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 [FEE REQUIRED]
For the fiscal year ended _________________
OR
[X] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]
For the transition period from April 1, 1993 to December 31, 1993
Commission file number 1-225
A. Full title of the Plans and the address of the Plans, if
different from that of the issuer named below:
Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan
Kimberly-Clark Corporation Hourly
Employees Incentive Investment Plan
401 North Lake Street
Neenah, Wisconsin 54956
B. Name of issuer of the securities held pursuant to the Plans
and the address of its principal executive offices:
Kimberly-Clark Corporation
P. O. Box 619100
Dallas, Texas 75261-9100
<PAGE>
1. Financial Statements and Schedules
The financial statements and supplemental schedules for each of the
Plans have been prepared in accordance with the Employee Retirement
Income Security Act of 1974, and are filed as Exhibits 99.1 and 99.2
hereto and incorporated by reference herein. Pursuant to General
Instruction E of Form 11-K, such financial statements and schedules
have been filed in paper under cover of Form SE.
2. Kimberly-Clark Corporation Salaried Employees Incentive Investment
Plan
The Independent Auditor's Report with respect to the financial
statements and supplemental schedules of the Kimberly-Clark
Corporation Salaried Employees Incentive Investment Plan is set forth
in such financial statements and supplemental schedules filed as
Exhibit 99.1 hereto and incorporated by reference herein.
3. Kimberly-Clark Corporation Hourly Employees Incentive Investment Plan
The Independent Auditor's Report with respect to the financial
statements and supplemental schedules of the Kimberly-Clark
Corporation Hourly Employees Incentive Investment Plan is set forth
in such financial statements and supplemental schedules filed as
Exhibit 99.2 hereto and incorporated by reference herein.
4. Exhibits
10.1 Kimberly-Clark Corporation Salaried Employees Incentive
Investment Plan, as amended through May 24, 1994.
10.2 Kimberly-Clark Corporation Hourly Employees Incentive
Investment Plan, as amended through May 24, 1994.
23 Consent of Deloitte & Touche, Independent Auditors.
99.1 Kimberly-Clark Corporation Salaried Employees Incentive
Investment Plan Financial Statements and Supplemental
Schedules. Pursuant to General Instruction E of Form 11-
K, such financial statements and supplemental schedules
have been filed in paper under cover of Form SE.
99.2 Kimberly-Clark Corporation Hourly Employees Incentive
Investment Plan Financial Statements and Supplemental
Schedules. Pursuant to General Instruction E of Form 11-
K, such financial statements and supplemental schedules
have been filed in paper under cover of Form SE.
<PAGE>
SIGNATURES
The Plans. Pursuant to the requirements of the Securities Exchange Act of
1934, Kimberly-Clark Corporation, as Plan Administrator of the Kimberly-
Clark Corporation Salaried Employees Incentive Investment Plan and the
Kimberly-Clark Corporation Hourly Employees Incentive Investment Plan, has
duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
KIMBERLY-CLARK CORPORATION
SALARIED EMPLOYEES INCENTIVE
INVESTMENT PLAN and
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE
INVESTMENT PLAN
Date: June 15, 1994 By: Kimberly-Clark Corporation
Plan Administrator
/s/ Bruce J. Olson
By: Bruce J. Olson
Vice President - Corporate
Services
<PAGE>
EXHIBIT INDEX
Exhibit Description
10.1 Kimberly-Clark Corporation Salaried Employees Incentive
Investment Plan, as amended through May 24, 1994 (Attached
hereto)
10.2 Kimberly-Clark Corporation Hourly Employees Incentive
Investment Plan, as amended through May 24, 1994 (Attached
hereto)
23 Consent of Deloitte & Touche, Independent Auditors (Attached
hereto)
99.1 Kimberly-Clark Corporation Salaried Employees Incentive
Investment Plan Financial Statements and Supplemental
Schedules (Previously filed on Form SE)
99.2 Kimberly-Clark Corporation Hourly Employees Incentive
Investment Plan Financial Statements and Supplemental
Schedules (Previously filed on Form SE)
EXHIBIT 10.1
<TABLE>
<S> <C>
KIMBERLY-CLARK CORPORATION SALARIED
EMPLOYEES INCENTIVE INVESTMENT PLAN
(As amended through May 24, 1994)
ARTICLE I
NAME, PURPOSE AND EFFECTIVE DATE OF PLAN
This Kimberly-Clark Corporation Salaried Employees Incentive
Investment Plan (the "Plan") has been adopted effective August 1,
1967. Its purpose is to promote the interests of the Corporation
and its stockholders by encouraging Eligible Employees to arrange
for personal investment programs which, depending upon the success
of the Corporation, will be augmented by Company Matching
Contributions. It provides each Eligible Employee with an
opportunity to become a stockholder of the Corporation. To comply
with the applicable requirements of the Tax Reform Act of 1986,
the Plan has been restated in its entirety effective March 31,
1993, except as otherwise provided in Section 11.12 hereof. [The
following sentence is effective September 1, 1994:] The Plan is
intended to be an employee stock ownership plan, as defined in
section 4975 of the Code, and is designed to invest primarily in
qualifying employer securities, as defined in section 409(l) of
the Code.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employees for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic After-Tax Contributions (including amounts
recharacterized as Basic After-Tax Contributions
under subsection 3.5(b)(iii)), and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year (but only
to the extent that such Contributions and Company
Matching Contributions are not considered for
purposes of Section 2.1(c) hereof), together with
qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Actual Deferral Percentage: A percentage which, for a
specified group of Eligible Employees for a Plan Year,
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of 401(k) Contributions remitted to the
Trustee on behalf of each such Eligible Employee
for such Plan Year (and, to the extent determined
appropriate by the Committee, such other
Contributions and Company Matching Contributions as
may be used to determine the actual deferral
percentage under Code section 401(k) and
regulations thereunder), to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the 401(k) Contributions
and Total Compensation of such Highly Compensated
Eligible Employee shall include the 401(k) Contributions
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(d) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(e) Base Salary Rate: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of regular earnings
while a Participant. Base Salary Rate shall be
determined before 401(k) Contributions pursuant to
subsection 3.2(a), and any elective salary reduction
contributions pursuant to Code Section 125, are
deducted. With respect to any Eligible Employee on a
foreign assignment, such Eligible Employee's Base Salary
Rate shall disregard any adjustment which is made to
such Eligible Employee's salary as a result of such
foreign assignment. Notwithstanding the foregoing, the
amount of any Eligible Employee's compensation which is
taken into account for purposes of determining such
Eligible Employee's Base Salary Rate under the Plan
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(f) Basic After-Tax Contributions: 401(k) Contributions in
excess of the limitation under subsection 3.5(a)(i)
which are recharacterized under subsection 3.5(b)(iii),
Special Basic-After Tax Contributions, and any other
employee contributions, as defined in Code section
401(m) and the regulations thereunder on account of
which a Company Matching Contribution was made to this
Plan on behalf of the Participant, excluding any such
employee contributions contributed prior to April 1,
1990, made on behalf of a Participant who was employed
prior to April 1, 1989.
(g) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation, or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(h) Board: The Board of Directors of the Corporation.
(i) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(j) Commissioner: The Commissioner of the Internal Revenue
Service.
(k) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(l) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(m) Contributions: Amounts deposited under the Plan by or
on behalf of Participants as provided in Article III.
(n) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(o) Corporation Stock: The common stock of the Corporation.
(p) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(q) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(r) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(s) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(s)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(t) Employee: A person employed by an Employer.
(u) Employee Accounts: Those Accounts specified in
subsections (v), (w), (x) and (y) of this Section 2.1.
(v) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(w) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(x) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(y) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(z) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(aa) Employer Accounts: Those Accounts specified in
subsections (bb), (cc), (dd) and (ee) of this Section
2.1.
(bb) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(cc) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(dd) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ee) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ff) Entry Date: The first day of each month.
(gg) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(hh) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(ii) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) 401(k) Contributions: Contributions made by Employers
on behalf of Participants under subsection 3.2(a) on or
after April 1, 1983 that are considered deferred within
the meaning of Code section 401(k) and regulations
thereunder.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(pp) Lump Sum Distribution: As defined in subsection 7.3(a).
(qq) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(rr) Matured Withdrawal Year: As defined in Section 8.2.
(ss) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(tt) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(uu) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(vv) Optional Annuity Distribution: As defined in subsection
7.3(c).
(ww) Optional Installment Distribution: As defined in
subsection 7.3(d).
(xx) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1. He remains a
Participant until all of his Accounts have been
distributed pursuant to the Plan.
(yy) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated are shown in Appendix A.
(zz) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(aaa) Regular Basic After-Tax Contributions: After-tax
Contributions made through regular payroll deductions
under subsection 3.5(a)(ii).
(bbb) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(ccc) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(ddd) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in subsection 8.6(a) for
purposes of Article VIII.
(eee) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.,
disability, leave of absence, or layoff, etc.)
(fff) Special Basic After-Tax Contributions: After-tax
Contributions which are made under subsection
3.5(b)(iii).
(ggg) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(hhh) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(iii) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(jjj) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(kkk) Total and Permanent Disability: A condition arising
out of any injury or disease which the Committee
determines is permanent and prevents a Participant from
engaging in any occupation with the Corporation, a
Subsidiary or an Equity Company commensurate with his
education, training and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(lll) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(mmm) Trust: The Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan Trust pursuant to
the trust agreement provided for in Article V.
(nnn) Trustee: The trustee under the Trust.
(ooo) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan, and any Employee contributions, as
defined in Code Section 401(m) and the regulations
thereunder, contributed prior to April 1, 1990, on
account of which a Company Matching Contribution was
made to this Plan on behalf of a Participant who was
employed prior to April 1, 1989.
(ppp) Valuation Date: The last day of each month.
(qqq) Withdrawal Year: As defined in Section 8.1.
(rrr) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employees for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic After-Tax Contributions (including amounts
recharacterized as Basic After-Tax Contributions
under subsection 3.5(b)(iii)), and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year (but only
to the extent that such Contributions and Company
Matching Contributions are not considered for
purposes of Section 2.1(c) hereof), together with
qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Actual Deferral Percentage: A percentage which, for a
specified group of Eligible Employees for a Plan Year,
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of 401(k) Contributions remitted to the
Trustee on behalf of each such Eligible Employee
for such Plan Year (and, to the extent determined
appropriate by the Committee, such other
Contributions and Company Matching Contributions as
may be used to determine the actual deferral
percentage under Code section 401(k) and
regulations thereunder), to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the 401(k) Contributions
and Total Compensation of such Highly Compensated
Eligible Employee shall include the 401(k) Contributions
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(d) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(e) All Cash Distribution: As defined in subsection 7.3(c).
(f) All Stock Distribution: As defined in subsection
7.3(a).
(g) Base Salary Rate: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of regular earnings
while a Participant. Base Salary Rate shall be
determined before 401(k) Contributions pursuant to
subsection 3.2(a), and any elective salary reduction
contributions pursuant to Code Section 125, are
deducted. With respect to any Eligible Employee on a
foreign assignment, such Eligible Employee's Base Salary
Rate shall disregard any adjustment which is made to
such Eligible Employee's salary as a result of such
foreign assignment. Notwithstanding the foregoing, the
amount of any Eligible Employee's compensation which is
taken into account for purposes of determining such
Eligible Employee's Base Salary Rate under the Plan
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(h) Basic After-Tax Contributions: 401(k) Contributions in
excess of the limitation under subsection 3.5(a)(i)
which are recharacterized under subsection 3.5(b)(iii),
Special Basic-After Tax Contributions, and any other
employee contributions, as defined in Code Section
401(m) and the regulations thereunder on account of
which a Company Matching Contribution was made to this
Plan on behalf of the Participant, excluding any such
employee contributions contributed prior to April 1,
1990, made on behalf of a Participant who was employed
prior to April 1, 1989.
(i) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation, or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(j) Board: The Board of Directors of the Corporation.
(k) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(l) Commissioner: The Commissioner of the Internal Revenue
Service.
(m) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(n) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(o) Contributions: Amounts deposited under the Plan by or
on behalf of Participants as provided in Article III.
(p) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(q) Corporation Stock: The common stock of the Corporation.
(r) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(s) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(t) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(u) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(v) Employee: A person employed by an Employer.
(w) Employee Accounts: Those Accounts specified in
subsections (x), (y), (z) and (aa) of this Section 2.1.
(x) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(y) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(z) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(aa) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(bb) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(cc) Employer Accounts: Those Accounts specified in
subsections (dd), (ee), (ff) and (gg) of this Section
2.1.
(dd) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(ee) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ff) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(gg) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(hh) Entry Date: The first day of each month.
(ii) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(jj) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(kk) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) 401(k) Contributions: Contributions made by Employers
on behalf of Participants under subsection 3.2(a) on or
after April 1, 1983 that are considered deferred within
the meaning of Code section 401(k) and regulations
thereunder.
(mm) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(nn) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(oo) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(pp) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(qq) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(rr) Matured Withdrawal Year: As defined in Section 8.2.
(ss) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(tt) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(uu) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(vv) Optional Annuity Distribution: As defined in subsection
7.3(c).
[Section 2.1(vv) amended as follows effective January 1, 1995:]
(vv) Reserved.
(ww) Optional Installment Distribution: As defined in
subsection 7.3(d).
[Section 2.1(ww) amended as follows effective January 1, 1995:]
(ww) Reserved.
(xx) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1. He remains a
Participant until all of his Accounts have been
distributed pursuant to the Plan.
(yy) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated are shown in Appendix A.
(zz) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(aaa) Regular Basic After-Tax Contributions: After-tax
Contributions made through regular payroll deductions
under subsection 3.5(a)(ii).
(bbb) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(ccc) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(ddd) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in subsection 8.6(a) for
purposes of Article VIII.
(eee) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.,
disability, leave of absence, or layoff, etc.)
(fff) Special Basic After-Tax Contributions: After-tax
Contributions which are made under subsection
3.5(b)(ii).
(ggg) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(hhh) Stock and Cash Distribution: As defined in subsection
7.3(b).
(iii) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(jjj) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(kkk) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(lll) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service
(other than temporary absence on military
leave) if the Participant does not return to
active employment with the Corporation, a
Subsidiary or an Equity Company at the end of
his military service,
(ii) any condition incurred as a result of or
incidental to a felonious act perpetrated by
the Participant, and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-
inflicted injury.
(mmm) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(nnn) Trust: The Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan Trust pursuant to
the trust agreement provided for in Article V.
(ooo) Trustee: The trustee under the Trust.
(ppp) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan, and any Employee contributions, as
defined in Code Section 401(m) and the regulations
thereunder, contributed prior to April 1, 1990, on
account of which a Company Matching Contribution was
made to this Plan on behalf of a Participant who was
employed prior to April 1, 1989.
(qqq) Valuation Date: The last day of each month.
(rrr) Withdrawal Year: As defined in Section 8.1.
(sss) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE III
PARTICIPATION, CONTRIBUTIONS, AND ALLOCATIONS
3.1 Election to Participate. An Eligible Employee's election to
participate in the Plan shall, if given on Timely Notice,
(i) be effective as of the first Entry Date following his
election, and
(ii) remain in effect as a valid election to participate for
each successive Plan Year.
An election to participate by an Eligible Employee who,
immediately prior to becoming an Eligible Employee, was a
participant under the Kimberly-Clark Corporation Hourly
Employees Incentive Investment Plan shall be effective as
soon as administratively feasible upon exercising his
election.
3.2 Amount of Contributions by and on behalf of Participants.
(a) 401(k) Contributions. During each Plan Year, 401(k)
Contributions shall be made on behalf of a Participant
by his Employer for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 2%, 3%,
4%, 5% or 6% of his Base Salary Rate.
401(k) Contributions shall be deducted from a
Participant's compensation. An election under this
subsection shall remain in effect for so long as a
Participant is eligible to make 401(k) Contributions or,
if earlier, until changed by a Participant. On Timely
Notice, a Participant may change his election effective
as of the first day of any month.
[The following replaces section 3.2(a) effective January 1, 1995:]
(a) 401(k) Contributions. During each Plan Year, 401(k)
Contributions shall be made on behalf of a Participant
by his Employer for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 1%, 2%,
3%, 4%, 5% or 6% of his Base Salary Rate.
401(k) Contributions shall be deducted from a
Participant's compensation. An election under this
subsection shall remain in effect for so long as a
Participant is eligible to make 401(k) Contributions or,
if earlier, until changed by a Participant. On Timely
Notice, a Participant may change his election effective
as of the first day of any month.
(b) Regular Unrestricted After-Tax Contributions.
(i) A Participant may elect on Timely Notice to make
Regular Unrestricted After-Tax Contributions to his
Account in any whole percentage equal to an amount
which is not less than 2% of his Base Salary Rate
and not more than 10% of his Base Salary Rate.
(ii) An election to make Regular Unrestricted After-Tax
Contributions by regular payroll deduction shall
remain in effect for so long as a Participant is
eligible to make Regular Unrestricted After-Tax
Contributions or, if earlier, until changed by a
Participant. A Participant may change such
election on Timely Notice effective as of the first
day of any month.
(iii) Regular Unrestricted After-Tax Contributions will
not be taken into account in determining the amount
of Company Matching Contributions made on behalf of
Participants.
(c) Special Unrestricted After-Tax Contributions. Once each
Plan Year a Participant may elect to make a Special
Unrestricted After-Tax Contribution in excess of the
amount elected under subsection 3.2(b)(i) in an amount
(i) which is elected by him on Timely Notice,
(ii) which, in the case of a Special Unrestricted After-
Tax Contribution, when added to the total of the
Regular Unrestricted After-Tax Contributions made
by the Participant to date in the Plan Year, would
not exceed 10% of his Base Salary Rate for those
periods to date in such Plan Year during which
401(k) Contributions, Regular Basic After-Tax
Contributions or Regular Unrestricted After-Tax
Contributions have been made;
(iii) which shall only be made in cash; and
(iv) which, in the case of Special Unrestricted After-
Tax Contributions, will not be taken into account
in determining the amount of Company Matching
Contributions made on behalf of the Participant.
3.3 General Limitation. Notwithstanding any other provision of
this Article III, no Contribution shall be made to the Plan
which would cause the Plan to fail to meet the requirements
for exemption from tax or to violate any provisions of the
Code.
3.4 Allocation of Contributions by and on behalf of Participants.
401(k) Contributions and Unrestricted After-Tax
Contributions. On Timely Notice, a Participant shall elect
to allocate in whole multiples of 1% all of the 401(k)
Contributions and Unrestricted After-Tax Contributions to be
made on his behalf during a Plan Year to one or more of
(i) the Government Fund,
(ii) the Diversified Fund,
(iii) the Fixed Income Fund, or
(iv) the K-C Stock Fund.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice, a
Participant may change his election effective as of the first
day of any month.
3.5 Limitations on 401(k) Contributions.
(a) Overall Limitation.
(i) Notwithstanding any provision of the Plan to the
contrary, 401(k) Contributions made on behalf of a
Participant by his Employer for deposit to his
Account shall not exceed $7,000 (or such greater
amount as permitted under applicable regulations to
reflect cost-of-living increases) in any taxable
year of the Participant.
(ii) 401(k) Contributions made in excess of the amount
permitted in (a)(i) of this Section (or, if less,
their Current Market Value on the date of the
deposit thereof pursuant to this subsection) shall
be deposited to the Participant's Account as a
Basic After-Tax Contribution by such Participant.
(iii) Basic After-Tax Contributions deposited to a
Participant's Account pursuant to (ii) above or
subsection 3.2(c) will be allocated to the Plan
funds in the same manner as 401(k) Contributions
made on behalf of the Participant.
(b) Limitations on Actual Deferral Percentage.
(i) In any Plan Year in which the Actual Deferral
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Deferral Percentage of all other
Eligible Employees multiplied by 1.25, or
(B) the lesser of (I) 2 percent plus the Actual
Deferral Percentage of all other Eligible
Employees or (II) the Actual Deferral
Percentage of all other Eligible Employees
multiplied by 2.0,
the deferral rate under subsection 3.2(a) of those
Highly Compensated Eligible Employees shall be
reduced (in whole or less than whole percentages)
in descending order by rate of deferral elected
until the Actual Deferral Percentage for the group
of Highly Compensated Eligible Employees is not
more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) In order to prevent the multiple use of the
alternative limitations described in subsections
3.5(b)(i)(B) and 4.4(a)(i)(B), the following
provisions shall apply. If the Actual Deferral
Percentage test in subsection 3.5(b)(i) is
satisfied using subsection 3.5(b)(i)(B), the Actual
Contribution Percentage test in subsection
4.4(a)(i) is satisfied using subsection
4.4(a)(i)(B), and the combined Actual Deferral
Percentage and Actual Contribution Percentage
exceeds the greater of:
(A) the sum of: (I) the greater of the Actual
Deferral Percentage or the Actual Contribu-
tion Percentage for Eligible Employees other
than Highly Compensated Eligible Employees
multiplied by 1.25, and (II) 2 percent plus
the lesser of the Actual Deferral Percentage
or the Actual Contribution Percentage for
Eligible Employees other than Highly
Compensated Eligible Employees (but not more
than the lesser of the Actual Deferral
Percentage or Actual Contribution Percentage
for Eligible Employees other than Highly
Compensated Eligible Employees multiplied by
2.0), or
(B) the sum of: (I) the lesser of the Actual
Deferral Percentage or the Actual Contribu-
tion Percentage for Eligible Employees other
than Highly Compensated Eligible Employees
multiplied by 1.25, and (II) 2 percent plus
the greater of the Actual Deferral Percentage
or the Actual Contribution Percentage for
Eligible Employees other than Highly
Compensated Eligible Employees (but not more
than the greater of the Actual Deferral
Percentage or Actual Contribution Percentage
for Eligible Employees other than Highly
Compensated Eligible Employees multiplied by
2.0),
then the deferral rate under subsection 3.2(a) of
those Highly Compensated Eligible Employees shall
be reduced in accordance with subsection 3.5(b)(i)
or the contribution rate of those Highly
Compensated Eligible Employees shall be reduced in
accordance with subsection 4.4(a)(i), or both as
determined by the Committee, so that there is no
multiple use of the alternative limitation, as
described in regulations under Code section 401(m).
In lieu of the reduction described above, the
Employer may make qualified nonelective
contributions (pursuant to the regulations under
Code sections 401(k) and 401(m)) to be allocated
only to the Accounts of Participants who are not
Highly Compensated Eligible Employees.
Any excess contribution resulting from the required
reduction described above shall be corrected in
accordance with subsection 3.5(b)(iii). Any such
excess aggregate contribution resulting from
required reduction shall be corrected in accordance
with subsection 4.4(a)(iii).
(iii) 401(k) Contributions actually made in excess of the
amount permitted under (b)(i) of this Section shall
be recharacterized as Basic After-Tax
Contributions. Such Contributions (or, if less,
their Current Market Value on the date of the
deposit thereof pursuant to this subsection) shall
be deposited to the Participant's Account as a
Basic After-Tax Contribution by such Participant.
(c) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of 401(k) Contributions in a manner that prevents
contributions in excess of the limit set forth in
subsection 3.5(b) above.
3.6 Suspension of All Contributions. On Timely Notice and
notwithstanding the provisions of Section 3.2, a Participant
may elect to suspend, effective reasonably soon after such
notice is given as established by Committee rule, all of his
Contributions. On Timely Notice a Participant may elect to
resume Contributions as of any Entry Date, provided, however,
that any such suspension must be for a period of not less
than three months.
A Participant's Contributions shall be automatically
suspended commencing with and continuing throughout any
period during which he fails to qualify as an Eligible
Employee. On Timely Notice upon requalifying as an Eligible
Employee a Participant may elect to make Contributions to his
Accounts as soon as administratively feasible.
3.7 Payment of Contributions to Trustee. The Employers shall
contribute or remit to the Trustee as soon as practicable
after the end of each month the amounts deducted or withheld
from the Participants' compensation during the month as
Contributions under the Plan.
3.8 Reallocation of Participant's Accounts. A Participant who
has remained a Participant for at least three months may on
Timely Notice elect to reallocate, effective as of the first
Valuation Date following his election, all or any whole
percentage portion of any of his Employee Accounts or
Employer Accounts or both, provided he has not elected a
reallocation within the preceding three months; provided,
however, that a three month period that begins at the end of
a Plan Year shall not be more than ninety (90) days.
3.9 Redeposits and Restored Amounts.
(a) Notwithstanding any provision in this Plan to the
contrary, on Timely Notice, an Employee who has
forfeited all or a portion of his Employer Accounts,
other than as a result of a distribution from the 401(k)
Contribution Section of his Employee Accounts, may,
within 5 years of the date of the distribution or
withdrawal which caused such forfeiture, redeposit such
distribution or withdrawal, and upon such redeposit, the
amount of the forfeiture associated with the redeposit
shall be restored to the Employee's Employer Stock
Account (and to the Withdrawal Year) from which it was
forfeited. Redeposits shall be allocated to the Plan
funds in the same manner as 401(k) Contributions made on
behalf of the Participant. For an Employee hired prior
to April 1, 1989, redeposits shall be made on a
Withdrawal Year by Withdrawal Year basis, beginning with
the most remotely ended Withdrawal Year, and the amount
redeposited for any Withdrawal Year shall be equal to
the amount distributed or withdrawn which caused the
forfeiture for that Withdrawal Year.
For an Employee hired after March 31, 1989, the amount
redeposited shall be equal to the total amount
distributed or withdrawn which caused the forfeiture.
(b) No redeposit of such a withdrawal or distribution shall
be permitted if, coincident with or subsequent to the
forfeiture associated with that withdrawal or
distribution, an Employee incurs 5 consecutive One-Year
Periods of Severance. For Plan Years prior to April 1,
1989, and for purposes of this Section 3.9 only, an
Employee incurs a One-Year Period of Severance if he is
not an Employee on the last day of a Plan Year.
(c) Where applicable, if an Employee receives such a
distribution or makes such a withdrawal that results in
a forfeiture, and if such Employee does not make a
redeposit of such amount within the same Plan Year, any
Plan Year between the Plan Year of distribution or
withdrawal and the Plan Year of redeposit (including the
Plan Year of distribution or withdrawal but not
including the Plan Year of redeposit) shall not be
counted in determining when the restored amounts are
attributable to a Withdrawal Year or Matured Withdrawal
Years.
(d) Notwithstanding the preceding provision, a Participant
who is entitled to no portion of his Employer Account
upon termination of employment shall be deemed to have
received a distribution of zero dollars ($0) from such
account at the earliest date provided under Section 7.2.
(e) Any forfeiture from the 401(k) Contribution Section of
his Employer Accounts shall be restored in accordance
with the provisions of this Section 3.9 if the former
Employee returns to his employment with an Employer
prior to incurring 5 consecutive One-Year Periods of
Severance.
(f) Any forfeiture from the Basic After-Tax Contribution
section of his Employer Accounts under subsection 7.1(f)
shall be restored in accordance with the provisions of
this Section 3.9 if the Terminated Participant returns
to his employment with an Employer prior to incurring 5
consecutive One-Year Periods of Severance.
3.10 Source of and Interest in 401(k) Contributions. Anything in
this Plan to the contrary notwithstanding, 401(k)
Contributions shall be made by the Employers out of current
or accumulated earnings and profits, and the Employers shall
have no beneficial interest of any nature whatsoever in any
such Contributions after the same have been received by the
Trustee.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.3, Company
Matching Contributions for each Plan Year shall be 50% of (i)
401(k) Contributions and (ii) Basic After-Tax Contributions
for that Plan Year allocated to the K-C Stock Fund and 20% of
(i) 401(k) Contributions and (ii) Basic After-Tax
Contributions for that Plan Year allocated to the Government
Fund, the Diversified Fund or the Fixed Income Fund.
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.8 or the recharacterization of Deposits pursuant
to subsection 3.5(b)(iii), and no Company Matching
Contributions shall be made with respect to Participants'
Unrestricted After-Tax Contributions.
4.2 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are deducted or withheld for payment
to the Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.3 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if, in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.4 Limitations on Company Matching Contributions, Unrestricted
After-Tax Contributions, and Basic After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(b) and
(c), Section 3.5 with respect to Basic After-Tax
Contributions, and Section 4.1 of those Highly
Compensated Eligible Employees shall be reduced (in
whole or less than whole percentages) in descending
order until the Actual Contribution Percentage for
the group of Highly Compensated Eligible Employees
is not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) In order to prevent the multiple use of the
alternative limitations described in subsections
3.5(b)(i)(B) and 4.4(a)(i)(B), the provisions of
subsection 3.5(b)(ii) shall apply.
(iii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.4(a)(i) shall be determined in the
manner set forth in subsection 4.4(a)(iv).
(iv) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions Sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
Sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.4(a)(i)
above.
ARTICLE V
TRUSTEE AND TRUST AGREEMENT
5.1 The Corporation shall enter into a trust agreement with a
person or corporation selected by the Board to act as Trustee
of Contributions and Company Matching Contributions. The
Trustee shall receive all Contributions and all Company
Matching Contributions and shall hold, manage, administer,
and invest the same, reinvest any income, and, in accordance
with instructions and directions of the Committee subject to
the Plan, make distributions.
The trust agreement shall be in such form and contain such
provisions as the Board may deem necessary and appropriate to
effectuate the purposes of the Plan and to qualify the Plan
and the Trust under the Code. Upon the written request of an
Eligible Employee, a copy of the trust agreement shall be
made available for his inspection.
The Board may, from time to time, remove the Trustee or any
successor Trustee at any time and any such Trustee or any
successor Trustee may resign. The Board shall, upon removal
or resignation of a Trustee, appoint a successor Trustee.
The Trustee's accounts, books, and records relating to the
Trust may be audited annually by auditors selected by the
Board.
The Trustee's fee shall be paid by the Corporation but until
so paid shall constitute a charge upon the Trust. Brokerage
fees, asset management fees, investment management fees and
other direct costs of investment and taxes (including
interest and penalties) shall be paid by the Trustee out of
the funds of the Trust to which such costs are attributable,
unless paid by the Corporation in its discretion.
ARTICLE VI
INVESTMENT, PARTICIPANT'S ACCOUNTS, AND VOTING OF STOCK
6.1 Investment of Contributions.
(a) A Participant's Contributions and Contributions made on
his behalf during each Plan Year shall be invested in
the various funds in accordance with the Participant's
allocations under Section 3.4. A Participant's interest
arising from his reallocation for prior Plan Years shall
be invested in the various funds in accordance with the
Participant's directions under Section 3.8. Company
Matching Contributions during each Plan Year shall be
invested in the K-C Stock Fund. All such investments
and gains or losses related thereto shall be allocated
to each Participant's Accounts pursuant to the
provisions of Section 6.2.
(b) The Committee shall designate Participant's
Contributions and Company Matching Contributions for
payment to the Trustee for investment, and Employee
Accounts and Employer Accounts for reallocation in
accordance with subsection 6.1(a), and shall advise the
Trustee of such designation.
6.2 Participant's Accounts.
(a) Establishment of Accounts. Each Participant shall have
established and maintained for him separate Accounts
which, depending upon the allocation and reallocation
options he has selected, shall consist of Employee
Accounts and Employer Accounts in one or more of the
Government Fund, the Diversified Fund, the Fixed Income
Fund, and the K-C Stock Fund. Each such Employee
Account shall be subdivided into a Basic After-Tax
Contributions Section, a 401(k) Contributions Section,
and an Unrestricted After-Tax Contribution Section.
Each such Employer Account shall be subdivided into
subsections corresponding to the Sections of Employee
Accounts, other than the Unrestricted After-Tax
Contribution Section.
As soon as practicable following the end of each Plan
Year, the Committee will cause an annual statement to be
prepared for each Participant which will reflect the
status of the Participant's Accounts in such form as
shall be prescribed by the Committee.
(b) Separation of Accounts. Each Participant's Accounts
shall be further separated and maintained as Withdrawal
Years and Matured Withdrawal Years as set forth in
Sections 8.1 and 8.2.
(c) Crediting of Accounts. As of the close of business on
each Valuation Date the designated Accounts of each
Participant shall be appropriately credited with the
amounts of his Contributions and Contributions made on
his behalf, or the reallocation of his other Accounts,
if any, and his Employer Stock Account shall be credited
with the amount of any Company Matching Contributions
with respect to him. All such Contributions,
reallocations and Company Matching Contributions with
respect to any month shall be considered as having been
made on the Valuation Date but subsequent to the
valuation for such month provided for in subsection
6.2(d).
(d) Valuation of Accounts. Each Participant's Accounts
shall be valued and adjusted monthly to preserve for
each Participant his proportionate interest in the
related funds. As of each Valuation Date each of the
Accounts of each Participant shall be adjusted to
reflect the effect of income, collected and accrued,
realized and unrealized profits and losses, expenses and
all other transactions with respect to the related fund
as follows:
(i) The Current Market Value of the assets held in each
of the funds shall be determined by the Trustee,
and
(ii) The separate balances provided for in subsection
6.2(b) of each Participant's Account under each of
the related funds shall be adjusted by multiplying
by the ratio that the Current Market Value of such
fund as determined under subsection 6.2(d)(i) bears
to the aggregate of the Account balances under such
fund.
6.3 Stock Rights, Stock Splits and Stock Dividends. A
Participant shall have no right of request, direction or
demand upon the Committee or the Trustee to exercise in his
behalf rights to purchase shares of Corporation Stock or
other securities of the Corporation. The Trustee, at the
direction of the Committee, shall exercise or sell any rights
to purchase shares of Corporation Stock appertaining to
shares of such stock held by the Trustee and shall sell at
the direction of the Committee any rights to purchase other
securities of the Corporation appertaining to shares of
Corporation Stock held by the Trustee. The Accounts of
Participants shall be appropriately credited. Shares of
Corporation Stock received by the Trustee by reason of a
stock split or a stock dividend shall be appropriately
allocated to the Accounts of the Participants.
6.4 Voting of Corporation Stock. A Participant (or in the event
of his death, his Beneficiary) may direct the voting at each
annual meeting and at each special meeting of the
stockholders of the Corporation of that number of whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding the record date for such meeting. Each such
Participant (or Beneficiary) will be provided with copies of
pertinent proxy solicitation material together with a request
for his confidential instructions as to how such shares are
to be voted. The Committee shall direct the Trustee to vote
such shares in accordance with such instructions and shall
also direct the Trustee how to vote any shares of Corporation
Stock at any meeting for which it has not received, or is not
subject to receiving, such voting instructions.
6.5 Tender Offers. A Participant (or in the event of his death,
his Beneficiary) may direct the Trustee in writing how to
respond to a tender or exchange offer for any or all whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding such offer. The Committee shall notify each
Participant (or Beneficiary) and exert its best efforts to
timely distribute or cause to be distributed to him such
information as will be distributed to stockholders of the
Corporation in connection with any such tender or exchange
offer. Upon receipt of such instructions, the Trustee shall
tender such shares of Corporation Stock as and to the extent
so instructed. If the Trustee shall not receive instructions
from a Participant (or Beneficiary) regarding any such tender
or exchange offer for such shares of Corporation Stock (or
shall receive instructions not to tender or exchange such
shares), the Trustee shall have no discretion in such matter
and shall take no action with respect thereto. With respect
to shares of Corporation Stock in the K-C Stock Fund for
which the Trustee is not subject to receiving such
instructions, however, the Trustee shall tender such shares
in the same ratio as the number of shares for which it
receives instructions to tender bears to the total number of
shares for which it is subject to receiving instructions, and
shall have no discretion in such matter and shall take no
action with respect thereto other than as specifically
provided in this sentence.
ARTICLE VII
DISTRIBUTION OF ACCOUNTS
7.1 Accounts to be Distributed.
(a) Termination On or After Attainment of Age 55 or Upon
Disability. If a Participant's employment with an
Employer is terminated on or after his attainment of age
55, or if his employment is terminated upon his Total
and Permanent Disability, he shall be fully vested in
his Accounts and shall be entitled to receive a
distribution of the entire amount then in his Accounts
in accordance with Section 7.4.
(b) Termination Upon Death. In the event that the
termination of employment of a Participant is caused by
his death, or a Terminated Participant dies prior to the
first day on which such Terminated Participant's
Accounts are payable, the entire amount then in his
Accounts shall be paid to his Beneficiary in accordance
with Section 7.4 after receipt by the Committee of
acceptable proof of death.
(c) Termination As a Result of Group Termination. In the
event that the termination of employment of a
Participant is caused by reason of his status as a
member of a group involved in a Group Termination, he
shall be entitled to receive a distribution of the
entire amount then in his Accounts in accordance with
Section 7.4, unless action is taken pursuant to the Plan
to segregate the Accounts of all the Participants in
such group from the Trust and arrange for a transfer to
or a merger with a qualified successor plan or trust
with respect thereto.
(d) Termination for Other Reasons. Effective April 1, 1989,
if a Participant's employment with an Employer is
terminated for any other reason, the Participant shall
be entitled to the entire amount in his Employee
Accounts and a portion of his Employer Accounts as
determined in accordance with the following schedule:
Vested Forfeited
Years of Service Percentage Percentage
Less than 5 0% 100%
5 or more 100% 0%
provided, however, that for an Employee hired prior to
April 1, 1989, the above provision shall apply only to
the extent that the vested amount of the Participant's
Employer Accounts computed in accordance with the above
provision is not less than the Vested Section of the
Participant's Employer Accounts computed under the
provisions of the Plan in effect as of March 31, 1989.
In the event that the termination of employment of a
Participant is caused by any reason other than the
Employee quits, is discharged, retires or dies, the
Participant will be deemed to have a 12 month period of
absence following the date of such termination of
employment, for purposes of determining the portion of
his Employer Accounts which such Participant shall be
entitled to receive in a distribution in accordance with
this subsection.
In the event that the Plan is amended to change the
vesting provisions set forth in this subsection 7.1(d)
above, a Participant with 3 or more years of Service may
elect to have the vested percentage of the Participant's
Employer Accounts determined pursuant to the vesting
provisions in effect prior to the amendment.
(e) Distribution Transfer in Certain Group Terminations. In
the event that a Participant is a member of a group
involved in a Group Termination and the circumstances
are such that in the opinion of the Committee all of the
involved Participant's Accounts should be segregated
from the Plan and Trust, and transferred to or merged
with a successor qualified plan and trust, the Committee
shall take such action as it may deem necessary to cause
such segregation and transfer or merger to occur. For
these purposes, the amounts to be transferred or merged
shall be determined as though all of the Participants
involved in such group had terminated their employment
by reason of attainment of age 55. In such event, those
individuals in such group shall not be entitled to
receive any distribution hereunder and all liabilities
of this Plan and of the Trust with respect to such
individuals shall be deemed fully discharged on the date
of such transfer or merger.
