<PAGE> 1
As filed with the Securities and Exchange Commission on January 8, 1999
Registration No. 333-12183
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
POST-EFFECTIVE AMENDMENT NO. 1
TO
FORM S-8
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
SCOTT TECHNOLOGIES, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 52-1297376
(State or Other Jurisdiction of (I.R.S. Employer Identification No.)
Incorporation or Organization)
5875 Landerbrook Drive, Suite 250
Mayfield Heights, Ohio 44124
(Address of Principal Executive Offices, Including Zip Code)
----------------------
SCOTT TECHNOLOGIES, INC. 401(k) SAVINGS PLAN FOR HOURLY PAID EMPLOYEES
(Full Title of the Plan)
Copy to:
Debra L. Kackley, Esq. Douglas A. Neary, Esq.
Vice President, General Counsel and Calfee, Halter & Griswold LLP
Corporate Secretary 1400 McDonald Investment Center
Scott Technologies, Inc. 800 Superior Avenue
5875 Landerbrook Drive, Suite 250 Cleveland, Ohio 44114
Mayfield Heights, Ohio 44124 (216) 622-8200
(440) 446-1333
(Name, Address and Telephone Number, Including Area Code, of Agent For Service)
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------------------
Title Of
Securities Amount Proposed Maximum Proposed Maximum Amount Of
To Be To Be Offering Price Per Aggregate Offering Registration
Registered Registered Share Price Fee
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Interests In Plan ................... N/A N/A N/A (1)
- ---------------------------------------------------------------------------------------------------------------------------
Common Stock, par value $.10 per
share (2) ........................... N/A N/A N/A (1)
- ---------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) This post-effective amendment is being filed to reflect certain amendments
that Scott Technologies, Inc. has made to its capital structure and to the
Scott Technologies, Inc. 401(k) Savings Plan for Hourly Paid Employees (the
"Plan") and for the purpose of updating certain exhibits. No additional
securities are being registered for offers or sales under the Plan.
Therefore, pursuant to Rule 457(a) under the Securities Act of 1933, no fee
is required.
(2) On December 15, 1998, Scott Technologies, Inc. amended provisions of its
Certificate of Incorporation to eliminate the Class A Common Stock and
Class B Common Stock and to provide for the reclassification and conversion
of such classes into one class, designated "Common Stock." The 250,000
shares of Class A Common Stock and the 250,000 shares of Class B Common
Stock previously registered on Form S-8 (Commission File No. 333-12183)
have been reclassified into an aggregate of 500,000 shares of Common Stock.
<PAGE> 2
This Amendment No. 1 hereby amends Registration Statement on Form S-8
(Commission File No. 333-12183) (the "Registration Statement") for the following
purposes:
(1) to reflect the Company's December 15, 1998 amendment of its
Certificate of Incorporation that eliminated provisions
relating to Class A Common Stock and Class B Common Stock,
provided for a single class of new Common Stock designated
"Common Stock" and provided for the reclassification and
conversion of the previously issued shares of Class A Common
Stock and Class B Common Stock into the newly designated
Common Stock;
(2) to reflect the change in the name of the plan from "Figgie
International Inc. 401(k) Savings Plan for Hourly Paid
Employees" to "Scott Technologies, Inc. 401(k) Savings Plan
for Hourly Paid Employees;"
(3) to file an updated Power of Attorney at Exhibit 24.1.
Pursuant to General Instruction E to Form S-8, the remaining contents
of the Registration Statement are hereby incorporated by reference.
Any statement contained in a document incorporated or deemed to be
incorporated by reference in this Amendment No. 1 shall be deemed to be modified
or superseded for purposes of this Amendment No. 1 to the extent that a
statement contained in this Amendment No. 1 or in any other subsequently filed
document that also is, or is deemed to be, incorporated by reference in this
Amendment No. 1 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 Amendment No. 1.
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933,
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 Mayfield Heights, State of Ohio, this 8th day of
January, 1999.
SCOTT TECHNOLOGIES, INC.
By: /s/ Glen W. Lindemann
--------------------------------------
Glen W. Lindemann,
President and Chief Executive Officer
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned,
being a director or officer, or both of Scott Technologies, Inc., a Delaware
corporation, hereby constitutes and appoints Glen W. Lindemann, Mark A. Kirk,
Debra L. Kackley and Douglas A. Neary, and each of them, his true and lawful
attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign any and all amendments (including post-effective amendments)
to this Registration Statement, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorneys-in-fact and agents, and each of them,
full power, and authority to do and perform each and every act and thing
requisite, necessary or advisable to be done, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, or their or his
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933,
this Registration Statement has been signed below by the following persons in
the capacities indicated on January 8, 1999.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Glen W. Lindemann President and Chief Executive Officer
- ----------------------------------- (Principal Executive Officer)
Glen W. Lindemann
/s/ Mark A. Kirk Senior Vice President and Chief Financial Officer
- ----------------------------------- (Principal Financial Officer)
Mark A. Kirk
/s/ Robert P. Collins
- ----------------------------------- Chairman of the Board and Director
Robert P. Collins
/s/ John P. Reilly Director
- -----------------------------------
John P. Reilly
/s/ Harrison Nesbit, II Director
- -----------------------------------
Harrison Nesbit, II
/s/ Frank N. Linsalata Director
- -----------------------------------
Frank N. Linsalata
</TABLE>
<PAGE> 4
<TABLE>
<S> <C>
/s/ F. Rush McKnight Director
- -----------------------------------
F. Rush McKnight
/s/ N. Colin Lind Director
- -----------------------------------
N. Colin Lind
</TABLE>
<PAGE> 5
Pursuant to the requirements of the Securities Act of 1933,
the trustee has duly caused this Registration Statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Wilmington,
State of Delaware, on January 8, 1999.
SCOTT TECHNOLOGIES, INC. 401(k) SAVINGS
PLAN FOR HOURLY PAID EMPLOYEES
By: Wilmington Trust Company,
Trustee
By: /s/ Linda Bailey
---------------------------------
Linda Bailey,
Senior Financial Services Officer
<PAGE> 6
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit Number Description
-------------- -----------
<S> <C> <C>
3.1 Amended and Restated Certificate of Incorporation. (1)
3.1.1 Certificate of Designations, Preferences, Related (2)
Rights, Qualifications, Limitations and
Restrictions of Series A Junior Participating
Preferred Shares.
3.2 Amended and Restated By-Laws of the Company. (3)
4 Rights Agreement, dated as of December 15, 1998, (4)
between Scott Technologies, Inc. and National City
Bank, as Rights Agent.
4.1 Scott Technologies, Inc. 401(k) Savings Plan for
Hourly Paid Employees.
4.2 Indenture, dated as of October 1, 1989, between (5)
Figgie International Inc. (n/k/a Scott
Technologies, Inc.) and Continental Bank, National
Association (n/k/a State Street Trust), as
Trustee, with respect to the 9.875% Senior
Notes due October 1, 1999.
4.3 Second Supplemental Indenture, dated as of (6)
December 31, 1986, among Figgie International Inc.
(n/k/a Scott Technologies, Inc.) and Marine
Midland Bank, N.A., as Trustee, with respect to
the 10.375% Subordinated Debentures due April 1,
1998.
4.4 First Supplemental Indenture, dated as of July 18, (7)
1983, among Figgie International Inc., (n/k/a
Scott Technologies, Inc.) Figgie International
Holdings Inc., and Marine Midland Bank, N.A., as
Trustee with respect to the 10-3/8% Subordinated
Debentures due 1998, along with the Original
Indenture dated as of April 1, 1978.
+5.1 Opinion of Calfee, Halter & Griswold LLP
regarding the validity of the securities being
registered.
23.1 Consent of Arthur Andersen LLP.
+23.2 Consent of Calfee, Halter & Griswold LLP.
24.1 Power of Attorney and related Certified Resolution.
</TABLE>
- ---------------
+ Previously filed.
(1) Incorporated herein by reference to Exhibit 3.1 of the Company's
Current Report on Form 8-K, dated December 15, 1998 (File No. 1-8591).
<PAGE> 7
(2) Incorporated herein by reference to Exhibit 3.1.1 of the Company's
Current Report on Form 8-K, dated December 15, 1998 (File No. 1-8591).
(3) Incorporated herein by reference to Exhibit 3.2 of the Company's
Current Report on Form 8-K, dated December 15, 1998 (File No. 1-8591).
(4) Incorporated herein by reference to Exhibit 4 of the Company's Current
Report on Form 8-K, dated December 15, 1998 (File No. 1-8591).
(5) Incorporated herein by reference to Exhibit 4(c) to the Company's
Annual Report on Form 10-K for the year ended December 31, 1989 (File
No. 1-8591).
(6) Incorporated herein by reference to Exhibit 4(c) to the Company's
Annual Report on Form 10-K for the year ended December 31, 1986 (File
No. 1-8591).
(7) Incorporated herein by reference to Exhibit 3(4)(f) to the Company's
Form 8-B filed October 19, 1983 (File No. 1-8591).
<PAGE> 1
Exhibit 4.1
SCOTT TECHNOLOGIES, INC.
------------------------
401(k) SAVINGS PLAN FOR HOURLY PAID EMPLOYEES
---------------------------------------------
As Amended and Restated Effective: January 1, 1998
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
ARTICLE NO.
-----------
<S> <C>
NAME AND PURPOSE I
DEFINITIONS II
PARTICIPATING DIVISIONS III
ELIGIBILITY AND PARTICIPATION IV
SALARY DEFERRAL CONTRIBUTIONS V
COMPANY CONTRIBUTIONS VI
INVESTMENT FUNDS AND DIRECTION OF INVESTMENT VII
ACCOUNTS VIII
WITHDRAWALS FROM ACCOUNTS IX
HARDSHIP DISTRIBUTIONS X
LOANS XI
TERMINATION OF EMPLOYMENT XII
RETIREMENT BENEFITS XIII
DEATH BENEFITS XIV
DISTRIBUTIONS XV
THE TRUSTEE, ITS POWERS AND DUTIES XVI
INVESTMENT MANAGEMENT XVII
ADMINISTRATION XVIII
PROHIBITION AGAINST ALIENATION XIX
AMENDMENT AND TERMINATION XX
LIMITATIONS ON CONTRIBUTIONS XXI
</TABLE>
ii
<PAGE> 3
<TABLE>
<S> <C>
LIMITATION ON ANNUAL ADDITIONS XXII
ROLLOVERS AND TRANSFERS INVOLVING OTHER
QUALIFIED RETIREMENT PLANS XXIII
TOP-HEAVY PROVISIONS XXIV
SPECIAL PROVISIONS WITH RESPECT TO CERTAIN SHARES XXV
MISCELLANEOUS XXVI
</TABLE>
iii
<PAGE> 4
INDEX
<TABLE>
<CAPTION>
ARTICLE NO.
-----------
<S> <C>
ACCOUNTS VIII
ADMINISTRATION XVIII
AMENDMENT AND TERMINATION XX
COMPANY CONTRIBUTIONS VI
DEATH BENEFITS XIV
DEFINITIONS II
DISTRIBUTIONS XV
ELIGIBILITY AND PARTICIPATION IV
HARDSHIP DISTRIBUTIONS X
INVESTMENT FUNDS AND DIRECTION OF INVESTMENT VII
INVESTMENT MANAGEMENT XVII
LIMITATION ON ANNUAL ADDITIONS XXII
LIMITATIONS ON CONTRIBUTIONS XXI
LOANS XI
MISCELLANEOUS XXVI
NAME AND PURPOSE I
PARTICIPATING DIVISIONS III
PROHIBITION AGAINST ALIENATION XIX
RETIREMENT BENEFITS XIII
ROLLOVERS AND TRANSFERS INVOLVING OTHER
QUALIFIED RETIREMENT PLANS XXIII
SALARY DEFERRAL CONTRIBUTIONS V
</TABLE>
iv
<PAGE> 5
<TABLE>
<S> <C>
SPECIAL PROVISIONS WITH RESPECT TO CERTAIN SHARES XXV
TERMINATION OF EMPLOYMENT XII
THE TRUSTEE, ITS POWERS AND DUTIES XVI
TOP-HEAVY PROVISIONS XXIV
WITHDRAWALS FROM ACCOUNTS IX
</TABLE>
v
<PAGE> 6
AMENDMENT AND RESTATEMENT
-------------------------
OF
--
FIGGIE INTERNATIONAL INC.
-------------------------
401(k) SAVINGS PLAN FOR HOURLY PAID EMPLOYEES
---------------------------------------------
AS THE
------
SCOTT TECHNOLOGIES, INC.
------------------------
401(k) SAVINGS PLAN FOR HOURLY PAID EMPLOYEES
---------------------------------------------
THIS AMENDMENT AND RESTATEMENT is adopted by and between SCOTT
TECHNOLOGIES, INC. (formerly known as Figgie International Inc.), a corporation
organized and existing under and by virtue of the laws of the State of Delaware
(hereinafter called the "Company"), and WILMINGTON TRUST COMPANY (hereinafter
called the "Trustee");
W I T N E S S E T H:
--------------------
WHEREAS, on November 20, 1995 the Company established a 401(k)
Savings Plan for Hourly Paid Employees (hereinafter called the "Trust and Plan"
and previously known as the Figgie International Inc. 401(k) Savings Plan for
Hourly Paid Employees and the Figgie International Inc. Savings Plan for Hourly
Paid Employees), effective January 1, 1996; and
WHEREAS, the Trust and Plan has been amended since its
establishment; and
WHEREAS, it is the desire of the Company to amend and restate
the Trust and Plan in order to reflect the transfer of certain assets and
liabilities from the Figgie International Inc. Stock Ownership Trust and Plan
into the Trust and Plan and to make certain other necessary and desirable
changes;
vi
<PAGE> 7
NOW, THEREFORE, in consideration of the mutual covenants,
conditions and agreements herein contained, it is mutually agreed that the Trust
and Plan be amended and restated effective, except as otherwise provided herein,
as of the first day of January, 1998, as follows:
vii
<PAGE> 8
ARTICLE I
---------
NAME AND PURPOSE
----------------
1.1 The name of this Trust and Plan shall be SCOTT TECHNOLOGIES, INC.
401(k) SAVINGS PLAN FOR HOURLY PAID EMPLOYEES. This Trust and Plan was
originally created and is hereby continued for the purpose of providing benefits
to the participants in this Trust and Plan upon their retirement and for the
purpose of providing such other benefits to such participants and their
beneficiaries as are hereinafter described.
1-1
<PAGE> 9
ARTICLE II
----------
DEFINITIONS
-----------
Unless the context otherwise indicates, the following terms used herein
shall have the following meanings whenever used in this instrument:
2.1 The word "accounts" shall mean "employer contribution accounts",
"salary deferral accounts", "non-forfeitable accounts" and "Stock Plan
accounts", which, in the case of a person who was previously a salaried employee
of the Company or an affiliate and who participated in the Figgie International
Inc. Stock Bonus Trust and Plan, the Salaried ESOP or the Figgie Security, Inc.
Stock Bonus Trust and Plan or the beneficiary of such a person shall be further
denominated as "Stock Bonus Plan accounts", "ESOP accounts" and "Salaried ESOP
accounts."
2.2 The word "Administrator" shall mean the Company.
2.3 The words "Adoption Date" shall mean the date as of which a Division
shall have become a Participating Division in accordance with Article III
hereof.
2.4 The word "affiliate" shall mean any corporation or business
organization during any period during which it is a member of a controlled group
of corporations or trades or businesses which includes the Company within the
meaning of Sections 414(b) and 414(c) of the Code or is a member of an
affiliated service group which includes the Company within the meaning of
Section 414(m) of the Code.
2.5 The words "allocation date" shall mean the last day of each of the
Company's taxable years ending after the restatement date.
2.6 The word "beneficiary" shall mean any person, other than an alternate
payee as defined in Section 19.1(a) hereof, who receives or is designated to
receive payment of
2-1
<PAGE> 10
any benefit under the terms of this Trust and Plan because of the participation
of another person in this Trust and Plan.
2.7 The word "Code" shall mean the Internal Revenue Code of 1986, as such
may be amended from time, and any lawful regulations or rulings thereunder.
2.8 The word "Committee" shall mean the Appeals Committee constituted
under the provisions of Article XVIII hereof.
2.9 The word "Company" shall mean SCOTT TECHNOLOGIES, INC. or any
successor corporation or business organization which shall assume the
obligations of the Company under this Trust and Plan as provided herein with
respect to the participants.
2.10 The word "compensation" shall generally mean taxable remuneration
paid to an employee for services rendered to the Company or an affiliate which
must be reported as wages on the employee's Form W-2 for income tax purposes.
Compensation shall be increased for salary reduction amounts which are excluded
from the taxable income of the employee under Sections 125, 402(e)(3) and 402(h)
of the Code. Compensation shall be reduced by all of the following amounts even
if they are taxable to the employee:
(a) all amounts related to any funded deferred compensation plan,
whether or not qualified;
(b) expense reimbursements, expense allowances or moving expenses;
(c) all amounts related to restricted property or stock options,
whether qualified or nonqualified; and
(d) any cash or non-cash fringe benefits or welfare benefits.
"Compensation" shall not include any remuneration paid to an employee during a
period in which he is not an active participant in this Trust and Plan. In
addition, an employee's "compensation" shall not exceed One Hundred Sixty
Thousand Dollars ($160,000.00) (plus any
2-2
<PAGE> 11
adjustment after 1998 for cost-of-living or otherwise as shall be prescribed by
the Secretary of the Treasury pursuant to Sections 401(a)(17) and 415(d) of the
Code).
2.11 The words "continuous service" shall mean for any employee the
aggregate of all periods during which he is or was employed by the Company or
any affiliate. Each such period shall be measured from his date of hire to the
date of termination of employment which follows such date of hire. In addition,
if any employee has a termination of employment and is rehired within twelve
(12) months of:
(a) the date of his termination of employment; or
(b) if earlier, the first day of any period of leave of absence or
military service after the end of which the employee did not
return to work for the Company or any affiliate prior to his
termination of employment;
such employee's "continuous service" shall include the period of severance
measured from his termination of employment until his subsequent date of rehire.
Two (2) or more periods of employment or periods of severance that are included
in an employee's continuous service and that contain fractions of a year
(computed in months and days) shall be aggregated on the basis of twelve (12)
months constituting a year and thirty (30) days constituting a month.
2.12 The words "Covered Employee" shall an employee of the Company or an
affiliate:
(a) who is an hourly paid employee of a Participating Division; and
(b) either:
(i) who is a citizen or resident of the United States; or
(ii) whose principal place of employment is in the United States;
provided, however, that an employee shall not be considered to be a Covered
Employee if he is an employee whose terms and conditions of employment are
covered by a collective bargaining agreement which does not require him to be
included in this Trust and Plan, he is a leased
2-3
<PAGE> 12
employee, he is a person who receives payment of his remuneration from an entity
which is not the Company or an affiliate or he is an employee who is employed in
accordance with an oral or written employment, consulting or other arrangement,
the terms and conditions of which preclude his participation in this Trust and
Plan.
Any such employee shall cease to be a Covered Employee upon the
earliest to occur of:
(a) his termination of employment;
(b) his ceasing to be an hourly paid employee;
(c) his ceasing to be employed by a Participating Division;
(d) his terms and conditions of employment become covered by a
collective bargaining agreement which does not require him
to be included in this Trust and Plan;
(e) his transfer to a principal place of employment which is
outside the United States if he is not a citizen or
resident of the United States;
(f) his becoming a leased employee or an employee who is
employed in accordance with an oral or written employment,
consulting or other arrangement, the terms and conditions
of which preclude his participation in this Trust and Plan;
or
(g) his becoming a person who receives payment of his
remuneration from an entity which is not the Company or an
affiliate.
2.13 The words "date of hire" shall mean the first day during
which an employee performs an hour of service for the Company or any affiliate
for which he is directly or indirectly compensated or the first day for which
the employee is paid any back pay pursuant to an award or agreement. In the case
of a rehired employee, "date of hire" shall mean the first day following his
previous termination of employment during which the employee performs an hour of
service for the Company or any affiliate for which he is directly or indirectly
compensated or the first day following his previous termination of employment
for which the employee is paid
2-4
<PAGE> 13
any back pay pursuant to an award or agreement. In the event that a business
organization shall be or shall have been acquired by or merged into the Company
or any affiliate, the date of hire of each employee who is or was an employee on
the date of acquisition shall be deemed to have been the most recent date he was
hired by such business organization and performed an hour of service.
2.14 The word "Disabled" shall mean any period during which the
participant is receiving or is entitled to receive disability benefits under any
sick leave, short term disability program or long term disability program of the
Company or any affiliate.
2.15 The word "Division" shall mean any Division, Department, Plant or
Subsidiary of the Company or any Division, Department, or Plant of a Subsidiary
of the Company.
2.16 The words "effective date" of this Trust and Plan shall mean January
1, 1996.
2.17 The word "employee" shall mean any employee, whether salaried or
hourly paid or whether full-time or part-time, of the Company or any affiliate
and shall also include a leased employee.
