 24, 1999 /s/William A. Paterson
Committee Member - William A. Paterson
FORT JAMES 401(k) PLAN
Amended and Restated Effective January 1, 1999
iv
TABLE OF CONTENTS
Page
SECTION I - ESTABLISHMENT OF THE 401(k) PLAN...................................1
SECTION II - DEFINITIONS.......................................................2
2.1 Account......................................................2
2.2 Affiliated Company...........................................2
2.3 Before-Tax Contributions.....................................2
2.4 Beneficiary..................................................2
2.5 Board........................................................3
2.6 Canadian Employee............................................3
2.7 Company......................................................3
2.8 Company Stock................................................3
2.9 Company Stock Fund...........................................3
2.10 Compensation.................................................3
2.11 Discretionary Employer Contributions.........................3
2.12 Effective Date...............................................4
2.13 Employee.....................................................4
2.14 Employer or Employers........................................4
2.15 ERISA........................................................4
2.16 Highly Compensated Employee..................................4
2.17 Hours of Service.............................................4
2.18 Insider......................................................5
2.19 Internal Revenue Code........................................5
2.20 J&S Account..................................................5
2.21 Leave of Absence.............................................5
2.22 Matching Contributions.......................................5
2.23 Non-Union Participant........................................5
2.24 Participant..................................................5
2.25 Permanent Disability.........................................6
2.26 Plan.........................................................6
2.27 Plan Administrator...........................................6
2.28 Plan Year....................................................6
2.29 Prior Plan...................................................6
2.30 Qualified Joint and Survivor Annuity.........................6
2.31 Qualified Pre-Retirement Survivor Annuity....................6
2.32 Rule 16b-3...................................................6
2.33 Service......................................................7
2.34 Single Life Annuity..........................................7
2.35 Stock Purchase Plan..........................................7
2.36 Taxable Compensation.........................................7
2.37 Trust Agreement..............................................8
2.38 Trustee......................................................8
2.39 Trust Fund...................................................8
2.40 Union Participant............................................8
2.41 Valuation Date...............................................8
SECTION III - PARTICIPATION....................................................9
3.1 Participation in General.....................................9
3.2 Participation in the Before-Tax
Contributions Portion of the Plan............................9
3.3 Duration of Participation; Reemployment......................9
SECTION IV - CONTRIBUTIONS....................................................10
4.1 Before-Tax Contributions....................................10
4.2 Matching Contributions......................................10
4.3 Elections as to Before-Tax Contributions; Changes...........11
4.4 Discretionary Employer Contribution.........................12
4.5 Time and Manner of Payment of Contributions.................12
SECTION V - ACCOUNTS..........................................................13
5.1 Participants' Accounts......................................13
5.2 Allocation of Contributions.................................13
5.3 Annual Addition and Benefit Limitations.....................13
5.4 Anti-Discrimination Test for Before-Tax Contributions.......15
5.5 Anti-Discrimination Test for Matching Contributions.........17
5.6 Distribution of Excess Contributions........................18
5.7 Correction of Error.........................................19
SECTION VI - VESTING AND DISTRIBUTION OF ACCOUNTS.............................20
6.1 Vested Interest.............................................20
6.2 Distribution Upon Termination of Employment.................20
6.3 Death.......................................................20
6.4 Form and Time of Payment....................................20
6.5 Benefits to Minors and Incompetents.........................24
6.6 Location of Missing Participants............................24
6.7 No Guarantee of Values......................................25
6.8 Eligible Rollover Distributions.............................25
SECTION VII - WITHDRAWALS AND LOANS...........................................27
7.1 Hardship Withdrawals........................................27
7.2 Withdrawals Other Than For Hardship.........................29
7.3 Loans.......................................................29
7.4 Insiders....................................................32
SECTION VIII - TRUST ARRANGEMENTS.............................................33
8.1 Appointment of Trustee......................................33
8.2 Appointment of Managers....................................33
SECTION IX - INVESTMENT OF ACCOUNTS...........................................34
9.1 Investment Funds............................................34
9.2 Investment of Accounts......................................34
9.3 Directed Investments........................................35
9.4 Limitations on Directed Investments.........................36
9.5 Application to Beneficiaries
and Alternate Payees........................................37
9.6 Order of Withdrawals and Loans
from the Investment Funds...................................37
9.7 Voting, Tender and Exercise of Similar
Rights with Respect to Company Stock........................37
9.8 Management of the Company Stock Fund........................38
9.9 Allocation of Income........................................38
9.10 Accounts Not Directed.......................................39
SECTION X - GENERAL PROVISIONS................................................40
10.1 Nonalienation of Benefits...................................40
10.2 Merger or Consolidation.....................................40
10.3 No Contract of Employment...................................40
10.4 Non-Reversion...............................................40
10.5 Construction and Severability...............................41
10.6 Delegation of Authority.....................................41
10.7 Changes in Capital Structure................................41
10.8 Receipt of Rollovers and Trustee-to-Trustee Transfers.......41
10.9 Gender and Number...........................................42
10.10 Plan Merger.................................................42
SECTION XI - PLAN ADMINISTRATION..............................................43
11.1 Plan Administrator..........................................43
11.2 Responsibilities............................................43
11.3 Delegation of Duties........................................44
11.4 Expenses....................................................44
11.5 Compensation................................................44
11.6 Facility of Payment.........................................44
11.7 Benefit Claims Procedure....................................45
11.8 Domestic Relations Orders...................................45
11.9 Persons With Qualified Military Service.....................47
SECTION XII - AMENDMENT OF PLAN...............................................48
12.1 Reserved Power to Modify, Suspend or Terminate..............48
12.2 Distribution on Termination of Plan.........................48
SECTION XIII - ADOPTION OF PLAN BY AFFILIATED COMPANIES.......................49
13.1 Adoption of the Plan........................................49
13.2 Withdrawal..................................................49
13.3 Sale of Employer or Division................................49
SECTION XIV - TOP HEAVY.......................................................50
14.1 Top Heavy...................................................50
14.2 Minimum Allocation..........................................51
14.3 Compensation Limitation.....................................51
14.4 Benefit and Contribution Limitations........................51
APPENDIX A Merger of the James River II Salaried Employees Retirement
Savings Plan into the StockPlus Investment Plan
APPENDIX B Merger of the Specialty Papers Company Profit Sharing Plan
into the StockPlus Investment Plan
APPENDIX C Merger of the James River - Ridgway Corporation Profit
Sharing and Incentive Savings Plan into the StockPlus
Investment Plan
APPENDIX D Merger of the Diamond Occidental Forest Inc. Employee
Savings Plan into the StockPlus Investment Plan
APPENDIX E Merger of the Paper Art Company, Inc. 401(k) Profit Sharing
Plan into the StockPlus Investment Plan
APPENDIX F Merger of the Paper Art Company, Inc. 401(k) Plan for
Bargaining Unit Employees into the StockPlus Investment Plan
APPENDIX G Merger of the Rampart Packaging, Inc. Salary Deferral Plan
into the StockPlus Investment Plan
APPENDIX H Provisions Relating to Former Employees of Benchmark
Holdings, Inc. and WinCup Holdings, Inc.
APPENDIX I Effective Dates for Certain Plan Provisions
APPENDIX J Special Provisions Relating to Ashland Mill Employees
APPENDIX K Merger of the Fort Howard Corporation Profit Sharing
Retirement Plan into the Plan
APPENDIX L Merger of the Harmon Assoc., Corp. Profit Sharing Plan
into the Plan
APPENDIX M Matching Contributions Under Section 4.2(a)(ii)
APPENDIX N Qualified Joint and Survivor Annuity Rules
APPENDIX O Special Provisions for Canadian Employees
SECTION I
ESTABLISHMENT OF THE 401(k) PLAN
Fort James Corporation (the "Company") maintains the Fort James 401(k) Plan
(the "Plan") for the benefit of its eligible Employees and the eligible
Employees of its Affiliated Companies. The Plan was formerly known as the James
River Corporation of Virginia StockPlus Investment Plan.
The Company restated the Plan as of September 1, 1996. The Company further
amended the Plan effective as of July 1, 1997. The Plan is amended and restated,
effective as of January 1, 1999, to reflect certain design changes and changes
in applicable law.
The Plan is intended to be a qualified profit sharing plan with a cash or
deferred arrangement pursuant to Sections 401(a) and 401(k) of the Internal
Revenue Code. The Plan is also intended to qualify as a Section 404(c) plan for
the purposes of the Employee Retirement Income Security Act of 1974 ("ERISA"),
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 Before-Tax Contributions means contributions made by an Employer
pursuant to Section 4.1.
2.4 Beneficiary means the person or entity who is to receive any benefits
payable from the Plan on account of a Participant's death, as follows:
(a) 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.
(b) 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 for this Plan with the Plan
Administrator. If a plan is merged into this Plan, Beneficiary designations made
with respect to the merged plan shall apply to Participants' Accounts under this
Plan. A participant may designate more than one Beneficiary to receive a portion
of the Participant's Account, subject to the requirements of paragraph (a) if
any non-spouse beneficiary is designated.
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.
2.5 Board means the Board of Directors of the Company.
2.6 Canadian Employee means an Employee of James River-Marathon, Ltd.,
Canada Cup, Inc., or any other Canadian Employer. Special Plan provisions that
apply to Canadian Employees are contained in Appendix O.
2.7 Company means Fort James Corporation and any successor by merger
or otherwise.
2.8 Company Stock means common stock issued by the Company.
2.9 Company Stock Fund means the investment fund maintained under the Plan
for the investment of Participants' Accounts in shares of Company Stock.
2.10 Compensation means total wages paid or otherwise payable in cash to an
Employee by his Employer during a Plan Year for personal services
(including overtime and shift differential pay), but excluding payments under
any severance, salary continuation or layoff program, accrued vacation pay,
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 as follows:
Compensation shall be determined without regard to any reduction in
remuneration resulting from an election to have Before-Tax Contributions made on
an Employee's behalf pursuant to the Plan.
In the case of an Employee who is employed by two or more Employers, the
Employee's aggregate Compensation from all Employers shall be deemed to be his
Compensation. The total amount of annual Compensation taken into account under
the Plan for an Employee may not exceed $150,000, as adjusted for cost of living
increases 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 includible in gross income (as reported on Form W-2), increased by
the Employee's Before-Tax Contributions, elective contributions under a
cafeteria plan and elective contributions under other arrangements required to
be included under Section 414(s) of the Internal Revenue Code and applicable
Treasury Regulations.
2.11 Discretionary Employer Contributions means contributions made by an
Employer pursuant to Section 4.4.
2.12 Effective Date means, for the amended and restated Plan, January 1,
1999 (except as otherwise indicated in Appendix I or elsewhere in the Plan).
The original effective date of the Plan was June 29, 1973.
2.13 Employee means a person employed by an Employer, other than as an
independent contractor or as a "leased employee" within the meaning of
Section 414(n) of the Internal Revenue Code. Notwithstanding the foregoing,
persons employed by Ecosource Corp. and West Mason, Inc., and persons who are
not United States residents, shall not be considered "Employees" for purposes of
the Plan.
2.14 Employer or Employers means the Company and any Affiliated Company that
adopts the Plan with the consent of the Board.
2.15 ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time, and the regulations issued thereunder.
2.16 Highly Compensated Employee means an Employee who:
(a) Was a 5% owner of the Employer at any time during the Plan Year or the
preceding Plan Year, or
(b) Received Taxable Compensation from the Employer in excess of $80,000
during the preceding Plan Year and, to the extent elected by the Plan
Administrator pursuant to applicable Treasury Regulations, was in the top 20% of
Employees when ranked on the basis of Taxable Compensation paid during such
preceding Plan Year. The $80,000 limit shall be adjusted pursuant to Sections
414(q) and 415(d) of the Internal Revenue Code.
The determination of Highly Compensated Employees for a Plan Year shall be
made in accordance with Section 414(q) of the Internal Revenue Code and
applicable Treasury Regulations.