(f) Deferred Distributions. Notwithstanding anything in
this Article VII to the contrary, if the aggregate value
of the Accounts of any Participant exceeds $3500, an
immediate distribution shall not be made without the
consent of the Participant. A Participant who fails to
consent to a distribution under this subsection 7.1(f)
shall continue to participate as a Terminated
Participant and shall be entitled to a distribution of
his Employee Accounts and the vested percentage of his
Employer Accounts. Upon Timely Notice of request for
payment, the Terminated Participant's Employee Accounts
and the vested percentage of his Employer Accounts shall
be distributed in accordance with the provisions of
Section 7.4.
7.2 Settlement Date and Time of Distributions. Each
Participant's Settlement Date shall be the Valuation Date
coincident with or following the termination of his
employment or the Valuation Date following Timely Notice of
his request for payment, whichever is later. Notwithstanding
the foregoing, the Settlement Date for a Terminated
Participant shall be the earlier of the Valuation Date
following Timely Notice of his request for payment or the
Valuation Date following Timely Notice of the request for
payment due to his death. Any forfeiture with respect to the
Accounts of the Participant or Terminated Participant shall
be determined as of the Valuation Date coincident with or
following such Participant's or Terminated Participant's
termination of employment. Distribution of a Participant's
Accounts shall be made to him or to his Beneficiary in full
after the termination of his employment and within 60 days
following his Settlement Date, except in the case of an
Optional Annuity Distribution or an Optional Installment
Distribution.
[The following replaces section 7.2 effective January 1, 1995:]
7.2 Settlement Date and Time of Distributions. Each
Participant's Settlement Date shall be the Valuation Date
coincident with or following the termination of his
employment or the Valuation Date following Timely Notice of
his request for payment, whichever is later. Notwithstanding
the foregoing, the Settlement Date for a Terminated
Participant shall be the earlier of the Valuation Date
following Timely Notice of his request for payment or the
Valuation Date following Timely Notice of the request for
payment due to his death. Any forfeiture with respect to the
Accounts of the Participant or Terminated Participant shall
be determined as of the Valuation Date coincident with or
following such Participant's or Terminated Participant's
termination of employment. Distribution of a Participant's
Accounts shall be made to him or to his Beneficiary in full
after the termination of his employment and within 60 days
following his Settlement Date.
7.3 Certain Definitions Relating to Distributions and
Withdrawals.
(a) Lump Sum Distribution. A "Lump Sum Distribution" of a
Participant's Accounts means one distribution consisting
of
(i) the cash equivalent of the Current Market Value on
the Settlement Date of the Participant's Employee
Accounts, except his Employee Stock Account, and
the vested percentage of his Employer Accounts,
except his Employer Stock Account, and
(ii) full shares of Corporation Stock on the Settlement
Date, attributable to the Participant's Employee
Stock Account and to the vested percentage of his
Employer Stock Account, together with the cash
equivalent of the Current Market Value on the
Settlement Date of fractional shares of such stock
attributable to such Accounts, and
(iii) the cash equivalent of any other interest
attributable to the Participant's Accounts, except
the forfeited percentage of his Employer Accounts,
on the Settlement Date.
(b) Lump Sum Optional Distribution. A "Lump Sum Optional
Distribution" of a Participant's Accounts means the same
as a Lump Sum Distribution, as defined in subsection
7.3(a), except that clause (ii) in said subsection shall
be replaced by the following clause:
(ii) the cash equivalent of the Current Market Value as
of the Settlement Date of all the shares and
fractional shares of Corporation Stock attributable
to the Participant's Employee Stock Account and to
the vested percentage of his Employer Stock
Account.
(c) Optional Annuity Distribution. An "Optional Annuity
Distribution" of a Participant's Accounts means the
distribution, of a single premium, non-transferable
joint and survivor annuity policy, or any other form of
single premium, non-transferable annuity policy approved
under rules established by the Committee. If a joint
and survivor annuity is selected, the form of such
annuity shall be such that an amount is payable to the
Participant for his life, and upon his death, fifty
percent (50%) of such amount is payable to his surviving
spouse for the remainder of the spouse's life. If the
Participant shall receive a joint and survivor annuity,
the payments may not be based upon a contingency
extending beyond the life expectancy of the Participant
and the Participant's spouse; and if a single life
annuity is elected, the payments may not be based upon a
contingency extending beyond the life expectancy of the
Participant. If an annuity form of distribution is
elected, an annuity policy (containing further
provisions relating to payment and options which may be
elected by the Participant under rules established by
the Committee) shall be purchased by the Trustee (from a
life insurance company selected by the Committee) from
the cash equivalent of the Participant's Accounts, as of
the Settlement Date, valued as though such Accounts were
to be distributed as a Lump Sum Optional Distribution,
as defined in subsection 7.3(b). If the Committee or
the Trustee is unable to obtain the information required
by the life insurance company for the purchase of an
annuity policy, as described above, the Optional Annuity
Distribution shall be made directly from the
Participant's Accounts in such form as may be set forth
under rules established by the Committee. If the
Optional Annuity Distribution is being paid directly
from the Participant's Accounts as provided above, the
Participant, or in the case of a married Participant the
Participant with spousal consent may elect distribution
of his accounts in the form of either a Lump Sum
Distribution or a Lump Sum Optional Distribution in the
same manner as a Terminated Participant.
In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution of the
Participant's Accounts shall be in the form of a joint
and survivor annuity, as described above, under which
the survivor annuity is payable to such Participant's
spouse; unless, within the period 90 days prior to the
Settlement Date, (i) such spouse consents in writing to
the election of another form of annuity or the naming of
another person to receive the survivor annuity, and
acknowledges the effect of such election, and (ii) such
consent is witnessed by a notary public. No such
spousal consent need be furnished with respect to an
election, however, if the Committee determines that such
Participant's spouse cannot be located, or that such
consent is unobtainable for any other reason provided
under applicable regulations. For purposes of this
subsection 7.3(c), the term spouse shall mean the spouse
of a Participant as of his Settlement Date.
(d) Optional Installment Distribution. An "Optional
Installment Distribution" of a Participant's Accounts
means that a Participant has elected prior to his
Settlement Date to have the cash equivalent of all of
his Accounts, as at the Settlement Date, valued as
though such Accounts were to be distributed as a Lump
Sum Optional Distribution as defined in subsection
7.3(b), applied to the purchase of a contract which
provides:
(i) for the payment of the cash equivalent of the
Participant's Accounts, plus interest, in equal
monthly installments, commencing with the end of
either the second or twelfth month following his
Settlement Date and continuing for either 60 or 120
months, as the Participant shall elect on Timely
Notice prior to his Settlement Date;
(ii) that if the Participant dies prior to receiving all
of the payments to which he is entitled under the
contract, an amount equal to the sum of all such
remaining payments shall be distributed to his
Beneficiary in one cash payment as soon as
practicable.
[The following replaces section 7.3 effective September 1, 1994:]
7.3 Certain Definitions Relating to Distributions and
Withdrawals.
(a) All Stock Distribution. An "All Stock Distribution" of
a Participant's Accounts means one distribution
consisting of full shares of Corporation Stock on the
Settlement Date, attributable to the Participant's
Employee Accounts and to the vested percentage of his
Employer Accounts, together with the cash equivalent of
the Current Market Value on the Settlement Date of
fractional shares of such stock attributable to such
Accounts.
(b) Stock and Cash Distribution. A "Stock and Cash
Distribution" of a Participant's Accounts means one
distribution consisting of
(i) the cash equivalent of the Current Market Value on
the Settlement Date of the Participant's Employee
Accounts, except his Employee Stock Account, and
the vested percentage of his Employer Accounts,
except his Employer Stock Account, and
(ii) full shares of Corporation Stock on the Settlement
Date, attributable to the Participant's Employee
Stock Account and to the vested percentage of his
Employer Stock Account, together with the cash
equivalent of the Current Market Value on the
Settlement Date of fractional shares of such stock
attributable to such Accounts, and
(iii) the cash equivalent of any other interest
attributable to the Participant's Accounts, except
the forfeited percentage of his Employer Accounts,
on the Settlement Date.
(c) All Cash Distribution. An "All Cash Distribution" of a
Participant's Accounts means the same as a Stock and
Cash Distribution, as defined in subsection 7.3(b),
except that clause (ii) in said subsection shall be
replaced by the following clause:
(ii) the cash equivalent of the Current Market Value as
of the Settlement Date of all the shares and
fractional shares of Corporation Stock attributable
to the Participant's Employee Stock Account and to
the vested percentage of his Employer Stock
Account.
(d) Optional Annuity Distribution. An "Optional Annuity
Distribution" of a Participant's Accounts means the
distribution, of a single premium, non-transferable
joint and survivor annuity policy, or any other form of
single premium, non-transferable annuity policy approved
under rules established by the Committee. If a joint
and survivor annuity is selected, the form of such
annuity shall be such that an amount is payable to the
Participant for his life, and upon his death, fifty
percent (50%) of such amount is payable to his surviving
spouse for the remainder of the spouse's life. If the
Participant shall receive a joint and survivor annuity,
the payments may not be based upon a contingency
extending beyond the life expectancy of the Participant
and the Participant's spouse; and if a single life
annuity is elected, the payments may not be based upon a
contingency extending beyond the life expectancy of the
Participant. If an annuity form of distribution is
elected, an annuity policy (containing further
provisions relating to payment and options which may be
elected by the Participant under rules established by
the Committee) shall be purchased by the Trustee (from a
life insurance company selected by the Committee) from
the cash equivalent of the Participant's Accounts, as of
the Settlement Date, valued as though such Accounts were
to be distributed as an All Cash Distribution, as
defined in subsection 7.3(c). If the Committee or the
Trustee is unable to obtain the information required by
the life insurance company for the purchase of an
annuity policy, as described above, the Optional Annuity
Distribution shall be made directly from the
Participant's Accounts in such form as may be set forth
under rules established by the Committee. If the
Optional Annuity Distribution is being paid directly
from the Participant's Accounts as provided above, the
Participant, or in the case of a married Participant the
Participant with spousal consent, may elect distribution
of his accounts in the form of an All Stock
Distribution, a Stock and Cash Distribution or an All
Cash Distribution in the same manner as a Terminated
Participant.
In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution of the
Participant's Accounts shall be in the form of a joint
and survivor annuity, as described above, under which
the survivor annuity is payable to such Participant's
spouse; unless, within the period 90 days prior to the
Settlement Date, (i) such spouse consents in writing to
the election of another form of annuity or the naming of
another person to receive the survivor annuity, and
acknowledges the effect of such election, and (ii) such
consent is witnessed by a notary public. No such
spousal consent need be furnished with respect to an
election, however, if the Committee determines that such
Participant's spouse cannot be located, or that such
consent is unobtainable for any other reason provided
under applicable regulations. For purposes of this
subsection 7.3(d), the term spouse shall mean the spouse
of a Participant as of his Settlement Date.
(e) Optional Installment Distribution. An "Optional
Installment Distribution" of a Participant's Accounts
means that a Participant has elected prior to his
Settlement Date to have the cash equivalent of all of
his Accounts, as at the Settlement Date, valued as
though such Accounts were to be distributed as an All
Cash Distribution as defined in subsection 7.3(c),
applied to the purchase of a contract which provides:
(i) for the payment of the cash equivalent of the
Participant's Accounts, plus interest, in equal
monthly installments, commencing with the end of
either the second or twelfth month following his
Settlement Date and continuing for either 60 or 120
months, as the Participant shall elect on Timely
Notice prior to his Settlement Date;
(ii) that if the Participant dies prior to receiving all
of the payments to which he is entitled under the
contract, an amount equal to the sum of all such
remaining payments shall be distributed to his
Beneficiary in one cash payment as soon as
practicable.
[The following replaces section 7.3 effective January 1, 1995:]
7.3 Certain Definitions Relating to Distributions and
Withdrawals.
(a) All Stock Distribution. An "All Stock Distribution" of
a Participant's Accounts means one distribution
consisting of full shares of Corporation Stock on the
Settlement Date, attributable to the Participant's
Employee Accounts and to the vested percentage of his
Employer Accounts, together with the cash equivalent of
the Current Market Value on the Settlement Date of
fractional shares of such stock attributable to such
Accounts.
(b) Stock and Cash Distribution. A "Stock and Cash
Distribution" of a Participant's Accounts means one
distribution consisting of
(i) the cash equivalent of the Current Market Value on
the Settlement Date of the Participant's Employee
Accounts, except his Employee Stock Account, and
the vested percentage of his Employer Accounts,
except his Employer Stock Account, and
(ii) full shares of Corporation Stock on the Settlement
Date, attributable to the Participant's Employee
Stock Account and to the vested percentage of his
Employer Stock Account, together with the cash
equivalent of the Current Market Value on the
Settlement Date of fractional shares of such stock
attributable to such Accounts, and
(iii) the cash equivalent of any other interest
attributable to the Participant's Accounts, except
the forfeited percentage of his Employer Accounts,
on the Settlement Date.
(c) All Cash Distribution. An "All Cash Distribution" of a
Participant's Accounts means the same as a Stock and
Cash Distribution, as defined in subsection 7.3(b),
except that clause (ii) in said subsection shall be
replaced by the following clause:
(ii) the cash equivalent of the Current Market Value as
of the Settlement Date of all the shares and
fractional shares of Corporation Stock attributable
to the Participant's Employee Stock Account and to
the vested percentage of his Employer Stock
Account.
7.4 Methods of Distribution.
(a) Distribution by Reason of Death. The Beneficiary of a
Participant to which subsection 7.1(b) applies shall be
entitled to receive a distribution of such Participant's
Accounts in the form of either a Lump Sum Distribution,
a Lump Sum Optional Distribution, an Optional Annuity
Distribution, or an Optional Installment Distribution as
elected by the Participant in the appointment of his
Beneficiary. If no such election was made, such
distribution shall be in the form of either a Lump Sum
Distribution, a Lump Sum Optional Distribution, an
Optional Annuity Distribution, or an Optional
Installment Distribution as elected by the Beneficiary.
(b) Distribution Upon Termination of Employment for Reasons
Other than Death.
(i) A Participant who is entitled to receive a
distribution of his Accounts due to the termination
of his employment for any reason specified in
Section 7.1, except death, may on Timely Notice
elect to receive such distribution in the form of
either a Lump Sum Distribution, a Lump Sum Optional
Distribution, an Optional Annuity Distribution, or
an Optional Installment Distribution at any time.
In the event no such election is made, and the
Participant is married at the date of his
distribution, such distribution will be made in the
form of a joint and survivor annuity as described
in subsection 7.3(c).
(ii) In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution
shall be in the form of a joint and survivor
annuity as described in subsection 7.3(c), provided
the Participant's spouse consents thereto in
accordance with subsection 7.3(c). The Committee
shall, within a reasonable time prior to
commencement of benefits (but, in all events, no
less than 30 nor more than 90 days prior thereto)
furnish to such Participant a written explanation
of the terms and conditions of the joint and
survivor annuity and the financial effect upon a
Participant's benefit (in terms of dollars per
annuity payment) of making an election not to take
the joint and survivor annuity. An election by a
Participant entitled to such explanation under this
subsection not to take the joint and survivor
annuity described in this Article, or a change in
or revocation of any such election, may be made at
any time during the 90-day period prior to the date
benefits commence, as described in subsection
7.3(c).
(c) Small Distributions. Notwithstanding any provision of
this Section 7.4 to the contrary, if the aggregate value
of a Participant's Accounts does not exceed $3500, the
Committee shall direct the distribution of the Accounts
of any Participant as a Lump Sum Distribution or a Lump
Sum Optional Distribution, as elected by the Participant
or his Beneficiary prior to the Settlement Date. If no
earlier election is made, Timely Notice of a request for
payment shall be deemed to have been given two months
after termination of employment and such distribution
shall be in the form of a Lump Sum Optional
Distribution.
[The following replaces section 7.4 effective September 1, 1994:]
7.4 Methods of Distribution.
(a) Distribution by Reason of Death. The Beneficiary of a
Participant to which subsection 7.1(b) applies shall be
entitled to receive a distribution of such Participant's
Accounts in the form of either an All Stock
Distribution, a Stock and Cash Distribution, an All Cash
Distribution, an Optional Annuity Distribution, or an
Optional Installment Distribution as elected by the
Participant in the appointment of his Beneficiary. If
no such election was made, such distribution shall be in
the form of either an All Stock Distribution, a Stock
and Cash Distribution, an All Cash Distribution, an
Optional Annuity Distribution, or an Optional
Installment Distribution as elected by the Beneficiary.
(b) Distribution Upon Termination of Employment for Reasons
Other than Death.
(i) A Participant who is entitled to receive a
distribution of his Accounts due to the termination
of his employment for any reason specified in
Section 7.1, except death, may on Timely Notice
elect to receive such distribution in the form of
an All Stock Distribution, a Stock and Cash
Distribution, an All Cash Distribution, an Optional
Annuity Distribution, or an Optional Installment
Distribution at any time. In the event no such
election is made, and the Participant is married at
the date of his distribution, such distribution
will be made in the form of a joint and survivor
annuity as described in subsection 7.3(d).
(ii) In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution
shall be in the form of a joint and survivor
annuity as described in subsection 7.3(d), provided
the Participant's spouse consents thereto in
accordance with subsection 7.3(d). The Committee
shall, within a reasonable time prior to
commencement of benefits (but, in all events, no
less than 30 nor more than 90 days prior thereto)
furnish to such Participant a written explanation
of the terms and conditions of the joint and
survivor annuity and the financial effect upon a
Participant's benefit (in terms of dollars per
annuity payment) of making an election not to take
the joint and survivor annuity. An election by a
Participant entitled to such explanation under this
subsection not to take the joint and survivor
annuity described in this Article, or a change in
or revocation of any such election, may be made at
any time during the 90-day period prior to the date
benefits commence, as described in subsection
7.3(d).
(c) Small Distributions. Notwithstanding any provision of
this Section 7.4 to the contrary, if the aggregate value
of a Participant's Accounts does not exceed $3500, the
Committee shall direct the distribution of the Accounts
of any Participant as an All Stock Distribution, a Stock
and Cash Distribution or an All Cash Distribution, as
elected by the Participant or his Beneficiary prior to
the Settlement Date. If no earlier election is made,
Timely Notice of a request for payment shall be deemed
to have been given two months after termination of
employment and such distribution shall be in the form of
an All Cash Distribution.
[The following replaces section 7.4 effective January 1, 1995:]
7.4 Methods of Distribution.
(a) Distribution by Reason of Death. The Beneficiary of a
Participant to which subsection 7.1(b) applies shall be
entitled to receive a distribution of such Participant's
Accounts in the form of either an All Stock
Distribution, a Stock and Cash Distribution or an All
Cash Distribution as elected by the Participant in the
appointment of his Beneficiary. If no such election was
made, such distribution shall be in the form of either
an All Stock Distribution, a Stock and Cash Distribution
or an All Cash Distribution as elected by the
Beneficiary.
(b) Distribution Upon Termination of Employment for Reasons
Other than Death. A Participant who is entitled to
receive a distribution of his Accounts due to the
termination of his employment for any reason specified
in Section 7.1, except death, may on Timely Notice elect
to receive such distribution in the form of an All Stock
Distribution, a Stock and Cash Distribution or an All
Cash Distribution at any time.
(c) Small Distributions. Notwithstanding any provision of
this Section 7.4 to the contrary, if the aggregate value
of a Participant's Accounts does not exceed $3500, the
Committee shall direct the distribution of the Accounts
of any Participant as an All Stock Distribution, a Stock
and Cash Distribution or an All Cash Distribution as
elected by the Participant or his Beneficiary prior to
the Settlement Date. If no earlier election is made,
Timely Notice of a request for payment shall be deemed
to have been given two months after termination of
employment, and such distribution shall be in the form
of an All Cash Distribution.
7.5 Miscellaneous.
(a) For the purpose of the Plan, no termination of
employment will be deemed to have occurred in any
instance where the person involved remains in Service or
is reemployed by an Employer prior to his Settlement
Date.
(b) In the event of the death, prior to his receipt of a
distribution, of a Participant who at the time of his
death was entitled to receive distribution under
subsection 7.4(b) and elected to receive such
distribution in the form of a Lump Sum Distribution or a
Lump Sum Optional Distribution, or was entitled to
receive a distribution under subsection 7.4(c), and if
the Committee has notice of the Participant's death
prior to such distribution, then such distribution shall
be made to the Participant's Beneficiary by the same
method as it would have been made to the Participant but
for his death.
[The following replaces section 7.5 effective September 1, 1994:]
7.5 Miscellaneous.
(a) For the purpose of the Plan, no termination of
employment will be deemed to have occurred in any
instance where the person involved remains in Service or
is reemployed by an Employer prior to his Settlement
Date.
(b) In the event of the death, prior to his receipt of a
distribution, of a Participant who at the time of his
death was entitled to receive distribution under
subsection 7.4(b) and elected to receive such
distribution in the form of an All Stock Distribution, a
Stock and Cash Distribution, or an All Cash
Distribution, or was entitled to receive a distribution
under subsection 7.4(c), and if the Committee has notice
of the Participant's death prior to such distribution,
then such distribution shall be made to the
Participant's Beneficiary by the same method as it would
have been made to the Participant but for his death.
7.6 Required Distributions.
(a) Notwithstanding any provision of the Plan to the
contrary, a Participant's or Terminated Participant's
Accounts shall be distributed commencing no later than
the earlier of:
(i) April 1 of the calendar year following the year in
which the Participant or Terminated Participant
attains age 70-1/2, except to the extent that
Section 1121(d)(4) of the Tax Reform Act of 1986
provides otherwise, or
(ii) unless the Participant elects a later date (which
can be no later than the date specified in (i)
above), the 60th day after the latest of:
(A) the close of the Plan Year in which the
Participant attains age 65,
(B) the close of the Plan Year which includes the
date 10 years after the date the Participant
first commenced participating in the Plan, or
(C) the close of the Plan Year in which the
Participant terminated employment with his
Employer.
(b) All distributions from the Plan shall be made in
accordance with the requirements of Code section
401(a)(9) and the regulations thereunder, including the
minimum distribution incidental benefit requirements.
7.7 Unclaimed Benefits. During the time when a benefit hereunder
is payable to any Terminated Participant or, if deceased, his
Beneficiary, the Committee shall mail by registered or
certified mail to such Participant or Beneficiary, at his
last known address, a written demand for his then address, or
for satisfactory evidence of his continued life, or both. If
such information is not furnished to the Committee within 12
months from the mailing of such demand, then the Committee
may, under rules established by the Committee, in its sole
discretion, declare such benefit, or any unpaid portion
thereof, suspended, with the result that such unclaimed
benefit shall be treated as a forfeiture for the Plan Year
within which such 12-month period ends, but shall be subject
to restoration through an Employer Contribution if the lost
Participant or such Beneficiary later files a claim for such
benefit.
7.8 Reserved.
7.9 Karolton Envelope Benefit. Notwithstanding any other
provision of the Plan, if a Participant's employment with an
Employer is terminated, he shall be fully vested in his
Accounts and shall be entitled to receive a distribution of
the entire amount then in his Accounts in accordance with
Section 7.4. if such Participant meets all of the following
conditions:
(a) immediately prior to his termination of employment he
must have been an Employee of Karolton Envelope; and
(b) such termination of employment must be involuntary on
the part of the Participant, be caused solely by the
elimination of his job function with the Corporation due
to the sale of assets of Karolton Envelope under the
Assets Purchase Agreement entered into between the
Corporation and KECA Corporation dated October 29, 1993,
and such termination of employment must occur on the
Closing Date of such Assets Purchase Agreement.
7.10 Spenco Medical Corporation Benefit. Notwithstanding any
other provision of the Plan, a Participant shall be fully
vested in his Accounts and shall be entitled to receive a
distribution of the entire amount then in his Accounts in
accordance with Section 7.4. if such Participant is employed
by Spenco Medical Corporation on the Closing Date of the sale
of Spenco Medical Corporation under the Agreement and Plan of
Merger entered into between the Corporation and Spenco
Medical Corporation, SBS Enterprises, Inc., Spenco
Acquisition Corporation and Steven B. Smith, dated March 4,
1994. For purposes of this Section, a Participant described
in the preceding sentence shall be treated under Section 7.4
as if he terminated employment with an Employer for a reason
other than death on the Closing Date; provided, however, that
a distribution pursuant to this Section shall be delayed to
the extent required by the Internal Revenue Service under
section 401(k)(2)(B)(i)(I) of the Code.
7.11 Form of ESOP Benefit. Notwithstanding anything in the Plan
to the contrary but subject to the provisions of Sections 7.4
and 7.6, the form of benefit payment available from the K-C
Stock Fund to a Participant, unless the Participant elects
otherwise, shall be substantially equal periodic payments
(not less frequently than annually) over a period not longer
than the greater of (i) five (5) years, or (ii) in the case
of a Participant whose vested portion of his Accounts exceeds
$500,000 (as adjusted by legislation or for cost-of-living
increases), five (5) years plus one (1) additional year (not
exceeding five (5) additional years) for each $100,000 (or
fraction of $100,000) (as adjusted by legislation or for
cost-of-living increases) by which the vested portion of his
Accounts exceeds $500,000 (as adjusted by legislation or for
cost-of-living increases).
[The following replaces section 7.11 effective September 1, 1994:]
7.11 Form of ESOP Benefit. Notwithstanding anything in the Plan
to the contrary but subject to the provisions of Sections 7.4
and 7.6, the form of benefit payment available to a
Participant, unless the Participant elects otherwise, shall
be substantially equal periodic payments (not less frequently
than annually) over a period not longer than the greater of
(i) five (5) years, or (ii) in the case of a Participant
whose vested portion of his Accounts exceeds $500,000 (as
adjusted by legislation or for cost-of-living increases),
five (5) years plus one (1) additional year (not exceeding
five (5) additional years) for each $100,000 (or fraction of
$100,000) (as adjusted by legislation or for cost-of-living
increases) by which the vested portion of his Accounts
exceeds $500,000 (as adjusted by legislation or for cost-of-
living increases).
[The following replaces section 7.11 effective January 1, 1995:]
7.11 Form of ESOP Benefit. Notwithstanding anything in the Plan
to the contrary but subject to the provisions of Sections
7.4(c) and 7.6, the form of benefit payment available to a
Participant, unless the Participant elects otherwise, shall
be substantially equal periodic payments (not less frequently
than annually) over a period not longer than the greater of
(i) five (5) years, or (ii) in the case of a Participant
whose vested portion of his Accounts exceeds $500,000 (as
adjusted by legislation or for cost-of-living increases),
five (5) years plus one (1) additional year (not exceeding
five (5) additional years) for each $100,000 (or fraction of
$100,000) (as adjusted by legislation or for cost-of-living
increases) by which the vested portion of his Accounts
exceeds $500,000 (as adjusted by legislation or for cost-of-
living increases).
7.12 ESOP Dividend Distributions. Dividends paid to the Trust
that had dividend record dates during a Plan Year on
Corporation Stock allocated to a Participant's Accounts shall
be paid to that Participant, or if applicable, to his
Beneficiary, in the first quarter of the Plan Year following
the Plan Year in which the dividends' record dates occurred.
Notwithstanding the preceding sentence, in the last quarter
of each Plan Year, a Participant who is employed by an
Employer or an affiliate of an Employer at the time of an
election under this Section may elect to have 25%, 50%, 75%,
or all of such dividend payments remain in the Trust in lieu
of a distribution under this Section. Dividends retained in
the Trust under this Section shall be invested as directed by
the Participant under Section 3.8. Notwithstanding both the
dollar amount (if any) of any election under this Section and
the preceding provisions of this Section, the amount actually
paid under this Section shall not exceed the lesser of (i)
the electing Participant's share of the dividends subject to
such election and (ii) his balance in his Accounts at the
time of payment.
ARTICLE VIII
FORMATION OF WITHDRAWAL YEAR AND MATURED
WITHDRAWAL YEAR; WITHDRAWALS DURING EMPLOYMENT
8.1 Withdrawal Years. A Withdrawal Year shall be formed under
the Plan for the Company Matching Contributions made for each
Plan Year. Each Withdrawal Year shall be and continue to be
identified separately up to the first day of the Plan Year
commencing with the third anniversary of its conclusion.
8.2 Matured Withdrawal Years. A separately identified Matured
Withdrawal Year shall be formed under the Plan to include all
amounts held in the Participants' Employer Accounts as of the
first day of the Plan Year commencing with the third
anniversary of each Withdrawal Year.
8.3 Regular Withdrawals. A Participant, subject to the
conditions stated below, may make the following Regular
Withdrawals:
(a) Such amount as the Participant may elect from the
Unrestricted After-Tax Contribution Section of his
Accounts;
(b) Such amounts as the Participant may elect from the Basic
After-Tax Contribution Section of his Accounts; and
(c) Such amounts as a Participant who has at least 5 years
of Service or a Participant who was employed by Employer
prior to April 1, 1989, may elect from his Employer
Accounts for the Matured Withdrawal Years. Any
Participant not otherwise described above shall not be
eligible to make withdrawals from his Employer Accounts.
In the event of a Regular Withdrawal from the Basic After-
Tax Contribution section of a Participant's Accounts pursuant
to subsection 8.3(b), such Participant's Contributions under
the Plan shall be suspended for a period of 12 months
following such withdrawal.
8.4 Over Age 59-1/2 Withdrawals. A Participant who has attained
age 59-1/2 may withdraw such amounts as he may elect from the
401(k) Contributions Sections of his Accounts. In the event
of withdrawal pursuant to this Section 8.4 such Participant's
Contributions under the Plan shall be suspended for a period
of 12 months following such withdrawal.
8.5 Hardship Withdrawals.
(a) Upon the application of any Participant who has not
attained age 59 1/2, the Committee, in accordance with
its uniform nondiscriminatory rules, may permit such
Participant to withdraw all or a portion (subject to
subsection (b) below) of the amount in the 401(k)
Contribution Section of his Accounts if the Participant
is able to demonstrate financial hardship and provided,
however, that all amounts available as Regular
Withdrawals described in Section 8.3 shall first be
withdrawn. A Participant shall be considered to have
demonstrated financial hardship only if the Participant
demonstrates that the purpose of the withdrawal is to
meet his immediate and heavy financial needs, the amount
of the withdrawal does not exceed such financial needs,
and the amount of the withdrawal is not reasonably
available from other resources. A Participant making
application under this Section 8.5 shall have the burden
of demonstrating a financial hardship to the Committee,
and the Committee shall not permit withdrawal under this
subsection without first receiving such proof.
The Participant will be deemed to have demonstrated that
the purpose of the withdrawal is to meet his immediate
and heavy financial needs only if he represents that the
distribution is on account of:
(i) medical expenses (as described in Code section
213(d)) incurred by the Participant, his
spouse, or any of his dependents, or necessary
for such persons to obtain medical care;
(ii) the purchase (excluding mortgage payments) of
a principal residence for the Participant;
(iii) the payment of tuition and related educational
fees for the next 12 months of post-secondary
education for the Participant, his spouse,
children, or dependents;
(iv) payments necessary to prevent eviction from or
foreclosure on the Participant's principal
residence or the mortgage on that residence;
or
(v) any other condition determined by the
Committee pursuant to its uniform Committee
Rules to represent a financial hardship.
Moreover, the Participant will be deemed to have
demonstrated that the amount of the withdrawal is
unavailable from his other resources and in an amount
not in excess of that necessary to satisfy his immediate
and heavy financial needs only if each of the following
requirements is satisfied:
(i) the Participant represents that the
distribution is not in excess of the amount of
his immediate and heavy financial needs,
except that the withdrawal may include any
amounts necessary to pay any federal, state,
or local income taxes or penalties reasonably
anticipated to result from the withdrawal; and
(ii) the Participant has obtained all
distributions, other than hardship
distributions, and all nontaxable loans
currently available to him under all other
qualified and nonqualified deferred
compensation plans currently maintained by an
Employer.
In the event of any withdrawal by a Participant pursuant
to this Section 8.5, (i) such Participant's
Contributions under this Plan and his contributions
under all other qualified and nonqualified deferred
compensation plans maintained by an Employer shall be
suspended for a period of 12 months following such
withdrawal, and (ii) for the calendar year following the
calendar year in which such withdrawal occurred, the
amount of the Participant's 401(k) Contributions may not
exceed the limitation on the amount of 401(k)
Contributions which may be contributed, as set forth in
subsection 3.5(a), less the amount of any 401(k)
Contributions made by said Participant during the
calendar year of the withdrawal.
(b) No hardship withdrawal shall exceed the balance then
credited to the Participant's 401(k) Contribution
Section of his Accounts (or, if less, the Current Market
Value thereof) nor shall any withdrawal include earnings
on such Contributions after December 31, 1988.
8.6 Distribution of Withdrawals.
(a) Regular Withdrawals and Over Age 59-1/2 Withdrawals.
Regular Withdrawals and Over Age 59-1/2 Withdrawals
shall be permitted as of the Valuation Date following
Timely Notice (such Valuation Date being the Settlement
Date for such withdrawals). A distribution of a
withdrawal shall be made not later than 60 days after
the Settlement Date or such other time as specified by
Committee rule. A Participant who is entitled to
receive a Regular Withdrawal or an Over Age 59-1/2
Withdrawal may on Timely Notice elect to receive such
distribution in the form of either a Lump Sum
Distribution or a Lump Sum Optional Distribution.
(b) Hardship Withdrawals. If a Participant's application
for a hardship withdrawal is approved, the Settlement
Date for such withdrawal shall be the Valuation Date
following Timely Notice of such withdrawal. If the
Participant's application for a hardship withdrawal is
denied and, on appeal, subsequently approved, the
Settlement Date for such withdrawal shall be the
Valuation Date immediately preceding the date of the
Committee's decision on the appeal. Hardship
withdrawals will be made only in the form of a Lump Sum
Optional Distribution.
[The following replaces section 8.6 effective September 1, 1994:]
8.6 Distribution of Withdrawals.
(a) Regular Withdrawals and Over Age 59-1/2 Withdrawals.
Regular Withdrawals and Over Age 59-1/2 Withdrawals
shall be permitted as of the Valuation Date following
Timely Notice (such Valuation Date being the Settlement
Date for such withdrawals). A distribution of a
withdrawal shall be made not later than 60 days after
the Settlement Date or such other time as specified by
Committee rule. A Participant who is entitled to
receive a Regular Withdrawal or an Over Age 59-1/2
Withdrawal may on Timely Notice elect to receive such
distribution in the form of an All Stock Distribution ,
a Stock and Cash Distribution or an All Cash
Distribution.
(b) Hardship Withdrawals. If a Participant's application
for a hardship withdrawal is approved, the Settlement
Date for such withdrawal shall be the Valuation Date
following Timely Notice of such withdrawal. If the
Participant's application for a hardship withdrawal is
denied and, on appeal, subsequently approved, the
Settlement Date for such withdrawal shall be the
Valuation Date immediately preceding the date of the
Committee's decision on the appeal. Hardship
withdrawals will be made only in the form of an All Cash
Distribution.
8.7 Miscellaneous.
(a) Notwithstanding anything in this Article VIII to the
contrary, the withdrawal provision of this Article VIII
shall not apply for Terminated Participants.
(b) In the event of the death, prior to his Settlement Date
with respect to the withdrawal, of a Participant who has
elected to make a withdrawal, and if the Committee has
notice of the Participant's death prior to such
distribution, then such withdrawal shall be deemed
revoked. In the event of the death of a Participant on
or after the Settlement Date with respect to which the
Participant has elected to make a withdrawal, but prior
to the actual distribution thereof, and if the Committee
has notice of the Participant's death prior to such
distribution, then such distribution shall be made to
the Participant's Beneficiary by the same method as it
would have been made to the Participant but for his
death.
8.8 Waiver of Right to Withdraw. A Participant who is on an
assignment outside of the United States may waive his right
to make a withdrawal pursuant to this Article VIII. Any such
waiver shall be in writing, in a form acceptable to the
Committee and signed by the Participant, and shall be
irrevocable. The duration of a waiver hereunder may be for a
stated period or until the occurrence of a specified event,
at the election of the Participant, but in absence of such an
election the waiver shall expire upon termination or
completion of the Participant's assignment outside the United
States.
ARTICLE IX
INCENTIVE INVESTMENT PLAN COMMITTEE
9.1 Membership. The Committee shall consist of at least three
persons who shall be officers or directors of the Corporation
or Eligible Employees. Members of the Committee shall be
appointed from time to time by, and shall serve at the
pleasure of, the Executive Committee of the Board. The
Committee shall elect one of its members as chairman. The
Committee shall not receive compensation for its services.
Committee expenses shall be paid by the Corporation.
9.2 Powers. The Committee shall have all such powers as may be
necessary to discharge its duties hereunder, including, but
not by way of limitation, the power to construe or interpret
the Plan, to determine all questions of eligibility
hereunder, to determine the method of payment of any Accounts
hereunder, to adopt rules relating to the giving of Timely
Notice, and to perform such other duties as may from time to
time be delegated to it by the Executive Committee of the
Board. The Committee may prescribe such forms and systems
and adopt such rules and actuarial methods and tables as it
deems advisable. It may employ such agents, attorneys,
accountants, actuaries, medical advisors, or clerical
assistants (none of whom need be members of the Committee) as
it deems necessary for the effective exercise of its duties,
and may delegate to such agents any power and duties, both
ministerial and discretionary, as it may deem necessary and
appropriate.
9.3 Procedures. A majority of the Committee members shall
constitute a quorum. The Committee may take any action upon
a majority vote at any meeting at which a quorum is present,
and may take any action without a meeting upon the unanimous
written consent of all members. All action by the Committee
shall be evidenced by a certificate signed by the chairman or
by the secretary to the Committee. The Committee shall
appoint a secretary to the Committee who need not be a member
of the Committee,and all acts and determinations of the
Committee shall be recorded by the secretary, or under his
supervision. All such records, together with such other
documents as may be necessary for the administration of the
Plan, shall be preserved in the custody of the secretary.
