<PAGE> 1
As filed with the Securities and Exchange Commission on October 7, 1994.
Registration No. 33-_________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------
FORM S-8
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
--------------------
TCA CABLE TV, INC.
(Exact name of registrant as specified in its charter)
Texas 75-1798185
(State or other jurisdiction of (I.R.S. employer identification number)
incorporation or organization)
3015 SSE Loop 323
Tyler, Texas 75713-0489
(Address of principal executive offices)
--------------------
TCA DEFERRED SAVINGS AND RETIREMENT PLAN
(Full title of the Plan)
--------------------
ROBERT M. ROGERS
3015 SSE Loop 323
Tyler, Texas 75713-0489
(Name and address of agent for service of agent for service)
(903) 595-3701
(Telephone number, including area code,
of agent for service)
--------------------
COPY TO:
JAMES S. RYAN, III
Jackson & Walker, L.L.P.
901 Main Street
Suite 6000
Dallas, Texas 75202
APPROXIMATE DATE OF PROPOSED COMMENCEMENT OF SALES PURSUANT TO THE PLAN:
From time to time after this Registration Statement becomes effective.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
===================================================================================================================================
Title of Amount Proposed Maximum Maximum
Securities to be Offering Price Offering Price Amount of Registration
to be Registered Registered Per Share (1) (1) Fee (1)
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.10 par value . . . . . . 200,000 shares $24.13 $4,826,000 $1664.14
===================================================================================================================================
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
Pursuant to Rule 457(c) and 457(h), the offering price and
registration fee are based on a price of $24.13 per share, which price
is an average of the high and low prices of the Common Stock on the
National Association of Securities Dealers Automated Quotation
National Market System on September 30, 1994.
In addition, pursuant to Rule 416 (c) under the Securities Act of 1933, this
registration statement also covers an indeterminate amount of interests to be
offered or sold pursuant to the employee benefit plan described herein.
<PAGE> 2
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE.
The following documents, which have been filed with the Commission by
the Company, are incorporated herein by reference and made a part hereof: (i)
Annual Report on Form 10-K for the fiscal year ended October 31, 1993; (ii)
Definitive Proxy Statement, dated March 3, 1994, relating to the Company's
Annual Meeting of Shareholders held on March 31, 1994; (iii) Quarterly Report
of the Company on Form 10-Q for the quarter ended January 31, 1994; (iv)
Quarterly Report of the Company on Form 10-Q for the quarter ended April 30,
1994; (v) Quarterly Report of the Company on Form 10-Q for the quarter ended
July 31, 1994; (vi) Annual Report on Form 11- K of TCA Cable TV, Inc. TCA
Deferred Savings and Retirement Plan for the year ended December 31, 1993; and
(vii) the description of the Company's Common Stock contained in the Company's
Registration Statement on Form S-1 (No. 2-75516) and Registration Statement on
Form 8-A (No. 2-88892), effective as of March 17, 1984.
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 and 15(d) of the Exchange Act subsequent to the date of this Registration
Statement and prior to the filing of a post-effective amendment which indicates
that all securities offered have been sold or which deregisters all securities
then remaining unsold, shall be deemed to be incorporated herein by reference
and to be a part hereof from the date of filing of such documents.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Registration Statement to the extent that a statement
contained herein or in any other subsequently filed document which also is or
is deemed to be incorporated by reference herein modifies or supersedes such
statement. Any such statement so modified or superseded shall not be deemed,
except as so modified or superseded, to constitute a part of this Registration
Statement.
ITEM 4. DESCRIPTION OF SECURITIES.
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL.
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Company is a Texas corporation and The Texas Business Corporation
Act ("TBCA") empowers a corporation organized thereunder to indemnify its
directors and officers or former directors and officers and to purchase
insurance with respect to liability arising out of their capacity or status as
directors and officers.
Reference is made to Article IX and Article VII, Section 8 of the
Company's Articles of Incorporation and Bylaws, respectively, which provide for
indemnification of officers and directors except as to certain circumstances
and except as provided by applicable law.
II-1
<PAGE> 3
Additionally, Article XIII of the Company's Articles of Incorporation
limits the liability of directors of the Company to the Company or its
stockholders (in their capacity as directors but not in their capacity as
officers) to the fullest extent permitted by the TBCA. The effect of such
Article XIII (based on the TBCA as of the date of this Prospectus) is that the
directors of the Company will not be personally liable for monetary damages for
breach of a director's fiduciary duty as a director, except for liability (i)
for any breach of the director's duty of loyalty to the Company or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) for a transaction
from which a director received an improper benefit whether or not the benefit
resulted from an action taken within the scope of the director's office, or
(iv) for an act related to an unlawful stock repurchase or payment of a
dividend.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been informed
that in the opinion of the Commission, such indemnification is against public
policy as expressed in the Securities Act and is therefore unenforceable.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED.
Not applicable.
ITEM 8. EXHIBITS.
The following is a list of all exhibits filed as a part of this
Registration Statement on Form S-8, including those incorporated herein by
reference.
Exhibit
Number Description of Exhibit
- ------- ----------------------
4(a) Articles of Incorporation of the Registrant.(1)
4(b) Articles of Amendment to Articles of Incorporation of the
Registrant.(2)
4(c) Articles of Amendment to Articles of Incorporation of the
Registrant.(2)
4(d) Bylaws of the Registrant.(1)
4(e) Form of Stock Certificate.(1)
5 Opinion of Jackson & Walker, L.L.P.(3)
15 None.
23(a) Consent of Coopers & Lybrand, L.L.P.(3)
23(b) Consent of Henry & Peters, P.C.(3)
23(c) Consent of Jackson & Walker, L.L.P.(4)
24 Power of Attorney (appearing on page II-5 of this
Registration Statement).(3)
II-2
<PAGE> 4
25 None.
27 None.
28 None.
99 TCA Deferred Savings and Retirement Plan.(3)
____________
(1) Previously filed as an exhibit to the Registrant's Registration
Statement on Form S-1, File No. 2-76516 dated as of March 16, 1982 and
incorporated herein by reference.
(2) Previously filed as an exhibit to the Registrant's Registration
Statement on Form S-8, File No. 33-21901 dated as of March 16, 1988,
and incorporated herein by reference.
(3) Filed herewith.
(4) Included in the opinion of Jackson & Walker, L.L.P., filed herewith.
In accordance with Form S-8 Item 8(b) the undersigned registrant has
undertaken to submit the TCA Deferred Savings and Retirement Plan, as amended
and restated (the "Plan") to the Internal Revenue Service ("IRS") and will make
all changes required by the IRS in order to qualify the Plan.
ITEM 9. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required
by section 10(a)(3) of the Securities Act of 1933;
(ii) To reflect in the prospectus any
facts or events arising after the effective date of the
registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in
the registration statement;
(iii) To include any material information
with respect to the plan of distribution not previously
disclosed in the registration statement or any material change
to such information in the registration statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not
apply if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934
that are incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act of 1933, each such post- effective amendment
shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at
that time shall be deemed to be the initial bona fide offering
thereof.
II-3
<PAGE> 5
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act of 1933, each
filing of the registrant's annual report pursuant to Section 13(a) or Section
15(d) of the Securities Exchange Act of 1934 (and, where applicable, each
filing of an employee benefit plan's annual report pursuant to Section 15(d) of
the Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
II-4
<PAGE> 6
SIGNATURES
THE REGISTRANT
Pursuant to the requirements of the Securities Act of 1933, as
amended, the Registrant certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-8 and has duly
caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Tyler, State of Texas on
the 22nd day of September, 1994.
TCA CABLE TV, INC.
(Registrant)
By: /s/ Jimmie F. Taylor
Jimmie F. Taylor, Vice President,
Chief Financial Officer and Treasurer
POWER OF ATTORNEY
Each person whose signature appears below authorizes Robert M. Rogers,
Fred R. Nichols and Jimmie F. Taylor, and each of them, each of whom may act
without joinder of the other, to execute in the name of each such person who is
then an officer or director of the Registrant, and to file any amendments to
this Registration Statement necessary or advisable to enable the Registrant to
comply with the Securities Act of 1933, as amended, and any rules, regulations
and requirements of the Commission, in respect thereof, in connection with the
registration of the securities which are the subject of this Registration
Statement, which amendments may make such changes in such Registration
Statement as such attorney may deem appropriate.
II-5
<PAGE> 7
Pursuant to the requirements of the Securities Act of 1933, as
amended, this Registration Statement has been signed by the following persons
in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
- --------- ----- ----
<S> <C> <C>
/s/ Robert M. Rogers Chairman of the Board, Chief September 21, 1994
- --------------------------- Executive Officer and Director
Robert M. Rogers (Principal Executive Officer)
/s/ Fred R. Nichols President, Chief Operating September 21, 1994
- --------------------------- Officer and Director
Fred R. Nichols
/s/ Wayne J. McKinney Director September 21, 1994
- ---------------------------
Wayne J. McKinney
/s/ Ben R. Fisch, M.D. Director September 21, 1994
- ---------------------------
Ben R. Fisch, M.D.
/s/ A.W. Riter, Jr. Director September 21, 1994
- ---------------------------
A. W. Riter, Jr.
/s/ James F. Ackerman Director September 21, 1994
- ---------------------------
James F. Ackerman
/s/ Kenneth S. Gunter Director September 21, 1994
- ---------------------------
Kenneth S. Gunter
/s/ Randall K. Rogers Director September 21, 1994
- ---------------------------
Randall K. Rogers
</TABLE>
II-6
<PAGE> 8
<TABLE>
<S> <C> <C>
/s/ Jimmie F. Taylor Vice President, Chief September 21, 1994
- --------------------------- Financial Officer and
Jimmie F. Taylor Treasurer (Principal
Accounting and Financial
Officer)
</TABLE>
II-7
<PAGE> 9
THE PLAN
Pursuant to the requirements of the Securities Act of 1933, the Plan
has duly caused this Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Tyler, State of Texas,
on the 22nd day of September, 1994.
TCA DEFERRED SAVINGS AND
RETIREMENT PLAN (the Plan)
By: TCA MANAGEMENT COMPANY
By: /s/ Jimmie F. Taylor
Jimmie F. Taylor, Trustee
II-8
<PAGE> 10
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Sequentially
Exhibit No. Exhibit Numbered Page
- ----------- ------- -------------
<S> <C> <C>
4(a) Articles of Incorporation of the Registrant.(1) . . . . . . . . . . . . .
4(b) Articles of Amendment to Articles of
Incorporation of the Registrant(2) . . . . . . . . . . . . . . . . . . .
4(c) Articles of Amendment to Articles of
Incorporation of the Registrant(2) . . . . . . . . . . . . . . . . . . .
4(d) Bylaws of the Registrant.(1) . . . . . . . . . . . . . . . . . . . . . .
4(e) Form of Stock Certificate. (1) . . . . . . . . . . . . . . . . . . . . .
5 Opinion of Jackson & Walker, L.L.P.(3) . . . . . . . . . . . . . . . . .
15 None . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
23(a) Consent of Coopers & Lybrand, L.L.P. (3) . . . . . . . . . . . . . . . .
23(b) Consent of Henry & Peters, P.C. (3) . . . . . . . . . . . . . . . . . .
23(c) Consent of Jackson & Walker, L.L.P..(4) . . . . . . . . . . . . . . . . .
24 Power of Attorney (appearing on page II-5 of this Registration
Statement)(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
25 None . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
27 None . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
28 None . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
99 TCA Deferred Savings and Retirement Plan(3) . . . . . . . . . . . . . . .
</TABLE>
_____________
(1) Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-1, File No. 2-76516 dated as
of March 16, 1982, and incorporated by reference herein.
(2) Previously filed as an Exhibit to the Registrant's
Registration Statement on Form S-8, File No. 33-21901 dated as
of May 16, 1988, and incorporated by reference herein.
(3) Filed herewith.
(4) Included in the opinion of Jackson & Walker, L.L.P., filed
herewith.
<PAGE> 1
EXHIBIT 5
OPINION OF JACKSON & WALKER, L.L.P.
<PAGE> 2
October 6, 1994
TCA Cable TV, Inc.
3015 SSE Loop 323
Tyler, Texas 75713-0489
Re: Registration Statement on Form S-8 of TCA Cable TV, Inc.
Gentlemen:
We are acting as counsel for TCA Cable TV, Inc., a Texas corporation
(the "Company"), in connection with the registration under the Securities Act
of 1933, as amended (the "Act"), of the offering and sale of up to 200,000
shares of the Company's Common Stock, par value $0.10 per share (the "Shares").
A Registration Statement on Form S-8 covering the offering and sale of the
Shares (the "Registration Statement") is expected to be filed with the
Securities and Exchange Commission on or about the date hereof.
In reaching the conclusions expressed in this opinion, we have
examined and relied upon the originals or certified copies of all documents,
certificates and instruments as we have deemed necessary to the opinions
expressed herein, including the Articles of Incorporation, as amended, and the
Bylaws of the Company. In making the foregoing examinations, we have assumed
the genuineness of all signatures on original documents, the authenticity of
all documents submitted to us as originals and the conformity to original
documents of all copies submitted to us.
Based solely upon the foregoing, subject to the comments hereinafter
stated, and limited in all respects to the laws of the State of Texas and the
federal laws of the United States of America, it is our opinion that the
Shares, when sold by the Plan in accordance with the terms of the Plan will be
validly issued, fully paid and nonassessable.
We hereby consent to the use of this opinion as an Exhibit to the
Registration Statement. In giving this consent, we do not admit that we come
within the category of persons whose consent is required under Section 7 of the
Act or the rules and regulations of the Commission promulgated thereunder.
Very truly yours,
/s/ Jackson & Walker, L.L.P.
<PAGE> 1
EXHIBIT 23(a)
CONSENT OF COOPERS & LYBRAND, L.L.P.
<PAGE> 2
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statement of TCA Cable TV, Inc. on Form S-8 of our report dated
January 7, 1994, on our audits of the consolidated financial
statements and schedules of the Company as of October 31, 1993 and
1992, and for the three years ended October 31, 1993, which report is
included in the Company's Annual Report on Form 10-K.
/s/ Coopers & Lybrand L.L.P.
Dallas, Texas
October 7, 1994
<PAGE> 1
EXHIBIT 23(b)
CONSENT OF HENRY & PETERS, P.C.
<PAGE> 2
CONSENT OF HENRY & PETERS, P.C.
We consent to the incorporation by reference in the registration
statement on Form S-8 of our report dated May 17, 1994, on our audits
of the statements of net assets available and changes in net assets as
of and for the years ending December 31, 1993 and 1992 of TCA Deferred
Savings and Retirement Plan, which report is included in the Company's
Annual Report on Form 11-K for the year ended December 31, 1993.
/s/ Henry & Peters, P.C.
Tyler, Texas
October 7, 1994
<PAGE> 1
EXHIBIT 99
TCA DEFERRED SAVINGS AND RETIREMENT PLAN
<PAGE> 2
TCA DEFERRED SAVINGS AND RETIREMENT PLAN
as amended and restated
effective January 1, 1993
<PAGE> 3
PREAMBLE
The purpose of this Plan and Trust is to provide, in accordance with its
provisions, a defined contribution plan providing retirement and other
related benefits for those Employees of the Employer who are eligible
to participate hereunder. This document is a complete amendment and
restatement of the TCA Deferred Savings and Retirement Plan, which was
originally effective as of September 1, 1983.
It is intended that the Plan qualify for approval under Sections 401 and
410 through 417 of the Internal Revenue Code. It is intended that the Trust
qualify for approval under Section 501 of the Code. It is further intended
that the Plan comply with the provisions of the Employee Retirement Income
Security Act of 1974 (ERISA). In case of any ambiguity in the Plan's language,
it will be interpreted to accomplish the Plan's intent of qualifying under
the Code and complying with ERISA.
This Plan and Trust is exclusively for the benefit of the eligible
Employees and their Beneficiaries. Neither the Employer, the Plan
Administrator nor the Trustee will apply or interpret the terms of the Plan in
any manner that permits discrimination in favor of Highly Compensated
Employees. All Employees under similar circumstances will be treated alike.
The undersigned Employer and Trustees hereby adopt this restatement of the TCA
Deferred Savings and Retirement Plan to be effective as of January 1, 1993.
<PAGE> 4
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE NO.
<S> <C>
ARTICLE 1 - DEFINITIONS 1-1
ARTICLE 2 - PARTICIPATION 2-1
ARTICLE 3 - PARTICIPANT ACCOUNTS 3-1
ARTICLE 4 - ACCOUNTING AND VALUATION 4-1
ARTICLE 5 - RETIREMENT BENEFITS 5-1
ARTICLE 6 - DEATH BENEFIT 6-1
ARTICLE 7 - LIMITATIONS ON BENEFITS 7-1
ARTICLE 8 - MISCELLANEOUS 8-1
ARTICLE 9 - ADMINISTRATION 9-1
ARTICLE 10 - AMENDMENT OR TERMINATION OF PLAN 10-1
ARTICLE 11 - TRUSTEE AND TRUST FUND 11-1
</TABLE>
<PAGE> 5
ARTICLE 1
DEFINITIONS
As used in this document, unless otherwise defined or required by the context,
the following terms have the meanings set forth in this Article 1. Some of the
terms used in this document are not defined in Article 1, but for convenience
are defined as they are introduced in the text.
1.01 Account
Account means a separate account maintained for each Participant
reflecting applicable contributions, applicable forfeitures, investment
income (loss) allocated to the account and distributions.
1.02 Accounting Date, Valuation Date
The terms Accounting Date and Valuation Date are used interchangeably and
mean the last day of each Accounting Period and any other days within the
Accounting Period upon which, consistent with established methods and
guidelines, the Plan Administrator applies the accounting procedures
specified in Section 4.02.
1.03 Accounting Period, Valuation Period
The terms Accounting Period and Valuation Period are used interchangeably
and mean each of the 3-month periods which end on March 31st, June 30th,
September 30th and December 31st.
1.04 Accrued Benefit
A Participant's Accrued Benefit means the total value, as of a given
date, of his Accounts determined as of the Valuation Date immediately
preceding the date of determination plus any other amounts withheld from
the Participant's Compensation subsequent to such Valuation Date pursuant
to a Payroll Withholding Agreement. A Participant's Accrued Benefit will
not be reduced solely on account of any increase in such Participant's
age or service or on account of an amendment to the Plan.
A Participant's Vested Accrued Benefit is equal to his Vested Percentage
of that portion of his Accrued Benefit which is subject to the Vesting
Schedule plus 100% of the remaining portion of his Accrued Benefit.
1.05 Beneficiary
Beneficiary means the person, persons, trust or other entity who is
designated to receive any amount payable upon the death of a Participant.
1.06 Cash-Out Distribution
Cash-Out Distribution means, as described in Article 5, a distribution to
a Participant upon termination of employment of his Vested Accrued
Benefit.
1.07 Code and ERISA
Code means the Internal Revenue Code of 1986, as it may be amended from
time to time, and all regulations issued thereunder. Reference to a
section of the Code includes that section and any comparable section or
sections of any future legislation that amends, supplements or supersedes
such section and any regulations issued thereunder.
ERISA means Public Law No. 93-406, the Employee Retirement Income
Security Act of 1974, as it may be amended from time to time, and all
regulations issued thereunder. Reference to a section of ERISA includes
that section and any comparable section or sections of any future
legislation that amends, supplements or supersedes such section and any
regulations issued thereunder.
1-1
<PAGE> 6
1.08 Compensation
Except where otherwise specifically provided in this Plan, Compensation
means Aggregate Compensation as defined in Section 7.03(a).
Compensation also includes any amounts contributed by the Employer or any
Related Employer on behalf of any Employee pursuant to a salary reduction
agreement which are not includable in the gross income of the Employee
due to Code Section 125, 402(a)(8), 402(h) or 403(b).
Notwithstanding the foregoing, for all purposes under this Plan,
Compensation in excess of the Statutory Compensation Limit will be
disregarded. For purposes of applying this compensation limit, a Family
Member of a Highly Compensated Employee is subject to the single
aggregate compensation limit imposed on the Highly Compensated Employee
if the Family Member is either the Employee's spouse or is a lineal
descendant who has not attained the age of 19 by the end of the Plan
Year.
Statutory Compensation Limit means $150,000 ($200,000 for Plan Years
beginning before 1994), as adjusted in accordance with Code Section
401(a)(17)(B).
1.09 Effective Date
The Effective Date of the Plan is September 1, 1983.
Except as specified elsewhere in this document, the effective date of
this restatement of the Plan is January 1, 1993.
Sections 1.12, 1.18, 1.32, 1.33, 1.36, and Article 7 are effective
January 1, 1987. Section 4.05 is effective January 1, 1987.
1.10 Eligible Employee Classification
An Eligible Employee Classification is a classification of Employees, the
members of which are eligible to participate in the Plan. The Plan
covers all employee classifications except Leased Employees.
1.11 Eligible Participant
An Eligible Participant is a Participant who, in accordance with the
provisions of Article 3, is eligible to share in the allocation of a
contribution for a given Contribution Period.
1.12 Employee
(a) In General
An Employee is any person who is employed by the Employer or a
Participating Employer.