2.17 Hours of Service means:
(a) Each hour for which an Employee is directly or indirectly paid, or
entitled to payment, by an Employer or an Affiliated Company for the
performance of duties;
(b) Each hour (up to a maximum of 501 hours) for which an Employee is
directly or indirectly paid, or entitled to payment, by an Employer or an
Affiliated Company for reasons (such as vacation, sickness or disability) o
ther than for the performance of duties; and
(c) Each hour for which back pay, irrespective of mitigation of damages,
has been either awarded or agreed to by an Employer or an Affiliated Company.
To the extent required by Federal law, if an Employee leaves the employ of
the Employer to enter the military service of the United States, and, upon his
discharge from such military service, is reemployed by the Employer at a time
when his reemployment rights are protected by Federal law, the Employee shall
receive credit for purposes of determining his Hours of Service for the period
during which he would have performed work for the Employer but for his military
service pursuant to the Uniformed Services Employment and Reemployment Rights
Act ("USERRA").
Hours of Service under subsection (a) shall be credited to the 12-month
period during which the Employee's duties were performed. Hours of Service under
subsections (b) and (c) shall be credited to the 12-month period to which the
payments relate. Hours of Service for periods of time during which no duties
were performed shall be credited in accordance with Section 2530.200b-2(b) and
(c) of the Department of Labor regulations. In any case in which employment
records do not accurately reflect hours worked, Hours of Service shall be
credited at the rate of 45 Hours of Service per calendar week.
2.18 Insider means a person designated as an insider for purposes of Section
16 of the Securities Exchange Act of 1934.
2.19 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.
2.20 J&S Account means the portion of a Participant's Account that is
transferred from another plan pursuant to an Appendix and is subject to the
joint and survivor annuity rules described in Appendix N.
2.21 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.
2.22 Matching Contributions means contributions made by an Employer
pursuant to Section 4.2.
2.23 Non-Union Participant means an Employee who participates in the Plan
and who is not a Union Participant.
2.24 Participant means any person who is an eligible Employee and who
participates in the Plan pursuant to the provisions of Section III. For
purposes of Section 7.2 (regarding withdrawals other than for hardship), Section
IX (regarding investment of Accounts) and Section 10.8 (regarding rollovers and
trustee-to-trustee transfers), the term Participant shall include any former
Employee with a vested Account under the Plan. Unless otherwise indicated, the
term "Participant" includes both Union Participants and Non-Union Participants.
2.25 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 State (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.
2.26 Plan means the Fort James 401(k) Plan, as amended from time to time.
2.27 Plan Administrator means the committee responsible for administering
the Plan, as described in Section XI.
2.28 Plan Year means the calendar year.
2.29 Prior Plan means the James River Corporation of Virginia StockPlus
Investment Plan, as in effect before the Effective Date of this amendment and
restatement of the Plan.
2.30 Qualified Joint and Survivor Annuity means an immediate annuity that
can be purchased with a Participant's J&S Account and that is payable for
the lifetime of the Participant, with a survivor annuity for the lifetime of the
Participant's surviving spouse that is equal to 50% of the amount of the annuity
that is payable during the joint lifetimes of the Participant and his spouse.
Payment of a Qualified Joint and Survivor Annuity shall terminate with the
monthly payment preceding the death of the last to survive of the Participant
and his spouse.
2.31 Qualified Pre-Retirement Survivor Annuity means an annuity that can be
purchased with a deceased Participant's J&S Account, the present value of
which is equal to the Participant's J&S Account on the date of his death. The
Qualified Pre-Retirement Survivor Annuity is payable to the Participant's
surviving spouse for the spouse's life.
2.32 Rule 16b-3 means Rule 16b-3 of the Securities Exchange Act of 1934,
including any corresponding subsequent rule or amendments thereto.
2.33 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.
2.34 Single Life Annuity means an annuity payable monthly for the life of a
Participant from the Participant's J&S Account.
2.35 Stock Purchase Plan means the James River Corporation of Virginia Stock
Purchase Plan, a predecessor plan to the Prior Plan and to this Plan.
2.36 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 includible 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
includible in the gross income of the Employee).
Taxable Compensation includes any elective deferral described in Section
402(g)(3) of the Internal Revenue Code (including Before-Tax Contributions), and
any amount contributed or deferred by the Employer at the election of the
Employee and which is not includible in the Employee's gross income pursuant to
a cafeteria plan under Section 125 of the Internal Revenue Code or an
arrangement described in Section 457 of the Internal Revenue Code. The amount of
annual Taxable Compensation taken into account under the Plan for an Employee
may not exceed $150,000, as adjusted for cost of living increases pursuant to
Sections 401(a)(17) and 415(d) of the Internal Revenue Code.
2.37 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.
2.38 Trustee means The Northern Trust Company, 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.
2.39 Trust Fund means the assets held by the Trustee under the Trust
Agreement.
2.40 Union Participant means an Employee who participates in the Plan and
whose employment is covered by a collective bargaining agreement between a
collective bargaining agent and the Employer.
2.41 Valuation Date means each business day on which both the New York
Stock Exchange is open for trading and the Trustee's recordkeeping operations
are open.
SECTION III
PARTICIPATION
3.1 Participation in General.
(a) Each Employee who was a Participant in the Prior Plan immediately
before the Effective Date shall be a Participant in the Plan as of the
Effective Date.
(b) Each Employee, other than a benefits ineligible Employee, who is not a
Participant pursuant to subsection (a) above shall become a Participant as
of the later of: (i) the date on which the Employee commences employment with
the Employer; or (ii) the Effective Date. A benefits ineligible Employee is an
Employee who is employed in a position for which there is no eligibility for
benefits and who is not expected to be credited with 1,000 or more Hours of
Service during a 12-month period. In the event that a benefits ineligible
Employee is credited with 1,000 or more Hours of Service during a 12-month
period, he shall become a Participant as of the first day of the month
immediately following the end of the 12-month period. The computation period for
this purpose shall be the 12 consecutive month period beginning with the
Employee's date of hire and ending on the first anniversary of such date, and
subsequent 12-month periods beginning on an anniversary of the Employee's date
of hire.
(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 Participation in the Before-Tax Contributions Portion of the Plan.
(a) Participation in the Before-Tax Contributions portion of the Plan shall
be voluntary. An eligible Employee may elect to participate in the
Before-Tax Contributions portion of the Plan by making an enrollment election in
such manner and at such time as the Plan Administrator shall designate. An
enrollment election must be made before the date as of which the Employee's
election to become a Participant in the Before-Tax Contributions portion of the
Plan will be effective. An Employee's payroll deductions shall begin within 30
days after the Plan Administrator receives the Employee's enrollment election.
(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 Before-Tax Contributions portion of 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 as an eligible Employee under
Section 3.1, he shall be eligible to be a Participant upon his reemployment.
SECTION IV
CONTRIBUTIONS
4.1 Before-Tax Contributions. A Participant who is eligible to participate
in the Plan may elect to have Before-Tax Contributions made on his behalf
by making a salary reduction election in accordance with procedures established
by the Plan Administrator. Pursuant to the election, the Participant's Employer
will reduce the Participant's Compensation by a designated percentage and
contribute that designated percentage to the Plan for the benefit of the
Participant. The designated percentage may be from 1% to 15% of the
Participant's Compensation per payroll period, 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 Before-Tax Contributions that may be made on
behalf of a Participant during a calendar year is $10,000, 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 according to one of the following
subparagraphs as determined by an Employer:
(i) Each Employer shall make a Matching Contribution each payroll period
for its Participants equal to sixty percent (60%) of the total Before-Tax
Contributions that its Participants have contributed to the Plan for that
payroll period. However, the Employer shall make no Matching Contribution with
respect to the portion of a Participant's Before-Tax Contributions that exceed
ten percent (10%) of the Participant's Compensation; or
(ii) Each Employer shall make a Matching Contribution each payroll period
for its Participants equal to sixty-percent (60%) of the total Before-Tax
Contributions that its Participants have contributed to the Plan for that
payroll period. However, the Employer shall make no Matching Contribution with
respect to the portion of a Participant's Before-Tax Contributions that exceed
six percent (6%) of the Participant's Compensation. The groups of Participants
entitled to receive Matching Contributions pursuant to this Section 4.2(a)(ii)
are listed in Appendix M from time to time.
(b) Matching Contributions shall be made with respect to a Participant's
Before-Tax Contributions, regardless of whether the Participant ceases to
be an Employee before the Matching Contribution is made and without regard to
whether such Before-Tax Contributions are invested in the Company Stock Fund.
(c) If, as of the end of the Plan Year, a Participant has not received the
maximum amount of Matching Contribution to which he or she is entitled to
receive for the Plan Year pursuant to subsection (a) above, the Plan
Administrator may, in its discretion, make an additional allocation for the
Participant equal to the difference between the amount of Matching Contributions
already allocated to the Participant's Before-Tax Matching Contributions Account
for the Plan Year, and the maximum amount of the Matching Contribution that he
or she is entitled to receive pursuant to subsection (a), subject to the limits
of Section 5.5. Such allocations shall be made in a nondiscriminatory manner.
4.3 Elections as to Before-Tax Contributions; Changes.
(a) A Participant may elect to have Before-Tax Contributions made on his
behalf, to change the contribution percentage prospectively, or to request
a suspension or resumption of contributions by making an election 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) Notwithstanding anything in the Plan to the contrary, each Non-Union
Participant shall be deemed at the time he or she first becomes eligible to
participate in the Plan to have elected to make Before-Tax Contributions equal
to 2% of his or her Compensation, effective for the payroll period during which
his or her participation in the Plan commences. The deemed election may be
changed or revoked by the Participant as of any subsequent payroll period in
accordance with procedures established by the Plan Administrator pursuant to
Section 4.1. Each Non-Union Participant for whom a deemed Before-Tax
Contribution election has remained in place without change during the Plan Year
shall be notified by the Plan Administrator at the end of the Plan Year of the
Before-Tax Contribution percentage described above and his or her right to
change the percentage.
(c) A Participant's right to have Before-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.
(d) If a Participant's Before-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).
(e) 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 Discretionary Employer Contribution. The Employers may, in their
discretion, make Discretionary Employer Contributions to some or all
Participants who are not Highly-Compensated Employees. The amount of the
Discretionary Employer Contribution shall be a uniform percentage of the
Compensation paid for the Plan Year to those Participants who are determined to
be eligible for the contribution. In no event may a Discretionary Employer
Contribution be made to a Participant who is or was a Highly Compensated
Employee at any time during the Plan Year for which the contribution is made.
4.5 Time and Manner of Payment of Contributions.
(a) Before-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 (other than those described in Section
4.2(c)) shall be paid to the Trustee at least monthly. Matching Contributions
may be made in cash or in Company Stock, or in any combination thereof.
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) Before-Tax Contributions Account, to which shall be credited Before-Tax
Contributions made under the Prior Plan and this Plan, and the Participant's
Salary Reduction Account under the Stock Purchase Plan.
(b) After-Tax Contributions Account, to which shall be credited the
Participant's Non-Tax-Deferred Account under the Stock Purchase Plan.
(c) Before-Tax Matching Contributions Account, to which shall be credited
Matching Contributions made under the Prior Plan and this Plan, and the
Participant's Salary Reduction Matching Account under the Stock Purchase Plan.
(d) After-Tax Matching Contributions Account, to which shall be credited
the Participant's Matching Account (other than the Participant's Salary
Reduction Matching Account) under the Stock Purchase Plan.
(e) Discretionary Employer Contributions Account, to which shall be
credited Discretionary Employer Contributions made under the Prior Plan and
this Plan.
(f) Rollover Account, to which shall be credited the Participant's
Rollover Account under the Stock Purchase Plan and the Prior Plan, and assets
transferred from other plans that are not credited to one of the foregoing
Accounts pursuant to one of the Appendices.
The Plan Administrator may combine, eliminate or add to the foregoing
Accounts at such time as the Plan Administrator deems appropriate. Contributions
made under a plan that is merged into this Plan, or whose assets are otherwise
transferred to this Plan, may be added to the foregoing Accounts according to an
applicable Appendix. Earnings on each Account shall be allocated to that Account
pursuant to the provisions of Section IX.