2.18 The acronym "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as such may be amended from time to time, and any lawful
regulations or rulings thereunder.
2.19 The word "ESOP" shall mean the Figgie International Inc. Stock
Ownership Trust and Plan.
2.20 The words "ESOP Transfer Date" shall mean the end of the day on
December 31, 1997.
2-5
<PAGE> 14
2.21 The words "fair market value" shall mean with respect to the Shares
that price at which a Share would change hands between a willing buyer and a
willing seller, neither being under any compulsion to buy or sell and both
having reasonable knowledge of the relevant facts, including (but not limited
to) the nature and history of the business, current and prospective economic
conditions, book values, current asset values, earnings capacity,
dividend-paying capacity, goodwill, rates of capitalization for comparable
businesses, recent sales of Shares (if any), market value of comparable
businesses, lack of established marketability, contractual conditions which
restrict transfer and the effect of loss of key men. In the event the Shares are
not readily tradeable on an established securities market, the Trustee shall
rely, for all purposes under this Trust and Plan, upon the independent valuation
described in Section 16.6 hereof. In the event Shares are readily tradeable on
an established securities market, the fair market value of a Share shall be
determined with reference to appropriate market quotations.
2.22 The word "hour" shall mean for any employee an hour for which he is
directly or indirectly paid or entitled to payment by the Company or any
affiliate for the performance of services, including payments pursuant to an
award or agreement requiring the Company or an affiliate to pay back wages,
irrespective of mitigation of damages.
2.23 The words "investment fund" shall mean a fund established,
maintained and administered by the Trustee pursuant to Articles VII and XVII
hereof.
2.24 The words "leased employee" shall mean any individual (other than a
common-law employee of the Company or an affiliate) who, pursuant to an
agreement between the Company or an affiliate and any leasing organization, has
performed services under the primary direction or control of the Company or an
affiliate or related persons, as determined in
2-6
<PAGE> 15
accordance with Section 414(n)(6) of the Code, on a substantially full-time
basis for a period of at least one (1) year.
2.25 The words "military service" shall mean duty in the Armed Forces of
the United States, whether voluntary or involuntary, provided that the employee
serves not more than one voluntary enlistment or tour of duty, and further
provided that such voluntary enlistment or tour of duty does not follow
involuntary duty.
2.26 The words "normal retirement date" shall mean for each participant
the later of the following:
(a) the date on which he attains age sixty-five (65); and
(b) the earlier of the fifth (5th) anniversary of the date on which he
became a participant in this Trust and Plan or the date of his
completion of five (5) years of vesting service.
2.27 The word "participant" shall mean any eligible employee who has
become a participant in this Trust and Plan in accordance with Article IV hereof
or a Supplemental Agreement. A person shall cease to be a participant upon his
termination of employment. A participant shall be considered to be an "active
participant" during any period of employment except for:
(a) any period during which he is not a Covered Employee;
(b) any period during which he is designated as an inactive
participant by a Supplemental Agreement by which he is covered;
and
(c) any period during which he is Disabled.
2.28 The words "Participating Division" shall mean any Division which is
or shall become a Participating Division in this Trust and Plan pursuant to
Article III hereof.
2-7
<PAGE> 16
2.29 The words "payroll cut-off date" shall mean the last date upon which
data can be input into the payroll system or changed with respect to the
production of payroll checks for a payroll period.
2.30 The words "period of severance" shall mean for any employee or
former employee a period commencing on his termination of employment and ending
on the date such employee or former employee is rehired by the Company or any
affiliate. A "one year period of severance" shall mean a twelve (12) month
period of severance during which an employee does not complete at least one (1)
hour for the Company or any affiliate. Notwithstanding the foregoing provisions
of this Section, in the event any employee ceases to be actively employed after
December 31, 1984 either:
(a) by reason of the pregnancy of such employee; or
(b) by reason of the birth of a child of such employee; or
(c) by reason of the placement of a child with such employee in
connection with the adoption of such child by such employee; or
(d) by reason of caring for such child for a period beginning
immediately following such birth or placement;
such employee's period of severance shall be deemed to have commenced on the
later of the first anniversary of the date he ceased to be actively employed or
his termination of employment.
2.31 The words "permanent and total disability" shall mean any disability
for which the participant is entitled to receive and is receiving disability
insurance benefits under Title II of the Federal Social Security Act.
2.32 The words "plan year" shall mean the calendar year.
2.33 The words "qualified nonelective contributions" shall mean any
special employer contribution made by the Company pursuant to Section 6.3 hereof
and any other fully vested employer contribution made by the Company to this
Trust and Plan.
2-8
<PAGE> 17
2.34 The words "Qualified Person" shall mean a participant or former
participant who has attained age fifty-five (55) and has completed five (5)
years of vesting service or the beneficiary of such a deceased participant or
former participant.
2.35 The words "restatement date" shall mean the date on which this
Amendment and Restatement became effective, which date is January 1, 1998.
2.36 The words "Salaried ESOP" shall mean the Figgie International Inc.
Stock Ownership Trust and Plan for Salaried Employees.
2.37 The words "salary deferral contributions" shall mean contributions
made to this Trust and Plan by the Company on behalf of an active participant
pursuant to such active participant's election under Section 5.1 hereof and paid
to the Trustee pursuant to Section 5.3 hereof.
2.38 The word "Shares" shall mean Shares of the Company's capital stock
which are denominated either Class A Common Stock or Class B Common Stock,
together with any voting trust certificates representing beneficial ownership of
such Shares.
2.39 The words "Stock Plans" shall mean the following plans:
(a) the ESOP;
(b) the Figgie International Inc. Stock Bonus Trust and Plan;
(c) the Salaried ESOP; and
(d) the Figgie Security, Inc. Stock Bonus Trust and Plan.
2.40 The words "Supplemental Agreement" shall mean an agreement adopted
by the Company pursuant to Section 3.2 hereof setting forth special provisions
applicable to specific groups of employees, former employees or beneficiaries of
deceased employees.
2.41 The words "taxable year" shall mean the calendar year.
2-9
<PAGE> 18
2.42 The words "termination of employment" shall mean for any employee
the occurrence of any one of the following events:
(a) his discharge unless he is subsequently reemployed by the Company
or an affiliate and given pay back to his date of discharge;
(b) his voluntary termination of employment with the Company or any
affiliate;
(c) his retirement from employment with the Company or any affiliate;
(d) his failure to return to work:
(i) at the end of any leave of absence authorized by the
Company; or
(ii) within ninety (90) days following such employee's release
from military service or within any other period following
military service in which his right to reemployment with
the Company or any affiliate is guaranteed by law; or
(iii) after the cessation of disability benefits under any sick
leave, short term disability program or long term
disability program of the Company; or
(iv) within three (3) days after he has been recalled to work
following a period of layoff;
(e) he has been continuously laid-off for twelve (12) months;
(f) if the stock or assets of the business unit by which the employee
is employed are sold to a person or entity which is not an
affiliate of the Company or are transferred to a joint venture
which is not an affiliate of the Company and this Trust and Plan
is assumed by such person, entity or joint venture, his
termination of employment (as defined in subparagraphs (a) through
(e) above) with such person, entity or joint venture; or
(g) if the stock or assets of the business unit by which the employee
is employed are sold to a person or entity which is not an
affiliate of the Company or are transferred to a joint venture
which is not an affiliate of the Company and this Trust and Plan
is not assumed by such person, entity or joint venture, the date
of sale of the stock or assets or the date of such transfer.
In the case of the occurrence of any event described in subparagraph (d)(i),
(d)(ii) or (e) of this Section, the date of such employee's termination of
employment shall be deemed to be the
2-10
<PAGE> 19
earlier of (A) the first anniversary of the first day of any such period of
leave of absence, military service or layoff, or (B) the last day of any such
period of leave of absence, military service or layoff.
2.43 The words "Transition Period No. 1" shall mean the period which
commenced on June 14, 1997 and ended on September 26, 1997, the date which was
one (1) month following the final reconciliation of the valuation of this Trust
and Plan's assets by the prior recordkeeper for the second quarter of 1997.
2.44 The words "Transition Period No. 2" shall mean the period commencing
on December 31, 1997 and ending on the date which is one (1) month following the
final reconciliation of the ESOP's fourth quarter valuation by the ESOP's prior
recordkeeper.
2.45 The words "Trust and Plan" shall mean this instrument as originally
executed, as it is amended and restated herein and as it may be amended from
time to time hereafter.
2.46 The word "Trustee" shall mean the person or persons serving as the
Trustee of this Trust and Plan and any successor Trustee or Trustees.
2.47 The words "Trust Fund" shall mean the Trust established by this
Trust and Plan including the separate investment funds established pursuant to
Article VII hereof.
2.48 The word "Unit" shall mean an accounting unit representing an
interest in one of the investment funds established under Article VII hereof.
2.49 The words "valuation date" shall mean the date as of which account
balances are valued.
2-11
<PAGE> 20
2.50 The words "vested account balances" shall mean for any participant
or former participant his vested interest and shall mean for any beneficiary the
portion of his account balances which represent a deceased participant's or
former participant's vested interest.
2.51 The words "vested interest" shall mean, with respect to any
participant, (a) plus (b) minus (c) below, where:
(a) equals the balances, if any, then credited to all salary deferral
accounts, non-forfeitable accounts and Stock Plan accounts
maintained on his behalf;
(b) equals the sum of:
(i) the balance, if any, then credited to his employer
contribution account multiplied by his vested percentage;
plus
(ii) any distributions made to the participant which have not
been recontributed by the participant pursuant to Section
12.5 hereof or withdrawals by the participant from his
employer contribution account since his earliest date of
hire which has not been followed by a five (5) year period
of severance, multiplied by his vested percentage; and
(c) equals any distributions made to the participant which have not
been recontributed by the participant pursuant to Section 12.5
hereof or withdrawals by the participant from his employer
contribution account since his earliest date of hire which has not
been followed by a five (5) year period of severance.
2.52 The words "vested percentage" shall mean for any participant a
percentage determined on the basis of his number of years of vesting service in
accordance with the following table:
Years of Vesting Service Vested Percentage
------------------------ -----------------
Less than 1 year 0%
1 but less than 2 years 20%
2 but less than 3 years 40%
3 but less than 4 years 60%
4 but less than 5 years 80%
5 or more years 100%
2-12
<PAGE> 21
In any event, the "vested percentage" of a participant who has attained his
normal retirement date or who is permanently and totally disabled shall be one
hundred percent (100%).
2.53 The words "vesting service" shall mean for any employee the
aggregate of all his periods of continuous service with the Company or any
affiliate, except as otherwise provided below.
The "vesting service" of an employee who terminates employment and who is
later reemployed by the Company or any affiliate shall not include the length of
any of his periods of continuous service rendered prior to the date of said
termination of employment if all of the following apply:
(a) his period of severance between said date of termination of
employment and the date he is reemployed equals or exceeds the
period of vesting service he had on said date of termination of
employment; and
(b) he did not have a vested interest under this Trust and Plan or any
of the Stock Plans on his termination of employment; and
(c) his period of severance equals or exceeds either:
(i) one (1) year if his termination of employment occurred
prior to January 1, 1985; or
(ii) five (5) years if his termination of employment occurred on
or after January 1, 1985.
2-13
<PAGE> 22
ARTICLE III
-----------
PARTICIPATING DIVISIONS
-----------------------
3.1 A Division shall become a Participating Division under this Trust and
Plan by order of the Board of Directors of the Company with, in the case of a
Subsidiary of the Company, the ratification of the Board of Directors of the
Subsidiary. By becoming a Participating Division under this Trust and Plan, a
Subsidiary of the Company is deemed to approve this Trust and Plan in the form
as of its Adoption Date, together with any future amendments or restatements
made by the Company after such Adoption Date, even though such amendments or
restatements are not specifically ratified by the Subsidiary. The Participating
Divisions as of the date of execution of this Amendment and Restatement are as
follows:
Scott Aviation Division
Monroe, North Carolina
South Haven, Michigan
A Participating Division shall be added to this Section hereof upon becoming a
Participating Division. Divisions which were formerly Participating Divisions
but which have ceased to be Participating Divisions shall be deleted from this
Section.
3.2 The Company may, in the sole discretion of its Board of Directors,
determine that special provisions shall be applicable to specific groups of
employees, former employees or beneficiaries of deceased employees which groups
are not discriminatory in nature, either in addition to, or in lieu of the
provisions of this Trust and Plan, or may determine that certain employees of a
Participating Division shall not be eligible to participate in this Trust and
Plan. In such event, the Company shall adopt a Supplemental Agreement with
respect to such employees, former employees and beneficiaries of deceased
employees which shall specify the employees, former employees and beneficiaries
of deceased employees covered by the
3-1
<PAGE> 23
Supplemental Agreement and the special provisions applicable to such employees,
former employees and beneficiaries of deceased employees. Supplemental
Agreements shall be deemed to be a part of this Trust and Plan solely with
respect to the employees, former employees and beneficiaries of deceased
employees specified therein.
3.3 The Company may, from time to time amend, modify or terminate a
Supplemental Agreement provided, however, that no such action shall operate so
as to deprive any participant, former participant or beneficiary who was covered
by such Supplemental Agreement of any vested rights to which he is entitled
under this Trust and Plan or the Supplemental Agreement.
3-2
<PAGE> 24
ARTICLE IV
----------
ELIGIBILITY AND PARTICIPATION
-----------------------------
4.1 Every employee who was a participant in this Trust and Plan
immediately prior to the restatement date shall continue to be a participant
until his termination of employment.
4.2 On and after the restatement date, every other employee who is a
Covered Employee shall automatically become a participant in this Trust and Plan
on the date he becomes a Covered Employee.
4.3 In the event that a former participant is rehired, he shall become a
participant on his date of reemployment if he is a Covered Employee on such
date.
4.4 Each person on whose behalf account balances have been or will be
transferred to the Trustee from the ESOP automatically became a participant,
terminated participant, retired participant, beneficiary or alternate payee, as
the case may be, in this Trust and Plan, effective as of the ESOP Transfer Date,
if he was not already a participant under or otherwise entitled to future
benefits from this Trust and Plan.
4-1
<PAGE> 25
ARTICLE V
---------
SALARY DEFERRAL CONTRIBUTIONS
-----------------------------
5.1 Pursuant to uniform rules and procedures prescribed by the
Administrator, an active participant may elect that a portion of his unpaid
compensation for a plan year be paid by the Company to the Trustee hereunder as
a salary deferral contribution and be treated as a contribution by the Company.
Any election by a participant pursuant to this Section shall be expressed in one
percent (1%) increments of his compensation for a payroll period. The
Administrator may, from time to time, establish maximum percentage limits on the
amount of salary deferral contributions that participants can make under this
Trust and Plan and may establish maximum percentage limits which apply solely to
highly compensated employees. As of the restatement date and until changed by
the Administrator pursuant to this Section, the maximum percentage of an active
participant's compensation (minus, for years prior to January 1, 1999, any
salary reduction amounts which are excluded from the taxable income of the
participant under Section 125 of the Code) for a payroll period that is subject
to election pursuant to this Section shall be fifteen percent (15%).
5.2 A participant's initial election pursuant to Section 5.1 hereof shall
be in writing, or in such form as is required by the Administrator, shall become
effective at such time as the Administrator shall permit and shall be
conditioned upon:
(a) his right to defer the imposition of federal income tax on such
contributions until a subsequent distribution of such amount under
this Trust and Plan; and
(b) the Company's right to deduct such amounts for federal income tax
purposes after taking into account any contributions made by the
Company under any profit sharing, pension and stock bonus plans
maintained by the Company which meet the requirements of Section
401(a) of the Code.
5-1
<PAGE> 26
Any such election shall be deemed a continuing election and shall remain in
effect until it is revoked or amended by the participant in writing, or by such
other procedures as shall be established by the Administrator from time to time,
or the participant ceases to be an active participant. A participant may revoke
or amend his election at such times as the Administrator shall permit. A
participant shall revoke or amend his election by providing such notice to the
Administrator as the Administrator, in its sole discretion, shall require.
As of the restatement date and until changed by the Administrator
pursuant to this Section, a participant will be able to revoke or amend his
election as of the first payroll payment date on or after the first day of any
calendar quarter, provided that he notifies the Administrator in writing, or by
such other procedures as shall be established by the Administrator from time to
time, no later than the tenth (10th) day of the month prior to such calendar
quarter. In addition, as of the restatement date and until changed by the
Administrator pursuant to this Section, an employee who is a new active
participant will be able to make an election pursuant to Section 5.1 hereof upon
his entry into this Trust and Plan and such election shall be implemented as of
the next payroll cut-off date after such election is received by the
Administrator.
5.3 All amounts paid by the Company to the Trustee pursuant to Section
5.1 hereof shall be paid in cash not later than the date on which such amounts
can reasonably be segregated from the Company's general assets, which in no
event shall be later than the fifteenth (15th) business day of the month
following the month in which such amounts would have otherwise been payable to
the participants in cash. Such amounts shall be credited to the participants'
salary deferral accounts.
5.4 In the event a participant receives a distribution from his salary
deferral account as a result of hardship as described in Article X hereof, such
participant's salary deferral
5-2
<PAGE> 27
contributions shall be suspended for a twelve (12) month period after his
receipt of such hardship distribution. In addition, for the taxable year of the
participant immediately following the participant's taxable year during which
said hardship distribution occurs, such participant shall be barred from making
salary deferral contributions in excess of (a) minus (b) below, where:
(a) equals Ten Thousand Dollars ($10,000.00) (plus any cost of living
increase after 1998 allowable under Section 402(g) of the Code for
such immediately following taxable year of the participant); and
(b) equals the amount of such participant's salary deferral
contributions for the participant's taxable year during which said
hardship distribution is made.
5-3
<PAGE> 28
ARTICLE VI
----------
COMPANY CONTRIBUTIONS
---------------------
6.1 For each taxable year ending after the restatement date, the Company
may make an employer discretionary contribution to this Trust and Plan on behalf
of each participant who:
(a) is actively employed on the allocation date coinciding with the
last day of said taxable year; or
(b) terminated his employment on or as of said allocation date.
Participants whose employment terminated prior to such allocation
date or who are Disabled on such allocation date shall not be allocated any
portion of said employer discretionary contribution.
The employer contribution account of each such participant shall be
credited with that portion of the employer discretionary contribution for such
taxable year which bears the same relationship to the employer discretionary
contribution as such participant's compensation, determined as of the last day
of the Company's taxable year, bears to the total compensation, determined as of
said date, of all such participants.
Any employer discretionary contribution shall be an amount of cash or a
number of Shares, or both, as shall be approved or ratified and confirmed by a
resolution of the Board of Directors of the Company. Any contribution of Shares
may be from authorized but unissued Shares or treasury Shares. The employer
discretionary contribution so approved by the Board of Directors shall be
contributed to the Trustee within the first three (3) calendar months following
the end of such taxable year and shall be deemed to have been credited to the
employer contribution accounts of the participants described above on the
aforesaid allocation date
6-1
<PAGE> 29
described above. Fractional interests in Shares shall be credited to the
employer contribution accounts of participants to the nearest one-thousandth
(0.001th) of a Share.
6.2 For each payroll payment after the restatement date, the Company
shall make matching contributions to this Trust and Plan on behalf of each
active participant on whose behalf salary deferral contributions are being made
out of such payroll payment and each active participant on whose behalf salary
deferral contributions would have been made out of such payroll payment but for
the calendar year limit on salary deferral contributions imposed by Section
402(g)(1) of the Code, as adjusted for cost of living increases ("402(g)(1)
Limit"). Matching contributions made on behalf of an active participant with
respect to a particular payroll payment in a calendar year shall have a value
equal to (a) plus (b) below, where:
(a) equals the lesser of:
(i) the salary deferral contributions which were made to this
Trust and Plan by the Company on behalf of such active
participant or which would have been made on behalf of such
active participant out of such payroll payment but for the
402(g)(1) Limit (based on such active participant's rate of
salary deferral contributions immediately prior to
limitation by the 402(g)(1) Limit); and
(ii) one percent (1%) of such active participant's compensation
during the payroll period to which such payroll payment
relates; and
(b) equals (i) multiplied by (ii) below, where:
(i) equals the lesser of:
(A) the salary deferral contributions which were made to
this Trust and Plan by the Company on behalf of such
active participant or which would have been made on
behalf of such active participant out of such
payroll payment but for the 402(g)(1) Limit (based
on such active participant's rate of salary deferral
contributions immediately prior to limitation by the
402(g)(1) Limit) and which are in excess of one
percent (1%) of such active participant's
compensation during the payroll period to which such
payroll payment relates; and
6-2
<PAGE> 30
(B) four percent (4%) of such active participant's
compensation during the payroll period to which such
payroll payment relates; and
(ii) equals twenty-five percent (25%).