(b) Leased Employee
A Leased Employee means any person who, pursuant to an agreement
between the Employer or any Related Employer ("Recipient Employer")
and any other person ("leasing organization"), has performed services
for the Recipient Employer on a substantially full-time basis for a
period of at least one year and such services are of a type
historically performed by employees in the business field of the
Recipient Employer.
Any Leased Employee will be treated as an Employee of the Recipient
Employer; however, contributions or benefits provided by the leasing
organization which are attributable to the services performed for the
Recipient Employer will be treated as provided by the Recipient
Employer. If all Leased Employees constitute less than 20% of the
Employer's non-highly-compensated work force within the meaning of
Code Section 414(n)(1)(C)(ii), then the preceding sentence will not
apply to any Leased Employee if such Employee is covered by a money
purchase pension plan ("Safe Harbor Plan") which provides: (1) a
nonintegrated employer contribution rate of at least 10% of
compensation, (2) immediate
1-2
<PAGE> 7
participation, and (3) full and immediate vesting.
Years of Service for purposes of eligibility to participate in the
Plan and Years of Service for purposes of determining a Participant's
Vested Percentage include service by an Employee as a Leased
Employee.
1.13 Employer
The Employer and Plan Sponsor is TCA Management Company. A Participating
Employer is any organization which has adopted this Plan and Trust in
accordance with Section 8.07.
The term Predecessor Employer means any prior employer to which the
Employer is the successor, including any Predecessor Employer for which
the Employer maintains the obligations of a Predecessor Plan established
by the Predecessor Employer. Service with a Predecessor Employer will be
included as Service with the Employer for all purposes under this Plan.
1.14 Employment Commencement Date
The date an Employee first performs an Hour of Service for the Employer
is his Employment Commencement Date.
1.15 Entry Date
Entry Date means the first day of the month which next follows the date
upon which the eligibility requirements are met.
1.16 Fiscal Year
Fiscal Year means the taxable year of the Plan Sponsor. The Fiscal Year
of the Plan Sponsor is the 12 month period beginning November 1 and
ending October 31.
1.17 Forfeiture
The term Forfeiture refers to that portion, if any, of a Participant's
Accrued Benefit which is in excess of his Vested Accrued Benefit
following the termination of the Participant's employment.
A Forfeiture is considered to occur as of the earlier of (a) the date of
the occurrence of the fifth of 5 consecutive One Year Breaks-in-Service
or (b) the date a Cash-Out Distribution occurs in accordance with the
provisions of Article 5.
1.18 Highly Compensated Definitions
(a) Compensation
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus amounts contributed
by the Employer pursuant to a salary reduction agreement which are
excludable from the gross income of the Employee under Code Section
125, 402(a)(8), 402(h) or 403(b). Compensation in excess of the
Statutory Compensation Limit will be disregarded.
(b) Determination Year
Determination Year means the Plan Year for which the determination of
who is Highly Compensated is being made.
(c) Family Member
Family Member means an Employee who is the spouse, a lineal ascendant
or descendant, or the spouse of a lineal ascendant or descendant of:
-- a 5-percent owner (within the meaning of Code Section 416(i)) of
the Employer or any
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Related Employer who is an active or former Employee; or
-- a Highly Compensated Employee who is one of the 10 most highly
compensated employees ranked on the basis of Compensation paid by
the Employer during the Determination Year or the Lookback Year.
For purposes of this Section, the Family Member and the Highly
Compensated Employee will be considered one Employee. A Family
Member's Compensation and benefits will be aggregated with those of
the Highly Compensated Employee irrespective of whether the Family
Member would otherwise be treated as a Highly-Compensated Employee or
is in a category of Employees which may be excluded in determining
the number of Employees in the Top-Paid Group.
If an Employee is required to be aggregated as a member of more than
one family group, all eligible employees who are members of those
family groups which include that employee will be aggregated as one
family group.
For purposes of applying the compensation limit under Code Section
401(a)(17), a Family Member is subject to the single aggregate
compensation limit imposed on the Highly Compensated Employee if the
Family Member is either the Employee's spouse or is a lineal
descendant who has not attained the age of 19 by the end of the Plan
Year.
(d) Highly Compensated Employee
Highly Compensated Employee means any individual who is a Highly
Compensated Active Employee or a Highly Compensated Former Employee
within the meaning of Code Section 414(q) and the regulations
thereunder.
(e) Highly Compensated Active Employee
Highly Compensated Active Employee means any individual who during
the Determination Year or the Lookback Year:
(1) Was at any time a 5-percent Owner (within the meaning of Code
Section 416(i)) of the Employer or any Related Employer;
(2) Received Compensation from the Employer and all Related Employers
in excess of $75,000 (or any greater amount determined by
regulations issued by the Secretary of the Treasury under Code
Section 415(d));
(3) Received Compensation from the Employer and all Related Employers
in excess of $50,000 (or any greater amount determined by
regulations issued by the Secretary of the Treasury under Code
Section 415(d)) and was in the Top-Paid Group of Employees; or
(4) Was an Officer of the Employer or any Related Employer (as that
term is defined in the regulations under Code Section 416(i)) and
received Compensation greater than 50% of the Defined Benefit
Dollar Limit described in Section 7.03(f) for the applicable
year. For this purpose, if no Officer received enough
Compensation to be a Highly Compensated Employee under the
preceding sentence, the highest-paid Officer will be treated as a
Highly Compensated Employee. The maximum number of Officers who
will be treated as Highly Compensated Active Employees under this
paragraph is equal to 10% of all Employees determined without
regard to statutory or other exclusions, subject to a minimum of
3 Employees and a maximum of 50 Employees.
No individual described in subparagraphs (2), (3) or (4) above will
be treated as a Highly Compensated Active Employee for the
Determination Year unless he (i) was a Highly
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<PAGE> 9
Compensated Active Employee for the Lookback Year (or would have
been except that he was not among the 100 most highly compensated
Employees of the Employer and all Related Employers for the Lookback
Year) or (ii) was among the 100 most highly compensated Employees of
the Employer and all Related Employers for the Determination Year.
(f) Highly Compensated Former Employee
Highly Compensated Former Employee means any Former Employee who had
a Separation Year (within the meaning of Treasury Regulation Section
1.414(q)-1T Q&A-5) and was a Highly Compensated Active Employee for
either the Separation Year or any Determination Year ending on or
after the Employee's 55th birthday.
(g) Highly Compensated Group
Highly Compensated Group means all Highly Compensated Employees.
(h) Lookback Year
Lookback Year means the 12-month period immediately preceding the
Determination Year.
(i) Non-Highly Compensated Employee
Non-Highly Compensated Employee means an Employee who is neither a
Highly Compensated Employee nor a Family Member.
(j) Non-Highly Compensated Group
Non-Highly Compensated Group means all Non-Highly Compensated
Employees.
(k) Top-Paid Group
Top-Paid Group means those individuals who are among the top 20
percent of Employees of the Employer and all Related Employers when
ranked on the basis of Compensation received during the year. In
determining the number of individuals in the Top-Paid Group (but not
the identity of those individuals), the following individuals may be
excluded:
(1) Employees who have not completed 6 months of Service by the end
of the year. For this purpose, an Employee who has completed One
Hour of Service in any calendar month will be credited with one
month of Service;
(2) Employees who normally work fewer than 17 1/2 hours per week;
(3) Employees who normally work fewer than 6 months during any year.
For this purpose, an Employee who has worked on one day of a
month is treated as having worked for the whole month;
(4) Employees who have not reached age 21 by the end of the year;
(5) Nonresident aliens who received no earned income (which
constitutes income from sources within the United States) within
the year from the Employer or any Related Employer; and
(6) Employees covered by a collective bargaining agreement negotiated
in good faith between the employee representatives and the
Employer or a group of employers of which the Employer is a
member if (i) 90% or more of all employees of the Employer and
all Related Employers are covered by collective bargaining
agreements, and (ii) this Plan covers only Employees who are not
covered under a collective bargaining agreement.
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1.19 Hour of Service
An Hour of Service means:
(a) Each hour for which an Employee is paid, or entitled to payment, for
the performance of duties for the Employer. These hours will be
credited to the Employee for the computation period in which the
duties are performed;
(b) Each hour for which an Employee is paid, or entitled to payment, by
the Employer on account of a period of time during which no duties
are performed (irrespective of whether the employment relationship
has terminated) due to vacation, holiday, illness, incapacity
(including disability), layoff, jury duty, military duty or leave of
absence. No more than 501 Hours of Service will be credited under
this paragraph for any 12-month period. Hours under this paragraph
will be calculated and credited pursuant to Section 2530.200b-2 of
the Department of Labor Regulations which are incorporated herein by
this reference; and
(c) Each hour for which back pay, irrespective of mitigation of damages,
is either awarded or agreed to by the Employer. The same Hours of
Service will not be credited both under paragraphs (a) or (b), as the
case may be, and under this paragraph (c). These hours will be
credited to the Employee for the computation period or periods to
which the award or agreement pertains rather than the computation
period in which the award, agreement or payment is made.
Hours of Service for all Employees will be determined on the basis of
actual hours for which an Employee is paid or is entitled to payment.
Hours of Service will be credited for employment with any Related
Employer or any Predecessor Employer. Hours of Service will be credited
for any individual considered an employee under Code Section 414(n) or
414(o) and the regulations thereunder.
Solely for purposes of determining whether a One Year Break-in-Service
has occurred, a Participant who is absent from work on an authorized
Leave of Absence or by reason of the Participant's pregnancy, birth of
the Participant's child, placement of a child with the Participant in
connection with the adoption of such child, or for the purpose of caring
for such child for a period immediately following such birth or
placement, will receive credit for the Hours of Service which otherwise
would have been credited to the Participant but for such absence. The
Hours of Service credited under this paragraph will be credited in the
Plan Year in which the absence begins if such crediting is necessary to
prevent a One Year Break-in-Service in such Plan Year; otherwise, such
Hours of Service will be credited in the following Plan Year. The Hours
of Service credited under this paragraph are those which would normally
have been credited but for such absence; in any case in which the Plan
Administrator is unable to determine such hours normally credited, 8
Hours of Service per day will be credited. No more than 501 Hours of
Service will be credited under this paragraph for any 12-month period.
The Date of Severance is the second anniversary of the date on which the
absence begins. The period between the initial date of absence and the
first anniversary of the initial date of absence is deemed to be a period
of Service. The period between the first and second anniversaries of the
initial date of absence is neither a period of service nor a period of
severance.
1.20 Reserved
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1.21 Leave of Absence
An authorized Leave of Absence means a period of time of one year or less
granted to an Employee by the Employer due to illness, injury, temporary
reduction in work force, or other appropriate cause or due to military
service during which the Employee's reemployment rights are protected by
law, provided the Employee returns to the service of the Employer on or
before the expiration of such leave, or in the case of military service,
within the time his reemployment rights are so protected or within 60
days of his discharge from military service if no federal law is
applicable. All authorized Leaves of Absence are granted or denied by
the Employer in a uniform and nondiscriminatory manner, treating
Employees in similar circumstances in a like manner.
If the Participant does not return to active service with the Employer on
or prior to the expiration of his authorized Leave of Absence he will be
considered to have had a Date of Severance as of the earlier of the date
on which his authorized Leave of Absence expired, the first anniversary
of the last date he worked at least one hour as an Active Participant, or
the date on which he resigned or was discharged.
1.22 Reserved
1.23 Normal Retirement Age
A Participant's Normal Retirement Age is age 65.
1.24 Normal Retirement Date
A Participant's Normal Retirement Date is the date on which the
Participant attains Normal Retirement Age.
1.25 One Year Break-in-Service
One Year Break-in-Service means any 365-day period following a
Participant's Date of Termination in which an Employee does not complete
at least one Hour of Service.
1.26 Participant
The term Participant means an Employee or former Employee who is eligible
to participate in this Plan and who is or who may become eligible to
receive a benefit of any type from this Plan or whose Beneficiary may be
eligible to receive any such benefit.
(a) Active Participant means a Participant who is currently an
Employee in an Eligible Employee Classification.
(b) Disabled Participant means a Participant who has terminated his
employment with the Employer due to his Disability and who is
receiving or is entitled to receive benefits from the Plan.
(c) Retired Participant means a Participant who has terminated his
employment with the Employer after meeting the requirements for his
Normal Retirement Date and who is receiving or is entitled to receive
benefits from the Plan.
(d) Vested Terminated Participant means a Participant who has
terminated his employment with the Employer and who has a
nonforfeitable right to all or a portion of his or her Accrued
Benefit and who has not received a distribution of the value of his
or her Vested Accrued Benefit.
(e) Inactive Participant means a Participant who has (i) interrupted
his status as an Active Participant without becoming a Disabled,
Retired or Vested Terminated Participant and (ii) has a
non-forfeitable right to all or a portion of his Accrued Benefit and
has not received a complete distribution of his benefit.
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<PAGE> 12
(f) Former Participant means a Participant who has terminated his
employment with the Employer and who currently has no nonforfeitable
right to any portion of his or her Accrued Benefit.
1.27 Payroll Withholding Agreement
If a written Payroll Withholding Agreement is required pursuant to the
provisions of Article 3, then each Participant who elects to participate
in the Plan will file such agreement on or before the first day of the
payroll period for which the agreement is applicable (or at some other
time as specified by the Plan Administrator). Such agreement will be
effective for each payroll period thereafter until modified or amended.
The terms of such agreement will provide that the Participant agrees to
have the Employer withhold, each payroll period, any whole percentage of
his Compensation (or such other amount as allowed by the Plan
Administrator under rules applied on a uniform and nondiscriminatory
basis), not to exceed the limitations of Article 7. In consideration of
such agreement, the Employer periodically will make a contribution to the
Participant's proper Account(s) in an amount equal to the total amount by
which the Participant's Compensation from the Employer was reduced during
applicable payroll periods pursuant to the Payroll Withholding Agreement.
Notwithstanding the above, Payroll Withholding Agreements will be
governed by the following general guidelines:
(a) A Payroll Withholding Agreement will apply to each payroll period
during which an effective agreement is on file with the Employer.
Upon termination of employment, such agreement will become void.
(b) The Plan Administrator will establish and apply guidelines concerning
the frequency and timing of amendments or changes to Payroll
Withholding Agreements. Notwithstanding the foregoing, a Participant
may revoke his Payroll Withholding Agreement at any time and
discontinue all future withholding.
(c) The Plan Administrator may amend or revoke its Payroll Withholding
Agreement with any Participant at any time, if the Employer
determines that such revocation or amendment is necessary to insure
that a Participant's Annual Additions for any Plan Year will not
exceed the limitations of Article 7 or to insure that the
requirements of Sections 401(k) and 401(m) of the Code have been
satisfied with respect to the amount which may be withheld and
contributed on behalf of the Highly Compensated Group.
(d) Except as provided above, a Payroll Withholding Agreement may not be
revoked or amended by the Participant or the Employer.
1.28 Plan, Plan and Trust, Trust
The terms Plan, Plan and Trust and Trust mean TCA Deferred Savings and
Retirement Plan. The Plan Identification Number is 001. The Plan is a
profit sharing plan.
The term Predecessor Plan means any qualified plan previously established
and maintained by the Employer and to which this Plan is the successor.
1.29 Plan Administrator
The Plan Administrator is the Plan Committee.
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1.30 Plan Year
The Plan Year is the 12 month period beginning January 1 and ending
December 31. The Limitation Year coincides with the Plan Year.
1.31 Reserved
1.32 Qualified Election
Qualified Election means the designation of a specific Beneficiary other
than the Participant's Surviving Spouse. Such Qualified Election must be
in writing and must be consented to by the Participant's spouse. The
spouse's written consent to a Qualified Election must be witnessed by a
representative of the Plan Administrator or a notary public. Such
consent will not be required if the Participant establishes to the
satisfaction of the Plan Administrator that such written consent may not
be obtained because there is no spouse, the spouse cannot be located or
other circumstances that may be prescribed by Treasury Regulations. Any
consent necessary under this provision will be valid only with respect to
the spouse who signs the consent (or in the event of a deemed Qualified
Election, the designated spouse). Additionally, a revocation of a prior
Qualified Election may be made by a Participant without the consent of
the spouse at any time before the commencement of benefits; however, any
Qualified Election which follows such revocation must be in writing and
must be consented to by the Participant's spouse. The number of
Qualified Elections or revocations of such Qualified Elections will not
be limited.
1.33 Related Employer
The terms Related Employer and Affiliated Employer are used
interchangeably and mean any other corporation, association, company or
entity on or after the Effective Date which is, along with the Employer,
a member of a controlled group of corporations (as defined in Code
Section 414(b)), a group of trades or businesses which are under common
control (as defined in Code Section 414(c)), an affiliated service group
(as defined in Code Section 414(m)), or any organization or arrangement
required to be aggregated with the Employer by Treasury Regulations
issued under Code Section 414(o).
1.34 Required Beginning Date
A Participant's Required Beginning Date for the commencement of benefit
payments from the Plan is the April 1 immediately following:
-- the later of 1989 or the calendar year in which he attained age
70-1/2 if he attained age 70-1/2 after December 31, 1987;
-- the calendar year in which he attains age 70-1/2 if he is or was a
Five Percent Owner at any time during the Plan Year ending with or
within the calendar year in which he attains age 66-1/2 or any later
Plan Year; or
-- the later of the calendar year in which he attains age 70-1/2 or the
calendar year in which he retires for any other Participant.
1.35 Surviving Spouse
Surviving Spouse means a deceased Participant's spouse who was married to
the Participant on the Participant's date of death. The Plan
Administrator and the Trustee may rely conclusively on a Participant's
written statement of his marital status. Neither the Plan Administrator
nor the Trustee is required at any time to inquire into the validity of
any marriage, the effectiveness of a common-law relationship or the claim
of any alleged spouse which is inconsistent with the Participant's report
of his marital status and the identity of his spouse.
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1.36 Top-Heavy Definitions
(a) Aggregate Account
Aggregate Account means, with respect to each Participant, the value
of all accounts maintained on behalf of the Participant, whether
attributable to Employer or Employee contributions, used to determine
Top-Heavy Plan status under the provisions of a defined contribution
plan. A Participant's Aggregate Account as of the Determination Date
will be the sum of:
-- the balance of his Account(s) as of the most recent valuation
date occurring within a 12-month period ending on the
Determination Date (excluding any amounts attributable to
deductible voluntary employee contributions); plus
-- contributions that would be allocated as of a date not later than
the Determination Date, even though those amounts are not yet
made or required to be made; plus
-- any Plan Distributions made within the Plan Year that includes
the Determination Date or within the four preceding Plan Years.
(b) Aggregation Group
Aggregation Group means either a Required Aggregation Group or a
Permissive Aggregation Group as hereinafter determined.
(1) Required Aggregation Group
Each plan of the Employer in which a Key Employee is a
Participant, and each other plan of the Employer which enables
any plan in which a Key Employee participates to meet the
requirements of Code Section 401(a)(4) or 410, will be aggregated
and the resulting group will be known as a Required Aggregation
Group.
Each plan in the Required Aggregation Group will be considered a
Top-Heavy Plan if the Required Aggregation Group is a Top-Heavy
Group. No plan in the Required Aggregation Group will be
considered a Top-Heavy Plan if the Required Aggregation Group is
not a Top-Heavy Group.
(2) Permissive Aggregation Group
The Employer may also include any other plan not required to be
included in the Required Aggregation Group, provided the
resulting group (to be known as a Permissive Aggregation Group),
taken as a whole, would continue to satisfy the provisions of
Code Sections 401(a)(4) and 410.
Only a plan that is part of the Required Aggregation Group will
be considered a Top-Heavy Plan if the Permissive Aggregation
Group is a Top-Heavy Group. No plan in the Permissive
Aggregation Group will be considered a Top-Heavy Plan if the
Permissive Aggregation Group is not a Top-Heavy Group.
Only those plans of the Employer in which the Determination Dates
fall within the same calendar year will be aggregated in order to
determine whether the plans are Top-Heavy Plans.
(c) Determination Date
Determination Date means the last day of the preceding Plan Year, or,
in the case of the first Plan Year, the last day of the first Plan
Year.
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<PAGE> 15
(d) Key Employee
Key Employee means any Employee or former Employee (and his
Beneficiary) who, at any time during the Plan Year or any of the
preceding four Plan Years, was:
(1) A "Five Percent Owner" of the Employer. "Five Percent Owner"
means any person who owns (or is considered as owning within the
meaning of Code Section 318) more than 5% of the value of the
outstanding stock of the Employer or stock possessing more than
5% of the total combined voting power of all stock of the
Employer. If the Employer is not a corporation, Five Percent
Owner means any person who owns more than 5% of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, Related Employers will be treated as
separate Employers; or
(2) A "One Percent Owner" of the Employer having Compensation from
the Employer of more than $150,000. "One Percent Owner" means
any person who owns (or is considered as owning within the
meaning of Code Section 318) more than 1% of the value of the
outstanding stock of the Employer or stock possessing more than
1% of the total combined voting power of all stock of the
Employer. If the Employer is not a corporation, One Percent
Owner means any person who owns more than 1% of the capital or
profits interest in the Employer. In determining percentage
ownership hereunder, Related Employers will be treated as
separate Employers. However, in determining whether an
individual has Compensation of more than $150,000, Compensation
from each Related Employer will be taken into account.