9.4 Rules and Decisions. All rules and decisions of the
Committee shall be uniformly and consistently applied to all
Eligible Employees and Participants under this Plan in
similar circumstances and shall be conclusive and binding
upon all persons affected by them. The Committee shall have
absolute discretion in carrying out its duties under the
Plan.
9.5 Authorization of Payments. Subject to the provisions hereof,
it shall be the duty of the Committee to furnish the Trustee
with all facts and directions necessary or pertinent to the
proper disbursement of the Trust funds.
9.6 Books and Records. The records of the Employers shall be
conclusive evidence as to all information contained therein
with respect to the basis for participation in the Plan and
for the calculation of Contributions and Company Matching
Contributions.
9.7 Perpetuation of the Committee. In the event that the
Corporation shall for any reason cease to exist, then, unless
the Plan is adopted and continued by a successor, the members
of the Committee at that time shall remain in office until
the final termination of the Trust, and any vacancies in the
membership of the Committee caused by death, resignation,
disability or other cause, shall be filled by the remaining
member or members of the Committee.
9.8 Claim Procedure. The Committee shall establish a procedure
for handling all claims by all persons. In the event any
claim is denied, the Committee shall provide a written
explanation to the person stating the reasons for denial.
9.9 Allocation or Reallocation of Fiduciary Responsibilities.
The Named Fiduciary may allocate powers and responsibilities
not specifically allocated by the Plan, or reallocate powers
and responsibilities specifically allocated by the Plan, to
designated persons, partnerships or corporations other than
the Committee, and the members of the Committee may allocate
their responsibilities under the Plan among themselves. Any
such allocation, reallocation, or designation shall be in
writing and shall be filed with and retained by the secretary
of the Committee with the records of the Committee.
Notwithstanding the foregoing, no reallocation of the
responsibilities provided in the Trust to manage or control
the Trust assets shall be made other than by an amendment to
the Trust.
9.10 Plan Administrator. The Corporation shall be the Plan
Administrator as described in ERISA.
9.11 Service of Process. The Corporation shall be the designated
recipient of service of process with respect to legal actions
regarding the Plan.
ARTICLE X
AMENDMENT AND TERMINATION
10.1 Amendment and Termination. While it is intended that the
Plan shall continue in effect indefinitely, the Board may
from time to time modify, alter or amend the Plan or the
Trust using its prescribed procedures for actions by the
Board and may at any time order the temporary suspension or
complete discontinuance of Company Matching Contributions or
may terminate the Plan, provided, however, that
(i) no such action shall make it possible for any part of
the Trust assets (except such part as is used for the
payment of expenses) to be used for or diverted to any
purpose other than for the exclusive benefit of
Participants or their Beneficiaries;
(ii) no such action shall adversely affect the rights or
interests of Participants theretofore vested under the
Plan; and
(iii) in the event of termination of the Plan or complete
discontinuance of Company Matching Contributions
hereunder, all rights and interests of Participants not
theretofore vested shall become vested as of the date of
such termination or complete discontinuance.
Any action permitted to be taken by the Board under the
foregoing provision regarding the modification, alteration or
amendment of the Plan or the Trust may be taken by the
Committee, using its prescribed procedures, if such action
(1) is required by law, or
(2) is estimated not to increase the annual cost of the Plan
by more than $250,000.
The Committee shall report to the Board before January 31 of
each year all action taken by it hereunder during the
preceding calendar year.
However, nothing herein shall be construed to prevent any
modification, alteration or amendment of the Plan or of the
Trust which is required in order to comply with any law
relating to the establishment or maintenance of the Plan and
Trust, including but not limited to the establishment and
maintenance of the Plan or Trust as a qualified employee plan
or trust under the Code, even though such modification,
alteration, or amendment is made retroactively or adversely
affects the rights or interests of a Participant under the
Plan.
ARTICLE XI
MISCELLANEOUS
11.1 Non-Guarantee of Employment. Nothing contained in this Plan
shall be construed as a contract of employment between an
Employer and a Participant, or as a right of any Participant
to be continued in the employment of his Employer, or as a
limitation of the right of an Employer to discharge any
Participant with or without cause.
11.2 Rights to Trust Assets. No Participant or any other person
shall have any right to, or interest in, any part of the
Trust assets upon termination of his employment or otherwise,
except as provided from time to time under this Plan, and
then only to the extent of the amounts due and payable to
such person out of the assets of the Trust. All payments as
provided for in this Plan shall be made solely out of the
assets of the Trust and neither the Employers, the Trustee,
nor any member of the Committee shall be liable therefor in
any manner.
The Employers shall have no beneficial interest of any nature
whatsoever in any Employer Contributions after the same have
been received by the Trustee, or in the assets, income or
profits of the Trust, or any part thereof, except to the
extent that forfeitures as provided in the Plan shall be
applied to reduce the Employer Contributions.
11.3 Disclaimer of Liability. Neither the Trustee, the Employers,
nor any member of the Committee shall be held or deemed in
any manner to guarantee the funds of the Trust against loss
or depreciation.
11.4 Non-Recommendation of Investment. The availability of any
security hereunder shall not be construed as a recommendation
to invest in such security. The decision as to the choice of
investment of Contributions must be made solely by each
Participant, and no officer or employee of the Corporation or
the Trustee is authorized to make any recommendation to any
Participant concerning the allocation of Contributions
hereunder.
11.5 Indemnification of Committee. The Employers shall indemnify
the Committee and each of its members and hold them harmless
from the consequences of their acts or conduct in their
official capacity, including payment for all reasonable legal
expenses and court costs, except to the extent that such
consequences are the result of their own willful misconduct
or breach of good faith.
11.6 Selection of Investments. The Trustee shall have the sole
discretion to select investments for the various funds
provided for herein even though the same may not be legal
investments for trustees under the laws applicable thereto.
11.7 Non-Alienation. Except as otherwise provided herein, no
right or interest of any Participant or Beneficiary in the
Plan and the Trust shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, charge, attachment, garnishment, execution,
levy, bankruptcy, or any other disposition of any kind,
either voluntary or involuntary, prior to actual receipt of
payment by the person entitled to such right or interest
under the provisions hereof, and any such disposition or
attempted disposition shall be void.
11.8 Facility of Payment. If the Committee has notice that a
Participant entitled to a distribution hereunder, or his
Beneficiary, is incapable of caring for his own affairs,
because of illness or otherwise, the Committee may direct
that any distribution from such Participant's Accounts may be
made, in such shares as the Committee shall determine, to the
spouse, child, parent or other blood relative of such
Participant, or his Beneficiary, or any of them, or to such
other person or persons as the Committee may determine, until
such date as the Committee shall determine that such
incapacity no longer exists. The Committee shall be under no
obligation to see to the proper application of the
distributions so made to such person or persons, and any such
distribution shall be a complete discharge of any liability
under the Plan to such Participant, or his Beneficiary, to
the extent of such distribution.
11.9 Allocation in the Event of Advance Contributions. In the
event that the Employer's tax deduction with respect to
amounts contributed to the Plan pursuant to Articles III and
IV for the months in the final quarter of a Plan Year results
in such amounts being deemed advanced contributions of the
Employer with respect to the taxable year of the Employer
ending within such Plan Year, such amounts shall be
considered allocated pursuant to Articles III and IV, as
applicable, as of the last day of such taxable year.
11.10 Executive Committee of the Board. Any action which is
required or permitted to be taken by the Board under the
Plan may be taken by the Executive Committee of the
Board or any authorized committee of the Board.
11.11 Qualified Domestic Relations Orders. Anything in this
Plan to the contrary notwithstanding:
(a) Alternate Payee's Accounts. An alternate payee under a
domestic relations order determined by the Corporation
to be a qualified domestic relations order (as defined
in Code section 414(p)) shall have established and
maintained for him separate Accounts similar to the
Accounts of the Participant specified in the qualified
domestic relations order. The alternate payee's
Accounts shall be credited with his interest in such
Participant's Accounts, as determined under the
qualified domestic relations order. Except to the
extent specifically provided by the qualified domestic
relations order, no amount of the non-vested portion, if
any, of the Participant's Employer Accounts shall be
credited to the alternate payee's Accounts. Subsection
6.2(d) and Sections 6.3, 6.4 and 6.5 shall apply to the
alternate payee's Accounts as if the alternate payee
were a Participant.
(b) Investment of Alternate Payee's Accounts. On or after
the date which is three months following the effective
date of the qualified domestic relations order, an
alternate payee may on Timely Notice elect to
reallocate, effective as of the first Valuation Date
following his election, all or any percentage portion of
any of his Employee Accounts or Employer Accounts or
both, provided the alternate payee has not elected a
reallocation within the preceding three months. An
alternate payee's interest arising from this
reallocation shall be invested in the various funds in
accordance with the alternate payee's directions. For
purposes of subsection 6.1(b), any such reallocation
shall be treated as a reallocation in accordance with
subsection 6.1(a).
(c) Alternate Payee's Beneficiary. Except to the extent
otherwise provided by the qualified domestic relations
order relating to an alternate payee:
(i) the alternate payee may designate on Timely Notice
a beneficiary,
(ii) if no such person is validly designated or if the
designated person predeceases the alternate payee,
the beneficiary of the alternate payee shall be his
estate, and
(iii) the beneficiary of the alternate payee shall be
accorded under the Plan all the rights and
privileges of the Beneficiary of a Participant.
(d) Distribution to Alternate Payee. An alternate payee
shall be entitled to receive a distribution from the
Plan in accordance with the qualified domestic relations
order relating to the alternate payee. Such
distribution may be made only in a method provided in
Section 7.4 and shall include only such amounts as have
become vested; provided, however, that if a qualified
domestic relations order so provides, a lump sum
distribution of the total vested amount credited to the
alternate payee's Accounts may be made to the alternate
payee before the date that the Participant specified in
the qualified domestic relations order attains his
earliest retirement age (as defined in Code section
414(p)(4)(B)). A qualified domestic relations order may
provide that until a distribution is made to the
alternate payee, the alternate payee may make
withdrawals in accordance with Article VIII as if the
alternate payee were an employed Participant; provided,
however, that (i) hardship withdrawals from the portion
of the alternate payee's Accounts attributable to the
401(k) Contributions Section of the Accounts of the
Participant specified in the qualified domestic
relations order shall not be available to an alternate
payee and (ii) no withdrawal suspension penalties shall
be imposed on account of a withdrawal by an alternate
payee.
(e) Vesting of Alternate Payee's Accounts. In the event
that the qualified domestic relations order provides for
all or part of the non-vested portion of the
Participant's Employer Accounts to be credited to the
Accounts of the alternate payee, such amounts shall vest
and/or be forfeited at the same time and in the same
manner as the Accounts of the Participant specified in
the qualified domestic relations order; provided,
however, that no forfeiture shall result to the Accounts
of the alternate payee due to any distribution to or
withdrawal by the Participant from his Accounts or any
distribution to or withdrawal by the alternate payee
from the vested portion of the Accounts of the alternate
payee.
11.12 Tax Reform Act of 1986; Special Effective Dates. In
addition to the other limitations set forth in the Plan
and notwithstanding the provisions relating to the
effective date of the Plan, the Plan shall be or shall
have been administered (i) according to the applicable
provisions (as determined by the Committee) of the Tax
Reform Act of 1986 and (ii) with the following
provisions effective as of the dates specified:
(a) Subsections 2.1(b) and 4.4(a), relating to the
Actual Contribution Percentage, which shall be
effective April 1, 1987;
(b) Subsections 2.1(c) and 3.5(b), relating to the
Actual Deferral Percentage, which shall be
effective April 1, 1987;
(c) Subsection 2.1(d), relating to the definition of
Affiliated Employer for purposes of Article XIV,
which shall be effective April 1, 1987;
(d) Subsection 2.1(e), relating to the limit on
compensation used to determine a Participant's Base
Salary Rate, which shall be effective January 1,
1989;
(e) Subsection 2.1(r), relating to exclusion of leased
employees from definition of Eligible Employee,
which shall be effective for services performed
after December 31, 1986;
(f) Subsection 2.1(ll), relating to the definition of
Highly Compensated Eligible Employee, which shall
be effective April 1, 1987;
(g) Subsections 2.1(eee) and 3.2(c), relating to
Special Unrestricted After-Tax Contributions, which
shall be effective April 1, 1989;
(h) Subsection 2.1(jjj), relating to Total
Compensation, which shall be effective April 1,
1987, with said limitation contained therein,
effective January 1, 1989;
(i) Subsection 3.5(a)(i), relating to the limitation of
401(k) Contributions made on behalf of a
Participant during the taxable year, which shall be
effective for services performed after December 31,
1986;
(j) Subsection 7.1(d), relating to the vesting
provisions under the Plan, which shall be effective
April 1, 1989;
(k) Sections 8.1 through 8.5, relating to withdrawals
from the Plan, which shall be effective April 1,
1989;
(l) Subsection 8.6(b) with respect to the Valuation
Date for initial applications and appeals for
hardship withdrawals, which shall be effective
April 1, 1992; and
(m) Subsections 12.1(a)(1)(C), 12.1(a)(ii)(D),
12.1(a)(ii)(F) through (G), and 12.1 (a)(vi)(A)(1),
relating to the limit on Annual Additions to the
Plan, which shall be effective for Limitation Years
beginning after December 31, 1986.
ARTICLE XII
LIMITATIONS ON BENEFITS
12.1 Definitions and Rules.
(a) Definitions. For purposes of Article XII, the following
definitions and rules of interpretation shall apply.
(i) "Annual Additions" to a Participant's Accounts
under this Plan is the sum, credited to a
Participant's Accounts for any Limitation Year, of:
(A) Company contributions,
(B) forfeitures, if any, and
(C) Participant Contributions.
(ii) "Annual Benefit" -
(A) A benefit which is payable annually in the
form of a straight life annuity under a
defined benefit plan maintained by the Company
which is subject to the limitations of Code
section 415. In the case of such a benefit
which is not payable in the form of a straight
life annuity, the benefit will be adjusted in
accordance with subsection 12.1(a)(ii)(C)
below.
(B) When there is a transfer of assets or
liabilities from one qualified plan to
another, the Annual Benefit attributable to
the assets transferred shall not be taken into
account by the transferee plan in applying the
limitations of Code section 415. The Annual
Benefit payable on account of the transfer for
any individual that is attributable to the
assets transferred will be equal to the annual
benefit transferred on behalf of such
individual multiplied by a fraction, the
numerator of which is the value of the total
assets transferred and the denominator of
which is the value of the total liabilities
transferred.
(C) In the case of a retirement benefit under a
defined benefit plan subject to the
limitations of Code section 415(b) which is in
any form other than a straight life annuity,
such benefit will be adjusted to a straight
life annuity beginning at the same age which
is the actuarial equivalent of such benefit in
accordance with applicable regulations and
rules determined by the Commissioner, but
without taking into account:
(1) the value of a qualified joint and
survivor annuity (as defined in Code
section 401(a)(11)(G)(iii) and the
regulations thereunder) provided by a
defined benefit plan to the extent that
such value exceeds the sum of (a) the
value of a straight life annuity
beginning on the same date and (b) the
value of any post-retirement death
benefits which would be payable even if
the annuity were not in the form of a
joint and survivor annuity,
(2) the value of benefits that are not
directly related to retirement benefits
(such as, but not limited to, pre-
retirement disability and death
benefits), and
(3) the value of benefits provided by a
defined benefit plan which reflect post-
retirement cost-of-living increases to
the extent that such increases are in
accordance with Code section 415(d) and
the regulations thereunder.
(D) In the case of a retirement benefit beginning
before the Social Security Retirement Age
under a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(E) If a Participant has less than 10 Years of
Vesting Service with the Company at the time
the Participant begins to receive retirement
benefits under a defined benefit plan, the
benefit limitations described in Code section
415(b)(1) and (4) are to be reduced by
multiplying the otherwise applicable
limitation by a fraction, the numerator of
which is the number of Years of Vesting
Service with the Company as of, and including,
the current Limitation Year, and the
denominator of which is 10. For purposes of
this paragraph (E), Years of Vesting Service
shall be determined in accordance with such
defined benefit plan.
(F) In the case of a retirement benefit beginning
after the Social Security Retirement Age under
a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(G) For purposes of this Section, the "Social
Security Retirement Age" shall mean the age
used as the retirement age under
section 216(l) of the Social Security Act,
applied without regard to the age increase
factor and as if the early retirement age
under section 216(l)(2) of the Social Security
Act were 62.
(iii) "Company" - any corporation which is a
member of a controlled group of corporations (as
defined in Code section 414(b) and modified by Code
section 415(h)) or an affiliated service group (as
defined in section 414(m) of the Code) which
includes an Employer; any trades or businesses
(whether or not incorporated) which are under
common control (as defined in Code section 414(c)
and modified by Code section 415(h)) with an
Employer; or any other entity required to be
aggregated with an Employer pursuant to Code
section 414(o).
(iv) "Compensation" with respect to a Limitation Year -
(A) includes amounts actually paid or made
available to a Participant (regardless of
whether he was such during the entire
Limitation Year);
(1) as wages, salaries, fees for professional
service, and other amounts received for
personal services actually rendered in
the course of employment with the Company
including but not limited to commissions,
compensation for services on the basis of
a percentage of profits and bonuses;
(2) for purposes of (i) above, earned income
from sources outside the United States
(as defined in Code section 911(b));
whether or not excludable from gross
income under Code section 911 or
deductible under Code section 913;
(3) amounts described in Code sections
104(a)(3), 105(a) and 105(h) but only to
the extent that these amounts are
includable in the gross income of the
Participant;
(4) amounts paid or reimbursed by the Company
for moving expenses incurred by the
Participant, but only to the extent that
these amounts are not deductible by the
Participant under Code section 217;
(5) value of a nonqualified stock option
granted to the Participant, but only to
the extent that the value of the option
is includable in the gross income of the
Participant in the taxable year in which
granted;
(6) the amount includable in the gross income
of a Participant upon making the election
described in Code section 83(b).
(B) excludes -
(1) amounts contributed to this Plan by
Employers on behalf of Participants as
401(k) Contributions (and not considered
Basic After-Tax Contributions under
Section 3.5(a)(ii) nor recharacterized as
Basic After-Tax Contributions under
Section 3.5(b)(iii)).
(2) contributions made by the Company to a
plan of deferred compensation to the
extent that, before the application of
the Code section 415 limitations to that
plan, the contributions are not
includable in the gross income of the
Participant for the taxable year in which
contributed and any distributions from a
plan of deferred compensation, regardless
of whether such amounts are includable in
the gross income of the Participant when
distributed; provided however, any
amounts received by a Participant
pursuant to an unfunded nonqualified plan
shall be considered as Compensation in
the year such amounts are includable in
the gross income of the Participant;
(3) amounts realized from the exercise of a
nonqualified stock option, or recognized
when restricted stock (or property) held
by a Participant either becomes freely
transferable or is no longer subject to a
substantial risk of forfeiture pursuant
to Code section 83 and the regulations
thereunder;
(4) amounts realized from the sale, exchange
or other disposition of stock acquired
under a qualified stock option;
(5) other amounts which receive special tax
benefits such as premiums for group term
life insurance (but only to the extent
that the premiums are not includable in
the gross income of the Participant); and
(6) Compensation in excess of $200,000 (as
automatically increased in accordance
with applicable regulations to reflect
cost-of-living adjustments).
(v) "Limitation Year" - a calendar year;
(vi) "Maximum Permissible Amount" -
(A) for a Limitation Year, with respect to any
Participant, subject to the rule in
paragraph (B), the lesser of
(1) $30,000 (or, if greater, 1/4 of the
dollar limitation in effect under Code
section 415(b)(1)(A)), or
(2) 25% of the Participant's Compensation for
the Limitation Year.
(B) As of January 1 of each calendar year, the
dollar limitation set forth in subparagraph
(A)(1) above shall be adjusted automatically
for cost-of-living increases to equal the
dollar limitation as determined by the
Commissioner for that calendar year under Code
section 415(d)(1)(B). This adjusted dollar
limitation applies for the Limitation Year
ending with that calendar year.
(vii) "Projected Annual Benefit" - the Annual Benefit to
which a Participant would be entitled under a
defined benefit plan maintained by the Company on
the assumptions that he or she continues employment
until the normal retirement age (or current age, if
that is later) thereunder, that his or her
Compensation continues at the same rate as in
effect for the Limitation Year under consideration
until such age, and that all other relevant factors
used to determine benefits under the Plan remain
constant as of the current Limitation Year for all
future Limitation Years;
(b) Other Rule. For purposes of applying the limitations of
Code section 415(b), (c) and (e) applicable to a
Participant for a particular Limitation Year, all
qualified defined contribution plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as part of this Plan and all
qualified defined benefit plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as one defined benefit plan.
12.2 Limits.
(a) Annual Addition Limit. The amount of the Annual
Addition which may be credited under this Plan to any
Participant's Accounts as of any allocation date shall
not exceed the Maximum Permissible Amount (based upon
his Compensation up to such allocation date) reduced by
the sum of any Annual Additions made to the
Participant's Accounts under this Plan as of any
preceding allocation date within the Limitation Year.
If an allocation date of this Plan coincides with an
allocation date of any other qualified defined
contribution plan maintained by the Company, the amount
of the Annual Additions which may be credited under this
Plan to any Participant's Accounts as of such date shall
be an amount equal to the product of the amount to be
credited under this Plan without regard to this Section
12.2 multiplied by the lesser of 1.0 or a fraction, the
numerator of which is the amount described in this
subsection (a) of Section 12.2 during the Limitation
Year and the denominator of which is the amount that
would otherwise be credited on this allocation date
under all plans without regard to this Section 12.2. If
contributions to this Plan by or on behalf of a
Participant are to be reduced as a result of this
Section 12.2, such reduction shall be effected by first
reducing any Unrestricted After-Tax Contributions and
second, if and to the extent necessary, by
proportionately reducing any Basic After-Tax
Contributions and corresponding Company Matching
Contributions and then, if and to the extent necessary,
by proportionately reducing any 401(k) Contributions and
corresponding Company Matching Contributions. If as a
result of a reasonable error in estimating a
Participant's Compensation, or under the limited facts
and circumstances which the Commissioner finds justify
the availability of the rules set forth in this Section
12.2, the allocation of Annual Additions under the terms
of the Plan for a particular Participant would cause the
limitations of Code section 415 applicable to that
Participant for the Limitation Year to be exceeded, the
excess amounts shall not be deemed to be Annual
Additions in that Limitation Year if they are treated as
follows:
(i) The excess amounts in the Participant's Account
consisting of Participant Contributions and
Contributions made on his behalf and any increment
attributable thereto shall be paid to the
Participant as soon as administratively feasible.
(ii) The excess amounts in the Participant's Account
consisting of Company Matching Contributions shall
be used to reduce Company Matching Contributions
for the next Limitation Year (and succeeding
Limitation Years, as necessary) for that
Participant if that Participant is covered by the
Plan as of the end of the Limitation Year.
However, if that Participant is not covered by the
Plan as of the end of the Limitation Year then the
excess amounts must be held unallocated in a
suspense account for the Limitation Year and
allocated and reallocated in the next Limitation
Year to all of the remaining Participants in the
Plan. If a suspense account is in existence at any
time during a particular Limitation Year, other
than the first Limitation Year described in the
preceding sentence, all amounts in the suspense
account must be allocated and reallocated to
Participant's Accounts (subject to the limitations
of Code section 415) before any Company Matching
Contributions and Contributions which would
constitute Annual Additions may be made to the Plan
for that Limitation Year and such excess amounts
must be used to reduce Company Matching
Contributions for the next Limitation Year (and
succeeding Limitation Plan Years, as necessary) for
all of the remaining Participants in the Plan. For
purposes of this subdivision, excess amounts may
not be distributed to Participants or former
Participants.
(iii) In the event of termination of the Plan the
suspense account described in (ii) above shall
revert to the Employer to the extent it may not
then be allocated to any Participant's Account.
(iv) Notwithstanding any other provision in this Section
12.2, the Employer shall not contribute any amount
that would cause an allocation to the suspense
account as of the date the contribution is
allocated. If the contribution is made prior to
the date as of which it is to be allocated, then
such contribution shall not exceed an amount that
would cause an allocation to the suspense account
if the date of contribution were an allocation
date.
(b) Overall Limit. For any Participant of this Plan who at
any time participated in a defined benefit plan
maintained by the Company, the rate of benefit accrual
by such Participant in each defined benefit plan in
which the Participant participates during the Limitation
Year will be reduced to the extent necessary to prevent
the sum of the following fractions, computed as of the
close of the Limitation Year, from exceeding 1.0:
(i) The Projected Annual Benefit of the Participant
under the defined benefit plan
over
The lesser of (1) the product of 1.25 multiplied by
the dollar limitation in effect under Code section
415(b)(1)(A) for such Limitation Year or (2) the
product of 1.4 multiplied by the amount which may
be taken into account under Code section
415(b)(1)(B) with respect to such Participant for
such Limitation Year,
plus
(ii) The sum of Annual Additions to such Participant's
Accounts under this Plan in such Limitation Year
and for all prior Limitation Years
over
The sum of the lesser of the following amounts
determined for such year and for each prior year of
service with the Company: (1) the product of 1.25
multiplied by the dollar limitation in effect under
Code section 415(c)(1)(A) for such Limitation Year
or (2) the product of 1.4 multiplied by 25% of the
Participant's Compensation for such Limitation
Year.
(c) Special Rules Applicable to Computation of Overall
Limit.
(i) For purposes of applying the defined contribution
plan fraction in Section 12.2(b), for any
Limitation Year beginning after December 31, 1975,
the following rules shall apply with respect to
Limitation Years before January 1, 1976:
(A) The aggregate amount taken into account in
determining the numerator of such fraction is
deemed not to exceed the aggregate amount
taken into account in determining the
denominator of the fraction.
(B) The amount taken into account for purposes of
subsection 12.1(a)(i)(C)(1) is an amount equal
to the excess of the aggregate amount of the
Participant's contributions for such years
during which he was an active participant in
the Plan over 10% of the Participant's
aggregate Compensation for all such years,
multiplied by a fraction, the numerator of
which is 1.0 and the denominator of which is
the number of years beginning before
January 1, 1976, during which the Participant
participated in the Plan. Participant
contributions made on or after October 2,
1973, shall be taken into account for purposes
of the preceding sentence only to the extent
that the amount of such contributions was
permissible under a plan as in effect on that
date.
(ii) In any case where the sum of the fractions in
Section 12.2(b) is greater than 1.0 calculated as
of the close of the last Limitation Year beginning
before January 1, 1983 for a Participant in
accordance with regulations prescribed by the
Commissioner pursuant to Section 235(g)(3) of the
Tax Equity and Fiscal Responsibility Act of 1982,
an amount shall be subtracted from the numerator of
the defined contribution plan fraction so that the
sum of such fractions does not exceed 1.0 for such
Limitation Year.
ARTICLE XIII
MERGER
No merger or consolidation with or transfer of any assets or
liabilities to any other plan after September 2, 1974, shall be
made unless, upon completion therof, the value of each
Participant's Account shall immediately after said merger,
consolidation, or transfer be equal to or greater than the value
of the Participant's Account immediately before the merger,
consolidation, or transfer (if the Plan had then terminated).
ARTICLE XIV
TOP-HEAVY REQUIREMENTS
14.1 Top-Heavy Requirements. Notwithstanding any other provisions
of this Plan, the following rules shall apply for any
Plan Year if as of the last day of the preceding Plan Year,
based on valuations as of such date, the sum of the present
value of accrued benefits and Accounts of "key employees"
(within the meaning of Code section 416) exceeds 60% of a
similar sum for all employees under each plan of the Employer
or any Affiliated Employer in which a "key employee"
participates and each other plan of the Employer or any
Affiliated Employer which enables any such plan to meet the
requirements of Code section 401(a)(4) or 410. A Plan Year
during which such rules apply shall be known as a "Top-Heavy
Plan Year."
(a) Vesting. A Participant who is credited with an
Hour of Service during the Top-Heavy Plan Year, or in
any Plan Year after the Top-Heavy Plan Year, and who has
completed at least three years of Service shall have a
nonforfeitable right to 100% of his Employer Accounts
and no such amount may become forfeitable if the Plan
later ceases to be Top-Heavy nor may such amount be
forfeited under the provisions of Code sections
411(a)(3)(B) (relating to suspension of benefits upon
reemployment) or 411(a)(3)(D) (relating to forfeitures
upon withdrawal of mandatory contributions). If the
Plan become Top-Heavy and later ceases to be Top-Heavy,
this vesting schedule shall no longer apply and benefits
which have not at such time vested under this schedule
shall vest only in accordance with other provisions of
this Plan, provided that any Participant with at least 3
years of Service shall be entitled to continue to
utilize this schedule for vesting purposes by making an
election at the time and in the manner specified by the
Committee.
(b) Required Contributions. Each Employer shall contribute
on behalf of each employee eligible to participate in
the Plan, the lesser of:
(i) 3% of such employee's compensation (within the
meaning of Code section 415); or
(ii) the percentage of such employee's compensation
(within the meaning of Code section 415) which is
equal to the percentage at which contributions were
made for that Plan Year on behalf of the "key
employee" for whom such percentage is the greatest
for such Plan Year, as prescribed by Code section
416(c)(2)(B) and regulations thereunder;
provided, however, that any contributions for any
employee required of any Employer by the above
provisions of this subsection 14.1(b) shall be reduced
by the amount of any Company Matching Contribution made
with respect to such Plan Year for such employee under
Article IV of this Plan. Any contribution made pursuant
to this subsection 14.1(b) shall be allocated to the
Employer Stock Account on behalf of the employee for
whom such contribution is made.
(c) Additional Limitations. No allocations may be made to
the Account of a Participant the sum of whose defined
benefit plan fraction and defined contribution plan
fraction, as defined in Code section 415(e), exceeds 1.0
when the dollar amounts, as defined in Section 12.2(b)
hereof, are multiplied by 1.0 rather than 1.25.
The provisions of this Section 14.1 shall be interpreted
in accordance with the provisions of Code section 416
and any regulations thereunder, which are hereby
expressly incorporated by reference.
(d) Coordination. In the event a top heavy minimum
contribution or benefit is required under this Plan or
another plan of an Employer that covers a Participant,
the top heavy minimum contribution or benefit, as
appropriate, shall be provided in this Plan.
S-59-A
APPENDIX A
LIST OF EMPLOYERS, PARTICIPATING UNITS AND APPLICABLE SCHEDULES
Employers and Participating Units Schedule
Avent, Inc. I
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
Coosa Pines Golf Club, Incorporated I
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
Jet Professionals, Inc. I
All salaried non-intermittent employees of
this Employer including those on temporary
assignment at other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
K-C Aviation Inc. I
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
Kimberly-Clark Computer Services, Inc. I
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
Employers and Participating Units Schedule
Kimberly-Clark Corporation I
(a) All salaried employees of this
Employer, including those on temporary
assignment at other units or Employers
or in other classifications, but
excluding employees on temporary
assignment from another unit, Employer
or classification and nonexempt
salaried employees at the Conway
Mills, Corinth Mills, Paris Plant,
LaGrange Mill, Lexington Mill, Ogden
Plant and Maumelle Facility.
(b) All nonexempt salaried employees at II
the Conway Mills, including those on
temporary assignment in other
classifications or at other units or
Employers but excluding employees on
temporary assignment from another
unit, Employer or classification.
(c) All nonexempt salaried employees at III
the Corinth Mills, including those on
temporary assignment in other
classifications or at other units or
Employers but excluding employees on
temporary assignment from another
unit, Employer or classification.
Kimberly-Clark International Services I
Corporation
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
Kimberly-Clark Integrated Services I
Corporation
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
Employers and Participating Units Schedule
Midwest Express Airlines, Inc. I
All salaried employees of this Employer,
including those on temporary assignment at
other Employers or in other
classifications, but excluding employees on
temporary assignment from another Employer
or classification.
KIMBERLY-CLARK CORPORATION
SALARIED EMPLOYEES
INCENTIVE INVESTMENT PLAN
APPENDIX
REVENUE RECONCILIATION ACT OF 1993 AMENDMENTS
In addition to other applicable limitations which may be set forth
in the Plan and notwithstanding any other contrary provision of
the Plan, compensation taken into account under the plan shall not
exceed $150,000, adjusted for changes in the cost of living as
provided in sections 401(a)(17)(B) and 415(d) of the Internal
Revenue Code, for the purpose of calculating a Plan participant's
accrued benefit (including the right to any optional benefit
provided under the Plan) for any Plan Year commencing after
December 31, 1993. However, the accrued benefit determined in
accordance with this provision shall not be less than the accrued
benefit determined on January 1, 1994, without regard to this
provision.
KIMBERLY-CLARK CORPORATION
SALARIED EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE II
(As amended through May 24, 1994)
(Conway Mills)
With respect to the Participating Unit under this Schedule, as set
forth in Appendix A, the Plan shall apply with full force and
effect except that Articles II, III, IV, VI, VIII and XII of this
Schedule shall apply in lieu of the same numbered Articles of the
Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employees for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic After-Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Salary Rate: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of regular earnings
while a Participant. Base Salary Rate shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Salary Rate under the Plan shall not
exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee has completed an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires, or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board of Directors of the Corporation)
shall be the Named Fiduciary of the Plan as defined in
ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each 12 calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Regular Unrestricted After-Tax Contributions: After-
Tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(zz) Service: Regular employment with the Corporation, a
Subsidiary or any Equity Company.
(aaa) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(bbb) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ccc) Special Unrestricted After-Tax Contributions: Special
Contributions which are made under subsection 3.2(c).
(ddd) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(eee) Terminated Participant: A Participant who has
terminated his employment with an Employer and the
aggregate value of the Participant's Accounts exceeds
$3,500 and who has not elected to receive a distribution
under the Plan.
(fff) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(ggg) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(hhh) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(iii) Trust: The Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan Trust pursuant to
the trust agreement provided for in Article V.
(jjj) Trustee: The trustee under the Trust.
(kkk) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(lll) Valuation Date: The last day of each month.
(mmm) Withdrawal Year: As defined in Section 8.1.
(nnn) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employees for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic After-Tax Contributions (including amounts
recharacterized as Basic After-Tax Contributions
under subsection 3.5(b)(iii)), and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year (but only
to the extent that such Contributions and Company
Matching Contributions are not considered for
purposes of Section 2.1(c) hereof), together with
qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in subsection 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Salary Rate: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of regular earnings
while a Participant. Base Salary Rate shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Salary Rate under the Plan shall not
exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation, or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by or
on behalf of Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (v), (w), (x) and (y) of this Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of this Section
2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1. He remains a
Participant until all of his Accounts have been
distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(zz) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(aaa) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(bbb) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.,
disability, leave of absence, or layoff, etc.)
(ccc) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(ddd) Stock and Cash Distribution: As defined in subsection
7.3(b).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising
out of any injury or disease which the Committee
determines is permanent and prevents a Participant from
engaging in any occupation with the Corporation, a
Subsidiary or an Equity Company commensurate with his
education, training and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan Trust pursuant to
the trust agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan, and any Employee contributions, as
defined in Code Section 401(m) and the regulations
thereunder, contributed prior to April 1, 1990, on
account of which a Company Matching Contribution was
made to this Plan on behalf of a Participant who was
employed prior to April 1, 1989.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE III
PARTICIPATION, CONTRIBUTIONS, AND ALLOCATIONS
3.1 Election to Participate. An Eligible Employee's election to
participate in the Plan shall, if given on Timely Notice,
(i) be effective as of the first Entry Date following his
election, and
(ii) remain in effect as a valid election to participate for
each successive Plan Year.
An election to participate by an Eligible Employee who,
immediately prior to becoming an Eligible Employee, was a
participant under the Kimberly-Clark Corporation Hourly
Employees Incentive Investment Plan shall be effective as
soon as administratively feasible upon exercising his
election.
3.2 Amount of Contributions by Participants.
(a) Basic After-Tax Contributions: During each Plan Year
Basic After-Tax Contributions shall be made by a
Participant for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 2%, 3%,
4%, 5% or 6% of his Base Salary Rate.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice a
Participant may change his election effective as of the
first day of any month.
[The following replaces section 3.2(a) effective January 1, 1995:]
(a) Basic After-Tax Contributions. During each Plan Year,
Basic After-Tax Contributions shall be made by a
Participant for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 1%, 2%,
3%, 4%, 5% or 6% of his Base Salary Rate.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice, a
Participant may change his election effective as of the
first day of any month.
(b) Regular Unrestricted After-Tax Contributions.
(i) A Participant may elect on Timely Notice to make
Regular Unrestricted After-Tax Contributions to his
Account in any whole percentage equal to an amount
which is not less than 1% of his Base Salary Rate
and not more than 6% of his Base Salary Rate.
(ii) An election to make Regular Unrestricted After-Tax
Contributions by regular payroll deduction shall
remain in effect for so long as a Participant is
eligible to make Regular Unrestricted After-Tax
Contributions or, if earlier, until changed by a
Participant. A Participant may change such
election on Timely Notice effective as of the first
day of any month.
(iii) Regular Unrestricted After-Tax Contributions will
not be taken into account in determining the amount
of Company Matching Contributions made on behalf of
Participants.
(c) Special Unrestricted After-Tax Contributions. Once each
Plan Year a Participant may elect to make a Special
Unrestricted After-Tax Contribution in excess of the
amount elected under subsection 3.2(b)(i) in an amount
(i) which is elected by him on Timely Notice,
(ii) which, when added to the total of Regular
Unrestricted After-Tax Contributions made by the
Participant to date in the Plan Year, would not
exceed 6% of his Base Salary Rate for those periods
to date in such Plan Year during which Basic
After-Tax Contributions have been made;
(iii) which shall only be made in cash; and
(iv) which will not be taken into account in determining
the amount of Company Matching Contributions made
on behalf of the Participant.
3.3 General Limitation: Notwithstanding any other provision of
this Article III, no Contribution shall be made to the Plan
which would cause the Plan to fail to meet the requirements
for exemption from tax or to violate any provisions of the
Code.
3.4 Allocation of Contributions by Participants.
Basic After-Tax Contributions and Unrestricted After-Tax
Contributions: On Timely Notice a Participant shall elect to
allocate in whole multiples of 1% all of his Basic After-Tax
Contributions and Unrestricted After-Tax Contributions to be
made during a Plan Year to one or more of
(i) the Government Fund,
(ii) the Diversified Fund,
(iii) the Fixed Income Fund, or
(iv) the K-C Stock Fund.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice a
Participant may change his election effective as of the first
day of any month.