Notwithstanding the foregoing, the maximum matching contribution for any
participant for a calendar year ending after the restatement date shall two
percent (2%) of the limit on compensation imposed by Section 401(a)(17) of the
Code, as adjusted for cost of living increases, for such calendar year
("401(a)(17) Limit"). The maximum matching contribution for any participant for
the 1998 calendar year is Three Thousand Two Hundred Dollars ($3,200.00) or two
percent (2%) of the 1998 401(a)(17) Limit.
Any matching contributions shall be in cash and shall be credited to the
employer contribution accounts of such participants as of the date such
contributions are received by the Trustee.
6.3 For each taxable year ending after the restatement date, the Company
may make a special employer contribution to this Trust and Plan. Any special
employer contribution shall be allocated to the non-forfeitable accounts of some
or all of the participants who are not highly compensated employees in such
manner as the Company shall designate at the time such special employer
contribution is made to this Trust and Plan. Any special employer contribution
shall be in an amount of cash as shall be approved or ratified and confirmed by
a resolution of the Board of Directors of the Company. Any special employer
contribution so approved by the Board of Directors shall be contributed to the
Trustee not later than the last day upon which the Company may make a
contribution to this Trust and Plan and secure under the Code a deduction of
such contribution in the computation of its federal income taxes for the taxable
year for which such contribution is made.
6-3
<PAGE> 31
6.4 Any employer discretionary contributions and matching contributions
credited to a participant's employer contribution account pursuant to Sections
6.1 and 6.2 hereof shall be subject to the vesting schedule set forth in Section
2.52 hereof. Any special employer contributions credited to a participant's
non-forfeitable account pursuant to Section 6.3 hereof shall be fully vested and
nonforfeitable.
6-4
<PAGE> 32
ARTICLE VII
-----------
INVESTMENT FUNDS AND DIRECTION OF INVESTMENT
--------------------------------------------
7.1 The Trustee shall maintain such investment funds within the Trust
Fund as the Company may from time to time prescribe, including but not limited
to the following:
(a) money market funds;
(b) mutual funds;
(c) equity funds;
(d) fixed income funds;
(e) balanced funds;
(f) any pooled investment fund established by a bank;
(g) any insurance company's general account;
(h) any special account established and maintained by any
insurance company;
(i) guaranteed investment contracts, including pooled funds of
guaranteed investment contracts; and
(j) Company Stock Funds.
The Company shall have the sole discretion to determine the number of investment
funds to be maintained hereunder and the nature of the funds and may change or
eliminate the funds from time to time. Investment funds maintained hereunder
shall be held and administered in accordance with the powers and duties set
forth in Article XVII hereof. In addition, the Trustee may hold assets of any
investment fund in cash or in short-term money market instruments as it deems
appropriate.
As of the restatement date the Trustee is maintaining the
following types of investment funds within the Trust Fund:
(a) Stable Income Fund;
7-1
<PAGE> 33
(b) Fixed Income Fund;
(c) Balanced Fund;
(d) Growth & Income Fund;
(e) Flexible Asset Allocation Fund;
(f) Equity Growth Fund;
(g) Small Cap Growth Fund;
(h) International Fund;
(i) Conservative Lifestyle Fund;
(j) Moderate Lifestyle Fund;
(k) Aggressive Lifestyle Fund;
(l) Class A Common Stock Fund, consisting of shares of the Company's
Class A Common Stock; and
(m) Class B Common Stock Fund, consisting of shares of the Company's
Class B Common Stock.
7.2 Each participant, former participant or beneficiary, by written
direction to the Administrator or by such other procedures as shall be
established by the Administrator from time to time, shall direct the investment
of his accounts, other than his Stock Plan account or accounts, and
contributions being made to any such accounts in the investment funds
established hereunder; provided, however, that any such investment directions
shall be made in accordance with such other rules as are established by the
Administrator from time to time in its sole discretion including rules requiring
that investment selections be made in percentage increments. Any investment
direction with respect to contributions being made to any such accounts of a
participant shall be deemed a continuing direction and shall remain in effect
unless revoked or changed by the participant. A participant, former participant
or beneficiary may change his investment direction at such times and upon such
notice as the Administrator, from time to time,
7-2
<PAGE> 34
may require. Each participant shall indicate whether any change in investment
direction shall apply only to contributions made to this Trust and Plan
following such change or whether such change shall also operate to change the
investment of Units of any investment fund already credited to his accounts. If
a procedure for daily change of investment is offered by the Administrator, such
investment direction may be changed on a daily basis, such change generally to
be effective as of the end of the day of the change, but subject to reasonable
administrative delays. Any rules established by the Administrator pursuant to
this Section shall apply to all participants, former participants and
beneficiaries in a uniform and nondiscriminatory manner. It is intended that the
total account balances of all employer contribution accounts, salary deferral
accounts and non-forfeitable accounts which have not been segregated as a result
of a loan be invested in the investment funds established hereunder. In the
event that a participant, former participant or beneficiary does not direct the
investment of any portion of such account balances, such undirected portion of
such account balances shall be invested in the Conservative Lifestyle Fund. No
directions of investment with respect to Stock Plan accounts shall be made
pursuant to this Section 7.2.
7.3 Each Qualified Person by written direction to the Administrator or by
such other procedures as shall be established by the Administrator from time to
time, may direct the investment of his Stock Plan account or accounts in any or
all of the investment funds established hereunder; provided, however, that such
investment directions shall be made in accordance with such rules as are
established by the Administrator from time to time in its sole discretion
including rules requiring that investment selections be made effective as of
specific dates and within a certain period of dates prior to the specified date.
As of the restatement date and until changed by the Administrator pursuant to
this Section, Qualified Persons shall be able
7-3
<PAGE> 35
to direct the investment of their Stock Plan accounts on a quarterly basis. Such
direction shall become effective after all accounting and recordkeeping
functions for the calendar quarter have been completed. Any rules established by
the Administrator pursuant to this Section shall apply to all Qualified Persons
in a uniform and nondiscriminatory manner. Participants, former participants and
beneficiaries who are not Qualified Persons may not direct the investment of
their Stock Plan accounts and it is intended that such accounts remain invested
in the Class A Common Stock Fund and/or the Class B Common Stock Fund.
7.4 The interest of any account in an investment fund shall be measured
in terms of Units which shall be equal, undivided interests in the assets of the
investment fund. The initial value of a Unit of an investment fund shall be such
uniform amount of money or uniform value as determined by the Trustee. The value
of a Unit in an investment fund shall be redetermined daily by the Trustee by
dividing the fair market value of the investment fund (including any uninvested
cash) as of the next preceding business day by the total number of Units of such
investment fund then credited to the accounts of participants, former
participants and beneficiaries who are then invested in the investment fund.
Fractional Units of the investment fund shall be credited to an account to a
least two (2) decimal places. It is intended that this Section operate to adjust
each investment fund to reflect all income attributable to such investment fund
and changes in the value of such investment fund's assets, as the case may be,
as of any valuation date and, as a result of the adjustment of Unit values, to
distribute among all accounts and subaccounts having an interest in such
investment fund, all such income and value changes.
7.5 If a participant, former participant or beneficiary has made a proper
change of investment direction pursuant to Section 7.2 or 7.3 hereof with
respect to Units of any
7-4
<PAGE> 36
investment fund already credited to his accounts, his accounts shall be debited
by the number of Units of any such investment fund which have been sold and
credited with the number of Units of any such investment fund which have been
purchased in order to accomplish such change of investment.
7.6 Notwithstanding anything contained in this Trust and Plan to the
contrary and except as provided below, a participant's, former participant's or
beneficiary's investment of his accounts, other than his Stock Plan account or
accounts, in both the Class A Common Stock Fund and the Class B Common Stock
Fund may not exceed such limit as shall be established by the Administrator from
time to time. However, in the event subsequent appreciation in the Class A
Common Stock or the Class B Common Stock held in a participant's, former
participant's or beneficiary's accounts, other than his Stock Plan account or
accounts, causes such person's investment of such accounts in the Class A Common
Stock Fund and the Class B Common Stock Fund to exceed such limit, the Trustee
shall not be required to reduce such person's investment in such Stock Funds
unless so directed by such person. In addition, in the event a participant,
former participant or beneficiary directs that any portion of his account
balances, other than his Stock Plan account balance or account balances, which
is invested in the Class A Common Stock Fund or the Class B Common Stock Fund be
reallocated to another investment fund which is not the Class A Common Stock
Fund or the Class B Common Stock Fund, such person's right to direct further
investment in the Class A Common Stock Fund or the Class B Common Stock Fund
shall be suspended for a period of twelve (12) months from the date on which
such reallocation was effective. Such twelve (12) month suspension shall not
apply to reallocations between the Class A Common Stock Fund and the Class B
Common Stock Fund.
7-5
<PAGE> 37
7.7 The Administrator determined that no investment directions or changes
in or revocations of investment directions, including reallocations between the
investment funds, would be accepted by the Administrator from existing
participants, former participants and beneficiaries during Transition Period No.
1 with respect to Shares or other assets credited to accounts prior to July 1,
1997 ("Pre-7/1/97 Assets"). Investment directions made by participants, former
participants and beneficiaries after April 1, 1997 and prior to June 14, 1997
with respect to Pre-7/1/97 Assets were implemented as of July 1, 1997 and were
not permitted to be changed until the end of Transition Period No. 1. The
foregoing restriction did not apply to any assets of this Trust and Plan which
were not Pre-7/1/97 Assets.
Similarly, the Administrator has determined that no investment directions
or changes in or revocations of investment directions, including reallocations
between the investment funds, will be accepted by the Administrator from
Qualified Persons during Transition Period No. 2 with respect to assets being
transferred from the ESOP to accounts hereunder. Investment directions made by
Qualified Persons during December 1997 with respect to such assets will be
implemented as of the beginning of the day on January 1, 1998 and will not be
permitted to be changed until the end of Transition Period No. 2. After
Transition Period No. 2 has ended, investment directions may be made in
accordance with procedures established by the Administrator pursuant to Section
7.3 hereof.
7.8 All assets which are transferred from the ESOP to accounts hereunder
shall be credited to the investment funds maintained under this Trust and Plan
effective as of the ESOP Transfer Date as follows:
(a) non-Share assets held in investment funds maintained under the
ESOP shall be credited to the investment funds being maintained
under this Trust and Plan in accordance with the investment
directions of Qualified Persons;
7-6
<PAGE> 38
(b) Shares of the Company's Class A Common Stock ("Class A Shares")
and cash representing fractional Class A Shares, together with any
other attributable cash, shall be credited to the Class A Common
Stock Fund; and
(c) Shares of the Company's Class B Common Stock ("Class B Shares")
and cash representing fractional Class B Shares, together with any
other attributable cash, shall be credited to the Class B Common
Stock Fund.
7.9 The investment direction procedures of this Article are and shall
continue to be designed so as to comply, in the sole judgment of the
Administrator, with the requirements imposed by Section 404(c) of ERISA and
regulations thereunder, and shall apply to all participants, former participants
and beneficiaries in a uniform and nondiscriminatory manner.
7-7
<PAGE> 39
ARTICLE VIII
------------
ACCOUNTS
--------
8.1 Salary deferral accounts, employer contribution accounts and
non-forfeitable accounts being maintained by the Administrator immediately prior
to the restatement date shall continue to be maintained under this Trust and
Plan as amended and restated herein. In addition, effective as of the ESOP
Transfer Date, the Trustee shall establish Stock Plan accounts to receive assets
which were transferred from the ESOP and which were previously held under one or
more of the Stock Plans. Such accounts shall be credited and debited as provided
in this Article.
8.2 Upon an employee becoming a participant, the Administrator shall
establish a salary deferral account and employer contribution account in the
name of such participant. Salary deferral and employer contribution accounts
established on behalf of a new participant shall be deemed to have been
established on the date upon which or as of which such participant became a
participant.
8.3 The accounts of participants shall be credited with contributions as
specified in Articles V and VI hereof and in Sections 12.5 and 24.3 hereof and
shall be debited to take into account any withdrawals or distributions made from
such accounts pursuant to Article IX, X or XV hereof. All such credits and
debits to the accounts of a participant shall be made as of the dates specified
in the appropriate Sections of this Trust and Plan.
8.4 In the event a participant directs, pursuant to Article VII hereof,
that his account or accounts are to be invested in more than one (1) investment
fund, the Administrator shall maintain subaccounts as a part of such
participant's account or accounts. Such subaccounts shall show the portion of an
account invested in a particular investment fund.
8-1
<PAGE> 40
8.5 In the event that a participant or former participant shall have more
than one salary deferral account, employer contribution account, non-forfeitable
account, Stock Bonus Plan account, ESOP account or Salaried ESOP account, the
Administrator may in its sole discretion consolidate the multiple accounts into
a single account of the same type.
8-2
<PAGE> 41
ARTICLE IX
----------
WITHDRAWALS FROM ACCOUNTS
-------------------------
9.1 Withdrawals made pursuant to this Article shall be subject to the
following restrictions:
(a) the minimum amount of any such withdrawal shall be the lesser of
an amount set by the Administrator or the total of the vested
account balances which are subject to withdrawal pursuant to this
Article;
(b) the withdrawing participant shall make a written application on a
form provided by the Administrator or shall follow such procedures
as shall be specified by the Administrator from time to time and
shall designate the investments that are to be liquidated to
permit the making of such withdrawal;
(c) any withdrawal shall be made in a single lump sum payment of cash
in accordance with Article XV hereof;
(d) any withdrawal shall be made in accordance with the provisions of
Section 26.11 hereof;
(e) no amounts withdrawn pursuant to this Article may be recontributed
to this Trust and Plan; and
(f) any withdrawal shall be subject to such other reasonable and
uniform rules and regulations, consistently applied, as may be
established from time to time by the Administrator.
9.2 Subject to Section 9.1 hereof, on or after the date a participant
attains age fifty-nine and one-half (59-1/2) or becomes permanently and totally
disabled, such participant may withdraw all or a portion of his salary deferral
account balance. Prior to the date on which a participant attains age fifty-nine
and one-half (59-1/2) or becomes permanently and totally disabled, such
participant may withdraw from his salary deferral account only in the case of
hardship as provided in Article X hereof.
9.3 Subject to Section 9.1 hereof, on or after the earlier of the April 1
following the end of the calendar year in which the participant attains age
seventy and one-half
9-1
<PAGE> 42
(70-1/2) or the date a participant becomes permanently and totally disabled,
such participant may withdraw all or a portion of his employer contribution
account balance; provided, however, that in the case of a participant who is not
permanently and totally disabled only the vested portion of the employer
contribution account may be withdrawn. Prior to the earlier of the April 1
following the end of the calendar year in which a participant attains age
seventy and one-half (70-1/2) or the date on which a participant becomes
permanently and totally disabled, such participant may withdraw from his
employer contribution account only in the case of hardship as provided in
Article X hereof.
9.4 Subject to Section 9.1 hereof, on or after the earlier of the April 1
following the end of the calendar year in which the participant attains age
seventy and one-half (70-1/2) or the date a participant becomes permanently and
totally disabled, such participant may withdraw all or a portion of his
non-forfeitable account balance and all or a portion of his Stock Plan account
balances. Prior to the earlier of the April 1 following the end of the calendar
year in which a participant attains age seventy and one-half (70-1/2) or the
date on which a participant becomes permanently and totally disabled, such
participant may withdraw from his non-forfeitable account only in the case of
hardship as provided in Article X hereof and may not withdraw from his Stock
Plan accounts.
9.5 Upon an attempt by a participant to use his interest in this Trust
and Plan as security for any type of obligation, or to alienate, dispose of or
in any manner encumber, or upon an attempt by any third person to attach, levy
upon or in any manner convert the use or enjoyment of any such interest of a
participant, the right to withdraw any portion thereof pursuant to this Article
shall automatically terminate.
9-2
<PAGE> 43
9.6 A participant may not withdraw his account balances prior to his
retirement or termination of employment except as provided in this Article and
in Article X hereof.
9.7 No withdrawals were made by participants during Transition Period No.
1. Similarly and notwithstanding anything contained in this Article to the
contrary, no withdrawals shall be made by participants from Stock Plan accounts
during Transition Period No. 2.
9-3
<PAGE> 44
ARTICLE X
---------
HARDSHIP DISTRIBUTIONS
----------------------
10.1 Subject to such uniform rules and procedures as the Administrator
may prescribe, in the case of hardship, a participant may apply to the
Administrator for a hardship distribution. For the purposes of this Section, a
distribution shall be on account of hardship only if the distribution is made on
account of an immediate and heavy financial need of the participant, as
described in Section 10.2 hereof, and is necessary, as described in Section 10.3
hereof, to satisfy such need. Such distribution shall be made only from the
accounts specified in Section 10.4 hereof.
10.2 A distribution will be made on account of an immediate and heavy
financial need of a participant only if the distribution is on account of:
(a) the need to prevent the eviction of the participant from his
principal residence or foreclosure on the mortgage of the
participant's principal residence;
(b) purchase (excluding mortgage payments) of a principal residence
for the participant;
(c) medical expenses described in Section 213(d) of the Code incurred
by the participant, the participant's spouse, or any dependents of
the participant (as defined in Section 152 of the Code); or
(d) payment of tuition for the next twelve (12) months of
post-secondary education for the participant, his or her spouse,
children or dependents.
10.3 A distribution will be deemed to be necessary to satisfy an
immediate and heavy financial need of a participant only if all of the following
requirements are satisfied:
(a) the distribution is not in excess of the amount of the immediate
and heavy financial need of the participant, including any amounts
necessary to pay any federal, state or local income taxes or
penalties reasonably anticipated to result from such distribution;
(b) the participant has obtained all distributions, other than
hardship distributions, and all nontaxable (at the time of the
loan) loans currently
10-1
<PAGE> 45
available under this Trust and Plan and all other plans maintained
by the Company or any affiliates, unless such distribution or loan
would have the effect of increasing the amount of the financial
need;
(c) this Trust and Plan and all other plans maintained by the Company
or any affiliates provide that the participant may not make salary
deferral contributions for the participant's taxable year
immediately following the taxable year of the participant during
which said hardship distribution occurs in excess of the
applicable limit under Section 402(g) of the Code for such next
taxable year of the participant less the amount of such
participant's salary deferral contributions for the taxable year
of the participant during which said hardship distribution occurs;
and
(d) the participant is prohibited under the terms of this Trust and
Plan and all other plans maintained by the Company or any
affiliates (or other legally enforceable agreement), from making
salary deferral contributions and voluntary after-tax
contributions, if applicable, to this Trust and Plan and such
other plans for at least twelve (12) months after receipt of the
hardship distribution.
By virtue of this Section and Section 5.4 hereof, this Trust and
Plan provides for the restrictions contained above in subparagraphs (c) and (d).
10.4 If the Administrator determines that the criteria set forth in
Sections 10.2 and 10.3 hereof have been satisfied with respect to a participant,
it may order a distribution of all or a portion of the sum of:
(a) such participant's employer contribution account balance
multiplied by his vested percentage;
(b) such participant's non-forfeitable account balance; and
(c) the lesser of:
(i) his salary deferral account balance; and
(ii) the sum of the aggregate amount of the contributions made
to his salary deferral account, without earnings thereon.
No distributions shall be made from a participant's Stock Plan accounts pursuant
to this Article.
10-2
<PAGE> 46
Such distribution shall be made in a cash lump sum and shall be made in
accordance with the provisions of Section 26.11 hereof. Any distribution from a
participant's accounts under this Article shall be deemed to be made in the
following order:
(a) first, from his salary deferral account;
(b) second, from his non-forfeitable account; and
(c) third, from the vested portion of his employer contribution
account.
If the Administrator directs that a distribution be made hereunder, it
may thereafter, if it determines that such hardship no longer exists or is no
longer imminent or upon agreement with the participant, direct that any such
distribution not yet made not be made. Amounts distributed to a participant
under this Section shall be debited to the appropriate account or accounts as
they are paid.
10.5 Neither the application for nor payment of any distribution in
accordance with this Article shall have the effect of terminating a
participant's participation in this Trust and Plan. The Administrator may
prescribe the use of such forms, conduct such investigation, and require the
making of such representations and warranties, as it deems desirable to carry
out the purpose of this Article.
10.6 No hardship distributions were made to participants during
Transition Period No. 1.
10-3
<PAGE> 47
ARTICLE XI
----------
LOANS
-----
11.1 A participant or a former participant who is a "party in interest"
within the meaning of ERISA Section 3(14) may apply to the Administrator for a
loan from this Trust and Plan; provided, however, that loans shall not be made
available to highly compensated employees in an amount greater than the amount
made available to employees who are not highly compensated employees. If the
Administrator determines that such borrower (and proposed loan) satisfies the
requirements set forth below for loan approval, the Administrator shall direct
the Trustee to make a loan to such borrower from one or more of his accounts,
other than his Stock Plan accounts. The amount of any such loan shall be
determined by the Administrator; provided, however, that any such loan shall
not, when combined with outstanding loans previously made from this Trust and
Plan and loans made under other qualified retirement plans maintained by the
Company or any affiliate, cause the aggregate amount of all such loans to such
borrower to exceed the lesser of (a) or (b) below, where:
(a) equals one-half (1/2) of all vested account balances held for such
borrower under this Trust and Plan; and
(b) equals Fifty Thousand Dollars ($50,000.00) reduced by the
remainder, if any, of:
(i) the highest outstanding balance of loans to such borrower
from this Trust and Plan and all other qualified retirement
plans maintained by the Company or any affiliate during the
twelve (12) month period preceding the date on which the
loan is to be made; minus
(ii) the outstanding balance of loans to such borrower from the
plans on the day the loan is to be made.