(3) One of the 10 Employees having Compensation not less than the
Defined Contribution Dollar Limit (as defined in Section 7.03(j)
for the Plan Year) who owns (or is considered as owning within
the meaning of Code Section 318) both greater than 1/2% interest
and the largest interests in all Employers required to be
aggregated under Code Sections 414(b), (c), (m) and (o);
(4) An officer (within the meaning of the regulations under Code
Section 416) of the Employer having Compensation greater than 50%
of the Defined Benefit Dollar Limit as defined in Section 7.03(f)
for the Plan Year;
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus any amounts
contributed by the Employer pursuant to a salary reduction agreement
which are excludable from the gross income of the Employee under Code
Section 125, 402(a)(8), 402(h) or 403(b). Compensation in excess of
the Statutory Compensation Limit is disregarded.
(e) Non-Key Employee
Non-Key Employee means any Employee (and his Beneficiaries) who is
not a Key Employee.
(f) Plan Distributions
Plan distributions include distributions made before January 1, 1984,
and distributions under a terminated plan which, if it had not been
terminated, would have been required to be included in an aggregation
group. However, distributions made after the Valuation Date and
before the Determination Date are not included to the extent that
they are already included in the Participant's Single Sum Benefit as
of the Valuation Date.
With respect to "unrelated" rollovers and plan-to-plan transfers
(those which are both initiated by an employee and made from a plan
maintained by one employer to a plan maintained by another employer),
if such a rollover or plan-to-plan transfer is made from this Plan,
it will be considered as a distribution for purposes of this Section.
If such a rollover or plan-to-plan transfer is made to this Plan, it
will not be considered as
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<PAGE> 16
part of the Participant's Single Sum Benefit. However, an unrelated
rollover or plan-to-plan transfer accepted before January 1, 1984,
will be considered as part of the Participant's Single Sum Benefit.
With respect to "related" rollovers and plan-to-plan transfers (those
which are either not initiated by an employee or are made from one
plan to another plan maintained by the same employer), if such a
rollover or plan-to-plan transfer is made from this Plan, it will not
be considered as a distribution for purposes of this Section. If
such a rollover or plan-to-plan transfer is made to this Plan, it
will be considered as part of the Participant's Single Sum Benefit.
(g) Present Value of Accrued Benefit
In the case of the defined benefit plan, a Participant's Present
Value of Accrued Benefit, for Top-Heavy determination purposes, will
be determined using the following rules:
(1) The Present Value of Accrued Benefit will be determined as of the
most recent "Valuation Date" within a 12-month period ending on
the Determination Date.
(2) For the first Plan Year, the Present Value of Accrued Benefit
will be determined as if (A) the Participant terminated service
as of the Determination Date; or (B) the Participant terminated
service as of the Valuation Date, but taking into account the
estimated Present Value of Accrued Benefits as of the
Determination Date.
(3) For any other Plan Year, the Present Value of Accrued Benefit
will be determined as if the Participant terminated service as of
the Valuation Date.
(4) The Valuation Date must be the same date used for computing the
defined benefit plan minimum funding costs, regardless of whether
a calculation is performed that plan year.
(5) A Participant's Present Value of Accrued Benefit as of a
Determination Date will be the sum of:
-- the present value of his Accrued Benefit determined using the
actuarial assumptions which are specified below; plus
-- any Plan Distributions made within the Plan Year that
includes the Determination Date or within the four preceding
Plan Years; plus
-- any employee contributions, whether voluntary or mandatory.
However, amounts attributable to qualified voluntary employee
contributions, as defined in Code Section 219(e)(2) will not
be considered to be a part of the Participant's Present Value
of Accrued Benefit.
For purposes of this Section, the present value of a
Participant's Accrued Benefit will be equal to the greater of the
present value determined using the actuarial assumptions which
are specified for Actuarial Equivalent purposes or the present
value determined using the "Applicable Interest Rate." The
Applicable Interest Rate is the rate or rates that would be used
by the Pension Benefit Guaranty Corporation for a trusteed
single-employer plan to value a Participant's or Beneficiary's
benefit on the date of distribution (the "PBGC Rate"). If the
present value using the PBGC Rate exceeds $25,000, the Applicable
Interest Rate is 120% of the PBGC Rate. However, the use of 120%
of the PBGC Rate will never result in a present value less than
$25,000.
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<PAGE> 17
(6) Solely for the purpose of determining if this Plan (or any other
plan included in a Required Aggregation Group of which this Plan
is a part) is Top- Heavy, the Accrued Benefit of any Employee
other than a Key Employee will be determined under
(A) the method, if any, that uniformly applies for accrual
purposes under all plans maintained by the Employer or any
Related Employer, or
(B) if there is no such method, as if the benefit accrued no more
rapidly than the slowest accrual rate permitted under the
fractional accrual rate of Code Section 411(b)(1)(C).
(h) Single Sum Benefit
The Single Sum Benefit for any Participant in a defined benefit
pension plan will be equal to his Present Value of Accrued Benefit.
The Single Sum Benefit for any Participant in a defined contribution
plan will be equal to his Aggregate Account.
(i) Top-Heavy Group
Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the Single Sum Benefits of all Key Employees
under all plans included in the group exceeds 60% of a similar sum
determined for all Participants.
Super Top-Heavy Group means an Aggregation Group in which, as of the
Determination Date, the sum of (1) the Single Sum Benefits of all Key
Employees under all defined benefit plans included in the group, plus
(2) the Single Sum Benefit of all Key Employees under all defined
contribution plans included in the group exceeds 90% of a similar sum
determined for all Participants.
(j) Top-Heavy Plan
This Plan will be a Top-Heavy Plan for any Plan Year beginning after
December 31, 1983, in which, as of the Determination Date, the Single
Sum Benefits of all Key Employees exceed 60% of the Single Sum
Benefits of all Participants under this Plan.
This Plan will be a Super Top-Heavy Plan for any Plan Year beginning
after December 31, 1983, in which, as of the Determination Date, the
Single Sum Benefits of all Key Employees exceed 90% of the Single Sum
Benefits of all Participants under this Plan.
If any Participant is a Non-Key Employee for a given Plan Year, but
was a Key Employee for any prior Plan Year, the Participant's Single
Sum Benefit will not be taken into account for purposes of
determining whether this Plan is a Top-Heavy or Super Top-Heavy Plan
(or whether any Aggregation Group which includes this Plan is a
Top-Heavy or Super Top-Heavy Group).
If an individual has performed no services for the Employer at any
time during the 5-year period ending on the Determination Date, any
Single Sum Benefit of such individual will not be taken into account
for purposes of determining whether this Plan is a Top-Heavy or Super
Top-Heavy Plan (or whether any Aggregation Group which includes this
Plan is a Top-Heavy Group or Super Top-Heavy Group).
1.37 Trust Fund, Trust
These terms mean the total cash, securities, real property, insurance
contracts and any other property held by the Trustee.
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<PAGE> 18
1.38 Trustee
The Trustees are Robert M. Rogers, Fred R. Nichols, Jimmie F. Taylor, and
Jerry P. Yandell.
1.39 Vested Percentage
A Participant's Vested Percentage as of a given date will be that
percentage determined in accordance with the Vesting Schedule.
Notwithstanding the preceding, a Participant will be 100% vested upon
reaching the earlier of (a) his Normal Retirement Age or (b) the later of
the date upon which the Participant attains age 65 or reaches the 5th
anniversary of the date he commenced participation in the Plan.
1.40 Vesting Schedule
A Participant's Vested Percentage will be determined in accordance with
the following table:
<TABLE>
<CAPTION>
Years of Service Vested Percentage
---------------- -----------------
<S> <C>
Less than 3 Years 0%
3 Years 20%
4 Years 40%
5 Years 60%
6 Years 80%
7 Years or more 100%
</TABLE>
Notwithstanding the foregoing, in any Plan Year in which the Plan is
determined to be a Top-Heavy Plan, the following Vesting Schedule will
apply in lieu of the Vesting Schedule provided for above:
<TABLE>
<CAPTION>
Years of Service Vested Percentage
---------------- -----------------
<S> <C>
Less than 2 Years 0%
2 Years 20%
3 Years 40%
4 Years 60%
5 Years 80%
6 Years or more 100%
</TABLE>
If in any subsequent Plan Year the Plan ceases to be a Top-Heavy Plan,
the above Vesting Schedule will continue to apply unless the Employer
elects, by Written Resolution, to resume the Vesting Schedule specified
at the beginning of this Section. Any such resolution will be treated as
a Plan Amendment and be subject to the restrictions contained in Section
10.06.
1.41 Written Resolution
The terms Written Resolution and Written Consent are used interchangeably
and reflect decisions, authorizations, etc. by the Employer. A Written
Resolution will be evidenced by a resolution of the Board of Directors of
the Employer.
1.42 Year of Service
Years of Service are determined under the Elapsed Time Method. Under the
Elapsed Time Method, Years of Service are based upon an Employee's
Elapsed Time of employment irrespective of the number of hours actually
worked during such period; a Year of Service (including a fraction
thereof) will be credited for each completed 365 days of Elapsed Time
which need not be consecutive. The following terms are used in
determining Years of Service under the Elapsed Time Method:
(a) Date of Severance (Termination) - means the earlier of (A) the actual
date an Employee
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<PAGE> 19
resigns, is discharged, dies or retires, or (B) the first anniversary
of the date an Employee is absent from work (with or without pay) for
any other reason, e.g., disability, vacation, leave of absence,
layoff, etc.
(b) Elapsed Time - means the total period of service which has elapsed
between a Participant's Employment Commencement Date and Date of
Termination including Periods of Severance where a One Year
Break-in-Service does not occur.
(c) Employment Commencement Date - means the date an Employee first
performs one Hour of Service for the Employer.
(d) One Year Break-in-Service - means any 365-day period following an
Employee's Date of Termination as defined above in which the Employee
does not complete at least one Hour of Service.
(e) Period of Severance - is the time between the actual Date of
Severance as defined above and the subsequent date, if any, on which
the Employee performs an Hour of Service.
All periods of employment will be aggregated including Periods of
Severance unless there is a One Year Break-in-Service.
Years of Service for purposes of determining eligibility to participate
in the Plan for purposes of determining a Participant's Vested Percentage
include service with any organization which is a Related Employer with
respect to the Employer.
1-15
<PAGE> 20
ARTICLE 2
PARTICIPATION
2.01 Participation
An Employee will become eligible to participate in the Plan on the Entry
Date which next follows the completion of one Year of Service.
An Employee who is eligible to participate as of the Effective Date or as
of a given Entry Date will automatically become a Participant as of such
date.
2.02 Participation After Reemployment
An Employee who has satisfied all of the eligibility requirements but
terminates employment prior to his Entry Date will participate in the
Plan immediately upon returning to the employ of the Employer.
A Participant or Former Participant who has terminated employment will
participate as an Active Participant in the Plan immediately upon
returning to the employ of the Employer.
2.03 Change in Employment Classification
In the event a Participant becomes ineligible to participate because he
is no longer a member of an Eligible Employee Classification, the
Participant will participate immediately upon his return to an Eligible
Employee Classification.
In the event an Employee who is not a member of an Eligible Employee
Classification becomes a member of such a classification, such Employee
will begin to participate immediately if he has satisfied the eligibility
requirements which are specified in Section 2.01.
2-1
<PAGE> 21
ARTICLE 3
PARTICIPANT ACCOUNTS
3.01 Participant Account
Participant Account means the Account of a Participant reflecting
applicable contributions, investment income or loss allocated thereto and
distributions. A Participant's Participant Account is 100% vested at all
times.
(a) Participant Contributions
(1) Amount of Contribution
Each Participant will be entitled to make a Participant
Contribution each Contribution Period equal to a minimum of 1% of
the Participant's Compensation not to exceed 11% of the
Participant's Compensation. Such contribution will be designated
as a percentage of Compensation and will be equal to an even
multiple of 1% or such other amount as allowed by the Plan
Administrator.
(2) Payroll Withholding
All Participant Contributions will be made pursuant to a Payroll
Withholding Agreement in accordance with Section 1.27.
(3) Nondiscrimination Requirements
All Participant Contributions are Elective Contributions within
the meaning of Section 4.05(a) and must satisfy the
Nondiscrimination Requirements of Section 4.05.
(4) Excess Deferrals
The maximum amount of Participant Contribution which can be made
under the Plan on behalf of any Participant during any calendar
year will be limited to that amount which would not constitute an
Excess Deferral as defined in Section 4.05. The Plan
Administrator will distribute any Excess Deferral, together with
the income allocable to it, to the Participant no later than
April 15 of the calendar year immediately following the year of
the Excess Deferral. If a Participant notifies the Plan
Administrator before March 1 of any calendar year that Excess
Deferrals have been made on his account for the previous calendar
year by reason of participation in a Cash or Deferred Arrangement
maintained by another employer or employers, and if the
Participant requests that the Plan Administrator distribute a
specific amount to him on account of Excess Deferrals and
certifies that the requested amount is an Excess Deferral, the
Plan Administrator will designate the amount requested together
with the income allocable to it as a distribution of Excess
deferrals and distribute such amount no later than April 15 of
that calendar year. The amount of Excess Deferrals to be
distributed will be reduced by any Excess Contributions
previously distributed or recharacterized with respect to the
Plan Year beginning with or within the calendar year. The amount
of income allocable to the Excess Deferral will be determined as
described in Section 4.05.
(5) Timing of Deposits
The Employer will deposit all Participant Contributions no later
than 90 days after the date on which the amounts withheld would
otherwise have been paid to the Participant in cash.
The Contribution Period for Participant Contributions is each
month.
(b) Distributions
No distribution may be made from the Participant's Participant
Account or any account comprised of Matching Contributions or
Nonelective Contributions which are treated as Elective Contributions
in accordance with the provisions of Section 4.05(h) except under one
of the following circumstances:
3-1
<PAGE> 22
-- the Participant's retirement, death, disability or termination of
employment;
-- the avoidance or alleviation of a Financial Hardship;
-- the termination of this Plan without the establishment of a
successor plan within the meaning of Treasury Regulation Section
1.401(k)-1(d)(3);
-- the sale or other disposition by the Employer of at least 85
percent of the assets used by the Employer in a trade or business
to an unrelated corporation which does not maintain the plan, but
only if the Participant continues employment with the corporation
acquiring the assets and only if the Employer continues to
maintain this Plan; or
-- the sale or other disposition by the Employer of its interest in
a subsidiary to an unrelated entity which does not maintain the
plan, but only if the Participant continues employment with the
subsidiary and only if the Employer continues to maintain this
Plan.
This paragraph does not apply to distributions of Excess Deferrals,
Excess Contributions, or excess Annual Additions.
(c) Financial Hardship Withdrawals
A Participant may file with the Plan Administrator a written request
to withdraw, in order to avoid or alleviate a Financial Hardship, any
amount not to exceed that portion of his Participant Account which
represents the sum of
-- his total Participant Contributions made after 1988, and
-- his total Participant Contributions made before 1989 together
with the income earned before 1989 which is allocable to those
Contributions.
The Plan Administrator will allow Financial Hardship withdrawals only
if they are necessary to satisfy a Participant's immediate and heavy
financial need.
(1) Immediate and Heavy Financial Need
A withdrawal will be deemed to be made due to an immediate and
heavy financial need of the Participant if it is made because of:
-- Costs directly related to the purchase (excluding mortgage
payments) of a principal residence for the Participant;
-- Payment of tuition or educational fees for the next 12 months
of post-secondary education for the Participant, his spouse,
children or dependents (as defined in Code Section 152);
3-2
<PAGE> 23
(2) Necessary To Satisfy Financial Need
No withdrawal may exceed the amount necessary to satisfy the
Participant's immediate and heavy financial need. However, the
amount of an immediate and heavy financial need may include any
amounts necessary to pay any federal, state or local income taxes
or penalties reasonably anticipated to result from the
distribution. The Plan Administrator will allow the withdrawal
if it determines, after a full review of the Participant's
written request and evidence presented by the Participant showing
immediate and heavy financial need as well as the Participant's
lack of other reasonably available resources, that the withdrawal
is necessary to satisfy the need. No withdrawal will be treated
as necessary to the extent it can be satisfied from other
resources which are reasonably available to the Participant,
including those of the Participant's spouse and minor children.
A withdrawal will be treated as necessary to the extent the
Participant demonstrates to the satisfaction of the Plan
Administrator that the need cannot be relieved by any of the
following:
-- Reimbursement or compensation by insurance or otherwise;
-- Reasonable liquidation of assets to the extent the
liquidation would not itself cause an immediate and heavy
financial need;
-- Cessation of Participant Contributions or Employee
Contributions (as defined in Section 4.05(a)) or both under
any plan maintained by any employer;
-- Other distributions or nontaxable (at the time of the loan)
loans from plans maintained by any employer;
-- Borrowing from commercial sources on reasonable commercial
terms.
Unless the Plan Administrator has evidence to the contrary, it
may rely upon the Participant's written representation that the
need cannot be relieved by any of the foregoing.
(3) Safe Harbor
The Plan Administrator will not allow any withdrawal until the
Participant has obtained all distributions, other than hardship
distributions, and all nontaxable loans currently available to
the Participant under all plans maintained by the Employer. Upon
the withdrawal of any portion of a Participant's Participant
Account, the Participant will become ineligible for any Elective
Contribution to this Plan or any other plan maintained by the
Employer, or to make any contribution to this Plan or any other
plan maintained by the Employer until the first day of the first
Accounting Period which begins not less than 12 months following
the date of withdrawal. For this purpose the phrase "any other
plan maintained by the Employer" means all qualified and
nonqualified plans of deferred compensation maintained by the
Employer. The phrase includes stock option, stock purchase, or
similar plans, or a cash or deferred arrangement that is part of
a cafeteria plan within the meaning of Code Section 125. It does
not include the mandatory employee contribution portion of a
defined benefit plan, nor does it include a health or welfare
benefit plan (including one that is part of a cafeteria plan
within the meaning of Code Section 125). Furthermore, the
maximum amount of Participant Contributions which can be made
under the Plan on behalf of any Participant during the calendar
year which follows the calendar year in which the withdrawal was
made will be limited to the amount which would not be treated as
an Excess Deferral for that year reduced by the amount of
3-3
<PAGE> 24
Participant Contributions made on behalf of the Participant in
the calendar year of withdrawal.
3.02 Frozen After-tax Account
Frozen After-tax Account means the Account of a Participant reflecting
applicable contributions, investment income or loss allocated thereto and
distributions. Participant After-tax contributions are not allowed after
December 31, 1992. A Participant's Frozen After-tax Account is 100%
vested at all times.
A Participant may elect a hardship distribution from his Frozen After-tax
Account prior to his separation from service by filing written notice
with the Plan Administrator stating the amount necessary for the purpose
of paying expenses incurred for (a) the initial payment on the purchase
of the Participant's principal residence, (b) the edcuation of the
Participant's children beyond secondary school level, or (c) the
Participant's disability for a continuous period of at least 30 days.
3.03 Matching Account
Matching Account means the Account of a Participant reflecting applicable
contributions, forfeitures, investment income or loss allocated thereto
and distributions. A Participant's Matching Account is subject to the
Vesting Schedule.
(a) Matching Contributions
Each month, the Employer will, within the time prescribed by law for
making a deductible contribution, make a Matching Contribution to
each Participant's Matching Account in an amount which is determined
in accordance with this Section subject to the limitations of Article
7.
The amount of Matching Contribution to be made to a Participant's
Matching Account will be in accordance with the following schedule:
<TABLE>
<CAPTION>
Portion of
Participant Contribution Matching Contribution
Expressed as a Percentage of as a Percentage of the Participant's
Compensation which is Participant Contribution
------------------------------------------ ------------------------------------
Greater Than but Less Than or Equal To
------------ ---------------------
<S> <C> <C>
0% 2% 100%
2% 4% 50%
</TABLE>
All Matching Contributions are regarded as such within the meaning of
Section 4.05(a) and must satisfy the Nondiscrimination Requirements
of Section 4.05.
(b) Application of Forfeitures
Forfeitures from a Participant's Matching Account will be allocated
on a per capita basis to all Participants who are actively employed
as of the last day of the Plan Year in which the Forfeitures are
determined to occur.
(c) Withdrawals
A Participant who is 100% vested may elect a hardship distribution
from his Matching Account prior to his separation from service by
filing written notice with the Plan Administrator stating the amount
necessary for the purpose of paying expenses incurred for (a) the
initial payment on the purchase of the Participant's principal
residence, (b) the
3-4
<PAGE> 25
education of the Participant's children beyond secondary school level,
or (c) the Participant's disability for a continuous period of at
least 30 days.
A Participant who is less than 100% vested in his Matching Account
may not withdraw any portion of his Matching Account prior to the
time when benefits otherwise become payable in accordance with the
provisions of Article 5.
3.04 Discretionary Account
Discretionary Account means the Account of a Participant reflecting
applicable contributions, forfeitures, investment income or loss
allocated thereto and distributions. A Participant's Discretionary
Account is subject to the Vesting Schedule.