5.2 Allocation of Contributions. The Plan Administrator shall allocate to
the Accounts of each Participant the contributions made for the
Participant's benefit as soon as practicable following the date on which such
contributions are determined.
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 Plan Year
shall be the limitation year used to determine whether the requirements of this
Section have been satisfied. The $30,000 amount referenced above shall be
adjusted in accordance with Section 415(d) of the Internal Revenue Code.
(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) Before-Tax Contributions, Matching
Contributions, Discretionary Employer 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 Before-Tax Contributions
that are distributed by April 15 following the calendar year in which the
contributions were made, pursuant to Section 5.6.
(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, for Plan Years ending on or before
December 31, 1999, 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
(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 Before-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 Before-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 Before-Tax Contributions shall be accomplished by: (i) requiring
each Highly Compensated Employee to reduce (or eliminate) the Before-Tax
Contributions to be made on his behalf for the Plan Year; (ii) returning
Before-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 Discretionary Employer Contributions or other fully vested
Employer contributions for Participants who are not Highly Compensated
Employees, and who elected to have Before-Tax Contributions made for the Plan
Year, which shall be administered as an additional Before-Tax Contribution; 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 for the Plan Year is not more
than the Actual Deferral Percentage of all other eligible
Employees for the immediately preceding Plan Year,
multiplied by 1.25; or
(ii) The excess of the Actual Deferral Percentage of the
Highly Compensated Employees for the Plan Year over that of
the other eligible Employees for the immediately preceding
Plan Year is not more than 2 percentage points, and the
Actual Deferral Percentage of the Highly Compensated
Employees for the Plan Year is not more than the Actual
Deferral Percentage of all other eligible Employees for the
immediately preceding Plan Year, multiplied by 2.
Notwithstanding the foregoing, the Plan Administrator may elect to use the
current Plan Year's Actual Deferral Percentage for eligible Employees who are
not Highly Compensated Employees, instead of their Actual Deferral Percentage
for the immediately preceding Plan Year, in applying the tests described above.
Such election shall be made in accordance with Section 401(k)(3)(A) of the
Internal Revenue Code and applicable Treasury Regulations and rulings.
(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 Before-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.
(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 Section
401(a) of the Internal Revenue Code, 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
Before-Tax Contributions. If a Highly Compensated Employee participates in more
than one plan of the Company, all Before-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 Section 5.4 and 5.5 in
accordance with Internal Revenue Service rulings and Treasury Regulations in
effect from time to time.
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 for the Plan Year is not more
than the Contribution Percentage of all other eligible
Employees for the immediately preceding Plan Year,
multiplied by 1.25; or
(ii) The excess of the Contribution Percentage of the Highly
Compensated Employees for the Plan Year over that of the
other eligible Employees for the immediately preceding Plan
Year is not more than 2 percentage points, and the
Contribution Percentage of the Highly Compensated Employees
for the Plan Year is not more than the Contribution
Percentage of all other eligible Employees for the
immediately preceding Plan Year, multiplied by 2.
Notwithstanding the foregoing, the Plan Administrator may elect to use the
current Plan Year's Contribution Percentage for eligible Employees who are not
Highly Compensated Employees, instead of their Contribution Percentage for the
immediately preceding Plan Year, in applying the tests described above. Such
election shall be made in accordance with Section 401(m)(2)(A) of the Internal
Revenue Code and applicable Treasury Regulations and rulings.
(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.
Before-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)(ii) shall
be used only to the extent permitted by applicable Treasury regulations.
(e) If the Company maintains more than one plan qualified under Sectio
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 Highly Compensated
Employee under all such plans will be aggregated for purposes of performing the
anti-discrimination test described in subsection (b) above.
(f) 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, the Plan
Administrator shall reduce the Before-Tax Contributions or the Matching
Contributions of those Highly Compensated Employees who participate in the Plan
so that the limit is not exceeded. Such reductions shall be calculated in
accordance with the methods prescribed in Sections 401(k)(8)(C) and 401(m)(6)(C)
of the Internal Revenue Code, respectively. The amount by which each Highly
Compensated Employee's Actual Deferral Percentage or Contribution Percentage is
reduced shall be treated as an excess contribution under Section 5.7(b) or
5.7(c), as applicable. 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 (f). 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 Distribution of Excess Contributions.
(a) If a Participant's Before-Tax Contributions exceed Section 402(g) of
the Internal Revenue Code limit described in Section 4.1 for a calendar
year, the amount of Before-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
Before-Tax Contributions were made.
(b) If Before-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 Before-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 Before-Tax Contributions relate. In determining the amount of the
distributions required under this Section 5.6(b), the Plan Administrator shall
use the leveling method described in Section 401(k)(8)(C) of the Internal
Revenue Code and applicable Treasury Regulations thereunder, or any other method
allowed by the Internal Revenue Service.
(c) If Matching Contributions of Highly Compensated Employees are required
to be reduced as a result of the antidiscrimination test described in
Section 5.5, the Plan Administrator shall reduce such contributions by either:
(i) forfeiting the contributions and applying them to reduce future Matching
Contributions; or (ii) distributing the contributions to 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 forfeitures or distributions
required under this Section 5.6(c), the Plan Administrator shall use the
leveling method described in Section 401(m)(6)(C) of the Internal Revenue Code
and applicable Treasury Regulations thereunder, 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 Before-Tax
Contributions in excess of dollar limitation described in Section 4.1 and
Matching Contributions attributable to excess Before-Tax Contributions under
Section 5.4 may be forfeited and applied to reduce future Matching
Contributions. Such Matching Contributions may be forfeited regardless whether
they are otherwise vested under the Plan.
5.7 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.
SECTION VI
VESTING AND DISTRIBUTION OF ACCOUNTS
6.1 Vested Interest. Each Participant shall have a fully vested interest
at all times in his Accounts, except as otherwise provided in an applicabl
Appendix.
6.2 Distribution Upon Termination of Employment. Subject to Section
6.4(g), a Participant shall become entitled to a distribution of his
Accounts when he terminates employment with the Employer and Affiliated
Companies or if he incurs a Permanent Disability. A Participant's Accounts shall
be valued as soon as practicable following receipt by the Plan Administrator of
all information necessary to process the distribution. All the Participant's
outstanding loans described in Section 7.3 shall become due and payable upon the
Participant's termination of employment.
6.3 Death. If a Participant dies before his Accounts have been
distributed, his Accounts shall be paid to his Beneficiary. The
Participant's Accounts shall be valued as soon as practicable following receipt
by the Plan Administrator of all information necessary to process the
distribution. All the Participant's outstanding loans described in Section 7.3
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, or if a Participant dies or incurs a
Permanent Disability before his Accounts have begun to be distributed, the
Participant's Accounts 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 Accounts may be paid to the Participant (or
Beneficiary) in a lump sum payment equal to all or a portion
of the Participant's Accounts;
(ii) The Accounts may be paid to the Participant (or
Beneficiary) in monthly, quarterly or annual installments.
In the case of annuity payments made pursuant to Appendix L
or N, the Accounts may be paid to the Participant (or
Beneficiary) in any annuity form that is considered
actuarially equivalent and is offered by the insurance
company chosen by the Company to provide the annuity
payments. However, in no event may the installments or
annuity payments continue over a term extending beyond the
life expectancies of the Participant and his Beneficiary.
If the Participant dies before the completion of
installments, any balance of the Accounts 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
Accounts 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.
(iii) Notwithstanding the above, a Participant (or
Beneficiary) may elect to receive a lump sum payment equal
to all or a portion of the Participant's remaining Accounts
after the start of such Participant (or Beneficiary)
receiving installment payments pursuant to subparagraph (ii)
above. The remaining payments will be adjusted according to
the amount remaining in the Accounts after such election.
Moreover, a Participant (or Beneficiary) may elect to change
the amount or timing of installment payments after the start
of such Participant (or Beneficiary) receiving installment
payments pursuant to subparagraph (ii) above. The remaining
payments will be adjusted according to the amount remaining
in the Accounts after such election.
(iv) If the Participant designated more than one Beneficiary
to receive his Account, each Beneficiary may select the form
of payment as described above.
(b) If the value of a Participant's vested interest in the Participant's
Accounts does not exceed $5,000 ($3,500 prior to January 1, 1998) upon
termination from employment, the Plan Administrator may direct the trustee to
cause the entire amount in the Participant's vested Accounts to be paid to such
Participant in a single lump sum without such Participant's consent.
(c) In order for benefits to be paid or for installment payments to be
changed to a Participant (or Beneficiary), the Participant (or Beneficiary)
must request payment, subject to the terms of the Plan, in the manner prescribed
by the Plan Administrator. If the Participant is not a Canadian Employee, has
not reached the date on which his or her Account is required to be distributed
pursuant to subsection (f) and his or her Account balance exceeds $5,000 ($3,500
prior to January 1, 1998) at the time of termination from employment, the
Participant must consent to the distribution. The Participant's consent must be
given in writing on a form designated by the Plan Administrator. To the extent
required by law, such form, and a notice which explains the optional forms of
benefit available to the Participant and his right to defer the receipt of his
benefits under subsection (d) below, will be provided to the Participant no less
than 30 days and no more than 90 days before the date on which distribution is
to commence. A distribution may commence less than 30 days after the date on
which the notice described above is given to the Participant, provided that:
(i) The Plan Administrator informs the Participant that the
Participant has a right to a period of at least 30 days
after receiving the notice to consider the decision as to
whether to elect a distribution (and, if applicable, a
particular distribution option), and
(ii) The Participant, after receiving the notice,
affirmatively elects a distribution.
Payments shall be made or shall begin to be made as soon as
is administratively feasible after the Participant or
Beneficiary requests the payment as described above. If
additional allocations are to be made to the Participant's
Account after the distribution date, the additional
allocations will be distributed as soon as is
administratively feasible after they are made.
(d) A Participant who is not a Canadian Employee and whose Account balance
exceeds $5,000 ($3,500 prior to January 1, 1998) at the time of termination
from employment may postpone commencement of his benefit to the date on which
his or her Account is required to be distributed pursuant to subsection (f). A
Participant who has postponed commencement of his benefit may later elect to
begin receiving his benefit at an earlier date than the date described in
subsection (f).
(e) The following rules shall apply to a deceased Participant who was not
a Canadian Employee and whose Account balance exceeds $5,000 ($3,500 prior
to January 1, 1998) at the time of termination from employment:
(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.
(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) a Beneficiary who is an individual
or a trust, 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). However, for purposes of the preceding
sentence, if the Participant's Beneficiary is his Spouse,
the Spouse may defer the commencement of benefits until the
first day of the month following the month in which the
Participant would have attained age 70.
(f) Notwithstanding the foregoing, distributions from the Plan must begin
by not later than:
(i) the April 1 of the calendar year following the calendar
year in which Participant reaches age 70-1/2, for
Participants who are 5% owners of the Company or an
Affiliated Company (as defined in Section 416 of the
Internal Revenue Code), and
(ii) the April 1 of the calendar year following the latest
of: (A) the calendar year in which the Participant reaches
age 70-1/2; or (B) the calendar year in which the
Participant retires, for Participants who are not 5% owners
of the Company or an Affiliated Company.
If a Participant is still in the 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
Section 401(a)(9) of the Internal Revenue Code. 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. The
provisions of Section 6.4(f) shall be administered in accordance with applicable
Treasury Regulations and Internal Revenue Service rulings and other releases.
(g) 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 soon as practicable following receipt by the Plan Administrator of all
information necessary to process the distribution. 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 soon as practicable following receipt by the Plan Administrator of all
information necessary to process the distribution.
(h) Notwithstanding the foregoing, a Participant's Before-Tax Contributions
Account, Before-Tax Matching Contributions Account and Discretionary Employer
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
regulations), or qualifies for a withdrawal under Section
7.1 or 7.2(c);
(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(h) 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 in a manner consistent with the requirements
of Section 401(k) of the Internal Revenue Code and the Treasury Regulations
thereunder.