The following additional provisions shall be applicable to the loan
program under this Trust and Plan:
11-1
<PAGE> 48
(A) LOAN PROGRAM ADMINISTRATION. The loan program under this
Trust and Plan shall be administered by the Administrator.
(B) LOAN APPLICATION PROCEDURE. Each borrower shall apply for a
loan by written application on a form acceptable to the
Administrator.
(C) BASIS FOR APPROVAL OR DENIAL OF LOANS. Loans will be
approved only if:
(I) the Administrator believes the borrower intends to
repay the loan in accordance with its terms; and
(II) the borrower's spouse, if any, consents in writing
to the loan and the use of the borrower's account
balances as security for the loan in accordance with
Section 26.5 or 26.6 hereof within the ninety (90)
day period ending on the date the loan is made and
secured; and
(III) the amount of such loan shall not be in excess of
the borrower's vested account balances, other than
his Stock Plan account balances, at the time of such
loan; and
(IV) the amount of such loan shall not be less than One
Thousand Dollars ($1,000.00); and
(V) the loan satisfies the requirements of Section 11.2
hereof.
(D) ONE (1) OUTSTANDING LOAN. A borrower may only have one (1)
loan from this Trust and Plan outstanding at any time.
11.2 Any loan made pursuant to Section 11.1 hereof shall be considered to
be made solely from the account or accounts of the borrower, other than his
Stock Plan accounts, and shall be subject to the following terms and conditions:
(a) INTEREST. Interest shall be charged at a reasonable rate fixed by
the Administrator at the time the loan is approved. The interest
rate used shall be the interest rate that would be charged at the
time of the loan application by the Trustee in its capacity as a
bank for a fully collaterized loan for which the bank has
possession of the collateral.
11-2
<PAGE> 49
(b) LOAN TERM AND REPAYMENT SCHEDULE. The term of any loan shall be
arrived at by mutual agreement between the borrower and the
Administrator but shall not exceed five (5) years, unless the
proceeds of such loan are to be used to acquire any dwelling unit
which within a reasonable time is to be used as the borrower's
principal residence, in which case, such loan may be for such term
as is customary in similar transactions involving lending
institutions. Notwithstanding the preceding sentence, any such
loan shall become immediately due and payable upon a borrowing
participant's termination of employment.
All loans shall provide for the substantially level amortization
of the loan, with payments not less frequently than quarterly,
over the term of the loan; provided, however, that the terms of
the loan may permit a borrower a grace period of up to one (1)
year from such repayments while such borrower is on an unpaid
leave of absence from the Company or an affiliate.
(c) SEGREGATION OF ACCOUNTS. If an individual borrows money from this
Trust and Plan, his accounts, to the extent of such borrowing,
shall be deemed segregated for investment purposes. The note
representing such loan and the borrower's accounts, to the extent
of such borrowing, shall not be taken into account in the
valuation of this Trust and Plan's investment funds pursuant to
Section 7.4 hereof.
(d) REPAYMENT PROCEDURES. Repayment of any loan made to a participant
shall be by payroll deduction unless another procedure is agreed
to by the Administrator and the participant. Repayment of any loan
made to a borrower who is not a participant shall be made as
mutually agreed by the Administrator and such borrower.
(e) DOCUMENTATION AND COLLATERAL. Each loan shall be evidenced by a
borrower's note for the amount of the loan and interest payable to
the order of the Trustee and shall be supported by adequate
collateral. Such collateral shall consist of an amount not to
exceed fifty percent (50%) of the borrower's entire right, title
and interest in and to the Trust Fund, and any earnings
attributable to such amount. The Administrator may require such
other and further documentation as it deems appropriate.
(f) DEFAULT. The Administrator shall designate certain occurrences as
"events of default." Events of default may include, but shall not
be limited to, the following:
(i) failure of the borrower to make a required payment of
principal or interest under the loan;
(ii) termination of this Trust and Plan;
(iii) sale of the Division which employs the borrower; and
11-3
<PAGE> 50
(iv) the borrower's termination of employment or death.
If an event of default occurs with respect to a borrower, such
borrower's loan shall be accelerated and shall become due and
payable as of the date specified by the Administrator. If a
required payment of principal or interest is not made by the end
of the calendar quarter which next follows the calendar quarter in
which the event which triggers the default occurs or if a required
payment is not made after a permitted one (1) year grace period,
as provided in subparagraph (b) above, the loan shall be in
default and the outstanding loan balance shall be deemed to be
distributed to the borrower or his beneficiary or estate, as
applicable.
Expenses of collection, including legal fees, if any, of any loan
in default shall be borne by the borrower or his accounts under
this Trust and Plan.
11.3 Notwithstanding the foregoing provisions of Sections 11.1 and 11.2
hereof, in the event the proceeds of any loan made hereunder shall be used
directly or indirectly to pay off any obligations under a prior loan made
hereunder, the term of the more recent loan shall not extend beyond the period
of repayment under the prior loan. For purposes of this Section, the
Administrator shall be able to rely on a certification by the borrower as to the
use of the new loan's proceeds.
11.4 No loans were made during Transition Period No. 1.
11-4
<PAGE> 51
ARTICLE XII
-----------
TERMINATION OF EMPLOYMENT
-------------------------
12.1 In the event of the termination of employment of a participant for
any reason other than death or retirement, he shall be entitled to receive a
distribution of his vested interest.
12.2 The vested interest of a terminated participant shall be distributed
to him in accordance with the rules and procedures set forth in Article XV
hereof. Except as otherwise provided in Article XV hereof, such distribution
shall be made on such date on or after his date of termination of employment as
shall be directed by the terminated participant in his sole discretion;
provided, however, that such distribution need not be made earlier than
administratively possible. Notwithstanding anything contained in this Trust and
Plan to the contrary, if a participant has a termination of employment pursuant
to Section 2.42(g) hereof that does not meet the requirements of Section
401(k)(10) of the Code, such participant shall not be eligible to receive a
distribution from this Trust and Plan until he terminates employment with the
person, entity or joint venture acquiring the business unit or facility with
which he was employed.
12.3 If a terminated participant's vested percentage is one hundred
percent (100%), his employer contribution account shall be deemed to have become
a non-forfeitable account on his date of termination of employment and shall
thereafter be held, administered and distributed in accordance with Articles
VIII and XV hereof. If his vested percentage is greater than zero (0) but less
than one hundred percent (100%), such account shall continue to be administered
as such in accordance with the provisions of Articles VIII and XV hereof until
the earliest to occur of any of the following events:
12-1
<PAGE> 52
(a) he receives a distribution of his entire vested interest;
(b) he has five (5) year period of severance;
(c) he dies; or
(d) he is rehired by the Company or an affiliate.
If the earliest to occur of said events is either the date of complete
distribution of his vested interest, his having had a five (5) year period of
severance or his death, the excess of:
(i) his account balances; over
(ii) his vested interest;
shall be forfeited as of such date and shall be debited to his employer
contribution account. If an account balance remains credited to his employer
contribution account after said forfeiture, such employer contribution account
shall thereafter be deemed to have become a non-forfeitable account and shall be
held, administered and distributed in accordance with Articles VIII and XV
hereof. If a participant terminates employment at a time when his vested
interest is zero (0), such terminated participant shall be deemed to have
received a lump sum distribution from this Trust and Plan in such zero (0)
amount in full discharge of this Trust and Plan's liability with respect to his
retirement benefits and his employer contribution account balance, if any, shall
be forfeited pursuant to this Section. Such distribution and forfeiture shall be
deemed to have occurred on the date of termination of employment of such
terminated participant.
If the earliest of said events shall be the terminated participant's
rehire by the Company or an affiliate, he shall immediately be reinstated as a
participant in this Trust and Plan and this Article shall not apply to him until
a subsequent termination of employment described in Section 12.1 hereof.
12.4 Forfeitures pursuant to Section 12.3 hereof shall be used following
the date of forfeiture to reduce the contributions of the Company under Article
VI hereof.
12-2
<PAGE> 53
12.5 If a terminated participant shall be rehired by the Company or any
affiliate, he shall immediately be reinstated as a participant in this Trust and
Plan. If a terminated participant shall be rehired by the Company or any
affiliate at a time when his period of severance is five (5) or more years, no
portion of his employer contribution account balance under this Trust and Plan
or any of the Stock Plans which was forfeited and debited pursuant to the
provisions of this Trust and Plan or any provisions of the Stock Plans shall be
recredited to his accounts. If a terminated participant shall be rehired by the
Company or any affiliate at a time when his period of severance is less than
five (5) years, the portion of his employer contribution account balance under
this Trust and Plan which was forfeited and debited pursuant to the provisions
of this Trust and Plan shall be recredited to his employer contribution account
and the portion of his employer contribution account balance under the Stock
Plans which was forfeited and debited pursuant to the provisions of the Stock
Plans shall be recredited to his Stock Plan account provided that such
participant recontributes to this Trust and Plan on or before the first to occur
of:
(a) the date he incurs a five (5) year period of severance; and
(b) the fifth (5th) anniversary of his date of rehire;
an amount equal to the value of the portion of his employer contribution
account(s) which was distributed to him following his earlier termination of
employment. Such recontributed amounts shall be credited to employer
contribution accounts if they represent amounts previously distributed from this
Trust and Plan and shall be credited to Stock Plan accounts if they represent
amounts previously distributed from the Stock Plans. Notwithstanding any other
provision of this Trust and Plan to the contrary, in order to balance the
accounts maintained under this Trust and Plan, after giving effect to the
recrediting of prior forfeitures to a rehired participant's employer
contribution account and/or Stock Plan account, the Administrator shall use any
12-3
<PAGE> 54
forfeitures which have not theretofore been used to reduce the contributions of
the Company to this Trust and Plan. To the extent that the forfeitures are less
than the aggregate prior forfeitures which were recredited during the plan year
to the employer contribution accounts and Stock Plan accounts of participants
who were rehired, the Company shall contribute to this Trust and Plan an amount
equal to the difference between the aggregate prior forfeitures which were
recredited during the plan year to the employer contribution accounts and Stock
Plan accounts of participants who were rehired. The Company, at its option, may
also contribute the aggregate prior forfeitures which were recredited during the
plan year to the employer contribution accounts and Stock Plan accounts of
participants who were rehired. Such contribution shall be made by the Company no
later than the due date (including extensions) of the tax return for the taxable
year which includes the last day of the plan year during which such participants
were rehired. Such contribution shall be made in cash by the Company. For
purposes of the limitations contained in Article XXII hereof, such contribution
shall not be deemed to have been contributed at the time it is recontributed
pursuant to this Section, but shall be deemed to have been contributed at the
time of the original contribution.
12-4
<PAGE> 55
ARTICLE XIII
------------
RETIREMENT BENEFITS
-------------------
13.1 The employer contribution account of a participant who has attained
his normal retirement date shall be fully vested and nonforfeitable. A
participant who retires from the employ of the Company or an affiliate on his
normal retirement date shall be entitled to receive a distribution of his
account balances. Such distribution shall be made in accordance with the
provisions of Article XV hereof.
13.2 In the event a participant works for the Company or an affiliate
beyond his normal retirement date, his retirement date shall be deemed to have
occurred on the date of his termination of employment with the Company or an
affiliate for any reason other than death.
Such participant shall be entitled to receive a distribution of his
account balances. Such distribution shall be made in accordance with the
provisions of Article XV hereof.
13.3 Except as otherwise provided in Article XV hereof, distribution of
the accounts of a participant who retires in accordance with the provisions of
this Article shall be made on such date on or after his date of retirement as
shall be directed by the participant in his sole discretion; provided, however,
that such distribution need not be made earlier than administratively possible.
13.4 As of the date of retirement of a participant his employer
contribution account shall be deemed to have become a non-forfeitable account
and shall thereafter be held, administered and distributed in accordance with
Articles VIII and XV hereof.
13-1
<PAGE> 56
ARTICLE XIV
-----------
DEATH BENEFITS
--------------
14.1 In the event of the termination of employment of a participant by
reason of his death, his death beneficiary shall, except as otherwise provided
in Sections 15.3 and 15.4 hereof, be entitled to receive a distribution on such
date after such death occurs as he shall select in his sole discretion. Such
distribution shall be equal to the deceased participant's account balances. As
of the date of death of such a participant, his employer contribution account
shall become fully vested and nonforfeitable and shall be deemed to have become
a non-forfeitable account. All accounts of the deceased participant shall be
held, administered and distributed in accordance with Articles VIII and XV
hereof.
14.2 In the event of the death of a retired or terminated participant
prior to the date distribution has been made to him, his death beneficiary
shall, except as otherwise provided in Sections 15.3 and 15.4 hereof, be
entitled to receive a distribution on such date after such death occurs as he
shall select in his sole discretion. Such distribution shall be equal to the
deceased participant's vested interest in his accounts after the debiting of his
employer contribution account by any forfeiture specified in Section 12.3
hereof. The vested interest of a retired or terminated participant shall not
increase as a result of his death. All accounts of the deceased participant
shall be held, administered and distributed in accordance with Articles VIII and
XV hereof.
14.3 In the event of the death of a retired or terminated participant
after distribution has been made to him, no benefits shall be payable to his
death beneficiary.
14.4 Unless a participant or former participant has designated a death
beneficiary in accordance with the provisions of Section 14.5 hereof, his death
beneficiary shall
15-1
<PAGE> 57
be deemed to be the person or persons in the first of the following classes in
which there are any survivors of such participant:
(a) his spouse at the time of his death;
(b) his issue, per stirpes;
(c) his parents; and
(d) the executor or administrator of his estate.
14.5 In lieu of having the benefit distributable pursuant to this Article
distributed to a death beneficiary determined in accordance with the provisions
of Section 14.4 hereof, a participant or former participant may sign a document
designating a death beneficiary or death beneficiaries to receive such benefit.
If the participant or former participant is married, any such designation shall
be effective only if his spouse is the sole primary beneficiary or consents to
such other designation in accordance with Section 26.5 hereof.
14.6 Upon the death of a participant or a former participant, the
Administrator shall immediately advise the Trustee of the identity of such
participant's or former participant's death beneficiary or beneficiaries. The
Trustee shall be completely protected in making distributions to any person or
persons in any sums in accordance with the instructions it receives from the
Administrator.
14.7 In the event that a participant or former participant dies at a time
when he has a designation on file with the Administrator which does not dispose
of the total benefit distributable under this Trust and Plan upon his death,
then the portion of such benefit distributable on behalf of said participant or
former participant, the disposition of which was not determined by the deceased
participant's or former participant's designation, shall be distributed to a
death beneficiary determined under the provisions of Section 14.4 hereof.
15-2
<PAGE> 58
14.8 Any ambiguity in a participant's or former participant's death
beneficiary designation shall be resolved by the Administrator. Subject to
Section 14.5 hereof, the Administrator may direct a participant or former
participant to clarify his designation and if necessary execute a new
designation containing such clarification.
15-3
<PAGE> 59
ARTICLE XV
----------
DISTRIBUTIONS
-------------
15.1 Distributions will be made as of the dates specified in Articles
XII, XIII and XIV hereof. Each participant, former participant and beneficiary
who is eligible for benefits under Article XII, XIII or XIV hereof shall apply
therefor on a form which shall be given to him for that purpose by the
Administrator and further provided that the foregoing requirement shall not
apply in any case in which a participant, former participant or beneficiary
shall be unable, for physical, mental or any other reason satisfactory to the
Administrator to make such application. Upon finding that such participant,
former participant or beneficiary satisfies the eligibility requirements for
benefits under Article XII, XIII or XIV hereof, the Administrator shall promptly
notify the Trustee in writing, or by such other procedures as shall be
established by the Administrator from time to time, of his eligibility and of
the method of distribution selected in accordance with this Article.
15.2 The normal method of distribution of the vested account balances
distributable to a participant, former participant or beneficiary pursuant to
Article XII, XIII or XIV hereof shall be for the Trustee to sell any Shares and
any other assets credited to his accounts as of the date distribution is to be
made and to distribute the portion of the proceeds attributable to his vested
account balances in a single lump sum payment of cash; provided, however, that a
participant or former participant may elect to receive a single distribution of
the whole Shares credited to his accounts and attributable to his vested account
balances, together with cash in an amount equal to the balance of his vested
account balances. Any distribution shall be made in accordance with the
provisions of Section 26.11 hereof.
16-1
<PAGE> 60
15.3 In the event that the value of a retired, terminated or deceased
participant's vested account balances does not exceed Five Thousand Dollars
($5,000.00) at the time of distribution, or at the time of any prior
distribution, the Administrator shall direct the Trustee to distribute his
vested account balances in a single lump sum payment without the consent of the
participant, his spouse or his beneficiary. Any such lump sum payment shall be
made in accordance with the provisions of Section 26.11 hereof. Unless such
participant elects to receive the whole Shares, if any, credited to his accounts
and attributable to his vested account balances, the Trustee shall sell any
Shares or other assets credited to his accounts as of the date distribution is
to be made and distribute the amount of his vested account balances in a single
lump sum payment of cash. Any such single lump sum payment shall be in full
settlement of such participant's, spouse's or beneficiary's rights under this
Trust and Plan.
15.4 Notwithstanding any other provisions of this Trust and Plan,
distributions made hereunder shall be subject to the following restrictions:
(a) in the case of a living participant or former participant,
distribution must be made on or before the April 1 following the
end of the calendar year in which he attains age seventy and
one-half (70-1/2) or retires, whichever is later;
(b) in the case of a deceased participant or former participant,
distributions after his death shall be made within five (5) years
of the date of his death; and
(c) in the case of a participant or former participant, a distribution
shall conform to the incidental death benefit requirements of
Section 1.401(a)(9)-2 of the Treasury Regulations.
15.5 As long as assets of this Trust and Plan remain credited to an
account of a participant, former participant or beneficiary, the Administrator
shall continue to maintain and administer said account in accordance with the
terms and provisions of this Trust and Plan.
16-2
<PAGE> 61
15.6 No distributions were made to participants, former participants or
beneficiaries during Transition Period No. 1. Similarly and notwithstanding
anything to the contrary contained in this Trust and Plan, no distributions
shall be made to participants, former participants or beneficiaries from Stock
Plan accounts during Transition Period No. 2.
16-3
<PAGE> 62
ARTICLE XVI
-----------
THE TRUSTEE, ITS POWERS AND DUTIES
----------------------------------
16.1 The Trustee shall not be obligated to institute any action or
proceeding to compel the Company to make any contributions to this Trust and
Plan, nor shall the Trustee be obligated to make any inquiry as to whether any
cash contributions or Share contributions deposited with it are the
contributions provided to be deposited under the terms of Articles V and VI
hereof. Except as provided in Article VII hereof, the Trustee shall invest any
monies received as cash dividends paid on Shares held in the Stock Plan accounts
in Shares as soon after their receipt as is possible without disrupting the
market for Shares or violating any federal or state securities laws. No purchase
of Shares by the Trustee shall be at a price in excess of the fair market value
of the Shares as reasonably determined by the Trustee. Notwithstanding the
foregoing, the Trustee shall not be obligated to acquire Shares if no Shares are
available for purchase at a purchase price which is less than or equal to their
fair market value. The Trustee shall keep books of account which shall show all
receipts and disbursements and a complete record of the operation of the Trust,
and the Trustee shall at least once a year and at such other times as the
Company or the Administrator shall so request render a report of the operation
of the Trust to the Company and the Administrator. The Trustee shall file with
the Internal Revenue Service such returns and other information concerning the
Trust Fund as may be required of the Trustee by the Code. The Trustee shall not
be obligated to pay any interest on any funds which may come into its hands. The
Trustee is a party to this Trust and Plan solely for the purposes set forth in
this instrument and to perform the acts herein set forth, and no obligation or
duty shall be expected or required of it except as expressly stated herein or in
ERISA. The Trustee may consult with counsel (who may or may not be counsel for
the Company) selected by the Trustee
16-1
<PAGE> 63
concerning any question which may arise with reference to its powers or duties
under this Trust and Plan, and the opinion of such counsel shall be full and
complete authority and protection in respect of any action taken, suffered or
omitted by the Trustee in good faith and in accordance with such opinion,
provided due care is exercised in the selection of such counsel.