(a) Discretionary Contributions
Each Plan Year, the Employer may, within the time prescribed by law
for making a deductible contribution, make a Discretionary
Contribution to the Trust. For a given Plan Year, the total
Discretionary Contribution, if any, made by the Employer will be an
amount determined and authorized by the Employer for such Plan Year;
however, the Employer will not authorize Discretionary Contributions
at such times or in such amounts that the Plan, in operation,
discriminates in favor of Highly Compensated Employees.
The total Discretionary Contribution made by the Employer will be
allocated on a per capita basis to all Participants who are actively
employed as of the last day of the Plan Year.
(b) Application of Forfeitures
Forfeitures from a Participant's Discretionary Account will be
allocated on a per capita basis to all Participants who are actively
employed as of the last day of the Plan Year in which the Forfeitures
are determined to occur.
(c) Minimum Allocation for Top-Heavy Plan
Notwithstanding anything contained herein to the contrary, for any
Plan Year in which this Plan is determined to be Top-Heavy, a
Participant (including any Employee who is excluded from the Plan
because his Compensation is less than a stated amount) will be
entitled to a minimum allocation of Discretionary Contributions plus
any reallocated Forfeitures equal to 3% of the Participant's
Aggregate Compensation received during the Plan Year. This minimum
allocation will be provided to each Participant who is employed by
the Employer on the last day of the Plan Year whether or not he or
she is an otherwise Eligible Participant or fails to make any
mandatory Employee contribution to the Plan.
The percentage referred to in the preceding paragraph will not exceed
the percentage of Aggregate Compensation at which Discretionary
Contributions plus any reallocated Forfeitures are made or allocated
to the Key Employee for whom such percentage is the largest;
provided, however, this sentence will not apply if the Plan is
required to be included in an Aggregation Group to meet the
requirements of Code Sections 401(a)(4) or 410.
For any Plan Year, the minimum allocation required under this Section
will be reduced by any other contributions made by the Employer which
are taken into account in satisfying the requirements of Code Section
416(c)(2). However, neither Elective Contributions to a Cash or
Deferred Arrangement nor Matching Contributions for Non-Key Employees
will be taken into account in satisfying the requirements of Code
Section 416(c)(2).
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<PAGE> 26
(d) Withdrawals
A Participant who is 100% vested may elect a hardship distribution
from his Discretionary Account prior to his separation from service
by filing written notice with the Plan Administrator stating the
amount necessary for the purpose of paying expenses incurred for (a)
the initial payment on the purchase of the Participant's principal
residence, (b) the education of the Participant's children beyond
secondary school level, or (c) the Participant's disability for a
continuous period of at least 30 days.
A Participant who is less than 100% vested in his Discretionary
Account may not withdraw any portion of his Discretionary Account
prior to the time when benefits otherwise become payable in
accordance with the provisions of Article 5.
A Participant may elect a hardship distribution from his
Discretionary Account prior to his separation from service by filing
written notice with the Plan Administrator stating the amount
necessary for the purpose of paying expenses incurred for (a) the
initial payment on the purchase of the Participant's principal
residence, (b) the edcuation of the Participant's children beyond
secondary school level, or (c) the Participant's disability for a
continuous period of at least 30 days.
3-6
<PAGE> 27
ARTICLE 4
ACCOUNTING AND VALUATION
4.01 General Powers of the Plan Administrator
The Plan Administrator will have the power to establish rules and
guidelines, which will be applied on a uniform and non-discriminatory
basis, as it deems necessary, desirable or appropriate with regard to
accounting procedures and to the timing and method of contributions to
and/or withdrawals from the Plan.
4.02 Accounting Procedure
As of each Valuation Date, the Plan Administrator will determine from the
Trustee the fair market value of Trust assets and will, subject to the
provisions of this Article, determine the allocation of such value among
the Accounts of the Participants; in doing so, the Plan Administrator
will in the following order:
(a) Credit or charge, as appropriate, to the proper Accounts all
transfers, payments, forfeitures, withdrawals or other distributions
made to or from such Accounts during the current Accounting Period
that have not been previously credited or charged.
(b) Credit or charge, as applicable, each Account that is in existence on
the Valuation Date with its pro rata portion of the appreciation or
depreciation in the fair market value of the Trust Fund since the
prior Valuation Date. Such appreciation or depreciation will reflect
investment income, realized and unrealized gains and losses, other
investment transactions and expenses paid from the Trust Fund. Such
pro rata crediting or charging will be based upon the current amounts
of the Accounts as adjusted by the above step (a). The Plan
Administrator will establish the guidelines under which any
appreciation or depreciation is allocated to the various Accounts as
of the first Valuation Date for the Plan.
(c) Credit to the proper Accounts all contributions and reallocated
forfeitures which are to be credited for the current Accounting
Period.
4.03 Assumed Timing of Credits and Charges
Notwithstanding the provisions of Section 4.02, for purposes of
determining each Account's pro rata portion of the appreciation or
depreciation in the fair market value of the Trust Fund under Section
4.02(b), the following timing will be reflected:
-- Participant Account - Contributions to such Account are
assumed to occur as of the beginning of an Accounting Period.
-- Matching Account - Contributions to such Account are
assumed to occur as of the beginning of an Accounting Period.
4.04 Reserved
4-1
<PAGE> 28
4.05 Nondiscrimination Requirements
(a) Definitions Applicable to the Nondiscrimination Requirements
The following definitions apply to this Section:
(1) Aggregate Limit
With respect to a given Plan Year, Aggregate Limit means the
greater of the sum of ((A) + (B)) or the sum of ((C) + (D))
where:
(A) is equal to 125% of the greater of DP or CP;
(B) is equal to 2 percentage points plus the lesser of DP
or CP, not to exceed 2 times the lesser of DP or CP;
(C) is equal to 125% of the lesser of DP or CP;
(D) is equal to 2 percentage points plus the greater of DP
or CP, not to exceed 2 times the greater of DP or CP;
DP represents the Deferral Percentage for the Non-highly
Compensated Group eligible under the Cash or Deferred
Arrangement for the Plan Year; and
CP represents the Contribution Percentage for the Non-highly
Compensated Group eligible under the plan providing for the
Employee Contributions or Employer Matching Contributions
for the Plan Year beginning with or within the Plan Year of
the Cash or Deferred Arrangement.
(2) Cash or Deferred Arrangement (CODA)
A Cash or Deferred Election is any election (or modification of
an earlier election) by an Employee to have the Employer either:
-- provide an amount to the Employee in the form of cash or
some other taxable benefit that is not currently
available, or
-- contribute an amount to the Plan (or provide an accrual
or other benefit) thereby deferring receipt of
Compensation.
A Cash or Deferred Election will only be made with respect to an
amount that is not currently available to the Employee on the
date of election. Further, a Cash or Deferred Election will only
be made with respect to amounts that would have (but for the Cash
or Deferred Election) become currently available after the later
of the date on which the Employer adopts the Cash or Deferred
Arrangement or the date on which the arrangement first becomes
effective.
A Cash or Deferred Election does not include a one-time
irrevocable election upon the Employee's commencement of
employment or first becoming an Eligible Employee.
(3) Compensation
For purposes of this Section, Compensation means Aggregate
Compensation as defined in Section 7.03(a) plus amounts
contributed by the Employer pursuant to a salary reduction
agreement which are excludable from the gross income of the
Employee under Code Section 125, 402(a)(8), 402(h) or 403(b).
Compensation in excess of the Statutory Compensation Limit is
disregarded.
4-2
<PAGE> 29
The period used to determine an Employee's Compensation for a
Plan Year may be limited to that portion of the Plan Year in
which the Employee was an Eligible Employee, provided that this
method is applied uniformly to all Eligible Employees under the
Plan for the Plan Year.
(4) Contribution Percentage
Contribution Percentage means, for any specified group, the
average of the ratios calculated (to the nearest one-hundredth of
one percent) separately for each Participant in the group, of the
amount of Employee Contributions and Matching Contributions which
are made by or on behalf of each Participant for a Plan Year to
each Participant's Compensation for the Plan Year.
For purposes of determining the Contribution Percentage, each
Employee who is eligible under the terms of the Plan to make or
to have contributions made on his behalf is treated as a
Participant. The Contribution Percentage of an eligible Employee
who makes no Employee Contribution and receives no Matching
Contribution is zero.
For purposes of determining the Contribution Percentage of a
Participant who is a Highly Compensated Employee, the
Compensation of and all Employee Contributions and Matching
Contributions for the Participant include, in accordance with the
provisions of Section 4.05(d), the Compensation of and all
Employee Contributions and Matching Contributions for any Family
Member of the Participant.
The Contribution Percentage of a Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to
make Employee Contributions or receive an allocation of Matching
Contributions (including Elective Contributions and Nonelective
Contributions which are treated as Employee or Matching
Contributions for purposes of the Contribution Percentage Test)
allocated to his accounts under two or more plans which are
sponsored by the Employer will be determined as if the Employee
and Matching Contributions were made under a single plan. For
purposes of this paragraph, if a Highly Compensated Employee
participates in two or more such plans which have different Plan
Years, all plans ending with or within the same calendar year
will be treated as a single plan.
(5) Contribution Percentage Test
The Contribution Percentage Test is a test applied on a Plan Year
basis to determine whether a plan meets the requirements of Code
Section 401(m). The Contribution Percentage Test may be met by
either satisfying the General Contribution Percentage Test or the
Alternative Contribution Percentage Test.
The General Contribution Percentage Test is satisfied if the
Contribution Percentage for the Highly Compensated Group does not
exceed 125% of the Contribution Percentage for the Non-highly
Compensated Group.
The Alternative Contribution Percentage Test is satisfied if the
Contribution Percentage for the Highly Compensated Group does not
exceed the lesser of:
-- the Contribution Percentage for the Non-highly
Compensated Group plus 2 percentage points, or
-- the Contribution Percentage for the Non-highly
Compensated Group multiplied by 2.0.
If (i) one or more Highly Compensated Employees of the Employer
or any Related
4-3
<PAGE> 30
Employer are eligible to participate in both a Cash or Deferred
Arrangement and a plan which provides for Employee Contributions
or Matching Contributions, (ii) the Deferral Percentage for the
Highly Compensated Group does not satisfy the General Deferral
Percentage Test, and (iii) the Contribution Percentage for the
Highly Compensated Group does not satisfy the General
Contribution Percentage Test, then the Contribution Percentage
Test will be deemed to be satisfied only if the sum of the
Deferral Percentage and the Contribution Percentage for the
Highly Compensated Group does not exceed the Aggregate Limit.
The Plan will not fail to satisfy the Contribution Percentage
test merely because all of the Eligible Employees under the Plan
for a Plan Year are Highly Compensated Employees.
(6) Deferral Percentage
Deferral Percentage means, for any specified group, the average
of the ratios calculated (to the nearest one-hundredth of one
percent) separately for each Participant in the group, of the
amount of Elective Contributions which are made on behalf of each
Participant for a Plan Year to each Participant's Compensation
for the Plan Year.
For purposes of determining the Deferral Percentage, each
Employee who is eligible under the terms of the Plan to have
contributions made on his behalf is treated as a Participant.
The Deferral Percentage of an eligible Employee who makes no
Elective Contribution is zero.
For purposes of determining the Deferral Percentage of a
Participant who is a Highly Compensated Employee, the
Compensation of and Elective Contributions for the Participant
include, in accordance with the provisions of Section 4.05(d),
the Compensation and all Elective Contributions for any Family
Member of the Participant.
The Deferral Percentage of a Participant who is a Highly
Compensated Employee for the Plan Year and who is eligible to
have Elective Contributions (including Nonelective Contributions
or Matching Contributions which are treated as Elective
Contributions for purposes of the Deferral Percentage Test)
allocated to his accounts under two or more Cash or Deferred
Arrangements which are maintained by the Employer will be
determined as if the Elective Contributions were made under a
single Arrangement. For purposes of this paragraph, if a Highly
Compensated Employee participates in two or more Cash or Deferred
Arrangements which have different Plan Years, all Cash or
Deferred Arrangements ending with or within the same calendar
year will be treated as a single Arrangement.
(7) Deferral Percentage Test
The Deferral Percentage Test is a test applied on a Plan Year
basis to determine whether a plan meets the requirements of Code
Section 401(k). The Deferral Percentage Test may be met by
either satisfying the General Deferral Percentage Test or the
Alternative Deferral Percentage Test.
The General Deferral Percentage Test is satisfied if the Deferral
Percentage for the Highly Compensated Group does not exceed 125%
of the Deferral Percentage for the Non-highly Compensated Group.
The Alternative Deferral Percentage Test is satisfied if the
Deferral Percentage for the Highly Compensated Group does not
exceed the lesser of:
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<PAGE> 31
-- the Deferral Percentage for the Non-highly Compensated
Group plus 2 percentage points, or
-- the Deferral Percentage for the Non-highly Compensated
Group multiplied by 2.0.
If (i) one or more Highly Compensated Employees of the Employer
or any Related Employer are eligible to participate in both a
Cash or Deferred Arrangement and a plan which provides for
Employee Contributions or Matching Contributions, (ii) the
Deferral Percentage for the Highly Compensated Group does not
satisfy the General Deferral Percentage Test, and (iii) the
Contribution Percentage for the Highly Compensated Group does not
satisfy the General Contribution Percentage Test, then the
Deferral Percentage Test will be deemed to be satisfied only if
the sum of the Deferral Percentage and the Contribution
Percentage for the Highly Compensated Group does not exceed the
Aggregate Limit.
The Plan will not fail to satisfy the Deferral Percentage test
merely because all of the Eligible Employees under the Plan for a
Plan Year are Highly Compensated Employees.
(8) Elective Contribution
Elective Contribution means any contribution made by the Employer
to a Cash or Deferred Arrangement on behalf of and at the
election of an Employee. An Elective Contribution will be taken
into account for a given Plan Year only if:
-- The Elective Contribution is allocated to the
Participant's Account as of a date within the Plan Year
to which it relates;
-- The allocation is not contingent upon the Employee's
participation in the Plan or performance of services on
any date after the allocation date;
-- The Elective Contribution is actually paid to the trust
no later than 12 months after the end of the Plan Year to
which the Elective Contribution relates; and
-- The Elective Contribution relates to Compensation which
either (i) but for the Participant's election to defer,
would have been received by the Participant in the Plan
Year or (ii) is attributable to services performed by the
Participant in the Plan Year and, but for the
Participant's election to defer, would have been received
by the Participant within two and one-half months after
the close of the Plan Year.
Elective Contributions will be treated as Employer Contributions
for purposes of Code Sections 401(a), 401(k), 402(a), 404, 409,
411, 412, 415, 416, and 417.
(9) Elective Deferral
Elective Deferral means the sum of the following:
-- Any Elective Contribution to any Cash or Deferred
Arrangement to the extent it is not includable in the
Participant's gross income for the taxable year of
contribution;
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<PAGE> 32
-- Any employer contribution to a simplified employee
pension as defined in Code Section 408(k) to the extent
not includable in the Participant's gross income for the
taxable year of contribution;
-- Any employer contribution to an annuity contract under
Code Section 403(b) under a salary reduction agreement to
the extent not includable in the Participant's gross
income for the taxable year of contribution; plus
-- Any employee contribution designated as deductible under
a trust described in Code Section 501(c)(18) for the
taxable year of contribution.
(10) Eligible Employee
Eligible Employee means an Employee who is directly or indirectly
eligible to make a Cash or Deferred Election under the Plan for
all or a portion of the Plan Year. An Employee who is unable to
make a Cash or Deferred Election because the Employee has not
contributed to another plan is also an Eligible Employee. An
Employee who would be eligible to make Elective Contributions but
for a suspension due to a distribution, a loan, or an election
not to participate in the Plan, is treated as an Eligible
Employee for purposes of Code Section 401(k)(3) and 401(m) for a
Plan Year even though the Employee may not make a Cash or
Deferred Election due to the suspension. Also, an Employee will
not fail to be treated as an Eligible Employee merely because the
employee may receive no additional Annual Additions because of
Code Section 415(c)(1) or 415(e).
(11) Employee Contribution
Employee Contribution means any contribution made by an Employee
to any plan maintained by the Employer or any Related Employer
which is other than an Elective Contribution and which is
designated or treated at the time of contribution as an after-tax
contribution. Employee Contributions include amounts
attributable to Excess Contributions which are recharacterized as
Employee Contributions.
(12) Excess Contribution
Excess Contribution means, for each member of the Highly
Compensated Group, the amount of Elective Contribution (including
any Qualified Nonelective Contributions and Qualified Matching
Contributions which are treated as Elective Contributions) which
exceeds the maximum contribution which could be made if the
Deferral Percentage Test were to be satisfied.
(13) Excess Aggregate Contribution
Excess Aggregate Contribution means, for each member of the
Highly Compensated Group, the amount of Employee and Matching
Contributions (including any Qualified Nonelective Contributions
and Elective Contributions which are treated as Matching
Contributions) which exceeds the maximum contribution which could
be made if the Contribution Percentage Test were to be satisfied.
(14) Excess Deferral
Excess Deferral means, for a given calendar year, that amount by
which each Participant's total Elective Deferrals under all plans
of all employers exceed the dollar limit in effect under Code
Section 402(g) for the calendar year.
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<PAGE> 33
(15) Matching Contribution
Matching Contribution means any contribution made by the Employer
to any plan maintained by the Employer or any Related Employer
which is based on an Elective Contribution or an Employee
Contribution together with any forfeiture allocated to the
Participant's Account on the basis of Elective Contributions,
Employee Contributions or Matching Contributions. A Matching
Contribution will be taken into account for a given Plan Year
only if:
-- The Matching Contribution is allocated to a Participant's
Account as of a date within the Plan Year to which it
relates;
-- The allocation is not contingent upon the Employee's
participation in the Plan or performance of services on
any date after the allocation date;
-- The Matching Contribution is actually paid to the Trust
no later than 12 months after the end of the Plan Year to
which the Matching Contribution relates; and
-- The Matching Contribution is based on an Elective or
Employee Contribution for the Plan Year.
Any contribution or allocation, other than a Qualified
Nonelective Contribution, which is used to meet the minimum
contribution or benefit requirement of Code Section 416 is not
treated as being based on Elective Contributions or Employee
Contributions and therefore is not treated as a Matching
Contribution.
Qualified Matching Contribution means a Matching Contribution
which is 100% vested and may be withdrawn or distributed only
under the conditions described in Treasury Regulation
1.401(k)-1(d).
(16) Nonelective Contribution
Nonelective Contribution means any Employer Contribution, other
than a Matching Contribution, which meets all of the following
requirements:
-- The Nonelective Contribution is allocated to a
Participant's Account as of a date within the Plan Year
to which it relates;
-- The allocation is not contingent upon the Employee's
participation in the Plan or performance of services on
any date after the allocation date;
-- The Nonelective Contribution is actually paid to the
Trust no later than 12 months after the end of the Plan
Year to which the Nonelective Contribution relates; and
-- The Employee may not elect to have the Nonelective
Contribution paid in cash in lieu of being contributed to
the Plan.
Qualified Nonelective Contribution means a Nonelective
Contribution which is 100% vested and may be withdrawn or
distributed only under the conditions described in Treasury
Regulation 1.401(k)-1(d).
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<PAGE> 34
(b) Application of Deferral Percentage Test
All Elective Contributions, including any Elective Contributions
which are treated as Employee or Matching Contributions with respect
to the Contribution Percentage Test, must satisfy the Deferral
Percentage Test. Furthermore, any Elective Contributions which are
not treated as Employee or Matching Contributions with respect to the
Contribution Percentage Test must satisfy the Deferral Percentage
Test. The Plan Administrator will determine as soon as
administratively feasible after the end of the Plan Year whether the
Deferral Percentage Test has been satisfied. If the Deferral
Percentage Test is not satisfied, the Employer may elect to make an
additional contribution to the Plan on account of the Non-highly
Compensated Group. The additional contribution will be treated as a
Nonelective Contribution.
If the Deferral Percentage Test is not satisfied after any
Nonelective Contributions, the Plan Administrator may, in its sole
discretion, recharacterize all or any portion of the Excess
Contribution of each Highly Compensated Employee as an Employee
Contribution if Employee Contributions are otherwise allowed by the
Plan. If so, the Plan Administrator will notify all affected
Participants and the Internal Revenue Service of the amount
recharacterized no later than the 15th day of the third month
following the end of the Plan Year in which the Excess Contribution
was made. Excess Contributions will be includable in the
Participant's gross income on the earliest date any Elective
Contribution made on behalf of the Participant during the Plan Year
would have been received by the Participant had the Participant
elected to receive the amount in cash. Recharacterized Excess
Contributions will continue to be treated as Employer Contributions
that are Elective Contributions for all other purposes under the
Code, including Code Sections 401(a) (other than 401(a)(4) and
401(m)), 404, 409, 411, 412, 415, 416, 417 and 401(k)(2). With
respect to the Plan Year for which the Excess Contribution was made,
the Plan Administrator will treat the recharacterized amount as an
Employee Contribution for purposes of the Deferral Percentage Test
and the Contribution Percentage Test and for purposes of determining
whether the Plan meets the requirements of Code Section 401(a)(4),
but not for any other purposes under this Plan. Therefore,
recharacterized amounts will remain subject to the nonforfeiture
requirements and distribution limitations which apply to Elective
Contributions.