(i) If a Participant or Beneficiary elects a distribution from the Plan and
for any reason part of the amount elected cannot be distributed (for
example, because a portion of the Account is invested in a fund from which a
distribution cannot be made for reasons over which the Plan Administrator and
Trustee have no control), a partial distribution attributable to the available
portion of the elected amount may be made.
(j) Notwithstanding the foregoing, if a Participant or Beneficiary is
entitled to receive a distribution from a J&S Account, the joint and
survivor annuity rules of Appendix N shall apply to the distribution,
notwithstanding anything in the Plan to the contrary.
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 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, except in the case of
termination of the plan. 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 allocable 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; the portion of any
distribution that is not includible in gross income
(determined without regard to the exclusion for net
unrealized appreciation with respect to employer
securities); and any withdrawal of Before-Tax Contributions
on account of financial hardship pursuant to Section 7.1.
(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.
SECTION VII
WITHDRAWALS AND LOANS
7.1 Hardship Withdrawals.
(a) A Participant who is an Employee, other than a Canadian Employee, may
request that the Plan Administrator authorize a hardship withdrawal to be made
from his Accounts 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 Before-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 Before-Tax Contributions for the year in which the withdrawal
is made.
(d) Hardship withdrawals may be made as of the end of any month (or more
frequently, if the Plan Administrator so determines). 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.
(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 Accounts 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 Accounts as
of the 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 balance of the Participant's Accounts exceeds the unpaid balance of
any outstanding loans described in Section 7.3. The Plan Administrator shall
designate the order in which hardship withdrawals shall be made from
Participants' Accounts.
(f) Notwithstanding the foregoing, a Participant may not withdraw from his
Before-Tax Contributions Account any earnings credited to that Account on
or after January 1, 1989. If Matching Contributions or Discretionary Employer
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, Discretionary
Employer 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(f).
7.2 Withdrawals Other Than For Hardship.
(a) Subject to subsection (b) 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, After-Tax Matching Contributions Account, and
Rollover Account as of any Valuation Date. A withdrawal may not exceed the
limits described in subsection (b) below.
(b) 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's Accounts shall be valued as soon
as practicable following 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 Accounts, reduced
by the unpaid balance of any outstanding loans described in Section 7.3, exceeds
the unpaid balance of any outstanding loans described in Section 7.3.
(c) A Participant who is not a Canadian Employee and who has attained age
59-1/2 may request one or more withdrawals of all or a specified part of
the entire balance in his Accounts as of any Valuation Date (including amounts
credited to his Before-Tax Contributions Account). If a Participant who has
attained age 59-1/2 requests a withdrawal of the entire balance in his Accounts,
any future withdrawals shall be subject to the limitations imposed under
subsection (b) above. Any loan described in Section 7.3 that is not promptly
repaid shall be considered in default and treated as a taxable distribution to
the Participant. To make a withdrawal pursuant to this subsection (c), a
Participant must submit an application in such form and at such time as the Plan
Administrator shall designate.
(d) Withdrawals made pursuant to this Section 7.2 shall be paid in a single
lump sum payment, in the same manner as distributions are made pursuant to
Section 6.4(f).
7.3 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 Accounts. 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) The Plan Administrator shall implement procedures for the authorization
of Plan loans, using uniform and nondiscriminatory standards. The Plan
Administrator shall take into consideration the terms of any existing Qualified
Domestic Relations Order in determining whether to authorize a loan.
(b) The loan may only be made from a Participant's vested interest in his
Accounts. 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 Accounts. The amount of loans outstanding to a Participant
at any time, aggregated with the outstanding balance of all other loans to the
Participant from this Plan and 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) One-half of the Participant's Accounts under the Plan.
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 Accounts shall be determined
as soon as practicable following the Plan Administrator's approval of the loan.
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 Accounts, 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.
(e) Loans shall be made in cash. When a loan is made to a Participant,
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 a rate not less than the prime
rate in effect as of the first day of the month in which the loan
application is received by the Plan Administrator (as reported in The Wall
Street Journal or such other source or sources as the Plan Administrator deems
appropriate), plus one percent. The Plan Administrator shall determine the
interest rate in a manner that is consistent with applicable 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.
(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. The Participant's loan repayment obligations
will be suspended for a period of not longer than one year while the Participant
is on a leave of absence (either with or without pay), provided that the
outstanding loan balance is repaid by the end of the original term of the loan
or such later date as may be permitted under Section (g) above.
(j) If the entire balance in a Participant's Accounts 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 have no more than one loan outstanding at any time.
The Participant must repay any outstanding loan from the Plan before
receiving a new loan from the Plan.
(n) When a Participant takes a leave of absence to perform service in the
uniformed services as defined in Section 414(u)(4) of the Internal Revenue
Code, the Participant's loan repayment obligation will be suspended for a period
of not longer than one year while the Participant is on such military leave of
absence. The Plan Administrator, on a uniform basis, may suspend loan repayments
beyond such one year period. However, under no circumstances shall the
suspension extend beyond the Participant's period of the military leave.
7.4 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 or other applicable laws relating to Company Stock
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.
8.2 Appointment of Managers. The Plan Administrator may appoint
investment managers to manage part or all of the trust assets, as provided
in the Trust Agreement. An investment manager must qualify as an investment
manager under Section 3(38) of ERISA.
SECTION IX
INVESTMENT OF ACCOUNTS
9.1 Investment Funds.
(a) The following investment funds shall be established for purposes
of the Plan:
(i) 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.
(ii) Other Investment Funds. The Plan Administrator shall designate other
investment funds from time to time for investment of Participants'
Accounts. The Plan Administrator shall select the investment funds in
accordance with Section 404(c) of ERISA and the regulations thereunder.
Special investment funds with respect to assets of plans that are merged
into the Plan may be designated pursuant to an applicable Appendix.
(b) Plan assets may be invested in a short term investment fund or in any
other manner deemed appropriate by the Trustee or the Plan Administrator,
pending investment in the appropriate investment fund.
(c) The Plan Administrator may impose upon any investment fund such
restrictions as may be necessary or appropriate. For example, the Plan
Administrator may restrict transfers to or from an investment fund, and the Plan
Administrator may limit the amount of a Participant's Account that may be
transferred to or from an investment fund during a specified period of time.
9.2 Investment of Accounts. Prior to January 1, 1997, the Plan
Administrator restricted investment of the Participants Before-Tax
Contributions Account, Before-Tax Matching Contributions Account, and the
Discretionary Employer Contributions Account to the Company Stock Fund until the
Participant reached 57 years of age. At age 57, the Participant was permitted to
direct the investment of all of his Accounts into any of the investment funds
offered pursuant to Section 9.1.
Effective January 1, 1997, the Plan Administrator permitted the
Participant to reallocate the Participant's Before-Tax Contributions
Account into any of the investment funds offered pursuant to Section 9.1.
Moreover, the Participant was permitted to direct future contributions to the
Participant's Before-Tax Contributions Account into any of the investment funds
offered pursuant to Section 9.1. The Plan Administrator maintained the
restriction that required the Before-Tax Matching Contributions Account and the
Discretionary Employer Contributions Account to be invested in the Company Stock
Fund until the Participant reached 57 years of age. At age 57, the Participant
was permitted to direct the investment of all of his Accounts into any of the
investment funds offered pursuant to Section 9.1.
Effective January 1, 1999, future contributions to a Participant's
Before-Tax Matching Contributions Account and Discretionary Employer
Contributions Account will be made to the Company Stock Fund. However, a
Participant may transfer any portion of such Accounts to another investment fund
offered pursuant to Section 9.1, regardless of age. Each Participant 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.
9.3 Directed Investments. With respect to those portions of a
Participant's Accounts 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) A Participant may make investment directions in such form and at such
time as the Plan Administrator shall designate. Investment directions shall
specify the investment funds in which the Participant's Accounts are to be
invested. Investment directions may be made as of each Valuation Date in whole
percentages. Investment directions shall be submitted to such person as the Plan
Administrator designates to implement Participants' directions. A Participant's
investment directions shall be implemented as soon as is administratively
feasible, consistent with applicable law and the Trustee's fiduciary
responsibilities. An investment direction shall continue to apply until a
subsequent direction is properly submitted. A Participant's Accounts may be
charged for the reasonable expenses of carrying out investment directions.
(b) To the extent required by applicable law or regulations, 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 9.3;
(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) To the extent required by applicable law or regulations, 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;
(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.
9.4 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 Section 406 of ERISA
or Section 4975 of the Internal Revenue Code;
(b) Generate taxable income to the Plan or jeopardize its tax qualified s
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.
9.5 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.
9.6 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:
(1) any amounts to be allocated have been allocated; and (2) any transfers
between the investment funds or withdrawals have been made. Loan repayments
shall be credited to the investment funds in which the Participant's Account is
invested, consistent with the requirements of Section 9.2. 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 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 order in which
withdrawals and loans from the investment funds are to be made and credited.
9.7 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 allocable 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) The Trustee shall vote, tender or exercise similar rights with respect
to Company Stock for which timely instructions are received according to
the Participants' instructions. The Trustee shall vote, tender, or exercise
similar rights with respect to shares of Company Stock for which timely
instructions are not received from Participants in such manner as the Trustee
deems appropriate.
(c) The Plan Administrator (or its agent) 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.
9.8 Management of the Company Stock Fund.
(a) The Plan Administrator shall implement and follow procedures sufficient
to safeguard the confidentiality of information relating to the purchase,
holding, and sale of Company Stock by Participants, except to the extent
necessary to comply with Federal or state laws not preempted by ERISA.
(b) If required by law, the Plan Administrator shall appoint an independent
fiduciary (within the meaning of applicable Department of Labor
regulations) to perform certain functions with respect to the Company Stock Fund
if the Plan Administrator determines that 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.
(c) The Trustee shall manage the Company Stock Fund in a manner consistent
with ERISA, the Internal Revenue Code and applicable securities laws.
Consistent with these laws, the Trustee shall implement appropriate procedures,
restrictions and limitations with respect to the purchase and sale of Company
Stock. If the Trustee is not able to execute fully Participants' investment
directions at a particular time, the Trustee shall execute the instructions to
the extent possible, in a pro rata manner.
9.9 Allocation of Income. All net income that is earned on
investments in an investment fund described in Section 9.1 shall be
reinvested by the Trustee in that investment fund. As of each Valuation Date,
the Trustee shall determine the current fair market value of each investment
fund. As of each Valuation Date, before making adjustments for withdrawals,
loans and transfers, the Plan Administrator shall adjust the Accounts invested
in that investment fund to reflect the value of the investment fund as of that
date. The adjustments shall be based on each Participant's Account balance
invested in the investment fund as of the preceding Valuation Date. The
outstanding balance of a Participant's loans described in Section 7.3 will not
be included as part of his Account balance for purposes of allocations under
this Section 9.9.
9.10 Accounts Not Directed. If a Participant fails to designate the
investment funds in which his Account is to be invested, all amounts
contributed to the Account on the Participant's behalf shall be invested by the
Plan Administrator as it deems appropriate. Investments pursuant to this Section
9.10 shall be made in a uniform and nondiscriminatory manner as to all
Participants.
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.
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) Subject to rules established by the Plan Administrator, the Trustee may
receive a transfer of assets previously held under another tax-qualified
plan (including a plan maintained by an Employer) for the benefit of a person
who is eligible to participate or who is a Participant in this Plan. Unless the
Plan Administrator determines otherwise, assets that are subject to the joint
and survivor annuity requirements of Section 417 of the Internal Revenue Code
may not be transferred to this Plan. Transferred 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
that consists solely of assets that were formerly held in a tax-qualified plan.
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 the Participant's Rollover Account (unless an applicable
Appendix provides otherwise).
(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.