16.2 The Trustee may resign from this Trust and Plan by mailing to the
Company a written notice of resignation addressed to the Company at the last
address of the Company on file with the Trustee, or by delivering such written
notice to the Company at such address. The Company may remove the Trustee by
written notice of such removal mailed to the Trustee at the last address of the
Trustee on file with the Company, or by delivering such written notice to the
Trustee at such address. Such resignation or removal shall take effect on the
date specified in the notice of resignation or removal, but not less than thirty
(30) days, nor more than sixty (60) days, following the date of mailing of such
notice or delivery of such notice if it be not mailed. Upon such resignation or
removal, the Trustee shall be entitled to its fees to the effective date of
resignation or removal and any and all costs or expenses paid or incurred by the
Trustee in connection with this Trust and Plan. In no event shall such
resignation or removal terminate this Trust and Plan, but the Company shall
forthwith appoint a successor Trustee to carry out the terms of this Trust and
Plan, which successor Trustee shall be any individual, trust company or bank
selected by the Company. In case of the resignation or removal of the Trustee,
the Trustee shall forthwith turn over to the successor Trustee all assets in its
possession, and copies of such records as may be necessary to permit the
successor Trustee to carry out its duties.
16.3 The expenses of administration of the Trust incurred by the Trustee,
including counsel fees and including Trustee's fees as such may from time to
time be agreed
16-2
<PAGE> 64
upon between the Company and the Trustee, shall be paid in any one of the
following manners as determined by the Company in its sole discretion:
(a) paid directly by the Company to the Trustee; or
(b) paid pro rata out of the investment funds of the Trust Fund.
Notwithstanding the foregoing, in no event will any Trustee who is a full-time
employee of the Company or any affiliate receive compensation from this Trust
and Plan, except for expenses properly and actually incurred. Fees and expenses
of the Trustee which have not been paid will be deemed to be a lien upon the
Trust Fund.
16.4 Any segregation of assets required under this Trust may be made in
cash or in kind, or partly in cash and partly in kind, according to the
discretion of the Trustee, but any such segregation shall be made on the basis
of the most recent valuation made pursuant to Section 7.4 hereof.
16.5 In the event that the Company shall have appointed more than one
individual, trust company or bank to act jointly as Trustee hereunder, any
action which this Trust and Plan authorizes or requires the Trustee to do shall
be done by action of the majority of the then acting trustees, or, in the case
of two (2) such persons acting jointly as Trustee, by action of both such
trustees. Such action may be taken at any meeting of the trustees then acting,
or by written authorization and affirmative consent without a meeting. The
trustees by written agreement among themselves, a copy of which shall be filed
with the Company and the Administrator, may allocate among themselves any of the
powers and duties of the Trustee under this Trust and Plan. In such event the
trustee to whom a power or duty is allocated may take action with respect
thereto without the consent of any other trustee. Any person, firm, partnership
or corporation may rely upon the written signatures of such number of the
trustees as are hereunder empowered to take action as the signature of the
Trustee hereunder.
16-3
<PAGE> 65
Notwithstanding any other provision of this Trust and Plan to the contrary, so
long as at least one individual, trust company or bank shall continue to act as
Trustee hereunder, the Company shall not be under any duty to appoint a
successor to any trustee who shall resign or be removed.
16.6 In the event the Shares are not readily tradeable on an established
securities market and it is necessary to make a determination under this Trust
and Plan as to the fair market value of any Shares, the Trustee shall rely on a
valuation of the Shares by an independent appraiser who meets requirements
similar to the requirements of the regulations prescribed under Section
170(a)(1) of the Code.
16.7 To the maximum extent permitted by ERISA and to the extent there is
no self-dealing, negligence, embezzlement, criminal act, or violation of the
duty to keep the assets of this Trust and Plan safe on the part of the Trustee,
its officers, employees or agents, the Company shall indemnify the Trustee and
its officers, employees and agents if the Trustee or its officers, employees or
agents are made a party, or are threatened to be made a party, to any
threatened, pending, or completed action, suit or proceeding, whether civil,
administrative, or investigative (including any such action by or in the right
of the Company), by reason of the fact that the Trustee or its officers,
employees or agents acted in a fiduciary capacity under this Trust and Plan,
against expenses (including attorney's fees) judgments, fines, and amounts paid
in settlement actually and reasonably incurred by the Trustee, its officers,
employees or its agents in connection with such action, suit, or proceeding.
Reasonable expenses incurred in defending any such action, suit, or proceeding
shall be paid by the Company in advance of a final disposition of such action,
suit, or proceeding, upon presentation of the statements for such expenses to
the Company subject to the right of the Company to recover such payments if it
is subsequently determined as a part of the final disposition of such action
that there was self-dealing,
16-4
<PAGE> 66
negligence, embezzlement, criminal act, or violation of the duty to keep the
assets of this Trust and Plan safe on the part of the Trustee, its officers,
employees or agents. This indemnification shall not apply to any excise taxes
assessed against the Trustee with respect to any prohibited transaction where
the Trustee was the party in interest dealing with this Trust and Plan.
16-5
<PAGE> 67
ARTICLE XVII
------------
INVESTMENT MANAGEMENT
---------------------
17.1 In addition to the powers and duties conferred and imposed upon the
Trustee by the other provisions of this Trust and Plan, the Trustee shall,
subject to the provisions of Articles VII and XXV hereof and the limitations
hereinafter set forth in this Article, have the following powers and duties:
(a) To invest and reinvest the principal and income of the Trust Fund and
keep the same invested with the care, skill, prudence and diligence under the
circumstances then prevailing that a prudent man acting in a like capacity and
familiar with such matters would use in the conduct of an enterprise of like
character and with like aims, without distinction between principal and income
and without regard to any limitations, other than such prudent man rule,
prescribed by law or custom upon the investments of fiduciaries, in each and
every kind of property, whether real, personal or mixed, tangible or intangible,
and wherever situated, any deposit administration contract, investment contract
or other contract issued by an insurance company, shares of any Regulated
Investment Company, units of any common trust fund of any bank or trust company
now in existence or hereafter established, shares of common, preference and
preferred stock, put and call options, rights, options, subscriptions, warrants,
trust receipts, investment trust certificates, mortgages, leases, bonds, notes,
debentures, equipment or collateral trust certificates and other corporate,
individual or government obligations, whether secured or unsecured; to invest
and reinvest in and retain any stocks, bonds or other securities of any
corporate trustee serving hereunder, or any parent or affiliate thereof; to
invest in commodities and commodity contracts; to invest and reinvest in any
time or savings deposits of the Trustee or any parent or affiliate thereof if
such deposits bear a reasonable rate of interest or of any bank, trust company,
or savings and loan institution, which deposits may but need not be guaranteed
by the Federal Deposit Insurance Corporation or the Federal Savings and Loan
Insurance Corporation; and in addition to become a general partner or limited
partner in any partnership or limited partnership the purposes of which are to
invest or reinvest the partnership assets in any such properties or deposits;
(b) To invest a portion or all of the Trust Fund in units of any common
or group trust created solely for the purpose of providing a satisfactory
diversification of investments for participating trusts; provided that such
common or group trust, (i) limits participation thereunder to pension and profit
sharing trusts which qualify under Section 501(a) of the Code, (ii) prohibits
income and/or principal attributable to a participating trust from being used
for any purpose other than the exclusive benefit of the employees or their
beneficiaries of such participating trust, (iii) prohibits assignment by a
participating trust of any part of such participating trust's equity or interest
in the common or group trust, (iv) is created or organized in the United States
and is maintained at all times as a domestic trust in the United States; as long
as the Trustee holds such units hereunder, the instrument establishing such
common or group
17-1
<PAGE> 68
trust (including all amendments thereto) shall be deemed to have been adopted
and made a part of this Trust and Plan;
(c) Upon direction by the Company, to invest or reinvest a portion of the
Trust Fund in qualifying employer securities and/or qualifying employer real
estate as such terms are defined in Section 4975 of the Code and Section 407(d)
of ERISA, which investment may constitute more than ten percent (10%) of the
fair market value of the assets of the Trust Fund, and to retain, or to sell,
exchange or otherwise dispose of any such securities or real estate held in the
Trust Fund. In the event of any such investment, the Trustee shall file with the
appropriate District Director of Internal Revenue such returns and other
information as shall be required from time to time by the Code;
(d) To sell, convert, redeem, exchange, grant options for the purchase or
exchange of, or otherwise dispose of, any real or personal property, at public
or private sale, for cash or upon credit, with or without security, without
obligation on the part of any person dealing with the Trustee to see to the
application of the proceeds of or to inquire into the validity, expediency or
propriety of any such disposal;
(e) To manage, operate, repair, partition and improve and mortgage or
lease (with or without option to purchase) for any length of time any real
property held in the Trust Fund; to renew or extend any mortgage or lease, upon
any terms the Trustee may deem expedient; to agree to reduction of the rate of
interest on any mortgage note; to agree to any modification in the terms of any
lease or mortgage or of any guarantee pertaining to either of them; to enforce
any covenant or condition of any lease or mortgage or of any guarantee
pertaining to either of them or to waive any default in the performance thereof;
to exercise and enforce any right of foreclosure; to bid on property on
foreclosure; to take a deed in lieu of foreclosure with or without paying
consideration therefor and in connection therewith to release the obligation on
the bond secured by the mortgage; and to exercise and enforce in any action,
suit or proceeding at law or in equity any rights or remedies in respect of any
lease or mortgage or of any guarantee pertaining to either of them;
(f) To exercise, personally or by general or limited proxy, the right to
vote any shares of stock, including Shares which are not held in accounts of
participants, former participants, beneficiaries and "alternate payees" (as
defined in Section 19.1(a) hereof), or other securities held in the Trust Fund;
to delegate discretionary voting power to trustees of a voting trust for any
period of time; and to exercise or sell, personally or by power of attorney, any
conversion or subscription or other rights appurtenant to any securities or
other property held in the Trust Fund, provided that in each instance described
in Section 17.4 hereof with respect to Shares held in accounts of participants,
former participants, beneficiaries and "alternate payees" (as defined in Section
19.1(a) hereof), such power and duty shall be subject to the direction of
participants, former participants, beneficiaries and "alternate payees" pursuant
to such Section 17.4;
(g) To join in or oppose any reorganization, recapitalization,
consolidation, merger or liquidation, or any plan therefor, or any lease (with
or without an option to purchase), mortgage or sale of the property of any
organization the securities of which are held in the Trust Fund; to pay from the
Trust Fund any assessments, charges or compensation specified in any
17-2
<PAGE> 69
plan of reorganization, recapitalization, consolidation, merger or liquidation,
to deposit any property with any committee or depositary; and to retain any
property allotted to the Trust Fund in any reorganization, recapitalization,
consolidation, merger or liquidation;
(h) To borrow money from any lender (including the Trustee hereunder,
where applicable in its capacity as a banking corporation when permitted to do
so by the applicable laws and regulations then in effect) in any amount and upon
such terms and conditions and for such purposes as the Trustee shall deem
necessary; for any money so borrowed the Trustee may issue its promissory note
as Trustee and to secure the repayment of any such loan, with interest, may
pledge or mortgage all or any part of the Trust Fund, and no person loaning
money to the Trustee shall be obligated to see to the application of the money
loaned or to inquire into the validity, expediency or propriety of any such
borrowing;
(i) To compromise, settle or arbitrate any claim, debt or obligation of
or against the Trust Fund; to enforce or abstain from enforcing any right,
claim, debt or obligation; and to abandon any property determined by it to be
worthless;
(j) To continue to hold any property of the Trust Fund whether or not
productive of income; to reserve from investment and keep unproductive of
income, without liability for interest, such cash as it deems advisable or, in
its discretion, to hold the same, without limitation on duration, on deposit in
the commercial department or in an interest-bearing account in the savings
department of any bank, trust company, or savings and loan institution
(including the Trustee where applicable in its capacity as a banking
corporation) in which deposits are guaranteed by the Federal Deposit Insurance
Corporation or the Federal Savings and Loan Insurance Corporation;
(k) To hold property of the Trust Fund in its own name or in the name of
a nominee, without disclosure of the Trust, or in bearer form so that it will
pass by delivery, but no such holding shall relieve the Trustee of its
responsibility for the safe custody and disposition of the Trust Fund in
accordance with the provisions of this Trust and Plan, and the Trustee's records
shall at all times show that such property is part of the Trust Fund;
(l) To make, execute and deliver, as Trustee, any deeds, conveyances,
leases (with or without option to purchase), mortgages, options, contracts,
waiver or other instruments that the Trustee shall deem necessary or desirable
in the exercise of its powers under this Trust and Plan;
(m) To employ, at the expense of the Trust Fund, agents who are not
regular employees of the Trustee, and to delegate in writing to them and
authorize them to exercise such powers and perform such duties required of the
Trustee hereunder without limitation as the Trustee may determine in its
uncontrolled discretion; the Trustee shall not be responsible for any loss
occasioned by any such agents selected by it with reasonable care;
(n) To pay out of the Trust Fund all taxes imposed or levied with respect
to the Trust Fund and in its discretion to contest the validity or amount of any
tax, assessment, penalty, claim or demand respecting the Trust Fund; however,
unless the Trustee shall have first been indemnified to its satisfaction or
arrangements satisfactory to it shall have been made for
17-3
<PAGE> 70
the payment of all costs and expenses, it shall not be required to contest the
validity of any tax, or to institute, maintain or defend against any other
action or proceeding either at law or in equity;
(o) Except as otherwise provided in this Trust and Plan, to do all acts,
execute all instruments, take all proceedings and exercise all rights and
privileges with relation to any assets constituting a part of the Trust Fund,
which it may deem necessary or advisable to carry out the purposes of this Trust
and Plan;
(p) During the minority or incapacity, in either case as determined under
applicable local law, of any participant, former participant or beneficiary
under this Trust and Plan, to make any distribution to which such person would
otherwise be entitled pursuant to this Trust and Plan either to such person or
to the legal guardian of such person, and the receipt of either such minor or
incapacitated person or such legal guardian shall be a full discharge and
acquittance to the Trustee for such distribution;
(q) To commingle the assets of the Trust Fund, other than shares of the
Company's Class A Common Stock or Class B Common Stock, with assets of other
trusts through the medium of the Company's Investment Trust for Retirement
Trusts established by the Company by an agreement dated and executed on December
31, 1968, investing and reinvesting the assets of the Trust Fund in units, of
such Investment Trust, created or hereafter created pursuant to said agreement,
and in such proportions as the Company may deem advisable from time to time,
acting in its sole discretion. To the extent of the equitable share of the Trust
Fund in such Investment Trust for Retirement Trusts, the agreement creating such
Trust as now constituted and as the same may be amended hereafter from time to
time and the Trust created thereby shall be deemed a part of this Trust and
Plan; and
(r) To commingle the assets of the Trust Fund with assets of other trusts
through the medium of the Company's Pooled Investment Trust For Participant
Directed Accounts established by the Company by an agreement dated and executed
on June 6, 1994, investing and reinvesting the assets of the Trust Fund in
units, of such Investment Trust, created or hereafter created pursuant to said
agreement, and in such proportions as the Company may deem advisable from time
to time, acting in its sole discretion. To the extent of the equitable share of
the Trust Fund in such Pooled Investment Trust For Participant Directed
Accounts, the agreement creating such Trust as now constituted and as the same
may be amended hereafter from time to time and the Trust created thereby shall
be deemed a part of this Trust and Plan.
17.2 Notwithstanding any provisions of this Trust and Plan, the Company
hereby retains the right to appoint, from time to time, one or more:
(a) banks, as defined in the Investment Advisers Act of 1940;
(b) persons registered as investment advisers under said Act; or
(c) insurance companies qualified to perform investment advisory
services under the laws of more than one state;
17-4
<PAGE> 71
to act as the Investment Manager or Managers of all or such portions of the
Trust Fund as the Company in its sole discretion shall direct. In order to serve
as Investment Manager, any such bank, person or insurance company must state in
writing to the Company and the Trustee that it meets the requirements set forth
in this Section to be an Investment Manager and that it acknowledges that it
shall be a fiduciary with respect to this Trust and Plan during all periods that
it shall serve as such. During any period that an Investment Manager has been
appointed with respect to the Trust Fund or a portion thereof, it shall have all
powers normally given to the Trustee under Section 17.1 hereof with respect to
the management, acquisition or disposition of any asset of the Trust Fund, or
such portion thereof and the Trustee shall have no powers, duties or obligations
with respect to the investment, management, acquisition or disposition of such
assets. The Company may, at any time, remove any Investment Manager or change
the portion of the Trust Fund subject to its management by written notice to the
Trustee and the Investment Manager. Any Investment Manager may resign by written
notice to the Company and the Trustee. Unless the Company appoints a successor
to an Investment Manager which has resigned or been removed, or which is no
longer managing a portion of the Trust Fund, the powers, duties and obligations
of the Trustee with respect to the portion of the Trust Fund formerly managed by
the Investment Manager shall be automatically restored.
17.3 All income from investment and reinvestment made as provided in this
Article shall be treated as principal, and investments and reinvestments shall
be made without distinction between income and principal.
17.4 It is the purpose of this Section to permit participants, former
participants, beneficiaries and "alternate payees" (as defined in Section
19.1(a) hereof) to exercise substantial
17-5
<PAGE> 72
ownership rights under this Trust and Plan with respect to Shares held in their
accounts under this Trust and Plan. Therefore, the power to direct the Trustee
regarding:
(a) the appropriate response to any tender or exchange offer made by
any person, including the Company, for the Company's Shares; or
(b) the exercise of the right to vote Shares with respect to any
matter on which such Shares may be voted;
is hereby granted to such participants, former participants, beneficiaries and
alternate payees pursuant to this Section with respect to the number of Shares
of Class A and Class B Common Stock held in their accounts. Each such person
shall, for purposes of Section 402(a)(2) of ERISA, be a "named fiduciary" with
respect to such power to direct the Trustee as to whether to tender or exchange
such Shares or as to the voting of such Shares as are subject to his direction
as hereinafter provided.
The power of direction hereinbefore described in this Section shall be
exercised as follows:
(a) The Company shall furnish each person who is eligible to direct
the Trustee with one or more documents for use in exercising such
direction;
(b) Such document or documents shall permit the person to exercise
such right with respect to:
(i) Class A Common Stock held in his accounts; and
(ii) Class B Common Stock held in his accounts;
(c) If such person shall timely direct the Trustee with respect to the
tender, exchange or voting of Shares held in his accounts, the
Trustee shall respond to the tender or exchange offer for such
Shares or shall exercise the right to vote such Shares in
accordance with such direction; but if he shall not so direct the
Trustee, the decision of whether the Shares subject to his
direction shall be tendered, exchanged or voted shall be made by
the Trustee in its sole discretion;
(d) If an account contains a fractional Share, such Share shall be
aggregated with Shares of the same type (i.e. Class A or Class B)
for which the
17-6
<PAGE> 73
tender, exchange or voting decision is the same, for tender, exchange or
voting purposes; but:
(i) for tender or exchange purposes, if there still remains a
fractional Share for which the decision was to tender or exchange,
such fractional Share shall be tendered or exchanged only if
permitted by the rules governing such tender or exchange and shall
not be tendered or exchanged if fractional Shares are not
permitted to be tendered or exchanged; or
(ii) for voting purposes, if there still remains a fractional Share,
such fractional Share shall be voted only if permitted by the
rules governing such voting and shall not be voted if fractional
Shares are not permitted to vote; and
(e) In order to protect the anonymity of participants and others eligible to
direct the Trustee with respect to the tender, exchange or voting of
Shares, the Administrator shall establish a procedure for tallying and
recording such directions which will not reveal to the Trustee, the
Company, any Participating Division or any affiliate of the Company, to
the extent reasonably practicable under the circumstances, the identity
of the participant or other person giving a particular direction.
17-7
<PAGE> 74
ARTICLE XVIII
-------------
ADMINISTRATION
--------------
18.1 The Administrator shall be responsible for the general
administration of this Trust and Plan and shall have all powers and duties
granted to or imposed upon an "administrator" by ERISA. The Administrator shall
have all such powers as may be necessary to carry out the provisions of this
Trust and Plan and may, from time to time, establish rules for the
administration of this Trust and Plan and the transaction of this Trust and
Plan's business. In making any rule or determination, the Administrator or its
representatives shall pursue uniform policies and shall not intentionally
discriminate in favor of or against any employee or group of employees. Without
limiting the foregoing, the Administrator shall have the following powers and
duties:
(a) To enact such rules, regulations, and procedures and to prescribe
the use of such forms as it shall deem advisable.
(b) To appoint or employ such agents, attorneys, actuaries, and
assistants at the expense of the Trust Fund, as it may deem
necessary to keep its records or to assist it in taking any other
action.
(c) To interpret this Trust and Plan, and to resolve ambiguities,
inconsistencies, and omissions, to determine any question of fact,
to determine the right to benefits of, and amount of benefits, if
any, payable to, any person in accordance with the provisions of
this Trust and Plan, and to decide questions of eligibility.
(d) To direct the Trustee to make payments of benefits as they become
due. Any such direction to the Trustee shall be in writing and
signed by an authorized representative of the Administrator or in
accordance with such other procedures as shall be established by
the Administrator from time to time.