3.5 Suspension of All Contributions. On Timely Notice and
notwithstanding the provisions of Section 3.2, a Participant
may elect to suspend, effective reasonably soon after such
notice is given as established by Committee rule, all of his
Contributions. On Timely Notice, a Participant may elect to
resume such Contributions, or have such Contributions
resumed, as of any Entry Date, provided, however, that any
such suspension must be for a period of not less than three
months.
A Participant's Contributions and Contributions made on his
behalf shall be automatically suspended commencing with and
continuing throughout any period during which he fails to
qualify as an Eligible Employee. On Timely Notice upon
requalifying as an Eligible Employee a Participant may elect
to make Contributions to his Accounts as soon as
administratively possible.
3.6 Payment of Contributions to Trustee. The Employers shall
contribute or remit to the Trustee as soon as practicable
after the end of each month the amounts withheld from the
Participants' compensation during the month as Contributions
under the Plan.
3.7 Reallocation of Participant's Accounts. A Participant who
has remained a Participant for at least three months may on
Timely Notice elect to reallocate, effective as of the first
Valuation Date following his election, all or any whole
percentage portion of any of his Employee Accounts or
Employer Accounts or both, provided he has not elected a
reallocation within the preceding three months; provided,
however, that a three month period that begins at the end of
a Plan Year shall not be more than ninety (90) days.
3.8 Redeposits and Restored Amounts.
(a) Notwithstanding any provision in this Plan to the
contrary, on Timely Notice, an Employee who has
forfeited all or a portion of his Employer Accounts may,
within 5 years of the date of the distribution or
withdrawal which caused such forfeiture, redeposit such
distribution or withdrawal, and upon such redeposit, the
amount of the forfeiture associated with the redeposit
shall be restored to the Employee's Employer Stock
Account (and to the Withdrawal Year) from which it was
forfeited. Redeposits shall be allocated to the Plan
funds in the same manner as Basic After-Tax
Contributions made by the Participant. Redeposits shall
be made on a Withdrawal Year by Withdrawal Year basis,
beginning with the most remotely ended Withdrawal Year,
and the amount redeposited for any Withdrawal Year shall
be equal to the amount distributed or withdrawn which
caused the forfeiture for that Withdrawal Year.
For an Employee hired after March 31, 1989, the amount
redeposited shall be equal to the total amount
distributed or withdrawn which caused the forfeiture.
(b) No redeposit of a withdrawal or distribution shall be
permitted if, coincident with or subsequent to the
forfeiture associated with that withdrawal or
distribution, an Employee incurs 5 consecutive One-Year
Periods of Severance. For Plan Years prior to April 1,
1989, and for purposes of this Section 3.8 only, an
Employee incurs a One-Year Period of Severance if he is
not an Employee on the last day of a Plan Year.
(c) Where applicable, if an Employee receives such a
distribution or makes a withdrawal that results in a
forfeiture, and if such Employee does not make a
redeposit of such amount within the same Plan Year, any
Plan Year between the Plan Year of distribution or
withdrawal and the Plan Year of redeposit (including the
Plan Year of distribution or withdrawal but not
including the Plan Year of redeposit) shall not be
counted in determining when the restored amounts are
attributable to a Withdrawal Year or Matured Withdrawal
Years.
(d) Notwithstanding the preceding provision, a Participant
who is entitled to no portion of his Employer Account
upon termination of employment shall be deemed to have
received a distribution of zero dollars ($0) from such
account at the earliest possible date provided under
Section 7.2.
(e) Any forfeiture from the Basic After-Tax Contribution
section of his Employer Accounts under subsection 7.1(f)
and the applicable years of Service shall be restored in
accordance with the provisions of this Section 3.8 if
the Terminated Participant returns to his employment
with an Employer prior to incurring 5 consecutive One-
Year Periods of Severance.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.3, Company
Matching Contributions for each Plan Year shall be 50% of
Basic After-Tax Contributions for that Plan Year allocated to
the K-C Stock Fund and 20% of Basic After-Tax Contributions
for that Plan Year allocated to the Government Fund, the
Diversified Fund or the Fixed Income Fund.
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.3 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if, in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.4 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.4(a)(i) shall be determined in the
manner set forth in subsection 4.4(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.4(a)(i)
above.
ARTICLE VI
INVESTMENT, PARTICIPANT'S ACCOUNTS, AND VOTING OF STOCK
6.1 Investment of Contributions.
(a) A Participant's Contributions during each Plan Year
shall be invested in the various funds in accordance
with the Participant's allocations under Section 3.4. A
Participant's interest arising from his reallocation for
prior Plan Years shall be invested in the various funds
in accordance with the Participant's directions under
Section 3.7. Company Matching Contributions during each
Plan Year shall be invested in the K-C Stock Fund. All
such investments and gains or losses related thereto
shall be allocated to each Participant's Accounts
pursuant to the provisions of Section 6.2.
(b) The Committee shall designate Participants'
Contributions and Company Matching Contributions for
payment to the Trustee for investment, and Employee
Accounts and Employer Accounts for reallocation in
accordance with subsection 6.1(a), and shall advise the
Trustee of such designation.
6.2 Participant's Accounts.
(a) Establishment of Accounts. Each Participant shall have
established and maintained for him separate Accounts
which, depending upon the allocation and reallocation
options he has selected, shall consist of Employee
Accounts and Employer Accounts in one or more of the
Government Fund, the Diversified Fund, the Fixed Income
Fund, and the K-C Stock Fund. Each such Employee
Account shall be subdivided into a Basic After-Tax
Contribution and Unrestricted After-Tax Contribution
Section. Each such Employer Account shall be subdivided
into subsections corresponding to the Sections of the
Employee Accounts, other than the Unrestricted After-
Tax Contribution Section.
As soon as practicable following the end of each Plan
Year, the Committee will cause an annual statement to be
prepared for each Participant which will reflect the
status of the Participant's Accounts in such form as
shall be prescribed by the Committee.
(b) Separation of Accounts. Each Participant's Accounts
shall be further separated and maintained as Withdrawal
Years and Matured Withdrawal Years as set forth in
Sections 8.1 and 8.2.
(c) Crediting of Accounts. As of the close of business on
each Valuation Date the designated Accounts of each
Participant shall be appropriately credited with the
amounts of his Contributions, or the reallocation of his
other Accounts, if any, and his Employer Stock Account
shall be credited with the amount of any Company
Matching Contributions with respect to him. All such
Participants' Contributions, reallocations and Company
Matching Contributions with respect to any month shall
be considered as having been made on the Valuation Date
but subsequent to the valuation for such month provided
for in subsection 6.2(d).
(d) Valuation of Accounts. Each Participant's Accounts
shall be valued and adjusted monthly to preserve for
each Participant his proportionate interest in the
related funds. As of each Valuation Date each of the
Accounts of each Participant shall be adjusted to
reflect the effect of income, collected and accrued,
realized and unrealized profits and losses, expenses and
all other transactions with respect to the related fund
as follows:
(i) The Current Market Value of the assets held in each
of the funds shall be determined by the Trustee,
and
(ii) The separate balances provided for in subsection
6.2(b) of each Participant's Account under each of
the related funds shall be adjusted by multiplying
by the ratio that the Current Market Value of such
fund as determined under subsection 6.2(d)(i) bears
to the aggregate of the Account balances under such
fund.
6.3 Stock Rights, Stock Splits and Stock Dividends. A
Participant shall have no right of request, direction or
demand upon the Committee or the Trustee to exercise in his
behalf rights to purchase shares of Corporation Stock or
other securities of the Corporation. The Trustee, at the
direction of the Committee, shall exercise or sell any rights
to purchase shares of Corporation Stock appertaining to
shares of such stock held by the Trustee and shall sell at
the direction of the Committee any rights to purchase other
securities of the Corporation appertaining to shares of
Corporation Stock held by the Trustee. The Accounts of
Participants shall be appropriately credited. Shares of
Corporation Stock received by the Trustee by reason of a
stock split or a stock dividend shall be appropriately
allocated to the Accounts of the Participants.
6.4 Voting of Corporation Stock. A Participant (or in the case
of his death, his Beneficiary) may direct the voting at each
annual meeting and at each special meeting of the
stockholders of the Corporation of that number of whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding the record date for such meeting. Each such
Participant (or Beneficiary) will be provided with copies of
pertinent proxy solicitation material together with a request
for the Participant's confidential instructions as to how
such shares are to be voted. The Committee shall direct the
Trustee to vote such shares in accordance with such
instructions and shall also direct the Trustee how to vote
any shares of Corporation Stock at any meeting for which it
has not received, or is not subject to receiving such voting
instructions.
6.5 Tender Offers. A Participant (or in the event of his death,
his Beneficiary) may direct the Trustee in writing how to
respond to a tender or exchange offer for any or all whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding such offer. The Committee shall notify each
Participant (or Beneficiary) and exert its best efforts to
timely distribute or cause to be distributed to him such
information as will be distributed to stockholders of the
Corporation in connection with any such tender or exchange
offer. Upon receipt of such instructions, the Trustee shall
tender such shares of Corporation Stock as and to the extent
so instructed. If the Trustee shall not receive instructions
from a Participant (or Beneficiary) regarding any such tender
or exchange offer for such shares of Corporation Stock (or
shall receive instructions not to tender or exchange such
shares), the Trustee shall have no discretion in such matter
and shall take no action with respect thereto. With respect
to shares of Corporation Stock in the K-C Stock Fund for
which the Trustee is not subject to receiving such
instructions, however, the Trustee shall tender such shares
in the same ratio as the number of shares for which it
receives instructions to tender bears to the total number of
shares for which it is subject to receiving instructions, and
shall have no discretion in such matter and shall take no
action with respect thereto other than as specifically
provided in this sentence.
ARTICLE VIII
FORMATION OF WITHDRAWAL YEAR AND MATURED
WITHDRAWAL YEAR; WITHDRAWALS DURING EMPLOYMENT
8.1 Withdrawal Years. A Withdrawal Year shall be formed under
the Plan for the Company Matching Contributions made for each
Plan Year. Each Withdrawal Year shall be and continue to be
identified separately up to the first day of the Plan Year
commencing with the third anniversary of its conclusion.
8.2 Matured Withdrawal Years. A separately identified Matured
Withdrawal Year shall be formed under the Plan to include all
amounts held in the Participants' Employer Accounts as of the
first day of the Plan Year commencing with the third
anniversary of each Withdrawal Year.
8.3 Regular Withdrawals. A Participant, subject to the
conditions stated below, may make the following Regular
Withdrawals:
(a) Such amounts as the Participant may elect from the
Unrestricted After-Tax Contribution Section of his
Accounts;
(b) Such amounts as the Participant may elect from the Basic
After-Tax Contribution Section of his Accounts; and
(c) Such amounts as a Participant who has at least 5 years
of Service or a Participant who was employed by Employer
prior to April 1, 1989, may elect from his Employer
Accounts for the Matured Withdrawal Years. Any
Participant not otherwise described above shall not be
eligible to make withdrawals from his Employer Accounts.
In the event of a Regular Withdrawal from the Basic After-
Tax Contribution section of a Participant's Accounts pursuant
to subsection 8.3(b), such Participant's Contributions under
the Plan shall be suspended for a period of 12 months
following such withdrawal.
8.4 Distribution of Regular Withdrawals. Regular Withdrawals
shall be permitted as of the Valuation Date following Timely
Notice (such Valuation Date being the Settlement Date for
such withdrawals). A distribution of a withdrawal shall be
made not later than 60 days after the Settlement Date or such
other time as specified by Committee rule. A Participant who
is entitled to receive a Regular Withdrawal may on Timely
Notice elect to receive such distribution in the form of
either a Lump Sum Distribution or a Lump Sum Optional
Distribution.
[The following replaces section 8.4 effective September 1, 1994:]
8.4 Distribution of Regular Withdrawals. Regular Withdrawals
shall be permitted as of the Valuation Date following Timely
Notice (such Valuation Date being the Settlement Date for
such withdrawals). A distribution of a withdrawal shall be
made not later than 60 days after the Settlement Date or such
other time as specified by Committee rule. A Participant who
is entitled to receive a Regular Withdrawal may on Timely
Notice elect to receive such distribution in the form of an
All Stock Distribution, a Stock and Cash Distribution or an
All Cash Distribution.
8.5 Miscellaneous.
(a) Notwithstanding anything in this Article VIII to the
contrary, the withdrawal provision of this Article VIII
shall not apply for Terminated Participants.
(b) In the event of the death, prior to his Settlement Date
with respect to the withdrawal, of a Participant who has
elected to make a withdrawal, and if the Committee has
notice of the Participant's death prior to such
distribution, then such withdrawal shall be deemed
revoked. In the event of the death of a Participant on
or after the Settlement Date with respect to which the
Participant has elected to make a withdrawal, but prior
to the actual distribution thereof, and if the Committee
has notice of the Participant's death prior to such
distribution, then such distribution shall be made to
the Participant's Beneficiary by the same method as it
would have been made to the Participant but for his
death.
ARTICLE XII
LIMITATIONS ON BENEFITS
12.1 Definitions and Rules:
(a) Definitions: For purposes of Article XII, the following
definitions and rules of interpretation shall apply.
(i) "Annual Additions" to a Participant's Accounts
under this Plan is the sum, credited to a
Participant's Accounts for any Limitation Year, of:
(A) Company contributions,
(B) forfeitures, if any, and
(C) Participant Contributions.
(ii) "Annual Benefit" -
(A) A benefit which is payable annually in the
form of a straight life annuity under a
defined benefit plan maintained by the Company
which is subject to the limitations of Code
section 415; in the case of such a benefit
which is not payable in the form of a straight
life annuity, the benefit will be adjusted in
accordance with Section 12.1(a)(ii)(C) below.
(B) When there is a transfer of assets or
liabilities from one qualified plan to
another, the Annual Benefit attributable to
the assets transferred shall not be taken into
account by the transferee plan in applying the
limitations of Code section 415. The Annual
Benefit payable on account of the transfer for
any individual that is attributable to the
assets transferred will be equal to the annual
benefit transferred on behalf of such
individual multiplied by a fraction, the
numerator of which is the value of the total
assets transferred and the denominator of
which is the value of the total liabilities
transferred.
(C) In the case of a retirement benefit under a
defined benefit plan subject to the
limitations of Code section 415(b) which is in
any form other than a straight life annuity,
such benefit will be adjusted to a straight
life annuity beginning at the same age which
is the actuarial equivalent of such benefit in
accordance with applicable regulations and
rules determined by the Commissioner, but
without taking into account:
(1) the value of a qualified joint and
survivor annuity (as defined in Code
section 401(a)(11)(G)(iii) and the
regulations thereunder) provided by a
defined benefit plan to the extent that
such value exceeds the sum of (a) the
value of a straight life annuity
beginning on the same date and (b) the
value of any post-retirement death
benefits which would be payable even if
the annuity were not in the form of a
joint and survivor annuity,
(2) the value of benefits that are not
directly related to retirement benefits
(such as, but not limited to, pre-
retirement disability and death
benefits), and
(3) the value of benefits provided by a
defined benefit plan which reflect post-
retirement cost of living increases to
the extent that such increases are in
accordance with Code section 415(d) and
the regulations thereunder.
(D) In the case of a retirement benefit beginning
before the Social Security Retirement Age
under a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(E) If a Participant has less than 10 Years of
Vesting Service with the Company at the time
the Participant begins to receive retirement
benefits under a defined benefit plan, the
benefit limitations described in Code section
415(b)(1) and (4) are to be reduced by
multiplying the otherwise applicable
limitation by a fraction, the numerator of
which is the number of Years of Vesting
Service with the Company as of, and including,
the current Limitation Year, and the
denominator of which is 10. For purposes of
this paragraph (E), Years of Vesting Service
shall be determined in accordance with such
defined benefit plan.
(F) In the case of a retirement benefit beginning
after the Social Security Retirement Age under
a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(G) For purposes of this Section, the "Social
Security Retirement Age" shall mean the age
used as the retirement age under section
216(l) of the Social Security Act, applied
without regard to the age increase factor and
as if the early retirement age under section
216(l)(2) of the Social Security Act were 62.
(iii) "Company" - any corporation which is a
member of a controlled group of corporations (as
defined in Code section 414(b) and modified by
section 415(h)) or an affiliated service group (as
defined in Code section 414(m)) which includes an
Employer; any trades or businesses (whether or not
incorporated) which are under common control (as
defined in Code section 414(c) and modified by Code
section 415(h)) with an Employer; or any other
entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(iv) "Compensation" with respect to a Limitation Year -
(A) includes amounts actually paid or made
available to a Participant (regardless of
whether he was such during the entire
Limitation Year);
(1) as wages, salaries, fees for professional
service, and other amounts received for
personal services actually rendered in
the course of employment with the Company
including but not limited to commissions,
compensation for services on the basis of
a percentage of profits and bonuses;
(2) for purposes of (i) above, earned income
from sources outside the United States
(as defined in Code section 911(b));
whether or not excludable from gross
income under Code section 911 or
deductible under Code section 913;
(3) amounts described in Code sections
104(a)(3), 105(a) and 105(h) but only to
the extent that these amounts are
includable in the gross income of the
Participant;
(4) amounts paid or reimbursed by the Company
for moving expenses incurred by the
Participant, but only to the extent that
these amounts are not deductible by the
Participant under Code section 217;
(5) value of a nonqualified stock option
granted to the Participant, but only to
the extent that the value of the option
is includable in the gross income of the
Participant in the taxable year in which
granted;
(6) the amount includable in the gross income
of a Participant upon making the election
described in Code section 83(b).
(B) excludes -
(1) contributions made by the Company to a
plan of deferred compensation to the
extent that, before the application of
the Code section 415 limitations to that
plan, the contributions are not
includable in the gross income of the
Participant for the taxable year in which
contributed and any distributions from a
plan of deferred compensation, regardless
of whether such amounts are includable in
the gross income of the Participant when
distributed; provided, however, any
amounts received by a Participant
pursuant to an unfunded nonqualified plan
shall be considered as Compensation in
the year such amounts are includable in
the gross income of the Participant;
(2) amounts realized from the exercise of a
nonqualified stock option, or recognized
when restricted stock (or property) held
by a Participant either becomes freely
transferable or is no longer subject to a
substantial risk of forfeiture pursuant
to Code section 83 and the regulations
thereunder;
(3) amounts realized from the sale, exchange
or other disposition of stock acquired
under a qualified stock option;
(4) other amounts which receive special tax
benefits such as premiums for group term
life insurance (but only to the extent
that the premiums are not includable in
the gross income of the Participant); and
(5) Compensation in excess of $200,000 (as
automatically increased in accordance
with applicable regulations to reflect
cost-of-living adjustments).
(v) "Limitation Year" - a calendar year.
(vi) "Maximum Permissible Amount" -
(A) for a Limitation Year, with respect to any
Participant, subject to the rule in
paragraph (B), the lesser of
(1) $30,000 (or, if greater, 1/4 of the
dollar limitation in effect under Code
section 415(b)(1)(A)), or
(2) 25% of the Participant's Compensation for
the Limitation Year.
(B) As of January 1 of each calendar year, the
dollar limitation set forth in subparagraph
(A)(1) above shall be adjusted automatically
for cost-of-living increases to equal the
dollar limitation as determined by the
Commissioner for that calendar year under Code
section 415(d)(1)(B). This adjusted dollar
limitation applies for the Limitation Year
ending with that calendar year.
(vii) "Projected Annual Benefit" - the Annual Benefit to
which a Participant would be entitled under a
defined benefit plan maintained by the Company on
the assumptions that he or she continues employment
until the normal retirement age (or current age, if
that is later) thereunder, that his or her
Compensation continues at the same rate as in
effect for the Limitation Year under consideration
until such age, and that all other relevant factors
used to determine benefits under the Plan remain
constant as of the current Limitation Year for all
future Limitation Years.
(b) Other Rule. For purposes of applying the limitations of
Code section 415(b), (c) and (e) applicable to a
Participant for a particular Limitation Year, all
qualified defined contribution plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as part of this Plan and all
qualified defined benefit plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as one defined benefit plan.
12.2 Limits:
(a) Annual Addition Limit. The amount of the Annual
Addition which may be credited under this Plan to any
Participant's Accounts as of any allocation date shall
not exceed the Maximum Permissible Amount (based upon
his Compensation up to such allocation date) reduced by
the sum of any Annual Additions made to the
Participant's Accounts under this Plan as of any
preceding allocation date within the Limitation Year.
If an allocation date of this Plan coincides with an
allocation date of any other qualified defined
contribution plan maintained by the Company, the amount
of the Annual Additions which may be credited under this
Plan to any Participant's Accounts as of such date shall
be an amount equal to the product of the amount to be
credited under this Plan without regard to this Section
12.2 multiplied by the lesser of 1.0 or a fraction, the
numerator of which is the amount described in this
subsection (a) of Section 12.2 during the Limitation
Year and the denominator of which is the amount that
would otherwise be credited on this allocation date
under all plans without regard to this Section 12.2. If
contributions to this Plan by or on behalf of a
Participant are to be reduced as a result of this
Section 12.2, such reduction shall be effected by first
reducing any Unrestricted After-Tax Contributions and
then, if necessary, by proportionately reducing Company
Matching Contributions and any Basic After-Tax
Contributions. If as a result of a reasonable error in
estimating a Participant's Compensation, or under the
limited facts and circumstances which the Commissioner
finds justify the availability of the rules set forth in
this Section 12.2, the allocation of Annual Additions
under the terms of the Plan for a particular Participant
would cause the limitations of Code section 415
applicable to that Participant for the Limitation Year
to be exceeded, the excess amounts shall not be deemed
to be Annual Additions in that Limitation Year if they
are treated as follows:
(i) The excess amounts in the Participant's Account
consisting of Participant Contributions and any
increment attributable thereto shall be paid to the
Participant as soon as administratively feasible.
(ii) The excess amounts in the Participant's Account
consisting of Company Matching Contributions shall
be used to reduce Company Matching Contributions
for the next Limitation Year (and succeeding
Limitation Years, as necessary) for that
Participant if that Participant is covered by the
Plan as of the end of the Limitation Year.
However, if that Participant is not covered by the
Plan as of the end of the Limitation Year then the
excess amounts must be held unallocated in a
suspense account for the Limitation Year and
allocated and reallocated in the next Limitation
Year to all of the remaining Participants in the
Plan. If a suspense account is in existence at any
time during a particular Limitation Year, other
than the first Limitation Year described in the
preceding sentence, all amounts in the suspense
account must be allocated and reallocated to
Participant's Accounts (subject to the limitations
of Code section 415) before any Company Matching
Contributions and Participant Contributions which
would constitute Annual Additions may be made to
the Plan for that Limitation Year and such excess
amounts must be used to reduce Company Matching
Contributions for the next Limitation Year (and
succeeding Limitation Plan Years, as necessary) for
all of the remaining Participants in the Plan. For
purposes of this subdivision, excess amounts may
not be distributed to Participants or former
Participants.
(iii) In the event of termination of the Plan the
suspense account described in (ii) above shall
revert to the Employer to the extent it may not
then be allocated to any Participant's Account.
(iv) Notwithstanding any other provision in this Section
12.2, the Employer shall not contribute any amount
that would cause an allocation to the suspense
account as of the date the contribution is
allocated. If the contribution is made prior to
the date as of which it is to be allocated, then
such contribution shall not exceed an amount that
would cause an allocation to the suspense account
if the date of contribution were an allocation
date.
(b) Overall Limit. For any Participant of this Plan who at
any time participated in a defined benefit plan
maintained by the Company, the rate of benefit accrual
by such Participant in each defined benefit plan in
which the Participant participates during the Limitation
Year will be reduced to the extent necessary to prevent
the sum of the following fractions, computed as of the
close of the Limitation Year, from exceeding 1.0:
(i) The Projected Annual Benefit of the Participant
under the defined benefit plan
over
The lesser of (1) the product of 1.25 multiplied by
the dollar limitation in effect under Code section
415(b)(1)(A) for such Limitation Year or (2) the
product of 1.4 multiplied by the amount which may
be taken into account under Code section
415(b)(1)(B) with respect to such Participant for
such Limitation Year,
plus
(ii) The sum of Annual Additions to such Participant's
Accounts under this Plan in such Limitation Year
and for all prior Limitation Years
over
The sum of the lesser of the following amounts
determined for such year and for each prior year of
service with the Company: (1) the product of 1.25
multiplied by the dollar limitation in effect under
Code section 415(c)(1)(A) for such Limitation Year
or (2) the product of 1.4 multiplied by 25% of the
Participant's Compensation for such Limitation
Year.
(c) Special Rules Applicable to Computation of Overall
Limit.
(i) For purposes of applying the defined contribution
plan fraction in Section 12.2(b), for any
Limitation Year beginning after December 31, 1975,
the following rules shall apply with respect to
Limitation Years before January 1, 1976:
(A) The aggregate amount taken into account in
determining the numerator of such fraction is
deemed not to exceed the aggregate amount
taken into account in determining the
denominator of the fraction.
(B) The amount taken into account for purposes of
subsection 12.1(a)(i)(C)(1) is an amount equal
to the excess of the aggregate amount of the
Participant's contributions for such years
during which he was an active participant in
the Plan over 10% of the Participant's
aggregate Compensation for all such years,
multiplied by a fraction, the numerator of
which is 1.0 and the denominator of which is
the number of years beginning before
January 1, 1976, during which the Participant
participated in the Plan. Participant
contributions made on or after October 2,
1973, shall be taken into account for purposes
of the preceding sentence only to the extent
that the amount of such contributions was
permissible under a plan as in effect on that
date.
(ii) In any case where the sum of the fractions in
Section 12.2(b) is greater than 1.0 calculated as
of the close of the last Limitation Year beginning
before January 1, 1983 for a Participant in
accordance with regulations prescribed by the
Commissioner pursuant to Section 235(g)(3) of the
Tax Equity and Fiscal Responsibility Act of 1982,
an amount shall be subtracted from the numerator of
the defined contribution plan fraction so that the
sum of such fractions does not exceed 1.0 for such
Limitation Year.
KIMBERLY-CLARK CORPORATION
SALARIED EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE III
(As amended through May 24, 1994)
(Corinth Mills)
With respect to the Participating Unit under this Schedule, as set
forth in Appendix A, the Plan shall apply with full force and
effect except that Articles II, III, IV, VI, VIII and XII of this
Schedule shall apply in lieu of the same numbered Articles of the
Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employees for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic After-Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Salary Rate: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of regular earnings
while a Participant. Base Salary Rate shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Salary Rate under the Plan shall not
exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee has completed an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires, or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board of Directors of the Corporation)
shall be the Named Fiduciary of the Plan as defined in
ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each 12 calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Regular Unrestricted After-Tax Contributions: After-
Tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(zz) Service: Regular employment with the Corporation, a
Subsidiary or any Equity Company.
(aaa) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(bbb) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ccc) Special Unrestricted After-Tax Contributions: Special
Contributions which are made under subsection 3.2(c).
(ddd) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(eee) Terminated Participant: A Participant who has
terminated his employment with an Employer and the
aggregate value of the Participant's Accounts exceeds
$3,500 and who has not elected to receive a distribution
under the Plan.
(fff) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(ggg) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(hhh) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(iii) Trust: The Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan Trust pursuant to
the trust agreement provided for in Article V.
(jjj) Trustee: The trustee under the Trust.
(kkk) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(lll) Valuation Date: The last day of each month.
(mmm) Withdrawal Year: As defined in Section 8.1.
(nnn) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employees for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic After-Tax Contributions (including amounts
recharacterized as Basic After-Tax Contributions
under subsection 3.5(b)(iii)), and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year (but only
to the extent that such Contributions and Company
Matching Contributions are not considered for
purposes of Section 2.1(c) hereof), together with
qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For the purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in subsection 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Salary Rate: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of regular earnings
while a Participant. Base Salary Rate shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Salary Rate under the Plan shall not
exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation, or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by or
on behalf of Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (v), (w), (x) and (y) of this Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of this Section
2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1. He remains a
Participant until all of his Accounts have been
distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(zz) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(aaa) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(bbb) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.,
disability, leave of absence, or layoff, etc.)
(ccc) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(ddd) Stock and Cash Distribution: As defined in subsection
7.3(b).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising
out of any injury or disease which the Committee
determines is permanent and prevents a Participant from
engaging in any occupation with the Corporation, a
Subsidiary or an Equity Company commensurate with his
education, training and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan Trust pursuant to
the trust agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan, and any Employee contributions, as
defined in Code Section 401(m) and the regulations
thereunder, contributed prior to April 1, 1990, on
account of which a Company Matching Contribution was
made to this Plan on behalf of a Participant who was
employed prior to April 1, 1989.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE III
PARTICIPATION, CONTRIBUTIONS, AND ALLOCATIONS
3.1 Election to Participate. An Eligible Employee's election to
participate in the Plan shall, if given on Timely Notice,
(i) be effective as of the first Entry Date following his
election, and
(ii) remain in effect as a valid election to participate for
each successive Plan Year.
An election to participate by an Eligible Employee who,
immediately prior to becoming an Eligible Employee, was a
participant under the Kimberly-Clark Corporation Hourly
Employees Incentive Investment Plan shall be effective as
soon as administratively feasible upon exercising his
election.
3.2 Amount of Contributions by Participants.
(a) Basic After-Tax Contributions: During each Plan Year
Basic After-Tax Contributions shall be made by a
Participant for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 2%, 3%,
4%, 5% or 6% of his Base Salary Rate.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice a
Participant may change his election effective as of the
first day of any month.
[The following replaces section 3.2(a) effective January 1, 1995:]
(a) Basic After-Tax Contributions. During each Plan Year,
Basic After-Tax Contributions shall be made by a
Participant for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 1%, 2%,
3%, 4%, 5% or 6% of his Base Salary Rate.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice, a
Participant may change his election effective as of the
first day of any month.
(b) Regular Unrestricted After-Tax Contributions.
(i) A Participant may elect on Timely Notice to make
Regular Unrestricted After-Tax Contributions to his
Account in any whole percentage equal to an amount
which is not less than 1% of his Base Salary Rate
and not more than 6% of his Base Salary Rate.
(ii) An election to make Regular Unrestricted After-Tax
Contributions by regular payroll deduction shall
remain in effect for so long as a Participant is
eligible to make Regular Unrestricted After-Tax
Contributions or, if earlier, until changed by a
Participant. A Participant may change such
election on Timely Notice effective as of the first
day of any month.
(iii) Regular Unrestricted After-Tax Contributions will
not be taken into account in determining the amount
of Company Matching Contributions made on behalf of
Participants.
(c) Special Unrestricted After-Tax Contributions. Once each
Plan Year a Participant may elect to make a Special
Unrestricted After-Tax Contribution in excess of the
amount elected under subsection 3.2(b)(i) in an amount
(i) which is elected by him on Timely Notice,
(ii) which, when added to the total of Regular
Unrestricted After-Tax Contributions made by the
Participant to date in the Plan Year, would not
exceed 6% of his Base Salary Rate for those periods
to date in such Plan Year during which Basic
After-Tax Contributions have been made;
(iii) which shall only be made in cash; and
(iv) which will not be taken into account in determining
the amount of Company Matching Contributions made
on behalf of the Participant.
3.3 General Limitation: Notwithstanding any other provision of
this Article III, no Contribution shall be made to the Plan
which would cause the Plan to fail to meet the requirements
for exemption from tax or to violate any provisions of the
Code.
3.4 Allocation of Contributions by Participants.
Basic After-Tax Contributions and Unrestricted After-Tax
Contributions: On Timely Notice a Participant shall elect to
allocate in whole multiples of 1% all of his Basic After-Tax
Contributions and Unrestricted After-Tax Contributions to be
made during a Plan Year to one or more of
(i) the Government Fund,
(ii) the Diversified Fund,
(iii) the Fixed Income Fund, or
(iv) the K-C Stock Fund.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice a
Participant may change his election effective as of the first
day of any month.
3.5 Suspension of All Contributions. On Timely Notice and
notwithstanding the provisions of Section 3.2, a Participant
may elect to suspend, effective reasonably soon after such
notice is given as established by Committee rule, all of his
Contributions. On Timely Notice, a Participant may elect to
resume such Contributions, or have such Contributions
resumed, as of any Entry Date, provided, however, that any
such suspension must be for a period of not less than three
months.
A Participant's Contributions and Contributions made on his
behalf shall be automatically suspended commencing with and
continuing throughout any period during which he fails to
qualify as an Eligible Employee. On Timely Notice upon
requalifying as an Eligible Employee a Participant may elect
to make Contributions to his Accounts as soon as
administratively possible.
3.6 Payment of Contributions to Trustee. The Employers shall
contribute or remit to the Trustee as soon as practicable
after the end of each month the amounts withheld from the
Participants' compensation during the month as Contributions
under the Plan.
3.7 Reallocation of Participant's Accounts. A Participant who
has remained a Participant for at least three months may on
Timely Notice elect to reallocate, effective as of the first
Valuation Date following his election, all or any whole
percentage portion of any of his Employee Accounts or
Employer Accounts or both, provided he has not elected a
reallocation within the preceding three months; provided,
however, that a three month period that begins at the end of
a Plan Year shall not be more than ninety (90) days.
3.8 Redeposits and Restored Amounts.
(a) Notwithstanding any provision in this Plan to the
contrary, on Timely Notice, an Employee who has
forfeited all or a portion of his Employer Accounts may,
within 5 years of the date of the distribution or
withdrawal which caused such forfeiture, redeposit such
distribution or withdrawal, and upon such redeposit, the
amount of the forfeiture associated with the redeposit
shall be restored to the Employee's Employer Stock
Account (and to the Withdrawal Year) from which it was
forfeited. Redeposits shall be allocated to the Plan
funds in the same manner as Basic After-Tax
Contributions made by the Participant. Redeposits shall
be made on a Withdrawal Year by Withdrawal Year basis,
beginning with the most remotely ended Withdrawal Year,
and the amount redeposited for any Withdrawal Year shall
be equal to the amount distributed or withdrawn which
caused the forfeiture for that Withdrawal Year.
For an Employee hired after March 31, 1989, the amount
redeposited shall be equal to the total amount
distributed or withdrawn which caused the forfeiture.
(b) No redeposit of a withdrawal or distribution shall be
permitted if, coincident with or subsequent to the
forfeiture associated with that withdrawal or
distribution, an Employee incurs 5 consecutive One-Year
Periods of Severance. For Plan Years prior to April 1,
1989, and for purposes of this Section 3.8 only, an
Employee incurs a One-Year Period of Severance if he is
not an Employee on the last day of a Plan Year.
(c) Where applicable, if an Employee receives such a
distribution or makes a withdrawal that results in a
forfeiture, and if such Employee does not make a
redeposit of such amount within the same Plan Year, any
Plan Year between the Plan Year of distribution or
withdrawal and the Plan Year of redeposit (including the
Plan Year of distribution or withdrawal but not
including the Plan Year of redeposit) shall not be
counted in determining when the restored amounts are
attributable to a Withdrawal Year or Matured Withdrawal
Years.
(d) Notwithstanding the preceding provision, a Participant
who is entitled to no portion of his Employer Account
upon termination of employment shall be deemed to have
received a distribution of zero dollars ($0) from such
account at the earliest possible date provided under
Section 7.2.
(e) Any forfeiture from the Basic After-Tax Contribution
section of his Employer Accounts under subsection 7.1(f)
and the applicable years of Service shall be restored in
accordance with the provisions of this Section 3.8 if
the Terminated Participant returns to his employment
with an Employer prior to incurring 5 consecutive One-
Year Periods of Severance.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.3, Company
Matching Contributions for each Plan Year shall be 50% of
Basic After-Tax Contributions for that Plan Year allocated to
the K-C Stock Fund and 20% of Basic After-Tax Contributions
for that Plan Year allocated to the Government Fund, the
Diversified Fund or the Fixed Income Fund.
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.3 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if, in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.4 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.4(a)(i) shall be determined in the
manner set forth in subsection 4.4(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.4(a)(i)
above.
ARTICLE VI
INVESTMENT, PARTICIPANT'S ACCOUNTS, AND VOTING OF STOCK
6.1 Investment of Contributions.
(a) A Participant's Contributions during each Plan Year
shall be invested in the various funds in accordance
with the Participant's allocations under Section 3.4. A
Participant's interest arising from his reallocation for
prior Plan Years shall be invested in the various funds
in accordance with the Participant's directions under
Section 3.7. Company Matching Contributions during each
Plan Year shall be invested in the K-C Stock Fund. All
such investments and gains or losses related thereto
shall be allocated to each Participant's Accounts
pursuant to the provisions of Section 6.2.
(b) The Committee shall designate Participants'
Contributions and Company Matching Contributions for
payment to the Trustee for investment, and Employee
Accounts and Employer Accounts for reallocation in
accordance with subsection 6.1(a), and shall advise the
Trustee of such designation.
6.2 Participant's Accounts.
(a) Establishment of Accounts. Each Participant shall have
established and maintained for him separate Accounts
which, depending upon the allocation and reallocation
options he has selected, shall consist of Employee
Accounts and Employer Accounts in one or more of the
Government Fund, the Diversified Fund, the Fixed Income
Fund, and the K-C Stock Fund. Each such Employee
Account shall be subdivided into a Basic After-Tax
Contribution and Unrestricted After-Tax Contribution
Section. Each such Employer Account shall be subdivided
into subsections corresponding to the Sections of the
Employee Accounts, other than the Unrestricted After-
Tax Contribution Section.
As soon as practicable following the end of each Plan
Year, the Committee will cause an annual statement to be
prepared for each Participant which will reflect the
status of the Participant's Accounts in such form as
shall be prescribed by the Committee.
(b) Separation of Accounts. Each Participant's Accounts
shall be further separated and maintained as Withdrawal
Years and Matured Withdrawal Years as set forth in
Sections 8.1 and 8.2.
(c) Crediting of Accounts. As of the close of business on
each Valuation Date the designated Accounts of each
Participant shall be appropriately credited with the
amounts of his Contributions, or the reallocation of his
other Accounts, if any, and his Employer Stock Account
shall be credited with the amount of any Company
Matching Contributions with respect to him. All such
Participants' Contributions, reallocations and Company
Matching Contributions with respect to any month shall
be considered as having been made on the Valuation Date
but subsequent to the valuation for such month provided
for in subsection 6.2(d).