If the Deferral Percentage Test is still not satisfied, then after
the close of the Plan Year in which the Excess Contribution arose but
within 12 months after the close of that Plan Year, the Plan
Administrator will distribute the Excess Contributions, together with
allocable income, to the affected Participants of the Highly
Compensated Group to the extent necessary to satisfy the Deferral
Percentage Test. Failure to do so will cause the Plan to not satisfy
the requirements of Code Section 401(a)(4) for the Plan Year for
which the Excess Contribution was made and for all subsequent Plan
Years for which the Excess Contribution remains uncorrected.
The amount of Excess Contribution to be distributed to a Highly
Compensated Employee for a Plan Year will be reduced by any Excess
Deferrals previously distributed to the Participant for the calendar
year ending with or within the Plan Year in accordance with Code
Section 402(g)(2).
Excess Contributions will be treated as Employer Contributions for
purposes of Code Sections 404 and 415 even if distributed from the
Plan.
(c) Application of Contribution Percentage Test
Employee Contributions and Matching Contributions, disregarding any
Matching Contributions which are treated as Elective Contributions
with respect to the Deferral Percentage Test, must satisfy the
Contribution Percentage Test. The Plan Administrator will determine
as soon as administratively feasible after the end of the Plan Year
whether the Contribution
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<PAGE> 35
Test has been satisfied. If the Contribution Percentage Test is not
satisfied, the Employer may elect to make an additional contribution
to the Plan for the benefit of the Non-Highly Compensated Group. The
additional contribution will be treated as a Nonelective Contribution.
If the Contribution Percentage Test is still not satisfied, then
after the close of the Plan Year in which the Excess Aggregate
Contribution arose but within 12 months after the close of that Plan
Year, the Plan Administrator will distribute (or forfeit, to the
extent not vested) the Excess Aggregate Contributions, together with
allocable income, to the affected Participants of the Highly
Compensated Group to the extent necessary to satisfy the Contribution
Percentage Test. Failure to do so will cause the Plan to not satisfy
the requirements of Code Section 401(a)(4) for the Plan Year for
which the Excess Aggregate Contribution was made and for all
subsequent Plan Years for which the Excess Aggregate Contribution
remains uncorrected.
The determination of any Excess Aggregate Contributions will be made
after the recharacterization of any Excess Contributions as Employee
Contributions.
Excess Aggregate Contributions, including forfeited Matching
Contributions, will be treated as Employer Contributions for purposes
of Code Sections 404 and 415 even if they are distributed from the
Plan.
Forfeited Matching Contributions that are reallocated to the Accounts
of other Participants are treated as Annual Additions under Code
Section 415 for the Participant whose Accounts they are reallocated
to and for the Participants from whose Accounts they are forfeited.
(d) Family Aggregation
The Deferral Percentage or the Contribution Percentage (the "Relevant
Percentage") for any Highly Compensated Employee who is subject to
the family aggregation rules of Section 1.18(c) will be determined by
combining the Elective Contributions, Employee Contributions,
Matching Contribution, amounts treated as Elective or Matching
Contributions and Compensation of all the eligible Family Members.
The determination and correction of Excess Contributions and Excess
Aggregate Contributions of a Highly Compensated Employee whose
Relevant Percentage is determined under the family aggregation rules
is accomplished by reducing the Relevant Percentage as provided for
in Sections 4.05(b) and 4.05(c) and Excess Contributions or Excess
Aggregate Contributions for the family group are allocated among the
Family Members whose contributions were combined to determine the
Relevant Percentage in proportion to the Elective Contributions or
Nonelective and Matching Contributions of each Family Member.
For all purposes under this Section, the contributions and
compensation of eligible Family Members who are not Highly
Compensated Employees without regard to family aggregation are
disregarded when determining the Relevant Percentage for the
Non-highly Compensated Group.
(e) Reduction of Excess Amounts
The total Excess Contribution or total Excess Aggregate Contribution
will be reduced in a manner so that the Deferral Percentage or the
Contribution Percentage (Relevant Percentage) of the affected
Participant(s) with the highest Relevant Percentage will first be
lowered to a point not less than the level of the affected
Participant(s) with the next highest Relevant Percentage. If further
overall reductions are required to satisfy the relevant test, each of
the above Participants' (or groups of Participants') Relevant
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<PAGE> 36
Percentage will be lowered to a point not less than the level of the
affected Participant(s) with the next highest Relevant Percentage,
and so on continuing until sufficient total reductions have occurred
to achieve satisfaction of the relevant test.
(f) Priority of Reductions
The Plan Administrator will determine the method and order of
correcting Excess Contributions and Excess Aggregate Contributions.
The method of correcting Excess Contributions and Excess Aggregate
Contributions must meet the requirements of Code Section 401(a)(4).
The determination of whether a rate of Matching Contribution
discriminates under Code Section 401(a)(4) will be made after making
any corrective distributions of Excess Deferrals, Excess
Contributions and Excess Aggregate Contributions.
Excess Aggregate Contributions (and any attributable income) will be
corrected first, by distributing any excess Employee Contributions
(and any attributable income); then by distributing vested excess
Matching Contributions (and any attributable income); and finally, by
forfeiting or distributing non-vested Matching Contributions (and any
attributable income). The Plan will not distribute Employee
Contributions while the Matching Contributions based upon those
Employee Contributions remain allocated.
(g) Income
The income allocable to any Excess Contribution made to a given
Account for a given Plan Year will be equal to the total income
allocated to the Account for the Plan Year, multiplied by a fraction,
the numerator of which is the amount of the Excess Contribution and
the denominator of which is equal to the sum of the balance of the
Account at the beginning of the Plan Year plus the Participant's
Elective Contributions and amounts treated as Elective Contributions
for the Plan Year.
The income allocable to any Excess Aggregate Contribution made to a
given Account for a given Plan Year will be equal to the total income
allocated to the Account for the Plan Year, multiplied by a fraction,
the numerator of which is the amount of the Excess Aggregate
Contribution and the denominator of which is equal to the sum of the
balance of the Account at the beginning of the Plan Year plus the
Participant's Employee and Matching Contributions and amounts treated
as Employee and Matching Contributions for the Plan Year.
Notwithstanding the foregoing, the Plan may use any reasonable method
for computing the income allocable to any Excess Contribution or
Excess Aggregate Contribution provided the method does not violate
Code Section 401(a)(4), is used consistently for all corrective
distributions under the Plan for the Plan Year, and is used by the
Plan for allocating income to the Participants' Accounts.
Income includes all earnings and appreciation, including interest,
dividends, rents, royalties, gains from the sale of property, and
appreciation in the value of stocks, bonds, annuity and life
insurance contracts and other property, regardless of whether the
appreciation has been realized.
(h) Treatment as Elective Contributions
The Plan Administrator may, in its discretion, treat all or any
portion of Qualified Nonelective Contributions or Qualified Matching
Contributions or both, whether to this Plan or to any other qualified
plan which has the same Plan Year and is maintained by the Employer
or a Related Employer, as Elective Contributions for purposes of
satisfying the Deferral Percentage Test if they meet all of the
following requirements:
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<PAGE> 37
-- All Nonelective Contributions, including the Qualified
Nonelective Contributions treated as Elective Contributions for
purposes of the Deferral Percentage Test, satisfy the
requirements of Code Section 401(a)(4);
-- Any Nonelective Contributions which are not treated as Elective
Contributions for purposes of the Deferral Percentage Test or as
Matching Contributions for purposes of the Contribution
Percentage Test satisfy the requirements of Code Section
401(a)(4);
-- The Qualified Matching Contributions which are treated as
Elective Contributions for purposes of the Deferral Percentage
Test are not taken into account in determining whether any
Employee Contributions or other Matching Contributions satisfy
the Contribution Percentage Test;
-- Any Matching Contributions which are not treated as Elective
Contributions for purposes of the Deferral Percentage Test
satisfy the requirements of Code Section 401(m); and
-- The plan which includes the Cash or Deferred Arrangement and the
plan or plans to which the Qualified Nonelective Contributions
and Qualified Matching Contributions are made could be aggregated
for purposes of Code Section 410(b).
(i) Treatment as Matching Contributions
The Plan Administrator may, in its discretion, treat all or any
portion of Qualified Nonelective Contributions or Elective
Contributions or both, whether to this Plan or to any other qualified
plan which has the same Plan Year and is maintained by the Employer
or a Related Employer, as Matching Contributions for purposes of
satisfying the Contribution Percentage Test if they meet all of the
following requirements:
-- All Nonelective Contributions, including the Qualified
Nonelective Contributions treated as Matching Contributions for
purposes of the Contribution Percentage Test, satisfy the
requirements of Code Section 401(a)(4);
-- Any Nonelective Contributions which are not treated as Elective
Contributions for purposes of the Deferral Percentage Test or as
Matching Contributions for purposes of the Contribution
Percentage Test satisfy the requirements of Code Section
401(a)(4);
-- The Elective Contributions which are treated as Matching
Contributions for purposes of the Contribution Percentage Test
are not taken into account in determining whether any other
Elective Contributions satisfy the Deferral Percentage Test;
-- The Qualified Nonelective Contributions and Elective
Contributions which are treated as Matching Contributions for
purposes of the Contribution Percentage Test are not taken into
account in determining whether any other contributions or
benefits satisfy Code Section 401(a); and
-- All Elective Contributions, including those treated as Matching
Contributions for purposes of the Contribution Percentage Test,
satisfy the requirements of Code Section 401(k)(3); and
-- The plan that takes Qualified Nonelective Contributions and
Elective Contributions into account in determining whether
Employee and Matching Contributions satisfy the requirements of
Code Section 401(m)(2)(A) and the plan or plans to which the
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<PAGE> 38
Qualified Nonelective Contributions and Elective Contributions
are made could be aggregated for purposes of Code Section 410(b).
(j) Aggregation of Plans
If the Employer or a Related Employer sponsors one or more other
plans which include a Cash or Deferred Arrangement, the Employer may
elect to treat any two or more of such plans as an aggregated single
plan for purposes of satisfying Code Sections 401(a)(4), 401(k) and
410(b). The Cash of Deferred Arrangements included in such
aggregated plans will be treated as a single Arrangement for purposes
of this Section. However, only those plans that have the same plan
year may be so aggregated.
If the Employer or a Related Employer sponsors one or more other
plans to which Employee Contributions or Matching Contributions are
made, the Employer may elect to treat any two or more of such plans
as an aggregated single plan for purposes of satisfying Code Sections
401(a)(4), 401(m) and 410(b). However, only those plans that have
the same plan year may be so aggregated.
Any such aggregation must be made in accordance with Treasury
Regulation 1.401(k)-1(b)(3). For example, contributions and
allocations under the portion of a plan described in Code Section
4975(e)(7) (an ESOP) may not be aggregated with the portion of a plan
not described in Code Section 4975(e)(7) (a non-ESOP) for purposes of
determining whether the ESOP or non-ESOP satisfies the requirements
of Code Sections 401(a)(4), 401(k), 401(m) and 410(b).
Plans that could be aggregated under Code Section 410(b) but that are
not actually aggregated for a Plan Year for purposes of Code Section
410(b) may not be aggregated for purposes of Code Sections 401(k) and
401(m).
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ARTICLE 5
RETIREMENT BENEFITS
5.01 Valuation of Accounts
For purposes of this Article, the value of a Participant's Accrued
Benefit will be determined as of the Valuation Date coincident with or
immediately preceding the date that benefits are to be distributed.
5.02 Normal Retirement
After an Active Participant reaches his Normal Retirement Date, he may
elect to retire. Upon such retirement he will become a Retired
Participant and his Accrued Benefit will become distributable to him. A
Participant's Accrued Benefit will become nonforfeitable no later than
the date upon which he attains his Normal Retirement Age. The form of
benefit payment will be governed by the provisions of Section 5.05.
5.03 Disability Retirement
In the event of a Participant's termination due to Disability, he will be
entitled to begin to receive a distribution of his Accrued Benefit which
will become nonforfeitable as of his date of termination. The form of
benefit payment will be governed by the provisions of Section 5.05.
Disability means the determination by the Plan Administrator that a
Participant is unable by reason of any medically determinable physical or
mental impairment to perform the usual duties of his employment or of any
other employment for which he is reasonably qualified based upon his
education, training and experience.
5.04 Termination of Employment
(a) In General
If a Participant's employment terminates for any reason other than
retirement, death, or disability, his Vested Accrued Benefit will
become distributable to him as of the Valuation Date which coincides
with or next follows his date of termination of employment (or as of
such earlier date as determined by the Plan Administrator in a
uniform and nondiscriminatory manner). The form of benefit payment
will be governed by the provisions of Section 5.05.
(b) Cash-Out Distribution
If a Participant terminates employment and receives a distribution
equal to the Vested Percentage of his Accounts which are subject to
the Vesting Schedule (such Accounts are hereinafter referred to as
Employer Contribution Accounts), a Cash-Out Distribution will be
deemed to have occurred if the following conditions are met:
(1) The Participant was less than 100% vested in his Employer
Contribution Accounts; and
(2) The entire distribution is made before the last day of the second
Plan Year following the Plan Year in which the Participant
terminated employment.
(c) Restoration of Employer Contribution Accounts
If, following the date of a Cash-Out Distribution, a Participant
returns to an Eligible Employee Classification prior to incurring 5
consecutive One Year Breaks-in-Service, then the Participant will
have the right to repay to the Trustee, within 5 years after his
return date, the portion of the Cash-Out Distribution which was
attributable to his
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<PAGE> 40
Employer Contribution Accounts which were less than 100% vested in
order to restore such Accounts to their value as of the date of the
Cash-Out Distribution.
The Plan Administrator will restore an eligible Participant's
Employer Contribution Accounts as of the Valuation Date coincident
with or immediately following the complete repayment of the Cash-Out
Distribution. To restore the Participant's Employer Contribution
Accounts, the Plan Administrator, to the extent necessary, will,
under rules and guidelines applied in a uniform and nondiscriminatory
manner, allocate to the Participant's Employer Contribution Accounts:
-- First, the amount, if any, of Forfeitures which would otherwise
be allocated under Article 3;
-- Second, the amount, if any, of the Trust Fund net income or gain
for the Accounting Period.
To the extent the amounts available for restoration for a particular
Accounting Period are insufficient to enable the Plan Administrator
to make the required restoration, the Employer will contribute such
additional amount as is necessary to enable the Plan Administrator to
make the required restoration. The Plan Administrator will not take
into account the allocation under this Section in applying the
limitation on allocations under Article 7.
Until the Plan Administrator restores a Participant's Employer
Contribution Accounts, the Trustee will invest any amount the
Participant has repaid in a segregated account maintained solely for
that Participant. The Trustee will invest the amount in the
Participant's segregated account in an interest-bearing savings
account, time deposit, or similar type of account. Until commingled
with the balance of the Trust Fund on the date the Plan Administrator
restores the Participant's Employer Contribution Accounts, the
Participant's segregated account will remain a part of the Trust, but
it alone will share in any income it earns and it alone will bear any
expense or loss it incurs.
(d) Non-Vested Participant
If a Participant who is zero percent vested in his Employer
Contribution Accounts terminates employment, a Cash-Out Distribution
will be deemed to have occurred as of the Participant's date of
termination of employment.
If the Participant subsequently returns to an Eligible Employee
Classification prior to incurring five consecutive One Year
Breaks-in-Service, then the Participant will immediately become
entitled to a complete restoration of his Employer Contribution
Accounts as of the Valuation Date coincident with or next following
his date of re-employment. Such restoration will be made in
accordance with the provisions of Section 5.04(c).
5.05 Form of Benefit Payment
The Plan Administrator will direct the Trustee to make the payment of any
benefit provided under this Plan upon the event giving rise to such
benefit within the time prescribed by this Article. The form of benefit
will be a lump sum payment, unless the Participant elects a direct
transfer pursuant to Section 5.07.
If a Participant's Vested Accrued Benefit is in excess of $3,500, any
payment of benefits prior to the Participant's Normal Retirement Date
will be subject to the Participant's written consent. If the value of
his Vested Accrued Benefit at the time of any distribution exceeds
$3,500, the value of his Vested Accrued Benefit at any later time will be
deemed to also
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<PAGE> 41
exceed $3,500.
5.06 Commencement of Benefit
Subject to the provisions of this Article, commencement of a benefit
will, unless the Participant elects otherwise in writing, begin not later
than the 60th day after the later of the close of the Plan Year in which
the Participant attains Normal Retirement Age or the close of the Plan
Year which contains the date the Participant terminates his service with
the Employer.
Payment of a Participant's benefits must begin no later than his Required
Beginning Date.
For purposes of this Section, life expectancy and joint and last survivor
expectancy are to be computed by the use of the return multiples
contained in Section 1.72-9 of the Income Tax Regulations.
If the Participant dies after distribution of his interest has begun, the
remaining portion of the interest will continue to be distributed at
least as rapidly as under the method of distribution being used before
the Participant's death.
All distributions required under this Section will be determined and made
in accordance with the regulations issued under Code Section 401(a)(9),
including those dealing with minimum distribution requirements.
5.07 Directed Transfer of Eligible Rollover Distributions
(a) General
This Section applies to distributions made on or after January 1,
1993. Notwithstanding any provision of the Plan to the contrary that
would otherwise limit a Distributee's election under this Section, a
Distributee may elect, at the time and in the manner prescribed by
the Plan Administrator, to have any portion of an Eligible Rollover
Distribution paid directly to an Eligible Retirement Plan specified
by the Distributee in a Direct Rollover.
(b) Eligible Rollover Distribution
An Eligible Rollover Distribution is any distribution of all or any
portion of the balance to the credit of the Distributee, except that
an Eligible Rollover Distribution does not include: any distribution
that is one of a series of substantially equal periodic payments (not
less frequently than annually) made for the life (or life expectancy)
of the Distributee or the joint lives (or joint life expectancies) of
the Distributee and the Distributee's designated beneficiary, or for
a specified period of ten years or more; any distribution to the
extent such distribution is required under section 401(a)(9) of the
Code; and the portion of any distribution that is not includible in
gross income (determined without regard to the exclusion for net
unrealized appreciation with respect to employer securities).
(c) Eligible Retirement Plan
An Eligible Retirement Plan is an individual retirement account
described in section 408(a) of the Code, an individual retirement
annuity described in section 408(b) of the Code, or a qualified trust
described in section 401(a) of the Code, that accepts the
Distributee's Eligible Rollover Distribution. However, in the case
of an Eligible Rollover Distribution to the surviving spouse, an
Eligible Retirement Plan is an individual retirement account or
individual retirement annuity.
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<PAGE> 42
(d) Distributee
A Distributee includes an Employee or Former Employee. In addition,
the Employee's or Former Employee's surviving spouse and the
Employee's or Former Employee's spouse or former spouse who is the
alternate payee under a qualified domestic relations order, as
defined in section 414(p) of the Code, are Distributees with regard
to the interest of the spouse or former spouse.
(e) Direct Rollover
A Direct Rollover is a payment by the Plan to the Eligible Retirement
Plan specified by the Distributee.
(f) Waiver of 30-Day Notice
If a distribution is one to which Code Sections 401(a)(11) and 417 do
not apply, such distribution may commence less than 30 days after the
notice required under Section 1.411(a)-11(c) of the Income Tax
Regulations is given, provided that:
-- the Plan Administrator clearly informs the Participant that the
Participant has a right to a period of at least 30 days after
receiving the notice to consider the decision of whether or not
to elect a distribution (and, if applicable, a particular
distribution option); and
-- the Participant, after receiving the notice, affirmatively elects
to receive a distribution.
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ARTICLE 6
DEATH BENEFIT
6.01 Valuation of Accounts
For purposes of this Article, the value of a Participant's Accrued
Benefit will be determined as of the Valuation Date coincident with or
immediately preceding the date that benefits are to be distributed.
6.02 Death Benefit
In the event of the death of a Participant prior to the date on which he
receives a complete distribution of his benefit under the Plan, the
Participant's Beneficiary will be entitled to receive the value of the
Participant's Accrued Benefit.
6.03 Designation of Beneficiary
Each Participant will be given the opportunity to designate a Beneficiary
or Beneficiaries, and from time to time the Participant may file with the
Plan Administrator a new or revised designation on the form provided by
the Plan Administrator. If a Participant is married, any designation of
a Beneficiary other than the Participant's spouse must be consented to by
the Participant's spouse pursuant to a Qualified Election.
If a Participant dies without designating a Beneficiary, or if the
Participant is predeceased by all designated Beneficiaries and contingent
Beneficiaries, the Plan Administrator will distribute all benefits which
are payable in the event of the Participant's death in the following
manner and to the first of the following (who are listed in order of
priority) who survive the Participant by at least 30 days:
-- All to the Participant's Surviving Spouse;
-- Equally among the then living children of the Participant (by birth
or adoption);
-- Between the Participant's surviving parents, in equal shares; or
-- The Participant's estate.