18.2 An Appeals Committee consisting of three (3) or more members shall
be appointed by the Board of Directors of the Company to serve at the pleasure
of such Board of Directors. Members of the Committee may be officers, directors,
stockholders, or employees of
18-1
<PAGE> 75
the Company or an affiliate and may, but need not be, participants under this
Trust and Plan. The members of the Committee shall be reimbursed for expenses
incurred by them in the performance of their duties hereunder but shall serve
without compensation as such. The Committee shall appoint a Chairman from among
its members and may appoint a Secretary who may, but need not be, a member of
the Committee. The Secretary shall keep written minutes of the meetings and
actions of the Committee. Any action expressed from time to time by a vote at a
meeting, or expressed in writing, after notice to all members of the Committee,
may be done by a majority of the members of the Committee at the time acting
hereunder; and such action shall constitute the action of the Committee and
shall have the same effect for all purposes as if assented to by all the members
of the Committee at the time in office.
18.3 If any participant, any former participant, any beneficiary, or the
authorized representative of a participant, former participant or beneficiary
shall file an application for benefits hereunder and such application is denied
by the Administrator, in whole or in part, he shall be notified in writing of
the specific reason or reasons for such denial. The notice shall also set forth
the specific Trust and Plan provisions upon which the denial is based, an
explanation of the provisions of Section 18.4 hereof, and any other information
deemed necessary or advisable by the Administrator.
18.4 Any participant, any former participant, any beneficiary, or any
authorized representative of a participant, former participant or beneficiary
whose application for benefits hereunder has been denied, in whole or in part,
by the Administrator may upon written notice to the Committee request a review
by the Committee of such denial of his application. Such review may be made by
written briefs submitted by the applicant and the Administrator or at a hearing,
or by both, as shall be deemed necessary by the Committee. The Committee may, in
its sole
18-2
<PAGE> 76
discretion, appoint from its members an Appeal Examiner to conduct such
review. Any hearing conducted by an Appeal Examiner shall be held in such
location as shall be reasonably convenient to the applicant. Any hearing
conducted by the Committee shall be held in the Corporate Headquarters of the
Company, unless the Committee shall specify otherwise. The date and time of any
such hearing shall be designated by the Committee or the Appeal Examiner upon
not less than seven (7) days' notice to the applicant and the Administrator
unless both of them accept shorter notice. The Committee or the Appeal Examiner
shall make every effort to schedule the hearing on a day and at a time which is
convenient to both the applicant and the Administrator. The Committee may, in
its sole discretion, establish such rules of procedure as it may deem necessary
or advisable for the conduct of any such review or of any such hearing. After
the review has been completed, the Committee or the Appeal Examiner shall render
a decision in writing, a copy of which shall be sent to both the applicant and
the Administrator. In rendering its decision, the Committee or the Appeal
Examiner shall have full power and discretion to interpret this Trust and Plan,
to resolve ambiguities, inconsistencies and omissions, to determine any question
of fact, to determine the right to benefits of, and the amount of benefits, if
any, payable to, the applicant in accordance with the provisions of this Trust
and Plan. Such decision shall set forth the specific reason or reasons for the
decision and the specific Trust and Plan provisions upon which the decision is
based and, if the decision is made by an Appeal Examiner, the rights of the
applicant or the Administrator to request a review by the entire Committee of
the decision of the Appeal Examiner. Either the applicant or the Administrator
may request a review of an adverse decision of the Appeal Examiner by filing a
written request with the Committee within thirty (30) days after they receive a
copy of the Appeal Examiner's decision. The review of a decision of the Appeal
Examiner shall be
18-3
<PAGE> 77
conducted by the Committee in accordance with the procedures of this Section.
There shall be no further appeal from a decision rendered by a quorum of the
Committee.
18.5 The interpretations, determinations and decisions of the
Administrator, Appeal Examiner and Committee shall, except to the extent
provided in Section 18.4 hereof, be final and binding upon all persons with
respect to any right, benefit and privilege hereunder. Except as otherwise
provided in ERISA, the review procedures of said Section 18.4 shall be the sole
and exclusive remedy and shall be in lieu of all actions at law, in equity,
pursuant to arbitration or otherwise. In any event, a participant, former
participant or beneficiary must exhaust the review procedures of Section 18.4
hereof prior to the commencement of any such action.
18.6 The Company, Administrator, Appeal Examiner, Committee, Board of
Directors, Trustee and their respective officers, members, employees and agents
shall have no duty or responsibility under this Trust and Plan other than the
duties and responsibilities expressly assigned to them herein or delegated to
them pursuant hereto. None of them shall have any duty or responsibility with
respect to the duties or responsibilities assigned or delegated to another of
them. In no event shall the Company, Administrator, Appeal Examiner, Committee,
Board of Directors or their respective officers, members, employees and agents
be deemed to have any duty or responsibility with respect to the holding,
safekeeping, investment, reinvestment and administration of the Trust Fund.
18.7 Except as otherwise provided in ERISA, the Administrator, Committee,
Board of Directors, Appeal Examiner, and their respective officers and members
shall incur no personal liability of any nature whatsoever in connection with
any act done or omitted to be done in the administration of this Trust and Plan.
The Company shall indemnify, defend, and hold
18-4
<PAGE> 78
harmless the Administrator, Committee, Board of Directors, Appeal Examiner, and
their respective officers, employees, members and agents, for all acts taken or
omitted in carrying out their responsibilities under the terms of this Trust and
Plan or other responsibilities imposed upon such persons by ERISA. This
indemnification for all acts or omissions is intentionally broad, but shall not
provide indemnification for embezzlement or diversion of Trust funds for the
benefit of any such persons, nor shall it provide indemnification for excise
taxes imposed under Section 4975 of the Code. The Company shall indemnify such
persons for expenses of defending an action by a participant, beneficiary,
government entity, or other persons, including all legal fees and other costs of
such defense. The Company will also reimburse such a person for any monetary
recovery in a successful action against such person in any federal or state
court or arbitration. In addition, if the claim is settled out of court with the
concurrence of the Company, the Company shall indemnify such person for any
monetary liability under said settlement.
18-5
<PAGE> 79
ARTICLE XIX
-----------
PROHIBITION AGAINST ALIENATION
------------------------------
19.1 Unless the context otherwise indicates, the following terms used
herein shall have the following meanings whenever used in this Article:
(a) The words "alternate payee" shall mean any spouse, former spouse,
child or other dependent of a participant or former participant
who is recognized by a domestic relations order as having a right
to receive all, or a portion of, such participant's or former
participant's account balances.
(b) The words "domestic relations order" shall mean, with respect to
any participant or former participant, any judgment, decree or
order (including approval of a property settlement agreement)
which both:
(i) relates to the provisions of child support, alimony
payments or marital property rights to a spouse, former
spouse, child or other dependent of the participant or
former participant; and
(ii) is made pursuant to a State domestic relations law
(including a community property law).
(c) The words "qualified domestic relations order" shall mean a
domestic relations order which satisfies the requirements of
Section 414(p)(1)(A) of the Code.
19.2 Neither any property nor any interest in any property held for the
benefit of any participant, former participant or beneficiary shall be
alienated, disposed of or in any manner encumbered, voluntarily, involuntarily
or by operation of law, while in the possession or control of the Trustee except
by an act of the Trustee or the participant, former participant or beneficiary
specifically authorized hereunder.
19.3 Notwithstanding Section 19.2 hereof to the contrary, the following
shall not be treated as an assignment or alienation prohibited by said Section
19.2:
(a) the creation, assignment or recognition of a right to any benefit
payable with respect to a participant or former participant under
this Trust and Plan pursuant to a qualified domestic relations
order; or
19-1
<PAGE> 80
(b) the offset of a participant's or former participant's benefit
under this Trust and Plan against an amount that such participant
or former participant is ordered or required to pay to this Trust
and Plan where:
(i) the order or requirement to pay arises under a judgment for
a crime involving this Trust and Plan, a civil judgment,
consent order or decree for violation or alleged violation
of fiduciary duties as stated in part 4 of subtitle B of
title I of ERISA, or pursuant to a settlement agreement
between the Secretary of Labor or the Pension Benefit
Guaranty Corporation and the participant or former
participant for violation or alleged violation of fiduciary
duties as stated in part 4 of subtitle B of title I of
ERISA by a fiduciary or any other person; and
(ii) the judgment, order, decree, or settlement agreement
expressly provides for the offset of all or part of the
amount ordered or required to be paid to this Trust and
Plan against the participant's or former participant's
benefits provided by this Trust and Plan; and
(iii) to the extent, if any, that survivor annuity requirements
apply to distributions to the participant or former
participant under Code Section 401(a)(11), the rights of
such participant's or former participant's spouse are
preserved in accordance with Code Section
401(a)(13)(C)(iii); or
(c) any other arrangement, transfer or transaction which is not
treated as a prohibited assignment or alienation under Code
Section 401(a)(13) and the regulations thereunder or other
applicable law.
19.4 In the event this Trust and Plan is served with a domestic relations
order, the Administrator shall promptly notify the participant or former
participant and any alternate payee to whom such order relates of the receipt of
such order and this Trust and Plan's procedures for determining whether such
order is a qualified domestic relations order. Within a reasonable time after
receipt of such domestic relations order, the Administrator shall determine
whether such order is a qualified domestic relations order and shall notify the
participant or former participant and each alternate payee of its determination.
19.5 During any period in which the issue of whether a domestic relations
order is a qualified domestic relations order is being determined, the
Administrator shall direct the
19-2
<PAGE> 81
Trustee to credit the portion of the participant's or former participant's
account balances which would have been payable to an alternate payee during such
period if the order had been determined to be a qualified domestic relations
order during such period to a segregated account under this Trust and Plan and
to debit the appropriate accounts of the participant or former participant. If
the domestic relations order is determined to be a qualified domestic relations
order within eighteen (18) months after this Trust and Plan is served with such
domestic relations order, the Administrator shall hold and dispose of the
segregated account balance in accordance with the terms of the qualified
domestic relations order. If:
(a) it is determined that such domestic relations order is not a
qualified domestic relations order; or
(b) the issue with respect to whether such domestic relations order is
a qualified domestic relations order is not resolved within
eighteen (18) months after this Trust and Plan is served with such
domestic relations order;
the Administrator shall transfer the segregated account balance to the
appropriate accounts maintained for the benefit of the person who would have
been entitled to such segregated account balance if this Trust and Plan had
never been served with such domestic relations order. If eighteen (18) months
have elapsed since this Trust and Plan was served with such domestic relations
order and such order is subsequently determined to be a qualified domestic
relations order, such order shall only be applied prospectively.
19.6 The balance credited to any segregated account which has been
created under Section 19.5 hereof after this Trust and Plan has been served with
a domestic relations order shall be invested in such of the investment funds
established pursuant to Article VII hereof as the Administrator shall direct
until it is determined whether such domestic relations order is a qualified
domestic relations order.
19-3
<PAGE> 82
19.7 Any participant, former participant or alternate payee who is
affected by a domestic relations order served upon this Trust and Plan may, upon
written notice to the Committee appointed pursuant to Article XVIII hereof,
request a review by such Committee of the Administrator's determination with
respect to the qualification or lack of qualification of such domestic relations
order. Any such review by the Committee shall be subject to the rules and
procedures set forth in Article XVIII hereof.
19.8 Notwithstanding anything contained in this Trust and Plan to the
contrary, distribution of the vested portion of an alternate payee's segregated
account may be made to the alternate payee if such distribution is authorized by
a qualified domestic relations order, regardless of whether the affected
participant shall at such time be eligible for distribution under this Trust and
Plan. Where authorized by a qualified domestic relations order, distribution of
the vested portion of an alternate payee's interest in this Trust and Plan shall
be made in an immediate lump sum as soon as reasonably possible following the
receipt by the Administrator of the qualified domestic relations order. The
alternate payee shall, with respect to this Trust and Plan, to the extent of his
interest in this Trust and Plan, have such rights as are specified in the
qualified domestic relations order.
19-4
<PAGE> 83
ARTICLE XX
----------
AMENDMENT AND TERMINATION
-------------------------
20.1 This Trust and Plan may be modified, altered, amended, changed or
terminated by the Company at any time by action of its Board of Directors as
evidenced by an instrument in writing executed in the name of the Company by one
(1) or more duly authorized officers of the Company, but no vested benefits of
participants, former participants or beneficiaries receiving benefits under this
Trust and Plan and no other vested benefits under this Trust and Plan shall in
any way be reduced except that such benefits may be reduced if such a reduction
is necessary to continue the qualified status of this Trust and Plan under the
terms of Section 401 of the Code or its successor section or sections. This
Trust and Plan as amended and restated herein may be modified and amended
retroactively, if necessary, to secure exemption effective on the restatement
date under Section 401 of the Code. No amendment shall be binding on the Trustee
until the receipt of such amendment by the Trustee.
20.2 Upon termination of this Trust and Plan all assets of the Trust Fund
after deduction therefrom of any accrued expenses and fees of the Trustee and
any expenses and fees relating to such termination incurred or to be incurred by
the Trustee shall be allocated among the then existing accounts. Each such
account shall be adjusted in accordance with Section 7.4 hereof. All account
balances of participants and former participants at the time of termination of
this Trust and Plan shall be fully vested and nonforfeitable. Such account
balances shall be forthwith distributed to the participant or former participant
for whose benefit the accounts were established if he is living on the date of
termination, or if he shall have died before distribution, in accordance with
the provisions of Article XIV hereof.
20-1
<PAGE> 84
20.3 Upon the partial termination of this Trust and Plan or upon complete
discontinuance of contributions to this Trust and Plan by the Company, the
account balances of participants affected by such partial termination or
complete discontinuance shall be fully vested and nonforfeitable. However, after
any such partial termination or complete discontinuance of contributions, the
Administrator shall continue to administer this Trust and Plan in the manner in
which this Trust and Plan was administered before any such partial termination
and a participant shall only be entitled to receive benefits upon the occurrence
of an event which under the terms of this Trust and Plan would entitle him to
receive such benefits. For purposes of this Section, no event shall be a
"partial termination" unless: (a) the Company has so designated such event in a
writing delivered to the Trustee; or (b) such event has been finally and
expressly determined to be a partial termination within the meaning of Section
411(d) of the Code in an administrative or judicial proceeding to which both the
Company and the Commissioner of Internal Revenue or his delegate were parties.
20-2
<PAGE> 85
ARTICLE XXI
-----------
LIMITATIONS ON CONTRIBUTIONS
----------------------------
21.1 The amount and allocation of contributions under this Trust and
Plan, including any contributions made pursuant to a Supplemental Agreement,
shall be subject to several limitations. Those limitations are as follows:
(a) Salary deferral contributions shall be subject to the individual
dollar limit described in Section 21.2 hereof;
(b) Salary deferral contributions plus, to the extent elected by the
Company, any qualified nonelective contributions shall be subject
to the deferral percentage limit set forth in Section 21.3 hereof;
(c) Matching contributions, other than qualified nonelective
contributions used in the deferral percentage test set forth in
Section 21.3 hereof, and after-tax contributions, if any, made to
this Trust and Plan pursuant to a Supplemental Agreement shall be
subject to the contribution percentage limit set forth in Section
21.4 hereof;
(d) The contributions described in subparagraphs (b) and (c) above
shall be subject to the limit on "multiple use" set forth in
Section 21.5 hereof;
(e) All contributions made pursuant to Articles V and VI hereof and
any other employer contributions made pursuant to the Supplemental
Agreements shall, in the aggregate, be subject to the
deductibility limit set forth in Section 21.6 hereof; and
(f) The allocation of all of the foregoing contributions, in the
aggregate, shall be subject to the limitation on annual additions
set forth in Article XXII hereof.
In addition, the following rules and procedures shall apply for purposes
of this Article:
(i) For purposes of determining a participant's deferral or
contribution percentage pursuant to Section 21.8(b) or
21.8(c) hereof, all salary deferral contributions that are
made under two (2) or more plans (or after-tax and matching
contributions, as appropriate) that are aggregated for
purposes of Sections 401(a)(4) or 410(b) of the Code (other
than Section 410(b)(2)(A)(ii) of the Code) shall be treated
as made under a single plan.
21-1
<PAGE> 86
(ii) If two (2) or more plans are permissively aggregated for
purposes of Section 401(k) or 401(m) of the Code, the
aggregated plans shall also satisfy Sections 401(a)(4) and
410(b) of the Code as though they were a single plan.
(iii) The deferral or contribution percentage of any highly
compensated employee shall be determined by treating all
plans maintained by the Company and any affiliates that are
subject to Section 401(k) or 401(m) of the Code (other than
those that may not be permissively aggregated) as a single
plan.
21.2 The salary deferral contributions with respect to the taxable year
of a participant plus similar amounts contributed on a similar basis by any
other employer (whether or not related to the Company) required by law to be
aggregated with his salary deferral contributions under this Trust and Plan
shall not exceed Ten Thousand Dollars ($10,000.00), plus any adjustment for
cost-of-living after 1998 as determined pursuant to regulations issued by the
Secretary of the Treasury or his delegate pursuant to Section 415(d) of the
Code.
In the event that the salary deferral contributions for a participant's
taxable year exceed such limit, or in the event that the Administrator shall
receive notice from a participant by the March 1 next following the close of a
participant's taxable year that his salary deferral contributions, together with
similar contributions under plans of other employers shall have exceeded such
limit, the Administrator shall cause the amount of excess contributions,
together with any earnings allocable to such excess contributions, to be
refunded to the participant by the following April 15th. Any such refund of
excess contributions shall be debited from the participant's salary deferral
account.
21.3 Salary deferral contributions made on behalf of a participant for a
plan year (hereinafter sometimes referred to as the "current plan year") shall
be limited so that the average deferral percentage for the highly compensated
employees who are participants or who are eligible to become participants for
such plan year shall not exceed an amount determined
21-2
<PAGE> 87
based upon the average deferral percentage for the employees who are
participants or who are eligible to become participants but are not highly
compensated employees for the preceding plan year or, if the Company elects, for
the current plan year, as follows:
(A) (B)
Average Deferral Limit on Average Deferral
Percentage for Employees Percentage for Employees
Eligible to Participate Eligible to Participate
who are not Highly who are Highly
Compensated Compensated
--------------------------- -----------------------------
Less than 2% 2 times Column (A)
2% or more but less than 8% Column (A) plus 2%
8% or more 1.25 times Column (A)
In the event the Company elects to determine the average deferral percentages of
employees who are not highly compensated employees on the basis of the current
plan year rather than the preceding plan year in accordance with Section
401(k)(3)(A) of the Code, such election by the Company may not be changed for
plan years commencing after December 31, 1998, except as provided by the
Secretary of the Treasury.
If, for any plan year, this Trust and Plan satisfies the requirements of
Section 21.4 hereof, then the Company may elect, in such manner as the Secretary
of the Treasury or his delegate may provide, to take into account, as additional
amounts for purposes of this Section, all or a part of the fully vested matching
contributions, if any, made for the plan year.
21.4 The contributions made for a plan year (hereinafter sometimes
referred to as "current plan year") as matching contributions and/or as
after-tax contributions shall be limited so that the average contribution
percentage for the highly compensated employees who are participants or who are
eligible to become participants for such plan year shall not exceed an amount
determined based upon the average contribution percentage for the employees who
are participants or who are eligible to become participants but are not highly
compensated
21-3
<PAGE> 88
employees for the preceding plan year or, if the Company elects, for the current
plan year, in accordance with the table set forth in Section 21.3 hereof.
In the event the Company elects to determine the average contribution
percentages of employees who are not highly compensated employees on the basis
of the current plan year rather than the preceding plan year in accordance with
Section 401(m)(2)(A) of the Code, such election by the Company may not be
changed for plan years commencing after December 31, 1998, except as provided by
the Secretary of the Treasury.
If, for any plan year, this Trust and Plan satisfies the requirements of
Section 21.3 hereof, then the Company may elect, in such manner as the Secretary
of the Treasury or his delegate may provide, to take into account, as additional
amounts for purposes of this Section, all or a part of the salary deferral
contributions made to this Trust and Plan.
21.5 If the sum of the deferral percentage and the contribution
percentage for one or more highly compensated employees exceeds the aggregate
limit defined in Section 21.8(a) hereof, the contribution percentage for such
employee or employees shall be reduced in accordance with Section 21.7 hereof so
that the aggregate limit is not exceeded. The amount by which a highly
compensated employee's contribution percentage is reduced shall be treated as an
excess contribution pursuant to Section 21.7. The deferral percentage and
contribution percentage of the highly compensated employees shall be determined
after any corrections are made to meet the deferral percentage and contribution
percentage limits. Multiple use does not occur if neither the average deferral
percentage nor the average contribution percentage of the highly compensated
employees exceeds one and twenty-five hundredths (1.25) multiplied by the
corresponding average deferral percentage or average contribution percentage of
the non-highly compensated employees.