(d) Valuation of Accounts. Each Participant's Accounts
shall be valued and adjusted monthly to preserve for
each Participant his proportionate interest in the
related funds. As of each Valuation Date each of the
Accounts of each Participant shall be adjusted to
reflect the effect of income, collected and accrued,
realized and unrealized profits and losses, expenses and
all other transactions with respect to the related fund
as follows:
(i) The Current Market Value of the assets held in each
of the funds shall be determined by the Trustee,
and
(ii) The separate balances provided for in subsection
6.2(b) of each Participant's Account under each of
the related funds shall be adjusted by multiplying
by the ratio that the Current Market Value of such
fund as determined under subsection 6.2(d)(i) bears
to the aggregate of the Account balances under such
fund.
6.3 Stock Rights, Stock Splits and Stock Dividends. A
Participant shall have no right of request, direction or
demand upon the Committee or the Trustee to exercise in his
behalf rights to purchase shares of Corporation Stock or
other securities of the Corporation. The Trustee, at the
direction of the Committee, shall exercise or sell any rights
to purchase shares of Corporation Stock appertaining to
shares of such stock held by the Trustee and shall sell at
the direction of the Committee any rights to purchase other
securities of the Corporation appertaining to shares of
Corporation Stock held by the Trustee. The Accounts of
Participants shall be appropriately credited. Shares of
Corporation Stock received by the Trustee by reason of a
stock split or a stock dividend shall be appropriately
allocated to the Accounts of the Participants.
6.4 Voting of Corporation Stock. A Participant (or in the case
of his death, his Beneficiary) may direct the voting at each
annual meeting and at each special meeting of the
stockholders of the Corporation of that number of whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding the record date for such meeting. Each such
Participant (or Beneficiary) will be provided with copies of
pertinent proxy solicitation material together with a request
for the Participant's confidential instructions as to how
such shares are to be voted. The Committee shall direct the
Trustee to vote such shares in accordance with such
instructions and shall also direct the Trustee how to vote
any shares of Corporation Stock at any meeting for which it
has not received, or is not subject to receiving such voting
instructions.
6.5 Tender Offers. A Participant (or in the event of his death,
his Beneficiary) may direct the Trustee in writing how to
respond to a tender or exchange offer for any or all whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding such offer. The Committee shall notify each
Participant (or Beneficiary) and exert its best efforts to
timely distribute or cause to be distributed to him such
information as will be distributed to stockholders of the
Corporation in connection with any such tender or exchange
offer. Upon receipt of such instructions, the Trustee shall
tender such shares of Corporation Stock as and to the extent
so instructed. If the Trustee shall not receive instructions
from a Participant (or Beneficiary) regarding any such tender
or exchange offer for such shares of Corporation Stock (or
shall receive instructions not to tender or exchange such
shares), the Trustee shall have no discretion in such matter
and shall take no action with respect thereto. With respect
to shares of Corporation Stock in the K-C Stock Fund for
which the Trustee is not subject to receiving such
instructions, however, the Trustee shall tender such shares
in the same ratio as the number of shares for which it
receives instructions to tender bears to the total number of
shares for which it is subject to receiving instructions, and
shall have no discretion in such matter and shall take no
action with respect thereto other than as specifically
provided in this sentence.
ARTICLE VIII
FORMATION OF WITHDRAWAL YEAR AND MATURED
WITHDRAWAL YEAR; WITHDRAWALS DURING EMPLOYMENT
8.1 Withdrawal Years. A Withdrawal Year shall be formed under
the Plan for the Company Matching Contributions made for each
Plan Year. Each Withdrawal Year shall be and continue to be
identified separately up to the first day of the Plan Year
commencing with the third anniversary of its conclusion.
8.2 Matured Withdrawal Years. A separately identified Matured
Withdrawal Year shall be formed under the Plan to include all
amounts held in the Participants' Employer Accounts as of the
first day of the Plan Year commencing with the third
anniversary of each Withdrawal Year.
8.3 Regular Withdrawals. A Participant, subject to the
conditions stated below, may make the following Regular
Withdrawals:
(a) Such amounts as the Participant may elect from the
Unrestricted After-Tax Contribution Section of his
Accounts;
(b) Such amounts as the Participant may elect from the Basic
After-Tax Contribution Section of his Accounts; and
(c) Such amounts as a Participant who has at least 5 years
of Service or a Participant who was employed by Employer
prior to April 1, 1989, may elect from his Employer
Accounts for the Matured Withdrawal Years. Any
Participant not otherwise described above shall not be
eligible to make withdrawals from his Employer Accounts.
In the event of a Regular Withdrawal from the Basic After-
Tax Contribution section of a Participant's Accounts pursuant
to subsection 8.3(b), such Participant's Contributions under
the Plan shall be suspended for a period of 12 months
following such withdrawal.
8.4 Distribution of Regular Withdrawals. Regular Withdrawals
shall be permitted as of the Valuation Date following Timely
Notice (such Valuation Date being the Settlement Date for
such withdrawals). A distribution of a withdrawal shall be
made not later than 60 days after the Settlement Date or such
other time as specified by Committee rule. A Participant who
is entitled to receive a Regular Withdrawal may on Timely
Notice elect to receive such distribution in the form of
either a Lump Sum Distribution or a Lump Sum Optional
Distribution.
[The following replaces section 8.4 effective September 1, 1994:]
8.4 Distribution of Regular Withdrawals. Regular Withdrawals
shall be permitted as of the Valuation Date following Timely
Notice (such Valuation Date being the Settlement Date for
such withdrawals). A distribution of a withdrawal shall be
made not later than 60 days after the Settlement Date or such
other time as specified by Committee rule. A Participant who
is entitled to receive a Regular Withdrawal may on Timely
Notice elect to receive such distribution in the form of an
All Stock Distribution, a Stock and Cash Distribution or an
All Cash Distribution.
8.5 Miscellaneous.
(a) Notwithstanding anything in this Article VIII to the
contrary, the withdrawal provision of this Article VIII
shall not apply for Terminated Participants.
(b) In the event of the death, prior to his Settlement Date
with respect to the withdrawal, of a Participant who has
elected to make a withdrawal, and if the Committee has
notice of the Participant's death prior to such
distribution, then such withdrawal shall be deemed
revoked. In the event of the death of a Participant on
or after the Settlement Date with respect to which the
Participant has elected to make a withdrawal, but prior
to the actual distribution thereof, and if the Committee
has notice of the Participant's death prior to such
distribution, then such distribution shall be made to
the Participant's Beneficiary by the same method as it
would have been made to the Participant but for his
death.
ARTICLE XII
LIMITATIONS ON BENEFITS
12.1 Definitions and Rules:
(a) Definitions: For purposes of Article XII, the following
definitions and rules of interpretation shall apply.
(i) "Annual Additions" to a Participant's Accounts
under this Plan is the sum, credited to a
Participant's Accounts for any Limitation Year, of:
(A) Company contributions,
(B) forfeitures, if any, and
(C) Participant Contributions.
(ii) "Annual Benefit" -
(A) A benefit which is payable annually in the
form of a straight life annuity under a
defined benefit plan maintained by the Company
which is subject to the limitations of Code
section 415; in the case of such a benefit
which is not payable in the form of a straight
life annuity, the benefit will be adjusted in
accordance with Section 12.1(a)(ii)(C) below.
(B) When there is a transfer of assets or
liabilities from one qualified plan to
another, the Annual Benefit attributable to
the assets transferred shall not be taken into
account by the transferee plan in applying the
limitations of Code section 415. The Annual
Benefit payable on account of the transfer for
any individual that is attributable to the
assets transferred will be equal to the annual
benefit transferred on behalf of such
individual multiplied by a fraction, the
numerator of which is the value of the total
assets transferred and the denominator of
which is the value of the total liabilities
transferred.
(C) In the case of a retirement benefit under a
defined benefit plan subject to the
limitations of Code section 415(b) which is in
any form other than a straight life annuity,
such benefit will be adjusted to a straight
life annuity beginning at the same age which
is the actuarial equivalent of such benefit in
accordance with applicable regulations and
rules determined by the Commissioner, but
without taking into account:
(1) the value of a qualified joint and
survivor annuity (as defined in Code
section 401(a)(11)(G)(iii) and the
regulations thereunder) provided by a
defined benefit plan to the extent that
such value exceeds the sum of (a) the
value of a straight life annuity
beginning on the same date and (b) the
value of any post-retirement death
benefits which would be payable even if
the annuity were not in the form of a
joint and survivor annuity,
(2) the value of benefits that are not
directly related to retirement benefits
(such as, but not limited to, pre-
retirement disability and death
benefits), and
(3) the value of benefits provided by a
defined benefit plan which reflect post-
retirement cost of living increases to
the extent that such increases are in
accordance with Code section 415(d) and
the regulations thereunder.
(D) In the case of a retirement benefit beginning
before the Social Security Retirement Age
under a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(E) If a Participant has less than 10 Years of
Vesting Service with the Company at the time
the Participant begins to receive retirement
benefits under a defined benefit plan, the
benefit limitations described in Code section
415(b)(1) and (4) are to be reduced by
multiplying the otherwise applicable
limitation by a fraction, the numerator of
which is the number of Years of Vesting
Service with the Company as of, and including,
the current Limitation Year, and the
denominator of which is 10. For purposes of
this paragraph (E), Years of Vesting Service
shall be determined in accordance with such
defined benefit plan.
(F) In the case of a retirement benefit beginning
after the Social Security Retirement Age under
a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(G) For purposes of this Section, the "Social
Security Retirement Age" shall mean the age
used as the retirement age under section
216(l) of the Social Security Act, applied
without regard to the age increase factor and
as if the early retirement age under section
216(l)(2) of the Social Security Act were 62.
(iii) "Company" - any corporation which is a
member of a controlled group of corporations (as
defined in Code section 414(b) and modified by
section 415(h)) or an affiliated service group (as
defined in Code section 414(m)) which includes an
Employer; any trades or businesses (whether or not
incorporated) which are under common control (as
defined in Code section 414(c) and modified by Code
section 415(h)) with an Employer; or any other
entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(iv) "Compensation" with respect to a Limitation Year -
(A) includes amounts actually paid or made
available to a Participant (regardless of
whether he was such during the entire
Limitation Year);
(1) as wages, salaries, fees for professional
service, and other amounts received for
personal services actually rendered in
the course of employment with the Company
including but not limited to commissions,
compensation for services on the basis of
a percentage of profits and bonuses;
(2) for purposes of (i) above, earned income
from sources outside the United States
(as defined in Code section 911(b));
whether or not excludable from gross
income under Code section 911 or
deductible under Code section 913;
(3) amounts described in Code sections
104(a)(3), 105(a) and 105(h) but only to
the extent that these amounts are
includable in the gross income of the
Participant;
(4) amounts paid or reimbursed by the Company
for moving expenses incurred by the
Participant, but only to the extent that
these amounts are not deductible by the
Participant under Code section 217;
(5) value of a nonqualified stock option
granted to the Participant, but only to
the extent that the value of the option
is includable in the gross income of the
Participant in the taxable year in which
granted;
(6) the amount includable in the gross income
of a Participant upon making the election
described in Code section 83(b).
(B) excludes -
(1) contributions made by the Company to a
plan of deferred compensation to the
extent that, before the application of
the Code section 415 limitations to that
plan, the contributions are not
includable in the gross income of the
Participant for the taxable year in which
contributed and any distributions from a
plan of deferred compensation, regardless
of whether such amounts are includable in
the gross income of the Participant when
distributed; provided, however, any
amounts received by a Participant
pursuant to an unfunded nonqualified plan
shall be considered as Compensation in
the year such amounts are includable in
the gross income of the Participant;
(2) amounts realized from the exercise of a
nonqualified stock option, or recognized
when restricted stock (or property) held
by a Participant either becomes freely
transferable or is no longer subject to a
substantial risk of forfeiture pursuant
to Code section 83 and the regulations
thereunder;
(3) amounts realized from the sale, exchange
or other disposition of stock acquired
under a qualified stock option;
(4) other amounts which receive special tax
benefits such as premiums for group term
life insurance (but only to the extent
that the premiums are not includable in
the gross income of the Participant); and
(5) Compensation in excess of $200,000 (as
automatically increased in accordance
with applicable regulations to reflect
cost-of-living adjustments).
(v) "Limitation Year" - a calendar year.
(vi) "Maximum Permissible Amount" -
(A) for a Limitation Year, with respect to any
Participant, subject to the rule in
paragraph (B), the lesser of
(1) $30,000 (or, if greater, 1/4 of the
dollar limitation in effect under Code
section 415(b)(1)(A)), or
(2) 25% of the Participant's Compensation for
the Limitation Year.
(B) As of January 1 of each calendar year, the
dollar limitation set forth in subparagraph
(A)(1) above shall be adjusted automatically
for cost-of-living increases to equal the
dollar limitation as determined by the
Commissioner for that calendar year under Code
section 415(d)(1)(B). This adjusted dollar
limitation applies for the Limitation Year
ending with that calendar year.
(vii) "Projected Annual Benefit" - the Annual Benefit to
which a Participant would be entitled under a
defined benefit plan maintained by the Company on
the assumptions that he or she continues employment
until the normal retirement age (or current age, if
that is later) thereunder, that his or her
Compensation continues at the same rate as in
effect for the Limitation Year under consideration
until such age, and that all other relevant factors
used to determine benefits under the Plan remain
constant as of the current Limitation Year for all
future Limitation Years.
(b) Other Rule. For purposes of applying the limitations of
Code section 415(b), (c) and (e) applicable to a
Participant for a particular Limitation Year, all
qualified defined contribution plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as part of this Plan and all
qualified defined benefit plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as one defined benefit plan.
12.2 Limits:
(a) Annual Addition Limit. The amount of the Annual
Addition which may be credited under this Plan to any
Participant's Accounts as of any allocation date shall
not exceed the Maximum Permissible Amount (based upon
his Compensation up to such allocation date) reduced by
the sum of any Annual Additions made to the
Participant's Accounts under this Plan as of any
preceding allocation date within the Limitation Year.
If an allocation date of this Plan coincides with an
allocation date of any other qualified defined
contribution plan maintained by the Company, the amount
of the Annual Additions which may be credited under this
Plan to any Participant's Accounts as of such date shall
be an amount equal to the product of the amount to be
credited under this Plan without regard to this Section
12.2 multiplied by the lesser of 1.0 or a fraction, the
numerator of which is the amount described in this
subsection (a) of Section 12.2 during the Limitation
Year and the denominator of which is the amount that
would otherwise be credited on this allocation date
under all plans without regard to this Section 12.2. If
contributions to this Plan by or on behalf of a
Participant are to be reduced as a result of this
Section 12.2, such reduction shall be effected by first
reducing any Unrestricted After-Tax Contributions and
then, if necessary, by proportionately reducing Company
Matching Contributions and any Basic After-Tax
Contributions. If as a result of a reasonable error in
estimating a Participant's Compensation, or under the
limited facts and circumstances which the Commissioner
finds justify the availability of the rules set forth in
this Section 12.2, the allocation of Annual Additions
under the terms of the Plan for a particular Participant
would cause the limitations of Code section 415
applicable to that Participant for the Limitation Year
to be exceeded, the excess amounts shall not be deemed
to be Annual Additions in that Limitation Year if they
are treated as follows:
(i) The excess amounts in the Participant's Account
consisting of Participant Contributions and any
increment attributable thereto shall be paid to the
Participant as soon as administratively feasible.
(ii) The excess amounts in the Participant's Account
consisting of Company Matching Contributions shall
be used to reduce Company Matching Contributions
for the next Limitation Year (and succeeding
Limitation Years, as necessary) for that
Participant if that Participant is covered by the
Plan as of the end of the Limitation Year.
However, if that Participant is not covered by the
Plan as of the end of the Limitation Year then the
excess amounts must be held unallocated in a
suspense account for the Limitation Year and
allocated and reallocated in the next Limitation
Year to all of the remaining Participants in the
Plan. If a suspense account is in existence at any
time during a particular Limitation Year, other
than the first Limitation Year described in the
preceding sentence, all amounts in the suspense
account must be allocated and reallocated to
Participant's Accounts (subject to the limitations
of Code section 415) before any Company Matching
Contributions and Participant Contributions which
would constitute Annual Additions may be made to
the Plan for that Limitation Year and such excess
amounts must be used to reduce Company Matching
Contributions for the next Limitation Year (and
succeeding Limitation Plan Years, as necessary) for
all of the remaining Participants in the Plan. For
purposes of this subdivision, excess amounts may
not be distributed to Participants or former
Participants.
(iii) In the event of termination of the Plan the
suspense account described in (ii) above shall
revert to the Employer to the extent it may not
then be allocated to any Participant's Account.
(iv) Notwithstanding any other provision in this Section
12.2, the Employer shall not contribute any amount
that would cause an allocation to the suspense
account as of the date the contribution is
allocated. If the contribution is made prior to
the date as of which it is to be allocated, then
such contribution shall not exceed an amount that
would cause an allocation to the suspense account
if the date of contribution were an allocation
date.
(b) Overall Limit. For any Participant of this Plan who at
any time participated in a defined benefit plan
maintained by the Company, the rate of benefit accrual
by such Participant in each defined benefit plan in
which the Participant participates during the Limitation
Year will be reduced to the extent necessary to prevent
the sum of the following fractions, computed as of the
close of the Limitation Year, from exceeding 1.0:
(i) The Projected Annual Benefit of the Participant
under the defined benefit plan
over
The lesser of (1) the product of 1.25 multiplied by
the dollar limitation in effect under Code section
415(b)(1)(A) for such Limitation Year or (2) the
product of 1.4 multiplied by the amount which may
be taken into account under Code section
415(b)(1)(B) with respect to such Participant for
such Limitation Year,
plus
(ii) The sum of Annual Additions to such Participant's
Accounts under this Plan in such Limitation Year
and for all prior Limitation Years
over
The sum of the lesser of the following amounts
determined for such year and for each prior year of
service with the Company: (1) the product of 1.25
multiplied by the dollar limitation in effect under
Code section 415(c)(1)(A) for such Limitation Year
or (2) the product of 1.4 multiplied by 25% of the
Participant's Compensation for such Limitation
Year.
(c) Special Rules Applicable to Computation of Overall
Limit.
(i) For purposes of applying the defined contribution
plan fraction in Section 12.2(b), for any
Limitation Year beginning after December 31, 1975,
the following rules shall apply with respect to
Limitation Years before January 1, 1976:
(A) The aggregate amount taken into account in
determining the numerator of such fraction is
deemed not to exceed the aggregate amount
taken into account in determining the
denominator of the fraction.
(B) The amount taken into account for purposes of
subsection 12.1(a)(i)(C)(1) is an amount equal
to the excess of the aggregate amount of the
Participant's contributions for such years
during which he was an active participant in
the Plan over 10% of the Participant's
aggregate Compensation for all such years,
multiplied by a fraction, the numerator of
which is 1.0 and the denominator of which is
the number of years beginning before
January 1, 1976, during which the Participant
participated in the Plan. Participant
contributions made on or after October 2,
1973, shall be taken into account for purposes
of the preceding sentence only to the extent
that the amount of such contributions was
permissible under a plan as in effect on that
date.
(ii) In any case where the sum of the fractions in
Section 12.2(b) is greater than 1.0 calculated as
of the close of the last Limitation Year beginning
before January 1, 1983 for a Participant in
accordance with regulations prescribed by the
Commissioner pursuant to Section 235(g)(3) of the
Tax Equity and Fiscal Responsibility Act of 1982,
an amount shall be subtracted from the numerator of
the defined contribution plan fraction so that the
sum of such fractions does not exceed 1.0 for such
Limitation Year.
</TABLE>
EXHIBIT 10.2
<TABLE>
<S> <C>
KIMBERLY-CLARK CORPORATION HOURLY
EMPLOYEES INCENTIVE INVESTMENT PLAN
(As amended through May 24, 1994)
ARTICLE I
NAME, PURPOSE AND EFFECTIVE DATE OF PLAN
This Kimberly-Clark Corporation Hourly Employees Incentive
Investment Plan (the "Plan") has been adopted effective August 1,
1967. Its purpose is to promote the interests of the Corporation
and its stockholders by encouraging Eligible Employees to arrange
for personal investment programs which, depending upon the success
of the Corporation, will be augmented by Company Matching
Contributions. It provides each Eligible Employee with an
opportunity to become a stockholder of the Corporation. To comply
with the applicable requirements of the Tax Reform Act of 1986,
the Plan has been restated in its entirety effective March 31,
1993, except as otherwise provided in Section 11.12 hereof. [The
following sentence is effective September 1, 1994:] The Plan is
intended to be an employee stock ownership plan, as defined in
section 4975 of the Code, and is designed to invest primarily in
qualifying employer securities, as defined in section 409(l) of
the Code.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(zz) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(aaa) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(bbb) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ccc) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(ddd) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(eee) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(fff) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(ggg) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(hhh) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(iii) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(jjj) Trustee: The trustee under the Trust.
(kkk) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(lll) Valuation Date: The last day of each month.
(mmm) Withdrawal Year: As defined in Section 8.1.
(nnn) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in subsection 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(zz) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(aaa) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(bbb) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ccc) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(ddd) Stock and Cash Distribution: As defined in subsection
7.3(b).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE III
PARTICIPATION, CONTRIBUTIONS, AND ALLOCATIONS
3.1 Election to Participate. An Eligible Employee's election to
participate in the Plan shall, if given on Timely Notice,
(i) be effective as of the first Entry Date following his
election, and
(ii) remain in effect as a valid election to participate for
each successive Plan Year.
An election to participate by an Eligible Employee who,
immediately prior to becoming an Eligible Employee, was a
participant under the Kimberly-Clark Corporation Salaried
Employees Incentive Investment Plan shall be effective as
soon as administratively feasible upon exercising his
election.
3.2 Amount of Participant's Contributions.
(a) Basic After-Tax Contributions: During each Plan Year,
Basic After-Tax Contributions shall be made by a
Participant for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 2%, 3%,
4%, 5% or 6% of his Base Hourly Wages.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice a
Participant may change his election effective as of the
first day of any month.
[The following replaces section 3.2(a) effective January 1, 1995:]
(a) Basic After-Tax Contributions: During each Plan Year,
Basic After-Tax Contributions shall be made by a
Participant for deposit to his Account in an amount
(i) which is elected by him on Timely Notice, and
(ii) which, pursuant to his election, is either 1%, 2%,
3%, 4%, 5% or 6% of his Base Hourly Wages.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice, a
Participant may change his election effective as of the
first day of any month.
(b) Regular Unrestricted After-Tax Contributions.
(i) A Participant may elect on Timely Notice to make
Regular Unrestricted After-Tax Contributions to his
Account in any whole percentage equal to an amount
which is not less than 1% of his Base Hourly Wages
and not more than 6% of his Base Hourly Wages.
(ii) An election to make Regular Unrestricted After-Tax
Contributions by regular payroll deduction shall
remain in effect for so long as a Participant is
eligible to make Regular Unrestricted After-Tax
Contributions or, if earlier, until changed by a
Participant. A Participant may change such
election on Timely Notice effective as of the first
day of any month.
(iii) Regular Unrestricted After-Tax Contributions will
not be taken into account in determining the amount
of Company Matching Contributions made on behalf of
Participants.
(c) Special Unrestricted After-Tax Contributions. Once each
Plan Year a Participant may elect to make a Special
Unrestricted After-Tax Contribution in excess of the
amount elected under subsection 3.2(b)(i) in an amount
(i) which is elected by him on Timely Notice,
(ii) which, when added to the total of the Regular
Unrestricted After-Tax Contributions made by the
Participant to date in the Plan Year, would not
exceed 6% of his Base Hourly Wages for those
periods to date in such Plan Year during which
Basic After-Tax Contributions have been made;
(iii) which shall only be made in cash; and
(vi) which will not be taken into account in determining
the amount of Company Matching Contributions made
on behalf of the Participant.
3.3 General Limitation: Notwithstanding any other provision of
this Article III, no Contribution shall be made to the Plan
which would cause the Plan to fail to meet the requirements
for exemption from tax or to violate any provisions of the
Code.
3.4 Allocation of Contributions by Participants.
Basic After-Tax Contributions and Unrestricted After-Tax
Contributions. On Timely Notice, a Participant shall elect
to allocate in whole multiples of 1% all of the Basic After-
Tax Contributions and Unrestricted After-Tax Contributions to
be made during a Plan Year to one or more of
(i) the Government Fund,
(ii) the Diversified Fund,
(iii) the Fixed Income Fund, or
(iv) the K-C Stock Fund.
An election under this subsection shall remain in effect
until changed by a Participant. On Timely Notice a
Participant may change his elections effective as of the
first day of any month.
3.5 Suspension of All Contributions. On Timely Notice and
notwithstanding the provisions of Section 3.2, a Participant
may elect to suspend, effective reasonably soon after such
notice is given as established by Committee rule, all of his
Contributions. On Timely Notice, a Participant may elect to
resume such Contributions as of any Entry Date, provided,
however, that any such suspension must be for a period of not
less than three months.
A Participant's Contributions shall be automatically
suspended commencing with and continuing throughout any
period during which he fails to qualify as an Eligible
Employee. On Timely Notice upon requalifying as an Eligible
Employee a Participant may elect to make Contributions to his
Accounts as soon as administratively feasible.
3.6 Payment of Contributions to Trustee. The Employers shall
contribute or remit to the Trustee as soon as practicable
after the end of each month the amounts withheld from the
Participants' compensation during the month as Contributions
under the Plan.
3.7 Reallocation of Participant's Accounts. A Participant who
has remained a Participant for at least three months may on
Timely Notice elect to reallocate, effective as of the first
Valuation Date following his election, all or any whole
percentage portion of any of his Employee Accounts or
Employer Accounts or both, provided he has not elected a
reallocation within the preceding three months; provided,
however, that a three month period that begins at the end of
a Plan Year shall not be more than ninety (90) days.
3.8 Redeposits and Restored Amounts.
(a) Notwithstanding any provision in this Plan to the
contrary, on Timely Notice, an Employee who has
forfeited all or a portion of his Employer Accounts may,
within 5 years of the date of the distribution or
withdrawal which caused such forfeiture, redeposit such
distribution or withdrawal, and upon such redeposit, the
amount of the forfeiture associated with the redeposit
shall be restored to the Employee's Employer Stock
Account (and to the Withdrawal Year) from which it was
forfeited. Redeposits shall be allocated to the Plan
funds in the same manner as Basic After-Tax
Contributions made on behalf of the Participant.
Redeposits shall be made on a Withdrawal Year by
Withdrawal Year basis, beginning with the most remotely
ended Withdrawal Year, and the amount redeposited for
any Withdrawal Year shall be equal to the amount
distributed or withdrawn which caused the forfeiture for
that Withdrawal Year.
For an Employee hired after March 31, 1989, the amount
redeposited shall be equal to the total amount
distributed or withdrawn which caused the forfeiture.
(b) No redeposit of a withdrawal or distribution shall be
permitted if, coincident with or subsequent to the
forfeiture associated with that withdrawal or
distribution, an Employee incurs 5 consecutive One-Year
Periods of Severance. For Plan Years prior to April 1,
1989, and for purposes of this Section 3.8 only, an
Employee incurs a One-Year Period of Severance if he is
not an Employee on the last day of a Plan Year.
(c) Where applicable, if an Employee receives such a
distribution or makes a withdrawal that results in a
forfeiture, and if such Employee does not make a
redeposit of such amount within the same Plan Year, any
Plan Year between the Plan Year of distribution or
withdrawal and the Plan Year of redeposit (including the
Plan Year of distribution or withdrawal but not
including the Plan Year of redeposit) shall not be
counted in determining when the restored amounts are
attributable to a Withdrawal Year or Matured Withdrawal
Years.
(d) Notwithstanding the preceding provision, a Participant
who is entitled to no portion of his Employer Account
upon termination of employment shall be deemed to have
received a distribution of zero dollars ($0) from such
account at the earliest possible date provided under
Section 7.2.
(e) Any forfeiture from the Basic After-Tax Contribution
section of his Employer Accounts under subsection 7.1(f)
and the applicable years of Service shall be restored in
accordance with the provisions of this Section 3.8 if
the Terminated Participant returns to his employment
with an Employer prior to incurring 5 consecutive One-
Year Periods of Severance.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.3, Company
Matching Contributions for each Plan Year shall be 50% of
Basic After-Tax Contributions for that Plan Year allocated to
the K-C Stock Fund and 20% of Basic After-Tax Contributions
for that Plan Year allocated to the Government Fund, the
Diversified Fund or the Fixed Income Fund.
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are deducted or withheld for payment
to the Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.3 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if, in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.4 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.4(a)(i) shall be determined in the
manner set forth in subsection 4.4(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.4(a)(i)
above.
ARTICLE V
TRUSTEE AND TRUST AGREEMENT
5.1 The Corporation shall enter into a trust agreement with a
person or corporation selected by the Board to act as Trustee
of Contributions and Company Matching Contributions. The
Trustee shall receive all Contributions and all Company
Matching Contributions and shall hold, manage, administer,
and invest the same, reinvest any income, and, in accordance
with instructions and directions of the Committee subject to
the Plan, make distributions.
The trust agreement shall be in such form and contain such
provisions as the Board may deem necessary and appropriate to
effectuate the purposes of the Plan and to qualify the Plan
and the Trust under the Code. Upon the written request of an
Eligible Employee, a copy of the trust agreement shall be
made available for his inspection.
The Board may, from time to time, remove the Trustee or any
successor Trustee at any time and any such Trustee or any
successor Trustee may resign. The Board shall, upon removal
or resignation of a Trustee, appoint a successor Trustee.
The Trustee's accounts, books, and records relating to the
Trust may be audited annually by auditors selected by the
Board.
The Trustee's fee shall be paid by the Corporation but until
so paid shall constitute a charge upon the Trust. Brokerage
fees, asset management fees, investment management fees and
other direct costs of investment and taxes (including
interest and penalties) shall be paid by the Trustee out of
the funds of the Trust to which such costs are attributable,
unless paid by the Corporation in its discretion.
ARTICLE VI
INVESTMENT: PARTICIPANT'S ACCOUNTS: VOTING OF STOCK
6.1 Investment of Contributions.
(a) A Participant's Contributions during each Plan Year
shall be invested in the various funds in accordance
with the Participant's allocations under Section 3.4. A
Participant's interest arising from his reallocation for
prior Plan Years shall be invested in the various funds
in accordance with the Participant's directions under
Section 3.7. Company Matching Contributions during each
Plan Year shall be invested in the K-C Stock Fund. All
such investments and gains or losses related thereto
shall be allocated to each Participant's Accounts
pursuant to the provisions of Section 6.2.
(b) The Committee shall designate Participant's
Contributions and Company Matching Contributions for
payment to the Trustee for investment, and Employee
Accounts and Employer Accounts for reallocation in
accordance with subsection 6.1(a), and shall advise the
Trustee of such designation.
6.2 Participant's Accounts:
(a) Establishment of Accounts. Each Participant shall have
established and maintained for him separate Accounts
which, depending upon the allocation and reallocation
options he has selected, shall consist of Employee
Accounts and Employer Accounts in one or more of the
Government Fund, the Diversified Fund, the Fixed Income
Fund, and the K-C Stock Fund. Each such Employee
Account shall be subdivided into a Basic After-Tax
Contribution Section and an Unrestricted After-Tax
Contribution Section. Each such Employer Account shall
be subdivided into subsections corresponding to the
Sections of the Employee Accounts, other than the
Unrestricted After-Tax Contribution Section.
As soon as practicable following the end of each Plan
Year, the Committee will cause an annual statement to be
prepared for each Participant which will reflect the
status of the Participant's Accounts in such form as
shall be prescribed by the Committee.
(b) Separation of Accounts. Each Participant's Accounts
shall be further separated and maintained as Withdrawal
Years and Matured Withdrawal Years as set forth in
Sections 8.1 and 8.2.
(c) Crediting of Accounts. As of the close of business on
each Valuation Date the designated Accounts of each
Participant shall be appropriately credited with the
amounts of his Contributions, or the reallocation of his
other Accounts, if any, and his Employer Stock Account
shall be credited with the amount of any Company
Matching Contributions with respect to him. All such
Participant's Contributions, reallocations and Company
Matching Contributions with respect to any month shall
be considered as having been made on the Valuation Date
but subsequent to the valuation for such month provided
for in subsection 6.2(d).
(d) Valuation of Accounts. Each Participant's Accounts
shall be valued and adjusted monthly to preserve for
each Participant his proportionate interest in the
related funds. As of each Valuation Date each of the
Accounts of each Participant shall be adjusted to
reflect the effect of income, collected and accrued,
realized and unrealized profits and losses, expenses and
all other transactions with respect to the related fund
as follows:
(i) The Current Market Value of the assets held in each
of the funds shall be determined by the Trustee,
and
(ii) The separate balances provided for in subsection
6.2(b) of each Participant's Account under each of
the related funds shall be adjusted by multiplying
by the ratio that the Current Market Value of such
fund as determined under subsection 6.2(d)(i) bears
to the aggregate of the Account balances under such
fund.
6.3 Stock Rights, Stock Splits and Stock Dividends. A
Participant shall have no right of request, direction or
demand upon the Committee or the Trustee to exercise in his
behalf rights to purchase shares of Corporation Stock or
other securities of the Corporation. The Trustee, at the
direction of the Committee, shall exercise or sell any rights
to purchase shares of Corporation Stock appertaining to
shares of such stock held by the Trustee and shall sell at
the direction of the Committee any rights to purchase other
securities of the Corporation appertaining to shares of
Corporation Stock held by the Trustee. The Accounts of
Participants shall be appropriately credited. Shares of
Corporation Stock received by the Trustee by reason of a
stock split or a stock dividend shall be appropriately
allocated to the Accounts of the Participants.
6.4 Voting of Corporation Stock. A Participant (or in the case
of his death, his Beneficiary) may direct the voting at each
annual meeting and at each special meeting of the
stockholders of the Corporation of that number of whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding the record date for such meeting. Each such
Participant (or Beneficiary) will be provided with copies of
pertinent proxy solicitation material together with a request
for the Participant's confidential instructions as to how
such shares are to be voted. The Committee shall direct the
Trustee to vote such shares in accordance with such
instructions and shall also direct the Trustee how to vote
any shares of Corporation Stock at any meeting for which it
has not received, or is not subject to receiving, such voting
instructions.
6.5 Tender Offers. A Participant (or in the event of his death,
his Beneficiary) may direct the Trustee in writing how to
respond to a tender or exchange offer for any or all whole
shares of Corporation Stock held by the Trustee and
attributable to the balances in his Employer Stock Account
and his Employee Stock Account as of the Valuation Date
preceding such offer. The Committee shall notify each
Participant (or Beneficiary) and exert its best efforts to
timely distribute or cause to be distributed to him such
information as will be distributed to stockholders of the
Corporation in connection with any such tender or exchange
offer. Upon receipt of such instructions, the Trustee shall
tender such shares of Corporation Stock as and to the extent
so instructed. If the Trustee shall not receive instructions
from a Participant (or Beneficiary) regarding any such tender
or exchange offer for such shares of Corporation Stock (or
shall receive instructions not to tender or exchange such
shares), the Trustee shall have no discretion in such matter
and shall take no action with respect thereto. With respect
to shares of Corporation Stock in the K-C Stock Fund for
which the Trustee is not subject to receiving such
instruction, however, the Trustee shall tender such shares in
the same ratio as the number of shares for which it receives
instructions to tender bears to the total number of shares
for which it is subject to receiving instructions, and shall
have no discretion in such matter and shall take no action
with respect thereto other than as specifically provided in
this sentence.
ARTICLE VII
DISTRIBUTION OF ACCOUNTS
7.1 Accounts to be Distributed.
(a) Termination On or After Attainment of Age 55 or Upon
Disability. If a Participant's employment with an
Employer is terminated on or after his attainment of age
55, or if his employment is terminated upon his Total
and Permanent Disability, he shall be fully vested in
his Accounts and shall be entitled to receive a
distribution of the entire amount then in his Accounts
in accordance with Section 7.4.
(b) Termination Upon Death. In the event that the
termination of employment of a Participant is caused by
his death, or a Terminated Participant dies prior to the
first day on which such Terminated Participant's
Accounts are payable, the entire amount then in his
Accounts shall be paid to his Beneficiary in accordance
with Section 7.4 after receipt by the Committee of
acceptable proof of death.
(c) Termination As a Result of Group Termination. In the
event that the termination of employment of a
Participant is caused by reason of his status as a
member of a group involved in a Group Termination, he
shall be entitled to receive a distribution of the
entire amount then in his Accounts in accordance with
Section 7.4, unless action is taken pursuant to the Plan
to segregate the Accounts of all the Participants in
such group from the Trust and arrange for a transfer to
or a merger with a qualified successor plan or trust
with respect thereto.
(d) Termination for Other Reasons. Effective April 1, 1989,
if a Participant's employment with an Employer is
terminated for any other reason, the Participant shall
be entitled to the entire amount in his Employee
Accounts and a portion of his Employer Accounts as
determined in accordance with the following schedule:
Vested Forfeited
Years of Service Percentage Percentage
Less than 5 0% 100%
5 or more 100% 0%
provided, however, that for an Employee hired prior to
April 1, 1989, the above provision shall apply only to
the extent that the vested amount of the Participant's
Employer Accounts computed in accordance with the above
provision is not less than the Vested Section of the
Participant's Employer Accounts computed under the
provisions of the Plan in effect as of March 31, 1989.
In the event that the termination of employment of a
Participant is caused by any reason other than the
Employee quits, is discharged, retires or dies, the
Participant will be deemed to have a 12 month period of
absence following the date of such termination of
employment, for purposes of determining the portion of
his Employer Accounts which such Participant shall be
entitled to receive in a distribution in accordance with
this subsection.
In the event that the Plan is amended to change the
vesting provisions set forth in this subsection 7.1(d)
above, a Participant with 3 or more years of Service may
elect to have the vested percentage of the Participant's
Employer Accounts determined pursuant to the vesting
provisions in effect prior to the amendment.