10.10 Plan Merger. The Plan Administrator may direct that one or more other
defined contribution plans maintained by an Employer be merged into this
Plan. In the event of such a merger, the Plan Administrator shall designate the
Accounts to which each Participant's accounts from the prior plan shall be
allocated. Attached to the Plan are one or more Appendices that explain how the
accounts of the prior plans are to be administered under this Plan.
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) 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, entities 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;
(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 9.8(b).
The Plan Administrator shall have the power to modify by administrative
practice the time periods set forth in the Plan for making elections and
applications with respect to withdrawals, distributions, Plan loans, investment
directions, and other matters. 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 an
payment in its behalf, or to execute or deliver any instrument.
11.4 Expenses. All expenses 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, agent 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
Employer. Participants' Accounts may be charged for part or all of the expenses
of administration of the Plan, consistent with applicable law.
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:
(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 Section 414(p)
of the Internal Revenue Code.
(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) A Qualified Domestic Relations Order shall not give an Alternate Payee
any greater rights with respect to distributions, investments or other
matters than a Participant would have with respect to the Account. An Alternate
Payee's interest in a Participant's Account shall be distributed as soon as
administratively practicable following the date on which the Plan Administrator
determines the Alternate Payee's interest, unless the applicable Qualified
Domestic Relations Order provides otherwise; in which case the Alternate Payee
may elect to receive a distribution of his or her interest in the Account at any
time after such interest has been finally determined. Distributions shall be
made to Alternate Payees in accordance with the Plan, the Qualified Domestic
Relations Order and applicable law.
(f) 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 Section 414(p) of the
Internal Revenue Code.
11.9 Persons With Qualified Military Service. Notwithstanding any provision
of this Plan to the contrary, contributions, benefits, service credit and
loans with respect to qualified military service will be administered in
accordance with the Uniformed Services Employment and Reemployment Rights Act of
1994 ("USERRA") and Section 414(u) of the Internal Revenue Code.
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 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:
(a) "Top Heavy" plans are one or more plans that are qualified under
Section 401(a) of the Internal Revenue Code 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 Section 416(g) of the Internal
Revenue Code. 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
Section 401 of the Internal Revenue Code, 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 Section 401(a)(4) or 410 of the Internal Revenue Code 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 Section 416(g) of the Internal Revenue Code. 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 Section 415(b)(1)(A) of the Internal Revenue Code
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 5.3 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 $160,000 (or an adjusted amount
pursuant to Sections 401(a)(17) and 415(d) of the Internal Revenue Code). If the
Participant is a 5% owner or is one of the 10 highly compensated employees, as
defined in Section 414(q) of the Internal Revenue Code, 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:
(a) The sum of the present value of accrued benefits and account balances
of Key Employees under plans aggregated pursuant to Section 14.1(a) 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 14.2 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
28th day of June, 1999.
FORT JAMES CORPORATION
By /s/ Daniel Girvan
APPENDIX A
MERGER OF THE
JAMES RIVER II
SALARIED EMPLOYEES RETIREMENT SAVINGS PLAN
INTO THE STOCKPLUS INVESTMENT PLAN
The James River II Salaried Employees Retirement Savings Plan
(the "JRII Plan") was merged into the StockPlus Investment Plan as of July
1, 1994. Contributions to the JRII Plan were frozen in 1986. The following
special provisions relate to accounts transferred from the JRII Plan:
1. All accounts in the JRII Plan immediately before July 1, 1994 were
transferred to this Plan as of July 1, 1994 and shall be administered
according to the provisions of this Plan, subject to the special provisions
described below. Employees and former employees who had accounts in the JRII
Plan immediately before July 1, 1994 are referred to as "Former JRII Employees."
2. A Former JRII Employee's accounts under the JRII Plan will be held in
the following Accounts for the Former JRII Employee under this Plan:
(a) The JRII Plan account attributable to before-tax contributions shall
be held in the Before-Tax Contributions Account.
(b) The JRII Plan account attributable to after-tax contributions shall
be held in the After-Tax Contributions Account.
(c) The JRII Plan account attributable to matching contributions shall be
held in the Before-Tax Matching Contributions Account.
(d) The JRII Plan account attributable to rollover contributions shall be
held in the Rollover Account.
3. Each Former JRII Employee's Accounts shall be invested according to
the terms of this Plan.
4. Each Former JRII Employee's Accounts shall be held and administered
according to the terms of this Plan, subject to the
following rules:
(a) If a Former JRII Employee has a loan from the JRII Plan that is
outstanding as of July 1, 1994, the loan will remain outstanding under the
merged Plan, until paid or otherwise satisfied according to its terms. In other
respects, Plan loans will be governed by the provisions of Section 7.3 of this
Plan.
(b) As of the end of any Plan Year quarter, a Former JRII Employee who has
attained age 59-1/2 may elect to withdraw part or all of the Former JRII
Employee's interest in the portion of his Before-Tax Contributions Account that
is attributable to before-tax contributions made under the JRII Plan. The
withdrawal shall be made pursuant to the administrative procedures described in
Section 7.2.
(c) If a Former JRII Employee received a withdrawal from the JRII Plan
before April 1, 1981 and repays to the Plan in a lump sum an amount equal
to the portion of the withdrawal that was attributable to employee contributions
allocated to the basic after-tax account, the Employer shall restore to the
Participant's Account the amount of the forfeiture, without adjustments. The
amount of the repayment shall be credited to the Former JRII Employee's Matching
Contributions Account. The repayment must be made before the date on which the
Participant completes a period of severance of at least 12 consecutive calendar
months ending before January 1, 1985 or a period of severance of 60 months or
more ending on or after January 1, 1985.
5. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect
to the accounts transferred from the JRII Plan. The Plan shall be administered
consistent with the requirements of Section 411(d)(6) of the Internal Revenue
Code and the Treasury regulations thereunder.
APPENDIX B
MERGER OF THE SPECIALTY PAPERS COMPANY
PROFIT SHARING PLAN INTO THE
STOCKPLUS INVESTMENT PLAN
The Specialty Papers Company Profit Sharing Plan (the "Specialty Plan"
was merged into the StockPlus Investment Plan on or around April 1, 1995
(for purposes of this Appendix, the "Merger Date"). Contributions to the
Specialty Plan were frozen in 1987. The following special provisions relate to
accounts transferred from the Specialty Plan:
1. All accounts in the Specialty Plan immediately before the Merger Date
were transferred to this Plan as of the Merger Date and shall be
administered according to the provisions of this Plan, subject to the special
provisions described below. Employees and former employees who had accounts in
the Specialty Plan immediately before the Merger Date are referred to as "Former
Specialty Employees.
2. A Former Specialty Employee's accounts under the Specialty Plan will be
held in the following Accounts for the Former Specialty Employee
under this Plan:
(a) The Specialty Plan account attributable to before-tax contributions
shall be held in the Before-Tax Contributions Account.
(b) The Specialty Plan account attributable to after-tax contributions
shall be held in the After-Tax Contributions Account.
(c) The Specialty Plan account attributable to employer contributions
shall be held in the Before-Tax Matching Contributions Account.
3. Each Former Specialty Employee's Accounts shall be invested according
to the terms of this Plan.
4. Each Former Specialty Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
(a) An amount equal to the balance in a Former Specialty Employee's
Specialty Plan accounts as of the Merger Date shall be considered a J&S
Account and shall be subject to the joint and survivor annuity optional
form of benefit provisions of Appendix N of this Plan. Plan earnings after
the Merger Date on amounts transferred from the Specialty Plan shall not be
considered part of the J&S Account and shall not be subject to the joint
and survivor annuity optional form of benefit rules.
(b) As of the end of any Plan Year quarter, a Former Specialty Employee who
has attained age 59-1/2 may elect to withdraw part or all of the Former
Specialty Employee's interest in the portion of his Before-Tax
Contributions Account that is attributable to before-tax contributions made
under the Specialty Plan. The withdrawal shall be made pursuant to the
administrative procedures described in Section 7.2.
(c) If a Former Specialty Employee has a loan from the Specialty Plan that
is outstanding as of the Merger Date, the loan will remain outstanding
under the merged Plan until paid or otherwise satisfied according to its
terms. In other respects, Plan loans will be governed by the provisions of
Section 7.3 of this Plan.
5. The provisions of this Plan are intended to comply with the requirements
of Section 411(d)(6) of the Internal Revenue Code with respect to the
accounts transferred from the Specialty Plan. The Plan shall be administered
consistent with the requirements of Section 411(d)(6) of the Internal Revenue
Code and the Treasury regulations thereunder.
APPENDIX C
MERGER OF THE JAMES RIVER - RIDGWAY CORPORATION
PROFIT SHARING AND INCENTIVE SAVINGS PLAN INTO THE
STOCKPLUS INVESTMENT PLAN
The James River - Ridgway Corporation Profit Sharing and Incentive
Savings Plan (the "Ridgway Plan") was merged into the StockPlus Investment
Plan on or around April 1, 1995 (for purposes of this Appendix, the "Merger
Date"). Contributions to the Ridgway Plan were frozen in 1988. The following
special provisions relate to accounts transferred from the Ridgway Plan:
1. All accounts in the Ridgway Plan immediately before the Merger
Date were transferred to this Plan as of the Merger Date and shall be
administered according to the provisions of this Plan, subject to the special
provisions described below. Employees and former employees who had accounts in
the Ridgway Plan immediately before the Merger Date are referred to as "Former
Ridgway Employees."
2. A Former Ridgway Employee's accounts under the Ridgway Plan
will be held in the following Accounts for the Former Ridgway Employee
under this Plan:
(a) The Ridgway Plan account attributable to before-tax
contributions shall be held in the Before-Tax Contributions Account.
(b) The Ridgway Plan account attributable to employer
contributions shall be held in the Before-Tax Matching Contributions
Account.
(c) The Ridgway Plan account attributable to rollover
contributions shall be held in the Rollover Account.
3. Each Former Ridgway Employee's Accounts shall be invested
according to the terms of this Plan.
4. Each Former Ridgway Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
(d) As of the end of any Plan Year quarter, a Former
Ridgway Employee who has attained age 59-1/2 may elect to withdraw part or
all of the Former Ridgway Employee's interest in the portion of his
Before-Tax Contributions Account that is attributable to before-tax
contributions made under the Ridgway Plan. The withdrawal shall be made
pursuant to the administrative procedures described in Section 7.2.
(e) If a Former Ridgway Employee has a loan from the
Ridgway Plan that is outstanding as of the Merger Date, the loan will
remain outstanding under the merged Plan until paid or otherwise satisfied
according to its terms. In other respects, Plan loans will be governed by
the provisions of Section 7.3 of this Plan.
5. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect
to the accounts transferred from the Ridgway Plan. The Plan shall be
administered consistent with the requirements of Section 411(d)(6) of the
Internal Revenue Code and the Treasury regulations thereunder.
APPENDIX D
MERGER OF THE DIAMOND OCCIDENTAL FOREST INC.
EMPLOYEE SAVINGS PLAN INTO THE
STOCKPLUS INVESTMENT PLAN
The Diamond Occidental Forest Inc. Employee Savings Plan
the "DOFI Plan") was merged into the StockPlus Investment Plan on or around
April 1, 1995 (for purposes of this Appendix, the "Merger Date"). Contributions
to the DOFI Plan were frozen in 1993. The following special provisions relate to
accounts transferred from the DOFI Plan:
1. All accounts in the DOFI Plan immediately before the Merger
Date were transferred to this Plan as of the Merger Date and shall be
administered according to the provisions of this Plan, subject to the special
provisions described below. Employees and former employees who had accounts in
the DOFI Plan immediately before the Merger Date are referred to as "Former DOFI
Employees."
2. A Former DOFI Employee's accounts under the DOFI Plan will be
held in the following Accounts for the Former DOFI Employee under this
Plan:
(a) The DOFI Plan account attributable to before-tax
contributions shall be held in the Before-Tax Contributions Account.
(b) The DOFI Plan account attributable to after-tax
contributions shall be held in the After-Tax Contributions Account.
(c) The DOFI Plan account attributable to employer
contributions shall be held in the Before-Tax Matching
Contributions Account.