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ARTICLE 7
LIMITATIONS ON BENEFITS
7.01 Limitation on Annual Additions
The amount of the Annual Addition which may be allocated under this Plan
to any Participant's Account as of any Valuation Date will not exceed the
Defined Contribution Limit (based upon his Aggregate Compensation up to
such Valuation Date) reduced by the sum of any allocations of annual
additions made to Participant's Accounts under this Plan as of any
preceding Valuation Date within the Limitation Year.
If the Annual Addition under this Plan on behalf of a Participant is to
be reduced as of any Valuation Date as a result of the next preceding
paragraph, the reduction will be, to the extent required, effected by
first reducing Participant contributions (which increase the annual
addition), then Forfeitures (if any), and then Employer contributions to
be allocated under this Plan on behalf of the Participant as of the
Valuation Date.
Any necessary reduction will be made as follows:
(a) The amount of the reduction consisting of nondeductible Participant
contributions will be paid to the Participant as soon as
administratively feasible.
(b) The amount of the reduction consisting of any other Participant
contributions will be paid to the Participant as soon as
administratively feasible.
(c) The amount of the reduction consisting of Forfeitures will be
allocated and reallocated to other Accounts in accordance with the
Plan formula for allocating Forfeitures to the extent that such
allocations do not cause the additions to any other Participant's
Accounts to exceed the lesser of the Defined Contribution Limit or
any other limitation provided in the Plan.
(d) The amount of the reduction consisting of Employer contributions will
be allocated and reallocated to other Accounts in accordance with the
Plan formula for Employer Contributions to the extent that such
allocations do not cause the additions to any other Participant's
Accounts to exceed the lesser of the Defined Contribution Limit or
any other limitation provided in the Plan.
(e) To the extent that the reductions described in paragraph (d) cannot
be allocated to other Participant's Accounts, the reductions will be
allocated to a suspense account as Forfeitures and held therein until
the next succeeding Valuation Date on which Forfeitures could be
applied under the provisions of the Plan. All amounts held in a
suspense account must be applied as Forfeitures before any additional
contributions, which would constitute annual additions, may be made
to the Plan. If the Plan terminates, the suspense account will
revert to the Employer to the extent it may not be allocated to any
Participant's Accounts.
(f) If a suspense account is in existence at any time during a Limitation
Year pursuant to this Section, it will not participate in the
allocation of the Trust Fund's investment gains and losses.
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7.02 Where Employer Maintains Another Qualified Plan
(a) Where Employer Maintains Another Qualified Defined Contribution
Plan If the Employer maintains this Plan and one or more other
qualified defined contribution plans, one or more welfare benefit
funds (as defined in Code Section 419(e)), or one or more individual
medical accounts (as defined in Code Section 415(l)(2)), all of which
are referred to in this Article 7 as "qualified defined contribution
plans", the annual additions allocated under this Plan to any
Participant's Accounts will be limited in accordance with the
allocation provisions of this Section 7.02(a).
The amount of the Annual Additions which may be allocated under this
Plan to any Participant's Accounts as of any Valuation Date will not
exceed the Defined Contribution Limit (based upon Aggregate
Compensation up to the allocation date) reduced by the sum of any
allocations of Annual Additions made to the Participant's Accounts
under this Plan and any other qualified defined contribution plans
maintained by the Employer as of any earlier Valuation Date within
the Limitation Year.
If a Valuation Date of this Plan coincides with a Valuation Date of
any other plan described in the above paragraph, the amount of Annual
Additions to be allocated on behalf of a Participant under this Plan
as of such date will be an amount equal to the product of the amount
described in the next preceding paragraph multiplied by a fraction
(not to exceed 1.0), the numerator of which is the amount to be
allocated under this Plan without regard to this Article during the
Limitation Year and the denominator of which is the amount that would
otherwise be allocated on this Valuation Date under all plans without
regard to this Article 7.
If the Annual Addition under this Plan on behalf of a Participant is
to be reduced as of any Valuation Date as a result of the next
preceding two paragraphs, the reduction will be, to the extent
required, effected by first reducing Participant contributions (which
increase the annual addition), then Forfeitures (if any), and then
any Employer contributions, to be allocated under this Plan on behalf
of the Participant as of the Valuation Date.
If as a result of the first four paragraphs of this Section 7.02 the
allocation of additions is reduced, the reduction will be treated in
the manner described in the third paragraph of Section 7.01.
(b) Where Employer Maintains a Qualified Defined Benefit Plan
(1) In General
If the Employer maintains (or has ever maintained), in addition
to this Plan, one or more qualified defined benefit plans, then
for any Limitation Year, the sum of the Defined Benefit Plan
Fraction and the Defined Contribution Plan Fraction will not
exceed 1.0. If, in any Limitation Year, the sum of the Defined
Benefit Plan Fraction and the Defined Contribution Plan Fraction
for a Participant would exceed 1.0 without adjustment to the
amount of the annual benefit that can be paid to the Participant
under the defined benefit plan, then the amount of annual benefit
that would otherwise be paid to the Participant under the defined
benefit plan will be reduced to the extent necessary to reduce
the sum of the Defined Benefit Plan Fraction and the Defined
Contribution Plan Fraction for the Participant to 1.0.
(2) Transition Rule under TRA '86
If a plan was in existence on May 6, 1986, the numerator of the
Defined Contribution Plan Fraction will be reduced (to not less
than zero) as prescribed by the Secretary
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of the Treasury by subtracting the amount required to decrease
the sum of the Defined Contribution Plan Fraction plus the
Defined Benefit Plan Fraction to 1.0. Such amount is determined
(as of the first day of the first Limitation Year beginning on or
after January 1, 1987) as the product of:
(A) The amount by which, without this adjustment, the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit
Plan Fraction exceeds 1.0, multiplied by
(B) The denominator of the Defined Contribution Plan Fraction, as
computed through the last Limitation Year beginning before
January 1, 1987, disregarding any changes in the terms and
conditions of the plan after May 5, 1986.
This subparagraph applies only if the defined benefit plans
individually and in the aggregate satisfied the requirements of
Code Section 415 for all Limitation Years beginning before
January 1, 1987.
(3) Transition Rule under TEFRA
In the case of a plan which met the limitation of Section 415 of
the Code for the last Limitation Year beginning before January 1,
1983, the numerator of the Defined Contribution Plan Fraction
will be reduced (to not less than zero) as prescribed by the
Secretary of the Treasury by subtracting the amount required to
decrease the sum of the Defined Contribution Plan Fraction plus
the Defined Benefit Plan Fraction to 1.0. Such amount is
determined (as of the first day of the first Limitation Year
beginning on or after January 1, 1983) as the product of:
(A) The amount by which, without this adjustment, the sum of the
Defined Contribution Plan Fraction plus the Defined Benefit
Plan Fraction exceeds 1.0, multiplied by
(B) The denominator of the Defined Contribution Plan Fraction, as
computed through the last Limitation Year beginning before
January 1, 1983.
7.03 Definitions Applicable to Article 7
(a) Aggregate Compensation
Aggregate Compensation means a Participant's earned income, wages,
salaries, and fees for professional services, and other amounts
received for personal services actually rendered in the course of
employment with the employer maintaining the plan (including, but not
limited to, commissions paid to salesmen, compensation for services
on the basis of a percentage of profits, commissions on insurance
premiums, tips and bonuses), and excluding the following:
-- Employer contributions to a plan of deferred compensation which
are not included in the employee's gross income for the taxable
year in which contributed or employer contributions under a
simplified employee pension plan to the extent the contributions
are deductible by the employee, or any distributions from a plan
of deferred compensation;
-- Amounts realized from the exercise of a nonqualified stock
option, or when restricted stock (or property) held by the
employee either becomes freely transferable or is no longer
subject to a substantial risk of forfeiture;
-- Amounts realized from the sale, exchange or other disposition of
stock acquired under a qualified stock option; and
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-- Other amounts which received special tax benefits, or
contributions made by the employer (whether or not under a salary
reduction agreement) toward the purchase of an annuity described
in Code Section 403(b) (whether or not the amounts are actually
excludable from the gross income of the employee).
Aggregate Compensation excludes any amounts contributed by the
Employer or any Related Employer on behalf of any Employee pursuant
to a salary reduction agreement which are not includable in the gross
income of the Employee due to Code Section 125, 402(a)(8), 402(h) or
403(b).
Aggregate Compensation in excess of the Statutory Compensation Limit
is disregarded.
Aggregate Compensation for any Limitation Year is the Aggregate
Compensation actually paid or includable in gross income in such
year.
(b) Allocation Date, Valuation Date
These terms are used interchangeably and mean the date with respect
to which all or a portion of employer contributions, employee
contributions or forfeitures or both are allocated to participant
accounts under a defined contribution plan.
(c) Annual Additions
For Plan Years beginning after December 31, 1986, Annual Additions
are the sum of the following amounts allocated to any defined
contribution plan maintained by the Employer (including voluntary
contributions to any defined benefit plan maintained by the Employer)
on behalf of a Participant for a Limitation Year:
-- All Employee and Employer contributions;
-- All reallocated forfeitures;
-- Amounts allocated after March 31, 1984, to an individual medical
account, as defined in Code Section 415(l)(2) which is part of a
pension or annuity plan maintained by the Employer, and amounts
derived from contributions paid or accrued after December 31,
1985, in taxable years ending after that date, which are
attributable to post-retirement medical benefits required by Code
Section 401(h)(6) to be allocated to the separate account of a
Key Employee under a welfare benefit plan (as defined in Code
Section 419(e)) maintained by the Employer.
Contributions or forfeitures will be treated as Annual Additions
regardless of whether they constitute Excess Deferrals, Excess
Contributions or Excess Aggregate Contributions within the meaning of
the regulations under Code Section 401(k) or 401(m) and regardless of
whether they are corrected through distribution or
recharacterization. The Annual Addition for any Limitation Year
beginning before January 1, 1987, will not be recomputed to treat all
Employee contributions as Annual Additions.
(d) Annual Benefit
Annual Benefit means a benefit payable annually in the form of a
straight life annuity (with no ancillary benefits) under a plan to
which employees do not contribute and under which no rollover
contributions are made.
(e) Defined Benefit Compensation Limit
The Defined Benefit Compensation Limit is equal to 100% of the
Participant's average Aggregate Compensation for the three
consecutive calendar years (or other twelve
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<PAGE> 48
consecutive month periods adopted by the Employer pursuant to a
Written Resolution and applied on a uniform and consistent basis) of
service during which the Participant had the greatest Aggregate
Compensation.
Where the annual benefit is payable to a Participant in a form other
than a straight life annuity or a Qualified Joint and Survivor
Annuity, the Defined Benefit Compensation Limit will be the Actuarial
Equivalent of a straight life annuity beginning at the same age. No
adjustment is required for the following: pre-retirement disability
benefits, pre-retirement death benefits and post-retirement medical
benefits. For purposes of this paragraph, the interest rate used in
adjusting the Defined Benefit Compensation Limit will be the greater
of (1) 5%, or (2) the post-retirement interest rate specified in the
plan for Actuarial Equivalent purposes.
Where the annual benefit is payable to a Participant who has fewer
than 10 years of service with the Employer or any Related or
Predecessor Employer, the Defined Benefit Compensation Limit will be
multiplied by a fraction, the numerator of which is the Participant's
number of years of service with the Employer or Related or
Predecessor Employer, and the denominator of which is 10.
With regard to a Participant who has separated from service with a
nonforfeitable right to an Accrued Benefit, the Defined Benefit
Compensation Limit will be adjusted effective January 1 of each
Calendar year. For any Limitation Year beginning after the
separation occurs, the Defined Benefit Compensation Limit will be
equal to the Defined Benefit Compensation Limit which was applicable
to the Participant in the Limitation Year in which he separated from
service multiplied by a fraction, the numerator of which is the
Defined Benefit Dollar Limit for the Limitation Year in which the
Defined Benefit Compensation Limit is being adjusted and the
denominator of which is the Defined Benefit Dollar Limit for the
Limitation Year in which the Participant separated from service.
(f) Defined Benefit Dollar Limit
The Defined Benefit Dollar Limit is equal to $90,000 for calendar
years 1984 through 1987. As of January 1, 1988 and as of January 1
of each subsequent calendar year, the dollar limitation (described in
Code Section 415(b)(1)(A)) as determined by the Secretary of the
Treasury for that calendar year will become effective as the Defined
Benefit Dollar Limit for the calendar year. For calendar years
between 1976 and 1983, the Defined Benefit Dollar Limit is $75,000 as
adjusted by the Secretary of the Treasury under Code Section 415(d)
for that calendar year. The Defined Benefit Dollar Limit for a
calendar year applies to Limitation Years ending with or within that
calendar year.
Where the annual benefit is payable to a Participant in a form other
than a straight life annuity or a Qualified Joint and Survivor
Annuity, the Defined Benefit Dollar Limit will be the Actuarial
Equivalent of a straight life annuity beginning at the same age. No
adjustment is required for the following: pre-retirement disability
benefits, pre-retirement death benefits, and post-retirement medical
benefits. For purposes of this paragraph, the interest rate used for
adjusting the Defined Benefit Dollar Limit will be the greater of (1)
5%, or (2) the post-retirement interest rate specified for Actuarial
Equivalent purposes.
Where the annual benefit is payable to a Participant who has fewer
than 10 years of participation in the Plan, the Defined Benefit
Dollar Limit will be multiplied by a fraction, the numerator of which
is the Participant's number of years (or part thereof) of
participation in the Plan, and the denominator of which is 10. To
the extent provided by the Secretary of the Treasury, this paragraph
will be applied to each change in the benefit structure of the Plan.
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<PAGE> 49
For a benefit commencing before a Participant's Social Security
Retirement Age but at or after age 62, the Defined Benefit Dollar
Limit will be adjusted in a manner which is consistent with the
reduction for old-age insurance benefits commencing before Social
Security Retirement Age under the Social Security Act. The reduction
will be 5/9 of 1% for each of the first 36 months and 5/12 of 1% for
each additional month (up to 24 months) by which benefits commence
before the month of the Participant's Social Security Retirement Age.
The Defined Benefit Dollar Limit for a benefit commencing before age
62 will be adjusted to the Actuarial Equivalent of the Defined
Benefit Dollar Limit for a benefit commencing at age 62 based on an
interest rate equal to the greater of (1) 5%, or (2) the interest
rate specified in the plan for determining actuarial equivalence for
early retirement.
For a benefit commencing after a Participant's Social Security
Retirement Age, the Defined Benefit Dollar Limit will be adjusted to
the actuarial equivalent of the Defined Benefit Dollar Limit for a
benefit commencing at the Participant's Social Security Retirement
Age. For purposes of this paragraph, the interest rate used for
adjusting the Defined Benefit Dollar Limit will be the lesser of (1)
5%, or (2) the interest rate specified in the plan for determining
actuarial equivalence for early retirement.
(g) Defined Benefit Limit
The Defined Benefit Limit is the lesser of the Defined Benefit Dollar
Limit or the Defined Benefit Compensation Limit.
(h) Defined Benefit Plan Fraction Denominator
The Defined Benefit Plan Fraction Denominator with respect to any
Participant is the lesser of (1) the product of the Defined Benefit
Dollar Limit multiplied by 1.25, or (2) the product of the Defined
Benefit Compensation Limit multiplied by 1.4. However, for purposes
of determining the Defined Benefit Plan Fraction Denominator, "years
of service with the Employer or any Related or Predecessor Employer"
will be substituted for "years of participation in the Plan" wherever
it appears in Section 7.03(f).
(i) Defined Benefit Plan Fraction
The Defined Benefit Plan Fraction is a fraction determined as of the
close of a Limitation Year, the numerator of which is the Projected
Annual Benefit payable to a Participant under this Plan and the
denominator of which is the Defined Benefit Fraction Denominator. If
a Participant has participated in more than one defined benefit plan
maintained by the Employer, the numerator of the Defined Benefit Plan
Fraction is the sum of the projected annual benefits payable to the
Participant under all of the defined benefit plans, whether or not
terminated.
(j) Defined Contribution Limit
The Defined Contribution Limit for a given Limitation Year is equal
to the lesser of (1) the Defined Contribution Compensation Limit,
which is 25% of Aggregate Compensation applicable to the Limitation
Year, or (2) the Defined Contribution Dollar Limit, which, for
calendar years after 1983 is the greater of $30,000 or one-fourth of
the Defined Benefit Dollar Limit for the Limitation Year, and for
calendar years between 1976 and 1983 is one-third of the Defined
Benefit Dollar Limit. If a short Limitation Year is created because
of an amendment changing the Limitation Year to a different 12
consecutive month period, the Defined Contribution Dollar Limit is
multiplied by a fraction, the numerator of which is equal to the
number of months in the short Limitation Year and the denominator of
which is 12.
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(k) Defined Contribution Plan Fraction
The Defined Contribution Plan Fraction is a fraction determined as of
the close of a Limitation Year, the numerator of which is the sum of
the Annual Additions to the Participant's Accounts under all defined
contribution plans of the Employer for the current and all prior
Limitation Years and the denominator of which is the sum of the
Annual Additions which would have been made for the Participant for
the current and all prior Limitation Years (for all prior years of
service with the Employer or any predecessor Employer) if in each
Limitation year the Annual Additions equaled the lesser of (1) the
product of the Defined Contribution Compensation Limit for the
Limitation Year multiplied by 1.4, or (2) the product of the Defined
Contribution Dollar Limit for the Limitation Year multiplied by 1.25.
The aggregate amount in the numerator of this fraction due to years
beginning before January 1, 1976 may not exceed the aggregate amount
in the denominator of this fraction for all such years.
For purposes of this Section 7.03(k), the Annual Addition for any
Limitation Year beginning before January 1, 1987 will not be
recomputed to treat all Employee contributions as Annual Additions.
(l) Employer
The Employer is the Employer that adopts this Plan together with all
Related Employers. For this purpose, the definition of Related
Employer in Section 1.33 of this Plan is modified by Code Section
415(h).
(m) Limitation Year
The Limitation Year will be the 12 consecutive month period which is
specified in Article 1 of this Plan and which is adopted for all
qualified plans maintained by the Employer pursuant to a Written
Resolution adopted by the Employer. In the event of a change in the
Limitation Year, the additional limitations of Treasury Regulation
Section 1.415-2(b)(4)(iii) will also apply.
(n) Projected Annual Benefit
For purposes of this Section, a Participant's Projected Annual
Benefit is equal to the annual benefit to which a Participant in a
defined benefit Plan would be entitled under the terms of the plan
based on the following assumptions:
-- The Participant will continue employment until reaching normal
retirement age as determined under the terms of the plan (or
current age, if that is later);
-- The Participant's compensation for the Limitation Year under
consideration will remain the same for all future years;
-- All other relevant factors used to determine benefits under the
plan for the Limitation Year under consideration will remain
constant for all future Limitation Years; and
-- The benefits resulting from any Participant Contributions or
Rollover Contributions are disregarded.
(o) Social Security Retirement Age
Social Security Retirement Age means age 65 for a Participant born
before January 1, 1938; age 66 for a Participant born after December
31, 1937, but before January 1, 1955; and age 67 for a Participant
born after December 31, 1954.
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(p) Transition Rule Under TRA '86
If at the beginning of the first Limitation Year beginning after
December 31, 1986, an Employee was a Participant in a defined benefit
plan of the Employer or any Related Employer that was in existence on
May 6, 1986, the Defined Benefit Dollar Limit for that Participant is
the greater of the Defined Benefit Dollar Limit described above or
the Participant's Current Accrued Benefit on that date determined
without regard to changes in the terms and conditions of the Plan or
cost-of-living increases occurring after May 5, 1986. This Section
7.03(p) applies only if all defined benefit plans maintained by the
Employer and all Related Employers, individually and in the
aggregate, satisfied the requirements of Code Section 415 for all
Limitation Years beginning before January 1, 1987.
7.04 Effect of Top-Heavy Status
(a) General
Notwithstanding the provisions of Section 7.03, "1.0" will be
substituted for "1.25" wherever it appears in Sections 7.03(h) and
7.03(k) for any Limitation Year in which the Plan is found to be
Top-Heavy for the Plan Year which coincides with or ends within such
Limitation Year.
(b) Non-application
Section 7.04(a) will not apply for any Limitation Year in which, for
the Plan Year which coincides with or ends within such Limitation
Year, (1) the Plan is not determined to be Super Top-Heavy and (2)
for any Non-Key Employee who is a Participant in both this Plan and a
defined benefit plan maintained by the Employer or a Related
Employer, the annual allocation of Employer contributions plus
Forfeitures under this Plan is not less than 7.5% of the Non-Key
Employee's Aggregate Compensation.
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ARTICLE 8
MISCELLANEOUS
8.01 Employment Rights of Parties Not Restricted
The adoption and maintenance of this Plan will not be deemed a contract
between the Employer and any Employee. Nothing in this Plan will give
any Employee or Participant the right to be retained in the employ of the
Employer or to interfere with the right of the Employer to discharge any
Employee or Participant at any time, nor will it give the Employer the
right to require any Employee or Participant to remain in its employ, or
to interfere with any Employee's or Participant's right to terminate his
employment at any time.