(e) Distribution Transfer in Certain Group Terminations. In
the event that a Participant is a member of a group
involved in a Group Termination and the circumstances
are such that in the opinion of the Committee all of the
involved Participant's Accounts should be segregated
from the Plan and Trust, and transferred to or merged
with a successor qualified plan and trust, the Committee
shall take such action as it may deem necessary to cause
such segregation and transfer or merger to occur. For
these purposes, the amounts to be transferred or merged
shall be determined as though all of the Participants
involved in such group had terminated their employment
by reason of attainment of age 55. In such event, those
individuals in such group shall not be entitled to
receive any distribution hereunder and all liabilities
of this Plan and of the Trust with respect to such
individuals shall be deemed fully discharged on the date
of such transfer or merger.
(f) Deferred Distributions. Notwithstanding anything in
this Article VII to the contrary, if the aggregate value
of the Accounts of any Participant exceeds $3500, an
immediate distribution shall not be made without the
consent of the Participant. A Participant who fails to
consent to a distribution under this subsection 7.1(f)
shall continue to participate as a Terminated
Participant and shall be entitled to a distribution of
his Employee Accounts and the vested percentage of his
Employer Accounts. Upon Timely Notice of request for
payment, the Terminated Participant's Employee Accounts
and the vested percentage of his Employer Accounts shall
be distributed in accordance with the provisions of
Section 7.4.
7.2 Settlement Date and Time of Distributions. Each
Participant's Settlement Date shall be the Valuation Date
coincident with or following the termination of his
employment or the Valuation Date following Timely Notice of
his request for payment, whichever is later. Notwithstanding
the foregoing, the Settlement Date for a Terminated
Participant shall be the earlier of the Valuation Date
following Timely Notice of his request for payment or the
Valuation Date following Timely Notice of the request for
payment due to his death. Any forfeiture with respect to the
Accounts of the Participant or Terminated Participant shall
be determined as of the Valuation Date coincident with or
following such Participant's or Terminated Participant's
termination of employment. Distribution of a Participant's
Accounts shall be made to him or to his Beneficiary in full
after the termination of his employment and within 60 days
following his Settlement Date, except in the case of an
Optional Annuity Distribution or an Optional Installment
Distribution.
[The following replaces section 7.2 effective January 1, 1995:]
7.2 Settlement Date and Time of Distributions. Each
Participant's Settlement Date shall be the Valuation Date
coincident with or following the termination of his
employment or the Valuation Date following Timely Notice of
his request for payment, whichever is later. Notwithstanding
the foregoing, the Settlement Date for a Terminated
Participant shall be the earlier of the Valuation Date
following Timely Notice of his request for payment or the
Valuation Date following Timely Notice of the request for
payment due to his death. Any forfeiture with respect to the
Accounts of the Participant or Terminated Participant shall
be determined as of the Valuation Date coincident with or
following such Participant's or Terminated Participant's
termination of employment. Distribution of a Participant's
Accounts shall be made to him or to his Beneficiary in full
after the termination of his employment and within 60 days
following his Settlement Date.
7.3 Certain Definitions Relating to Distributions and
Withdrawals.
(a) Lump Sum Distribution. A "Lump Sum Distribution" of a
Participant's Accounts means one distribution consisting
of
(i) the cash equivalent of the Current Market Value on
the Settlement Date of the Participant's Employee
Accounts, except his Employee Stock Account, and
the vested percentage of his Employer Accounts,
except his Employer Stock Account, and
(ii) full shares of Corporation Stock on the Settlement
Date, attributable to the Participant's Employee
Stock Account and to the vested percentage of his
Employer Stock Account, together with the cash
equivalent of the Current Market Value on the
Settlement Date of fractional shares of such stock
attributable to such Accounts, and
(iii) the cash equivalent of any other interest
attributable to the Participant's Accounts, except
the forfeited percentage of his Employer Accounts,
on the Settlement Date.
(b) Lump Sum Optional Distribution. A "Lump Sum Optional
Distribution" of a Participant's Accounts means the same
as a Lump Sum Distribution, as defined in subsection
7.3(a), except that clause (ii) in said subsection shall
be replaced by the following clause:
(ii) the cash equivalent of the Current Market Value as
of the Settlement Date of all the shares and
fractional shares of Corporation Stock attributable
to the Participant's Employee Stock Account and to
the vested percentage of his Employer Stock
Account.
(c) Optional Annuity Distribution. An "Optional Annuity
Distribution" of a Participant's Accounts means the
distribution, of a single premium, non-transferable
joint and survivor annuity policy, or any other form of
single premium, non-transferable annuity policy approved
under rules established by the Committee. If a joint
and survivor annuity is selected, the form of such
annuity shall be such that an amount is payable to the
Participant for his life, and upon his death, fifty
percent (50%) of such amount is payable to his surviving
spouse for the remainder of the spouse's life. If the
Participant shall receive a joint and survivor annuity,
the payments may not be based upon a contingency
extending beyond the life expectancy of the Participant
and the Participant's spouse; and if a single life
annuity is elected, the payments may not be based upon a
contingency extending beyond the life expectancy of the
Participant. If an annuity form of distribution is
elected, an annuity policy (containing further
provisions relating to payment and options which may be
elected by the Participant under rules established by
the Committee) shall be purchased by the Trustee (from a
life insurance company selected by the Committee) from
the cash equivalent of the Participant's Accounts, as of
the Settlement Date, valued as though such Accounts were
to be distributed as a Lump Sum Optional Distribution,
as defined in subsection 7.3(b). If the Committee or
the Trustee is unable to obtain the information required
by the life insurance company for the purchase of an
annuity policy, as described above, the Optional Annuity
Distribution shall be made directly from the
Participant's Accounts in such form as may be set forth
under rules established by the Committee. If the
Optional Annuity Distribution is being paid directly
from the Participant's Accounts as provided above, the
Participant, or in the case of a married Participant the
Participant with spousal consent may elect distribution
of his accounts in the form of either a Lump Sum
Distribution or a Lump Sum Optional Distribution in the
same manner as a Terminated Participant.
In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution of the
Participant's Accounts shall be in the form of a joint
and survivor annuity, as described above, under which
the survivor annuity is payable to such Participant's
spouse; unless, within the period 90 days prior to the
Settlement Date, (i) such spouse consents in writing to
the election of another form of annuity or the naming of
another person to receive the survivor annuity, and
acknowledges the effect of such election, and (ii) such
consent is witnessed by a notary public. No such
spousal consent need be furnished with respect to an
election, however, if the Committee determines that such
Participant's spouse cannot be located, or that such
consent is unobtainable for any other reason provided
under applicable regulations. For purposes of this
subsection 7.3(c), the term spouse shall mean the spouse
of a Participant as of his Settlement Date.
(d) Optional Installment Distribution. An "Optional
Installment Distribution" of a Participant's Accounts
means that a Participant has elected prior to his
Settlement Date to have the cash equivalent of all of
his Accounts, as at the Settlement Date, valued as
though such Accounts were to be distributed as a Lump
Sum Optional Distribution as defined in subsection
7.3(b), applied to the purchase of a contract which
provides:
(i) for the payment of the cash equivalent of the
Participant's Accounts, plus interest, in equal
monthly installments, commencing with the end of
either the second or twelfth month following his
Settlement Date and continuing for either 60 or 120
months, as the Participant shall elect on Timely
Notice prior to his Settlement Date;
(ii) that if the Participant dies prior to receiving all
of the payments to which he is entitled under the
contract, an amount equal to the sum of all such
remaining payments shall be distributed to his
Beneficiary in one cash payment as soon as
practicable.
[The following replaces section 7.3 effective September 1, 1994:]
7.3 Certain Definitions Relating to Distributions and
Withdrawals.
(a) All Stock Distribution. An "All Stock Distribution" of
a Participant's Accounts means one distribution
consisting of full shares of Corporation Stock on the
Settlement Date, attributable to the Participant's
Employee Accounts and to the vested percentage of his
Employer Accounts, together with the cash equivalent of
the Current Market Value on the Settlement Date of
fractional shares of such stock attributable to such
Accounts.
(b) Stock and Cash Distribution. A "Stock and Cash
Distribution" of a Participant's Accounts means one
distribution consisting of
(i) the cash equivalent of the Current Market Value on
the Settlement Date of the Participant's Employee
Accounts, except his Employee Stock Account, and
the vested percentage of his Employer Accounts,
except his Employer Stock Account, and
(ii) full shares of Corporation Stock on the Settlement
Date, attributable to the Participant's Employee
Stock Account and to the vested percentage of his
Employer Stock Account, together with the cash
equivalent of the Current Market Value on the
Settlement Date of fractional shares of such stock
attributable to such Accounts, and
(iii) the cash equivalent of any other interest
attributable to the Participant's Accounts, except
the forfeited percentage of his Employer Accounts,
on the Settlement Date.
(c) All Cash Distribution. An "All Cash Distribution" of a
Participant's Accounts means the same as a Stock and
Cash Distribution, as defined in subsection 7.3(b),
except that clause (ii) in said subsection shall be
replaced by the following clause:
(ii) the cash equivalent of the Current Market Value as
of the Settlement Date of all the shares and
fractional shares of Corporation Stock attributable
to the Participant's Employee Stock Account and to
the vested percentage of his Employer Stock
Account.
(d) Optional Annuity Distribution. An "Optional Annuity
Distribution" of a Participant's Accounts means the
distribution of a single premium, non-transferable
joint and survivor annuity policy, or any other form of
single premium, non-transferable annuity policy approved
under rules established by the Committee. If a joint
and survivor annuity is selected, the form of such
annuity shall be such that an amount is payable to the
Participant for his life, and upon his death, fifty
percent (50%) of such amount is payable to his surviving
spouse for the remainder of the spouse's life. If the
Participant shall receive a joint and survivor annuity,
the payments may not be based upon a contingency
extending beyond the life expectancy of the Participant
and the Participant's spouse; and if a single life
annuity is elected, the payments may not be based upon a
contingency extending beyond the life expectancy of the
Participant. If an annuity form of distribution is
elected, an annuity policy (containing further
provisions relating to payment and options which may be
elected by the Participant under rules established by
the Committee) shall be purchased by the Trustee (from a
life insurance company selected by the Committee) from
the cash equivalent of the Participant's Accounts, as of
the Settlement Date, valued as though such Accounts were
to be distributed as an All Cash Distribution, as
defined in subsection 7.3(c). If the Committee or the
Trustee is unable to obtain the information required by
the life insurance company for the purchase of an
annuity policy, as described above, the Optional Annuity
Distribution shall be made directly from the
Participant's Accounts in such form as may be set forth
under rules established by the Committee. If the
Optional Annuity Distribution is being paid directly
from the Participant's Accounts as provided above, the
Participant, or in the case of a married Participant the
Participant with spousal consent, may elect distribution
of his accounts in the form of an All Stock
Distribution, a Stock and Cash Distribution or an All
Cash Distribution in the same manner as a Terminated
Participant.
In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution of the
Participant's Accounts shall be in the form of a joint
and survivor annuity, as described above, under which
the survivor annuity is payable to such Participant's
spouse; unless, within the period 90 days prior to the
Settlement Date, (i) such spouse consents in writing to
the election of another form of annuity or the naming of
another person to receive the survivor annuity, and
acknowledges the effect of such election, and (ii) such
consent is witnessed by a notary public. No such
spousal consent need be furnished with respect to an
election, however, if the Committee determines that such
Participant's spouse cannot be located, or that such
consent is unobtainable for any other reason provided
under applicable regulations. For purposes of this
subsection 7.3(d), the term spouse shall mean the spouse
of a Participant as of his Settlement Date.
(e) Optional Installment Distribution. An "Optional
Installment Distribution" of a Participant's Accounts
means that a Participant has elected prior to his
Settlement Date to have the cash equivalent of all of
his Accounts, as at the Settlement Date, valued as
though such Accounts were to be distributed as an All
Cash Distribution as defined in subsection 7.3(c),
applied to the purchase of a contract which provides:
(i) for the payment of the cash equivalent of the
Participant's Accounts, plus interest, in equal
monthly installments, commencing with the end of
either the second or twelfth month following his
Settlement Date and continuing for either 60 or 120
months, as the Participant shall elect on Timely
Notice prior to his Settlement Date;
(ii) that if the Participant dies prior to receiving all
of the payments to which he is entitled under the
contract, an amount equal to the sum of all such
remaining payments shall be distributed to his
Beneficiary in one cash payment as soon as
practicable.
[The following replaces section 7.3 effective January 1, 1995:]
7.3 Certain Definitions Relating to Distributions and
Withdrawals.
(a) All Stock Distribution. An "All Stock Distribution" of
a Participant's Accounts means one distribution
consisting of full shares of Corporation Stock on the
Settlement Date, attributable to the Participant's
Employee Accounts and to the vested percentage of his
Employer Accounts, together with the cash equivalent of
the Current Market Value on the Settlement Date of
fractional shares of such stock attributable to such
Accounts.
(b) Stock and Cash Distribution. A "Stock and Cash
Distribution" of a Participant's Accounts means one
distribution consisting of
(i) the cash equivalent of the Current Market Value on
the Settlement Date of the Participant's Employee
Accounts, except his Employee Stock Account, and
the vested percentage of his Employer Accounts,
except his Employer Stock Account, and
(ii) full shares of Corporation Stock on the Settlement
Date, attributable to the Participant's Employee
Stock Account and to the vested percentage of his
Employer Stock Account, together with the cash
equivalent of the Current Market Value on the
Settlement Date of fractional shares of such stock
attributable to such Accounts, and
(iii) the cash equivalent of any other interest
attributable to the Participant's Accounts, except
the forfeited percentage of his Employer Accounts,
on the Settlement Date.
(c) All Cash Distribution. An "All Cash Distribution" of a
Participant's Accounts means the same as a Stock and
Cash Distribution, as defined in subsection 7.3(b),
except that clause (ii) in said subsection shall be
replaced by the following clause:
(ii) the cash equivalent of the Current Market Value as
of the Settlement Date of all the shares and
fractional shares of Corporation Stock attributable
to the Participant's Employee Stock Account and to
the vested percentage of his Employer Stock
Account.
7.4 Methods of Distribution.
(a) Distribution by Reason of Death. The Beneficiary of a
Participant to which subsection 7.1(b) applies shall be
entitled to receive a distribution of such Participant's
Accounts in the form of either a Lump Sum Distribution,
a Lump Sum Optional Distribution, an Optional Annuity
Distribution, or an Optional Installment Distribution as
elected by the Participant in the appointment of his
Beneficiary. If no such election was made, such
distribution shall be in the form of either a Lump Sum
Distribution, a Lump Sum Optional Distribution, an
Optional Annuity Distribution, or an Optional
Installment Distribution as elected by the Beneficiary.
(b) Distribution Upon Termination of Employment for Reasons
Other than Death.
(i) A Participant who is entitled to receive a
distribution of his Accounts due to the termination
of his employment for any reason specified in
Section 7.1, except death, may on Timely Notice
elect to receive such distribution in the form of
either a Lump Sum Distribution, a Lump Sum Optional
Distribution, an Optional Annuity Distribution, or
an Optional Installment Distribution at any time.
In the event no such election is made, and the
Participant is married at the date of his
distribution, such distribution will be made in the
form of a joint and survivor annuity as described
in subsection 7.3(c).
(ii) In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution
shall be in the form of a joint and survivor
annuity as described in subsection 7.3(c), provided
the Participant's spouse consents thereto in
accordance with subsection 7.3(c). The Committee
shall, within a reasonable time prior to
commencement of benefits (but, in all events, no
less than 30 nor more than 90 days prior thereto)
furnish to such Participant a written explanation
of the terms and conditions of the joint and
survivor annuity and the financial effect upon a
Participant's benefit (in terms of dollars per
annuity payment) of making an election not to take
the joint and survivor annuity. An election by a
Participant entitled to such explanation under this
subsection not to take the joint and survivor
annuity described in this Article, or a change in
or revocation of any such election, may be made at
any time during the 90-day period prior to the date
benefits commence, as described in subsection
7.3(c).
(c) Small Distributions. Notwithstanding any provision of
this Section 7.4 to the contrary, if the aggregate value
of a Participant's Accounts does not exceed $3500, the
Committee shall direct the distribution of the Accounts
of any Participant as a Lump Sum Distribution or a Lump
Sum Optional Distribution, as elected by the Participant
or his Beneficiary prior to the Settlement Date. If no
earlier election is made, Timely Notice of a request for
payment shall be deemed to have been given two months
after termination of employment and such distribution
shall be in the form of a Lump Sum Optional
Distribution.
[The following replaces section 7.4 effective September 1, 1994:]
7.4 Methods of Distribution.
(a) Distribution by Reason of Death. The Beneficiary of a
Participant to which subsection 7.1(b) applies shall be
entitled to receive a distribution of such Participant's
Accounts in the form of either an All Stock
Distribution, a Stock and Cash Distribution, an All Cash
Distribution, an Optional Annuity Distribution, or an
Optional Installment Distribution as elected by the
Participant in the appointment of his Beneficiary. If
no such election was made, such distribution shall be in
the form of either an All Stock Distribution, a Stock
and Cash Distribution, an All Cash Distribution, an
Optional Annuity Distribution, or an Optional
Installment Distribution as elected by the Beneficiary.
(b) Distribution Upon Termination of Employment for Reasons
Other than Death.
(i) A Participant who is entitled to receive a
distribution of his Accounts due to the termination
of his employment for any reason specified in
Section 7.1, except death, may on Timely Notice
elect to receive such distribution in the form of
an All Stock Distribution, a Stock and Cash
Distribution, an All Cash Distribution, an Optional
Annuity Distribution, or an Optional Installment
Distribution at any time. In the event no such
election is made, and the Participant is married at
the date of his distribution, such distribution
will be made in the form of a joint and survivor
annuity as described in subsection 7.3(d).
(ii) In the case of a married Participant who elects an
Optional Annuity Distribution, the distribution
shall be in the form of a joint and survivor
annuity as described in subsection 7.3(d), provided
the Participant's spouse consents thereto in
accordance with subsection 7.3(d). The Committee
shall, within a reasonable time prior to
commencement of benefits (but, in all events, no
less than 30 nor more than 90 days prior thereto)
furnish to such Participant a written explanation
of the terms and conditions of the joint and
survivor annuity and the financial effect upon a
Participant's benefit (in terms of dollars per
annuity payment) of making an election not to take
the joint and survivor annuity. An election by a
Participant entitled to such explanation under this
subsection not to take the joint and survivor
annuity described in this Article, or a change in
or revocation of any such election, may be made at
any time during the 90-day period prior to the date
benefits commence, as described in subsection
7.3(d).
(c) Small Distributions. Notwithstanding any provision of
this Section 7.4 to the contrary, if the aggregate value
of a Participant's Accounts does not exceed $3500, the
Committee shall direct the distribution of the Accounts
of any Participant as an All Stock Distribution, a Stock
and Cash Distribution or an All Cash Distribution, as
elected by the Participant or his Beneficiary prior to
the Settlement Date. If no earlier election is made,
Timely Notice of a request for payment shall be deemed
to have been given two months after termination of
employment and such distribution shall be in the form of
an All Cash Distribution.
[The following replaces section 7.4 effective January 1, 1995:]
7.4 Methods of Distribution.
(a) Distribution by Reason of Death. The Beneficiary of a
Participant to which subsection 7.1(b) applies shall be
entitled to receive a distribution of such Participant's
Accounts in the form of either an All Stock
Distribution, a Stock and Cash Distribution or an All
Cash Distribution as elected by the Participant in the
appointment of his Beneficiary. If no such election was
made, such distribution shall be in the form of either
an All Stock Distribution, a Stock and Cash Distribution
or an All Cash Distribution as elected by the
Beneficiary.
(b) Distribution Upon Termination of Employment for Reasons
Other than Death. A Participant who is entitled to
receive a distribution of his Accounts due to the
termination of his employment for any reason specified
in Section 7.1, except death, may on Timely Notice elect
to receive such distribution in the form of an All Stock
Distribution, a Stock and Cash Distribution or an All
Cash Distribution at any time.
(c) Small Distributions. Notwithstanding any provision of
this Section 7.4 to the contrary, if the aggregate value
of a Participant's Accounts does not exceed $3500, the
Committee shall direct the distribution of the Accounts
of any Participant as an All Stock Distribution, a Stock
and Cash Distribution or an All Cash Distribution as
elected by the Participant or his Beneficiary prior to
the Settlement Date. If no earlier election is made,
Timely Notice of a request for payment shall be deemed
to have been given two months after termination of
employment, and such distribution shall be in the form
of an All Cash Distribution.
7.5 Miscellaneous.
(a) For the purpose of the Plan, no termination of
employment will be deemed to have occurred in any
instance where the person involved remains in Service or
is reemployed by an Employer prior to his Settlement
Date.
(b) In the event of the death, prior to his receipt of a
distribution, of a Participant who at the time of his
death was entitled to receive distribution under
subsection 7.4(b) and elected to receive such
distribution in the form of a Lump Sum Distribution or a
Lump Sum Optional Distribution, or was entitled to
receive a distribution under subsection 7.4(c), and if
the Committee has notice of the Participant's death
prior to such distribution, then such distribution shall
be made to the Participant's Beneficiary by the same
method as it would have been made to the Participant but
for his death.
[The following replaces section 7.5 effective September 1, 1994:]
7.5 Miscellaneous.
(a) For the purpose of the Plan, no termination of
employment will be deemed to have occurred in any
instance where the person involved remains in Service or
is reemployed by an Employer prior to his Settlement
Date.
(b) In the event of the death, prior to his receipt of a
distribution, of a Participant who at the time of his
death was entitled to receive distribution under
subsection 7.4(b) and elected to receive such
distribution in the form of an All Stock Distribution, a
Stock and Cash Distribution, or an All Cash
Distribution, or was entitled to receive a distribution
under subsection 7.4(c), and if the Committee has notice
of the Participant's death prior to such distribution,
then such distribution shall be made to the
Participant's Beneficiary by the same method as it would
have been made to the Participant but for his death.
7.6 Required Distributions.
(a) Notwithstanding any provision of the Plan to the
contrary, a Participant's or Terminated Participant's
Accounts shall be distributed commencing no later than
the earlier of:
(i) April 1 of the calendar year following the year in
which the Participant or Terminated Participant
attains age 70-1/2, except to the extent that
Section 1121(d)(4) of the Tax Reform Act of 1986
provides otherwise, or
(ii) unless the Participant elects a later date (which
can be no later than the date specified in (i)
above), the 60th day after the latest of:
(A) the close of the Plan Year in which the
Participant attains age 65,
(B) the close of the Plan Year which includes the
date 10 years after the date the Participant
first commenced participating in the Plan, or
(C) the close of the Plan Year in which the
Participant terminated employment with his
Employer.
(b) All distributions from the Plan shall be made in
accordance with the requirements of Code section
401(a)(9) and the regulations thereunder, including the
minimum distribution incidental benefit requirements.
7.7 Unclaimed Benefits. During the time when a benefit hereunder
is payable to any Terminated Participant or, if deceased, his
Beneficiary, the Committee shall mail by registered or
certified mail to such Participant or Beneficiary, at his
last known address, a written demand for his then address, or
for satisfactory evidence of his continued life, or both. If
such information is not furnished to the Committee within 12
months from the mailing of such demand, then the Committee
may, under rules established by the Committee, in its sole
discretion, declare such benefit, or any unpaid portion
thereof, suspended, with the result that such unclaimed
benefit shall be treated as a forfeiture for the Plan Year
within which such 12-month period ends, but shall be subject
to restoration through an Employer Contribution if the lost
Participant or such Beneficiary later files a claim for such
benefit.
7.8 Reserved.
7.9 Karolton Envelope Benefit. Notwithstanding any other
provision of the Plan, if a Participant's employment with an
Employer is terminated, he shall be fully vested in his
Accounts and shall be entitled to receive a distribution of
the entire amount then in his Accounts in accordance with
Section 7.4. if such Participant meets all of the following
conditions:
(a) immediately prior to his termination of employment he
must have been an Employee of Karolton Envelope; and
(b) such termination of employment must be involuntary on
the part of the Participant, be caused solely by the
elimination of his job function with the Corporation due
to the sale of assets of Karolton Envelope under the
Assets Purchase Agreement entered into between the
Corporation and KECA Corporation dated October 29, 1993,
and such termination of employment must occur on the
Closing Date of such Assets Purchase Agreement.
7.10 Spenco Medical Corporation Benefit. Notwithstanding any
other provision of the Plan, a Participant shall be fully
vested in his Accounts and shall be entitled to receive a
distribution of the entire amount then in his Accounts in
accordance with Section 7.4. if such Participant is employed
by Spenco Medical Corporation on the Closing Date of the sale
of Spenco Medical Corporation under the Agreement and Plan of
Merger entered into between the Corporation and Spenco
Medical Corporation, SBS Enterprises, Inc., Spenco
Acquisition Corporation and Steven B. Smith, dated March 4,
1994. For purposes of this Section, a Participant described
in the preceding sentence shall be treated under Section 7.4
as if he terminated employment with an Employer for a reason
other than death on the Closing Date; provided, however, that
a distribution pursuant to this Section shall be delayed to
the extent required by the Internal Revenue Service under
section 401(k)(2)(B)(i)(I) of the Code.
7.11 Form of ESOP Benefit. Notwithstanding anything in the Plan
to the contrary but subject to the provisions of Sections 7.4
and 7.6, the form of benefit payment available from the K-C
Stock Fund to a Participant, unless the Participant elects
otherwise, shall be substantially equal periodic payments
(not less frequently than annually) over a period not longer
than the greater of (i) five (5) years, or (ii) in the case
of a Participant whose vested portion of his Accounts exceeds
$500,000 (as adjusted by legislation or for cost-of-living
increases), five (5) years plus one (1) additional year (not
exceeding five (5) additional years) for each $100,000 (or
fraction of $100,000) (as adjusted by legislation or for
cost-of-living increases) by which the vested portion of his
Accounts exceeds $500,000 (as adjusted by legislation or for
cost-of-living increases).
[The following replaces section 7.11 effective September 1, 1994:]
7.11 Form of ESOP Benefit. Notwithstanding anything in the Plan
to the contrary but subject to the provisions of Sections 7.4
and 7.6, the form of benefit payment available to a
Participant, unless the Participant elects otherwise, shall
be substantially equal periodic payments (not less frequently
than annually) over a period not longer than the greater of
(i) five (5) years, or (ii) in the case of a Participant
whose vested portion of his Accounts exceeds $500,000 (as
adjusted by legislation or for cost-of-living increases),
five (5) years plus one (1) additional year (not exceeding
five (5) additional years) for each $100,000 (or fraction of
$100,000) (as adjusted by legislation or for cost-of-living
increases) by which the vested portion of his Accounts
exceeds $500,000 (as adjusted by legislation or for cost-of-
living increases).
[The following replaces section 7.11 effective January 1, 1995:]
7.11 Form of ESOP Benefit. Notwithstanding anything in the Plan
to the contrary but subject to the provisions of Sections
7.4(c) and 7.6, the form of benefit payment available to a
Participant, unless the Participant elects otherwise, shall
be substantially equal periodic payments (not less frequently
than annually) over a period not longer than the greater of
(i) five (5) years, or (ii) in the case of a Participant
whose vested portion of his Accounts exceeds $500,000 (as
adjusted by legislation or for cost-of-living increases),
five (5) years plus one (1) additional year (not exceeding
five (5) additional years) for each $100,000 (or fraction of
$100,000) (as adjusted by legislation or for cost-of-living
increases) by which the vested portion of his Accounts
exceeds $500,000 (as adjusted by legislation or for cost-of-
living increases).
7.12 ESOP Dividend Distributions. Dividends paid to the Trust
that had dividend record dates during a Plan Year on
Corporation Stock allocated to a Participant's Accounts shall
be paid to that Participant, or if applicable, to his
Beneficiary, in the first quarter of the Plan Year following
the Plan Year in which the dividends' record dates occurred.
Notwithstanding the preceding sentence, in the last quarter
of each Plan Year, a Participant who is employed by an
Employer or an affiliate of an Employer at the time of an
election under this Section may elect to have 25%, 50%, 75%,
or all of such dividend payments remain in the Trust in lieu
of a distribution under this Section. Dividends retained in
the Trust under this Section shall be invested as directed by
the Participant under Section 3.8. Notwithstanding both the
dollar amount (if any) of any election under this Section and
the preceding provisions of this Section, the amount actually
paid under this Section shall not exceed the lesser of (i)
the electing Participant's share of the dividends subject to
such election and (ii) his balance in his Accounts at the
time of payment.
ARTICLE VIII
FORMATION OF WITHDRAWAL YEAR AND MATURED
WITHDRAWAL YEAR; WITHDRAWALS DURING EMPLOYMENT
8.1 Withdrawal Years. A Withdrawal Year shall be formed under
the Plan for the Company Matching Contributions made for each
Plan Year. Each Withdrawal Year shall be and continue to be
identified separately up to the first day of the Plan Year
commencing with the third anniversary of its conclusion.
8.2 Matured Withdrawal Years. A separately identified Matured
Withdrawal Year shall be formed under the Plan to include all
amounts held in the Participants' Employer Accounts as of the
first day of the Plan Year commencing with the third
anniversary of each Withdrawal Year.
8.3 Regular Withdrawals. A Participant, subject to the
conditions stated below, may make the following Regular
Withdrawals:
(a) Such amount as the Participant may elect from the
Unrestricted After-Tax Contribution Section of his
Accounts;
(b) Such amounts as the Participant may elect from the Basic
After-Tax Contribution Section of his Accounts; and
(c) Such amounts as a Participant who has at least 5 years
of Service or a Participant who was employed by an
Employer prior to April 1, 1989, may elect from his
Employer Accounts for the Matured Withdrawal Years. Any
Participant not otherwise described above shall not be
eligible to make withdrawals from his Employer Accounts.
In the event of a Regular Withdrawal from the Basic After-
Tax Contribution section of a Participant's Accounts pursuant
to subsection 8.3(b), such Participant's Contributions under
the Plan shall be suspended for a period of 12 months
following such withdrawal.
8.4 Distribution of Regular Withdrawals. Regular Withdrawals
shall be permitted as of the Valuation Date following Timely
Notice (such Valuation Date being the Settlement Date for
such withdrawals). A distribution of a withdrawal shall be
made not later than 60 days after the Settlement Date or such
other time as specified by Committee rule. A Participant who
is entitled to receive a Regular Withdrawal may on Timely
Notice elect to receive such distribution in the form of
either a Lump Sum Distribution or a Lump Sum Optional
Distribution.
[The following replaces section 8.6 effective September 1, 1994:]
8.4 Distribution of Regular Withdrawals. Regular Withdrawals
shall be permitted as of the Valuation Date following Timely
Notice (such Valuation Date being the Settlement Date for
such withdrawals). A distribution of a withdrawal shall be
made not later than 60 days after the Settlement Date or such
other time as specified by Committee rule. A Participant who
is entitled to receive a Regular Withdrawal may on Timely
Notice elect to receive such distribution in the form of an
All Stock Distribution, a Stock and Cash Distribution or an
All Cash Distribution.
8.5 Miscellaneous.
(a) Notwithstanding anything in this Article VIII to the
contrary, the withdrawal provision of this Article VIII
shall not apply for Terminated Participants.
(b) In the event of the death, prior to his Settlement Date
with respect to the withdrawal, of a Participant who has
elected to make a withdrawal, and if the Committee has
notice of the Participant's death prior to such
distribution, then such withdrawal shall be deemed
revoked. In the event of the death of a Participant on
or after the Settlement Date with respect to which the
Participant has elected to make a withdrawal, but prior
to the actual distribution thereof, and if the Committee
has notice of the Participant's death prior to such
distribution, then such distribution shall be made to
the Participant's Beneficiary by the same method as it
would have been made to the Participant but for his
death.
ARTICLE IX
INCENTIVE INVESTMENT PLAN COMMITTEE
9.1 Membership. The Committee shall consist of at least three
persons who shall be officers or directors of the Corporation
or Eligible Employees. Members of the Committee shall be
appointed from time to time by, and shall serve at the
pleasure of, the Executive Committee of the Board. The
Committee shall elect one of its members as chairman. The
Committee shall not receive compensation for its services.
Committee expenses shall be paid by the Corporation.
9.2 Powers. The Committee shall have all such powers as may be
necessary to discharge its duties hereunder, including, but
not by way of limitation, the power to construe or interpret
the Plan, to determine all questions of eligibility
hereunder, to determine the method of payment of any Accounts
hereunder, to adopt rules relating to the giving of Timely
Notice, and to perform such other duties as may from time to
time be delegated to it by the Executive Committee of the
Board. The Committee may prescribe such forms and systems
and adopt such rules and actuarial methods and tables as it
deems advisable. It may employ such agents, attorneys,
accountants, actuaries, medical advisors, or clerical
assistants (none of whom need be members of the Committee) as
it deems necessary for the effective exercise of its duties,
and may delegate to such agents any power and duties, both
ministerial and discretionary, as it may deem necessary and
appropriate.
9.3 Procedures. A majority of the Committee members shall
constitute a quorum. The Committee may take any action upon
a majority vote at any meeting at which a quorum is present,
and may take any action without a meeting upon the unanimous
written consent of all members. All action by the Committee
shall be evidenced by a certificate signed by the chairman or
by the secretary to the Committee. The Committee shall
appoint a secretary to the Committee who need not be a member
of the Committee,and all acts and determinations of the
Committee shall be recorded by the secretary, or under his
supervision. All such records, together with such other
documents as may be necessary for the administration of the
Plan, shall be preserved in the custody of the secretary.
9.4 Rules and Decisions. All rules and decisions of the
Committee shall be uniformly and consistently applied to all
Eligible Employees and Participants under this Plan in
similar circumstances and shall be conclusive and binding
upon all persons affected by them. The Committee shall have
absolute discretion in carrying out its duties under the
Plan.
9.5 Authorization of Payments. Subject to the provisions hereof,
it shall be the duty of the Committee to furnish the Trustee
with all facts and directions necessary or pertinent to the
proper disbursement of the Trust funds.
9.6 Books and Records. The records of the Employers shall be
conclusive evidence as to all information contained therein
with respect to the basis for participation in the Plan and
for the calculation of Contributions and Company Matching
Contributions.
9.7 Perpetuation of the Committee. In the event that the
Corporation shall for any reason cease to exist, then, unless
the Plan is adopted and continued by a successor, the members
of the Committee at that time shall remain in office until
the final termination of the Trust, and any vacancies in the
membership of the Committee caused by death, resignation,
disability or other cause, shall be filled by the remaining
member or members of the Committee.
9.8 Claim Procedure. The Committee shall establish a procedure
for handling all claims by all persons. In the event any
claim is denied, the Committee shall provide a written
explanation to the person stating the reasons for denial.
9.9 Allocation or Reallocation of Fiduciary Responsibilities.
The Named Fiduciary may allocate powers and responsibilities
not specifically allocated by the Plan, or reallocate powers
and responsibilities specifically allocated by the Plan, to
designated persons, partnerships or corporations other than
the Committee, and the members of the Committee may allocate
their responsibilities under the Plan among themselves. Any
such allocation, reallocation, or designation shall be in
writing and shall be filed with and retained by the secretary
of the Committee with the records of the Committee.
Notwithstanding the foregoing, no reallocation of the
responsibilities provided in the Trust to manage or control
the Trust assets shall be made other than by an amendment to
the Trust.
9.10 Plan Administrator. The Corporation shall be the Plan
Administrator as described in ERISA.
9.11 Service of Process. The Corporation shall be the designated
recipient of service of process with respect to legal actions
regarding the Plan.
ARTICLE X
AMENDMENT AND TERMINATION
10.1 Amendment and Termination. While it is intended that the
Plan shall continue in effect indefinitely, the Board may
from time to time modify, alter or amend the Plan or the
Trust using its prescribed procedures for actions by the
Board and may at any time order the temporary suspension or
complete discontinuance of Company Matching Contributions or
may terminate the Plan, provided, however, that
(i) no such action shall make it possible for any part of
the Trust assets (except such part as is used for the
payment of expenses) to be used for or diverted to any
purpose other than for the exclusive benefit of
Participants or their Beneficiaries;
(ii) no such action shall adversely affect the rights or
interests of Participants theretofore vested under the
Plan; and
(iii) in the event of termination of the Plan or complete
discontinuance of Company Matching Contributions
hereunder, all rights and interests of Participants not
theretofore vested shall become vested as of the date of
such termination or complete discontinuance.
Any action permitted to be taken by the Board under the
foregoing provision regarding the modification, alteration or
amendment of the Plan or the Trust may be taken by the
Committee, using its prescribed procedures, if such action
(1) is required by law, or
(2) is required by collective bargaining, or
(3) is estimated not to increase the annual cost of the Plan
by more than $100,000.
The Committee shall report to the Board before January 31 of
each year all action taken by it hereunder during the
preceding calendar year.
However, nothing herein shall be construed to prevent any
modification, alteration or amendment of the Plan or of the
Trust which is required in order to comply with any law
relating to the establishment or maintenance of the Plan and
Trust, including but not limited to the establishment and
maintenance of the Plan or Trust as a qualified employee plan
or trust under the Code, even though such modification,
alteration, or amendment is made retroactively or adversely
affects the rights or interests of a Participant under the
Plan.
ARTICLE XI
MISCELLANEOUS
11.1 Non-Guarantee of Employment. Nothing contained in this Plan
shall be construed as a contract of employment between an
Employer and a Participant, or as a right of any Participant
to be continued in the employment of his Employer, or as a
limitation of the right of an Employer to discharge any
Participant with or without cause.
11.2 Rights to Trust Assets. No Participant or any other person
shall have any right to, or interest in, any part of the
Trust assets upon termination of his employment or otherwise,
except as provided from time to time under this Plan, and
then only to the extent of the amounts due and payable to
such person out of the assets of the Trust. All payments as
provided for in this Plan shall be made solely out of the
assets of the Trust and neither the Employers, the Trustee,
nor any member of the Committee shall be liable therefor in
any manner.
The Employers shall have no beneficial interest of any nature
whatsoever in any Employer Contributions after the same have
been received by the Trustee, or in the assets, income or
profits of the Trust, or any part thereof, except to the
extent that forfeitures as provided in the Plan shall be
applied to reduce the Employer Contributions.
11.3 Disclaimer of Liability. Neither the Trustee, the Employers,
nor any member of the Committee shall be held or deemed in
any manner to guarantee the funds of the Trust against loss
or depreciation.