(d) The DOFI Plan account attributable to rollover
contributions shall be held in the Rollover Account.
3. Each Former DOFI Employee's Accounts shall be invested
according to the terms of this Plan.
4. Each Former DOFI Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
(a) An amount equal to the balance in a Former DOFI
Employee's DOFI Plan accounts as of the Merger Date shall be
considered a J&S Account and shall be subject to the joint and
survivor annuity optional form of benefit provisions of Appendix N
of this Plan. Plan earnings after the Merger Date on amounts
transferred from the DOFI Plan shall not be considered part of
the J&S Account and shall not be subject to the joint and
survivor annuity optional form of benefit rules.
(b) As of the end of any Plan Year quarter, a Former
DOFI Employee who has attained age 59-1/2 may elect to withdraw part
or all of the Former DOFI Employee's interest in the portion of his
Before-Tax Contributions Account that is attributable to before-tax
contributions made under the DOFI Plan. The withdrawal shall be made
pursuant to the administrative procedures described in Section 7.2.
5. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect to
the accounts transferred from the DOFI Plan. The Plan shall be administered
consistent with the requirements of Section 411(d)(6) of the Internal Revenue
Code and the Treasury regulations thereunder.
APPENDIX E
MERGER OF THE PAPER ART COMPANY, INC.
401(K) PROFIT SHARING PLAN INTO THE
STOCKPLUS INVESTMENT PLAN
The Paper Art Company, Inc. 401(k) Profit Sharing Plan
(the "Paper Art Plan") was merged into the StockPlus Investment Plan
on or around July 31, 1996 (for purposes of this Appendix, the "Merger Date").
Contributions to the Paper Art Plan were frozen in 1993. The following special
provisions relate to accounts transferred from the Paper Art Plan:
1. All accounts in the Paper Art Plan immediately before the
Merger Date were transferred to this Plan as of the Merger Date. Employees and
former employees who had accounts in the Paper Art Plan immediately before the
Merger Date are referred to as "Former Paper Art Employees" for purposes
of this Appendix.
2. A Former Paper Art Employee's accounts under the Paper Art
Plan that are not transferred to Buyer's 401(k) Plans will be held in the
following Accounts for the Former Paper Art Employee under this Plan:
(a) The Paper Art Plan account attributable to before-tax
contributions shall be held in the Before-Tax Contributions
Account.
(b) The Paper Art Plan account attributable to employer
contributions and rollover contributions shall be held
in the Rollover Account.
3. Each Former Paper Art Employee's Accounts shall be invested
according to the terms of this Plan.
4. Each Former Paper Art Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
(a) An amount equal to the balance in a Former Paper Art
Employee's Paper Art Plan accounts as of the Merger
Date shall be considered a J&S Account and shall be subject
to the joint and survivor annuity optional form of benefit
provisions of Appendix N of this Plan. Plan earnings after the
Merger Date on amounts transferred from the Paper Art Plan
shall not be considered part of the J&S Account and shall
not be subject to the joint and survivor annuity optional
form of benefit rules.
(b) If a Former Paper Art Employee has a loan from the
Paper Art Plan that is outstanding as of the Merger
Date, the loan will remain outstanding under the merged Plan
until paid or otherwise satisfied according to its terms. In
other respects, Plan loans will be governed by the provisions
of Section 7.3 of this Plan.
5. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect to
the accounts transferred from the Paper Art Plan. The Plan shall be
administered consistent with the requirements of Section 411(d)(6) of the
Internal Revenue Code and the Treasury regulations thereunder.
APPENDIX F
MERGER OF THE PAPER ART COMPANY, INC.
401(K) PLAN FOR BARGAINING UNIT EMPLOYEES
INTO THE STOCKPLUS INVESTMENT PLAN
The Paper Art Company, Inc. 401(k) Plan for Bargaining Unit Employees
(the "Paper Art Bargained Plan") was merged into the StockPlus Investment Plan
on or around July 31, 1996 (for purposes of this Appendix, the "Merger Date").
Contributions to the Paper Art Bargained Plan were frozen in 1993. The
following special provisions relate to accounts transferred from the Paper Art
Bargained Plan:
1. All accounts in the Paper Art Bargained Plan immediately
before the Merger Date were transferred to this Plan as of the Merger Date.
Employees and former employees who had accounts in the Paper Art Bargained Plan
immediately before the Merger Date are referred to as "Former Paper Art
Employees" for purposes of this Appendix.
2. A Former Paper Art Employee's accounts under the Paper Art
Bargained Plan that are not transferred to Buyer's 401(k)Plans will be held in
the following Accounts for the Former Paper Art Employee under this Plan:
(a) The Paper Art Bargained Plan account attributable to
before-tax contributions shall be held in the Before-Tax
Contributions Account.
(b) The Paper Art Bargained Plan account attributabl
to rollover contributions shall be held in the Rollover Account.
(c) Each Former Paper Art Employee's Accounts shall be
invested according to the terms of this Plan.
3. Each Former Paper Art Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
If a Former Paper Art Employee has a loan from the Paper Art
Bargained Plan that is outstanding as of the Merger Date, the
loan will remain outstanding under the merged Plan until paid or
otherwise satisfied according to its terms. In other respects, Plan
loans will be governed by the provisions of Section 7.3 of this Plan.
4. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect to
the accounts transferred from the Paper Art Union Plan. The Plan shall be
administered consistent with the requirements of Section 411(d)(6) of the
Internal Revenue Code and the Treasury regulations thereunder.
APPENDIX G
MERGER OF THE RAMPART PACKAGING, INC.
SALARY DEFERRAL PLAN INTO THE
STOCKPLUS INVESTMENT PLAN
The Rampart Packaging, Inc. Salary Deferral Plan (the "Rampart Plan")
was merged into the StockPlus Investment Plan on or around April 1, 1995
(for purposes of this Appendix, the "Merger Date"). Contributions to the
Rampart Plan were frozen in 1991. The following special provisions relate to
accounts transferred from the Rampart Plan:
1. All accounts in the Rampart Plan immediately before the Merger
Date were transferred to this Plan as of the Merger Date and shall be
administered according to the provisions of this Plan, subject to the special
provisions described below. Employees and former employees who had accounts in
the Rampart Plan immediately before the Merger Date are referred to as "Former
Rampart Employees".
2. A Former Rampart Employee's accounts under the Rampart Plan w
will be held in the following Accounts for the Former Rampart Employee under
this Plan:
(a) The Rampart Plan account attributable to before-tax
contributions shall be held in the Before-Tax Contributions Account.
(b) The Rampart Plan account attributable to employer
contributions shall be held in the Before-Tax Matching
Contributions Account.
(c) The Rampart Plan account attributable to rollover
contributions shall be held in the Rollover Account.
3. Each Former Rampart Employee's Accounts shall be invested
according to the terms of this Plan.
4. Each Former Rampart Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
If a Former Rampart Employee has a loan from the Rampart Plan that is
outstanding as of the Merger Date, the loan will remain outstanding
under the merged Plan until paid or otherwise satisfied according to
its terms. In other respects, Plan loans will be governed by the
provisions of Section 7.3 of this Plan.
5. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect
to the accounts transferred from the Rampart Plan. The Plan shall be
administered consistent with the requirements of Section 411(d)(6) of the
Internal Revenue Code and the Treasury regulations thereunder.
APPENDIX H
PROVISIONS RELATING TO FORMER EMPLOYEES OF
BENCHMARK HOLDINGS, INC. AND WINCUP HOLDINGS, INC.
Certain employees of Benchmark Holdings, Inc. ("Benchmark") and WinCup
Holdings, Inc. ("WinCup") became employees of James River Paper Company, Inc.
("JR Paper Company") as of November 6, 1995 (the "Acquisition Date") pursuant to
the acquisition by JR Paper Company of certain assets and stock from Benchmark
and WinCup. For purposes of this Appendix H, the employees of Benchmark and
WinCup who became employees of JR Paper Company as of the Acquisition Date shall
be referred to as "Former Benchmark Employees." The following special provisions
relate to Former Benchmark Employees and to accounts transferred to this Plan
from the Benchmark Corporation of Delaware 401(k) Savings and Profit Sharing
Plan (the "Benchmark Plan"):
1. Each Former Benchmark Employee's Service under the Plan shall
include periods of employment with Benchmark and WinCup. The accounts of Former
Benchmark Employees under the Benchmark Plan were transferred to this Plan and
shall be administered according to the provisions of this Plan, subject to the
special provisions described below.
2. Each Former Benchmark Employee's Accounts shall be invested
according to the terms of this Plan.
3. If a Former Benchmark Employee has a loan from the Benchmark
Plan that is outstanding as of the Acquisition Date, the loan will remain
outstanding under this Plan until paid or otherwise satisfied according to its
terms. In other respects, Plan loans will be governed by the provisions of
Section 7.3 of this Plan.
4. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect to
the accounts transferred from the Benchmark Plan. The Plan shall be
administered consistent with the requirements of Section 411(d)(6) of the
Internal Revenue Code and the Treasury regulations thereunder.
APPENDIX I
EFFECTIVE DATES FOR CERTAIN PLAN PROVISIONS
This Appendix I sets forth certain provisions of the Plan that are
effective for specified periods prior to the general Effective Date of the Plan:
1. The definition of "Highly Compensated Employee" contained in
Section 2.16 shall apply for Plan Years beginning on or after January 1, 1997.
2. The definition of "Taxable Compensation" contained in
Section 2.36 shall apply for Plan Years beginning on or after January 1, 1998.
3. The provisions of Section 5.3(a) (regarding the limit on
annual additions) shall apply for Plan Years beginning on or after
January 1, 1995.
4. The provisions of Section 5.4(b) (relating to the
nondiscrimination test for Before-Tax Contributions) shall apply for Plan Years
beginning on or after January 1, 1997.
5. The provisions of Section 5.5(b) (relating to the
nondiscrimination test for Matching Contributions) shall apply for Plan Years
beginning on or after January 1, 1997.
6. The provisions of Section 5.6 (relating to excess Before-Tax
Contributions and Matching Contributions) shall apply for Plan Years beginning
on or after January 1, 1997.
7. For Plan Years beginning on January 1, 1997 and ending on
December 31, 1998, the following provision shall apply in addition to the
provisions contained in Section 6.4(f):
Notwithstanding the foregoing, any Participant who is not a 5% owner and
who attains age 70-1/2 on or after January 1, 1996 but prior to January 1,
1999 shall begin to receive distribution of his or her Account by no later
than April 1 of the calendar year following the calendar year in which they
attained age 70-1/2, unless the Participant elects to defer distribution of
his or her Account until no later than April 1 of the calendar year
following the calendar year in which the Participant retires.
8. The provisions of Section 6.4 and Appendix N (concerning whether a
Participant's Account exceeds $5,000, at the time of termination from
employment) shall apply for Plan Years beginning on or after January 1, 1998.
9. The provisions of section (b)(ii) of Appendix N (concerning a
Participant's right to waive the 30-day notice) shall apply for Plan Years
beginning on or after January 1, 1997.
APPENDIX J
SPECIAL PROVISIONS RELATING TO
ASHLAND MILL EMPLOYEES
A. 1996 Profit Sharing Distribution
All regular employees at the Ashland Mill covered under a collective
bargaining agreement with Local 1104 of the United Paperworkers
International Union as of May 1, 1996 were paid a special profit sharing
distribution of $665. Notwithstanding the provisions of Section 4.1 to the
contrary, Ashland Mill employees may elect to have the entire amount of such
profit sharing distribution contributed to the Plan as a Before-Tax Contribution
for the Plan Year ending December 31, 1996, provided that such contribution does
not exceed the limits provided in Section 4.1(b) and 5.3(a) of the Plan.
If an Ashland Mill employee elects to contribute his or her profit
sharing distribution to the Plan, such profit sharing distribution shall be
treated as having been contributed to the Plan after all other Before-Tax
Contributions have been contributed to the Plan. No Matching Contributions shall
be made for 1996 with respect to that portion of an Ashland Mill employee's
Before-Tax Contributions attributable to the profit sharing distribution.