21-4
<PAGE> 89
21.6 In no event shall the total of all contributions made pursuant to
Articles V and VI hereof and any other employer contributions made pursuant to
the Supplemental Agreements exceed the maximum amount allowable as a deduction
under Section 404(a)(3) of the Code or any statute of similar import, including
the amount of any contribution carryforward allowable under said Section
404(a)(3). This limitation shall not apply to contributions which may be
required in order to provide the minimum contributions described in Article XXIV
hereof for any plan year in which this Trust and Plan is top-heavy. Nor shall
this limitation apply to contributions which may be required in order to
recredit the account of any rehired participant whose account is to be
recredited with prior forfeitures as described in Section 12.5 hereof.
21.7 In the event that the limitations set forth in Section 21.2, 21.3,
21.4 or 21.5 hereof shall be exceeded, the Administrator shall take action to
reduce future salary deferral contributions made pursuant to Article V hereof,
future matching contributions made pursuant to Article VI hereof and any
after-tax contributions made pursuant to a Supplemental Agreement as
appropriate. Such action may include a reduction in the future rate of salary
deferral contributions or after-tax contributions of any highly compensated
participant pursuant to any legally permissible procedure. In the event that
such action shall fail to prevent the excess, prior salary deferral
contributions made pursuant to Article V hereof or prior after-tax contributions
made pursuant to a Supplemental Agreement, plus any income and minus any losses
allocable thereto to the date of distribution, shall be distributed to the
participant on whose behalf such contributions were made or, in the case of
salary deferral contributions, shall be recharacterized as after-tax
contributions if such recharacterization does not cause the limitations of
Section 21.3 hereof to be exceeded with respect to such participant and such
participant is permitted to make
21-5
<PAGE> 90
after-tax contributions to this Trust and Plan pursuant to a Supplemental
Agreement. In the event salary deferral contributions are recharacterized,
excess contributions shall be determined after first determining the excess
contributions which are recharacterized. In the event that any salary deferral
contributions made pursuant to Article V hereof or any after-tax contributions
made pursuant to any Supplemental Agreement are distributed to a participant,
any related matching contributions, plus any income and minus any losses
allocable thereto to the date of distribution, shall be:
(a) forfeited and disposed of if such matching contributions are not
vested; and
(b) distributed to the participant if such matching contributions are
vested.
In the event of such a distribution, recharacterization or forfeiture,
the salary deferral account, and if applicable the employer contribution account
or any account credited with after-tax contributions, of such participant shall
be debited, or in the case of recharacterization, debited or credited as
appropriate with the amount of such distribution, recharacterization or
forfeiture. Any such adjustments made in participants' accounts shall be made in
a uniform manner for similarly situated participants. In addition, any salary
deferral contributions which are recharacterized will remain subject to the same
distribution restrictions which apply to salary deferral contributions.
In the event that distributions must be made in order to bring this Trust
and Plan into compliance with Section 21.3, 21.4 or 21.5 hereof, the
Administrator shall reduce the dollar amount of deferrals and/or contributions
of highly compensated employees in descending order, beginning with the highly
compensated employee(s) with the highest total deferral amount or highest total
contribution amount, until such limitations have been satisfied. In performing
such reduction, the reduced deferral amount or reduced contribution amount of
any affected highly
21-6
<PAGE> 91
compensated employee shall, in no event, be lower than that of the highly
compensated employee with the next highest deferral amount or next highest
contribution amount.
Any excess salary deferral contributions to be distributed to a
participant or recharacterized pursuant to this Section shall be reduced by any
excess salary deferral contributions previously distributed to such participant
for such participant's taxable year ending with or within the plan year in
accordance with Code Section 402(g)(2).
Any excess contributions for a plan year, together with any income
allocable to such excess contributions, which are distributable as described
above shall be distributed to a participant within one (1) year after the end of
such plan year. If such excess amounts are not distributed within two and
one-half (2-1/2) months of the end of the plan year, a ten percent (10%) excise
tax on such excess amounts shall be imposed on the Company. Excess contributions
shall be treated as annual additions under Article XXII hereof.
21.8 For purposes of this Trust and Plan, the following definitions and
special rules shall apply:
(a) "aggregate limit" shall mean the greater of (i) or (ii), where:
(i) equals the sum of:
(A) one and twenty-five hundredths (1.25) times the
greater of the deferral percentage or the
contribution percentage for the non-highly
compensated employees; and
(B) two (2) percentage points plus the lesser of the
deferral percentage or the contribution percentage
for the non-highly compensated employees; and
(ii) equals the sum of:
(A) one and twenty-five hundredths (1.25) times the
lesser of the deferral percentage or the
contribution percentage for the non-highly
compensated employees; and
21-7
<PAGE> 92
(B) two (2) percentage points plus the greater of the deferral
percentage or the contribution percentage for the
non-highly compensated employees.
In no event, however, shall the amounts set forth in subparagraphs
(i)(B) and (ii)(B) above exceed twice the greater of the deferral
percentage or the contribution percentage for the non-highly
compensated employees.
(b) "contribution percentage" shall mean for a participant for any
plan year a fraction:
(i) the numerator of which shall equal the total of (A) plus
(B), where:
(A) equals matching contributions made on his behalf;
and
(B) his after-tax contributions; and
(ii) the denominator of which shall equal his Total Remuneration
for such plan year;
provided, however, that the Company may elect to take into account
additional contributions pursuant to Section 21.4 hereof. In
addition, "contribution percentage" shall mean zero percent (0%)
for an employee who is eligible to become a participant but who is
not a participant. In addition, after-tax contributions will be
taken into account if they are paid to this Trust and Plan or
transmitted to this Trust and Plan within a reasonable period
after the end of such plan year and matching contributions shall
be considered to be made on a participant's behalf for a plan year
if such matching contributions are made as a result of the
participant's salary deferral contributions or after-tax
contributions, are allocated to the participant's employer
contribution account during such plan year and are paid to this
Trust and Plan no later than twelve (12) months after the end of
such plan year.
(c) "deferral percentage" shall mean for a participant for any plan
year a fraction:
(i) the numerator of which shall equal the total of the salary
deferral contributions made on his behalf for such plan
year; and
(ii) the denominator of which shall equal his Total Remuneration
for such plan year;
provided, however, that the Company may elect to take into account
additional contributions pursuant to Section 21.3 hereof. In
addition, "deferral percentage" shall mean zero percent (0%) for
an employee who is eligible to become a participant but who is not
a participant. In
21-8
<PAGE> 93
addition, salary deferral contributions shall be considered to be
made on a participant's behalf for a plan year if such salary
deferral contributions are not contingent on participation or
performance of services after the end of such plan year, such
salary deferral contributions would have been received (but for
the deferral election) within two and one-half (2-1/2) months
after the end of such plan year and are paid to this Trust and
Plan no later than twelve (12) months after the end of such plan
year.
(d) "highly compensated employee" shall mean an employee who is a
"highly compensated employee" for a plan year as described in
Section 414(q) of the Code which is hereby incorporated by
reference and who is described for informational purposes herein
as an employee during a plan year if either:
(i) during the preceding plan year, he:
(A) was at any time a five percent (5%) actual or
constructive owner of the Company and its
affiliates;
(B) received Total Remuneration from the Company and its
affiliates greater than Eighty Thousand Dollars
($80,000.00) (plus any increase for cost of living
after 1998 as determined by the Secretary of the
Treasury or his delegate) and, if the Company so
elects, was in the "top paid group" of employees of
the Company and its affiliates for such plan year;
or
(ii) during the current plan year, he was at any time a five
percent (5%) or more actual or constructive owner of the
Company and its affiliates.
(e) "top paid group" shall mean a group consisting of the top paid
twenty percent (20%) of the employees of the Company and all
affiliates ranked on the basis of Total Remuneration from the
Company and all affiliates paid during the plan year. In
determining the members of the top paid group, the following
employees shall be excluded:
(i) employees who have not completed six (6) months service;
(ii) employees who normally work less than seventeen and
one-half (17-1/2) hours per week;
(iii) employees who normally work during not more than six (6)
months during any year;
(iv) employees who have not attained age twenty-one (21);
21-9
<PAGE> 94
(v) except to the extent provided in regulations, employees who
are included in a unit of employees covered by an agreement
which the Secretary of Labor finds to be a collective
bargaining agreement between employee representatives and
the Company or any affiliate; and
(vi) employees who are nonresident aliens and who receive no
earned income (within the meaning of Section 911(d)(2) of
the Code) from a the Company or any affiliate which
constitutes income from sources within the United States
(within the meaning of Section 861(a)(3) of the Code).
The Company may elect (in such manner as may be provided by the
Secretary of the Treasury or his delegate) to apply subparagraph
(i), (ii), (iii), or (iv) by substituting a shorter period of
service, smaller number of hours or months, or lower age for the
period of service, number of hours or months, or age (as the case
may be) than that specified in such subparagraph.
(f) "Total Remuneration" shall mean compensation as defined in Section
2.10 hereof but including a participant's compensation during
periods in which he is not an active participant.
21-10
<PAGE> 95
ARTICLE XXII
------------
LIMITATION ON ANNUAL ADDITIONS
------------------------------
22.1 Notwithstanding anything contained in this Trust and Plan to the
contrary, in no event shall a participant's annual additions and annual amount
of retirement benefits be greater than the maximum allowable amounts determined
in accordance with Section 415 of the Code, taking into account for periods
prior to January 1, 2000 paragraph (e) of said Section 415, Section 1106 of the
Tax Reform Act of 1986, Section 235(g) of the Tax Equity and Fiscal
Responsibility Act of 1982 and Section 2004(d) of ERISA which are, respectively,
incorporated herein by reference.
22.2 In the event a participant, who would otherwise be credited with
excess annual additions, benefits or projected benefits is also a participant
under the Company's Retirement Income Plan II, prior to January 1, 2000
adjustment under Section 415 of the Code shall be made in the following order:
(a) first, projected benefits under the Company's Retirement Income
Plan II shall be reduced;
(b) second, accrued benefits under the Company's Retirement Income
Plan II including employee contributions, if any, shall be
reduced; and
(c) third, annual additions which consist of salary deferral
contributions, matching contributions and employer contributions
hereunder shall be reduced.
Notwithstanding the foregoing, in the event a participant's excess annual
benefits or projected benefits would only result in a violation under Section
415(b) of the Code, his benefits under the Company's Retirement Income Plan II
shall be reduced in the order set forth in subparagraphs (a) and (b) above.
Furthermore, in the event a participant's excess annual additions would only
result in a violation under Section 415(c) of the Code, his annual additions
shall be reduced
22-1
<PAGE> 96
under the Company's defined contribution plans, including this Trust and Plan,
as set forth in subparagraph (c) above and thereafter under the Company's
Retirement Income Plan II as set forth in subparagraph (b) above if further
reduction is needed after the reduction in subparagraph (c).
22.3 For purposes of calculating the maximum allowable amounts under
Section 22.1 hereof, a participant's "limitation year" shall mean the calendar
year and his "compensation" shall mean all amounts paid to him in payment for
services rendered by him to the Company or any affiliate which may be taken into
account for purposes of determining limitations on annual additions and benefits
under Section 415 of the Code and any lawful regulations thereunder and
includible in gross income during the limitation year.
22.4 In the event that, after the application of any other provisions of
this Trust and Plan and any provisions of the retirement plans described in
Section 22.2 hereof, there still remain, as a result of a reasonable error in
estimating a participant's compensation or other limited facts and circumstances
which the Commissioner of Internal Revenue finds justify the availability of the
rules set forth in this Section, Company contributions which, if allocated to a
participant, would be in excess of the limits on annual additions set forth in
Section 22.1 hereof, such excess shall be used as of the next allocation date
and any succeeding allocation date, as necessary, to reduce the Company
contributions which would otherwise be made for such participant for the taxable
years ending on such dates. In the event such participant is not an active
participant on the next allocation date, or on any succeeding allocation date on
which such excess still remains, such excess shall be used as of such allocation
date and on any succeeding allocation date to reduce the Company contributions
for all participants who are active participants. In the event that salary
deferral contributions made by a terminated participant are
22-2
<PAGE> 97
used for the benefit of other participants after the participant terminates
employment, the Company shall make a direct payment to the terminated
participant on whose behalf such salary deferral contributions were made equal
to the total of such amounts.
Until any excess described above is used to reduce Company contributions,
it shall be held in a suspense account. Such suspense account shall not be
subject to the valuation procedure described in Section 7.4 hereof.
Notwithstanding any other provisions of this Trust and Plan to the contrary (and
specifically Section 26.4 hereof), in the event this Trust and Plan is
terminated at a time when there are amounts credited to a suspense account
pursuant to this Section, such excess shall be returned to the Company. In the
event that amounts representing salary deferral contributions are returned to
the Company hereunder, the Company shall make payments to the participants on
whose behalf such salary deferral contributions were made equal to the total of
such refunded amounts.
22-3
<PAGE> 98
ARTICLE XXIII
-------------
ROLLOVERS AND TRANSFERS INVOLVING
---------------------------------
OTHER QUALIFIED RETIREMENT PLANS
--------------------------------
23.1 In the event that:
(a) any active participant shall have been, either prior to becoming
an employee or while an employee, a participant under another
qualified retirement plan which met the requirements of Section
401(a) of the Code, including this Trust and Plan; and
(b) either:
(i) the custodian or trustee of the assets held pursuant to
said plan on behalf of said participant; or
(ii) the custodian or trustee of the assets of an individual
retirement account established pursuant to Section 408 of
the Code to hold the assets distributed to said participant
from said plan; or
(iii) the said participant who holds assets distributed to him
during the preceding sixty (60) days from such plan or from
an individual retirement account described in paragraph (i)
above shall agree to transfer said assets to the Trustee
hereunder; and
(c) the assets to be so transferred shall not be made available to
said employee in the course of the transfer except to the extent
permitted by paragraph (b)(iii) above; and
(d) the Administrator consents to the transfer;
the Trustee hereunder shall accept such transferred assets and hold and
administer them pursuant to the terms and provisions of this Trust and Plan and
this Article. Notwithstanding the foregoing, in no event shall any assets be
transferred from another qualified retirement plan to this Trust and Plan if the
transfer of such assets would require that the provisions of this Trust and Plan
governing distributions be amended to comply with the provisions of
Section 401(a)(11) of the Code.
23-1
<PAGE> 99
23.2 Upon the receipt of assets from a qualified defined benefit
retirement plan or a qualified defined contribution retirement plan which is not
maintained by the Company, the Trustee shall credit such amounts to the
non-forfeitable account of the participant on whose behalf the assets were so
transferred. Upon the receipt of assets from a qualified defined contribution
plan which is maintained by the Company, the Trustee shall credit such assets to
the appropriate accounts of the participant on whose behalf the assets were so
transferred. The Administrator shall establish such accounts as are necessary in
order to accomplish the foregoing on behalf of such a participant, including, in
the case of a qualified defined contribution plan which is maintained by the
Company, the establishment of an employer contribution account to receive any
assets credited to an employer contribution account which are partially vested
and subject to the vesting schedule identical to the one set forth in Section
2.52 hereof.
23.3 In the event that:
(a) any participant hereunder shall either:
(i) terminate his employment and subsequently become a
participant under the qualified retirement plan of another
employer, which plan satisfies the requirements of Section
401 of the Code; or
(ii) cease to be an active participant in this Trust and Plan
and subsequently become an active participant in another
qualified defined contribution retirement plan of the
Company, which plan satisfies the requirements of Section
401 of the Code;
(b) said participant or former participant shall have account balances
hereunder which have not have been distributed to him and, if he
is a former participant, shall have a vested percentage of one
hundred percent (100%);
(c) the participant or former participant shall apply to the
Administrator hereunder for transfer to such other plan of assets
held pursuant to this Trust and Plan representing said
participant's or former participant's account balances;
23-2
<PAGE> 100
(d) the assets to be transferred shall not be made available to said
participant or former participant in the course of the transfer
except to the extent permitted by Section 402(a)(5) of the Code;
and
(e) the Administrator shall consent to such transfer;
the following shall be transferred to the trustee or custodian of such other
qualified retirement plan:
(i) if he is a participant, his total account balances; or
(ii) if he is a former participant, an amount equal to his vested
interest.
23-3
<PAGE> 101
ARTICLE XXIV
------------
TOP-HEAVY PROVISIONS
--------------------
24.1 During any plan year that this Trust and Plan is top-heavy, as
determined in accordance with Section 24.2 hereof, the special restrictions
contained in Sections 24.3 and 24.4 hereof shall apply.
24.2 This Trust and Plan shall be considered to be top-heavy in any plan
year if, as of the determination date for such plan year, all the aggregation
groups of which this Trust and Plan is a member are top-heavy groups. In the
event that in any plan year this Trust and Plan is a member of an aggregation
group which is not a top-heavy group, this Trust and Plan shall not be
considered to be top-heavy for such plan year.
For purposes of determining the foregoing, the following terms shall be
defined as follows:
(a) "determination date" shall mean for the first plan year, its last
day, and shall mean, for any other plan year, the last day of the
preceding plan year;
(b) "key employee" shall mean a "key employee" as described in Section
416(i) of the Code which is hereby incorporated by reference and
who is described for informational purposes herein as any
employee, former employee or beneficiary who at any time during
the plan year or the four (4) preceding plan years is:
(i) an officer of the Company or an affiliate having total
remuneration (as defined in Section 24.2(g) hereof) for the
plan year of determination greater than fifty percent (50%)
of the amount specified in Section 415(b)(1)(A) of the Code
(plus any increase for cost-of-living after 1998 as
determined from time to time pursuant to regulations issued
by the Secretary of the Treasury or his delegate pursuant
to Section 415(d) of the Code);
(ii) a one-half of one percent (.5%) actual or constructive
owner of the Company or any affiliate who owns one of the
ten (10) largest interests in the Company or any affiliate
and who is an employee of the Company or an affiliate
having total remuneration (as defined in Section 24.2(g)
hereof) greater than Thirty Thousand
24-1
<PAGE> 102
Dollars ($30,000.00) or, if greater, the amount specified
in Section 415(c)(1)(A) of the Code (plus any increase for
cost-of-living after 1998 as determined from time to time
pursuant to regulations issued by the Secretary of the
Treasury or his delegate pursuant to Section 415(d) of the
Code);
(iii) a five percent (5%) actual or constructive owner of the
Company or any affiliate; or
(iv) a one percent (1%) actual or constructive owner of the
Company or any affiliate having total remuneration (as
defined in Section 24.2(g) hereof) from the Company and all
affiliates for the plan year of determination greater than
One Hundred Fifty Thousand Dollars ($150,000.00);
provided that any such employee also performed service for the
Company or an affiliate during the five (5) plan year period
ending on the determination date; and provided that an amount held
for the beneficiary of a key employee who is deceased shall be
deemed to be an amount held for a key employee;
(c) "non-key employee" shall mean any employee, former employee or
beneficiary who is not a key employee including any employee or
beneficiary who was formerly a key employee;
(d) "permissive aggregation group" shall mean the required aggregation
group plus one (1) or more other plans to which the Company or any
affiliate makes contributions which, when considered as a group
with the required aggregation group, would continue to comply with
Sections 401(a)(4) and 410 of the Code;
(e) "required aggregation group" shall mean each defined benefit plan
and each defined contribution plan of the Company or any affiliate
in which a key employee is a participant in the plan year
containing the determination date or in any of the four (4)
preceding plan years and each other defined benefit plan and each
other defined contribution plan which, during said plan years,
enables such plans to meet the requirements of Section 401(a)(4)
or 410 of the Code, including for this purpose each defined
benefit plan and each defined contribution plan of the Company or
any affiliate which was terminated during any of said plan years;
(f) "top-heavy group" shall mean any aggregation group if the sum, as
of the determination date, of:
(i) the aggregate value of the account balances of key
employees under all defined contribution plans included in
such group; and
24-2
<PAGE> 103
(ii) the present value of the cumulative accrued benefits for
key employees under all defined benefit plans included in
such group;
exceeds sixty percent (60%) of a similar sum determined for all
participants, former participants and beneficiaries permitted to
be taken into account pursuant to Section 416(g) of the Code, with
such values being determined for each plan as of the most recent
valuation date occurring within the twelve (12) month period
ending on the determination date and subject to appropriate
adjustments under said Section 416(g) and lawful regulations
issued thereunder, including the requirement that benefits and
accounts of a participant be increased by the aggregate
distributions with respect to such participant during the five (5)
year period ending on the determination date;
(g) "total remuneration" shall mean, for any participant, all amounts
paid to him in payment for services rendered by him to the Company
or any affiliate which may be taken into account for purposes of
determining limitations on annual additions and benefits under
Section 415 of the Code and any lawful regulations thereunder;
provided that total remuneration shall not exceed One Hundred
Sixty Thousand Dollars ($160,000.00) (plus any adjustment after
1998 for cost-of-living or otherwise as shall be prescribed by the
Secretary of the Treasury pursuant to Sections 401(a)(17) and
415(d) of the Code); and
(h) "valuation date" shall mean:
(i) in the case of a defined contribution plan, a date as of
which account balances are valued; and
(ii) in the case of a defined benefit plan, a date as of which
liabilities and assets are valued for computing plan costs
for purposes of determining the plan's minimum funding
requirements under Section 412 of the Code.