11.4 Non-Recommendation of Investment. The availability of any
security hereunder shall not be construed as a recommendation
to invest in such security. The decision as to the choice of
investment of Contributions must be made solely by each
Participant, and no officer or employee of the Corporation or
the Trustee is authorized to make any recommendation to any
Participant concerning the allocation of Contributions
hereunder.
11.5 Indemnification of Committee. The Employers shall indemnify
the Committee and each of its members and hold them harmless
from the consequences of their acts or conduct in their
official capacity, including payment for all reasonable legal
expenses and court costs, except to the extent that such
consequences are the result of their own willful misconduct
or breach of good faith.
11.6 Selection of Investments. The Trustee shall have the sole
discretion to select investments for the various funds
provided for herein even though the same may not be legal
investments for trustees under the laws applicable thereto.
11.7 Non-Alienation. Except as otherwise provided herein, no
right or interest of any Participant or Beneficiary in the
Plan and the Trust shall be subject in any manner to
anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance, charge, attachment, garnishment, execution,
levy, bankruptcy, or any other disposition of any kind,
either voluntary or involuntary, prior to actual receipt of
payment by the person entitled to such right or interest
under the provisions hereof, and any such disposition or
attempted disposition shall be void.
11.8 Facility of Payment. If the Committee has notice that a
Participant entitled to a distribution hereunder, or his
Beneficiary, is incapable of caring for his own affairs,
because of illness or otherwise, the Committee may direct
that any distribution from such Participant's Accounts may be
made, in such shares as the Committee shall determine, to the
spouse, child, parent or other blood relative of such
Participant, or his Beneficiary, or any of them, or to such
other person or persons as the Committee may determine, until
such date as the Committee shall determine that such
incapacity no longer exists. The Committee shall be under no
obligation to see to the proper application of the
distributions so made to such person or persons, and any such
distribution shall be a complete discharge of any liability
under the Plan to such Participant, or his Beneficiary, to
the extent of such distribution.
11.9 Allocation in the Event of Advance Contributions. In the
event that the Employer's tax deduction with respect to
amounts contributed to the Plan pursuant to Articles III and
IV for the months in the final quarter of a Plan Year results
in such amounts being deemed advanced contributions of the
Employer with respect to the taxable year of the Employer
ending within such Plan Year, such amounts shall be
considered allocated pursuant to Articles III and IV, as
applicable, as of the last day of such taxable year.
11.10 Executive Committee of the Board. Any action which is
required or permitted to be taken by the Board under the
Plan may be taken by the Executive Committee of the
Board or any authorized committee of the Board.
11.11 Qualified Domestic Relations Orders. Anything in this
Plan to the contrary notwithstanding:
(a) Alternate Payee's Accounts. An alternate payee under a
domestic relations order determined by the Corporation
to be a qualified domestic relations order (as defined
in Code section 414(p)) shall have established and
maintained for him separate Accounts similar to the
Accounts of the Participant specified in the qualified
domestic relations order. The alternate payee's
Accounts shall be credited with his interest in such
Participant's Accounts, as determined under the
qualified domestic relations order. Except to the
extent specifically provided by the qualified domestic
relations order, no amount of the non-vested portion, if
any, of the Participant's Employer Accounts shall be
credited to the alternate payee's Accounts. Subsection
6.2(d) and Sections 6.3, 6.4 and 6.5 shall apply to the
alternate payee's Accounts as if the alternate payee
were a Participant.
(b) Investment of Alternate Payee's Accounts. On or after
the date which is three months following the effective
date of the qualified domestic relations order, an
alternate payee may on Timely Notice elect to
reallocate, effective as of the first Valuation Date
following his election, all or any percentage portion of
any of his Employee Accounts or Employer Accounts or
both, provided the alternate payee has not elected a
reallocation within the preceding three months. An
alternate payee's interest arising from this
reallocation shall be invested in the various funds in
accordance with the alternate payee's directions. For
purposes of subsection 6.1(b), any such reallocation
shall be treated as a reallocation in accordance with
subsection 6.1(a).
(c) Alternate Payee's Beneficiary. Except to the extent
otherwise provided by the qualified domestic relations
order relating to an alternate payee:
(i) the alternate payee may designate on Timely Notice
a beneficiary,
(ii) if no such person is validly designated or if the
designated person predeceases the alternate payee,
the beneficiary of the alternate payee shall be his
estate, and
(iii) the beneficiary of the alternate payee shall be
accorded under the Plan all the rights and
privileges of the Beneficiary of a Participant.
(d) Distribution to Alternate Payee. An alternate payee
shall be entitled to receive a distribution from the
Plan in accordance with the qualified domestic relations
order relating to the alternate payee. Such
distribution may be made only in a method provided in
Section 7.4 and shall include only such amounts as have
become vested; provided, however, that if a qualified
domestic relations order so provides, a lump sum
distribution of the total vested amount credited to the
alternate payee's Accounts may be made to the alternate
payee before the date that the Participant specified in
the qualified domestic relations order attains his
earliest retirement age (as defined in Code section
414(p)(4)(B)). A qualified domestic relations order may
provide that until a distribution is made to the
alternate payee, the alternate payee may make
withdrawals in accordance with Article VIII as if the
alternate payee were an employed Participant; provided,
however, that no withdrawal suspension penalties shall
be imposed on account of a withdrawal by an alternate
payee.
(e) Vesting of Alternate Payee's Accounts. In the event
that the qualified domestic relations order provides for
all or part of the non-vested portion of the
Participant's Employer Accounts to be credited to the
Accounts of the alternate payee, such amounts shall vest
and/or be forfeited at the same time and in the same
manner as the Accounts of the Participant specified in
the qualified domestic relations order; provided,
however, that no forfeiture shall result to the Accounts
of the alternate payee due to any distribution to or
withdrawal by the Participant from his Accounts or any
distribution to or withdrawal by the alternate payee
from the vested portion of the Accounts of the alternate
payee.
11.12 Tax Reform Act of 1986; Special Effective Dates. In
addition to the other limitations set forth in the Plan
and notwithstanding the provisions relating to the
effective date of the Plan, the Plan shall be or shall
have been administered (i) according to the applicable
provisions (as determined by the Committee) of the Tax
Reform Act of 1986 and (ii) with the following
provisions effective as of the dates specified:
(a) Subsections 2.1(b) and 4.4, relating to the Actual
Contribution Percentage, which shall be effective
April 1, 1987;
(b) Subsection 2.1(c), relating to the definition of
Affiliated Employer for purposes of Article XIV,
which shall be effective April 1, 1987;
(c) Subsection 2.1(d), relating to the limit on
compensation used to determine a Participant's Base
Hourly Wages which shall be effective January 1,
1989;
(d) Subsection 2.1(q), relating to exclusion of leased
employees from definition of Eligible Employee,
which shall be effective for services performed
after December 31, 1986;
(e) Subsection 2.1(jj), relating to the definition of
Highly Compensated Eligible Employee, which shall
be effective April 1, 1987;
(f) Subsections 2.1(aaa) and 3.2(c), relating to
Special Unrestricted After-Tax Contributions which
shall be effective April 1, 1989;
(g) Subsection 2.1(fff), relating to Total
Compensation, which shall be effective April 1,
1987, with said limitation contained therein,
effective January 1, 1989;
(h) Subsection 7.1(d), relating to the vesting
provisions under the Plan, which shall be effective
April 1, 1989;
(i) Sections 8.1 through 8.5, relating to withdrawals
from the Plan, which shall be effective April 1,
1989;
(j) Subsections 12.1(a)(1)(C), 12.1(a)(ii)(D),
12.1(a)(ii)(F) through (G), and 12.1 (a)(vi)(A)(1),
relating to the limit on Annual Additions to the
Plan, which shall be effective for Limitation Years
beginning after December 31, 1986.
ARTICLE XII
LIMITATIONS ON BENEFITS
12.1 Definitions and Rules:
(a) Definitions: For purposes of Article XII, the following
definitions and rules of interpretation shall apply.
(i) "Annual Additions" to a Participant's Accounts
under this Plan is the sum, credited to a
Participant's Accounts for any Limitation Year, of:
(A) Company contributions,
(B) forfeitures, if any, and
(C) Participant Contributions.
(ii) "Annual Benefit" -
(A) A benefit which is payable annually in the
form of a straight life annuity under a
defined benefit plan maintained by the Company
which is subject to the limitations of Code
section 415; in the case of such a benefit
which is not payable in the form of a straight
life annuity, the benefit will be adjusted in
accordance with Section 12.1(a)(ii)(C) below.
(B) When there is a transfer of assets or
liabilities from one qualified plan to
another, the Annual Benefit attributable to
the assets transferred shall not be taken into
account by the transferee plan in applying the
limitations of Code section 415. The Annual
Benefit payable on account of the transfer for
any individual that is attributable to the
assets transferred will be equal to the annual
benefit transferred on behalf of such
individual multiplied by a fraction, the
numerator of which is the value of the total
assets transferred and the denominator of
which is the value of the total liabilities
transferred.
(C) In the case of a retirement benefit under a
defined benefit plan subject to the
limitations of Code section 415(b) which is in
any form other than a straight life annuity,
such benefit will be adjusted to a straight
life annuity beginning at the same age which
is the actuarial equivalent of such benefit in
accordance with applicable regulations and
rules determined by the Commissioner, but
without taking into account:
(1) the value of a qualified joint and
survivor annuity (as defined in Code
section 401(a)(11)(G)(iii) and the
regulations thereunder) provided by a
defined benefit plan to the extent that
such value exceeds the sum of (a) the
value of a straight life annuity
beginning on the same date and (b) the
value of any post-retirement death
benefits which would be payable even if
the annuity were not in the form of a
joint and survivor annuity,
(2) the value of benefits that are not
directly related to retirement benefits
(such as, but not limited to, pre-
retirement disability and death
benefits), and
(3) the value of benefits provided by a
defined benefit plan which reflect post-
retirement cost of living increases to
the extent that such increases are in
accordance with Code section 415(d) and
the regulations thereunder.
(D) In the case of a retirement benefit beginning
before the Social Security Retirement Age
under a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(E) If a Participant has less than 10 Years of
Vesting Service with the Company at the time
the Participant begins to receive retirement
benefits under a defined benefit plan, the
benefit limitations described in Code section
415(b)(1) and (4) are to be reduced by
multiplying the otherwise applicable
limitation by a fraction, the numerator of
which is the number of Years of Vesting
Service with the Company as of, and including,
the current Limitation Year, and the
denominator of which is 10. For purposes of
this paragraph (E), Years of Vesting Service
shall be determined in accordance with such
defined benefit plan.
(F) In the case of a retirement benefit beginning
after the Social Security Retirement Age under
a defined benefit plan subject to the
limitations of Code section 415(b), such
benefit will be adjusted to the actuarial
equivalent of a benefit beginning at the
Social Security Retirement Age in accordance
with applicable regulations and rules
determined by the Commissioner, but this
adjustment is only for purposes of applying
the dollar limitation described in Code
section 415(b)(1)(A) to the Annual Benefit of
the Participant.
(G) For purposes of this Section, the "Social
Security Retirement Age" shall mean the age
used as the retirement age under section
216(l) of the Social Security Act, applied
without regard to the age increase factor and
as if the early retirement age under section
216(l)(2) of the Social Security Act were 62.
(iii) "Company" - any corporation which is a
member of a controlled group of corporations (as
defined in Code section 414(b) and modified by Code
section 415(h)) or an affiliated service group (as
defined in Code section 414(m)) which includes an
Employer; any trades or businesses (whether or not
incorporated) which are under common control (as
defined in Code section 414(c) and modified by Code
section 415(h)) with an Employer; or any other
entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(iv) "Compensation" with respect to a Limitation Year -
(A) includes amounts actually paid or made
available to a Participant (regardless of
whether he was such during the entire
Limitation Year);
(1) as wages, salaries, fees for professional
service, and other amounts received for
personal services actually rendered in
the course of employment with the Company
including but not limited to commissions,
compensation for services on the basis of
a percentage of profits and bonuses;
(2) for purposes of (i) above, earned income
from sources outside the United States
(as defined in Code section 911(b));
whether or not excludable from gross
income under Code section 911 or
deductible under Code section 913;
(3) amounts described in Code sections
104(a)(3), 105(a) and 105(h) but only to
the extent that these amounts are
includable in the gross income of the
Participant;
(4) amounts paid or reimbursed by the Company
for moving expenses incurred by the
Participant, but only to the extent that
these amounts are not deductible by the
Participant under Code section 217;
(5) value of a nonqualified stock option
granted to the Participant, but only to
the extent that the value of the option
is includable in the gross income of the
Participant in the taxable year in which
granted;
(6) the amount includable in the gross income
of a Participant upon making the election
described in Code section 83(b).
(B) excludes -
(1) contributions made by the Company to a
plan of deferred compensation to the
extent that, before the application of
the Code section 415 limitations to that
plan, the contributions are not
includable in the gross income of the
Participant for the taxable year in which
contributed and any distributions from a
plan of deferred compensation, regardless
of whether such amounts are includable in
the gross income of the Participant when
distributed; provided, however, any
amounts received by a Participant
pursuant to an unfunded nonqualified plan
shall be considered as Compensation in
the year such amounts are includable in
the gross income of the Participant;
(2) amounts realized from the exercise of a
nonqualified stock option, or recognized
when restricted stock (or property) held
by a Participant either becomes freely
transferable or is no longer subject to a
substantial risk of forfeiture pursuant
to Code section 83 and the regulations
thereunder;
(3) amounts realized from the sale, exchange
or other disposition of stock acquired
under a qualified stock option;
(4) other amounts which receive special tax
benefits such as premiums for group term
life insurance (but only to the extent
that the premiums are not includable in
the gross income of the Participant); and
(5) Compensation in excess of $200,000 (as
automatically increased in accordance
with applicable regulations to reflect
cost-of-living adjustments).
(v) "Limitation Year" - a calendar year.
(vi) "Maximum Permissible Amount" -
(A) for a Limitation Year, with respect to any
Participant, subject to the rule in
paragraph (B), the lesser of
(1) $30,000 (or, if greater, 1/4 of the
dollar limitation in effect under Code
section 415(b)(1)(A)), or
(2) 25% of the Participant's Compensation for
the Limitation Year.
(B) As of January 1 of each calendar year, the
dollar limitation set forth in subparagraph
(A)(1) above shall be adjusted automatically
for cost-of-living increases to equal the
dollar limitation as determined by the
Commissioner for that calendar year under Code
section 415(d)(1)(B). This adjusted dollar
limitation applies for the Limitation Year
ending with that calendar year.
(vii) "Projected Annual Benefit" - the Annual Benefit to
which a Participant would be entitled under a
defined benefit plan maintained by the Company on
the assumptions that he or she continues employment
until the normal retirement age (or current age, if
that is later) thereunder, that his or her
Compensation continues at the same rate as in
effect for the Limitation Year under consideration
until such age, and that all other relevant factors
used to determine benefits under the Plan remain
constant as of the current Limitation Year for all
future Limitation Years.
(b) Other Rule. For purposes of applying the limitations of
Code section 415(b), (c) and (e) applicable to a
Participant for a particular Limitation Year, all
qualified defined contribution plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as part of this Plan and all
qualified defined benefit plans (without regard to
whether a plan has been terminated) ever maintained by
the Company will be treated as one defined benefit plan.
12.2 Limits:
(a) Annual Addition Limit. The amount of the Annual
Addition which may be credited under this Plan to any
Participant's Accounts as of any allocation date shall
not exceed the Maximum Permissible Amount (based upon
his Compensation up to such allocation date) reduced by
the sum of any Annual Additions made to the
Participant's Accounts under this Plan as of any
preceding allocation date within the Limitation Year.
If an allocation date of this Plan coincides with an
allocation date of any other qualified defined
contribution plan maintained by the Company, the amount
of the Annual Additions which may be credited under this
Plan to any Participant's Accounts as of such date shall
be an amount equal to the product of the amount to be
credited under this Plan without regard to this Section
12.2 multiplied by the lesser of 1.0 or a fraction, the
numerator of which is the amount described in this
subsection (a) of Section 12.2 during the Limitation
Year and the denominator of which is the amount that
would otherwise be credited on this allocation date
under all plans without regard to this Section 12.2. If
contributions to this Plan by or on behalf of a
Participant are to be reduced as a result of this
Section 12.2, such reduction shall be effected by first
reducing any Unrestricted After-Tax Contributions and
second, if and to the extent necessary, by
proportionately reducing any Basic After-Tax
Contributions and corresponding Company Matching
Contributions. If as a result of a reasonable error in
estimating a Participant's Compensation, or under the
limited facts and circumstances which the Commissioner
finds justify the availability of the rules set forth in
this Section 12.2, the allocation of Annual Additions
under the terms of the Plan for a particular Participant
would cause the limitations of Code section 415
applicable to that Participant for the Limitation Year
to be exceeded, the excess amounts shall not be deemed
to be Annual Additions in that Limitation Year if they
are treated as follows:
(i) The excess amounts in the Participant's Account
consisting of Participant Contributions and any
increment attributable thereto shall be paid to the
Participant as soon as administratively feasible.
(ii) The excess amounts in the Participant's Account
consisting of Company Matching Contributions shall
be used to reduce Company Matching Contributions
for the next Limitation Year (and succeeding
Limitation Years, as necessary) for that
Participant if that Participant is covered by the
Plan as of the end of the Limitation Year.
However, if that Participant is not covered by the
Plan as of the end of the Limitation Year then the
excess amounts must be held unallocated in a
suspense account for the Limitation Year and
allocated and reallocated in the next Limitation
Year to all of the remaining Participants in the
Plan. If a suspense account is in existence at any
time during a particular Limitation Year, other
than the first Limitation Year described in the
preceding sentence, all amounts in the suspense
account must be allocated and reallocated to
Participant's Accounts (subject to the limitations
of Code section 415) before any Employer
Contributions and Participant Deposits which would
constitute Annual Additions may be made to the Plan
for that Limitation Year and such excess amounts
must be used to reduce Company Matching
Contributions for the next Limitation Year (and
succeeding Limitation Plan Years, as necessary) for
all of the remaining Participants in the Plan. For
purposes of this subdivision, excess amounts may
not be distributed to Participants or former
Participants.
(iii) In the event of termination of the Plan the
suspense account described in (ii) above shall
revert to the Employer to the extent it may not
then be allocated to any Participant's Account.
(iv) Notwithstanding any other provision in this Section
12.2, the Employer shall not contribute any amount
that would cause an allocation to the suspense
account as of the date the contribution is
allocated. If the contribution is made prior to
the date as of which it is to be allocated, then
such contribution shall not exceed an amount that
would cause an allocation to the suspense account
if the date of contribution were an allocation
date.
(b) Overall Limit. For any Participant of this Plan who at
any time participated in a defined benefit plan
maintained by the Company, the rate of benefit accrual
by such Participant in each defined benefit plan in
which the Participant participates during the Limitation
Year will be reduced to the extent necessary to prevent
the sum of the following fractions, computed as of the
close of the Limitation Year, from exceeding 1.0:
(i) The Projected Annual Benefit of the Participant
under the defined benefit plan
over
The lesser of (1) the product of 1.25 multiplied by
the dollar limitation in effect under Code section
415(b)(1)(A) for such Limitation Year or (2) the
product of 1.4 multiplied by the amount which may
be taken into account under Code section
415(b)(1)(B) with respect to such Participant for
such Limitation Year,
plus
(ii) The sum of Annual Additions to such Participant's
Accounts under this Plan in such Limitation Year
and for all prior Limitation Years
over
The sum of the lesser of the following amounts
determined for such year and for each prior year of
service with the Company: (1) the product of 1.25
multiplied by the dollar limitation in effect under
Code section 415(c)(1)(A) for such Limitation Year
or (2) the product of 1.4 multiplied by 25% of the
Participant's Compensation for such Limitation
Year.
(c) Special Rules Applicable to Computation of Overall
Limit.
(i) For purposes of applying the defined contribution
plan fraction in Section 12.2(b), for any
Limitation Year beginning after December 31, 1975,
the following rules shall apply with respect to
Limitation Years before January 1, 1976:
(A) The aggregate amount taken into account in
determining the numerator of such fraction is
deemed not to exceed the aggregate amount
taken into account in determining the
denominator of the fraction.
(B) The amount taken into account for purposes of
subsection 12.1(a)(i)(C)(1) is an amount equal
to the excess of the aggregate amount of the
Participant's contributions for such years
during which he was an active participant in
the Plan over 10% of the Participant's
aggregate Compensation for all such years,
multiplied by a fraction, the numerator of
which is 1.0 and the denominator of which is
the number of years beginning before
January 1, 1976, during which the Participant
participated in the Plan. Participant
contributions made on or after October 2,
1973, shall be taken into account for purposes
of the preceding sentence only to the extent
that the amount of such contributions was
permissible under a plan as in effect on that
date.
(ii) In any case where the sum of the fractions in
Section 12.2(b) is greater than 1.0 calculated as
of the close of the last Limitation Year beginning
before January 1, 1983 for a Participant in
accordance with regulations prescribed by the
Commissioner pursuant to Section 235(g)(3) of the
Tax Equity and Fiscal Responsibility Act of 1982,
an amount shall be subtracted from the numerator of
the defined contribution plan fraction so that the
sum of such fractions does not exceed 1.0 for such
Limitation Year.
ARTICLE XIII
MERGER
No merger or consolidation with or transfer of any assets or
liabilities to any other plan after September 2, 1974, shall be
made unless, upon completion thereof, the value of each
Participant's Account shall immediately after said merger,
consolidation, or transfer be equal to or greater than the value
of the Participant's Account immediately before the merger,
consolidation, or transfer (if the Plan had then terminated).
ARTICLE XIV
TOP-HEAVY REQUIREMENTS
14.1 Top-Heavy Requirements. Notwithstanding any other provisions
of this Plan, the following rules shall apply for any
Plan Year if as of the last day of the preceding Plan Year,
based on valuations as of such date, the sum of the present
value of accrued benefits and Accounts of "key employees"
(within the meaning of Code section 416) exceeds 60% of a
similar sum for all employees under each plan of the Employer
or any Affiliated Employer in which a "key employee"
participates and each other plan of the Employer or any
Affiliated Employer which enables any such plan to meet the
requirements of Code section 401(a)(4) or 410. A Plan Year
during which such rules apply shall be known as a "Top-Heavy
Plan Year."
(a) Vesting. A Participant who is credited with an
Hour of Service during the Top-Heavy Plan Year, or in
any Plan Year after the Top-Heavy Plan Year, and who has
completed at least three years of Service shall have a
nonforfeitable right to 100% of his Employer Accounts
and no such amount may become forfeitable if the Plan
later ceases to be Top-Heavy nor may such amount be
forfeited under the provisions of Code sections
411(a)(3)(B) (relating to suspension of benefits upon
reemployment) or 411(a)(3)(D) (relating to forfeitures
upon withdrawal of mandatory contributions). If the
Plan become Top-Heavy and later ceases to be Top-Heavy,
this vesting schedule shall no longer apply and benefits
which have not at such time vested under this schedule
shall vest only in accordance with other provisions of
this Plan, provided that any Participant with at least 3
years of Service shall be entitled to continue to
utilize this schedule for vesting purposes by making an
election at the time and in the manner specified by the
Committee.
(b) Required Contributions. Each Employer shall contribute
on behalf of each employee eligible to participate in
the Plan, the lesser of:
(i) 3% of such employee's compensation (within the
meaning of Code section 415); or
(ii) the percentage of such employee's compensation
(within the meaning of Code section 415) which is
equal to the percentage at which contributions were
made for that Plan Year on behalf of the "key
employee" for whom such percentage is the greatest
for such Plan Year, as prescribed by Code section
416(c)(2)(B) and regulations thereunder;
provided, however, that any contributions for any
employee required of any Employer by the above
provisions of this subsection 14.1(b) shall be reduced
by the amount of any Company Matching Contribution made
with respect to such Plan Year for such employee under
Article IV of this Plan. Any contribution made pursuant
to this subsection 14.1(b) shall be allocated to the
Employer Stock Account on behalf of the employee for
whom such contribution is made.
(c) Additional Limitations. No allocations may be made to
the Account of a Participant the sum of whose defined
benefit plan fraction and defined contribution plan
fraction, as defined in Code section 415(e), exceeds 1.0
when the dollar amounts, as defined in Section 12.2(b)
hereof, are multiplied by 1.0 rather than 1.25.
The provisions of this Section 14.1 shall be interpreted
in accordance with the provisions of Code section 416
and any regulations thereunder, which are hereby
expressly incorporated by reference.
(d) Coordination. In the event a top heavy minimum
contribution or benefit is required under this Plan or
another plan of an Employer that covers a Participant,
the top heavy minimum contribution or benefit, as
appropriate, shall be provided in this Plan.
H-61-A
APPENDIX A
LIST OF EMPLOYERS, PARTICIPATING UNITS, APPLICABLE SCHEDULES
AND EFFECTIVE DATES OF PARTICIPATION IN THE PLAN
Employers and Participating Units Schedule Effective Date
Avent, Inc. - -
No Participating Units.
Coosa Pines Golf Club, Incorporated XXVIII July 1, 1989
All hourly employees of this
Employer, including those on
temporary assignment in other
classifications or at other
Employers, but excluding
employees on temporary
assignment from another
Employer or classification.
K-C Aviation Inc. --
No Participating Units.
Kimberly-Clark Corporation
(a) Ancram Mill: All hourly XX January 1, 1985
employees of this unit
who are represented by
the United Paperworkers
International Union, AFL-
CIO, Local No. 1479,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(b) Atlas Mill: All hourly XIV April 1, 1981
employees of this unit
who are represented by
the Kimberly-Clark Atlas
Union, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(c) Beech Island Mill: All II February 1, 1968
hourly employees of this
unit, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(d) Berkeley Mills: All III August 1, 1967
hourly employees of this
unit, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(e) Brown-Bridge Division: X January 1, 1975
All hourly employees of
this unit, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification.
(f) Coosa Forest Products- XXIX July 1, 1989
Goodwater, Roanoke,
Nixburg and Ashville:
All hourly employees of
this unit, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification.
(g) Coosa Forest Products- XXX April 1, 1991
Mountain Shadows:
All hourly employees of
this unit, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification."
(h) Coosa Mill: All hourly XXVI April 1, 1987
employees of this unit
who are represented by
the United Paperworkers
International Union, AFL-
CIO, Locals 692, 1693,
1595 and 692-Woodlands;
the United Association of
Journeymen and
Apprentices of the
Plumbing and Pipefitting
Industry of the United
States and Canada, Local
91; the International
Brotherhood of Electrical
Workers, Local 1629; and
the International
Association of Machinists
and Aerospace Workers,
Local Lodge 985,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(i) Fullerton Mill: All XXV October 1, 1986
hourly employees of this
unit who are represented
by the Association of
Western Pulp &
Paperworkers, Local No.
672, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(j) Kimtech Plant: All XV January 1, 1988
hourly machinery (Kimtech Ltd. -
installation employees of January 1, 1984
this unit who are through
represented by Local December 31, 1987)
Lodge No. 1855 of the
International Association
of Machinists and
Aerospace Workers, AFL-
CIO, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification
(k) Kimtech Plant: All XVII January 1, 1988
hourly machinist (Kimtech Ltd. -
employees of this unit January 1, 1984
who are represented by through
Lodge No. 1855 of the December 31, 1987)
International Association
of Machinists and
Aerospace Workers, AFL-
CIO, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(l) Karolton Envelope - Ohio: XXVII October 1, 1988
All hourly employees of
this unit who are
represented by the United
Paperworkers
International Union, AFL-
CIO, Local 1792,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(m) LaGrange Mill: All XXII January 1, 1986
nonexempt salaried
employees of this unit,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(n) Lee Mills: All hourly XIX October 1, 1984
employees of this unit
who are represented by
The United Paperworkers
International Union, AFL-
CIO, Local 78, including
those on temporary
assignment in other
classifications or at
other units of Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification.
(o) Lexington Mill: All XXI October 1, 1985
nonexempt salaried
employees of this unit,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(p) Maumelle Facility: All XXXII July 1, 1992
nonexempt salaried
employees of this unit,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(q) Memphis Mill: All hourly VI July 1, 1974
employees of this unit
who are represented by
The United Paperworkers
International Union,
affiliated with the AFL-
CIO, and the respective
Local Unions Nos. 704,
751 and 566, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification.
(r) Memphis Mill: All hourly VII July 1, 1974
employees of this unit
who are represented by
the International
Association of Machinists
and Aerospace Workers,
Local DeSoto Lodge No. 3,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(s) Minnesota Fiber Mills: VIII August 1, 1967
All hourly employees of
this unit, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification.
(t) Munising Mill: All XVI October 1, 1982
hourly employees of this
unit who are represented
by the United
Paperworkers
International Union,
Locals No. 87 and 96,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(u) Neenah Mill: All hourly XII April 1, 1979
employees of this unit
who are represented by
The United Paperworkers
International Union,
affiliated with the AFL-
CIO, Local Union No. 482,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(v) Neenah Paper: All hourly XIII April 1, 1979
employees of this unit
who are represented by
the United Paperworkers
International Union,
Local No. 1170, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding hourly
employees at the Whiting
Mill and employees on
temporary assignment from
another unit, Employer or
classification.
(w) Neenah Paper - Whiting XXXIII April 1, 1993
Mill: All hourly
employees of this unit
who are represented by
the United Paperworkers
International Union, AFL-
CIO, Local 370, including
those on temporary
assignment in other
classifications or at
other units or Employers,
but excluding employees
on temporary assignment
from another unit,
Employer or
classification.
(x) New Milford Mill: All IX August 1, 1967
hourly employees of this
unit, including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(y) Ogden Mill: All XXIII July 1, 1986
nonexempt salaried
employees of this unit,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(z) Paris Plant: All XVIII April 1, 1984
nonexempt salaried
employees of this unit,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
(aa) Spotswood Mill: All XXIV October 1, 1986
hourly
employees of this unit
who are represented by
the United Paperworkers
International Union, AFL-
CIO, Local No. 1482,
including those on
temporary assignment in
other classifications or
at other units or
Employers, but excluding
employees on temporary
assignment from another
unit, Employer or
classification.
Kimberly-Clark Integrated Services XI July 1, 1981
Corporation: (Integrated
All professional drivers Services Division/
(other than casual drivers) Company -
and hourly employees of this January 1, 1976
Employer, including those on through June 30,
temporary assignment in other 1981)
classifications or at other
Employers, but excluding
employees on temporary
assignment from another
Employer or classification.
Kimberly-Clark International - -
Services Corporation
No Participating Units.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES
INCENTIVE INVESTMENT PLAN
APPENDIX
REVENUE RECONCILIATION ACT OF 1993 AMENDMENTS
In addition to other applicable limitations which may be set forth
in the Plan and notwithstanding any other contrary provision of
the Plan, compensation taken into account under the plan shall not
exceed $150,000, adjusted for changes in the cost of living as
provided in section 415(d) of the Internal Revenue Code, for the
purpose of calculating a Plan participant's accrued benefit
(including the right to any optional benefit provided under the
Plan) for any Plan Year commencing after December 31, 1993.
However, the accrued benefit determined in accordance with this
provision shall not be less than the accrued benefit determined on
January 1, 1994, without regard to this provision.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE II
(As amended through March 31, 1993)
(Beech Island Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Beech Island Mill, the
Plan shall apply with full force and effect except as may be
otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE III
(As amended through March 31, 1993)
(Berkeley Mills)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Berkeley Mills, the Plan
shall apply with full force and effect except as may be otherwise
provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE VI
(As amended through March 31, 1993)
(Memphis Mill - Paperworkers Unit)
and SCHEDULE VII
(As amended through March 31, 1993)
(Memphis Mill - IAM Unit)
With respect to the Participating Unit under Schedule VI,
consisting of all hourly employees of the Memphis Mill who are
represented by The United Paperworkers International Union,
affiliated with AFL-CIO, and the respective Local Unions Nos. 704,
751 and 566, and with respect to the Participating Unit under
Schedule VII, consisting of all hourly employees of the Memphis
Mill who are represented by the International Association of
Machinists and Aerospace Workers, Local DeSoto Lodge No. 3, this
Plan shall apply with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE VIII
(As amended through March 31, 1993)
(Minnesota Fiber Operations)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Minnesota Fiber
Operations, the Plan shall apply with full force and effect except
as may be otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE IX
(As amended through March 31, 1993)
(New Milford Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the New Milford Mill, the
Plan shall apply with full force and effect except as may be
otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE X
(As amended through March 31, 1993)
(Brown-Bridge Division)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Brown-Bridge Division,
the Plan shall apply with full force and effect except as may be
otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XI
(As amended through March 31, 1993)
(Kimberly-Clark Integrated Services Corporation)
With respect to the Participating Unit under this Schedule, the
Plan shall apply with full force and effect except as may be
otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XII
(As amended through March 31, 1993)
(Neenah Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Neenah Mill who are
represented by The United Paperworkers International Union,
affiliated with the AFL-CIO, Local Union No. 482, the Plan shall
apply with full force and effect, except as may be otherwise
provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XIII
(As amended through March 31, 1993)
(Neenah Paper)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of Neenah Paper - Neenah who
are represented by the United Paperworkers International Union,
Local No. 1170, the Plan shall apply with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XIV
(As amended through March 31, 1993)
(Atlas Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Atlas Mill who are
represented by the Kimberly-Clark Atlas Union, the Plan shall
apply with full force and effect except as may be otherwise
provided from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XV
(As amended through March 31, 1993)
(Kimtech Plant - Machinery Installation Unit)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the machinery installation
unit of the Kimtech Plant who are represented by Local Lodge No.
1855 of the International Association of Machinists and Aerospace
Workers, AFL-CIO, the Plan shall apply with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XVI
(As amended through March 31, 1993)
(Munising Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Munising Mill who are
represented by the United Paperworkers International Union, Locals
Nos. 87 and 96, the Plan shall apply with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XVII
(As amended through March 31, 1993)
(Kimtech Plant - Machinists Unit)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the machinists unit of the
Kimtech Plant who are represented by Local Lodge No. 1855 of the
International Association of Machinists and Aerospace Workers,
AFL-CIO, the Plan shall apply with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XVIII
(As amended through March 31, 1993)
(Paris Plant)
With respect to the Participating Unit under this Schedule,
consisting of all nonexempt salaried employees of the Paris Plant,
the Plan shall apply with full force and effect, except as may be
otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XIX
(As amended through March 31, 1993)
(Lee Mills)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of Lee Mills who are
represented by the United Paperworkers International Union, AFL-
CIO, Local No. 78, the Plan shall apply with full force and
effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XX
(As amended through May 24, 1994)
(Ancram Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Ancram Mill who are
represented by the United Paperworkers International Union, AFL-
CIO, Local No. 1479, the Plan shall apply with full force and
effect except that Articles II and IV of this Schedule shall apply
in lieu of the same numbered Articles of the Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Stock and Cash Distribution: As defined in subsection
7.3(b).
(fff) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(ggg) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(hhh) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(iii) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(jjj) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(kkk) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(lll) Trustee: The trustee under the Trust.
(mmm) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(nnn) Valuation Date: The last day of each month.
(ooo) Withdrawal Year: As defined in Section 8.1.
(ppp) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.4, Company
Matching Contributions for each twelve calendar month period
beginning on April 1 of one year and ending March 31 of the
following year (herein called the "Match Year") shall be not
less than 10% nor more than 50% of Basic After-Tax
Contributions. Within such limits, Company Matching
Contributions for each Match Year shall depend upon the
allocation of Basic After-Tax Contributions by Participants
and upon Profit Improvement as follows:
Company Matching Contributions shall be as a
percent of Participants' Basic After-Tax
Contributions for that Match Year allocated
to:
If The Government Fund,
Profit Improvement The Diversified Fund, or The K-C
is The Fixed Income Fund Stock Fund
None 10% 25%
Less than 7% 10% 25%
7% but less than 11% 15% 30%
11% but less than 13% 20% 35%
13% but less than 15% 20% 40%
15% but less than 17% 20% 45%
17% or more 20% 50%
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Profit Improvement.
(a) General: For each of the Corporation's fiscal years,
the earnings after taxes per share of Corporation Stock
as reported or to be reported by the Corporation in its
annual report to its stockholders (herein called
"earnings per share") shall be ascertained by the
Committee and entered in its records. The Committee
shall then compute for each Match Year
(i) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the earnings
per share for the fiscal year immediately preceding
that fiscal year, and
(ii) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the simple
arithmetic average of the earnings per share for
the three fiscal years immediately preceding that
fiscal year,
and Profit Improvement for the Match Year shall be the
lower of the two percentages.
(b) Adjustments: In the event of stock splits, stock
dividends, changes in capital structure,
reorganizations, acquisitions, or any other event which
makes the Corporation's earnings per share for one year
not fairly comparable as determined by the Board, with
earnings per share for immediately preceding years, the
Board may make such adjustments thereto as it deems
necessary and desirable in accordance with sound
accounting practice.
4.3 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.4 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.5 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.5(a)(i) shall be determined in the
manner set forth in subsection 4.5(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.5(a)(i)
above.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXI
(As amended through March 31, 1993)
(Lexington Mill)
With respect to the Participating Unit under this Schedule,
consisting of all nonexempt salaried employees of the Lexington
Mill, the Plan shall apply with full force and effect except as
may be otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXII
(As amended through March 31, 1993)
(LaGrange Mill)
With respect to the Participating Unit under this Schedule,
consisting of all nonexempt salaried employees of the LaGrange
Mill, the Plan shall apply with full force and effect excpet as
may be otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXIII
(As amended through March 31, 1993)
(Ogden Mill)
With respect to the Participating Unit under this Schedule,
consisting of all nonexempt salaried employees of the Ogden Mill,
the Plan shall apply with full force and effect except as may be
otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXIV
(As amended through March 31, 1993)
(Spotswood Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Spotswood Mill who are
represented by the United Paperworkers International Union, AFL-
CIO, Local No. 1482, the Plan shall apply with full force and
effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXV
(As amended through March 31, 1993)
(Fullerton Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Fullerton Mill who are
represented by the Association of Western Pulp & Paperworkers,
Local No. 672, the Plan shall apply with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXVI
(As amended through May 24, 1994)
(Coosa Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Coosa Mill who are
represented by the United Paperworkers International Union, Locals
Nos. 692, 1693 and 1595; the United Association of Journeymen and
Apprentices of the Plumbing and Pipefitting Industry of the United
States and Canada, Local No. 91; Local Union No. 1629 of the
International Brotherhood of Electrical Workers; and the
International Association of Machinists and Aerospace Workers,
Local Lodge No. 985; and all hourly employees at Coosa Forest
Products-Woodlands who are represented by the United Paperworkers
International Union, Local No. 692, the Plan shall apply with full
force and effect except that Articles II and IV of this Schedule
shall apply in lieu of the same numbered Articles of the Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Stock and Cash Distribution: As defined in subsection
7.3(b).