8.02 Alienation
(a) General
No person entitled to any benefit under this Plan will have any right
to sell, assign, transfer, hypothecate, encumber, commute, pledge,
anticipate or otherwise dispose of his interest in the benefit, and
any attempt to do so will be void. No benefit under this Plan will
be subject to any legal process, levy, execution, attachment or
garnishment for the payment of any claim against such person.
(b) Exceptions
Section 8.02(a) will not apply to the extent a Participant or
Beneficiary is indebted to the Plan under the provisions of the Plan.
At the time a distribution is to be made to or for a Participant's or
Beneficiary's benefit, the portion of the amount distributed which
equals the indebtedness will be withheld by the Trustee to apply
against or discharge the indebtedness. Before making a payment,
however, the Participant or Beneficiary must be given written notice
by the Plan Administrator that the indebtedness is to be so paid in
whole or part from his Participant's Accrued Benefit. If the
Participant or Beneficiary does not agree that the indebtedness is a
valid claim against his Vested Accrued Benefit, he will be entitled
to a review of the validity of the claim in accordance with
procedures
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<PAGE> 53
established by the Plan Administrator.
Section 8.02(a) will not apply to a qualified domestic relations
order (QDRO) as defined in Code Section 414(p), and those other
domestic relations orders permitted to be so treated by the Plan
Administrator under the provisions of the Retirement Equity Act of
1984. The Plan Administrator will establish a written procedure to
determine the qualified status of domestic relations orders and to
administer distributions under such qualified orders. Further, to
the extent provided under a QDRO, a former spouse of a Participant
will be treated as the spouse or Surviving Spouse for all purposes
under the Plan. Where, however, because of a QDRO, more than one
individual is to be treated as a Surviving Spouse, the total amount
to be paid in the form of a Qualified Survivor Annuity or the
survivor portion of a Qualified Joint and Survivor Annuity may not
exceed the amount that would be paid if there were only one Surviving
Spouse. All rights and benefits, including elections, provided to a
Participant under this Plan will be subject to the rights afforded to
any alternate payee as such term is defined in Code Section 414(p).
This Plan specifically permits distribution to an alternate payee
under a QDRO (without regard to whether the Participant has attained
his or her earliest retirement age as that term is defined under Code
Section 414(p)) in the same manner that is provided for a Vested
Terminated Participant.
8.03 Qualification of Plan
The Employer will have the sole responsibility for obtaining and
retaining qualification of the Plan under the Code with respect to the
Employer's individual circumstances.
8.04 Construction
To the extent not preempted by ERISA, this Plan will be construed
according to the laws of the state in which the Employer's principal
place of business is located. Words used in the singular will include
the plural, the masculine gender will include the feminine, and vice
versa, whenever appropriate.
8.05 Named Fiduciaries
(a) Allocation of Functions
The authority to control and manage the operation and administration
of the Plan and Trust created by this instrument will be allocated
between the Plan Sponsor, the Trustee, and the Plan Administrator,
all of whom are designated as Named Fiduciaries with respect to the
Plan and Trust as provided for by Section 402(a)(2) of ERISA. The
Plan Sponsor reserves the right to allocate the various
responsibilities for the present execution of the functions of the
Plan, other than the Trustees' responsibilities, among its Named
Fiduciaries. Any person or group of persons may serve in more than
one fiduciary capacity with regard to the Plan.
(b) Responsibilities of the Plan Sponsor
The Plan Sponsor, in its capacity as a Named Fiduciary, will have
only the following authority and responsibility:
-- To appoint or remove the Plan Administrator and furnish the
Trustee with certified copies of any resolutions of the Plan
Sponsor with regard thereto;
-- To appoint and remove the Trustee;
-- To appoint a successor Trustee or additional Trustees;
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-- To communicate information to the Plan Administrator and the
Trustee as needed for the proper performance of the duties of
each;
-- To appoint an investment manager (or to refrain from such
appointment), to monitor the performance of the investment
manager so appointed, and to terminate such appointment (more
than one investment manger may be appointed and in office at any
time); and
-- To establish and communicate to the Trustee a funding policy for
the Plan.
(c) Limitation on Obligations of Named Fiduciaries
No Named Fiduciary will have authority or responsibility to deal with
matters other than as delegated to it under this Plan or by operation
of law. A Named Fiduciary will not in any event be liable for breach
of fiduciary responsibility or obligation by another fiduciary
(including Named Fiduciaries) if the responsibility or authority of
the act or omission deemed to be a breach was not within the scope of
the Named Fiduciary's authority or delegated responsibility.
(d) Standard of Care and Skill
The duties of each fiduciary will be performed with the care, skill,
prudence and diligence under the circumstances then prevailing that a
prudent person acting in a like capacity and familiar with such
matters would use in the conduct of an enterprise of like character
and with like objectives.
8.06 Status of Insurer
The term Insurer refers to any legal reserve life insurance company
licensed to do business in the state within which the Employer maintains
its principal office. The Insurer will file such returns, keep such
records, make such reports and supply such information as required by
applicable law or regulation.
8.07 Adoption and Withdrawal by Other Organizations
(a) Procedure for Adoption
Subject to the provisions of this Section 8.07, any organization now
in existence or hereafter formed or acquired, which is not already a
Participating Employer under this Plan and which is otherwise legally
eligible may, in the future, with the consent and approval of the
Plan Sponsor, by formal Written Resolution (referred to in this
Section as an Adoption Resolution), adopt the Plan and Trust hereby
created for all or any classification of persons in its employment
and thereby, from and after the specified effective date, become a
Participating Employer under this Plan. Such consent will be
effected by and evidenced by a formal Written Resolution of the Plan
Sponsor. The Adoption Resolution may contain such specific changes
and variations in Plan terms and provisions applicable to the
adopting Participating Employer and its Employees as may be
acceptable to the Plan Sponsor and the Trustee. However, the sole,
exclusive right of any other amendment of whatever kind or extent to
the Plan is reserved to the Plan Sponsor. The Adoption Resolution
will become, as to the adopting organization and its Employees, a
part of this Plan as then amended or thereafter amended. It will not
be necessary for the adopting organization to sign or execute the
original or then amended Plan and Trust Agreement or any future
amendment to the Plan and Trust Agreement. The effective date of the
Plan for the adopting organization will be that stated in the
Adoption Resolution and from and after such effective date the
adopting organization will assume all the rights, obligations and
liabilities as a Participating Employer under this Plan. The
administrative powers of and control by the Plan Sponsor as provided
in the Plan, including the sole right of amendment or termination of
the Plan, of appointment and
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removal of the Plan Administrator and the Trustee, and of appointment
and removal of an investment manager will not be diminished by
reason of the participation of the adopting organization in the Plan.
(b) Withdrawal
Any Participating Employer may withdraw from the Plan at any time,
without affecting the Plan Sponsor or other Participating Employers
not withdrawing, by complying with the provisions of the Plan. A
withdrawing Participating Employer may arrange for the continuation
by itself or its successor of this Plan in separate forms for its own
employees, with such amendments, if any, as it may deem proper, and
may arrange for continuation of the Plan by merger with an existing
plan and transfer of plan assets. The Plan Sponsor may, it its
absolute discretion, terminate a Participating Employer's
participation at any time when in its judgment the Participating
Employer fails or refuses to discharge its obligations under the
Plan.
(c) Adoption Contingent Upon Initial and Continued Qualifications
The adoption of this Plan by an organization as provided is hereby
made contingent and subject to the condition precedent that said
adopting organization meets all the statutory requirements for
qualified plans, including, but not limited to, Sections 401(a) and
501(a) of the Internal Revenue Code for its Employees. If the Plan
or the Trust, in its operation, becomes disqualified, for any reason,
as to the adopting organization and its Employees, the portion of
the Plan assets allocable to them will be segregated as soon as is
administratively feasible, pending either the prompt (1)
requalification of the Plan as to the organization and its employees
to the satisfaction of the Internal Revenue Service so as not to
affect the continued qualified status thereof as to other Employers,
(2) withdrawal of the organization from this Plan and a continuation
by itself or its successor of its plan separately from this Plan, or
by merger with another existing plan, with a transfer of its said
segregated portion of Plan assets, or (3) termination of the Plan as
to itself and its Employees.
8.08 Employer Contributions
Employer contributions made to the Plan and Trust are made and will be
held for the sole purpose of providing benefits to Participants and their
Beneficiaries.
In no event will any contribution made by the Employer to the Plan and
Trust or income therefrom revert to the Employer except as provided in
Section 7.01(e) or as provided below.
(a) Any contribution made to the Plan and Trust by the Employer because
of a mistake of fact may be returned to the Employer within one year
of such contribution.
(b) Notwithstanding any other provision of the Plan and Trust, if the
Internal Revenue Service determines initially that the Plan, as
adopted by the Employer, does not qualify under applicable sections
of the Code and applicable Treasury Department Regulations, and the
Employer does not wish to amend this Plan and Trust so that it does
qualify, the value of all assets will be distributed by the Trustee
to the Employer within one year after the date such initial
qualification is denied. Thereafter, the Employer's participation in
this Plan and Trust will be considered rescinded and of no force or
effect.
(c) Any contribution made by the Employer will be conditioned on the
deductibility of such contribution and may be refunded to the
Employer, to the extent the contribution is determined not to be
deductible, within one year after such determination is made.
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ARTICLE 9
ADMINISTRATION
9.01 Plan Administrator
The Plan Administrator will have the responsibility for the general
supervision and administration of the Plan and will be a fiduciary of the
Plan. The Employer may, by Written Resolution, appoint one or more
individuals to serve as Plan Administrator. If the Employer does not
appoint an individual or individuals as Plan Administrator, the Employer
will function as Plan Administrator. The Employer may at any time, with
or without cause, remove an individual as Plan Administrator or
substitute another individual therefor.
9.02 Powers and Duties of the Plan Administrator
The Plan Administrator will be charged with and will have delegated to it
the power, duty, authority and discretion to interpret and construe the
provisions of this Plan, to determine its meaning and intent and to make
application thereof to the facts of any individual case; to determine in
its discretion the rights and benefits of Participants or the eligibility
of Employees; to give necessary instructions and directions to the
Trustee and the Insurer as herein provided or as may be requested by the
Trustee and the Insurer from time to time; to resolve all questions of
fact relating to any of the foregoing; and to generally direct the
administration of the Plan according to its terms. All decisions of the
Plan Administrator in matters properly coming before it according to the
terms of this Plan, and all actions taken by the Plan Administrator in
the proper exercise of its administrative powers, duties and
responsibilities, will be final and binding upon all Employees,
Participants and Beneficiaries and upon any person having or claiming any
rights or interest in this Plan. The Employer and the Plan Administrator
will make and receive any reports and information, and retain any records
necessary or appropriate to the administration of this Plan or to the
performance of duties hereunder or to satisfy any requirements imposed by
law. In the performance of its duties, the Plan Administrator will be
entitled to rely on information duly furnished by any Employee,
Participant or Beneficiary or by the Employer or Trustee.
9.03 Actions of the Plan Administrator
The Plan Administrator may adopt such rules as it deems necessary,
desirable or appropriate with respect to the conduct of its affairs and
the administration of the Plan. Whenever any action to be taken in
accordance with the terms of the Plan requires the consent or approval of
the Plan Administrator, or whenever an interpretation is to be made of
the terms of the Plan, the Plan Administrator will act in a uniform and
non-discriminatory manner, treating all Employees and Participants in
similar circumstances in a like manner. If the Plan Administrator is a
group of individuals, all of its decisions will be made by a majority
vote. The Plan Administrator will have the authority to employ one or
more persons to render advice or services with regard to the
responsibilities of the Plan Administrator, including but not limited to
attorneys, actuaries, and accountants. Any persons employed to render
advice or services will have no fiduciary responsibility for any
ministerial functions performed with respect to this Plan.
9.04 Reliance on Plan Administrator and Employer
Until the Employer gives notice to the contrary, the Trustee and any
persons employed to render advice or services will be entitled to rely on
the designation of Plan Administrator that has been furnished to them.
In addition, the Trustee and any persons employed to render advice or
services will be fully protected in acting upon the written directions
and instructions of the Plan Administrator made in accordance with the
terms of this Plan. If the Plan Administrator is a group of individuals,
unless otherwise specified, any one of such individuals will be
authorized to sign documents on behalf of the Plan Administrator and such
authorized signatures will be recognized by all person dealing with the
Plan Administrator.
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The Trustee and any persons employed to render advice or services may
take cognizance of any rules established by the Plan Administrator and
rely upon them until notified to the contrary. The Trustee and any
persons employed to render advice or services will be fully protected in
taking any action upon any paper or document believed to be genuine and
to have been properly signed and presented by the Plan Administrator,
Employer or any agent of the Plan Administrator acting on behalf of the
Plan Administrator.
9.05 Reports to Participants
The Plan Administrator will report in writing to a Participant his
Accrued Benefit under the Plan and the Vested Percentage of such benefit
when the Participant terminates his employment or requests such a report
in writing from the Plan Administrator. To the extent required by law or
regulation, the Plan Administrator will annually furnish to each
Participant, and to each Beneficiary receiving benefits, a report which
fairly summarizes the Plan's most recent report.
9.06 Bond
The Plan Administrator and other fiduciaries of the Plan will be bonded
to the extent required by ERISA or other applicable law. No additional
bond or other security for the faithful performance of any duties under
this Plan will be required.
9.07 Compensation of Plan Administrator
The Compensation of the Plan Administrator will be left to the discretion
of the Plan Sponsor; no person who is receiving full pay from the
Employer will receive compensation for services as Plan Administrator.
All reasonable and necessary expenses incurred by the Plan Administrator
in supervising and administering the Plan will be paid from the Plan
assets by the Trustee at the direction of the Plan Administrator to the
extent not paid by the Plan Sponsor.
9.08 Claims Procedure
The Plan Administrator will make all determinations as to the rights of
any Employee, Participant, Beneficiary or other person under the terms of
this Plan. Any Employee, Participant or Beneficiary, or person claiming
under them, may make claim for benefit under this Plan by filing written
notice with the Plan Administrator setting forth the substance of the
claim. If a claim is wholly or partially denied, the claimant will have
the opportunity to appeal the denial upon filing with the Plan
Administrator a written request for review within 60 days after receipt
of notice of denial. In making an appeal the claimant may examine
pertinent Plan documents and may submit issues and comments in writing.
Denial of a claim or a decision on review will be made in writing by the
Plan Administrator delivered to the claimant within 60 days after receipt
of the claim or request for review, unless special circumstances require
an extension of time for processing the claim or review, in which event
the Plan Administrator's decision must be made as soon as possible
thereafter but not beyond an additional 60 days. If no action on an
initial claim is taken within 120 days, the claims will be deemed denied
for purposes of permitting the claimant to proceed to the review stage.
The denial of a claim or the decision on review will specify the reasons
for the denial or decision and will make reference to the pertinent Plan
provisions upon which the denial or decision is based. The denial of a
claim will also include a description of any additional material or
information necessary for the claimant to perfect the claim and an
explanation of the claim review procedure herein described. The Plan
Administrator will serve as an agent for service of legal process with
respect to the Plan unless the Employer, through written resolution,
appoints another agent.
If a Participant or Beneficiary is entitled to a distribution from the
Plan, the Participant or Beneficiary will be responsible for providing
the Plan Administrator with his current address. If the Plan
Administrator notifies the Participant or Beneficiary by registered mail
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(return receipt requested) at his last known address that he is entitled
to a distribution and also notifies him of the provisions of this
paragraph, and the Participant or Beneficiary fails to claim his benefits
under the Plan or provide his current address to the Plan Administrator
within one year after such notification, the distributable amount will be
forfeited and used to reduce the cost of the Plan. If the Participant or
Beneficiary is subsequently located, such benefit will be restored.
9.09 Liability of Fiduciaries
Except for a breach of fiduciary responsibility due to gross negligence
or willful misconduct, the Plan Administrator will not incur any
individual liability for any decision, act, or failure to act hereunder.
The Plan Administrator may engage agents to assist it and may engage
legal counsel who may be counsel for the Employer. The Plan
Administrator will not be responsible for any action taken or omitted to
be taken on the advice of counsel.
If there is more than one person serving as a fiduciary in any capacity
(for example, co-Trustees), each will use reasonable care to prevent the
other or others from committing a breach of this Plan. Nothing contained
in this Section will preclude any agreement allocating specific
responsibilities or obligations among the co-fiduciaries provided that
the agreement does not violate any of the terms and provisions of this
Plan. In those instances where any duties have been allocated between
co-fiduciaries, a fiduciary will not be liable for any loss resulting to
the Plan arising from any act or omission on the part of another
co-fiduciary to whom responsibilities or obligations have been allocated
except under the following circumstances:
-- If he participates knowingly in, or knowingly undertakes to conceal,
an act or omission of a co-fiduciary knowing the act or omission is a
breach; or
-- If by his failure to comply with his specific responsibilities which
give rise to his status as a fiduciary, he has enabled the other
fiduciary to commit a breach; or
-- If he has knowledge of a breach by a co-fiduciary, unless he makes
reasonable efforts under the circumstances to remedy the breach.
9.10 Expenses of Administration
The Employer does not and will not guarantee the Plan assets against
loss. The Employer may in its sole discretion, but will not be obligated
to, pay the ordinary expenses of establishing the Plan, including the
fees of consultants, accountants and attorneys in connection therewith.
The Employer may, in its sole discretion (but will not be obligated to),
pay other costs and expenses of administering the Plan, the taxes imposed
upon the Plan, if any, and the fees, charges or commissions with respect
to the purchase and sale of Plan assets. Unless paid by the Employer,
such costs and expenses, taxes (if any), and fees, charges and
commissions will be a charge upon Plan assets and deducted by the
Trustee.
9.11 Distribution Authority
If any person entitled to receive payment under this Plan is a minor,
declared incompetent or is under other legal disability, the Plan
Administrator may, in its sole discretion, direct the Trustee to:
-- Distribute directly to the person entitled to the payment;
-- Distribute to the legal guardian or, if none, to a parent of the
person entitled to payment or to a responsible adult with whom the
person entitled to payment maintains his residence;
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-- Distribute to a custodian for the person entitled to payment under
the Uniform Gifts to Minors Act if permitted by the laws of the state
in which the person entitled to payment resides; or
-- Withhold distribution of the amount payable until a court of
competent jurisdiction determines the rights of the parties thereto
or appoints a guardian of the estate of the person entitled to
payment.
If there is any dispute, controversy or disagreement between any
Beneficiary or person and any other person as to who is entitled to
receive the benefits payable under this Plan, or if the Plan
Administrator is uncertain as to who is entitled to receive benefits, or
if the Plan Administrator is unable to locate the person who is entitled
to benefits, the Plan Administrator may with acquittance interplead the
funds into a court of competent jurisdiction in the judicial district in
which the Employer maintains its principal place of business and, upon
depositing the funds with the clerk of the court, be released from any
further responsibility for the payment of the benefits. If it is
necessary for the Plan Administrator to retain legal counsel or incur any
expense in determining who is entitled to receive the benefits, whether
or not it is necessary to institute court action, the Plan Administrator
will be entitled to reimbursement from the benefits for the amount of its
reasonable costs, expenses and attorneys' fees incurred.
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ARTICLE 10
AMENDMENT OR TERMINATION OF PLAN
10.01 Right of Plan Sponsor to Amend or Terminate
The Plan Sponsor reserves the right to alter, amend, revoke or terminate
this Plan. No amendment will deprive any Participant or Beneficiary of
any vested right nor will it reduce the present value (determined upon
an actuarial equivalent basis) of any Accrued Benefit to which he is
then entitled with respect to Employer contributions previously made,
except as may be required to maintain the Plan as a qualified plan under
the Code. No amendment will change the duties or responsibilities of
the Trustee without its express written consent thereto.
A plan amendment which has the effect of (a) eliminating or reducing an
early retirement benefit or a retirement-type subsidy, or (b)
eliminating an optional benefit form, will, with respect to benefits
attributable to service before the amendment be treated as reducing
Accrued Benefits. In the case of a retirement-type subsidy, the
preceding sentence will apply only with respect to a Participant who
satisfies (either before or after the amendment) the preamendment
conditions for the subsidy. In general, a retirement-type subsidy is a
subsidy that continues after retirement but does not include a
disability retirement benefit, a medical benefit, a social security
supplement, a pre-retirement death benefit, or a plant shutdown benefit
(that does not continue after retirement).
A minimum Accrued Benefit value will apply if this Plan is or becomes a
successor to a profit sharing plan, a defined contribution pension plan,
a target benefit plan, or a defined benefit pension plan which was fully
insured, or any plan under which the accrued benefit of a Participant
was determined as a lump sum or account balance. The actuarial
equivalent value of a Participant's Accrued Benefit will not be less
than the actuarial equivalent value of his Accrued Benefit on the
Effective Date of the Plan.