In making any of the aforementioned calculations, contributions due but
unpaid as of the determination date shall be included in determining the value
of account balances. In addition, the present value of cumulative accrued
benefits shall be determined as if they accrued no more rapidly than the slowest
rate of accrual permitted under the fractional rule of Section 411(b)(1)(C) of
the Code utilizing the actuarial factors and assumptions set forth in the
defined benefit plans included in the aggregation groups. Furthermore, for
purposes of making the aforementioned calculations with respect to defined
benefit plans, proportional subsidies and
24-3
<PAGE> 104
benefits not relating to retirement benefits, such as pre-retirement death and
disability benefits and post retirement medical benefits, are to be disregarded
but nonproportional subsidies are to be taken into account.
24.3 During any plan year that this Trust and Plan is top-heavy, the
Company or a Participating Division shall make a minimum contribution to this
Trust and Plan on behalf of each non-key employee who meets all of the following
requirements:
(a) he is not covered by a collective bargaining agreement;
(b) he is a participant on the last day of such plan year or was a
participant whose employment terminated on or as of said date,
irrespective of whether he has completed one thousand (1,000)
hours for the Company or an affiliate during such plan year; and
(c) he is not a participant in a defined benefit pension plan that
provides him with a minimum accrued benefit (regardless of whether
such accrued benefit is offset by benefits under this Trust and
Plan) which satisfies the requirements of Section 416(c)(1) of the
Code.
The minimum contribution to be made hereunder for such a non-key employee shall
be an amount which when added to the contributions allocable to such non-key
employee under all other defined contribution plans of the Company or any
affiliate shall cause such total contributions to be at least equal to the
lesser of:
(i) three percent (3%) of the non-key employee's total
remuneration (as defined in Section 24.2(g) hereof) during
the plan year; or
(ii) the largest percentage of total remuneration provided to
any key employee by the contributions of the Company or any
affiliate for such plan year.
In determining the percentage set forth in subparagraph (ii) above, salary
reduction amounts which are excluded from the taxable income of a key employee
under Code Section 402(e)(3) shall be taken into account, but such amounts,
together with any related matching contributions, shall not be taken into
account with respect to non-key employees in determining compliance
24-4
<PAGE> 105
with this Section. Any employer contributions made pursuant to this Section
shall be credited to a participant's employer contribution account and shall be
subject to the vesting schedule set forth in Section 2.52 hereof. However,
employer contributions made pursuant to Section 12.5 hereof shall not be taken
into account when determining the employer contributions required under this
Section.
24.4 During any plan year ending prior to January 1, 2000 that this Trust
and Plan is top-heavy the limitations on annual additions and annual benefits
under Section 415 of the Code, described in Section 22.1 hereof, shall be
reduced as described in Section 416(h) of the Code. The Company and the
Participating Divisions will not make the additional contributions permitted by
Section 416(h)(2) of the Code to increase the limits under Section 415(e) of the
Code.
24-5
<PAGE> 106
ARTICLE XXV
-----------
SPECIAL PROVISIONS WITH RESPECT TO CERTAIN SHARES
-------------------------------------------------
25.1 Unless the context otherwise indicates, the following terms used
herein shall have the following meanings whenever used in this Article:
(a) The words "Debt Financed Shares" shall mean any Shares acquired
with the proceeds of a loan made to the ESOP by a disqualified
person as defined in Code Section 4975(e)(2) or a loan made to the
ESOP which was guaranteed by such a disqualified person ("ESOP
loan") or with the proceeds of a prior ESOP loan which was repaid
with the proceeds of the ESOP loan, and shall mean any Shares
acquired under an installment purchase obligation which
constitutes an ESOP loan. Said Debt Financed Shares shall be
further denominated as either "Debt Financed Class A Shares" or
"Debt Financed Class B Shares".
(b) The words "4980 Shares" shall mean any Shares acquired by the
Salaried ESOP prior to its merger into the ESOP directly or
indirectly as a result of the transfer of amounts from the
Company's terminated Retirement Income Plan. Said 4980 Shares are
credited to Salaried ESOP accounts.
(c) The words "publicly traded" shall mean with respect to any Shares
that such Shares are listed on a national securities exchange
registered under Section 6 of the Securities Exchange Act of 1934
or that such Shares are quoted on a system sponsored by a national
securities association registered under Section 15(A)(b) of the
Securities Exchange Act of 1934.
(d) The words "trading limitation" shall mean any restriction with
respect to any Shares under any federal or state securities law,
any regulation thereunder or an agreement affecting such Shares
which would make them not as freely tradeable as Shares not
subject to such restriction.
25.2 Qualified Persons may diversify the investment of their Stock Plan
accounts by directing the investment of their Stock Plan accounts in accordance
with Article VII hereof.
25.3 Until such time as all Debt Financed Shares have been distributed
from an ESOP account, the Trustee shall maintain subaccounts as a part of each
ESOP account. Such
25-1
<PAGE> 107
subaccounts shall show the number of Debt Financed Shares and other Shares
credited to such subaccounts.
25.4 In the event that Shares which are credited to a Stock Plan account
are distributed to a participant, former participant or beneficiary and such
Shares are not publicly traded or are subject to a trading limitation, the
Company shall grant to certain holders of such Shares an option to require the
Company to purchase and redeem such Shares. Such option shall be granted to such
participant, former participant or beneficiary or to any one of such
participant, former participant or beneficiary or to any person (including an
estate or its distributee) to whom the Shares pass by reason of such
participant's, former participant's or beneficiary's death. Such option shall be
exercisable by notice in writing given to the Company prior to the later of:
(a) fifteen (15) months after the date on which the distribution of
such Shares is made by this Trust and Plan; and
(b) sixty (60) days after the holder of such Shares is notified of the
fair market value of such Shares computed as of the first day of
the first plan year commencing more than sixty (60) days after the
date of distribution of such Shares.
Such period of exercise shall be extended by a period of time equal to
the amount of time during which any distributee of this Trust and Plan is unable
to exercise the put option provided for herein due to the fact that the Company
is prohibited from honoring such put option obligation by applicable Delaware
law. If necessary, the Company shall be required to amend its Certificate of
Incorporation to reduce its stated capital or to make any other changes
necessary to enable distributees to exercise the put option provided for under
this Section. In the event that Shares which are credited to a Stock Plan
account are publicly traded without restriction when distributed but cease to be
so traded within the period of exercise described above, the Company shall
notify in writing, on or before the tenth (l0th) day after the date the Shares
cease to be publicly traded, any stockholder or stockholders who would have been
entitled to exercise the
25-2
<PAGE> 108
foregoing put option had the Shares not been publicly traded when distributed
and shall grant to such stockholder or stockholders a put option in accordance
with this Section for the remainder of the period of exercise described above.
Such notice shall inform such stockholder or stockholders of the terms of the
put option extended to them and, if actually given later than the tenth (10th)
day after the date on which the Shares ceased to be publicly traded, such notice
shall provide that the put option shall be extended beyond the period of
exercise by the number of days between such tenth (10th) day and the date on
which notice is actually given. If the foregoing option is not exercised within
the exercise period and any extensions thereof, it shall lapse.
25.5 The price at which Shares shall be purchased by the Company pursuant
to Section 25.4 hereof shall be equal to their fair market value determined in
accordance with Section 16.6 hereof. In the case of a transaction between this
Trust and Plan and a disqualified person (as defined in Section 4975 of the
Internal Revenue Code), such price must be determined as of the date of the
transaction. For all other purposes under this Trust and Plan, the fair market
value of Shares which are credited to a Stock Plan account may be determined as
of the immediately preceding valuation date under this Trust and Plan.
25.6 In the event any put option provided for pursuant to Section 25.4
hereof is exercised by a participant, former participant or beneficiary who has
received a single distribution of Shares pursuant to Section 15.2 or 15.3
hereof, payment by the Company pursuant to the exercise of such option shall be
made in substantially equal annual installments over a period of time beginning
no later than thirty (30) days after the option is exercised and ending no later
than five (5) years thereafter. The balance outstanding at any time with respect
to payment by the Company pursuant to the exercise of such option shall be
adequately secured and bear
25-3
<PAGE> 109
interest at the prime rate determined as of the first day of each quarter of the
plan year but, in any event, not in excess of the maximum rate permitted by law.
Notwithstanding the foregoing, the Company may, in its discretion, elect to make
such payment in a single lump sum payment within thirty (30) days after the date
on which the option is exercised.
25.7 The Company's obligation to pay, in all or in part, the price for
any Shares as to which a put option is exercised pursuant to this Article shall
be conditioned upon:
(a) receipt by the Company of appropriate share certificates duly
endorsed by the person exercising the put option; and
(b) receipt of appropriate assurances that the Shares tendered for
purchase pursuant to the put option are free and clear of any
liens, encumbrances or adverse claims or that such liens,
encumbrances or adverse claims will be paid and satisfied
forthwith as a part of such purchase transaction.
25.8 Notwithstanding the provisions of Section 20.1 hereof to the
contrary, the provisions of this Article with respect to the granting and
exercise of put options shall not be amended or terminated in any way which
would lessen the rights of a stockholder holding Shares to which the put option
relates or would relate. In addition, until distributed from this Trust and
Plan, Shares subject to a put pursuant to this Article shall not be subject to a
put, call, or other option, or buy-sell or similar arrangement other than the
put option described in Section 25.4 hereof.
25.9 The Trustee is expressly forbidden from selling or exchanging any
4980 Shares except as follows:
(a) the Trustee may sell 4980 Shares as needed for the purpose of
making distributions of cash in lieu of Shares or fractional
Shares pursuant to Section 15.2 or 15.3 hereof or paying Trustee
fees;
(b) the Trustee may sell or exchange 4980 Shares in response to a
tender or exchange offer for Shares pursuant to Section 17.4
hereof; or
25-4
<PAGE> 110
(c) the Trustee may sell or exchange 4980 Shares to carry out
directions of Qualified Persons with respect to the
diversification of the investments of their accounts pursuant to
Sections 7.3 and 25.2 hereof.
Notwithstanding anything contained in this Trust and Plan to the contrary, any
sale or exchange of 4980 Shares shall be subject to Code Section 4980 which
requires that 4980 Shares must remain in this Trust and Plan, as the successor
by merger to the ESOP, until either distribution to participants in accordance
with the provisions of this Trust and Plan or diversification of investment by
Qualified Persons in accordance with Sections 7.3 and 25.2 hereof.
25-5
<PAGE> 111
ARTICLE XXVI
------------
MISCELLANEOUS
-------------
26.1 In the event the Company shall at any time be judicially declared
bankrupt or insolvent, or in the event of its dissolution, merger or
consolidation without any provisions being made for the continuation of this
Trust and Plan, the Trust and Plan created hereunder shall terminate and the
Trustee shall make distributions as provided in Section 20.2 hereof.
26.2 In the event this Trust and Plan shall merge or consolidate with, or
transfer any of its assets or liabilities to any other plan, each participant
shall be entitled to receive, if this Trust and Plan were terminated immediately
thereafter, a benefit which is equal to or greater than the benefit he would
have been entitled to receive immediately before the merger, consolidation or
transfer if this Trust and Plan had then terminated, in accordance with Section
414(l) of the Code and Section 208 of ERISA.
26.3 Neither anything contained herein, nor any contribution made
hereunder, nor any other acts done in pursuance of this Trust and Plan, shall be
construed as entitling any participant to be continued in the employ of the
Company or any affiliate for any period of time nor as obliging the Company or
any affiliate to keep any participant in its employ for any period of time, nor
shall any employee of the Company or any affiliate nor anyone else have any
rights whatsoever, legal or equitable, against the Company or any affiliate or
the Trustee as a result of this Trust and Plan except those expressly granted to
him hereunder.
26.4 No contribution or payment by the Company to the Trustee of this
Trust and Plan, nor any income of the Trust Fund, shall in any event revert or
be credited to or be used for the benefit of the Company or any affiliate, and
all such contributions, payments and income shall be used solely and exclusively
for the benefit of the participants and their beneficiaries
26-1
<PAGE> 112
under this Trust and Plan, except that the Trustee shall return to the Company
upon written request of the Company:
(a) any contributions made by the Company by a mistake of fact,
provided such contributions are returned to the Company within one
(1) year after the date such contributions were made;
(b) any contributions made for plan years during which this Trust and
Plan did not initially qualify under Section 401(a) of the Code,
provided such contributions are returned to the Company within one
(1) year after the date of denial of qualification, but only if an
application for determination was made with the Internal Revenue
Service by the time prescribed by law for filing the Company's tax
return for the taxable year in which this Trust and Plan was
adopted, or on such later date as the Secretary of the Treasury
may prescribe; and
(c) any contributions, to the extent that their deduction is
disallowed under Section 404 of the Code, provided that such
disallowed contributions are returned to the Company within one
(1) year after the disallowance of the deduction.
26.5 If any provision of this Trust and Plan shall require the consent of
the spouse of a participant, such consent shall be in writing with the signature
of the spouse notarized or witnessed by the Administrator. Notwithstanding any
provision hereof to the contrary, the consent of the spouse shall not be
necessary if it is established to the satisfaction of the Administrator that the
signature of the spouse cannot be obtained either because the spouse cannot be
located or because of such other circumstances as the Secretary of the Treasury
may prescribe by lawful regulations. Any consent given by a spouse pursuant to
this Section shall be effective only with respect to such spouse and shall not
be effective with respect to any other spouse of such participant.
26.6 Notwithstanding any provision of this Trust and Plan to the
contrary, the Administrator, where required by law or where it deems appropriate
in its sole discretion, may require spousal consent for any actions taken,
elections made, or the exercise of any rights by a
26-2
<PAGE> 113
married participant under this Trust and Plan. Any consent by a spouse pursuant
to this Section shall be made in accordance with Section 26.5 hereof.
26.7 Whenever any pronoun is used herein, it shall be construed to
include the masculine pronoun, the feminine pronoun or the neuter pronoun as
shall be appropriate.
26.8 This Trust and Plan shall be construed under and in accordance with
the laws of the State of Ohio and of the United States of America.
26.9 This Trust and Plan may be modified and amended retroactively, if
necessary, to secure exemption under Section 401(a) of the Code.
26.10 In the event that amounts representing salary deferral
contributions are returned to the Company pursuant to the provisions of Section
26.4 hereof, the Company shall make payments to the participants on whose behalf
such salary deferral contributions were made equal to the total of such refunded
amounts.
26.11 Any distribution made hereunder to a distributee shall be made
directly to such distributee unless he elects a direct rollover pursuant to the
second paragraph of this Section; provided, however, that the distributee must
acknowledge in writing that he understands that any payment which includes more
than two hundred dollars ($200.00) in cash and which, under Code Section 402(c),
is eligible to be rolled over to an eligible retirement plan will be subject to
withholding taxes.
Each distributee shall have the right to direct that any distribution
which, under Code Section 402(c), qualifies as an eligible rollover distribution
be transferred directly to an eligible retirement plan. A distributee may direct
that part of the distribution be transferred directly to an eligible retirement
plan and the balance be paid to him, provided that the amount directly
transferred to the eligible retirement plan shall be at least five hundred
dollars ($500.00).
26-3
<PAGE> 114
A distributee is not permitted to direct that his distribution be transferred
directly to more than one eligible retirement plan. In the event that a
distributee fails to make any direction, the distribution shall be paid directly
to him after deduction of appropriate withholding taxes.
Unless the context otherwise indicates, the following terms
shall have the following meanings whenever used in this Section:
(a) "eligible rollover distribution" shall mean 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:
(i) 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 (10) years or more;
(ii) any distribution to the extent such distribution is
required under Section 15.4 hereof which reflects the
requirements under Section 401(a)(9) of the Code; and
(iii) 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).
(b) "eligible retirement plan" shall mean:
(i) an individual retirement account described in Section
408(a) of the Code;
(ii) an individual retirement annuity described in Section
408(b) of the Code;
(iii) an annuity plan described in Section 403(a) of the Code; or
(iv) a qualified trust described in Section 401(a) of the Code;
that accepts the distributee's eligible rollover distribution.
Notwithstanding the foregoing, in the case of an eligible rollover
distribution to the surviving spouse of a deceased employee, an
eligible retirement plan is an individual retirement account or
individual retirement annuity.
(c) "distributee" shall mean:
26-4
<PAGE> 115
(i) an employee or former employee; and
(ii) an employee's or a former employee's surviving spouse and
an 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 19.1(c) hereof,
without regard to the interest of the spouse or former
spouse.
(d) "direct rollover" shall mean a payment by this Trust and Plan to
the eligible retirement plan specified by the distributee.
26.12 Notwithstanding any provision of this Amendment and Restatement to
the contrary, this Amendment and Restatement shall not affect the total balances
credited to the accounts of any participant as of the restatement date, and
shall not affect the amount or method of distribution of the vested interests of
participants who died, retired or terminated employment prior to the restatement
date.
26.13 Notwithstanding any provision of this Trust and Plan to the
contrary, contributions, benefits and service credit with respect to qualified
military service will be provided in accordance with Section 414(u) of the Code.
In addition, loan repayments will be suspended under Article XI hereof as
permitted under Section 414(u)(4) of the Code.
26-5
<PAGE> 116
IN WITNESS WHEREOF, SCOTT TECHNOLOGIES, INC. by its
appropriate officers duly authorized, and WILMINGTON TRUST COMPANY have caused
this Amendment and Restatement of the Trust and Plan to be executed as of the
5th day of November, 1998.
SCOTT TECHNOLOGIES, INC.
("Company")
By /s/ W. Sickman
----------------------------
And /s/ Glen Lindemann
----------------------------
WILMINGTON TRUST COMPANY
("Trustee")
By /s/ Barbara Uberti
----------------------------
And /s/ Linda M. Bailey
----------------------------
26-6
<PAGE> 1
EXHIBIT 23.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
February 23, 1998 included in the Scott Technologies, Inc. Form 10-K for the
year ended December 31, 1997 and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Cleveland, Ohio
January 8, 1999
<PAGE> 1
EXHIBIT 24.1
SCOTT TECHNOLOGIES, INC.
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that Scott Technologies, Inc. hereby
constitutes and appoints Mark A. Kirk, Debra L. Kackley, William Sickman and
Douglas A. Neary, or any one or more of them, its attorneys-in-fact and agents,
each with full power of substitution and resubstitution for it in any and all
capacities, to sign any or all amendments or post-effective amendments to this
Registration Statement, and to file the same, with exhibits thereto and other
documents in connection therewith, with the Securities and Exchange Commission,
granting unto each of such attorneys-in-fact and agents full power and authority
to do and to perform each and every act and thing requisite and necessary in
connection with such matters and hereby ratifying and confirming all that each
of such attorneys-in-fact and agents or his substitute or substitutes may do or
cause to be done by virtue hereof.
IN WITNESS WHEREOF, this Power of Attorney has been signed at Mayfield
Heights, Ohio on January 8, 1999.
SCOTT TECHNOLOGIES, INC.
By: /s/ Glen W. Lindemann
---------------------------------------
Glen W. Lindemann
President and Chief Executive Officer
<PAGE> 2
EXHIBIT 24.1
(Continued)
SCOTT TECHNOLOGIES, INC.
Certified Resolution
I, DEBRA L. KACKLEY, Secretary of Scott Technologies, Inc., a Delaware
corporation (the "Corporation"), do hereby certify that the following is a true
copy of a resolution adopted by the Board of Directors on September 22, 1998,
and that the same has not been changed and remains in full force and effect.
RESOLVED, that Mark A. Kirk, Debra L. Kackley, William Sickman and
Douglas A. Neary be, and each of them hereby is, appointed as the attorney of
Scott Technologies, Inc., with full power of substitution and resubstitution for
and in the name, place and stead of the Company to sign, attest and file any
amendment(s) to the Hourly Registration Statement (the "Amended Hourly
Registration Statement"), or any other appropriate form that may be used from
time to time, with respect to the issue and sale of its Class A Common Stock,
its Class B Common Stock and interests in the Hourly Plan, and any and all
amendments, post-effective amendments and exhibits to such Amended Hourly
Registration Statement and any and all applications or other documents to be
filed with the Securities and Exchange Commission or any national securities
exchange pertaining to the listing thereon of the Class A Common Stock, the
Class B Common Stock and interests in the Hourly Plan covered by such Amended
Hourly Registration Statement or pertaining to such registration and any and all
applications or other documents to be filed with any governmental or private
agency or official relative to the issuance of said Class A Common Stock, the
Class B Common Stock and interests in the Hourly Plan with full power and
authority to do and perform any and all acts and things whatsoever requisite and
necessary to be done in the premises, hereby ratifying and approving the acts of
such attorneys or any such substitute or substitutes and, without implied
limitation, including in the above the authority to do the foregoing on behalf
and in the name of any duly authorized officer of the Company; and the
President, any Vice President or the Chief Financial Officer of the Company be
and each hereby is separately authorized and directed for and on behalf of the
Company to execute a Power of Attorney evidencing the foregoing appointment.
/s/ Debra L. Kackley
----------------------------
Debra L. Kackley, Secretary
Dated: January 8, 1999.