B. 1998 Plant Closing
In connection with the closure of the Ashland Mill in February 1998,
all regular employees at the mill, including those employees under a
collective bargaining agreement with Local 1104 of the United Paperworkers
International Union, whose employment terminated as a result of the closing of
the Ashland Mill received severance pay. Notwithstanding the provisions of
Section 4.1 to the contrary, such Ashland Mill employees may elect to have the
entire amount of their severance pay contributed to the Plan as a Before-Tax
Contribution for the Plan Year ending December 31, 1998, provided that such
contribution does not exceed the limits provided in Section 4.1(b) and 5.3(a) of
the Prior Plan.
If an Ashland Mill employee elects to contribute his or her severance
pay to the Plan, such severance pay shall be treated as having been
contributed to the Plan after all other Before-Tax Contributions have been
contributed to the Plan. No Matching Contributions shall be made with respect to
that portion of an Ashland Mill employee's Before-Tax Contributions attributable
to the severance pay.
APPENDIX K
MERGER OF THE
FORT HOWARD CORPORATION
PROFIT SHARING RETIREMENT PLAN INTO THE PLAN
The Fort Howard Corporation Profit Sharing Retirement Plan
(the "Fort Howard Plan") will be merged into the Plan on or around January 1,
1999 (for purposes of this Appendix, the "Merger Date"). The following special
provisions relate to accounts transferred from the Fort Howard Plan:
1. All accounts in the Fort Howard Plan immediately before the
Merger Date shall be transferred to this Plan as of the Merger Date and
shall be administered according to the provisions of this Plan, subject to the
special provisions described below. Employees and former employees who have
accounts in the Fort Howard Plan immediately before the Merger Date are referred
to as "Former Fort Howard Employees."
2. Each Former Fort Howard Employee's accounts under the Fort
Howard Plan will be held in such Accounts under this Plan as the Plan
Administrator may establish.
3. Accounts attributable to Former Fort Howard Employees who are
Employees as of the Merger Date shall be 100% vested as of the Merger Date.
4. If a Participant in this Plan who received a distribution of
amounts under the Fort Howard Plan prior to the Merger Date is reemployed
by the Employer before he has incurred five (5) consecutive one-year breaks in
Service, those amounts shall be credited with the amount he forfeited, if any,
at the time of his prior termination if he repays the amount of the distribution
that he previously received. In the event such former Participant makes a
repayment of his prior distribution or if he has not received any distribution,
the amount of such Participant's forfeiture, if any, at the time of his prior
termination shall be restored after the Participant has been reemployed by the
Employer for a 12 consecutive month period, and upon reemployment the
Participant's years of Service shall include years of Service completed before
the breaks in Service.
5. If a Former Fort Howard Employee has a loan from the Fort
Howard Plan that is outstanding as of the Merger Date, the loan will remain
outstanding under this Plan until paid or otherwise satisfied according to its
terms. In other respects, Plan loans will be governed by the provisions of
Section 7.3 of this Plan.
6. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal Revenue Code with respect
to the accounts transferred from the Fort Howard Plan. The Plan should be
administered consistent with the requirements of Section 411(d)(6) of the
Internal Revenue Code and the Treasury Regulations thereunder.
APPENDIX L
MERGER OF THE
HARMON ASSOC., CORP.
PROFIT SHARING PLAN INTO THE PLAN
The Harmon Assoc., Corp. Profit Sharing Plan (the "Harmon Plan") will
be merged into the Plan on or around January 1, 1999 (for purposes of this
Appendix, the "Merger Date"). The following special provisions relate to
accounts transferred from the Harmon Plan:
1. All accounts in the Harmon Plan immediately before the Merger
Date shall be transferred to this Plan as of the Merger Date and shall be
administered according to the provisions of this Plan, subject to the special
provisions described below. Employees and former employees who have accounts in
the Harmon Plan immediately before the Merger Date are referred to as "Former
Harmon Employees."
2. Each Former Harmon Employee's accounts under the Harmon Plan
will be held in such Accounts under this Plan as the Plan Administrator may
establish.
3. Accounts attributable to Former Harmon Employees who are
Employees as of the Merger Date shall be 100% vested as of,the Merger Date.
4. If a Participant in this Plan who received a distribution of
amounts under the Harmon Plan prior to the Merger Date is reemployed by the
Employer before he has incurred five (5) consecutive one-year breaks in Service,
those amounts shall be credited with the amount he forfeited, if any, at the
time of his prior termination if he repays the amount of the distribution that
he previously received. In the event such former Participant makes a repayment
of his prior distribution or if he has not received any distribution, the amount
of such Participant's forfeiture, if any, at the time of his prior termination
shall be restored after the Participant has been reemployed by the Employer for
a 12 consecutive month period, and upon reemployment the Participant's years of
Service shall include years of Service completed before the breaks in Service.
5. Each Former Harmon Employee's Accounts shall be held and
administered according to the terms of this Plan, subject to the
following rules:
(a) If a Former Harmon Employee has a loan from the
Harmon Plan that is outstanding as of the Merger Date, the loan will
remain outstanding under this Plan until paid or otherwise satisfied
according to its terms. In other respects, Plan loans will be governed
by the provisions of Section 7.3 of this Plan.
(b) For purposes of electing a form of benefit by a
Former Harmon Employee, the following optional forms of benefit are
available, in addition to those offered in Section VI:
(i) Life Annuity;
(ii) Life Annuity with five (5) year or ten (10)
year period certain;
(iii) Joint and Survivor Annuity, with the amount
of the annuity payable to the Surviving Spouse to be 50% or 100% of the
amount payable to the Former Harmon Employee.
For purposes of this subsection (b), the forms of benefit described above
are available only with respect to the Former Harmon Employee's account balance
in the Harmon Plan as of December 31, 1994.
(c) Notwithstanding anything else in the Plan to the contrary, for
purposes of subsection (b), a Participant may not elect to receive any
annuity form of benefit without first waiving the Joint and Survivor Annuity
form of benefit with appropriate spousal consent, if any, as provided in
subsection (iii) below. The Plan Administrator shall provide suitable forms and
shall establish reasonable procedures for such a waiver.
In order to be valid, a waiver: (i) must be signed by the Participant and
his spouse, if any; (ii) must designate a form of benefits or specific
alternate Beneficiary that cannot be changed without the spouse's consent;
and (iii) the spouse's consent must acknowledge the effect of the election
and must be witnessed by a notary public or by a person authorized by the
Plan Administrator.
If it is established to the satisfaction of the Plan Administrator that the
spouse cannot be located, or is otherwise unable to sign, the spouse's signature
shall not be required. Any consent by a spouse (or establishment that the
spouse's consent cannot be obtained) under the foregoing provisions shall be
effective only with respect to that spouse. A spouse's consent applies only to
the Beneficiary designation executed simultaneously by the Participant, unless
the spousal consent waives all future rights of the spouse to consent to
additional Beneficiaries or changes to the current Beneficiary. The Plan
Administrator may require a married Participant or his spouse to supply such
information as the Plan Administrator deems necessary to verify the
Participant's marital status and the identification of the Participant's spouse.
(d) If a married Participant dies before payment of the portion of his
account balance attributed to the Harmon Plan as of December 31, 1994 has
begun, such portion of the Participant's account will be distributed to the
Participant's surviving spouse in the form of a Qualified Pre-Retirement
Survivor Annuity, unless the Participant rejects this form of benefit before his
death, with the consent of his spouse, in the manner described in Appendix N
subparagraph (e), or unless the spouse elects to receive another form of payment
permitted under the Plan.
(e) If the Qualified Pre-Retirement Survivor Annuity is rejected or if
an unmarried Participant dies before payment of the portion of his account
balance attributed to the Harmon Plan as of December 31, 1994 has begun, the
portion of such Participant's account will be paid to the designated Beneficiary
in the form provided by Section 6.4.
6. The provisions of this Plan are intended to comply with the
requirements of Section 411(d)(6) of the Internal,Revenue Code with respect to
the accounts transferred from the Harmon Plan. The Plan should be administered
consistent with the requirements of Section 411(d)(6) of the Internal Revenue
Code and the Treasury Regulations thereunder.
APPENDIX M
MATCHING CONTRIBUTIONS UNDER SECTION 4.2(a)(ii)
The following groups of Participants are entitled to receive Matching
Contributions pursuant to the provisions Section 4.2(a)(ii):
Location Union
Camas Mill AWPPW Local No. 5
Charlotte Plant PACE Local No. 1089
Costigan Chip Mill PACE Local No. 80
Darlington Plant No union representative.
EPIC Plant PACE Local No. 323
Fort Smith Plant PACE Local No. 656
Garden Grove Carton Plant PACE Local No. 307
Gordonsville Carton Plant PACE Local No. 785
Green Bay-East Mil PACE Local Nos. 213 and 327
Halsey Mill PACE Local Nos. 1146, 1171 and 1234
Houlton Chip Mill PACE Local No. 1977
Kalamazoo Board Mill IBT Local No. 7
Kalamazoo Board Mill PACE Local No. 1010
LCR-Fibre Farm PACE Local No. 1097
Lehigh Valley Plant PACE Local No. 412
Lexington Plant IBT Local No. 651
Menasha Carton Plant PACE Local No. 148
Menasha Carton Plant GCIU Local No. 77P
Naheola Mill IBEW Local No. 2048
Naheola Mill PACE Local Nos. 950 (P&M), 952, 966
Naheola Mill PACE Local No. 950 (O&C)
Neenah Technical Center PACE Local No. 148
Newnan Carton Plant GCIU Local No. 641S
North Portland Carton Plant AWPPW Local No. 78
Northwest Service Center IBU CRR (Kelly Point)
Northwest Service Center IBU CRR
Old Town Mill PACE Local No. 80
Old Town Mill PACE Local No. 80 (Clerical)
Perrysburg Carton Plant IBT Local No. 20
Portland Carton Plant AWPPW Local No. 64
St. Mary's Mill PACE Local No. 958
Wausau Carton Plant PACE Local No. 224
Wausau Carton Plant GCIU Local No. 370C
Wauna Mill PACE Local No. 1097
APPENDIX N
JOINT AND SURVIVOR ANNUITY RULES
If an Account is transferred from a plan in which the Qualified Joint
and Survivor Annuity was the normal form of benefit, as designated by the
establishment of a J&S Account for the Participants under this Plan, then the
provisions of this Appendix N shall apply to the portion of the Participant's
account held in the J&S Account.
(a) Prior to January 1, 1999, the J&S Account was subject to the following
requirements:
(i) If a Participant was married at the time his benefits were to commence
and the Participant's vested Account balance exceeded $5,000 ($3,500 prior
to January 1, 1998) at the time of termination from employment, the
Participant's J&S Account was paid in the form of a Qualified Joint and
Survivor Annuity, unless the Participant rejected this form of payment,
with the consent of his spouse, in the manner described below.
(ii) If a Participant was unmarried at the time his benefits were to
commence and the Participant's vested Account balance exceeded $5,000
($3,500 prior to January 1, 1998) at the time of termination from
employment, the Participant's J&S Account was paid in the form of a Single
Life Annuity, unless the Participant rejected this form of payment in the
manner described below.
(iii) If the forms of payment described in subsections (i) and (ii) had
been rejected or did not apply, a Participant's J&S Account was paid in the
form otherwise designated under this Plan.
(iv) If a married Participant died before payment of his J&S Account had
begun and if the Participant's vested Account balance exceeded $5,000
($3,500 prior to January 1, 1998) at the time of termination from
employment, the Participant's J&S Account was distributed to the
Participant's surviving spouse in the form of a Qualified Pre-Retirement
Survivor Annuity, unless the Participant elected otherwise before his
death, with the consent of his spouse, in the manner described below, or
unless the spouse elected to receive another form of payment permitted
under the Plan. If the Qualified Pre-Retirement Survivor Annuity was
rejected, the J&S Account was paid to the designated Beneficiary in the
form provided by Section 6.4.