10.02 Allocation of Assets Upon Termination of Plan
If this Plan is revoked or terminated (in whole or in part) or if
contributions are completely discontinued the Accounts of all affected
Participants will become non-forfeitable. The Employer will then
arrange for allocation of all assets among Participants so affected by
the total or partial termination in accordance with the requirements of
all applicable law and the regulations and requirements of the Internal
Revenue Service. All allocated amounts will be retained in the Plan to
the credit of the individual Participants until distribution as directed
by the Employer. Distribution to Participants may be in the form of
cash or other Plan assets or partly in each.
10.03 Exclusive Benefit
At no time will any part of the principal or income of the Plan assets
be used or diverted for purposes other than the exclusive benefit of
Participants in the Plan and their Beneficiaries, nor may any portion of
the Plan assets revert to the Employer except as provided in Sections
7.01(e) and 8.08.
10.04 Failure to Qualify
Notwithstanding any of the foregoing provisions, if this Plan, upon
adoption by the Employer, is submitted to the Internal Revenue Service
which then determines that the Plan as initially adopted by the Employer
is not a qualified plan under the Code, the Employer may elect to
terminate this Plan by giving written notice thereof. Such termination
will have the same effect as if the Plan were never adopted, all
policies and contracts will be cancelled, and all contributions, to the
extent recoverable from the Trustee, will be returned to their
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source. If any amendment to this Plan is submitted to the Internal
Revenue Service within the period allowed under Code Section 401(b)
which then determines that the Plan as amended is not a qualified plan
under the Code, the Employer may cancel or modify any or all provisions
of the amendment retroactive to the effective date of the amendment in
order to maintain the qualified status of the Plan, whereupon written
notice thereof will be furnished to all affected Employees, Participants
and Beneficiaries.
10.05 Mergers, Consolidations or Transfers of Plan Assets
In the event this Plan is merged or consolidated with another plan which
is qualified under Code Sections 401(a) (and 501(a) if applicable), or
in the event of a transfer of the assets or liabilities of this Plan to
another plan which is qualified under Code Sections 401(a) (and 501(a)
if applicable), the benefit which each Participant would be entitled to
receive under the successor plan or other plan if it were terminated
immediately after the merger, consolidation or transfer will be equal to
or greater than the benefit which the Participant would have received
immediately before the merger, consolidation or transfer if this Plan
had then terminated.
Any transfer of assets and/or liabilities to (or from) this Plan from
(or to) another plan qualified under Code Sections 401(a) (and 501(a) if
applicable) will be evidenced by a Written Resolution by the Plan
Sponsor of each affected plan which specifically authorizes such
transfer of assets and/or liabilities.
Any transfer of assets to this Plan will be allowed under the provisions
of this Section if such transferred assets are not required to be paid
in the form of a qualified joint & survivor annuity or a qualified
survivor annuity in accordance with Code Section 401(a)(11).
10.06 Effect of Plan Amendment on Vesting Schedule
No amendment to the Vesting Schedule will deprive a Participant of his
nonforfeitable right to his Vested Accrued Benefit as of the date of the
amendment. Further, if the Vesting Schedule of the Plan is amended, or
if the Plan is amended in any way that directly or indirectly affects
the computation of a Participant's non-forfeitable percentage, each
Participant with at least 3 Years of Service as of the last day of the
election period described below may elect, within a reasonable period
after the adoption of the amendment, to have his Vested Percentage
computed under the Plan without regard to such amendment. The period
during which such election may be made will commence with the date the
amendment is adopted and will end 60 days after the latest of:
(a) the date the amendment is adopted;
(b) the date the amendment becomes effective; or
(c) the date the Participant is issued written notice of the amendment
by the Employer.
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ARTICLE 11
TRUSTEE AND TRUST FUND
11.01 Acceptance of Trust
The Trustee, by signing this Agreement, accepts this Trust and agrees to
perform the duties of the Trustee in accordance with the terms and
conditions set forth herein.
11.02 Trust Fund
(a) Purpose and Nature
The Trustee will establish and maintain a Trust Fund for purposes of
providing a means of accumulating the assets necessary to provide
the benefits which become payable under the Plan. The Trustee will
receive, hold and invest all contributions made by the Employer, any
Participating Employers, and the Participants, including the
investment earnings thereon. The Trust Fund arising from such
contributions and earnings will consist of all assets held by the
Trustee under the Plan and Trust. All benefits payable under the
Plan will be paid by the Trustee from the Trust Fund.
Any person having any claim under the Plan will look solely to the
assets of the Trust Fund for satisfaction. In no event will the
Plan Administrator, the Employer, any Employees, any officer of the
Employer or any agents of the Employer or the Plan Administrator be
liable in their individual capacities to any person whomsoever,
under the provisions of this Plan and Trust, except as provided by
law.
The Trust Fund will be used and applied only in accordance with the
provisions of the Plan and Trust, to provide the benefits thereof,
and no part of the corpus or income of the Trust Fund will be used
for, or diverted to, purposes other than for the exclusive benefit
of the Participants or their Beneficiaries entitled to benefits
under the Plan, except to the extent specifically provided elsewhere
herein.
(b) Investments
The Trustee will invest the Trust Fund in accordance with the
investment policy for the Trust Fund considering the fiduciary
requirements of law, the objectives of the Plan, and the liquidity
needs of the Plan.
(c) Investment Policy
The Plan Sponsor (or the Plan Administrator or an Investment
Committee appointed by the Plan Sponsor) will have the right to
periodically provide the Trustee with a written investment policy
which, in consideration of the needs of the Plan, sets forth the
investment objectives, policies, and guidelines which the Plan
Sponsor judges to be appropriate and prudent.
If a written investment policy is not so provided, then the Trustee
will set forth the investment policy for the Plan. In doing so, the
Trustee may consult with the Plan Sponsor (or the Plan Administrator
or an Investment Committee appointed by the Plan Sponsor) to secure
information with regard to Plan Sponsor investment objectives and
general investment policy.
(d) Operation of Trust Fund
The Trust Fund will be maintained in accordance with the accounting
requirements of the Plan. No Participant will have any right to any
specific asset or any specific portion of the Trust Fund prior to
distribution of benefits. Withdrawals from the Trust Fund
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will be made to provide benefits to Participants and Beneficiaries
in the amounts specified by the Plan, and to pay expenses authorized
by the Plan Administrator.
(e) Plan Sponsor Direction of Investment
The Plan Sponsor will have the right to direct the Trustee with
respect to the investment and reinvestment of assets comprising the
Trust Fund. In particular, the Employer shall direct the Trustee,
and the Trustee shall be subject to the direction of the Employer,
as to the acquisition, holding or disposition of any stock of TCA
Cable TV, Inc. The Trustee and the Plan Sponsor (or the Plan
Administrator or an Investment Committee appointed by the Plan
Sponsor) may execute a letter of agreement as a part of this Plan
containing conditions, limitations and other provisions with respect
to Plan Sponsor direction of the investment or reinvestment of any
part of the Trust Fund.
11.03 Receipt of Contributions
The Trustee will be accountable to the Employer for the funds
contributed to it, but will have no duty to see that the contributions
received comply with the provisions of the Plan. The Trustee will not
be obligated to collect any contributions from the Employer or the
Participants.
11.04 Powers of the Trustee
Subject to the provisions and limitations contained elsewhere in this
Plan, the Trustee will have full discretion and authority with regard to
the investment of the Trust Fund. The Trustee is authorized and
empowered, but not by way of limitation, with the following powers,
rights and duties:
(a) To invest any part or all of the Trust Fund in any common or
preferred stocks, open-end or closed-end mutual funds, United States
retirement plan bonds, corporate bonds, debentures, convertible
debentures, commercial paper, U.S. Treasury bills, book entry
deposits with the United States Federal Reserve Bank or System,
Master Notes or similar arrangements sponsored by the Trustee or any
other financial institution as permitted by law, improved or
unimproved real estate situated in the United States, mortgages,
notes or other property of any kind, real or personal, as a prudent
man would so invest under like circumstances with due regard for the
purposes of this Plan;
(b) To maintain any part of the assets of the Trust Fund in cash, or in
demand or short-term time deposits bearing a reasonable rate of
interest (including demand or short-term time deposits of or with
the Trustee), or in a short-term investment fund or in other cash
equivalents having ready marketability, including, but not limited
to, U.S. Treasury Bills, commercial paper, certificates of deposit
(including such certificates of deposit of or with the Trustee), and
similar types of short-term securities, as may be deemed necessary
by the Trustee in its sole discretion;
(c) To manage, sell, contract to sell, grant options to purchase,
convey, exchange, transfer, abandon, improve, repair, insure, lease
for any term even though commencing in the future or extending
beyond the term of the Trust, and otherwise deal with all property,
real or personal, in such manner, for such considerations and on
such terms and conditions as the Trustee will decide;
(d) To credit and distribute the Trust as directed by the Plan
Administrator or any agent of the Plan Administrator. The Trustee
will not be obliged to inquire as to whether any payee or
distributee is entitled to any payment or whether the distribution
is proper or within the terms of the Plan, or as to the manner of
making any payment or distribution. The Trustee will be accountable
only to the Plan Administrator for any payment or distribution made
by it in good faith on the order or direction of the Plan
Administrator
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or any agent of the Plan Administrator;
(e) To borrow money, assume indebtedness, extend mortgages and encumber
by mortgage or pledge;
(f) To compromise, contest, arbitrate, or abandon claims and demands, in
its discretion;
(g) To have with respect to the Trust all of the rights of an individual
owner, including the power to give proxies, to participate in any
voting trusts, mergers, consolidations or liquidations, and to
exercise or sell stock subscriptions or conversion rights;
(h) To hold any securities or other property in the name of the Trustee
or its nominee, or in another form as it may deem best, with or
without disclosing the trust relationship;
(i) To perform any and all other acts in its judgment necessary or
appropriate for the proper and advantageous management, investment
and distribution of the Trust;
(j) To retain any funds or property subject to any dispute without
liability for the payment of interest, and to decline to make
payment or delivery of the funds or property until final
adjudication is made by a court of competent jurisdiction;
(k) To file all tax forms or returns required of the Trustee;
(l) To begin, maintain or defend any litigation necessary in connection
with the administration of the Plan, except that the Trustee will
not be obligated to or required to do so unless indemnified to its
satisfaction; and
(m) To keep any or all of the Trust property at any place or places
within the United States or abroad, or with a depository or
custodian at such place or places; provided, however, that the
Trustee may not maintain the indicia of ownership of any assets of
the Plan outside the jurisdiction of the District Courts of the
United States, except as may be expressly authorized in U.S.
Treasury or U.S. Department of Labor regulations.
11.05 Investment in Common or Collective Trust Funds
Notwithstanding the provisions of Section 11.04, the Plan Sponsor
specifically authorizes the Trustee to invest all or any portion of the
assets comprising the Trust Fund in any common or collective trust fund
which at the time of the investment provides for the pooling of the
assets of plans qualified under Code Section 401(a). The authorization
applies only if such common or collective trust fund: (a) is exempt from
taxation under Code Section 584 or 501(a); (b) if exempt under Code
Section 501(a), expressly limits participation to pension and profit
sharing trusts which are exempt under Code Section 501(a) by reason of
qualifying under Code Section 401(a); (c) prohibits that part of its
corpus or income which equitably belongs to any participating trust from
being used for or diverted to any purposes other than for the exclusive
benefit of the Employees or their Beneficiaries who are entitled to
benefits under such participating trust; (d) prohibits assignment by
participating trust of any part of its equity or interest in the group
trust; and (e) the sponsor of the group trust created or organized the
group trust in the United States and maintains the group trust at all
times as a domestic trust in the United States. The provisions of the
common or collective trust fund agreement, as amended by the Trustee
from time to time, are by this reference incorporated within this Plan
and Trust. The provisions of the common or collective trust fund will
govern any investment of Plan assets in that fund. This provision
constitutes the express permission required by Section 408(b)(8) of
ERISA.
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11.06 Investment in Insurance Company Contracts
The Trustee may invest any portion of the Trust Fund in a deposit
administration, guaranteed investment or similar type of investment
contract (hereinafter referred to as Contract); provided, however, that
no such Contract may provide for an optional form of benefit which would
not be provided for under the provisions hereof. The Trustee will be
the complete and absolute owner of Contracts held in the Trust Fund.
The Trustee may convert from one form to another any Contract held in
the Trust Fund; designate any mode of settlement; sell or assign any
Contract held in the Trust Fund; surrender for cash any Contract held in
the Trust Fund; agree with the insurance company issuing any Contract to
any release, reduction, modification or amendment thereof; and, without
limitation of any of the foregoing, exercise any and all of the rights,
options and privileges that belong to the absolute owner of any Contract
held in the Trust Fund that are granted by the terms of any such
Contract or by the terms of this Agreement.
The Trustee will hold in the Trust Fund the proceeds of any sale,
assignment or surrender of any Contract held in the Trust Fund and any
and all dividends and other payments of any kind received in respect to
any Contract held in the Trust Fund.
No insurance company which may issue any Contract based upon the
application of the Trustee will be responsible for the validity of this
Plan, be required to look into the terms of this Plan, be required to
question any act of the Plan Administrator or the Trustee hereunder or
be required to verify that any action of the Trustee is authorized by
this Plan. If a conflict should arise between the terms of the Plan and
any such Contract, the terms of the Plan will govern.
11.07 Fees and Expenses from Fund
The Trustee will be entitled to receive reasonable annual compensation
as may be mutually agreed upon from time to time between the Plan
Sponsor and the Trustee. The Trustee will pay all expenses reasonably
incurred by it in its administration and investment of the Trust Fund
from the Trust Fund unless the Plan Sponsor pays the expenses. No
person who is receiving full pay from the Plan Sponsor will receive
compensation for services as Trustee.
11.08 Records and Accounting
The Trustee will keep full and complete records of the administration of
the Trust Fund which the Employer and the Plan Administrator may examine
at any reasonable time. As soon as practical after the end of each Plan
Year and at such other reasonable times as the Employer may direct, the
Trustee will prepare and deliver to the Employer and the Plan
Administrator an accounting of the administration of the Trust,
including a report on the valuation of all assets of the Trust Fund,
such valuation to be based upon the fair market value on the valuation
date.
11.09 Distribution Directions
If no one claims a payment or distribution made from the Trust, the
Trustee will notify the Plan Administrator and will dispose of the
payment in accordance with the subsequent direction of the Plan
Administrator.
11.10 Third Party
No person dealing with the Trustee will be obliged to see to the proper
application of any money paid or property delivered to the Trustee, or
to inquire whether the Trustee has acted pursuant to any of the terms of
the Plan. Each person dealing with the Trustee may act upon any notice,
request or representation in writing by the Trustee, or by the Trustee's
duly authorized agent, and will not be liable to any person whomsoever
in so doing. The certification of the Trustee that it is acting in
accordance with the Plan will be conclusive
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in favor of any person relying on the certification.
11.11 Professional Agents
The Trustee may employ and pay from the Trust Fund reasonable
compensation to agents, attorneys, accountants and other persons to
advise the Trustee as in its opinion may be necessary. The Trustee may
delegate to any agent, attorney, accountant or other person selected by
it any non-Trustee power or duty vested in it by the Plan; the Trustee
may act or refrain from acting on the advice or opinion of any agent,
attorney, accountant or other person so selected.
11.12 Valuation of Trust
The Trustee will value the Trust Fund as of the last day of each Plan
Year to determine the fair market value of the Trust, and the Trustee
will value the Trust Fund on such other date(s) as may be necessary to
carry out the provisions of the Plan.
11.13 Liability of Trustee
The Trustee will be liable only for the safeguarding and administration
of the assets of this Trust Fund in accordance with the provisions
hereof and any amendments hereto and no other duties or responsibilities
will be implied. The Trustee will not be required to pay any interest
on funds paid to or deposited with it or to its credit under the
provisions of this Trust, unless pursuant to a written agreement between
the Employer and the Trustee. The Trustee will not be responsible for
the adequacy of the Trust Fund to meet and discharge any liabilities
under the Plan and will not be required to make any payment of any
nature except from funds actually received as Trustee. The Trustee may
consult with legal counsel (who may be legal counsel for the Employer)
selected by the Trustee and will be fully protected for any action
taken, suffered or omitted in good faith in accordance with the opinion
of said legal counsel. It will not be the duty of the Trustee to
determine the identity or mailing address of any Participant or any
other person entitled to benefits hereunder, such identity and mailing
addresses to be furnished by the Employer, the Plan Administrator or an
agent of the Plan Administrator. The Trustee will be under no liability
in making payments in accordance with the terms of this Plan and the
certification of the Plan Administrator or an agent of the Plan
Administrator who has been granted such powers by the Plan
Administrator.
Except to the extent required by any applicable law, no bond or other
security for the faithful performance of duty hereunder will be required
of the Trustee.
11.14 Removal or Resignation and Successor Trustee
A Trustee may resign at any time upon giving 30 days prior written
notice to the Plan Sponsor or, with the consent of the Plan Sponsor, a
Trustee may resign with less than 30 days prior written notice.
The Plan Sponsor may remove a Trustee by giving at least 30 days prior
written notice to the Trustee.
Upon the removal or resignation of a Trustee, the Plan Sponsor will
appoint and designate a successor Trustee which will be one or more
individual successor Trustees or a corporate Trustee organized under the
laws of the United Sates or of any state thereof with authority to
accept and execute trusts. Any successor Trustee must accept and
acknowledge in writing its appointment as a successor Trustee before it
can act in such capacity.
Title to all property and records or true copies of such records
necessary to the current operation of the Trust Fund held by the Trustee
hereunder will vest in any successor Trustee acting pursuant to the
provisions hereof, without the execution or filing of any further
instrument. Any resigning or removed Trustee will execute all
instruments and do all acts
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necessary to vest such title in any successor Trustee of record. Each
successor Trustee will have, exercise and enjoy all the powers, both
discretionary and ministerial, herein conferred upon his predecessor.
No successor Trustee will be obligated to examine the accounts, records
and acts of any previous Trustee or Trustees, and each successor Trustee
in no way or manner will be responsible for any action or omission to
act on the part of any previous Trustee.
Any corporation which results from any merger, consolidation or purchase
to which the Trustee may be a party, or which succeeds to the trust
business of the Trustee, or to which substantially all the trust assets
of the Trustee may be transferred, will be the successor to the Trustee
hereunder without any further act or formality with like effect as if
the successor Trustee had originally been named Trustee herein; and in
any such event it will not be necessary for the Trustee or any successor
Trustee to give notice thereof to any person, and any requirement,
statutory or otherwise, that notice will be given is hereby waived.
11.15 Appointment of Investment Manager
One or more Investment Managers may be appointed by the Plan Sponsor (or
the Plan Administrator) to exercise full investment management authority
with respect to all or a portion of the Trust assets. Authorized
payment of the fees and expenses of the Investment Manager(s) may be
made from the Trust assets. For purposes of this agreement, any
Investment Manager so appointed will, during the period of his
appointment, possess fully and absolutely those powers, rights and
duties of the Trustee (to the extent delegated by the Plan Sponsor or
the Plan Administrator) with respect to the investment or reinvestment
of that portion of the Trust assets over which the Investment Manager
has investment management authority. The Investment Manager must be one
of the following:
(a) Registered as an investment advisor under the Investment Advisors
Act of 1940;
(b) A bank, as defined in the Investment Advisors Act of 1940; or
(c) An insurance company qualified to manage, acquire, or dispose of
such Plan assets under the laws of more than one state.
Any Investment Manager will acknowledge in writing to the Plan Sponsor
or the Plan Administrator and to the Trustee that he or it is a
fiduciary with respect to the Plan. During any period of time when the
Investment Manager is so appointed and serving, and with respect to
those assets in the Plan over which the Investment Manager exercises
investment management authority, the Trustee's responsibility will be
limited to holding such assets as a custodian, providing accounting
services, disbursing benefits as authorized, and executing such
investment instructions only as directed by the Investment Manager. The
Trustee will not be responsible for any acts or omissions of the
Investment Manager. Any certificates or other instruments duly signed
by the Investment Manager (or the authorized representative of the
Investment Manager), purporting to evidence any instruction, direction
or order of the Investment Manager with respect to the investment of
those assets of the Plan over which the Investment Manager has
investment management authority, will be accepted by the Trustee as
conclusive proof thereof. The Trustee will also be fully protected in
acting in good faith upon any notice, instruction, direction, order,
certificate, opinion, letter, telegram or other document believed by the
Trustee to be genuine and from the Investment Manager (or the authorized
representative of the Investment Manager). The Trustee will not be
liable for any action taken or omitted by the Investment Manager or for
any mistakes of judgment or other action made, taken or omitted by the
Trustee in good faith upon direction of the Investment Manager.
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IN WITNESS WHEREOF, this instrument has been executed by the duly authorized
and empowered officers of the Employer, this 27th day of October 1993.
TCA Management Company
By: /s/ Fred R. Nichols
Fred R. Nichols, President
The Trustees agree to continue to serve as Trustees under the terms of this
instrument.
/s/ Robert M. Rogers
Robert M. Rogers, Trustee
/s/ Fred R. Nichols
Fred R. Nichols, Trustee
/s/ Jimmie F. Taylor
Jimmie F. Taylor, Trustee
/s/ Jerry P. Yandell
Jerry P. Yandell, Trustee