(fff) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(ggg) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(hhh) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(iii) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(jjj) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(kkk) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(lll) Trustee: The trustee under the Trust.
(mmm) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(nnn) Valuation Date: The last day of each month.
(ooo) Withdrawal Year: As defined in Section 8.1.
(ppp) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.4, Company
Matching Contributions for each twelve calendar month period
beginning on April 1 of one year and ending March 31 of the
following year (herein called the "Match Year") shall be not
less than 10% nor more than 50% of Basic After-Tax
Contributions. Within such limits, Company Matching
Contributions for each Match Year shall depend upon the
allocation of Basic After-Tax Contributions by Participants
and upon Profit Improvement as follows:
Company Matching Contributions shall be as a
percent of Participants' Basic After-Tax
Contributions for that Match Year allocated
to:
If The Government Fund,
Profit Improvement The Diversified Fund, or The K-C
is The Fixed Income Fund Stock Fund
None 10% 25%
Less than 7% 10% 25%
7% but less than 11% 15% 30%
11% but less than 13% 20% 35%
13% but less than 15% 20% 40%
15% but less than 17% 20% 45%
17% or more 20% 50%
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Profit Improvement.
(a) General: For each of the Corporation's fiscal years,
the earnings after taxes per share of Corporation Stock
as reported or to be reported by the Corporation in its
annual report to its stockholders (herein called
"earnings per share") shall be ascertained by the
Committee and entered in its records. The Committee
shall then compute for each Match Year
(i) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the earnings
per share for the fiscal year immediately preceding
that fiscal year, and
(ii) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the simple
arithmetic average of the earnings per share for
the three fiscal years immediately preceding that
fiscal year,
and Profit Improvement for the Match Year shall be the
lower of the two percentages.
(b) Adjustments: In the event of stock splits, stock
dividends, changes in capital structure,
reorganizations, acquisitions, or any other event which
makes the Corporation's earnings per share for one year
not fairly comparable as determined by the Board, with
earnings per share for immediately preceding years, the
Board may make such adjustments thereto as it deems
necessary and desirable in accordance with sound
accounting practice.
4.3 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.4 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.5 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.5(a)(i) shall be determined in the
manner set forth in subsection 4.5(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.5(a)(i)
above.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXVII
(As amended through March 31, 1993)
(Karolton Envelope - Ohio)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Ohio Operations of
Karolton Envelope who are represented by the United Paperworkers
International Union, AFL-CIO, Local No. 1792, the Plan shall apply
with full force and effect.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXVIII
(As amended through May 24, 1994)
(Coosa Pines Golf Club, Incorporated)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of Coosa Pines Golf Club,
Incorporated, the Plan shall apply with full force and effect
except that Articles II and IV of this Schedule shall apply in
lieu of the same numbered Articles of the Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Stock and Cash Distribution: As defined in subsection
7.3(b).
(fff) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(ggg) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(hhh) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(iii) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(jjj) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(kkk) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(lll) Trustee: The trustee under the Trust.
(mmm) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(nnn) Valuation Date: The last day of each month.
(ooo) Withdrawal Year: As defined in Section 8.1.
(ppp) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.4, Company
Matching Contributions for each twelve calendar month period
beginning on April 1 of one year and ending March 31 of the
following year (herein called the "Match Year") shall be not
less than 10% nor more than 50% of Basic After-Tax
Contributions. Within such limits, Company Matching
Contributions for each Match Year shall depend upon the
allocation of Basic After-Tax Contributions by Participants
and upon Profit Improvement as follows:
Company Matching Contributions shall be as a
percent of Participants' Basic After-Tax
Contributions for that Match Year allocated
to:
If The Government Fund,
Profit Improvement The Diversified Fund, or The K-C
is The Fixed Income Fund Stock Fund
None 10% 25%
Less than 7% 10% 25%
7% but less than 11% 15% 30%
11% but less than 13% 20% 35%
13% but less than 15% 20% 40%
15% but less than 17% 20% 45%
17% or more 20% 50%
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Profit Improvement.
(a) General: For each of the Corporation's fiscal years,
the earnings after taxes per share of Corporation Stock
as reported or to be reported by the Corporation in its
annual report to its stockholders (herein called
"earnings per share") shall be ascertained by the
Committee and entered in its records. The Committee
shall then compute for each Match Year
(i) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the earnings
per share for the fiscal year immediately preceding
that fiscal year, and
(ii) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the simple
arithmetic average of the earnings per share for
the three fiscal years immediately preceding that
fiscal year,
and Profit Improvement for the Match Year shall be the
lower of the two percentages.
(b) Adjustments: In the event of stock splits, stock
dividends, changes in capital structure,
reorganizations, acquisitions, or any other event which
makes the Corporation's earnings per share for one year
not fairly comparable as determined by the Board, with
earnings per share for immediately preceding years, the
Board may make such adjustments thereto as it deems
necessary and desirable in accordance with sound
accounting practice.
4.3 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.4 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.5 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.5(a)(i) shall be determined in the
manner set forth in subsection 4.5(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.5(a)(i)
above.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXIX
(As amended through May 24, 1994)
(Coosa Forest Products - Goodwater, Roanoke, Nixburg and
Ashville)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Coosa Forest Products -
Goodwater, Roanoke, Nixburg and Ashville, the Plan shall apply
with full force and effect except that Articles II and IV of this
Schedule shall apply in lieu of the same numbered Articles of the
Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Stock and Cash Distribution: As defined in subsection
7.3(b).
(fff) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(ggg) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(hhh) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(iii) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(jjj) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(kkk) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(lll) Trustee: The trustee under the Trust.
(mmm) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(nnn) Valuation Date: The last day of each month.
(ooo) Withdrawal Year: As defined in Section 8.1.
(ppp) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.4, Company
Matching Contributions for each twelve calendar month period
beginning on April 1 of one year and ending March 31 of the
following year (herein called the "Match Year") shall be not
less than 10% nor more than 50% of Basic After-Tax
Contributions. Within such limits, Company Matching
Contributions for each Match Year shall depend upon the
allocation of Basic After-Tax Contributions by Participants
and upon Profit Improvement as follows:
Company Matching Contributions shall be as a
percent of Participants' Basic After-Tax
Contributions for that Match Year allocated
to:
If The Government Fund,
Profit Improvement The Diversified Fund, or The K-C
is The Fixed Income Fund Stock Fund
None 10% 25%
Less than 7% 10% 25%
7% but less than 11% 15% 30%
11% but less than 13% 20% 35%
13% but less than 15% 20% 40%
15% but less than 17% 20% 45%
17% or more 20% 50%
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Profit Improvement.
(a) General: For each of the Corporation's fiscal years,
the earnings after taxes per share of Corporation Stock
as reported or to be reported by the Corporation in its
annual report to its stockholders (herein called
"earnings per share") shall be ascertained by the
Committee and entered in its records. The Committee
shall then compute for each Match Year
(i) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the earnings
per share for the fiscal year immediately preceding
that fiscal year, and
(ii) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the simple
arithmetic average of the earnings per share for
the three fiscal years immediately preceding that
fiscal year,
and Profit Improvement for the Match Year shall be the
lower of the two percentages.
(b) Adjustments: In the event of stock splits, stock
dividends, changes in capital structure,
reorganizations, acquisitions, or any other event which
makes the Corporation's earnings per share for one year
not fairly comparable as determined by the Board, with
earnings per share for immediately preceding years, the
Board may make such adjustments thereto as it deems
necessary and desirable in accordance with sound
accounting practice.
4.3 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.4 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.5 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.5(a)(i) shall be determined in the
manner set forth in subsection 4.5(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.5(a)(i)
above.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXX
(As amended through May 24, 1994)
(Coosa Forest Products - Mountain Shadows)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Coosa Forest Products -
Mountain Shadows, the Plan shall apply with full force and effect
except that Articles II and IV of this Schedule shall apply in
lieu of the same numbered Articles of the Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Stock and Cash Distribution: As defined in subsection
7.3(b).
(fff) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(ggg) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(hhh) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(iii) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(jjj) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(kkk) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(lll) Trustee: The trustee under the Trust.
(mmm) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(nnn) Valuation Date: The last day of each month.
(ooo) Withdrawal Year: As defined in Section 8.1.
(ppp) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.4, Company
Matching Contributions for each twelve calendar month period
beginning on April 1 of one year and ending March 31 of the
following year (herein called the "Match Year") shall be not
less than 10% nor more than 50% of Basic After-Tax
Contributions. Within such limits, Company Matching
Contributions for each Match Year shall depend upon the
allocation of Basic After-Tax Contributions by Participants
and upon Profit Improvement as follows:
Company Matching Contributions shall be as a
percent of Participants' Basic After-Tax
Contributions for that Match Year allocated
to:
If The Government Fund,
Profit Improvement The Diversified Fund, or The K-C
is The Fixed Income Fund Stock Fund
None 10% 25%
Less than 7% 10% 25%
7% but less than 11% 15% 30%
11% but less than 13% 20% 35%
13% but less than 15% 20% 40%
15% but less than 17% 20% 45%
17% or more 20% 50%
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Profit Improvement.
(a) General: For each of the Corporation's fiscal years,
the earnings after taxes per share of Corporation Stock
as reported or to be reported by the Corporation in its
annual report to its stockholders (herein called
"earnings per share") shall be ascertained by the
Committee and entered in its records. The Committee
shall then compute for each Match Year
(i) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the earnings
per share for the fiscal year immediately preceding
that fiscal year, and
(ii) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the simple
arithmetic average of the earnings per share for
the three fiscal years immediately preceding that
fiscal year,
and Profit Improvement for the Match Year shall be the
lower of the two percentages.
(b) Adjustments: In the event of stock splits, stock
dividends, changes in capital structure,
reorganizations, acquisitions, or any other event which
makes the Corporation's earnings per share for one year
not fairly comparable as determined by the Board, with
earnings per share for immediately preceding years, the
Board may make such adjustments thereto as it deems
necessary and desirable in accordance with sound
accounting practice.
4.3 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.4 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.5 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.5(a)(i) shall be determined in the
manner set forth in subsection 4.5(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.5(a)(i)
above.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXXII
(As amended through March 31, 1993)
(Maumelle Facility)
With respect to the Participating Unit under this Schedule,
consisting of all nonexempt salaried employees of the Maumelle
Facility, the Plan shall apply with full force and effect except
as may be otherwise provided, from time to time, by this Schedule.
KIMBERLY-CLARK CORPORATION
HOURLY EMPLOYEES INCENTIVE INVESTMENT PLAN
SCHEDULE XXXIII
(As amended through May 24, 1994)
(Neenah Paper - Whiting Mill)
With respect to the Participating Unit under this Schedule,
consisting of all hourly employees of the Neenah Paper - Whiting
Mill, who are represented by the United Paperworkers International
Union, AFL-CIO, Local 370, the Plan shall apply with full force
and effect except that Articles II and IV of this Schedule shall
apply in lieu of the same numbered Articles of the Plan.
ARTICLE II
DEFINITIONS AND CONSTRUCTION
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(e) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(f) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(g) Board: The Board of Directors of the Corporation.
(h) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(i) Commissioner: The Commissioner of the Internal Revenue
Service.
(j) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(k) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(l) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(m) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(n) Corporation Stock: The common stock of the Corporation.
(o) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(p) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(q) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(r) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions
(i) he is an Employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service, or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection 2.1(r)(ii) shall be a period of 12
consecutive months, beginning on the Employee's
date of employment by the Corporation, a Subsidiary
or an Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an
Eligible Employee for all purposes hereunder during such
periods as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(s) Employee: A person employed by an Employer.
(t) Employee Accounts: Those Accounts specified in
subsections (u), (v), (w) and (x) of this Section 2.1.
(u) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(v) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(w) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(x) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(y) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(z) Employer Accounts: Those Accounts specified in
subsections (aa), (bb), (cc) and (dd) of this Section
2.1.
(aa) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(bb) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(cc) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(dd) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(ee) Entry Date: The first day of each month.
(ff) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(gg) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(hh) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ii) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(jj) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(kk) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(ll) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(mm) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature. The K-C Stock Fund
is intended to be an employee stock ownership plan, as
defined in section 4975 of the Code, and is designed to
invest primarily in qualifying employer securities, as
defined in section 409(l) of the Code.
(nn) Lump Sum Distribution: As defined in subsection 7.3(a).
(oo) Lump Sum Optional Distribution: As defined in
subsection 7.3(b).
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(fff) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(ggg) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(hhh) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(iii) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(jjj) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(kkk) Trustee: The trustee under the Trust.
(lll) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(mmm) Valuation Date: The last day of each month.
(nnn) Withdrawal Year: As defined in Section 8.1.
(ooo) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
[The following replaces section 2.1 effective September 1, 1994:]
2.1 Definitions. When the following words and phrases appear in
this Plan, they shall have the respective meanings set forth
below unless the context clearly indicates otherwise:
(a) Accounts: The accounts under the Plan to be maintained
for each Participant as provided in Section 6.2.
(b) Actual Contribution Percentage: A percentage which, for
a specified group of Eligible Employee for a Plan Year
shall be the average of the ratios (calculated
separately for each Eligible Employee in such group) of
(i) the amount of Unrestricted After-Tax Contributions,
Basic-After Tax Contributions, and Company Matching
Contributions remitted to the Trustee on behalf of
each Eligible Employee for such Plan Year, together
with qualified nonelective contributions treated as
Company Matching Contributions pursuant to Code
section 401(m) and regulations thereunder, to
(ii) the Eligible Employee's Total Compensation for such
Plan Year.
For purposes of determining the ratio of a Highly
Compensated Eligible Employee, the Unrestricted After-
Tax Contributions, Basic After-Tax Contributions,
Company Matching Contributions, and Total Compensation
of such Highly Compensated Eligible Employee shall
include the Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, Company Matching Contributions,
and Total Compensation of family members (as defined in
Code section 414(q)(6)(B)) of said Highly Compensated
Eligible Employee.
(c) Affiliated Employer: An Employer and any corporation
which is a member of a controlled group of corporations
(as defined in Code section 414(b)) which includes an
Employer; any trade or business (whether or not
incorporated) which is under common control (as defined
in Code section 414(c)) with an Employer; any
organization (whether or not incorporated) which is a
member of an affiliated service group (as defined in
Code section 414(m)) which includes an Employer; and any
other entity required to be aggregated with an Employer
pursuant to Code section 414(o).
(d) All Cash Distribution: As defined in 7.3(c).
(e) All Stock Distribution: As defined in subsection
7.3(a).
(f) Base Hourly Wages: An amount, as determined by the
Employer pursuant to Committee rule, which is that
portion of an Eligible Employee's Total Compensation
from an Employer which consists only of basic earnings
while a Participant. Base Hourly Wages shall be
determined before any elective salary reduction
contributions pursuant to Code Section 125 are deducted.
Notwithstanding the foregoing, the amount of any
Eligible Employee's compensation which is taken into
account for purposes of determining such Eligible
Employee's Base Hourly Wages under the Plan shall not
exceed $200,000 per year (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(g) Basic After-Tax Contributions: Employee contributions,
as defined in Code Section 401(m) and the regulations
thereunder, made through regular payroll deductions, and
on account of which a Company Matching Contribution was
made to this Plan on behalf of the Participant.
(h) Beneficiary: The person or persons last designated on
Timely Notice by a Participant, provided the named
person survives the Participant, and further provided:
(i) no designation of a person other than the
Participant's spouse shall be valid unless the
spouse has consented in writing, which written form
acknowledges the effect of the spouse's consent and
is witnessed by a notary public, to such
designation or the Participant is unmarried, and
(ii) if no such person is validly designated or if the
designated person predeceases the Participant, the
Beneficiary shall be the Participant's spouse, if
living, and if not, the Participant's estate.
(i) Board: The Board of Directors of the Corporation.
(j) Code: The Internal Revenue Code of 1986, as amended
from time to time.
(k) Commissioner: The Commissioner of the Internal Revenue
Service.
(l) Committee: The committee appointed to administer and
regulate the Plan as provided in Article IX.
(m) Company Matching Contributions: Amounts contributed
under the Plan by Employers as provided in Article IV.
(n) Contributions: Amounts deposited under the Plan by
Participants as provided in Article III.
(o) Corporation: Kimberly-Clark Corporation (a Delaware
corporation).
(p) Corporation Stock: The common stock of the Corporation.
(q) Current Market Value: The fair market value on any day
as determined by the Trustee in accordance with
generally accepted valuation principles applied on a
consistent basis.
(r) Day of Service: An Employee shall be credited with a
Day of Service for each calendar day commencing with the
date on which the Employee first performs an Hour of
Service until the Employee's Severance from Service
Date. If an Employee quits, is discharged, retires, or
dies, and such Employee does not incur a One-Year Period
of Severance, the Employee shall be credited with a Day
of Service for each calendar day elapsed from the
Employee's Severance from Service Date to the date on
which the Employee again completes an Hour of Service.
(s) Diversified Fund: An unsegregated fund to be primarily
invested in common and preferred stocks of corporations
other than the Corporation, and other issues convertible
into such common and preferred stocks, which, pending
such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(t) Eligible Employee: Any person who is in the employ of
an Employer during such periods as he meets all of the
following conditions:
(i) he is an employee on the regular payroll of an
Employer;
(ii) he has (a) at least one calendar month of
continuous Service or (b) has completed during a
computation period beginning on or after April 1,
1993, 365 consecutive Days of Service or has
completed during a computation period ending on or
prior to March 31, 1993, at least 1,000 Hours of
Service. A computation period for purposes of this
subsection shall be a period of 12 consecutive
months, beginning on the Employee's date of
employment by the Corporation, a Subsidiary or an
Equity Company or an anniversary thereof; and
(iii) he is in a Participating Unit.
Any leased employee (as defined in Code section 414(n))
shall not be considered an Eligible Employee under the
Plan. In addition, a person who formerly was an
Eligible Employee shall be treated as an Eligible
Employee for all purposes hereunder during such periods
as he meets all of the following conditions:
(iv) he is on the regular payroll of an Employer; and
(v) he is on temporary assignment to provide services
for a corporation, hereinafter referred to as the
"Affiliate," which is a member of a controlled
group of corporations, within the meaning of Code
section 414(b) as modified by Code section 415(h),
of which the Corporation is a member, and which is
not an Employer hereunder.
For purposes of this subsection, a person shall be
considered on temporary assignment only if his period of
service for an Affiliate is expected to be of brief
duration not to exceed 5 years and if he is expected to
resume services for an Employer upon the expiration of
the temporary assignment with the Affiliate.
(u) Employee: A person employed by an Employer.
(v) Employee Accounts: Those Accounts specified in
subsections (w), (x), (y) and (z) of Section 2.1.
(w) Employee Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to his
Contributions.
(x) Employee Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to his
Contributions.
(y) Employee Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to his
Contributions.
(z) Employee Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to his Contributions.
(aa) Employer: The Corporation and each Subsidiary which the
Board shall from time to time designate as an Employer
for purposes of the Plan and which shall adopt the Plan
and the Trust. A list of Employers is set forth in
Appendix A.
(bb) Employer Accounts: Those Accounts specified in
subsections (cc), (dd), (ee) and (ff) of Section 2.1.
(cc) Employer Diversified Account: That Account which
reflects that portion of a Participant's interest in the
Diversified Fund which is attributable to Company
Matching Contributions.
(dd) Employer Fixed Income Account: That Account which
reflects that portion of a Participant's interest in the
Fixed Income Fund which is attributable to Company
Matching Contributions.
(ee) Employer Government Account: That Account which
reflects that portion of a Participant's interest in the
Government Fund which is attributable to Company
Matching Contributions.
(ff) Employer Stock Account: That Account which reflects
that portion of a Participant's interest in the K-C
Stock Fund which is attributable to Company Matching
Contributions.
(gg) Entry Date: The first day of each month.
(hh) Equity Company: Any corporation, which is not the
Corporation or a Subsidiary, 33-1/3% or more of the
voting shares of which are owned directly or indirectly
by the Corporation.
(ii) ERISA: The Employee Retirement Income Security Act of
1974, as amended from time to time.
(jj) Fixed Income Fund: An unsegregated fund to be primarily
invested in fixed income investments and other
securities providing a fixed rate of return, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(kk) Government Fund: An unsegregated fund to be invested in
obligations issued or fully guaranteed as to the payment
of principal and interest by the United States of
America or any agency or instrumentality thereof, which,
pending such investment, may be invested in short-term
securities issued or guaranteed by the United States of
America or in other investments of a short-term nature.
(ll) Group Termination: The termination of employment of a
group of Eligible Employees resulting from the sale,
shutdown, discontinuance, abandonment or other
divestiture by an Employer of an entire division or
plant as determined by the Board.
(mm) Highly Compensated Eligible Employee: An Eligible
Employee who is described in Code section 414(q) and the
regulations thereunder. An Employer may make a uniform
election with respect to all plans of the Employer to
apply a calendar year calculation, as permitted by
regulations under Code section 414(q).
(nn) Hours of Service: Each hour for which an Employee is
directly or indirectly paid, or entitled to payment, by
an Employer for the performance of duties and for
reasons other than the performance of duties during the
applicable computation period. An Hour of Service shall
also include each hour for which back pay, irrespective
of mitigation of damages, has been either awarded or
agreed to by an Employer. Hours of Service shall be
credited to the Employee for the computation period or
periods in which the duties are performed or for the
period to which the award or agreement pertains,
whichever is applicable. Credit for Hours of Service
shall be given for periods of absence spent in military
service to the extent required by law. Credit for Hours
of Service may also be given for such other periods of
absence of whatever kind or nature as shall be
determined under uniform rules of the Committee.
Employment with a company which was not, at the time of
such employment, an Employer shall be considered as the
performance of duties for an Employer if such employment
was continuous until such company was acquired by,
merged with, or consolidated with an Employer and such
employment continued with an Employer following such
acquisition, merger or consolidation. Employment with a
Subsidiary that is not an Employer or with an Equity
Company shall be considered as performance of duties for
an Employer.
Hours of Service shall be calculated and credited in a
manner consistent with U.S. Department of Labor
regulation Section 2530.200b-2(b) and (c), and shall in
no event exclude any hours required to be credited under
U.S. Department of Labor regulation Section 2530.200b-
2(a).
For any period or periods for which adequate records are
not available to accurately determine the Employee's
Hours of Service, the following equivalency shall be
used:
190 Hours of Service for each month for which such
Employee would otherwise receive credit for at
least one Hour of Service.
Solely for purposes of determining whether an Employee
has incurred a one-year break-in-service, an Employee
who is absent from work:
(1) by reason of the pregnancy of the Employee;
(2) by reason of the birth of a child of the
Employee;
(3) by reason of a placement of a child with the
Employee in connection with the adoption of
such child by the Employee; or
(4) for purpose of caring for such child for a
period beginning immediately following such
birth or placement,
shall be credited with certain Hours of Service which
would otherwise have been credited to the Employee if
not for such absence. The Hours of Service credited
hereunder by reason of such absence shall be credited
with respect to the Plan Year in which such absence
begins, if such credit is necessary to prevent the
Employee from incurring a one-year break-in-service in
such Plan Year, and otherwise with respect to the
Plan Year immediately following the Plan Year in which
such absence begins. In addition, the Hours of Service
credited with respect to such absence shall not exceed
501, and shall be credited only to the extent that the
Employee substantiates to the satisfaction of the
Committee that the Employee's absence, and the length
thereof, was for the reasons described in paragraphs
(1)-(4) above. Notwithstanding the foregoing, no Hours
of Service shall be credited pursuant to the three
immediately preceding sentences with respect to any
absence which commences before April 1, 1985.
(oo) K-C Stock Fund: An unsegregated fund to be invested in
Corporation Stock, which, pending such investment, may
be invested in short-term securities issued or
guaranteed by the United States of America or in other
investments of a short-term nature.
(pp) Matured Withdrawal Year: As defined in Section 8.2.
(qq) Months of Service: A calendar month any part of which
an Employee completes an Hour of Service. Except,
however, an Employee shall be credited with a Month of
Service for each month during the 12 month computation
period in which he has not incurred a One-Year Period of
Severance. An Employee shall be credited with a Month
of Service for each calendar month of absence during the
12 month computation period following the date on which
the Employee does not complete an Hour of Service for
any reason other than the Employee quits, is discharged,
retires or dies.
(rr) Named Fiduciary: The Retirement Trust Committee (the
members of which are designated by the Executive
Committee of the Board) shall be the Named Fiduciary of
the Plan as defined in ERISA.
(ss) One-Year Period of Severance: The applicable
computation period of 12 consecutive months during which
an Employee fails to accrue a Day of Service. Years of
Service and One-Year Periods of Severance shall be
measured on the same computation period.
An Employee shall not be deemed to have incurred a One-
Year Period of Severance if he completes an Hour of
Service within 12 months following his Severance from
Service Date.
(tt) Optional Annuity Distribution: As defined in subsection
7.3(c).
[The following replaces section 2.1(tt) effective January 1,
1995:]
(tt) Reserved.
(uu) Optional Installment Distribution: As defined in
subsection 7.3(d).
[The following replaces section 2.1(uu) effective January 1,
1995:]
(uu) Reserved.
(vv) Participant: An Eligible Employee who has validly
elected to participate under Section 3.1 hereof. He
remains a Participant until all of his Accounts have
been distributed pursuant to the Plan.
(ww) Participating Unit: A specific classification of
Employees of an Employer designated from time to time by
the Board as participating in this Plan. The
classifications so designated and the effective dates of
their participation are shown in Appendix A.
(xx) Plan Year: After December 31, 1993, a twelve calendar
month period beginning January 1 and ending the
following December 31. The period beginning on April 1,
1993, and ending December 31, 1993, shall constitute a
Plan Year. For the period prior to April 1, 1993, and
after March 31, 1970, each twelve calendar month periods
beginning on April 1 of one year and ending March 31 of
the following year. For the period prior to April 1,
1970, each of the periods set forth below shall
constitute a Plan Year under this Plan:
(i) August 1, 1967 to July 31, 1968
(ii) August 1, 1968 to July 31, 1969
(iii) August 1, 1969 to March 31, 1970.
For purposes of identification, each Plan Year is
designated in terms of the calendar year in which it
commences.
(yy) Profit Improvement: The principal determinant of the
percentage of Participants' Contributions which can be
matched by Company Matching Contributions as defined in
Section 4.2.
(zz) Regular Unrestricted After-Tax Contributions: After-
tax Contributions made through regular payroll
deductions under subsection 3.2(b).
(aaa) Service: Regular employment with the Corporation, a
Subsidiary or an Equity Company.
(bbb) Settlement Date: As defined in Section 7.2 for purposes
of Article VII. As defined in Section 8.4 for purposes
of Article VIII.
(ccc) Severance from Service Date: The earlier of:
(i) the date an Employee quits, is discharged, retires
or dies, or
(ii) the first anniversary of the date an Employee is
absent from Service for any reason other than a
quit, discharge, retirement, or death (e.g.
disability, leave of absence, or layoff, etc.)
(ddd) Special Unrestricted After-Tax Contributions: After-
tax Contributions which are made under subsection
3.2(c).
(eee) Stock and Cash Distribution: As defined in subsection
7.3(b).
(fff) Subsidiary: Any corporation, 50% or more of the voting
shares of which are owned directly or indirectly by the
Corporation, which is incorporated under the laws of one
of the States of the United States.
(ggg) Terminated Participant: A Participant who has
terminated his employment with an Employer with the
aggregate value of the Participant's Accounts exceeding
$3,500 and who has not elected to receive a distribution
under the Plan.
(hhh) Timely Notice: A notice in writing on forms, or by
electronic medium, prescribed by the Committee and filed
at such places and at such reasonable times as shall be
established by Committee rules.
(iii) Total and Permanent Disability: A condition arising out
of any injury or disease which the Committee determines
is permanent and prevents a Participant from engaging in
any occupation with the Corporation, a Subsidiary or an
Equity Company commensurate with his education, training
and experience, excluding:
(i) any condition incurred in military service (other
than temporary absence on military leave) if the
Participant does not return to active employment
with the Corporation, a Subsidiary or an Equity
Company at the end of his military service,
(ii) any condition incurred as a result of or incidental
to a felonious act perpetrated by the Participant,
and
(iii) any condition resulting from excessive use of
drugs or narcotics or from willful self-inflicted
injury.
(jjj) Total Compensation: An Eligible Employee's total
compensation as that term is defined in Code section
414(s). Total Compensation of any Eligible Employee
shall not exceed $200,000 (as automatically increased in
accordance with applicable regulations to reflect cost-
of-living adjustments).
(kkk) Trust: The Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan Trust pursuant to the trust
agreement provided for in Article V.
(lll) Trustee: The trustee under the Trust.
(mmm) Unrestricted After-Tax Contributions: Regular
Unrestricted After-Tax Contributions by Participants
under subsection 3.2(b) and Special Unrestricted After-
Tax Contributions by Participants under subsection
3.2(c), and any other Employee contribution, as defined
in Code Section 401(m) and the regulations thereunder,
on account of which no Company Matching Contribution was
made to this Plan.
(nnn) Valuation Date: The last day of each month.
(ooo) Withdrawal Year: As defined in Section 8.1.
(ppp) Year of Service: An Employee shall accrue a Year of
Service for each 365 Days of Service. If the total of
an Employee's Service exceeds his whole Years of
Service, then such Employee shall be credited with an
additional fraction of a Year of Service, the numerator
of which shall be the total number of his Days of
Service represented by such excess and the denominator
of which shall be 365. If the total of an Employee's
Service is less than one Year of Service, then such
Employee shall be credited with a fraction of a Year of
Service, the numerator of which shall be the total
number of his Days of Service and the denominator of
which shall be 365.
2.2 Construction. Where appearing in the Plan, the masculine
shall include the feminine and the plural shall include the
singular, unless the context clearly indicates otherwise.
The words "hereof," "herein," "hereunder" and other similar
compounds of the word "here" shall mean and refer to the
entire Plan and not to any particular Section or subsection.
ARTICLE IV
EMPLOYER CONTRIBUTIONS
4.1 Contribution Percentage. Subject to Section 4.4, Company
Matching Contributions for each twelve calendar month period
beginning on April 1 of one year and ending March 31 of the
following year (herein called the "Match Year") shall be not
less than 10% nor more than 50% of Basic After-Tax
Contributions. Within such limits, Company Matching
Contributions for each Match Year shall depend upon the
allocation of Basic After-Tax Contributions by Participants
and upon Profit Improvement as follows:
Company Matching Contributions shall be as a
percent of Participants' Basic After-Tax
Contributions for that Match Year allocated
to:
If The Government Fund,
Profit Improvement The Diversified Fund, or The K-C
is The Fixed Income Fund Stock Fund
None 10% 25%
Less than 7% 10% 25%
7% but less than 11% 15% 30%
11% but less than 13% 20% 35%
13% but less than 15% 20% 40%
15% but less than 17% 20% 45%
17% or more 20% 50%
No additional Company Matching Contributions shall be made by
reason of the reallocation of Participants' Accounts pursuant
to Section 3.7 and no Company Matching Contributions shall be
made with respect to Participants' Unrestricted After-Tax
Contributions.
4.2 Profit Improvement.
(a) General: For each of the Corporation's fiscal years,
the earnings after taxes per share of Corporation Stock
as reported or to be reported by the Corporation in its
annual report to its stockholders (herein called
"earnings per share") shall be ascertained by the
Committee and entered in its records. The Committee
shall then compute for each Match Year
(i) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the earnings
per share for the fiscal year immediately preceding
that fiscal year, and
(ii) the percentage by which, if any, the earnings per
share for the last fiscal year ending before the
commencement of the Match Year exceed the simple
arithmetic average of the earnings per share for
the three fiscal years immediately preceding that
fiscal year,
and Profit Improvement for the Match Year shall be the
lower of the two percentages.
(b) Adjustments: In the event of stock splits, stock
dividends, changes in capital structure,
reorganizations, acquisitions, or any other event which
makes the Corporation's earnings per share for one year
not fairly comparable as determined by the Board, with
earnings per share for immediately preceding years, the
Board may make such adjustments thereto as it deems
necessary and desirable in accordance with sound
accounting practice.
4.3 Allocation and Payment of Company Matching Contributions.
Company Matching Contributions shall be
(i) made out of current or accumulated earnings and
profits,
(ii) allocated exclusively to the K-C Stock Fund,
(iii) made to the Trustee as soon as practicable after
the end of the month in which the related
Contributions are withheld for payment to the
Trustee, and
(iv) made in cash, or at the sole option of the
Employer, in shares of Corporation Stock held in
the treasury, or both (but not in authorized but
unissued shares) in which event the amount of any
Company Matching Contribution made in Corporation
Stock shall be the Current Market Value thereof on
the date of delivery to the Trustee which, for the
purposes of the Plan, shall be considered as the
Trustee's cost of such shares except where Treasury
Regulations sections 1.402(a)-1(b)(2)(ii) and
54.4975-11(d)(1) require shares of Corporation
Stock acquired while the Plan is an employee stock
ownership plan to have a different cost in order to
satisfy their requirements.
Any forfeiture under the Plan shall be applied to reduce
Company Matching Contributions. A forfeiture shall be valued
at Current Market Value as of the Valuation Date on which the
forfeiture occurred.
4.4 Temporary Suspension of Company Matching Contributions. The
Board may order the suspension of all Company Matching
Contributions if in its opinion, the Corporation's
consolidated net income after taxes for the last fiscal year
is substantially below the Corporation's consolidated net
income after taxes for the immediately preceding fiscal year.
Any such determination by the Board shall be communicated to
all Eligible Employees and to all Participants reasonably in
advance of the first date for which such temporary suspension
is ordered.
Except when caused, as determined by the Board, by a change
in the capital structure of the Corporation which has the
effect that the regular cash dividend rate is not in fairness
comparable between successive quarters, any reduction of the
regular cash dividend rate payable on Corporation Stock for
any quarter as compared with the immediately preceding
quarter shall automatically result in the suspension of all
Company Matching Contributions for the first Plan Year
commencing after the quarter in which such reduction occurs.
4.5 Limitations on Company Matching Contributions, Basic After-
Tax Contributions, and Unrestricted After-Tax Contributions.
(a) Limitations on Actual Contribution Percentage.
(i) In any Plan Year in which the Actual Contribution
Percentage for the group of Highly Compensated
Eligible Employees would be more than the greater
of
(A) the Actual Contribution Percentage of all
other Eligible Employees multiplied by 1.25,
or
(B) the lesser of (I) 2 percent plus the Actual
Contribution Percentage of all other Eligible
Employees or (II) the Actual Contribution
Percentage of all other Eligible Employees
multiplied by 2.0,
the contribution rate under subsection 3.2(a) and
(b) and Section 4.1 of those Highly Compensated
Eligible Employees shall be reduced (in whole or
less than whole percentages) in descending order
until the Actual Contribution Percentage for the
group of Highly Compensated Eligible Employees is
not more than the greater of (A) or (B).
For purposes of this subsection, a person shall not
be considered to be an Eligible Employee until such
time as he or she could first have in effect a
valid election to participate in the Plan.
(ii) Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year (if any) in excess
of the amount permitted under (a)(i) of this
Section, together with the income or loss allocable
thereto, shall be distributed to the Participant
after the close of the Plan Year and within 12
months after the close of that Plan Year (and, if
practicable, no later than 2 1/2 months after the
close of the Plan Year in order to avoid any excise
tax imposed on the Employer for excess aggregate
contributions); provided, however, that an Employer
may make qualified nonelective or matching
contributions (as provided under Code section
401(m) and the regulations thereunder) to be
allocated only to the Accounts of Participants who
are not Highly Compensated Eligible Employees that,
in combination with Unrestricted After-Tax
Contributions, Basic After-Tax Contributions, and
Company Matching Contributions, satisfy the limit
set forth in (a)(i) above. The income or loss
allocable to an excess aggregate contribution under
subsection 4.5(a)(i) shall be determined in the
manner set forth in subsection 4.5(a)(iii).
(iii) The income or loss allocable to an excess aggregate
contribution shall be determined by multiplying the
income or loss allocable to a Participant's
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the Plan Year by a fraction, the
numerator of which is the Unrestricted After-Tax
Contributions, Basic After-Tax Contributions and
Company Matching Contributions made in excess of
the amount permitted in (a)(i) of this Section and
the denominator of which is the balance of the
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions and Company Matching
Contributions sections of the Participant's Account
on the last day of the Plan Year, together with any
Unrestricted After-Tax Contributions, Basic After-
Tax Contributions, and Company Matching
Contributions for the gap period described below,
but reduced by the income allocable to such
sections for the Plan Year and increased by the
loss allocable to such Sections for the Plan Year.
The income or loss allocable to an excess aggregate
contribution shall include the income or loss
allocable for the period between the end of the
Plan Year and the date of distribution (the "gap
period"). The income or loss allocable to an
excess aggregate contribution for the gap period
shall equal 10% of the income or loss allocable to
such contribution as determined above, multiplied
by the number of months that have elapsed since the
end of the Plan Year. For this purpose, a
distribution on or before the 15th of the month
shall be treated as made on the last day of the
preceding month, and a distribution made after the
15th of the month shall be treated as made on the
first day of the next month.
(b) Additional Limitation. Notwithstanding any provision of
the Plan to the contrary, the Committee may limit the
amount of Unrestricted After-Tax Contributions, Basic
After-Tax Contributions, and Company Matching
Contributions in a manner that prevents contributions in
excess of the limit set forth in subsection 4.5(a)(i)
above.
</TABLE>
EXHIBIT 23
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement No.
33-58402 of Kimberly-Clark Corporation on Form S-8 of our reports dated
April 5, 1994, incorporated by reference in this Transition Report on Form
11-K of the Kimberly-Clark Corporation Salaried Employees Incentive
Investment Plan and the Kimberly-Clark Corporation Hourly Employees
Incentive Investment Plan for the nine month period ended December 31,
1993.
/s/ Deloitte & Touche
DELOITTE & TOUCHE
Dallas, Texas
June 15, 1994