(b) In order to reject the Qualified Joint and Survivor Annuity, Qualified
Pre-Retirement Survivor Annuity, or Single Life Annuity forms of payment
from a J&S Account prior to January 1, 1999, the Participant and his spouse, if
any, must have executed a written election in the manner and form described
below:
(i) The Plan Administrator provided a written explanation to each
Participant who had a J&S Account of: (A) the terms and conditions of the
Qualified Joint and Survivor Annuity, Qualified Pre-Retirement Survivor
Annuity, or Single Life Annuity, whichever applied; (B) the Participant's
right to make and revoke elections and the method by which the Participant
may have done so; (C) the effect of such an election on the benefits of the
Participant and the spouse; and (D) the rights of the Participant's spouse
regarding the election.
(ii) The written explanation of the Qualified Joint and Survivor Annuity
and Single Life Annuity was provided no earlier than 90 days and no later
than 30 days before the "annuity starting date," as defined in subsection
(c)(iii)(A) below. The Plan Administrator provided the written explanation
of the Qualified Pre-Retirement Survivor Annuity before the end of the
"applicable period" with respect to each Participant. The applicable period
was the latest to occur of:
(A) The period beginning with the first day of the Plan Year in which
the Participant attained age 32 and ending with the close of the Plan Year
preceding the Plan Year in which the Participant attained age 35;
(B) A reasonable period after the individual became a Participant;
(C) A reasonable period ending after the survivor benefit provisions
applied to the Participant; or
(D) A reasonable period after termination of employment, in the case
of a Participant who terminated employment before attaining age 35.
A Participant may have elected, with the consent of his Spouse, if
any, to waive the requirement that the written election be provided no
later than 30 days before the annuity starting date if, after receiving
written notice from the Plan Administrator of his right to at least 30 days
to consider his rights under this Appendix N, distribution of the
Participant's Account began no earlier than seven (7) days after the
written explanation of the Qualified Joint and Survivor Annuity or Single
Life Annuity was provided to the Participant. This subsection (c)(ii) was
administered in accordance with applicable Treasury Regulations.
(iii) The election periods were established as follows:
(A) The period during which a Participant was permitted to elect not
to receive the Qualified Joint and Survivor Annuity or Single Life Annuity
was the period beginning 90 days before the date on which his benefits
became payable (the "annuity starting date") and ending on the annuity
starting date.
(B) The period during which a Participant was permitted to elect not
to receive the Qualified Pre-Retirement Survivor Annuity was the period
beginning on the first day of the Plan Year during which the Participant
attained age 35 and ending on the date of the Participant died. However, if
a Participant terminated employment before he attained age 35, his election
period began on the date he terminated employment.
Each of the elections were permitted to be made or revoked
by the Participant with his spouse's consent at any time during the
applicable election period; however, spousal consent to an election was
irrevocable after it had been given. After the expiration of the applicable
election period, an election was final and could not be changed.
(iv) The Plan Administrator provided suitable forms and established
reasonable procedures for elections. In order to be valid, an election or
revocation of an election: (A) must have been signed by the Participant and
his spouse, if any; (B) must have designated a form of benefits or specific
alternate Beneficiary that could not be changed without the spouse's
consent; and (C) the spouse's consent must have acknowledged the effect of
the election and must have been witnessed by a notary public or by a person
authorized by the Plan Administrator. If it was established to the
satisfaction of the Plan Administrator that the spouse could not have been
located, or was otherwise unable to sign, the spouse's signature was not
required. Any consent by a spouse (or establishment that the spouse's
consent could not be obtained) under the foregoing provisions was effective
only with respect to that spouse. A spouse's consent applied only to the
Beneficiary designation executed simultaneously by the Participant, unless
the spousal consent waived all future rights of the spouse to consent to
additional Beneficiaries or changes to the current Beneficiary. The Plan
Administrator was permitted to require a married Participant or his spouse
to supply such information as the Plan Administrator deemed necessary to
verify the Participant's marital status and the identification of the
Participant's spouse.
(c) If a Participant's Account balance exceeded $5,000 ($3,500 prior
to January 1, 1998) at the time of termination from employment and part or
all of the Participant's J&S Account was to be distributed before the
Participant attained age 65, the Participant and his spouse, if any, must
have consented to a distribution from the J&S Account before it was made.
The consent of the Participant and his spouse must have been given in
writing on a form designated by the Plan Administrator. To the extent
required by law, such form, and a notice which explained the optional forms
of benefit available to the Participant and his spouse and his right to
defer the receipt of his benefits, was provided to the Participant no less
than 30 days and no more than 90 days before the date on which the
distribution was to commence. Payment from the J&S Account was made or
began to be made as soon as administratively feasible after the Participant
requested the payment, with the consent of his spouse, if any, but no less
than 30 days after the notice form was given to the Participant.
(d) Effective January 1, 1999, the J&S Account will be distributed in
accordance with the optional form of benefit provisions of Section VI or by
another applicable Appendix. For purposes of electing a form of benefit by
a Participant with a J&S Account, a joint and survivor annuity form of
benefit is available as an optional form of benefit, in addition to those
offered in Section VI or by another applicable Appendix. Once the
Participant makes an election to receive his J&S Account in the form of any
Annuity form it shall be a Qualified Joint and Survivor Annuity and will be
subject to the following requirements:
(i) If a Participant is married at the time his benefit is to commence
and the Participant's vested Account balance exceeds $5,000 ($3,500 prior
to January 1, 1998) at the time of termination from employment, the
Participant's J&S Account will be paid in the form of a Qualified Joint and
Survivor Annuity, unless the Participant subsequently rejects this form of
payment, with the consent of his spouse, in the manner described below.
(ii) If a Participant is unmarried at the time his benefits are to
commence and the Participant's vested Account balance exceeds $5,000
($3,500 prior to January 1, 1998) at the time of termination from
employment, the Participant's J&S Account will be paid in the form of a
Single Life Annuity, unless the Participant subsequently rejects this form
of payment.
(iii) If the forms of payment described in subsections (i) and (ii)
above have been rejected or do not apply, a Participant's J&S Account will
be paid in the form otherwise designated under Section 6.4.
(iv) If a married Participant dies before payment of his J&S Account
has begun and if the Participant's vested Account balance exceeds $5,000
($3,500 prior to January 1, 1998) at the time of termination from
employment, the Participant's J&S Account will be distributed to the
Participant's surviving spouse in the form of a Qualified Pre-Retirement
Survivor Annuity, unless the Participant elects otherwise before his death,
with the consent of his spouse, in the manner described in subparagraph (e)
below, or unless the spouse elects to receive another form of payment
permitted under the Plan.
(e) In order to reject the Qualified Joint and Survivor Annuity, Qualified
Pre-Retirement Survivor Annuity or Single Life Annuity forms of payment
from the portion of the Participant's account subject to the joint and
survivor annuity rules, the Participant and his spouse, if any, must
execute a written election in the manner and form described below:
(i) The Plan Administrator shall provide a written explanation to each
Participant who has such an account of: (A) the terms and conditions of the
Qualified Joint and Survivor Annuity, Qualified Pre-Retirement Survivor
Annuity or Single Life Annuity, whichever applies; (B) the Participant's
right to make and revoke elections and the method by which the Participant
may do so; (C) the effect of such an election on the benefits of the
Participant and the spouse; and (D) the rights of the Participant's spouse
regarding the election.
(ii) The written explanation of the Qualified Joint and Survivor
Annuity and Single Life Annuity shall be provided no earlier than 90 days
and no later than 30 days before the "annuity starting date," as defined in
subsection (e)(iii)(A) below. The Plan Administrator shall provide the
written explanation of the Qualified Pre-Retirement Survivor Annuity before
the end of the "applicable period" with respect to each Participant. The
applicable period is within a reasonable period after the survivor benefit
provisions apply to the Participant.
A Participant may elect, with the consent of his Spouse, if any, to
waive the requirement that the written election be provided no later
than 30 days before the annuity starting date if, after receiving written
notice from the Plan Administrator of his right to at least 30 days to
consider his rights under this Appendix N, distribution of the
Participant's Account will begin no earlier than seven (7) days after the
written explanation of the Qualified Joint and Survivor Annuity or Single
Life Annuity was provided to the Participant. This subsection (e)(ii) will
be administered in accordance with applicable Treasury Regulations.
(iii) The election periods are established as follows:
(A) The period during which a Participant is permitted to elect
not to receive the Qualified Joint and Survivor Annuity or Single Life
Annuity is the period beginning 90 days before the date on which his
benefits become payable (the "annuity starting date") and ending on
the annuity starting date.
(B) The period during which a Participant is permitted to elect
not to receive the Qualified Pre-Retirement Survivor Annuity is the
period beginning on the day the Participant terminates employment and
makes an election to receive an annuity form of benefit and ending on
the date the Participant dies.
Each of these elections are permitted to be made or revoked by
the Participant with his spouse's consent at any time during the
applicable election period; however, spousal consent to an election is
irrevocable after it has been given. After the expiration of the
applicable election period, an election is final and can not be
changed.
(iv) The Plan Administrator shall provide suitable forms and
establish reasonable procedures for elections. In order to be valid,
an election or revocation of an election: (A) must be singed by the
Participant and his spouse, if any; (B) must designate a form of
benefits or specific alternate Beneficiary that can not be changed
without the spouse's consent; and (C) the spouse's consent must
acknowledge the effect of the election and must be witnessed by a
notary public or by a person authorized by the Plan Administrator. If
it is established to the satisfaction of the Plan Administrator that
the spouse cannot be located, or is otherwise unable to sign, the
spouse's signature is not required. Any consent by a spouse (or
establishment that the spouse's consent cannot be obtained) under the
foregoing provisions is effective only with respect to that spouse. A
spouse's consent applies only to the Beneficiary designation executed
simultaneously by the Participant, unless the spousal consent waived
all future rights of the spouse to consent to additional Beneficiaries
or changes to the current Beneficiary. The Plan Administrator is
permitted to require a married Participant or his spouse to supply
such information as the Plan Administrator deems necessary to verify
the Participant's marital status and the identification of the
Participant's spouse.
(f) The Plan may pay a Qualified Joint and Survivor Annuity,
Single Life Annuity or Qualified Pre-Retirement Survivor Annuity by
the purchase and distribution of an annuity contract. The purchase and
distribution of an annuity contract to a Participant, spouse or
Beneficiary shall fully discharge any and all obligations of the Plan
to the Participant, spouse or Beneficiary, and neither the
Participant, spouse nor Beneficiary shall have any right or claim
against the Plan, the Plan Administrator or the Employer in the event
of the failure or default by the insurance company issuing the annuity
contract with respect to any or all payments due under the annuity
contract.
APPENDIX O
SPECIAL PROVISIONS FOR CANADIAN EMPLOYEES
The following special provisions apply to Participants who are
Canadian Employees:
1. The Account balance of a Canadian Employee whose employment
terminates for any reason will be distributed in a lump sum payment subject to
the provisions of Section 6.4(h).
2. Canadian Employees may make withdrawals from their Account in
accordance with the following provisions:
(a) Participants who are Canadian Employees may not make
withdrawals pursuant to Section 7.1 or 7.2 of the Plan. Instead,
as of any Valuation Date, a Participant who is a Canadian Employee may
withdraw all or any portion of his After-Tax Contributions Account
that does not exceed:
(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 After-Tax 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 shall be made by submitting an
application in such form and at such time as the Plan Administrator shall
designate.
Exhibit 23
CONSENT OF INDEPENDENT ACCOUNTANTS
----------------------------------
We consent to the incorporation by reference in the Registration Statement
of Fort James Corporation on Form S-8 (File No. 33-54491) of our report dated
May 21, 1999, on our audits of the financial statements of the James River
Corporation of Virginia StockPlus Investment Plan as of December 31, 1998 and
1997, and for the year ended December 31, 1998, which report is
included in this Annual Report on Form 11-K.
/s/ PRICEWATERHOUSECOOPERS LLP
Richmond, Virginia
June 24, 1999
